2019 2020
TRIAD GROUP PLC
Annual Report and Accounts
20202021
TRIAD GROUP PLC / ANNUAL REPORT AND ACCOUNTS
Financial Highlights:
REVENUE FOR THE YEAR ENDED
31 March 2021:
2020:
£17.8m
GROSS PROFIT
31 MARCH 2021:
2020:
£2.9m
GROSS PROFIT AS A PERCENTAGE OF REVENUE
31 MARCH 2021:
2020:
21.4%
PROFIT/(LOSS) BEFORE TAX
31 MARCH 2021:
2020:
(£0.6m)
PROFIT/(LOSS) AFTER TAX
31 MARCH 2021:
£0.7m
CASH RESERVES
31 MARCH 2021:
2020:
2020:
£3.8m
14.7%£3.8m£4.9m£19.4m£0.6m(£0.8m) Table of contents
Triad Group Plc | Annual Report for the year ended 31 March 2021
02 Strategic report
13 Directors’ report
16 Corporate governance report
22 Directors’ remuneration report
29
Independent auditors’ report to the members of Triad Group Plc
36 Statements of comprehensive income and expense
37 Statements of changes in equity
38 Statements of financial position
39 Statements of cash flows
40 Notes to the financial statements
59 Five year record
60 Shareholders’ information and financial calendar
61 Corporate information
the Group has been steadily exiting from lower value and
non-core activities in the resourcing area. Combined, this
has resulted in a much clearer focus for the business going
forwards and has also brought rewards in the guise of much
improved gross margin. Gross margin has increased from
14.7% of revenue in the previous year to 21.4% in the period.
Indeed, gross profit as a percentage of revenue in the
second half of the year reached 25.5% versus 14.9% for the
same period of the previous year. Whilst revenue reduced
in the year by £1.6m, the growth of consulting assignments
at an average margin percentage of 33% and the reduction
in contractor assignments and non-core business at an
average of 14%, has materially increased gross profit.
The Group successfully utilised its in-house resourcing
capability to support the recruitment of a net additional 21
consultants during the period. Further, consultant utilisation
increased in the year from 49% to 63% and, with the growth
in headcount, consultant days billed increased year on year.
Our new recruits come from a number of disciplines, notably
business analysts, project managers, software engineers,
user research consultants and delivery managers.
Strategic report
Financial highlights
•
Revenue for the year ended 31 March 2021: £17.8m
(2020: £19.4m)
• Gross profit: £3.8m (2020: £2.9m)
•
Gross profit as a percentage of revenue: 21.4%
(2020: 14.7%)
• Profit before tax: £0.6m (2020 Loss: £0.6m)
• Profit after tax: £0.7m (2020 Loss: £0.8m)
• Cash reserves: £4.9m (2020: £3.8m)
Chairman’s statement
Dr John Rigg
Financial headlines
For the year ended 31 March 2021 the Group reports
revenue of £17.8m (2020: £19.4m). The gross profit as
a percentage of revenue has increased to 21.4% (2020:
14.7%) and profit before tax was £0.6m (2020 Loss: £0.6m).
Profit after tax was £0.7m (2020 Loss: £0.8m) reflecting
the increase in the deferred tax asset (see page 11). Cash
reserves have increased to £4.9m (2020: £3.8m). The
effects of the Covid-19 pandemic upon both financial results
in 2021 and current trading are set out on pages 8 and 14.
Gross profit has increased by £0.9m during the year due
to an increase in higher margin consultancy engagements,
particularly in the public sector (see note 4). Revenue in
the year has reduced by a net £1.6m, mainly due to the
reduction in private sector low margin contractor led
assignments. Gross profit as a percentage of revenue has
subsequently increased significantly by 6.7%, reflecting the
improvements in both the ratio of consultants to contractors
on consultancy engagements and the focus upon higher
margin core business. Cash has also increased significantly
by £1.1m due to the profit in the year and improvements in
working capital.
Overview of results
I am delighted to report a very strong set of results,
delivered during a year of unprecedented global challenges.
The Group has worked almost entirely on a remote basis
during the period, and I am also pleased to confirm that we
experienced no significant Covid-19 related illnesses during
that time.
The Group’s return to profit has been accompanied by some
significant progress on the strategic front. Reinforcing the
Group’s reputation as a consultancy, trusted by clients to
deliver tangible results from their technology investments,
we have significantly increased the number of permanent
fee-earning consultants during the period. At the same time,
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| Triad Group Plc Annual Report and Accounts 2021
Strategic report
It was very pleasing to note some substantial successes
during the year, including opportunities with Ministry of
Justice, Department for Business, Energy & Industrial
Strategy, Ofgem, Department for Transport, Renewable
Energy Systems Ltd and Westcoast Ltd. In all of these
situations, Triad’s reputation for delivery excellence has been
a key factor in client decisions to place their trust in us.
Outlook
The Group is looking to build on the momentum created
during the previous year. Several of the recently won
contracts are still ramping up and significant further
recruitment is planned to service demand on these and the
new work we hope to win.
The clear emphasis of the business going forward is on
consultant led engagements where we can add value
to our clients by minimising the risk of their technology
investments. All of our business development effort is
organised to underpin this mission and we are optimistic
about securing more work across both the public sector and
the private sector.
The Group remains debt free except for lease liabilities
arising due to the application of IFRS 16 and enjoys strong
reserves of cash.
Dividend
Recognising the strength of this year’s performance and the
Group’s confidence in the near future, the Board proposes a
dividend of 2p per share (2020: nil per share).
Employees
On behalf of the Board of Directors, I would like to thank
all of the staff (including our 20+ new starters) for their
commitment and contribution during a very challenging year.
John Rigg
Executive Chairman
14 June 2021
Triad Group Plc Annual Report and Accounts 2021
| 3
Strategic report
Managing Director’s statement
Adrian Leer
Revenue in the year reduced by £1.6m to £17.8m (2020:
£19.4m) as the business focussed on higher margin
consultancy assignments. Gross profit increased
significantly by 33% to £3.8m (2020: £2.9m) reflecting the
long-term strategy to improve both the ratio of consultants
to contractors on consultant led engagements and the focus
upon higher margin core business. Due to the continued
efforts in these areas, the Group made a return to profit
before tax in the year of £0.6m (2020: loss of £0.6m). The
Group also increased cash reserves by £1.1m to £4.9m
(2020: £3.8m) with an improved trade debt profile and no
external funding requirements.
Business commentary
It has been an invigorating and exciting year full of significant
challenges. The outbreak of Covid-19 and particularly the
ensuing restrictions have had a huge impact on our business,
and it is probably the most significant in many years. The
response of the organisation has been magnificent, with a
seamless conversion from largely office-based working to
completely home-based working achieved overnight.
The demands of supporting the remote, distributed
workforce have led to a better connected and more informed
organisation, thanks to the new communications channels
established. Engendering a sense of the Triad family has
been crucial not only for the health and wellbeing of existing
staff but also for those 20+ new recruits who joined in the
last year. I am pleased to say that engagement levels have
never been better, and our teams have responded very
positively to the requirement to deliver outstanding digital
services on a remote basis.
We are on a mission to become one of the UK’s favourite
technology consultancies. During the year, this mission
has necessitated a determined move away from pure-play
recruitment and resourcing to allow us to concentrate fully
on our technology consulting activities. We are already
seeing the benefits of this approach coming through in our
gross margin and profit metrics. Our in-house resourcing
function is focused on driving our permanent consultant
headcount, augmented only where necessary with associate
resources. Having control of the human resources supply
chain from end to end gives us an important competitive
advantage as well as speed and agility that organisations
reliant on third parties do not enjoy.
Successes during the year included winning places on a
number of frameworks including two at Ofgem for a range
of delivery management services, the pan-Governmental
Artificial Intelligence framework, and the latest editions of
4
| Triad Group Plc Annual Report and Accounts 2021
Digital Outcomes & Specialists (DOS 5) and G-Cloud 12.
Our G-Cloud offering has been expanded to offer a wider
range of 17 services and has already generated success
at organisations like Department for Business, Energy &
Industrial Strategy for whom we have delivered a number of
project-based services.
We were extremely pleased to emerge as winners of the
Project Management Delivery Partner lot for the Ministry
of Justice (MoJ) Digital & Technology team’s invitation to
tender, and work started on this contract in the new financial
year. We expect to be involved in the significant programmes
of work in play across the MoJ estate over the next two
years. Elsewhere at MoJ, the production services contract
was extended twice meaning that it ran throughout the
financial year. A procurement exercise was run during the
period to secure a supplier who would take that service
into a “business as usual” state at the completion of the
programme. Regrettably, we learned at the beginning of the
new financial year that MoJ had selected another supplier
for this role.
Two significant developments at Department for Transport
(DfT) were underpinned by Triad expertise. Both within the
RTFO (Renewable Transport Fuel Obligation) section of
DfT, we helped the team to successfully launch the new
GOS (Greenhouse Gas Operating System) system which
supports the regulation of greenhouse gases. We helped
steer this through Government assessment to move it from
Beta status to a fully live service. We were also selected to
perform a discovery assessment for the older ROS (RTFO
Operating System) system, originally written by Triad many
years ago, and subsequently won the contract to progress
from discovery phase to alpha phase and hopefully through
to live completion.
After a Covid-related delay, work started on a significant
project with Westcoast Ltd (one of the UK’s leading
technology distributors) to modernise their legacy system
whilst allowing business to operate uninterrupted. Eventually
starting in February 2021, we expect work to continue well
into the next financial year.
Work also started with Renewable Energy Systems (RES)
Ltd to provide a contemporary project management system,
based on the Japanese Obeya principles, that supports
their delivery of renewable energy programmes. This project
involves use of Workpoint software to complement Microsoft
365, and we see great potential through our partnership with
Workpoint to deliver similar projects in the future.
We have been engaged by Marine Stewardship Council
(MSC) to help with the development and delivery of their
Strategic report
assessment platform. Across DfT, Ofgem, RES and MSC we
are developing a significant presence within organisations
and sectors that drive sustainability of resources, and we
see this as an increasingly significant source of opportunity.
We did not experience any significant impact from the roll-
out of the Off Payroll (IR35) legislation thanks to our careful
assessment and thorough planning process. As we alter the
mix of permanent staff and contractors, the exposure to IR35
reduces. Where possible, we are offering clients – particularly
those in Central Government – a fully “on payroll” team,
thereby eliminating for the client any risk of non-compliance.
I am pleased to report that during the year the Group
became a Disability Confident employer and a signatory to
the Tech Talent Charter. Both developments underscore
our commitment to the ongoing development of a diverse
workforce that feels fully included in the work of the Group.
I am also very pleased to note our support of the charity
Action for Children last year through their “Boycott your bed”
campaign. This support continues into the new financial year.
The new financial year sees the Group operating with more
permanent fee-earning consultants than at any time in the last
10 years and with a renewed focus on being the technology
consultancy of choice. The Group has expanded its business
development capacity to include a focus on areas such as
financial services and technologies such as blockchain, in
addition to an increased focus on the public sector.
I would also like to thank the staff for their incredible support
and contributions during the year.
Adrian Leer
Managing Director
14 June 2021
Triad Group Plc Annual Report and Accounts 2020
| 5
Strategic report
Organisation overview
Triad Group Plc is engaged in the provision of information
technology consultants to deliver technology-enabled
business change to organisations in the public sector, private
sector, and not-for-profit sector.
Business model
The Group provides a range of consultancy services
to clients to help them deliver a tangible return on their
investment in technology. Our primary engagement model
is to deliver these services via our permanent consultants,
sometimes augmented by carefully selected associates.
We rely upon our in-house resourcing team to provide both
permanent and associate staff, ensuring that we maintain
tight control of our supply chain and quality at all times.
Our services span the delivery life cycle from high level
consulting, early strategy, programme management, project
delivery, software delivery, and support activities.
The Group operates mainly in the United Kingdom. Our
workforce is increasingly distributed across the UK too, and
we have permanent office space in Godalming (registered
office) and Milton Keynes.
Principal objectives
The principal objectives of the Group are to;
•
•
Provide clients with industry leading service in our core
skills.
Achieve sustainable profitable growth across the
business and increase long-term shareholder value.
The key elements of our strategy to achieve our objectives are;
To provide a range of specialist services relevant to our
clients’ business
•
•
Our services include consultancy, change leadership,
project delivery, software development and business
insights. Further capacity and expertise is provided via
our associate network.
We continue to adopt a “business first, technology
second” approach to solving our clients’ problems. A
cornerstone of our service offer is our consultancy
model, offering advice and guidance to clients in terms
of technology investments.
To develop long-term client relationships across a broad
client base
•
Enduring client relationships fuel profitability. A
hallmark of our recent trading has been the frequency
of repeat business, which itself has been a function
of outstanding delivery and proactive business
development within existing accounts.
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| Triad Group Plc Annual Report and Accounts 2021
•
•
Our consistent track record in this regard is our major
asset when developing propositions for new clients,
along with the use of case studies and references.
We have structured our service offering to enable
clients to engage early, thus enabling the building of
trust and confidence from the outset.
To work with partners
•
Our strategy includes working with carefully chosen
partners operating under their client frameworks in
addition to the frameworks on which Triad is listed. This will
expose more opportunities whilst reducing the cost of sale.
To leverage group capability and efficiency to increase
profitability
•
•
•
We continue to develop synergies across the Group’s
activities both externally and internally, driving better
outcomes for clients whilst improving efficiency and
effectiveness. The management team sets objectives to
ensure that these synergies are exploited.
We enable our clients to benefit from access to a full range
of IT services, delivered through a single, easy to access,
point of sale.
We will continue to provide the highest quality of service
to our customers through our teams of skilled consultants
and market experts.
Principal risks and uncertainties
The Group’s business involves risks and uncertainties,
which the Board systematically manages through its
planning and governance processes.
The Board has conducted a robust assessment of the
principal risks facing the Group, examining the Group’s
operating environment, scanning for potential risks to the
health and wellbeing of the organisation. The Directors
factor into the business plan the likelihood and magnitude
of risk in determining the achievability of the operational
objectives. Where feasible, preventive and mitigating
actions are developed for all principal risks.
Senior management review the risk register and track the
status of these risk factors on an on-going basis, identifying
any emerging risks as they appear. Regular meetings are
held between the Executive Chairman and the Managing
Director to ensure risks are identified and communicated.
The outputs of this management review form part of the
Board’s governance process, reviewed at regular Board
meetings. When emerging risks arise these are reviewed
by senior management on an immediate basis and
communicated to the Board on a timely basis.
Strategic report
The principal risks identified are:
Covid-19
The business was proven to be agile and robust through the
pandemic. The main risks that remain and potentially could
occur, are a reduction in new business pipeline opportunities,
payment delays and the recovery of debtor balances.
These risks were met head-on during 2021 and the same
mitigating actions taken during the year are being applied
– the focus on servicing clients remotely and effectively, a
very strong focus on short-term forecasting, and improving
cash collection. In a competitive marketplace driven by the
pandemic, employee engagement is also key to mitigating
the risks presented by Covid-19. The continuous review of
flexible working patterns, remuneration and the mix of on-
site and remote working is critical.
IT services market
The demand for IT services is affected by UK market
conditions. This includes, for example, fluctuations in political
and economic uncertainty and the level of public sector
spending. Negative impacts can reduce revenue growth and
maintenance due to the loss of key clients, reduction in sales
pipelines and reduction in current services. The creation of
new services, acquisition of new clients and the development
of new commercial vehicles is important in protecting the
Group from fluctuations in market conditions. This risk is
more likely in the current Covid-19 pandemic but investment
by Government in public sector spending continues, and the
ability for new business acquisition has been enhanced with
a greater focus in this area in-line with strategy.
Brexit
The political and economic uncertainty generated by
Brexit still has the potential to negatively affect the Group’s
marketplace due to an impact on Government spending
plans and the cancellation or delay of IT projects. The
strong relationships the Group enjoys with a large range of
public sector clients within the UK mitigated this risk during
the year. During and following the Brexit transition, the
Group continued to build strong trading partnerships with
EU based companies. Due to the current lack of restrictions
of trading digital services within the EU, the Directors do
not foresee this changing in the future.
Revenue visibility
The pipeline of contracted orders for time and materials
consultancy work can be relatively short and this reduces
visibility on long-term revenue generation. The Board
carefully reviews forecasts to assess the level of risk
arising from business that is forecast to be won.
Availability of staff
The ability to recruit and retain the best quality staff, and obtain
access to appropriately skilled resources are key to ensuring
the ability to deliver profitable growth and deliver IT services to
our clients, in what continues to be a rapidly competitive market
for talent. The Group continues to recruit quality individuals,
and ensures a resilient network of associate resources is
scaled appropriately to meet the demands of the business. To
mitigate this risk, the Group reviews remuneration and benefits
on an annual basis and adjusts these accordingly within market
rates. In addition, the Group operates a Company-wide staff
development programme to ensure continuous personal growth
and consistent staff engagement. The on-boarding of new
consultants is managed by a highly experienced and dedicated
team of resourcing professionals, and this provides quality
assurance processes to accelerate hiring and reduce attrition.
