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A n nU A L RE PoRT An d A c c oUnT S
fO R ThE 5 3 wE Ek P E R I Od En dEd
3 OcT ObE R 2 0 1 5
ST Oc k cOdE: T P T
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Welcome
TOPPS hAS dELIvEREd A STROng
PERfORmAncE fOR ThE yEAR, wITh
OuR wELL-ESTAbLIShEd fOcuS On
cOnvEnIEncE, InSPIRATIOn And
RAngE dRIvIng SALES TO A nEw
REcORd And EnAbLIng uS TO hIT
OuR STRATEgIc gOAL Of A OnE
ThIRd ShARE Of ThE dOmESTIc
TILE mARkET A yEAR AhEAd Of
SchEduLE. OuR STRATEgy Of OuT -
SPEcIALISIng ThE SPEcIALISTS
cOnTInuES TO bE vER y EffEcTIvE
And wILL REmAIn AT ThE hEART Of
whAT wE dO AS wE SEEk TO buILd
On ThESE fOundATIOnS And
TARgET fuRThER PROfITAbLE SALES
gROwTh.
Read our Chairman’s Statement on pages 04 and 05
Read more in the Strategic Report on pages 08 to 33
InvESTOR wEbSITE
LOOk OuT fO R ThES E IcOnS
wI ThIn ThE RE PO RT
Read more content in this report
Read more content online
we maintain an investors website containing a
wide range of information of interest to investors:
www.toppstiles.co.uk/media-centre/
investors
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Image:
Regional ReflectionsTm Annan
S T R AT E G I C R E P O R T
www.toppstiles.co.uk Stock code: TPT
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015
O V E R V I E W
S T R AT E G I C R E P O R T
G O V E R N A N C E
F I N A N C I A L S TAT E M E N T S
A D D I T I O N A L I N F O R M AT I O N
28 cORPORATE SOcIAL RESPOnSIbILITy
ch a i r m a n ’s
S t a t e m e n t
0 4
O V E R V I E W
www.toppstiles.co.uk Stock code: TPT
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015
O V E R V I E W
S T R AT E G I C R E P O R T
G O V E R N A N C E
F I N A N C I A L S TAT E M E N T S
A D D I T I O N A L I N F O R M AT I O N
Chairman’s S TATEM EN T
THE BOARD IS ENERGISED
ABOUT THE FUTURE
OPPORTUNITY FOR TOPPS
AND WE BELIEVE THERE IS
SIGNIFICANT SCOPE FOR
FURTHER GROWTH IN THE
BUSINESS.
Darren Shapland
Chairman
INTRODUCTIO N
I am delighted to be presenting my
first Chairman’s statement on behalf
of Topps, having joined the Board in
March this year. Topps is a business I
have long admired and I have always
felt that the brand was strong and the
business was well run. Following an
extensive induction I am pleased to
be able to report to shareholders that
this is indeed the case. I have been
fortunate in my career to have spent
more than 30 years working in some
great consumer businesses and I have
found that Topps benchmarks very well
on a number of levels, including the
strength of its store portfolio, growth
potential, operating margins, financial
position, cashflow generation and
balance sheet strength.
Clarity of purpose and effective
internal communications are the
cornerstone of any company’s success
and the executive team at Topps
have made this an absolute priority,
investing a significant amount of
time to ensure that all colleagues
understand the organisation’s
objectives and the part each
individual plays in delivering that plan.
The business is also closely focussed
on performance management, with
measures for strategic, financial and
operational metrics at the heart of
performance discussions throughout
the business. The combination of these
is key to the success of the business
and the reward structure which all
colleagues participate in.
TRA DIN G AND
FIN AN CIA L P ERFORMA NCE
Taking the above into consideration
I am particularly pleased to be able
to report on a strong year for the
business. Trading performance has
been consistently robust across the
year with overall sales growing by
8.7% and adjusted profit before tax up
by 19.3% to £20.4 million. Revenue
for the period was £212.2 million
which is an all-time record for Topps.
CAPITAL STRU CTU RE
AN D DIVIDEND
Topps has delivered a strong set of
financial results this year and we
remain comfortable with our overall
financial position and the capital
structure that we have in place.
We continue to feel that the current
structure gives us a good balance
of capital efficiency and financial
flexibility. The Board has reviewed
its dividend policy during the year
and has recognised that the current
level of dividend cover is relatively
modest. The Board considers that a
dividend cover of approximately 25 is
achievable over the medium term and
should be sustainable at this level.
As a result, the Board is recommending
to shareholders an increased final
dividend of 2.25 pence per share
(2014: 1.60 pence per share). This
will bring the total dividend for the
year to 3.00 pence per share (2014:
2.25 pence per share), an increase
of 33%. As a consequence of this
recommendation dividend cover for
the year is 2.725 (2014: 2.95).
STRATEGY
Our market share has moved forwards
again this year and we have now
attained our strategic goal of taking
one in every three pounds spent in
the UK domestic tile market. This has
been delivered a full year ahead of
the original strategic plan projections
– a tremendous achievement for the
4
business and a testament to the focus
of the whole team.
Topps successful strategy of “Out-
Specialising the Specialists” will
remain at the heart of our growth
plans as we continue to focus on
inspiring our customers, maximising
convenience and offering the most
authoritative range in our market.
More detail on the company’s strategy
and the effectiveness with which it is
being delivered can be found in the
following pages.
TH E BOA RD AND
CO RPORATE GOVERN ANCE
Governance is something that the Board
of Topps takes very seriously and we
have been working on several fronts
to further improve our compliance with
best practice during the year.
Two key changes in the composition
of the Board occurred during the year,
with Keith Down joining in February
as a non-executive director and Audit
Committee Chair and my appointment
as Chairman in March. As a result of
these changes I am pleased to confirm
that all of the non-executive directors
are now independent and we have
been fully compliant with this part
of the governance code since these
changes came into effect.
At this point I would like to extend
my thanks and that of the Board
and wider business to the previous
Chairman Michael Jack for his service
as a Non-Executive Director for over
15 years including the last three and
half years as Chairman. We are
grateful for Michael’s unwavering
dedication and support to the
business over this period and his very
significant contribution – we wish him
the very best for the future.
During the year we conducted a
strategic risk review – the highlights of
which are included later in this report.
In summary, we were reassured by the
results of this process. The outputs of
the review will form part of our future
Audit Committee agenda.
We have also conducted a thorough
assessment of the performance of the
Board and the committees, including
my own performance as Chairman,
which concluded that the Board is
operating effectively. Information
on the actions we are working on
to improve in the current financial
year, can be found in the Corporate
Governance section of this report.
OUR PEO PLE
We are very proud of our colleagues
across all parts of the business whether
it be in the stores, the distribution
centre or the support functions.
Topps’ service metrics are excellent,
benefitting from extensive training and
development programmes and constant
communication and improvement
processes across the business.
Above all though, it’s the hard work,
dedication and “can do” attitude that
our colleagues demonstrate every day
that make this business successful and
we thank all our colleagues for all their
continued efforts.
TH E FUT UR E FOR TOPPS
The Board is energised about the
future opportunity for Topps and we
believe there is significant scope for
further growth in the business. Our
existing strategy of “Out-Specialising
the Specialists” remains very much
fit for purpose and the management
team will continue to evolve the key
strands of this strategy to maximise the
opportunities and drive performance.
Retailing of home improvements never
stands still and the business is showing
that it can lead the way through a
combination of inspiring its customers,
offering a leading range and
maximising convenience. The Board
remains confident that this consistent
drive to improve the offer, allied to the
excellent service which our colleagues
deliver, will be the foundation of our
future success.
Darren Shapland
Chairman
Read more in the Strategic Report
on pages 08 to 33
Read more in the Financial Review
on pages 19 to 25
Image:
SilvabirchTM Alpine Shimmer
5
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O u r
S t r a t e g y
1 0
Our STRATEGY
In 2013 the Group set itself the strategic goal of taking
profitable market share with a specific target of a one third
share of the UK domestic tile market. Progress towards this
target has been driven by our successful strategy of “Out
Specialising the Specialists” which provides our customers
with a combination of inspirational service, unrivalled
range and convenience through our seamless multi-channel
offering. We are pleased to report that Topps has now
successfully achieved this goal, a full year ahead of the
original plan.
Looking ahead, we plan to maintain our momentum by
focussing the organisation on further profitable sales growth.
“Out Specialising the Specialists” has been very effective,
enabling Topps to grow its share of the UK domestic tile
market in each of the last seven years, and will remain at
the heart of our growth plans. In addition, we have begun
to evaluate potential opportunities to use our existing sales
channels to access more of the total tile market, including the
commercial sector. We already service a small element of the
commercial sector through our existing network and believe
this could represent an important source of future profitable
growth for the business.
Strategic
PILLARS
Read more
on page 11
R
A
N
G
E
P ROFI TABLE
SALES GROWTH
CONVE N I E N C E
Read more
on page 12
N
TIO
A
IR
P
S
N
I
LEGEND
STRATEGIC PILLARS
STRATEGIC GOAL
PILLARS
10
ST RATEGIC PILLAR ONE
Range
As the UK’s leading specialist tile
retailer, we understand the importance
of offering great quality products in the
latest designs at a range of prices, to
help our customers get the most from
their home improvement project. We
are constantly refreshing our range
and launch at least one new product
every week both in store and online.
This unrivalled authority in product
range is critical to our competitive
advantage.
As customer tastes continue to evolve
and improved technology in tile
manufacture allows greater diversity
in style and design, we are finding
that customers are also increasingly
adventurous in their choices. Topps
works collaboratively with leading
manufacturers from around the world
to ensure its range remains at the
forefront of innovation. Areas such
as digital inkjet print technology, for
example, have revolutionised what
can be done with patterned and
natural effect tiles. Where we partner
with manufacturers to drive this kind of
innovation by utilising our expert skills
and knowledge this will often result
in exclusive products and ranges,
with many of these becoming top
sellers, further reinforcing Topps market
leading authority with our customers.
Through Topps, customers can access
a sector leading range of over 5,000
items, which we manage carefully,
providing the right choices by product
sector and updating to stay ahead of
the competition.
2015 has seen the development of the
Topps own brand range with several
new tile and stone lines launched in
own brand packaging, as well as the
launch of a complete Topps tile care
range and other tiling essentials such
as tools.
Through improved new product
development processes our buyers are
bringing new products to the market
faster and much more frequently than
our competitors. Sales of new tile
ranges launched over the last twelve
months have been over £12 million,
accounting for 9.3% of our tile sales,
demonstrating the positive customer
reaction to new product innovation.
Read about our Marketplace
on page 08
Read about our Business Model
on page 09
Read about our Product Innovation
and our Regional Reflections Range
on pages 16 and 17
Image:
Shibori
Image:
GrosvenorTM
What our
customers
are saying
“Having been to a number
of tile stores I have found
Topps Tiles to be one of
the best. Its wide range of
tiles and great customer
ser vice makes it a great
place to shop.”
Image:
Regional ReflectionsTM Dwyran
Our strategy is centred on delivering outstanding value to
our customers by specifically focusing on three key areas:
IN SPIR AT ION
We provide our customers with market leading levels of
personalised service combined with an inspirational in-
store environment that features innovative merchandising,
creative room set photography and visualisation.
CO NVENIENC E
Convenience is a vital element of our customers’
decision to shop with us. Our scale, expertise, and
online and mobile experience combined with seamless
integration across all of our channels to market is an
important source of competitive advantage.
RA NGE
We offer unrivalled authority in product range,
including all the latest designs of high quality products,
with most of our tiles exclusively sourced for Topps.
Our collaborative new product development process
ensures we have the up-to-date ranges and a broad
band of prices to help our customers get the most from
their home improvement projects.
Read more
on page 13
See our Key Performance Indicators
on page 18
Read how Topps mitigates Risks and
Uncertainties on pages 26 and 27
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1 1
ke y
P e r f o r m a n c e
I n d i c a t o r s
1 8
S T R AT E G I C R E P O R T
www.toppstiles.co.uk Stock code: TPT
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015
O V E R V I E W
S T R AT E G I C R E P O R T
G O V E R N A N C E
F I N A N C I A L S TAT E M E N T S
A D D I T I O N A L I N F O R M AT I O N
Key PE RFO RMAN C E I N DI CATO RS (K P Is )
Financial REVIEW
The Board monitor a number of financial and non-financial metrics and KPIs both for the Group and by individual store,
including:
FIN AN CIA L KP Is
LIKE-FO R-L IKE SA LES G ROWTH
YEAR-O N-YEAR
+5.4%
2014: +8.1%
TOTAL SAL ES GROWTH
YEAR-O N-YEAR
+8.7%
2014: +9.8%
* Adjusted PBT as defined on page 3.
NO N-FINAN CIAL KPIs
MARKET SHA RE
33.3%
( + 0 . 7 % )
2014: 32.6%
NET PROMOTER SCORE
73.0%
( - 0 . 5 % )
2014: 73.5%
NO TES
GRO SS MARGIN
+61.2%
( + 3 0 b p s )
2014: 60.9%
ADJ USTED PBT*
£20.4m
( + 1 9 . 3 % )
2014: £17.1m
NET DEBT
£28.4m
( - £ 2 . 1 m )
2014: £30.5m
INVENTORY DAYS
124
( - 6 . 8 % )
2014: 133
CARBO N EMISSION S PER
STO RE (TO NNES P ER AN NUM)
36.9
( - 1 6 . 5 % )
2014: 44.2
NU MB ER O F STORES
AT YEAR EN D
347
( + 1 2 )
2014: 335
• Net Promoter Score is calculated based on customer feedback to the question of how likely they are to recommend
Topps Tiles to friends or colleagues. The scores are based on a numerical scale from 0–10 which allows customer
to be split into promoters (9–10), passives (7–8) and detractors (0–6). The final score is based on the percentage
of promoters minus the percentage of detractors. Prior year comparative data has been restated to include on-line
responses.
• Energy carbon emissions has been compiled in conjunction with our supplier (SSE) and is based on the actual energy
consumed multiplied by Environment Agency approved emissions factors. Vehicle emissions has been calculated by
our in-house transport team based on mileage covered multiplied by manufacturer quoted emission statistics.
• Market share data is derived from the annual MBD report on the UK tile market. Data for 2014 was originally stated
at 30.3% but was restated by MBD in the 2015 market report.
The Board receive regular information on these and other metrics for the Group as a whole. This information is reviewed
and updated as the Directors feel appropriate.
18
Robert Parker
Chief Financial Officer
FINA NCI AL O BJEC TIVES
In addition to the key strategic
objectives highlighted in the Strategy
section the business maintains a strict
financial discipline, including:
• Primary focus on increasing
revenues and cash generation,
maintaining cost disciplines and
optimising gross margins;
• Capital structure and net debt – the
level of net debt has now been
reduced to a point that the Board
feels is an appropriate balance of
an efficient capital structure and
financial flexibility. The business
remains cash generative and as
we move forwards the Board will
continue to adopt a progressive
dividend policy; and
• Maximising earnings per share
and shareholder returns, including
bi-annual review of our dividend
policy.
2015 WAS A SUCCESSFUL
YEAR FOR TOPPS AND WE
HAVE NOW DELIVERED TWO
CONSECUTIVE YEARS OF
STRONG SALES GROWTH
AND CORRESPONDINGLY
ROBUST PROGRESS ON
PROFITS AND EARNINGS
PER SHARE.
GROUP REVENUE
£212.2m
£195.2m
£177.7m
£177.8m
£175.5m
2011
2012
2013
2014
2015
GROSS MA RGI N
60.0%
60.2%
59.6%
60.9%
61.2%
2011
2012
2013
2014
2015
PROFIT AN D L OSS AC COUNT
Revenue
Revenue for the period ended
3 October 2015 increased by 8.7%
to £212.2 million (2014: £195.2
million). The trading period was 53
weeks, as opposed to 52 weeks in the
prior year, removing the effect of this
additional week of sales would result in
sales growth of 6.7%. Like-for-like store
sales increased by 5.4% in the period,
which consisted of a 5.3% increase in
the first half of the financial period and
a 5.5% increase in the second half.
Gros s Margin
Overall gross margin was 61.2%
compared with 60.9% in the previous
financial period. Over the first half
of the period the gross margin was
60.7%, and we delivered a gross
margin of 61.7% in the second half
of the period. Gross margin in the
second half includes some gains
which crystallised in the period but
apply to the year as a whole and as
a consequence we consider the full
year margin as a good guide to future
margin expectations, with some modest
growth targeted as we move forwards.
19
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Contents
Overview
Ifc wELcOmE
02 AT A gLAncE
04 chAIRmAn’S STATEmEnT
Strategic Report
08 mARkETPLAcE
09 OuR buSInESS mOdEL
10 OuR STRATEgy
11 RAngE
12 InSPIRATIOn
13 cOnvEnIEncE
18 kEy PERfORmAncE IndIcATORS
19 fInAncIAL REvIEw
26 RISkS And uncERTAInTIES
Governance
36 bOARd Of dIREcTORS
38 dIREcTORS’ REPORT
43 cORPORATE gOvERnAncE STATEmEnT
48 REmunERATIOn REPORT
Financial Statements
66 IndEPEndEnT AudITORS’ REPORT
71 cOnSOLIdATEd STATEmEnT
Of fInAncIAL PERfORmAncE
71 cOnSOLIdATEd STATEmEnT
Of cOmPREhEnSIvE IncOmE
72 cOnSOLIdATEd STATEmEnT Of
fInAncIAL POSITIOn
73 cOnSOLIdATEd STATEmEnT Of
chAngES In EquITy
74 cOnSOLIdATEd cASh fLOw
STATEmEnT
75 nOTES TO ThE fInAncIAL STATEmEnTS
100 cOmPAny bALAncE ShEET
101 nOTES TO ThE cOmPAny fInAncIAL
STATEmEnTS
Additional Information
104 fIvE yEAR REcORd
105 nOTIcE Of AnnuAL gEnERAL mEETIng
110 ExPLAnATOR y nOTES TO ThE nOTIcE Of
AnnuAL gEnERAL mEETIng
113 ThE TEAm
122 STORE LOcATIOnS
1
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015OverviewStrategic repOrtgOvernancefinancial StatementSadditiOnal infOrmatiOn
At A gLAncE
TOPPS hAS Th IS
yEAR AchIEvEd ITS
STRATEgIc gOAL
Of AccOunTIng
fOR APPROxImATELy
£1 In EvERy £3
SPEnT I n Th E uk
dOmESTIc TILE
mARkET.
TOPPS hAS OvER
340 STORES AcROSS
ThE uk, PRImARIL y
cOmPETIng In
ThE uk dOmESTIc
TILE mARkET . wE
hAvE A bROAd
gEOgRAPhIc REAch
AcROSS ThE uk wITh
mOST cuSTOmERS
REquIRIng LESS ThAn
A 20 mInuTE dRIvE
TImE TO REAch ThEIR
LOcAL STORE.
2
Topps is the uk’s leading specialist
retailer of tiles. Our business is focussed
on the market for the refurbishment
of domestic housing and provides an
industry leading range of tiles and
associated accessories appropriate to
this market. Our customer base includes
both homeowners (predominantly retail
customers) and tile fitters (trade customers)
and our business is based on a broadly
even split between the two customer
types.
Our colleagues are a key ingredient of
our business model – our customers rely
on our expert product knowledge and
world class customer service.
346
stores
See our full Store list
on page 122
3
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16
52
52
16
72
135
www.toppstiles.co.uk Stock code: TPToverview Highlights
gROuP REvEnuE
£212.2m
( + 8 . 7 % )
2014: £195.2m
gROSS mARgIn
61.2%
( + 3 0 b p s )
2014: 60.9%
fInAL dIvIdEnd
2.25p
( + 4 0 . 6 % )
2014: 1.60p
LIkE-fOR-LIkE 1
+5.4%
2014: +8.1%
AdjuSTEd PROfIT bEfORE TAx
2
STATuTOR y mEA SuRES
P ROfIT bEfO RE TAx
£17.0m
( + 1 . 8 % )
2014: £16.7m
bA SIc EA RnIn gS PE R ShAR E
6.75p
( + 4 . 0 % )
2014: 6.49p
£20.4m
( + 1 9 . 3 % )
2014: £17.1m
AdjuSTEd EARnIngS PER ShARE
3
8.17p
( + 2 3 . 2 % )
2014: 6.63p
TOTAL dIvIdEn d
3.00p
( + 3 3 . 3 % )
2014: 2.25p
nE T dEbT 4
£28.4m
2014: £30.5m
fInAncIAL hIghLIghTS
• Record sales of £212.2m. Like-for-like sales growth of 5.4%
• gross margin increased to 61.2% (2014: 60.9%) reflecting further
sourcing gains and our focus on a differentiated product offer
cuRR EnT TRAdIn g An d O uT LO Ok
• The group is now trading from 346 stores (2014: 336 stores)
• In the first eight weeks of the new financial period, group revenues,
stated on a like-for-like basis, increased by 3.3% (2014: 5.8%)
• Adjusted profit before tax2 of £20.4 million, up by 19.3%
• Increased final dividend of 2.25 pence per share (2014: 1.6 pence
per share), making a total for the year of 3.00 pence per share
(2014: 2.25 pence per share), an increase of 33%
• net debt4 at period end reduced to £28.4 million (2014: £30.5 million)
OPERAT IOnAL hIghLIghTS
• Strategy of “Out Specialising the Specialists” continues to deliver
successful results
• Strategic goal of taking £1 in every £3 spent in the uk domestic tile market
achieved one year early – seventh consecutive year of market share gains
• Trade sales increased to 50% of total (2014: 46%) driven by growth of
nO TES
1
2
Like-for-like revenues are defined as sales from stores that have been trading for more than 52 weeks.
Adjusted profit before tax excludes several items we have incurred during the period which are not
representative of underlying performance, these are set out as follows:
AdjUSTEd PRE T Ax PRofiT
PRESEnTEd on ThE f AcE of ThE incomE STATEmEnT
AS non-REcURRinG iTEmS:
— business simplification exceptional costs (as detailed in the
2015
£m
20.4
2014
£m
17.1
financial review)
(2.6)
nil
PRESEnTEd AS PART of oPERATinG coSTS WiThin ThE
RELEvAnT incomE STATEmEnT cAPTionS:
our trade loyalty programme and trend for “do it for me”
— restructuring costs
• Sales benefiting from increased investment in new product development –
9.3% of tile revenues generated from ranges launched in the last 12 months
• multiple initiatives to extend the appeal of the Topps brand underway,
including:
— A programme of ‘all store improvements’, inspired by the boutique
format, to introduce new branding, display and merchandising
treatments across the entire Topps estate
— Active management of store portfolio – 19 new openings,
9 closures, 2 relocations and 13 refits completed in the year
— Encouraging overall progress made with boutique format, with further
work planned in the year ahead to optimise performance
— the impairment of plant, property and equipment
— freehold property disposal
— premium receivable on the early exit of a store
— gains relating to the forward currency contracts the group (defined
as Topps Tiles Plc and all its subsidiaries) has in place (per IAS39)
— charges for interest against a historic tax liability
— write down of the unamortised issue costs relating to the
2011 Revolving credit facility
STATUToR y PRE T Ax PRofiT
(0.2)
(0.3)
nil
0.5
0.1
(0.9)
nil
17.0
(0.2)
(0.3)
0.4
nil
0.1
(0.1)
(0.3)
16.7
3
Adjusted for the post tax effect of the items highlighted above.
4 net debt is defined as loan facilities drawn down less cash and cash equivalents.
3
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015OverviewStrategic repOrtgOvernancefinancial StatementSadditiOnal infOrmatiOn
Chairman’s STATEmEnT
ThE bOARd IS EnERgISEd
AbOuT ThE fuTuRE
OPPORTunITy fOR TOPPS
And wE bELIEvE ThERE IS
SIgnIfIcAnT ScOPE fOR
fuRThER gROwTh In ThE
buSInESS.
Darren Shapland
chairman
InTROducTIOn
I am delighted to be presenting my
first chairman’s statement on behalf
of Topps, having joined the board in
march this year. Topps is a business I
have long admired and I have always
felt that the brand was strong and the
business was well run. following an
extensive induction I am pleased to
be able to report to shareholders that
this is indeed the case. I have been
fortunate in my career to have spent
more than 30 years working in some
great consumer businesses and I have
found that Topps benchmarks very well
on a number of levels, including the
strength of its store portfolio, growth
potential, operating margins, financial
position, cashflow generation and
balance sheet strength.
clarity of purpose and effective
internal communications are the
cornerstone of any company’s success
and the executive team at Topps
have made this an absolute priority,
investing a significant amount of
time to ensure that all colleagues
understand the organisation’s
objectives and the part each
individual plays in delivering that plan.
The business is also closely focussed
on performance management, with
measures for strategic, financial and
operational metrics at the heart of
performance discussions throughout
the business. The combination of these
is key to the success of the business
and the reward structure which all
colleagues participate in.
TRAdIng And
fInAn cIAL P ERfORmAncE
Taking the above into consideration
I am particularly pleased to be able
to report on a strong year for the
business. Trading performance has
been consistently robust across the
year with overall sales growing by
8.7% and adjusted profit before tax up
by 19.3% to £20.4 million. Revenue
for the period was £212.2 million
which is an all-time record for Topps.
cAPITAL STRucTuRE
And dIvIdEn d
Topps has delivered a strong set of
financial results this year and we
remain comfortable with our overall
financial position and the capital
structure that we have in place.
we continue to feel that the current
structure gives us a good balance
of capital efficiency and financial
flexibility. The board has reviewed
its dividend policy during the year
and has recognised that the current
level of dividend cover is relatively
modest. The board considers that a
dividend cover of approximately 25 is
achievable over the medium term and
should be sustainable at this level.
As a result, the board is recommending
to shareholders an increased final
dividend of 2.25 pence per share
(2014: 1.60 pence per share). This
will bring the total dividend for the
year to 3.00 pence per share (2014:
2.25 pence per share), an increase
of 33%. As a consequence of this
recommendation dividend cover for
the year is 2.725 (2014: 2.95).
STRAT Egy
Our market share has moved forwards
again this year and we have now
attained our strategic goal of taking
one in every three pounds spent in
the uk domestic tile market. This has
been delivered a full year ahead of
the original strategic plan projections
– a tremendous achievement for the
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www.toppstiles.co.uk Stock code: TPToverview
business and a testament to the focus
of the whole team.
Topps successful strategy of “Out-
Specialising the Specialists” will
remain at the heart of our growth
plans as we continue to focus on
inspiring our customers, maximising
convenience and offering the most
authoritative range in our market.
more detail on the company’s strategy
and the effectiveness with which it is
being delivered can be found in the
following pages.
T hE bOARd And
c ORPORATE gOvE RnAncE
governance is something that the board
of Topps takes very seriously and we
have been working on several fronts
to further improve our compliance with
best practice during the year.
Two key changes in the composition
of the board occurred during the year,
with keith down joining in february
as a non-executive director and Audit
committee chair and my appointment
as chairman in march. As a result of
these changes I am pleased to confirm
that all of the non-executive directors
are now independent and we have
been fully compliant with this part
of the governance code since these
changes came into effect.
At this point I would like to extend
my thanks and that of the board
and wider business to the previous
chairman michael jack for his service
as a non-Executive director for over
15 years including the last three and
half years as chairman. we are
grateful for michael’s unwavering
dedication and support to the
business over this period and his very
significant contribution – we wish him
the very best for the future.
during the year we conducted a
strategic risk review – the highlights of
which are included later in this report.
In summary, we were reassured by the
results of this process. The outputs of
the review will form part of our future
Audit committee agenda.
we have also conducted a thorough
assessment of the performance of the
board and the committees, including
my own performance as chairman,
which concluded that the board is
operating effectively. Information
on the actions we are working on
to improve in the current financial
year, can be found in the corporate
governance section of this report.
OuR PE O PL E
we are very proud of our colleagues
across all parts of the business whether
it be in the stores, the distribution
centre or the support functions.
Topps’ service metrics are excellent,
benefitting from extensive training and
development programmes and constant
communication and improvement
processes across the business.
Above all though, it’s the hard work,
dedication and “can do” attitude that
our colleagues demonstrate every day
that make this business successful and
we thank all our colleagues for all their
continued efforts.
ThE fuTuRE fOR TOPP S
The board is energised about the
future opportunity for Topps and we
believe there is significant scope for
further growth in the business. Our
existing strategy of “Out-Specialising
the Specialists” remains very much
fit for purpose and the management
team will continue to evolve the key
strands of this strategy to maximise the
opportunities and drive performance.
Retailing of home improvements never
stands still and the business is showing
that it can lead the way through a
combination of inspiring its customers,
offering a leading range and
maximising convenience. The board
remains confident that this consistent
drive to improve the offer, allied to the
excellent service which our colleagues
deliver, will be the foundation of our
future success.
Darren Shapland
chairman
Read more in the Strategic Report
on pages 08 to 33
Read more in the Financial Review
on pages 19 to 25
Image:
SilvabirchTm Alpine Shimmer
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015OverviewStrategic repOrtgOvernancefinancial StatementSadditiOnal infOrmatiOn
cASE STUdy
OuR SuccESSfuL
rebrand
...
Our all store improvement programme is
much more than a change in logo colour
and in-store signage; it is a major investment
designed to create a more inspirational and
professional looking store to help broaden
our customer base by persuading new
customers to consider Topps.
Personal Touch
we’ve added to the in-store experience
with the introduction of state-of-the-art iPads
Read more about our Convenience
Strategic Pillar on page 13
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ST R AT EgIc R E P O R T
gOvE RnAn cE
fInAn cI A L S TAT EmEnT S
Ad dI T I OnA L In fO RmAT I On
Strategic
Report
C o n t e n t s
08 mARkETPLAcE
09 OuR buSInESS mOdEL
10 OuR STRATEgy
11 RAngE
12 InSPIRATIOn
13 cOnvEnIEncE
18 kEy PERfORmAncE IndIcATORS
19 fInAncIAL REvIEw
26 RISkS And uncERTAInTIES
28 cORPORATE SOcIAL RESPOnSIbILITy
The in-store customer interaction at Topps
is vitally important as over 99% of our
customers visit a store at some stage in
their shopping journey. customers tell us
that this is because of the tactile nature
of the product and the ability to browse
and explore such a wide selection of
tiles. Every year we invest in a range of
improvements across all stores. during
the year we invested around £2 million
in new signage and exterior upgrades
for all of our stores which now feature the
new branding.
The display and merchandising upgrades
that we’ve implemented have resulted in
the most up-to-date store formats, to make
the overall shopping experience fresher,
simpler and more appealing.
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015 Strategic REPORT
The content of this Strategic report meets the content
requirements of the Strategic Report as set out in s414a
of the companies Act 2006. This Strategic report and
chairman’s Statement contains certain forward-looking
statements. These statements are made by the directors
in good faith based on the information available to them
up to the time of their approval of this report and such
statements should be treated with caution due to the inherent
uncertainties, including both economic and business risk
factors, underlying any such forward-looking information.
Matthew Williams
chief Executive Officer
Marketplace
ThE uk TILE mARkET And
PERfORmAncE Of ThE buSInESS
Topps predominantly serves the
domestic tile market with all of our
products going into the refurbishment of
existing uk housing stock. Our market
is therefore discretionary in nature
– the vast majority of expenditure is
driven by a customer choosing to
improve their home, with very little
related to essential maintenance.
This puts a particular emphasis on
consumer confidence as a key driver of
our market and performance.
In addition, one of the key influences
in a customer taking on a home
improvement project is their purchase
of a new home – housing transactions
are therefore a very useful indicator
of likely future demand. following
strong growth in 2014, housing
transactions have flattened out at
approximately 1.2 million per annum.
This remains well below the all-time
peak of 1.7 million recorded in 2007
but also significantly above the very
low levels we saw during 2009 of
approximately 0.7 million.
we also consider uk house price data
to be a useful indicator of the relative
health of our market. house prices are
a good reflection of both the housing
market and consumer confidence as
home owners tend to feel more affluent
in a rising market. during the year we
have seen an increase in house prices,
with the average price of a house
in the uk rising to £195,585, an
increase of 3.8% on the previous year
(source: nationwide).
The annual tile industry report
published by mbd covers the whole
of the uk tile market (domestic
& commercial) and is based on
manufacturer and supplier data.
growth of the entire market in 2014
was 5.5% on a value basis. for 2015,
based on mbd volume estimates,
industry and supplier data we estimate
c.3.6% growth on a value basis.
Read our Strategy on page 10
hISTOR y Of TOPPS mARkET
ShARE In ThE dOmESTIc TILE
mARkET
33.3%
32.6%
29.9%
30.6%
27.9%
26.1%
35.0%
33.0%
31.0%
29.0%
27.0%
25.0%
23.0%
21.0%
19.0%
17.0%
15.0%
2010
2011
2012
2013
2014
2015
T OPPS POSITIOn wI ThIn ThE
whOLE mARkET (dOmESTIc
And cOmmERcIAL)
DOMESTI C
TOPPS
DIY SHEDS
SPECIALISTS
OTHE R
COMM ERCIAL
18%
17%
16%
4%
LARGE COMM ERCI AL
27%
NEW BUIL D HOUSI NG 10%
SMAL L BUSIN ESS
8%
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Our business model is how we create value. All of our key activities, undertaken with our suppliers, through our people
and for our customers, are focused on delivering our strategy.
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LEGEND
KEY RELATIONSHIPS
KEY ACTI VITES
STRATEGIC PILLARS
STRATEGIC GOAL
Topps is the uk’s leading specialist
retailer of tiles. we supply tiles
and associated accessories for
the refurbishment of uk domestic
housing to both a trade and retail
customer base.
we operate a vertically integrated
supply chain sourcing many of our
bestselling tiles direct from factories
around the world and rely on strong
relationships with key suppliers
who we often work together with to
develop new product innovations.
Our business operates from over 340
uk based retail outlets of c.5,000
sq ft which are typically located on
trade parks or on main arterial roads
in locations near existing dIy outlets.
we operate our stores on a lease
basis with an average unexpired lease
of c.eight years.
Topps stores carry a market leading
range of tiles and associated products,
the majority of which is available
in stock to take away. Our store
colleagues are a key ingredient of our
business model – our customers rely
on our expert product knowledge and
service based approach.
combining the key aspects of our
business has created a model which
has endured for the last 50 years and,
when combined with our strategy we
believe will continue to serve us well
into the future.
See our Key Performance Indicators
on page 18
Read how Topps mitigates Risks and
Uncertainties on pages 26 and 27
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Our STRAT Egy
In 2013 the group set itself the strategic goal of taking
profitable market share with a specific target of a one third
share of the uk domestic tile market. Progress towards this
target has been driven by our successful strategy of “Out
Specialising the Specialists” which provides our customers
with a combination of inspirational service, unrivalled
range and convenience through our seamless multi-channel
offering. we are pleased to report that Topps has now
successfully achieved this goal, a full year ahead of the
original plan.
Looking ahead, we plan to maintain our momentum by
focussing the organisation on further profitable sales growth.
“Out Specialising the Specialists” has been very effective,
enabling Topps to grow its share of the uk domestic tile
market in each of the last seven years, and will remain at
the heart of our growth plans. In addition, we have begun
to evaluate potential opportunities to use our existing sales
channels to access more of the total tile market, including the
commercial sector. we already service a small element of the
commercial sector through our existing network and believe
this could represent an important source of future profitable
growth for the business.
Strategic
PILLARS
Read more
on page 11
R
A
N
G
E
PROFITABLE
SALES GROWTH
CONVE N I E N C E
Read more
on page 12
N
TIO
A
IR
P
S
N
I
LEG END
STRATEGIC PILLARS
STRATEGIC GOAL
PILLARS
10
Image:
Regional ReflectionsTm dwyran
Our strategy is centred on delivering outstanding value to
our customers by specifically focusing on three key areas:
InS PI RATI On
we provide our customers with market leading levels of
personalised service combined with an inspirational in-
store environment that features innovative merchandising,
creative room set photography and visualisation.
cOn vEnI En cE
convenience is a vital element of our customers’
decision to shop with us. Our scale, expertise, and
online and mobile experience combined with seamless
integration across all of our channels to market is an
important source of competitive advantage.
RAn gE
we offer unrivalled authority in product range,
including all the latest designs of high quality products,
with most of our tiles exclusively sourced for Topps.
Our collaborative new product development process
ensures we have the up-to-date ranges and a broad
band of prices to help our customers get the most from
their home improvement projects.
Read more
on page 13
See our Key Performance Indicators
on page 18
Read how Topps mitigates Risks and
Uncertainties on pages 26 and 27
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STRATEgIc P IL L AR OnE
Range
As the uk’s leading specialist tile
retailer, we understand the importance
of offering great quality products in the
latest designs at a range of prices, to
help our customers get the most from
their home improvement project. we
are constantly refreshing our range
and launch at least one new product
every week both in store and online.
This unrivalled authority in product
range is critical to our competitive
advantage.
As customer tastes continue to evolve
and improved technology in tile
manufacture allows greater diversity
in style and design, we are finding
that customers are also increasingly
adventurous in their choices. Topps
works collaboratively with leading
manufacturers from around the world
to ensure its range remains at the
forefront of innovation. Areas such
as digital inkjet print technology, for
example, have revolutionised what
can be done with patterned and
natural effect tiles. where we partner
with manufacturers to drive this kind of
innovation by utilising our expert skills
and knowledge this will often result
in exclusive products and ranges,
with many of these becoming top
sellers, further reinforcing Topps market
leading authority with our customers.
Through Topps, customers can access
a sector leading range of over 5,000
items, which we manage carefully,
providing the right choices by product
sector and updating to stay ahead of
the competition.
2015 has seen the development of the
Topps own brand range with several
new tile and stone lines launched in
own brand packaging, as well as the
launch of a complete Topps tile care
range and other tiling essentials such
as tools.
Through improved new product
development processes our buyers are
bringing new products to the market
faster and much more frequently than
our competitors. Sales of new tile
ranges launched over the last twelve
months have been over £12 million,
accounting for 9.3% of our tile sales,
demonstrating the positive customer
reaction to new product innovation.
Read about our Marketplace
on page 08
Read about our Business Model
on page 09
Read about our Product Innovation
and our Regional Reflections Range
on pages 16 and 17
Image:
Shibori
Image:
grosvenorTm
What our
customers
are saying
“having been to a number
of tile stores I have found
Topps Tiles to be one of
the best. Its wide range of
tiles and great customer
ser vice makes it a great
place to shop.”
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cOnT In uEd
STRATEgIc P IL L AR TwO
Inspiration
Providing customers with an
inspirational shopping experience has
been critical to Topps market share
growth over recent years. due to the
relatively infrequent purchase cycle of
our retail customers we believe that
high levels of service and expertise in
store are key elements of our success.
we have an absolute commitment to
delivering best in class customer service
and this is essential in helping our
customers to make informed choices.
we focus on offering friendly, honest
and helpful advice without ever being
pushy. All of our stores are mystery
shopped once every month and we
also monitor each store’s net Promoter
Score1 (nPS) on a monthly basis.
Our customers’ home improvement
projects are becoming ever more
adventurous and the support required
even more involved. As a specialist
business with a total focus on tiles we
are ideally placed to respond to this
trend and meet our customers’ needs.
Our specialist team of advisors can
truly inspire our customers and support
them with all the expert advice they
need to make their project a success.
The widely reported trend towards
“do it for me” over “do it yourself”
continues and we are seeing the
impact of this in our business. Our
retail customers are increasingly
choosing to employ the services of
a professional fitter and will often
transact through them. Even in these
scenarios we play an important
facilitator role, often introducing home
owners to loyal trade fitters.
This year we have significantly
extended the trade loyalty programme
we launched in 2014 and this is
helping us to extend both our trade
customer base and also increase the
“share of wallet” from our existing
trade customers. Our trade loyalty
programme has gone from strength
to strength this year as the trend to
“do it for me” has accelerated. work
continues to drive participation levels
further and to boost the rewards
available to our most loyal trade
customers. The relationship between
our store teams and their trade
customers remains a key element of
our success in this sector of the market.
As a result trade sales have continued
to increase their share of the sales mix
and now account for 50% (2014:
46%) of our total sales.
we continue to invest across our store
estate to ensure that our stores are
inspirational places to shop. The major
focus this year has been on improving
the external appearance of our stores.
The biggest element of this has been
a new branding treatment, with all
stores having now received new
exterior signage. customer feedback
regarding the new branding has been
consistently strong and we believe this
is an important element in extending
our customer reach while also ensuring
that the Topps brand continues to
appeal to existing customers.
Read about our Successful Rebrand
on pages 06 and 07
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What our
customers
are saying
“The team were amazing,
they showed me many
different options that
inspired me and suited
my budget.”
1 A full explanation of the nPS methodology
and associated scores can be found within
the kPIs section of this report.
12
Strategic reportwww.toppstiles.co.uk Stock code: tpt STRATEgIc P IL L AR ThREE
Convenience
convenience across all our shopping
channels is a vital element of our
customers’ decision to shop with us.
Our scale, expertise and ability to
seamlessly integrate all of our channels
to market is an important source of
competitive advantage.
In 2014, the group developed the
“boutique” format, an experimental
new small store concept, which
incorporated a fresh new store design
and a number of innovative in-store
features. designed principally as a
method for bringing the Topps offer
to smaller high Street locations, the
development of the boutique format
has also inspired a variety of new
initiatives across the core store estate,
which are bringing significant benefits
to the Topps business as a whole.
Image:
visualiser is easily accessible on
laptops, tablets and mobile phones
m o b i l e
s t o r e s
CREDIT CARD
A NAME
r e m o t e
p a y m e n t s
o n - l i n e
t r a d e
fi t t e r s
w e b c h a t
STO RE S
Our stores remain by far our most
dominant channel with over 99% of our
customers visiting a store at some stage
in their shopping journey with Topps.
customers tell us that this is because
of the tactile nature of the product,
the market leading service levels on
offer and good stock availability. we
have continued to focus on optimising
returns from the existing store estate,
adding new locations selectively where
we believe strong opportunities exist.
we also target tactical relocations of
individual stores where this is supported
by a local market opportunity. In the last
12 months we opened 11 new core
stores and closed six, resulting in a net
increase of five core stores to bring
the total, at year end, to 323 (2014:
318). These new stores have performed
well and we remain very satisfied with
the return on investment. In addition to
the improvements made to all stores
detailed above, we fully refitted 13
stores and made minor improvements in
seven other stores during the period.
