T
o
t
a
l
l
y
p
l
c
A
n
n
u
a
l
R
e
p
o
r
t
f
o
r
t
h
e
y
e
a
r
e
n
d
e
d
3
1
M
a
r
c
h
2
0
2
0
HIGH-QUALITY
HEALTHCARE SERVICES
ACROSS THE UK
Annual Report
for the year ended 31 March 2020
URGENT
CARE
PLANNED
CARE
INSOURCING
DELIVERING EXCELLENCE
We at Totally plc make a difference to people’s lives by delivering
high-quality care services in local hospitals and community
settings via telephone, video and face-to-face consultations.
www.totallyplc.com
Strategic Report
01 2019/20 highlights
02 What we do
03 Our strategic roadmap
04 Chairman’s statement
05 Chief Executive Officer’s review
08 Our business model
10 Our divisions
13 Our strategy and KPIs
14 Clinical quality review
18 Financial review
21 Risk management
22 Principal risks and uncertainties
23 Section 172 statement
Governance
24 Board of Directors
26 Senior Management
27
Chairman’s introduction
to governance
28 Corporate governance report
32
Report of the Nomination Committee
33 Report of the Audit Committee
35
Directors’ remuneration report
38 Directors’ report
40
Energy and emissions report
41
Statement of Directors’
responsibilities
Financial Statements
42
Independent auditor’s report
47
48
49
Consolidated statement of profit or
loss and other comprehensive income
Consolidated statement of changes
in equity
Consolidated and Company
statements of financial position
50 Consolidated cash flow statement
51 Notes to the financial statements
80 Company information
2019/20 highlights
A RECORD YEAR
FOR THE GROUP
FINANCIAL HIGHLIGHTS
Revenue
Total of all revenue generated
by the Group.
£105.9m +35.8%
105.9
78.0
42.5
0.5
4.0
Underlying EBITDA
Adjusted for items as disclosed
in note 8 of the financial statements.
£4.0m +265%
Cash
Total of all cash held
across the Group.
£8.9m +19%
4.0
10.2
8.9
7.5
1.1
(0.4)
(1.2)
0.2
1.0
0.4
2015
2016
2018*
2019
2020
2015
2016
2018*
2019
2020
*
15-month period.
2015
2016
2018*
2019
2020
OPERATIONAL HIGHLIGHTS
KEY NUMBERS
• Successfully completed acquisition of Greenbrook
Healthcare in June 2019.
• Secured new Urgent Treatment Centre contract
in Watford for our Urgent Care division.
• Secured largest dermatology contract to date
for About Health in Manchester.
• Launched new Insourcing start-up business,
Totally Healthcare, in October 2019, delivering
Insourcing services across the UK and Ireland.
• Continued to provide frontline healthcare
services supporting the NHS to manage
the COVID-19 pandemic.
of registered services rated as ‘Good’
by the Care Quality Commission (CQC)
97%
£0.5m
1.3m
maiden dividend
calls to our 111 service (pre-COVID-19)
01
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT What we do
DELIVERING CARE ACROSS
THE UK AND IRELAND
OUR DIVISIONS
URGENT CARE
Supporting people to access the most
appropriate care quickly and close to
home. We do this by using our expertise
and our people focused commitment.
PLANNED CARE
Providing access to services locally
for outpatient and physiotherapy.
Assisting with ensuring patients access
the right level of care by delivering
referral management services.
INSOURCING
Reducing waiting lists in local hospitals
by working with the very best clinicians
and clinical teams while designing
services to meet local needs.
Revenue
Revenue
91.1%
£96.5m
£8.4m91+
92+
Find out more on page 10
Find out more on page 11
(2019: £69.7m)
(2019: £8.4m)
7.9%
Revenue
1.0%
£1.0m
991
Find out more on page 12
(2019: N/A)
02
Totally plc Annual Report for the year ended 31 March 2020STRATEGIC REPORTN
8
N
9
N
Our strategic roadmap
ADDRESSING THE CHALLENGES
OF HEALTHCARE DEMAND
OUR MISSION
To be a high-quality partner of choice to the NHS
and Healthcare sectors across the UK and Ireland.
OUR VISION
URGENT CARE
PLANNED CARE
INSOURCING
Delivering urgent care services
across England in partnership with
the NHS. Our services include:
• NHS 111
• GP Out of Hours
• Clinical Assessment services
• Urgent Treatment Centres
Working in partnership to
provide outpatient and referral
management services to the NHS,
delivering physiotherapy and
podiatry services to patients in
GP surgeries, community centres
and prisons across England.
Reducing hospital waiting lists
in multiple clinical specialities by
delivering bespoke insourcing
solutions delivered in hospitals
across the UK and Ireland.
OUR STRATEGY
Totally plc is currently engaged in delivering a progressive “buy and build”
consolidation strategy within the UK and Ireland’s fragmented healthcare market.
OUR VALUES
Patients are our priority.
We are kind, supportive,
open and honest.
We provide quality care:
safe, reliable, timely.
We do our best: responsible
for our actions, learning from
successes and mistakes,
avoiding a blame culture.
We are resourceful:
safe, efficient, innovating.
We work effectively
in teams, across
organisational barriers and
we are mutually accountable.
03
STRATEGIC REPORTAnnual Report for the year ended 31 March 2020 Totally plc Chairman’s statement
EXCELLENT
RESULTS
Subject to shareholder approval at the upcoming AGM the final
dividend will be paid in October 2020.
With the expertise of our leadership teams, we will continue to
ensure our services respond to any changes in demand we receive
and that we support our staff to deliver exceptional services in
partnership with the NHS and other public sector bodies across
the UK and Ireland. Whilst the way we secure new business has
changed, the demand for our services is not expected to diminish.
During the year, we completed the acquisition of Greenbrook
Healthcare, which increased our presence across London in
Urgent Care. You will read throughout this report the progress
that has been made with integrating Greenbrook Healthcare
into our Urgent Care division and harnessing technology will
continue to build to our market-leading position.
The Group also launched its Insourcing business, Totally Healthcare,
which during its first few months of operations secured contracts
across the UK and Ireland delivering bespoke services to reduce
hospital waiting lists. Already its reputation is for delivering
services quickly, efficiently and of high quality to every patient
treated. Of course, these services were put on hold during the
pandemic as all elective healthcare was suspended to focus on
managing COVID-19. Totally Healthcare is now back working
and supporting hospitals plan for how they reduce the waiting
times and waiting lists which have increased during the first
half of 2020. We will continue to invest in this part of the Group
to ensure its growth is supported to respond to the obvious
increased demand.
We all know that cash is a seen as a barometer of the success
of any business and we reported £8.9m cash at the bank at year
end, an accurate reflection of the efforts of all our support
teams to ensure we operationally deliver across the business.
All of this has been achieved during the most testing times which
reflects the outstanding commitment and expertise of everyone
across the Group for which I commend them. We must also thank
our investors for their continued support which enables us to
continue to deliver our strategic intentions of becoming a partner
of choice for the delivery of healthcare services across the UK.
Bob Holt OBE
Chairman
14 July 2020
The year ended 31 March 2020 was a good year for Totally plc
delivering profit before depreciation and amortisation during
times of unrivalled political instability which included BREXIT
and a General Election, followed by the worldwide pandemic of
COVID-19 which has impacted on every person and every business.
Totally plc’s strategy has always been to support the NHS to manage
the pressures and demands placed upon healthcare services. The
COVID-19 pandemic is no exception, and everyone at Totally has stood
shoulder to shoulder with the NHS and delivered patient-facing
services throughout this period and continues to do so. At the
time of writing, we are still very much in a period of uncertainty
as everyone works together to ensure services are robust and
ready for any second wave of demand. What is very clear to the
Board of Totally plc is that our strategy has been, and continues
to be, correctly focused during these unprecedented times.
While we expect the business to grow in 2021 and beyond, due
to current run rates and new contract wins, the timing of new
tenders, which is a key part of our growth plans, remains uncertain
due to the COVID-19 pandemic and its impact on the NHS. We
are therefore unable to give firm guidance at this stage on our
growth expectations for the current financial year and the Board
has considered it appropriate for market forecasts to be withdrawn
at this time. The medium to long-term outlook and trajectory of the
business however remains unchanged. Shareholders should
also be pleased that we expect continued growth in operating
cash flow and the Board therefore remains committed not only
to the payment of dividends but also in continuing with our
progressive dividend policy. Accordingly, the Board is pleased
to propose a maiden final dividend of 0.25 pence per share
taking the total dividends for the year to 0.50 pence per share.
Our journey: Progressive buy and build strategy
2016
2017
2019
Mar
Jun
Nov
Oct
Jun
Oct
Premier Physical Health
(Planned Care)
About Health
(Planned Care)
Optimum Healthcare
Services (Planned Care)
Vocare
(Urgent Care)
Greenbrook Healthcare
(Urgent Care)
Totally Healthcare
(Insourcing) launched
04
Totally plc Annual Report for the year ended 31 March 2020STRATEGIC REPORT Chief Executive Officer’s review
BUILDING
PARTNERSHIPS
Introduction
I am pleased to report excellent progress across the Group with
a strong set of results during a year when we saw many external
challenges including the COVID-19 pandemic which impacted
all of our businesses towards the end of the reporting period.
Our management team has seized every opportunity presented
to them to strengthen our market position and support the
delivery of healthcare services across our three divisions.
Demand for our services continues to be strong, on the back of our
reputation for the delivery of high-quality services. 31 out of 32
of our registered services with the Care Quality Commission (“CQC”)
are rated as Good, which is an excellent position to grow from,
and it has been pleasing to see continuing improvement in our
CQC ratings reflecting the high-quality care we provide.
Our three distinct business divisions, Urgent Care, Planned Care
and Insourcing provide a portfolio of services across the UK and
Ireland built on the expertise and commitment of our people,
ensuring the patients we treat receive the highest quality of care
quickly and efficiently. We work in partnership with healthcare
organisations across the UK, supporting them to manage
demand for services.
Whilst we expect the business to grow during 2020/21 and the
medium to long-term outlook for the business remains unchanged,
we are unable to give clear guidance at this stage of the impact
of COVID-19 for the current financial year and as such the Board
has resolved to withdraw market forecasts at this time. Each of
our divisions has been affected in different ways by the COVID-19
pandemic. Despite this, the demand for many of our services
remains strong. COVID-19 has though inevitably resulted in
delays being encountered with the NHS awarding tenders, and
there has been an impact on the near-term visibility for growth,
particularly in Planned Care.
We continue to support the NHS by working on the frontline
delivering services to manage the demand from the pandemic
but also respond to the need to reduce waiting times and waiting
lists due to the suspension of elective healthcare services.
Of course, our results demonstrate the significant progress we
have made, regardless of external forces. Including the largest
to date within our Planned Care division to deliver dermatology
outpatient services across Manchester. In addition, we have
continued to secure a number of vital contract extensions in both
Urgent Care and Planned Care which underpin our foundations
for continued growth - in excess of £20m of contract extensions
were secured in the period under review.
Building on our strategy
During the year, we have focused on delivering services across the
Group that are sustainable and reactive to changes in demand.
• High-quality has to be at the centre of everything we do.
• Our reputation is built upon this core requirement.
• Geography: during the year, we have successfully expanded
our footprint across the UK and Ireland and are now delivering
services across England, Scotland, Wales, Northern Ireland
and the Republic of Ireland.
• Diversification across our divisions: ensuring we deliver models
of care across all areas of high demand in the healthcare sector
and that our divisions support each other by “cross-selling”
services to both existing and potential new customers.
• Learning from everything we do, both positive and negative,
and ensuring we stay ahead of our competition with our
approach to disrupting care models and delivering real
tangible benefits.
• Supporting our people and investing in them as they are
at the core of what we do.
The future
I would like to re-emphasise my confidence in the team of people
we have and their ability to grow the business organically and
via acquisitions, as well as continually reviewing and developing
the range of services we offer.
We are positioned to further build on our market-leading positions
in all of our divisions. Building on our strong relationships with our
commissioners and supporting government bodies to proactively
manage the demands placed on healthcare services during
unprecedented events such as the recent COVID-19 pandemic
when we experienced major increases in demand for our services,
specifically in NHS 111, we were able, with the dedication of our people,
to stand shoulder to shoulder with other healthcare professionals,
and deliver services 24/7 across England supporting everyone by
providing the high-quality services we are known to deliver.
I look forward to updating you further as we continue to expand
our services across the UK.
05
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT Chief Executive Officer’s review continued
STRATEGIC REPORT
Focused for growth
Our vision is to become the partner of choice to the NHS
and healthcare sectors across the UK and Ireland.
It is by continually investing in our strategy that we aim to
deliver strong growth, both organically and through acquisition.
To deliver this, we focus on key areas:
• Service offering differentiation.
• Unlike many of our competitors, we benefit from having
expertise and experience in our leadership teams that allow
us to continually expand the range of services we provide
and expand our footprint across the UK and Ireland.
• Do what we say we are going to do – we place patient care at
the heart of every decision we make. Doing things right the
first time is the most effective and efficient way of delivering
the best services possible. Our solid reputation that has
been built over many years acts as a catalyst, attracting the
best people into our business.
• Delivering excellence – we always aim to deliver services on
terms that benefit both parties. This means that through
continual improvements and commercial management we
continually review and improve. Our disciplined approach
to how we do business enables us to contribute at all levels
across the healthcare spectrum due to the respect we have
earned with our commissioners and healthcare policymakers.
Our strategy remains to become the
partner of choice for the NHS and
other healthcare bodies to respond
to increases in demand for services
whatever the cause may be.
How we changed the way we work during 2019
Since acquiring Greenbrook Healthcare in June 2019, we have
taken the opportunity to review our care delivery models in
our Urgent Treatment Centres (“UTCs”) across the country
to ensure we retain our competitive advantage to remain
the largest independent provider of UTCs across England.
This has involved a critical review of all aspects of the care
pathways across both Vocare and Greenbrook Healthcare
taking the best from both and delivering excellence to the
patients we see. Our staff take pride in what they do and deliver
services with a passion and experience that sets us apart.
Despite the difficult political backdrop, which resulted in the
number of tendering opportunities being significantly reduced
(as a result of BREXIT, General Election, COVID-19), we have
secured new business, and we opened our new Urgent Treatment
Centre in Watford in July 2019 (delayed opening due to COVID-19).
We have retained contracts to continue the delivery of services in
our UTCs, 111 and numerous others services across England.
During the summer of 2019, we embedded our new delivery
structure with the creation of our three delivery divisions.
• Urgent Care – details found on page 10.
• Planned Care – details found on page 11.
• Insourcing – details found on page 12.
In early 2020, it became clear that the UK was about to be
impacted by the worldwide pandemic, COVID-19. Healthcare
providers braced themselves as demand to access services
escalated. Our delivery divisions were all impacted differently.
Urgent Care saw demand increase in excess of 200% above
normal levels for access to its NHS 111 services across the
country. Vocare is our specialist provider of 111 systems
responded accordingly and worked tirelessly, shoulder to shoulder,
with NHS England to coordinate the delivery of core 111
services alongside new services targeted for the management
of COVID-19 and onboarding additional staff to help meet the
unprecedented demand.
Vocare quickly mobilised its Emergency Preparedness,
Resilience and Response processes to ensure every part of the
business and every member of staff were supported during the
ever-changing landscape. This was supported by our Business
Continuity Plan activation across the Totally plc Group to ensure
government guidance was quickly adopted and implemented.
Our UTCs and GP Out of Hours services saw a decline in
demand which meant that staff could be redeployed to where
demand was increasing while still enabling all of our business to
support its people by observing social distancing and isolation
requirements and applying them across all staff groups.
06
Totally plc Annual Report for the year ended 31 March 2020STRATEGIC REPORT The Board and the management
team could not be prouder of the way
our people responded during this
time and we must ensure they know
how valued they are by Totally plc
and the businesses within it.
Our internal mandatory systems for Staff Absence Management
(“SAMS”) was reviewed and adapted to ensure every member
of staff who needed to be absent from the workplace was
supported by a clinician to ensure national guidance and advice
was followed. This involved many changes including:
• Increased working from home with the provision of equipment
to enable this change.
• Increased use of video meetings and clinical consultations.
• Decrease in working from offices where home working
is possible and for those services where office working is
essential changes made to the workplace to meet the latest
advice. This included:
• Increase spaces for work with social distancing.
• Provision of PPE.
• Increased workplace cleaning regimes.
• Provision of more space for essential call centre capacity.
All of the above resulted in a minimum number of staff
being furloughed or made redundant while working through
the pandemic.
Our Planned Care and Insourcing divisions saw contracts being
paused whilst all elective healthcare services were stopped
across the UK with the above processes enabled to ensure
staff were clear about the impact on their roles. During that
period waiting lists and referrals for healthcare services
increased and our businesses became ready to support the
remobilisation of services as required over the coming months.
All of the above ensured that Totally plc as a group of businesses
was able to not only support the NHS during the COVID-19
pandemic, but also demonstrated how to approach service
delivery during such times. Our strategy remains as a partner of
choice for the NHS and other healthcare bodies to respond to
increases in demand for services whatever the cause may be.
The Board and the management team could not be prouder
of the way our people responded during this time and we must
ensure they know how valued they are by Totally plc and the
businesses within it.
Wendy Lawrence
Chief Executive Officer
14 July 2020
07
07
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT Our business model
DELIVERING DIVERSE BESPOKE
HEALTHCARE SOLUTIONS
We support NHS partners by managing demand and delivering
high-quality services to patients across the UK and Ireland.
OUR KEY RESOURCES
WHAT WE DO
People
Our people are our greatest asset.
We aim to use our expertise and our
people’s passionate commitment to
excellence in ways that help individuals
and the businesses we work with.
Services
We are perfectly positioned to
deliver market-leading services
and respond to demands faced
by healthcare providers.
Leadership
Our leadership teams have a vast
knowledge of the services we deliver.
We always work closely with our patients
to understand their needs.
Experience
We have a wealth of experience
delivered over many years providing
a diverse range of responsive,
high-quality services. We work
with commissioners to improve
the local delivery of healthcare.
URGENT
CARE
PLANNED
CARE
INSOURCING
UNDERPINNED BY...
Strategy
Delivering diverse bespoke healthcare
solutions in partnership with the NHS.
Human resources
Our people’s passion and
commitment to deliver excellence.
08
Totally plc Annual Report for the year ended 31 March 2020STRATEGIC REPORT WHAT MAKES US DIFFERENT
1
2
3
4
5
6
Differentiated
Through our service offerings in highly-regulated services.
Experienced leadership
Our management team has extensive experience in
delivering results in our sector and has developed robust
bespoke delivery models to strengthen operations and
ongoing focus on efficiency, savings, safety and quality.
Clients’ needs
Good contract base with recurring revenues across
ever-increasing commissioner portfolio – responsive
to clients’ needs.
Strong performance
A national delivery platform for care across the UK
with robust customer and patient relationships.
Strong brands
Trusted to deliver services to a growing population.
Responsive to commissioner population needs
As evidenced in the recent COVID-19 pandemic, where our
Urgent Care service was commissioned to work to deliver
patient-faced services through this period.
THE VALUE WE CREATE
Clients
We deliver high-quality, efficient
services all within a complex,
highly-regulated system.
Patients
We provide safe, high-quality, quick
access to healthcare services.
People
We offer interesting, challenging
careers in a well-managed, growing
business that provides opportunities
for development and progression.
Shareholders
We deliver services in non-volatile
environments with predictable
recurring revenues and cash flows
underpinned by long running,
stable contracts.
Finance
Financially sound and well-positioned
for further scale to deliver diversity
through the creation of three
distinct divisions.
Stakeholders
Every decision we make is taken with
our stakeholders in mind and what’s
best for them in the long term.
Read more about our stakeholders and
how we engage with them on page 23.
09
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT Our divisions
URGENT
CARE
Andy Gregory
Managing Director
• Working shoulder to shoulder with the NHS
delivering frontline healthcare services.
• Providing the whole spectrum of urgent
care services across England.
What is Urgent Care?
Urgent and Emergency Care (“UEC”) services perform a critical
role in keeping the population healthy.
Both urgent and emergency care services play a specific part
in supporting patients to receive the right care, by the right
person, as quickly as possible. To help relieve pressure on A&E
departments and to ensure patients get the right care, it is
important to understand the difference between urgent
and emergency care:
Emergency: Life threatening illnesses or accidents which
require immediate, intensive treatment. Services that should
be accessed in an emergency include ambulance (via 999)
and emergency departments.
Urgent: An illness or injury that requires urgent attention but is
not a life-threatening situation. Urgent care services include a
phone consultation through the NHS 111 Clinical Assessment
Service, to access pharmacy advice, out-of-hours GP appointments,
and/or referral to an Urgent Treatment Centre (“UTC”). If the
patient is unsure what service is needed, NHS 111 can help to
assess and direct to the appropriate service/s. Our Urgent
Care division provides all of these services working with several
commissioners across England.
Providing a 24/7 urgent care service, accessible via NHS 111,
which can provide medical advice remotely and if necessary,
refer directly to UTCs, GPs (in and out of hours), and other
community services (pharmacy etc.), as well as ambulance and
hospital services, is at the core of our Urgent Care division.
During the COVID-19 pandemic, our Urgent Care division
worked shoulder to shoulder with the NHS delivering all of the
above services as well as delivering new services specifically
designed to support patients presenting with COVID-19
symptoms. We continue to work with the NHS at a strategic
level to ensure everything is done to enable our staff to
continue to provide services safely during the next phase
of the pandemic.
calls to 111 in 2019/20
(pre-COVID-19 impact)
1.3m
18,000+
c. 1.0m
GP out of hours service
visits in 2019/20
patients treated in our
Urgent Care Centres in 2019/20
10
STRATEGIC REPORTTotally plc Annual Report for the year ended 31 March 2020 PLANNED
CARE
Richard Benson
Managing Director
• Ensuring quick access to specialist
elective services.
• Providing high quality services in
community settings, workplaces
and prisons across England.
referrals from primary care
practitioners in 2019/20
65,000+
125,000+
42,000
people treated in our physiotherapy
and podiatry clinics during 2019/20
people treated in our dermatology
clinics across England
What is Planned Care?
Planned Care is often known as elective care. People on a
planned care pathway are likely to start their journey with a visit
to a health professional in primary care, most commonly their
GP. Together they will make a decision about possible options
and discuss whether a referral to another service is needed.
When a referral is made, the appointment may take place in a
hospital setting but, there are also a number of planned care
providers in the community. The businesses within our Planned
Care division provide services in the community, usually within
GP surgeries or community health centres. We also provide
services within workplaces and many prisons across England.
There are lots of specialities that come under the remit
of planned care, including:
• Audiology;
• Cardiology;
• Dermatology;
• Ear, nose and throat;
• Gynaecology;
• Ophthalmology;
• Respiratory medicine;
• Rheumatology;
• Trauma and orthopaedics; and
• Therapies: Physiotherapy, Occupational Therapy and Podiatry.
About Health is a leading specialist provider of dermatology
services and also provide referral management services,
which help to ensure that patients requiring referral into more
specialist services can access those services quickly and
efficiently. Plans to expand the number of specialities that
About Health support is in place.
Our physiotherapy businesses, Premier Physical Healthcare
and Optimum Sports Performance, both provide a range of
services to patients requiring physiotherapy support. This is
provided in a number of settings with face to face services
including GP surgeries, health centres and prisons across
England but also using technology which provides access
to individual care plan and exercise regimes as well as access
to the patient’s physiotherapist. Podiatry services are also
provided by Premier Physical Healthcare.
The demand for planned care services is increasing following
the recent COVID-19 pandemic during which time all planned
care services were put on hold. Waiting lists for planned care
services have risen during this period. Our Planned Care division
is now remobilising services, in line with new COVID-19 guidance
and continuing to work alongside the NHS to ensure patients
can access services quickly and safely.
11
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT Our divisions continued
INSOURCING
Marie Lee
Managing Director
• Launched in 2019.
• Helping reduce patient waiting lists.
• Delivering bespoke, high-quality insourcing
solutions with a reputation for service
excellence for both patients and hospitals.
99%
of the patients we have treated said the
quality of care they received was either
excellent (62%) or very good (37%)
of patients felt they were treated
with dignity and respect
100%
Experts
Led by a passionate experienced team
of insourcing experts
12
What is Insourcing?
Launched in October 2019 Totally Healthcare is part of
Totally plc delivering Insourcing services to hospitals across
the UK and Ireland.
Insourcing is where hospitals subcontract medical services/
procedures to providers who use the host hospitals’ premises
and equipment for service delivery. The care is typically given
out of hours (weekends/bank holidays) when the premises/
equipment is not being used by the hospitals making efficient
use of the infrastructure. Providers bring in their teams of
consultants and nurses and work across specialities such
as endoscopy, ophthalmology, ear nose and throat (“ENT”),
orthopaedics, urology and plastics. Activities include
diagnostics, day-case surgery and outpatient activity.