Competition
The Group operates in a highly competitive environment.
The markets in which the Group operates are continually
monitored to respond effectively to emerging opportunities
and threats. The Group ensures a high quality of service to
long-tenured clients, which includes continuous review of
delivery against project plan and obtaining client feedback.
This promotes longevity of client relationships and to a high
degree mitigates the risk of competition.
There are or may be other risks and uncertainties faced
by the Group that the Directors currently deem immaterial,
or of which they are unaware, that may have a material
adverse impact on the Group.
The risk appetite of the Group is considered in light of the
principal risks and their impact on the ability to meet its
strategic objectives. The Board regularly reviews the risk
appetite which is set to balance opportunities for business
development and growth in areas of potentially higher risk,
whilst maintaining reputation, regulatory compliance, and
high levels of customer satisfaction.
Section 172 statement
Section 172 of the Companies Act 2006 requires Directors
to take into consideration the interests of key stakeholders
in the Group in their decision making. Engagement with the
Group’s stakeholders is essential to successfully managing
the business and the effectiveness of this engagement helps
to understand the impact of key decisions on stakeholders.
The Board has identified the key stakeholders as
shareholders, clients, partners, employees and suppliers.
•
Shareholders: Shareholders play a significant part
in deciding the direction of the business. Dialogue
is maintained with shareholders and their advisors
and issues of significance are communicated to
shareholders as necessary. In addition, a full shareholder
briefing is presented at the Group’s annual general
meeting of shareholders. The Board took the decision
Triad Group Plc Annual Report and Accounts 2021
| 7
Strategic report
not to make the payment of an interim dividend this year
due to the continued threat of the impact of Covid-19
and the potential effects upon future cash flow. This
decision was made to protect the interests of the
shareholders’ future earnings. The Board has proposed
a final dividend of 2p per share for the year ended 31
March 2021 due to the recent trading performance and
expected cash flows (2020: nil per share).
Clients: Delivering a quality service is the key to the Group’s
future success and effective and successful delivery of
services to our clients is the key focus of the Group. To
increase effectiveness, a constant review of utilisation
rates and delivery structures has been undertaken to
enhance the efficiency of the Group’s service to clients.
Key account delivery and management tools have also
been reviewed and enhanced to promote efficiencies. The
Group continues with the strategy of building permanent
consultants and where appropriate replacing contractors
with consultants on projects to improve and broaden the
skill sets and enhance delivery to clients.
Partners: Effective working relationships that enable future
growth are important to the Group. The Group continue to
cultivate strong relationships with our business partners,
with regular dialogue and updates to ensure that delivery
to our shared clients is as effective as possible. During
2021, the Group continued to explore delivery methods
with partners that enable the acquisition of new business,
including the successful partnership with Workpoint to
deliver the RES project.
Employees: Motivated and satisfied employees are
the lifeblood of our business and our people are key to
our success. The Group strives to achieve the highest
standards in its dealings with all employees. During 2021,
the Group has increased its level of communication with
employees with regular Group meetings chaired by the
Managing Director. The Group continued to provide
appropriate comprehensive induction and ongoing
training tailored to individual needs. Extensive employee
benefits are provided which are continually reviewed to
enhance the wellbeing of all employees. Remuneration
packages have been reviewed on an annual basis to
ensure retention of employees, as are flexible working
environments in light of the Covid-19 pandemic.
Suppliers: Effective engagement with suppliers enables the
Group to deliver a quality service to our clients. The Group
maintains appropriate arms-length trading relationships
with quality suppliers and is fully committed to fairness in
its dealing with them, including embracing the principle
of paying suppliers within agreed credit terms during the
course of normal business. The Group formed closer
relationships with suppliers during the Covid-19 pandemic
to ensure a continuance of a quality service.
•
•
•
•
8
| Triad Group Plc Annual Report and Accounts 2021
The Directors continue to ensure there is full regard to
the long-term interests of both the Group and its key
stakeholders including the impact of its activities on the
community, the environment and the Group’s reputation. In
doing this, the Directors continue to act fairly and in good
faith taking into account what is most likely to promote the
long-term success of the Group.
•
•
•
•
•
•
Relations with key stakeholders such as shareholders,
employees, and suppliers are maintained by regular, open
and honest communication in both verbal and written form.
The Directors are fully aware of their responsibilities to
promote the success of the Group in accordance with
section 172 of the Companies Act 2006.
The Directors continuously take into account the
interests of its principal stakeholders and how they are
engaged. This is achieved through information provided by
management and also by ongoing direct engagement with
the stakeholders themselves.
The Board has ensured an appropriate business structure
is in place to ensure open and effective engagement with
the workforce via the Executive Directors and the senior
management team.
The Board and the senior team continues to work
responsibly with all relevant stakeholders and has
appropriate anti-corruption and anti-bribery, equal
opportunities and whistleblowing procedures and policies
in place.
As required, non-executive Directors, professional advisors
and the Company Secretary provide support to the Board
to help ensure that sufficient consideration is given to
stakeholder issues.
Viability Statement
In accordance with the Listing Rules the Directors have
assessed the Company’s viability over the next five financial
years. Given the Group’s business model and commercial and
financial exposures the Directors consider that five years
is an appropriate period for the assessment. The maximum
period of visibility of commercial arrangements with clients is
currently two years, however in considering the assessment
period assumptions have been made beyond this immediate
timeframe. As part of the long-term viability assessment the
Directors have considered the principal risks.
This assessment of viability has been made with reference
to the Group’s current financial and operational positions.
Revenue projections, cash flows, availability of required
finance, commercial opportunities and threats, and the
Group’s experience in managing adverse conditions in the
past have been reviewed. The Group was founded in 1988 and
has survived several recessions.
Strategic report
Despite the potentially negative and severe effect of the
Covid-19 pandemic in early 2020, the Group was able to
successfully navigate the issues presented by the disruptions
and for the year ended 31 March 2021 significantly improved
all key ratios and profitability and built cash reserves without
the requirement for any external funding or take advantage of
Government support schemes. This success was due to the
agility of the business model, client delivery techniques and
the quality of our employees and hiring processes.
The effects of IR35 have been minimal as the Group has
continued to reduce contracting fee earners in favour of
higher margin permanent employees and the risk in this area
is not considered to be material.
As of the date of these accounts, Brexit has had no impact
upon the current client base and there have been no direct
impacts felt by the business. In fact, greater dialogue has
commenced with potential EU and European trading partners
and this is expected to continue.
Despite the recent successful trading position, risks still exist
with respect to the Covid-19 pandemic and the threat from
competition. The Directors have therefore approached the
budget and forecasting cycle for the 2022 financial year with
a conservative outlook.
The viability assessment considered the principal risks as
set out on page 8, and in particular, the risk presented to
the business of Covid-19. The Board modelled a number of
realistic scenarios based upon conservative budgets and
forecasts. This included modelling the most severe scenario
possible which assumed that the effects of the pandemic
would worsen with all current client contracts discontinued
at expiry, with no extension or replacement and with no cost
mitigation.
In all scenarios, it was found that there was sufficient
headroom in cash flow to continue operating within current
resources for the next 12 months, and without the requirement
to utilise the available financing facility or obtain further
external funding. The Group was therefore found to have
sufficient financial strength to withstand further disruption due
to the pandemic.
There is less visibility over the medium term outlook and the
wider economic impact of Covid-19, but the Board believes
that the Group remains well placed to navigate effectively
a prolonged period of uncertainty and to mitigate the risks
presented by it.
Based upon the results of this analysis, the Board has
a reasonable expectation that the Group will be able to
continue in operation and be able to meet its liabilities over
the next 5-year viability period. In reaching this assessment,
the Board has taken into account future trading, continued
negative effects of Covid-19, access to external funding and
cash flow expectations.
Performance assessment, financial review
and outlook
Financial and non-financial key performance indicators
(KPIs) used by the Board to monitor progress are revenue,
profit from operations, EBITDA, gross margin and
headcount. Financial KPIs are discussed in more detail in
the Financial review below. The outlook for the Group is
discussed in the Chairman’s statement on page 2.
The KPIs are as follows;
Revenue
£17,815,000
£19,354,000
2021
2020
Profit/(Loss) from
operations
Earnings before interest,
tax, depreciation and
amortisation (EBITDA)¹
£686,000
£(568,000)
£944,000
£(299,000)
Gross margin
Average headcount
21.4%
68
14.7%
62
1 EBITDA – Profit from operations of £686,000 adding back the
depreciation and amortisation charge in the year of £258,000
Corporate social responsibility
Our employees
The Group is committed to equal opportunities and
operates employment policies which are designed to
attract, retain and motivate high quality staff, regardless
of gender, age, race, religion or disability. The Group has a
policy of supporting staff in long-term career development.
Culture and engagement
The Group recognises the importance of having effective
communication and consultation with, and of providing
leadership to, all its employees. The Group promotes the
involvement of its employees in understanding the aims
and performance of the business. An assessment of
culture, engagement and future contribution made to the
business by employees is made at each Board meeting
and is considered a key aspect of the meetings. The Board
has been satisfied with policies and practices and they
are aligned with the Group’s purpose and strategy and no
corrective action is required.
The Group strives to recruit and retain high quality employees
at the cutting edge of technology. A key engagement factor
is the continuous professional development of all staff and
the Group is committed to providing increased training and
Triad Group Plc Annual Report and Accounts 2021
| 9
Strategic report
development opportunities, to enhance both the expertise
and engagement of our workforce, and improving the quality
of our services to our clients.
Diversity and inclusion
Diversity and inclusion is a key component of working life
in the Group. Employees are encouraged to take an active
role in decision making and driving the business forward,
including several platforms within the business to share
good practice, successes and potential improvements. The
appointment of Charlotte Rigg as Director in 2020 increased
the female proportion within the senior management to 22%
which is representative of the Group as a whole. We continue
to include diversity within our recruitment policies and make
improvements as appropriate.
The following table shows the average number of persons
employed during the year, by gender, who were Directors,
senior managers or employees of the Company.
Directors
Senior managers
Employees
Total
Male
Female
Total
6
1
46
53
1
1
13
15
7
2
59
68
Environment and greenhouse gas reporting
The Group is committed to ensuring that the actual and
potential environmental impact of its activities is understood
and managed effectively. The Group has used both mileage
reports and meter readings to prepare the data.
The annual quantity of Greenhouse Gas (GHG) emissions for
the period 1 April 2020 to 31 March 2021 in tonnes of carbon
dioxide equivalents (tCO2e) for the Group is shown in the
table below:
Emissions
Emission source:
Combustion of fuel
Electricity and heat
purchased for own use
Total
tCO₂e per £1m revenue
FTE
Intensity ratio (tCO₂e per
FTE)
2021
tCO2e¹
2020
tCO2e¹
–
29
29
1.6
68
0.4
17
55
72
3.7
62
1.2
10
| Triad Group Plc Annual Report and Accounts 2021
1 The calculation of tCO2e for each source has been prepared
in accordance with DEFRA guidelines for GHG reporting.
The annual energy consumed as a result of the purchase of
electricity and heat for the period 1 April 2020 to 31 March
2021 in kWh is shown in the table below:
2021
Energy consumed (kWh)
122,763
kWh per £1m revenue
FTE
Intensity ratio (kWh per FTE)
6,897
68
1,805
2020
213,357
10,998
62
3,441
The emissions are generated solely by activities in the UK.
Emissions generated by electricity consumption is 99%
(2020: 76%).
Whilst the Group has not set any specific targets in relation
for emissions due to the relatively small size of the impact,
the Group monitors the emissions on an annual basis. The
impact of the Covid-19 pandemic and the change to remote
working has dramatically reduced energy consumption and
emissions. With the expectations of further remote and
flexible working patterns, these metrics are expected to be
low in future years. The Directors believe that the Group’s
impact to the environment is negligible given the low
numbers of employees.
The Group has not been subject to any environmental fines
during the year ended 31 March 2021 (2020: nil).
Social, community and human rights issues
Triad takes its responsibilities to the community and society
as a whole very seriously. With people at the core of our
values, in October 2020 Triad is proud to have achieved its
first Disability Confident badge – Disability Confident 1st level
(“Committed”). In 2022 we plan to work up to the highest
level (level 3), and we are using this to guide and improve our
practices, particularly with regard to equality of opportunity
for disabled staff and through our recruitment processes.
We have been looking for a way to best make an impact
on the employment gaps that exist for BAME, female and
disabled people working in UK technology and in March 2021
we also became members of Tech Talent Charter. Through
this we have publicly declared our commitment to workplace
equality, have access to a community of best practice and
share data on diversity within our own Group. We believe we
are working together to make a real difference to inclusion
and diversity across the technology sector.
Strategic report
The Group actively supports charities. Managing Director,
Adrian Leer is a board member of Action for Children and
our staff participate in regular fund-raising activities for the
charity, promoted and supported by Triad.
There are no human rights issues that impact upon operations.
Financial review
Group performance
Group revenue has decreased to £17.8m (2020: £19.4m).
This is predominantly due to the reduction in private sector
low margin contractor led assignments, offset with an
increase in higher gross margin consulting business. This is
in-line with the continued strategy of servicing consultancy
assignments with permanent fee earning consultants, and
has resulted in an increase in gross profit to £3.8m (2020:
£2.9m) and an increase in gross margin as a percentage of
revenue to 21.4% (2020: 14.7%). This strategy continues into
the 2022 financial year and will provide a sound basis for
future profitable growth.
The Group reports a profit from operations before taxation of
£0.6m (2020: loss £0.6m). The positive variance in profitability
before tax of £1.2m was due to the increase in gross profit
(£0.9m) and the reduction in overheads (£0.3m). The Group
reports a profit after tax of £0.7m (2020: loss £0.8m).
The balance sheet remains strong with no external
borrowings, with the exception of the lease liabilities arising
due to the application of IFRS 16, and the Group enjoys
strong reserves of cash at £4.9m (2020: £3.8m) and no bad
debts (2020: nil).
Overheads
Administrative expenses for the year are £3.1m (2020: £3.4m).
Due to the financial risks derived from both the Covid-19
pandemic and Brexit (see page 6), the Group reduced expense
budgets across all cost lines without damaging the ability to
grow higher margin business. As such, the Group was able to
significantly grow profitability and now manages a sustainable
cost base to support future profit growth.
Staff costs
Total staff costs have increased to £5.7m (2020: £5.2m) (note
7). The total average headcount for the year has increased to
68 (2020: 62) and due to the strategy of building permanent
fee-earning consultants during the year, the number of
consultants at the year-end has increased by a net 21 to 58
(2020: 37). Consultant numbers continue to grow into the new
financial year and is a key component of the Group’s strategy
to grow both margin and profitability. Non-consultant staff
numbers at the close of the year have remained static as the
ratio of fee earners improves to 5:1 (2020: average 4:1).
Cash
Cash and cash equivalents at 31 March 2021 increased to
£4.9m (2020: £3.8m). There was a net cash inflow from
operating activities of £1.3m (2020: £0.06m) which reflects the
return to profitability and the improvements in working capital.
During the year, the Group did not take advantage of the
Government deferral schemes. Capital expenditure in the year
was managed very carefully and fixed asset additions related
mainly to the purchase of technology for new permanent
members of staff, which supported the growth in gross profit.
The net cash outflow from financing activities was £0.3m
(2020: outflow of £0.8m) and the net cash inflow from investing
activities was £0.1m (2020: outflow £0.02m). Due to the need
to augment cash reserves due to the pandemic, no dividends
were paid in the year (2020: £0.5m). However, with a return to
profitability and the strong expectation of future positive cash
flows, the Board are proposing a final dividend of 2p per share
(2020: nil per share), see page 48.
Non-current assets
Non-current assets excluding taxation were reduced by
£0.36m (2020: increase £1.0m) which predominantly related
to the net reduction in the right of use asset of £0.1m (2020:
increase £0.6m) and the finance lease receivable of £0.2m
(2020: £0.3m). A further reduction of £0.05m related to
purchased assets (2020: increase £0.1m).
Taxation
The Group adopts a low risk approach to its tax affairs. The
Group does not employ any complex tax structures or engage
in any aggressive tax planning or tax avoidance schemes. The
deferred tax asset increased to £0.07m (2020: £0.03m) in the
year, mainly due to the expectation that tax losses brought
forward will be offset against future profits (see note 8).
Net assets
The net asset position of the Group at 31 March 2021 was
£5.3m (2020: £4.6m). The movements during the year are
detailed on page 38.
Share options
A total of 48,600 options were exercised by Directors and staff
during the year (2020: 11,000). No options were granted during
the year (2020: nil). An expense of £37,000 (2020: £28,000)
has been recognised relating to options granted in March 2018.