In the year ahead we have plans in
place to continue with a similar range
of activities. we expect to increase the
core store estate by 10 new units and
fully refit around 15 stores plus other
minor works as appropriate. we will
also continue our programme of all store
improvements which will be focussed
on the new merchandising treatments
inspired by our boutique concept that
we have trialled at our new Lab Stores at
worcester and Shoreditch.
during the year we conducted a
strategic review of our clearance
stores. Over recent years we have
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cOnT In uEd
Convenience
cOnT In uEd
converted many of the clearance
stores to the more profitable core Topps
format and most of the remaining
units are located very close to existing
core stores. As a result of the review
we have decided to consolidate the
business behind the core format. At the
period end we had 11 (2014: 12)
Topps clearance stores and in the year
ahead four of these will be converted
to the core format and the remaining
seven will be closed.
The boutique format was extended
during the year with the addition of a
further eight stores, including the first
two outside of London, in cheshire. This
brings the total number of boutique stores
trading to 13 (2014: five). In addition to
extending our reach, boutique continues
to generate lots of rich learning – that we
are utilising in the core estate wherever
appropriate. we continue to believe
there is an opportunity for a roll-out of
this format and are focusing our efforts
on further refinement and evolution in the
year ahead to optimise its performance.
As a result, while there may be some
movement in the boutique store portfolio
in the current year, the number of stores
trading is likely to remain at around the
current level.
given the closure of the remaining
clearance format stores, we expect
modest net growth in store numbers for
the year ahead and will continue to
grow our core Topps format both next
year and beyond.
OnLInE
Online research is a vital part of
any customer journey never more so
than when customers are looking for
inspiration. The ability to research
projects online is one of the ways in
which we offer customers convenience
and we strive to provide a consistent
experience across all touch points
including store visits, online and
mobile. we also utilise the on-line
payment facility to help deliver
convenience to customers who have
ordered in store or over the phone but
wish to pay for remotely.
Over 70% of our customers use our
website at some point in their journey,
as well as making numerous trips to a
store. we therefore believe the ‘pure
play’ online market for tiles remains very
small and our ability to combine our
website offering with the skilled advice
and convenience available through
a physical store presence gives us a
significant competitive advantage over
any pure play online retailer of tiles.
This year has seen the launch of a
market-leading internet-based tile
visualiser which is accessed through
our web site. we have also enabled
colleagues to use this as part of the
in store sales process by providing
an iPad to demonstrate to customers
exactly how various tile combinations
look in a variety of room sets.
TRAdE
while tradesmen are a distinct
customer group they are also a very
important as an alternative channel
to market for Topps, with some of
our customers being introduced to
us through their chosen tile fitter. Of
these new customers, a portion will
transact directly, with the remainder
finding it more convenient to transact
through their fitter, such that we may
never deal with those end consumers
Proof 9 9 December 2015 6:10 PM 24457.04
What our
customers
are saying
“I ordered them online
and within a couple of
hours I had a phone
call from Topps Tiles to
say they were ready for
collection at our local
store.”
Read Topps At a Glance
on page 02
Read about our Marketplace
on page 08
14
Strategic reportwww.toppstiles.co.uk Stock code: tpt in store. we continue to see good
growth potential in our trade business
as home owners rely increasingly
on specialist tradesmen to complete
their tiling projects and expect the
proportion of group sales coming
through this channel to increase further.
STRAT EgIc EnAbLERS
In addition to the three key areas of
strategic focus highlighted above there
are a number of “strategic enablers”
which the business considers key to
successfully delivering its strategy.
Brand Awareness &
Consideration
Topps has further extended its market
leadership over the past year, and is
investing to further grow both its brand
awareness and its ‘consideration’
amongst consumers who are already
aware of the brand. As we continue to
evolve as a business we believe that
the Topps brand can appeal to an ever
wider proportion of potential customers.
The high profile nature of our store
locations provide us with good levels
of local awareness. during the year
we have focussed on consideration
by significantly improving the “kerb
appeal” of our stores. The main activity
has been new signage which adopts
the brand representation developed for
our boutique small store concept.
we have continued to invest in a
broad range of traditional and digital
media which have been designed
to bolster overall awareness and
consideration levels. we have also
evolved our mix of media to target
consumers who are actively engaged
in a tile related purchasing decision.
Colleag ue En gage m ent &
Commu nic at i ons
It is imperative that all of our people
have a clear understanding of
the organisation’s goals and the
strategic plan to attain them. we
invest significant time and effort in
communicating and engaging all
of our colleagues in our plans for
the business. during the year we
held two major conference events
– attended by all of our store and
support office managers. In addition
to these major communication events
we regularly update all colleagues on
the company’s progress via email,
our in-house magazine, quartile, and
a recently introduced system of text
messaging from our cEO sent directly
to colleagues mobile phones. we also
operate a very successful employee
forum, TeamTalk, which allows
colleagues to have their say in how we
operate our business and we conduct
a regular colleague engagement survey.
Visualiser
Store colleagues are our strongest
asset and we wanted the visualiser
to be an extension of this
P eo ple D ev e lopm e nt
we have a strong culture and history
of growing and developing our people
from within the organisation and it is
important to us that our employees
fulfil their potential during their time
at Topps. we have been providing
Adult Apprenticeship qualifications for
the last six years in Topps and around
800 colleagues have benefitted from
this programme. Technical training
is also very important to us in order
to maintain our credentials as the
leading specialist tile retailer – store
colleague learning and development
is supported by an e-learning platform
which regularly includes new courses
on the latest products, services and
processes. we are in the process of
developing more opportunities for
colleagues to benefit from a wider
development offering provided by our
in-house team of Trainers and Advisors.
Over the course of the coming year
we will focus on developing new
content to support an even bigger
push on colleague development.
Read about Our People
on page 32
Read about Corporate Social
Responsibility on pages 28 to 33
15
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015OveRviewStRAtegic RepORtgOveRnAncefinAnciAl StAtementSAdditiOnAl infORmAtiOn www.toppstiles.co.uk Stock code: TPT
cASE STUdy
PROducT
innovation
...
Dwyran™
RIch & vARIEd fInISh
Slate Effect
The slate industry in wales began
during the Roman period. Our dwyran
quarried slate effect tiles are a popular
choice for those looking for a rich and
varied finish.
Langport™
fInE-gRAInEd
Limestone Effect
Inspired by white Lias Limestone found
in Somerset, Langport’s warming white
tones and delicate grey veining is an
ideal choice to make a room look light
and enhance your living space.
Launched in the summer of 2015, ‘Regional
Reflections’ is an innovative collection of
six stone-effect ceramic tiles that have taken
their influence from the quarried stone that
can be found throughout the uk.
This exclusive collection of 29.8 x 59.8cm
tiles is made in britain and has been
created using the latest inkjet technology
which gives an authentic effect, but without
the associated cost of natural stone or the
need for sealing and maintenance.
Each stone’s name within the collection
has taken its influence from the village
or town near to the quarry where the
natural product is found and each tile
pays homage to the natural stone that has
formed a part of our landscape.
Available in six neutral colours, the
palette of black, greys, cream and white,
demonstrates the timeless quality of this
collection, with each tile reflecting its own
distinctive characteristics of the particular
regional stone: Limestone, Sandstone and
Riven Slate.
16
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Strategic report Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015
Annan™
wARmIng TOnES
Sandstone Effect
Annan is a medieval town in the south
west of Scotland. many of its buildings
are built from the local red sandstone.
The Annan stone-effect tile features
directional warming red tones against a
sumptuous cream base.
AnnAn
lOwICK
dwyRAn
COtteSMORe
lAnGPOR t
AShInGtOn
Lowick™
dRAmATIc ShAdIng
Limestone Effect
Lowick is a village and civil parish in
the South Lakeside district of cumbria.
Inspired by the natural limestone quarried
in cumbria, the Lowick stone-effect tile is
the perfect way to connect with mother
nature and bring a touch of the Lake
district into your home.
Cottesmore™
vARIEd TExTuRES
Limestone Effect
Taking inspiration from the limestone
quarried in Rutland, cottesmore is a
reflection of the moss green-grey stone
that can be found in several cathedrals,
Oxford’s colleges and the houses of
Parliament.
Ashington™
dELIcATE fOSSIL dETAILS
Limestone Effect
named after a hamlet in dorset,
Ashington is inspired by the natural
limestone that is found along the South
coast and has been used in many
historical monuments, churches and
buildings including corfe castle, the
british Library and westminster Abbey.
17
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OverviewStrategic repOrtgOvernancefinancial StatementSadditiOnal infOrmatiOn Key PERfORmAncE IndIcATORS (kP Is
)
The board monitor a number of financial and non-financial metrics and kPIs both for the group and by individual store,
including:
fInAncIAL kPIs
LIkE-fOR-LIkE SALE S gROwTh
yEAR-On- yEAR
+5.4%
2014: +8.1%
TOTAL SALES gROwTh
yEAR- On-yEAR
+8.7%
2014: +9.8%
* Adjusted PbT as defined on page 3.
nOn-fInAncIAL kPIs
mARkET ShARE
33.3%
( + 0 . 7 % )
2014: 32.6%
nET PROmOT ER ScORE
73.0%
( - 0 . 5 % )
2014: 73.5%
nOTES
gROSS mARgIn
+61.2%
( + 3 0 b p s )
2014: 60.9%
AdjuS TEd PbT*
£20.4m
( + 1 9 . 3 % )
2014: £17.1m
nE T dEbT
£28.4m
( - £ 2 . 1 m )
2014: £30.5m
In vEnTO R y dA yS
124
( - 6 . 8 % )
2014: 133
cARbOn EmI SSI OnS PE R
STORE (TOn nE S PE R Ann um)
36.9
( - 1 6 . 5 % )
2014: 44.2
numbE R Of STO RE S
AT yEAR En d
347
( + 1 2 )
2014: 335
• net Promoter Score is calculated based on customer feedback to the question of how likely they are to recommend
Topps Tiles to friends or colleagues. The scores are based on a numerical scale from 0–10 which allows customer
to be split into promoters (9–10), passives (7–8) and detractors (0–6). The final score is based on the percentage
of promoters minus the percentage of detractors. Prior year comparative data has been restated to include on-line
responses.
• Energy carbon emissions has been compiled in conjunction with our supplier (SSE) and is based on the actual energy
consumed multiplied by Environment Agency approved emissions factors. vehicle emissions has been calculated by
our in-house transport team based on mileage covered multiplied by manufacturer quoted emission statistics.
• market share data is derived from the annual mbd report on the uk tile market. data for 2014 was originally stated
at 30.3% but was restated by mbd in the 2015 market report.
The board receive regular information on these and other metrics for the group as a whole. This information is reviewed
and updated as the directors feel appropriate.
18
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Strategic reportwww.toppstiles.co.uk Stock code: tpt Financial REvIEw
Robert Parker
chief financial Officer
fInAncIAL ObjEcTIvES
In addition to the key strategic
objectives highlighted in the Strategy
section the business maintains a strict
financial discipline, including:
• Primary focus on increasing
revenues and cash generation,
maintaining cost disciplines and
optimising gross margins;
• capital structure and net debt – the
level of net debt has now been
reduced to a point that the board
feels is an appropriate balance of
an efficient capital structure and
financial flexibility. The business
remains cash generative and as
we move forwards the board will
continue to adopt a progressive
dividend policy; and
• maximising earnings per share
and shareholder returns, including
bi-annual review of our dividend
policy.
2015 wAS A SuccESSfuL
yEAR fOR TOPPS And wE
hAvE nOw dELIvEREd TwO
cOnSEcuTIvE yEARS Of
STROng SALES gROwTh
And cORRESPOndIngL y
RObuST PROgRESS On
PROfITS And EARnIngS
PER ShARE.
gR OuP REvEn uE
£212.2m
£195.2m
£177.7m
£177.8m
£175.5m
2011
2012
2013
2014
2015
gR OS S mARgIn
60.0%
60.2%
59.6%
60.9%
61.2%
2011
2012
2013
2014
2015
PROfIT And L O SS AccOu nT
Revenue
Revenue for the period ended
3 October 2015 increased by 8.7%
to £212.2 million (2014: £195.2
million). The trading period was 53
weeks, as opposed to 52 weeks in the
prior year, removing the effect of this
additional week of sales would result in
sales growth of 6.7%. Like-for-like store
sales increased by 5.4% in the period,
which consisted of a 5.3% increase in
the first half of the financial period and
a 5.5% increase in the second half.
Gross Marg in
Overall gross margin was 61.2%
compared with 60.9% in the previous
financial period. Over the first half
of the period the gross margin was
60.7%, and we delivered a gross
margin of 61.7% in the second half
of the period. gross margin in the
second half includes some gains
which crystallised in the period but
apply to the year as a whole and as
a consequence we consider the full
year margin as a good guide to future
margin expectations, with some modest
growth targeted as we move forwards.
19
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015OveRviewStRAtegic RepORtgOveRnAncefinAnciAl StAtementSAdditiOnAl infORmAtiOn Annual cost savings of at least £0.5
million will be realised from the
second half of 2016 onwards and
the business will also benefit from
operational efficiencies as a result of
this simplification.
O pe rat ing Profi t
Operating profit for the period
was £18.9 million (2013: £18.2
million), representing 8.9% of sales
(2013: 9.3%).
Excluding the adjusting items detailed
above operating profit was £21.5
million (2013: £18.7 million),
representing 10.1% of sales
(2013: 9.6%).
O t he r Gai ns and L oss es
during the period we disposed of one
freehold property with no gain (2014:
gain £0.4 million).
F inanc ing
The net underlying interest charge for
the year was £1.1 million (2014:
£1.6 million), excluding the impact of
currency revaluations. The underlying
interest charge has fallen compared to
the prior financial period due the full
year impact of the 2014 renegotiation
of the Rolling credit facility with
associated lower borrowing and
improved rate.
Financial REvIEw
cOnT In uEd
Operating Exp enses
Total operating costs have risen from
£100.7 million to £111.0 million,
an increase of 10.2%. costs as a
percentage of sales were 52.3%
compared to 51.6% in the previous
period. when one-off adjusting items
(detailed below) are excluded, operating
costs were £108.4 million (2014:
£100.2 million), equivalent to 51.1%
of sales (2014: 51.3% of sales).
The movement in adjusted operating
costs is explained by the following
key items:
• Operating a 53 week year, verses
a 52 week year in the prior period
has added £1.9m to costs
during the period we incurred several
charges which we have excluded from
our adjusted operating costs as they
are not representative of the underlying
cost base of the business. These are:
— exceptional business restructuring
costs (as detailed below) of
£2.6 million (2014: £nil)
— other business restructuring costs of
£0.2 million (2014: £0.2 million)
— the impairment of plant, property
and equipment of £0.3 million
(2014: £0.3 million)
— 2015 also saw a one-off gain
relating to the receipt of a premium
for the early exit of a store of
£0.5 million (2014: £nil)
• Inflation at an average of
Restructu ring Cos ts
approximately 1.5% has increased
our cost base by around £1.5
million
The group is progressing two key
initiatives to simplify and streamline
its operations, these are:
• The average number of uk stores
trading during the financial period
was 341 (2013: 329), which
generated an increase in costs of
approximately £2.8 million
• Investment in additional store labour
hours, supporting like for like store
sales growth, accounted for
£0.6 million of additional costs
• Employee profit share costs have
increased by £0.6 million due to
targets across the business being
exceeded as a result of the strong
business performance
• Increase in support costs of £0.8
million, with increased marketing
costs of £0.4 million being the
largest single item.
• The remaining elements of the cost
base are flat when compared to the
prior year
i. The centralisation of its support
functions into one site at Leicester,
incurring a one-off restructuring
charge of £1.5 million (2014: £nil)
ii. The closure of seven clearance
stores, with the remaining four
being converted to the core
Topps format, incurring a one-off
restructuring charge of £1.1 million
(2014: £nil)
These costs have been treated as
exceptional items and have been
reported separately on the face of the
income statement. There was no cash
impact in the period resulting from
these changes but it is expected that
there will ultimately be an equivalent
cash cost to the business. The timing
of the cash outflow will primarily be
driven by successful negotiation to
exit leases.
20
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Strategic reportwww.toppstiles.co.uk Stock code: tpt The company has in place a number
of forward currency contracts
giving rise to a “marked to market”
revaluation as required by IAS39
“financial Instruments: Recognition and
measurement”. This revaluation has
generated a fair value (non-cash) gain
of £0.1 million (2014: £0.1 million
gain). The group does not apply
IAS39 to these instruments and hence
any gains or losses against these
derivatives are applied directly to the
income statement rather than being
offset against balance sheet reserves.
In addition to the above charges
and gains we have also provided for
£0.9 million of interest against historic
outstanding tax liabilities (2014:
£0.1 million charge).
net interest cover was 23.8 times
(2014: 14.2 times) based on earnings
before interest, tax, depreciation and
the impairment of plant, property and
equipment, excluding the impact of
IAS39 in finance charges. The 2014
year included a write down of the
unamortised issue costs relating to
the 2011 Revolving credit facility of
£0.3 million (2015: £nil).
Image:
metro grey
Profit Be fore Tax
Adj uST Ed PR OfI T bEfOR E TAx
Reported profit before tax was
£17.0 million (2014: £16.7 million).
£20.4m
£17.1m
The group profit before tax margin
was 8.0% (2014: 8.6%).
£13.9m
£12.8m
£13.0m
2011
2012
2013
2014
2015
TRAdIng In ThE fIRST
EIghT wEEkS Of ThE
nEw fInAncIAL yEAR
hAS bEEn In LInE wITh
OuR ExPEcTATIOnS
Excluding the adjusting items detailed
on page 3 profit before tax was
£20.4 million (2014: £17.1 million).
The group adjusted profit before tax
margin was 9.6% (2014: 8.8%).
Tax
The effective rate of corporation Tax
for the period was 23.2% (2014:
25.0%).
The group tax rate is higher than the
prevailing uk corporation tax rate due
to non-deductible expenditure and
depreciation on assets not qualifying
for capital allowances.
Ear nings P e r Share
basic earnings per share were
6.75 pence (2014: 6.49 pence).
diluted earnings per share were
6.73 pence (2014: 6.43 pence).
21
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015OveRviewStRAtegic RepORtgOveRnAncefinAnciAl StAtementSAdditiOnAl infORmAtiOn Financial REvIEw
cOnT In uEd
AdjuST Ed EPS
6.18p
5.44p
5.11p
8.17p
6.63p
Excluding the adjusting items detailed
on page 3 adjusted earnings per
share were 8.17 pence (2014:
6.63 pence).
2011
2012
2013
2014
2015
T OTAL dIvIdEnd
3.00p
2.25p
1.25p
1.50p
1.10p
2011
2012
2013
2014
2015
cAPITAL ExPEndI TuRE
£10.8m
£12.0m
£11.2m
£6.1m
£5.5m
2011
2012
2013
2014
2015
nET dEbT
£50.9m
£45.6m
£36.6m
£30.5m
£28.4m
2011
2012
2013
2014
2015
22
Dividend and Di vi dend po li cy
The board has reviewed its dividend
policy during the year and has
recognised that the current level of
dividend cover is relatively modest. The
board considers that a dividend cover
of approximately 25 is achievable
over the medium term and should be
sustainable at this level. As a result of
the proposed future policy, the dividend
for this year has been based on an
approximately 2.725 level of cover.
The board is recommending to
shareholders a final dividend of 2.25
pence per share (2014: 1.60 pence
per share). This will cost £4.3 million
(2014: £3.1 million). The shares will
trade ex-dividend on 7 january 2016
and, subject to approval at the Annual
general meeting, the dividend will be
payable on 4 february 2016.
This brings the total dividend for the
year to 3.00 pence per share (2014:
2.25 pence per share), an increase
of 33%.
bALAncE ShEET
Ca pital e xpe nd it ur e
capital expenditure in the period
amounted to £12.0 million (2014:
£11.2 million), an increase of 7.1%.
key investments are as follows:
— new stores (core format and
boutique) £3.3 million – 19 new
openings, two relocations and nine
closures (2014: £3.1 million)
— Store refits £3.0 million (2014:
£2.7 million)
— Store rebranding £2.5 million
(2014: £0.4 million)
Proof 9 9 December 2015 6:10 PM 24457.04
— Other store related strategic
initiatives £0.7 million (2014:
£1.1 million)
— Other expenditure of £1.2 million,
including £0.8 million of IT
investment (2014: £1.0 million)
— freehold and leasehold investments
£1.3 million – two freehold
purchases in the period (2014:
£2.9 million), and one freehold
disposal.
The board expects capital expenditure
to continue at broadly the same level
in the current financial year.
At the period end the group held
nine freehold or long leasehold
sites including two warehouses and
distribution facilities with a total
carrying value of £16.5 million
(2014: eight freehold or long
leasehold sites valued at £16.0
million). The carrying value is
based on the historic purchase cost,
capital expenditure less accumulated
depreciation.
P rope r t y Dis posa ls
during the period we disposed of one
freehold property with no gain or loss
(2014: one property generated £0.4
million gain).
I nve nt or y
Inventory at the period end was
£27.4 million (2014: £27.8 million)
representing 124 days turnover (2014:
133 days turnover). The absolute level
of inventory is broadly stable, with
days cover reducing as we grow sales
on the same stock base.
Capi t al St ru ct u re and Tre as ur y
cash and cash equivalents at the
period end were £16.6 million
(2014: £19.5 million) with
borrowings of £45.0 million (2014:
£50.0 million).
Strategic reportwww.toppstiles.co.uk Stock code: tpt Image:
Attingham Seagrass
wE ARE cOnfIdEnT
ThAT ThE gROuP’S
SuccESSfuL STRATEgy
Of “OuT SPEcIALISIng
ThE SPEcIALISTS” hAS
SIgnIfIcAnT fuRThER
POTEnTIAL And
wILL undERPIn OuR
PROgRESS In ThE yEAR
AhEAd.
gOIng cOn cERn
when considering the going concern
test the board review several factors
including a detailed review of the
above risks and uncertainties, the
group’s forecast covenant and cash
headroom against lending facilities
(which were refinanced in june
2014) and management’s current
expectations. As a result of this
review the board believes that the
group will continue to meet all of
its financial commitments as they fall
due and will be able to continue as a
going concern. Therefore, the board
considers it appropriate to prepare
the financial statements on the going
concern basis.
This gives the group a net debt position
of £28.4 million (2014: £30.5
million). This was better than previously
expected due to the non-payment
of historic tax and interest charges
of c.£4 million (which will now fall
in 2016) and an improved working
capital position compared to the interim
position, principally driven by inventory.
C ash flow
cash generated by operations was
£24.2 million, compared to £24.9
million last period. The year end
in 2015 fell on the 3 October and
was therefore after key month-end
payments had been made (suppliers,
landlords and colleagues), whereas in
the prior period ended 27 September
the equivalent payments had not been
paid. This timing difference is the
principal driver of the small reduction
in cash generation year on year.
23
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015OveRviewStRAtegic RepORtgOveRnAncefinAnciAl StAtementSAdditiOnAl infORmAtiOn Financial REvIEw
cOnT In uEd
2.25p
+40.6%
fInAL dIvIdEnd
2014: 1.60p
3.00p
+33.3%
TOTAL dIvIdEnd
2014: 2.25p
LOng TERm vI AbI L ITy
In accordance with code provision
2.2 of the 2014 corporate
governance code (‘the 2014
code’), in addition to the going
concern statement the directors have
also assessed the prospects of the
group over a longer period.* This
assessment has been done over a
period of 3 years for the following
reasons:
— this is the basis on which strategic
financial plans are prepared; and
— the business is largely dependent
on uk consumer confidence and
discretionary spending which is
difficult to project beyond this
period.
The directors’ assessment has been
made with reference to the group’s
current position and prospects, the
group’s strategy, and principal risks
facing the company (including the
mitigants described), as detailed in the
Strategic Report.
The board considers the key risks to
delivery of these financial plans to
be a reduction in the level of sales
growth and possibly a resultant
weakening in gross margin. As a
result a number of sales and gross
margin based sensitivities have
been prepared and reviewed by the
board. It should also be noted that the
group is operationally geared which
means that there is a relatively high
level of impact from any increases
or decreases in levels of turnover. A
sustained decrease in levels of turnover
would be managed by a reduction in
operational expenditure, reductions in
capital expenditure, tighter working
capital controls and possible restriction
of company dividends. The conclusion
of these sensitivities is that the group
has a good level of financial flexibility
and is well positioned to withstand
a number of risks occurring and or
a sustained reduction in levels of
consumer spending.
based on this review the directors
confirm that they have a reasonable
expectation that the group will
continue to operate and meets its
liabilities, as they fall due, for the next
3 years.
cuRR EnT TRAdIn g An d
m ARkE T c On dITI OnS fOR
ThE y EA R AhEAd
2015 was a successful year for
Topps and we have now delivered
two consecutive years of strong sales
growth and correspondingly robust
progress on profits and earnings per
share.
Trading in the first eight weeks of
the new financial year has been in
line with our expectations, with like
for like sales increasing by 3.3%
(2014: 5.8%). we are confident
that the group’s successful strategy
of “Out Specialising the Specialists”
has significant further potential and
will underpin our progress in the year
ahead.
* due to our accounting period commencing
prior to 1 October 2014, we are not obliged
to and are not adopting the 2014 code in full,
however, in the spirit of best practice and in
light of our business planning process (which
assess business viability in the longer term), we
are adopting this provision of the 2014 code.
24
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Strategic reportwww.toppstiles.co.uk Stock code: tpt
cAuTIOnAR y STATEmEnT
this Strategic Report, and Chairman’s
statement have been prepared solely
to provide additional information to
shareholders to assess the Group’s
strategies and the potential for those
strategies to succeed. these reports
should not be relied on by any other
party or for any other purpose.
the Strategic Report and Chairman’s
statement contains certain forward-
looking statements. these statements
are made by the directors in good
faith based on the information
available to them up to the time of
their approval of this report and
such statements should be treated
with caution due to the inherent
uncertainties, including both
economic and business risk factors,
underlying any such forward-looking
information.
The directors, in preparing this
Strategic and Operational Review,
have complied with s414a of the
companies Act 2006. This business
Review has been prepared for the
group as a whole and therefore gives
greater emphasis to those matters
which are significant to Topps Tiles
Plc and to its subsidiary undertakings
when viewed as a whole.
dIREcTORS’ R ESPOnSIbI LI Ty
STATEmEnT
we confirm to the best of our
knowledge:
• the financial Statements, prepared
in accordance with the relevant
financial reporting framework, give
a true and fair view of the assets,
liabilities, financial position and
profit or loss of the company and
the undertakings included in the
consolidation taken as a whole;
and
Image:
This year has seen the launch
of a market-leading internet-
based tile visualiser
• the Strategic Report, which is
incorporated into the directors’
Report includes a fair review of
the development and performance
of the business and the position of
the company and the undertakings
included in the consolidation
taken as a whole, together with a
description of the principal risks
and uncertainties they face and a
fair, balanced and reasonable view
of the business.
An nuA L gEnE RAL mEE TIn g
The Annual general meeting for the
period to 3 October 2015 will be
held on 28 january 2016 at 10am at
the marriot hotel, Leicester.
Matt Williams
chief Executive Officer
Rob Parker
chief financial Officer
1 december 2015
25
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015OveRviewStRAtegic RepORtgOveRnAncefinAnciAl StAtementSAdditiOnAl infORmAtiOn Risks And uncERTAInTIES
The board conducts a continuing review of key risks and uncertainties. during the year the Audit committee have
discussed the key strategic risks, the likelihood and impact of these occurring and mitigants we have in place.
UK Economy And conSUmER confidEncE
RiSK
imPAcT
miTiGATion
The economy may deteriorate
consumers need to feel confident to
we believe that through a combination of a robust level of
and impact on consumer
invest money into their homes. In the
profitably and financial flexibility the business is able to
confidence.
event of a significant reduction in
withstand short term trading pressures. This has been proven in
house prices, housing transactions or
recent years over the period of the financial crisis. Longer term
consumer confidence we would expect
we consider that the uk housing market remains attractive and
this to adversely impact on business
we believe there remains significant upside from a sustained
performance.
economic recover y.
APPRoPRiATE bUSinESS STRATEGy
RiSK
imPAcT
miTiGATion
Our business strategy will not
without a clear company goal and a
The strategy is reviewed annually, updated as required and
be successfully delivered.
well understood strategy to deliver, the
approved by the board. bi-annual communication events ensure
risk is that the business loses focus and
around two thirds of all colleagues are directly briefed by the
fails to deliver its objectives.
Executive and regular updates are provided to all colleagues on
our progress towards our goals.
The board reviews progress on key strategic initiatives at each
meeting.
ThREAT of nEW EnTRAnTS
RiSK
imPAcT
miTiGATion
new entrants may seek to erode
Loss of market share leading to reduced
we constantly review our competitor set but at the same time we are
our market share.
sales and profitability.
clear on what differentiates Topps from its competitors. Exceptional
customer service, market leading product offer and unrivalled multi-
channel convenience are the key elements of our business which,
whilst imitated, have never effectively been replicated.
LoSS of KEy PERSonnEL
RiSK
imPAcT
miTiGATion
The loss of key individuals
Increased competition also introduces
colleague turnover is monitored. we also have a focus on colleague
could impact on the ability
the risk of increased colleague turnover
engagement surveys to gauge the views of our people across the
of the business to deliver its
and the resulting loss of knowledge,
business. Pay and benefits are benchmarked to ensure we are
objectives.
disruption and associated costs.
rewarding our people in line with their contribution to the business.
In addition we have a detailed succession plan for each key
executive and non-compete clauses for senior colleagues.
LoSS of KEy PERfoRminG SToRES
RiSK
imPAcT
miTiGATion
The loss of key performing
Loss of a multiple number of top
we conduct regular reviews of all stores’ profitability and for our
stores which contribute a
performing stores could cause a
most profitable units security of tenure is key. we review lease
material amount of group
material impact on the company’s
terms where appropriate and will pro-actively re-gear leases to
earnings.
profitability.
ensure we always have at least several years of security.
given our geographic coverage it is also likely that if a key
performing store did close we would migrate some sales into
neighbouring stores.
we also recognise that freehold is the ultimate mitigant and as
part of our continuing review of key stores we consider this where
appropriate.
26
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Strategic reportwww.toppstiles.co.uk Stock code: tpt LoSS of A KEy SUPPLiER
RiSK
imPAcT
miTiGATion
The loss of a key supplier
The loss of a key supplier would
Our supply chain is diverse and due to our scale we can source
could impact on our ability to
potentially lead to disruption in supply
products directly from manufacturers anywhere in the world.
trade.
of key selling products leading to loss
for most products we sell there is an alternative available. If
of sales and profits.
there was not, this would affect the entire market place and
accordingly should not lead to a loss of competitiveness.
finAncinG
RiSK
imPAcT
miTiGATion
The group has a £50 million
The most likely impact of not being able
Loan renewal discussions are conducted well in advance in order
revolving credit facility in place
to renew the loan facility would be the
to allow sufficient time to cater for different negotiation scenarios
which was refinanced in june
requirement to raise additional funding
and would include both existing and new banks to gauge
2014 and expires in june
from shareholders.
interest.
2019. The loan facility contains
financial covenants which are
tested on a bi-annual basis.
The key risks would be either
not negotiating new facilities in
advance of expiry or breaching
a loan covenant which would
have an adverse impact on the
group’s financing position.
The impact of breaching a loan
Loan covenants are measured monthly and reported to the board.
covenant would likely be financial in
The company planning model is updated several times a year and
terms of additional charges and fees.
gives good for ward visibility. Any potential issues would be dealt
At its worst it would also mean the loan
with well in advance by pro-active discussions with lenders.
would be repayable which would be
likely to result in a fundraising.
TEchnoLoGy foR comPETiTivE Adv AnTAGE
RiSK
imPAcT
miTiGATion
utilisation of emerging
we know that c.70+% of customers
we have a dedicated online team who are responsible for Topps
technologies is an important
will research their purchase online
web based activities. The team conduct regular reviews of our
source of competitive
before visiting a store. This research
website vs our key competitors and also review other online
advantage. digital media tools
includes the company website but also
activity such as social media posts involving Topps. A new cRm
such as the company website,
other forms of social media such as
system has been developed which will launch in 2016 and
social media, and customer
facebook, Instagram and Pinterest.
should ensure that we stay at the forefront of our market for the
Relationship management
modern cRm systems are important
immediate future. we work closely with manufacturers of tiles to
(cRm) are key to our continued
in establishing a relationship with our
ensure we are helping to drive innovation in our market and to
success. The technology used
customers and engaging with them on
also benefit from exclusive arrangements wherever possible.
in tile manufacturing can also
a personalised basis. Technology used
be an important source of
in tile manufacture has also moved
competitive advantage.
for ward significantly in recent years
failure to keep pace with
– in particular using digital printing
technology is a key risk.
technology to create a broad range of
designs and effects on the tile surface.
mAjoR REPUTATionAL dAmAGE
RiSK
imPAcT
miTiGATion
The Topps brand is a
whilst impacts from reputational
governance and internal controls are the key mitigants against
ver y important part of our
damage could be wide ranging the
reputational damage. The company operates a wide range of
competitive advantage.
most likely impact would be financial
processes and procedures designed to ensure that we are fully
Possible areas of impact could
resulting from damage to our brand and
compliant with all legal requirements and operate industr y &
be due a failure in our core
consequent loss of sales.
governance best practice across the entire business.
processes around our products,
our stores, our supply chain or
our people.
The directors will continue to monitor all of the key risks and uncertainties and the board will take appropriate actions to
mitigate these risks and their potential outcomes.
27
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As a company with a national
presence and an international supply
chain we take seriously the impact
we have in the places where we do
business.
Over the last twelve years we have
developed our corporate Social
Responsibility (cSR) policies to
respond to the growing need we
face to be good neighbours in the
communities where we trade, help
protect our environment, and look
after the people we employ.
The company’s board has been
fully engaged in this process from its
outset and in 2013 we appointed our
non-executive director, Andy king, to
have specific responsibility for further
developing policies in this area.
we are proud of our achievements in
this field to date which have seen us
become a major supporter of national
charities, consistently reduce our
environmental impact and fully invest
in the people we employ.
OuR cOm mu nI Ty An d
chARITy wO Rk
At the heart of all of our community
and charity work are our staff. They
play an active role in helping us to
become “good neighbours” in the
communities where we trade and
through a company-wide ballot they
decide, every five years, which
national charity they want to support.
LOcA L cOm m unI Ty
Locally, in our role as a good
neighbour, we have continued to
support a wide range of causes.
Through the donation of tiles we have
supported community mosaics in Rhyl,
folkestone, maidstone and Stevenage,
a junior sports club refurbishment in
hemel hempstead, a wildlife park zoo
in canterbury and a dementia care
home in Swindon.
we have also supported local tiling
colleges and construction courses with
the supply of free tiles, including the
birmingham Tiling college, Solihull
Tiling college, a construction Training
college in dartford and groundworks
in Stoke-on-Trent which is a facility
that educates 13–16 year olds in
construction skills.
This year we have also formed a
partnership with bury college where
we offer a supported internship
at our bury store to enable young
people with learning disabilities the
opportunity to gain work experience
and achieve their working aspirations.
yOuTh SPO RT
At Topps, we have always recognised
the benefits that participation in sport
can bring to the communities in which
we trade and we are proud to be
involved in helping children to get
outdoors and become active through
our youth football sponsorship.
for some time we have understood
that sponsoring just one sport can
be restrictive to other sporting
communities, therefore in 2015, we
were delighted to extend our support
to include youth rugby and youth
hockey.
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Birmingham Tiling College
we are proud to support local
tiling colleges and construction
courses
Tile Donations
we continue to support projects
through the donation of tiles and
accessories
Youth Sport
Our youth sport programme
was extended in 2015 to include
rugby and hockey
28
Strategic reportwww.toppstiles.co.uk Stock code: tpt chARITy SuPPORT
Topps has supported help for heroes
since 2008 and has raised over
£300,000 for them in this time.
following a company-wide ballot in
Autumn 2014, our colleagues voted
to switch their support to macmillan
cancer Support, a partnership which
will stay in place until at least the
end of 2019. we have already seen
some fantastic fundraising events from
our colleagues, including marathon
running, bike rides, barbeques and
coffee mornings. we will also be
donating 4p directly to macmillan from
each 5p charged for a carrier bag
under the government’s new scheme.
LEIcESTERShIRE cARES
This year we have become official
members of “Leicestershire cares” who
are a local charity organisation who
enable businesses to support the local
community through employees’ giving
up their time to help with various
community initiatives.
Supporting Leicestershire cares is
fully aligned to our general focus
on colleague engagement and
also provides further development
opportunities for our people. we have
agreed to do five “team challenges”
this year which involve teams from
across our Leicestershire headquarters
going out to support various one
day community projects – such as
maintenance of community facilities.
Leicestershire cares offers a range of
ways to support the community beyond
the ‘team challenges’ so this is an
exciting partnership with the potential
to grow over time.
Macmillan Cancer Support
Topps colleagues voted to
support macmillan following a
company-wide ballot
Leicestershire Cares
2015 saw Topps become
official members of
Leicestershire cares
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cOnT In uEd
EnvIROnmEnTAL I mPAcT
To ensure that Topps can become
a more sustainable business our
environmental programme has focused
on three key areas – reducing the
energy used in our stores, waste
recycling and lowering the emissions
from our transport fleet.
In our stores lighting and heating has
both a major environmental and cost
impact on the business; to reduce this
we have taken the following steps.
• Since October 2013 all our electricity
has come from renewable sources;
• we have replaced old inefficient
lighting in our stores with modern
low energy use equipment; and
• To help us accurately monitor and
control our use of energy we are
working with our utility provider to
install smart meter systems in all our
stores. This programme together
with our continuing review of new
technologies in this field will help
us in being able to make further
energy use reductions wherever we
identify opportunities.
carbon emissions from the business
are included within the directors’
Report section of this document.
wASTE
we continue to recover several types
of recyclable waste from stores for
processing at our distribution centre
in Leicester.
In our all of our stores we have
a system of dry mixed recycling.
This enables cardboard, paper,
newspaper, plastic film, bottles, steel,
aluminium cans all to be collected by
our refuse partner using only one bin.
In parallel we have recycling facilities
in all our offices for paper, cardboard,
hard plastics and cans.
In addition, old IT equipment is also
included in our waste management
programme. we use our own transport
fleet to ensure that store generated
waste is brought to our distribution
centre at grove Park in Leicester for
onward transport for recycling. The
number of journeys for this purpose is
minimised by the use of compaction
techniques.
At our distribution centre, we continue
to reduce the amount of waste going to
landfill by segregating waste into seven
distinct streams, namely polypropylene
banding, plastic, polythene, cardboard,
scrap metal, wooden packaging, tiles
and end of life pallets all of which are
segregated and processed through our
recycling partner.
As part of our commitment to our
environmental agenda, we are also
working on a project that aims to see
us at 0% landfill from our store waste by
the end of 2017. This will include new
waste facilities for stores and providing
them with full visibility of their waste
costs, so they can monitor and track
how they are performing as a store.
TRAnSPO RT
Our vehicle fleet covered 3,144,682
kilometres last year delivering stock to
our stores. we are constantly looking
for ways to improve the efficiency of
our transport operation, which can in
turn reduce the amount of emissions
produced.
In july 2015, we made significant
changes to our network which saw the
introduction of transport outbases – we
now have six regional stockless depots
which are used for making deliveries
to stores. The operating principle is
to maximise the use of each vehicle
by using them to deliver to stores by
day then moving stock between the
distribution centre and the outbases
by night.
In 2016, we will explore further
opportunities to improve our vehicle
utilisation. This may include delivering
to some of our stores outside of normal
trading hours, in order to maximise
transport efficiency. To support this,
we are currently trialling a very low
noise electric version of our truck-
mounted forklifts. The transport industry
is becoming increasingly focused on
low noise technology for deliveries in
urban areas and we have provided
information to Transport for London
as part of a case study into the new
forklift technology.
we procured four new mAn Euro 6
vehicles in 2015, which are already
showing improved fuel efficiency
compared to the rest of the fleet. we
will procure up to a further 10 vehicles
in early 2016 as part of a rolling fleet
replacement programme.
Our teams continue to “backhaul”
stock directly from seven of our uk
suppliers. This is the collaborative
principle of using our own transport to
collect stock from suppliers while our
vehicles are already out making other
deliveries, therefore reducing overall
vehicle movements in the supply chain.
we are in the process of installing
digital video recording equipment
across our fleet. This is designed
to improve the insurance claims
experienced in the event of an incident
and is starting to be adopted across
many other commercial vehicle fleets.
In April of this year, we also changed
our home delivery service from over
250 providers to one nationwide
provider meaning that we can
consolidate orders and utilise our
suppliers fleet to minimise our carbon
footprint.
30
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we go miles for the love of
tiles!
we have a policy on timber products
and have adopted the principles and
criteria of the forest Stewardship
council as our benchmark.
Our full policy can be found on our
website at www.toppstiles.co.uk in
the investor section under corporate
Responsibility.
Read more about our Corporate
Responsibility online at
www.toppstiles.co.uk
Through 2014 we comprehensively
reviewed all of our product suppliers
from an ethical and environmental
sourcing stance. All our ongoing
product supply partners meet
standards we would expect and are
100% compliant with our ethical
sourcing & environmental programmes.
All our ceramic & porcelain tiles
and natural stone products are fully
compliant with European standards;
all boxes and crates carry the
cE marking. The declaration of
Performance (dOP) certificates are
available upon request and are held
on our cE database.
SuPPL y chAIn
we source the products we sell from
around the world to bring the latest
styles and designs to the uk market.
To address any possible concerns
that affect labour standards, factory
conditions and human rights, our
buyers and buying agents conduct
regular supplier visits and factory tours
to ensure that all contracts for supply
of goods include our requirements in
relation to each of these issues.
All of our suppliers comply with our
Ethical Sourcing & Environmental
programme which covers two main
principles:
• Employing a free, safe and fairly
treated workforce
• compliance with all environment
legislation, optimised recycling and
minimising environmental impact
31
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cOnT In uEd
OuR PEOPLE
Our colleagues are a central focus for
us and we want to ensure they have
the right capabilities and that they feel
engaged and proud of working for
Topps. In doing this we strive to create
an environment across all areas of the
business which is inspiring to both our
employees and our customers.
cOLLEAguE wELLbEIng
we provide a helpline service for all
colleagues to give them a channel
for expressing concerns and seeking
advice regarding workplace issues.
Our in-house health & Safety team
also maintain a regular dialogue with
colleagues. They carry out periodic
inspections and assessments to ensure
risks are minimised or removed in our
stores, warehouse and offices.
