Trigg Mining Limited Annual Report 2022

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FY2022 Annual Report · Trigg Mining Limited

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2022

Annual Report
For the year ended
December 2022

Strategic Report

Group at a Glance

Non-Executive Chair's statement

Chief Executive's review

Chief Financial Officer's review

Aims and Ambition

Principal Risks and Uncertainties

Stakeholder Engagement

ESG Considerations

36 Corporate Governance

The Board

Directors’ Report

Corporate Governance Report

Financial Statements

Independent Auditor's Report

Consolidated Financial Statements & Notes

Independent Auditor's Report: Company

Company Financial Statements & Notes

102 Additional Information

102

Notice of AGM

Annual report for the year ended December 2022

Strategic Report
Group at a glance

Too much work disappears.

This isn’t a big secret, but it does seem careless.

Our approach is different.

Everything we do is designed to get to work that makes the difference Clients

are looking for, whatever their ambition.

We call it Work That Counts™.

So we collaborate because it does good, not because it looks good.

(That means we listen, before we talk).

We provide everything our Agencies need to give their Clients an advantage with

services and innovations under one roof.

We delve deep for insights that are all the stronger for not leaping off the page.

We eschew safety first, because that kind of work is always the first to be ignored.

We create and share innovation not as a means to impress, but for the benefit

of our Clients.

And we stay close to our Clients, regardless of distance and circumstance.

Our approach has helped us become the kind of long term creative partner that

consistently delivers real, sustainable growth, and we’re delighted to say that

our Clients seem happy to have us around.

That counts, big time.

USA

Germany

China

Malaysia

Singapore

Vietnam

A collective of Agencies that cover all touchpoints and
disciplines supported by centrally developed capabilities and
incremental services to widen and deepen Client relationships.

Over

1,100

people

Over

Agencies

locations

Continents

Annual report for the year ended December 2022

Building lasting relationships

Our Agencies pride themselves on building strong, productive partnerships with Clients.

That’s why so many brands have stayed with them for years – or even decades. As well as

strong track records in retention, we’re also welcoming exciting new Clients. Across the year,

our Agency acquisitions brought in some well-known and loved household names.

Client retention

Proportion of revenue earned from long-standing Clients.

47%+

5 years or more

29%

10 years or more

19%

20 years or more

Annual report for the year ended December 2022

The MISSION

Our Agencies

TO be the preferred creative partner for real business growth BY delivering Work that CountsTM

Our Agencies are home to a rich and varied mix of talented thinkers and doers.

All highly skilled in delivering hugely successful campaigns across every platform.

T E C H N O LO GY
& M O B I LI T Y

H E A LT H
& W E LLN E S S

B U S I N E S S &
C O R P O R AT E

C O N S U M E R
& LI F E S T Y LE

S P O R T S &
E N T E R TA I N M E N T

M I S S I O N ADVAN TAGE

M I S S I O N C O M M ER C IAL

Bringing brands to life in the real
world, through meaningful brand
building and experiences.

Delivering strategic marketing
for leading technology and
automobile brands.

A brand-building pioneer,
operating from Devon, Bristol
and Asia.

Creators of world-class live
experiences for over 30 years.

Growing customer engagement
through audience and
brand interaction.

A global commercial,
communications and content
Agency specialising in Formula 1
and leading high-performance sports.

A psychological insights and
behavioural solutions consultancy.

A full service creative powerhouse
with four UK offices.

A creative business that works hand
in hand with brands and the next
generation to build the future better.

A leading integrated sports, fitness and
entertainment marketing Agency.

An industrial internet of things
provider specialising in real-time
asset intelligence.

A social media Agency dedicated
to delivering results and pushing
boundaries through a 'no-fluff'
approach to social media marketing.

Providing market access support
to pharma and medical brands.

An innovative specialist medical
communications Agency.

Customer relationships built
on psychological insight.

Creating effective promotions and
new revenue streams through
brand partnerships.

An ambitious, creative and
commercially-minded PR Agency.

Award-winning integrated creative
Agency in three locations. We make
believers of your brand.

The UK’s leading integrated property
marketing Agency.

Annual report for the year ended December 2022

Our People

We are over 1,100 dedicated people, in 28 different locations, reaching across

three continents. However, we share our primary goal: producing Work That Counts™

for each Client. Whatever their ambitions.

Our approach to our people is focused on the 8 areas set out below, with several

of these also forming key parts of our ESG strategy which you can read more

about in this report. Achieving sustainable progress in these ways is important

to us. We’re proud of the steps we’ve taken, and will continue to take, together.

What our People Say…
“Our team is great – everyone
is so supportive and nurturing,
always willing to help and teach
each other. I’ve learnt a lot
really quickly, and have built up
confidence in my abilities. I love
having a job where I do not do
the same thing day in, day out.”

Tash, Bray Leino

Growing Together

Diversity & Inclusion

Community Action

At MISSION, we are committed to
creating a respectful and inclusive
environment; one where our people
can be themselves. We also believe
in the power of personal growth; so,
we listen, learn and support them in
developing their skills and achieving
their goals.

We’re passionate about attracting,
cultivating and growing with the
best talent from all backgrounds.
To achieve this, we work closely
with trusted diversity partners
and more.

We’re an international Group,
but we believe strongly in local
action. As such, all our UK Agencies
actively support local charities
and communities in their towns –
from fundraising and volunteering
to pro-bono work, putting our
communications skills to good use.

New Talent

To foster fresh talent, our Agencies
open their doors to local schools,
colleges and universities; offering
internships and an Apprenticeship
programme.

Taking Care of You

Flexible for All

We believe that life, and being
happy, is more than the job you do.
To best support our people with the
ups and downs of life, we have
devised our Employee Assistance
Programme to help with financial,
family, health and wellbeing issues.

People are at their best when their
home life doesn’t suffer. That’s why
we offer over 150 different flexible
working patterns across the Group.
Plus, parental return to work
schemes and a supportive approach
when our People need time out for
life’s big moments.

Health & Wellbeing

Socials

Our Agencies take a proactive
approach to health and wellbeing,
with free mental health support and
educational life balance activities
overseen by trained mental health
first aiders.

“All work and no play” is a thing
of the past. Therefore, each Agency
maintains a busy social scene,
with everything from dining events,
beer fridge Fridays, summer sports
days, picnics and end-of-year parties.

Annual report for the year ended December 2022

What Drives Us

Not values set in stone, but a living

commitment to make a difference every day.

A Culture of Collaboration

At MISSION, we don’t talk about having a set of values.
Instead, we live them. Working together, exchanging
ideas and doing our best at every opportunity to elevate
our Clients and each other, while supporting the
communities and environment around our Agencies.

A Shared Commitment

We also don’t force a code of values on our Agencies.
They’re all independently minded (that’s what we
liked about them in the first place) and they all have
their own values and personalities. But what we
do share is an entrepreneurial mindset, a passion
for positive sustainable growth and a commitment
to Work That Counts™. Together, we aim to make
a difference in everything we do.

Our Purpose

“We look for solutions where others see problems.

We are connected by the ambition to deliver

real impact for our Clients, People and

Communities. We celebrate, value and respect

diversity, treating others as we wish to be

treated ourselves. What we do matters,

and it needs to make a positive difference.”

Making a Positive Change

We believe MISSION should make a positive impact
on the world, always.

The Way We Treat The World Around Us Counts

At MISSION, we want every interaction we have with
people, communities and the wider environment to make
a positive difference, always.

Ultimately, what we do needs to matter, and it needs
to support positive change. That is absolute.

ESG in Action

In pursuit of our ambition to become the UK’s leading,
most respected Agency Group, we need to do just that –
lead. And committing to positive change requires
real action.

This is never truer than when applied to our environmental,
social and governance responsibilities. That’s why,
at MISSION, we’ve set a series of goals spanning our
environmental impact, social inclusion and diversity.

Annual report for the year ended December 2022

“Joining The MISSION Group
is an exciting prospect. The Group
has some terrific talent and great
potential, and I look forward
to working with them to deliver
growth for both our Clients and
the Group" Mark Lund, Deputy Chair

MISSION welcomes
new Deputy Chair
Mark Lund OBE

We are proud to announce that

Mark Lund has joined the Board

as a Non-Executive Director and

Deputy Chair. Recognised widely

as an industry leader, Mark has

a real reputation for delivering

serious success and growth.

With over 25 years leading and founding successful
companies, he joins MISSION to support further
innovation and growth.

Mark was President of McCann Worldgroup UK
and Europe from 2014-2022, leading a 5,000+
strong organisation across 45 countries. Before
this, he co-founded two independent advertising
businesses, one of which, Delaney Lund Knox Warren,
became a top 10 UK agency (Mullen Lowe).

Mark has also been Chairman of the Advertising
Association and served on the councils of both
ISBA and the IPA, as well as Chair of the Advertising
Association's Media Smart and Children's Panel.
He still sits on the Advertising Association council.

MISSION acquires
youth focussed
creative Agency Livity

Based in Brixton, with over 20 years

experience Livity is the market leader

in its space.

Livity works with leading brands to help them
understand youth culture and enable them to engage
with the next generation. Blue-chip Clients include Nike,
Google, Media Smart, Footlocker, YouTube, Speedo and
NSPCC Childline. The acquisition enhances our brand,
strategy, creative and content capabilities, underpinning
the Gen Z marketing offering across the Group.

Livity also provides a new route to next generation
talent for MISSION. The Agency champions early-stage
careers through its own network and by running talent
programmes across the creative industries.

“This acquisition is testament
to our continued strategy
of focussing on opportunities
that further enhance our compelling
infrastructure. Our Clients are
acutely aware of the growing
influence of Gen Z and how they
can successfully engage with
a youth audience in the most
meaningful way.”

John Quarrey, Group CEO of krow

“I am incredibly proud of the journey
Livity has been on. We have spent
20 years innovating in culture and
driving positive change for the next
generation. The MISSION Group’s
focus on creativity, innovation,
entrepreneurialism and purpose
makes it a natural fit for Livity.”

Alex Goat, Chief Executive Officer of Livity

Annual report for the year ended December 2022

MISSION acquires Influence Sports & Media
and Populate Social

The MISSION Group continues its investment in sports marketing
and social media. Our leading entertainment, sports, lifestyle
and marketing Agency Mongoose, recently acquired Influence
Sports & Media and Populate Social.

“Over the last 10 years we have
continued to build our presence
in sport, delivering best-in-class
services for leading global brands,
teams and properties. We are
delighted to be joining the newly
formed Mongoose Group to drive
international opportunities.”

Alistair Watkins,
Founder & CEO of Influence Sports & Media

The two Agencies retain their individual brands
and identities, whilst forming an integral part of the
newly created Mongoose Group, joining Mongoose
Sports & Entertainment and ALIVE Brand Experience.

London-based Influence Sports & Media, with a strong
presence in the US, is a specialist sports marketing
agency offering strategic consultancy, commercial
sales, partnership activation, PR & communications and
content creation. The team has a wealth of experience
and long-standing relationships in motor sport, sailing
and pro-cycling bringing expertise from the highest
echelons of world sport to the Group – including the
flagship events of Formula 1, the America’s Cup and
the Tour de France.

Cardiff-based Populate has a 20-strong team
of social media experts that pride themselves
on forward-thinking, full transparency and
data-driven results. The Agency has a strong track
record of pushing boundaries with paid media
campaigns, organic social media management,
social strategy, content creation, messenger bots
and TikTok/social content packages. Clients include
England Rugby, Live Nation and Paris Fashion Week.

“After seven years of growing
Populate, I am delighted to
have found the right partner
in Mongoose Group to help elevate
our offering and bring our social
media expertise to a global roster
of brands and rights holders.”

Dan Simmons, Founder of Populate Social

“Populate will transform our social delivery
as part of our integrated Client campaigns.
Influence Sports & Media will lead on all
projects ‘on track and water’ and Mongoose
Sports & Entertainment will continue driving
on ball sports, outdoor sports, venues
and charities.”

Chris O’Donoghue, CEO at Mongoose Group

“In challenging times, MISSION
continues to make good progress
against our strategic priorities.
Our latest investment is yet another
example of our commitment to
developing our capabilities and client
service offering, ensuring we are
well placed for long-term growth.”

James Clifton, Chief Executive Officer of MISSION Group plc

Annual report for the year ended December 2022

MISSION ADVANTAGE is a portfolio of strategic services built to drive positive

MISSION COMMERCIAL is an array of cost-effective, shared provisions designed

change and dramatically extend the scale and scope of our offer.

to deliver scalable, best-in-class support services and expertise to our Agencies.

Comprising teams of experts in HR, global digital production, data science and

research, regional expansion and promotion – our teams are positioned around

the globe and ready to mobilise in support of our Agencies.

MISSION ADVANTAGE complements the strategic and creative strength of our

Agencies allowing them to offer wider, deeper, and highly credible services

in support of their own unique propositions and aspirations.

ADVANTAGE is built as the platform for change, operating on a cost only basis

to ensure the profitability, relationships and opportunity remain with our Agencies.

MISSION COMMERCIAL incorporates teams across Facilities management

& administration, IT & systems, Accounting services, Financial reporting,

Governance & compliance and Commercial partnership. Our people are experts

in their fields and are driven to provide value, safety and security across the Group.

MISSION COMMERCIAL supports the wider Group endeavour, ensuring that

every Agency team is dedicated to delivering Work that CountsTM. New Agency

additions to the Group are able to quickly focus directly on growth and

opportunity whilst handing off their own support services safely and securely.

By simplifying and sharing these services and creating scalable centres

of excellence the Group is well positioned to delivery sustainable margin

growth as revenues rise.

Facilities
management
& administration

IT & systems

Commercial
partnership

Financial
reporting
& treasury

Accounting
services

Governance
& compliance

Annual report for the year ended December 2022

Strategic Report
Non-Executive Chair statement

In 2022 MISSION showcased its ability to adapt to the
well documented macro-economic uncertainties, and
to inflationary and wage pressures. This combination
of challenges created real pressures, some out of our
control, but the Group adapted quickly and continued
to make progress against our strategic goals.

In a resilient performance, MISSION delivered 10% year
on year revenue improvement with all business segments
achieving growth, and in line with industry norms.
Importantly we continued to build, refine and restructure
the core areas of our business. Investments were made
in growth sectors using a combination of ‘buy and build’,
expanding our capabilities in data and analytics,
creative and customer experience, and performance
media. All this activity ensured MISSION remains
competitive and best positioned to meet the evolving
business needs of our clients.