By order of the Board
James McDonald
Finance Director
14 June 2021
Triad Group Plc Annual Report and Accounts 2021
|
11
12
| Triad Group Plc Annual Report and Accounts 2021
Directors’ report
The Directors present their Annual report on the activities
of the Group, together with the financial statements for the
year ended 31 March 2021. The Board confirms that these,
taken as a whole, are fair, balanced and understandable,
and that they provide the information necessary for
shareholders to assess the Group’s and Company’s position
and performance, business model and strategy, and that
the narrative sections of the report are consistent with the
financial statements and accurately reflect the Group’s
performance and financial position.
The Strategic report provides information relating to the
Group’s activities, its business and strategy and the principal
risks and uncertainties faced by the business, including
analysis using financial and other KPIs where necessary.
These sections, together with the Directors’ remuneration
and Corporate Governance reports, provide an overview of
the Group, including environmental and employee matters
and give an indication of future developments in the Group’s
business, so providing a balanced assessment of the Group’s
position and prospects, in accordance with the latest narrative
reporting requirements. The Group’s subsidiary undertakings
are disclosed in the notes to the financial statements.
Corporate Governance disclosures required within the
Directors’ report have been included within our Corporate
Governance report beginning on page 16 and form part of
this report.
Share capital and substantial
shareholdings
Share capital
As at 31 March 2021, the Company’s issued share capital
comprised a single class of shares referred to as ordinary
shares. Details of the ordinary share capital can be found in
note 19 to these financial statements.
Voting rights
The Group’s articles provide that on a show of hands at a
general meeting of the Company every member who (being
an individual) is present in person and entitled to vote shall
have one vote and on a poll, every member who is present
in person or by proxy shall have one vote for every share
held. The notice of the Annual General Meeting specifies
deadlines for exercising voting rights and appointing a
proxy or proxies to vote in relation to resolutions to be
passed at the Annual General Meeting.
Transfer of shares
There are no restrictions on the transfer of ordinary shares
in the Company other than as contained in the Articles:
•
The Board may, in its absolute discretion, and without
giving any reason for its decision, refuse to register any
transfer of a share which is not fully paid up (but not so
as to prevent dealing in listed shares from taking place)
and on which the Company has a lien. The Board may
also refuse to register any transfer unless it is in respect
of only one class of shares, in favour of no more than
four transferees, lodged at the Registered office, or such
other place as the Board may decide, for registration,
accompanied by a certificate for the shares to be
transferred (except where the shares are registered in
the name of a market nominee and no certificate has
been issued for them) and such other evidence as the
Board may reasonably require to prove the title of the
intending transferor or his right to transfer the shares.
Certain restrictions may from time to time be imposed by
laws and regulations, for example:
•
•
Insider trading laws; and
Whereby certain employees of the Group require the
approval of the Company to deal in the Company’s
ordinary shares.
Appointment and replacement of Directors
The Board may appoint Directors. Any Directors so appointed
shall retire from office at the next Annual General Meeting of
the Company, but shall then be eligible for re-appointment.
The current Articles require that at the Annual General
Meeting one third of the Directors shall retire from office but
shall be eligible for re-appointment. The Directors to retire
by rotation at each Annual General Meeting shall include any
Director who wishes to retire and not offer themselves for re-
election and otherwise shall be the Directors who, at the date
of the meeting, have been longest in office since their last
appointment or re-appointment.
A Director may be removed from office by the service of a
notice to that effect signed by at least three quarters of all the
other Directors.
Amendment of the Company’s Articles of Association
The Company’s Articles may only be amended by a special
resolution passed at a general meeting of shareholders.
Substantial shareholdings
As at 31 March 2021, since the date of the last annual report
in June 2020, the Company had received the following
notifications relating to interests in the Company’s issued share
capital, as required under the Disclosure and Transparency
Rules (DTR 5) when a notifiable threshold is crossed:
Percentage of issued share capital
T Charlton
5.51%
As at 14 June 2021, no notifications have been received since
the year-end.
Triad Group Plc Annual Report and Accounts 2021
|
13
Directors’ report
Dividends
There was no interim dividend paid during the year (2020:
1p). The Directors propose a final dividend of 2p per share
(2020: nil per share).
Financial instruments
The Board reviews and agrees policies for managing
financial risk. These policies, together with an analysis of the
Group’s exposure to financial risks are summarised in note 3
of these financial statements.
Research and development activity
Research and development activities are undertaken with
the prospect of gaining new technical knowledge and
understanding, and developing new software. During the
year, dedicated small teams worked on artificial intelligence
capabilities within software applications, project management
tool capabilities, and developed bespoke employee
development portals to enhance the investment in our people.
Directors’ interests in contracts
Directors’ interests in contracts are shown in note 21 to the
accounts.
Directors’ insurance and indemnities
The Company maintains Directors’ and Officers’ liability
insurance which gives appropriate cover for any legal action
brought against its Directors and Officers. The Directors also
have the benefit of the indemnity provisions contained in the
Company’s Articles of Association. These provisions, which
are qualifying third-party indemnity provisions as defined
by Section 236 of the Companies Act 2006, were in force
throughout the year and are currently in force.
Disclosure of information to auditor
All of the current Directors have taken all the steps that
they ought to have taken to make themselves aware of
any information needed by the Company’s auditor for the
purposes of their audit and to establish that the auditor is
aware of that information. The Directors are not aware of any
relevant audit information of which the auditor is unaware.
Forward-looking statements
The Strategic report contains forward-looking statements.
Due to the inherent uncertainties, including both economic
and business risk factors, underlying such forward-looking
information, the actual results of operations, financial
14
| Triad Group Plc Annual Report and Accounts 2021
position and liquidity may differ materially from those
expressed or implied by these forward-looking statements.
Going concern
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. The financial
position of the Group, its cash flows, liquidity position and
borrowing facilities are described in the Strategic report.
In addition, note 3 to the financial statements includes the
Group’s objectives, policies and processes for managing its
capital, its financial risk management objectives, details of its
financial instruments and hedging activities, and its exposure
to credit risk and liquidity risk. The Group meets its day to
day working capital requirements through cash reserves and
an invoice finance facility (which is currently unutilised).
The Group operates an efficient low-cost and historically
cash generative model. The client base generally consists of
large blue-chip entities, particularly within the public sector,
enjoying long-term and productive client relationships. As
such, debt recovery has been reliable and predictable with
a low exposure to bad debts. For the year ended 31 March
2021, the Group has not utilised any external debt, lending
facilities or accessed any Government support schemes
(2020: nil). Due to the ability to operate services remotely,
the Group has remained in full operation throughout recent
lockdown periods and will continue to do so as external
factors dictate. The success of the business during the year
ended 31 March 2021 illustrates the operational flexibility of
both the Group and its current and future client base.
The going concern assessment considered a number of
realistic scenarios including the impact of the reduction in
services of key clients upon future cash flows. In addition, in
the most severe scenario possible, a reverse stress test was
modelled which included the effects of any future Covid-19
pandemic issues, with all current client contracts discontinued
at expiry with no extension or replacement and with no cost
mitigation. Even in the most extreme scenario, the Group
has enough liquidity and long-term contracts to support the
business through the going concern period. The Directors have
concluded from these assessments that the Group would have
sufficient headroom in cash balances to continue in operation.
Further information in relation to the Directors’ consideration
of the going concern position of the Group is contained in
the Viability statement on page 8.
After making enquiries, the Directors have a reasonable
expectation that the Group has adequate resources to
continue in operational existence for the foreseeable future and
at least twelve months from the date of approval of the financial
statements. Accordingly, they continue to adopt the going
concern basis in preparing the annual report and accounts.
Directors’ report
Auditor
BDO LLP have indicated their willingness to continue in
office. Accordingly, a resolution to reappoint BDO LLP as
auditors of the Company will be proposed at the next Annual
General Meeting.
Environment and greenhouse
gas reporting
Carbon dioxide emissions data is contained in the Corporate
social responsibility section of the Strategic report.
Statement of Directors’ responsibilities
The Directors are responsible for preparing the annual report
and the financial statements in accordance with international
accounting standards in conformity with the requirements of
the Companies Act 2006 and applicable law and regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the Directors
are required to prepare the Group financial statements and
have elected to prepare the Company financial statements
in accordance with the requirements of the Companies Act
2006. 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 for the Group and Company
for that period. The Directors are also required to prepare
financial statements in accordance with international financial
reporting standards adopted pursuant to Regulation (EC) No
1606/2002 as it applies in the European Union.
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 international accounting standards in conformity
with the requirements of the Companies Act 2006,
subject to any material departures disclosed and
explained in the financial statements;
state whether they have been prepared in accordance
with international financial reporting standards adopted
pursuant to Regulation (EC) No 1606/2002 as it applies
in the European Union, subject to any material departures
disclosed and explained in the financial statements;
•
•
•
•
•
•
prepare a Directors’ report, Strategic report and
Directors’ remuneration report which comply with the
requirements of the Companies Act 2006.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the Company’s transactions and disclose with reasonable
accuracy at any time the financial position of the Company
and enable them to ensure that the financial statements
comply with the Companies Act 2006 and, as regards the
Group financial statements, Article 4 of the IAS Regulation.
They are also responsible for safeguarding the assets of
the Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The Directors are responsible for ensuring that the annual
report and accounts, taken as a whole, are fair, balanced,
and understandable and provide the information necessary
for shareholders to assess the Group’s position and
performance, business model and strategy.
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.
Directors’ responsibilities pursuant to DTR4
The Directors confirm to the best of their knowledge:
•
•
The financial statements have been prepared in
accordance with the applicable set of accounting
standards and Article 4 of the IAS Regulation and give
a true and fair view of the assets, liabilities, financial
position and profit and loss of the group.
The annual report includes a fair review of the
development and performance of the business and
the financial position of the Group and the Parent
Company, together with the description of the principal
risks and uncertainties that they face.
By order of the Board
prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the
company will continue in business;
James McDonald
Company Secretary
14 June 2021
Triad Group Plc Annual Report and Accounts 2021
|
15
Corporate governance report
The Board has considered the principles and provisions of the
UK Corporate Governance Code 2018 (“the Code”) applicable
for this financial period. The changes made in the revised Code
attempt to improve corporate governance processes and
encourage companies to demonstrate how good governance
contributes to the achievement of long-term success for
stakeholders. The Group keep governance matters under
constant review. Despite the changes in the Code requiring a
review of processes, there has not been a requirement to make
fundamental changes to strategy or working practices.
The following statement sets out the Group’s application of the
principles of the Code and the extent of compliance with the
Code’s provisions, made in accordance with the requirements
of the Listing Rules.
The Board
The Board is responsible for the long-term and sustainable
success of the business, and considers all opportunities and
risks as set out in the principal risks and uncertainties on
page 6. Further, the Board considers how good governance
can assist in promoting the delivery of the strategy, by
reference to strong stakeholder engagement. Details of how
the Board drive this engagement can be found within the
S172 statement on page 7.
The Directors who held office during the financial year were:
Executive Directors
John Rigg, Chairman
Adrian Leer, Managing Director
James McDonald, Finance Director (appointed 16.06.20)
Tim Eckes, Client Services Director
Independent non-executive Directors
Alistair Fulton, senior independent non-executive Director
Chris Duckworth
Charlotte Rigg
John Rigg is Chairman. He is a Chartered Accountant. He was
a founder of Marcol Group Plc and was its Managing Director
from 1983 until 1988. Marcol was floated on the Unlisted
Securities Market in 1987. He was Chairman of Vega Group
plc from 1989 until 1996, holding the post of Chief Executive
for much of this period. Vega floated on the main market in
1992. He was a founder shareholder of Triad and served as
the Chairman of the Company from 1988 up to just before its
flotation in 1996, when he resigned to develop new business
16
| Triad Group Plc Annual Report and Accounts 2021
interests overseas. He was appointed as non-executive
Chairman in June 1999: in May 2004 he became part-time
executive Chairman. Between 4 February 2005 and 5
September 2007 John was acting Group Chief Executive.
Adrian Leer is Managing Director. He was appointed to the
Board on 3 March 2015. He initially joined Triad in 2009 in
a consultative capacity, providing advice to the business
regarding its fledgling geospatial product, Zubed, and helping
to secure significant wins with major clients. In 2010, he
became General Manager of Zubed Geospatial. Adrian became
Commercial Director of Triad Consulting & Solutions in 2012.
Tim Eckes is Client Services Director. He was appointed
to the Board on 1 January 2020. Tim Eckes joined Triad in
1991 as a graduate software engineer before moving into
a number of technical and commercial roles. He has multi-
sector experience, having been involved in engagements
across finance, telecoms, travel and central government.
In 5 years preceding his appointment to the Board as
Managing Consultant, he played a significant role in growing
the business through the development of long lasting and
profitable relationships with key clients.
Alistair Fulton is a non-executive Director. He is a Chartered
Engineer and member of the British Computer Society.
He was the founding Managing Director of Triad. He
continued in this role until February 1997 when he became
non-executive Chairman, a position he retained until June
1999, when he took up his present position. He was a board
member of CSSA for 15 years, President in 2000/2001, and
is currently Senior Warden of the Worshipful Company of
Information Technologists, the 100th Livery Company of the
City of London.
Chris Duckworth was appointed on 1 July 2017 as a non-
executive Director. He has held numerous positions within
public and private companies as Finance Director, Managing
Director, non-executive Director and Chairman. He was a
founding shareholder and from 1989 to 1994 was Finance
Director of Triad where he remained as a non-executive
Director until 1999. From 1989 to 1994 he was Finance
Director of Vega Group PLC after which he served as a non-
executive Director until 1997. He was a founding shareholder
and Chairman of Telecity PLC in May 1998 and subsequently
acted as a non-executive Director until August 2001.
Charlotte Rigg is a non-executive Director and was
appointed to the Board on 1 January 2020. Charlotte Rigg’s
experience is both extensive and diverse. Over the last 25
years she has built an internationally recognised stud farm
and runs a sizeable upland grazing farm in Cumbria where
the stud is based. In addition, Charlotte runs a successful
and expanding investment property portfolio which has been
established for over 20 years.
Corporate governance report
James McDonald is Finance Director and was appointed
to the Board on 16 June 2020. He joined the Company in
February 2020 and, in March 2020, assumed the position
of Company Secretary and acting Finance Director. He is a
Chartered Certified Accountant and has previously held a
senior finance position at Foxtons Group plc, prior to which
he was Group Finance Director and Company Secretary at
Brook Street Bureau Plc. He qualified with EY in London.
The Board exercises full and effective control of the Group
and has a formal schedule of matters specifically reserved to
it for decision making, including responsibility for formulating,
reviewing and approving Group strategy, budgets and major
items of capital expenditure.
Regularly the Board will consider and discuss matters that
include, but are not limited to:
•
•
•
•
•
•
•
Strategy;
Shareholder value;
Financial performance and forecasts;
Alignment of culture to Group values;
Employee engagement;
Human resources; and
City and compliance matters.
The Executive Chairman, John Rigg, is responsible for the
leadership and efficient operation of the Board. This entails
ensuring that Board meetings are held in an open manner
and allow sufficient time for agenda points to be discussed. It
also entails the regular appraisal of each Director, providing
feedback and reviewing any training or development needs.
Employee engagement is taken very seriously by the Board,
and the need to engage with the workforce is even more
important since the onset of the pandemic. Bi-weekly Group-
wide communication meetings chaired by the Managing
Director take place where there is a forum available for all
staff to participate and contribute directly with management.
Senior management meet daily to discuss the business
and create appropriate communications that predominantly
seek to enhance the well-being of staff but also look to align
Group values to strategy. Further, on-line platforms exist
that enable constructive discussions concerning operational
delivery and best practice. Given the size of the Group, it
is not appropriate to develop any sub-committees for this
purpose and direct Group forums encourage all staff to
participate without dilution of message.
In a competitive marketplace for talent, the Board ensure
further engagement via regular pay reviews and formal staff
development processes, which enable training and career
aspirations to be discussed along with the facilitation of
individual career paths. The Board are firmly of the view that
the culture centred around the recruitment and retention of
quality staff, their wellbeing, development and future career
and remuneration aspirations will drive the strategic aims of
the business and drive stakeholder value in the long-term.
The Board meets regularly with senior management to
discuss operational matters. The non-executive Directors
must satisfy themselves on the integrity of financial
information and that financial controls and systems of
risk management are robust. Following presentations by
senior management and a disciplined process of review
and challenge by the Board, clear decisions on the policy
or strategy are adopted that preserve Group values and
are sustainable over the long-term. The responsibility for
implementing Board decisions is delegated to management
on a structured basis and monitored at subsequent meetings.
During the period under review, and to date, the Executive
Chairman has not held any significant commitments outside
the Group.
Alistair Fulton is the nominated senior independent non-
executive Director. Chris Duckworth and Charlotte Rigg are
non-executive Directors. All have long-standing experience
in both executive and non-executive roles and are free from
any business or other relationship that could materially
interfere with the exercise of their independent judgement.