To promote effective communication
and employee involvement, we also
operate a health & Safety committee,
which meets on a bi-annual basis and
is chaired by a main board director,
Rob Parker.
we also provide an Employee
Assistance Programme to give all
employees access to information,
resources and counselling to help
balance work, family and personal life.
cOmmunIcATIOn And
EngAgEmEnT
communication with our colleagues is
vital and we have a plan and various
initiatives in place to ensure regular
and effective dialogue.
we have a number of existing
communication channels, including
an internal magazine, quarterly h&S
bulletin and a weekly stores bulletin
and we have just introduced a text
service where colleagues can register
to receive key business updates from
the chief Executive directly to their
mobile phone. moreover, we have an
intranet which is a key engagement
tool and acts as a “one-stop shop” for
all information that colleagues across
the business require.
during the year we conducted
our largest ever conference for all
our managers. At this event, we
celebrated the achievement of our
previous strategic goal, communicated
our refreshed strategy for the business
and outlined the part every colleague
can play in helping us to achieve the
next stage of the company’s success.
Our colleague representative forum
(“TEAm Talk”) is now firmly embedded
across the entire business and
continues to provide a framework for
colleagues to participate in two-
way communication, giving them a
platform from which to help shape and
influence decision making within the
group.
As an initiative to measure, recognise
and improve colleague engagement
levels, we have once again completed
the best companies annual survey.
Last year we were awarded the best
companies ‘Ones to watch’ status
(fourth category) and we achieved
this status again in 2015 but with
a positive like for like improvement
on our overall engagement score.
Our aspiration is now to continually
improve our colleague engagement
levels and move from best companies
fourth category into their first category
over the next five years.
we have reviewed and re-established
our core “behaviours” that we wish
to ensure each and every colleague
within the company demonstrates.
we have this year introduced these
behaviours to our senior team to
ensure they are firmly embedded
and consistently demonstrated by our
leaders before cascading these to all
other colleagues next year.
we also have two initiatives planned
this year to specifically develop our
internal and external employee brand
in a drive to attract and retain the
talent needed to support our growth
plans. These are to review our
careers website and clearly define our
employee value proposition.
Rewarding our employees for all their
hard work is part of the Topps ethos
and everyone has the opportunity
to enhance their basic pay through
additional performance-related
incentives. In 2015 we increased our
standard basic pay over and above
the national minimum wage for all
colleagues. The company operates
a “save as you earn” plan which
is open to all colleagues and gives
everyone the opportunity to become
a shareholder in the business on
advantageous terms.
In addition to the above measures,
we have an annual “back to the floor”
programme where every member of
the senior management team spends
time working in our stores – we
believe this provides us with a much
greater level of understanding of our
business and remains an integral part
of positive customer and colleague
focused culture.
32
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Strategic reportwww.toppstiles.co.uk Stock code: tpt cASE STUdy
cOLLEAguE
training &
development
...
Topps Tiles Store manager, nick gadd from fulham, was
awarded the South-East nOcn Learning at work Award at
the Adult Learners’ week Awards 2015.
Praised for using his Retail management Advanced
Apprenticeship to guide and lead a unified workforce, nick
used the skills he had learnt to build a motivated team.
he created a special ambience that ultimately turned the
Topps Tiles fulham branch into a high performing store,
with exceptional levels of customer service and employee
engagement.
Award winner
nick gadd accepting the
nOcn Learning at work
award
Read more about our Corporate Responsibility
online at www.toppstiles.co.uk
EmPLOyEE dEvELOPmEnT
As a group we actively encourage
employee development, we have a
strong culture and history of growing
and developing our people from within
the organisation and it is important
to us that our employees fulfil their
potential during their time at Topps.
Around 80 colleagues from across
the business are currently enrolled
on either a Retail or Team Leading
Apprenticeship, both of which are
delivered by our in-house team of
qualified assessors.
upon completion of their
Apprenticeship, these colleagues
will increase the overall number of
participants that have benefitted from
the programme to more than 800 in
six years.
In addition to the various
apprenticeship qualifications, we
continue to deliver training that
supports our latest products, processes
and services both in the classroom and
online. we also provide softer skills
development for colleagues across the
business.
This year we have also outlined our
three year learning & development
(“L&d”) plan to further increase the
quality and quantity of our support
available to all colleagues with the
objective of increasing capability
levels across the business.
33
Around 80 colleagues
are currently enrolled on an
Apprenticeship
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015OveRviewStRAtegic RepORtgOveRnAncefinAnciAl StAtementSAdditiOnAl infORmAtiOn gOvE RnAn cE
www.toppstiles.co.uk Stock code: TPT
cASE STUdy
wORLd-cLASS
customer
service
...
Our store colleagues continue to provide
world-class customer service and are being
further trained to deliver an even greater
inspirational shopping experience.
Our Colleagues:
Raj, matthew and kristian
Our Colleague: Rob
we are dedicated to providing world
class levels of customer service
Read more about our Inspiration
Strategic Pillar on page 12
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OvE RvI Ew
ST R AT EgIc R E P O R T
gOvE RnAn cE
fInAn cI A L S TAT EmEnT S
Ad dI T I OnA L In fO RmAT I On
Governance
C o n t e n t s
36 bOARd Of dIREcTORS
38 dIREcTORS’ REPORT
43 cORPORATE gOvERnAncE STATEmEnT
48 REmunERATIOn REPORT
for many years, Topps Tiles stores have
delivered excellent customer service and
this has been illustrated by continued
improvement in net Promoter Scores
which are well ahead of the competition
(independent surveys).
Other brand audit and mystery shop
research supports this and the top 5
words most frequently used to describe
Topps are: friendly, helpful, value,
knowledge, professional.
35
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015 Board Of dIREcTORS
5
3
2
1
4
6
1 dARREn ShAPLAn d
NON-ExECuTIvE ChAIRMAN
darren has over 25 years of retail and public
company experience, having held senior financial
and operational positions within The burton
group, Arcadia and kingfisher. darren was chief
financial Officer at j Sainsbury’s plc. between
2005 and 2010 before being appointed group
development director, a position he held between
2010 and 2011. he was also non-Executive
chairman of Sainsbury’s bank from 2006 to
2013 and chief Executive of carpetright plc.
from 2012-2013.
darren is currently chairman of Poundland group
Plc and non-Executive director and chairman of
the Audit committee at wolseley Plc.
2 mATThEw wILLI AmS
ChIEF ExECuTIvE OFFICER
matt joined the company in 1998 as Property
director soon after its IPO. he spent the next
six years expanding the company’s store base,
acquiring more than 200 new sites, which still
make up a large part of the store portfolio today.
Promoted to the role of chief Operating Officer
in 2004 and joining the PLc board in 2006, he
was a key member of the team that established
Topps as the leading specialist tile retailer in the
uk. In 2007 he was promoted to chief Executive
Officer. matt is also a non-executive director of
The Original factory Shop.
3 RObERT P ARkER
C hIEF FINANCIAL OFFICER
Rob joined Topps Tiles in 2007 as finance
director. Rob’s previous role before joining the
group was director of finance & IT for Savers
health & beauty Ltd. Prior to that Rob was with
the boots group Plc for 10 years, ultimately as
director of finance for boots Retail International.
he is responsible for all aspects of finance,
human resources, property, IT, and company
legal matters.
4 kE ITh dOwn (c, d, E )
NON-ExE CuT IvE DIR EC TOR
keith is a chartered accountant and is currently the
chief financial Officer of dunelm group Plc, and
has held this post since december 2015. he was
previously the group finance director of the go-
Ahead group Plc and jd wetherspoon plc. keith
joined the board of Topps Tiles in february 2015.
5 cLAIR E TInEy
NON-ExE CuT IvE DIR EC TOR
(b, f , d, h)
claire runs her own business as an hR
consultant, Executive coach and facilitator,
having spent 15 years as an Executive director
in a number of retail businesses including
mothercare and wh Smith. most recently she
was hR director at mcArthurglen, the developer
and owner of designer outlet villages throughout
Europe. She was previously a non-Executive
director of family mosaic and is also a non-
Executive director of grey 4 gold. claire joined
the board of Topps Tiles in november 2011.
6 Andy k Ing (g, E , h)
NON-ExE CuT IvE DIR EC TOR
Andy is the managing director of dobbies
garden centres. Previously he was chief
Executive of notcutts garden centres for five
years and prior to that he held global marketing
director roles at The body Shop, mothercare and
wh Smith, having previously spent nine years at
boots The chemists. until december 2011 Andy
was a non-executive director at The chartered
Institute of Environmental health. Andy joined the
board of Topps Tiles in january 2012.
36
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STuART dA vEy (A)
CO MPA Ny SECR ETAR y
AN D SEC RE TA R y O F
BO A RD SuBC OM MI TT EES
Stuart qualified as a Solicitor in 1987.
he joined Topps Tiles in 2005 having
previously worked in private practice
and in house with national westminster
bank Plc. Stuart became group Lawyer
in 2010 and was appointed company
Secretary in September 2014.
A. Secretary of the Audit, nomination and
Remuneration committees
B.
Senior Independent director
C.
chairman of Audit committee
d.
member of nomination committee
e. member of Remuneration committee
F. chairman of Remuneration committee
G.
chairman of nomination and
governance committee
member of the Audit committee
h.
www.toppstiles.co.uk Stock code: TPTgovernance Executive
TEAm
mATThEw wILLIAmS
ChIEF ExECuTIvE OFFICER
RObERT P ARkER
ChIEF FI N ANC IAL OF FI CE R
bRIAn LInnIngTOn
COMMERCIAL DI RE CTOR
A chemistry graduate with an mbA,
brian Linnington has many years retail
business experience starting his career at
boots where his roles included category
general manager Toiletries, International
country manager for holland and then
Taiwan and finally multichannel director
for boots uk. Prior to joining Topps Tiles
in december 2012 brian was Product
and marketing director at vision Express
for four years. brian is responsible for all
aspects of buying, marketing and online
in Topps.
RIchARd cARTE R
OPER AT IO NS DI R ECTO R
Richard is an experienced retailer who
has worked for both blue chip retailers
as well as smaller more entrepreneurial
businesses. Richard has previously held
senior operations roles with the Spirit
group (Punch Taverns), virgin Retail,
dixons, Office world (Staples) and
started his career with Asda on their
retail operations graduate recruitment
programme. Richard joined Topps in
2010 and has accountability for retail
operations, supply chain and the trade
customer division.
OuR
Advisors
...
SEcR ETAR y
S. davey
REgIS TER Ed nu mbER
3213782
REgIS TER Ed Of fIcE
Thorpe way, grove Park
Enderby, Leicestershire
LE19 1Su
AudI TO R
deloitte LLP
manchester, united kingdom
bAn kE RS
barclays bank Plc
3 hardman Street, Spinningfields,
manchester, m3 3hf
REgIS TRA RS
capita IRg Plc, bourne house,
34 beckenham Road, beckenham,
kent, bR3 4Tu
SO L IcITO R S
Osborne clark
One London wall, London, Ec2y 5Eb
fInAncI AL P R Ad vIS ORS
citigate dewe Rogerson
3 London wall buildings
London, Ec2m 5Sy
bR OkER S
Peel hunt, moor house,
120 London wall, London, Ec2y 5ET
Liberum, Ropemaker Place,
25 Ropemaker Street, London
Ec2y 9Ly
37
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information Directors’ REPORT
The directors present their Annual
Report on the affairs of the group,
together with the financial Statements
and Auditor’s Report, for the 53 week
period ended 3 October 2015. The
corporate governance Statement set
out on pages 43 to 47 forms part of
this report.
The company conducts an annual
strategic risk discussion with the
Audit committee chairman and
senior managers from the business
which includes a wide range of
risks including commercial, continuity
and environmental, social and
governance risks.
PRIncIPAL AcTIvITy
RESuLTS An d dIvIdEn dS
The principal activity of the group
comprises the retail distribution of
ceramic and porcelain tiles, natural
stone, wood flooring and related
products.
STRAT EgIc REvIEw
The company, being the listed entity
Topps Tiles Plc, is required by the
companies Act to set out in this report
a fair review of the business of the
group during the financial period
ended 3 October 2015 and of the
position of the group at the end of
that financial period. we are also
required to set out a description of the
principal risks and uncertainties facing
the group.
The information that fulfils the
requirements of the Strategic Review
can be found within the chairman’s
statement on page 4, the Strategic
Report on pages 8 to 27, and the
corporate Social Responsibility
statement on pages 28 to 33, which
are incorporated in this report by
reference. The future prospects of the
group are highlighted in both the
chairman’s and the Strategic Report.
The directors monitor a number
of financial and non-financial key
performance indicators (kPIs) for
the group and its stores. The most
significant of these are detailed on
page 18.
The audited financial Statements for
the 53 week period ended 3 October
2015 are set out on pages 71 to
103.
The group’s profit for the period
from continuing operations, after
taxation, was £13,065,000 (2014:
£12,512,000).
during the interim period a dividend of
0.75 pence per share was declared
and paid (2014: interim dividend of
0.65 pence per share was paid).
following careful consideration, and
for the reasons given in the chairman’s
statement of this report, the board
is recommending the payment of a
final dividend of 2.25 pence per
share, totalling £4,358,000 (2014:
1.60 pence per share, totalling
£3,098,000).
dIREcTOR S
The directors of the company, who
served throughout the year and
thereafter, were as follows:
d Shapland non-Executive chairman
mTm
williams
R Parker
c Tiney
A king
k down
chief Executive Officer
chief financial Officer
Senior Independent
non-Executive director
non-Executive director
non-Executive director
In line with the updated code on
corporate governance all directors
are subject to annual re-election at the
next Annual general meeting.
All resolutions at the Annual general
meeting are passed on a show of
hands, in line with our Articles of
Association. The results of the votes
polled in advance are also disclosed
to members present and in the event
that the polled votes did not support
the resolution the chairman would
formally call for a poll, thereby
ensuring that all members interests are
represented.
The company provides insurance
against directors’ and Officers’
liabilities to a maximum value of
£10,000,000.
The directors’ interests in the shares of
the company are set out on page 62.
details of directors’ share options are
provided in the directors’ Remuneration
Report on pages 60, 61 and 62.
ShAR E cAP ITAL
details of the company’s authorised
and issued share capital, together
with details of the movements in
the company’s issued share capital
during the period, are shown in note
20 to the financial Statements. The
company has one class of ordinary
shares in issue, which carry no right to
fixed income. Each share carries the
right to one vote at general meetings
of the company.
There are no specific restrictions
on the size of a holding nor on the
transfer of shares, which are both
governed by the general provisions
of the Articles of Association and
prevailing legislation. The directors are
not aware of any agreements between
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www.toppstiles.co.uk Stock code: TPTgovernance holders of the company’s shares that
may result in restrictions on the transfer
of securities or on voting rights.
no person has any special rights
of control over the company’s share
capital and all issued shares are
fully paid.
chAngE Of cOnTROL –
SIgnIfIcAnT AgREEmEnTS
The group is party to significant
agreements, including commercial
contracts, financial and property
agreements and employees’ share
plans, which contain certain
termination and other rights for the
counter parties upon a change of
control of the company. Should the
counter parties choose to exercise
their rights under the agreements on a
change of control such arrangements
would need to be renegotiated.
none of these are considered to
be significant in terms of the likely
impact on the business of the group
as a whole. There are no agreements
between any group company and
any of its employees or a director
of the company which provides
for compensation to be paid to the
employee or director for termination
of employment or for loss of office as
a consequence of a takeover of the
company, other than provisions that
would apply on any termination of
employment.
SuPP LIE R PA ymEnT PO L Icy
The group’s policy is to negotiate
terms of payment with suppliers
when agreeing the terms of each
transaction, ensuring that suppliers
are made aware of the terms of
payment and that both parties abide
by those terms. The effect of the
group’s negotiated payment policy
is that trade payables at the period
end represented 46 days purchases
(2014: 54 days). Trade payables
days is calculated by dividing the
trade and other payables by the
aggregate of cost of sales and
relevant non inventory expenditure,
multiplied by 365 days across all
periods, to aid comparability.
cARbOn REP O RTIng
As detailed in the cSR section of
this report on page 30 our primary
energy consumption is electricity
used across our store estate. In-store
lighting is a major driver of overall
consumption and we have been
working on installing modern, energy
efficient lighting for the last few years.
we continue to experiment with new
technology to establish its suitability for
our business. Emissions per store are
calculated on average stores across
the year.
Energy carbon emissions has been
compiled in conjunction with our
supplier (SSE) and is based on the
actual energy consumed multiplied
by Environment Agency approved
emissions factors.
vehicle emissions has been calculated
by our in-house transport team based
on mileage covered multiplied
by manufacturer quoted emission
statistics.
chARI TAbL E An d PO LI TIcAL
cOnT RIbuTI OnS
The group has a designated
charitable partner, the macmillan
Trust. Across the business colleagues
engage in numerous fundraising
activities which are document in the
cSR section of this report. during the
period the group made no monetary
charitable donations (2014: £nil). The
group made no political contributions
(2014: £nil).
Su bSTAnTI AL ShAREhO LdIn gS
In addition to the directors’
shareholdings noted on page 62, as
at 3 October 2015 the company
had been notified, in accordance
with chapter 5 of the disclosure and
Transparency Rules, of the following
interests in 3% or more of its issued
share capital.
ELEcTRIcITy
gAS & OIL
cOmmERcIAL fLEET
cOmPAny cARS
TOTAL
2015
2014
co2
(TonnES)
co2
(TonnES)/
SToRE
co2
(TonnES)
co2
(TonnES)/
SToRE
6,563
2,716
2,922
386
19.3
8.0
8.6
1.1
8,794
2,606
2,754
373
12,587
36.9
14,527
26.7
7.9
8.4
1.1
44.2
39
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information
Directors’ REPORT
cOnT In uEd
wILLIAmS S k m ESq
bLAckROck InvESTmEnT mgT (uk)
AxA InvESTmEnT mAnAgERS SA
InvEScO ASSET mAnAgEmEnT
SchROdER InvESTmEnT mgT
AvIv A PLc & ITS SubSIdIARIES
cAPITAL RESEARch gLObAL InvESTORS
In addition to the above shareholdings
between the 3 October 2015 and
the 7 december 2015 we have been
notified of the following changes in
shareholdings:
• Old mutual increased their holding
to 9,742,079 on the1 October
2015
• Aviva plc & its subsidiaries reduced
their holding to 7,710,497 on the
8 October 2015
• Invesco Limited increased their
holding to 9,688,829 on the
19 October 2015
• Old mutual decreased their holding
to 9,625,922 on the 2 november
2015
• Old mutual increased their holding
9,681,392 on the13 november
2015
• Aviva plc & its subsidiaries
increased their holding to
7,908,126 on the 19 november
2015
• Aviva plc & its subsidiaries reduced
their holding to 7,614,853 on the
26 november 2015
nUmbER
20,593,950
20,271,483
19,213,670
9,679,056
8,216,970
7,746,366
5,906,000
% hELd
10.6%
10.5%
9.9%
5.0%
4.2%
4.0%
3.0%
cORPOR ATE SOcI A L
RES POnSIbI LI Ty
Topps has a long standing corporate
Social Responsibility (cSR) agenda
covering community & charity,
Environment and Our People. The full
detail of our current cSR activities
is detailed in this report. we take
the impact of our business on our
environment extremely seriously
and have included a range of
environmental metrics within the
directors’ Report Section of this report.
Read about Corporate Social
Responsibility on pages 28 to 33
humAn RIg hTS
we are also very mindful of human
rights issues within our organisation.
The key area in which this would
impact our business is in our supply
chain. All of our directly employed
colleagues are based in the uk and
covered by uk employment law, with
which we are fully compliant. within
our supply chain we source from
factories in many countries around the
world. Our specialist team of buyers
and their agents personally inspect
factory facilities to satisfy themselves
with regard to working conditions
before new suppliers are engaged.
we also have commercial agreements
in place that require our suppliers to
be fully compliant with local laws and
we pay particular attention to labour
standards and factory conditions. no
issues were raised during the year.
dIvER SI Ty
The nomination and governance
committee reviews the balance of
skills, knowledge and experience on
the board regularly. Its policy with
regard to gender is that we recognise
the need for a greater level of diversity
across all levels in our organisation;
however, we do not endorse positive
discrimination and encourage
colleagues to appoint the very best
possible candidate to the post. during
the year we have seen an improvement
in overall diversity but also recognise
that within our senior manager
population we are lacking diversity.
Our workforce at period end date comprises:
dIREcTORS
SEnIOR mAnAgERS
OThER EmPLOyEES
ToTAL EmPLoyEES
% of ToTAL
40
2015
2014
mALE
fEmALE
ToTAL
mALE
fEmALE
ToTAL
6
16
1,523
1,545
1
0
401
402
7
16
1,924
1,947
79.4%
20.7%
5
14
1,459
1,478
81.3%
1
0
338
339
18.7%
6
14
1,797
1,817
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www.toppstiles.co.uk Stock code: TPTgovernance
I nfORmATIOn gIvEn TO ThE
AudI TO R
Each of the directors at the date of
approval of this annual report confirms
that:
• So far as the director is aware,
there is no relevant audit
information of which the company’s
auditor is unaware; and
• The director has taken all the steps
that ought to have been taken as a
director in order to make himself/
herself aware of any relevant audit
information and to establish that the
company’s auditor is aware of that
information.
This confirmation is given and should
be interpreted in accordance with the
provisions of s418 of the companies
Act 2006.
Au dI TOR
A resolution to re-appoint deloitte
LLP as the company’s auditor will be
proposed at the forthcoming Annual
general meeting.
EquAL OPPORTunITIES
ShARE O PTI On Sc hEmES
The directors recognise the importance
of motivating employees and
believe that one of the most effective
incentives is increased employee
participation in the company through
share ownership.
This has been achieved through the
introduction of a number of employee
Sharesave, share bonus, approved
and unapproved share option
schemes, since the flotation in 1997.
The total number of options held by
employees, including directors, is
7,946,737 (2014: 6,338,668).
As described in note 28, employee
share purchase plans are open to
almost all employees and provide for
a purchase price equal to the daily
average market price over the 3
days preceding the start of the offer
period, less 20%. The shares can
be purchased during a two week
offer period, which during the period
ended 3 October 2015 fell between
5th january 2015 and 21st january
2015, the offer price to employees
was 92 pence.
details of directors’ share options are
provided in the directors’ Remuneration
Report on pages 60, 61 and 62.
At Topps Tiles we are committed to
equal opportunities and ensure that
we hire on potential, promote on
talent and reward on success. we
aim to promote equality of opportunity
in employment regardless of age,
gender, colour, ethnic or national
origin, culture, religion or other
philosophical belief, disability, marital
or civil partnership status, political
affiliation, sexual identity or sexual
orientation
EmPLOyEE cOnSuLTATIOn
The group places considerable
value on communication with and
involvement of employees and has
continued to keep all employees
informed on matters affecting them
and on the various factors affecting
the performance of the group. This is
achieved through formal and informal
meetings, electronic announcements
and the company magazine. Regular
forums have been established to
ensure that employee representatives
are consulted on a wide range of
matters affecting their current and
future interests.
fInAncIAL RISk mAnAgEmEnT
ObjEcTIvES And P OLIcI ES
,
The group is exposed to certain
financial risks, namely interest rate
risk, currency risk and credit risk.
Information regarding such financial
risks is detailed in notes 14,15,16,17
and 18. The group’s risk management
policies and procedures are also
discussed in the Strategic Report on
pages 19 to 27.
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Directors’ REPORT
cOnT In uEd
In preparing the group financial
statements, International Accounting
Standard 1 requires that directors:
RE SPOnSIbIL I Ty S TATEmEnT
we confirm that to the best of our
knowledge:
• the Annual Report and financial
statements, taken as a whole, are a
fair, balanced and understandable
and provide the information
necessary for shareholders to
assess the company’s performance,
business model and strategy;
• the financial statements, prepared
in accordance with the relevant
financial reporting framework, give
a true and fair view of the assets,
liabilities, financial position and
profit or loss of the company and
the undertakings included in the
consolidation taken as a whole;
and
• the management report, which is
incorporated into the directors’
report, includes a fair review of
the development and performance
of the business, the position of the
company and the undertakings
included in the consolidation
taken as a whole, together with a
description of the principal risks
and uncertainties that they face.
by order of the board
R Parker
director
1 december 2015
• properly select and apply
accounting policies;
• present information, including
accounting policies, in a manner
that provides relevant, reliable,
comparable and understandable
information;
• provide additional disclosures
when compliance with the specific
requirements in IfRSs are insufficient
to enable users to understand the
impact of particular transactions,
other events and conditions on
the entity’s financial position and
financial performance; and
• make an assessment of the
company’s ability to continue as
a going concern.
The directors are responsible for
keeping adequate accounting records
that are sufficient to show and explain
the company’s transactions. They
must also disclose with reasonable
accuracy, at any time, the financial
position of the company and
enable themselves to ensure that the
financial statements comply with the
companies Act 2006. They are also
responsible for safeguarding the assets
of the company and hence for taking
reasonable steps for the prevention
and detection of fraud and other
irregularities.
The directors are responsible for the
maintenance and integrity of the
corporate and financial information
included on the company’s website.
Legislation in the united kingdom
governing the preparation and
dissemination of financial statements
may differ from legislation in other
jurisdictions.
dIREcTORS’ RESPOnSIbI LI TIES
STATEmEnT
The directors are responsible for
preparing the Annual Report, directors’
Remuneration Report and the financial
statements in accordance with
applicable law and regulations.
company law requires the directors
to prepare financial statements for
each financial year. under that law
the directors are required to prepare
the group financial statements
in accordance with International
financial Reporting Standards (IfRSs)
as adopted by the European union
and Article 4 of the IAS Regulation.
They have elected to prepare the
parent company financial statements
in accordance with united kingdom
generally Accepted Accounting
Practice (united kingdom Accounting
Standards and applicable law). under
company law the directors must not
approve the accounts unless they are
satisfied that they 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 the parent company
financial statements, the directors are
required to:
• select suitable accounting policies
and then apply them consistently;
• make judgments and accounting
estimates that are reasonable and
prudent;
• state whether applicable uk
Accounting Standards have been
followed, subject to any material
departures disclosed and explained
in the financial statements; and
• prepare the financial statements on
the going concern basis unless it is
inappropriate to presume that the
company will continue in business.
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www.toppstiles.co.uk Stock code: TPTgovernance
Corporate gOvE RnAncE STATEmEnT
ThE bOARd hAS REvIEwEd
ThE cOnTEnTS Of ThIS
REPORT And cOnSIdER
ThE dOcumEnT TO bE
fAIR, bALAncEd, And
undERSTAndAbLE And An
AccuRATE REPRESEnTATIOn
Of ThE cuRREnT POSITIOn
Of ThE buSInESS.
Darren Shapland
ChAIRMAN
Dear shareholder
...
The company is committed to the principles of corporate
governance contained in the 2012 uk corporate
governance code issued by the financial Reporting
council (“the code”) for which the board is accountable
The board has agreed to seek to comply with the provisions
of the 2014 uk corporate governance code at the
earliest opportunity and as a result the board early adopted
the requirement to produce a viability statement and is
currently working to the updated code on internal controls.
The board has reviewed the contents of this report
and consider the document to be fair, balanced, and
understandable and an accurate representation of the
current position of the business. The basis for this view
is that all of the directors are furnished with the requisite
information to perform their duties and are provided access
to key members of management as they require. The board
meet regularly and are given adequate time to probe,
debate and challenge business performance as and when
they consider it necessary to do so. The board has also
discussed the detail of the financial results with the Audit
committee and are satisfied they have been prepared
appropriately. having gained a thorough understanding
of the business each member has also had the opportunity
to review and influence this report and as such have
concluded in line with the statement above.
STATEmEnT Of cOmPL IAncE wI Th ThE c OdE
The company has applied the principles set out in
the code, including both the main Principles and the
supporting principles, by complying with the code as
reported above. further explanations of how the main
Principles have been applied are set out below and in the
directors’ remuneration report and Audit committee report.
during the year the board undertook an evaluation of the
Audit, Remuneration and nomination and governance
committee processes and performance of the chairs
of these sub-committees. we have agreed some minor
refinements following this review.
In addition each board member completed a detailed
evaluation of the chairman’s performance on completion of
six months of the role.
Overall the evaluation process was very positive identifying
on-going training and education as an area board
members would like to be further developed and
a programme is being implemented to enhance this area.
The financial year has seen significant changes in terms
of the composition of the board with the retirement of both
the Rt.hon. michael jack as chairman and Alan white as
the senior independent non-executive director and chair
of the Audit committee. keith down was appointed as
non-executive director and chair of the Audit committee
in february 2015 and I was appointed non-Executive
chairman in march 2015. The board of directors currently
comprises six members, of which four are considered
43
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cOnT In uEd
independent. The Senior Independent
non-Executive director is claire Tiney,
who also chairs the Remuneration
committee. brief biographical details
of all directors are given on pages 36
and 37. The board meets at least ten
times a year. certain defined issues
are reserved for the board including
approval of financial Statements
and circulars, annual budgets,
strategy, directors’ appointments,
internal control and risk management,
corporate governance, key external
and internal appointments and
pensions and employee incentives.
board members are responsible
for their own development but are
provided access to the company’s
advisors and regularly attend external
presentations and workshops on areas
considered relevant and appropriate,
including environmental, social and
governance issues. In particular all
members of the board have access
to the deloitte Academy in London
which offers seminars and professional
updates on a range of relevant topics
useful to enhancing the board’s
knowledge and understanding of
corporate governance. Provision has
also been made within the boards
timetable for regular updates in
relation to areas including executive
remuneration, the market and
corporate governance.
In advance of board meetings
directors are supplied with up to
date information about trading
performance, the group’s overall
financial position and its achievement
against prior year, budgets and
forecasts.
where required, a director may seek
independent professional advice at
the expense of the company. All
directors have access to the company
Secretary and they may also
address specific issues to the Senior
Independent non-Executive director.
All directors are subject to annual re-
election. directors are elected at the
first Agm after appointment. All non-
Executive directors have written letters
of appointment.
The board acknowledges the code’s
position with respect to the potential
loss of independence of non-Executive
directors who have served more than
nine years and that the chairman
(the Rt.hon. michael jack) exceeded
this term. during this period the
board included three independent
non-Executive directors out of a
total board of six members reflecting
corporate governance best practice.
Subsequently darren Shapland was
appointed after the company’s Agm
to facilitate a smooth transition on the
retirement of the Rt.hon. michael jack
from the board. The board considers
that, darren Shapland, claire Tiney,
Andy king and keith down are
independent for the purposes of the
code. The terms and conditions for
the appointment of non-Executive
directors are available for inspection
on request.
The board review the independence
of non-Executive directors on an
ongoing basis.
The board operates three committees.
These are the nomination and
governance committee, the
Remuneration committee and the Audit
committee. All of these committees
meet regularly and have formal written
terms of reference which are available
for inspection on request.
ATTEndAn cE AT bOA Rd And c Om mI TT EE mE E T IngS
The following table shows the number of board and committee meetings held
during the 53 week period ended 3 October 2015 and the attendance record
of the individual directors.
BOARD
AUDIT
COMMITTEE
NOMINATION &
GOVERNANACE
COMMITTEE
J.M. JACK
D. SHAPLAND
M.T.M.
WILLIAMS
R. PARKER
A. WHITE
C. TINEY
A. KING
K. DOWN
5
MEETINGS OF
A POSSIBLE 12
7
MEETINGS OF
A POSSIBLE 12
12
MEETINGS OF
A POSSIBLE 12
12
MEETINGS OF
A POSSIBLE 12
2
MEETINGS OF
A POSSIBLE 12
12
MEETINGS OF
A POSSIBLE 12
12
MEETINGS OF
A POSSIBLE 12
8
MEETINGS OF
A POSSIBLE 12
1
MEETINGS OF
A POSSIBLE 2
1
MEETINGS OF
A POSSIBLE 2
2
MEETINGS OF
A POSSIBLE 2
2
MEETINGS OF
A POSSIBLE 2
1
MEETINGS OF
A POSSIBLE 2
2
MEETINGS OF
A POSSIBLE 2
2
MEETINGS OF
A POSSIBLE 2
1
MEETINGS OF
A POSSIBLE 2
6
MEETINGS OF
A POSSIBLE 6
0
MEETINGS OF
A POSSIBLE 6
6
MEETINGS OF
A POSSIBLE 6
6
MEETINGS OF
A POSSIBLE 6
0
MEETINGS OF
A POSSIBLE 6
6
MEETINGS OF
A POSSIBLE 6
6
MEETINGS OF
A POSSIBLE 6
0
MEETINGS OF
A POSSIBLE 6
REMUNERATION
COMMITTEE
£
1
MEETINGS OF
A POSSIBLE 3
2
MEETINGS OF
A POSSIBLE 3
n/a
MEETINGS OF
A POSSIBLE 3
n/a
MEETINGS OF
A POSSIBLE 3
1
MEETINGS OF
A POSSIBLE 3
3
MEETINGS OF
A POSSIBLE 3
3
MEETINGS OF
A POSSIBLE 3
2
MEETINGS OF
A POSSIBLE 3
44
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www.toppstiles.co.uk Stock code: TPTgovernance The role of the
b O A Rd Of dIREcTORS
The board of directors has overall responsibility for approving our company strategy and the governance of the business.
The primary goal of the board is to ensure that the company is being run in the best long term interests of both the
company itself and all of its stakeholders. Stakeholders include employees, shareholders, suppliers and any other creditors
of the business.
Sub-committee
RESPOnSIbILITIES
AudIT cOmmITTEE
• financial Reporting
• External audit
nOmInATI On An d
gOvERnAncE cOm mI TTEE
REm unER ATI On
cOmmITT EE
• board Structure
• chairman and Executive
• Risk management and internal
controls including internal audit
• board Appointments
• board Succession Plans
• whistleblowing fraud and anti-
• Senior Executive Appointments
bribery
director Pay
• Senior Executive Pay
• Share Incentive Plans
Read more on page 46
Read more on page 47
Read more on page 48
bOARd cOmPOSITIOn
bO ARd TEn uRE
EXECUTIVE
33.3%
NON-EXECUTIVE
66.6%
gEndER dIvERSITy
MALE
83.3%
FEMALE
16.6%
0–3 YEARS
33.3%
3–6 YEARS
33.3%
ABOVE 6 YEARS
33.3%
Read the directors’ biographies
on pages 36 and 37
45
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information Corporate gOvE RnAncE STATEmEnT
cOnT In uEd
STATEmEnT AbOuT APPL
ThE PRIncIPLES Of ThE cOdE
yIng
The company has applied the
principles of the uk corporate
governance code as reported above.
further explanation of how the code
has been applied in connection with
directors’ remuneration is set out in the
Remuneration Report.
AudIT cOmmITTEE
The Audit committee consists of
independent non-Executive directors.
The chairman is keith down who
succeeded Alan white in february
2015 and the other members are
claire Tiney and Andy king. The
qualifications of the Audit committee
members are detailed on page
36. Its chairman has particularly
relevant experience, being a qualified
chartered accountant and who is
currently serving as the chief financial
Officer of a listed company.
The Audit committee considers the
nature and scope of the audit process
(both internal and external) and its
effectiveness. It also monitors, reviews
and approves the internal audit
programme, meets with the external
auditor and considers the Annual
and Interim financial Statements
before submission to the board. The
committee reviews and monitors the
external auditor’s independence and
objectivity and the effectiveness of the
audit process.
In addition the committee is
responsible for ensuring that the
arrangements are in place to enable
staff, in confidence, to raise any
concerns about possible improprieties
in matters of financial reporting or
other matters. no issues have been
identified during the period.
The committee is responsible for the
review of the company’s key strategic
risks which include those to its business
model future performance, solvency
and liquidity and this process is
performed by the committee chairman
in conjunction with a number of senior
operational managers. It also reviews
the group’s system of internal control
and reports its findings twice a year
to the board. The committee meets
with the external auditor and other
members of the board attend at the
invitation of the Audit committee
chairman.
The Audit committee provide
advice to the board on whether the
annual report is fair, balanced and
understandable and provides the
necessary information shareholders
require to assess the company’s
performance, business model and
strategy. In doing so the following
issues have been addressed
specifically:
• REvIEw Of kEy STRATEgIc
RISkS – the committee conducts
an annual review of key strategic
risks and invites a cross section of
company management in order
to ensure that the review includes
a detailed understanding of the
business. The review highlights the
key risks based on a combination
of likelihood and impact and then
also considers what appropriate
mitigants should be implemented
(highlights from this work are
included in the Strategic Review)
• REvIEw Of POOR PERfORmIng
STORES – as part of both the
interim and full year end review
process poor performing stores
are considered and any related
impairments and/or property
provisions are provided for.
management will then follow up
with detailed action plans to either
improve store performance or seek
an exit solution. dilapidations are
provided for across the entire store
portfolio. The Audit committee
also review progress towards these
plans at the following review.
• REvIEw Of InvEnTOR y –
ensuring that inventory is correctly
valued is a key area of focus for
the Audit committee. The finance
function performs ongoing detailed
checks of supplier invoices by
comparing to system prices and
management conduct a regular
review of any products being
sold, or likely to be sold, below
the original cost price. Inventory
provisions are prepared in
accordance with these reviews.
• SuPPLIER REbATES – the business
has a number of agreements in
place which generate additional
income subject to pre-agreed
purchase thresholds being
triggered. The key risk is inaccurate
or optimistic estimates of volume
that lead to inappropriate income
recognition. These are reviewed to
ensure that any estimates of future
income are robust.
• REvEnuE REcOgnITIOn – like-
for-like (“LfL”) sales growth is one
of our key kPI’s and linked to this
is the risk that our reported revenue
could be misstated due to a failure
in compliance with our company
procedures. The key risk would be
customer orders which have not
yet been fulfilled being included as
sales. This risk is routinely checked
as part of our internal store auditing
programme.
• gOIng cOncERn & LOng
TERm vIAbILITy STATEmEnT – the
chief financial Officer provides an
assessment of the company’s ability
to continue to trade on both a 12
month look forward test basis and
also a longer term review – over
3 years. The conclusion of those
reviews is included in the Strategic
Review section of this report.
46
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www.toppstiles.co.uk Stock code: TPTgovernance • buSInESS SImPLIfIcATIOn
InITIATIvE – during the period
the board decided to pursue two
business simplification initiatives.
They were the centralisation of
support functions on to one site
at Leicester and the closure of the
remaining Topps clearance stores.
The committee have reviewed
the financial provision relating to
these initiatives and have satisfied
themselves that appropriate
provision has been made
Part of the role of the Audit committee
is to review the independence of the
company’s auditor. The company’s
external auditor, deloitte LLP
(“deloitte”), also provides non-audit
services to the company in the form
of tax compliance and remuneration
advice. The Audit committee is
satisfied that deloitte LLP has adequate
policies and safeguards in place to
ensure that auditor objectivity and
independence is maintained. The Audit
committee is aware that providing
audit and non-audit advice could lead
to a potential conflict of interest. The
level of fees paid to deloitte LLP for
non-audit services has been considered
by the Audit committee and is not
perceived to be in conflict with auditor
independence. In order to ensure
the continued independence and
objectivity of the external auditor, there
is an established policy regarding the
provision of non-audit services which
is that all non-audit services are put out
to tender and the contract awarded
based on quality. The Audit committee
has concluded that the auditor,
deloitte, is independent.
deloitte has been auditor for the group
since September 2003. The audit
partner’s first period of signing was the
financial period ended 27 September
2014. consideration is also given, by
the committee, to the work of deloitte
and their independence in deciding
whether an audit tender is required.
currently it is satisfied by the work of
deloitte and their independence, and
has consequently proposed their
re-appointment. The committee has
also considered the requirements of
the Eu Audit Regulations and has
concluded that the company is not
required to rotate and tender for Audit
Services until 2023.
nOmInAT IOn An d
gOvERnAncE cOm mITTE E
The nomination and governance
committee is chaired by Andy king.
The composition of the committee
has changed during the year with
the departure of Alan white and the
appointment of darren Shapland and
keith down as new non-Executive
directors. The committee members
are darren Shapland, keith down
and claire Tiney. The formal terms of
reference for this committee require
it to make recommendations to the
board for appointments of directors
and other senior executive staff.
The nomination and governance
committee is also responsible for
diversity and our policy is included in the
Strategic Review section of this report.
during the year the nomination and
governance committee, in conjunction
with a professional recruitment firm
engaged in the recruitment and
subsequent appointment of keith down
as non-executive director and chair
of the Audit committee and darren
Shapland as non-executive chairman.
dIALOguE wITh InST ITuTI OnA L
ShAREhO LdE RS
The directors seek to build on a mutual
understanding of objectives between
the company and its institutional
shareholders by making annual
presentations and communicating
regularly throughout the year. following
my appointment to the board I also
wrote to major shareholders indicating
my availability to meet with them on
an individual basis to discuss matters
relating to the company.
Read more online at
www.toppstiles.co.uk
m AInTEnAn cE Of A S Oun d
SySTEm Of InTERnAL
cOnT RO L
The board has established a continuous
process for identifying, evaluating
and managing the significant risks the
group faces and regularly reviews the
process. The board is responsible for
the group’s system of internal control
and for reviewing its effectiveness.
Such a system is designed to manage
rather than eliminate the risk of failure
to achieve business objectives and
can only provide reasonable and not
absolute assurance against material
misstatement or loss.
As previously stated the company
is committed to complying with
corporate governance guidelines
and currently complies with the 2012
uk corporate governance code The
Audit committee assists the board in
discharging its responsibilities in this
regard. The outcomes from the recent
key risks and uncertainties review are
detailed in the Strategic Review section
of this report and the board has also
considered all significant aspects of
internal control in conjunction with the
review of the work of Internal Audit.
during the course of its review of the
system of internal control, the board
has not identified nor been advised
of any failings or weaknesses which
it has determined to be significant.
Therefore a confirmation in respect
of necessary actions has not been
considered necessary.
Darren Shapland
chairman of the board
1 december 2015
47
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information
Remuneration REPORT
S t a t e m e n t f r o m t h e ch a i r m a n o f t h e R e m u n e r a t i o n co m m i t t e e
ThE cOmmITTEE hAS
cOnTInuEd TO mOnITOR
ExEcuTIvE REmunERATIOn
POLIcy TO TAkE AccOunT
Of EvOL vIng mARkET
PRAcTIcE whILST ALSO
SEEkIng TO EnSuRE ThAT
A STAbLE fRAmEwORk IS
mAInTAInEd
Claire Tiney
chAIRmAn Of ThE REmunERATIOn cOmmITTEE
Dear shareholder
...