The main value of insourcing is in helping hospitals reduce long
patient waiting lists which can cause hospitals care quality, operational
or financial problems. In many cases, hospitals are unable to
reduce these lists effectively without external support.
The insourcing market size in the UK and Ireland is estimated
to be £125m to £150m. 4.5m NHS patients are on the waiting
list in England alone, an increase of 0.3m in twelve months, and
approximately 0.6m patients were waiting longer than NHS
England’s 18-week target. Only just over 50% of specialities
in England’s NHS Trusts are meeting the target.
Totally Healthcare’s competitive advantage will stem from
the ability of its key management to sell and deliver bespoke,
high-quality insourcing solutions and build a reputation for
service excellence for both patients and hospitals.
The problems that Totally Healthcare solves
• Many hospitals are unable to meet the increasing demand
for their services, driven by demographic (ageing population)
or other changes to the healthcare system – such as the
recent COVID-19 pandemic, which resulted in the
suspension of all routine/planned care.
• Once waiting lists have built up a hospital may find it extremely
challenging to reduce them again. Demand simply outstrips
the capacity available.
• £1.6bn was spent by the NHS in private hospitals in 2017
(source: Laing & Buisson); there is an opportunity for some of
this work to be done using insourcing instead of outsourcing.
• We will differentiate ourselves from our competitors by
ensuring we deliver the very best level of service quality to
every patient and we will do this by engaging the very best
consultants and clinical support teams from across the
UK and Ireland. Feedback from patients already treated
by Totally Healthcare is excellent and contained within
our website.
STRATEGIC REPORTTotally plc Annual Report for the year ended 31 March 2020 Our strategy and KPIs
OUR STRATEGY FOR GROWTH
CORE MARKET GROWTH
MARKET SHARE GAINS
SYNERGIES
• Increasing demand for
healthcare services.
• Increasing demographic
population.
• Services offering differentiation.
• Competitive advantage to remain
the largest independent provider
of Urgent Treatment Centres
across the country.
• Major increases in demand
for 111 services.
• The delivery of bespoke,
high-quality insourcing
solutions across the UK.
• Strong relationships with
our commissioners and
healthcare providers.
• Supporting Government
bodies to manage demand
on healthcare services.
• Through continual improvements
and commercial management, we
continually review and improve.
PARTNERSHIPS
NEW ACQUISITIONS
STRATEGIC RELATIONSHIPS
• Delivering services across the UK
• Successfully completed
in partnership with the NHS.
• Expanding into new markets,
acquisition of Greenbrook
Healthcare (Urgent Care).
for example healthcare in Ireland.
• Providing insourcing solutions
• We place patient care at the heart
of every decision we make.
to an emerging market.
• Our shareholders and
key stakeholders.
• NHS and healthcare providers.
• Patients and staff.
KEY PERFORMANCE INDICATORS
Revenue
Total of all revenue generated
by the Group.
£105.9m +35.8%
Underlying EBITDA
Adjusted for items as disclosed
in note 8 of the financial statements.
£4.0m +265%
Cash
Total of all cash held
across the Group.
£8.9m +19%
105.9
78.0
4.0
10.2
8.9
7.5
42.5
0.5
4.0
1.1
(0.4)
(1.2)
0.2
1.0
0.4
2015
2016
2018*
2019
2020
2015
2016
2018*
2019
2020
*
15-month period.
2015
2016
2018*
2019
2020
13
STRATEGIC REPORTAnnual Report for the year ended 31 March 2020 Totally plc Clinical quality review
QUALITY AND
RELIABILITY
Gloria Cooke
Clinical Quality Director
For all of us, 2019/20 has been a truly extraordinary year and
providing urgent care through a viral pandemic really tested
all our systems. But the year was about more than COVID-19;
although sometimes it is hard to remember that now.
This review highlights that even in extraordinary times
the improvement journey continues for Totally plc.
Clinical governance overview – Group
Our aim never changes. Right care, first time. If we do that we
reduce waits, reduce complaints and incidents and raise the
number of our patients and clients who are pleased with the
care they have received. Crucially too, we save money – waste
is reduced, duplication of effort goes and instead we spend it
on giving and improving care rather than investigating failings.
Indeed, our reputation with regulators, commissioners and
patients relies on it.
Internal inspections
Led by our Clinical Audit and Effectiveness Manager, our
internal inspection schedule continued throughout the first
three quarters of the year, ceasing only when the pandemic
prevented travel. In that year, further evidence was gained of
how this process successfully drives up quality standards, as
we have seen in step-change improvements in services we
have inspected more than once.
Reassuringly too, these inspection findings have correlated
closely with what CQC inspectors subsequently found at their
inspections, so we know we are on the right track. Therefore,
when pandemic control is gained nationally, we will start
inspections again, but in the meantime, remote models
of measurement will be continued.
14
Safeguarding
Prompted by Group growth, a root-and-branch review of
Safeguarding in Totally plc during last year led to strengthening
of our Safeguarding systems. Ensuring we properly support our
clinicians to safeguard vulnerable patients is a key part of our
responsibilities as providers, and it is one we do not take lightly.
Building on safeguarding foundations we have created so far,
we will embed improved structures across the Group in 2020/21.
Clinical innovation
During 2019, Dean Payne was appointed as our first Director of
Clinical Innovation. Dean is a physiotherapist and entrepreneur
with endless energy for improving healthcare. His academic
background and research and commercial experience perfectly
fit him for this role, which helps keep us at the cutting-edge of
high-quality, sustainable health care.
Dean works within my team which means he has access to
audit, analytical and clinical governance skills - all essential to
efficiently test, evaluate and implement innovative approaches
into practice. Dean works with clinicians and leaders throughout
the Group, harvesting and developing their ideas to design
trials whenever a good business and clinical case can be made.
COVID-19
Of course, in the last quarter of our financial year the pandemic
hit. Working in partnership with the NHS meant that we needed
to nimbly and contribute our range of services to assist with what
quickly became a national crisis. Our 111 services responded
diligently to massively increased demand while clinicians working
face-to-face with patients had to adapt quickly to a whole new
way of working.
We were dealing with a perfect storm: on one hand huge demands
from worried and sick patients and, on the other, an increasing
staff absence rate; either because they were poorly or vulnerable
themselves or were isolating because of symptomatic
family members.
Clinicians and others offered to redeploy to where their skills
were most needed and an appeal to recently retired staff to
return to help with the pandemic was responded to enthusiastically.
Environmental and practice changes were made so we could
make the workplace safer for our telephony and office staff,
home-visiting and Urgent Treatment Centre clinicians alike.
We adopted a nation-wide approach to PPE procurement and
distribution, which ensured good control and maintenance
of availability.
Totally plc Annual Report for the year ended 31 March 2020STRATEGIC REPORT Keeping the frontline staffed was key to maintaining care but
dealing with changing and sometimes complex government
guidance was a major challenge to us. We successfully
addressed this through developing an in-house sickness
absence management scheme which meant that staff were
clinically assessed individually for levels of vulnerability so that
we could redeploy them appropriately and safely.
Stringent sickness absence management, redeployment
options and other “back to work” measures resulted in good
staff attendance and therefore safe service provision overall.
Communications with staff were stepped up with bulletins and
Zoom briefings and staff tell us they felt well supported during
a period of anxiety.
Our COVID-19 Incident Response process continues and will
no doubt influence our work throughout 2020/21 and we
remain alert to national or local prevalence, but we are proud
that throughout the Group our staff have significantly contributed
to the nation’s response so far and tribute should be paid to the
skill, professionalism and massive efforts which were needed
to do this. No systems or processes, however good, can
compensate for a disengaged workforce.
Our clinical governance structure
Infrastructure
Our changed Clinical Governance Structure continues to
ensure strong connectivity and transparency “floor to board”
and the following graphic illustrates how our new
arrangements will provide for that.
CQC status
I’m delighted that our CQC profile continues to improve
year-on-year which I show below:
CQC site status
Good
Requires improvement
Inadequate
2018
50%
35%
15%
2019
90%
10%
–
2020
97%
3%
–
These figures now include About Health (part of our Planned
Care Division), which had its first-ever CQC Inspection during
2019, and Greenbrook Healthcare. I am pleased to report that
About Health’s services were rated as Good and it was great to see
that the hard work and commitment of the team was recognised.
Totally plc
Board
Group Clinical Governance
Board (GCGB)
Clinical Policy
Group
e
r
a
C
t
n
e
g
r
U
e
r
a
C
d
e
n
n
a
P
l
g
n
i
c
r
u
o
s
n
I
Quality
Performance
Committee
Vocare
Greenbrook
About Health,
Optimum SPC,
Premier Physical
Healthcare
Quality
and Safety
Committee
Quality
and Safety
Committee
Totally
Healthcare
Clinical
Governance
Committee
15
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT
Clinical quality review continued
SOME DIVISIONAL ACHIEVEMENTS DURING 2019
INSOURCING
URGENT CARE
We have been delighted with the feedback observed from the
beginning of Totally Healthcare’s services. They have delivered
a high number of cases safely and to an enviable standard
of patient satisfaction.
Patient feedback
“Overall, how would you rate the care you received?”
111 patient feedback
A recent study in 111 has shown very encouraging levels
of patient satisfaction. This is a high-volume service, often
dealing with distressing and/or high-risk care and the helpfulness
and empathy of the staff dealing with patients initially, together
with the clinical care they receive, is very important to get right.
It can be seen from this report that levels of satisfaction are
high and are consistent even during times of significantly
raised throughput in the winter months.
Excellent 62%
Very good 37%
Fair 1%
NHS111 Patient feedback
Did you find the service helpful?
62+
295 completed
questionnaires
Following the pandemic, Totally Healthcare is back to work and
growing, providing more and more care to patients who have
suffered long and worrying waits for care and we will be tracking
those services to provide assurance and drive improvements
wherever we can.
Demonstrating Totally Healthcare’s standards to commissioners
is key to giving assurance of safety for NHS Trusts and crucially
patients, faced with long and lengthening waiting lists.
Dec ’19
Following the pandemic, Totally
Healthcare is back to work and
growing, providing more and more
care to patients who have suffered
long and worrying waits for care and
we will be tracking those services
to provide assurance and drive
improvements wherever we can.
16
Quite or very helpful
Not very helpful
Not helpful at all
No response
Aug ’19
Sep ’19
Oct ’19
Dec ’19
Delivering best practice in medicines management
Because of the known dangers of antibiotic misuse and the
risks that this brings both to us and the next generations, NICE
has set national targets to reduce overall antibiotic prescribing
by 15% by 2024.
This graph shows our success in reducing antibiotic prescription
for Upper Respiratory Tract Infections so far in one region.
Our medical managers, working with our Head of Medicines
Management, worked hard to support clinicians in achieving this
significant result and in this way we have avoided many harmful
and expensive courses of antibiotics being given to our patients.
Antibiotic Prescribing for URTI: Central Region 2019
35%
N
a
t
i
o
n
a
l
l
A
c
t
i
o
n
P
a
n
&
A
u
d
i
t
s
I
n
t
r
o
d
u
c
e
d
22.5%
19.5%
2024 National
Target (20%)
Q1
Q2
Q3
Prescribing habits measured against compliance to NICE
guidelines for Antimicrobial Stewardship 2016 and the target
being to achieve the Government’s “Tackling antimicrobial
resistance 2019–2024 The UK’s five-year national action plan.
Published 24 January 2019” that looks to reduce UK
antimicrobial use in humans by 15% by 2024.
Totally plc Annual Report for the year ended 31 March 2020STRATEGIC REPORT
37
+
1
+
N
Another example of success is in reducing prescription of
certain potentially harmful drugs outside NICE guidelines.
Diazepam is now a controlled drug, largely because of its
addictive potential and that newer, better drugs with fewer
side effects should be used instead. This graph shows
reduction in the use of Diazepam over two years and
demonstrates increased safety for patients.
Diazepam Prescribing: Urgent Care Prescription Rates
Rate = No. of Diazepam Px/No. of attendances X 1000
i
i
i
G
u
d
a
n
c
e
D
s
s
e
m
n
a
t
e
d
&
A
u
d
i
t
s
C
o
m
m
e
n
c
e
d
4.6
2017
3
2
2018
2019
Providing care remotely massively drives efficiency for patients
and staff alike, saving thousands of needless appointments,
inconvenience and travel etc. In this way we have delivered care
to 7,000 + patients so far and were able to provide care
throughout the pandemic.
Number of self-management programmes
assigned to patients during 2019-20
1,000
900
800
700
600
500
400
300
Prescribing habits were measured against NICE guidelines
to reduce the inappropriate prescribing of drugs of potential
misuse. Standards were taken from the following three sets
of NICE guidance and introduced and disseminated to all
clinicians in 2017. These are re-issued every six months in
the clinical briefings. The target was to try and continuously
reduce the overall prescribing.
NICE (2011) Alcohol-use disorders: diagnosis, assessment and management
of harmful drinking and alcohol dependence.
NICE (2015) Generalised anxiety disorder.
NICE (2017) Back pain – low (without radiculopathy.
PLANNED CARE
Our Planned Care division falls into two broad service areas
– therapies (physiotherapy and podiatry) and out-patient care
(predominantly in dermatology).
Delivery and
monitoring
of Remote
Rehabilitation
Programmes
Delivery of
services via a
video channel
Collection and
analysis of
outcome data
via platform
Innovations in therapy
The project to do this is in three phases: the first in which,
after assessment by a physiotherapist, patients are prescribed
a comprehensive rehabilitation plan to be delivered using
patients’ smartphones or tablets and using an online patient
portal for messaging. This allows us to monitor patient metrics
and therefore their progress, as well as providing secure
messaging between the patient and their physiotherapist.
Apr 19
Jun 19
Aug 19
Oct 19
Dec 19
Feb 20
Patients Platform
In the second (present) phase, we are building on phase one’s
success by adding video consultation into the package. This
brings back a missing interactive visual element into the
physio/patient consultation and will enhance care and
effectiveness further.
The third phase begins shortly, during which we will be
evaluating the findings of this project in terms of patient
acceptability, care costs and clinical benefits - all of which will
help us identify its full potentials. Already we have some early
results in terms of Patient-Reported Outcome Measures
(“PROMs”) which show good levels of improvement in
symptom and condition management.
Conclusion
2019/20 might not have been the year I foresaw when I wrote
last year’s report, but it is one in which I believe we have shown
success, resilience and reliability. During a year of very significant
growth for the Group, and a pandemic for the nation, Totally plc
has still managed to further develop the quality and safety of
our services which, I believe is a huge credit to the leaders,
clinicians and support staff who have all contributed and
I thank them all.
Gloria Cooke
Clinical Quality Director
14 July 2020
17
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT
Financial review
WELL POSITIONED
FOR FURTHER SCALE
This improved performance has resulted in a reduction in
provisions relating to performance-related incentives of £1m.
Underlying gross margin is therefore 17.2%.
All of our businesses continually review service delivery models
and this approach has supported us through our response to
the global pandemic. By utilising additional technology,
reducing face to face contact, delivering 111 24/7 and flexing
our services we have continued to deliver sustainable support
to our partners, the NHS.
The Group posted an EBITDA, excluding exceptional costs
relating to the acquisition and impairment of goodwill, of £4.0m.
The loss before tax of £3.4m is stated after an amortisation charge
of £2.8m relating to the intangible value of contracts acquired.
31 March 2020
31 March 2019
Revenue
Gross profit
EBITDA
Exceptional items
Depreciation
Amortisation
Operating loss
Loss before tax
Net assets
Cash
£105.9m
£19.2m
£4.0m
(£2.0m)
(£2.0m)
(£3.1m)
(£3.1m)
(£3.4m)
£34.4m
£8.9m
£78.0m
£12.1m
£1.1m
£0.1m
(£0.6m)
(£2.2m)
(£1.6m)
(£1.8m)
£25.9m
£7.5m
A prudent view of Planned Care growth has been considered
in light of the COVID-19 pandemic. As a consequence, we recognised
an impairment of goodwill relating to this cash generating
unit (“CGU”).
The carrying value of goodwill in relation to this CGU following
impairment is £7.8m.
Exceptional items
Acquisition-related costs
Impairment of goodwill
Revaluation of contingent
consideration
Other exceptional costs
Total exceptional items
Tax (credit)/charge attributable
to exceptional items
Total exceptional items after tax
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
528
1,500
—
—
2,028
(100)
1,928
465
2,000
(2,668)
77
(126)
404
278
Lisa Barter, ACA
Finance Director
The acquisition of a quality urgent care provider, Greenbrook
Healthcare and the creation of a new business in Insourcing
have strengthened the financial performance of the Group.
Growth in revenue was 35.8% year on year at £105.9m, and the
Group generated a loss before tax of £3.4m (2019: £1.8m loss).
Underlying EBITDA increased by 265% to £4.0m. This includes
a £1.6m positive impact relating to IFRS 16.
The Group is cash generative and responded with the
distribution of our maiden dividend in February 2020. The
Board is also proposing the payment of a full-year dividend of
0.25p per share, payable in October 2020. The intention is to
consider future dividend payments based upon the trading
performance of the Group.
Growth in revenues was 35.8% primarily driven by the in-year
acquisition, bringing revenues to £105.9m. New contract wins
were adversely impacted by the uncertainty created by BREXIT
and the General Election. NHS commissioning understandably
paused during this time; nonetheless, the Group was able to
secure extensions of several existing contracts across the
Group, plus a significant new contract for Planned Care,
in Manchester. The new Insourcing business delivered over
£1m in revenues in its first period of trading.
Gross margin improved to 18.1% from 15.5%, largely as a result
of improved performance in the underlying Urgent Care business.
18
Totally plc Annual Report for the year ended 31 March 2020STRATEGIC REPORT
Acquisition costs
The acquisition costs comprised legal, professional and other
related expenditure and amounted to £0.5m (2019: £0.5m).
Cash flow statement
Cash generated from operating activities is positive in the year
reflecting improved underlying profitability of the Group. Cash
outflow relating to the acquisition of Greenbrook, net of cash
acquired was £8.0m. The acquisition was funded by the issue
of share capital, net of expenses of £9.3m.
In June 2019, the Company issued 97,390,939 new ordinary
shares of 10p each. The Company also issued 25,000,000 new
ordinary shares of 10p each as part of the consideration for the
acquisition of Greenbrook Healthcare (Hounslow) Limited and
Greenbrook Healthcare (Earl’s Court) Limited on the same date.
31 March 2020 31 March 2019
Net cash flows from operating
activities
Net cash flows from investing
activities
Net cash flows from financing
activities
Net increase/(decrease) in cash
and cash equivalents
Cash and cash equivalents at the
beginning of the year
Cash and cash equivalents at the
end of the year
£2.9m
(£1.8m)
(£8.6m)
(£0.9m)
£7.1m
—
£1.4m
(£2.7m)
£7.5m
£10.2m
£8.9m
£7.5m
The impact of adopting IFRS 16 on the Consolidated Cash Flow
Statement is to increase operating cash flows and decrease
financing cash flows by £1,744,000 respectively.
Maiden final dividend
We remain committed to the payment of dividends as we
believe this reflects our confidence in the Company’s future
prospects. The Board is therefore pleased to be recommending
to shareholders a maiden final dividend of 0.25p per share.
This, together with the interim dividend of 0.25p per share paid
in February 2020, makes a total dividend for the year of 0.50p
per share. Subject to approval by shareholders at the Annual
General Meeting to be held on 7 September 2020, the final
dividend will be paid on 16 October 2020 to shareholders on
the register as at the close of business on 18 September 2020.
The shares will be marked ex-dividend on 17 September 2020.
Acquisition of Greenbrook Healthcare
On 20 June 2019, the Company completed the acquisition of
the entire share capital of Greenbrook Healthcare (Hounslow)
Limited and the convertible loan note in Greenbrook Healthcare
(Earl’s Court) Limited for a maximum consideration of £11.5m
on a cash-free and debt-free basis with a normalised level of
working capital. The table opposite sets out the adjustments to
the purchase price to reflect a normalised level of working capital
which has resulted in additional consideration payable of £4.7m.
Greenbrook is one of the leading providers of Urgent Care
Centres in London. The company was acquired as part of the
Group’s stated “buy and build” strategy and to bring new and
complementary routes to the existing healthcare services
offered by the Group. Greenbrook’s Urgent Care services
provide synergies with Totally plc’s existing subsidiary businesses,
in particular Vocare, and complements its business model of
providing preventative and responsive healthcare in out-of-hospital
settings to improve people’s health, reduce NHS healthcare
reliance, re-admissions and emergency admissions to hospital.
The assets and liabilities as at 20 June 2019 arising from
the acquisition were as follows:
Property, plant and equipment
Intangible assets:
customer contracts
Right-of-use assets
Trade receivables and
other debtors
Cash in hand
Trade and other payables
Lease liabilities
Onerous contracts
Deferred tax
Convertible loan notes
Net assets acquired
Goodwill
Total consideration
Satisfied by:
Cash
Ordinary shares issued
Carrying
amount
£000
Fair value
adjustment
£000
317
—
Fair
value
£000
317
—
1,425
9,354
—
9,354
1,425
4,712
5,781
(6,964)
(1,425)
—
(34)
(50)
3,762
(763)
—
4,712
— 5,781
(7,727)
— (1,425)
(529)
(1,472)
(50)
10,386
5,850
16,236
(529)
(1,438)
—
6,624
13,736
2,500
16,236
The goodwill is attributable to the knowledge and expertise
of the workforce and the operating synergies that arise from the
Group’s strengthened market position. Any impairment charges
will not be deductible for tax purposes.
Included in the fair value of Greenbrook are provisions for
additional costs or potential costs that existed at the time
of acquisition.
Changes in accounting policies
The Group adopted IFRS 16 with a transition date of 1 April 2019.
The Group has chosen not to restate comparatives on adoption
and, therefore, the revised requirements are not reflected in
the prior year financial statements. Rather, these changes
have been processed at the date of initial application and
recognised in the opening equity balances. Details of the
impact this standard has had are given on page 20.
19
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT
Financial review continued
Changes in accounting policies continued
IFRS 16 provides a single lessee accounting model, requiring
the recognition of assets and liabilities for all leases, together
with options to exclude leases where the lease term is twelve
months or less, or where the underlying asset is of low value.
IFRS 16 substantially carries forward the lessor accounting in
IAS 17, with the distinction between operating leases and
finance leases being retained. The Group does not have
significant leasing activities acting as a lessor.
As a lessee, the Group previously classified leases as operating
or finance leases based on its assessment of whether the lease
transferred substantially all of the risks and rewards of ownership.
Under IFRS 16, the Group recognises right-of-use assets and
lease liabilities for most leases. However, the Group has elected
not to recognise right-of-use assets and lease liabilities for
some leases of low value assets based on the value of the
underlying asset when new or for short-term leases with a
lease term of twelve months or less.
On adoption the Group recognised right-of-use assets at an
amount equal to the lease liability, adjusted by the amount of any
prepaid or accrued lease payments. Lease liabilities are measured
at the present value of the remaining lease payments, discounted
using the Group’s incremental borrowing rate as at 1 April 2019.
The Group’s incremental borrowing rate is the rate at which a
similar borrowing could be obtained from an independent
creditor under comparable terms and conditions.
The impact of adopting IFRS 16 on the Consolidated Statement
of Profit or Loss is to increase profit before exceptional items
by £1,636,000, increase depreciation by £1,509,000 and
increase finance costs by £235,000.
The impact of adopting IFRS 16 on the statement of financial
position can be seen below:
31 March 2019
£000
IFRS 16
£000
1 April 2019
£000
Assets
Right-of-use assets
Prepaid rent
Liabilities
Lease liabilities
—
57
57
—
4,083
(57)
4,026
4,083
—
4,083
4,026
4,026
The impact of adopting IFRS 16 on the Consolidated Cash Flow
Statement is to increase operating cash flows and decrease
financing cash flows by £1,744,000 respectively.
The following table reconciles the minimum lease commitments
disclosed in the Group’s 31 March 2019 financial statements
to the amount of lease liabilities recognised on 1 April 2019.
1 April 2019
£000
Minimum operating lease commitment at 31 March 2019
Previously unrecognised commitments
Less: short-term leases not recognised under IFRS 16
Less: low value leases not recognised under IFRS 16
Less: licences not considered leases under IFRS 16
Undiscounted lease payments
Less: effect of discounting using the incremental
borrowing rate
Lease liability as at 1 April 2019
5,295
151
(71)
(17)
(434)
4,924
(898)
4,026
Lisa Barter, ACA
Finance Director
14 July 2020
20
Totally plc Annual Report for the year ended 31 March 2020STRATEGIC REPORT
Risk management
OUR APPROACH
TO RISK
The process defines responsibilities for risk management and
associated governance arrangements including reporting
arrangements to the Board via divisional leads. It is intended
to promote and embed best practice throughout the Group
and applies to all levels of risk.
This facilitates a dynamic approach to risk management across
the Group, thereby enabling the Board to remain sighted on
the highest-level risks and assure itself that appropriate
mechanisms of control are in place within each division.