The Board benefits from their experience and independence,
when they bring their judgement to Board decisions. The
Board considers that all continue to remain independent for
the reasons stated above.
The Group has a procedure for Directors to take
independent professional advice in connection with the
affairs of the Group and the discharge of their duties as
Directors.
The Board has an Audit Committee, comprised of the
Executive Chairman John Rigg, and the independent non-
executive Directors, Alistair Fulton and Chris Duckworth. The
Committee is chaired by Alistair Fulton.
The Board has a Remuneration Committee, comprised of
the Executive Chairman John Rigg, and the independent
non-executive Directors, Alistair Fulton, and (with effect from
16 June 2020) Charlotte Rigg. No third-party advisors have
a position on the committee or have provided services to
the Committee during the year. The Committee is chaired by
Alistair Fulton.
Triad Group Plc Annual Report and Accounts 2021
|
17
Corporate governance report
The following table shows the attendance of Directors at
scheduled meetings of the Board and Audit and Remuneration
Committees during the year ended 31 March 2021 and shows
that the Board are able to allocate sufficient time to the
company to discharge their responsibilities effectively.
Board
Audit
Committee
Remuneration
Committee
Number of meetings held
11
Number of meetings attended
Executive Directors:
John Rigg (Chairman)
Adrian Leer
Tim Eckes
James McDonald
(appointed 16.06.20)
Non-Executive Directors:
Alistair Fulton
Chris Duckworth
Charlotte Rigg
11
11
11
8
11
11
11
1
1
–
–
–
1
1
–
1
1
–
–
–
1
–
1
Prior to his appointment to the Board on 16 June 2020,
James McDonald attended an additional 3 Board meetings
and 1 Audit Committee meeting in his capacity as Company
Secretary and acting Finance Director.
Audit Committee
The members of the Audit Committee are shown above.
The Board believe that John Rigg, a Chartered Accountant
with broad experience of the IT industry, Alistair Fulton,
who has been a Director of companies in the IT sector for
over 30 years and Chris Duckworth, with many years of
experience in senior finance positions in listed companies,
have recent and relevant financial experience, as required
by the Code.
The Audit Committee is responsible for reviewing the
Group’s annual and interim financial statements and
other announcements. It is also responsible for reviewing
the Group’s internal financial controls and its internal
control and risk management systems. It considers the
appointment and fees of the external auditor and discusses
the audit scope and findings arising from audits. The
Committee is also responsible for assessing the Group’s
need for an internal audit function.
18
| Triad Group Plc Annual Report and Accounts 2021
Consideration of significant issues in relation to the
financial statements
The Audit Committee have considered the following
significant issues in relation to the preparation of these
financial statements;
Revenue recognition: The Committee has considered
revenue recognised in projects during, and active at the
end of the financial year to ensure revenue has been
recognised correctly.
IFRS 16 ‘Leases’: The Committee have considered
the accounting treatment with respect to the critical
accounting estimates.
Dilapidations provisions: The Committee have considered
the accounting treatment with respect to the critical
accounting estimates.
Going concern: The Committee has reviewed budgets
and cash flow projections against borrowing facilities
available to the Group to ensure the going concern basis of
preparation of the results remains appropriate.
Meetings with auditor and senior finance team
Members of the Audit Committee met with the senior
finance team in advance of their meeting with the auditor,
prior to commencement of the year-end audit to discuss;
• Audit scope, strategy and objectives
• Key audit and accounting matters
• Independence and audit fee
A meeting was held prior to the completion of the audit
with the senior finance team and the auditor to assess the
effectiveness of the audit and discuss audit findings.
Effectiveness of external audit process
The Committee conducts an annual review of the
effectiveness of the annual report process. Inputs into the
review include feedback from the finance team, planning
and scope of the audit process and identification of risk,
the execution of the audit, communication by the auditor
with the Committee, how the audit adds value and a review
of auditor independence and objectivity. Feedback is
provided to the external auditor and management by the
Committee, with any actions reviewed by the Committee.
Auditor independence and objectivity
The Committee has procedures in place to ensure that
independence and objectivity is not impaired. These include
restrictions on the types of services which the external
auditor can provide, in line with the FRC Ethical Standards
on Auditing. The external auditor has safeguards in place
to ensure that objectivity and independence is maintained
and the Committee regularly reviews independence taking
Corporate governance report
into consideration relevant UK professional and regulatory
requirements. The external auditor is required to rotate the
audit partner responsible for the Group audit every five
years.
The Board has also performed a specific assessment for the
purpose of this annual report. This assessment considers all
significant aspects of internal control and risk management
arising during the period covered by the report.
Non-audit fees
During the year the Group did not engage its auditor for
any non-audit work.
The Committee is responsible for reviewing any non-audit
work to ensure it is permissible under EU audit regulations
and that fees charged are justified, thus ensuring auditor
independence is preserved.
Appointment of external auditor
BDO LLP was reappointed external auditor in 2017
following a tendering process.
BDO LLP has confirmed to the Committee that they remain
independent and have maintained internal safeguards to
ensure that the objectivity of the engagement partner and
audit staff is not impaired.
Internal audit
The Audit Committee has considered the need for a
separate internal audit function this year but does not
consider it appropriate in view of the size of the Group. The
Group is certified to ISO 9001: 2015.
Internal controls and risk management
The Board has applied the internal control and risk
management provisions of the Code by establishing
a continuous process for identifying, evaluating and
managing the significant and emerging risks faced by the
Group. The Board regularly reviews the process, which
has been in place from the start of the year to the date
of approval of this report and which is in accordance with
FRC guidance on risk management, internal control and
related financial and business reporting. The Board is
responsible for the Group's system of internal control and
for reviewing its effectiveness. Such a system is designed
to manage rather than eliminate risk of failure to achieve
business objectives and can only provide reasonable and
not absolute assurance against misstatement or loss.
In compliance with the Code, the Audit Committee
regularly reviews the effectiveness of the Group's systems
of internal financial control and risk management. The
Board’s monitoring covers all controls, including financial,
operational and compliance controls and risk management.
It is based principally on reviewing reports from
management to consider whether significant weaknesses
and risks are effectively managed and, if applicable,
considering the need for more extensive monitoring.
The key elements of the internal control and risk
management systems are described below:
•
•
•
•
•
•
Clearly documented procedures contained in a
series of manuals covering Group operations and
management, which are subject to internal project audit
and external audit as well as regular Board review.
The Group’s controls include appropriate segregation
of duties which are embedded in the organisation
The Group has a formal process for planning, reporting
and reviewing financial performance against strategy,
budgets, forecasts and on a monthly, bi-annual and
annual basis.
An appropriate budgeting process where the business
prepares budgets for the coming year, which are
approved by the Board.
Close involvement in the day-to-day management of
the business by the Executive Directors.
Regular meetings between the Executive Chairman,
Executive Directors and senior managers to discuss
and monitor potential risks to the business, and to
implement mitigation plans to address them.
Remuneration Committee
The Remuneration Committee is responsible for setting
remuneration for Executive Directors and the Chairman
in accordance with the remuneration policy below. In
addition, the Committee is responsible for recommending
and monitoring the level and structure of remuneration for
senior management.
The Group’s Remuneration Committee is authorised to
take appropriate counsel to enable it to discharge its duty
to make recommendations to the Board in respect of all
aspects of the remuneration package of Directors. The
Committee also takes into account the general workforce
remuneration awards when setting Director remuneration.
The Directors’ remuneration report can be found on page 22.
Triad Group Plc Annual Report and Accounts 2021
|
19
Corporate governance report
Whistleblowing
Provisions 17/23
Staff may contact the senior independent non-executive
Director, in confidence, to raise genuine concerns of possible
improprieties in financial reporting or other matters.
Board evaluation
Provision 18
Board members are made fully aware of their duties and
responsibilities as Directors of listed companies and are
supported in understanding and applying these by established
and more experienced Directors. The Executive Chairman
continuously evaluates the ability of the Board to perform
its duties and recognises the strengths and addresses any
weaknesses of the board. In addition, training is available
for any Director at the Group’s expense should the Board
consider it appropriate in the interests of the Group.
Relations with shareholders
Substantial time and effort is spent by Board members
on meetings with and presentations to existing and
prospective investors. The views of shareholders derived
from such meetings are disseminated by the Chairman to
other Board members.
Provision 19
Provision 20
Private shareholders are invited to attend and participate at
the Annual General Meeting.
Provisions 21/23
Terms of reference
The terms of reference of the Audit and Remuneration
Committees are available on request from the Company
Secretary.
Provision 24
Statement of compliance
The Board considers that it has been compliant with the
provisions of the Code for the whole of the period, except
as detailed below:
DTR 7.2.8 ARR
Provision 9
The roles of chairman and chief executive
should not be exercised by the same individual.
John Rigg is the Executive Chairman. Adrian
Leer is Managing Director. The Board
currently has no plans to recruit a Chief
Executive Officer as it considers that the
duties are being satisfactorily covered by
members of the Executive Board and the
Group’s senior management.
20
| Triad Group Plc Annual Report and Accounts 2021
By order of the Board
James McDonald
Company Secretary
14 June 2021
There should be a nominations committee
which should lead the process for board
appointments and make recommendations to
the board. The Board considers that because
of its size, the whole Board should be involved
in Board appointments.
All Directors should be subject to annual re-
election. The Board consider that because of
its size, re-election by rotation in accordance
with the Company’s Articles of Association at
the Annual General Meeting is sufficient.
The chair should not remain in post beyond nine
years from the date of their first appointment to
the board. The Board considers that because
of its size and critically, due to the experience
of the Executive Chairman, this would not
be appropriate. The Board believe that re-
election in accordance with the Company’s
Articles of Association is sufficient.
Open advertising and/or an external search
consultancy should generally be used for the
appointment of the chair and non-executive
Directors. The Board has a strong culture
of promoting from within with relevant
experience to the Group.
The board should undertake a formal and rigorous
annual evaluation of its own performance and that
of its committees and individual Directors. There
is a process of continuous informal evaluation,
due to the small size of the Board.
The chair of the board should not be a member
of the audit committee. The Board considers
that because of its size, and the relevant
knowledge and experience of the Executive
Chairman, that this is not appropriate.
The requirement to detail performance against
a diversity policy. The Group has a diversity
policy which meets our legal requirements.
The monitoring of performance against this
policy is an area which the Board take very
seriously and continuously look to improve.
The size of the Group and the long tenure of
senior staff provide constraints to improving
ratios in the short-term.
Triad Group Plc Annual Report and Accounts 2021
| 21
Directors’ remuneration report
On the following pages we set out the remuneration report for the year ended 31 March 2021. The members of the
Remuneration Committee are shown in the Corporate Governance report on page 16.
This report has been prepared in accordance with the Companies Act 2006 and is split into two sections as follows;
1. The Directors’ remuneration policy.
2. The Annual report on remuneration. This will be subject to an advisory shareholder vote at this years’
Annual General Meeting.
As outlined by the Executive Chairman and the Managing Director in their annual statements on pages 2 and 4, given the
uncertainty of both the pandemic and Brexit, it was felt that containing operating costs and maintaining cash balances was
appropriate, and the Committee carefully reviewed Director’s remuneration. As such, no salary increases were awarded to the
Directors in the year. Outside of the normal course of business, there were also no discretionary payments. The Committee
intends to implement the Directors remuneration for the following year as agreed at the 2020 Annual General Meeting.
Directors’ remuneration policy
The remuneration policy sets out the framework within which the Company remunerates its Directors. The Company’s remuneration
report was put to a shareholder vote at the 2020 Annual General Meeting of the Company and was approved by 62.0% of
shareholders and with 38.0% against with no votes withheld. See page 13 of the Directors’ report for further details of voting rights.
The Committee acknowledges the votes against the policy and has carefully reviewed the outcome. The Committee aims to
align remuneration with Group financial performance by taking into account the difficult trading environment, and to ensure
the long-term health of the business. The performance of the Directors has been deemed by the Committee to be more than
satisfactory throughout the pandemic, with progression on key strategic objectives and a return to profitability. The Committee
therefore concludes that the remuneration is fair and appropriate but will continue to seek shareholder feedback.
The remuneration policy will be put to a shareholder vote every three years unless any changes to the policy are proposed
before then.
Policy table – Executive Directors
Element
Base salary
Benefits in kind
Relevance to short and
long-term strategic
objectives
Reflects the individual’s
skills, responsibilities and
experience.
Supports the recruitment
and retention of Executive
Directors.
Protects the well-being of
Directors and provides fair
and reasonable market
competitive benefits.
Operation
Maximum payable
Performance metrics
Reviewed annually
taking into consideration
individual and company-
wide performance and
the wider employee pay
review.
Ordinarily, salary
increases will be in
line with average
increases awarded to
other employees in the
Company.
None, although individual
performance is
considered when setting
salary levels.
None.
Benefits are set at a
level considered to
be appropriate taking
into account individual
circumstances.
Benefits in kind include
company cars or
allowances, private
medical insurance, life
cover and permanent
health insurance.
Benefits are reviewed
periodically.
Pension
Provides competitive
post-retirement benefits
to support the recruitment
and retention of Executive
Directors.
The Company pays
contributions into a
personal pension scheme
or cash alternative.
The Company matches
individual contributions up
to a maximum of 5%.
None.
22
| Triad Group Plc Annual Report and Accounts 2021
Directors’ remuneration report
Share option
scheme
Encourages share
ownership amongst
employees and aligns
their interests with the
shareholders.
The Company operates an
EMI share option scheme.
Discretionary awards are
made in accordance with
the scheme rules.
The potential value of
options held rises as the
Company’s share price
increases.
Specific performance
criteria are specified
at the time of awarding
the share options to
ensure alignment with the
interests of shareholders.
The award of share options is at the discretion of the Remuneration Committee: there is no scheme providing entitlement to
share options, and there is no long-term incentive scheme. The Group does not believe that performance related bonuses are
appropriate at the present time. The Executive Directors’ existing interests in shares and share options are expected to align
their interests with those of shareholders.
Policy table – non-executive Directors
Element
Fees
Relevance to short and
long-term strategic
objectives
Competitive fees to
attract experienced
Directors.
Operation
Maximum payable
Performance metrics
Reviewed annually.
Not applicable.
In general, the level of fee
increase for the non-
executive Directors will be
set taking account of any
change in responsibility.
The remuneration of the non-executive Directors is agreed by the Board. However, no Director is involved in deciding their
own remuneration.
Approach to recruitment remuneration
The Group’s remuneration policy is to provide remuneration packages which secure and retain management of the highest
quality. Therefore, when determining the remuneration packages of new executive Directors, the Remuneration Committee
will structure a package in accordance with the general policy for executive Directors as shown above. In doing so the
Committee will consider a number of factors including:
•
•
•
•
the salaries and benefits available to executive Directors of comparable companies;
the need to ensure executive Directors’ commitment to the continued success of the Group;
the experience of each Executive Director; and
the nature and complexity of the work of each Executive Director.
Directors’ service contracts and policy
The details of the Directors’ contracts are summarised as follows:
Date of contract
Notice period
J C Rigg
A M Fulton
A Leer
C J Duckworth
T J Eckes
C M Rigg
J McDonald
01/07/1999
19/02/1997
03/03/2015
01/07/2017
01/01/2020
01/01/2020
16/06/2020
1 month
1 month
6 months
1 month
6 months
1 month
6 months
All contracts are for an indefinite period. No contract has any provision for the payment of compensation upon the
termination of that contract.
Triad Group Plc Annual Report and Accounts 2021
| 23
Directors’ remuneration report
Illustrations of application of remuneration policy
As there are currently no performance related or variable elements of Executive Director remuneration it is not appropriate
to prepare illustrations required under the legislation.
Policy on payment for loss of office
It is the Group’s policy in relation to Directors’ contracts that:
•
•
•
executive Directors should have contracts with an indefinite term providing for a maximum of six months’ notice by either party.
non-executive Directors should have terms of engagement for an indefinite term providing for one month notice by either party.
there is no provision for termination payments to Directors.
Consideration of employment conditions elsewhere in the Group
In setting the executive Directors’ remuneration, the Committee takes into account the pay and employment conditions
applicable across the Group in the reported period. No consultation has been held with employees in respect of Executive
Directors’ remuneration.
Consideration of shareholders views
The policy is unchanged from the previous year as endorsed by the majority vote in favour of the approval of the Directors’
remuneration report at the Annual General Meeting in September 2020.