The operational improvements made in 2021 and 2022
underpinned headline operating profit growth of 8.0%
to £8.7m (2021: £8.0m). A focus on cost management
in response to significant cost and wage inflationary
pressures resulted in an improvement in headline PBT
to £7.8m (2021: £7.5m). Operating profit of £1.6m was
significantly down (2021: £7.3m), reflecting a series
of one-off adjustments relating to the strategic review
of non-core operations, including the Group’s Asian
operations and Industrial IoT solutions business Pathfindr.

Following the launch of our ESG strategy, Making
a Positive Change, in 2020, we were clear that we
wanted to challenge ourselves with a series of ambitious
commitments to make a positive difference. Thanks
to the efforts of the entire Group, I’m very pleased
to be able to report good progress across a number
of key areas, outlined in our first ESG Report (see page 33).

Board

Outlook

The progress made in 2022 has ensured MISSION now has
the right platform in place to support the next phase of our
growth, delivering Work That CountsTM as the preferred
creative partner for real business growth. Our sharpened
strategic plan aims to deliver an operating income target
of c. £100m by 2025, with higher margin performance
across our areas of strength.

I would like to thank all of our colleagues across the
Group for their commitment to progressing our plans
for MISSION.

Julian Hanson-Smith
Non-Executive Chair
March 2023

We continued to restructure our Board. In September
2022 Mark Lund joined MISSION as Non-Executive
Director and Deputy Chair. Mark has spent over
25 years leading and founding marketing and advertising
organisations, and his experience is already proving
invaluable as we implement our growth plan.

Executive Director Sue Mullen retired from the Board
in January 2023 but remains with the Group as Chair
of Story. Andy Nash, a Non-Executive Director, retired
from the Board in September.

On behalf of the Group, I would like to thank both
Sue and Andy for their contribution during their
respective tenures.

Dividend

In line with our progressive dividend policy, and MISSION’s
sustained progress, the Board is recommending a final
dividend of 1.67 pence per share for shareholders on
the register as at 14 July 2023. Combined with the half
year dividend, this brings the total dividend for the year
to 2.50p, representing a 4% increase on the prior year
(2021: 2.40 pence per share).

47%

of Group revenue was
generated from Clients
of 5 years or more.

Total dividend for 2022

on the total dividend
declared in 2021.

“Investments were made
in growth sectors using
a combination of ‘buy
and build’.”

Annual report for the year ended December 2022

Strategic Report
Chief Executive’s review

MISSION delivered a resilient performance in 2022. Whilst
the macro-economic environment has continued to pose
challenges for all businesses and constrained growth across
the majority of sectors and markets, we have remained focused
on our strategic growth plans, building on the strong momentum
achieved in the previous years.

In these challenging times, brands expect total
commitment and smart thinking from their
Agencies, continuing to prioritise investment in
creative partnerships that can drive real business
growth. Despite the headwinds of 2022, MISSION
has demonstrated the strong entrepreneurial
culture of this business. The investments we have
made in recent years across the Group to expand
our capabilities and services, strengthen our teams
and improve our operational practices and
processes, have stood the Group in strong stead
to capitalise on the opportunities available to us.

This has underpinned a robust revenue
performance, with operating income of £79.8m
now broadly recovered to pre pandemic levels
(2019: £81.0m). Despite the significant inflationary
pressures, careful management of costs has seen
the Group protect margin and deliver year on year
headline operating profit growth. Whilst profit at
a reported level was impacted by the exceptional
costs primarily associated with the strategic
restructuring of our Asian operations and Pathfindr
business, these decisions ensure these areas of our
business are best positioned for long term growth.

“We have remained focused
on our strategic growth
plans, building on the strong
momentum achieved in the
previous years.”

“All business
segments achieved
growth over the
course of the year.”

operating income

£79.8M

10% growth on 2021

Whilst our creative Agency krow experienced a more
challenging year than originally forecast, February
saw the successful launch of krow-x, which better
embeds CX insight into their creative process.

We also continued to see good trading recovery
from our Agencies who were most exposed to sectors
impacted by the pandemic including property-specialist
ThinkBDW.

In May 2022, we took the decision to merge Story and
Chapter to create Story Group, uniting these two Agencies
with similar Client relationships and cultures to offer better
scale, geographic reach and broader sector experience,
enhancing their collective reputation. We saw a significant
uplift in new business enquiries generated by the launch
of the enhanced profile over the course of H2.

Client retention has continued to be strong throughout
the year. 47% of our Clients have been retained by the
Group for more than 5 years and 29% for more than
10 years. It is particularly pleasing to see that the
growing breadth of capabilities and services which
we are able to offer our Clients through the MISSION
family has played a critical role in growing some
of these Client relationships with our expanding remits
for Phihong Tech, Macmillan Cancer and Simplyhealth
being important examples of this.

New Business acquisition gathered momentum over
the course of the year with new client wins including
Westmill Foods, BAM Clothing, McCarthy Stone and
Croda. The strength of the MISSION Group capability
was integral to our appointment to new Client
Taiwanese electrical group Phihong, now working with
three of our Agencies as part of a new Group mandate.

Work That CountsTM – evolving our business model
to better support our vision

'Work That Counts,' articulates the Group’s vision
to be the preferred creative partner for real business
growth, with a clear mission to ensure that everything
we do is designed to deliver work that makes the difference
our Clients are looking for, whatever their ambition.

Building on the momentum achieved across the business
in recent years, we are now evolving our strategy
to better support this vision, with a focus on driving
profitable growth through the expansion of an Agency
Driven business model. This will see us move away from an
‘Agency-First’ approach to leverage our Client specialisms
across Sports & Entertainment, Health & Wellness,
Business & Corporate, Consumer & Lifestyle and
Technology and Mobility, enhancing margin through
the centralised support we can offer through MISSION
Advantage, our portfolio of specialist services which
underpin the strategic and creative strengths of our
Agencies and MISSION Commercial which provides
centralised operations, HR and business support.

Performance and Progress

All business segments achieved growth over the course of the
year – testament to the underlying resilience of our business
model. Our exposure to higher growth B2B sectors such
as Technology and Healthcare continues to underpin this
performance with strong year on year growth once again
from April Six (Technology) and Solaris Health (Healthcare).

New Client wins throughout the year include:

Annual report for the year ended December 2022

Strategic Report
Chief Executive’s review

The entrepreneurial nature of the MISSION approach
means that our Agencies are empowered to respond
quickly to the trends they are seeing in their markets,
drawing on the Group’s central offering and driving
cross-Agency collaboration to bring new capabilities and
services to address evolving Client need and demand.

Over the course of the year this included a collaboration
between Speed Communications and Bray Leino to launch
a new consultancy ‘Anything But Grey’- specifically
to cater for businesses and brands seeking to engage
a 50 plus audience, with subsequent new Client wins
including Saga Media. In response to market trends
ThinkBDW also launched Think Digital, a proposition
that will better virtually showcase housing development
projects to customers.

As previously announced, in the second half of the year
we took the decision to fundamentally restructure our Asian
operations, where performance has been impacted by the
extended effect of COVID-19 on the region. Our operations
are now streamlined and centred on Singapore & Malaysia.
In order to support international expansion in new regions,
we have created MISSION Hubs to sit as part of MISSION
Advantage which will offer a more structured approach
to the Group’s international expansion going forward.

We have also reviewed the progress and potential of
Pathfindr, the Group's Industrial IoT solutions business.
As announced in our trading update on the 12 January
2023, given the supply chain and wider market challenges
experienced we now expect growth will be slower in the
near term. We remain hopeful about the long term growth
of Pathfindr but have fully impaired the value of our
investment to date and deferred further investment in the
short term with the team remaining focussed on realising
the current live opportunities.

Investing for growth

Over the course of 2022 we have continued to make
significant progress in building the Group’s capabilities
and service offering and have seen the benefit of the
investments made both in the current and prior year.

These have included:

During 2022

• The acquisition of Livity, a youth focussed creative

consultancy in February, for a consideration
of £0.1m satisfied in cash. Livity works with leading
brands to help them understand youth culture and
enable them to engage with the next generation with
purpose. The acquisition enhances MISSION's brand,
strategy, creative and content capabilities,
underpinning the Generation Z marketing offering
across the Group.

• The acquisition of Influence Sports & Media ("Influence")

in December for an initial consideration of £1.5m.
Influence works with sponsors and brands, rights
holders, investors and industry Clients in both the UK
and US to deliver marketing communications strategies,
commercial programs, and actionable market
intelligence. The acquisition strengthens and scales
MISSION’s social media and marketing capabilities
across the sports and entertainment markets.

• The acquisition of social media Agency Populate

in October further strengthening MISSION’s social
media capabilities.

Post Year End

Outlook

Trading in 2023 has begun well and in line with the
Board’s expectations. Whilst revenue generation
is customarily weighted towards the second half
of the year we have been pleased with the positive
new business momentum experienced to date.

The investments made throughout the business position
us well to capitalise on the growth opportunities that
continue to present themselves. Our teams are motivated
and energised for the year ahead and we look forward
to reporting further progress as the year continues.

James Clifton
Chief Executive
March 2023

“Our teams are motivated
and energised for the year
ahead and we look forward
to reporting further progress
as the year continues.”

James Clifton, Group Chief Executive

• The acquisition of Mezzo Labs, a global data science
and digital analytics consultancy in February. Mezzo
Labs is a leading provider of innovative data services
with over 16-years' experience in data strategy and
architecture, web analytics, CX analytics, marketing
automation, insights generation, data science,
Conversion Rate Optimisation (CRO) and personalisation.
The acquisition enhances the Group’s capabilities
within the data science and digital analytics space.

• The launch of integrated growth digital Agency

Turbine in March, which specialises in earned, owned
and paid media. The launch is a direct response
of the growing demand for an effective solution to the
challenges of multi-channel digital marketing, offering
a fresh approach to digital growth marketing that
focuses on generating the results that really matter
to commercial success.

Making Positive Change

Following the successful launch of our inaugural
Environmental, Social and Governance (ESG) manifesto
'Making Positive Change' in 2020, I am delighted that
the year has seen us deliver our first ever ESG Report,
demonstrating the progress we have made against
our commitments. We believe the impact MISSION
makes on the world should be positive, always. That
our interaction with our People, Clients, Communities,
and the wider environment needs to make a difference.
Ultimately, what we do needs to matter, and it needs
to support positive change.

Particular highlights in the report have included the
progress we have made in reducing our carbon impact
as a Group with a reduction of 40% in 2019-2021 and
our commitment to improving Group Diversity and
Inclusion through our partnership with Creative Access,
the social enterprise working Group. Full details
of our progress can be found in our ESG Report which
is available on our website within the Culture section
under Making A Positive Change.

Annual report for the year ended December 2022

Strategic Report
Chief Financial Officer’s review

2022 is characterised by strong revenue growth together with
investment, both in our people and in new, margin-enhancing
capabilities. Alongside this the Group has taken a cautious
view of non-core operations as it renews its strategic focus
to deliver sustainable revenue & margin growth through
Work That CountsTM.

Operating income growth in 2022 of 10% along with
the maintenance of headline operating margins at 11%
(2021: 11%), ensured good headline operating profit growth
of 8% to £8.7m (2021: £8.0m). A review of non-core
operations primarily in relation to Asia and Pathfindr
resulted in one-off charges of £5.7m (as described more
fully below and set out in Note 3) and this, combined with
increased borrowing costs led to a reported profit before
tax of £0.7m (2021: £6.8m).

Billings and revenue

Turnover (billings) was 19% higher than the previous year,
at £182.7m (2021: £153.3m), but since billings include
pass-through costs (e.g. TV companies’ charges for
buying airtime), the Board does not consider turnover
to be a key performance measure for its Agencies.
Instead, the Board views operating income (turnover
less third-party costs) as a more meaningful measure
of activity levels. Taken as a whole, the Group’s operating
income (referred to as “revenue”) for the year increased
by 10% to £79.8m (2021: £72.5m), with growth delivered
across all reported business segments.

Of this £7.3m growth in revenue, £4.5m (6%) was organic,
reflecting the continued growth across a number
of MISSION Agencies. April Six, our specialist technology
and mobility Agency that grew strongly during the
pandemic continued to out-perform and the Group also
benefited from strong performances in our Think BDW,
Solaris Health and Spark Agencies.

The remaining £2.8m of growth came in part from
the benefit of a full year of Soul trading (acquired
October 2021) and supplemented by the revenue impact
of new MISSION agencies Livity (acquired February
2022) and Influence (acquired December 2022).

£m

Headline

Reported

2022

2021 Movement 2022

2021 Movement

Operating income
('revenue')

79.8

72.5

10%

79.8

72.5

10%

Operating profit

8.7

8.0

1.6

7.3

-78%

Operating margin % 10.9% 11.1%

-0.2pts

2.0% 10.1%

-7.9pts

Profit before tax

Earnings per share

7.8

6.7

7.5

6.5

0.7

0.0

6.8

5.9

-90%

-100%

Tax rate

21%

22%

-1pt

95%

21%

74pts

The majority of our businesses have now recovered well
if not fully from the disruption of COVID-19. Both our
Asian operation, Bray Leino Splash, and Asset Tracking
IOT investment Pathfindr were significantly affected by
the continued prevalence of the pandemic in China and
the region. Each business has fundamentally reviewed
and restructured its operations in light of this and the
Board has taken a view on the subsequent impact this
alongside the short-medium term trading environment
has had on the goodwill and other asset values carried
by these companies.

One of the differentiating features of MISSION is the
longevity and loyalty of its Client base. We believe this
is due to the dynamic and Agency-driven culture which
ensures Clients receive a boutique level of Client service
but supported by the resources of a multi-national group.

“One of the
differentiating
features of MISSION
is the longevity
and loyalty of its
Client base.”

Profit and margins

The Directors measure and report the Group’s performance
primarily by reference to headline results in order to avoid
the distortions created by the one-off events and non-cash
accounting adjustments relating to acquisitions that are
detailed above. Headline results are therefore calculated
before acquisition adjustments, exceptional items and
losses from new ventures as described below and set out
in Note 3.

Whilst Headline Operating profits grew, reported operating
profit fell sharply this year, from £7.3m in 2021 to £1.6m
in 2022, a decrease of £5.7m.

Reported profit before tax decreased by £6.0m, from £6.7m
to £0.7m whilst reported profit after tax reduced by £5.3m
from £5.3m to £0.0m.