I am pleased to present the directors’ report on remuneration.
achieving all four of the individual targets specifically
focussed upon delivery of the strategic plan carried a
maximum of 5% of salary for each target and a further 63%
for delivery above the PbT target for the year.
This report is presented in two sections: the Annual Report
on Remuneration and the directors’ Remuneration Policy.
The Annual Report on Remuneration provides details of the
amounts earned in respect of the 53 week period ended
3 October 2015 and how the directors’ Remuneration
Policy will be operated for the 52 week period
commencing 4 October 2015. This is subject to an
advisory vote at the 2016 Annual general meeting. The
directors’ Remuneration Policy sets out the forward-looking
remuneration policy. It was the subject of a binding vote at
the 2015 Annual general meeting.
REvI Ew Of ThE 2014/15 fInAn cI A L yE AR
The Remuneration committee remains committed to a
responsible approach to executive pay. As described
in the financial Review section of this Annual Report,
the company has delivered an 8.7% increase in overall
revenues which has generated a 19.3% increase in
adjusted pre-tax profits to £20.4 million. In addition the
board are recommending a final dividend to shareholders
of 2.25 pence per share which will bring the dividend for
the year to 3.00 pence per share, an increase of 33% on
the prior period.
consequently, the Executive directors will receive 83%
bonus (2014:74% preceding approval of the current
Remuneration Policy). The maximum annual bonus potential
was up to 100% of salary. This has been reached by
further details regarding the annual bonus earned in
respect of the 53 week period ending 3 October 2015
are included on pages 59 and 60.
during the period the following changes to base salary and
benefits were made with effect from 1 june 2015:
• The base salary increase for matt williams was 2% which
was within the range of salary increases across the group.
• As outlined in last years’ report The committee resolved
to increase the base salary for Rob Parker by 5%. These
increases reflects the growth of the company, prevailing
market conditions and internal base salary relativities
O uTL O Ok fOR ThE 20 1 5/ 16 fInAn cI AL yE AR
The committee has continued to monitor executive
remuneration policy to take account of evolving market
practice whilst also seeking to ensure that a stable
framework is maintained to avoid making unnecessary and
frequent changes to the structure of pay. Accordingly, the
existing remuneration policy and fundamental structure of
the package remains largely unchanged.
Claire Tiney
chairman of the Remuneration committee
1 december 2015
48
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www.toppstiles.co.uk Stock code: TPTgovernance dIREcTORS’ REmunERATIOn PO LIcy
This part of the report sets out the company’s directors’ Remuneration Policy, which, was subject to a binding shareholder
vote at the 2015 Annual general meeting and remains in force for a 3 year period from that date.
ExEcUTivE diREcToRS
PURPoSE And
comPonEnT
LinK To STRATEGy oPERATion
mAximUm
oPPoRTUniTy
PERfoRmAncE
mEASURES
bASE SALAR y core element of
Salaries are usually reviewed
while there is no maximum salar y,
not applicable.
fixed remuneration
annually taking into account:
increases will normally be in line
set at a market
competitive level
with the aim to
• underlying group performance;
with the typical level of salar y
increase awarded (in percentage of
• role, experience and individual
salar y terms) to other employees in
attract and retain
performance;
the group.
Executive directors
of the calibre
required.
• competitive salary levels and
Salar y increases above this
market forces; and
level may be awarded in certain
• pay and conditions elsewhere
in the group.
circumstances, such as, but not
limited to:
• where an Executive director has
been promoted or has had a
change in scope or responsibility;
• an individual’s development or
performance in role (e.g. to align
a newly appointed Executive
director’s salary with the market
over time);
• where there has been a change in
market practice; or
• where there has been a change in
the size and/or complexity of the
business
Such increases may be implemented
over such time period as the
committee deems appropriate.
bEnEfiTS
fixed element of
Executive directors receive
whilst the committee has not set
not applicable.
remuneration set at
benefits in line with market
an absolute maximum on the level
a market competitive
practice, and these include
of benefits Executive directors may
level with the aim to
principally life insurance,
receive, the value of benefits is
attract and
income protection, private
set at a level which the committee
retain Executive
medical insurance, company
considers to be appropriately
directors of the
car or car allowance and fuel
positioned taking into account
calibre required.
allowance and, where relevant,
relevant market levels based on the
relocation expenses.
nature and location of the role and
individual circumstances.
Other benefits may be
provided based on individual
circumstances. These may
include, for example, travel
expenses.
49
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cOnT In uEd
ExEcUTivE diREcToRS
PURPoSE And
comPonEnT
LinK To STRATEGy oPERATion
mAximUm
oPPoRTUniTy
PERfoRmAncE
mEASURES
PEnSionS
Provides market
Executive directors are eligible
Set at a level which the committee
not applicable.
competitive
to participate in the defined
considers to be appropriately
post-employment
contribution pension scheme.
positioned taking into account relevant
benefits (or cash
In appropriate circumstances,
market levels based on the nature and
equivalent) with the
such as where contributions
location of the role and individual
aim to attract and
exceed the annual or lifetime
circumstances.
retain Executive
allowance, Executive directors
directors of the
may be permitted to take a cash
calibre required.
supplement instead of contributions
The contribution levels for the year
2014/15 were set at 12.5% of salary.
to a pension plan.
contributions of up to 20% of salary
may be made to take account of
a change in the scope of the role,
increase in responsibility and/or a
change in the size and/or complexity
of the business.
ALL EmPLoyEE
To create alignment
Executive directors are entitled
Participation limits are those set by
not subject to performance
ShARE
with the group and
to participate in a tax qualifying
the uk tax authorities from time to
measures in line with hmRc
SchEmES
promote a sense of
all employee SAyE under which
time.
practice.
ownership.
they may make monthly savings
contributions over a period of three
or five years linked to the grant
of an option over the company’s
shares with an option price which
can be at a discount of up to
20% to the market value of shares
at grant.
Executive directors are also
entitled to participate in an
hmRc tax-qualifying Share
Incentive Plan (“SIP”).
50
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www.toppstiles.co.uk Stock code: TPTgovernance ExEcUTivE diREcToRS
PURPoSE And
comPonEnT
LinK To STRATEGy oPERATion
mAximUm
oPPoRTUniTy
PERfoRmAncE
mEASURES
AnnUAL
Rewards
Awards are based on annual
The maximum bonus opportunity
Targets are set annually reflecting
bonUS
performance against
performance against key financial
for an Executive director will not
the company’s strategy and are
annual targets
targets and/or the delivery of
exceed 100% of salar y.
aligned with key performance
which support the
personal/strategic objectives.
indicators.
strategic direction of
the group.
Pay-out levels are determined by
the committee after the year end
based on performance against
those targets.
The committee has discretion to
amend the pay-out should any
formulaic output not reflect the
committee’s assessment of overall
business performance.
for up to two years following
the payment of an annual bonus
award, the committee may require
the repayment of some or all of
the award if an act or omission or
a failure to apply reasonable skill
and judgement leads to a material
loss to the group or serious
reputational damage to the group
or a material misstatement of the
group’s financial statements.
up to 20% of the bonus will be
based on non-financial strategic
measures and/or individual
performance and the balance
will be assessed against key
financial performance metrics of
the business.
F inanc ial m e t ri cs
There is no minimum payment
at threshold performance and
all of the maximum potential
will be paid out for maximum
performance, with scaled vesting
in between.
N on- financi al or
indi v idu al m et ri cs
vesting of the non-financial or
individual strategic awards will
apply based on the committee’s
assessment of the extent to which
a non-financial or individual
strategic metric has been met.
51
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cOnT In uEd
ExEcUTivE diREcToRS
PURPoSE And
comPonEnT
LinK To STRATEGy oPERATion
mAximUm
oPPoRTUniTy
PERfoRmAncE
mEASURES
LonG TERm
To incentivise
Long-term incentive awards are
The normal maximum award is
Relevant performance measures
incEnTivE
Executive
granted under the LTIP,
100% of salar y in respect of a
are set that reflect underlying
PLAn (“LTiP”)
directors, and to
approved by shareholders on
financial year. under the share
business performance.
deliver genuine
23 january 2013.
plan rules the overall maximum
performance-related
pay, with a clear
line of sight for
Executives and
under the LTIP, awards of nil cost
share options or conditional shares
may be made.
opportunity that may be granted in
respect of a financial year is 200%
of salar y. The normal maximum
award limit will only be exceeded
direct alignment
Awards may be settled in cash at
in exceptional circumstances
Performance measures and
their weighting where there is
more than one measure are
reviewed annually to maintain
appropriateness and relevance.
with shareholders’
the election of the committee.
involving the recruitment or
for achievement of threshold
interests.
The vesting of awards will be
retention of an Executive director.
performance 25% of the
maximum opportunity will vest.
subject to the achievement
The market value of the shares
of specified performance
subject to an award is based on
There will usually be straight line
conditions, over a period of at
the three day average share price
vesting between threshold and
least three years.
immediately prior to the company’s
maximum performance.
year end, unless the committee
determines other wise.
The committee may make a
dividend equivalent payment
(‘dividend Equivalent’) to reflect
dividends that would have been
paid over the period to vesting on
shares that vest. This payment may
be in the form of additional shares
or a cash payment equal to the
value of those additional shares.
The committee has the right
to reduce, cancel or impose
further conditions on unvested or
unexercised awards if there has
been a material misstatement of
the company’s financial results, a
material failure of risk management
by the company or if there has
been serious reputational damage
to the company as a result
of the participant’s misconduct
or otherwise.
for up to two years following the
payment of a long-term incentive
award, the committee may require
the repayment of some or all of
the award if an act or omission or
a failure to apply reasonable skill
and judgement leads to a material
loss to the group or serious
reputational damage to the group
or a material misstatement of the
group’s financial statements.
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www.toppstiles.co.uk Stock code: TPTgovernance non-ExEcUTivE diREcToRS
PURPoSE And LinK To STRATEGy
APPRoAch of ThE comPAny
Sole element of non-Executive
fees are normally reviewed annually.
director remuneration, set at
a level that reflects market
conditions and is sufficient
to attract individuals with
appropriate knowledge and
experience.
fees paid to non-Executive directors for their ser vices are approved by the board. fees may include a
basic fee and additional fees for further responsibilities (for example, chairmanship of board committees
or holding the office of senior independent director). fees are based on the level of fees paid to non-
Executive directors ser ving on the board of similar-sized uk listed companies and the time commitment
and contribution expected for the role. Typically, any fee increase will be in line with the wider
workforce. fee increases may be awarded above this level in certain circumstances such as (but not
limited to):
• where there has been a change in market practice;
• where there has been a change in the size and complexity of the company; or
• where there has been an increase in the non-Executive director’s time commitment to the role.
Overall fees paid to non-Executive directors will remain within the limits set by the company’s Articles
of Association.
non-Executive directors cannot participate in any of the company’s share options schemes and are
not eligible to join the company’s pension scheme. non-Executive directors may be eligible to receive
benefits such as the use of secretarial support, travel costs or other benefits that may be appropriate.
ExPLAnATIOn Of
P ERfORmAncE mEASuRES
c hOSEn
Performance measures are selected
that are aligned with the performance
of the group and the interests of
shareholders. Stretching performance
targets are set each year for the annual
bonus and long term incentive awards.
when setting these performance
targets, the committee will take into
account a number of different reference
points, which may include the
company’s business plans and strategy
and the economic environment. full
vesting will only occur for what the
committee considers to be a stretching
performance.
The annual bonus can be assessed
against financial and individual/
strategic measures determined by
the committee. The committee
considers that profit before tax is a
key performance metric for the annual
bonus and specific strategic objectives
for each director which are aligned to
delivering the overall business strategy
encourages behaviours which facilitate
profitable growth and the future
development of the business.
Long-term performance measures are
chosen by the committee to provide
a robust and transparent basis on
which to measure the company’s
performance over the longer term
and to provide alignment with the
business strategy. They are selected
to be aligned with the interests of
shareholders and to drive business
performance whilst not encouraging
excessive risk taking.
The committee retains the ability to
adjust or set different performance
measures if events occur (such as
a change in strategy, a material
acquisition and/or a divestment of
a group business or a change in
prevailing market conditions) which
cause the committee to determine that
the measures are no longer appropriate
and that amendment is required so that
they achieve their original purpose.
Awards and options may be adjusted
in the event of a variation of share
capital in accordance with the rules of
the LTIP.
PO L Icy fO R ThE
REmu nE RATIOn Of EmP LOyE ES
mO R E gEnE RAL L y
Remuneration arrangements are
determined throughout the group
based on the same principle that
reward should be achieved for
delivery of the business strategy and
should be sufficient to attract, retain
and motivate high-calibre employees.
IL LuST RATI OnS Of AP P LIcATI On
Of REm u nER ATIOn PO L Icy
Illustrations were provided for in the
2013/2014 Annual Report.
Read more online at
www.toppstiles.co.uk
AP PR OAc h TO R EcRuI TmEnT
REmu nE RATI On
The policy aims to facilitate the
appointment of individuals of sufficient
calibre to lead the business and
execute the strategy effectively for
the benefit of shareholders. when
appointing a new Executive director,
the committee seeks to ensure that
arrangements are in the best interests
of the company and not to pay more
than is appropriate.
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Remuneration REPORT
cOnT In uEd
to provide a bonus or long-term
incentive award for that year
as there would not be sufficient
time to assess performance.
Subject to the limit on variable
remuneration set out below, the
quantum in respect of the months
employed during the year may
be transferred to the subsequent
year so that reward is provided
on a fair and appropriate basis;
— if the Executive director will be
required to relocate in order
to take up the position, it is
the company’s policy to allow
reasonable relocation, travel
and subsistence payments. Any
such payments will be at the
discretion of the committee.
• The committee may also alter the
performance measures, performance
period and vesting period of the
annual bonus or LTIP, subject to the
rules of the LTIP, if the committee
determines that the circumstances of
the recruitment merit such alteration.
The rationale will be clearly
explained in the following directors’
Remuneration Report.
• The maximum level of variable
remuneration which may be granted
(excluding “buyout” awards as
referred to below) is 300% of salary.
Any share awards referred to in
this section will be granted as far
as possible under the company’s
existing share plans. If necessary, and
subject to the limits referred to above,
recruitment awards may be granted
outside of these plans as permitted
under the Listing Rules which allow for
the grant of awards to facilitate, in
unusual circumstances, the recruitment
of an Executive director.
The committee may make payments
or awards in respect of hiring an
employee to “buyout” remuneration
arrangements forfeited on leaving a
previous employer. In doing so the
committee will take account of relevant
factors including any performance
conditions attached to the forfeited
arrangements and the time over which
they would have vested. The committee
will generally seek to structure buyout
awards or payments on a like for like
basis to the remuneration arrangements
forfeited. Any such payments or awards
are limited to the expected value of the
forfeited awards. where considered
appropriate, such special recruitment
awards will be liable to forfeiture or
“malus” and/or “clawback” on early
departure.
where a position is filled internally,
any ongoing remuneration obligations
or outstanding variable pay elements
shall be allowed to continue
according to the original terms.
fees payable to a newly-appointed
chairman or non-Executive director
will be in line with the fee policy in
place at the time of appointment.
SERvIcE cOnTR AcT S
It is the company’s policy that
Executive directors are offered
permanent contracts of employment
with a twelve month notice period.
under an event of contract termination
any severance payment would be
subject to negotiation but would be
with regard to length of service and
prevailing notice period.
company policy also states that
non-Executive directors should have
contracts of services with an indefinite
term providing for a maximum
of six months’ notice. The role of
chairman is also non-Executive, with
an indefinite term contract and a
maximum six months’ notice.
The committee will take into
consideration a number of relevant
factors, which may include the calibre
of the individual, the candidate’s
existing remuneration package, and the
specific circumstances of the individual
including the jurisdiction from which the
candidate was recruited.
when hiring a new Executive director,
the committee will typically align
the remuneration package with the
above Policy. The committee may
include other elements of pay which it
considers are appropriate, however,
this discretion is capped and is subject
to the principles and the limits referred
to below.
• base salary will be set at a level
appropriate to the role and the
experience of the Executive director
being appointed. This may include
agreement on future increases up to
a market rate, in line with increased
experience and/or responsibilities,
subject to good performance,
where it is considered appropriate.
• Pension and benefits will be
provided in line with the above
Policy.
• The committee will not offer non-
performance related incentive
payments (for example a
“guaranteed sign-on bonus”).
• Others elements may be included in
the following circumstances:
— an interim appointment being
made to fill an Executive director
role on a short-term basis;
— if exceptional circumstances
require that the chairman or a
non-Executive director takes on
an executive function on a short-
term basis;
— if an Executive director is
recruited at a time in the year
when it would be inappropriate
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www.toppstiles.co.uk Stock code: TPTgovernance PAymEnTS fOR LOSS Of OffIcE
The principles on which the determination of payments for loss of office will be approached are set out below:
PAymEnT in LiEU of noTicE
The company has discretion to make a payment in lieu of notice. Such a payment
PoLicy
would be calculated by reference to basic salar y and shall include compensation for
any employer pension contributions for the unexpired period of notice. The payment
may also include compensation for benefits for the period.
AnnUAL bonUS
This will be at the discretion of the committee on an individual basis and the
decision as to whether or not to award a bonus in full or in part will be dependent
on a number of factors, including the circumstances of the individual’s departure and
their contribution to the business during the bonus period in question. Any bonus
amounts paid will typically be pro-rated for time in ser vice during the bonus period
and will, subject to performance, be paid at the usual time (although the committee
retains discretion to pay the bonus earlier in appropriate circumstances).
LTiP
The extent to which any unvested award will vest will be determined in accordance
with the rules of the LTIP.
unvested awards will normally lapse on cessation of employment. however, if the
participant leaves due to death, illness, injur y, disability, sale of his employer or
any other reason at the discretion of the committee, the committee shall determine
whether the award will vest at cessation or at the normal vesting date. In either
case, the extent of vesting will be determined by the committee taking into account
the extent to which the performance condition is satisfied and, unless the committee
determines other wise, the period of time elapsed from the date of grant to the date
of cessation relative to the performance period. Awards may then be exercised
during such period as the committee determines.
Awards which have already vested at the date of cessation may be exercised for
such period as the committee determines.
chAnGE of conTRoL
The extent to which unvested awards will vest will be determined in accordance with
the rules of the LTIP.
Awards under the LTIP will vest early on a takeover, merger or other relevant
corporate event. The committee will determine the level of vesting taking into
account the extent to which the performance condition is satisfied and, unless the
committee determines other wise, the period of time elapsed from the date of grant
to the date of the relevant corporate event relative to the performance period. The
committee has discretion under the rules of the LTIP to vest awards on a different
basis.
miTiGATion
The committee’s practice is that if an Executive director’s employment is terminated
any compensation payment will be calculated in accordance with normal legal
principles including the application of mitigation to the extent appropriate to the
circumstances of the termination.
ALL EmPLoyEE ShARE PLAnS
Payments may be made either in the event of a loss of office or a change of control
under the all employee share plans, which are governed by the rules and the
legislation relating to such tax qualifying plans. There is no discretionar y treatment
for leavers or on a change of control under these schemes.
In appropriate circumstances, payments may also be made in respect of accrued
holiday, outplacement and legal fees.
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cOnT In uEd
where a buyout award is made
under the Listing Rules then the leaver
provisions would be determined at the
time of the award.
The committee reserves the right to
make additional exit payments where
such payments are made in good
faith in discharge of an existing legal
obligation (or by way of damages for
breach of such an obligation) or by
way of settlement or compromise of
any claim arising in connection with
the termination of a director’s office or
employment.
where the committee retains
discretion it will be used to provide
flexibility in certain situations,
taking into account the particular
circumstances of the director’s
departure and performance.
There is no entitlement to any
compensation in the event of a non-
Executive directors’ appointment being
terminated.
ExISTIng cOnTRAcTuAL
ARRAngEmEnTS
The committee retains discretion to
make any remuneration payment or
payment for loss of office outside the
policy in this report:
• where the terms of the payment
were agreed before the policy
came into effect;
• where the terms of the payment
were agreed at a time when the
relevant individual was not a
director of the company and, in
the opinion of the committee, the
payment was not in consideration
of the individual becoming a
director of the company; and
• to satisfy contractual commitments
under legacy remuneration
arrangements.
for these purposes, “payments”
includes the satisfaction of awards of
variable remuneration and, in relation
to an award over shares, the terms of
the payment are agreed at the time the
award is granted.
STATEmEnT Of
cOnSIdER AT IOn Of
EmPLOymEnT cOn dI TI OnS
ELSEwhE RE In ThE cOmPAn y
when determining the remuneration
arrangements for Executive
directors, the committee takes into
consideration, as a matter of course,
the pay and conditions of employees
throughout the group. In particular, the
committee is kept informed on:
• salary increase for the general
employee population;
• overall spend on annual bonus; and
• participation levels in the annual
bonus and share plans.
Although no consultation with
employees takes place in relation to
determining the remuneration policy for
directors, the group has various ways
of engaging employees collectively, as
teams and one to one which provide
a forum for employees to express their
views on the company’s executive and
wider employee reward policies.
STATEmEnT Of
cOnS IdER ATIOn Of
ShA REhO LdE R vIEwS
The committee is committed to an
ongoing dialogue with shareholders
and welcomes feedback on directors’
remuneration. Prior to the new LTIP
being formally put to shareholders in
2013, the committee engaged with
major shareholders and institutional
bodies setting out the proposals and
rationale for the changes on variable
pay arrangements for Executive
directors. major shareholders were
also advised of the rationale for
the increase in the annual bonus
opportunity for 2014/15.
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AnnuAL REPORT On REmunERATI On
Single fig ure table
The tables below detail the total remuneration receivable by each director for the 52 week period ended 27 September
2014 and the 53 week period ended 3 October 2015.
2014/15
ExEcUTivE diREcToRS
m T m wILLIAmS
R PARkER
non-ExEcUTivE diREcToRS
j m jAck 1
A whITE 2
c TInEy
A kIng
d ShAPLAnd 3
k dOwn 4
SALARy And
fEES
£’000
bEnEfiTS
£’000
389
243
104
8
43
42
62
28
32
29
–
–
–
–
–
–
AnnUAL
bonUS
£’000
318
198
–
–
–
–
–
–
LTiP
£’000
PEnSion
£’000
ToTAL
REmUnERATion
£’000
–
–
–
–
–
–
–
–
48
30
–
–
–
–
–
–
787
500
104
8
43
42
62
28
1
j m jack retired from his role as non-Executive chairman on the 18 march 2015 and was replaced by darren Shapland. The board asked j m jack to
remain as an advisor to the board until the 14/15 Agm and has been recompensed by continuing to receive a fee during this period
2 Resigned 8 december 2014
3 Appointed 19 march 2015
4 Appointed 2 february 2015
2013/14
ExEcUTivE diREcToRS
m T m wILLIAmS
R PARkER
non-ExEcUTivE
j m jAck
A whITE
c TInEy
A kIng
SALARy And
fEES
£’000
bEnEfiTS
£’000
AnnUAL
bonUS
£’000
LTiP
£’000
PEnSion
£’000
ToTAL
REmUnERATion
£’000
375
227
102
42
41
41
34
30
–
–
–
–
278
168
–
–
–
–
122
71
–
–
–
–
41
25
–
–
–
–
849
521
102
42
41
41
The figures in the single figure tables above are derived from the following:
SALARy And fEES
ThE AmoUnT of SALARy/fEES REcEivEd in ThE PERiod
bEnEfiTS
PEnSion
AnnUAL bonUS
LTiP
The taxable value of benefits received in the period. These are principally life insurance, income
protection, private medical insurance, company car or car allowance, fuel allowance and the value of
SAyE scheme options granted during the period. The value attributable to sharesave scheme options
is calculated on the following basis: monthly contribution x 12 x 20% (being the discount applied to
market value in determining the exercise price).
The pension figure represents the cash value of company pension contributions paid to the Executive
directors as part of the company’s defined contribution scheme.
The annual bonus is the cash value of the bonus earned in respect of the period. A description of
performance against the objectives which applied for the period is provided on pages 59 and 60.
The LTIP figure stated for the period 2013/14 represents the value of matching awards granted under
the Topps Tiles Plc 2010 deferred bonus Long Term Incentive Plan that vested in respect of the period.
for the matching share awards granted on 28 november 2012 EbITdA earnings growth over the two
year performance period to 27 September 2014 has been 12.9% therefore the matching share awards
vested in full in november 2014. The estimated face value of the vested shares is based on a share
price of 108 pence being the average market value of the company’s shares for the last quarter of the
52 week period ended 27 September 2014.
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cOnT In uEd
IndIvIduAL ELEmEnTS Of REmunE RATI On
Base salar y and fees
base salaries for individual directors are reviewed annually by the committee and are set with reference to the
Remuneration Policy. during the period the following changes to base salary were made with effect from 1 june 2015:
m T m wILLIAmS
R PARkER
bASE SALARy
1 jUnE
2014
bASE SALARy
1 jUnE
2015
£380,708
£388,323
£235,143
£246,901
% incREASE
2%
5%
The base salary increase for matt williams was in line with the range of salary increases across the group. The base
salary increase for Rob Parker reflects the growth of the company, prevailing market conditions and internal base salary
relativities and in line with the statement made in the 2013/2014 Annual Report.
The non-Executive directors’ fees were increased with effect from 1 june 2015 in line with the increase for the wider
workforce:
bASIc fEE
AddITIOnAL fEES
SEnIOR IndEPEndEnT dIREcTOR/chAIR Of REmunERATIOn cOmmITTEE
chAIR Of ThE nOmInATIOnS cOmmITTEE
chAIR Of ThE AudIT cOmmITTEE
TOTAL PEnSIOn EnTITLEmEnTS
fEES 1 jUnE
2014
fEES 1 jUnE
2015
% incREASE
£36,516
37,246
£6,120
£5,100
£5,100
6,242
5,202
5,202
2%
2%
2%
2%
during the year the company pension benefit represented 12.5% of salary for the Executive directors and is in line with
the Remuneration Policy.
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for the 53 week period ended 3 October 2015, the maximum annual bonus opportunity was 100% of salary.
To encourage behaviours which facilitate profitable growth and future development of business up to 80% of salary could
be earned for delivering PbT above the adjusted PbT target and up to 20% of salary could be earned for the achievement
of individual objectives specifically delivering the strategic plan.
The following table sets out the bonus pay-out to the Executive directors for 2014/15 and how this reflects performance
for the period.
AdjUSTEd PbT 1
£20 million
£20.4 million
TARGET
AcTUAL PERfoRmAncE
STRATEGic
objEcTivES
met in full
met in full
met in full
met in full
The strategic targets for the period
related to:
• Increase market share
• Average Transaction value (“ATv”)
• discounting
• customer Service
The committee considers that
the detailed strategic targets are
commercially sensitive and should
therefore remain confidential to
the company. They provide our
competitors with insight into our
business plans, expectations and
our strategic actions.
ToTAL bonUS
EARnEd
1 Adjusted PbT as defined in the financial review section of this report.
AnnuAL bOnuS fOR 2015/16
ExEcUTivE diREcToR bonUS EARnEd
AS A PERcEnTAGE of SALARy
63%
20%
5%
5%
5%
5%
83%
The maximum annual bonus opportunity for 2015/16 financial year is 100% of salary. up to 20% of salary will continue
to be focused upon achievement of individual objectives specifically delivering the strategic plan. The element of the
annual bonus that can be earned for delivering PbT above the adjusted PbT target for the year is 80% of salary.
The committee considers that the actual annual bonus targets are commercially sensitive and should therefore remain
confidential to the company. however, the Remuneration committee will continue to disclose how the bonus pay-out
delivered relates to performance against the targets on a retrospective basis.
59
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cOnT In uEd
LOng TERm IncEnTIvES
Awar ds vesting in respect o f the fi na nc i al y e ar
no LTIP award vested during the financial year
AwARdS gRAnTEd d uRIng ThE fInAn cI AL yE AR
The LTIP was approved by shareholders on 23 january 2013. for the 53 week period ended 3 October 2015 the
following awards were granted to Executive directors on 12 december 2014.
TyPE of
AWARd
PERcEnTAGE
of SALARy
nUmbER of
ShARES
fAcE vALUE
AT GRAnT1
% of AWARd
vESTinG AT
ThREShoLd
PERfoRmAncE
PERiod
m T m wILLIAmS
R PARkER
nil-cost option
nil-cost option
100%
100%
359,159
£380,709
221,833
£235,142
25%
25%
3 years
3 years
1 valued using a share price of 106.00 pence based on the average three day share price ending on 27 September 2014.
The awards will vest based on the following cumulative Adjusted EPS targets:
cUmULATivE AdjUSTEd EPS foR ThE PERiod 2014/15 To 2016/17
PERcEnTAGE of ThE AWARd ThAT WiLL vEST
23.02 pence
25%
greater than 23.02 pence but less than 24.83 pence
determined on a straight line basis between 25% and 100%
24.83 pence
100%
Adjusted EPS is defined as stated in the company’s accounts for the relevant financial period excluding exceptional items
and subject to such adjustments as the board in its discretion determines are fair and reasonable.
These targets equate to adjusted EPS growth of c.7% growth from the 2014/15 outturn for 25% vesting and c.11% for
100% vesting.
notwithstanding the cumulative Adjusted EPS targets calculated above, the extent to which the awards will vest will
be subject to the committee’s assessment of the quality of earnings over the performance period. The committee may
reduce the extent to which the award would otherwise vest if the committee determines that the cumulative Adjusted EPS
achieved is not consistent with the achievement of commensurate underlying financial performance taking into account
such factors as the committee considers appropriate, including market share, margin performance, net debt, overall
returns to shareholders and shareholder value creation.
LOng TERm IncEnTIvES fOR 201 5/1 6
no changes to the quantum or performance conditions are proposed. The maximum LTIP opportunity will remain at 100%
of salary and the proportion of the award vesting for threshold performance remains at 25% of salary.
The awards will vest based on the following cumulative Adjusted EPS targets that equate to adjusted EPS growth of c.7%
growth from the 2015/16 outturn for 25% vesting and c.11% for 100% vesting.
cUmULATivE AdjUSTEd EPS foR ThE PERiod 2015/16 To 2017/18
PERcEnTAGE of ThE AWARd ThAT WiLL vEST
27.29 pence
25%
greater than 27.29 pence but less than 29.42 pence
determined on a straight line basis between 25% and 100%
29.42 pence
100%
Adjusted EPS is defined as stated in the company’s accounts for the relevant financial period excluding exceptional items
and subject to such adjustments as the board in its discretion determines are fair and reasonable.
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ALL EmPLOyEE ShARE PLAnS
The Executive directors may participate in the company’s all employee share plans, the Topps Tiles Plc SAyE Scheme
(SAyE Scheme) and the Topps Tiles Plc Share Incentive Plan (SIP), on the same basis as other employees.
The SAyE Scheme provides an opportunity to save a set monthly amount (currently up to £500) over three years towards
the exercise of a discounted share option, which is granted at the start of the three years.
The SIP provides an opportunity for employees to buy shares from their pre-tax remuneration up to the limit permitted by
the relevant tax legislation (currently £1,800 per year). no matching shares are awarded.
Options and awards under these plans are not subject to performance conditions.
The following SAyE options were granted to the Executive directors during the financial year ended 3 October 2015:
m T m wILLIAmS
R PARkER
TyPE of AWARd1
nUmbER of
ShARES
fAcE vALUE
AT GRAnT2
dIScOunTEd ShARE OPTIOn
dIScOunTEd ShARE OPTIOn
3,913
3,913
£4,745
£4,745
1
2
In accordance with the scheme rules, the options are granted with an exercise price set at a discount of up to 20% to the market value of a share when
the invitations to acquire the option are issued. for the awards granted in 2014/15, the share price at the date of invitation was 115 pence and the
exercise price is 92 pence per share. In accordance with the scheme rules, the exercise of the options is not subject to any performance condition.
The face value of the award is calculated by multiplying the number of shares under option by the market value of a share on the date of grant (being
121.25 pence for these options granted on 28 january 2015).
STATEmEnT Of dI REcTORS’ ShAR EhOLdIng An d ShA RE InTE R E ST S
In order to further align the Executive directors’ long term interests with those of shareholders, the committee introduced
shareholding guidelines in 2013. The guidelines require that, with effect from 2013/14, Executive directors build up
a shareholding of one times salary over a period of five years. The table below sets out the number of shares held or
potentially held by directors (including their connected persons where relevant) as at 3 October 2015.
m T m wILLIAmS
R PARkER
ShAREhoLdinG GUidELinES
cURREnT ShAREhoLdinG (AS % of SALARy)
100% of salary
100% of salary
670%
123%
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cOnT In uEd
The interests of each Executive director of the company as at 3 October 2015 were as follows:
diREcToR
TyPE
oWnEd
ExEcUTivE diREcToRS
m T m wILLIAmS
Shares
1,748,986
LTIP shares
SAyE options
n/a
n/a
R PARkER
Shares
204,208
LTIP shares
SAyE options
non-ExEcUTivE diREcToRS
d ShAPLAnd
k dOwn
c TInEy
A kIng
Shares
Shares
Shares
Shares
n/a
n/a
80,000
n/a
15,480
n/a
ExERciSEd
dURinG ThE
yEAR
UnvESTEd
And
SUbjEcT To
PERfoRmAncE
condiTionS
UnvESTEd
And noT
SUbjEcT To
PERfoRmAncE
condiTionS
vESTEd
ToTAL AS AT
3 ocTobER
2015
n/a
n/a
0
n/a
n/a
0
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
1,565,381
n/a
n/a
945,571
n/a
n/a
1,748,986
1,565,381
15,958
n/a
n/a
n/a
15,958
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
15,958
204,208
945,571
15,958
80,000
n/a
15,480
n/a
note. director’s shareholdings include shares held by their connected persons where relevant.
PAymEnTS mAdE TO fORmER dI REcT OR S d uRIn g ThE P E RI Od
As mention earlier in this report The Right honourable michael jack cbE retired from his role as non- Executive chairman
during the year and was replaced by darren Shapland. The board asked him to remain an advisor up until the 14/15
Agm and has been recompensed by continuing to receive a fee during this period.
PAymEnTS fOR LOSS Of OffIcE mAdE d uR In g ThE P E RI Od
no payments for loss of office were made in the period to any director of the company.
62
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www.toppstiles.co.uk Stock code: TPTgovernance PERfORmAncE gRAPh
The graph below shows the TSR performance for the company’s shares in comparison to the fTSE Small cap Index for the
five years to 3 October 2015. for the purposes of the graph, TSR has been calculated as the percentage change during
the five-year period in the market price of the shares, assuming that dividends are reinvested. The graph shows the value,
by the end of the 2014/15 financial year, of £100 invested in the group over the last five financial years compared
with £100 invested in the fTSE Small cap Index which the directors believe is the most appropriate comparative index.
350.00
300.00
250.00
200.00
150.00
100.00
50.00
0
0
1
0
2
/
0
1
/
1
0
1
1
0
2
/
1
0
/
1
0
1
1
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4
0
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1
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1
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7
0
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2
1
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1
0
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1
0
2
1
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/
4
0
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1
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7
0
/
1
0
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1
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2
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0
1
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3
1
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1
0
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1
0
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0
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1
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7
0
/
1
0
TPT
FTSE 250
hISTORIcAL chIEf ExEcuTIvE REmunE RATI On OuTcOmE S
The table below shows details of the total remuneration and annual bonus and LTIP vesting (as a percentage of the
maximum opportunity) for the chief Executive over the last five financial years.
53 wEEk PERIOd EndEd 3 OcTObER 2015
52 wEEk PERIOd EndEd 27 SEPTEmbER 2014
52 wEEk PERIOd EndEd 28 SEPTEmbER 2013
52 wEEk PERIOd EndEd 29 SEPTEmbER 2012
52 wEEk PERIOd EndEd 1 OcTObER 2011
53 wEEk PERIOd EndEd 2 OcTObER 2010
ToTAL
REmUnERATion
AnnUAL bonUS AS A %
of mAximUm oPPoRTUniTy
LTiP AS A % of
mAximUm oPPoRTUniTy
812
849
564
579
384
515
83%
99%
46.3%
35.2%
0%
40%
n/a
n/a
n/a
n/a
n/a
n/a
note: The board has resolved that the Performance condition attached to the LTIP Award made on the 26 february 2013 relating to the three consecutive
financial periods of the company beginning with the company’s 2012/2013 financial period has been satisfied and will vest during the period ending
1 October 2016.
63
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information Remuneration REPORT
cOnT In uEd
cEO PA y IncREASE In RELATIOn TO ALL EmPL OyE E S
The table below sets out in relation to salary, taxable benefits and annual bonus the percentage change in remuneration
for m T m williams compared to the wider workforce. for these purposes, the wider workforce includes all employees.
PERcEnTAGE chAnGE
SALAR y 1
TAxAbLE bEnEfITS
AnnuAL bOnuS
cEo
1.9%
-5.2%
14.4%
WidER
WoRKfoRcE
3.6%
-1.1%
6.1%
1 m T m williams’ salary was increased by 2% with effect from 1 june 2015. because this table shows the difference between mr williams’ full year
salary for 2013/14 and 2014/15, the percentage increase shown is less than 2%.
SPEnd On PA y
The following table sets out the percentage change in dividends and the overall expenditure on pay (as a whole across
the organisation).
dIvIdEndS And ShARE buybAckS
OvERALL ExPEndITuRE On PA y
52 WEEK PERiod
EndEd 27 SEPTEmbER
2014
53 WEEK PERiod
EndEd 3 ocTobER
2015
2.25 pence per share
3.00
£45,865,000
51,529,000
PERcEnTAGE chAnGE
33%
12%
cOnSIdERAT IOn by ThE dIREcTORS Of mAT TE R S R E L AT In g T O dI R EcT O R S’ R Em unE RAT I On
The committee is composed of the company’s independent non-Executive directors, claire Tiney (chairman), Andy king
and keith down. The company Secretary attends the meetings as secretary to the committee.
The role of the committee is to:
• determine the pay and benefits of the Executive directors in accordance with the Remuneration Policy.
• determine the short and long-term incentives for Executive directors in accordance with the Remuneration Policy.
• To determine awards against incentive schemes.
• To consult with major shareholders about changes to these incentive schemes.
• To determine fees payable to the non-Executive chairman.
• To review the Remuneration Report.
• To monitor the level and structure of remuneration for senior management.
AdvISORS
The committee is assisted in its work by the chief Executive Officer and finance director. The chief Executive Officer
is consulted on the remuneration of those who report directly to him and also of other senior executives. no Executive
director or employee is present or takes part in discussions in respect of matters relating directly to their own remuneration.
during the financial period, the committee received independent advice from the following external consultant:
64
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www.toppstiles.co.uk Stock code: TPTgovernance AdviSoR
dETAiLS of
APPoinTmEnT
SER vicES PRovidEd
by ThE AdviSoR
fEES PAid by ThE
comPAny foR AdvicE
To ThE commiTTEE And
bASiS of chARGE
oThER SER vicES
PRovidEd To ThE
comPAny in ThE 52
WEEK PERiod EndEd
27 SEPTEmbER 2014
dELoiTTE LLP
Appointed by the
Advice on developments in executive
£13000 (excluding vAT).
External auditor and certain
committee in june
pay and the operation of the
2012.
company’s incentive plans.
charged on a time/cost basis
or fixed fee dependent on the
other ser vices (see page 84
of the Annual Report).
Advice on market practice and
nature of the project.
shareholder perspectives.
Advice on the new reporting
regulations in connection with the
disclosure of directors’ remuneration.
The Remuneration committee took into account the Remuneration consultants group’s code of conduct when reviewing
the appointment of deloitte and also took into account deloitte’s role as external auditor. As deloitte is the external auditor
to the company, deloitte’s advice to the Remuneration committee is governed by certain guidelines and safeguards. The
Remuneration committee is satisfied that the remuneration advice provided by deloitte is objective and independent. The
Remuneration committee plans to change the advisors to the committee during this financial year and will commence a
tendering process after the Agm in january 2016.
STATEmEnT Of vOTIng AT LAST Ag m
The following table sets out actual voting in respect of the resolution to approve the directors’ Remuneration Report at the
company’s Annual general meeting on 22 january 2015.
voTES foR
% of voTE
voTES
AGAinST
% of voTE
diScRETion
% of voTE
voTES
WiThhELd
113,470,441
92.33%
9,402,110
7.65%
27,887
0.02%
897,379
RESoLUTion
APPROvE
REmunERATIOn
REPORT
APPROv AL
This Report was approved by the board on 1 december 2015 and signed on its behalf by:
Claire Tiney
chairman of the Remuneration committee
1 december 2015
65
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information Independent AudITORS’ REPORT TO ThE
mEm bERS Of TOPPS TILES PLc
oPinion on finAnciAL
In our opinion:
STATEmEnTS of ToPPS TiLES
•
the financial statements give a true and fair view of the state of the group’s and of the parent company’s affairs as
PLc
at 3 October 2015 and of the group’s profit for the 53 week period then ended;
•
the group financial statements have been properly prepared in accordance with International financial Reporting
Standards (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.
The financial statements comprise the consolidated Statement of financial Performance, the consolidated
Statement of comprehensive Income, the consolidated Statement of financial Position and Parent
company balance Sheet, the consolidated cash flow Statement, the consolidated Statement of changes
in Equity and the related notes 1 to 29. The financial reporting framework that has been applied in the
preparation of the group financial statements is applicable law and 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
generally Accepted Accounting Practice).
SEPARATE oPinion in
As explained in note 2 to the group financial statements, in addition to complying with its legal obligation
RELATion To ifRSS AS iSSUEd
to apply IfRSs as adopted by the European union, the group has also applied IfRSs as issued by the
by ThE iASb
International Accounting Standards board (IASb).
In our opinion the group financial statements comply with IfRSs as issued by the IASb.
GoinG concERn And ThE
As required by the Listing Rules we have reviewed the directors’ statement regarding the appropriateness
diREcToRS’ ASSESSmEnT
of the going concern basis of accounting contained within note 2 to the financial statements and the
of ThE PRinciPAL RiSKS
directors’ statement on the longer-term viability of the group (contained within the strategic report, on
ThAT WoULd ThREATEn ThE
page 24).