Annual report on remuneration (audited)
Directors' remuneration – single total figure of remuneration
The remuneration of each of the Directors for the period they served as a Director are set out below:
Director
Executive
J C Rigg
A Leer
T J Eckes¹
J McDonald (appointed
16.06.20)¹
Non-executive
A M Fulton
C J Duckworth
C Rigg
2021
Basic salary
and fees
Benefits in kind
Pension
£’000
£’000
£’000
Other
£’000
Total
£’000
60
161
131
105
40
35
35
–
15
3
–
–
–
–
–
25
17
11
–
–
–
–
–
5
–
–
–
–
60
201
156
116
40
35
35
24
| Triad Group Plc Annual Report and Accounts 2021
Directors’ remuneration report
Director
Executive
J C Rigg
N E Burrows (left 19.03.20)²
A Leer
T J Eckes (appointed 01.01.20)
Non-executive
A M Fulton²
S M Sanderson (left 04.09.19)
C J Duckworth
C Rigg (appointed 01.01.20)
2020
Basic salary
and fees
Benefits in kind
Pension
£’000
£’000
£’000
Other
£’000
Total
£’000
60
120
167
28
40
15
35
–
–
13
15
1
–
–
–
–
–
26
19
4
–
–
–
–
–
43
–
–
15
–
–
–
60
202
201
33
55
15
35
–
¹ Tim Eckes basic salary and car allowance was agreed on 16 June 2020 at £130,000 p.a. and £10,200 respectively,
effective 1 January. A total amount of £4,925 was paid in back-pay relating to the year ending 31 March 2020. James
McDonald was appointed Finance Director 16 June 2020 on a salary of £130,000 p.a. and car allowance of £10,200 p.a.
effective 1 July 2020. His salary, pension and benefits are pro-rated to reflect the period 16 June 2020 to 31 March 2021.
² This represents for Nick Burrows a payment in lieu of share options forfeited of £42,500. For A M Fulton the total of
£15,000 represents back-pay.
Benefits in kind include the provision of company car and medical insurance.
Pension includes a 5% employer contribution together with contributions made under an employee salary sacrifice
scheme.
Other than vesting conditions in relation to outstanding share options (see note 20), no performance measures or targets
were in place for either the year ended 31 March 2021 or any prior financial year, upon which any variable pay elements
could become payable during the year.
Three Directors are members of a money purchase scheme into which the Group contributed during the year.
Payments to past Directors
There were no payments to past Directors during the year.
Payment for loss of office
Former Finance Director and Company Secretary Nick Burrows was paid a one-time discretionary settlement fee for loss of
office of £30,000 in the year ended 31 March 2020. The Board believed this was necessary to ensure a smooth hand-over
with his successor.
Directors’ interests in shares
The Directors who held office at the end of the financial year had the following beneficial interests in the ordinary shares of
the Company. No change has occurred between the year end and the date of this report.
Triad Group Plc Annual Report and Accounts 2021
| 25
Directors’ remuneration report
A M Fulton
J C Rigg
A Leer
C J Duckworth
T J Eckes
C M Rigg
J McDonald (appointed 16.06.20)
Directors’ share options
The interests of executive Directors in share options were as follows:
1 April 2020
265,200
4,509,400
155,379
13,379
60,374
100,000
–
31 March 2021
337,040
4,509,400
155,379
22,026
60,374
100,000
–
At beginning
of year
Forfeited
during year
Exercised
during year
At end
of year
Exercise
price
Exercise period
A Leer:
granted 09.03.18
150,000
T J Eckes:
granted 09.03.18
60,000
210,000
–
–
–
–
–
–
150,000
53.5p
09.03.21 to 09.03.28
60,000
53.5p
09.03.21 to 09.03.28
210,000
As the performance conditions were met all 210,000 above were exercisable on 1 April 2021 and subject to relevant close
period (2020: nil).
Share options are exercisable provided that the relevant performance requirement has been satisfied.
For options granted on 9 March 2018: The vesting date was set at 31 March 2021 and the exercise period ends on 9 March
2028, and 100% of the shares granted under an Option will vest if the Company’s share price at 31 March 2021 has increased
by 30% or more from the share price as at the date of grant. 50% of shares granted under an Option will vest if the Company’s
share price at 31 March 2021 has increased by 15% from the share price as at the date of grant. Between these upper and
lower thresholds, awards vest on a straight-line basis.
For all other options: In any financial year commencing at least one year after the date of grant, the Company shall have
achieved a positive basic earnings per share (subject to adjustment to exclude identified exceptional items), as reported in its
audited annual accounts.
The total share-based payment expense recognised in the year in respect of Directors’ share options is £13,619 (2020: £15,762).
The market price of the Company’s shares was 125p at 31 March 2021 and the range during the year was between 24p and 150p.
26
| Triad Group Plc Annual Report and Accounts 2021
Directors’ remuneration report
Annual report on remuneration (unaudited)
Performance graph
The following graph shows the Group’s performance, measured by total shareholder return, compared with the performance
of the FTSE Fledgling Index (“FTSEFI”) also measured by total shareholder return (“TSR”). The FTSEFI has been selected
for this comparison because it is an index of companies with similar current market capitalisation to Triad Group Plc.
TRD v FTSE Fledgling Index
Fledging
Triad
450
400
350
300
250
200
150
100
50
x
e
d
n
I
Mar 10
Mar 11
Mar 12
Mar 13
Mar 14
Mar 15
Mar 16
Mar 17
Mar 18
Mar 19 Mar 20 Mar 21
Chief executive remuneration
For the financial year ended 31 March 2021 the salary of the Executive Chairman was £60,000 (2020: £60,000). Employee
salaries increased, on average, by 3.7% in the year.
The remuneration paid to the Executive Chairman for the financial years 2012 to 2021 were as follows:
2012
2013
2014
2015
2016
2017
2018
2019
2020
2021
£25,000
£25,000
£25,000
£25,000
£25,000
£25,000
£60,000
£60,000
£60,000
£60,000
The annual amounts paid above relate to salary only. The Executive Chairman did not receive any discretionary payments
during these periods.
Relative importance of spend on pay
The total dividends or other cash distributions to shareholders during the year was £nil (2020: £479,169), see note 9. The
total employee remuneration (including Directors) during the year was £5.705m (2020: £5.171m).
Triad Group Plc Annual Report and Accounts 2021
| 27
Directors’ remuneration report
Percentage change in Directors’ remuneration
The tables below show the change in Directors’ remuneration compared to the employees of the Company, where Directors
and employees have been employed by Triad for the full relevant financial years.
Basic salary and fees
J C Rigg
A Leer
T J Eckes
J McDonald
A M Fulton
C J Duckworth
C Rigg
Employees of the company
Benefits in kind ¹
J C Rigg
A Leer
T J Eckes
J McDonald
A M Fulton
C J Duckworth
C Rigg
Employees of the company
¹ The negative values in this table represent a reduction in costs for the provision of identical benefits
Other (includes commission and bonus payments)
J C Rigg
A Leer
T J Eckes
J McDonald
A M Fulton
C J Duckworth
C Rigg
Employees of the company
2 Represents back pay paid in 2020
2021
0%
0%
n/a
n/a
0%
0%
n/a
3.7%
2021
n/a
(1.7%)
n/a
n/a
n/a
n/a
n/a
(5.7%)
2021
n/a
n/a
n/a
n/a
(100%) ²
n/a
n/a
(9.5%)
Consideration of matters related to Directors’ remuneration
During the financial year, the remuneration committee met once to discuss Directors’ remuneration. No external advice was
sought in relation to matters discussed at this meeting.
Alistair Fulton
Chairman, Remuneration Committee
14 June 2021
28
| Triad Group Plc Annual Report and Accounts 2021
Independent auditors’ report to the members of Triad Group Plc
Opinion on the financial statements
In our opinion:
•
•
•
•
•
the financial statements give a true and fair view of the state of the Group’s and of the Parent Company’s affairs as at 31
March 2021 and of the Group’s and Parent Company’s profit for the year then ended;
the Group financial statements have been properly prepared in accordance with international accounting standards in
conformity with the requirements of the Companies Act 2006;
the Group financial statements have been properly prepared in accordance with international financial reporting
standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union;
the Parent Company financial statements have been properly prepared in accordance with international accounting
standards in conformity with the requirements of the Companies Act 2006; and
the financial statements have been prepared in accordance with the requirements of the Companies Act 2006; and, as
regards the Group financial statements, Article 4 of the IAS Regulation.
We have audited the financial statements of Triad Group Plc (the ‘Parent Company’) and its subsidiaries (the ‘Group’) for the
year ended 31 March 2021 which comprise Group and Company statements of comprehensive income and expense, the
Group and Company statements of changes in equity, the Group and Company statements of financial position, the Group
and Company statements of cash flows and notes to the financial statements, including a summary of significant accounting
policies. The financial reporting framework that has been applied in their preparation is applicable law and international
accounting standards in conformity with the requirements of the Companies Act 2006 and international financial reporting
standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union.
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 believe that the audit evidence we have
obtained is sufficient and appropriate to provide a basis for our opinion. Our audit opinion is consistent with the additional report
to the audit committee.
Independence
Following the recommendation of the audit committee, we were appointed by the Directors to audit the financial statements
for the year ended 31 March 2006 and subsequent financial periods. The period of total uninterrupted engagement
including retenders and reappointments is 16 years, covering the years ending 31 March 2006 to 31 March 2021. We remain
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 public interest entities,
and we have fulfilled our other ethical responsibilities in accordance with these requirements. The non-audit services
prohibited by that standard were not provided to the Group or the Parent Company.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in
the preparation of the financial statements is appropriate. Our evaluation of the Directors’ assessment of the Group and the
Parent Company’s ability to continue to adopt the going concern basis of accounting included:
•
•
•
We considered the nature of the Group, its business model and related risks to going concern arising.
We evaluated the Directors’ assessment of the Group’s ability to continue as a going concern, including challenging the
underlying data by comparing it to actual performance in the previous financial year, client contracts and comparing
it to post year-end financial performance. We challenged the key assumptions used, including recoverability of trade
receivables, levels of future revenue and staff costs by comparing them against previous financial performance and
enquires with management.
We examined the forecasts and stress test provided by the Group. We tested the integrity of the models by checking
the formulae, the arithmetic accuracy and any hard coding.
Triad Group Plc Annual Report and Accounts 2021
| 29
Independent auditors’ report to the members of Triad Group Plc
•
•
Enquires were made of management as to any future events or conditions that may affect the Group’s ability to continue
as a going concern, we have also inspected the minutes of Board meetings to support our enquiries.
We obtained confirmation of the financing facilities available to the Group and assessed the availability of cash to the
Group over the forecast period and the level of headroom available.
Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions
that, individually or collectively, may cast significant doubt on the Group and Parent Company’s ability to continue as a going
concern for a period of at least twelve months from when the financial statements are authorised for issue.
In relation to the Parent Company’s reporting on how it has applied the UK Corporate Governance Code, we have nothing
material to add or draw attention to in relation to the Directors’ statement in the financial statements about whether the
Directors considered it appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors with respect to going concern are described in the relevant
sections of this report.
Overview
Coverage
All subsidiary entities in the Group are dormant as such 100% of the Group profit, revenue and assets
have been subject to full scope audit.
Key audit matters
Revenue recognition
Going concern and Covid-19
2021
X
2020
X
X
Going concern and Covid-19 is no longer considered to be a key audit matter because the Group has
performed well throughout the pandemic.
Materiality
Group financial statements as a whole
£89k (2020: £97k) based on 0.5% (2020: 0.5%) of revenue
An overview of the scope of our audit
Our Group audit was scoped by obtaining an understanding of the Group and its environment, including the Group’s system
of internal control, and assessing the risks of material misstatement in the financial statements. We also addressed the risk
of management override of internal controls, including assessing whether there was evidence of bias by the Directors that
may have represented a risk of material misstatement.
The Group operates solely in the United Kingdom. The Group financial statements are a consolidation of six companies made
up of one trading Company (the Parent Company) which provides consultancy and development services and five dormant
companies. In establishing the overall approach to the Group audit, we determined the type of work that needed to be
performed on each Company.
Based on our assessment we performed an audit of the complete financial information of the Parent Company as the only
trading Company and only significant component.
30
| Triad Group Plc Annual Report and Accounts 2021
Independent auditors’ report to the members of Triad Group Plc
Key audit matters
Key audit matters are those matters that, in our professional judgement, were of most significance in our audit of the
financial statements of the current period and include the most significant assessed risks of material misstatement (whether
or not due to fraud) that we identified, 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. This matter 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 this matter.
Key audit matter
Revenue recognition
As detailed in note 1
and 4 to the financial
statements.
Revenue is recognised
predominantly on a time and
materials basis. Agreements to
place a number of consultants
for a period of time are agreed
with customers. Revenue is
then recognised based on
the timesheets recorded and
approved, either internally or
externally, and a charge is
calculated at an agreed hourly
rate as per the contract.
We considered there to be
a significant risk over the
completeness of revenue
due to potential missing or
late timesheets or contractor
invoices and existence of
revenue through fraudulent
manual postings to revenue.
How the scope of our audit addressed key audit matter
We tested the operating effectiveness controls over the approval of
external timesheets and the recording of the related sales invoices in
the accounting system.
We performed testing on a sample basis over the revenue postings pre
and post year end, agreeing the posting to supporting documentation,
ensuring the transaction is recorded in the correct period.
We performed testing on a sample basis over the contractor costs
incurred before and after the year end, agreeing these to supporting
documentation and checking that the revenue associated with these
has been recorded in the correct period.
We performed testing on a sample basis over the revenue postings
throughout the year, agreeing the posting to timecard, confirmation of
charge out rate and sales invoice, ensuring the transactions are recorded
in line with the accounting policy and in the correct accounting period.
We tested a sample of manual journal postings to revenue, agreeing
the posting to bank payment, sales invoices, credit notes and timecards
where appropriate.
We tested a sample of year end accrued and deferred income balances
and agreed them to sales invoices, bank payment where appropriate
and timecards.
We performed testing on a sample basis over the timecards received
either side of the year end, agreeing them to sales invoices to ensure
they have been recorded in the correct period.
We selected a sample of contracts for services provided in the year
and agreed the revenue recognised against the policy stipulated in
the contract to check that the revenue recognition was appropriate
and reviewed the accounting treatment to ensure compliance with the
requirements of the accounting standards.
Key observations:
We did not identify any significant issues as a result of the procedures
performed.
Triad Group Plc Annual Report and Accounts 2021
| 31
Independent auditors’ report to the members of Triad Group Plc
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.
Based on our professional judgement, we determined materiality for the financial statements as a whole and performance
materiality as follows:
Materiality
Group and Parent Company financial statements
2021
£k
89
2020
£k
97
Basis for determining materiality
0.5% of revenue
0.5% of revenue
Rationale for the benchmark applied
We consider revenue to be the most
appropriate benchmark as it is one of
the principal considerations for users of
the financial statements in assessing the
financial performance and development of
the Group.
We consider revenue to be the most
appropriate benchmark as it is one of
the principal considerations for users of
the financial statements in assessing the
financial performance and development of
the Group.
Performance materiality
58
63
Basis for determining performance
materiality
Reporting threshold
65% of materiality, the threshold was
selected to reflect the amount of balances
subject to estimation, the amount of audit
differences historically arising and the
mainly substantive approach to the audit.
65% of materiality, the threshold was
selected to reflect the amount of balances
subject to estimation, the amount of audit
differences historically arising and the
mainly substantive approach to the audit.
We agreed with the Audit Committee that we would report to them all individual audit differences in excess of £2k (2020:
£2k). We also agreed to report differences below this threshold that, in our view, warranted reporting on qualitative grounds.
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. 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
course of the audit, or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent
material misstatements, we are required to determine whether this gives rise to a material misstatement in the financial
statements themselves. If, based on the work we have performed, we conclude that there is a material misstatement of this
other information, we are required to report that fact.
We have nothing to report in this regard.
32
| Triad Group Plc Annual Report and Accounts 2021
Independent auditors’ report to the members of Triad Group Plc
Corporate governance statement
The Listing Rules require us to review the Directors’ statement in relation to going concern, longer-term viability and that
part of the Corporate Governance Statement relating to the parent company’s compliance with the provisions of the UK
Corporate Governance Statement specified for our review.
Based on the work undertaken as part of our audit, we have concluded that each of the following elements of the Corporate
Governance Statement is materially consistent with the financial statements or our knowledge obtained during the audit.
Going concern and
longer-term viability
•
•
The Directors' statement with regards to the appropriateness of adopting the going concern basis of
accounting and any material uncertainties identified set out on page 14; and
The Directors’ explanation as to its assessment of the entity’s prospects, the period this assessment
covers and why the period is appropriate set out on page 8.
Other Code provisions
• Directors' statement on fair, balanced and understandable set out on page 13;
•
•
Board’s confirmation that it has carried out a robust assessment of the emerging and principal risks
set out on page 6;
The section of the annual report that describes the review of effectiveness of risk management and
internal control systems set out on page 19; and
• The section describing the work of the audit committee set out on page 18.
Other Companies Act 2006 reporting
Based on the responsibilities described below and our work performed during the course of the audit, we are required by
the Companies Act 2006 and ISAs (UK) to report on certain opinions and matters as described below.