Adjustments to reported profits, detailed further
in Note 3, totalled £7.0m (2021: £0.7m) a significant
increase on previous years. This was primarily due
to one-off adjustments relating to the strategic review
of two non-core operations. The first is the fundamental
restructure and future valuation of Bray Leino Splash,
resulting in a combined £2.4m charge. The second
relates to the impairment of Pathfindr, resulting
in a £2.9m charge.

In addition to this the Group invested £0.8 in new ventures
(2021: £0.4m) most notably the Livity youth-marketing
offer as well as early-stage foundation of performance
marketing and data science capabilities to support future
strategic endeavour.

Acquisition-related costs of £0.6m compared to £0.2m
profit in 2021. The 2022 charge consists primarily of the
amortisation of intangibles recognised on acquisitions
of £0.5m (2021: £0.4m) as well as professional fees
in support of the acquisitions such as Influence made
in the year. The 2021 profit was driven by a one-off
£0.8m reduction in movement of fair value consideration
(2022: £0.3m).

The Board engaged in a significant restructuring and
resizing in 2021. The resultant one-off costs associated
with this restructure last year totalled £0.5m.

Adjusting for these items delivers a headline operating
profit of £8.7m showing good, 8% growth on 2021 (£8.0m).

The headline operating expenditure base increased
in the year by 10% (from £64.5m in 2021 to £71.2m
in 2022) with the Group determined to continue to invest
in its most important asset, its people and their wellbeing,
even as macro-economic pressures heightened. In spite
of - or as a result of - this investment the Group was able
to maintain operating margins in line with 2021 at 11%.

Interest charges of £1.0m increased significantly on 2021
(£0.7m) driven primarily by considerable interest rate
increases globally as central banks sought to curb
inflationary pressures.

The resultant headline profit before tax for 2022 was £7.8m,
a reasonable improvement on 2021 at £7.5m.

Taxation

The headline tax rate held steady at 21.1% (2021: 22.0%).
On a reported basis in 2022 the impact of the large
one-off non-deductible expenditure primarily in relation
to impairment of goodwill resulted in a tax charge
of £0.7m on a reported profit before tax of £0.7m, a rate
of 95.2% compared to the more normal level of 21.2%
reported in 2021.

The tax rate is generally expected to be consistently
higher than the statutory rate (of 19.0%, unchanged
from 2021) since the amortisation of acquisition-related
intangibles is not deductible for tax purposes and tax
rates on our US operations are substantially higher that
the UK corporation tax rate.

Annual report for the year ended December 2022

Strategic Report
Chief Financial Officer’s review

Earnings Per Share

Dividend

Chart showing change in total Acquisition Obligations over time

After tax, the reported profit for the year was £0.0m
(2021: £5.3m profit) and EPS was 0.0p pence
(2021: 6.0 pence). On a diluted basis, EPS was
0.0 pence (2021: 5.9 pence).

However, after adjustments, Headline EPS was
6.8 pence (2021: 6.6 pence) and, on a diluted basis,
was 6.7 pence (2021: 6.5 pence).

The Board adopts a progressive dividend policy, aiming to
grow dividends each year in line with earnings but always
balancing the desire to reward shareholders via dividends
with the need to fund the Group’s growth ambitions and
maintain a strong balance sheet and healthy distributable
reserves (2022: £36.0m, 2021: £38.7m).

A dividend of 0.83 pence per share was paid in December
2022. The Board has proposed a resolution for a final
dividend of 1.67 pence per share in its AGM Notice,
bringing the total for the year to 2.50 pence per share.

This represents a 4% increase on the total dividend
declared in 2021 (2.40 pence per share).

Chart showing the Dividend Per Share progression over time (pence)

3.0

2.5

2.0

1.5

1.0

0.5

0.0

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

Balance sheet

In common with other marketing communications groups
the main features of our balance sheet are the goodwill
and other intangible assets resulting from acquisitions
made over the years and the debt taken on in connection
with those acquisitions.

The level of intangible assets relating to acquisitions
and internal investments increased by £0.8m in the year.
This movement being primarily a function of the
acquisition of Influence in December netting off against
the impairment of the Bray Leino Splash goodwill balance
and Pathfindr intangible asset impairment. The level
of ‘total debt’ (combined net bank debt and acquisition
obligations) increased by £1.9m.

The Board undertakes an annual assessment of the
value of all goodwill, explained further in Note 11.
At 31 December 2022 the Board concluded that, with
the exception of a £2.0m write down of the Bray Leino
Splash goodwill as described above, no impairment
in the carrying value was required.

The Group’s acquisition obligations at the end of 2022
were £4.1m (2021: £3.3m), to be satisfied by
a mix of shares and cash. All of this is dependent
on post-acquisition earn-out profits. £1.4m is expected
to fall due for payment in cash within 12 months and
a further £0.1m in cash in the subsequent 12 months.
The Directors believe that the strength of the Group’s
balance sheet can comfortably accommodate these
obligations alongside the Group’s commitments
to capital expenditure (expected to run at similar levels
to recent years) and dividend payments.

Consolidated Net Current Assets closed at £7.7m
(2021 £10.3m). This was in part the result of the increase
in acquisition obligations noted above and in part
an increase in trade creditors at the year end of £3.6m
in comparison to 2021.

14.0

12.0

10.0

8.0

6.0

4.0

2.0

0.0

2012

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

Acquisition Obligations have increased in 2022 but are still well below the levels of recent years.

At the end of the year the Group’s net bank debt stood at £11.4m (2021: £10.3m). On an adjusted basis (pre IFRS16)
the leverage ratio of net bank debt to headline EBITDA was x1.2 at 31 December 2022 (2021: x1.2). The Group’s adjusted
ratio of total debt, including remaining acquisition obligations, to EBITDA at 31 December 2022 was x1.6 (2021: x1.5).

Chart tracking Debt Leverage Ratios over time

Bank leverage

Total leverage

5.0

4.5

4.0

3.5

3.0

2.5

2.0

1.5

1.0

0.5

0.0

2013

2014

2015

2016

2017

2018

2019

2020

2021

2022

Annual report for the year ended December 2022

Strategic Report
Chief Financial Officer’s review

Cash flow

The closing net bank debt position for 2022 was £11.4m.
This represents an increase in net debt of £1.1m on the
2021 year-end net bank debt of £10.3m.

Headline operating profit of £8.7m (2021: £8.0m)
converted into £6.8m (2021: £1.7m) of ‘free cash flow’
(defined as net cash inflow from operating activities
less tangible and intangible capital expenditure).

Bank loans increased by £1.0m and this, coupled with
the free cash flow provided funding for new acquisitions
amounting to £1.9m (2021: £0.7m), the settlement of
contingent obligations relating to the profits generated
by previous acquisitions totalling £0.8m (2021: £6.7m)
and dividends of £2.2m (2021: £2.1m). The working capital
movement is defined as the aggregate movement
in receivables, stock and payables and was reported
as an inflow of £1.1m (2021: £4.8m outflow).

Analysis of the movement in Net Debt in 2022

In regard to working capital days, total debtor days
decreased, work in progress days decreased very
slightly and creditors days increased a small amount.
Overall, the Group’s total working capital days
of 9.6 represents a significant improvement upon
the 2021 equivalent (15.0 days).

“Headline operating
profit of £8.7m
converted into £6.8m
of ‘free cash flow'.”

Giles Lee, Group Chief Financial Officer

10.3

9.7

1.9

0.5

0.8

11.4

2.9

1.6

0.8

2.2

12.0

10.0

8.0

6.0

4.0

2.0

0.0

2021 Operating

cashflow

Dividends
Paid

Prior
Acq'ns

New
Acq'ns

Capex

Lease
payments

Own
shares
purchased

Start-ups
etc

2022

Chart showing the cash-generative nature of the business
Operating Cashflow/Headline Operating Profit as a 3 year MAT

160%

140%

120%

100%

80%

60%

40%

20%

Going concern

The Directors have considered the financial projections
and cash flow projections for the Group alongside the
availability of committed bank facilities of £20m (expiring
5 April 2025), the option to increase the facility by £5m,
an overdraft facility of £3.0m, and the headroom afforded

against Total Debt Leverage and Bank Debt Leverage
covenant tests for the coming 12 months. This leads
the Directors to become satisfied that, taking account
of reasonably possible changes in trading performance,
it is appropriate to adopt the going concern basis
in preparing the financial statements.

Achieve organic revenue
growth of at least

per year

Grow headline profit
before tax by

10%

year-on-year

Increase headline
operating profit margins to

14%

Key Performance Indicators

Outlook

We entered the year expecting 2023 to be another year
of growth, albeit at a time of increasing global macro-
economic and political uncertainty.

The year has started well and prospects for organic
growth are good. We also expect to make additional
margin improvements in spite of the cost pressures
impacting our sector and we anticipate reaping the
benefits of our strategic review, focus on the core
operation and investments made both to our talent base
and in new offerings and capabilities. Furthermore and
as a result of the actions taken in 2022 this growth is well
set to be cash efficient.

Giles Lee
Group Chief Financial Officer
28 March 2023

KPIs are designed to monitor the Group’s revenue and profit
growth, within a safe capital structure. Whilst COVID-19
has interrupted the Group’s consistent track record
of growth, the Board has reviewed and reconfirmed
the Group’s KPI targets as being appropriate for
a post-pandemic environment.

The targets, along with the outcome for 2022
are as follows:

• Achieve organic revenue growth of at least 5% per year

[delivered + 6%];

• Increase headline operating profit margins to 14%

[delivered 11%];

• Grow headline profit before tax by 10% year-on-year

[delivered 4%]; and

• Maintain the ratio of net bank debt to EBITDA* at or below
x1.5 [delivered x1.2] and the ratio of total debt (including
both bank debt and deferred acquisition consideration)
to EBITDA at or below x2.0 [delivered x1.6].

*EBITDA is headline operating profit before depreciation
and amortisation charges.

At the individual Agency level, the Group’s financial KPIs
comprise revenue and controllable profitability measures,
predominantly based on the achievement of the annual
budget. More detailed KPIs are applied within individual
Agencies. In addition to financial KPIs, the Board
periodically monitors the length of Client relationships,
the forward visibility of revenue and the retention
of key staff.

2015

2016

2017

2018

2019

2020

2021

2022

Annual report for the year ended December 2022

Strategic Report
Aims and Ambition

Strategic Report
Principal Risks and Uncertainties

Our goal remains simple: to develop MISSION into the UK’s
leading, most respected Agency group. In a complex and
ever-changing marketing environment, we are constantly
evolving to help our Clients navigate through their challenges
and opportunities. With a wealth of specialisms and skills,
as well as impartial advice, we invest and adapt to deliver
the right talents in the most effective ways. With operations
in the UK, Europe, Asia and the US, we’re committed to helping
our Clients grow and succeed. Fundamental to our continued
success is our ability to provide a rewarding, challenging and
fun working environment for our staff.

Principal Risks and Uncertainties

The Group’s principal operating risks and uncertainties
are set out below. The management of risk is the
responsibility of the Board, assisted where appropriate
by the Audit & Risk and Remuneration Committees,
as described further in the Corporate Governance Report.
The Directors have carried out an assessment of the
principal risks facing the Group, including those that
would threaten its business model, future performance,
solvency and liquidity.

We aim to reward MISSION’s shareholders both through
capital growth and dividends. Our focus is first and
foremost on organic growth, and in deploying the
Group’s capital we always aim to support existing
management teams who have demonstrated an ability
to grow their businesses and to achieve consistently high
margins. We constantly strive to enhance our offer with
acquisitions that add new disciplines or improved
services to our Agencies, and we also target new
high-growth market sectors, along with service
or technology opportunities, which meet strict return
on investment criteria. As well as acquisitions, we also
consider launching new businesses that may require
more time to become established, but which will have
a smaller investment cost and lower risk profile.
We continue to develop our international footprint
in response to Client demand and where we see strong
opportunities to leverage our well-established UK
strengths elsewhere in the world. We look to maintain
a balance of equity and debt financing to give
shareholders the advantages of financial leverage
but without placing the Group at financial risk.

Adverse Economic Conditions

Loss of Key People

The risk with the greatest potential impact on the Group’s
financial position is a widespread and dramatic economic
downturn, as seen by the impact of COVID-19 and the
crisis in the Ukraine as well as the longer term impact
these crises have had on the labour market and inflation.
The effect is reduced revenues and tighter margins,
profitability and cash flows. The entrepreneurial culture
that runs through our Agencies means that, while we will
inevitably feel the impact of any economic downturn,
we adapt quickly to changed circumstances and also
seek out opportunities that inevitably emerge in times
of economic challenge.

Loss of Key Clients

The consequence of Client losses is the same as for
a general economic downturn, i.e. potential reduction
in revenue and profit, but to a lesser degree. Client losses
are, to some degree, to be expected. The risk here is that
Client losses are not replaced by new business and an
agency finds all or part of its offers difficult to sell.
The risk of Client loss is mitigated both by our continuous
new business activity and also by a constant focus by all
Agency CEOs on ensuring that the offers and services
we provide to current and prospective Clients are
relevant, effective and attractive.

In common with all service businesses, the Group
is reliant on the quality of its people. The risk is that an
Agency loses good, senior talent as a result of out-of-step
remuneration packages, lack of progression opportunities
or workplace environment and are unable to attract
replacements. Strenuous efforts are made to provide
a rewarding work environment and remuneration packages
to attract, retain and motivate our leadership teams.

Two measures of our success are that our staff retention
statistics are higher than the industry average and that
the vast majority of the core management of our
acquired businesses remain in place today. The system
of financial rewards is reviewed regularly by the
Remuneration Committee and revised where appropriate.
An example of this is the innovative Growth Share
Scheme, designed to provide a powerful retention
incentive for our key business leaders. The Group
launched the second iteration of this scheme in 2021.
The first scheme, launched in 2017 proved to be a success
and can be measured by the fact that, when the scheme
matured in April 2020, we had retained all but one of the
17 individuals.

Annual report for the year ended December 2022

Strategic Report
Stakeholder Engagement

Strategic Report
Environmental, Social and Governance (“ESG”) considerations

The Board takes its Companies Act Section 172 duty to promote
the success of the Group very seriously and considers the Group’s
various stakeholders when making decisions

Principal decisions

Engagement with stakeholders

In 2022 the following principal decisions were taken
by the Board: 1) the acquisition of Influence Sports
Limited (‘Influence’), 2) the fundamental restructure
of the Group’s operations in SE Asia and 3) pausing
the strategic investment in the Pathfindr operation.