SoL vEncy oR LiqUidiTy of
ThE GRoUP
we have nothing material to add or draw attention to in relation to:
•
the directors’ statement in note 2 to the financial statements about whether they considered it appropriate to adopt
the going concern basis of accounting in preparing them and their identification of any material uncertainties to
the group’s ability to continue to do so over a period of at least twelve months from the date of approval of the
financial statements;
•
the director’s explanation (on page 24) as to how they have assessed the prospects of the group, over what
period they have done so and why they consider that period to be appropriate, and their statement as to whether
they have a reasonable expectation that the group will be able to continue in operation and meet its liabilities
as they fall due over the period of their assessment, including any related disclosures drawing attention to any
necessary qualifications or assumptions.
we agreed with the directors’ adoption of the going concern basis of accounting and we did not identify
any such material uncertainties. however, because not all future events or conditions can be predicted,
this statement is not a guarantee as to the group’s ability to continue as a going concern.
indEPEndEncE
we are required to comply with the financial Reporting council’s Ethical Standards for Auditors and we
confirm that we are independent of the group and we have fulfilled our other ethical responsibilities in
accordance with those standards. we also confirm we have not provided any of the prohibited non-audit
ser vices referred to in those standards.
oUR ASSESSmEnT of RiSKS
The assessed risks of material misstatement described below are those that had the greatest effect on our
of mATERiAL miSSTATEmEnT
audit strategy, the allocation of resources in the audit and directing the efforts of the engagement team.
66
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www.toppstiles.co.uk Stock code: TPTfinancial statements OvE RvI Ew
ST R AT EgIc R E P O R T
gOvE RnAn cE
fInAn cI A L S TAT EmEnT S
Ad dI T I OnA L In fO RmAT I On
Financial
Statements
C o n t e n t s
66 IndEPEndEnT AudITOR’S REPORT
71 cOnSOLIdATEd STATEmEnT
Of fInAncIAL PERfORmAncE
71 cOnSOLIdATEd STATEmEnT
Of cOmPREhEnSIvE IncOmE
72 cOnSOLIdATEd STATEmEnT Of
fInAncIAL POSITIOn
73 cOnSOLIdATEd STATEmEnT Of
chAngES In EquITy
74 cOnSOLIdATEd cASh fLOw
STATEmEnT
75 nOTES TO ThE fInAncIAL STATEmEnT
RiSK
hoW ThE ScoPE of oUR AUdiT RESPondEd
To ThE RiSK
invEnToR y
we tested the cost of inventor y (on a sample
The key inventor y risk
basis) by reference to supplier invoice costs. we
relates to the valuation
have performed our net realisable value testing to
of inventor y (which
determine that the group sells these products at a
includes tiles, adhesives,
price greater than cost.
stone and wood
products), given the size
of the inventor y balance
(gross inventor y – £30.2
million) and it is the
Additionally, in performing our net realisable value
testing, we have compared the level of provisioning
made by management against sales made below cost
during the period and after the period end.
single largest current
we have also reviewed sales made post year end
asset balance on the
to determine if any further inventor y lines were sold
consolidated statement
below cost.
of financial position.
PRoPERTy PRoviSionS
we assessed the appropriateness and completeness
The property provisions
of onerous lease and dilapidation provisions by
arise from the group’s
challenging management’s principal assumptions
portfolio of 347 stores.
in identifying and providing for the group’s at-risk
The appropriateness
properties.
and completeness of
Our audit team included property specialists who
onerous lease (£1.4
assisted us in evaluating the directors’ estimates,
million) and dilapidation
for example, those relating to the length of time
provisions (£1.6 million)
anticipated to exit onerous lease agreements on
in relation to those stores
vacant or loss making stores.
is judgemental as they
include an assessment of
the likely future periods
over which leasehold
properties may be vacant
and estimates of future
costs of making good
we also challenged management’s assumptions
in relation to the calculation of onerous leases at
loss-making stores by reviewing management’s track
record of returning such stores to profit and the period
of time management assume will take to exit the
property where relevant.
dilapidations.
we have also challenged management’s assumptions
regarding the calculation of the dilapidation
The accounting policies
provision, including validating property information
in respect of property
back to the original lease documentation and
provisions are outlined
agreeing dilapidation charges historically incurred to
in note 2(w).
third party source. In performing this work we have
The balance sheet
assessed whether the provisions are appropriately
provisions are disclosed
discounted.
in note 19.
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015
Independent AudITORS’ REPORT TO ThE
mEm bERS Of TOPPS TILES PLc
cOnT In uEd
RiSK
hoW ThE ScoPE of oUR AUdiT RESPondEd To ThE RiSK
REvEnUE REcoGniTion
we have performed substantive testing of revenue recorded within the first
we have identified a revenue risk in relation to the timing
and last 15 days of the 2016 and 2015 financial periods (on a sample basis)
of revenue recognition on open orders (i.e. sales not
respectively to test the appropriateness of revenue recognition of open orders
completed) where goods can take up to 15 days to be
around the period end and that only delivered/collected goods have been
delivered and therefore could be subject to manipulation.
recognised as income in the year.
The risk also encompasses store sales where deposits are
made for inventor y items which have a long lead time or
are currently out of stock.
The group’s policy, as outlined in note 2(f), is to recognise
such revenue when the inventor y is delivered or collected
as opposed to when payment is received (which is earlier).
we have in turn, agreed amounts where legal title of the goods have not been
transferred, back to the deposit liability recorded within the balance sheet.
AccoUnTinG foR SUPPLiER REbATES
for those agreements open at the year-end we obtained a sample of supplier
The group has a number of contractual incentives including
agreements and assessed the appropriateness of the recognition of income by
rebates with its suppliers. These arrangements have a
assessing the underlying contractual arrangements, the likelihood of meeting the
number of thresholds and settlement dates that require
contractual thresholds (considering the volumes achieved at the period end and
management to exercise judgment when calculating the
the level of activity with the customer) and recalculating the amount of income
rebate receivable and the appropriate recognition within
recognised.
the income statement.
we performed analytical procedures (alongside our other substantive tests)
The accounting policy for supplier income is detailed in
for supplier agreements recognised, such as comparing income to the level of
note 2(w).
purchases and sales made, to assess the completeness of the supplier income
in the year. we also arranged for a sample of supplier confirmations to be
circularised to confirm the carr ying values at the period end.
AccoUnTinG foR RESTRUcTURinG PRoviSionS
Our work on property related charges has been performed alongside our
during the year costs of £2.6 million have been recognised
property provision risk procedures. further to this, we have assessed whether
by the group relating to the restructuring of the group’s
the communications to landlords occurred before the balance sheet date
operations. This was in order to focus on the core Topps
and the strategic plan had been widely announced so that the restructuring
Tiles business following closure of 9 Tile clearance stores
recognition criteria were met. Additionally we confirmed that for all closed
and to realise synergies with one head office function. Of
Tile clearance stores the carr ying value of property, plant and equipment was
this £1.7 million relates to property charges (onerous leases
provided for.
we have performed substantive testing over the redundancy element including
reviewing correspondence with the affected parties so as to assess whether the
recognition criteria were met. we obtained management’s calculation of the
redundancy provision and validated the relevant inputs to respective employee
data.
and impairment of property, plant and equipment) and
£0.9 million relates to redundancy costs which includes
relocation of the finance function to the head office in
Leicester. Restructuring provisions need to meet specific
criteria (possessing a detailed formal plan and raising a
valid expectation in those affected by the plan) in order
to be eligible for recognition and require management
judgement when calculating the amounts that require
provision.
The group’s accounting policies for restructuring provisions
and property provisions are in note 2(w). The provision
balance is disclosed in note 19.
In the current period an additional risk has been included within this audit report relating to the accounting for the provisions relating to
the restructuring of the group’s operations which resulted in costs totalling £2.6 million.
The description of risks above should be read in conjunction with the significant issues considered by the Audit committee discussed on
pages 46 and 47.
These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and
we do not provide a separate opinion on these matters.
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we define materiality as the magnitude of misstatement in the financial statements that makes it probable
mATERiALiTy
that the economic decisions of a reasonably knowledgeable person would be changed or influenced. we
use materiality both in planning the scope of our audit work and in evaluating the results of our work.
we determined materiality for the group to be £1,000,000 (2014: £829,000), which is 5% (2014: 5%)
of normalised pre-tax profit (2014: statutor y pre-tax profit). Pre-tax profit has been normalised by adding
back restructuring costs incurred during the year of £2.6 million as these have been determined to be non-
recurring and the normalised profit more truly represents the underlying business. There were no such costs
in the previous year and as such no normalisation adjustments were applied.
we agreed with the Audit committee that we would report to the committee all audit differences in excess
of £20,000 (2014: £16,000), as well as differences below that threshold that, in our view, warranted
reporting on qualitative grounds. we also report to the Audit committee on disclosure matters that we
identified when assessing the overall presentation of the financial statements.
An ovER viEW of ThE ScoPE
Our group audit was scoped by obtaining an understanding of the group and its environment, including
of oUR AUdiT
group-wide controls, and assessing the risks of material misstatement. Audit work to respond to the risks of
material misstatement was performed directly by the group audit engagement team.
given the nature of the group’s corporate structure where all evidence relating to each component
is compiled at the group’s head office, we performed an audit covering all of the group’s trading
components. with the exception of dormant components, no components were scoped out of the audit.
Our audit work was executed at levels of materiality applicable to each individual entity which were
lower than group materiality and ranged from £2,000 to £900,000 (2014: £6,000 to £746,000).
At the parent entity level we also tested the consolidation process and carried out analytical procedures
to confirm our conclusion that there were no significant risks of material misstatement of the aggregated
financial information of the remaining components not subject to audit or audit of specified account
balances.
As part of the inventor y count programme, alongside attendance at the group’s main warehouse, members
of the audit team attended 22 (2014: 12) of the group’s stores as part of their consideration of the
controls around revenue, inventor y, inventor y count procedures and physical asset verification. This
programme of visits was designed so that the audit team visited different store locations compared to
previous years depending upon risks identified in conjunction with the work performed by Internal Audit.
oPinion on oThER
In our opinion:
mATTERS PREScRibEd by ThE
•
the part of the directors’ Remuneration Report to be audited has been properly prepared in accordance with the
comPAniES AcT 2006
companies Act 2006; and
•
the information given in the Strategic Report and the directors’ Report for the financial year for which the financial
statements are prepared is consistent with the financial statements.
mATTERS on Which WE ARE REqUiREd To REPoRT by ExcEPTion
AdEqUAcy of ExPLAnATionS
under the companies Act 2006 we are required to report to you if, in our opinion:
REcEivEd And AccoUnTinG
• we have not received all the information and explanations we require for our audit; or
REcoRdS
• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have
not been received from branches not visited by us; or
•
the parent company financial statements are not in agreement with the accounting records and returns.
• we have nothing to report in respect of these matters.
diREcToRS’ REmUnERATion
under the companies Act 2006 we are also required to report if in our opinion certain disclosures of
directors’ remuneration have not been made or the part of the directors’ Remuneration Report to be
audited is not in agreement with the accounting records and returns. we have nothing to report arising
from these matters.
69
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mEm bERS Of TOPPS TILES PLc
cOnT In uEd
coRPoRATE GovERnAncE
under the Listing Rules we are also required to review part of the corporate governance Statement
STATEmEnT
relating to the company’s compliance with certain provisions of the uk corporate governance code. w e
have nothing to report arising from our review.
oUR dUTy To REAd oThER
under International Standards on Auditing (uk and Ireland), we are required to report to you if, in our
infoRmATion in ThE
opinion, information in the annual report is:
AnnUAL REPoRT
• materially inconsistent with the information in the audited financial statements; or
• apparently materially incorrect based on, or materially inconsistent with, our knowledge of the group acquired in
the course of performing our audit; or
• otherwise misleading.
In particular, we are required to consider whether we have identified any inconsistencies between our
knowledge acquired during the audit and the directors’ statement that they consider the annual report is
fair, balanced and understandable and whether the annual report appropriately discloses those matters
that we communicated to the audit committee which we consider should have been disclosed. we confirm
that we have not identified any such inconsistencies or misleading statements.
RESPEcTivE RESPonSibiLiTiES
As explained more fully in the directors’ Responsibilities Statement, the directors are responsible for the
of diREcToRS And AUdiToR
preparation of the financial statements and for being satisfied that they give a true and fair view. Our
responsibility is to audit and express an opinion on the financial statements in accordance with applicable
law and International Standards on Auditing (uk and Ireland). we also comply with International Standard
on quality control 1 (uk and Ireland). Our audit methodology and tools aim to ensure that our quality
control procedures are effective, understood and applied. Our quality controls and systems include our
dedicated professional standards review team and independent partner reviews.
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.
ScoPE of ThE AUdiT of ThE
An audit involves obtaining evidence about the amounts and disclosures in the financial statements
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 annual report to identify material inconsistencies with the audited financial
statements and to identify any information that is apparently materially incorrect based on, or materially
inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become
aware of any apparent material misstatements or inconsistencies we consider the implications for our
report.
Damian Sanders (Senior satutory auditor)
for and on behalf of deloitte LLP
chartered Accountants and Statutory Auditor
manchester
united kingdom
1 december 2015
70
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Consolidated STATEmEnT Of
fInAn cIAL PERfORmAncE
fO R ThE 5 3 wE EkS En dEd 3 OcT ObE R 2 0 1 5
GRoUP REvEnUE – conTinUinG oPERATionS
cOST Of SALES
gROSS PROfIT
EmPLOyEE PROfIT ShARIng
dISTRIbuTIOn And SELLIng cOSTS
OThER OPERATIng ExPEnSES
AdmInISTRATIvE cOSTS
SALES And mARkETIng cOSTS
GRoUP oPERATinG PRofiT bEfoRE ExcEPTionAL iTEmS
buSInESS SImPLIfIcATIOn cOSTS
GRoUP oPERATinG PRofiT
OThER (LOSSES)/gAInS
InvESTmEnT REvEnuE
fInAncE cOSTS
PRofiT bEfoRE TAxATion
TAxATIOn
PRofiT foR ThE PERiod ATTRibUTAbLE To EqUiTy hoLdERS of ThE comPAny
EARninGS PER oRdinAR y ShARE fRom conTinUinG oPERATionS
— bASIc
— dILuTEd
Consolidated STATEmEnT Of
cOmP REhEnSIvE IncOmE
fO R ThE 5 3 wE EkS En dEd 3 OcT ObE R 2 0 1 5
PROfIT fOR ThE PERIOd
TOTAL cOmPREhEnSIvE IncOmE fOR ThE PERIOd ATTRIbuTAbLE
TO EquITy hOLdERS Of ThE PAREnT cOmPAny
Proof 9 9 December 2015 6:10 PM 24457.04
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
3
212,221
195,237
(82,319)
(76,367)
129,902
118,870
(10,405)
(76,204)
(5,846)
(9,827)
(69,161)
(5,359)
(13,485)
(11,665)
4
5
7
7
5
8
26
10
(5,079)
21,502
(2,619)
18,883
(23)
242
(2,083)
17,019
(3,954)
13,065
6.75p
6.73p
(4,672)
18,186
–
18,186
401
251
(2,147)
16,691
(4,179)
12,512
6.49p
6.43p
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
13,065
12,512
13,065
12,512
71
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information
Consolidated STATEmEnT Of
fInAn cIAL POSITIOn
A S AT 3 OcT ObE R 2 0 1 5
non-cURREnT ASSETS
gOOdwILL
dEfERREd TAx ASSET
PROPERTy, PLAnT And EquIPmEnT
cURREnT ASSETS
InvEnTORIES
TRAdE And OThER REcEIv AbLES
cASh And cASh EquIv ALEnTS
ToTAL ASSETS
cURREnT LiAbiLiTiES
TRAdE And OThER PA yAbLES
cuRREnT TAx LIAbILITIES
PROvISIOnS
nET cURREnT ASSETS
non-cURREnT LiAbiLiTiES
bAnk LOAnS
dEfERREd TAx LIAbILITIES
PROvISIOnS
ToTAL LiAbiLiTiES
nET ASSETS
EqUiTy
ShARE cAPITAL
ShARE PREmIum
Own ShARES
mERgER RESERvE
ShARE bASEd PA ymEnT RESERvE
cAPITAL REdEmPTIOn RESERvE
RETAInEd LOSSES
ToTAL fUndS ATTRibUTAbLE To EqUiTy hoLdERS of ThE PAREnT
The accompanying notes are an integral part of these financial statements.
notes
2015
£’000
2014
£’000
11
19
12
14
15
16
19
17
19
19
20
21
22
23
24
25
26
245
319
47,094
47,658
27,408
8,041
16,564
52,013
99,671
245
–
41,294
41,539
27,846
5,800
19,547
53,193
94,732
(33,987)
(36,240)
(5,048)
(1,736)
(40,771)
11,242
(4,888)
(876)
(42,004)
11,189
(44,692)
(49,581)
–
(3,410)
(261)
(2,043)
(88,873)
(93,889)
10,798
843
6,457
1,906
(630)
(399)
2,820
20,359
6,455
1,879
(656)
(399)
1,941
20,359
(19,715)
(28,736)
10,798
843
The financial statements of Topps Tiles Plc, registered number 3213782, on pages 71 to 99 were approved by the board of directors
and authorised for issue on 1 december 2015. They were signed on its behalf by:
M T M Williams
R Parker
directors
72
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Consolidated STATEmEnT Of
c hAngES In EquITy
fO R ThE 5 3 wE EkS En dEd 3 OcT ObE R 2 0 1 5
ShARE
cAPiTAL
£’000
ShARE
PREmiUm
£’000
oWn
ShARES
£’000
mERGER
RESERvE
£’000
ShARE-
bASEd
PAymEnT
RESERvE
£’000
cAPiTAL
REdEmPTion
RESERvE
£’000
RETAinEd
EARninGS
£’000
ToTAL
EqUiTy
£’000
6,404
1,492
(10)
(399)
649
20,359
(38,679)
(10,184)
–
51
–
387
–
–
–
–
–
–
–
–
–
–
–
–
–
(650)
4
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,292
–
–
–
–
–
–
–
–
12,512
12,512
–
438
(3,175)
(3,175)
–
–
–
(650)
4
1,292
606
606
6,455
1,879
(656)
(399)
1,941
20,359
(28,736)
843
–
2
–
–
–
–
–
–
27
–
–
–
–
–
–
–
–
(504)
530
–
–
–
–
–
–
–
–
–
–
–
–
–
–
879
–
–
–
–
–
–
–
–
13,065
13,065
–
29
(4,534)
(4,534)
–
–
–
490
(504)
530
879
490
6,457
1,906
(630)
(399)
2,820
20,359
(19,715)
10,798
bALAncE AT
28 SEPTEmbER 2013
PROfIT And TOTAL
cOmPREhEnSIvE IncOmE fOR
ThE PERIOd
ISSuE Of ShARE cAPITAL
dIvIdEndS
Own ShARES PuRchASEd In
ThE PERIOd
Own ShARES ISSuEd In ThE
PERIOd
cREdIT TO EquITy fOR EquITy-
SETTLEd ShARE bASEd PA ymEnTS
dEfERREd TAx On ShARE-bASEd
PAymEnT TRAnSAcTIOnS
bALAncE AT
27 SEPTEmbER 2014
PROfIT And TOTAL
cOmPREhEnSIvE IncOmE fOR
ThE PERIOd
ISSuE Of ShARE cAPITAL
dIvIdEndS
Own ShARES PuRchASEd In
ThE PERIOd
Own ShARES ISSuEd In ThE
PERIOd
cREdIT TO EquITy fOR EquITy-
SETTLEd ShARE bASEd PA ymEnTS
dEfERREd TAx On ShARE-bASEd
PAymEnT TRAnSAcTIOnS
bALAncE AT
3 ocTobER 2015
73
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information
Consolidated cASh fLOw STATEmEnT
fO R ThE 5 3 wE EkS En dEd 3 OcT ObE R 2 0 1 5
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
13,065
12,512
3,954
2,083
(242)
23
4,179
2,147
(251)
(401)
18,883
18,186
5,243
432
1,409
2,619
(2,125)
438
(2,680)
24,219
(1,882)
(3,882)
18,455
4,553
348
1,292
–
1,834
(1,650)
348
24,911
(1,695)
(2,582)
20,634
127
140
(12,058)
(11,450)
512
(504)
733
(646)
(11,923)
(11,223)
(4,534)
(3,175)
29
(10)
(5,000)
(9,515)
(2,983)
19,547
16,564
438
(570)
(5,000)
(8,307)
1,104
18,443
19,547
cASh fLoW fRom oPERATinG AcTiviTiES
PROfIT fOR ThE PERIOd
TAxATIOn
fInAncE cOSTS
InvESTmEnT REvEnuE
OThER gAInS/(LOSSES) On SALE Of fREEhOLd PROPERTIES
gROuP OPERATIng PROfIT
Adjustments for:
dEPREcIATIOn Of PROPERTy, PLAnT And EquIPmEnT
ImPAIRmEnT Of PROPERTy, PLAnT And EquIPmEnT
ShARE OPTIOn chARgE
buSInESS SImPLIfIcATIOn cOSTS
(IncREASE)/dEcREASE In TRAdE And OThER REcEIv
AbLES
dEcREASE/(IncREASE) In InvEnTORIES
(dEcREASE)/IncREASE In PA yAbLES
cASh GEnERATEd by oPERATionS
InTEREST PAId
TAxATIOn PAId
net cAsh from operA ting Activities
invESTinG AcTiviTiES
InTEREST REcEIvEd
PuRchASE Of PROPERTy, PLAnT And EquIPmEnT
PROcEEdS On dISPOSAL Of PROPERTy, PLAnT And EquIPmEnT
PuRchASE Of Own ShARES
net cAsh used in investment Activities
finAncinG AcTiviTiES
dIvIdEndS PAId
PROcEEdS fROm ISSuE Of ShARE cAPITAL
LOAn ISSuE cOSTS
REPAymEnT Of bAnk LOAnS
net cAsh used in finAncing Activities
nET (dEcREASE)/IncREASE In cASh And cASh EquIv
ALEnTS
cASh And cASh EquIv ALEnTS AT bEgInnIng Of PERIOd
cASh And cASh EqUiv ALEnTS AT End of PERiod
74
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Notes TO ThE fInAncIAL STATEmEnTS
fO R ThE 5 3 wE EkS En dEd 3 OcT ObE R 2 0 1 5
1 gEnERAL InfORmATIOn
Topps Tiles Plc is a company incorporated in the united kingdom under the companies Act 2006. The address of the registered office is given
on page 37. The nature of the group’s operations and its principal activity are set out in the directors’ Report on page 38.
These financial statements are presented in pounds sterling because that is the currency of the primary economic environment in which the group
operates.
ADOPTION OF NEw AND REvISED STANDARDS
In the current period, the following new and revised standards and interpretations have been adopted and may affect the future amounts reported
in the financial statements:
IfRS 13 – fair value measurement, this standard defines fair value, sets out in a single IfRS a framework for measuring fair value and requires
disclosures about fair value measurements.
STANDARDS NOT AFFECTING ThE REPORTED RESuLTS NOR ThE FINANCIAL POSITION
The following new and revised Standards and Interpretations have been adopted in the current year. Their adoption has not had any significant
impact on the amounts reported in these financial statements that may impact the accounting for future transactions and arrangements.
IAS 1 (amended) – Presentation of Items of Other comprehensive Income, the amendments improve the consistency and clarity of the presentation
of items of other comprehensive income.
IAS 19 (revised) – Employee benefits, this revised standard prescribes the accounting and disclosure by employers for employee benefits.
Improvements to IfRSs 2011–13. Aside from those items already identified above, the amendments made to standards under the 2010
improvements to IfRSs have had no impact and will not have any impact on the group.
At the date of authorisation of these financial statements, the following Standards and Interpretations which have not been applied in these
financial statements were in issue but not yet effective (and in some cases had not yet been adopted by the Eu):
IfRS 9 – financial Instruments
IfRS 11 – joint Arrangements
IfRS 15 – Revenue from contracts with customers
IAS 16 and IAS 38 (amended): clarification of Acceptable methods of depreciation and Amortisation
IAS 27 (amended): Equity method in Separate financial Statements
IAS 1 – disclosure initiative
The directors anticipate that the adoption of these standards and interpretations in future periods will have no material impact on the financial
statements of the group.
2 AccOunTIng POLIcI ES
The principal accounting policies adopted are set out below.
A) BASIS OF ACCOuNTING
The financial statements have been prepared in accordance with International financial Reporting Standards ‘IfRSs’. The financial statements
have also been prepared in accordance with IfRSs adopted by the European union and therefore the group financial statements comply
with Article 4 of the Eu IAS regulation. The financial statements have been prepared on the historical cost basis, except for the revaluation of
derivative financial instruments. historical cost is generally based on the fair value of the consideration given in exchange for the assets.
B) GOING CONCERN
when considering the going concern test the board review several factors including a detailed review of the above risks and uncertainties, the
group’s forecast covenant and cash headroom against lending facilities and management’s current expectations (see Strategic Report for further
details). As a result of this review the board believes that the group will continue to meet all of its financial commitments as they fall due and will
be able to continue as a going concern. Therefore, the board considers it appropriate to prepare the financial statements on the going concern
basis.
75
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cOnT In uEd
2 AccOunTIng POLIcI ES cOnT InuEd
C) BASIS OF CONSOLIDATION
The consolidated financial statements incorporate the financial statements of the company and entities controlled by the company (its
subsidiaries). control is achieved where the company has the power to govern the financial and operating policies of an investee entity so as to
obtain benefits from its activities.
The results of subsidiaries acquired or disposed of during the period are included in the consolidated Statement of financial Performance from
the effective date of acquisition or up to the effective date of disposal, as appropriate. where necessary, adjustments are made to the financial
statements of subsidiaries to bring the accounting policies used into line with those used by the group. All intra-group transactions, balances,
income and expenses are eliminated on consolidation.
D) FINANCIAL PERIOD
The accounting period ends on the Saturday which falls closest to 30 September, resulting in financial periods of either 52 or 53 weeks.
Throughout the financial statements, directors’ Report and business Review, references to 2015 mean at 3 October 2015 or the 53 weeks then
ended; references to 2014 mean at 27 September 2014 or the 52 weeks then ended.
E) GOODwILL
goodwill arising in a business combination is recognised as an asset at the date that control is acquired (the acquisition date). goodwill is
measured as the excess of the sum of the consideration transferred, the amount of any non-controlling interest in the acquiree and the fair value of
the acquirer’s previously held equity interest (if any) in the entity over the net of the acquisition-date amounts of the identifiable assets acquired and
the liabilities assumed.
If, after reassessment, the group’s interest in the fair value of the acquiree’s identifiable net assets exceeds the sum of the consideration transferred,
the amount of any non-controlling interest in the acquiree and the fair value of the acquirer’s previously held equity interest in the acquiree (if any),
the excess is recognised immediately in profit or loss as a bargain purchase gain.
goodwill is not amortised but is reviewed for impairment at least annually. for the purpose of impairment testing, goodwill is allocated to each of
the group’s cash-generating units expected to benefit from the synergies of the combination. cash-generating units to which goodwill has been
allocated are tested for impairment annually, or more frequently when there is an indication that the unit may be impaired. If the recoverable
amount of the cash-generating unit is less than the carrying amount of the unit, the impairment loss is allocated first to reduce the carrying amount
of any goodwill allocated to the unit and then to the other assets of the unit pro-rata on the basis of the carrying amount of each asset in the unit.
An impairment loss recognised for goodwill is not reversed in a subsequent period.
On disposal of a subsidiary, the attributable amount of goodwill is included in the determination of the profit or loss on disposal.
goodwill arising on acquisitions before the date of transition to IfRSs has been retained at the previous uk gAAP amounts subject to being tested
for impairment at that date. goodwill of £15,080,000 written off to reserves under uk gAAP prior to 1998 has not been reinstated and will not
be included in determining any subsequent profit or loss on disposal.
F) REvENuE RECOGNITION
Revenue is measured at the fair value of the consideration received or receivable and represents amounts receivable for goods and services
provided in the normal course of business, net of discounts, vAT and other sales-related taxes.
Revenue from the sale of goods is recognised when all the following conditions are satisfied:
• the group has transferred to the buyer the significant risks and rewards of ownership of the goods;
• the group retains neither continuing managerial involvement to the degree usually associated with ownership nor effective control over
the goods sold;
• the amount of revenue can be measured reliably;
• it is probable that the economic benefits associated with the transaction will flow to the entity; and
• the costs incurred or to be incurred in respect of the transaction can be measured reliably.
The level of sales returns is closely monitored by management and provided for when management considers them to be significant and deducted
from income.
Interest income is recognised when it is probable that the economic benefits will flow to the group and the amount of income can be measured
reliably. Interest income is accrued on a time basis, by reference to the principal outstanding and at the effective interest rate applicable, which is
the rate that exactly discounts estimated future cash receipts through the expected life of the financial asset to that asset’s net carrying amount on
initial recognition.
dividend income from investments is recognised when the shareholders’ rights to receive payment have been established (provided that it is
probable that the economic benefit will flow to the group and the amount of income can be measured reliably).
76
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G) ExCEPTIONAL ITEMS
Items are classed as exceptional where they relate to one-off costs incurred in the period that the directors do not expect to be repeated in
the same magnitude on an annual basis, or where the directors consider the separate disclosure to be necessary to understand the group’s
performance. The principles applied in identifying exceptional costs are consistent between periods. See note 4 for details of exceptional items in
the current period.
h) PROPERTy, PLANT AND EquIPMENT
Property, plant and equipment are stated at cost less accumulated depreciation and any recognised impairment loss.
depreciation is charged so as to write off the cost of assets, less estimated residual value, over their estimated useful lives, on the following bases:
fREEhOLd buILdIngS
2% PER Annum On cOST On A STRAIghT
-LInE bASIS
ShORT LEASEhOLd LAnd And buILdIngS
OvER ThE PERIOd Of ThE LEASE, uP TO 25 yEARS On A STRAIghT LInE bASIS
fIxTuRES And fITTIngS
OvER 10 yEARS, ExcEPT fOR ThE fOLLOwIng; 4 yEARS fOR cOmPuTER EquIPmEnT
OR 5 yEARS fOR dISPLA y STAndS, PER Annum AS APPROPRIATE
mOTOR vEhIcLES
25% PER Annum On A REducIng bALAncE bASIS
freehold land is not depreciated.
Residual value is calculated on prices prevailing at the date of acquisition.
Assets held in the course of construction for production, supply or administrative purposes, or for purposes not yet determined, are carried at cost,
less any recognised impairment loss. cost includes professional fees and, for qualifying assets, borrowing costs capitalised in accordance with
the group’s accounting policy. depreciation of these assets, on the same basis as other property assets, commences when the assets are ready
for their intended use.
The gain or loss arising on the disposal or retirement of an asset is determined as the difference between the sales proceeds and the carrying
amount of the asset and is recognised in the Statement of financial Performance.
I) IMPAIRMENT OF TANGIBLE AND INTANGIBLE ASSETS ExCLuDING GOODwILL
At each period end, the group reviews the carrying amounts of its tangible assets to determine whether there is any indication that those assets
have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent
of the impairment loss (if any). where the asset does not generate cash flows that are independent from other assets, the group estimates the
recoverable amount of the cash-generating unit to which the asset belongs. An intangible asset with an indefinite useful life is tested for impairment
at least annually and whenever there is an indication that the asset may be impaired.
Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future post-tax cash flows
are discounted to their present value using a post-tax discount rate that reflects current market assessments of the time value of money and the risks
specific to the asset for which the estimates of future cash flows have not been adjusted.
If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset
(cash-generating unit) is reduced to its recoverable amount. An impairment loss is recognised as an expense immediately, unless the relevant asset
is carried at a re-valued amount, in which case the impairment loss is treated as a revaluation decrease.
where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of
its recoverable amount, but so that the increased carrying amount does not exceed the carrying amount that would have been determined had
no impairment loss been recognised for the asset (cash-generating unit) in prior years. A reversal of an impairment loss is recognised as income
immediately, unless the relevant asset is carried at a revalued amount, in which case the reversal of the impairment loss is treated as a revaluation
increase.
j) INvENTORIES
Inventories are stated at the lower of cost and net realisable value and relate solely to finished goods for resale, and net of supplier rebates.
cost comprises the purchase price of materials and an attributable proportion of distribution overheads based on normal levels of activity and is
valued at standard cost. net realisable value represents the estimated selling price, less costs to be incurred in marketing, selling and distribution.
Provision is made for those items of inventory where the net realisable value is estimated to be lower than cost. The net replacement value of
inventories is not considered materially different from that stated in the consolidated Statement of financial Position.
77
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Notes TO ThE fInAncIAL STATEmEnTS
cOnT In uEd
2 AccOunTIng POLIcI ES cOnT InuEd
k) TAxATION
The tax expense represents the sum of the tax charge for the period and deferred tax.
The tax currently payable is based on taxable profit for the period. Taxable profit differs from net profit as reported in the Statement of financial
Performance because it excludes items of income or expense that are taxable or deductible in other periods and it further excludes items that are never
taxable or deductible. The group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance
sheet date.
deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial
statements and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the balance sheet liability method.
deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is
probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not
recognised if the temporary difference arises from the initial recognition of goodwill or from the initial recognition (other than in a business combination)
of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.
deferred tax liabilities are recognised for taxable temporary differences arising on investments in subsidiaries, and interests in jointly controlled entities,
except where the group is able to control the reversal of the temporary difference and it is probable that the temporary difference will not reverse in the
foreseeable future.
deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised based on tax laws
and rates that have been enacted at the balance sheet date. deferred tax is charged or credited in the Statement of financial Performance, except when
it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.
deferred tax assets and liabilities are offset when there is a legally enforceable right to set off current tax assets against current tax liabilities and when
they relate to income taxes levied by the same taxation authority and the group intends to settle its current tax assets and liabilities on a net basis.
L) FOREIGN CuRRENCy
The individual financial statements of each group company are presented in pounds sterling (its functional currency). for the purpose of the
consolidated financial statements, the results and financial position of each group company are expressed in pounds sterling, which is the
functional currency of the company, and the presentational currency for the consolidated financial statements.
Transactions in currencies other than the entity’s functional currency (foreign currencies) are recorded at the rates of exchange prevailing on the
dates of transactions. At each period end, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the
rates prevailing on that date. non-monetary items carried at fair value that are denominated in foreign currencies are retranslated at the rates
prevailing at the date when the fair value was determined. non-monetary items that are measured in terms of historical cost in a foreign currency
are not retranslated.
Exchange differences arising on the settlement of monetary items, and on the retranslation of monetary items, are included in the Statement of
financial Performance for the period.
Exchange differences arising on the retranslation of non-monetary items carried at fair value are included in Statement of financial Performance
for the period.
Exchange differences are recognised in profit or loss in the period in which they arise except for:
• exchange differences on transactions entered into to hedge certain foreign currency risks (see below under financial instruments/
hedge accounting); and
• exchange differences on monetary items receivable from or payable to a foreign operation for which settlement is neither planned
nor likely to occur (therefore forming part of the net investment in the foreign operation), which are recognised initially in other
comprehensive income and reclassified from equity to profit or loss on disposal or partial disposal of the net investment.
M) LEASES
Rentals payable under operating leases are charged to income on a straight line basis over the term of the relevant lease even where payments
are not made on such a basis, except where another more systematic basis is more representative of the time pattern in which economic benefits
from the lease asset are consumed or a provision has been made for an onerous lease. contingent rentals arising under operating leases are
recognised as an expense in the period in which they are incurred.
In the event that lease incentives are received to enter into operating leases, such incentives are recognised as a liability. The aggregate benefit
of incentives is recognised as a reduction of rental expense on a straight-line basis, except where another systematic basis is more representative
of the time pattern in which economic benefits from the leased asset are consumed.
The group provides for the unavoidable costs prior to lease termination or sub-lease relating to onerous leases. dilapidation costs are provided
for against all leasehold properties across the entire estate.
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N) INvESTMENTS
fixed asset investments are shown at cost less provision for impairment.
O) RETIREMENT BENEFIT COSTS
for defined contribution schemes, the amount charged to the Statement of financial Performance in respect of pension costs is the contributions
payable in the period. differences between contributions payable in the period and contributions actually paid are shown as either accruals or
prepayments in the consolidated Statement of financial Position.
P) FINANCE COSTS
finance costs which are directly attributable to the construction of tangible fixed assets are capitalised as part of the cost of those assets. The
commencement of capitalisation begins when both finance costs and expenditures for the asset are being incurred and activities that are
necessary to get the asset ready for use are in progress. capitalisation ceases when substantially all the activities that are necessary to get the
asset ready for use are complete.
All other finance costs of debt are recognised in the Statement of financial Performance over the term of the debt at a constant rate on the
carrying amount.
q) FINANCIAL INSTRuMENTS
financial assets and financial liabilities are recognised in the group’s Statement of financial Position when the group becomes a party to the
contractual provisions of the instrument.
All financial assets are recognised and derecognised on a trade date where the purchase or sale of a financial asset is under a contract whose
terms require delivery of the financial asset within the timeframe established by the market concerned, and are initially measured at fair value, plus
transaction costs, except for those financial assets classified as at fair value through profit or loss, which are initially measured at fair value.
financial assets are classified into the following specified categories: financial assets ‘at fair value through profit or loss’ (fvTPL), ‘held-to-maturity’
investments, ‘available-for-sale’ (AfS) financial assets and ‘loans and receivables’. The classification depends on the nature and purpose of the
financial assets and is determined at the time of initial recognition.
FINANCIAL ASSETS AT FvTPL
financial assets are classified as at fvTPL where the financial asset is either held for trading or it is designated as at fvTPL. The group has no
designated fvTPL financial assets.
A financial asset is classified as held for trading if:
• it has been acquired principally for the purpose of selling in the near future; or
• it is a part of an identified portfolio of financial instruments that the group manages together and has a recent actual pattern of short-
term profit-taking; or
• it is a derivative that is not designated and effective as a hedging instrument.
financial assets at fvTPL are stated at fair value, with any resultant gain or loss recognised in profit or loss. The directors use their judgement in
selecting an appropriate valuation technique for financial instruments not quoted in an active market. valuation techniques commonly used by
market practitioners are applied, such as discounted cash flows and assumptions regarding market volatility.
LOANS AND RECEIv ABLES
Trade receivables, loans, and other receivables that have fixed or determinable payments that are not quoted in an active market are classified
as loans and receivables. Loans and receivables are measured at amortised cost using the effective interest method, less any impairment.
Interest income is recognised by applying the effective interest rate, except for short-term receivables when the recognition of interest would be
immaterial.
EFFECTIvE INTEREST METhOD
The effective interest method is a method of calculating the amortised cost of a debt instrument and of allocating interest income over the relevant
period. The effective interest rate is the rate that exactly discounts estimated future cash receipts (including all fees on points paid or received
that form an integral part of the effective interest rate, transaction costs and other premiums or discounts) through the expected life of the debt
instrument, or, where appropriate, a shorter period, to the net carrying amount on initial recognition.
Income is recognised on an effective interest basis for debt instruments other than those financial assets and liabilities classified as at fvTPL.
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cOnT In uEd
2 AccOunTIng POLIcI ES cOnT InuEd
IMPAIRMENT OF FINANCIAL ASSETS
financial assets, other than those at fvTPL, are assessed for indicators of impairment at each Statement of financial Position date. financial assets are
impaired where there is objective evidence that, as a result of one or more events that occurred after the initial recognition of the financial asset, the
estimated future cash flows of the investment have been impacted.
for certain categories of financial asset, such as trade receivables, assets that are assessed not to be impaired individually are subsequently assessed
for impairment on a collective basis. Objective evidence of impairment for a portfolio of receivables could include the group’s past experience
of collecting payments, an increase in the number of delayed payments in the portfolio past the average credit period of 43 days, as well as
observable changes in national or local economic conditions that correlate with default on receivables.
for financial assets carried at amortised cost, the amount of the impairment is the difference between the asset’s carrying amount and the present
value of estimated future cash flows, discounted at the financial asset’s original effective interest rate.
The carrying amount of the financial asset is reduced by the impairment loss directly for all financial assets with the exception of trade receivables,
where the carrying amount is reduced through the use of an allowance account. when a trade receivable is considered uncollectible, it is written off
against the allowance account. Subsequent recoveries of amounts previously written off are credited against the allowance account. changes in the
carrying amount of the allowance account are recognised in profit or loss.
If, in a subsequent period, the amount of the impairment loss decreases and the decrease can be related objectively to an event occurring after
the impairment was recognised, the previously recognised impairment loss is reversed through profit or loss to the extent that the carrying amount
of the investment at the date the impairment is reversed does not exceed what the amortised cost would have been had the impairment not been
recognised.
CASh AND CASh EquIv ALENTS
cash and cash equivalents comprise cash on hand and demand deposits, and other short-term highly liquid investments that are readily
convertible to a known amount of cash within three months and are subject to an insignificant risk of changes in value.
DERECOGNITION OF FINANCIAL ASSETS
The group derecognises a financial asset only when the contractual rights to the cash flows from the asset expire; or it transfers the financial
asset and substantially all the risks and rewards of ownership of the asset to another entity. If the group neither transfers nor retains substantially
all the risks and rewards of ownership and continues to control the transferred asset, the group recognises its retained interest in the asset and
an associated liability for amounts it may have to pay. If the group retains substantially all the risks and rewards of ownership of a transferred
financial asset, the group continues to recognise the financial asset and also recognises a collateralised borrowing for the proceeds received.
FINANCIAL LIABILITIES AND EquITy
financial liabilities and equity instruments are classified according to the substance of the contractual arrangements entered into. An equity
instrument is any contract that evidences a residual interest in the assets of the group after deducting all of its liabilities. Equity instruments issued
by the group are recorded at the proceeds received, net of direct issue costs.
financial liabilities are classified as at fvTPL where the financial liability is either held for trading or it is designated as at fvTPL. The group does
not have any designated fvTPL liabilities.
A financial liability is classified as held for trading if:
• it has been incurred principally for the purpose of disposal in the near future; or
• it is a part of an identified portfolio of financial instruments that the group manages together and has a recent actual pattern of short-
term profit taking; or
• it is a derivative that is not designated and effective as a hedging instrument.
financial liabilities at fvTPL are stated at fair value, with any resultant gain or loss recognised in profit or loss.
OThER FINANCIAL LIABILITIES
Other financial liabilities, including borrowings, are initially measured at fair value, net of transaction costs. Other financial liabilities are
subsequently measured at amortised cost using the effective interest method, with interest expense recognised on an effective yield basis. The
effective interest method is a method of calculating the amortised cost of a financial liability and of allocating interest expense over the relevant
period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial liability,
or, where appropriate, a shorter period, to the net carrying amount on initial recognition.