To support the development of a proactive risk management
approach and Board Assurance Framework across the
organisation, the Group commits to:
• Embed effective organisational governance arrangements
that respond to strategic change, hold our services to account
for ensuring appropriate patient safeguards regarding quality
safety and patient experience are in place, support high-quality
and effective service delivery and receive assurances in
these respects.
Statement of intent
The Group attaches great importance to the effective
management of risks that may be faced by patients,
members of the public, managers and staff, partners
and other stakeholders, and by the Group itself.
The Group does not, therefore, aim to create a risk-free
environment, but rather one in which risk is considered as a
matter of course and appropriately identified and controlled.
Where possible, the Group will involve stakeholders in its risk
management processes and will work in partnership to identify,
prioritise and control shared risks across the Group – just as we
did during the COVID-19 pandemic response.
The Group is committed to making risk management a core
organisational process and ensuring that it becomes an
integral part of its philosophy, practices and business planning
and that responsibility for its implementation is accepted at all
levels of the Group. It is imperative that a culture of
transparency and honest reporting is promoted and upheld
throughout the Group to ensure risks are properly identified,
evaluated, documented and managed.
The Group is committed to developing a strategy which
provides a robust framework that is underpinned by the concepts
of effective governance and other systems of internal control
that enable the identification and management of both
acceptable and unacceptable risks.
• Ensure that all staff are accountable and responsible.
• To put in place a robust risk management framework that
delivers compliance with regulatory standards across
the Group.
The Group’s financial risk management objectives and exposure
to those risks is detailed in note 24 Financial instruments.
Board
Audit Committee
Divisional Senior Management
Internal
Control
Manager
Compliance
teams
Third party
reviews
Policies, procedures, reporting and review
21
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT Principal risks and uncertainties
PRINCIPAL
RISKS
We have detailed, comprehensive risk management
processes across our businesses which include:
• ISO accreditation processes and accreditations.
• Care Quality Commission reviews. Internal
service reviews to maintain clinical standards.
• Emergency Planning, Resilience and
Response (“EPRR”).
• Business continuity planning (“BCP”).
We continually review our internal systems and
processes and work closely with policymakers
and clients to understand how our marketplace
is changing.
More information on how we manage risk can
be found in our Corporate Governance Report
on pages 27 to 31.
Our major risks and uncertainties identified
at this time are shown opposite.
22
CHANGES IN GOVERNMENT POLICIES
The public sector across the UK and Ireland provides
99% of our revenue, so our business is heavily dependent
on policies adopted by the UK and Irish healthcare bodies.
Diversity across our business delivery models enables us
to manage the risks and focus efforts on those markets
where we can see the opportunity of earning a predictable
return. We also always ensure we are linked strategically
to policymakers, utilising our networks to ensure we are
aware of planned changes and can respond accordingly.
TENDERING FOR NEW WORK
We stay ahead of other providers by continually innovating
and investing in our care delivery models as well as supporting
the national agenda for moving to an outcome based
commissioner process.
POOR CARE DELIVERY
Healthcare is a highly regulated industry and therefore
it is vital that we closely manage the quality of the care
we deliver.
PEOPLE
Our employees are passionate about making a difference
in the healthcare sector. And we know the work of each
one of us contributes to improving people’s lives.
DIGITAL FAILURE
Performance of systems is clearly managed by our digital
team who ensure contingency and business continuity
plans are continually reviewed and adjusted.
FINANCIAL LIQUIDITY
Cash flows are actively monitored by our finance team,
managing liquidity risks while maintaining liquidity
requirements. Exposure to risk is detailed in note 24.
Totally plc Annual Report for the year ended 31 March 2020STRATEGIC REPORT Section 172 statement
Section 172 of the Companies Act 2006 requires Directors to take into consideration the interests of stakeholders and other
matters in their decision making. The Directors continue to have regard to the interests of the Group’s employees and other
stakeholders, including the impact of its activities on communities, the environment and the Group’s reputation when making
decisions. Acting in good faith and fairly between members, the Directors consider what is most likely to promote the success of
the Group and its members in every decision made. The Directors are fully aware of their responsibilities to ensure that the Group
is successful under Section 172 of the Companies Act 2006.
Stakeholders
As a Board we regularly review our principal stakeholders and how we engage with them. The Group views its investors, customers
(commissioners and patients), clinical regulators and employees as its principal stakeholders. All concerns or thoughts of our stakeholders
are discussed at Board level and by direct engagement with stakeholders themselves. Every decision we make is taken with our
stakeholders in mind and what’s best for them in the long term.
Below we highlight how we engage with our stakeholders and the outcomes:
Stakeholder
Type of engagement
Outcomes
Investors
• AIM compliant website with investor relations section
• Proactive investor relations including PR support, use of social
media and direct interactions
• Regular investor meetings and direct calls with our Group CEO
• Stock exchanges announcements, regular press releases
and social media updates
Investors’ opinions and feedback are
considered when discussing strategy,
performance and remuneration policies
Commissioners • A focus across the Group on the needs of our commissioners
• Operational relationships to ensure
with an emphasis on assisting with strategic reviews and
innovation to promote best practice
• Direct engagement with commissioners and healthcare
we work with commissioners on best
practice to deliver optimum healthcare
for local communities
strategists by several Board members and senior colleagues
within our subsidiary companies
• Commissioner feedback is considered
when delivering local services
• Review of care pathways and innovation opportunities through
• Deliver high-quality clinical services
embedded work practices led by Board members
• Maintain strong relationships to ensure we can respond to
any new demands placed on healthcare (such as pandemics)
• Be considered as a preferred partner for the delivery of healthcare
services by contributing to strategic planning forums and
maintaining relationships with healthcare policymakers
• Established robust “Board to floor” emergency planning processes
which can be mobilised quickly
supported by professional corporate
functions (such as recruitment and
finance) to enable delivery
• Ability to respond quickly to new demands
for services (example COVID-19)
Clinical
regulators
• Ensure our recruitment practices reflect best practice to ensure
we can provide safe services and attract and retain the best staff
• Work closely with Care Quality Commission and other healthcare
regulators to ensure we influence strategy and can comply
with all requirements
• Improve our ability to attract the best
staff who understand how to provide safe
clinical services
• Support our staff with training and
audits to ensure delivery of high-quality
clinical services
Patients
• Collect patient feedback to feedback across the organisations
• Seen as a trusted provider of healthcare
to improve what we do
by patients and commissioners
• Respond proactively and professionally to all complaints ensuring
• Ability to support staff and patients for
that learning is taken from each event and embedded into
future practice
positive benefits for both
Employees
• Open forum meetings for all employees with Board members
and other senior managers
• Best practice recruitment processes and remuneration
packages to attract and retain the best staff
• Proactive Learning and Development strategy
• Enables staff to hear from and speak
to leaders across the organisation
for open discussions
• Ensure staff maintain compulsory
registrations and training as required
This Strategic Report was approved by the Board of Directors on 14 July 2020.
Wendy Lawrence
Chief Executive Officer
23
Annual Report for the year ended 31 March 2020 Totally plcSTRATEGIC REPORT Board of Directors
EXTENSIVE
EXPERIENCE
Robert (Bob) Holt OBE
Chairman
Wendy Lawrence
Chief Executive Officer
Lisa Barter, ACA
Finance Director
Gloria Cooke
Clinical Quality Director
Appointment as Finance Director
Lisa was appointed Finance
Director and an Executive Director
in October 2017.
Appointment
Gloria was appointed Clinical
Quality Director in May 2016 and an
Executive Director in December 2017.
Key strengths
Lisa has spent over 15 years leading
finance in the independent healthcare
sector and has been a qualified
accountant since 1996. Lisa has
experience in SME, private equity
and plc settings.
Experience and skills
Lisa is a Charted Accountant and
has extensive experience in leading
finance within the independent
healthcare sector. Her experience
includes M&A activity as well as
extensive involvement in restructuring
and reorganisation of rapidly growing
businesses and start ups. Prior to
joining Totally plc in October 2017,
Lisa held a number of senior finance
roles, most notably within Care UK,
for over ten years. Lisa qualified with
Ernst & Young LLP and has held
finance management roles with both
Hewlett-Packard and Oracle
Corporation.
Key strengths
Gloria has vast experience in
healthcare delivery and leadership.
She left the NHS in 2013 and
continued her practise in large scale
transformational projects as
Programme Director in different
healthcare regions in England and
Wales. She undertook complex service
reviews and fulfilled interim roles as
Director of Nursing, Transformation
Director and Chief Operating Officer
for trusts throughout England.
Experience and skills
Gloria’s long career in healthcare
successfully covered three key areas:
clinical practice; general operational
management and healthcare
transformation. Qualifying as a nurse
in both adult and children’s care Gloria
had a long clinical career in emergency
and paediatric services. Following
MBA qualification, she led a successful
general management career, taking
up ever more senior leadership roles
in large acute trusts throughout the
North and Midlands. During this time
Gloria’s track record of transforming
inefficient teams and services into
high performing ones developed.
Gloria holds non-executive roles
in non-healthcare organisations.
A
N
R
Appointment as Chairman
Bob was appointed Chairman
of Totally plc in September 2015.
Appointment as Chief Executive
Wendy was appointed as Chief
Executive Officer in February 2013.
Key strengths
Bob is an experienced manager
and developer of service businesses.
He has an extensive track record,
spanning over 35 years, of growing
businesses and providing executive
leadership to navigate businesses
through challenging market conditions.
Experience and skills
Bob was latterly Chairman of Mears
Group plc for over 23 years, until his
retirement from the Board in January
2019. Bob is currently Chairman of
Sureserve Group plc and a Director
of several other businesses and was
awarded an OBE in January 2016.
Key strengths
Wendy has over 37 years of senior
healthcare experience within the
NHS, private and US healthcare
systems. She was running her own
successful business before joining
Totally plc and developing the current
strategy to become a leading partner
for delivering high-quality healthcare
services across the UK and Ireland.
Experience and skills
Wendy has successfully led and
delivered numerous complex change
projects. She remains committed to
developing and providing the very best
healthcare services to patients in
every aspect of care delivery.
Wendy continues to work closely with
healthcare policymakers and utilises
her knowledge, skills and experience
to influence the future of healthcare
across the UK and beyond.
She is an experienced executive
coach who supports individuals
and organisations to succeed.
Key to Committees
Audit Committee
Nomination Committee
Remuneration Committee
Chair of Committee
A
N
R
24
GOVERNANCETotally plc Annual Report for the year ended 31 March 2020 Michael Steel
Executive Director
Anthony (Tony) Bourne
Non-Executive Director
Michael Rogers
Non-Executive Director
N
R
A
Appointment to the Board
Michael was appointed as Executive
Director for Totally plc in June 2019
and resigned with effect from
10 July 2020.
Key strengths
Michael has over 20 years of experience
in business growth and the strategic
development of business.
Experience and skills
Michael co-founded Greenbrook
Healthcare in 2007 and as CEO led
the growth and development of the
company. Upon completion of the
acquisition by Totally plc in June
2019, Michael was appointed to the
Board of Totally plc and took on the
Executive Director role of Chief
Operating Officer for the Urgent
Care and Planned Care divisions.
Prior to Greenbrook Healthcare,
Michael spent 14 years in strategy
consulting as a partner for Roland
Berger Strategy Consultants and as
a project manager for Booz Allen &
Hamilton where he focused on
growth and strategy. He also founded
and built his own 30-person consulting
firm which was successfully sold to
Roland Berger. Michael has an MBA
from INSEAD business school and a
Master’s degree in Economics from
Oxford University.
Appointment to the Board
Tony was appointed as a Non-Executive
Director for Totally plc in October 2015.
Key strengths
Tony has extensive business,
healthcare and finance experience.
Experience and skills
Tony is currently a Non-Executive
Director of Barchester, one of the
UK’s largest operators of residential
care homes, and Spire Healthcare
Group Plc, one of the largest private
health groups in the UK, and London
Stock Exchange-listed company. He is
also Chairman of CW+ (formerly the
Chelsea and Westminster Health Charity),
one of the largest NHS charities and,
before that, was Chief Executive of
the British Medical Association.
Previously Tony was in investment
banking for over 25 years, as a partner
at Hawkpoint, an independent corporate
finance advisory firm, and as the
global head of the equities division
and a member of the managing board
of BNP Paribas. Tony has also spent
nine years as a Non-Executive Director
at Southern Housing Group and at
Scope, one of the UK’s largest charities
which focuses on cerebral palsy.
Appointment to the Board
Michael was appointed as
Non-Executive Director for Totally plc
in December 2015.
Key strengths
Mike has extensive business and
healthcare delivery experience.
Experience and skills
Michael has over 30 years’ experience
in healthcare services and social care
services provisions. From April 2007
to June 2017, he was a Non-Executive
Director of Mears Group plc, the
provider of support services to the
social housing and care sectors in the
UK, which is listed on the main market
of the London Stock Exchange. In 1976,
Michael was appointed as Managing
Director of the British Nursing
Association. In 1988 he became the
Chief Executive of Nestor BNA plc
when the group floated on the
London Stock Exchange. Michael
remained here until 1996, prior to
founding Careforce group plc in 1999,
which floated on AIM in 2004. Careforce
Group plc completed a number of
acquisitions to become one of the
UK’s leading domiciliary care providers,
prior to its acquisition by Mears in
2007, following which Michael joined
the Mears Board until his resignation.
He is currently Chairman of Eastern
Fostering Services Ltd, a provider of
foster care services in East Anglia.
Diversity, independence
and experience
Gender
Tenure
Male 58%
Female 42%
1–4 years 58%
5–8 Years 42%
4258
5842
5842
5020
Executive 58%
Healthcare 50%
Sector experience
Board composition
Non-Executive 42%
Business 20%
Finance 20%
Governance 10%
25
Annual Report for the year ended 31 March 2020 Totally plcGOVERNANCE+
20
+
10
L
L
L
L
Senior Management
HIGHLY SKILLED
MANAGEMENT
Richard Benson
Managing Director
Planned Care
Andy Gregory
Managing Director
Urgent Care
Marie Lee
Managing Director
Insourcing
Appointment
Richard was appointed Managing
Director in August 2019.
Appointment
Andy was appointed Managing
Director in March 2020.
Appointment
Marie was appointed as Managing
Director in September 2019.
Key strengths
Richard is skilled in developing and
leading high performing teams in the
health sector. He founded and grew
a successful healthcare business and
brings strategic leadership to the
task of consolidating and growing
the businesses within the Planned
Care division.
Experience and skills
Richard has almost 30 years’
experience in the NHS and
independent healthcare sector. He
has held Board-level positions in NHS
commissioning organisations and
was a founding Director of About
Health, which was acquired by Totally
plc in 2016. He has previously been an
Associate of the NHS Modernisation
Agency and a faculty member of
Birmingham University’s Health
Service Management Centre.
Key strengths
Andy is an experienced strategic
leader to the NHS and independent
sector and has a track record of
leading large-scale complex change
across healthcare sectors.
Experience and skills
With a career spanning 29 years in
healthcare, Andy has extensive
experience in delivering large
complex change projects as well as
business integration and business
turn-around projects. Andy has an
MBA (Keele University) and has been
through a number of nationally
recognised leadership programmes
and is a Kings Fund Alumni member
and contributor.
Key strengths
Marie has more than 17 years’
Board-level experience of delivering
successful clinical insourcing services
across public sector hospitals
throughout the UK and Ireland.
Experience and skills
Marie was one of the original founders
and CEO of Medinet, a healthcare
insourcing business.
Marie has worked with more than
100 hospitals across the UK and
Ireland, helping to reduce patient
waiting times through the delivery
of cost-effective clinical services.
26
GOVERNANCETotally plc Annual Report for the year ended 31 March 2020 Chairman’s introduction to governance
STRONG GOVERNANCE
FRAMEWORK
Strong corporate governance
is fundamental to the effective
management of the business and
delivery of long-term shareholder
value and is for the wider benefit
of the Company, its employees,
customers and suppliers.
I am pleased to introduce the Company’s 2020
Corporate Governance Report.
Strong corporate governance is fundamental to the effective
management of the business and delivery of long-term
shareholder value and is for the wider benefit of the Company,
its employees, customers and suppliers. The Board considers
that the future success of the Company is dependent upon
a commitment to a strong governance framework
throughout the business.
The Company applies the governance principles of the
Quoted Companies Alliance Corporate Governance Code
2018 (“QCA Code”), on the basis that it is the most appropriate
governance code for the Group, having regard to its strategy,
size, stage of development and resources.
The QCA code focuses on ten principles and a set of disclosures.
The details of how Totally plc complies with the principles
that are stated in the QCA code are in the explanations to
follow, within the Board Committee reports and on the
Company’s website at www.totallyplc.com.
Board composition has changed during the year with the
appointment of Michael Steel as an Executive Director,
following the acquisition of the Greenbrook Healthcare
business. Michael resigned post financial year end on
10 July 2020.
Bob Holt OBE
Chairman
14 July 2020
27
GOVERNANCE Corporate governance report
Statement of compliance with the QCA Corporate Governance Code
The Board has adopted the QCA Corporate Governance Code and in the table below the Board sets out how it complies
with the principles of the Code.
Deliver growth
Governance principles
Compliant
Further reading
1.
Establish a strategy and business
model which promote long-term
value for shareholders
Pages 2 – 13 and 29
https://www.totallyplc.com/about-us/
our-strategy
2.
Seek to understand and
meet shareholder needs
and expectations
3.
Take into account wider
stakeholder and social
responsibilities and their
implications for
long‑term success
4.
Embed effective risk
management, considering both
opportunities and threats,
throughout the organisation
5.
Maintain the Board as a well
functioning, balanced team
led by the Chair
6.
Ensure that between them the
Directors have the necessary
up to date experience, skills
and capabilities
7.
Evaluate Board performance
based on clear and relevant
objectives, seeking
continuous improvement
8.
Promote a corporate culture
that is based on ethical values
and behaviours
9.
Maintain governance structures
and processes that are fit for
purpose and support good
decision making by the Board
10.
Communicate how the Company
is governed and is performing
by maintaining a dialogue
with shareholders and other
relevant stakeholders
Pages 27 – 31
https://www.totallyplc.com/investor-relations/
corporate-governance
Pages 23 and 29
https://www.totallyplc.com
Pages 21, 22 and 29
Pages 24, 25, 29 and 30
https://totallyplc.com/about-us/
board-and-management
Pages 24, 25 and 30
https://totallyplc.com/about-us/
board-and-management
Page 30
Pages 2 – 13 and 27 – 31
https://www.totallyplc.com/about-us
Page 31
https://www.totallyplc.com/investor-relations/
corporate-governance
Pages 1 – 39
https://www.totallyplc.com/investor-relations/
corporate-governance
https://www.totallyplc.com/investor-relations/
reports-documents
Maintain a dynamic
management
framework
Build trust
28
GOVERNANCETotally plc Annual Report for the year ended 31 March 2020 Principle 1 – Establish a strategy and business model
which promote long‑term value for shareholders
Totally plc is a leading out-of-hospital healthcare provider.
The business operates through three delivery divisions,
the third of which was started during the year:
• Urgent Care – Urgent Treatment Centres (“UTCs”) – managing
the “front door “ to A&E Departments, NHS 111, GP Out of
Hours services and Clinical Assessment Services (“CAS”)
telephonic access to multidisciplinary teams of clinicians.
• Planned Care – Community Outpatient Services including
specialist dermatology and cardiology, Referral Management
Systems (“RMS”) in partnership with the NHS to improve GP
referrals, physiotherapy – full musculoskeletal services to GP
surgeries, health centres, prisons and gyms – and Health
Coaching supporting long-term condition management
and early discharge services.
• Insourcing – Totally Healthcare was established in October
2019 to target the insourcing market in the UK and Ireland,
and to assist with the reduction of patient waiting lists.
The Company’s focus remains on helping patients to avoid
hospital and protecting the A&E department.
Totally’s strategy is explained fully within our Strategic Report,
which is contained within pages 1 to 23 of this Annual Report.
The Principal Risks and Uncertainties to the business are
detailed on pages 21 and 22 of this Annual Report.
Principle 2 – Seek to understand and meet
shareholder needs and expectations
The Board recognises the importance of active shareholder
dialogue with both institutional and private shareholders, and
this is led by the Chairman and the Chief Executive Officer.
The detail of how the Company addresses these matters is
fully contained within the Principle 2 note in the Corporate
Governance section of the website at www.totallyplc.com/
investor-relations/corporate-governance.
Following both the annual and interim results announcements,
meetings are held with analysts, private investors and
institutional investors of the Company. The Company’s
website also has details of public announcements, Annual
and Interim Reports and investor presentations.
The Annual General Meeting (“AGM”) of the Company remains
a key focus on allowing the Directors to meet with shareholders
and to provide an opportunity to give an update on the Company’s
performance. It also gives shareholders the opportunity to ask
questions of the Directors, either in the formal AGM proceedings
or informally after the event.
Principle 3 – Take into account wider stakeholder
and social responsibilities and their implications
for long‑term success
The Board is conscious that its long-term success depends
upon its interaction with its wider stakeholder base – patients,
commissioning groups, staff, regulators and the wider community.
Totally plc operates in a heavily regulated sector where its
work is subject to independent audit and review by Clinical
Commissioning Groups and the Care Quality Commission (“CQC”).
Formal or informal feedback is encouraged by staff and from
other stakeholders through, amongst other routes, the Contact
Us section of the Company website at www.totallyplc.com.
Regular staff dialogue is maintained through Totally News –
a Company-wide newsletter and regular staff meetings.
Principle 4 – Embed effective risk management,
considering both opportunities and threats
throughout the organisation
Details of the risks and uncertainties faced by the Group,
and actions to mitigate risk can be found in the Principal Risks
and Uncertainties section of this Report and Accounts
on pages 21 and 22.
The business operates in a highly regulated market with activities
complying to NHS operational and administrative procedures.
Risk management is a core focus of the Board, and this is reviewed
at each Board meeting. Detailed feedback is received from each
operating subsidiary, together with external regulatory bodies,
at these meetings. Formal risk registers for the business are
reviewed regularly by the Board. Operational risk and any newly
identified risk to the business is also considered.
Regular dialogue is maintained with Commissioning Groups,
the CQC, NHS England and with our insurers. The Company
maintains appropriate levels of insurance cover.
Principle 5 – Maintain the Board as a well functioning,
balanced team led by the Chair
The Board, led by the Chairman, is responsible for the overall
management of the Group including the approval and
implementation of the Group’s objectives and strategy, budgets,
operational performance along with the maintenance of sound
internal control, corporate governance and risk
management procedures.
The Board of Directors comprises of a Non-Executive Chairman,
two further Non-Executive Directors and four Executive Directors.
All Non-Executive Directors are considered to be independent.
Details of the Directors, including brief biographies, Committee
membership, key strengths and experience, skills and qualifications,
can be found on pages 24 and 25 of this Annual Report.
The work of the Board is supported by Audit, Remuneration
and Nomination Committees, membership of which is made
up of the Non-Executive Directors. There is a formal Schedule
of Matters reserved for the Board and this along with the
Board Committee terms of reference may be found on the
Company’s website at www.totallyplc.com/investor-relations/
corporate-governance.
29
Annual Report for the year ended 31 March 2020 Totally plcGOVERNANCE Corporate governance report continued
Principle 5 – Maintain the Board as a well functioning,
balanced team led by the Chair continued
The table below summarises the membership of the Board,
the Board Committees and the attendance record of
the Directors.
The Directors are mindful of the need to maintain gender
and equality balance to the Board.
Sector-specific training for the Directors is maintained through
regular business updates from the Executive Directors and
briefings from external advisers.
Board
scheduled
meeting
Audit Remuneration Nomination
External professional advice has only been sought for routine
business matters.
Director
Executive Directors
Wendy Lawrence
Lisa Barter
Gloria Cooke
Michael Steel1
Non-Executive Directors
Bob Holt
Michael Rogers
Tony Bourne
6/6
6/6
6/6
4/4
6/6
5/6
5/6
—
—
—
—
3/3
3/3
—
—
—
—
—
2/2
—
2/2
—
—
—
—
2/2
—
2/2
1.
Michael Steel was appointed to the Board on 20 June 2019 and resigned
on 10 July 2020.
All Directors are required to commit sufficient time to their
respective roles to discharge their duties adequately.
Directors retire by rotation and are subject to re-election
at the AGM of the Company.
The Board has considered the independence of the
Non-Executive Directors and the table below sets out their
appointment date and those considered to be independent.
Each of the Directors is subject to either an Executive Service
Agreement or a letter of appointment.