Rationale

The Board has signalled its intent to invest in businesses
that both have the potential to drive cross-sell into
high-margin, contemporary offers and have attractive
Client lists that can be introduced to existing MISSION
services. The acquisition of Influence delivered on this
intent with the agency’s Sports Marketing offer adding
immediate scale and strength to the Group’s social media
and marketing capabilities across the high-growth sports
and entertainment markets.

The impact of COVID-19 in China and to a lesser extent
in SE Asia has caused the Group’s trading in the region
to recover far more slowly than has been the case in the
US and UK. With the outlook for recovery in the region
at best unclear the Group has taken the hard decision
to fundamentally restructure its operations there.
In a similar vein persistent supply-chain interruptions
stemming from COVID-19 related issues in China have
hampered progress on the Pathfindr initiative resulting
in delays to Client testing and progress.

The rationale for restructuring each operation is to ensure
that Group resources can be directed to strategic
investment priorities more closely associated with
the core business when they arise.

Prior to the acquisition of Influence, James Clifton and
Giles Lee presented the strategic and financial business
case to the Bank, Board and to Agency CEOs, assimilated
the advice and experience received from these parties
and confirmed their full support before proceeding with
the transaction. Care was also taken to ensure that
key Influence employees were fully supportive of the
transaction prior to completion. The Board also confirmed
that the acquisition would help the Group deliver against
its environmental targets.

Prior to the decision to restructure the Group’s Asia
operations James Clifton oversaw a full strategic review
of the options available. This process was driven by
business leaders in the region and supported by Agency
CEOs in the UK. The results of this were presented to the
Board where the final decision was made.

A full strategic review of the Pathfindr business was shared
with the Board where once again the final decision was made.

In all three cases above care is taken to ensure that the
views of Clients and employees were considered wherever
it was appropriate to do so.

MISSION’s long established communication processes
remained in place throughout 2022 to ensure effective
interaction with all key stakeholders. Examples of this
include the regular investor roadshows led by James
Clifton and Giles Lee to accompany the full year and
interim results, and also internal ‘Town Hall’ Q&A sessions
and Senior Team meetings conducted by James Clifton
and Julian Hanson-Smith to discuss major
MISSION-led initiatives.

Making a Positive Change

In our ambition to become the UK’s leading, most
respected Agency Group, we need to do just that – lead.
This is never truer than when it comes to our corporate,
social and environmental responsibility. We believe the
impact MISSION makes on the world should be positive,
always. That our interaction with our People, Clients,
Communities, and the wider environment needs to make
a difference. Ultimately, what we do needs to matter, and
it needs to support positive change.

Environment

As a collective of creative Agencies providing a range
of marketing, advertising and consultative services, our
direct and indirect impact on the environment is low. But we
can always do better. We aim to reduce our environmental
impact in the resources and energy we use, how and when
we travel, the suppliers we select and how we work to create
healthy operating models.

We also have a responsibility to consider not just how we
operate but also to share insight and best practice across
our Client base to move the brands and businesses we work
with forward. Reaching millions of people through our
600 plus international Client base, that’s a lot of chances
to make a big difference every day.

Our People are a key part of our environmental journey
driving behaviour change in our Agencies to reduce carbon
impact, whether through reducing waste and energy
consumption, travelling more responsibly or selecting
suppliers aligned to our ambitions. Supported through
training and partnerships with the likes of Green Element,
AdNetZero and Greenshoot we are accelerating change
wherever we can.

Ultimately, our aim is to be sustainably profitable and do
good in the world.

Our goals:

• Reduce total emissions by 21% for 2024 and

42% for 2029 across Scope 1, 2 and 3 in line with
Science-Based Targets* with an aim to achieve
net zero emissions by 2050

• Commit to the Business Ambition for 1.5°

• Build Environmental Management Systems and action
plans across all Agencies to address carbon emission
hotspots and drive emissions reduction

• Work towards ISO 14001 certification by 2023

for majority of Agencies

We have been measuring greenhouse gas (GHG) emissions
since 2019 in order to understand, prioritise areas of focus
and take action to reduce our impact and achieve our
goals. Agencies have captured information covering
all activities including our offices, travel, purchases and
working from home. 2022 has seen a slight increase
in emissions (3%) compared to 2021 but we have
still achieved a 40% overall decrease compared
to pre pandemic levels in 2019.

In 2022, the highest sources of emissions were purchased
services, IT hardware, business travel by air, commuting,
energy consumption and company fleet vehicles. This has
not changed significantly since 2021, though a small rise
in emissions related to commuting has occurred with
people returning to the office more regularly. We have
also added three new Agencies to our Group – Influence
Sports & Media, Populate Social and Livity. This has
added locations and seen our headcount grow by over
50 people in 2022. A focus on reporting quality has also
meant that accuracy has improved, with several Agencies
moving from information based on spend to consumption.

* Science Based Targets are a set of goals developed
by a business to provide it with a clear route to reduce
greenhouse gas emissions. An emissions reduction target
is defined as ‘science based’ if it is developed in line with
the scale of reductions required to keep global warming
below 1.5’C from pre-industrial levels.

Social

Diversity & Inclusion:

It’s the people in our business that make it what it is.
We’re powered by talented teams who value and respect
difference. We’re committed to making sure our people feel
valued whatever their background, that they belong, and
can be their authentic self at work.

Over the past few years, we’ve partnered with Creative
Access – a social enterprise working to ensure creative
businesses truly reflect society. We’ve introduced a Group
Diversity & Inclusion Manifesto, appointed a diversity
champion at Board level, put our senior leaders through
inclusive leadership training, and all MISSION Group
employees have had D&I training. In 2022, we launched
MISSION Communities. These community groups are
helping create safe spaces for people to talk, providing
advice to leaders on D&I policies, and insight into different
key areas such as ethnicity, sexuality, age, neurodiversity
and faith.

These initiatives are helping to evolve our understanding
and build an inclusive culture. But what matters is how
our people feel. And so, this year we asked them through
our Employee Engagement Survey. Our overall Inclusion
score was 74% positive across the MISSION Group.
85% of people answered positively about being their
authentic self at work (2% above the industry average),
and 79% felt they belonged at the company (also 2% above
the industry average).

Community:

With 28 locations and over 1,100 people across the globe
it’s important to our team and to us that we connect and
support our local communities. We are committed to
helping them thrive, boosting the key foundations stones
that make them healthy – arts, education, conservation,
health & wellbeing and the creation of opportunities for
the next generation.

Annual report for the year ended December 2022

Strategic Report
Environmental, Social and Governance (“ESG”) considerations

Governance

Unlike many other groups, our Agencies, which have
mainly come into the Group via acquisition, retain their
original personnel, cultures and business practices,
with MISSION providing the support infrastructure and
economies of scale of a multi-national group. This sees
a highly personalised and people-centric culture which
has led to an expanding and loyal Client base and strong
talent retention and attraction. We believe the role of the
Board is not to direct these Agencies but ensure they are
supported and collaborate to deliver the best work to
help our Clients succeed.

The MISSION Board and non-executive group have a good
balance of sector and financial experience alongside
Agency CEOs who provide a ‘front seat’ view of Agency
challenges, opportunities and the marketplace as a whole.

The Board is responsible for the long–term success and
growth of the Group, embedding effective controls which
enable risks such as cyber security; data protection;
supply chain fragility; market resilience; economic
volatility and political instability to be assessed and
managed. Held to account by independent Audit & Risk
and Remuneration committees, the Board is focused
on ensuring that our People, Agencies and the Group are
consistently safeguarded.

We believe that corporate governance is not the poor
cousin of the ESG triplet but an integral part of the Group.
It is key to how we interact with our investors, employees,
suppliers and other stakeholders and is focused on
monitoring progress against our wider ESG commitments
making sure we are driving forward positive change.

Our very existence as a marketing group is dependent
upon our ability to foster strong and mutually beneficial
relationships with all Stakeholders. Alongside sustainable
growth, we see Client happiness, referral ratings and staff
engagement levels as indicators of our collective success
and are consistently measured by the Board.

Good governance is about transparency, trust and
accountability. We believe all stakeholders need to be
part of our journey, to share in the highs and lows; so we
are committed to being open and transparent, always,
on our successes but also areas for growth.

• Goal: improve stakeholder advocacy across the board

as shown through Client happiness levels, referral
ratings and staff engagement levels.

• Goal: manage risk effectively ensuring the interests

of our People, Agencies, Group and Investors
are protected.

Our impact is widespread working with 27 national and
local charity and community groups from RNLI and
Macmillan to North Devon Hospice. We go beyond just
donating and put our skills to good use with pro bono
work that really makes a difference to the brand
awareness of these important causes.

And we have continued to invest in the next generation,
opening our doors to local schools, colleges, and
universities as well as providing mentoring, work
experience and paid internship opportunities.

Family:

We recognise the importance of family. 85% of our
people scored us positively in supporting flexible working
arrangements, and 86% said they were supported
to arrange time out of work when needed.

We want our people to have the best home lives whilst
pursuing their career. That’s why we have over 140 different
flexible working arrangements across the MISSION Group

Health & wellbeing:

We create an environment where people talk about the
things that matter to their health & wellbeing. It is these
conversations that change the way we work to create
the best environments for our people. We’ve combined
free mental health support and educational life balance
activities which are overseen by over 40 mental health
first aiders. We want to change the way we all think and
act about workplace mental health.

Our goals and progress to date:

• Goal: 16% of employees from under-represented ethnic

groups by the end of 2023 and 18% by 2025.

Progress: At the end of 2022, 10.6% of our employees

were from under-represented ethnic groups.

• Goal: 10% of employees with disabilities by the end

of 2023 and 12% by 2025.

Progress: Currently 3.1% of employees have declared

a disability across the Group. We are improving
reporting alongside new partnerships in 2023.

• Goal: To have 30 apprentices by 2023 and 50 by 2025.

Progress: In 2022, we had 21 apprenticeships across
the Group which is up 6 from 2021. New schemes are
boosting these numbers in 2023.

• Goal: 17% of employees from under-represented age
groups (below 20 and above 50) by 2023 and 20%
by 2025.

Progress: In 2022, 15% of our employees were from

under-represented age groups.

• Goal: An equal gender split between male and female

employees whilst recognising those who identify
as neither or both

Progress: Of our 1057 employees, 51% identify

as female and 49% identify as male.

We look for solutions where others see

problems. We are connected by the

ambition to deliver real impact for

our Clients, People, Communities

and the wider environment.

We celebrate, value and respect

diversity, treating others as we wish

to be treated ourselves. What we do

matters, and it needs to make

a positive difference.

Annual report for the year ended December 2022

Corporate Governance
The Board

The following Directors represent the committee
responsible for corporate governance compliance:

Each of our Executive Directors has had a long career
in marketing communications:

Julian Hanson-Smith
Non-Executive Chair and

Senior Independent Director

Julian is an entrepreneur and PE investor with significant
experience in marketing and consulting services. In 1986
Julian co-founded FTI Consulting, one of Europe’s largest
business communications consultancies, and following
its sale in 1999 became COO of Lighthouse Global Network.
In 2001 he joined US-based PE firm Lake Capital, before
co-founding Iceni Capital in 2007, investing in UK-based
business services companies. He is Chair of Apella
Advisors. He joined the Board in October 2015 and
was appointed Non-Executive Chair in October 2021.

Giles Lee
Group Chief Financial Officer

Giles joined Bray Leino in 2005 as Group Finance Director
following his successful role in transforming Merrydown
plc from its fundamental financial restructure in 1998
to its acquisition in 2005. Giles was appointed Executive
Chair of Bray Leino in 2013. He was appointed to the
Board in March 2013 and became Commercial Director
for MISSION in July 2018. As well as providing commercial
support to the Group’s Agencies, Giles has overseen many
acquisitions and strategic investments and was the driving
force behind the creation of MISSION Shared Services.
Giles was appointed Group CFO in April 2021.

Mark Lund
Non-Executive Deputy Chair

Marketing both as entrepreneur and corporate
executive. He co-founded independent Top 10 agency
DLKW (now Mullen Lowe), was President of McCann
UK and Europe and ran the UK Government’s marketing
centre, the COI. Mark is Non-Executive Chair of Smart
Energy GB and of Asbof which funds the UK’s self-
regulation system for Advertising. Mark was appointed
to the Board in October 2022 and Chairs the
Audit & Risk Committee.

Eliza Filby
Non-Executive Director

Eliza joined MISSION in January 2022 as a Non-Executive
Director. A writer, speaker, consultant and podcast host,
she is a highly respected expert in ‘Generational
Intelligence’. She has been helping companies and
services understand generational shifts within politics,
society and the workplace, working with organisations
from VICE Media and Warner Brothers to the UK’s
Ministry of Defence and Royal Household. As well
as speaking at the EU’s Human Rights Forum, the
Financial Times CEO Forum and the UK’s House of Lord’s
Select Committee, she has authored books and written
for the Financial Times, Times and City AM. Eliza was
appointed to the Board in January 2021 and Chairs the
Remuneration Committee.

James Clifton
Group Chief Executive

Fiona Shepherd
Chief Operating Officer

James started out Client-side before working for various
agencies in the UK and internationally, within Omnicom
and WPP. He created balloon dog in 2008, having led
an MBO of Fox Murphy. Balloon dog was acquired
by MISSION and James was appointed to the Board
in October 2012. He became CEO of bigdog following
the merger of balloon dog with fellow MISSION Agency
Big Communications, founded Pathfindr, the Group’s
IIoT Asset Tracking business, and chaired the Group’s
Integrated Agencies before being appointed Group
Chief Executive in April 2019.

Fiona is Chief Executive of April Six and has worked
in the technology industry for over 20 years, holding
both Client and agency positions, with some of the
world’s largest technology brands. Fiona was a founder
of April Six and has been instrumental in expanding
the Agency from its UK origins to its current position
as a well-respected global technology and mobility
Agency with offices across the world. Fiona joined
the Board in April 2010 and has taken on responsibility
for MISSION Advantage in 2022. Fiona was appointed
COO in March 2023.

Dylan Bogg
Chief Creative Officer

Dylan is Chief Creative Officer of krow and oversees
creative output for the Agency. He had built a successful
business by the age of 24 and this was used as
the bedrock for the launch of Big Communications
in 1996 which was acquired by MISSION in 2006.
Dylan is a multi-award-winning creative and was
appointed to the Board in April 2010. He also chairs
the Group-wide Creative Directors’ Forum. Dylan
was appointed CCO in March 2023.