DERECOGNITION OF FINANCIAL LIABILITIES
The group derecognises financial liabilities when, and only when, the group’s obligations are discharged, cancelled or they expire.
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DERIv ATIvE FINANCIAL INSTRuMENTS
The group’s activities expose it to the financial risks of changes in foreign currency exchange rates and interest rates.
The group uses foreign exchange forward contracts to manage its foreign currency risk. The group does not hold or issue derivative financial
instruments for speculative purposes.
The use of financial derivatives is governed by the group’s policies approved by the board of directors, on the use of financial derivatives.
derivatives are initially recognised at fair value at the date a derivative contract is entered into and are subsequently re-measured to their fair
value at each period end date. The resulting gain or loss is recognised in profit or loss immediately.
A derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the instrument is more than 12 months and it is
not expected to be realised or settled within 12 months. Other derivatives are presented as current assets or current liabilities.
derivatives embedded in other financial instruments or other host contracts are treated as separate derivatives when their risks and characteristics
are not closely related to those of the host contracts and the host contracts are not measured at fair value with changes in fair value recognised in
profit or loss.
An embedded derivative is presented as a non-current asset or a non-current liability if the remaining maturity of the hybrid instrument to which
the embedded derivative relates is more than 12 months and is not expected to be realised or settled within 12 months. Other derivatives are
presented as current assets or current liabilities.
R) ShARE-BASED PA yMENTS
The group has applied the requirements of IfRS 2 Share-based Payments. In accordance with the transitional provisions, IfRS 2 has been applied
to all grants of equity instruments after 7 november 2002 that were unvested as of 1 October 2005.
The group issues equity settled share based payments to certain employees. Equity settled share based payments are measured at fair value
(excluding the effect of non market-based vesting conditions) at the date of grant. The fair value determined at the grant date of the share based
payment is expensed on a straight line basis over the vesting period, based on the group’s estimate of shares that will eventually vest. fair value
is measured by use of the black Scholes model.
The group provides employees with the ability to purchase the group’s ordinary shares at 80% of the current market value through the operation
of its share save scheme. The group records an expense, based on its estimate of the 20% discount related to shares expected to vest on a
straight line basis over the vesting period.
S) TRADE PA yABLES
Trade payables are initially measured at fair value and are subsequently measured at amortised cost, using the effective interest rate method.
T) OPERATING PROFIT
Operating profit is stated after charging restructuring costs but before property disposals, investment income, finance costs and fair value
movement in derivative contracts.
u) PROvISIONS
Provisions are recognised when the group has a present obligation (legal or constructive) as a result of a past event, and it is probable that the
group will be required to settle that obligation and a reliable estimate can be made of the amount of that obligation. Provisions are measured
at the directors’ best estimate of the expenditure required to settle the obligation at the balance sheet date, and are discounted to present value
where the effect is material.
v) SuPPLIER INCOME
Amounts receivable from suppliers are initially held on the balance sheet within the cost of inventory and recognised within the income statement
once the contractual terms of the supplier agreements are met and the corresponding inventory has been sold.
volume rebates and price discounts are recognised in the income statement, as a reduction in cost of sales, in line with the recognition of the sale
of a product.
w) CRITICAL ACCOuNTING juDGEMENTS AND kEy SOuRCES OF ESTIMATION uNCERTAINTy
In the application of the group’s accounting policies, which are described above, the directors are required to make judgements, estimates and
assumptions about the carrying amounts of assets and liabilities that are not readily apparent from other sources. The estimates and associated
assumptions are based on historical experience and other factors that are considered to be relevant. Actual results may differ from these estimates.
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in
which the estimate is revised if the revision affects only that period, or in the period of the revision and future periods if the revision affects both
current and future periods.
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cOnT In uEd
2 AccOunTIng POLIcI ES cOnT InuEd
The critical judgement, apart from those involving estimations (which are dealt with separately below), that the directors have made in the
process of applying the group’s accounting policies and that has the most significant effect on the amounts recognised in financial statements is
the detailed criteria for the recognition of revenue from the sale of goods set out in IAS 18 Revenue. In particular the largest judgement is where
there are open orders and these goods have not been delivered to the customer, and in these cases the directors believe the significant risks and
rewards of ownership of the goods have not been transferred to the buyer and therefore do not recognise revenue on these orders.
kEy SOuRCES OF ESTIMATION uNCERTAINTy
The key assumptions concerning the future, and other key sources of estimation uncertainty at the period end date, that have a significant risk of
causing a material adjustment to the carrying amounts of assets and liabilities within the next financial period, are discussed below:
INvENTOR y
At the period end there were £1.9 million (2014: £2.2 million) of overheads and £2.0 million (2014: £2.1 million) of supplier income (rebates)
absorbed into the inventory balance. Additionally there were £0.7 million (2014: £0.6 million) of provisions against the net realisable value of
inventories.
PROPERTy PROvISIONS
ONEROuS LEASE PROvISION
during the period the group has continued to review the performance of its store portfolio, which has resulted in no further stores being exited
before their lease terms had expired (2014: two stores). In respect of the leases in relation to stores exited before lease end dates in prior periods
that are still vacant, the group has provided for what it considers to be the unavoidable costs prior to lease termination or sublease. The group
has further reviewed any trading loss making stores and provided for those leases considered to be onerous. These estimates are based upon
available information and knowledge of the property market. The ultimate costs to be incurred in this regard may vary from the estimates.
DILAPIDATIONS PROvISION
The group has estimated its likely dilapidation charges for its store portfolio and provided accordingly. This estimate involves an assessment of
average costs per store and the expected exit period for the current portfolio, and is based on management’s best estimate, taking into account
knowledge of the property market and historical trends. The ultimate costs to be incurred may vary from the estimates.
SuPPLIER INCOME
The group has arrangements with a number of its suppliers which award rebates on satisfaction of purchase thresholds or discounts against
certain inventory lines. At the period end, the group has invoiced £1.2 million of rebates (2014: £1.2 million) which are still outstanding
in receivables and holds £2.0 million (2014: £2.1 million) of rebates within the inventory balance (as above) and accrued rebates of £1.4
million (2014: £1.1 million). The group does not recognise the amounts received from suppliers within the income statement until the associated
inventories are sold to the customers of the group.
BuSINESS SIMPLIFICATION COSTS
during the period the group announced its intentions to relocate the finance function to its head office in Leicester, resulting in the closure of a
support office. Additionally a decision has been made to exit the Topps clearance format in order to focus on the core Topps Tiles brand. These
decisions have led to a review of the onerous lease and related property provisions and a number of redundancy announcements.
3 REvEnuE
An analysis of group revenue is as follows:
REvEnuE fROm ThE SALE Of gOOdS
fAIR vALuE gAIn On fORw ARd cuRREncy cOnTRAcTS
InvESTmEnT REvEnuE
TOTAL REvEnuE
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
212,221
195,237
135
107
110
141
212,463
195,488
Investment revenue represents bank interest receivable. There are no other gains recognised in respect of loans and receivables.
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during the period the group announced the decision to relocate the finance function to Leicester and exit the Topps clearance format in the
first half of 2015-16 financial period. This will result in the exit of one central support office and nine store locations. Accordingly the group
has provided for the expected exposure to future lease commitments on these properties, resulting in a charge of £1.7million. Addtionally, an
impairment review has been conducted of the property, plant and equipment held by these locations, resulting in a charge of £0.2million. The
group has also provided for other restructuring costs related to this decision, resulting in a charge of £0.7million.
incLUdEd in AdminiSTRATivE ExPEnSES:
ImPAIRmEnT Of PROPERTy, PLAnT And EquIPmEnT
RESTRucTuRIng cOSTS
PROPERTy RELATEd PROvISIOnS
5 PROfIT bEfORE TAxATIOn
Profit before taxation for the period has been arrived at after charging/(crediting):
dEPREcIATIOn Of PROPERTy, PLAnT And EquIPmEnT
ImPAIRmEnT Of PROPERTy, PLAnT And EquIPmEnT*
dISPOSAL Of PROPERTy, PLAnT And EquIPmEnT LOSS/(gAIn)
PROPERTy RELATEd PROvISIOnS chARgEd/(uTILISEd)*
RESTRucTuRIng cOSTS
STAff cOSTS (SEE nOTE 6)
OPERATIng LEASE REnTALS
wRITE dOwn Of InvEnTORIES REcOgnISEd AS An ExPEnSE
cOST Of InvEnTORIES REcOgnISEd AS ExPEnSE
nET fOREIgn ExchAngE gAIn
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
172
736
1,711
2,619
–
–
–
–
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
5,243
266
23
1,729
736
51,530
23,388
3,431
78,152
4,553
399
(401)
(7)
–
45,865
21,168
2,584
73,783
(135)
(268)
The disposal of property, plant and equipment loss relates to the sale of one freehold property (2014: one freehold property).
* Included in the amounts above for property related provisions and impairment of property, plant and equipment, are the business simplification costs in note 4.
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cOnT In uEd
5 PROfIT bEfORE TAxATIOn
cOnT InuEd
Analysis of auditor’s remuneration is provided below:
fEES PAyAbLE TO ThE cOmPAny’S AudITOR wITh RESPEcT TO ThE cOmPAny’S AnnuAL AccOunTS
fEES PA yAbLE TO ThE cOmPAny’S AudITOR And ThEIR ASSOcIATES fOR OThER AudIT
SERvIcES TO ThE gROuP:
AudIT Of ThE cOmPAny’S SubSIdIARIES PuRSuAnT TO LEgISLATIOn
TOTAL AudIT fEES
OThER ASSuRAncE
TAxATIOn cOmPLIAncE SERvIcES
REmunERATIOn cOmmITTEE AdvIcE
ShARE PLAn AdvIcE
TOTAL nOn AudIT fEES
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
30
30
85
115
10
70
2
11
93
85
115
10
70
13
–
93
208
208
A description of the work of the Audit committee is set out on page 46 and includes an explanation of how auditor objectivity and
independence is safeguarded when non-audit services are provided by the auditor.
6 STAff cOSTS
The average monthly number of persons and their full time equivalents employed by the group and company in the uk during the accounting
period (including executive directors) was:
SELLIng
AdmInISTRATIOn
ThEIR AggREgATE REmunERATIOn cOmPRISEd:
wAgES And SALARIES (IncLudIng LTIP, SEE nOTE 28)
SOcIAL SEcuRITy cOSTS
OThER PEnSIOn cOSTS (SEE nOTE 27b)
53 WEEKS
EndEd
3 ocTobER
2015
nUmbER
EmPLoyEd
52 WEEKS
EndEd
27 SEPTEmbER
2014
nUmbER
EmPLoyEd
1,731
184
1,915
1,619
175
1,794
46,844
41,577
3,838
848
3,636
652
51,530
45,865
details of directors’ emoluments are disclosed on pages 48 to 65. The group considers key management to be the directors only. Employee
profit sharing of £10.4 million (2014: £9.8 million) is included in the above and comprises sales commission and bonuses.
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7 InvESTmEnT REvEnuE, fInAncE cOSTS And f
AI R vALuE LO SS On InT ERE ST R AT E dER Iv
ATIvES
invESTmEnT REvEnUE
bAnk InTEREST REcEIv AbLE And SImILAR IncOmE
fAIR vALuE gAIn On fORw ARd cuRREncy cOnTRAcTS
finAncE coSTS
InTEREST On bAnk LOAnS And OvERdRAfTS
InTEREST On undERPAId TAx*
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
107
135
242
(1,231)
(852)
(2,083)
141
110
251
(2,042)
(105)
(2,147)
* The group has historically provided for tax on open hmRc enquiries, some of which have now been resolved. As a result, some historic tax payments have
been reallocated between periods which, whilst leading to a net reduction in the overall level of provision required, has required a reallocation of provision from
corporation tax payable to cover interest which may become due on underpaid tax in earlier periods. In the event that additional tax is ultimately due in those
earlier periods, it is estimated that £2.0 million of late payment interest would fall due, of which £1.1 million was provided for in the prior period. In addition the
group made a payment on account of £0.8 million in the period, in partial settlement of these open enquires.
hELd foR TRAdinG ASSETS And LiAbiLiTiES
fORwARd cuRREncy cOnTRAcTS gAInS
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
135
135
110
110
no finance costs are appropriate to be capitalised in the period, or the prior period.
Interest on bank loans and overdrafts represents gains and losses on financial liabilities measured at amortised cost. There are no other gains or
losses recognised in respect of financial liabilities measured at amortised cost.
8 TAxATIOn
conTinUinG oPERATionS:
cuRREnT TAx — chARgE fOR ThE PERIOd
cuRREnT TAx — AdjuSTmEnT In RESPEcT Of PREvIOuS PERIOdS
dEfERREd TAx — EffEcT Of REducTIOn In uk cORPORATIOn TAx RATE
dEfERREd TAx — chARgE fOR PERIOd (nOTE 19)
dEfERREd TAx — AdjuSTmEnT In RESPEcT Of PREvIOuS PERIOdS (nOTE 19)
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
3,946
4,087
103
–
(158)
63
(57)
(81)
133
97
3,954
4,179
corporation tax in the uk is calculated at 20.5% (2014: 22%) of the estimated assessable profit for the period.
The government has announced that it intends to reduce the rate of corporation tax to 19% with effect from 1 April 2017 and 18% from 1 April
2020. As this legislation was not substantively enacted by 3 October 2015, the impact of the anticipated rate change is not reflected in the tax
provisions reported in these accounts.
85
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cOnT In uEd
8 TAxATIOn cOnTInuEd
The charge for the period can be reconciled to the profit per the statement of financial performance as follows:
conTinUinG oPERATionS:
PROfIT bEfORE TAxATIOn
TAx AT ThE uk cORPORATIOn TAx RATE Of 20.5% (2014: 22%)
TAx EffEcT Of ExPEnSES ThAT ARE nOT dEducTIbLE In dETERmInIng TAxAbLE PROfIT
TAx EffEcT Of REducTIOn In uk cORPORATIOn TAx RATE
TAx EffEcT Of chARgEAbLE gAIn LOwER ThAn PROfIT On SALE Of fREEhOLd PROPERTy
TAx EffEcT Of TAngIbLE fIxEd ASSETS whIch dO nOT quALIfy fOR cAPITAL ALLOw
AncES
TAx EffEcT Of AdjuSTmEnT In RESPEcT Of PRIOR PERIOdS
TAx ExPEnSE fOR ThE PERIOd
9 dIvIdEndS
InTERIm dIvIdEnd fOR ThE PERIOd EndEd 3 OcTObER 2015 Of £0.0075
(2014: £0.0065) PER ShARE
PROPOSEd fInAL dIvIdEnd fOR ThE PERIOd EndEd 3 OcTObER 2015 Of
£0.0225 (2014: £0.0160) PER ShARE
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
17,019
3,489
119
–
(2)
182
166
16,691
3,672
367
(81)
(21)
201
41
3,954
4,179
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
1,447
1,257
4,358
3,098
The proposed final dividend is subject to approval by shareholders at the Annual general meeting and has not been included as a liability in
these financial statements.
10 EARnIngS PER ShARE
The calculation of earnings per share is based on the earnings for the financial period attributable to equity shareholders and the weighted
average number of ordinary shares.
wEIghTEd A vERAgE numbER Of ShARES
fOR bASIc EARnIngS PER ShARE
ImPAcT Of TREASuR y ShARES
wEIghTEd A vERAgE numbER Of ShARES undER OPTIOn
fOR dILuTEd EARnIngS PER ShARE
2015
nUmbER of
ShARES
2014
nUmbER of
ShARES
193,683,323 192,850,860
(799,088)
–
1,234,227
1,690,097
194,118,462 194,540,957
The calculation of the basic and diluted earnings per share used the denominators as shown above for both basic and diluted earnings
per share.
86
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www.toppstiles.co.uk Stock code: TPTfinancial statements 11 gOOdwILL
cOST And cARR yIng AmOunT AT 28 SEPTEmbER 2013, 27 SEPTEmbER 2014
And 3 OcTObER 2015
£’000
245
The balance of goodwill remaining is the carrying value that arose on the acquisition of Surface coatings Ltd in 1998.
The group tests goodwill annually for impairment, or more frequently if there are indications that goodwill might be impaired.
The recoverable amounts are determined from value in use calculations. The key assumptions for the value in use calculations are those regarding
the discount rates, growth rates and expected changes to, selling prices and direct costs during the period. management estimates discount rates
based on the group’s weighted average cost of capital. The growth rates are based on industry growth forecasts. changes in selling prices and
direct costs are based on past practices and expectations of future changes in the market. discounted cash flows are calculated using a post-tax
rate of 12.0% (2014: 12.0%).
The group prepares cash flow forecasts derived from the most recent financial budgets approved by management for the next five years and
extrapolates cash flows for the following five years. The growth rate applied does not exceed the average long-term growth rate for the relevant
markets. There are no reasonable changes that would result in the carrying value of goodwill being reduced to its recoverable amount.
As a result of the annual test of impairment of goodwill, no impairment has been identified for the current period.
12 PROPERTy, PLAnT And EquIPmEnT
coST
AT 28 SEPTEmbER 2013
AddITIOnS
dISPOSALS
AT 27 SEPTEmbER 2014
AddITIOnS
dISPOSALS
AT 3 ocTobER 2015
AccUmULATEd dEPREciATion And imPAiRmEnT
AT 28 SEPTEmbER 2013
chARgE fOR ThE PERIOd
PROvISIOn fOR ImPAIRmEnT
ELImInATEd On dISPOSALS
AT 27 SEPTEmbER 2014
chARgE fOR ThE PERIOd
PROvISIOn fOR ImPAIRmEnT
ELImInATEd On dISPOSALS
AT 3 ocTobER 2015
cARRyinG AmoUnT
AT 3 ocTobER 2015
AT 27 SEPTEmbER 2014
LAnd And bUiLdinGS
fREEhoLd
£’000
ShoRT
LEASEhoLd
£’000
15,360
2,872
(281)
17,951
1,129
(520)
18,560
1,842
–
(10)
1,832
231
(109)
1,954
fixTURES
And
fiTTinGS
£’000
56,350
8,345
(1,236)
63,459
10,643
(1,793)
72,309
1,619
1,678
35,009
242
–
(94)
51
–
(10)
1,767
1,719
290
–
(11)
2,046
16,514
16,184
38
–
(109)
1,648
306
113
4,228
389
(1,115)
38,511
4,896
266
(1,627)
42,046
30,263
24,948
moToR
vEhicLES
£’000
166
15
(61)
120
5
(67)
58
64
32
10
(35)
71
19
–
(43)
47
11
49
ToTAL
£’000
73,718
11,232
(1,588)
83,362
12,007
(2,488)
92,881
38,370
4,553
399
(1,254)
42,068
5,243
266
(1,790)
45,787
47,094
41,294
freehold land and buildings include £4,104,000 of freehold land (2014: £4,104,000) on which no depreciation has been charged in the
current period. There is no material difference between the carrying and market values.
cumulative finance costs capitalised in the cost of tangible fixed assets amount to £nil (2014: £nil).
contractual commitments for the acquisition of property, plant and equipment are detailed in note 27.
during the period, the group has closed nine stores in the uk. As the fixtures and fittings within these stores cannot be re-used in other locations
within the group, the carrying value of these assets has been fully provided for in the period, with the associated impairment charge of
£266,000 (2014: £389,000) included within other operating expenses.
87
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cOnT In uEd
13 SubSIdIARIES
A list of all subsidiaries, including the name, country of incorporation and proportion of ownership interest is given in note 3 to the company’s
separate financial statements.
14 TRAdE And OThER REcEIv
AbLES
AmoUnTS f ALLinG dUE WiThin onE yEAR:
AmOunTS REcEIv AbLE fOR ThE SALE Of gOOdS
ALLOw AncE fOR dOubTfuL dEbTS
OThER dEbTORS And PREPA ymEnTS
— REnT And RATES
— OThER
2015
£’000
712
(27)
4,808
2,548
8,041
2014
£’000
740
(45)
3,324
1,781
5,800
The directors consider that the carrying amount of trade and other receivables at 3 October 2015 and 27 September 2014 approximates to
their fair value on the basis of discounted cash flow analysis.
CREDIT RISk
The group’s principal financial assets are bank balances and cash and trade receivables.
The group considers that it has no significant concentration of credit risk. The majority of sales in the business are cash based sales in the stores.
Total trade receivables (net of allowances) held by the group at 3 October 2015 amounted to £0.7 million (2014: £0.7 million). These
amounts mainly relate to sundry trade accounts and Tesco clubcard Scheme generated sales. In relation to these sales, the average credit period
taken is 51 days (2014: 61 days) and no interest is charged on the receivables. Trade receivables between aged over 60 days are provided
for based on estimated irrecoverable amounts from the sale of goods, determined by reference to past default experience.
before accepting any new customer, the group uses an external credit scoring system to assess the potential customer’s credit quality and defines
credit limits by customer. Limits and scoring attributed to customers are reviewed periodically. Of the trade receivables balance at the end of the
year, £146,000 (2014: £120,000) is due from Tesco Plc, the group’s largest customer.
Included in the group’s trade receivable balance are debtors with a carrying amount of £96,000 (2014: £42,000) which are past due at
the reporting date for which the group has not provided as there has not been a significant change in credit quality and the amounts are still
considered recoverable. The group does not hold any collateral over these balances.
Ageing of past due but not impaired receivables
gREATER ThAn 60 dA yS
2015
£’000
96
2014
£’000
42
The allowance for doubtful debts was £27,000 by the end of the period (2014: £45,000). given the minimal receivable balance, the directors
believe that there is no further credit provision required in excess of the allowance for doubtful debts.
The allowance for doubtful debts includes £27,000 relating to individually impaired trade receivables (2014: £45,000) which are due from
companies that have been placed into liquidation.
The directors consider that the carrying amount of trade and other receivables is approximately equal to their fair value.
88
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www.toppstiles.co.uk Stock code: TPTfinancial statements 15 cASh And cASh EquIv ALEnTS
cash and cash equivalents comprise cash held by the group and short term bank deposits (with associated right of set off) net of bank overdrafts,
with an original maturity of three months or less. The carrying amount of these assets approximates their fair value. A breakdown of significant
bank and cash balances by currency is as follows:
STERLIng
uS dOLLAR
EuRO
TOTAL cASh And cASh EquIv ALEnTS
16 OThER fInAncI AL LIAbI LI TIES
TRADE AND OThER PA yABLES
AmoUnTS f ALLinG dUE WiThin onE yEAR
TRAdE PA yAbLES
OThER PA yAbLES
AccRuALS And dEfERREd IncOmE
2015
£’000
2014
£’000
16,519
19,367
14
31
31
149
16,564
19,547
2015
£’000
2014
£’000
15,505
4,940
14,041
34,486
18,193
5,841
12,206
36,240
Trade payables and accruals principally comprise amounts outstanding for trade purchases and on-going costs. The average credit period taken
for trade purchases is 46 days (2014: 58 days). no interest is charged on these payables.
The directors consider that the carrying amount of trade payables at 3 October 2015 and 27 September 2014 approximates to their fair value
on the basis of discounted cash flow analysis.
17 bAnk LOAnS
bAnk LOAnS (ALL STERLIng)
ThE bORROwIngS ARE REPA yAbLE AS fOLLOwS:
On dEmAnd OR wIThIn OnE yEAR
In ThE SEcOnd yEAR
In ThE ThIRd TO fIfTh yEAR
LESS: TOTAL unAmORTISEd ISSuE cOSTS
ISSuE cOSTS TO bE AmORTISEd wIThIn 12 mOnThS
AmOunT duE fOR SETTLEmEnT AfTER 12 mOnThS
2015
£’000
2014
£’000
44,576
49,467
2015
£’000
2014
£’000
–
–
45,000
45,000
(424)
–
–
50,000
50,000
(533)
44,576
49,467
116
114
44,692
49,581
The directors consider that the carrying amount of the bank loan at 3 October 2015 and 27 September 2014 approximates to its fair value
since the amounts relate to floating rate debt.
89
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Notes TO ThE fInAncIAL STATEmEnTS
cOnT In uEd
17 bAnk LOAnS cOnTInuEd
The average weighted interest rates paid on the loan were as follows:
LOAnS
2015
%
2.36
2014
%
3.05
The group borrowings are arranged at floating rates, thus exposing the group to cash flow interest rate risk.
during the previous period the group agreed a new five year revolving credit facility of £50.0 million, expiring 1 june 2019. As at the financial
period end £45.0 million of this facility was drawn (2014: £50.0 million). The loan facility contains financial covenants which are tested on a
bi-annual basis.
At 3 October 2015, the group had available £5.0 million (2014: £nil) of undrawn committed banking facilities.
18 fInAncIAL InSTRumEnTS
financial liabilities held for trading were reclassified in the prior period in order to more appropriately reflect the requirements of IAS1.
classification as non-current liabilities ensures the instrument mirrors the cash flows of the loan facility, which it is in place to hedge against.
CAPITAL RISk MANAGEMENT
The group manages its capital to ensure that entities in the group will be able to continue as a going concern while maximising the return to
stakeholders through the optimisation of the debt and equity balance. The group’s overall strategy remains unchanged from 2014. The capital
structure of the group consists of debt, which includes the borrowings disclosed in note 17, cash and cash equivalents disclosed in note 15 and
equity attributable to equity holders of the parent, comprising issued capital, reserves and retained earnings as disclosed in notes 20 to 26.
The group is not subject to any externally imposed capital requirements.
SIGNIFICANT ACCOuNTING POLICIES
details of the significant accounting policies and methods adopted, including the criteria for recognition, the basis of measurement and the basis
on which income and expenses are recognised, in respect of each class of financial asset, financial liability and equity instrument are disclosed
in note 2q to the financial statements.
categories of financial instruments:
cARRyinG vALUE And
fAiR vALUE
2015
£’000
2014
£’000
finAnciAL ASSETS
LOAnS And REcEIv AbLES (IncLudIng cASh And cASh EquIv
ALEnTS)
17,249
20,242
fAIR vALuE ThROugh PROfIT And LOSS
finAnciAL LiAbiLiTiES
fAIR vALuE ThROugh PROfIT And LOSS
AmORTISEd cOST
117
–
–
18
60,197
66,579
The group considers itself to be exposed to risks on financial instruments, including market risk (including currency risk), credit risk, liquidity risk
and cash flow interest rate risk.
The group seeks to mitigate the effects of these risks by using derivative financial instruments to hedge these risk exposures economically. The
use of financial derivatives is governed by the group’s policies approved by the board of directors, which provide written principles on foreign
exchange risk, interest rate risk, credit risk, the use of financial derivatives and non-derivative financial instruments, and the investment of excess
liquidity. The group does not enter into or trade financial instruments, including derivative financial instruments, for speculative purposes.
MARkET RISk
The group’s activities expose it primarily to the financial risks of changes in foreign currency exchange rates and interest rates. The group enters
into forward foreign exchange contracts to hedge the exchange rate risk arising on the import of goods.
90
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www.toppstiles.co.uk Stock code: TPTfinancial statements 18 fInAncIAL InSTRumEnTS
cOnTInuEd
FOREIGN CuRRENCy RISk MANAGEMENT
The group undertakes certain transactions denominated in foreign currencies. hence, exposures to exchange rate fluctuations arise. Exchange
rate exposures are managed within approved policy parameters utilising forward foreign exchange contracts.
The carrying amounts of the group’s foreign currency denominated monetary assets and monetary liabilities at the reporting date are as follows:
EuRO
uS dOLLAR
ASSETS
LiAbiLiTiES
2015
£’000
31
14
2014
£’000
149
31
2015
£’000
2,201
500
2014
£’000
1,502
792
FOREIGN CuRRENCy SENSITIvITy ANAL ySIS
The group is mainly exposed to the currency of china and brazil (uS dollar currency) and to various European countries (Euro) as a result of
inventory purchases. The following table details the group’s sensitivity to a 10% increase and decrease in Sterling against the relevant foreign
currencies. 10% represents management’s assessment of the reasonably possible change in foreign exchange rates. The sensitivity analysis includes
only outstanding foreign currency denominated monetary items and adjusts their translation at the period end for a 10% change in foreign currency
rates. A positive number below indicates an increase in profit and other equity where Sterling strengthens 10% against the relevant currency.
PROfIT OR LOSS mOvEmEnT On A 10% STREngThEnIng In STERLIng AgAInST ThE EuRO
PROfIT OR LOSS mOvEmEnT On A 10% STREngThEnIng In STERLIng AgAInST ThE uS dOLLAR
PROfIT OR LOSS mOvEmEnT On A 10% wEAkEnIng In STERLIng AgAInST ThE EuRO
PROfIT OR LOSS mOvEmEnT On A 10% wEAkEnIng In STERLIng AgAInST ThE uS dOLLAR
CuRRENCy DERIv ATIvES
2015
£’000
197
44
(241)
(54)
2014
£’000
123
69
(150)
(85)
The group utilises currency derivatives to hedge significant future transactions and cash flows. The group uses foreign currency forward contracts
in the management of its exchange rate exposures. The contracts are denominated in uS dollars and Euros.
At the balance sheet date, the total notional amounts of outstanding forward foreign exchange contracts that the group has committed to are
as below:
fORwARd fOREIgn ExchAngE cOnTRAcTS
2015
£’000
6,597
2014
£’000
5,766
These arrangements are designed to address significant exchange exposures for the first half of 2015 and are renewed on a revolving basis as
required.
At 3 October 2015 the fair value of the group’s currency derivatives is a £117,000 gain within prepayments (note 14) (2014: a liability
of £18,000 held in accruals and deferred income). These amounts are based on the market value of equivalent instruments at the balance
sheet date.
gains of £135,000 are included in finance costs (note 7) (2014: £110,000 gain).
INTEREST RATE RISk MANAGEMENT
The group is exposed to interest rate risk as entities in the group borrow funds at floating interest rates. due to the reduced level of floating rate
borrowings and the current low level of interest rates, management have not deemed it necessary to implement measures that would mitigate
this risk. The group’s exposures to interest rates on financial assets and financial liabilities are detailed in the liquidity risk management section of
this note.
91
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cOnT In uEd
18 fInAncIAL InSTRumEnTS
INTEREST RATE SENSITIvITy ANAL ySIS
cOnTInuEd
The sensitivity analyses below have been determined based on the exposure to interest rates for both derivatives and non-derivative instruments at
the balance sheet date. for floating rate liabilities, the analysis is prepared assuming the amount of liability outstanding at the balance sheet date
was outstanding for the whole year. A 50 basis points increase or decrease is used when reporting interest rate risk internally to key management
personnel and represents management’s assessment of the possible change in interest rates.
If interest rates had been 50 basis points higher/lower and all other variables were held constant, the group’s profit would be impacted as
follows:
(LOSS) OR PROfIT
The group’s sensitivity to interest rates mainly relates to the revolving credit facility.
CREDIT RISk MANAGEMENT
50 bASiS PoinTS
incREASE
in inTEREST RATES
2015
£’000
(184)
2014
£’000
(195)
50 bASiS PoinTS
dEcREASE
in inTEREST RATES
2015
£’000
184
2014
£’000
195
credit risk refers to the risk that a counter party will default on its contractual obligations resulting in financial loss to the group. management has
considered the counterparty risk associated with the cash and derivative balances and do not consider there to be a material risk. The group has
a policy of only dealing with creditworthy counterparties. The group’s exposure to its counterparties is reviewed periodically. Trade receivables
are minimal consisting of a number of insurance companies and sundry trade accounts, further information is provided in note 14.
The carrying amount of financial assets recorded in the financial statements, which is net of impairment losses, represents the group’s maximum
exposure to credit risk without taking account of the value of any collateral obtained
LIquIDITy RISk MANAGEMENT
ultimate responsibility for liquidity risk management rests with the board of directors. The group manages liquidity risk by maintaining adequate
reserves, banking facilities and borrowing facilities by continuously monitoring forecast and actual cash flows and matching the maturity profiles
of financial assets and liabilities.
LIquIDITy AND INTEREST RISk TABLES
The following tables detail the group’s remaining contractual maturity for its non-derivative financial liabilities. The tables have been drawn
up based on the undiscounted cash flows (and on the assumption that the variable interest rate remains constant at the latest fixing level of
2.28688% (2014: 2.45694%)) of financial liabilities based on the earliest date on which the group can be required to pay. The table includes
both interest and principal cash flows.
2015
nOn-InTEREST bEARIng
vARIAbLE InTEREST RATE InSTRumEnTS
2014
nOn-InTEREST bEARIng
vARIAbLE InTEREST RATE InSTRumEnTS
LESS ThAn
1 monTh
£’000
20,444
78
LESS ThAn
1 monTh
£’000
24,034
95
1–3 monThS
£’000
3 monThS To
1 yEAR
£’000
–
186
–
792
1–3 monThS
£’000
3 monThS To
1 yEAR
£’000
–
5,199
–
882
1–5 yEARS
£’000
–
47,823
1–5 yEARS
£’000
–
49,210
ToTAL
£’000
20,444
48,879
ToTAL
£’000
24,034
55,386
The group is financed through a £50 million (2014 £50 million), revolving credit facility of which £45 million (2014 £50 million) was utilised.
At the balance sheet date the total unused amount of financing facilities was £5 million (2014 £nil). The group expects to meet its other
obligations from operating cash flows and proceeds of maturing financial assets.
The following table details the group’s liquidity analysis for its derivative financial instruments. The table has been drawn up based on the
undiscounted net cash inflows/(outflows) on the derivative instruments that settle on a net basis and the undiscounted gross inflows and
(outflows) on those derivatives that require gross settlement. when the amount payable or receivable is not fixed, the amount disclosed has been
determined by reference to the projected interest and foreign currency rates as illustrated by the yield curves existing at the reporting date.
92
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cOnTInuEd
2015
fOREIgn ExchAngE fORw ARd
cOnTRAcTS PA ymEnTS
fOREIgn ExchAngE fORw ARd
cOnTRAcTS REcEIPTS
2014
fOREIgn ExchAngE fORw ARd
cOnTRAcTS PA ymEnTS
fOREIgn ExchAngE fORw ARd
cOnTRAcTS REcEIPTS
LESS ThAn
1 monTh
£’000
1–3 monThS
£’000
3 monThS To
1 yEAR
£’000
1–5 yEARS
£’000
5+ yEARS
£’000
–
–
(3,331)
(3,267)
3,358
3,362
–
–
–
–
LESS ThAn
1 monTh
£’000
1–3 monThS
£’000
3 monThS To
1 yEAR
£’000
1–5 yEARS
£’000
5+ yEARS
£’000
–
–
(2,903)
(2,864)
2,884
2,888
–
–
–
–
ToTAL
£’000
(6,598)
6,720
ToTAL
£’000
(5,767)
5,772
FAIR vALuE OF FINANCIAL INSTRuMENTS
The fair values of financial assets and financial liabilities are determined as follows:
• foreign currency forward contracts are measured using quoted forward exchange rates and yield curves derived from quoted interest
rates matching maturities of the contracts.
• The fair values are therefore categorised as Level 2 (2014: Level 2), based on the degree to which the fair value is observable. Level
2 fair value measurements are those derived from inputs other than unadjusted quoted prices in active markets (level 1 categorisation)
that are observable for the asset or liability, either directly (i.e. as prices) or indirectly (i.e. derived from prices).
19 PROvISIOnS
OnEROuS LEASE PROvISIOn
buSInESS SImPLIfIcATIOn PROvISIOn
dILAPIdATIOnS PROvISIOn
cuRREnT
nOn-cuRREnT
AT 27 SEPTEmbER 2014
cREATEd In ThE yEAR
uTILISATIOn Of PROvISIOn
RELEASE Of PROvISIOn In ThE PERIOd
AT 3 ocTobER 2015
2015
£’000
1,368
2,208
1,569
5,145
1,736
3,409
5,145
bUSinESS
SimPLificATion
PRoviSion
£’000
onERoUS
LEASE
PRoviSion
£’000
diLAPidATionS
PRoviSion
£’000
–
2,208
–
–
1,493
1,426
754
(880)
–
322
(178)
–
2,208
1,367
1,570
2014
£’000
1,493
–
1,426
2,919
876
2,043
2,919
ToTAL
£’000
2,919
3,284
(1,058)
–
5,145
93
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cOnT In uEd
19 PROvISIOnS cOnTInuEd
The onerous lease provision relates to estimated future unavoidable lease costs in respect of closed, non-trading and loss making stores. The
provision is expected to be utilised over the following four financial periods. The dilapidations provision represents management’s best estimate
of the group’s liability under its property lease arrangements based on past experience and is expected to be utilised over the following six
financial periods. The business simplification provision relates to the decision to exit the Topps clearance format and relocation of the finance
function to Leicester, resulting in redundancies and the subsequent closure of nine store locations and one support office (see note 4). The
business simplification provision is expected to be utilised over the next 12 months. In addition to the provision £0.3 million of related costs have
been incurred and expensed in the period and £0.1 million is reflected in the value of inventories in the consolidated Statement of financial
Performance.
The following are the deferred tax liabilities/(assets) recognised by the group and movements thereon during the current and prior reporting
period.
AS AT 28 SEPTEmbER 2013
chARgE TO IncOmE
chARgE In RESPEcT Of PREvIOuS
PERIOdS
ImPAcT Of RATE chAngE
cREdIT TO EquITy
AS AT 27 SEPTEmbER 2014
chARgE/(cREdIT) TO IncOmE
chARgE In RESPEcT Of PREvIOuS
PERIOdS
cREdIT TO EquITy
AccELERATEd
TAx
dEPREciATion
£’000
1,573
26
74
(215)
–
1,458
2
63
–
AS AT 3 ocTobER 2015
1,523
oThER
ShoRT-TERm
TiminG
diffEREncES
£’000
(23)
–
23
–
–
–
–
–
–
–
ShARE-bASEd
PAymEnTS
£’000
(478)
80
–
50
(315)
(663)
(205)
–
(485)
(1,353)
ExchAnGE
RATE
diffEREncES
£’000
inTEREST
RATE
hEdGinG
£’000
(28)
22
–
4
–
(2)
24
–
–
22
(2)
2
–
–
–
–
–
–
–
–
REnT fREE
£’000
(616)
4
–
80
–
(532)
21
–
–
(511)
ToTAL
£’000
426
134
97
(81)
(315)
261
(158)
63
(485)
(319)
The government has announced that it intends to reduce the rate of corporation tax to 19% with effect from 1 April 2017 and 18% from 1 April
2020. As this legislation was not substantively enacted by 3 October 2015, the impact of the anticipated rate change is not reflected in the
tax provisions reported in these accounts. The effect of the future changes from 20% is expected to be to increase the net deferred tax asset by
£0.1million. To the extent that the deferred tax reverses more quickly/slowly than this the impact on the net deferred tax asset/liability will be
reduced/increased.
20 cALLEd-uP ShARE cAPITAL
AuThORISEd 240,000,000 (2014: 240,000,000) ORdInAR y ShARES Of 3.33P EAch (2014: 3.33P)
AuThORISEd 37,000,000 (2014: 37,000,000) REdEEmAbLE b ShARES Of £0.54 EAch
AuThORISEd 124,890,948 (2014: 124,890,948) IRREdEEmAbLE c ShARES Of £0.001 EAch
ISSuEd And fuLLy-PAId 193,700,459* (2014: 193,636,240*) ORdInARy ShARES Of 3.33P EAch (2014: 3.33P)
TOTAL
2015
£’000
8,000
2014
£’000
8,000
19,980
19,980
125
125
28,105
28,105
6,457
6,457
6,455
6,455
during the period the group issued 64,219 (2014: 1,508,571) ordinary shares with a nominal value of £2,141 (2014: £50,286) under
share option schemes for an aggregate cash consideration of £28,733 (2014: £438,111).
* during the period £504,000 (2014: £650,000) shares were purchased by Topps Tiles Employee benefit Trust on behalf of the group.
94
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www.toppstiles.co.uk Stock code: TPTfinancial statements
21 ShARE PREmIum
AT START Of PERIOd
PREmIum On ISSuE Of nEw ShARES
AT End Of PERIOd
22 Own ShARES
AT START Of PERIOd
AcquIREd In ThE PERIOd
dISPOSEd Of On ISSuE In ThE PERIOd
AT End Of PERIOd
2015
£’000
1,879
27
1,906
2015
£’000
(656)
(504)
530
(630)
2014
£’000
1,492
387
1,879
2014
£’000
(10)
(650)
4
(656)
A subsidiary of the group holds 799,000 (2014: 923,000) shares with a nominal value of £27,000 acquired for an average price of £0.79
per share (2014: £31,000 acquired for an average price of £0.71 per share) and therefore these have been classed as own shares.
23 mERgER RESERvE
AT START And End Of PERIOd
2015
£’000
(399)
2014
£’000
(399)
The merger reserve arose on pre 2006 acquisitions, the directors do not consider this to be distributable as at 3 October 2015 (2014: same).
24 ShARE-bASEd PA ymEnT RESERvE
AT START Of PERIOd
cREdIT TO EquITy fOR EquITy-SETTLEd ShARE bASEd PA
ymEnTS
AT End Of PERIOd
2015
£’000
1,941
879
2,820
2014
£’000
649
1,292
1,941
The share-based payment reserve has arisen on the fair valuation of save as you earn schemes and Long-term incentive plans. The directors do
not consider this to be distributable as at 3 October 2015 (2014: same).
25 cAPITAL REdEmPTI On RESERvE
AT START And End Of PERIOd
2015
£’000
2014
£’000
20,359
20,359
The capital redemption reserve arose on the cancellation of treasury shares and as a result of a share reorganisation in 2006. The directors do
not consider this to be distributable as at 3 October 2015 (2014: same).
95
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information Notes TO ThE fInAncIAL STATEmEnTS
cOnT In uEd
26 RETAInEd L OSSES
AT 28 SEPTEmbER 2013
dIvIdEndS (nOTE 8)
dEfERREd TAx On ShARESA vE SchEmE TAkEn dIREcTL
y TO EquITy
nET PROfIT fOR ThE PERIOd
AT 27 SEPTEmbER 2014
dIvIdEndS (nOTE 8)
dEfERREd And cuRREnT TAx On ShARESA vE SchEmE TAkEn dIREcTL
y TO EquITy
nET PROfIT fOR ThE PERIOd
AT 3 ocTobER 2015
27 fInAncIAL cOmmITmEnTS
A) CAPITAL COMMITMENTS
£’000
(38,679)
(3,175)
606
12,512
(28,736)
(4,534)
490
13,065
(19,715)
At the end of the period there were capital commitments contracted of £114,000 (2014: £164,000).