Strategic report and
Directors’ report
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.
In the light of the knowledge and understanding of the Group and 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.
Directors’ remuneration
In our opinion, the part of the Directors’ remuneration report to be audited has been properly prepared
in accordance with the Companies Act 2006.
Matters on which we
are required to report by
exception
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 by the Parent Company, or returns adequate
for our audit have not been received from branches not visited by us; or
the Parent Company financial statements and the part of the Directors’ remuneration report to be
audited 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.
Triad Group Plc Annual Report and Accounts 2021
| 33
Independent auditors’ report to the members of Triad Group Plc
Responsibilities of Directors
As explained more fully in the Statement of Directors’ responsibilities 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 the aggregate, they could reasonably be expected to influence the economic decisions of users
taken on the basis of these financial statements.
Extent to which the audit was capable of detecting irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in line with
our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including fraud. The extent
to which our procedures are capable of detecting irregularities, including fraud is detailed below:
•
•
•
•
•
•
We obtained an understanding of the regulatory and legal framework applicable to the Group and the industry in which it
operates and considered the risk of acts by the Group which were contrary to applicable laws and regulations, including
fraud.
These included but were not limited to compliance with the Companies Act 2006, Corporate Governance, the UK listing
rules and UK tax legislation.
We focused on laws and regulations that could give rise to a material misstatement in the Group financial statements.
Our tests included, but were not limited to the investigation, through the review of minutes and enquires of management,
of potential non-compliance with laws and regulations and review of the communications with the regulatory bodies.
Our tests included, but were not limited to, agreement of the financial statement disclosures to underling supporting
documentation, review of any correspondence with regulators and legal advisors and enquiries made of management.
We also addressed the risk of management override of internal controls, including testing journals and evaluating
whether there was evidence of bias by the Directors that represented a risk of material misstatement due to fraud.
We addressed the risk of fraud in relation to revenue recognition by reviewing amounts charged, testing the operating
effectiveness around certain key controls and investigating the manual postings to revenue. Further detail in relation to
the testing of revenue recognition has been detailed in the key audit matters section of our report.
We also communicated relevant identified laws and regulations and potential fraud risks to all engagement team members
and remained alert to any indications of fraud or non-compliance with laws and regulations throughout the audit.
34
| Triad Group Plc Annual Report and Accounts 2021
Independent auditors’ report to the members of Triad Group Plc
Our audit procedures were designed to respond to risks of material misstatement in the financial statements, recognising
that the risk of not detecting a material misstatement due to fraud is higher than the risk of not detecting one resulting from
error, as fraud may involve deliberate concealment by, for example, forgery, misrepresentations or through collusion. There are
inherent limitations in the audit procedures performed and the further removed non-compliance with laws and regulations is
from the events and transactions reflected in the financial statements, the less likely we are to become aware of it.
A further description of our responsibilities is available on the Financial Reporting Council’s website
at: www.frc.org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the Parent 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 Parent 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 Parent Company and the Parent Company’s
members as a body, for our audit work, for this report, or for the opinions we have formed.
James Fearon
(Senior Statutory Auditor)
14 June 2021
For and on behalf of BDO LLP, Statutory Auditor
London, UK
BDO LLP is a limited liability partnership registered in England and Wales (with registered number OC305127).
Triad Group Plc Annual Report and Accounts 2021
| 35
Statements of comprehensive income and expense
for the year ended 31 March 2021
Group and Company
Revenue
Cost of sales
Gross profit
Administrative expenses
Profit/(Loss) from operations
Finance income
Finance expense
Profit/(Loss) before tax
Tax Credit/(Charge)
Profit/(Loss) for the year and total comprehensive income
attributable to equity holders of the parent
Basic earnings/(loss) per share
Diluted earnings/(loss) per share
All amounts relate to continuing activities.
Note
4
5
13
6
8
10
10
2021
£’000
17,815
2020
£’000
19,354
(14,005)
(16,500)
3,810
(3,124)
686
15
(57)
644
41
685
4.28p
4.24p
2,854
(3,422)
(568)
20
(54)
(602)
(159)
(761)
(4.76p)
(4.76p)
The notes on pages 40 to 58 form part of the financial statements.
36
| Triad Group Plc Annual Report and Accounts 2021
Statements of changes in equity for the year ended 31 March 2021
Group
At 1 April 2019
Loss for the year and total
comprehensive income
Dividend paid
Ordinary shares issued
Share-based payments
Share
Capital
£’000
160
–
–
–
–
Share premium
account
Capital redemption
reserve
Retained earnings
Total
£’000
659
£’000
104
–
–
1
–
–
–
–
–
£’000
4,843
£’000
5,766
(761)
(761)
(479)
(479)
–
28
1
28
At 1 April 2020
160
660
104
3,631
4,555
Profit for the year and total
comprehensive income
Ordinary shares issued
Share-based payments
–
–
–
–
6
–
–
–
–
685
685
–
37
6
37
At 31 March 2021
160
666
104
4,353
5,283
Company
At 1 April 2019
Loss for the year and total
comprehensive income
Dividend paid
Ordinary shares issued
Share-based payments
Share
Capital
£’000
160
–
–
–
–
Share premium
account
Capital redemption
reserve
Retained earnings
Total
£’000
659
£’000
104
–
–
1
–
–
–
–
–
£’000
4,838
£’000
5,761
(761)
(761)
(479)
(479)
–
28
1
28
At 1 April 2020
160
660
104
3,626
4,550
Profit for the year and total
comprehensive income
Ordinary shares issued
Share-based payments
–
–
–
–
6
–
–
–
–
685
685
–
37
6
37
At 31 March 2021
160
666
104
4,348
5,278
Share capital represents the amount subscribed for share capital at nominal value.
The share premium account represents the amount subscribed for share capital in excess of the nominal value.
The capital redemption reserve represents the nominal value of the purchase and cancellation of its own shares by the
Company in 2002.
Retained earnings represents the cumulative net gains and losses recognised in the statement of comprehensive income
and expense.
The notes on pages 40 to 58 form part of the financial statements.
Triad Group Plc Annual Report and Accounts 2021
| 37
Statements of financial position at 31 March 2021
Non-current assets
Intangible assets
Property, plant and equipment
Right-of-use assets
Finance lease receivables
Deferred tax
Current assets
Trade and other receivables
Finance lease receivables
Cash and cash equivalents
Total assets
Current liabilities
Trade and other payables
Lease liabilities
Non-current liabilities
Long-term provisions
Lease liabilities
Total liabilities
Net assets
Shareholders’ equity
Share capital
Share premium account
Capital redemption reserve
Retained earnings
Total shareholders’ equity
Registered number 2285049
Group
Company
Note
2021
£’000
11
12
13
13
8
15
13
16
17
13
18
13
19
6
225
532
85
73
921
2,514
108
4,918
7,540
8,461
(2,248)
(307)
(2,555)
(197)
(426)
(623)
(3,178)
5,283
160
666
104
4,353
5,283
2020
£’000
10
275
622
297
32
1,236
2,741
–
3,840
6,581
7,817
(2,127)
(272)
(2,399)
(197)
(666)
(863)
(3,262)
4,555
160
660
104
3,631
4,555
2021
£’000
6
225
532
85
73
921
2,514
108
4,918
7,540
8,461
(2,253)
(307)
(2,560)
(197)
(426)
(623)
(3,183)
5,278
160
666
104
4,348
5,278
2020
£’000
10
275
622
297
32
1,236
2,741
–
3,840
6,581
7,817
(2,132)
(272)
(2,404)
(197)
(666)
(863)
(3,267)
4,550
160
660
104
3,626
4,550
The financial statements on pages 36 to 59 were approved by the Board of Directors and authorised for issue on 14 June
2021 and were signed on its behalf by:
Adrian Leer
Director
James McDonald
Director
Triad Group Plc is registered in England and Wales with registered number 2285049.
The notes on pages 40 to 58 form part of the financial statements.
38
| Triad Group Plc Annual Report and Accounts 2021
Statements of cash flows for the year ended 31 March 2021
Group and company
Cash flows from operating activities
Profit/(Loss) for the year before taxation
Adjustments for:
Profit on sale of asset
Depreciation of property, plant and equipment
Amortisation of right of use assets
Amortisation of intangible assets
Interest received
Finance expense
Share-based payment expense
Changes in working capital
Decrease in trade and other receivables
Increase/(Decrease) in trade and other payables
Increase in provisions
Cash generated by operations
Foreign exchange loss/(gain)
Net cash inflow from operating activities
Investing activities
Finance lease interest received
Finance lease payments received
Proceeds from sale of asset
Purchase of intangible assets
Purchase of property, plant and equipment
Net cash used in investing activities
Financing activities
Proceeds of issue of shares
Lease liabilities principal payments
Lease liabilities interest payments
Dividends paid
Net cash outflow from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at beginning of the period
Cash and cash equivalents at end of the period
Note
2021
£’000
2020
£’000
644
(602)
(7)
80
173
5
(15)
45
37
226
121
–
1,309
6
1,315
15
104
15
(1)
(38)
95
6
(287)
(51)
–
(332)
1,078
3,840
4,918
–
97
166
5
(20)
60
28
593
(374)
115
68
(4)
64
20
123
–
–
(166)
(23)
–
(270)
(56)
(479)
(805)
(764)
4,604
3,840
9
16
The notes on pages 40 to 58 form part of the financial statements.
Triad Group Plc Annual Report and Accounts 2021
| 39
Notes to the financial statements for the year ended 31 March 2021
1. Principal accounting policies
Basis of preparation
The principal accounting policies adopted in the
preparation of the financial statements are set out below.
The policies have been consistently applied to all the years
presented, unless otherwise stated.
These financial statements have been prepared in
accordance with international accounting standards
in conformity with the requirements of the Companies
Act 2006 and in accordance with international financial
reporting standards adopted pursuant to Regulation (EC)
No 1606/2002 as it applies in the European Union.
These financial statements have been prepared on a going
concern basis.
These financial statements have been prepared on a
historical cost basis and are presented in sterling, the
functional currency of the Company.
Going concern
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. The financial
position of the Group, its cash flows, liquidity position and
borrowing facilities are described in the Strategic report.
In addition, note 3 to the financial statements includes the
Group’s objectives, policies and processes for managing its
capital, its financial risk management objectives, details of its
financial instruments and hedging activities, and its exposure
to credit risk and liquidity risk. The Group meets its day to
day working capital requirements through cash reserves and
an invoice finance facility (which is currently unutilised).
The Group operates an efficient low-cost and historically
cash generative model. The client base generally consists of
large blue-chip entities, particularly within the public sector,
enjoying long-term and productive client relationships. As
such, debt recovery has been reliable and predictable with
a low exposure to bad debts. For the year ended 31 March
2021, the Group has not utilised any external debt, lending
facilities or accessed any Government support schemes
(2020: nil). Due to the ability to operate services remotely,
the Group has remained in full operation throughout recent
lockdown periods and will continue to do so as external
factors dictate. The success of the business during the year
ended 31 March 2021 illustrates the operational flexibility of
both the Group and its current and future client base.
The going concern assessment considered a number of
realistic scenarios including the impact of the reduction in
services of key clients upon future cash flows. In addition,
in the most severe scenario possible, a reverse stress test
was modelled which included the effects of any future
Covid-19 pandemic issues, with all current client contracts
discontinued at expiry with no extension or replacement and
with no cost mitigation. Even in the most extreme scenario,
the Group has enough liquidity and long-term contracts to
support the business through the going concern period. The
Directors have concluded from these assessments that the
Group would have sufficient headroom in cash balances to
continue in operation.
Further information in relation to the Directors’ consideration
of the going concern position of the Company is contained in
the Viability statement on page 8.
After making enquiries, the Directors have a reasonable
expectation that the Group has adequate resources to
continue in operational existence for the foreseeable future and
at least twelve months from the date of approval of the financial
statements. Accordingly, they continue to adopt the going
concern basis in preparing the annual report and accounts.
Basis of consolidation
Where the Company has control over an investee, it is classified
as a subsidiary. The Company controls an investee if all three
of the following elements are present: power over the investee,
exposure to variable returns from the investee and the ability
of the investor to use its power to affect those variable returns.
The consolidated financial statements present the results
of the Company and its subsidiaries (“the Group”) as if they
formed a single entity. Intercompany transactions and balances
between Group companies are therefore eliminated in full.
Property, plant and equipment
Property, plant and equipment are stated at cost, net of
accumulated depreciation and any impairment in value.
Depreciation is calculated as to write off the cost of assets,
less their estimated residual values, on a straight-line basis
over the expected useful economic lives of the assets
concerned. Depreciation is charged to administrative
expenses in the statement of comprehensive income and
expense. The principal annual rates used for this purpose are:
Computer hardware
Fixtures and fittings
Motor vehicles
Leasehold improvements
%
25–33
10–33
25–33
10–33
40
| Triad Group Plc Annual Report and Accounts 2021
Notes to the financial statements for the year ended 31 March 2021
Intangible assets
Intangible assets are stated at cost, net of accumulated
amortisation and any impairment in value. The cost of
internally developed software is the attributable salary
costs and directly attributable overheads.
Amortisation is calculated to write off the cost of assets, less
their estimated residual values, on a straight-line basis over
the expected useful economic lives of the assets concerned.
Amortisation is charged to administration expenses in the
statement of comprehensive income and expense. The
principal annual rates used for this purpose are:
Purchased computer software
Impairment of non-financial assets
%
25–33
Non-financial assets are subject to impairment tests whenever
events or changes in circumstances indicate that their carrying
amount may not be recoverable. Where the carrying value of an
asset exceeds its recoverable amount the asset is written down
accordingly. Impairment is charged to administration expenses
in the statements of comprehensive income and expense.
Trade and other receivables
Trade and other receivables are initially recognised at fair
value plus transaction costs, and subsequently measured
at amortised cost using the effective interest method, less
provision for impairment.
At each reporting date an amount of impairment is recognised
as lifetime expected credit losses (lifetime ECL’s).
Lifetime ECL’s are calculated using a provision matrix that
groups trade receivables according to the time past due,
and at provision rates based on historical observed default
rates, adjusted for forward looking estimates. At every
reporting date, the historical observed default rates and
forward-looking estimates are updated.
Amounts are written off to administrative expenses
against the carrying amount of trade receivables when it is
certain that the receivable will not be realised.
Cash
Leases
The Group as Lessee:
All leasing arrangements, where the Group is the lessee
(defined as leases that last more than one year or of a high
value), are recognised as a lease liability and corresponding
right-of-use asset.
Lease liability:
The lease liability is calculated as the discounted total
fixed payments for the lease term, termination payments,
exercise price of purchase options, residual value
guarantee and certain variable payments. An interest
charge is recognised in the statement of comprehensive
income and expense on the lease liability at an incremental
borrowing rate. The lease liability is presented across
separate lines (current and non-current) in the statement
of financial position. The lease liability increases to reflect
the interest charge on the lease liability, at an incremental
borrowing rate. The lease liability reduces over the period
of the lease as payments are made. The lease liability is
re-calculated if there is a modification, a change in the
lease term, a change in the lease payments or a change
in the assessment to purchase the underlying assets. A
re-calculation has been made in the period in respect of a
change in the lease payments.
Right-of-use assets:
The right-of-use asset is calculated as the original lease
liability, initial direct costs and amounts paid upfront. The
right of use asset is subsequently measured at cost less
accumulated amortisation. The amortisation is charged on
a straight-line basis over the life of the lease.
The Group as lessor:
For the year ended 31 March 2021 lessor arrangements
follow the accounting treatment ‘IFRS 16 Leases’. Where
the lease indicates a finance lease a lease receivable
is recognised. The lease receivable is calculated as the
discounted total lease receipts for the lease term.
Interest income is subsequently recognised in the
statement of comprehensive income and expense on the
lease receivable and the balance reduces over the lease
term as receipts are received.
Cash in the statement of financial position comprises cash
held on demand with banks.
Foreign currencies
Trade and other payables
Trade and other payables are recognised initially at fair
value, and subsequently measured at amortised cost using
the effective interest method.
Assets and liabilities expressed in foreign currencies are
translated into sterling at the exchange rate ruling on the
date of the statement of financial position. Transactions
in foreign currencies are recorded at the exchange rate
ruling as at the date of the transaction. All differences on
exchange are taken to the statement of comprehensive
income and expense in the year in which they arise.
Triad Group Plc Annual Report and Accounts 2021
| 41
Notes to the financial statements for the year ended 31 March 2021
Revenue
Revenue recognised in any financial period is based on the
delivery of performance obligations and an assessment
of when control is transferred to the customer. Revenue is
either recognised at a ‘point in time’ when a performance
obligation has been performed, or ‘over time’ as control of
the performance obligation is transferred to the customer.
The majority of the Group’s revenue is derived from the
provision of services under time and materials contracts.