Annual report for the year ended December 2022

Corporate Governance
Directors' Report – for the year ended 31 December 2022

The Directors have pleasure in presenting their report and the
financial statements of The MISSION Group plc (“MISSION”)
for the year ended 31 December 2022. The Directors provide
a separate Corporate Governance Report, which forms part
of this Report of the Directors.

Results and Dividends

Risks and Uncertainties

The Consolidated Income Statement shows the results
for the year. The Directors approved a dividend
of 0.83 pence per share, paid in December 2022,
and have included a proposal for a final dividend
of 1.67 pence per share, payable on 28th July 2023,
in the Notice of Annual General Meeting.

The Strategic Report sets out the Group’s principal
operating risks and uncertainties. As a communications
Agency group, the main financial risks that arise from
day-to-day activities are credit and currency risk.
Further details on the Group’s capital and financial risk
management are set out in Note 26.

Directors

The following Directors held office during the year:

Dylan Bogg

James Clifton

Dr Eliza Filby

Julian Hanson-Smith

Giles Lee

Mark Lund – appointed 1 October 2022

Sue Mullen – resigned 12 January 2023

Andy Nash – resigned 30 September 2022

Fiona Shepherd

Directors’ Interests in Shares and Options

The interests of the Directors and their families in the shares of the Company were as follows:
Number of ordinary shares of 10p each.

Dylan Bogg

James Clifton

Dr Eliza Filby

Julian Hanson-Smith

Giles Lee

Mark Lund

Fiona Shepherd

31 December 2021

31 December 2022

1,648,185

532,095

85,803

1,070,753

1,309,932

1,648,185

555,834

85,803

1,071,066

1,309,932

Growth Share Scheme

A Growth Share Scheme was implemented on 25 June 2021,
giving participants the opportunity to subscribe for Ordinary
B shares in The MISSION Marketing Holdings Limited
(the “growth shares”) at a nominal value. These growth
shares can, subject to continued employment, be
exchanged for an equivalent number of MISSION Ordinary
Shares if MISSION’s share price were to equal or exceed
150p for at least 15 days during the period from subscription
up to 60 days from the announcement of the Group’s
financial results for the year ending 31 December 2023;
if not, they would have no value.

At the time the scheme was introduced, achieving
the target share price of 150p would have resulted
in dilution to existing shareholders of less than 4%
but would also have represented an increase in market
capitalisation of over 105%. A total of 27 individuals
were invited to participate in the scheme, of which
5 are board members.

Details of growth shares held by the Directors are as follows:

Number of Ordinary B shares in The MISSION Marketing Holdings Limited of 0.01p each.

Dylan Bogg

James Clifton

Julian Hanson-Smith

Giles Lee

Fiona Shepherd

31 December 2021

Awarded in year

31 December 2022

72,727

240,000

100,000

240,000

72,727

240,000

100,000

240,000

Annual report for the year ended December 2022

Corporate Governance
The Board

Share options

There were no unexercised options over shares held by Directors:

Substantial Shareholdings

Share Capital

Other than the Directors’ interests disclosed above,
as at 28 March 2023, notification had been received
of the following interests in 3% or more of the issued
share capital of the Company:

The issued share capital of the Company at the date
of this report is 91,015,897 Ordinary shares. The total
number of voting rights in the Company is 91,015,897.

Directors

Number
of shares

Octopus Investments Nominees Ltd

8,883,916

9.8

Herald Investment Management Ltd

5,778,239

6.3

Directors’ Indemnity Insurance

The Company purchases insurance to cover its Directors
and Officers against costs they may incur in defending
themselves in legal proceedings instigated against
them as a direct result of duties carried out on behalf
of the Company.

David Morgan

4,813,053

5.3

Directors’ Responsibilities

BGF Investment Management Limited

4,713,501

5.2

Close Asset Management Ltd

4,631,647

5.1

Objectif Investissement Microcaps FCP

4,230,477

4.6

Stellar Asset Management Ltd

2,736,320

3.0

The Directors are responsible for preparing the Annual
Report and the financial statements in accordance with
applicable law and regulations. Company law requires
the Directors to prepare financial statements for each
financial year. Under that law the Directors have
prepared the Group financial statements in accordance
with International Financial Reporting Standards (IFRSs)
as adopted by the United Kingdom and the Parent
Company financial statements in accordance with
United Kingdom Generally Accepted Accounting Practice
(United Kingdom Accounting Standards comprising
Financial Reporting Standard FRS 102, the Financial
Reporting Standard applicable in the UK and Republic
of Ireland and applicable law). Under company law the
Directors must not approve the financial statements

Disclosure of Information to Auditors

So far as the Directors are aware, there is no relevant audit
information of which the Group’s auditors are unaware.
Each of the Directors has taken all steps that they ought
to have taken as Directors in order to make themselves
aware of any relevant audit information and to establish
that the Group’s auditors are aware of that information.

Events Since the End of the Financial Year

There were no material post balance sheet events.

Stakeholder Engagement

The Company’s Section 172 statement and other details
of stakeholder and employee engagement are set out
in the Stakeholder Engagement report.

Streamlined Energy and Carbon Reporting (“SECR”)

SECR is a sustainability regulation that came into force
on 1 April 2019. It requires organisations to publicly report
on carbon emissions and energy use, including UK energy
use, associated greenhouse gas emissions, and an
appropriate intensity ratio. SECR is applicable to all
quoted companies and large UK incorporated unquoted
companies with at least 250 employees or annual
turnover greater than £36m and annual balance sheet
total greater than £18m (two criteria or more must apply).
Accordingly, the 2022 information given below is for
The MISSION Group plc and Bray Leino Limited.

unless they are satisfied that they give a true and fair
view of affairs of the Group and the Company and of the
profit or loss of the Group for that period. 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 applicable IFRSs as adopted by the
UK have been followed by the Group and FRS 102
by the Parent Company, subject to any material
departures disclosed and explained in the financial
statements, and

• Prepare the financial statements on the going concern
basis unless it is inappropriate to presume that the
Company will continue in business.

The Directors are responsible for keeping adequate
accounting records that are sufficient to show and explain
the Company’s and the Group’s transactions and disclose
with reasonable accuracy at any time the financial
position of the Company and the Group and to enable
them to ensure that the financial statements comply with
the Companies Act 2006. They are also responsible for
safeguarding the assets of the Company and the Group
and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities.

The Directors are responsible for the maintenance and
integrity of the corporate and financial information
included on the Group’s website. Legislation in the
United Kingdom governing the preparation and
dissemination of financial statements may differ
from legislation in other jurisdictions.

The Directors consider the annual report and accounts,
taken as a whole, is fair, balanced and understandable
and provides the information necessary for shareholders
to assess the Group and Company’s position, performance,
business model and strategy.

Auditors

PKF Francis Clark have indicated their willingness to
continue in office and, in accordance with the provisions
of the Companies Act 2006, it is proposed that they be
re-appointed auditors to the Company for the ensuing year.

Annual report for the year ended December 2022

Corporate Governance
Directors' Report - for the year ended 31 December 2022

Corporate Governance
Corporate Governance Report

Energy consumption: (kWh’000s)

- Electricity

- Gas

- Transport fuel

- Fuel for electricity generation

2022

2021

253

207

125

176

214

Total energy consumption

585

460

Emissions (tCO2e)

Scope 1

Emissions from combustion of gas
in buildings

Emissions from combustion of fuel
for transport purposes

Scope 2

Emissions from purchased electricity
(location-based method*)

Scope 1 & 2

45.2

45.4

1.4

0.4

Total Scope 1+2 emissions

95.4

83.2

Scope 3

Emissions from business travel in rental
cars or employee vehicles where company
is responsible for purchasing the fuel

Emissions from upstream transport and
distribution losses and excavation and
transport of fuels

30.9

21.4

32.2

19.9

Total emissions for mandatory reporting

158.5

124.5

Intensity (tCO2e / FTE)

Full Time Equivalent staff numbers

Intensity ratio: tCO2e / FTE

324

0.5

319

0.4

* location-based electricity (Scope 2) emissions use the
average grid fuel mix in the region or country where
the electricity was purchased and consumed.
For SECR, location based is mandatory.

The computations above have been calculated and
verified as accurate by Green Element Limited and
Compare Your Footprint Limited, UK and the
methodology used is in accordance with the GHG
Protocol Corporate Accounting and Reporting Standard
2014. Employees now work across 11 sites, therefore
energy consumption from an additional 7 office sites
was included compared to 2021.

We see SECR as a wonderful opportunity and not just
another compliance exercise. It gives us the chance
to assess our current emissions and find ways to reduce
them. In 2020 we calculated our carbon footprint for the
first time and certified Bray Leino as ISO 14001 compliant.
All MISSION companies are signed up to Sustainability
Solved (a coaching platform to enable organisations
to implement their own environmental management
systems) and additional MISSION companies have the
aim of achieving ISO 14001 compliance. We will continue
to comply with environmental legislation and to monitor
and measure our consumption data with a view
to reducing our intensity ratio.

The Group supports the aims of The Modern Slavery Act
2015 (“the Act”) and will never knowingly deal with any
organisation which is connected to slavery or human
trafficking. Given the nature of the services we provide
and our high standard of employment practices,
we consider that we are at low risk of exposure to slavery
and human trafficking. We are not aware of any areas
of our operations and supply chain likely to lead
to a breach of the Act.

Annual General Meeting

A notice convening the Annual General Meeting to be
held on Tuesday 20 June 2023 at 12 noon is enclosed
with this report.

On behalf of the Board

Giles Lee

Group Chief Financial Officer

28 March 2023.

48.8

37.4

Slavery and Human Trafficking Statement

The Board of The MISSION Group plc (“MISSION”) is collectively
accountable to the Company’s shareholders for good corporate
governance, under Julian Hanson-Smith as Chair.
As an AIM-listed company, MISSION has chosen to apply the
Quoted Companies Alliance (“QCA”) Corporate Governance Code
for Small and Mid-Size Quoted Companies (“the QCA Code”).

MISSION is a collective of creative Agencies led by
entrepreneurs who encourage an independent spirit.
Our aims and ambitions are set out in the Strategic
Report. Unlike many other groups, our Agencies, which
have mainly come into the Group via acquisition, retain
their original leaders, cultures and business practices.
MISSION provides them with the support infrastructure
and economies of scale of a multi-national group.
We strongly believe that this results in a highly
personalised and Client-centric culture which in turn
leads to an expanding and loyal Client base. The role
of the Board in establishing good corporate governance
in the context of this strategy requires making sure not
only that individual Agencies are targeted, monitored
and supported but, equally importantly, that Agencies
cooperate and collaborate with each other to ensure
we are providing the best possible range of services
to help our Clients succeed. Indeed, it is this sense
of cooperation and collaboration which defines the
culture of MISSION and much of our time as a Board
of Directors is devoted to exploring how this collaboration
is optimised.

Board of Directors

The Board has a balance of sector, financial and public
markets skills and experience. Brief profiles of each
member of the Board are set out on pages 36 and 37.
Each of our Executive Directors has had a long career
in marketing communications, and brings strong
and up to date sector experience.

Our Group Chief Financial Officer and two independent
Non-Executive Directors provide industry, financial and
public market skills and experience and, together with
me, represent the committee responsible for corporate
governance compliance and ensuring that a strong
independent voice is present during Board discussions.

The roles of Chair and Chief Executive are separate,
with James Clifton, as Group Chief Executive, having
responsibility for implementing the Group’s strategy,
driving growth, building our brand and delivering
sustainable shareholder value.

Giles Lee was appointed Group Chief Financial Officer
in 2021 and has also in practice retained much of his
previous responsibilities as Group Commercial Director.
In accordance with the QCA Code recommendation, the
company secretary is not also an Executive Director, with
Michael Langford being appointed to the role. Michael is the
Group’s Financial Controller. He is a Chartered Accountant
with suitable training and has previously assisted the
Finance Director in company secretarial matters.

Our Non-Executive Directors are Mark Lund and Dr Eliza
Filby, both independent by virtue of having no executive
responsibilities within the Group. Both Mark and Eliza
bring a strong independent voice to Board discussions
but also with an insight into our sector.

Mark has enjoyed a long career in Advertising and
Marketing both as entrepreneur and corporate executive.
He co-founded independent Top 10 agency DLKW (now
Mullen Lowe), was President of McCann UK and Europe
and ran the UK Government’s marketing centre, the COI.
Eliza is a writer, speaker, consultant and podcast host,
she is a highly respected expert in ‘Generational
Intelligence’. She has been helping companies and
services understand generational shifts within politics,
society and the workplace, working with organisations
from VICE Media and Warner Brothers to the UK’s
Ministry of Defence and Royal Household.

Annual report for the year ended December 2022

Corporate Governance
Directors' Report - for the year ended 31 December 2022

Formal evaluations of Board effectiveness are held on
a periodic basis. The most recent evaluation took place
during 2022, was conducted by the Chair, and involved
a combination of self-evaluation and one-to-one interviews
with individual Board members to seek objective feedback
on the balance of skills, behaviours and effectiveness
of the Board as a whole, the Chair and other Board
members. The next evaluation is due to take place during
2023. External counsel is sought when considering
best-practice review criteria.

The Directors are collectively responsible for the strategic
direction, investment decisions and effective control of the
Group. As part of its recurring business, the Board receives
a financial summary of the Group’s performance early
in the month, comparing revenue and profit for each
Agency with the prior year and budgets set at the
beginning of the year and any subsequent re-forecasts.
This summary is supplemented by written monthly reports
from the Group CEO and a report from the Group CFO
summarising the Group’s balance sheet and working
capital performance. Separate reports are received in
connection with non-recurring matters, including written
strategic and financial appraisals of potential acquisition
opportunities. The Board is satisfied that it receives
information of a quality and to a timetable that permits
it to discharge its duties.

All Directors are subject to election by Shareholders
at the first opportunity after their appointment and are
required to seek re-election every three years. The Board
has established three formal committees to deal with
specific aspects of the Group’s affairs.

Audit & Risk Committee

The Audit & Risk Committee consists of two Non-Executive
Directors, with Mark Lund as Chair alongside me.
The Committee considers matters relating to the reporting
of results, financial controls and the cost and effectiveness
of the audit process. The terms of reference of the
Committee can be found in the Governance section
of our website. It aims to meet at least twice a year
with the Group’s external auditors in attendance.
Other Directors attend as required. The Committee
receives from the Group’s auditors and considers two
detailed reports: the Audit Planning Report which sets
out the auditors’ proposed audit approach, and the Audit
Completion Report, towards the conclusion of the audit
fieldwork, which highlights the main matters considered
and arising from the audit work.