Directors
during
the year
Independent/
Not Independent
Date of
appointment
Role
Independent
15 September
2015
Bob
Holt
Michael
Rogers
Tony
Bourne
Non-Executive
Chairman
Non-Executive
Director
Non-Executive
Director
Independent
Independent
Wendy
Lawrence
Chief Executive
Officer
Not
Independent
Finance
Director
Not
Independent
7 December
2015
5 October
2015
15 February
2013
23 October
2017
Clinical Quality
Director
Not
Independent
4 December
2017
Executive
Director
Not
Independent
20 June
2019 (resigned
10 July 2020)
Lisa
Barter
Gloria
Cooke
Michael
Steel
Principle 6 – Ensure that between them the
Directors have the necessary up to date experience,
skills and capabilities
The Board considers that there is currently an appropriate
balance between sector, financial and public market skills and
experience at Board level. Directors’ biographies including
details of their key strengths and experience and their skills
and qualifications can be found on pages 24 and 25 of this
Annual Report.
30
Principle 7 – Evaluate Board performance
based on clear and relevant objectives,
seeking continuous improvement
While it had previously been agreed to undertake an internal
Board evaluation process during the financial year, the
considerable work necessary to achieve the acquisition and
integration of the Greenbrook Healthcare business, along with
the changes to the plc Board and Senior Management team as
a result of that acquisition, meant that the evaluation was deferred.
The Board has agreed that a formal external Board evaluation
will be undertaken during the current year. This will take into
account both the requirements of the QCA Corporate Governance
Code (2018) and the Financial Reporting Council’s Guidance on
Board Effectiveness.
There is a performance evaluation undertaken of all Directors
being proposed for re-election to ensure their performance
continues to be effective and in the case of Non-Executive
Directors that their continuing independence and time
commitment to the role is demonstrated.
Principle 8 – Promote a corporate culture
that is based on ethical values and behaviours
Page 3 of the current Annual Report sets out Totally’s mission
and values, all of which underpin how the Group is run. This
culture is consistent with the Company’s strategy, further
details of which are set out within the Strategic Report section
of this Annual Report, on pages 1 to 23.
Given the nature of the Group’s activities, Totally plc is subject
to significant external scrutiny from Commissioning Groups
and Regulators. The business is fully compliant with all
NHS requirements for governance, information security
and quality management.
The Company has in place:
• Formalised whistleblowing procedures for staff, contractors
and agency staff to raise concerns relating to danger, fraud
or other illegal or unethical conduct.
• A Group Anti-Slavery and Human Trafficking policy
statement in relation to the Modern Slavery Act 2015.
• A Company Code of Conduct.
• An Anti-Corruption Policy relating to compliance with the
Bribery Act 2010.
• Measures to take appropriate actions to comply with the
provisions of the Market Abuse Regulations together with
a Share Dealing Policy.
• The Group has complied with the provision of statutory
information relating to the Gender Pay Gap legislation and
Payment Practices regime.
GOVERNANCETotally plc Annual Report for the year ended 31 March 2020 Principle 9 – Maintain governance structures and
processes that are fit for purpose and support good
decision making by the Board
The Company Secretary works closely with the Chairman and
the Chairman of the various Board Committees to ensure that
Board procedures, including setting agendas and the timely
distribution of papers are complied with and that there are good
communication flows between the Board and its Committees,
and between senior management and Non-Executive Directors.
There is a formal agenda at each Board meeting which includes
an operational update from the Chief Executive Officer,
financial updates from the Finance Director and a detailed
clinical quality update, including any interface with regulators
from the Clinical Quality Director. The reports from the
Executive Directors cover all business units within the Group
and also covers new business opportunities. Strategic issues
are dealt with at each Board meeting by the Chairman.
Within the annual calendar of Board meetings, there is normally
an annual budget presentation at which the Senior Management
team presents its budget for the forthcoming financial year.
The Non-Executive Directors are encouraged to attend visits
to the individual operating businesses to discuss performance
and other issues with the management teams.
During the course of the year, other matters considered by the
Board have included annual and half-year results announcements,
AGM resolutions, interactions with NHS England and the CQC,
reports from the Group Clinical Governance Board, principal
risks and uncertainties, shareholder communications and
management incentivisation.
Board papers are circulated to the Directors at least three clear
business days in advance of the meetings to enable proper
consideration of the content of the papers.
The Chairman maintains regular contact with the
Non-Executive Directors outside of formal Board meetings.
The roles of all Board members are as detailed below:
Position
Responsibilities
Name
Non-Executive
Chairman
Bob Holt
Chief Executive
Officer
Wendy
Lawrence
Leads the Board and assists
the Chief Executive Officer in
developing Company strategy.
Ensures an effective link between
shareholders and the Board.
Assists the Chairman to develop
strategies. Implements policies
and strategies agreed by the
Board and manages the business.
Finance Director Lisa Barter Develops, implements and
monitors financial strategy
of the business.
All Directors have access to the support and advice of the
Company Secretary as required. Directors are also able to take
independent professional advice at the Company’s expense in
the furtherance of their duties where considered necessary.
Position
Responsibilities
Name
Group Company
Secretary
John Charlton Provides guidance on all matters
of corporate governance.
Ensures a good flow of
information within the Board
and its Committees.
Board Committees
There are three Board Committees, all with formally delegated
powers – an Audit Committee, a Remuneration Committee
and a Nomination Committee. All are chaired by and comprise
of the Non-Executive Directors.
The terms of reference for all Board Committees are reviewed
regularly and can be found on the Company website at
www.totallyplc.com/investor-relations/corporate-governance.
Committee Chairs attend the Company AGM and are available
to answer any questions from shareholders regarding the
activities of the Committees.
Principle 10 – Communicate how the Company
is governed and is performing by maintaining a dialogue
with shareholders and other relevant stakeholders
The Board maintains an active dialogue with institutional
and private shareholders and employees – both employee
shareholders and others.
The Company’s website includes a specific Investor Relations
section containing all RNS announcements, share price
information and details of significant shareholders, corporate
governance and annual documents are available for download
at www.totallyplc.com/investor-relations.
The website also provides details for contacting the Company
on any issues.
The AGM remains an important opportunity for the Board to
engage with shareholders. Formal questions may be tabled to
the Board during the AGM, or asked informally in conversation
after the AGM.
There is feedback to the full Board of any shareholder
interaction at each Board meeting.
This year’s AGM will be held on Monday 7 September 2020,
and full details of venue and resolutions proposed may be
found in the Notice of Meeting enclosed with these accounts
or on the Company website.
Approved by order of the Board.
Clinical Quality
Director
Executive
Director
Gloria Cooke Develops, implements and
monitors clinical quality and is
Executive lead for safeguarding.
Bob Holt OBE
Chairman
14 July 2020
Michael Steel Assists CEO with the review
of strategic matters and
operational delivery.
Non-Executive
Directors
Mike Rogers/
Tony Bourne
Provide constructive challenge
to the Executive Directors.
31
Annual Report for the year ended 31 March 2020 Totally plcGOVERNANCE Report of the Nomination Committee
Membership of the Nomination Committee
and activities during the year
The Nomination Committee comprises of Tony Bourne,
Non-Executive Director and Bob Holt, Non-Executive Chairman.
Both served during the year. Tony Bourne became Chairman of
the Committee on 24 October 2017. Details of attendance records
during the period can be found on page 30.
In June 2019 Totally plc completed on the acquisition of
Greenbrook Healthcare and following the acquisition,
Michael Steel, formerly Chief Executive of Greenbrook
Healthcare, joined the Board as an Executive Director. The
Board, therefore, comprises of four Executive Directors and
three Non-Executive Directors.
Given the transformational nature of the Greenbrook acquisition
for Totally’s position within the Urgent Care market, the Nomination
Committee reviewed the incentivisation of the key Executive
Directors of the enlarged Group to ensure that they were aligned
with the creation of shareholder value. A new long-term incentive
plan (“LTIP”) was put in place for the Chief Executive Officer, Finance
Director, Clinical Quality Director and the Executive Director in
June 2019. Any award is subject to share price growth hurdles
and has a three-year vesting period. Full details are contained
within the Admission Document, which may be found at
www.totallyplc.com/investor-relations/reports-documents.
The Board acknowledges that diversity extends beyond the
boardroom and supports the management efforts to building a
diverse organisation. When considering the optimum composition
of the Board, it is believed all appointments should be made on
merit while ensuring an appropriate balance of skills and
experience within the Board.
The work of the Committee during the period has primarily been
in supporting the Executive Directors in their review of Senior
Management positions within the business, both at Group level
and in the Executive management of the operating subsidiaries.
Following the acquisition of Greenbrook Healthcare, the work
that was already underway with the integration of the Vocare
business and the creation of Totally Healthcare in October 2019,
the Board confirmed the strategy of operating through three
delivery divisions – Urgent Care, Planned Care and Insourcing.
Senior appointments across all three delivery divisions were
overseen by the Nomination Committee, following
recommendations by the Executive Directors.
As reported previously, the Committee had considered implementing
the process of a formal Board evaluation, and it was agreed that
initially this would be undertaken through an internal process led
by the Non-Executive Directors. This process was halted following
the change in Board structure as a result of the Greenbrook
acquisition. The Board has however agreed that an external Board
evaluation process will be commenced in the current year, given
that the Board structure is stable. Full details will be reported in
future Nomination Committee reports.
Tony Bourne
Chairman of the Nomination Committee
14 July 2020
Tony Bourne
Chairman of the Nomination Committee
The key responsibilities of the
Nomination Committee are to:
• Review the structure, size and composition
of the Board, including the skills, knowledge,
experience and diversity of Directors.
• Develop a strategy for succession planning
for both Directors and other senior Executives.
• Identify and nominate for approval by the
Board candidates to fill Board and other
senior vacancies.
• Keep under review the leadership needs
of the Company.
The focus of the Committee during
the coming financial year will be:
• To complete the Board evaluation process.
• To review the Executive/Non-Executive balance
of the Board.
• To review succession planning within
the business.
• To review incentivisation arrangements for
senior management teams within the business.
32
GOVERNANCETotally plc Annual Report for the year ended 31 March 2020 Report of the Audit Committee
Michael Rogers
Chairman of the Audit Committee
The key responsibilities of the
Audit Committee include:
• Reviewing and monitoring the integrity of the
Group’s annual and interim financial statements
and accompanying reports.
• Reporting on the appropriateness of accounting
policies and practices.
• Reviewing and monitoring the effectiveness
of the Group’s internal controls and risk
management systems.
• Reviewing the effectiveness of the Group’s
internal audit process and to approve the
forward audit plan.
• Making recommendations to the Board in
relation to the appointment and removal
of the external auditor.
• Reviewing and monitoring the external auditor’s
independence, objectivity and the effectiveness
of the audit process.
• Reviewing and monitoring the extent of the
non-audit work undertaken by the Group’s
external auditor.
• Reviewing the adequacy and effectiveness of
the Group’s whistleblowing and anti-bribery
policy and procedures.
• Reviewing the Group’s risk
management procedures.
Membership of the Audit Committee and activities
during the year
The members of the Committee are Michael Rogers,
Non-Executive Director who acts as Committee Chairman
and Bob Holt, Non-Executive Chairman. The Committee is
comprised of financially literate members with the requisite
ability and experience to enable the Committee to discharge
its responsibilities.
The Committee met three times during the period. Meetings
are attended by Committee members and, by invitation, the
Finance Director, Senior Management and representatives
from the external auditors. Once a year, the Committee will
meet separately with the external auditors without
management being present.
The Committee’s terms of reference are available to view
at www.totallyplc/investorrelations.
The primary function of the Audit Committee is to assist the
Board in discharging the responsibilities concerning financial
reporting and external and internal controls.
During the period covered by this report, the Committee
undertook the following:
• Reviewed the key accounting considerations and judgements
reflected in the Group’s results for the six-month period
ended 30 September 2019.
• Continued to support the Board with a review of accounting
procedures and policies as part of the integration process
following the Vocare acquisition.
• Supported the Nomination Committee and Board in the
appointments to the new Integrated Finance function
following the acquisition of Vocare. During the course of the
year a Group Central Finance team was established at the
Derby Head Office, following the relocation of the Head
Office from London. This has seen the consolidation of
Finance teams from the various operating subsidiaries
into the centre.
• With the acquisition of Greenbrook Healthcare in June 2019
further consolidation of finance teams was undertaken to
reflect the three operating divisions of the business – Urgent
Care, Planned Care and Insourcing.
• Reviewed and agreed the external auditors’ audit plan in
advance of its audit for the year ended 31 March 2020.
• Reviewed and approved the non-audit assignments undertaken
by the external auditor for the year ended 31 March 2020.
• Reviewed risk management procedures within the business
together with a detailed review of the Group Risk Registers.
• Considered, together with the Board, the principal risks
and uncertainties review.
33
Annual Report for the year ended 31 March 2020 Totally plcGOVERNANCE Report of the Audit Committee continued
A summary of the key risks from the Group Risk Register is
presented to the Audit Committee on a semi-annual basis.
The risks and uncertainties which are judged currently to have
the most significant impact on the Group’s long-term performance
and prospects are set out in the Principal Risks and Uncertainties
section on page 22 of this Annual Report.
Following the year end, the Committee has met to approve
the Group’s Annual Report and financial statements.
Michael Rogers
Chairman of the Audit Committee
14 July 2020
External auditor
RPG has remained as the Group’s auditors for the period
under review. The Board is aware that the effectiveness and
independence of the external auditor is central to ensuring the
integrity of the Group’s published accounts. In line with standard
audit practice, the audit partner was rotated at the start of the
financial year. The Audit Committee took the following steps
to ensure auditor independence was not compromised:
• Reviewed the Group’s relationship with RPG and assessed
the levels of controls and procedures in place to ensure the
required level of independence and that the Group has an
objective and professional relationship with RPG.
• The Audit Committee reviews all fees paid for the audit and
all non-audit fees with a view to assessing the reasonableness
of fees, and any independence issues that may have arisen
or may potentially arise in the future.
Risk management and internal controls
The Audit Committee is responsible for monitoring the financial
reporting process and for reviewing the effectiveness of the
Group’s systems of internal controls. Any system of internal
control is designed to manage, rather than eliminate, the risk
of failure to achieve business objectives. The Board can only
provide reasonable and not absolute assurance against
material misstatement or loss.
There is an established and transparent organisational
structure in place, with appropriate defined authority levels.
Day to day running of the Group is delegated to the Executive
Directors of the Group, who meet with operational and financial
management from each business area on a monthly basis. Key
financial and operational measurements are reported on a
monthly basis and are measured against budget and reforecasts.
The Group maintains a Group Risk Register and individual risk
registers for each business within the Group. These outline the
key risks faced by the Group, including their impact and likelihood
and relevant mitigation controls and actions. The Group and
business unit risk registers are reviewed and updated by
management on a monthly basis.
34
GOVERNANCETotally plc Annual Report for the year ended 31 March 2020 Directors’ remuneration report
Tony Bourne
Chairman of the Remuneration Committee
The key responsibilities of the
Remuneration Committee are to:
• Develop remuneration packages which motivate
Directors and support the delivery of business
objectives in the short, medium and longer term.
• Align the interests of the Executive Directors
with the interests of long-term shareholders.
• Encourage Executives to operate within the risk
parameters set by the Board.
• Ensure that the Company can recruit and retain
high quality Executives through packages which
are fair and attractive, but not excessive.
This is the Directors’ Remuneration Report for the year
ended 31 March 2020. Pages 36 and 37 provide details of each
Director’s pay and benefits in the period to 31 March 2020.
The members of the Committee are Tony Bourne,
Non-Executive Director who acts as Committee Chairman
and Bob Holt, Non-Executive Chairman.
The Committee met twice during the period.
Responsibilities and work of the
Remuneration Committee
The primary function of the Remuneration Committee is to
review the remuneration of the Executive Directors and to
monitor the remuneration of the Group’s Senior Management.
The remuneration strategy and policy for all staff is also
reviewed annually by the Committee.
During the course of the financial year the Committee reviewed
and assisted with the development of the following aspects:
• The acquisition of the Greenbrook Healthcare businesses in
June 2019 led to a further period of review and integration of
roles and responsibilities within the enlarged business and
followed on from the previous work undertaken as a result of
the acquisition of Vocare in October 2017. The Committee
assisted with aspects of the remuneration for the new Executive
and Senior Management roles within the new structure.
• During the year the strategic focus of the business was
developed further to concentrate around three core areas
– Planned Care, Urgent Care and Insourcing. Remuneration
strategies were developed to reflect the new leadership
roles within each of the three divisions.
• Totally Healthcare – the business’ new Insourcing division
was established in October 2019 and the Committee
assisted the Executive Directors with establishing a focused
remuneration strategy for the management team brought
in to develop this part of the business.
• The Committee also oversaw the adoption of the Totally plc
LTIP Plan (Long-Term Incentive Plan) and the awards made
to initial participants. Full details of the LTIP Plan Rules, awards
made and performance conditions can be found from page 126
of the Placing, Open Offer and Admission Document
relating to the Greenbrook acquisition which can be found at
www.totallyplc.com/investor-relations/reports-documents.
• A review was undertaken during the year of Executive
and Non-Executive remuneration. Awards were made to
Wendy Lawrence, Lisa Barter and Gloria Cooke, effective
from 1 August 2019.
• With regards to the Chairman, Bob Holt, who has served
as Chairman since September 2015, the achievement of
a pre-exceptional EBITDA performance of £1.1m for the
financial year triggered a review of his fees. Bob Holt excluded
himself from the Committee review of this matter, and the
Independent Non-Executive Directors reviewed the matter.
Bob Holt had not taken any fees since the date of his appointment
in September 2015. After discussion it was agreed that Bob
Holt should be awarded an annual fee as Chairman of
£40,000, commencing 1 August 2019.
The full terms of reference of the Committee are available
on the Company’s website – www.totallyplc.com/
investor-relations/corporate-governance.
35
Annual Report for the year ended 31 March 2020 Totally plcGOVERNANCE Directors’ remuneration report continued
Remuneration Policy
It is the focus of the Remuneration Committee to ensure that a Director’s remuneration encourages, reinforces and rewards the
growth of shareholder value while promoting the long-term success of the Company. Remuneration Policy is intended to support
the business needs of the Company through ensuring the ability to attract, retain and motivate senior leaders of a high calibre
while remaining competitive and providing an appropriate incentive for good performance.
Executive Directors’ remuneration should also:
• Align Executives with the best interests of the Company’s shareholders and other relevant stakeholders through a weighting
on performance-related pay.
• Be consistent with all regulatory and corporate governance requirements.
• Be clear, straightforward and transparent while supporting the delivery of strategic objectives.
• Be consistent with the Group’s risk policies and systems to guard against inappropriate risk-taking.
The Committee seeks external guidance and benchmarking of remuneration strategies to assist the formulation of the Group
Remuneration Policy.
Disclosure of Directors’ remuneration – single total figure of remuneration (audited information)
The table below reports the total remuneration received in respect of qualifying services by each Director during the period ended
31 March 2020:
Total salary and fees
Taxable benefits
Annual bonus
Long-term
incentive
Pensions-related
benefits
Total remuneration
2020
£000
2019
£000
2020
£000
2019
£000
2020
£000
2019
£000
2020
£000
2019
£000
2020
£000
2019
£000
2020
£000
2019
£000
Executive Directors
Wendy Lawrence
Lisa Barter
Gloria Cooke
Michael Steel1
Non-Executive Directors
Don Baladasan
Bob Holt
Tony Bourne
Mike Rogers
161
119
108
156
—
27
25
25
140
105
102
—
23
—
25
25
621
420
1
2
2
—
—
—
—
—
5
2
1
—
—
—
—
—
—
3
40
25
20
—
—
—
—
—
85
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
—
24
12
—
—
—
—
—
—
36
21
11
10
—
—
—
—
—
42
226
158
130
156
—
27
25
25
163
117
112
—
23
—
25
25
747
465
1. Michael Steel was appointed to the Board on 20 June 2019 and resigned on 10 July 2020.
Annual bonus
Performance bonuses in respect of the financial year 2018/19 were paid following release of the audited accounts to:
• Wendy Lawrence
£40,000
• Lisa Barter
• Gloria Cooke
£25,000
£20,000
The awards reflected operational turnaround of the Vocare business with 97% registered services being rated as Good by the CQC
as well as achievement of pre-exceptional EBITDA of £1.1m.
No such bonus has yet been approved for the financial year 2019/20.
EMI approved options, CSOP and unapproved option schemes
No awards were made to Executive Directors under the above schemes during the financial year.
36
GOVERNANCETotally plc Annual Report for the year ended 31 March 2020 Long-Term Incentive Plan (2019) (“LTIP”)
The Totally plc Long-Term Incentive Plan (2019) was established during the year. The purpose of the Plan was to recognise the importance
in retaining certain key individuals to drive the integration and development of the business for the future. Shareholders approved
the LTIP arrangements with effect from the Greenbrook Admission Document. Awards will vest on a sliding scale dependent on
the achievement of share price hurdles measured at the vesting date from 25% of any award at a share price of 35p to 100% at 55p
per share. Full details of the Plan arrangements can be found from page 126 of the Greenbrook Admission Document, which can
be found at www.totallyplc.com/investor-relations/reports-documents.
A summary of option scheme awards, CSOP awards and unapproved share options
Name of Director
Scheme
Wendy Lawrence EMI approved options
CSOP
Unapproved options
LTIP
Total
CSOP
Lisa Barter
Unapproved options
LTIP
Total
Gloria Cooke
CSOP
Michael Steel
LTIP
Total
LTIP
Total
Number of
options as at
31.03.2019
Granted
during the
period
Lapsed
during the
period
Exercised
during the
period
Number of
options as at
31.03.2020
Date from
which
exercisable
Expiry date
250,000
74,000
176,000
—
—
—
— 3,000,000
500,000 3,000,000
74,000
26,000
—
—
— 1,500,000
100,000 1,500,000
50,000
—
— 1,500,000
50,000 1,500,000
— 1,500,000
— 1,500,000
—
—
—
—
—
—
—
—
—
—
—
—
—
—
— 250,000
11 Nov 18
11 Nov 25
—
74,000
31 Jan 21
31 Jan 28
— 176,000
31 Jan 21
31 Jan 28
— 3,000,000
20 Jun 22
20 Dec 25
— 3,500,000
—
—
74,000
31 Jan 21
31 Jan 28
26,000
31 Jan 21
31 Jan 28
— 1,500,000
20 Jun 22
20 Dec 25
— 1,600,000
—
50,000
31 Jan 21
31 Jan 28
— 1,500,000
20 Jun 22
20 Dec 25
— 1,550,000
— 1,500,000
20 Jun 22
20 Dec 25
— 1,500,000
Long-term incentive vesting
There were no long-term incentive awards capable of vesting during the period reported.
Shareholder dilution
In accordance with the investor guidelines and the rules of the Company’s share schemes, the Company can issue a maximum
of 10% of its issued share capital in a rolling ten-year period to employees to satisfy vesting under all its share plans. Of this 10%,
the Company can issue 5% to satisfy awards under discretionary or Executive plans.
Service contracts and letters of appointment
The table below summarises the service contracts of the Executive Directors and Non-Executive Directors.
Date of contract/letter of appointment
Notice period by Company
Notice period by Director
Executive Directors
Wendy Lawrence
Lisa Barter
Gloria Cooke
Michael Steel1
Non-Executive Directors
Bob Holt
Mike Rogers
Tony Bourne
15 Feb 2013
23 Oct 2017
19 July 2016
31 May 2019
15 Sept 2015
7 Dec 2015
5 Oct 2015
6 months
3 months
3 months
6 months
3 months
3 months
3 months
1. Michael Steel was appointed to the Board on 20 June 2019 and resigned on 10 July 2020.
Remuneration in the wider Group
Within the wider Group employee salaries and benefit levels are set taking into account prevailing market conditions.
The Group encourages share ownership by employees by offering a Sharesave (“SAYE”) Scheme.
Tony Bourne
Chairman of the Remuneration Committee
14 July 2020
6 months
3 months
3 months
6 months
3 months
3 months
3 months
37
Annual Report for the year ended 31 March 2020 Totally plcGOVERNANCE Directors’ report
The Directors present their Annual Report and the audited
Consolidated Financial Statements for the year ended
31 March 2020.
General information
The Company was incorporated as a public company limited
by shares in England and Wales on 28 October 1999, with
registered number 03870101. It is domiciled in the UK. The
Company is listed on the AIM market of the London Stock
Exchange. The Company’s registered address is Cardinal
Square West, 10 Nottingham Road, Derby DE1 3QT.
Principal activities
The Group aims to become a leading out-of-hospital
healthcare provider in the UK, helping to address some of
the biggest challenges faced by the UK healthcare sector.
Out-of-hospital services include care in the community,
GP surgeries, patients’ homes, prisons and other public
sector organisations, places of work as well as mobile
locations and urgent care solutions.
Results and dividends
The results for the period are set out in the Consolidated
Statement of Profit and Loss and Other Comprehensive
Income on page 47.
The Directors recommend the payment of a final dividend of
0.25p per share on 16 October 2020 subject to approval at the
Annual General Meeting on 7 September 2020, with a record
date of 18 September 2020.