Performance obligations under such contracts relate to
the provision of staff to customers. The transaction price
of the performance obligation is determined by reference
to charge-out rates for supplied staff and are specified in
the contract. Since the customer simultaneously receives
and consumes the benefits of the Group’s performance
obligations under such contracts, revenue is recognised
over time using the output method which uses a direct
measurement of value to the customer of the services
transferred to date.
Where temporary workers are supplied to customers, the
associated revenue is recognised gross (inclusive of the
cost of the temporary workers) since the Group is acting
as principal. Under IFRS 15, in order to be recognised as
principal, there must be a transfer of control between
the vendor and the customer. Where the Group provides
temporary contractors, it is acting as principal since it
receives resourcing requirements directly from the customer,
has prime responsibility to find suitable candidates and
negotiate pay rates with them, and delivers the resources
to the client including acceptance that the service provided
meets the client’s expectations. Revenue is therefore
recognised as the gross amount invoiced to customers.
In relation to time and materials contracts, since it has a
right to consideration from a customer in an amount that
corresponds directly with the value to the customer of
the Group’s performance completed to date, the Group
recognises revenue in the amount to which it has a right
to invoice.
Revenue from fixed price contracts, which may include
software and product development or support contracts,
is determined by reference to those fixed prices, agreed
at inception of the contract. For fixed price contracts
revenue is recognised on an over time basis using the
input (percentage completion) method. Percentage
completion is calculated as the total hours worked as at
the statement of financial position date divided by the total
expected hours to be worked to complete the project.
42
| Triad Group Plc Annual Report and Accounts 2021
Revenue for permanent recruitment services is based on
a percentage of a successful candidate’s remuneration
package, as agreed with the customer at inception of the
contract. Revenue is recognised at a point in time when
the performance obligation has been satisfied at the time
the candidate commences employment and subject to a
provision for clawback of fees for candidates that leave
prior to the notice period ending.
The Company has taken advantage of the practical
exemption not to disclose the value of unfilled performance
obligations as the contracts ongoing at the period end are
for less than 12 months.
Taxation
The charge for taxation is based on the profit or loss for
the year as adjusted for disallowable items. It is calculated
using tax rates that have been enacted or substantively
enacted by the statement of financial position date.
Full provision is made for deferred tax on all temporary
differences resulting from the difference between the
carrying value of an asset or liability and its tax base, and
on tax losses carried forward indefinitely. Deferred tax
assets are recognised to the extent that it is probable that
the deferred tax asset will be recovered in the foreseeable
future. Deferred tax is calculated at the tax rates that are
expected to apply to the period when the asset is realised
or liability is settled.
Pension costs
Contributions to defined contribution plans are charged to
the statements of comprehensive income and expense as
the contributions accrue.
Share-based payments
Share-based incentive arrangements are provided to
employees under the Group’s share option scheme. Share
options granted to employees are valued at the date of
grant using an appropriate option pricing model and are
charged to operating profit over the performance or vesting
period of the scheme. The annual charge is modified to
take account of shares forfeited by employees who leave
during the performance or vesting period and, in the case
of non-market related performance conditions, where it
becomes unlikely the option will vest.
Provisions
A provision is recognised when the Group has a legal or
constructive obligation as a result of a past event and it
is probable that an outflow of economic benefits will be
required to settle the obligation. If the effect is material,
expected future cash flows are discounted using a current
pre-tax rate that reflects the risks specific to the liability.
Calculations of these provisions require judgements to be
made. The Group has provided for property dilapidation as
detailed in note 18.
Notes to the financial statements for the year ended 31 March 2021
New standards and interpretations
3. Financial risk management
A number of amendments to existing standards have been
issued but which are not yet mandatory, and have not
been adopted by the Group in these financial statements.
The Directors do not anticipate that their adoption in
future periods will have a material impact on the financial
statements of the Group.
2. Critical accounting estimates and
judgements
Estimates and judgements are continually evaluated
based on historical experience and other factors,
including expectations of future events that are believed
to be reasonable under the circumstances. The Group
makes estimates and assumptions concerning the future.
The resulting accounting estimates will, by definition,
seldom equal the related actual results. The estimates
and assumptions that have a significant risk of causing a
material adjustment to the carrying amounts of assets and
liabilities within the next financial year are discussed below.
IFRS 16 leases
A right-of-use asset of £0.5m (2020: £0.6m), a total
lease liability of £0.7m (2020: £0.9m) and a finance lease
receivable of £0.2m (2020: £0.3m) have been recognised
in accordance with the accounting policies on page 41 with
respect to IFRS 16 ‘Leases’. During the year a rent review
was undertaken on the Milton Keynes lease, which resulted
in an increase to the right of use asset and to the lease
liability of £0.08m. The Directors have made the following
critical accounting estimates and judgements in relation to
these balances:
•
•
Lease term: The Directors are of the opinion that
property lease assets and liabilities should be
calculated with relation to the first available break date
as the expectation is that the lease break will be taken.
Incremental borrowing rate (IBR): The Directors have
calculated the IBR at 5%, based upon readily available
credit facilities and Bank of England base rate,
covering a time frame commensurate with the time to
the first available break date.
Dilapidation provisions:
The Directors have recognised a dilapidation provision for
both the leases held totalling £197,000 (2020: £197,000).
The provision is required to recognise the costs of
restoring the properties to their original state at the end of
the lease period. The provision has been calculated using
generally accepted industry averages of between 15 and
20% of lease costs and the Directors’ experience with the
landlords as well as experience in similar negotiations.
The Group uses financial instruments that are necessary to
facilitate its ordinary purchase and sale activities, namely
cash, bank borrowings in the form of a receivables finance
facility and trade payables and receivables: the resultant
risks are foreign exchange risk, interest rate risk, credit
risk and liquidity risk. The Group does not use financial
derivatives in its management of these risks.
The Board reviews and agrees policies for managing these
risks and they are summarised below. These policies are
consistent with last year.
3.1 Financial risk factors
Foreign exchange risk
There are a small number of routine trading contracts with
both suppliers and clients in euros. In all such circumstances
the contracts with supplier and client will be in the same
currency thereby mitigating the Group’s exposure to
movements in exchange rates. Payments and receipts are
made through a bank account in the currency of the contract
therefore balances held in any foreign currency are to
facilitate day to day transactions. With a functional currency
of sterling there are the following foreign currency net assets:
Group and company
Note
2021
£'000
2020
£'000
Currency: Euros
Cash and cash equivalents
Trade and other receivables
Trade and other payables
16
15
17
156
–
(10)
146
132
19
(25)
126
Any change in currency rates would have no significant
effect on results.
Interest rate risk
The Group has access to a financing facility with a major
UK bank. At the balance sheet date in the current or prior
year this facility has not been utilised.
Cash balances are held in short-term interest-bearing
accounts, repayable on demand: these attract interest rates
which fluctuate in relation to movements in bank base rate.
This maintains liquidity and does not commit the Group to
long-term deposits at fixed rates of interest.
There were no borrowings, aside from lease liabilities
arising from the application of IFRS 16, during the year.
Triad Group Plc Annual Report and Accounts 2021
| 43
Notes to the financial statements for the year ended 31 March 2021
Credit risk
Liquidity risk
The Group is mainly exposed to credit risk from credit sales.
It is Group policy to assess the credit risk of new customers
before entering into contracts. Each new customer is assessed,
using external ratings and relevant information in the public
domain, before any credit limit is granted. In addition, trade
receivables balances are monitored on a regular basis to
minimise exposure to credit losses. The amount credited to the
income statement during the year in respect of expected credit
losses was £7,000 (2020: charged to the income statement
£6,000).
The Group is also exposed to credit risk from contract assets,
being revenue earned but not yet invoiced (note 15).
The Group also has credit risk from cash deposits with banks
(note 16).
The Group’s maximum exposure to credit risk is:
Finance lease receivable
Trade and other receivables
Contract assets
Other debtors
Cash and cash equivalents
Note
2021
£'000
2020
£'000
13
15
15
15
16
193
297
1,996
2,500
170
229
68
17
4,918
3,840
7,506
6,722
The Group’s liquidity risk arises from its management of
working capital. The Group has a facility to borrow an
amount up to 90% of approved trade debtors subject to
a maximum limit of £2.6m. The facility may be terminated
by the bank and Group with one and three month’s written
notice respectively. The Board receives regular cash flow
and working capital projections to enable it to monitor its
available headroom under this facility. At the statement
of financial position these projections indicated that the
Group expected to have sufficient liquid resources to meet
its reasonably expected obligations. Maturity of financial
liabilities is set out in note 17.
Capital risk management
The Group’s capital comprises of shareholders’ equity. Its
objectives when managing capital are to safeguard the Group’s
ability to continue as a going concern in order to maximise
shareholder value. To maintain or adjust the capital structure
the Group may adjust the dividend payment to shareholders,
return capital to shareholders, issue new shares or alter the
level of borrowings.
3.2 Fair value estimation
The carrying value of financial assets and liabilities
approximate their fair values.
44
| Triad Group Plc Annual Report and Accounts 2021
Notes to the financial statements for the year ended 31 March 2021
4. Revenue
The Group operates solely in the UK. All material revenues are generated in the UK.
The largest single customer contributed 47% of Group revenue (2020: 39%) and was in the public sector. One other
customer contributed more than 10% of Group revenue (2020: one).
Disaggregation of revenue
In accordance with IFRS 15, the Group disaggregates revenue by contract type as management believe this best depicts how
the nature, timing and uncertainty of the Group’s revenue and cash flows are affected by economic factors. Accordingly, the
following table disaggregates the Group’s revenue by contract type:
Group and company
Time and materials
Fixed price
Percentage fee based
2021
£'000
17,344
175
296
2020
£'000
19,017
82
255
17,815
19,354
The Group also disaggregates revenue by operating sector reflecting the different commercial risks (e.g. credit risk) associated
with each.
Group and company
Public sector
Private sector
Contract balances
2021
£'000
11,357
6,458
17,815
2020
£'000
10,277
9,077
19,354
For all contracts, the Group recognises a contract liability to the extent that payments made are greater than the revenue
recognised at the period end date. When payments are made less than the revenue recognised at the period end date, the Group
recognises a contract asset for the difference.
Contract assets and contract liabilities are included within ‘trade and other receivables’ and ‘trade and other payables’
respectively on the face of the statement of financial position.
Group and company
At 1 April
Transfers in the period from contract assets to trade receivables
Excess of revenue recognised over cash (or right to cash) being
recognised in the period
Amounts included in contract liabilities that was recognised as
revenue in the period
Cash received in advance of performance and not recognised as
revenue in the period
At 31 March
Contract assets
Contract liabilities
2021
£’000
2020
£’000
68
(68)
170
–
–
170
58
(58)
68
–
–
68
2021
£’000
(41)
–
–
41
(256)
(256)
2020
£’000
(43)
–
–
43
(41)
(41)
There is no expectation of a material expected lifetime credit loss arising in relation to contract assets.
Triad Group Plc Annual Report and Accounts 2021
| 45
Notes to the financial statements for the year ended 31 March 2021
5. Profit/(Loss) from operations
Profit/(Loss) from operations is stated after charging:
Profit on disposal of fixed asset
Depreciation of owned assets
Amortisation of right of use assets
Amortisation of intangible assets
Low value lease
Auditor remuneration:
Audit of financial statements: Group and company
6. Finance expense
Other interest payable
Interest expense on lease liability
Net foreign exchange loss/(gain)
Total finance expense
7. Employees and Directors
Group and company
Average number of persons (including Directors) employed
Senior management
Fee earners
Sales
Administration and finance
The number of permanent fee earners as at 31 March 2021 was 58 (2020: 37).
Staff costs for the above persons (including Directors)
Wages and salaries
Social security costs
Defined contribution pension costs
Equity settled share-based payments
46
| Triad Group Plc Annual Report and Accounts 2021
2021
£'000
2020
£'000
(7)
80
173
5
–
61
2021
£'000
–
51
6
57
–
97
166
5
6
59
2020
£'000
1
56
(3)
54
2021
Number
2020
Number
9
42
8
9
68
2021
£'000
4,599
537
532
37
5,705
8
37
10
7
62
2020
£'000
4,176
482
485
28
5,171
Notes to the financial statements for the year ended 31 March 2021
Directors
Emoluments
Benefits in kind
Money purchase pension contributions
Total remuneration
Social security costs
2021
£'000
593
18
57
668
73
741
2020
£'000
554
29
49
632
65
697
Three Directors (2020: three) had retirement benefits accruing under money purchase pension schemes. Key management
personnel are considered to be the Directors. James McDonald was employed in February 2020 followed by a handover
period prior to his appointment as Finance Director on 16 June 2020. During this handover period he was considered to be key
management and his remuneration is included in the emoluments for the year ending 31 March 2020.
The 2020 emoluments includes a one-time discretionary settlement fee for loss of Directors’ office of £30,000.
8. Tax (credit)/charge
Current tax
Current tax on profits for the year
Deferred tax
(Increase)/Decrease in recognised deferred tax asset
Total tax charge for the year
2021
£'000
–
(41)
(41)
2020
£'000
–
159
159
The differences between the actual tax charge for the year and the standard rate of corporation tax in the UK applied to profits
for the year are as follows:
Profit/(Loss) before tax
Profit/(Loss) before tax multiplied by standard rate of corporation tax in the UK of 19%
(2020: 19%)
Expenses not deductible for tax purposes
(Recognition)/reversal of deferred tax on losses
Movement in deferred tax not recognised for current year losses
Prior year adjustments
Tax (credit)/charge for the year
2021
£'000
644
122
2
(165)
–
–
(41)
2020
£'000
(602)
(114)
13
156
101
3
159
Triad Group Plc Annual Report and Accounts 2021
| 47
Notes to the financial statements for the year ended 31 March 2021
Deferred tax asset
The movement in deferred tax is as follows:
At beginning of the year
Reversal/(Recognition) of previously unrecognised deferred tax on losses
Decrease in relation to timing differences
At end of the year
2021
£'000
32
41
–
73
2020
£'000
191
(149)
(10)
32
Deferred tax assets have been recognised in respect of tax losses where the Directors believe it is probable that the
assets will be recovered. This expectation of recovery is calculated by modelling conservative estimates of future taxable
profits that can be offset with historic trading losses brought forward. A deferred tax asset amounting to £550,000 (2020:
£710,000) has not been recognised in respect of trading losses of £2,896,000 (2020: £3,741,000), which can be carried
forward indefinitely.
The Chancellor recently announced that the main rate of UK corporation tax is to increase on 1 April 2023 from 19% to 25%.
The prevailing corporation tax rate of 19% has been reflected in the calculation of the deferred tax.
9. Dividends
Final dividend for the year ended 31 March 2020 – nil per share
Interim dividend for the year ended 31 March 2021 – nil per share
Total dividend paid
The Directors propose a final dividend of 2p per share (2020: nil per share).
10. Earnings per ordinary share
2021
£'000
–
–
–
2020
£'000
319
160
479
Earnings per share have been calculated on the profit for the year divided by the weighted average number of shares in
issue during the period based on the following:
Profit/(Loss) for the year
Average number of shares in issue
Effect of dilutive options
Average number of shares in issue plus dilutive options
Basic earnings/(loss) per share
Diluted earnings/(loss) per share
2021
£685,000
15,994,082
176,113
16,170,195
4.28p
4.24p
2020
£(761,000)
15,972,842
–
15,972,842
(4.76)p
(4.76)p
48
| Triad Group Plc Annual Report and Accounts 2021
Notes to the financial statements for the year ended 31 March 2021
11. Intangible assets
Group and Company
Cost
At 31 March 2019
Additions
Disposals
At 31 March 2020
Additions
Disposals
At 31 March 2021
Accumulated amortisation/impairment
At 31 March 2019
Charge for the year
Disposals
At 31 March 2020
Charge for the year
Disposals
At 31 March 2021
Net book value
At 31 March 2021
At 31 March 2020
Purchased software
£'000
126
–
–
126
1
–
127
111
5
–
116
5
–
121
6
10
Triad Group Plc Annual Report and Accounts 2021
| 49
Notes to the financial statements for the year ended 31 March 2021
12. Property, plant and equipment
Group and company
Computer
hardware
£'000
Fixtures
& fittings
£'000
Motor
vehicles
£'000
Total
£'000
Cost
At 31 March 2019
Additions
Disposals
At 31 March 2020
Additions
Disposals
At 31 March 2021
Accumulated depreciation
At 31 March 2019
Charge for the year
Disposals
At 31 March 2020
Charge for the year
Disposals
At 31 March 2021
Net book value
At 31 March 2021
At 31 March 2020
13. Leases
The Group as a lessee:
179
29
(17)
191
31
(3)
219
134
26
(17)
143
22
(3)
162
57
48
394
138
(30)
502
7
–
509
255
62
(30)
287
54
–
341
168
215
39
–
–
39
–
(35)
4
18
9
–
27
4
(27)
4
–
12
612
167
(47)
732
38
(38)
732
407
97
(47)
457
80
(30)
507
225
275
The Group has leases contracts for its office premises with terms remaining ranging from 2 to 4 years. The lease liability has
been calculated on the basis of the termination option being taken. There are no other future cash outflows in relation to the
lease to which the Group is potentially exposed. Each lease is represented on the balance sheet as a right of use asset and
a lease liability. Short-term leases are not recognised and expensed to the profit and loss statement. A property lease was
subject to a rent review during the year based upon prevailing rental evidence as at October 2019 and this increased the
right-of-use asset and lease liability by £83k.