The main meeting of the Committee each year reviews
the financial results and disclosures in the annual report.
This meeting is held shortly before the annual results
are published and considers in detail with the Group’s
auditors the principal areas of subjective judgement and
any other matters brought to the Committee’s attention
by the Group’s auditors. The main matters considered
each year are any indications of possible goodwill and
/or investment impairment, capitalisation of intangible
development costs and the application of the Group’s
revenue recognition policies.

The Committee is satisfied that the Group’s auditors,
PKF Francis Clark, have been objective and independent
of the Group. The Group’s auditors performed non-audit
services for the Group as outlined in Note 6. The nature
of this work was again predominantly corporate finance
advice and financial due diligence in relation to prospective
acquisitions and not related to areas of significant
judgement in the accounts. The work was not carried out
by the audit team, the value of this work was not significant
in relation to the size of the audit fee, the basis for charging
was based on hourly involvement and no fees were
contingent on outcome. As a consequence, the Committee
is satisfied that the auditors’ objectivity and independence
was not impaired by their non-audit services.

Remuneration Committee

As outlined in the Strategic Report, strong Client
relationships and quality of staff are key factors in the
success of MISSION, and strenuous efforts are made
to retain and motivate our leadership teams. The Board
maintains a policy of providing executive remuneration
packages that will attract, motivate and retain Directors
and senior executives of the calibre necessary to deliver
the Group’s growth strategy and to reward them
for enhancing shareholder value. The Remuneration
Committee consists of two independent Non-Executive
Directors, with Eliza Filby taking the role of Chair
in January 2022 alongside me. The Committee
determines the remuneration of the Executive Directors
and makes recommendations to the Board with regard
to remuneration policy and related matters.

Nomination Committee

The Nomination Committee consists of me, as the
Committee Chairman, and the two Non-Executive
Directors. The Committee is responsible for reviewing
and making proposals to the Board on the appointment
of Directors and meets as necessary. The terms of
reference of the Committee are available on request.
In 2022 the Committee considered the vacancy created
for a Senior Non-Executive Director and Chair of the
Audit & Risk Committee by the resignation of Andy Nash
and invited Mark Lund to join the Board on this basis.

Summary of Directors’ Attendance

Executive Directors are expected to make a full-time
commitment to the Group, whilst Non-Executive
Directors are generally expected to be available
to participate in person at Board meetings and meetings
of the Remuneration, Audit and Nomination Committees.

In addition, they are expected to be available to discuss
matters between these formal meetings. Where diary
clashes or Client commitments conflict with formal
meeting dates, the matters to be addressed during
meetings are discussed with the relevant Director both
before and after the relevant meeting. We estimate that
the time commitment required from our Non-Executive
Directors is roughly 3 days per month.

The Committee meets as and when required and its terms
of reference can be found in the Governance section
of our website. The remuneration and terms and
conditions of appointment of the Non-Executive Directors
are determined by the Board. No Director is involved
in setting his or her own remuneration.

The Committee reviews the components of each Executive
Director’s remuneration package annually. During the
year, these packages consisted of four elements:

• basic salary and benefits,

• performance related bonus linked to the delivery

of profit targets

• share-based incentives, and

• termination packages to outgoing Directors.

With regard to remuneration policy, the Committee
gives specific consideration each year to the nature
and quantum of incentive arrangements to ensure they
remain relevant and effective for the retention of key staff,
including not just Executive Directors but also senior staff
within the Group’s Agencies. This includes setting the profit
targets which trigger annual performance-related cash
bonuses and approving the allocation of incentives to
individuals. The Committee undertook a detailed review
of the Group’s incentives during 2018, implementing
various changes as a result and no further refinements
were considered necessary in 2022.

The Remuneration Committee approved the latest
Growth Share Scheme in June 2021.

The Committee reviews annually whether or not profit
targets have been met to trigger performance-related
bonuses to Directors and the senior management in
individual Agencies. This evaluation considers both the
Group’s financial performance and individual Agency
performance, and takes place alongside the finalisation
of the annual results. Details of Directors’ remuneration
are included in Note 7.

Annual report for the year ended December 2022

Corporate Governance
Directors' Report - for the year ended 31 December 2022

Board Meetings

Remuneration Committee

Audit Committee

Entitled
to attend

Attended

Entitled
to attend

Attended

Entitled
to attend

Attended

Dylan Bogg

James Clifton

Eliza Filby

Julian Hanson-Smith

Giles Lee

Mark Lund

Sue Mullen

Andy Nash

Fiona Shepherd

n/a

Shareholder Communication

We engage in a dialogue with our shareholders and
prospective shareholders via formal meetings and
informal telephone and email contact. In addition,
we provide comprehensive information to investors
on our website, including contact information and
answers to frequently asked questions.

Formal meetings with institutional fund managers and
wealth managers take place throughout the year but
are concentrated on the periods following our interim
and full year results announcements. We receive collated
feedback from these meetings via our NOMAD, Shore
Capital. In addition, I speak to representatives of our
larger institutional investors between these formal set
pieces to make sure the dialogue continues and that
we understand their expectations. Private investors
don’t have the benefit of regular formal meetings,
but we make sure we are available to meet shareholders
at our Annual General Meeting and we often continue
a dialogue with them via email. The results of proxy votes
cast at Annual General Meetings can be found in the
Investors section of our website.

James Clifton, Giles Lee and I are, between us, the first
point of contact for any queries raised by shareholders
but, should we fail to resolve any queries, the Senior
Independent Director, Mark Lund, is available to meet
shareholders. I am encouraged to note that, to date,
no such request has been received.

Corporate Culture

The Group has established a statement of corporate
values in order to establish clearly for all stakeholders
what we stand for and how we behave. These values are:
invested, accountable, connected, progressive and
human. However, culture is defined as the internal
expression of brand purpose. In the same document
we stated our brand purpose or Vision as “the preferred
creative partner for real business growth.” This was
supported by a summary of our personality: ”We are
a challenger brand. So we try harder. We look for
solutions where others see problems. We are connected
by the ambition to deliver amazing results for our Clients.

We are driven by the entrepreneurial spirit that runs
through our veins. We celebrate diversity and treat others
how we would wish to be treated ourselves.” This is the
culture to which we aspire.

The formal matters reserved for the Board include
certain key internal controls: the specific levels
of delegated authority and the segregation of duties;
the prior approval of all acquisitions; the review
of pertinent commercial, financial and other information
by the Board on a regular basis; the prior approval
of all significant strategic decisions; and maintaining
a formal strategy for business activities.

Assurance over risk management is obtained from
the establishment of management policies and controls,
regular review of individual Agency financial performance,
and the external audit process. The Board does not
consider it necessary to have a separate internal audit
function at the present time; the internal audit of internal
financial controls forms part of the responsibilities of the
Group’s finance function.

On behalf of the board

Julian Hanson-Smith
Chair

28 March 2023

Risk Management

Whilst the Directors are collectively responsible for
the effective control of the Group, the Audit & Risk
Committee has primary responsibility for the oversight
of risk. The principal risks and uncertainties facing the
Group are set out in more detail in the Strategic Report
and the Non-Executive Directors periodically consider
whether or not this remains up to date.

Clients and staff represent the key resources and
relationships on which our business relies. Primary
responsibility for maintaining strong Client relationships
and retaining key staff lies with the Agency CEOs and
this is monitored via written monthly reports and
interaction with the Group CEO. Their day to day
involvement with Clients provides the Board with strong
and up to date feedback from this vital stakeholder
group, including lessons to be learnt from unsuccessful
new business pitches. Periodically, a new service is
developed as a result of this feedback loop. It has also
been through Client feedback that we have embarked
on our international expansion – going where our
Clients want us to be.

Potential acquisitions and changes in incentive and
rewards systems, designed to motivate and retain key
staff, are considered by the full Board when it meets
in person, or via regular informal contact between meetings.

The Board is responsible for ensuring that the Group
maintains a system of internal financial controls.
The objective of the system is to safeguard Group
assets, ensure proper accounting records are
maintained and that the financial information used
within the business and for publication is timely and
reliable. Any such system can only provide reasonable,
but not absolute, assurance against material loss
or misstatement.

All day to day operational decisions are taken initially
by the Executive Directors, in accordance with the
Group’s strategy. The Executive Directors are also
responsible for initiating commercial transactions
and approving payments, save for those relating
to their own employment.

Annual report for the year ended December 2022

Financial Statements
Independent Auditor’s Report

Independent Auditor’s Report
to the Members of The MISSION Group plc

Opinion

The Group comprises the following trading companies:

We have audited the financial statements of The MISSION
Group plc (the “Group”) for the year ended 31 December
2022, which comprise the Consolidated Income Statement,
Consolidated Statement of Comprehensive Income,
the Consolidated Balance Sheet, the Consolidated Cash
Flow Statement, the Consolidated Statement of Changes
in Equity and the related notes including a summary
of significant accounting policies. The financial reporting
framework that has been applied in their preparation
is applicable law and International Financial Reporting
Standards (IFRSs) as adopted by the UK.

In our opinion, the financial statements:

• give a true and fair view of the state of the

Group’s affairs as at 31 December 2022 and
of the Group’s profit for the year then ended;

• have been properly prepared in accordance

with IFRSs as adopted by the UK; and

• have been prepared in accordance with the
requirements of the Companies Act 2006.

Basis for Opinion

We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are
further described in the Auditor’s responsibilities for the
audit of the financial statements section of our report.
We are independent of the Group in accordance with the
ethical requirements that are relevant to our audit of the
financial statements in the UK, including the FRC’s Ethical
Standard as applied to listed entities, and we have
fulfilled our other ethical responsibilities in accordance
with those requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.

An Overview of the Scope of our Audit

We planned and performed our audit by obtaining
an understanding of the Group and its environment,
including the accounting processes and controls,
and the industry in which it operates.

• 18 UK subsidiary companies;

• 1 wholly owned US based subsidiary;

• 1 wholly owned Germany based subsidiary;

• 3 wholly owned Asian subsidiaries;

• A 70% owned Asian sub group comprising
5 locally incorporated companies; and

• 2 UK holding companies.

Of the Group’s 30 (2021: 26) reporting components,
we subjected 3 to full scope audits and 6 to specific
audit procedures. The remaining components were
subject to analytical review procedures. All of the work
was carried out by the Group audit team. Those
components subject to audit and specific audit
procedures cover 75% (2021: 78%) of the Group’s
consolidated operating income and 79% (2021: 80%)
of the Group’s headline absolute operating result
(absolute result does not distinguish between profit
or loss at subsidiary level). Our audit work at the
component level is executed at levels of materiality
appropriate for such components, which range from
11% to 52% of Group materiality.

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)
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. These matters were addressed
in the context of our audit of the financial statements as
a whole, and in forming our opinion thereon, and we do
not provide a separate opinion on these matters.

KEY AUDIT MATTER

RESPONSE AND CONCLUSION

REVENUE RECOGNITION

Our audit work included:

The Group’s primary income streams are outlined in the
accounting policies section. We identified that the revenue
recognition risk relates particularly to the correct treatment
of project fees, where the service spans the year end. Assessing
the timing of recognition and valuation of such work involves
estimates and can be complex.

• Assessing and challenging the revenue recognition policies

adopted by the Group to confirm they are appropriate in the
context of the business and in accordance with IFRS15.

• Reviewing a sample of open jobs at the year end across the
Group and testing accuracy, completeness and cut off.

• Reconciling open job reports at the year end to revenue and

profit recognised.

• Assessing and challenging on a sample basis whether revenue

and profit recognised on open jobs is complete and
appropriately valued.

• Evaluating the accuracy of accrued income in the previous year
against actual outcomes to determine whether management’s
estimations have been reliable.

As a result of the procedures performed, we are satisfied that
revenue has been correctly recorded.

GOODWILL IMPAIRMENT

Our audit work included:

The impairment review of the Group’s carrying value of Goodwill
arising on consolidation is one of the main areas of estimation.
At 31 December 2022, the carrying value of goodwill in the Group
balance sheet was £96m (2021: £95m). We identified that the
audit risk relates to ensuring that management’s impairment
review is robust and reliable in identifying potential impairment,
and that the assumptions made are reasonable.

The key assumptions used by management in assessing value
in use are:

• Budgets and forecasts for the next 4 years.

• The discount rate applied (the Group’s weighted average

cost of capital – WACC).

• Revised long-term growth rate.

• Assessing and challenging the key assumptions and calculations

applied by management in their impairment reviews.

• Benchmarking the short and long term growth rates to
independent market data to confirm it is appropriate.

• Reviewing the detailed components of the WACC calculation.

• Assessing and challenging management’s sensitivity analysis

on key assumptions and calculations.

• Performing our own sensitivity analysis on short term growth
forecasts and challenging where this results in no or limited
headroom on value in use against carrying value.

• Where there is limited headroom, comparing actual results against
past forecasts used in impairment reviews to assess the reliability
of the forecasts.

• Assessing the disclosures surrounding impairment made in the
financial statements, specifically CGUs that are significantly
underperforming against forecast.

As a result of the procedures performed, we are satisfied that
goodwill held on the balance sheet is not further impaired.

Annual report for the year ended December 2022

Financial Statements
Independent Auditor’s Report

Our Application of Materiality

in planning the scope of our audit, determining the
nature, timing and extent of our audit procedures
and in evaluating the results of our work.

Based on our professional judgement, we determined
materiality for the financial statements as a whole
as follows:

MATERIALITY MEASURE

GROUP

Overall materiality

Performance materiality

Basis for determination

£388,000 (2021: £373,000)

£291,000 (2021: £280,000)

Overall materiality has been set as 5% of Headline profit before tax
(2021: 5% Headline profit before tax). We have considered headline
profit before tax to be the most appropriate measure for materiality
as it best reflects the Group’s underlying trading profitability and
is a key metric used by both management and other stakeholders
in assessing the Group’s performance.

Performance materiality is set as 75% of overall materiality.

Misstatements reported to the audit committee

£12,000 (2021: £11,000)

Range of materiality at components subject to full scope audits / risk specific procedures: £44,000 – £251,000

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’s ability to continue
to adopt the going concern basis of accounting included:

• Assessing the amount of bank facilities and expected

headroom based on the forecast over the next 12 months.

• Evaluating the reliability of the forecast through

discussion with management, review of post year end
trading and considering the historic reliability
of forecasts compared to actual results.