Directors and Directors’ interests
The Directors who held office during the period and to date
were as follows:
• Bob Holt OBE
• Wendy Lawrence
• Lisa Barter
• Tony Bourne
• Michael Rogers
• Gloria Cooke
• Michael Steel (appointed on 20 June 2019 and resigned
on 10 July 2020)
Biographical details and Committee membership for Directors
appear on pages 24 and 25.
Directors retire by rotation in line with the Articles of
Association and the following Directors will seek re-election at
the Annual General Meeting to be held on 7 September 2020:
• Lisa Barter
• Gloria Cooke
The Directors who held office during the financial year
had the following interests in the shares of the Company:
Bob Holt
Wendy Lawrence
Lisa Barter
Gloria Cooke
Mike Rogers
Tony Bourne
Michael Steel
31 March 2020
Ordinary shares of
10p each held
31 March 2019
Ordinary shares of
10p each held
1,299,482
1,018,447
93,609
105,833
50,500
150,000
161,000
7,676,851
60,666
5,000
—
16,000
161,000
—
Michael Steel was appointed as a Director on 20 June 2020
and resigned on 10 July 2020.
Details of Directors’ emoluments and interest in share options
are disclosed in the Directors’ Remuneration Report on pages
36 and 37.
No Director has had a material interest in any contract of
significance in relation to the business of the Company, or any
of its subsidiary undertakings during the financial year or had
such at the end of the financial year.
Substantial shareholdings and share capital
As at 21 June 2020, being the latest practical date prior to the
publication of this document, the Company has been advised
of the following interests in 3% or more of the Company’s
ordinary share capital based on the 182,186,111 ordinary
shares in issue at 21 June 2020.
Fund manager
Number of
shares
% of
ISC
Miton Asset Management Limited
25,716,835
14.12%
Cavendish Asset
Management Limited
15,000,000
Columbia Threadneedle Investments
11,532,834
David and Monique Newlands
10,075,000
Liontrust Investment Partners LLP
Michael Steel (Executive Director)
Harwood Capital LLP
Richard Sneller
Unicorn Asset Management Limited
Daniel Annetts
8,136,423
7,676,851
7,330,000
7,300,000
5,759,291
5,619,596
8.23%
6.33%
5.53%
4.47%
4.21%
4.02%
4.00%
3.16%
3.08%
The Company has one class of share in issue, being ordinary
shares with a nominal value of 10p each. As at 31 March 2020
there were 182,186,111 shares in issue.
38
GOVERNANCETotally plc Annual Report for the year ended 31 March 2020 Annual General Meeting
A separate notice convening the Annual General Meeting of
the Company to be held at Cardinal Square, First Floor-West,
10 Nottingham Road, Derby DE1 3QT on 7 September 2020
will be sent out with this Annual Report and Financial Statements.
Corporate governance
The Company’s statement on corporate governance can
be found in the Chairman’s Introduction to Governance and
the Corporate Governance Report on pages 27 to 31. The
Corporate Governance Report forms part of this Directors’
Report and is incorporated into it by cross reference.
Section 172 statement
The required statement under Section 172 of the Companies
Act 2006 is contained within the Strategic Report on page 23.
Events after the reporting period
There were no disclosable events.
Independent auditor
The auditor, RPG Crouch Chapman LLP, has indicated its
willingness under Section 489 of the Companies Act 2006 to
continue in office and a resolution that it be re-appointed will
be proposed at the AGM.
Statement as to disclosure of information to auditor
Each of the persons who is a Director at the date of approval
of this Annual Report confirms that:
• In so far as the Director is aware, there is no relevant audit
information of which the Company’s auditor is unaware.
• The Director has taken all the steps that he/she ought to
have 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 Section 418 of the
Companies Act 2006.
By order of the Board
John Charlton
Group Company Secretary
14 July 2020
Directors’ indemnity
The Company’s Articles of Association provide, subject to the
provisions of UK legislation, an indemnity for Directors and
officers of the Company and the Group in respect of liabilities
that they may incur in the discharge of their duties or the
exercise of their powers, including any liability relating to the
defence of any proceedings brought against them which relate
to anything done or omitted, or alleged to have been done or
omitted, by them as officers or employees of the Company
and the Group.
Directors and officers’ liability insurance is in place in respect
of all the Company’s Directors.
Directors’ powers
As set out in the Company’s Articles of Association, the
business of the Company is managed by the Board who may
exercise all powers of the Company.
Our people
It is the Group’s policy to consider all job applications on a fair
basis free from discrimination on the basis of age, sex, race,
ethnicity, religion, sexual orientation or disability not related to
job performance. Every consideration is given to applications for
employment from disabled persons, where the requirements
of the job may be adequately covered by a disabled person.
Where existing employees become disabled, it is the Group’s
policy wherever practicable to provide continuing employment
under normal terms and conditions and to provide training and
career development wherever appropriate.
The Group values the involvement of its employees and encourages
the development of employee involvement in each of its operating
businesses through both formal and informal meetings. The
Group ensures that all employees are made aware of significant
matters affecting the performance of the Group by way of
employee forums, information bulletins, informal meetings,
team briefings, internal newsletters and the Group’s website.
Participation in the growth of Totally plc is encouraged by
offering all eligible employees the opportunity to participate
in the Company’s Save As You Earn (“SAYE”) Scheme.
Principal risks and uncertainties
Details of the principal risks and uncertainties faced by the
Group can be found in the Strategic Report on page 22.
Future developments
The Group remains committed to its buy and build strategy.
Details of the future developments for the Group can be found
in the Strategic Report on pages 1 to 23.
Financial instruments
An explanation of the Group’s treasury policies and
existing financial instruments are set out in note 24
of the financial statements.
Donations
The Group made charitable donations in the period of £nil.
The Group made no political donations during the period.
39
Annual Report for the year ended 31 March 2020 Totally plcGOVERNANCE A significant proportion of the Group’s consumption and
emissions arise from transportation, which is being managed
as follows:
• during the year the Group began moving towards using
vehicles with start/stop functions for out-of-hours services
and will continue to promote the use of energy-efficient
vehicles; and
• mileage claims relating to site visits by support teams are
being minimised by promoting video conferencing and
the use of public transport where video conferencing is
not possible.
Energy intensity metric
An energy intensity metric has been calculated using the
number of tonnes of CO2 emitted per £m of total sales
revenue, to provide a metric against which the Group will
measure current and future energy usage performance. This
measure takes account of the differing consumption between
divisions and the respective revenue of those divisions.
5.09 tonnes
energy intensity metric
Energy and emissions report
Reduction of energy usage and the associated emissions
should be the aim for all companies and the Group is no different.
The Group implemented the Streamlined Energy and Carbon
Reporting (“SECR”) requirements in the year, and the results
are shown below.
In supporting the NHS and other healthcare bodies, the Group
occupies a number of sites within hospitals and clinics across
the UK and we are not liable for energy costs in 98% of our
sites. Nonetheless the Group prioritises energy saving and is
reviewing sites where operational control could be possible in
order to reduce energy usage.
Total consumption of energy supplies
(20019/20 Consumption kwh)
Utility and scope*
Grid-supplied electricity (scope 2) 478
Natural gas (scope 1) 259
Transportation (scope 1) 1,533
2,270
2111
239
540
Total emissions from energy usage
(20019/20 Consumption CO2)
Utility and scope*
Grid-supplied electricity (scope 2) 122
Natural gas (scope 1) 48
Transportation (scope 1) 370
*
Scope 1 are direct emissions relating to natural gas and transportation fuel and
scope 2 are indirect emissions relating to the purchase of electricity.
Scope 1 and 2 consumption and CO2 emissions have been calculated in line with
2013 UK Government environmental reporting guidance, using the UK
Government’s 2019 emissions conversion factor database v1.01
40
GOVERNANCETotally plc Annual Report for the year ended 31 March 2020
+
68
+
L
+
68
+
L
Statement of Directors’ responsibilities
In respect of the Annual Report and the Financial Statements
Website publication
The Directors are responsible for ensuring the Annual Report
and the financial statements are made available on a website.
Financial statements are published on the Company’s website
in accordance with legislation in the United Kingdom governing
the preparation and dissemination of financial statements,
which may vary from legislation in other jurisdictions. The
maintenance and integrity of the Company’s website is the
responsibility of the Directors. The Directors’ responsibility
also extends to the ongoing integrity of the financial
statements contained therein.
This responsibility statement was approved by the Board
of Directors on 14 July 2020 and is signed on its behalf by:
Bob Holt OBE
Chairman
Lisa Barter, ACA
Finance Director
The Directors are responsible for preparing the Annual Report
and the financial statements in accordance with applicable law
and regulations. Company law requires the Directors to
prepare financial statements for each financial year.
Under that law the Directors have elected to prepare the
Group financial statements in accordance with International
Financial Reporting Standards (“IFRSs”) as adopted by the
European Union and the Company financial statements in
accordance with UK GAAP. Under company law the Directors
must not approve the financial statements unless they are
satisfied that they give a true and fair view of the state of affairs
of the Group and Company and of the profit or loss of the Group
for that period. The Directors are also required to prepare financial
statements in accordance with the rules of the London Stock
Exchange for companies trading securities on AIM.
In preparing these financial statements, the Directors are
required to:
• select suitable accounting policies and then apply
them consistently;
• make judgements and accounting estimates that are
reasonable and prudent;
• state whether they have been prepared in accordance
with IFRSs as adopted by the European Union, subject to any
material departures disclosed and explained in the financial
statements; and
• prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the Company will
continue in business.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Group’s
transactions and disclose with reasonable accuracy at any time
the financial position of the Group and enable them to ensure
that the financial statements comply with the requirements
of the Companies Act 2006. They are also responsible for
safeguarding the assets of the Group and hence for taking
reasonable steps for the prevention and detection of fraud
and other irregularities.
41
Annual Report for the year ended 31 March 2020 Totally plcGOVERNANCE
Independent auditor’s report
to the members of Totally plc for the period ended 31 March 2020
Our opinion on the financial statements
We have audited the financial statements of Totally plc (“the Company”) and its subsidiaries (“the Group”) for the year ended
31 March 2020 which comprise the Consolidated Statement of Profit or Loss and Other Comprehensive Income, the
Consolidated Statement of Financial Position, the Consolidated Statement of Changes in Equity, the Consolidated Statement of
Cash Flows, the Company Statement of Financial Position, the Company Statement of Changes in Equity and the related notes to
the financial statements, including a summary of significant accounting policies. The financial reporting framework that has been
applied in the preparation of the Group financial statements is applicable law and International Financial Reporting Standards
(“IFRSs”) as adopted by the European Union. The financial reporting framework that has been applied in the preparation of the
company financial statements is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard
101 Reduced Disclosure Framework (United Kingdom Generally Accepted Accounting Practice).
In our opinion:
• the financial statements give a true and fair view of the state of affairs of the Group and of the Company as at 31 March 2020
and of the Group’s loss for the year then ended;
• the Group financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union;
• the 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.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our responsibilities
under those standards are further described in the Auditor’s responsibilities for the audit of the financial statements section of
our report. We are independent of the Group and the parent company in accordance with the ethical requirements that are relevant
to our audit of the financial statements in the UK, including the FRC’s Ethical Standard as applied to listed entities, and we have
fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion.
Conclusions relating to going concern
We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:
• the Directors’ use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or
• the Directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt
about the Group’s or the parent company’s ability to continue to adopt the going concern basis of accounting for a period of at
least twelve months from the date when the financial statements are authorised for issue.
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant assessed risks of material misstatement we identified (whether
or not due to fraud), including those which had the greatest effect on: the overall audit strategy; the allocation of resources in the
audit; and directing the efforts of the engagement team. The matter identified was 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.
42
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020 Key audit matters continued
Key audit matter
Carrying value of intangible assets
The most significant assets of the Group as at 31 March 2020
are intangible assets at £39.7m comprising £30.5m of goodwill
arising on acquisition of subsidiaries and other intangibles of £9.2m.
In accordance with IAS36 Impairment of Assets, management
are required to conduct annual impairment tests for goodwill.
Given the subjectivity and number of estimates involved in any
such assessment, we considered this to be a significant risk of
material statement.
As part of their annual impairment review, management have
prepared cash flow models for each cash generating unit to
which goodwill relates to enable comparison of their value in
use to net carrying values at 31 March 2020.
An impairment charge of £1.5m has been made in the year against
the carrying value of the planned care cash generating unit.
How our audit addressed the key audit matter
Our work involved the following:
• Reviewing the impairment model provided and checking
that the value in use model meets the requirements of
the accounting standard;
• Testing the mathematical integrity of the cash flow model
in order to ensure the basis of preparation of the model;
• Discussing the assumptions used with management and
obtaining details to support the key assumptions;
• Challenging the assumptions used by reference to past results;
• Considering the impact of COVID 19 on operations based
on results post year end; and
• Sensitising the expected cash flows for key assumptions.
Key observations
Based on our audit work, we have concluded that the valuation
of non-current assets is accounted for in line with the Group’s
accounting policies and IAS 36 Impairment of Assets.
We concur with the impairment recorded by management
and consider that the disclosures in note 14 to the financial
statements appropriately describe the judgements made
by management.
Recognition of right‑of‑use‑assets and leased liabilities in accordance with IFRS 16 (Group and Company)
The Group adopted IFRS 16 Leases of Assets with effect from
1 April 2019. IFRS 16 replaces the existing standard IAS 17 and
specifies how a business should recognise, measure, present
and disclose leases. The standard provides a single lessee
accounting model, requiring the lessee to recognise assets
and liabilities for all leases unless the lease term is twelve
months or less or the underlying asset has a low value.
• Considering completeness by testing the reconciliation
• Verified the accuracy of the underlying lease data by
Our audit work included, but was not restricted to:
to the Group’s operating lease commitments;
Determining the value of the right-of use assets and lease
liabilities requires management to make judgements over key
estimates and assumptions, including the certainty of lease
term renewals and determination of appropriate discount
rates to be applied.
agreeing a sample of leases to original contract or other
supporting information, and agreed the integrity and
mechanical accuracy of the IFRS 16 calculations for each
lease sampled through recalculation of the expected
IFRS 16 adjustment;
• Assessed the appropriateness of the discount rates applied
in determining lease liabilities; and
Our specific audit focus was on the recognition of right-of-use
assets and lease liabilities considering the following areas of risk:
• Assessed whether the disclosures within the financial
statements are appropriate and complete.
• The underlying lease data used to calculate the impact
is incomplete and/or inaccurate;
• Specific assumptions applied to determine the discount
rates and lease term renewals; and
• The disclosures in the financial statements are insufficient
especially as to the transitional impact.
Key observations
Based on our audit work, we have concluded that the
implementation of IFRS 16 has been correctly performed
in accordance with the modified retrospective transition
requirements of the standard.
43
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc Independent auditor’s report continued
to the members of Totally plc for the period ended 31 March 2020
Key audit matters continued
Key audit matter
Accounting for business combination
During the year, the Group acquired Greenbrook healthcare for
£16.2m payable in cash and shares.
This transaction is accounted for as a business combination
under IFRS 3. This involves recognising the fair valuation of all
identifiable assets and liabilities arising on the acquisition.
The fair valuation is an extremely complex area and involves
the use of a number of estimates. As such we consider this
to be a significant risk of material misstatement.
Revenue recognition
Urgent Care provides a range of services such as the NHS 111
service, urgent care services and GP out of hours services
under multi-year contracts with the NHS and other organisations.
Many of these contracts are individually material and contain
provisions for the clawback of revenue by the customer dependent
on activity based key performance indicators KPIs.
Although there should be annual reviews where final contract
values are agreed this process can take an extended period.
We therefore identified revenue recognition as a significant risk.
How our audit addressed the key audit matter
Our work involved:
• Confirming consideration to signed purchase agreement
and completion statement;
• Agreeing net assets acquired to the completion statement;
• Reviewing the assets and liabilities in the completion accounts
and if any adjustments would be required to reflect their fair
value at acquisition date;
• Reviewing the underlying activity of the acquiree, discussed
with management and considered other information to establish
if any other identifiable assets and liabilities could exist;
• Considering the methodology used by management to
measure the fair value adjustments and agree to supporting
documentation; and
• Reviewing the disclosures required under IFRS 3 and ensuring
that these are appropriately reflected in the business combination
note in the financial statements.
Key observations
Based on our audit work, we have concluded that the acquisition
was been accounted for appropriately under IFRS 3 and that
the fair values are appropriately derived.
We concur with the disclosures made by management in note 18
to the financial statements which appropriately describe the
judgements made by management.
Our audit work included, but was not restricted to:
• Reconciling expected income for a sample of revenue
contracts to amounts reported in the accounts;
• Reviewing activity performance reports for a sample of
revenue contracts against KPI requirements and assessing
the adequacy of provisions recognised; and
• Review of settlement of contract values after the year end.
Key observations
Based on our audit work, we have concluded that revenue has
been recognised appropriately and provisions recognised for
clawback related to KPIs are considered to be reasonable.
All key matters noted above have been discussed with the Audit Committee.
44
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020 Our application of materiality
We apply the concept of materiality both in planning and performing our audit, and in evaluating the effect of misstatements.
We consider materiality to be the magnitude by which misstatements, including omissions, could influence the economic
decisions of reasonable users that are taken on the basis of the financial statements.
In order to reduce to an appropriately low level the probability that any misstatements exceed materiality, we use a lower
materiality level, performance materiality, to determine the extent of testing needed. Importantly, misstatements below these
levels will not necessarily be evaluated as immaterial as we also take account of the nature of identified misstatements, and the
particular circumstances of their occurrence, when evaluating their effect on the financial statements as a whole.
Our basis for the determination of materiality has remained consistent with the prior year. Given the changes to the Group in
recent periods and the fluctuations in profit, we consider revenue to be the most significant determinant of the Group’s financial
performance used by the users of the financial statements. A rate of 1% was used which is consistent with the prior year.
Whilst materiality for the financial statements as a whole was £1,050,000 (2019: £780,000), each significant component of the
Group was audited to a lower level of materiality. The Company materiality was £600,000 (2019: £480,000), based on 1.5% of
gross assets (2019: 2%) as that is deemed the considered the most appropriate measure for a holding company. The increases in
both levels of materiality is due to the acquisition of Greenbrook Healthcare in the year leading to an increase in revenue at Group
level and an increase in gross assets at Company level representing the investment made. The other components materiality
levels varied from £640,000 to £50,000.
Performance materiality is the application of materiality at the individual account or balance level set at an amount to reduce to
an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality.
Performance materiality for the Group was set at £750,000 for low risk audit areas representing 75% of materiality based upon our
assessment of expected misstatements and the control environment. Performance materiality of £500,000 was used for areas
considered to be higher risk, representing 50% of overall materiality.
The same percentages were applied to each component’s materiality calculations. We agreed with the Audit Committee that we
would report on all differences in excess of 5% of materiality relating to the Group financial statements. We also report to the
Audit Committee on financial statement disclosure matters identified when assessing the overall consistency and presentation of
the consolidated financial statements.
An overview of the scope of our audit
The Group audit was scoped by re-confirming our understanding of the business, Group structure, systems and processes and
the internal control environment. All of the components are based in the UK and a full scope statutory audit was completed by
RPG Crouch Chapman LLP in respect of each.
Other information
The Directors are responsible for the other information. The other information comprises the information included in the Annual
Report, other than the financial statements and our auditor’s report thereon. Our opinion on the financial statements does not
cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of
assurance conclusion thereon.
In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so,
consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the
audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements,
we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of
the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other
information, we are required to report that fact. We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
• the information given in the Strategic Report and the Directors’ Report for the financial year for which the financial statements
are prepared is consistent with the financial statements; and
• the Strategic Report and the Directors’ Report have been prepared in accordance with applicable legal requirements.
45
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc Independent auditor’s report continued
to the members of Totally plc for the period ended 31 March 2020
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Group and the parent company and its environment obtained in the course
of the audit, we have not identified material misstatements in the Strategic Report or the Directors’ Report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires us to report
to you if, in our opinion:
• adequate accounting records have not been kept, or returns adequate for our audit have not been received from branches
not visited by us; or
• the parent company financial statements are not in agreement with the accounting records and returns; or
• certain disclosures of Directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
Responsibilities of Directors
As explained more fully in the Statement of Directors’ Responsibilities on page 41, the Directors are responsible for the preparation of
the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the Directors
determine is necessary to enable the preparation of financial statements that are free from material misstatement, whether due
to fraud or error.
In preparing the financial statements, the Directors are responsible for assessing the Group’s and the parent company’s ability
to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis
of accounting unless the Directors either intend to liquidate the Group or the parent company or to cease operations, or have
no realistic alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion. Reasonable assurance
is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists.
Misstatements can arise from fraud or error and are considered material if, individually or in aggregate, they could reasonably
be expected to influence the economic decisions of users taken on the basis of these financial statements.
A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council’s
website at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006.
Our audit work has been undertaken so that we might state to the Company’s members those matters we are required to state to
them in an auditor’s report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility
to anyone other than the Company and the Company’s members as a body, for our audit work, for this report, or for the opinions
we have formed.
Colin Turnbull ACA
Senior Statutory Auditor
for and on behalf of RPG Crouch Chapman LLP
Statutory Auditor, Chartered Accountants
62 Wilson Street
London
EC2A 2BU
14 July 2020
RPG Crouch Chapman LLP is a limited liability partnership registered in England and Wales (with registered number OC375705).
46
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020 Consolidated statement of profit or loss and other comprehensive income
For the year ended 31 March 2020
Continuing operations
Revenue
Cost of sales
Gross profit
Administrative expenses
Profit before exceptional items
Exceptional items
Profit before interest, tax and depreciation
Depreciation and amortisation
Operating loss
Finance income
Finance costs
Loss before taxation
Income tax credit
Loss for the year attributable to the equity shareholders of the parent company
Other comprehensive income
Total comprehensive loss for the year net of tax attributable to the equity shareholders
of the parent company
Loss per share
From continuing operations:
Basic
Diluted
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
105,948
78,007
(86,772)
(65,939)
19,176
12,068
(15,140)
(10,962)
4,036
(2,028)
2,008
(5,122)
(3,114)
6
(302)
1,106
126
1,232
(2,822)
(1,590)
3
(228)
(3,410)
(1,815)
577
313
(2,833)
(1,502)
—
—
(2,833)
(1,502)
12 months to
31 March 2020
Pence
12 months to
31 March 2019
Pence
(1.82)
(1.82)
(2.51)
(2.51)
Note
6
8
9
10
11
12
Note
25b
25b
47
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
Consolidated statement of changes in equity
For the year ended 31 March 2020
At 1 April 2018
Total comprehensive loss for the year
Credit on issue of warrants and options
At 31 March 2019
Total comprehensive loss for the year
Cancellation of share premium account
Issue of shares
Expenses attached to equity issue
Dividend payment
Credit on issue of warrants and options
At 31 March 2020
Note
25c
25a
13
26c
Share capital
£000
5,979
—
—
Share
premium
£000
16,408
—
—
5,979
16,408
—
—
12,240
—
—
—
18,219
—
—
—
—
—
—
Retained
earnings
£000
4,951
(1,502)
43
3,492
(2,833)
—
(450)
(455)
64
Equity
shareholders’
funds
£000
27,338
(1,502)
43
25,879
(2,833)
—
12,240
(450)
(455)
64
16,226
34,445
(16,408)
16,408
The Company Statement of Changes in Equity can be found in note 27.
The accompanying notes on pages 51 to 79 form part of the financial statements.
48
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020 Consolidated and Company statements of financial position
As at 31 March 2020
Non-current assets
Intangible assets
Property, plant and equipment
Right-of-use assets
Investments in subsidiaries
Deferred tax
Current assets
Inventories
Trade and other receivables
Cash and cash equivalents
Total assets
Current liabilities
Trade and other payables
Contingent consideration
Lease liabilities
Non-current liabilities
Trade and other payables
Lease liabilities
Deferred tax
Total liabilities
Net current liabilities
Net assets
Shareholders’ equity
Called up share capital
Share premium
Retained earnings
Equity shareholders’ funds
Consolidated
Company
Note
31 March 2020
£000
31 March 2019
£000
31 March 2020
£000
31 March 2019
£000
14
15
16
17
12
19
20
21
22
16
21
16
12
39,631
789
4,129
—
408
28,824
599
—
—
158
9
43
288
26
43
—
38,149
21,835
—
—
44,957
29,581
38,489
21,904
77
11,370
8,923
20,370
65,327
68
8,606
7,520
16,194
45,775
—
728
718
1,446
39,935
—
677
1,254
1,931
23,835
(24,367)
(18,784)
(13,457)
(5,362)
(271)
(1,449)
(322)
(5)
(271)
(58)
(322)
—
(26,087)
(19,111)
(13,786)
(5,684)
(786)
(2,729)
(1,280)
(4,795)
(768)
(3)
(14)
(785)
(18)
(234)
—
(252)
(16)
—
—
(16)
(30,882)
(19,896)
(5,717)
34,445
(2,917)
25,879
(14,038)
(12,340)
(5,700)
(3,753)
25,897
18,135
25a
25c
25d
18,219
—
16,226
34,445
5,979
16,408
3,492
25,879
18,219
—
7,678
25,897
5,979
16,408
(4,252)
18,135
These financial statements were approved by the Board of Directors on 14 July 2020 and were signed on its behalf by:
Wendy Lawrence
Director
Totally plc
Lisa Barter, ACA
Director
Company registration no: 3870101 (England and Wales)
The accompanying notes on pages 51 to 79 form part of the financial statements.