50
| Triad Group Plc Annual Report and Accounts 2021
Notes to the financial statements for the year ended 31 March 2021
Right-of-use assets
The carrying amounts of the right-of-use assets are as follows:
At 31 March 2019
Opening position
Amortisation
At 31 March 2020
Rent review increase
Amortisation
At 31 March 2021
Lease liabilities
The carrying amount of the lease liabilities recognised are as follows:
At 31 March 2019
Opening position
Interest expense
Lease payments
At 31 March 2020
Rent review increase
Interest expense
Lease payments
At 31 March 2021
Land and buildings
£'000
788
(166)
622
83
(173)
532
Land and buildings
£'000
1,128
56
(246)
938
82
51
(338)
733
Total
£'000
788
(166)
622
83
(173)
532
Total
£'000
1,128
56
(246)
938
82
51
(338)
733
At the balance sheet date, the Group had outstanding discounted commitments for future lease payments as follows:
At 31 March 2021
Lease liabilities
Up to
3 months
£’000
77
Between
3 and 12 months
Between
1 and 2 years
Between
2 and 5 years
£'000
230
£'000
269
£'000
157
As at 31 March 2020, the Group had outstanding discounted commitments for future lease payments as follows:
At 31 March 2020
Lease liabilities
Up to
3 months
£’000
54
Between
3 and 12 months
Between
1 and 2 years
Between
2 and 5 years
£'000
218
£'000
288
£'000
378
Triad Group Plc Annual Report and Accounts 2021
| 51
Notes to the financial statements for the year ended 31 March 2021
At the balance sheet date, the Group had outstanding undiscounted commitments for future lease payments as follows:
At 31 March 2021
Lease liabilities
Up to
3 months
£’000
86
Between
3 and 12 months
Between
1 and 2 years
Between
2 and 5 years
£'000
258
£'000
290
£'000
167
As at 31 March 2020, the Group had outstanding undiscounted commitments for future lease payments as follows:
Up to
3 months
£’000
76
Between
3 and 12 months
Between
1 and 2 years
Between
2 and 5 years
£'000
241
£'000
322
£'000
406
At 31 March 2020
Lease liabilities
The Group as a lessor:
Finance lease receivables
The Group has entered into a lease arrangement considered to be a finance lease, representing rentals payable to the
Group for a rental of a proportion of a leased property. The carrying amounts of the lease receivable asset are as follows:
At 31 March 2019
Opening position
Interest income
Payments received
At 31 March 2020
Interest income
Payments received
At 31 March 2021
Land and buildings
£'000
420
20
(143)
297
15
(119)
193
Total
£'000
420
20
(143)
297
15
(119)
193
At the balance sheet date, the Group had discounted future lease receivables as follows:
At 31 March 2021
Lease receivables
Up to
3 months
£’000
27
Between
3 and 12 months
Between
1 and 2 years
£'000
81
£'000
85
52
| Triad Group Plc Annual Report and Accounts 2021
Notes to the financial statements for the year ended 31 March 2021
As at 31 March 2020, the Group had discounted future lease receivables as follows:
At 31 March 2020
Lease receivables
Up to
3 months
£’000
26
Between
3 and 12 months
Between
1 and 2 years
Between
2 and 5 years
£'000
78
£'000
108
£'000
85
At the balance sheet date, the Group had undiscounted future lease receivables as follows:
At 31 March 2021
Lease receivables
Up to
3 months
£’000
30
Between
3 and 12 months
Between
1 and 2 years
£'000
89
£'000
89
As at 31 March 2020, the Group had undiscounted future lease receivables as follows:
At 31 March 2020
Lease receivables
Up to
3 months
£’000
30
Between
3 and 12 months
Between
1 and 2 years
Between
2 and 5 years
£'000
89
£'000
119
£'000
89
The total lease receivable of £193k (2020: £297k) is disclosed as non-current assets of £85k and current assets of £108k.
The comparative disclosure for 2020 has not been made.
Triad Group Plc Annual Report and Accounts 2021
| 53
Notes to the financial statements for the year ended 31 March 2021
14. Investments
Company
Investments are:
(a) Generic Software Consultants Limited (“Generic”), a 100% subsidiary undertaking, in respect of both voting rights and
issued shares, which is registered in England and Wales and has an issued share capital of 5,610 US$1 ordinary shares.
The investment is stated in the Company’s books at £440.
Up to 31 March 2009 Generic acted as an agent for the business, but did not enter into any transactions in its own
right: its business was included within the figures reported by the Company. On 1 April 2009 the agency agreement was
terminated and all business is now conducted directly by the parent company through its Generic business.
(b) Triad Special Systems Limited, Generic Online Limited, Zubed Geospatial Limited, Zubed Sales Limited, are all 100%
subsidiaries which are registered in England and Wales. They are dormant companies, which have never traded. Each
has a share capital of £1.
The registered office of Triad Special Systems is Huxley House, Weyside Park, Catteshall Lane, Godalming, Surrey
GU7 1XE. The registered office of the other subsidiaries is 3 Caldecotte Lake Business Park, Caldecotte Lake Drive,
Caldecotte, Milton Keynes MK7 8LF.
15. Trade and other receivables
Group and company
Trade receivables
Less: provision for expected credit losses
Trade receivables-net
Contract assets
Other debtors
Trade and other receivables
Prepayments
2021
£'000
2,015
(19)
1,996
170
229
2,395
119
2,514
2020
£'000
2,526
(26)
2,500
68
17
2,585
156
2,741
Other debtors of £229k (2020: £17k) is with respect to legal costs recoverable and accrued interest thereon with a
shareholder who holds more than 20% of the company’s issued share capital. The fair value of trade and other receivables
approximates closely to their book value.
The lifetime expected credit losses on trade receivables as at 31 March 2021 is calculated as follows:
Group and company
Expected
default rate
Gross carrying
amount
Credit loss
allowance
Current
Up to 30 days past due
(A)
%
0.75
5.0
(B)
£'000
1,931
84
2,015
(A x B)
£'000
15
4
19
No provision has been recognised for contract assets and other debtors as they are expected to be fully recovered.
54
| Triad Group Plc Annual Report and Accounts 2021
Notes to the financial statements for the year ended 31 March 2021
The lifetime expected credit losses on trade receivables as at 31 March 2020 were calculated as follows:
Group and company
Expected
default rate
Gross carrying
amount
Credit loss
allowance
Current
Up to 30 days past due
Movements on the provision for expected credit loss are as follows:
Group and company
At beginning of the year
Charged to income statement
Credited to income statement
At end of the year (credit loss allowance)
(A)
%
0.5
5.0
(B)
£'000
2,236
290
2,526
2021
£'000
26
–
(7)
19
The carrying amount of the Group’s trade and other receivables are denominated in the following currencies:
Group and company
Sterling
Euros
16. Cash and cash equivalents
Group and company
Cash available on demand
The fair value of cash and cash equivalents approximates closely to their book value.
2021
£'000
2,395
–
2,395
2021
£'000
4,918
(A x B)
£'000
11
15
26
2020
£'000
20
6
–
26
2020
£'000
2,566
19
2,585
2020
£'000
3,840
Triad Group Plc Annual Report and Accounts 2021
| 55
Notes to the financial statements for the year ended 31 March 2021
The carrying amount of the Group’s cash and cash equivalents is denominated in the following currencies:
Group and company
Sterling
Euros
2021
£'000
4,762
156
4,918
2020
£'000
3,708
132
3,840
For the purpose of the consolidated cash flow statement, cash and cash equivalents consist of cash, as detailed above.
17. Trade and other payables
Trade payables
Accruals
Owed to subsidiary
Contract liabilities
Other taxation and social security
Group
Company
2021
£’000
923
324
–
1,247
256
745
2,248
2020
£’000
1,205
312
–
1,517
41
569
2,127
2021
£’000
923
324
5
1,252
256
745
2,253
The majority of trade and other payables are settled within three months from the year end.
The fair value of trade and other payables approximates closely to their book value.
The carrying amount of trade and other payables is denominated in the following currencies:
Sterling
Euros
Group
Company
2021
£’000
1,237
10
1,247
2020
£’000
1,475
25
1,500
2021
£’000
1,242
10
1,252
2020
£’000
1,205
312
5
1,522
41
569
2,132
2020
£’000
1,480
25
1,505
56
| Triad Group Plc Annual Report and Accounts 2021
Notes to the financial statements for the year ended 31 March 2021
18. Provisions
Group and company
At 1 April 2020
Additions
Charged to income statement
Utilised in year
At 31 March 2021
The maturity profile of the present value of provisions is as follows:
Group and company
Non-current
Provision for property dilapidation
Provision for
property dilapidation
£’000
197
–
–
–
197
2021
£'000
2020
£'000
197
197
The provision for property dilapidation covers the estimated future costs required to meet obligations under property leases
to redecorate and repair property.
19. Share capital
Ordinary shares of 1p each
Issued, called up and fully paid:
Number
Nominal value
2021
2020
16,028,579
£160,286
15,979,979
£159,800
During the year 48,600 1p ordinary shares were issued as a result of the exercise by employees of share options:
Number
Option price
Increase in Increase in share capital
Increase in Increase in share premium
28,600
20,000
48,600
13.5p
11.0p
£286
£200
£486
£3,575
£2,000
£5,575
Triad Group Plc Annual Report and Accounts 2021
| 57
Notes to the financial statements for the year ended 31 March 2021
20. Share-based payments
At 31 March 2021, 739,000 options granted under employee share option schemes remain outstanding:
Date option granted
23 September 2011
18 September 2014
9 March 2018
Number
129,000
75,000
535,000
Exercise price
Period options exercisable
13.5p
11.0p
53.5p
23 September 2014 to 23 September 2021
18 September 2017 to 18 September 2024
1 April 2021 to 9 March 2028
Under the terms of the scheme, options vest after a period of three years continued employment and are subject to the
following performance conditions:
For options granted on 9 March 2018: 100% of the shares granted under an option will vest if the Company’s share price at
31 March 2021 has increased by 30% or more from the share price as at the date of grant. 50% of shares granted under an
option will vest if the Company’s share price at 31 March 2021 has increased by 15% from the share price as at the date of
grant. Between these upper and lower thresholds, awards vest on a straight-line basis.
For all other options: In at least one financial year after the date of grant, the Company shall have achieved a positive basic
earnings per share (subject to adjustment to exclude identified exceptional items), as reported in its audited annual accounts.
Options have been valued using the Black-Scholes option-pricing model. No performance conditions were included in the
fair value calculations.
No options were granted during the year (2020: nil).
The total expense recognised in the year is £37,000 (2020: £28,000).
A reconciliation of option movements over the year to 31 March 2021 is shown below:
2021
2020
Number
of options
Number of
options
Weighted
average
exercise
price
Pence
Outstanding at start of year
817,600
40.3
1,028,600
Granted
Exercised
Forfeited
Outstanding at end of year
Exercisable at end of year
–
(48,600)
(30,000)
739,000
739,000
–
12.5
38.0
42.2
42.2
–
(11,000)
(200,000)
817,600
262,600
Weighted
average
exercise
price
Pence
37.7
–
13.5
27.4
40.3
12.5
There were 48,600 options exercised during the year. The above figures include options held by Directors which are set out
in the Directors’ remuneration report on page 22.
The weighted average share price at the date of exercise for share options exercised during the period was 75.6p (2020:
43.0p). The options outstanding as at 31 March 2021 had an exercise price of 11.0p, 13.5p or 53.5p and a weighted average
remaining contractual life of 5.4 years (2020: 6.2 years).
21. Related party transactions
The Group and Company rents one of its offices under a lease expiring in 2028, with a break clause in 2023. The current
annual rent of £215,000 was fixed, by independent valuation, at the last rent review in 2008. J C Rigg, a Director, has notified
the Board that he has a 50% beneficial interest in this contract. The balance owed at the year-end was £nil (2020: £nil).
58
| Triad Group Plc Annual Report and Accounts 2021
Five year record
For accounting periods commencing after 1 April 2018 the accounting treatment changed due to the introduction of IFRS 9
and IFRS 15. For the accounting period commencing 1 April 2019 further changes were made due to the introduction of IFRS
16. Therefore the accounting policies over the period detailed below will vary and be inconsistent.
Consolidated income statement
Years ended 31 March
Revenue
Gross profit
Profit/(Loss) before tax
Tax credit/(charge)
Profit/(Loss) after tax
Retained profit/(loss) for the financial year
Basic earnings/(loss) per share (pence)
Balance sheet
As at 31 March
Non-current assets
Current assets
Current liabilities
Non-current liabilities
Net assets
Share capital
Share premium account
Capital redemption reserve
Retained earnings
Equity shareholders’ funds
2021
£’000
17,815
3,810
644
41
685
685
4.28
2021
£’000
921
7,540
2020
£’000
19,354
2,854
(602)
(159)
(761)
(761)
(4.76)
2020
£’000
1,236
6,581
2019
£’000
22,713
4,376
1,017
(132)
885
885
5.60
2019
£’000
411
7,937
2018
£’000
27,819
4,724
1,662
(38)
1,624
1,624
10.45
2018
£’000
463
7,736
(2,555)
(2,399)
(2,483)
(2,997)
(623)
5,283
160
666
104
4,353
5,283
(863)
4,555
160
660
104
3,631
4,555
(99)
5,766
160
659
104
4,843
5,766
(77)
5,125
156
619
104
4,246
5,125
2017
£’000
30,912
5,000
1,521
13
1,534
1,534
10.08
2017
£’000
503
7,299
(4,118)
(45)
3,639
155
605
104
2,775
3,639
Triad Group Plc Annual Report and Accounts 2021
| 59
Shareholders’ information and financial calendar
Share register
Equiniti maintain the register of members of the Company. If you have
any questions about your personal holding of the Company’s shares,
please contact:
Equiniti
Aspect House
Spencer Road
Lancing
West Sussex
BN99 6DA
Telephone: 0371 384 2486
If you change your name or address or if the details on the envelope
enclosing the report, including your postcode, are incorrect or
incomplete, please notify the registrar in writing.
Shareholders’ enquiries
If you have an enquiry about the Group’s business, or about something
affecting you as a shareholder (other than queries that are dealt with
by the registrar) you should contact the Company Secretary, by letter
or telephone at the Company’s registered office.
Company Secretary and registered office:
James McDonald
Triad Group Plc
Weyside Park
Catteshall Lane
Godalming
Surrey
GU7 1XE
Telephone: 01908 278450
Email:
investors@triad.co.uk
Website:
www.triad.co.uk
Financial calendar
Annual General Meeting
The date of the AGM is to be confirmed. The Board are considering the
impact of Covid-19 on AGM arrangements and will publish the AGM notice
at the appropriate time.
Financial year ended 31 March 2022: expected announcement of results
Half-year
Full-year
November 2021
June 2022
60
| Triad Group Plc Annual Report and Accounts 2021
Corporate information
Executive Directors
John Rigg, Chairman
Adrian Leer, Managing Director
Tim Eckes, Client Services Director
James McDonald, Finance Director
Non-executive Directors
Alistair Fulton
Chris Duckworth
Charlotte Rigg
Secretary and registered office
James McDonald
Triad Group Plc
Weyside Park
Catteshall Lane
Godalming
Surrey
GU7 1XE
Telephone:
01908 278450
Email:
investors@triad.co.uk
Website:
www.triad.co.uk
Country of incorporation and domicile of
parent company
United Kingdom
Legal form
Public limited company
Company number
2285049
Registered Auditor
BDO LLP
55 Baker Street
London
W1U 7EU
Brokers
Arden Partners plc
125 Old Broad Street
London
EC2N 1AR
Solicitors
Freeths
Davy Avenue
Knowlhill
Milton Keynes
MK5 8HJ
Bankers
Lloyds Bank plc
City Office
11–15 Monument Street
London
EC3V 9JA
Registrars
Equiniti
Aspect House
Spencer Road
Lancing
West Sussex
BN99 6DA
Triad Group Plc Annual Report and Accounts 2021
| 61
Godalming office:
Huxley House
Weyside Park
Catteshall Lane
Godalming
Surrey GU7 1XE
Milton Keynes office:
Building 3 Caldecotte Lake Business Park
Caldecotte Lake Drive
Milton Keynes MK7 8LF
01908 278450
www.triad.co.uk