• Reviewing going concern related disclosures in the

• Reviewing and challenging management’s assessment

financial statements to ensure they are appropriate.

of going concern and key assumptions (including
assessment at the planning stage of the audit process).
Our work included assessing the timing and amount
of turnover and related cashflows in the forecast
models. We also tested the integrity and mathematical
accuracy of the models used.

• Reviewing and assessing the appropriateness of

management’s sensitivity analysis including changes
in turnover and related cashflows.

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’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.

Our responsibilities and the responsibilities of the
directors with respect to going concern are described
in the relevant sections of this report.

Other Information

Responsibilities of Directors

The other information comprises the information included
in the annual report other than the financial statements
and our auditor’s report thereon. The directors are
responsible for the other information contained within the
annual report. 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.

Opinions on Other Matters Prescribed by the Companies
Act 2006

In our opinion, based on the work undertaken in the
course of the audit:

• the information given in the Strategic Report and

the Directors’ Report for the financial year for which
the financial statements are prepared is consistent
with the financial statements; and

• the Strategic Report and the Directors’ Report

have been prepared in accordance with applicable
legal requirements.

Matters on Which we are Required to Report by Exception

In the light of the knowledge and understanding of the
Group and its environment obtained in the course of the
audit, we have not identified any material misstatements
in the Strategic Report or the Directors’ Report.

We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:

• adequate accounting records have not been kept,
or returns adequate for our audit have not been
received from branches not visited by us; or

• the financial statements are not in agreement
with the accounting records and returns; or

• certain disclosures of Directors’ remuneration

specified by law are not made; or

• we have not received all the information
and explanations we require for our audit.

As explained more fully in the Directors’ responsibilities
statement set out on pages 40 and 41, the Directors
are responsible for the preparation of the financial
statements and for being satisfied that they give
a true and fair view, and for such internal control
as the Directors determine is necessary to enable the
preparation of the 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 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 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.

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 legal and
regulatory framework applicable to the group and
the industry in which it operates. We identified the
principal risks of non-compliance with laws and
regulations as relating to breaches around health
and safety and General Data Protection Regulation.
We also considered those laws and regulations that
have a direct impact on the preparation of the
financial statements such as financial reporting
legislation (including the Companies Act 2006)
and taxation legislation. We considered the extent
to which any non-compliance with these laws and
regulations may have a negative impact on the group’s
ability to continue trading and the risk of a material
misstatement in the financial statements.

Annual report for the year ended December 2022

Financial Statements
Independent Auditor’s Report

We also evaluated management’s incentives and
opportunities for fraudulent manipulation of the
financial statements and determined that the
principal risks related to the misstatement of the
result for the year, goodwill impairment and
revenue recognition.

Based on this understanding we designed our audit
procedures to identify irregularities. Our procedures
involved the following:

• Both goodwill impairment and revenue recognition
were assessed as Key Audit Matters and our work
in respect of them is detailed above.

• We made enquiries of senior management as to

their knowledge of any non-compliance or potential
non-compliance with laws and regulations that could
affect the financial statements. As part of these
enquiries we also discussed with management whether
there have been any known instances of material
fraud, of which there were none.

• We identified the individuals with responsibility

for ensuring compliance with laws and regulations
and discussed with them the procedures and policies
in place.

• We reviewed minutes of meetings of Senior

Management and those charged with governance.

• We challenged the assumptions and judgements made
by management in its significant accounting estimates.

• We audited the risk of management override of controls,
including through substantively testing journal entries
and other adjustments for appropriateness, and
evaluating the business rationale of significant
transactions outside the normal course of business.

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 Company’s shareholders,
as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken
so that we might state to the Company’s shareholders
those matters we are required to state to them in an audit
report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility
to anyone other than the Company and the Company’s
shareholders as a body for our audit work, for this report,
or for the opinions we have formed.

Duncan Leslie FCA
(Senior Statutory Auditor)

PKF Francis Clark
Statutory Auditor
Centenary House
Peninsula Park
Rydon Lane
Exeter
EX2 7XE

28 March 2023

Annual report for the year ended December 2022

5353

Financial Statements
Consolidated Financial Statements & Notes

Consolidated Income Statement
For the year ended 31 December 2022

Consolidated Statement of Comprehensive Income
For the year ended 31 December 2022

Year to
31 December
2022

Year to
31 December
2021

Year to
31 December
2022

Year to
31 December
2021

PROFIT FOR THE YEAR

Other comprehensive (loss) / income – items that
may be reclassified separately to profit or loss:
Exchange differences on translation of foreign operations

TOTAL COMPREHENSIVE (LOSS) / INCOME FOR THE YEAR

Attributable to:

Equity holders of the parent

Non-controlling interests

£’000

(688)

(652)

(601)

(51)

(652)

£’000

5,319

5,389

5,489

(100)

5,389

TURNOVER

Cost of sales

OPERATING INCOME

Headline operating expenses

HEADLINE OPERATING PROFIT

Goodwill and business impairment

Start-up costs

Acquisition adjustments

Restructuring costs

OPERATING PROFIT

Share of results of associates and joint ventures

PROFIT BEFORE INTEREST AND TAXATION

Net finance costs

PROFIT BEFORE TAXATION

Taxation

PROFIT FOR THE YEAR

Attributable to:

Equity holders of the parent

Non-controlling interests

Basic earnings per share (pence)

Diluted earnings per share (pence)

Headline basic earnings per share (pence)

Headline diluted earnings per share (pence)

Note

£’000

182,685

(102,871)

79,814

(71,157)

8,657

(5,257)

(776)

(593)

(402)

1,629

160

1,789

(1,046)

743

(707)

0.0

6.8

6.7

£’000

153,287

(80,792)

72,495

(64,476)

8,019

(367)

156

(496)

7,312

140

7,452

(701)

6,751

(1,432)

5,319

5,423

(104)

5,319

6.0

5.9

6.6

6.5

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

Consolidated Balance Sheet
As at 31 December 2022

Consolidated Cash Flow Statement
For the year ended 31 December 2022

Note

21.1

FIXED ASSETS

Intangible assets

Property, plant and equipment

Right of use assets

Investments, associates and joint ventures

CURRENT ASSETS

Stock

Trade and other receivables

Cash and short term deposits

CURRENT LIABILITIES

Trade and other payables

Corporation tax payable

Bank loans

Acquisition obligations

NET CURRENT ASSETS

TOTAL ASSETS LESS CURRENT LIABILITIES

NON CURRENT LIABILITIES

Bank loans

Lease liabilities

Acquisition obligations

Deferred tax liabilities

NET ASSETS

CAPITAL AND RESERVES

Called up share capital

Share premium account

Own shares

Share-based incentive reserve

Foreign currency translation reserve

Retained earnings

EQUITY ATTRIBUTABLE TO EQUITY HOLDERS OF THE PARENT

Non-controlling interests

TOTAL EQUITY

As at
31 December
2022

£’000

As at
31 December
2021

£’000

99,741

2,090

9,536

437

111,804

2,185

41,255

6,153

49,593

(39,667)

(794)

(27)

(1,371)

(41,859)

7,734

119,538

(17,488)

(8,481)

(2,772)

(622)

(29,363)

90,175

9,102

45,928

(994)

1,010

(610)

35,558

89,994

181

90,175

98,974

2,102

9,149

517

110,742

2,112

40,538

6,066

48,716

(37,338)

(380)

(692)

(38,410)

10,306

121,048

(16,393)

(8,077)

(2,623)

(483)

(27,576)

93,472

9,102

45,928

(518)

868

37,820

93,200

272

93,472

The financial statements were approved and authorised for issue on 28 March 2023 by the Board of Directors.
They were signed on its behalf by:
Giles Lee, Group Chief Financial Officer

Company registration number: 05733632

Operating profit

Depreciation, amortisation and impairment charges

Decrease in the fair value of contingent consideration

Loss on disposal of property, plant and equipment

Non-cash charge for share options, growth shares and shares
awarded, net of awards settled in cash

Decrease / (increase) in receivables

Increase in stock

Increase in payables

OPERATING CASH FLOWS

Net finance costs paid

Tax paid

Net cash inflow from operating activities

INVESTING ACTIVITIES

Proceeds on disposal of property, plant and equipment

Purchase of property, plant and equipment

Investment in software and product development

Acquisitions of or investments in businesses

Payment relating to acquisitions made in prior years

Cash acquired with subsidiaries

Net cash outflow from investing activities

FINANCING ACTIVITIES

Dividends paid

Dividends paid to non-controlling interests

Payment of lease liabilities

Increase in bank loans

Purchase of own shares held in EBT

Net cash (outflow) / inflow from financing activities

Increase in cash and cash equivalents

Exchange differences on translation of foreign subsidiaries

Cash and cash equivalents at beginning of year

Cash and cash equivalents at end of year

Year to
31 December
2022

Year to
31 December
2021

£’000

1,629

8,701

(334)

149

(73)

1,056

11,211

(1,002)

(482)

9,727

(1,092)

(1,852)

(1,893)

(790)

271

(5,292)

(2,180)

(40)

(1,935)

992

(497)

(3,660)

775

(688)

6,066

6,153

£’000

7,312

4,029

(761)

(48)

(6,703)

(918)

2,798

5,720

(781)

(1,355)

3,584

(884)

(1,024)

(663)

(6,714)

435

(8,778)

(2,100)

(2,016)

11,500

7,384

2,190

3,806

6,066

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

Consolidated Statement of Changes in Equity
For the year ended 31 December 2022

Notes to the Consolidated Financial Statements

Share
capital

Share
premium

Own
shares

Share-
based
incentive
reserve

Foreign
currency
translation
reserve

Retained
earnings

Total
attributable
to equity
holders of
parent

Non-
controlling
interest

Total
equity

£’000

At 1 January 2021

9,102

45,928

(591)

642

(66)

34,842

89,857

372

90,229

Profit for the year

Exchange differences
on translation of
foreign operations

Total comprehensive
income for the year

Share option charge

Growth share charge

Shares awarded and
sold from own shares

Dividend paid

At 31 December 2021

9,102

Profit for the year

Exchange differences
on translation of
foreign operations

Total comprehensive
income for the year

Share option charge

Growth share charge

Own shares
purchased by EBT

Shares awarded and
sold from own shares

Dividend paid

174

45,928

(518)

868

(497)

109

5,423

(104)

5,319

5,423

5,489

(100)

5,389

(610)

174

(345)

(272)

(2,100)

174

(272)

(2,100)

37,820

93,200

272

93,472

(610)

(78)

(688)

(601)

(51)

(652)

109

(497)

109

(497)

(70)

(91)

(70)

(2,180)

(40)

(2,220)

At 31 December 2022

9,102

45,928

(994)

1,010

(610)

35,558

89,994

181

90,175

1. Principal Accounting Policies

Basis of preparation

The Group’s financial statements consolidate the
financial statements of the Company and entities
controlled by the Company (its subsidiaries) made up
to 31 December each year. They have been prepared
in accordance with International Financial Reporting
Standards (IFRS) adopted by the United Kingdom and
on the historical cost basis. The functional currency
of the Group is Pounds Sterling and the level of rounding
applied is £’000.

Basis of consolidation

The results of subsidiaries acquired or disposed of during
the year are included in the Consolidated Statement
of Comprehensive Income from the effective date
of acquisition or up to the effective date of disposal,
as appropriate.

Where necessary, adjustments are made to the financial
statements of subsidiaries to bring accounting policies
used into line with those used by the Group.

All intra-group transactions, balances, income and
expenses are eliminated on consolidation.

Going concern

The Company’s available banking facilities provide
headroom against the Group’s projected cash flows and
the Directors accordingly consider that it is appropriate
to continue to adopt the going concern basis in preparing
these financial statements.

Turnover and revenue recognition policy

The Group’s operating subsidiaries carry out a range
of different activities. The following policies apply
consistently across subsidiaries.

Revenue is recognised when a performance obligation is
satisfied, in accordance with the terms of the contractual
arrangement. Where there are contracts with a variety
of performance obligations that are distinct, an element
of the transaction price is allocated to each performance
obligation and recognised as revenue as and when that
performance obligation is satisfied. Revenue is allocated
to each of the performance obligations based on relative
standalone selling prices. Typically, performance
obligations are satisfied over time as services are
rendered. The nature of the work is almost always such

that it relates to facts and circumstances that are specific
to the Client, with the result that the work performed
does not create an asset with alternative use to the
Group. Therefore, in accordance with IFRS 15, even if the
Client will receive the benefits of the Group's performance
only when the Client receives the piece of work, the
performance obligation is regarded as being satisfied
over time. The Group is generally entitled to payment
for work performed to date.

Contracts are typically short-term in nature and do not
include any significant financing components. The Group
is generally paid in arrears for its services and invoices
are typically payable within 30 to 60 days.

Where performance obligations have been satisfied
and the recorded turnover exceeds amounts invoiced
to Clients, the excess is classified as accrued income
(within Trade and other receivables). Accrued income
is a contract asset and is transferred to trade receivables
when the right to consideration is unconditional and billed
per the terms of the contractual agreement. Where
amounts invoiced to Clients exceed recorded turnover,
because performance obligations have not yet been
satisfied, the excess is classified as deferred income
(within Trade and other payables). These balances are
considered contract liabilities.

The Group has applied the practical expedient permitted
by IFRS 15 to not disclose the transaction price allocated
to performance obligations unsatisfied or partially
unsatisfied as of the end of the reporting period as
contracts typically have an original expected duration
of a year or less.

The amount of revenue recognised depends on whether
the Group acts as principal or agent. Third party costs are
included in revenue when the Group acts as principal with
respect to the goods or services provided to the Client and
are excluded when the Group acts as agent, by reference
to whether or not the Group controls the relevant good
or service before it is transferred to the Client.

The Group has not recognised any significant costs
incurred to obtain or fulfil a Client contract as assets on
the balance sheet. Costs to obtain a contract are typically
expensed as incurred as the contracts are generally short
term in nature.

Turnover represents fees, commissions, rechargeable
expenses and sales of materials performed subject
to specific contracts.

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

Further details on revenue recognition are detailed by
activity below:

incurred to date and actual labour hours devoted to date
relative to the total expected costs and labour hours.

(i) Advertising and ad hoc marketing campaigns

(vi) Learning and training

This typically involves fees for strategic planning and
creative concepts through to execution and delivery
of final campaigns. Revenue may consist of various
arrangements, but typically comprises retainer fees
or fixed price contracts, both of which are recognised
over time. Retainer fees are recognised on a straight-line
basis over the term of the contract. For fixed price
contracts, revenue is recognised based on the actual
service provided to the end of the reporting period as
a proportion of the total services to be provided. This
is typically determined based on third party costs
incurred to date and actual labour hours devoted to date
relative to the total expected costs and labour hours.