B) PENSION ARRANGEMENTS
The group operates a defined contribution pension scheme for employees. The assets of the schemes are held separately from those of the group
in independently administered funds. The pension cost charge represents contributions payable by the group to the funds and amounted to
£848,000 (2014: £652,000). At the period end there were no outstanding contributions (2014: same).
C) LEASE COMMITMENTS
minimum future sublease payments expected to be received under non-cancellable subleases amount to £3,093,000 (2014: 2,652,000).
The group has entered into non-cancellable operating leases in respect of motor vehicles, equipment and land and buildings.
minimum lease payments under operating leases recognised as an expense for the period were £23,388,000 (2014: £21,168,000) which
includes property service charges of £783,000 (2014: £767,000).
At the balance sheet date, the group had outstanding commitments for future minimum lease payments under non-cancellable operating leases
which fall due as follows:
— wIThIn 1 yEAR
— wIThIn 2 - 5 yEARS
— AfTER 5 yEARS
2015
2014
LAnd And
bUiLdinGS
£’000
21,868
69,785
54,619
oThER
£’000
847
797
–
LAnd And
bUiLdinGS
£’000
19,936
66,554
58,285
oThER
£’000
868
949
–
146,272
1,644
144,775
1,817
Operating lease payments primarily represent rentals payable by the group for certain of its office and store properties. Leases are negotiated for
an average term of 15 years and rentals are fixed for an average of 5 years (2014: 5).
96
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTfinancial statements 28 ShARE-bASEd PA ymEnTS
The group operates six share option schemes in relation to group employees.
ShARE-BASED PA yMENT PLANS
Employee share purchase plans are open to almost all employees and provide for a purchase price equal to the daily average market price
on the date of grant, less 20%. The shares can be purchased during a two-week period each financial period. The shares so purchased are
generally placed in the employee share savings plan for a 3 or 5 year period.
movements in share based payment plan options are summarised as follows:
2015
2014
OuTSTAndIng AT bEgInnIng Of PERIOd
ISSuEd duRIng ThE PERIOd
ExPIREd duRIng ThE PERIOd
ExERcISEd duRIng ThE PERIOd
OuTSTAndIng AT End Of PERIOd
ExERcISAbLE AT End Of PERIOd
nUmbER of
ShARE
oPTionS
2,485,176
887,775
(339,627)
(64,219)
2,969,105
–
WEiGhTEd
AvERAGE
ExERciSE
PRicE
£
0.37
0.98
0.31
0.29
0.63
–
The inputs to the black-Scholes model for the above 3 (2014: 3 and 5) year plans are as follows:
wEIghTEd A vERAgE ShARE PRIcE
— PEncE
wEIghTEd A vERAgE ExERcISE PRIcE
— PEncE
ExPEcTEd vOLATILITy
— %
ExPEcTEd LIfE
RISk-fREE RATE Of InTEREST
dIvIdEnd yIELd
— yEARS
— %
— %
nUmbER of
ShARE
oPTionS
3,352,424
910,851
(269,528)
(1,508,571)
2,485,176
–
2015
90.5
71.1
WEiGhTEd
AvERAGE
ExERciSE
PRicE
£
0.37
0.98
0.31
0.29
0.63
–
2014
79.0
63.2
42.2, 36.4
and 35.1
42.2 and
43.7
3
0.42
2.03
3 or 5
0.60
2.79
Expected volatility was determined by calculating the historical volatility of the group’s share price over the previous 3 years (2014: 3 or 5
years). The expected risk used in the model has been adjusted, based on management’s best estimate, for the effects of non-transferability,
exercise restrictions and behavioural forces.
DEFERRED BONuS LONG-TERM INCENTIvE PLAN
during the financial period ended 28 September 2013 an award was made under the deferred bonus long term incentive plan (LTIP) for the
Senior management Team. under this bonus scheme 25% of the award (net of tax) is deferred in the form of shares for a two year period, with
a matching share award (on a gross basis) that vests at the end of two years subject to the achievement of performance conditions relating to
continuing employment within the business and EbITdA earnings growth measured over the two year period.
This scheme was replaced in january 2013 when a new Long Term Incentive Plan was approved by shareholders and as such there will be no
further awards under this scheme.
The total number of shares awarded was nil (2014:191,084), and the fair value of these deferred shares as at 3 October 2015 was £nil
(2014: £88,000).
The total number of matching shares that are expected to be awarded, subject to fulfilment of the performance conditions is nil (2014: 363,614)
and the fair value of these matching shares as at 3 October 2015 was £nil (2014: £167,000). no options were granted or exercised during
the period (2014: none). There were no options outstanding at 3 October 2015 (2014: same).
97
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information Notes TO ThE fInAncIAL STATEmEnTS
cOnT In uEd
28 ShARE-bASEd PA ymEnTS cOnTInuEd
The inputs to the black–Scholes model are as follows:
wEIghTEd A vERAgE ShARE PRIcE
— PEncE
wEIghTEd A vERAgE ExERcISE PRIcE
— PEncE
ExPEcTEd vOLATILITy
ExPEcTEd LIfE
RISk-fREE RATE Of InTEREST
— %
— yEARS
— %
2015
–
–
–
–
–
2014
46.0
£nil
36.9
2
0.3
The scheme closed at the end of the prior period. In the prior period expected volatility was determined by calculating the historical volatility
of the group’s share price over the financial periods 2012/13 and 2013/14. The expected risk used in the model was adjusted, based on
management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural forces.
LONG TERM INCENTIvE PLAN
during the financial period, a new three year Long Term Incentive plan was approved by shareholders. under this plan a number of share options
were granted to senior management. These options will vest in november 2017 subject to the achievement of certain performance criteria.
The total number of share options granted was 1,422,348 (2014: nil) and the fair value of these options as at 3 October 2015 was
£1,439,000 (2014: £nil).
The inputs to the black–Scholes model are as follows:
wEIghTEd A vERAgE ShARE PRIcE
— PEncE
wEIghTEd A vERAgE ExERcISE PRIcE
— PEncE
ExPEcTEd vOLATILITy
ExPEcTEd LIfE
RISk-fREE RATE Of InTEREST
— %
— yEARS
— %
2015
106.0
£nil
35.1
3
0.5
2014
–
–
–
–
–
Expected volatility was determined by calculating the historical volatility of the group’s share price over the 2012/13, 2013/14 and 2014/15
financial periods. The expected risk used in the model has been adjusted, based on management’s best estimate, for the effects of non-
transferability, exercise restrictions and behavioural forces.
during the 2012/13 financial period, a three year Long Term Incentive plan was approved by shareholders. under this plan a number of share
options were granted to senior management. These options will vest in december 2015 subject to the achievement of certain performance
criteria.
The total number of share options granted was 2,073,474 (2014: 2,073,474) and the fair value of these options as at 3 October 2015 was
£929,000 (2014: £929,000).
The inputs to the black–Scholes model are as follows:
wEIghTEd A vERAgE ShARE PRIcE
— PEncE
wEIghTEd A vERAgE ExERcISE PRIcE
— PEncE
ExPEcTEd vOLATILITy
ExPEcTEd LIfE
RISk-fREE RATE Of InTEREST
— %
— yEARS
— %
2015
46.3
£nil
42.2
3
0.6
2014
46.3
£nil
42.2
3
0.6
Expected volatility was determined by calculating the historical volatility of the group’s share price over the 2011/12, 2012/13 and 2013/14
financial periods (2014: 2011/12, 2012/13 and 2013/14 financial period). The expected risk used in the model has been adjusted, based
on management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural forces.
during the previous financial period, a three year Long Term Incentive plan was approved by shareholders. under this plan a number of share
options were granted to senior management. These options will vest in december 2016 subject to the achievement of certain performance
criteria.
The total number of share options granted was 1,441,695 (2014: 1,532,730) and the fair value of these options as at 03 October 2015 was
£1,296,000 (2014: £1,351,000).
98
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTfinancial statements 28 ShARE-bASEd PA ymEnTS cOnTInuEd
The inputs to the black–Scholes model are as follows:
wEIghTEd A vERAgE ShARE PRIcE
— PEncE
wEIghTEd A vERAgE ExERcISE PRIcE
— PEncE
ExPEcTEd vOLATILITy
ExPEcTEd LIfE
RISk-fREE RATE Of InTEREST
— %
— yEARS
— %
2015
93.2
£nil
42.2
3
1.1
2014
93.2
£nil
42.2
3
1.2
Expected volatility was determined by calculating the historical volatility of the group’s share price over the 2011/12, 2012/13 and 2013/14
financial periods (2014: 2011/12, 2012/13 and 2013/14 financial periods). The expected risk used in the model has been adjusted,
based on management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural forces.
MANAGEMENT OPTIONS
during the 2012/13 financial period members of the management team were granted share options that are due to vest in October 2015,
subject to the fulfilment of criteria. The number of shares that are expected to be awarded is 260,000 (2014: 260,000) and the fair value of
these shares as at 3 October 2015 was £127,000 (2014: £127,000).
The inputs to the black–Scholes model are as follows:
wEIghTEd A vERAgE ShARE PRIcE
— PEncE
wEIghTEd A vERAgE ExERcISE PRIcE
— PEncE
ExPEcTEd vOLATILITy
ExPEcTEd LIfE
RISk-fREE RATE Of InTEREST
— %
— yEARS
— %
2015
46.3
£nil
42.2
3
0.56
2014
46.3
£nil
42.2
3
0.56
Expected volatility was determined by calculating the historical volatility of the group’s share price over the 2011/12, 2012/13 and 2013/14
financial periods. The expected risk used in the model has been adjusted, based on management’s best estimate, for the effects of non-
transferability, exercise restrictions and behavioural forces.
In total, the group recognised a total expense of £1,409,000 (2014: £1,292,000) relating to share based payments.
29 RELATEd PARTy TRAnSAcTI OnS
S.k.m. williams is a related party by virtue of his 9.99% shareholding (19,343,950 ordinary shares) in the group’s issued share capital (2014:
10.6% shareholding of 20,593,950 ordinary shares).
At 3 October 2015 S.k.m. williams was the landlord of four properties leased to multi Tile Limited, a trading subsidiary of Topps Tiles Plc, for
£240,000 (2014: three properties for £162,000) per annum.
no amounts were outstanding with S.k.m. williams at 3 October 2015 (2014: £nil).The lease agreements on all properties are operated on
commercial arm’s length terms
Transactions between the company and its subsidiaries, which are related parties, have been eliminated on consolidation and are not disclosed
in this note. In accordance with the exemption available under IAS24.
The remuneration of the board of directors, who are considered key management personnel of the group was £1.6 million (2014: £1.6 million)
including share based payments of £nil (2014: £193,000). further information about the remuneration of the individual directors is provided in
the Remuneration Report on pages 48 to 65.
99
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information Company bALAncE ShEE T
A S AT 3 OcT ObE R 2 0 1 5
fixEd ASSETS
InvESTmEnTS
cURREnT ASSETS
dEbTORS duE wIThIn OnE yEAR
dEbTORS duE AfTER OnE yEAR
cASh AT bAnk And In hAnd
cREdiToRS: AmOunTS f ALLIng duE wIThIn OnE yEAR
nET cURREnT ASSETS
nET ASSETS
cAPiTAL And RESER vES
cALLEd-uP ShARE cAPITAL
ShARE PREmIum
ShARE bASEd PA ymEnT RESERvE
cAPITAL REdEmPTIOn RESERvE
OThER RESERvE
PROfIT And LOSS AccOunT
EqUiTy ShAREhoLdERS’ fUndS
53 WEEKS
EndEd
3 ocTobER
2015
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
notes
3
4
4
5
6,7
7
7
7
7
7
493
3,059
10,554
20,840
15,179
46,573
(3,415)
43,158
43,651
6,457
1,906
3,354
20,359
6,200
5,375
43,651
5,306
123,200
18,689
147,195
(5,197)
141,998
145,057
6,455
1,879
1,945
20,359
6,200
108,219
145,057
The financial statements of Topps Tiles Plc, companies house number 3213782, were approved by the board of directors on
1 december 2015 and signed on its behalf by:
M T M Williams
R. Parker
directors
100
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTfinancial statements Notes TO ThE cOmPAny fInAncIAL
STATEmEnTS
1 bASIS Of AccOunTIng
The separate financial statements of the company are presented as required by the companies Act 2006. They have been prepared under the
historical cost convention and in accordance with united kingdom Accounting Standards and law.
based on a detailed review of the risks and uncertainties discussed within the Strategic and Operational Review, and management’s current
expectations the board believes that the company will continue to meet all of its financial commitments as they fall due and will be able to
continue as a going concern.
The current economic climate creates a degree of uncertainty in the outlook which when combined with the financial covenants included in
our loan facilities, has led the board to conduct a detailed review of a number of different trading scenarios, including reasonably possible
downsides, as well as possible mitigating actions, should they be required.
based on this analysis the board has concluded that the company would be able to fully meet all of its financial commitments for the foreseeable
future and therefore consider it appropriate to prepare the financial statements on the going concern basis.
There have been no changes to the principal accounting policies in the period, all of which have been applied consistently throughout the period
and the preceding period.
The company issues equity settled share based payments to certain employees. Equity settled share based payments are measured at fair value
at the date of grant.
fixed asset investments are shown at cost less provision for impairment.
The company has taken advantage of the exemption in fRS 8 from disclosing transactions with other members of the group and the exemption
in fRS 29 for making disclosures relating to financial instruments.
2 LOSS fOR ThE PERIOd
As permitted by section 408 of the companies Act 2006 the company has elected not to present its own profit and loss account for the period.
Topps Tiles Plc reported a loss for the financial period ended 3 October 2015 of £102,844,000 (2014: £611,000 profit), as a result of the
impairment of inter-company investments in Topps Tiles holdings Limited of £105,100,000 (2014: £nil).
The auditor’s remuneration for services to the company was £40,000 for audit related work (2014: £40,000 for audit related work). fees
relating to non-audit work totalled £nil (2014: £nil), see note 4 to the group financial statements for further details.
The company had no other employees other than the directors (2014: same), whose remuneration is detailed on page 57.
3 fIxEd ASSET In vES TmEnTS
AT 27 SEPTEmbER 2014
mOvEmEnT In ShARE OPTIOnS gRAnTEd TO EmPLOyEES
ImPAIRmEnT Of InvESTmEnT In TOPPS TILES hOLdIngS*
AT 3 ocTobER 2015
ShARES
£’000
3,059
179
(2,745)
493
* during the period the group undertook a corporate restructuring process, leading to the acquisition of Topps Tiles (uk) Limited by Tiles4Less Limited. following an
impairment review, the directors decided that the investment held by Topps Tiles Plc in the intermediary holding company of Topps Tiles (uk) Limited (Topps Tiles
holdings Limited) could not be supported. The subsequent impairment charge of £2,745,000 has been utilised against the non-distributable reserves held in the
company.
101
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information
Notes TO ThE cOmPAny fInAncIAL
STATEmEnTS
cOnT In uEd
3 fIxEd ASSET In vES TmEnTS
cOnTInuEd
The company has investments in the following subsidiaries which affected the profits or net assets of the group.
SUbSidiARy UndERTAKinG
TOPALPhA LImITEd*
AcRAmAn (318) LImITEd
AcRAmAn (319) LImITEd
TOPALPhA (ORPIngTOn) LImITEd
TOPALPhA (RhyL) LImITEd
% of iSSUEd
ShARES hELd
PRinciPAL AcTiviTy
100%
PROPERTy mAnAgEmEnT And InvESTmEnT
100%
dORmAnT
100%
dORmAnT
100%
dORmAnT
100%
dORmAnT
TOPALPhA (wAREhOuSE) LImITEd
100%
PROPERTy mAnAgEmEnT And InvESTmEnT And PROvISIOn Of
wAREhOuSIng SERvIcES
TOPALPhA (STOkE) LImITEd
100%
PROPERTy mAnAgEmEnT And InvESTmEnT
.
TILES4LESS LImITEd*
TOPPS TILES (uk) LImITEd
100%
InTERmEdIATE hOLdIng cOmPAny
100%
RETAIL And whOLESALE Of cERAmIc TILES, wOOd fLOORIng And
TOPPS TILES hOLdIngS LImITEd*
100%
InTERmEdIATE hOLdIng cOmPAny
TOPPS TILE kIngdOm LImITEd
100%
InTERmEdIATE hOLdIng cOmPAny
RELATEd PROducTS
muLTI TILE LImITEd
100%
RETAIL And whOLESALE Of cERAmIc TILES, wOOd fLOORIng And
RELATEd PROducTS
TOPPS TILES dISTRIbuTIOn L Td
100% whOLESALE And dISTRIbuTIOn Of cERAmIc TILES, wOOd fLOORIng And
RELATEd PROducTS.
muLTI-TILE dISTRIbuTIOn LImITEd
100%
InTERmEdIATE hOLdIng cOmPAny.
TOPPS TILES I.P cOmPAny LImITEd
100% OwnERShIP And mAnAgEmEnT Of gROuP InTELLEcTuAL PROPERTy.
cIRcuITcOuRT LImITEd
bEST4TILES LImITEd*
100%
dORmAnT
100%
dORmAnT
TOPPS TILES EmPLOyEE bEnEfIT TRuST*
100%
EmPLOyEE bEnEfIT TRuST
TOPPS TILES quEST TRuSTEE LImITEd*
100%
dORmAnT
* held directly by Topps Tiles Plc
The investments are represented by ordinary shares.
All undertakings are incorporated in great britain and are registered and operate in England and wales.
4 dEbTORS
AmOunTS f ALLIng duE wIThIn OnE yEAR:
AmOunTS OwEd by SubSIdIAR y undERTAkIngS
OThER dEbTORS
PREPAymEnTS And AccRuEd IncOmE
AmOunTS f ALLIng duE AfTER OnE yEAR:
AmOunTS OwEd by SubSIdIAR y undERTAkIng
2015
£’000
2014
£’000
10,035
5,253
3
516
36
17
10,554
5,306
20,840
123,200
An impairment review was conducted, following the corporate restructuring process detailed in note 3. This resulted in a decision by the directors
that the inter-co debtor held by the company with Topps Tiles holdings Limited could not be fully supported. The subsequent impairment charge of
£102,359,799 has been utilised against the non-distributable reserves held in the company.
102
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTfinancial statements
5 cREdITORS: AmOunTS f ALLIng duE wIThIn OnE yEA R
TRAdE And OThER cREdITORS
AmOunTS OwEd TO SubSIdIAR
y undERTAkIngS
AccRuALS And dEfERREd IncOmE
6 cALLEd-uP ShARE cAPI TAL
AuThORISEd 240,000,000 (2014: 240,000,000) ORdInAR y ShARES Of 3.33P EAch (2014: 3.33P)
AuThORISEd 37,000,000 (2014: 37,000,000) REdEEmAbLE b ShARES Of £0.54 EAch
AuThORISEd 124,890,948 (2014: 124,890,948) IRREdEEmAbLE c ShARES Of £0.001 EAch
ISSuEd And fuLL y-PAId 193,700,459 (2014: 193,636,240) ORdInAR y ShARES Of 3.33P EAch
(2014: 3.33P)
2015
£’000
560
222
2,633
3,415
2015
£’000
8,000
2014
£’000
17
2,796
2,384
5,197
2014
£’000
8,000
19,980
19,980
125
125
28,105
28,105
6,457
6,455
* during the period 431,108 (£504,000) shares were purchased by Topps Tiles Employee benefit Trust on behalf of the group (2014: 441,594 shares – £500,000).
during the period the group allotted 64,219 (2014: 1,508,571) ordinary shares with a nominal value of £2,141 (2014: £50,286) under
share option schemes for an aggregate cash consideration of £28,733 (2014: £438,111).
7 RESERvES
comPAny
AT 27 SEPTEmbER 2014
LOSS fOR ThE PERIOd
dIvIdEnd REcEIvEd fROm gROuP
cOmPAnIES
dIvIdEnd PAId TO EquITy
ShAREhOLdERS
wRITE dOwn Of InvESTmEnT
ISSuE Of nEw ShARES
cREdIT TO EquITy fOR EquITy-SETTLEd
ShARE bASEd PA ymEnTS
AT 3 ocTobER 2015
ShARE-
bASEd
PAymEnT
RESERvE
£’000
ShARE
PREmiUm
£’000
cAPiTAL
REdEmPTion
RESERvE
£’000
oThER
RESERvES
£’000
PRofiT
And LoSS
AccoUnT
£’000
ToTAL
£’000
1,879
1,945
20,359
6,200
108,219
145,057
ShARE
cAPiTAL
£’000
6,455
–
–
–
–
2
–
–
–
–
–
27
–
6,457
1,906
–
–
–
–
–
1,409
3,354
–
–
–
–
–
–
–
–
–
–
–
–
(203)
(203)
6,999
6,999
(4,535)
(4,535)
(105,105)
(105,105)
–
–
29
1,409
20,359
6,200
5,375
43,651
At 3 October 2015, the directors consider the other reserve of £6,200,000 to remain non distributable.
The directors consider £nil (2014: £105,106,000) of profit and loss account reserves not to be distributable at 3 October 2015. The prior
period amount arose on an unrealised gain on the intragroup disposal of subsidiary companies. An impairment has been recognised against the
related intercompany investment balance in the current period.
103
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information
Five yEAR REcORd
u nAu dI T Ed
comPAny
gROuP REvEnuE
gROuP OPERATIng PROfIT
PROfIT bEfORE TAxATIOn
ShAREhOLdERS’ fundS (dEfIcIT)
bASIc EARnIngS PER ShARE
dIvIdEnd PER ShARE
dIvIdEnd cOvER
AvERAgE numbER Of EmPLOyEES
ShARE PRIcE (PERIOd End)
52 WEEKS
EndEd
1 ocTobER
2011
£’000
52 WEEKS
EndEd
29 SEPTEmbER
2012
£’000
52 WEEKS
EndEd
28 SEPTEmbER
2013
£’000
52 WEEKS
EndEd
27 SEPTEmbER
2014
£’000
53 WEEKS
EndEd
3 ocTobER
2015
£’000
175,525
177,693
177,849
195,237
212,221
13,980
7,908
15,462
12,493
13,845
10,601
(25,462)
(17,348)
(10,184)
3.04p
1.50p
1.92
1,661
34.0p
5.14p
1.10p
4.68
1,654
46.0p
4.76p
1.25p
3.17
1,720
93.0p
18,186
16,691
843
6.49p
1.65p
3.94
1,794
18,883
17,019
10,798
6.75p
2.34p
2.88
1,915
105.0p
148.75p
All figures quoted are inclusive of continued and discontinued operations.
104
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www.toppstiles.co.uk Stock code: TPTfinancial statements OvE RvI Ew
ST R AT EgIc R E P O R T
gOvE RnAn cE
fInAn cI A L S TAT EmEnT S
Ad dI T I OnA L In fO RmAT I On
Additional
Information
C o n t e n t s
104 fIvE yEAR REcORd
105 nOTIcE Of AnnuAL gEnERAL mEETIng
110
ExPLAnATOR y nOTES TO ThE nOTIcE Of
AnnuAL gEnERAL mEETIng
113 ThE TEAm
122 STORE LOcATIOnS
Notice Of AnnuAL
gEnER AL mEETIng
nOtICe IS heReBy GIVen that the Annual general meeting of Topps Tiles
Plc (the “company”) will be held at the marriott hotel, Smith w ay, grove
Park, Enderby, Leicestershire LE19 1Sw on 28 january 2016 at 10.00 a.m.
for the following purposes:
ORdInAR y buSInESS
To consider and, if thought fit, pass the following resolutions 1–11 (inclusive)
which will be proposed as Ordinary Resolutions:
1. To receive and adopt the company’s Annual Report and financial
Statements for the financial period ended 3 October 2015 together
with the last directors’ Report, the last directors’ Remuneration Report
and the Auditors’ Report on those accounts and the auditable part of the
directors’ Remuneration Report.
2. To declare a final dividend of 2.25 pence per ordinary share for the
financial period ended 3 October 2015 payable on 4 february2016 to
shareholders who are on the register of members of the company on
8 january 2016.
3. To approve the directors’ Remuneration Report (other than the part
containing the directors’ Remuneration Policy) for the financial period
ended 3 October 2015 as set out on pages 48 to 65 of the company’s
Annual Report and financial Statements for that period.
4. To re-elect matthew williams as a director of the company.
5. To re-elect Robert Parker as a director of the company.
6. To re-elect darren Shapland as a director of the company.
7. To re-elect claire Tiney as a director of the company.
8. To re-elect Andy king as a director of the company.
9. To re-elect keith down as a director of the company
10. To re-appoint deloitte LLP as auditors of the company to hold office
from the conclusion of this Annual general meeting until the conclusion
of the next general meeting at which the Annual Report and financial
Statements are laid before the company
11. To authorise the directors to determine the remuneration of the auditors.
SP EcI AL buSInESS
To consider and, if thought fit, to pass the resolutions set out below which, in
the case of Resolution 12 will be proposed as an Ordinary Resolution and,
in the case of Resolutions 13 to 15 (inclusive), will be proposed as Special
Resolutions.
12. ThAT, in substitution for any equivalent authorities and powers granted to
the directors prior to the passing of this resolution, the directors be and
they are generally and unconditionally authorised pursuant to Section 551,
companies Act 2006 (the “Act”):
a. to exercise all powers of the company to allot shares in the company,
and grant rights to subscribe for or to convert any security into shares
of the company (such shares, and rights to subscribe for or to convert
any security into shares of the company being “relevant securities”) up
to an aggregate nominal amount of £2,152,317(such amount to be
reduced by the nominal amount of any allotments or grants made under
paragraph (b) below in excess of £2,152,317and further
105
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cOnT In uEd
b. to allot equity securities (as defined in Section 560 of the Act) up to an aggregate nominal amount of £4,304,634 (such amount to
be reduced by the nominal amount of any allotments or grants made under paragraph (a) above) in connection with an offer by way
of rights issue;
i.
in favour of holders of ordinary shares in the capital of the company, where the equity securities respectively attributable to
the interests of all such holders are proportionate (as nearly as practicable) to the respective number of ordinary shares in the
capital of the company held by them; and
ii.
to holders of any 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 directors may deem necessary or expedient to deal with treasury
shares, fractional entitlements or legal, regulatory or practical problems arising under the laws or requirements of any overseas
territory or by virtue of shares being represented by depository receipts or the requirements of any regulatory body or stock
exchange or any other matter whatsoever,
provided that, unless previously revoked, varied or extended, this authority shall expire on the earlier of the date falling 18 months
after the date of the passing of this resolution and the conclusion of the next Annual general meeting of the company, except that
the company may at any time before such expiry make an offer or agreement which would or might require relevant securities to be
allotted after such expiry and the directors may allot relevant securities in pursuance of such an offer or agreement as if this authority
had not expired.
13. ThAT, the directors be and they are empowered to allot equity securities (as defined in Section 560 of the Act) of the company
wholly for cash pursuant to the authority of the directors under Section 551 of the Act conferred by resolution 12 above (in
accordance with Section 570(1) of the Act) and/or by way of a sale of treasury shares (in accordance with Section 573 of
the Act), in each case as if Section 561(1) of the Act did not apply to such allotment provided that the power conferred by this
resolution shall be limited to:
a.
the allotment of equity securities in connection with an offer of, or invitation to apply for, equity securities (but in the case of the
authority granted under paragraph (b) of resolution 12, by way of a rights issue only):
i.
in favour of holders of ordinary shares in the capital of the company, where the equity securities respectively attributable to
the interests of all such holders are proportionate (as nearly as practicable) to the respective number of ordinary shares in
the capital of the company held by them; and
ii.
to holders of any 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 directors may deem necessary or expedient to deal with treasury
shares, fractional entitlements or legal, regulatory or practical problems arising under the laws or requirements of any overseas
territory or by virtue of shares being represented by depository receipts or the requirements of any regulatory body or stock
exchange or any other matter whatsoever; and
b.
the allotment, otherwise than pursuant to sub-paragraph (a) above, of equity securities up to an aggregate nominal value equal
to £645,695 and
unless previously revoked, varied or extended, this power shall expire on the earlier of the date falling 18 months after the date of
the passing of this resolution and the conclusion of the next Annual general meeting of the company except that the company may
before the expiry of this power make an offer or agreement which would or might require equity securities to be allotted after such
expiry and the directors may allot equity securities in pursuance of such an offer or agreement as if this power had not expired.
14. ThAT, the company be generally and unconditionally authorised for the purposes of section 701 of the Act to make market
purchases (within the meaning of section 693(4) of the Act) of Ordinary Shares of 31⁄3p each in the capital of the company
(“Ordinary Shares”) provided that:
a.
the maximum number of Ordinary Shares hereby authorised to be purchased is 19,370,853 (representing 10% of the
company’s issued Ordinary Share capital);
b.
the minimum price, exclusive of any expenses, which may be paid for an Ordinary Share is 31⁄3p;
106
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c.
the maximum price, exclusive of any expenses, which may be paid for an Ordinary Share shall be an amount equal to 105%
of the average of the middle market quotations for an Ordinary Share as derived from the London Stock Exchange daily
Official List for the five business days immediately preceding the date on which such Ordinary Share is contracted to be
purchased; and
this authority shall, unless previously renewed, revoked or varied, expire on the earlier of the date falling 18 months after the date
of the passing of this resolution and the conclusion of the next Annual general meeting, but the company may enter into a contract
for the purchase of Ordinary Shares before the expiry of this authority which would or might be completed (wholly or partly) after its
expiry.
15. ThAT, a general meeting other than an annual general meeting may be called on not less than 14 clear days’ notice.
dated: 18 december 2015
Registered Office:
Thorpe way
grove Park
Enderby
Leicestershire
LE19 1Su
Registered number: 3213782
by order of the board
Stuart Davey
company Secretary
notes
1. The right to vote at the meeting is determined by reference to the register of members. Only those members registered in the register
of members of the company as at 6:00pm on 26 january 2016 or, in the event that the meeting is adjourned, close of business on
such date being not more than 2 days prior to the date fixed for the adjourned meeting shall be entitled to attend and vote at the
meeting in respect of the number of shares registered in their name at that time. changes to entries in the register of members after
6:00pm on 26 january 2016 or, in the event that the meeting is adjourned, after 2 working days before the time of any adjourned
meeting, shall be disregarded in determining the rights of any person to attend or vote at the meeting.
2. A member is entitled to appoint one or more persons as proxies to exercise all or any of his rights to attend, speak and vote at the
meeting. A proxy need not be a member of the company. A form of proxy is enclosed and notes for completion can be found on
the form and should be read carefully before it is completed. To be valid, the form of proxy must be completed, signed and sent to
the offices of the company’s registrars, capita Asset Services, PxS, The Registry, 34 beckenham Road, beckenham, kent bR3 4Tu
together with the power of attorney or other authority (if any) under which it is signed or a notarially certified or office copy of the
same, so as to arrive no later than 10.00 am on 26 january 2016 (or, in the event that the meeting is adjourned, no later than 2
working days before the time of any adjourned meeting).
3. A member may appoint more than one proxy in relation to the meeting provided that each proxy is appointed to exercise the rights
attached to a different share or shares held by him. To appoint more than one proxy, you will need to complete a separate proxy
form in relation to each appointment. you may photocopy the enclosed proxy form, indicating clearly on each proxy form the name
of the proxy you wish to appoint and the number of shares in relation to which the proxy is appointed. All forms must be signed and
should be returned together in the same envelope. you can only appoint a proxy using the procedures set out in these notes and the
notes to the proxy form. The right of a member under section 324 of the companies Act 2006 (the “Act”) to appoint a proxy does
not apply to a person nominated to enjoy information rights under section 146 of the Act.
4. The appointment of a proxy will not preclude a member from attending and voting in person at the meeting if he or she so wishes.
5. As at the close of business on the date of this notice, the company’s issued share capital comprised 193,708,537 ordinary shares
of 31⁄3p each. Each ordinary share carries the right to one vote at a general meeting of the company. no ordinary shares were
held in treasury and accordingly the total number of voting rights in the company as at the close of business on the date of this
notice is 193,708,537.
6. A vote withheld is not a vote in law, which means that the vote will not be counted in the calculation of votes for or against the
resolution. If no voting indication is given, your proxy will vote or abstain from voting at his or her discretion. your proxy will vote (or
abstain from voting) as he or she thinks fit in relation to any other matter which is put before the meeting. The notes to the proxy form
explain how to direct your proxy to vote on each resolution or withhold their vote.
7.
In the case of joint holders, where more than one joint holders purports to appoint a proxy, only the appointment submitted by the
most senior holder will be accepted. Seniority is determined by the order in which the names of the joint holders appear in the
company’s register of members in respect of the joint holding (the first named being the most senior).
107
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cOnT In uEd
8. cREST members who wish to appoint a proxy or proxies through the cREST electronic proxy appointment service may do so by
using the procedures described in the cREST manual. cREST personal members or other cREST sponsored members and those
cREST members who have appointed a voting service provider(s), should refer to their cREST sponsor or voting service provider(s)
who will be able to take the appropriate action on their behalf.
In order for a proxy appointment or instruction made using the cREST service to be valid, the appropriate cREST message (a
“cREST Proxy Instruction”) must be properly authenticated in accordance with Euroclear uk & Ireland Limited specifications and
must contain the information required for such instructions, as described in the cREST manual. The message, regardless of whether
it constitutes the appointment of a proxy or an amendment to the instruction given to a previously appointed proxy, must, in order
to be valid, be transmitted so as to be received by the issuers’ agent (Id RA10) by the latest time for receipt of proxy appointments
specified in this notice. for this purpose, the time of receipt will be taken to be the time (as determined by the timestamp applied
to the message by the cREST Applications host) from which the registrars are able to retrieve the message by enquiry to cREST
in the manner prescribed by cREST. After this time, any change of instructions to proxies appointed through cREST should be
communicated to the appointee through other means.
cREST members and, where applicable, their cREST sponsors or voting service provider(s) should note that Euroclear uk & Ireland
Limited does not make available special procedures in cREST for any particular messages. normal system timings and limitations
will therefore apply in relation to the input of cREST Proxy Instructions. It is the responsibility of the cREST member concerned to
take (or, if the cREST member is a cREST personal member or sponsored member or has appointed a voting service provider(s), to
procure that his cREST sponsor or voting service provider(s) take(s)) such action as shall be necessary to ensure that a message is
transmitted by means of the cREST system by any particular time. In this connection, cREST members and, where applicable, their
cREST sponsors or voting service providers are referred, in particular, to those sections of the cREST manual concerning practical
limitations of the cREST system and timings.
The company may treat as invalid a cREST Proxy Instruction in the circumstances set out in Regulation 35(5)(a) of the uncertificated
Securities Regulations 2001 (as amended).
9. where a copy of this notice is being received by a person who has been nominated to enjoy information rights under section 146
of the Act (“nominee”):
a.
b.
the nominee may have a right under an agreement between the nominee and the member by whom he was appointed, to be
appointed, or to have someone else appointed, as a proxy for the meeting; or
if the nominee does not have any such right or does not wish to exercise such right, the nominee may have a right under any
such agreement to give instructions to the member as to the exercise of voting rights.
108
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10. capita Asset Services maintain the company’s share register. They also provide a telephone helpline service on 0871 664 0300
(calls cost 10p a minute plus network extras). Lines are open from 8:30am to 5:30pm, monday to friday. If you have any queries
about voting or about your shareholding, please contact capita Asset Services.
11. members have the right to ask questions at the meeting in accordance with section 319A of the Act.
12. It is possible that, pursuant to requests made by members of the company under section 527 of Act, the company may be required
to publish on a website a statement setting out any matter relating to: (a) the audit of the company’s accounts (including the auditors’
report and the conduct of the audit) that are to be laid before the meeting; or (b) any circumstance connected with an auditor of
the company ceasing to hold office since the previous meeting at which annual accounts and reports were laid in accordance with
section 437 of the companies Act 2006. The company may not require the members requesting any such website publication
to pay its expenses in complying with sections 527 or 528 of the Act. where the company is required to place a statement on
a website under section 527 of the Act, it must forward the statement to the company’s auditor not later than the time when it
makes the statement available on the website. The business which may be dealt with at the meeting includes any statement that the
company has been required under section 527 of the Act to publish on a website.
13. The following documents are available for inspection by members at the registered office of the company (except bank holidays)
during the normal business hours and at the place of the meeting not less than 15 minutes prior to and during the meeting:
a.
the register of directors’ interests required to be kept under section 809 of the Act;
b. copies of the directors’ service contracts and letters of appointment of the non-executive directors; and
c. a copy of the company’s Articles of Association.
14. Information regarding the meeting, including the information required by section 311A of the Act, is available from the company’s
website – www.toppstiles.co.uk.
109
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Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information Explanatory nOTE S TO ThE nOTIcE Of
An nuAL gEnERAL mEETIng
ThE AnnuAL gEnERAL mEETIng of the company will be held at the marriott hotel, Smith w ay, grove Park, Enderby, Leicestershire
LE19 1Sw on 28 january 2016 at 10.00 a.m.
four of the resolutions are to be taken at this year’s Annual general meeting as special business. by way of explanation of these and the
other resolutions:
ORdInAR y buSInESS
Resolution 1
Receiving the accounts and rep or ts
All quoted companies are required by law to lay their annual accounts before a general meeting of the company, together with the
directors’ reports and auditors’ report on the accounts. At the Annual general meeting, the directors will present these documents to the
shareholders for the financial period ended 3 October 2015.
Resolution 2
declaration of final dividend
A final dividend of 2.25 pence per Ordinary Share is recommended by the directors for payment to shareholders on the register of
members of the company at 6.00 p.m. on 8 january 2016. Subject to approval by the Ordinary Shareholders at the Annual general
meeting, the dividend will be paid 4 february 2016. An interim dividend of 0.75p was declared which means the total dividend level
will 3.00 pence per Ordinary Share for the 53 weeks prior to 3 October 2015.
Resolution 3
directors’ Remuneration Rep or t
All quoted companies are required by law to produce for each financial year a directors’ remuneration report which sets out the
Remuneration committee’s policy in relation to directors’ remuneration, together with the remuneration and benefits paid to directors
during the year. The company is also required to put an ordinary resolution to shareholders approving the report at the meeting at which
the company’s report and accounts for that year are laid (excluding the section of the report comprising the directors’ remuneration
policy). As the directors’ remuneration policy was approved at last year’s annual general meeting and as no changes to the policy are
currently being proposed, no resolution will be proposed this year in relation to the directors’ remuneration policy. Accordingly, resolution
3 seeks the approval of the directors’ remuneration report which is set out on pages 48 to 65 of the report and accounts for the financial
period ended 3 October 2015 (excluding the directors’ remuneration policy).
Resolutions 4 to 9
Re-electi on of directors
The company’s articles of association require that all members of the board of directors submit themselves for re-election at least every
three years. Although not required by the company’s articles, the directors will, in the interests of good corporate governance under the
uk corporate governance code, retire voluntarily and offer themselves for re-election. brief biographical details about all the directors
appear on pages 36 and 37 of the Annual Report and financial Statements.
Resolution 10
Re - appo i n tm en t of auditors
This resolution concerns the re-appointment of deloitte LLP as auditors until the conclusion of the next general meeting at which accounts
are laid, that is, the next Annual general meeting.
Resolution 11
Audi tors’ remuneration
This resolution authorises the directors to fix the auditors’ remuneration.
SPEcIAL buSInESS
Resolution 12
directors’ power to a llot sha res
This resolution complies with guidance issued by the Investment Association and will, if passed, authorise the directors to allot:
• relevant securities up to a maximum nominal amount of £2,152,317 which represents approximately one-third of the company’s
issued ordinary shares (excluding treasury shares) as at the date of this notice. This maximum is reduced by the nominal amount of any
equity securities allotted under the authority set out in paragraph 12(b) in excess of £2,152,317; and
110
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www.toppstiles.co.uk Stock code: TPTadditional information • in relation to a pre-emptive rights issue only, equity securities (as defined by section 560 of the Act) up to a maximum nominal amount
of £4,304,634 which represents approximately two-thirds of the company’s issued ordinary shares (excluding treasury shares) as at
the date of this notice. This maximum is reduced by the nominal amount of any relevant securities allotted under the authority set out in
paragraph 12(a).
Therefore, the maximum nominal amount of relevant securities (including equity securities) which may be allotted under this resolution is
£4,304,634.
As at the date of this notice, the company does not have any treasury shares.
The directors do not have any present intention of exercising the authorities conferred by this resolution but they consider it desirable
that the specified amount of authorised but unissued share capital is available for issue so that they can more readily take advantage of
possible opportunities.
Resolution 13
disapplication of statutor y rights o f pre -e m pt i on
This resolution authorises the directors in certain circumstances to allot equity securities for cash other than in accordance with the statutory
pre-emption rights (which require a company to offer all allotments for cash first to existing shareholders in proportion to their holdings). The
relevant circumstances are either where the allotment takes place in connection with a rights issue or the allotment is limited to a maximum
nominal amount of £645,695, representing approximately 10% of the nominal value of the issued ordinary share capital of the company as
at 9 december 2015 being the latest practicable date before publication of this notice. unless revoked, varied or extended, this authority will
expire at the conclusion of the next Annual general meeting of the company or 18 months after the passing of the resolution, whichever is
the earlier.
The board confirms that it will only allot shares representing more than 5% of the issued ordinary share capital of the company (excluding
treasury shares), for cash pursuant to the authority referred to in paragraph (b) of Resolution 13, where that allotment is in connection with an
acquisition or specified capital investment (within the meaning given in the Pre–Emption group’s Statement of Principles) which is announced
contemporaneously with the allotment, or which has taken place in the preceding six month period and is disclosed in the announcement of the
allotment. In respect of the authority referred to in paragraph (b) of Resolution 13, the board also confirms its intention to follow the provisions of
the Pre–Emption group’s Statement of Principles regarding cumulative usage of authorities within a rolling three–year period where the Principles
provide that usage in excess of 7.5% of issued ordinary share capital of the company (excluding treasury shares) should not take place without
prior consultation with shareholders, except in connection with an acquisition or specified capital investment as referred to above.
TREASuR y ShAR ES
The company may hold any shares it buys back “in treasury” and then sell them at a later date for cash rather than simply cancelling
them. Any such sales are required to be made on a pre-emptive, pro-rata basis to existing shareholders unless shareholders agree by
special resolution to disapply such pre-emption rights. Accordingly, in addition to giving the directors power to allot unissued ordinary
shares on a non pre-emptive basis, resolution 13 will also give directors power to sell ordinary shares held in treasury on a non- pre-
emptive basis, subject always to the limitations noted above. The directors consider that the power proposed to be granted by resolution
13 is necessary to retain flexibility, although they do not have any intention at the present time of exercising such power. As at the date of
this notice, the company does not have any treasury shares.