49
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
Consolidated cash flow statement
For the year ended 31 March 2020
Cash flows from operating activities
Loss for the year
Adjustments for:
- options and warrants charge
- depreciation and amortisation
- impairment of goodwill
- tax income recognised in profit or loss
- finance income
- finance costs
- revaluation of contingent consideration
Movements in working capital:
- inventories
- movement in trade and other receivables
- movement in trade and other payables
Cash used for operations
- income tax (paid)/received
Net cash flows from operating activities
Cash flows from investing activities
Purchase of property, plant and equipment
Additions of intangible assets
Acquisition of subsidiaries, net of cash acquired
Contingent consideration paid
Net cash flows from investing activities
Cash flows from financing activities
Issue of share capital
Expenses attached to equity issue
Dividends paid to the holders of the parent
Interest paid
Principal paid on lease liabilities
Net cash flows from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at the beginning of the year
Cash and cash equivalents at the end of the year
The accompanying notes on pages 51 to 79 form part of the financial statements.
Note
31 March 2020
£000
31 March 2019
£000
(2,833)
(1,502)
25
14-16
14
10
11
22
15
14
18
22
64
5,122
1,500
(577)
(6)
302
—
(8)
1,891
(2,452)
3,003
(104)
2,899
(397)
(192)
(7,955)
(51)
(8,595)
25a
9,739
13
16
(450)
(455)
(97)
(1,638)
7,099
1,403
7,520
8,923
43
2,822
2,000
(313)
—
112
(2,668)
10
1,100
(3,457)
(1,853)
39
(1,814)
(265)
(491)
—
(130)
(886)
—
—
—
(4)
(4)
(2,704)
10,224
7,520
50
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020
Notes to the financial statements
For the year ended 31 March 2020
1. General information
Totally plc is a public limited company (“the Company”) incorporated in the United Kingdom under the Companies Act 2006
(registration number 3870101). The Company is domiciled in the United Kingdom and its registered address is Cardinal Square
West, 10 Nottingham Road, Derby DE1 3QT. The Company’s ordinary shares are traded on the AlM market of the London Stock
Exchange (“AIM”).
The Group’s principal activities are the provision of innovative and consolidatory solutions to the healthcare sector, which are
provided by the Group’s wholly owned subsidiaries.
The Company’s principal activity is to provide management services to its subsidiaries.
2. Authorisation of financial statements and statement of compliance
The financial statements for the year ended 31 March 2020 were authorised for issue by the Board of Directors and the
Statements of Financial Position were signed on the Board’s behalf by Wendy Lawrence and Lisa Barter on 14 July 2020.
The Group’s financial statements have been prepared in accordance with International Financial Reporting Standards (“IFRSs”)
and International Financial Reporting Interpretations Committee (“IFRIC”) interpretations as endorsed by the European Union (“EU”),
and bearing in mind those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The financial statements
of the Company have been prepared in accordance with Financial Reporting Standard 101 Reduced Disclosure Framework (“FRS 101”).
The financial statements have been prepared under the historical cost convention and in accordance with the Companies Act 2006.
In preparing its financial statements the Company has taken advantage of all disclosure exemptions conferred by FRS 101.
Therefore, the Company’s financial statements do not include:
• certain comparative information as otherwise required by EU endorsed IFRSs;
• certain disclosures regarding the Company’s capital;
• a statement of cash flows;
• the effect of future accounting standards not yet adopted;
• the disclosure of the remuneration of key management personnel; and
• disclosure of related party transactions with wholly owned fellow group companies.
In addition, and in accordance with FRS 101, further disclosure exemptions have been adopted because equivalent disclosures
are included in the consolidated financial statements of Totally plc. The Company’s financial statements do not include certain
disclosures in respect of:
• share-based payments; and
• fair value measurement (other than certain disclosures required as a result of recording financial instruments at fair value).
As permitted by Section 408 of the Companies Act 2006 no income statement is presented for the Company. The Company
made a loss of £3,637,000 for the year ended 31 March 2020 (2019: loss £2,511,000).
3. Basis of preparation
The Consolidated and Company Financial Statements have been prepared on the historical cost basis and are presented
in Sterling and all values are rounded to the nearest thousand pounds (£000) except when otherwise indicated.
The Group’s business activities, together with the factors likely to affect its future development, performance and position are set
out in the Strategic Report on pages 1 to 23. The financial position of the Group is described in the Financial Review on pages 18 to 20
and the Group’s approach to risk is detailed on pages 21 and 22 and in note 24.
The Group has consistently had net current liabilities in recent reporting periods which reflects the nature of the contractual
terms with customers and suppliers. The Group carefully manages financial resources, closely monitoring the working capital
cycle and has long-term contracts with a number of customers and suppliers across different geographic areas within the United
Kingdom and industries. As a consequence, the Directors believe that the Group is well placed to manage its business risks
successfully despite the current uncertain economic outlook.
The Directors have produced forecasts that have been sensitised to reflect plausible downside scenarios including as a result of the
COVID-19 pandemic and its impact on the Group’s operations given the nature of its contracts with customers and the customer
base. These demonstrate the Group is forecast to generate profit before interest, depreciation and amortisation in the year ending
31 March 2021 and beyond and that the Group has sufficient cash reserves to enable the Group to meet its obligations as they fall
due for a period of at least 12 months from the date of signing of these financial statements.
As such, the Directors are satisfied that the Group has adequate resources to continue to operate for the foreseeable future.
For this reason they continue to adopt the going concern basis for preparing these financial statements.
51
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc 4. Summary of significant accounting policies
Basis of consolidation
The Group’s financial statements include the results of the Company and its subsidiaries, all of which are prepared up to the same
date as the parent company.
Subsidiaries
Subsidiaries are all entities over which the Company has the ability to exercise control and are accounted for as subsidiaries.
The trading results of subsidiaries acquired or disposed of during the period end are included in the income statement from
the effective date of acquisition or up to the effective date of disposal, as appropriate.
All intra-group transactions, balances, income and expenditure are eliminated on consolidation.
The purchase method of accounting is used to account for the acquisition of subsidiaries by the Company. The cost of an
acquisition is measured as the fair value of the assets given, equity instruments issued and liabilities incurred or assumed at the
date of exchange. Identifiable assets acquired and liabilities and contingent liabilities assumed in a business combination are
initially measured at fair value at the acquisition date irrespective of the extent of any non-controlling interest. The excess of cost
of acquisition over the fair values of the Group’s share of identifiable net assets acquired is recognised as goodwill. Any deficiency
of the cost of acquisition below the fair value of identifiable net assets acquired (i.e. discount on acquisition) is recognised directly
in the income statement. All acquisition expenses have been reported within the income statement immediately.
Any contingent consideration to be transferred by the Group is recognised at fair value at the acquisition date. Subsequent
changes to the fair value of the contingent consideration that is deemed to be an asset or liability is recognised in accordance
with IAS 39 either in profit or loss or as a change to other comprehensive income.
Where necessary, adjustments are made to the financial information of subsidiaries to bring the accounting policies used in line
with those used by other members of the Group.
Revenue recognition
Revenue is generated by providing insourcing, planned care and urgent care services. Services are provided through short-term
and long-term contracts.
Revenue is recognised to the extent that it is probable that the economic benefits will flow to the Group and the revenue can be
reliably measured. Revenue is measured as the fair value of the consideration received or receivable, excluding discounts, rebates,
value added tax and other sales taxes.
Insourcing
Revenue is recognised as services are provided. Revenue is recognised in the month when the service is provided, as this
is the point when revenue activity can be reliably measured.
Planned care services
Revenue represents invoiced sales of services to regional Care Commissioning Groups of the National Health Service. Revenue is
recognised in the month when the service is provided, as this is the point when revenue activity can be reliably measured. Revenue
can be subject to clawback adjustments based on performance against criteria as detailed in the individual contracts.
Urgent care services
Revenue is recognised as services are provided. Revenue is recognised in the month when the service is provided, as this is the
point when revenue activity can be reliably measured. Revenue can be subject to clawback adjustments based on performance
against criteria as detailed in the individual contracts.
All revenue originates in the United Kingdom.
Finance income
Finance income comprises bank interest received, recognised on an accruals basis.
Finance costs
Finance costs comprise bank charges and interest on leases recognised under IFRS 16. The prior year also included the unwinding
of the fair value adjustment of the contingent consideration.
Property, plant and equipment
Property, plant and equipment is carried at cost less accumulated depreciation and any recognised impairment in value.
Cost comprises the aggregate amount paid to acquire assets and includes costs directly attributable to making the asset
capable of operating as intended.
52
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020 4. Summary of significant accounting policies continued
Property, plant and equipment continued
Depreciation is calculated to write down the cost of the assets to their residual values by equal instalments over the estimated
useful economic lives as follows:
Motor vehicles
Computer equipment
Plant and machinery and Office equipment
Freehold property improvements and Short leasehold property
–
–
–
–
3 and 5 years
2 and 5 years
2 to 5 years
3 to 10 years
The assets’ residual values, useful lives and methods of depreciation are reviewed, and adjusted if appropriate on an annual basis.
An asset is de-recognised upon disposal or when no future economic benefits are expected from its use or disposal. Any gain or
loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying
amount of the asset) is included in the income statement in the period that the asset is de-recognised.
Inventories
Inventories are valued at the lower of cost and net realisable value. In general, costs are determined on a first in first out basis and
includes all direct expenditure based on a normal level of activity. Net realisable value is the price at which the stocks can be sold in
the normal course of business after allowing for the costs of realisation and where appropriate for the costs of conversion from its
existing state to a finished condition.
Intangible assets other than goodwill
Intangible assets other than goodwill comprise computer software and customer contracts and relationships.
Computer software is recognised at cost and subsequently amortised over its expected useful economic life of three years.
Customer contracts and the related customer relationships were acquired in business combinations and recognised separately
from goodwill. They are initially recognised at their fair value at the acquisition date (which is regarded as their cost). Subsequent to
initial recognition, these assets are amortised over the expected life of contracts and reported at cost less accumulated amortisation
and accumulated impairment losses. Assets are reviewed for impairment on at least an annual basis and the estimates used in this
review are discussed in note 5.
Goodwill
Goodwill represents the excess of the fair value of the consideration of an acquisition over the fair value of the Group’s share of
the net identifiable assets of the acquired subsidiary at the date of acquisition. Goodwill is considered to have an indefinite useful
life. Goodwill is tested for impairment annually and again whenever indicators of impairment are detected and is carried at cost
less any provision for impairment.
Impairment of non-current assets
For the purposes of impairment testing, goodwill is allocated to each of the Group’s cash-generating units (“CGUs”) or groups
of CGUs that is expected to benefit from the synergies of the combination. These comprise Urgent Care and Planned Care
segments and at 31 March 2020 the goodwill allocated to each amounted to £23,169,000 and £7,836,000 respectively.
A cash-generating unit to which goodwill has been allocated is 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 its carrying amount,
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 based on the carrying amount of each asset in the unit. Any impairment loss for goodwill is recognised
directly in profit or loss. An impairment loss recognised for goodwill is not reversed in subsequent periods.
The value of the goodwill was tested for impairment during the current financial year by means of comparing the recoverable
amount of each CGU or group of CGUs with the carrying value of its goodwill, see note 14.
On disposal of the relevant cash-generating unit, the attributable amount of goodwill is included in the determination of the profit
or loss on disposal.
Trade and other receivables
Trade receivables, which are generally received by the end of month following terms, are recognised and carried at the lower
of their original invoiced value less provision for expected credit losses.
Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and short-term deposits with an original maturity of three months or less.
Trade and other payables
Trade payables are obligations to pay for goods and services that have been acquired in the ordinary course of business from
suppliers. Trade and other payables are recognised at original cost.
53
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
4. Summary of significant accounting policies continued
Borrowings
Borrowings are initially recognised at fair value, being proceeds received less directly attributable transaction costs incurred.
Borrowings are subsequently measured at amortised cost with any transaction costs amortised to the income statement over
the period of the borrowings using the effective interest method.
Foreign currencies transactions
Transactions denominated in foreign currencies are translated at the exchange rate at the date of the transaction. Monetary
assets and liabilities denominated in foreign currencies at the period end are translated at the exchange rate ruling at that date.
Foreign exchange differences arising on translation are recognised in the income statement.
Leased assets
Until 31 March 2019, leases of property, plant and equipment were classified as either finance leases or operating leases. From
1 April 2019, leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is
available for use by the Company. Details of the implementation are included in note 30.
Assets and liabilities arising from a lease are initially measured on a present value basis. Lease liabilities include the net present
value of fixed lease payments. The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot
be readily determined, the lessee’s incremental borrowing rate is used, being the rate that the lessee would have to borrow the
funds necessary to obtain an asset of similar value to the right-of-use asset with similar terms, security and conditions.
Lease payments are allocated between principal and finance costs. The finance cost is charged to profit or loss over the lease
period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
Right-of-use assets are measured at cost comprising the initial measurement of lease liability, any lease payments made
at or before the commencement date less any lease incentives received, and any initial direct costs.
Right-of-use assets are depreciated over the shorter of the asset’s useful life and the lease term on a straight-line basis.
Payments associated with short-term leases of equipment and vehicles and all leases of assets considered low value are recognised
as an expense in profit or loss on a straight-line basis. Short-term leases are leases with a lease term of twelve months or less.
Onerous contracts
An onerous contract is considered to exist where the Group has a contract under which the unavoidable costs of meeting the
obligations under the contract exceed the economic benefits expected to be received under it. The difference between expected
revenue and directly attributable and unavoidable costs is provided for at each reporting date.
Exceptional items
Exceptional items are those items that, in the Directors’ view, are required to be separately disclosed by virtue of their size
or incidence to enable a full understanding of the Group’s financial performance.
Income taxes
Current income tax assets and liabilities are measured at the amount expected to be recovered or paid to the taxation authorities
based on tax rates and laws that are enacted or substantively enacted by the period end date. Deferred income tax is recognised
using the balance sheet liability method, providing for temporary differences between the tax bases and the accounting bases of
assets and liabilities. Deferred income tax is calculated on an undiscounted basis at the tax rates that are expected to apply in the
period when the liability is settled and the asset is realised, based on tax rates and laws enacted or substantively enacted at the
period end date.
Deferred income tax liabilities are recognised for all temporary differences, except for an asset or liability in a transaction that is
not a business combination, and at the time of the transaction affects neither the accounting profit nor taxable profit or loss.
Deferred income tax is charged or credited to the income statement, except when it relates to items charged or credited to equity,
in which case the deferred tax is also dealt with in equity. Deferred income tax assets and liabilities are offset against each other
only when the Company has a legally enforceable right to do so.
Deferred income tax assets are recognised to the extent that it is probable that future taxable profits will be available against
which the deductible temporary differences can be utilised.
Retirement benefits
The Group operates a defined contribution plan. A defined contribution plan is a pension plan under which the employer pays fixed
contribution into a separate entity. Contributions payable to the plan are charged to the income statement in the period to which
they relate. The Group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient
assets to pay all employees the benefits relating to employee service in the current and prior periods.
54
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020 4. Summary of significant accounting policies continued
Company only accounting policies
The following principal accounting policies have been applied:
Investments
Fixed asset investments are stated at cost less provisions for diminution in value.
Deferred tax
Deferred tax assets and liabilities are recognised where the carrying amount of an asset or liability in the Company Statement
of Financial Position differs from its tax base, except for differences arising on:
• the initial recognition of goodwill;
• the initial recognition of an asset or liability in a transaction which is not a business combination and at the time of the
transaction affects neither accounting or taxable profit; and
•
investments in subsidiaries where the Company is able to control the timing of the reversal of the difference and it is probable
that the difference will not reverse in the foreseeable future.
Recognition of deferred tax assets is restricted to those instances where it is probable that taxable profit will be available against
which the difference can be utilised.
The amount of the asset or liability is determined using tax rates that have been enacted or substantively enacted by the reporting date
and are expected to apply when the deferred tax liabilities or assets are settled or recovered. Deferred tax balances are not discounted.
Share-based payments
The Group provides benefits to employees (including Directors) of the Group in the form of share-based payment transactions,
whereby employees render services in exchange for shares or rights over shares. The fair value of the employee services rendered
is determined by reference to the fair value of the shares awarded or options granted, Share options are valued using the Black
Scholes pricing model, or the Monte Carlo model where performance-based market vesting conditions apply. This fair value is charged
to the income statement over the vesting period of the share-based payment scheme, with the corresponding increase in equity.
The value of the charge is adjusted in the income statement over the remainder of the vesting period to reflect expected
and actual levels of options vesting, with the corresponding adjustment made in equity.
Standards adopted in the year
During the year the Group adopted IFRS 16 with a transition date of 1 April 2019. Details of the impact are given in notes 16 and 30.
There have been no other standards adopted that have had a material impact on the financial statements and no standards
adopted in advance of their implementation dates.
Standards, interpretations and amendments not yet effective
There are a number of standards, amendments to standards, and interpretations which have been issued by the International
Accounting Standards Board (“IASB”) that are effective in future accounting periods that the Group has decided not to adopt early.
The following amendments are effective for the period beginning 1 April 2020:
• IAS 1 Presentation of Financial Statements;
• IAS 8 Accounting Policies, Changes in Accounting Estimates and Errors (Amendment – Definition of Material); and
• IFRS 3 Business Combinations (Amendment – Definition of Business).
In January 2020, the IASB issued amendments to IAS 1, which clarify the criteria used to determine whether liabilities are classified
as current or non-current. These amendments clarify that current or non-current classification is based on whether an entity has
a right at the end of the reporting period to defer settlement of the liability for at least twelve months after the reporting period.
The Group does not believe that the amendments to IAS 1 will have a significant impact on the classification of its liabilities.
55
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc 5. Significant accounting judgements, estimates and assumptions
The Group makes judgements, estimates and assumptions that affect the application of policies and reported amounts of assets
and liabilities, income and expenses. The resulting accounting estimates calculated using these judgements and assumptions will,
by definition, seldom equal the related actual results but are based on historical experience and expectations of future events.
The Group’s 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 revision and
future periods if the revision affects both current and future periods.
Judgements
The Directors consider that there are no significant judgements that have an impact on the Group’s accounting policies.
Estimates
Following the assessment of the recoverable amount of goodwill allocated to the Planned Care segment, to which goodwill of
£7,836,000 is allocated, the Directors consider that the recoverable amount of goodwill allocated to this segment is most sensitive
to the achievement of future budgets. Budgets comprise forecasts of revenue, staff costs and overheads based on current and
anticipated market conditions that have been considered and approved by the Board. A significant proportion of the cost allocated
to both CGUs is staff costs, hence the Group’s commitment to its staff and patients. The sensitivity analysis in respect of the
recoverable amount of each CGU is presented in note 14.
Fair value assets and liabilities arising on business combination
During the year, the Group completed the acquisition of Greenbrook Healthcare (Hounslow) Limited and Greenbrook Healthcare
(Earls Court) Limited. This has been accounted for as a business combination which requires the fair valuation of assets and
liabilities at the acquisition date. This can involve the identification of further intangible assets which were not recognised in the
acquired entities’ books. In determining the fair value of the intangibles, the Directors have considered the underlying nature of
the assets and employed valuation techniques based on forecast earnings to estimate the value of the intangibles arising as
highlighted in note 18. The most significant assumption is around the assumption of contract renewals which itself is based on the
past history of renewals as achieved by the acquiree. Should this assumption not be made the intangibles asset valuation at the
acquisition would reduce by £4.2m with goodwill increasing by the same amount.
6. Revenue
A breakdown of revenue by the revenue streams detailed in the accounting policies is shown below:
Insourcing
Planned care services
Urgent care services
Total
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
1,006
8,444
96,498
105,948
30
8,427
69,550
78,007
All revenue is recognised as the services are provided and in accordance with the accounting policies detailed in note 4.
The following table provides information on contract assets and contract liabilities from contracts with customers:
Contract assets
Contract liabilities
Total
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
3,479
(2,159)
720
1,503
(3,341)
(1,838)
Contract assets and contract liabilities relate to amounts recognised in respect of accrued and deferred income for contracts with
customers and are included within “trade and other receivables” and “trade and other payables” respectively on the face of the
statement of financial position.
Contract assets primarily relate to the Company’s rights to consideration for services provided but not billed. The contract assets
are transferred to trade receivables when the rights become unconditional which is upon agreement by the CCG.
Contract liabilities primarily relate to advance consideration received from customers and provision for clawback adjustments on
contracts with customers based on contractual performance. Management estimates the level of revenue subject to clawback
and makes a provision under the variable consideration constraint within IFRS 15. These amounts are subject to negotiation with
agreement generally within one to two years, however management do not consider these to be a significant estimate given the
status of negotiations.
56
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020
6. Revenue continued
The significant movements in contract assets in the periods ended 31 March 2020 and 31 March 2019 are detailed below:
Brought forward
Acquired on business combination
Provided
Utilised
Total
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
1,503
511
13,363
(11,898)
3,479
1,189
—
5,357
(5,043)
1,503
The significant movements in contract liabilities in the periods ended 31 March 2020 and 31 March 2019 are detailed below:
Brought forward
Acquired on business combination
Provided
Utilised
Total
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
3,341
222
3,438
(4,842)
2,159
3,416
—
3,645
(3,720)
3,341
7. Segmental reporting
Segment information is presented in respect of the Group’s operating segments. Segments are determined by reference
to the internal reports reviewed by the Board.
Management has determined the operating segments based on the information provided to the Executive Management team
(the Chief Operating Decision Maker (“CODM”) for the Group) to make operational decisions on the management of the Group.
As noted in the Strategic Report, management considers there to be three operating segments being Urgent Care, Planned Care
and Insourcing. Management has considered the economic characteristics, similarity of services, customers, sales methods and
regulatory environment of its non-urgent care services. In doing so it has been concluded that they should be aggregated into
one “Other” segment for reporting in the financial statements. This aggregated information provides users with the financial
information needed to evaluate the business and the environment in which it operates. The segmental analysis on page 58 is split
as follows:
• Urgent Care; and
• Other – Insourcing, Planned Care and costs of corporate functions and Group eliminations.
The Group’s management reporting and controlling systems use the accounting policies that are the same as those referred
to in note 4.
Segmental analysis – segment measures
The Group measures the performance of its operating segments through a measure of segment profit or loss which is referred
to as EBITDA. This measure is reported to the CODM for the purposes of resource allocation and assessment of performance.
Interest income, interest expense and income tax expense are not included in the EBITDA profit measure which is reviewed
by the CODM. Tax and treasury balances are managed centrally.
Segment assets and liabilities are not regularly reviewed by the CODM. The Group has elected, as provided under IFRS 8 “Operating
Segments” (amended 2009) not to disclose segment assets or liabilities as these amounts are not regularly provided to the CODM.
In the years ended 31 March 2020 and 31 March 2019, all segments operated solely in the UK, and as a result no geographical
breakdown is provided.
57
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
7. Segmental reporting continued
Primary reporting format – business segments
The table below sets out information for the Group’s business segments for the years ended 31 March 2020 and 31 March 2019.
Segment revenue represents revenue from external and internal customers arising from the sale of services.
Segment results include items directly attributable to a segment as well as those that can be allocated on a reasonable basis.
Analysis by business segment
12 months to 31 March 2020
12 months to 31 March 2019
Urgent Care
£000
Other
£000
Total
£000
Urgent Care
£000
Other
£000
Total
£000
Group revenue
96,498
9,450
105,948
69,550
8,457
78,007
Operating profit/(loss) before
exceptional items
Acquisition-related costs
Impairment of goodwill
Revaluation of contingent consideration
Other exceptional costs
Operating profit/(loss) before
interest, tax and depreciation
Depreciation and amortisation
Operating profit/(loss)
Finance costs
Profit/(loss) before tax
Income tax credit/(charge)
Profit/(loss) after tax
8. Exceptional items
6,877
—
—
—
—
6,877
(4,777)
2,100
(203)
1,897
577
(2,841)
(528)
(1,500)
—
—
(4,869)
(345)
(5,214)
(93)
(5,307)
—
4,036
(528)
(1,500)
—
—
2,008
(5,122)
(3,114)
(296)
(3,410)
577
2,474
(5,307)
(2,833)
2,953
—
—
—
—
2,953
(2,749)
204
(110)
94
313
407
(1,847)
(465)
(2,000)
2,668
(77)
(1,721)
(73)
(1,794)
(115)
(1,909)
—
(1,909)
1,106
(465)
(2,000)
2,668
(77)
1,232
(2,822)
(1,590)
(225)
(1,815)
313
(1,502)
Acquisition-related costs
Impairment of goodwill
Revaluation of contingent consideration
Other exceptional costs
Total exceptional items
Tax (credit)/charge attributable to exceptional items
Total exceptional items after tax
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
528
1,500
—
—
2,028
(100)
1,928
465
2,000
(2,668)
77
(126)
404
278
58
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020
9. Loss before taxation
Loss before taxation is stated after charging/(crediting):
Share-based payments
Operating lease rentals:*
- land and buildings
- other
Defined contribution pension schemes
Expenses in connection with the acquisition of subsidiaries
Depreciation and amortisation
Fair value adjustments of onerous contracts
Revaluation of contingent consideration
Auditors’ remuneration:
- fees payable to the Company’s auditors for the audit of the
parent company and consolidated financial statements
- the audit of the Company’s subsidiaries**
Fees payable to the Company’s auditors for the other services:
- other services
- tax compliance services
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
64
—
—
2,882
528
5,122
670
—
31
92
34
8
43
1,690
135
2,344
465
2,822
—
(2,668)
18
106
47
8
*
IFRS 16 was implemented on 1 April 2019 using the modified retrospective method and, as a result, the comparative amounts for lease payments remain in the income statement.
**
The audit fees for the Company’s subsidiaries include VAT as some subsidiaries have a partial exemption scheme and some are not VAT registered.
10. Finance income
Bank interest received
Total finance income
11. Finance costs
Bank charges
Interest on lease liabilities
Loss on foreign exchange
Loan interest
Other finance costs
Total finance costs
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
6
6
3
3
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
10
235
2
51
4
302
15
—
—
3
210
228
Other finance costs for the 12 months to 31 March 2019 include the unwinding of the fair value adjustments to the dilapidations
provisions and contingent considerations. The fair value adjustments are based on net present values, discounted at 10%.
59
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
12. Taxation
(a) Taxation charge
Current tax expense
Current tax on loss for the period
Adjustments in respect of prior periods
Deferred tax expense
Origination and reversal of timing differences
Adjustments in respect of prior periods
Total tax credit
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
(50)
1
(49)
(542)
14
(528)
(577)
—
(31)
(31)
(186)
(96)
(282)
(313)
(b) Taxation reconciliation
The reasons for the difference between the actual tax charge for the year and the standard rate of corporation tax
in the United Kingdom applied to profit for the year are as follows:
Loss on ordinary activities before tax
Taxation at the standard UK income tax of 19% (2019: 19%)
Expenses not deductible for tax purposes
Origination and reversal of timing differences
Deferred tax asset not recognised
Adjustments in respect of prior periods
Other
Total tax credited in the income statement
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
(3,410)
(1,815)
(648)
236
(528)
362
1
—
(577)
(345)
(95)
(186)
464
(127)
(24)
(313)
(c) Deferred tax
Estimated tax losses of approximately £11,500,000 (2019: £8,000,000) are available to relieve future profits of the Group in
respect of which no deferred tax asset has been recognised due to uncertainty as to the timing and tax rate at which these losses
will be utilised against future taxable profit streams.
A deferred tax asset of £408,000 (2019: £158,000) has been recognised in relation to accelerated capital allowances and other
timing differences where utilisation against future profits is considered to be more certain.
Group
Assets
Accelerated capital allowances
Other timing differences
Total deferred tax asset
Group
Liabilities
Accelerated capital allowances
Other timing differences
Total deferred tax liability
60
2020
£000
49
359
408
2020
£000
44
1,236
1,280
2019
£000
49
109
158
2019
£000
—
14
14
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020
13. Ordinary dividends
Group and Company
Interim dividend paid for the year ended 31 March 2020 (period ended 31 March 2019: £nil)
Amounts recognised as distributions to owners of the parent
2020
£000
455
455
2019
£000
—
—
No final dividend has been approved for the year ended 31 March 2020 as at the date of approval of these financial statements.
14. Intangible assets
Group
Cost
At 1 April 2019
Additions
Acquisition of Greenbrook
At 31 March 2020
Amortisation
At 1 April 2019
Amortisation charge
At 31 March 2020
Accumulated impairment losses
At 1 April 2019
Impairment loss for the year
At 31 March 2020
Net book value
At 31 March 2020
At 31 March 2019
Group
Cost
At 1 April 2018
Additions
Acquisition of Vocare
Disposals
At 31 March 2019
Amortisation
At 1 April 2018
Amortisation charge
At 31 March 2019
Accumulated impairment losses
At 1 April 2018
Impairment loss for the year
At 31 March 2019
Net book value
At 31 March 2019
At 31 March 2018
Development
costs
£000
Computer
software
£000
Customer
contracts and
relationships
£000
Goodwill
£000
Total
£000
28,160
36,875
—
5,850
34,010
192
15,204
52,271
—
—
—
2,000
1,500
3,500
5,312
3,089
8,401
2,739
1,500
4,239
5,863
—
9,354
15,217
3,690
2,800
6,490
—
—
—
8,727
2,173
30,510
26,160
39,631
28,824
739
—
—
739
—
—
—
739
—
739
—
—
2,113
192
—
2,305
1,622
289
1,911
—
—
—
394
491
Development
costs
£000
Computer
software
£000
Customer
contracts and
relationships
£000
Goodwill
£000
Total
£000
739
—
—
—
1,950
167
—
(4)
5,863
26,563
35,115
—
—
—
—
1,597
—
167
1,597
(4)
739
2,113
5,863
28,160
36,875
—
—
—
739
—
739
—
—
1,147
475
1,622
—
—
—
491
803
1,967
1,723
3,690
—
—
—
—
—
—
—
2,000
2,000
3,114
2,198
5,312
739
2,000
2,739
2,173
3,896
26,160
26,563
28,824
31,262
61
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc 14. Intangible assets continued
Company
Cost
At 1 April 2019
Additions
At 31 March 2020
Amortisation
At 1 April 2019
Amortisation charge
At 31 March 2020
Net book value
At 31 March 2020
At 31 March 2019
Company
Cost
At 1 April 2018
Additions
At 31 March 2019
Amortisation
At 1 April 2018
Amortisation charge
At 31 March 2019
Net book value
At 31 March 2019
At 31 March 2018
Computer
software
£000
51
—
51
25
17
42
9
26
Computer
software
£000
38
13
51
10
15
25
26
28
Total
£000
51
—
51
25
17
42
9
26
Total
£000
38
13
51
10
15
25
26
28
Customer contracts and relationships represents the acquired contracts and relationships on the respective acquisitions. They
have been recognised at the discounted expected profitability of contracts over the expected life, including anticipated contract
renewals. The projected profitability has considered historic gross profit and directly attributable overheads. The contract values
are amortised on a straight-line basis over the life of the contracts as per note 4.
The Group tests goodwill annually for impairment, or more frequently if there are any indications that goodwill might be impaired.
For the periods ending 31 March 2019 and 31 March 2020, the recoverable amount of the cash-generating units (“CGUs”) was
determined based on value-in-use calculations which require the use of assumptions. The value in use was calculated by discounting
cash flow projections based on financial budgets approved by management covering a three-year period to 31 March 2023 along
with discounted cash flows into perpetuity with the assumption of no growth in EBITDA following a three-year period.
Cash flows for the impairment testing at 31 March 2020 and 31 March 2019 were discounted at a rate of 10% for all CGUs.
62
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020 14. Intangible assets continued
The assumptions used in the three-year forecast to 31 March 2023 were as follows:
Urgent Care
Revenue growth
Budgeted gross margin
% administrative expenses to revenue
Planned Care
Revenue growth
Budgeted gross margin
% administrative expenses to revenue
Year ended
31 March 2021
%
Year ended
31 March 2022
%
Year ended
31 March 2023
%
2
17
11
(37)
24
22
2
17
11
60
22
15
2
17
11
14
22
14
The assumptions noted above are determined by management, based on past performance, current knowledge of future plans, the
nature of contracts with customers and performance to date, and after taking into account the expected impact of COVID-19. Given
the nature of Urgent Care’s operations, that CGU has not been adversely affected and the projections are largely based on current
year results and historic trends. It is anticipated that Planned Care will be more significantly impacted by COVID-19 which is indicated
in the projected decline for the year ended 31 March 2021, with the CGU thereafter returning to historic growth levels.
A CGU-level summary of goodwill is shown below:
Goodwill
At 1 April 2019
Acquisition of Greenbrook
Impairment loss
At 31 March 2020
Urgent Care
£000
Other
£000
Total
£000
16,824
5,850
—
22,674
9,336
—
(1,500)
7,836
26,160
5,850
(1,500)
30,510
Sensitivity analysis
The Group has conducted a sensitivity analysis of the impairment test to changes in key assumptions used to determine the
recoverable amount for each CGU to which goodwill is allocated. The Directors believe that a reasonable possible change in the
key assumptions on which the recoverable amount of Urgent Care CGU is based would not cause the aggregate carrying amount
to exceed the aggregate recoverable amount of the related CGU and therefore no impairment would be required.
As noted above, following the impairment review the carrying amount of the Planned Care CGU was deemed to be in excess of its
recoverable amount and an impairment loss was recognised during the year. The sensitivity analysis conducted for the impairment
test on the Planned Care CGU produced the following results:
• A 1% underperformance in budgeted gross profit margin is considered reasonably possible based on past experience and would
lead to an additional impairment charge of £813,000.
• A 1% decline in forecast revenue would result in an additional impairment charge of £790,000.
• A 1% increase in the budgeted admin percentage against revenue would result in an additional impairment charge of £808,000.
The most significant assumption relates to the timing of recommencement of normalised trading and the length of the COVID-19
pandemic. As an alternative model, the Directors have projected that revenue in the year ended 31 March 2022 remains at the
level of presently-secured contracts and a return thereafter to the historic growth trend. In this scenario, a further impairment of
£4.0m would be included.
63
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
15. Property, plant and equipment
Group
Cost
At 1 April 2019
Additions
Acquisition of Greenbrook
At 31 March 2020
Depreciation
At 1 April 2019
Provided in the period
At 31 March 2020
Net book value
At 31 March 2020
At 31 March 2019
Motor
vehicles
£000
Freehold
property
improvements
£000
Plant
machinery
£000
Office
equipment
£000
Short
leasehold
property
£000
Computer
equipment
£000
Total
£000
133
—
—
133
123
7
130
3
10
1,139
—
—
1,139
1,009
81
1,090
49
130
367
7
—
374
315
28
343
31
52
1,439
77
82
1,598
1,268
121
1,389
209
171
14
1
88
103
1
23
24
79
13
2,185
5,277
312
147
2,644
1,962
264
2,226
418
223
397
317
5,991
4,678
524
5,202
789
599
The net book value of motor vehicles includes £3,000 (31 March 2019: £8,000) in relation to assets held under leases. For the
period ending 31 March 2020 these assets are considered low value and therefore have not been recognised as a right-of-use
assets under IFRS 16.
Group
Cost
At 1 April 2018
Additions
Disposals
At 31 March 2019
Depreciation
At 1 April 2018
Disposals
Provided in the period
At 31 March 2019
Net book value
At 31 March 2019
At 31 March 2018
Motor
vehicles
£000
Freehold
property
improvements
£000
Plant
machinery
£000
Office
equipment
£000
Short
leasehold
property
£000
Computer
equipment
£000
Total
£000
133
—
—
133
119
—
4
123
10
14
1,145
—
(6)
1,139
875
(3)
137
1,009
130
270
360
12
(5)
367
287
(1)
29
315
52
73
1,314
133
(8)
1,439
1,092
(6)
182
1,268
171
222
32
14
(32)
14
32
(32)
1
1
13
—
2,081
5,065
106
(2)
265
(53)
2,185
5,277
1,680
—
282
1,962
223
401
4,085
(42)
635
4,678
599
980
The net book value of motor vehicles includes £8,000 (31 March 2018: £14,000) in relation to assets held under leases.
64
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020
15. Property, plant and equipment continued
Company
Cost
At 1 April 2019
Additions
At 31 March 2020
Depreciation
At 1 April 2019
Provided in the period
At 31 March 2020
Net book value
At 31 March 2020
At 31 March 2019
Company
Cost
At 1 April 2018
Additions
At 31 March 2019
Depreciation
At 1 April 2018
Provided in the period
At 31 March 2019
Net book value
At 31 March 2019
At 31 March 2018
Office
equipment
£000
Short
leasehold
property
£000
Computer
equipment
£000
25
13
38
4
11
15
23
21
7
1
8
—
3
3
5
7
38
9
47
23
9
32
15
15
Office
equipment
£000
Short
leasehold
property
£000
Computer
equipment
£000
2
23
25
2
2
4
21
—
—
7
7
—
—
—
7
—
31
7
38
12
11
23
15
19
Total
£000
70
23
93
27
23
50
43
43
Total
£000
33
37
70
14
13
27
43
19
16. Right-of-use assets and lease liabilities
All leases are accounted for by recognising a right-of-use asset and a lease liability except for:
•
leases of low value assets;
•
leases with a duration of twelve months or less; and
•
licence arrangements falling under the scope of IFRIC 12.
IFRS 16 was adopted on 1 April 2019 without restatement of comparative figures. For an explanation of the transitional
requirements that were applied as at 1 April 2019, see note 30. The following policies apply subsequent to the date of initial
application, 1 April 2019.
Lease liabilities are measured at the present value of the contractual payments due to the lessor over the lease term, with the discount
rate determined by reference to the rate inherent in the lease unless this is not readily determinable, in which case the Group’s
incremental borrowing rate on commencement of the lease is used (see note 30). Variable lease payments are only included in
the measurement of the lease liability if they depend on an index or rate. In such cases, the initial measurement of the lease liability
assumes the variable element will remain unchanged throughout the lease term. Other variable lease payments are expensed
in the period to which they relate.
Right-of-use assets are initially measured at the amount of the lease liability, reduced for any lease incentives received, and increased
for lease payments made at or before commencement of the lease.
Subsequent to initial measurement lease liabilities increase as a result of interest charged at a constant rate on the balance outstanding
and are reduced for lease payments made. Right-of-use assets are amortised on a straight-line basis over the remaining term
of the lease or over the remaining economic life of the asset if, rarely, this is judged to be shorter than the lease term.
65
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
16. Right-of-use assets and lease liabilities continued
Right-of-use assets
Cost
At 1 April 2019
Additions
Acquisition of Greenbrook
At 31 March 2020
Depreciation
Provided in the period
At 31 March 2020
Net book value
At 31 March 2020
Lease liabilities
At 1 April 2019
Additions
Acquisition of Greenbrook
Interest expense
Lease payments
At 31 March 2020
Leasehold
property
£000
4,079
130
1,414
5,623
1,505
1,505
Group
Computer
equipment
£000
4
—
11
15
4
4
Company
Leasehold
equipment
£000
348
—
—
348
60
60
Total
£000
348
—
—
348
60
60
Total
£000
4,083
130
1,425
5,638
1,509
1,509
4,118
11
4,129
288
288
Group
Leasehold
property
£000
Computer
equipment
£000
Motor
vehicles
£000
4,017
130
1,414
234
(1,630)
4,165
4
—
11
—
(5)
10
5
—
—
1
(3)
3
Total
£000
4,026
130
1,425
235
(1,638)
4,178
Generally, there are no extension or termination options on the property or equipment leases.
Maturity analysis
Up to 3 months
Between 3 and 12 months
Between 1 and 2 years
Between 2 and 5 years
Over 5 years
Total
Short-term lease expense
Low value lease expense
Aggregate undiscounted commitments for short-term leases
66
Company
Leasehold
equipment
£000
348
—
—
9
(65)
292
Group
£000
375
1,074
458
885
1,386
4,178
Total
£000
348
—
—
9
(65)
292
Company
£000
14
44
60
174
—
292
2020
£000
88
10
60
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020
17. Investments in subsidiaries
Company
Investments in share capital of subsidiaries.
Cost
At 1 April 2019
Additions
At 31 March 2020
Net book value
At 31 March 2020
At 31 March 2019
Cost
At 1 April 2018
Additions
Adjustment to contingent consideration*
At 31 March 2019
Net book value
At 31 March 2019
At 31 March 2018
Total
£000
21,835
16,314
38,149
38,149
21,835
Total
£000
24,503
—
(2,668)
21,835
21,835
24,503
*
Investments were adjusted during the period to reflect the decrease in the fair value of contingent consideration payable on acquisition of subsidiaries.
The subsidiary companies at 31 March 2020, all of which have been consolidated, are as follows. All shares are held directly
by the Company except My Clinical Coach Ltd which is wholly owned by Totally Health Ltd, and those marked below:
Subsidiary undertakings
Totally Health Limited
My Clinical Coach Limited
Country of incorporation
Percentage of
equity capital held Nature of business
England and Wales
100%
Bespoke IT healthcare solutions
England and Wales
100%
Direct to consumer health coaching
services
Premier Physical Healthcare Limited**
England and Wales
100%
Physiotherapy and podiatry service
About Health Limited
England and Wales
100%
Dermatology service
Optimum Sports Performance Centre Limited***
England and Wales
100%
Physiotherapy service
Vocare Limited****
Totally Healthcare Limited
England and Wales
100%
Urgent care service
England and Wales
100%
Hospital insourcing service
Greenbrook Healthcare (Hounslow) Limited *****
England and Wales
100%
Urgent care service
** The subsidiaries of Premier Physical Healthcare Limited, all of which have been consolidated, at 31 March 2020 are as follows:
Subsidiary undertakings
Premier Ergonomics Limited
Core Ergonomics Limited
Country of incorporation
Percentage of
equity capital held Nature of business
England and Wales
100%
Provision of ergonomic risk assessments
England and Wales
90%
Provision of online health and safety
risk assessments
67
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
17. Investments in subsidiaries continued
Company continued
*** The subsidiaries of Optimum Sports Performance Centre Limited, all of which have been consolidated, at 31 March 2020 are as follows:
Subsidiary undertakings
Country of incorporation
Percentage of
equity capital held Nature of business
Optimum Fitness (HCS) Limited
England and Wales 100%
Optimum Occupational Health Limited
England and Wales 100%
Optimum Healthcare Solutions Limited
England and Wales 100%
Optimum Elite Fitness Limited
Optimum Physiotherapy Limited
England and Wales 100%
England and Wales 100%
Dormant
Dormant
Dormant
Dormant
Dormant
**** The subsidiaries of Vocare Limited, all of which have been consolidated, at 31 March 2020 are as follows:
Subsidiary undertakings
Country of incorporation
Percentage of
equity capital held Nature of business
Staffordshire Doctors Urgent Care Limited
England and Wales
100%
Urgent care service
Primary Care North East Community Interest Company England and Wales
66.67%
Urgent care service
Teeside Primary Care Community Interest Company England and Wales
100%
Urgent care service
Tyneside Primary Care Community Interest Company England and Wales
100%
Urgent care service
Teeside Urgent Care Community Interest Company England and Wales
100%
Urgent care service
Yorkshire Doctors Urgent Care (YDUC) Limited
England and Wales
100%
Somerset Doctors Urgent Care Limited
England and Wales
100%
Northern Doctors Offender Health Limited
England and Wales
100%
Northern Doctors Urgent Care Limited
England and Wales
100%
Bath & North East Doctors Urgent Care Limited
England and Wales
100%
Dormant
Dormant
Dormant
Dormant
Dormant
***** The subsidiary of Greenbrook Healthcare (Hounslow) Limited, which has been consolidated, at 31 March 2020 is as follows:
Subsidiary undertakings
Country of incorporation
Percentage of
equity capital held Nature of business
Greenbrook Healthcare (Surrey) Limited
England and Wales
100%
Urgent care service
The Company also has an investment in a convertible loan note in Greenbrook Healthcare (Earl’s Court) Limited which transfers significant
control over the entity to Totally plc. Greenbrook Healthcare (Earl’s Court) Limited has therefore been consolidated at 31 March 2020.
The registered office of all of the above companies is Cardinal Square West, 10 Nottingham Road, Derby, DE1 3QT.
18. Business combination
Summary of acquisition
On 20 June 2019, the Company completed the acquisition of the entire share capital of Greenbrook Healthcare (Hounslow) Limited
and the convertible loan note in Greenbrook Healthcare (Earl’s Court) Limited for a consideration of £11.5m on a cash free and
debt free basis with a normalised level of working capital. The table on page 69 sets out the adjustments to the purchase price
to reflect a normalised level of working capital which has resulted in an additional consideration payable of £4.7m.
Greenbrook is one of the leading providers of Urgent Care Centres in London. The company was acquired as part of the Group’s
stated “buy and build“ strategy and to bring new and complementary routes to the existing healthcare services offered by the
Group. Greenbrook’s urgent care services provide synergies with Totally’s existing subsidiary businesses, in particular Vocare,
and complements its business model of providing preventative and responsive healthcare in out-of-hospital settings in order
to improve people’s health and reduce NHS healthcare reliance, re-admissions and emergency admissions to hospital.
68
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020 18. Business combination continued
Summary of acquisition continued
The assets and liabilities as at 20 June 2019 arising from the acquisition were as follows:
Property, plant and equipment
Right-of-use assets
Intangible assets: customer contracts
Trade receivables and other debtors
Cash in hand
Trade and other payables
Lease liabilities
Onerous contracts
Deferred tax
Convertible loan notes
Net assets acquired
Goodwill
Total consideration
Satisfied by:
Cash
Ordinary shares issued
Carrying
amount
£000
317
1,425
—
4,712
5,781
(6,964)
(1,425)
—
(34)
(50)
3,762
Fair value
adjustment
£000
—
—
9,354
—
—
(763)
—
(529)
(1,438)
—
6,624
Fair
value
£000
317
1,425
9,354
4,712
5,781
(7,727)
(1,425)
(529)
(1,472)
(50)
10,386
5,850
16,236
13,736
2,500
16,236
The goodwill is attributable to the knowledge and expertise of the workforce and the operating synergies that arise from the Group’s
strengthened market position. Any impairment charges will not be deductible for tax purposes.
There were no acquisitions in the year ending 31 March 2019.
Acquired receivables
The fair value of acquired trade receivables is £3,766,000. The gross contractual amount for trade receivables due is £3,770,000;
no loss allowance was recognised on acquisition.
Revenue and profit contribution
The acquired business contributed revenues of £32,766,000 and a profit before tax of £483,000 (loss before tax of £590,000
including consolidation adjustments) to the Group for the period from 20 June 2019 to 31 March 2020. The consolidation adjustments
principally include the additional amortisation on the intangible assets acquired.
If the acquisition had occurred on 1 April 2019, consolidated revenue and profit before tax for the year ended 31 March 2020
would have been £42,123,000 and £787,000 (loss before tax of £721,000 including consolidation adjustments) respectively.
Net cash flow arising on acquisition
Cash consideration
Less: cash and cash equivalents acquired
£000
13,736
(5,781)
7,955
69
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
19. Inventories
Consumables
Goods for resale
20. Trade and other receivables
Trade receivables
Other receivables
Social security and other taxes
Prepayments and accrued income
Amounts owed by Group undertakings
Group
31 March 2020
£000
Group
31 March 2019
£000
21
56
77
31
37
68
Group
31 March 2020
£000
Group
31 March 2019
£000
Company
31 March 2020
£000
Company
31 March 2019
£000
5,116
63
19
6,172
—
11,370
3,156
718
42
4,690
—
8,606
—
5
19
129
575
728
153
5
36
51
432
677
The creation of provision for impaired trade receivables is included in administration costs in the income statement.
The ageing analysis of trade receivables is as follows:
Under three months
Three to six months
Group
31 March 2020
£000
Group
31 March 2019
£000
Company
31 March 2020
£000
Company
31 March 2019
£000
3,228
1,888
5,116
2,074
1,082
3,156
—
—
—
153
—
153
There has been limited experience of bad debts over the history of the Group and therefore the provision for expected credit
losses in each period is immaterial. Other non-trade receivables do not contain impaired assets.
Amounts owed by Group undertakings are repayable on demand with no fixed repayment date.
21. Trade and other payables
Current
Trade payables
Social security and other taxes
Other creditors
Corporation tax
Accruals and deferred income
Amounts owing to Group undertakings
Non-current
Accruals and deferred income
Group
31 March 2020
£000
Group
31 March 2019
£000
Company
31 March 2020
£000
Company
31 March 2019
£000
7,587
1,849
555
19
6,897
1,233
485
—
14,357
10,169
—
—
24,367
18,784
786
786
768
768
116
135
23
—
127
13,056
13,457
18
18
220
33
176
—
433
4,500
5,362
16
16
Trade payables and accruals principally comprise amounts outstanding from purchases and ongoing costs. The Directors consider
that the carrying amount of trade payables approximates to their fair value.
Amounts owed to Group undertakings are repayable on demand with no fixed repayment date.