Resolution 14
Authority to purchase shares (mark e t pu rc ha se s )
This resolution authorises the board to make market purchases of up to 19,370,853 ordinary shares (representing approximately 10% of the
company’s issued ordinary shares as at 9 december 2015, being the latest practicable date before publication of this notice). Shares so
purchased may be cancelled or held as treasury shares. The authority will expire at the end of the next Annual general meeting of the company
or 18 months from the passing of the resolution, whichever is the earlier. The directors intend to seek renewal of this authority at subsequent Annual
general meetings.
The minimum price that can be paid for an ordinary share is 31⁄3p being the nominal value of an ordinary share. The maximum price
that can be paid is 5% over the average of the middle market prices for an ordinary share, derived from the daily Official List of the
London Stock Exchange, for the five business days immediately before the day on which the share is contracted to be purchased.
The directors intend to exercise this right only when, in light of the market conditions prevailing at the time and taking into account all
relevant factors (for example, the effect on earnings per share), they believe that such purchases are in the best interests of the company
and shareholders generally.
111
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An nuAL gEnERAL mEETIng
Theoverall position of the company will be taken into account before deciding upon this course of action. The decision as to whether any
such shares bought back will be cancelled or held in treasury will be made by the directors on the same basis at the time of the purchase.
As at 9 december 2015, being the latest practicable date before publication of this notice, there were outstanding awards under the
company’s various share option schemes in respect of 8,176,737 ordinary shares in the capital of the company representing 4.2%
of the company’s issued ordinary share capital. If the authority to purchase the company’s ordinary shares were exercised in full, the
number of outstanding options would represent 5.0% of the company’s issued ordinary share capital following the repurchase of shares.
Resolution 15
notice period for general meeti ngs
The companies (Shareholders’ Rights) Regulations 2009 require the company to call general meetings (other than annual general
meetings) on at least 21 clear days’ notice unless shareholders approve a shorter notice period of not less than 14 clear days. Such
approval was granted at last year’s annual general meeting and this resolution therefore seeks to renew this approval. The approval will
be effective until the company’s next annual general meeting, at which it is intended a similar resolution will be proposed. The directors’
intention is to only call general meetings on less than 21 days’ notice where such shorter notice period would be in the interests of
shareholders as a whole.
112
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTadditional information The TEAm
A
Aaron butler
Aaron hider
Aaron Lonie
Aaron Rivett
Aaron Smith
Abbeygail boutell
Abby Tween
Abdirahman Ibrahim
Abdul Rouf
Abdul yasir
Adam bennett
Adam cato
Adam chapman
Adam clarke
Adam cook
Adam crowe
Adam gilkes
Adam godfrey
Adam Ireland
Adam nuttall
Adam Parsons
Adam Riley
Adam Robinson
Adam Rodriguez
Adam Rous
Adam Shearsmith
Adam walker
Adam ward
Adam ware
Adam williams
Adil Rajah
Adnan Abdullah
Adrian kimber
Adrian Panzariuc
Afrim mensah
Ahmad Ebrahimi Senobari
Aisha yerimah
Akiyemi Orekoya
Aklakud duha
Akshey vadgama
Alan clague
Alan haji
Alan hughes
Alan Parker
Alan Saunders
Alan Sinclair
Alan Smalley
Alan Sproston
Alan wrighting
Aled collier
Aleksandrs gulenkovs
Alen Sithiravel
Alex Abram
Alex hedges
Alex whitmore
Alexander Armstrong
Alexander bradley
Alexander Esposito
Alexander findley
Alexander heskett
Alexander kempson
Alexander mackley
Alexander Onions
Alexander Torres
Alexander williams
Alexandra davies
Alexandria crowther
Alexandria ferguson
Alfie Abbott
Ali Abshir Ibrahim
Ali Rizvi
Alison hunt
Alison walkinshaw
Alister watt
Allan busby
Allan harper
Alnavaz nuralah
Alwyn bolton
Amanda brogan
Amanda green
Amanda hullett
Amanda Samuel
Amandeep bains
Amber west
Amy hughes
Amy mcgregor
Amy Simmonds
Amy Smith
Amy wirtz
Ananthan Sivanesan
Anantharupan Ananthapuvirajah
Andre Osei
Andrea crooks
Andrea moon
Andrew baldock
Andrew belson
Andrew callister
Andrew canham
Andrew chapman
Andrew childs
Andrew clay
Andrew clayton
Andrew collins
Andrew cox
Andrew curr
Andrew davis
Andrew green
Andrew hamilton
Andrew hanson
Andrew harrison
Andrew huntingford
Andrew king
Andrew middleton
Andrew Page
Andrew Phillips
Andrew Playfoot
Andrew Riley
Andrew Sansum
Andrew Scorgie
Andrew Sharkey
Andrew Shaw
Andrew Taylor
Andrew wade
Andrew wagstaff
Andrew warne
Andrew waterfield
Andrew wathan
Andrew wilkinson
Andrew winterburn
Andrew woods
Andrew young
Aneta kleczek
Angela capp
Angela Toseland
Ann warren
Anna forden
Anna moulding
Anna wedrzyk
Anna-marie Tough
Annmarie malone
Anthony bradford
Anthony christopher
Anthony cox
Anthony daly
Anthony davies
Anthony dedman
Anthony docherty
Anthony dolan
Anthony gibby
Anthony gilbert
Anthony havvas
Anthony james
Anthony Linsell
Anthony molyneux
Anthony Tarr
Antonia hughes
Antonio Perkins
Antony belham
Anub varghese
Anwar marshall
Arkadiusz halas
Aron hoff
Arron Turner
Arthur van Aswegen
Aruna mistry
Ashleigh Richards
Ashleigh Tucker
Ashley cutler
Ashley hegarty
Ashley mansfield
Ashley martin
Ashley Rivett
Ashraful haque
Asteraya Engdayehu
Astone davids
Atul Patel
Audrius kolojanskas
Augustus hagan
b
barbara connor
barbara Smith
barri barnes
barry beaver
barry Edwards
barry hanlon
barry hodges
barry jones
barry Taylor
barry Theobald
barry Thomas
barry veasey
beatrice Onnerth
ben Armitage
ben bright
ben harris
ben holloway
ben howard
ben moore
ben Richmond
ben Tallis
benjamin fullman
benjamin goodey
benjamin Lawson
benjamin moughan
benjamin Rich
benjamin Rowe
benjamin willis
benjamin woollins
berek k-caeser
beth crozier
bianca gradinaru
billy hutchins
billy Lodge
billy Taylor
bobby Attwood
bolaji Adeyanju
brad Squires
113
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information The TEAm
cOnT In uEd
bradley moore
brandon Abels
brandon Adeniji
brant wells
bregetta hill
brendan flynn
brett goulden
brian cariello
brian cook
brian cooper
brian cox
brian crews
brian flatters
brian king
brian Linnington
bruce fielding
bruce garrod
bruno bernasconi
bryan Taylor
byron Tree
c
cade Somerville
caitlin Snider
calbert hall
callum beedles
campbell marr
carl courtney
carl cumberbatch
carl foster
carl fraser
carl hermitt
carl whatley
carl willshee
carley brown
carlos Alford maestre
carlos chowdhury
carlos do Rosario botecas
carol English
carol Tromans
caroline bailey
caroline beattie
caroline bennett
caroline bray
caroline may
caroline vernon-Sutton
carolyn Paull
carolynn Remington-hobbs
catherine britton
catherine Platt
catherine Smith
catrin Anthony-Evans
cecilia Lamb
chamyse morley
charlene walpole
114
charles Robbins
charles Roussard
charles Taylor
charlie Pelchat
charlotte brooks
charlotte fitzgerald
charlotte godfrey
charlotte Lammin
charlotte Stringfellow
charmaine chapman
chelsea battle
chelsea cragg
chelsea crichton
chelsea dale
cherie Ahmet
cheryl vearncombe
chetna Shah
chloe Singleton
choudre grobler
chris dixon
christain mccarthy
christian banham
christine berry
christine hendry
christine Taylor
christine Thistlethwaite
christopher beeson
christopher bland
christopher bolton
christopher bowden
christopher brereton
christopher butler
christopher collins
christopher cooper
christopher cooper
christopher curtis
christopher d’Arts
christopher Edwards
christopher foster
christopher france
christopher harbutt
christopher heyes
christopher holland
christopher howe
christopher joynes
christopher Lamb
christopher Leach
christopher moore
christopher nicholls
christopher nixon
christopher nottle
christopher Perry
christopher Potter
christopher Sansby
christopher Simpson
christopher Tame
christopher Turley
christopher walley
christopher wells
christopher williamson
clair jeffries
claire chaffe
claire harris
claire Rayton
claire Sarnecki
claire Tiney
clare barden
clare cohring
clare fuller
clare Shepherd
claudine charles-Scotton
colin clarke
colin dickson
colin griffiths
colin harvey
colin hayward
colin hoban
colin joy
colin markham
colin nuttall
colin Rymer
colin Skinner
colin Taylor
connor Saunders
connor Swan
connor Turner
conrad harrup
cora morrison
corrie-Leigh goodhew
corrina bowers
cory handford
craig connor
craig dolling
craig henley
craig johnson
craig murphy
craig Reed
cristina cole
czeslaw majorek
d
daisy utley
dale benford
damian harrison
damian Liu
damien mole
damontre Love
daniel Ashby
daniel bevan
daniel brain
daniel caruana
daniel chambers
daniel clayton
daniel cox
daniel Evans
daniel fallows
daniel friend
daniel grunwell
daniel hamilton
daniel Ingham
daniel jenkins
daniel jones
daniel jones
daniel Lawrie
daniel Little
daniel mcLean
daniel milner
daniel musguin
daniel neary
daniel Parsons
daniel Philpott
daniel Poile
daniel Robinson
daniel Saltmarsh
daniel Scott francis
daniel Sheppard-brown
daniel Thornley
daniel willows
daniel wren
daniel wright
danielle kirby
danielle noyes
danielle Omara
danielle Rains
danielle whittaker
danny burgess
danny mcInnes
danny Ostler
darius bright
darran wood
darren bebbington
darren chester
darren doughty
darren harper
darren mencarini
darren mitchell
darren morgan
darren murray
darren Shapland
darren Sherwood
darren Square
darren wagg
darren weedon
darron bicknell
darron kerr
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTadditional information darryl ferry
david Atherton
david Augustus
david beasley
david blackhurst
david blades
david bolingbroke
david brooks
david burnikell
david callaghan
david carpenter
david clare
david clark
david coupland
david Elliott
david fletcher
david hamer
david harper
david hatton
david hayers
david henderson
david hill
david hirst
david hope
david hussey
david jardim
david jobling
david jones
david kershaw
david kettlewell
david knight
david Lane
david Locke
david Longman
david macartney
david marsh
david matthews
david medlam
david meers
david miller
david murray
david nichol
david Oliver
david Palmer
david Plant
david Prime
david Rendall
david Savage
david Sheehy
david Shewan
david Simms
david Simons
david Sinclair
david Smith
david Steel
david Stott
david Thomasson
david Thompson
david Timbrell-clark
david Townsley
david webb
david webb
david weller
david whitelaw
david wilson
david yallop
dawn Allan
dawn gale curtis
dean kelly
dean marshall
dean miller
dean newell
dean Partridge
dean Smith-crome
dean Titchen
dean woolley
deana Turner
deborah Edwards
deborah gobey
deborah Rooney
declan matthiesen
decland Speede
denis Ahmet
denis O’brien
denise johnson
dennis jovellanos
dennis Lammas
dennis Rawding
denzil johns
derek Amoo
derek goosen
derek Sim
dermott Reilly
desiree Turner
devias gudka
devindren govender
dewi Evans
dexter Lawrie
didar uddin
dilawar Ali
dilip Parmar
dinesh Amin
dipal Parikh
dominic d’Souza
dominic gray
dominic hall
dominic johnson
dominic Reilly
dominic Summers
donald benson
donald magullian
donald morrissey
donald nyoni
donna douglas
donovan Robinson
dorothy Stewart
douglas bingham
douglas nicol
drew Aldom
duncan foy
duncan mayman
dwain mensah
dylan Roberts
dylan Taylor
E
Eamonn clancy
Edgars Lesinskis
Edward murphy
Eirini messaritaki
Elaine noone
Elizabeth harbord
Elizabeth Selfridge
Ellie howcroft
Emily Lenton
Emily madge
Emily mansell
Emma childs
Emma crucefix
Emma curtis
Emma dudley
Emma french
Emma Peat
Emma whatson
Emran mannan
Emre caran
Entiliano marku
Eric Asuming
Ermiyas girma
Ewa Lukaszewska
Ezra Evans
f
faisal Ashraf
faisle Sharif
faizar Ali
fay dodson
fayzur Rahman
felipe west
fiona grant
fitz martin
fizan Rajah
frances Aylward
francesca wright
francis weldon
frank gardner
frank hibbert
fred Therme
g
gabriella carvalho
gage wheeldon
gail Purves
gareth davies
gareth fogden
gareth meakings
gareth moss
gareth Pye
garry hardy
gary Allum
gary Ashdown
gary bloomfield
gary curtis
gary gear
gary gledhill
gary gledhill
gary hawrylak
gary marsden
gary marshall
gary nash
gary Pickavance
gary Roberts
gary Shapcott
gary Thatcher
gary woolmore
gavin bennett
gavin collins
gavin magwood
gavin meek
gavin mitchell
geeta makwana
gemma gilliver
gemma haynes
gemma kleeman
gemma Stephens
geoffrey greenwood
george Astill
george birkley
george burns
george hawkes
george martinesz
georgina carlberg
geraint griffiths
geraint Thorne
ghirmai Solomon
gianfranco Zanolini
gianluca Ostinelli
gillian grace
gino muco
115
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information The TEAm
cOnT In uEd
glendale canoville
glenis gibson
glenn claridge
glenn Elgy
glyn Rogers
gordon davies
graeme Inchley
graham cooper
graham foster
graham jones
graham Livingstone
graham vance
grant harris
greg Lloyd
gregory mchugh
grenville davies
gurinder chana
gurnaam Sharma
h
hannah carter
hannah Peeroo
hannah Pritchard
hanz nelson
harmeet jassal
haroon cockar
harriet goodacre
harry biggs
harry kay
harsimran Singh bagga
hazel millington
heather findler
heather-marie cooper
helen beaumont
helen gosling
helen hughes
helen walker
henry Smith
hesham kashi
himesh hirani
hitesh nathu
holly baxter
holly nettleton
hugh Selley
I
Iain Arnott
Ian Aikman
Ian bird
Ian bloomfield
Ian caley
Ian costen
Ian hughes
Ian marshall
116
Ian marshall
Ian mcneish
Ian noon
Ian Paterson
Ian Snook
Ian Sykes
Ian Tivendale
Ibrahim Ali
Ilars Skabeikis
Imran Ashraf
Inderdeep dhanjal
Irene dickinson
Ivan Paitoo
Iyuthanraj Ratnam
j
jaasir wazir
jacek Zebrowski
jack Allardyce
jack cairns
jack campany
jack coker
jack finlay
jack fry
jack haynes
jack Ingram
jack maddison
jack millman
jack O’neill
jack Relfe
jack walker
jack webster
jack white
jack whitehead
jack williamson
jacqueline byrne
jacqueline desborough-
morehead
jacqueline farnan
jade bunce
jahtal nisa Roberts-joseph
jailuene Peake
jajwinder harar
jake Osborn
jake Shopland
jake woods
james bayley
james biesty
james cameron
james carpenter
james clifford
james cooney
james davies
james faulkner
james fox
james heard
james hoare
james hollis
james holt
james hubball
james jeffreys
james Lawson
james mcgeoch
james morgan
james Pannett
james Patston
james Pearson
james Pilfold
james Robertson
james Rolfe
james Saunders
james Snuggs
james Taylor
james Teahan
james Tuvey
james vander Plank
james walker
james watt
james worden
jamie Evans
jamie jenkinson
jamie Rose
jamie Sia
jamie wenborn
jan Reddi
jane harrison
janet Riley
janice millett
janine moon
jarreth hawkins
jasbir Singh
jason barker
jason buckley
jason coupland
jason darcy
jason Ealden
jason gallagher
jason knox
jason meadows
jason Pratt
jason Rose
jason Thomas
jason wilcox
jaunius kurstakas
javeed Parkar
jay Strawford
jayandrie chetty
jayaprakash Paragjee
jayden cuthbert
jaymal Arjan
Proof 9 9 December 2015 6:10 PM 24457.04
jayne warlow
jeannette hastie
jed nethercot
jedrzej Politowski
jeff Arscott
jeffrey Armstrong
jeffrey mudiman
jemma wyatt
jennifer Seabrook
jennifer wall
jennifer yates
jenny Inkson
jessica cokeley
jessica mccarthy
jessica Rowlands
jessica Thiari
jigna naran Lalji
jill cox
joanna dimonaco
joanna herbert
joanna Terrell
joanne cox
joanne Elton
joanne harris
jodie jones
joe Lamond
joe mathews
joe mcPherson
joe Smith
joel barker
john bingley
john bourke
john cook
john cooper
john Ellis
john fawkes
john field
john forden
john gardner
john harris
john harrison
john hesp
john hickey
john hughes
john keouski
john mcLaren
john moat
john murphy
john Page
john Shaw
john Smith
john Tait
john Taylor
john Thompson
johnathan mccallum
www.toppstiles.co.uk Stock code: TPTadditional information jon davis
jon Reynolds
jon Thatcher
jon-Paul hughes
jonathan boxall
jonathan coombs
jonathan coyne
jonathan East
jonathan hall
jonathan hargreaves
jonathan morgan
jonathan Pringle
jonathan Roberts
jonathan Samuel
jonathan Sheerin
jonathan Smith
jonathan Stearman
jonathan Stone
jonathan Sutton
jonathan wallace
jonathan williams
jonathan woodroff
jonathon Turner
jordan gibbins
jordan macdonald
jordan webb
josef kinski
joseph cox
joseph daly
joseph gregorace
joseph jones
joseph Reames
joseph Shyne
joseph Sweeney
josephina Lane
josephine ketskemety
joshua batterham
joshua blain
joshua darby
joshua Elliott
joshua groener
joshua jackson
joshua Lambert
joshua Outram
joshua Paton-Rolls
joshua Rapley
joshua wright
judith duncan
juginder gill
julia kerr
julian myles
julie brachtvogel
julie cox
julie fewings
julie-anne harris
juliet wilford
justin bradley
justin coyle
justin Evans
justin korankye-Addai
justin marlow
juttinder digpal
k
kalpeshkumar Patel
kamal Embarek
kamaljit Atkar
kamaljit Thandi
kamil janas
kamlesh Shah
karen brook
karen dodds
karen Leimetter
karen Sutcliffe
karis hall
karl Aran
karl batterham
karl haines
karl Lippiatt
karl Stephens
karl Turner-Talmage
karl verry
karl white
kashan Riley
katarzyna Roberts
kate flitton
kate O’connor
katerina gavriel
kathrine wainwright
kathryn baird
kathryn finch
kathryn Pell
kathryn Robinson
katie boggis
katie brindley-hughes
katie bush
katy hyslop
kawaljit gulati
keiran Ling
keith Alexander
keith Ambrose
keith baker
keith down
keith Earl
keith fitzpatrick
keith johnson
keith Rudkin
kelly Savile
kelly weyman
kelly-Anne O’connor
kelvin Lansdowne
kenneth Owen
kenneth westley
kenneth williams
kerri Atkinson
kevan Richardson
kevin Atherton
kevin baker
kevin bowtle
kevin fox
kevin hailes
kevin hardy
kevin hartley
kevin hodson
kevin jeans
kevin jones
kevin nicol
kevin Redmond
kevin Rowe
kevin Sheils
kevin Smith
kevin Thorne
kieran barnes-warden
kieran corben
kieran fleet
kieran gardiner
kieron clarke
kim Liddle
kim moriarty
kirandeep kaur
kirk Irvine
kirsten cummings
kirstie Leonard
kirstie mcdowell
kirti Patel
kranthi billakanti
kristian catterall
kristopher bailey
kristopher brough-Rutland
krystian Sior
krystle milan
kuljit Aujla
kunal Pandya
kyle francis
kyle hardie
kyle morris-campbell
kyle nightingill
kyle welford
L
Lance cale
Lara mckenzie
Laura Adams
Laura costa
Laura henry
Laura horton
Laura jacques
Laura james
Laura johnson
Laura Racey
Laura Sansom
Lauren bettison
Lauren holmes
Laurence jones
Laurence Pendrill
Lauris Popovs
Lavarn morgan
Layla kellaway
Layla Pring
Layla Pyatt
Leah morgan
Leanne curry
Leanne Palmer
Lee Adam
Lee baxter
Lee carlos
Lee cash
Lee clarke
Lee dering
Lee dover
Lee galloway
Lee gardner
Lee gibson
Lee graham
Lee hutchinson
Lee jacovou
Lee james
Lee johnstone
Lee jones
Lee mcconnell
Lee Read
Lee west
Lee wilkinson
Leigh hyam
Leighton davies
Leon O’neill
Leon Pryce
Leona Parker
Leonard finch
Leonora moses
Lesley watson
Lesley willcox
Lesley wilson
Leslie Shemmeld
Lewis Adkins
Lewis Axford
Lewis collins
Lewis crossley
Lewis hall
Lewis harry
117
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information The TEAm
cOnT In uEd
Lewis Prentice
Lewis Saunders
Lewis walter
Lewis williams
Leza mcdonald
Liam Allen
Liam bantin
Liam cowan-fields
Liam hogan
Liam hubbard
Liam hunt
Liam moore
Liam Piper
Liam Rushton
Lianne harrison-Allcock
Libby field
Linda herbert
Linda Scott
Lindsey flint
Lisa Algar
Lisa cullen
Lisa holmes
Lisa noel
Lisa Pallett
Lloyd jackson
Loucas Louca
Louis whittle
Louise jeffery
Louise wilson
Luana freeman
Lucas mavlappas
Lucinda mazzei
Lucy mcgennity-bane
Lucy Taylor-Simpson
Luke cameron
Luke day
Luke durham
Luke kerr
Luke Livermore
Luke mcnally
Luke Patel
Luke Potiphar
Luke Saunders
Luke Tilley
Luke Tilson
Luke woodward
Luke woodward
Luther Tunmore-Lansdowne-kyi
Lynette Levi
Lynn Pearson
Lynsey Smart
118
m
maciej krzyzaniak
maciej Rabczewski
mahesh wara
mahomadzuber Saiyed
malcolm ferguson
malcolm Temple
mandy Aidney
manjit Aluwahlia
mansoor Ali
marc Trim
marcin kupczyk
marcin malinowski
marcin Sakowicz
marcin Senkowski
marcus battie
marek kloda
margaret Lawrie
maria drozdova
maria furniss
maria Thompson
marie biggs
marius jackevicius
mark Allenden
mark Allman
mark bianchi
mark braithwaite
mark brown
mark burgess
mark coe
mark davies
mark discombe
mark frisby
mark fuller
mark gasson
mark holland
mark hunter
mark johnson
mark johnston
mark keymer
mark Lever
mark maciver
mark mott
mark Owen
mark Palmer
mark Pancott
mark Ridley
mark Stephens
mark Tennant
mark Thompson
mark Tilley
mark vaughan
mark waldock
mark walters
mark whitaker
mark winder
mark winger
mark woodyatt
mark wordley
mark wright
mark wylie
marlon barnes
marlon bright
martha karczewska
martin derricott
martin Evans
martin foster
martin Osborne
martin Pickard
martin Sloggett
martin Smyth
martin Turner
martin williams
martin williams
martin winterburn
martin wys
martina way
martyn costen
martyn Lovell
martyn Somerville
martyn Spring
martyn Strange
mary Syme
mathew clifton
mathew demaurie
mathew Lampard
mathew Tapp
matthew Antell
matthew Attwood
matthew britton
matthew copestake
matthew crowton
matthew dunne
matthew fisher
matthew foster
matthew foulger
matthew harris
matthew hawley
matthew hay
matthew holland
matthew Ingram
matthew jones
matthew king
matthew Lindsay
matthew Love
matthew mcPhee
matthew moore
matthew nash
matthew Richardson
matthew Robinson
matthew Robinson
matthew Sims
matthew Stevenson
matthew Stewart
matthew warne
matthew wesson
matthew whitlock
matthew williams
matthew williams
matthew woodhouse
matthew wright
megan broadway
mehmet Asdoyuran
mehran ulhaq
melanie Abbott
melanie gray
melanie Toole
melissa wadman
mellissa hemming
melton Thompson
melvyn chamberlain
mervyn Thorne
michael boland
michael boughton
michael bowden
michael buckley
michael comer
michael congdon
michael darroch
michael dinnage
michael dinter
michael Earls
michael Edwards
michael Edwards
michael fannon
michael fawcett
michael finkill
michael finn
michael foley
michael goodfield
michael griffiths
michael haggett
michael hall
michael hopper
michael howden
michael huskisson
michael jack
michael jenks
michael kolapo
michael Lay
michael Litster
michael Locke
michael Lovelock
michael mcgarry
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTadditional information michael mcnally
michael moss
michael queen
michael quinn
michael upton
michael van Sittert
michael weeks
michaela Thomas
michaella watson
michal Politowski
michele Trickett
michelle hill
michelle kempson
michelle le monnier
michelle moore
mick wells
miles burden
mindaugas kairys
mitchell williams
mkhonto gumede
mohamed mufallal
mohamed Patel
mohammad mukhtar
mohammad uddin
mohammed Amin
mohammed hoque
mohammed jamil
mohammed jimale
mohammed khalid
mohammed Parvaz
mohammed Ibad khan
morva Leslie
mr Thomas watson
mr Topps (retired)
mubashir uddin
muhammad Ikram Shafqat
murdo martin
mustafa khan
mustafa mohamed
n
naomi mckenzie
narinder chatha
natalie boyd
natalie mccuaig-finlay
natalie Paine
natalie Palumbo
natalie Ratsavong
natasha danby
natasha hibberd
nathan Austin
nathan cavanagh
nathan coulthard
nathan harry
nathan Sobers
nathan wells
nathan wilson
nathan winterton
nauris vinkelis
ndumiso mafa
neil Ammon
neil brownley
neil hendy
neil homan
neil jones
neil muckle
neil Pears
neil Roessner
neil Southgate
neil Sparkes
neil Topping
neil wardlaw
neil williams
nicholas Aylwin
nicholas billyeald
nicholas gadd
nicholas harden
nicholas houghton
nicholas Lawrence
nicholas Lee
nicholas Lodge
nicholas Redway
nicholas Stone
nicholas walch
nicholas withers
nicholaus buchanan
nick wardman
nicky glenister
nicola howlett
nicola mcwatt
nicola Squires
nicole Andrews
nigel fleming
nikki hymers
nirmal Sagoo
nishit Shah
numan usman
O
Oliver haghighi
Olivia harte
Olivia Pilson-wood
Omid Ibrahimi
Ovidiu Agache
Owen Tudor
Oz masaya
Ozan kaya
P
Paige makepeace
Pankaj bhardwaj
Paolo Segagni
Paresh nagar
Patricia duncan
Patrick coleman
Paul baxter
Paul burkett
Paul burrow
Paul cartledge
Paul chambers
Paul chapman
Paul clark
Paul cowen
Paul dalby
Paul davey
Paul Elliott
Paul freeborn
Paul galvin
Paul goddard
Paul hargreaves
Paul hesketh
Paul holmes
Paul hutchins
Paul Irving
Paul kelly
Paul Laverty
Paul Lee
Paul Lester
Paul Logue
Paul mccabe
Paul miller
Paul mills
Paul nicholls
Paul noyes
Paul Semple
Paul Silvester
Paul Smith
Paul Starkey
Paul Tennant
Paul Third
Paul Tregaskis
Paul west
Paul whittington
Paul whitworth
Paul wilson
Paula budsworth
Pauline harrison
Pawel Pudelko
Pawel warych
Penny davis
Pete bauer
Peter Anderson
Peter callan
Peter charters
Peter crimp
Peter gibbons
Peter goulding
Peter hanley
Peter higgins
Peter hogg
Peter james
Peter knights
Peter Lees
Peter Simmonds
Peter Sincock
Peter Turtle
Peter vallely
Peter wiles
Peter young
Philip cranston
Philip d’Souza
Philip dunn
Philip gallop
Philip jones
Philip kelly
Philip kelly
Philip mccarney
Philip Okai
Philip Stocks
Phillip brundell
Phillip goode
Phillip gundel
Phillip walters
Phillipa hewitt
Phoebe webb
Poonam Patel
Portia boehmer
Preline martha
Pritisha mukherjee
Przemyslaw drabinski
q
quadeer Ahmed
quang Pham
R
Rachel cartmell
Rachel fellows
Rachel johnson
Rae williams
Rafal Szlachetka
Rain Richmond
Raj Surani
Rajiv vadgama
Rajneet Sahota
Raul Ivanescu
119
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information The TEAm
cOnT In uEd
Ravendra bishun
Rebeca wallis
Rebecca butler
Rebecca julier-goodwin
Rebecca kelly
Rebecca mills
Rebecca moore
Rebecca Oblein
Rebecca Ogilvie
Rebecca Redfern
Rezim Ahmad
Rhys bennett
Rhys hedges
Richard bickers
Richard bleach
Richard bourne
Richard brooks
Richard carter
Richard carter
Richard clark
Richard davies
Richard diamond
Richard Edwards
Richard geare
Richard hickman
Richard hopkin
Richard hudson
Richard Lewington
Richard mann
Richard mccracken
Richard Oates
Richard Oldale
Richard Palfrey
Richard Slack
Richard Small
Richard westell
Rickie byrne
Ricky bishop
Ricky freeman-Roach
Robbie Perry
Robel ghebrewold
Robert Adams
Robert Adkins
Robert Allman
Robert ballantyne
Robert beard
Robert black
Robert chawner
Robert clark
Robert clarke
Robert clarke
Robert collins
Robert Exley
Robert gedlek
Robert george
120
Robert howker
Robert jackson
Robert jay
Robert jones
Robert keohone
Robert king
Robert knight
Robert kreamer
Robert kweli
Robert moss
Robert myers
Robert Parker
Robin Auld
Robin Perrin
Robin Stagg
Roger gridley
Roger Lazenby
Romal williams
Romans Petuhovs
Ronald woolgar
Rory Reeves
Ross Ashbrook
Ross copley
Ross dyson
Ross kerr
Ross knight
Ross Langford
Ross matthews
Roxanne Evans
Russell Arnold
Ryan Apark
Ryan bryant
Ryan coleman
Ryan curd
Ryan french
Ryan jones
Ryan Lawrence-cokayne
Ryan Randall
Ryan Ruffle
Ryan watts
S
Sabina Redlin
Sahibjit Samra
Sahla Trew
Salman bawani
Sam Attfield
Sam davis
Sam Thomas
Samantha cunnington
Samantha Evans
Samantha gray
Samantha Leavis
Samantha makrygiannis
Samantha Simons
Sameer jamdar
Samson Okolosi
Samuel carey
Samuel heath
Samuel kirk
Samuel Robinson
Samuel white
Samuel yoganathan
Sandra Ramsay
Sanjeev Pal
Sarah bacon
Sarah barker
Sarah burnard
Sarah cassam
Sarah dobson
Sarah drake
Sarah harrup
Sarah jordan
Sarah kite
Sarah mclure
Sarah newcomb
Sarah jane Pierpoint
Satinder nandhra
Satvinder Sandhu
Savio coutinho
Scott Ahmad
Scott birdseye
Scott bond
Scott currie
Scott gill
Scott goodway
Scott johnston
Scott meadows
Scott Pattison
Scott Summers
Scott Thirlaway
Scott williams
Sean cahill
Sean collins
Sean dare
Sean gee
Sean king
Sean mcLean
Sean Tagney
Sean Taylor
Sean Tugman
Sean weatherby
Shafeek mohamed
Shahid mahmood
Shamara mckenzie-Rochester
Shana Esworthy
Shane bryan
Shane daley
Shane England
Shane Lindsay
Shane malone
Shane mason
Shane Till
Shannon Oliver
Sharif Islam
Sharon beckett
Sharon buckley
Sharon Papantoniou-barrett
Sharon Simmonds
Shaun dodson
Shaun harwood
Shaun mayes
Shaun Pawsey
Shaun Scanlon
Shaun Scott
Shauna campbell
Shaynah gandhi
Sheikh Saidy
Shelley burton
Shelley carey
Shelley Rutter
Shineat nicholls
Shirley moore
Shrina Shah
Shyam Pankhania
Shylo brookes
Sian Austen
Silvi Atanasova
Silvonne mcLean
Simon beare
Simon bodell
Simon brookfield
Simon brookfield
Simon chappell
Simon coombs
Simon farley
Simon frew
Simon green
Simon grimmett
Simon jackson
Simon jones
Simon knight
Simon Lasham
Simon Leslie
Simon Lewis
Simon marks
Simon morgan
Simon neal
Simon Pitt
Simon Roberts
Simon webb
Simon witham
Simona barticel
Sinead gray
Siobhan Ashman
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTadditional information Skender Trstena
Sophie doggart
Sophie Pitt
Sophie Pritchard
Stanislaw maciorowski
Stefan clark-carter
Steffan williams
Stephanie Ailwood
Stephanie hogg
Stephanie nevett
Stephen Adams
Stephen Amos
Stephen Anthony
Stephen bloomfield
Stephen boyd
Stephen brown
Stephen carr
Stephen clayton
Stephen collins
Stephen corkett
Stephen Edmonds
Stephen Erskine
Stephen foote
Stephen france
Stephen freeman
Stephen gaylor
Stephen green
Stephen hall
Stephen Iwasyszyn
Stephen kelly
Stephen Lopes
Stephen machin
Stephen maidment
Stephen marshall
Stephen morris
Stephen Phillips
Stephen Rowlinson
Stephen Sanders
Stephen Seymour
Stephen Smith
Stephen Smith
Stephen Spurgeon
Stephen Starkie
Stephen welsby
Stephen west
Steven birch
Steven bristow
Steven dooley
Steven dyer
Steven gillham
Steven higgins
Steven howells
Steven Ives
Steven jenkins
Steven kane
Steven kernot
Steven Larner
Steven macarthur
Steven Presley
Steven Richards
Steven Souter
Steven walker
Steven whitehead
Steven wood
Steven woods
Stuart baigent
Stuart barrett
Stuart clarke
Stuart corlett
Stuart davey
Stuart dixon
Stuart fletcher
Stuart furlonger
Stuart harris
Stuart Langford
Stuart munton
Stuart Pemberton
Stuart Rees
Stuart Ross
Stuart Smith
Stuart whitby
Stuart williams
Sukhdev bains
Sule daley
Surmukh jandu
Susan Attwell
Susan bill
Susan black
Susan henshall
Susan hulme
Susan Law
Susan Shields
Syed Ali
T
Tahmid Islam
Tami Robinson
Tammie O’Lone
Tammie Spencer
Tauseef usman
Terence dooley
Teresa Allen
Terry Salisbury
Terry Smith
Tevyn mathurin
Theruchenthuran Erathinasingam
Thomas brien
Thomas britten
Thomas crawford
Thomas cunningham
Thomas Elliott
Thomas Evans
Thomas fitzgerald
Thomas gercs
Thomas Lewis
Thomas Lowe
Thomas miller
Thomas mills
Thomas moran
Thomas murray
Thomas newman
Thomas Otley
Thomas Parkes
Thomas Ross
Thomas Ryan
Thomas Seaden
Thomas Surridge
Thomas Swain
Thomas utting
Thomas wade
Thomas wade
Thomas weedon
Thomas whitlock
Tim chatfield
Tim Richards
Timea Szabo
Timmy Sandwell
Timothy bentley
Timothy bird
Timothy boardman
Timothy coupland
Timothy hartwick
Timothy Stanhope
Timothy Tatlock
Timothy Tuff
Tobias knox
Toby bayley
Toby collins
Todd Routledge
Tom mason
Toni gormley
Toni Lambert
Tony dumbleton
Tony higson
Tracey hansard
Tracy wearmouth
Tracy wickenden
Trashgim Syla
Travis Thompson
Trevor Thomas
Tyrell beckham
Tyrone gambrell
u
udo jungbecker
useni feno
v
veronica Evett
victoria carrington
victoria moore
vilius meilus
vinod joshi
w
waqar Raja
warren bester
wayne farini
wayne Randall
wayne Reed
wei mean donlan
wesley neukermans
will carter
william bailey
william barreda
william gunshon
william Lewinton
william Ralls
william Short
william wylie
wyn dunn-davies
y
yasinul hoque
yohannes getachew
yvonne burgess
Z
Zahid hossain
Zainab Idris
Zlatko milovanovic
Zoe Atkinson
Zoe fletcher
Zoe killick
Zydrunas Slazikas
121
Proof 9 9 December 2015 6:10 PM 24457.04
Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015overviewStrategic reportgovernancefinancial StatementSadditional information Store LOcATIOnS
Lond on
chesham
chingford
colindale
golders green
harrow
hayes
highgate
maida vale
new Southgate
new Southgate Tc
north finchley
Park Royal
Ruislip
Southall
Staples corner
uxbridge
wembley
willesden
barking
beckton
catford
charlton
dagenham
dartford
Eltham
forest hill
Ilford
Ilford Seven kings
mile End
Old kent Road
Romford
Shoreditch
Acton
battersea
brentford
cheam
East Sheen
feltham
fulham
gunnersbury
hounslow
Penge
Raynes Park
Streatham
Surbiton
Twickenham
vauxhall
wandsworth
wimbledon
borehamwood
Enfield
hemel hempstead
St Albans
waltham cross
122
Sale
Salford
Snipe (Audenshaw)
Stockport
Stockport Tc
wakefield
bury
Scot land an d
nor th er n I rel and
Aberdeen (bridge of don)
Aberdeen (wellington)
Ayr
belfast newtonabbey
dumfries
dundee
Edinburgh (fort kinnaird)
Edinburgh (Seafield)
belfast boucher Road
Elgin
glasgow
govan
greenock
hillington
Inverness
Shawfield
Sighthill
wishaw
Sout h
cribbs causeway
Evesham
hereford
cambridge
kings Lynn
Peterborough (boongate)
Peterborough (Rex centre)
St neots
Stamford
wisbech
huntingdon
market harborough
northampton (Orbital Park)
wellingborough
worcester
Abingdon
basingstoke
bristol
cheltenham
chippenham
cirencester
clevedon
frome
gloucester
beckenham
bromley common
croydon (Purley)
croydon (Thornton)
Orpington
Orpington Tc
west wickham
clapham
Islington
walton on Thames
bayswater boutique
wimbledon boutique
mid lan ds
barnsley
doncaster
doncaster Sprotborough
grimsby
hull
hull Tc
Rotherham
Sheffield meadowhall
worksop
newcastle-under-Lyme
northwich
boston
chesterfield
derby (meteor)
derby (Osmaston)
grantham
Lincoln (Outer circle)
Lincoln (St marks)
Long Eaton
mansfield
newark
nottingham (castle Park)
nottingham Lady bay
Spalding
binley
coventry
Enderby
Erdington
kettering baron
kings heath
Leicester
Loughborough
nuneaton
Rugby
Sheldon
Solihull
Stratford
burton on Trent
cannock
congleton
crewe
fenton
great barr
kidderminster
Lichfield
nantwich
Redditch
Shrewsbury
Stoke On Trent Tc
Tamworth
Telford
west bromwich
wolverhampton
nor th
carlisle
workington
darlington
durham dragonville
gateshead
harrogate
northallerton
Scarborough
Sheffield Penistone Road
Sunderland
Stockton
Tyneside
york clifton moor
Aintree
Anfield
barrow
birkenhead
blackburn
blackpool marton
bolton
chester
chorley
cleveleys
morecambe
Ormskirk
Preston
St helens
warrington
widnes
wigan
wigan Tc
bradford
cheadle
cheetham hill
failsworth
huddersfield
hyde
Leeds
macclesfield
Oldham
Pontefract
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTadditional information Proof 9 9 December 2015 6:10 PM 24457.04
124
Proof 9 9 December 2015 6:10 PM 24457.04
www.toppstiles.co.uk Stock code: TPTadditional information Topps Tiles Plc Annual Report and Accounts for the 53 week period ended 3 October 2015
OvE RvI Ew
ST R AT EgIc R E P O R T
gOvE RnAn cE
fInAn cI A L S TAT EmEnT S
Ad dI T I OnA L In fO RmAT I On
wales
bangor
barry
bridgend
cardiff (hadfield Rd)
cardiff (newport Rd)
carmarthen
cross hands
flint
haverfordwest
merthyr Tydfil
neath
Rhyl
Swansea (cwmdu)
Swansea (Llan Samlett)
wrexham
camberley
chichester
fareham
farnborough
farnham
gatwick
guildford
hedgend
horsham
Isle Of wight
Lewes
millbrook Southampton
newhaven
Portsmouth
waterlooville
wokingham
barnstaple
bodmin
bournemouth
bridgewater
christchurch
dorchester
Exeter
Exmouth
glastonbury
Launceston
Plymouth
Plymouth Tc
Poole
Salisbury
Taunton
Torquay
Truro
weymouth
yeovil
Ashford
bexhill
broadstairs
canterbury
Eastbourne
folkestone
maidstone
Sevenoaks
Sittingbourne
Strood
Tonbridge
Tunbridge wells
uckfield
hailsham
hengrove
newbury
Oxford (botley)
Oxford (cowley)
Reading
Swindon
Swindon Tc
weston Super mare
winchester
witney
basildon
braintree
bury St Edmunds
chelmsford
chelmsford Springfield
clacton on Sea
colchester
cromer
great yarmouth
Ipswich
Lowestoft
martlesham
norwich
norwich hall Road
norwich mile cross
Rayleigh
Southend
Sudbury
Thetford
Aylesbury
high wycombe
Slough
windsor
brentwood
crayford
Erith
grays
byfleet
East molesey
banbury
bedford (Elm farm)
bicester
bishops Stortford
buckingham
harlow
harlow Tc
Letchworth
Loughton
Luton
milton keynes
Stevenage
watford
welwyn garden city
bognor Regis
brighton
Proof 9 9 December 2015 6:10 PM 24457.04
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Topps Tiles Plc
Thorpe Way, Grove Park, Enderby,
Leicestershire
LE19 1SU
United Kingdom
www.toppstiles.co.uk
Proof 9 9 December 2015 6:10 PM 24457.04