70
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020
22. Contingent consideration
At 1 April 2018
Paid in the period
Revaluation of contingent consideration
Discount unwind in the period
At 31 March 2019
Paid in the period
At 31 March 2020
Premier Physical
Healthcare
£000
About Health
£000
968
—
(1,011)
43
—
—
—
1,587
—
(1,657)
70
—
—
—
Vocare
£000
452
(130)
—
—
322
(51)
271
Total
2020
£000
3,007
(130)
(2,668)
113
322
(51)
271
The remaining balance of contingent consideration relates to salary advances repayable quarterly as and when repaid by employees,
and is classed as current in both years.
23. Financial liabilities – borrowings
Undrawn facilities
As at 31 March 2020 and 31 March 2019 the Group had no overdraft facilities.
Other borrowings
As at 31 March 2020 and 31 March 2019 the Group had the following lease liabilities:
Current
Non-current
31 March 2020
£000
31 March 2019
£000
1,449
2,729
4,178
5
3
8
The maturity of discounted lease liabilities relating to right-of-use is assets is shown in note 16.
24. Financial instruments
The Group’s financial instruments comprise cash and various items, such as trade receivables and trade payables, that arise directly
from the Group’s activities and expose the Group to a number of risks including capital management risk, credit risk and liquidity risk.
Fair values of financial instruments
For the following financial assets and liabilities: lease liabilities, trade and other payables, trade and other receivables and cash
at bank and in hand, the carrying amount approximates the fair value of the instrument due to their short-term nature.
The Group’s activities expose it to a number of risks including capital management risk, credit risk and liquidity risk. The policies
for managing these risks are regularly reviewed and agreed by the Board.
It is the Group’s policy that no trading in financial instruments should be undertaken.
Capital management risk
The Group’s main objective when managing capital is to protect returns to shareholders by ensuring the Group will continue to
trade for the foreseeable future. The Group also aims to optimise its capital structure of debt and equity so as to minimise its cost
of capital. The Group in particular reviews its levels of borrowing and the repayment dates, setting these out against forecast cash
flows and reviewing the level of available funds.
The capital structure of the Group currently consists of cash and cash equivalents and equity attributable to holders of the parent,
comprising issued share capital, reserves and retained earnings. The Group continually looks at having the most appropriate
capital structure to enable it to maximise value to all stakeholders.
In the future, as the Group executes its expansion strategy, debt may be considered as part of the most appropriate capital structure.
If debt were to be introduced the Group will review the gearing ratio to monitor the capital return. This ratio would be calculated
as the total borrowings divided by total capital. Total borrowings include “current and non-current borrowings” as shown in the
Consolidated Statement of Financial Position. Total capital is calculated as “equity” as shown in the Consolidated Statement of
Financial Position plus total borrowings. The Group remains financed by its share capital and reserves and expects to fund future
working capital through equity. The table on page 72 details analysis of the Group’s capital management structure.
71
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
24. Financial instruments continued
Capital management risk continued
Lease liabilities
Cash and cash equivalents
Net cash
Equity
Debt to equity ratio
31 March 2020
£000
31 March 2019
£000
(4,178)
8,923
4,747
34,445
12.13%
(8)
7,520
7,512
25,879
0.03%
The increase in the debt to equity ratio for the year ended 31 March 2020 resulted from the adoption of IFRS 16, which led
to significant new liabilities being recorded in the statement of financial position from 1 April 2019 onwards.
Interest rate risk
The Group’s interest rate exposure arises mainly from the interest-bearing borrowings as disclosed in note 16. All of the Group’s
facilities were floating rates excluding interest on finance leases, which exposed the entity to cash flow risk. As at 31 March 2020
there are no loans outstanding and no undrawn overdraft facilities available to the Group. Repayments and inferred interest rates
applicable to leases recognised on right-of-use assets are fixed and there is no material exposure to interest rate risk.
Foreign exchange risk
The Group operates mostly in the United Kingdom and as such the majority of the Group and Company’s financial assets and liabilities
are denominated in Sterling, and there is no material exposure to exchange risk.
Credit risk
The Group’s credit risk primarily relates to trade and other receivables and accrued income. The amounts presented in the
statement of financial position are net of allowances for doubtful receivables made by the Group’s management.
Customer credit risk is managed by each business unit subject to the Group’s established policy, procedures and controls relating
to customer credit management. Credit limits are established for all customers and are based inter alia on credit checks. Outstanding
customer receivables are regularly monitored and an ageing analysis of trade receivables is shown in note 20.
The majority of the Group’s customer base relates to Clinical Commissioning Groups and, of the trade receivables outstanding
at 31 March 2020, 88% has been recovered as at the date of this report. Given the nature of this customer base, it is not
anticipated that COVID-19 will lead to a material increase in expected credit losses.
Liquidity risk
Cash balances and borrowings are managed so as to maximise interest earned and minimise interest paid, while maintaining the
liquidity requirements of the business. When seeking borrowings, the Directors consider the commercial terms available and,
in consultation with their advisers, consider whether such terms should be fixed or variable and are appropriate to the business.
The Group has consistently had net current liabilities in recent reporting periods which reflects the nature of the contractual
terms with customers and suppliers. Further detail on the ageing analysis of trade receivables is shown in note 20.
The table below analyses the Group’s financial liabilities into relevant maturity groupings based on the remaining period at the balance
sheet date to the contractual maturity date. The amounts disclosed in the table below are the contractual undiscounted cash flows.
Less than one year
Between one and two years
Between two and five years
Over five years
31 March 2020
Trade and
other payables
£000
Lease liabilities
£000
31 March 2019
Total
£000
Trade and
other payables
£000
Lease liabilities
£000
22,189
—
1,558
—
23,747
1,573
527
1,034
1,523
4,657
23,762
15,433
527
2,592
1,523
—
1,558
—
28,404
16,991
5
3
—
—
8
Total
£000
15,438
3
1,558
—
16,999
72
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020
25. Share capital and reserves
(a) Share capital
Allotted, called up and fully paid (2019: 59,795,172)
182,186,111 ordinary shares of 10p each
2020
2019
18,219
5,979
The ordinary shares carry full voting rights, the right to attend general meetings of the Company and full rights to receive
dividends. The shares do not confer any right of redemption.
(1) In June 2019, the Company issued 97,390,939 new ordinary shares of 10p each, for total proceeds of £9,739,000.
(2) In June 2019, the Company issued 25,000,000 new ordinary shares of 10p each as part of the consideration for the acquisition
of Greenbrook Healthcare (Hounslow) Limited and Greenbrook Healthcare (Surrey) Limited.
(b) Loss/earnings per share
Loss before exceptional items
Effect of exceptional items
Loss attributable to owners
of the parent
12 months to 31 March 2020
12 months to 31 March 2019
Earnings
£000
(905)
(1,928)
Basic loss
per share
(0.58)p
(1.24)p
Diluted
loss per
share
(0.58)p
(1.24)p
Earnings
£000
(1,224)
(278)
Basic loss
per share
(2.05)p
(0.46)p
Diluted
loss per
share
(2.05)p
(0.46)p
(2,833)
(1.82)p
(1.82)p
(1,502)
(2.51)p
(2.51)p
Weighted average number of ordinary shares
Dilutive effect of shares from share options
Fully diluted weighted average number of ordinary shares
2020
£000
2019
£000
155,696
59,795
—
—
155,696
59,795
Basic earnings/(loss) per share is calculated by dividing the profit/(loss) attributable to equity holders of the Company by the
weighted average number of ordinary shares in issue during the year. Dilutive potential ordinary shares are those share options
granted to employees where the exercise price is less than the average market price of the Company’s ordinary shares during the
period. For diluted earnings per share the weighted average number of ordinary shares in issue is adjusted to assume conversion
of all dilutive potential ordinary shares unless there is a loss before exceptional items. As the Group has made a loss in the period,
all share options and warrants are anti-dilutive and therefore have no impact on the calculation of diluted loss per share.
(c) Share premium account
The share premium account represents the amounts received by the Company on the issue of ordinary shares that are in excess
of the nominal value of the issued shares. Directly attributable issue costs are charged to the share premium account.
During the year the Company’s share premium account was cancelled, confirmed by an order of the High Court of Justice
pursuant to Section 648 of the Companies Act 2006. Distributable reserves of £16,408,000 arose upon cancellation, which
became effective on 5 November 2019.
(d) Retained earnings
This reserve records the accumulated profits and losses of the Group less dividends paid. Effective on 5 November 2019, the
Company’s share premium account was cancelled, confirmed by an order of the High Court of Justice pursuant to Section 648
of the Companies Act 2006.
73
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
25. Share capital and reserves continued
(e) Share options
During the year to 31 March 2020, 3,382,200 share options were granted under a SAYE scheme. Details of all options in issue
during the period are as follows:
Grant date
11/11/2015
11/11/2016
29/12/2017
31/01/2018
31/01/2018
20/06/2019
31/12/2019
Exercise period
10 years
3 years
3 years
3 years
3 years
3 years
3 years
44.0p
46.0p
27.0p
40.5p
40.5p
0.0p
10.0p
Exercise
price
Outstanding
at start of period
Issued
in period
Residual at
31 March 2020
Exercisable at
31 March 2020
250,000
77,476
1,345,299
263,000
202,000
—
—
—
—
—
Surrendered/
cancelled
in period
—
(782)
(877,310)
—
—
250,000
76,694
467,989
263,000
202,000
— 10,500,000
(1,500,000)
9,000,000
—
3,382,200
(36,000)
3,346,200
250,000
76,694
—
—
—
—
—
2,137,775
13,882,200
(2,414,092)
13,605,883
326,694
(f) Share warrants
Details of all warrants in issue during the year to 31 March 2020 are as follows:
Grant date
30/09/2008
08/10/2009
Exercise period
Exercise price
Outstanding at
start of period
Issued in period
No expiry date
Within 10 years of grant date
100p
100p
350,000
1,667
351,667
—
—
—
Expired/
exercised
in period
Residual at
31 March 2020
—
350,000
(1,667)
(1,667)
—
350,000
26. Share-based employee remuneration
During the period ended 31 March 2020, the Group and Company had three share-based payment arrangements as described below.
(a) Employee Share Options
In January 2018, the Company introduced the Totally plc Company Share Option Plan to replace the existing EMI Scheme. The Plan
is designed to help recruit and retain employees of the Group and motivate them to achieve the Group’s business objectives. The
Plan allows the Company to grant tax-effective incentives to employees known as CSOP options. Options granted will vest on the
third anniversary of the date of grant and will expire on the tenth anniversary of the date of the grant.
The Company also has options in issue under the Totally plc Unapproved Share Option Plan. Options granted under this scheme
will vest on the third anniversary of the date of the grant and will expire on the tenth anniversary of the date of the grant.
The estimated fair value of each option has been calculated using the Black Scholes option pricing model for the different options
granted. The estimated fair value of outstanding options varies between 10.0p and 11.0p. The model inputs for the 2019 scheme
are share price at grant date, exercise price, expected volatility of 29%, contractual life of three years, and a risk-free interest rate
of 4%. A reconciliation of option movements over the period is shown in note 25.
The volatility of the Company’s share price on each date of grant was calculated as the average of the standard deviations of daily
continuously compounded returns on the stock of the Company, calculated back over a period commensurate with the expected
life of the option. The risk-free rate used is the yield to maturity on the date of grant, with term to maturity equal to the expected
life of the option. It is assumed that options will be exercised within two years of the date on which they vest.
74
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020Notes to the financial statements continuedFor the year ended 31 March 2020
26. Share-based employee remuneration continued
(a) Employee Share Options continued
Outstanding at 1 April
Granted
Exercised
Surrendered/cancelled
Outstanding at 31 March 2020/31 March 2019
Range of exercise price (pence)
Weighted average exercise price (pence)
Weighted average remaining life years – expected
Weighted average remaining life years – contractual
31 March 2020
Number
000s
31 March 2020
Weighted
average price
Pence
31 March 2019
Number
000s
31 March 2019
Weighted
average price
Pence
2,138
3,382
—
(914)
4,606
33
10
—
26
17
2,442
—
—
(304)
2,138
34
—
—
41
33
31 March 2020
31 March 2019
10–46
27–46
17
3
3
33
4
4
(b) Warrants
The estimated fair value of each warrant was calculated using the Black Scholes option pricing model for differing warrants granted.
The estimated fair value of warrants varied between 0.01p and 0.49p. The full cost of the warrants was recognised at the date of grant.
(c) Save As You Earn (“SAYE”) scheme
The SAYE was introduced in December 2016 following shareholder approval. Options are granted for a period of three years.
Options are exercisable at a price based on the quoted market price of the Company’s shares at the time of invitation, discounted
by up to 20%. Options are forfeited if the employee leaves the Group before the options vest which impacts on the number of
options expected to vest. If an employee stops saving but continues in employment, this is treated as a cancellation which results
in an acceleration of the share-based payment charge in the income statement.
Principal terms of SAYE schemes
Number of options
Maximum award limit under the plan will be limited to a contribution of £500 per month
Exercise price
Vesting period
10p, 27p and 46p
Three years
Performance conditions
None
Expiry conditions
Options are forfeited if the employee leaves the Group before the options have vested
The Group recognised the following share-based payment expenses during the period:
Expense arising from issue of share options – equity settled
Expense arising from issue of share warrants – equity settled
SAYE
31 March 2020
£000
31 March 2019
£000
—
—
64
64
10
—
33
43
75
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
Notes to the financial statements continued
For the year ended 31 March 2020
26. Share-based employee remuneration continued
(d) Long-term Incentive Plan (2019) (“LTIP”)
The Totally plc Long-Term Incentive Plan (2019) was established during the year. The purpose of the Plan was to recognise
the importance in retaining certain key individuals to drive the integration and development of the business for the future.
Shareholders approved the LTIP arrangements with effect from the Greenbrook Admission Document. Awards will vest on a
sliding scale dependent on the achievement of share price hurdles measured at the vesting date from 25% of any award at a
share price of 35p to 100% at 55p per share. Full details of the Plan arrangements can be found from page 126 of the Greenbrook
Admission Document, which can be found at www.totallyplc.com/investor-relations/reports-documents.
The estimated fair value of each option has been calculated using the Monte Carlo option pricing model for the different options
granted. The model inputs are share price at grant date, exercise price, expected volatility of 56.1%, expected dividends expressed
as a dividend yield of 2.5%, contractual life of three years, and a risk free interest rate of 0.57%. A reconciliation of option movements
over the period is shown in note 25.
Outstanding at 1 April
Granted
Exercised
Surrendered/cancelled
Outstanding at 31 March 2020
Range of exercise price (pence)
Weighted average exercise price (pence)
Weighted average remaining life years – expected
Weighted average remaining life years – contractual
27. Company statement of changes in equity
Company
At 1 April 2018
Loss for the period
Share-based credit
At 31 March 2019
Loss for the period
Cancellation of share premium account
Share issue
Expenses attached to equity issue
Dividend paid
Share-based credit
At 31 March 2020
31 March 2020
Number
000s
—
10,500,000
—
(1,500,000)
9,000,000
Retained
earnings
£000
(1,784)
(2,511)
43
(4,252)
(3,637)
16,408
—
(450)
(455)
64
31 March 2020
Weighted
average price
Pence
—
—
—
—
—
31 March 2020
—
—
3
3
Equity
shareholders’
funds
£000
20,603
(2,511)
43
18,135
(3,637)
—
12,240
(450)
(455)
64
7,678
25,897
Share
capital
£000
Share
premium
£000
5,979
16,408
—
—
—
—
5,979
16,408
—
—
12,240
—
—
—
18,219
—
(16,408)
—
—
—
—
—
The loss for the period dealt with in the financial statements of the parent company is shown above.
As permitted by Section 408 of the Companies Act 2006, no separate income statement is presented in respect of the parent company.
76
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020
28. Employee information
The average number of persons employed by the Group (including Directors) during the period, analysed by category, was as follows:
Operational
Support
Staff costs for the above employees and Directors:
Wages and salaries
Social security costs
Share-based payments
Pension costs
The remuneration of the Directors together with other key management personnel is set out below:
Short-term employee benefits
Post-employment benefits
Share-based payments
Of which Directors’ remuneration is as follows:
Short-term employee benefits
Post-employment benefits
Share-based payments
Number of employees
12 months to
31 March 2020
12 months to
31 March 2019
1,403
249
1,652
1,411
192
1,603
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
37,180
3,374
64
2,882
43,500
32,780
2,919
43
2,344
38,086
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
1,944
112
20
2,076
1,497
106
12
1,615
12 months to
31 March 2020
£000
12 months to
31 March 2019
£000
711
36
17
764
423
42
17
482
Further information about the remuneration of individual Directors is provided in the audited part of the Directors’ Remuneration
Report on pages 35 to 37.
The share-based remuneration for employees and Directors was as follows:
Share-based
payments
SAYE
12 months to 31 March 2020
12 months to 31 March 2019
Key
management
personnel
£000
Directors
£000
15
2
17
2
1
3
Staff
£000
13
31
44
Total
£000
Directors
£000
Key
management
personnel
£000
30
34
64
16
1
17
(4)
(1)
(5)
Staff
£000
(3)
33
30
Further information about share-based payments is provided in note 25.
Total
£000
9
33
42
77
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
Notes to the financial statements continued
For the year ended 31 March 2020
29. Related party transactions
Group
The Group has taken advantage of the exemption available under IAS 2 Related Party Disclosures not to disclose details of transactions
between Group undertakings which are eliminated on consolidation.
Key management compensation is shown in note 28.
Company
Funds are transferred within the Group dependent on the operational needs of individual companies and the Directors do not
consider it meaningful to set out the gross amounts of transfers between companies. In the year to 31 March 2020 an impairment
charge of £478,000 was made against an amount owed to the Company by a subsidiary. No such impairment was made in the year
to 31 March 2019. Amounts owed to and from subsidiary undertakings are shown in notes 19 and 20.
As at 31 March 2020 there were no loans to Directors (2019: £nil).
30. Effects of changes in accounting policies
The Group adopted IFRS 16 with a transition date of 1 April 2020. The Group has chosen not to restate comparatives on adoption
and, therefore, the revised requirements are not reflected in the prior year financial statements. Rather, these changes have been
processed at the date of initial application and recognised in the opening equity balances. Details of the impact this standard has
had are given below.
IFRS 16 provides a single lessee accounting model, requiring the recognition of assets and liabilities for all leases, together with
options to exclude leases where the lease term is twelve months or less, or where the underlying asset is of low value. IFRS 16
substantially carries forward the lessor accounting in IAS 17, with the distinction between operating leases and finance leases
being retained. The Group does not have significant leasing activities acting as a lessor.
As a lessee, the Group previously classified leases as operating or finance leases based on its assessment of whether the lease
transferred substantially all of the risks and rewards of ownership. Under IFRS 16, the Group recognises right-of-use assets and
lease liabilities for most leases. However, the Group has elected not to recognise right-of-use assets and lease liabilities for some
leases of low value assets based on the value of the underlying asset when new or for short-term leases with a lease term of
twelve months or less.
On adoption the Group recognised right-of-use assets at an amount equal to the lease liability, adjusted by the amount of any
prepaid or accrued lease payments. Lease liabilities are measured at the present value of the remaining lease payments, discounted
using the Group’s incremental borrowing rate of 2.49% as at 1 April 2020. The Group’s incremental borrowing rate is the rate
at which a similar borrowing could be obtained from an independent creditor under comparable terms and conditions.
The impact of adopting IFRS 16 on the Consolidated Statement of Profit or Loss is to increase profit before exceptional items
by £1,636,000, increase depreciation by £1,509,000 and increase finance costs by £235,000.
The impact of adopting IFRS 16 on the Statement of Financial Position can be seen below:
Assets
Right-of-use assets
Prepaid rent
Liabilities
Lease liabilities
31 March 2019
£000
IFRS 16
£000
1 April 2019
£000
—
57
57
—
4,083
(57)
4,026
4,083
—
4,083
4,026
4,026
The impact of adopting IFRS 16 on the Consolidated Cash Flow Statement is to increase operating cash flows and decrease
financing cash flows by £1,744,000 respectively.
78
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020
30. Effects of changes in accounting policies continued
The following table reconciles the minimum lease commitments disclosed in the Group’s 31 March 2019 financial statements
to the amount of lease liabilities recognised on 1 April 2019.
Minimum operating lease commitment at 31 March 2019
Previously unrecognised commitments
Less: short-term leases not recognised under IFRS 16
Less: low value leases not recognised under IFRS 16
Less: licences not considered leases under IFRS 16
Undiscounted lease payments
Less: effect of discounting using the incremental borrowing rate
Lease liability as at 1 April 2019
1 April 2019
£000
5,295
151
(71)
(17)
(434)
4,924
(898)
4,026
The impact of adopting IFRS 16 on the Company Statement of Profit or Loss is to increase profit before exceptional items by
£66,000, increase depreciation by £61,000, and increase finance costs by £9,000.
The impact of adopting IFRS 16 on the Company Statement of Financial Position can be seen below:
Assets
Right-of-use assets
Liabilities
Lease liabilities
31 March 2019
£000
IFRS 16
£000
1 April 2020
£000
—
—
348
348
348
348
The impact of adopting IFRS 16 on the Company Cash Flow Statement is to increase operating cash flows and decrease financing
cash flows by £70,000 respectively.
The following table reconciles the minimum lease commitments disclosed in the Company’s 31 March 2019 financial statements
to the amount of lease liabilities recognised on 1 April 2019.
Minimum operating lease commitment at 31 March 2019
Less: short-term leases not recognised under IFRS 16
Undiscounted lease payments
Less: effect of discounting using the incremental borrowing rate
Lease liability as at 1 April 2019
1 April 2020
£000
368
(2)
366
(18)
348
31. Changes in liabilities arising from financing activities
The table below details changes in the Group’s liabilities arising from financing activities, including both cash and non-cash changes.
Liabilities arising from financing activities are those for which cash flows were, or future cash flows will be, classified in the Group’s
consolidated cash flow statement as cash flows from financing activities.
Lease liabilities
Note
16
Non-cash
changes
01 April
2019
Reported
£000
IFRS 16
implementation
£000
8
8
4,026
4,026
Other non - cash changes
Cash changes
01 April
2019
Restated
£000
4,034
4,034
Acquisition
of subsidiary
£000
1,425
1,425
New
leases
£000
130
130
Other
changes
£000
227
227
Financing
cash flows
£000
(1,638)
(1,638)
31 March
2020
£000
4,178
4,178
The financing cash flows represent the payments for lease liabilities as presented in the cash flow statement.
Other changes include interest accruals and payments.
79
FINANCIAL STATEMENTSAnnual Report for the year ended 31 March 2020 Totally plc
Company information
Company information
Registration number
03870101 (England and Wales)
Directors
Bob Holt (Chairman)
Wendy Lawrence (CEO)
Lisa Barter (Finance Director)
Gloria Cooke (Clinical Quality Director)
Michael Steel (Executive Director)
(appointed 20 June 2019 and resigned 10 July 2020)
Tony Bourne (Non-Executive Director)
Mike Rogers (Non-Executive Director)
Group Company Secretary
John Charlton
Legal advisers
BPE Solicitors LLP
St James House
St James Square
Cheltenham
GL50 3PR
Tel: +44 (0)1242 224433
Registered office
Cardinal Square West
10 Nottingham Road
Derby
DE1 3QT
Tel: +44 (0)20 3866 3330
Auditors
RPG Crouch Chapman LLP
62 Wilson Street London
EC2A 2BU
Tel: +44 (0)20 7782 0007
Nominated adviser and joint broker
Allenby Capital Limited
5 St. Helen’s Place
London
EC3A 6AB
Tel: +44 (0)20 3328 5656
Joint broker
Canaccord Genuity Ltd
88 Wood Street
London
EC2V 7QR
Tel: +44 (0)20 7523 8000
Financial PR
Yellow Jersey PR
7th Floor, 22 Upper Ground
London
SE1 9PD
Tel: +44 (0)203 735 8918
Bankers
National Westminster Bank Plc
9th Floor
3 Shortlands
Hammersmith
London W6 8DA
Registrar
Share Registrars Limited
The Courtyard
17 West Street
Farnham
Surrey
GU9 7DR
Tel: +44 (0)125 282 1390
Discover more online
totallyplc.com
Follow our business on LinkedIn
linkedin.com/company/totally-plc
Follow our corporate news feeds on Twitter
@totallyplc
80
FINANCIAL STATEMENTSTotally plc Annual Report for the year ended 31 March 2020 CBP003913
Totally plc’s commitment to environmental issues is
reflected in this Annual Report, which has been printed
on GalerieArt Satin, an FSC® certified material.
This document was printed by Park Communications using
its environmental print technology, which minimises the
impact of printing on the environment, with 99% of dry
waste diverted from landfill. Both the printer and the paper
mill are registered to ISO 14001.
T
o
t
a
l
l
y
p
l
c
A
n
n
u
a
l
R
e
p
o
r
t
f
o
r
t
h
e
y
e
a
r
e
n
d
e
d
3
1
M
a
r
c
h
2
0
2
0
Totally plc
Cardinal Square West
10 Nottingham Road
Derby
DE1 3QT
+44 (0)20 3866 3330
info@totallyplc.com