(ii) Website, portal or application design and build (Digital)

The Group derives revenue from designing and building
websites, portals and applications under fixed price
contracts. Revenue is typically recognised over time,
determined by applying the hours devoted to date as
a percentage of total hours expected.

(iii) Software development (Digital)

This revenue stream involves the supply of software
licences and aftersales support. If billed as a single fixed
price fee, each of these services is accounted for as
a separate performance obligation, the transaction price
allocated to each being determined by the labour hours
and cost required to supply each service. Revenue
attributable to the provision of the software is recognised
at a point in time when the software licence is made
available for use by the Client. Revenue attributable to the
aftersales support is recognised monthly on a straight-line
basis over the period support is to be provided. In some
cases, the contract might also cover the provision of data
migration and training services, but each of these
is separately billed, the revenue being recognised over
time, determined by applying the hours devoted to date
as a percentage of total hours expected.

(iv) Media buying

Revenue is derived from identifying the Client’s media
requirements and managing and placing orders for the
appropriate media. Revenue is typically recognised at the
point in time the media is aired or on the date of publication.

Revenue is in the form of fixed price fees from planning
and designing training courses and from performing
training courses. Specific training is recognised at a point
in time on the date the training takes place. If the service
provided includes planning and designing the training
course and material, then revenue would be attributed
to this performance obligation and recognised over time
based on third party costs incurred to date and actual
labour hours devoted to date relative to the total
expected costs and labour hours.

(vii) Public Relations

PR revenue is typically derived from retainer fees and
fixed price fees for services to be performed subject to
specific agreement. Revenue under these arrangements
is earned over time, in accordance with the terms
of the contractual arrangement. Retainer fee revenue
is recognised on a straight-line basis over the period
covered by the fee. For ad hoc fixed price projects,
the Group generally applies the hours devoted to date
as a percentage of total hours as the basis for
recognising revenue.

Goodwill and other intangible assets

Goodwill

Goodwill arising from the purchase of subsidiary
undertakings and trade acquisitions represents the excess
of the total cost of acquisition over the Group’s interest
in the fair value of the identifiable assets, liabilities and
contingent liabilities of the subsidiary acquired. The total
cost of acquisition represents both the unconditional
payments made in cash and shares on acquisition and
an estimate of future contingent consideration payments
to vendors in respect of earn-outs.

Goodwill is not amortised but is reviewed annually
for impairment. Goodwill impairment is assessed
by comparing the carrying value of goodwill for each
cash-generating unit to the future cash flows, discounted
to their net present value using an appropriate discount
rate, derived from the relevant underlying assets.
Where the net present value of future cash flows
is below the carrying value of goodwill, an impairment
adjustment is recognised in profit or loss and is not
subsequently reversed.

v) Exhibitions, events and conferences

Other intangible assets

Revenue is derived from the design, planning and supply
of exhibition stands, events and conferences. Revenue is
typically recognised over time based on third party costs

Other intangible assets separately identified as part
of an acquisition are amortised over periods of between
3 and 10 years, except certain brand names which are

considered to have an indefinite useful life. The value
of such brand names is not amortised, but rather
an annual impairment test is applied and any shortfall
in the present value of future cash flows derived from
the brand name versus the carrying value is recognised
in profit and loss. Amortisation and impairment charges
are excluded from headline profit.

Other intangible assets also include costs associated
with the development of identifiable software and other
products. Development expenditure is capitalised only
if the expenditure can be measured reliably, the product
or process is technically and commercially feasible,
future economic benefits are probable and the Group
intends to and has sufficient resources available to
complete development and to use or sell the asset.
Otherwise, it is recognised in profit or loss as incurred.

Development expenditure includes all directly related
costs, including internal staff costs and an element
of directly attributable overheads. Expenditure on
research and sales related activities is recognised in
profit or loss. Subsequent expenditure is capitalised only
when it increases the future economic benefits embodied
in the specific asset to which it relates.

These assets are carried at cost less accumulated
amortisation and are amortised over periods of between
3 and 5 years. Impairments are recognized if the carrying
amount of an asset exceeds the recoverable amount.
Amortisation of software and product development costs
is included within operating expenses.

Contingent consideration payments

The Directors manage the financial risk associated with
making business acquisitions by structuring the terms
of the acquisition, wherever possible, to include an element
of the total consideration payable for the business which
is contingent on its future profitability (i.e. earn-out).
Contingent consideration is initially recognised at its
estimated fair value based on a reasonable estimate
of the amounts expected to be paid. Changes in the fair
value of the contingent consideration that arise from
additional information obtained during the first twelve
months from the acquisition date, about facts and
circumstances that existed at the acquisition date,
are adjusted retrospectively, with corresponding
adjustments against goodwill. The fair value of contingent
consideration is reviewed annually and subsequent
changes in the fair value are recognised in profit or loss
but excluded from headline profits.

financial statements and concluded that the main areas
of judgement are, in order of significance:

Potential impairment of goodwill

The potential impairment of goodwill is based on estimates
of future cash flows derived from the financial projections
of each cash-generating unit over an initial three-year
period and assumptions about growth thereafter,
discussed in more detail in Note 11.

Contingent payments in respect of acquisitions

Contingent consideration, by definition, depends
on uncertain future events. At the time of purchasing
a business, the Directors use the financial projections
obtained during due diligence as the basis for
estimating contingent consideration. Subsequent
estimates benefit from the greater insight gained in the
post-acquisition period and the business’ track record
of financial performance.

Revenue recognition policies in respect of contracts which
straddle the year end

Estimates of revenue to be recognised on contracts which
straddle the year end are typically based on the amount
of time so far committed to those contracts by reference
to timesheets in relation to the total estimated time
to complete them.

Valuation of intangible assets on acquisitions

Determining the separate components of intangible assets
acquired on acquisitions is a matter of judgement
exercised by the Directors. Brand names, customer
relationships and intellectual property rights are the most
frequently identified intangible assets. When considering
the valuation of intangible assets on acquisitions, a range
of methods is undertaken both for identifying intangibles
and placing valuations on them. The valuation of each
element is assessed by reference to commonly used
techniques, such as “relief from royalty” and “excess
earnings” and to industry leaders and competitors.
Estimating the length of Client retention is the principal
uncertainty and draws on historic experience.

Intangible development costs

The Group capitalises development costs within intangible
fixed assets. The key sources of estimation uncertainty
involved in this are:

i. Assessment of proportion of employees’ time spent

Accounting estimates and judgements

on product development.

The Group makes estimates and judgements concerning
the future and the resulting estimates may, by definition,
vary from the actual results. The Directors considered the
critical accounting estimates and judgements used in the

ii. Period of amortisation – the length of time between the
creation of the asset and it being consumed in the sales
of the products created.

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

Share-based payment transactions

Financial instruments

Equity-settled share-based payments are measured at fair
value at the date of grant. The fair value determined at the
grant date of the equity-settled share payments is
expensed on a straight-line basis over the vesting period,
based on the Group’s estimate of the number of shares
that will eventually vest.

Financial assets and financial liabilities are recognised
on the Group’s balance sheet when the Group becomes
a party to the contractual provisions of the instrument.
Issue costs are offset against the proceeds of such
instruments. Financial liabilities are released to income
when the liability is extinguished.

The fair value of nil-cost share options is measured by use
of a Black Scholes model on the grounds that there are no
market-related vesting conditions. The fair value of Growth
Shares is measured by use of a Monte Carlo simulation
model on the grounds that they are subject to market-
based conditions (the future share price of the Company).

Foreign currencies

Assets and liabilities in foreign currencies are translated
into sterling at the rates of exchange ruling at the
balance sheet date. Transactions in foreign currencies
arising from normal trading activities are translated into
sterling at the rate of exchange ruling at the date of the
transaction. Exchange differences are reflected in the
profit or loss accordingly.

The income statements of overseas subsidiary
undertakings are translated at average exchange rates
and the year-end net assets of these companies are
translated at year-end exchange rates. Exchange
differences arising from retranslation of the opening
net assets are reported in the Consolidated Statement
of Comprehensive Income.

Property, plant and equipment

Tangible fixed assets are stated at cost less accumulated
depreciation. Depreciation is provided on all property,
plant and equipment at rates calculated to write off
the cost, less estimated residual value based on prices
prevailing at the date of acquisition, of each asset evenly
over its expected useful economic life, as follows:

Short leasehold improvements

Period of the lease

Motor vehicles

25% per annum

Fixtures, fittings and office equipment

10-33% per annum

Computer equipment

25-33% per annum

Stock

Stock is stated at the lower of cost and net realisable
value and includes the costs of direct materials and
purchases, and the costs of direct labour. Net realisable
value is based on estimated invoice value less further
costs expected to be incurred to completion.

Leases

The Group recognises a right of use asset and
a corresponding lease liability with respect to all lease
arrangements in which it is the lessee, except for short
term leases (defined as leases with a term of 12 months
or less) and leases of low value assets. For these leases,
the Group recognises the lease payments as an operating
expense on a straight-line basis over the lease term.
Lease incentives are spread over the term of the lease.

The lease liability is presented as a separate line in the
Consolidated Balance Sheet. The lease liability is initially
measured at the present value of all future lease
payments, discounted at the rate implicit in the lease,
or if this rate is not readily determined, the incremental
borrowing rate of the Group. Lease payments included
in the measurement of the lease liability include:

• fixed and variable lease payments, less any

lease incentives;

• the amount expected to be payable by the lessee under

residual value guarantees;

• the exercise price of purchase options, if the lessee
is reasonably certain to exercise the options; and

• payments of penalties for terminating the lease,
if the lease term reflects the exercise of an option
to terminate the lease.

The lease liability is subsequently measured by increasing
the carrying amount to reflect interest on the lease liability
(using the effective interest rate method) and by reducing
the carrying amount by any lease payments made.

The Group remeasures the lease liability and makes
a corresponding adjustment to the related right of use
asset whenever:

• the lease term has changed or there is a change in the

assessment of exercise of a purchase option; or

• a lease contract is modified and the lease modification

is not accounted for as a separate lease

in which case the liability is remeasured by discounting
the revised lease payments using a revised discount rate.

The Group has applied the practical expedient that allows
lessees not to account for rent concessions as lease
modifications if they are a direct consequence of COVID-19.

New standards, interpretations and amendments
to existing standards

There are no new or amended standards or interpretations
that impact the Group’s financial statements.

At the date of authorisation of these financial statements,
certain new standards, amendments, and interpretations
to existing standards have been published by the IASB but
are not yet effective and have not been adopted early by
the Group. No new standards in issue but not yet effective
are expected to have a material impact on the Group.

The right of use assets are presented as a separate line
in the Consolidated Balance Sheet. The right of use
assets comprise the initial measurement of the
corresponding lease liability, lease payments made
at or before the commencement day of the lease and any
initial direct costs. They are subsequently measured at
cost less accumulated depreciation and impairment
losses. Whenever the Group incurs an obligation for costs
to dismantle and remove a leased asset, restore the site
on which it is located or restore the underlying asset
to the condition required by the terms and conditions
of the lease, a provision is recognised and measured
under IAS 37. The costs are included in the related right
of use asset.

Right of use assets are depreciated over the shorter
period of lease term and useful life of the underlying
asset, unless a lease transfers ownership of the
underlying asset or the cost of the right of use assets
reflects that the Group expects to exercise a purchase
option, in which case the right of use asset is depreciated
over the useful life of the underlying asset.
The depreciation starts at commencement of the lease.

Deferred taxation

Deferred tax is the tax expected to be payable
or recoverable on differences between the carrying
amounts of assets and liabilities in the financial statements
and the corresponding tax bases used in the computation
of taxable profit, and is accounted for using the balance
sheet liability method.

Deferred tax liabilities are generally recognised for all
taxable temporary differences and deferred tax assets are
recognised to the extent it is probable that taxable profits
will be available against which deductible temporary
differences can be utilised.

Where material intangible assets are recognised on
acquisition which will be amortised over their useful lives,
a deferred tax liability is also recognised and released
against income over the corresponding period.

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

2. Segmental Information

IFRS 15: Revenue from Contracts with Customers requires the disaggregation of revenue into categories that depict how
the nature, amount, timing and uncertainty of revenue and cash flows are affected by economic factors. The Board has
considered how the Group’s revenue might be disaggregated in order to meet the requirements of IFRS 15 and has
concluded that the activity and geographical segmentation disclosures set out below represent the most appropriate
categories of disaggregation. The Board considers that neither differences between types of Clients, sales channels and
markets nor differences between contract duration and the timing of transfer of goods or services are sufficiently
significant to require further disaggregation.

For management purposes the Group monitored the performance of its separate operating units, each of which carries
out a range of activities, as a single business segment. However, since different activities have different revenue
characteristics, the Group’s turnover and operating income has been disaggregated below to provide additional benefit
to readers of these financial statements.

Following the implementation of a Shared Services function from the start of 2018 and the resulting transfer of certain
Agency-specific contracts onto centrally-managed arrangements, a significant portion of the total operating costs are
now centrally managed and segment information is therefore now only presented down to the operating income level.

Year to 31 December 2022

Turnover

Operating income

Year to 31 December 2021

Turnover

Operating income

Advertising
& Digital

£’000

109,406

62,045

Advertising
& Digital

£’000

103,062

56,725

Media Buying

Events

Public Relations

£’000

39,008

4,335

£’000

25,440

6,255

£’000

8,831

7,179

Media Buying

Events

Public Relations

£’000

28,878

3,305

£’000

13,081

5,492

£’000

8,266

6,973

Total

£’000

182,685

79,814

Total

£’000

153,287

72,495

As contracts typically have an original expected duration of less than one year, the full amount of the accrued income
balance at the beginning of the year is recognised in revenue during the year. All media buying turnover is recognised
at a point in time. Virtually all other turnover from continuing operations is recognised over time.

Assets and liabilities are not split between activities.

Geographical segmentation

The following table provides an analysis of the Group’s operating income by region of activity:

USA

Asia

Rest of Europe

Year to
31 December
2022

Year to
31 December
2021

£’000

67,766

9,156

2,667

225

79,814

£’000

63,160

6,425

2,720

190

72,495

3. Reconciliation of Headline Profit to Reported Profit

The Board believes that headline profits, which eliminate certain amounts from the reported figures, provide a better
understanding of the underlying trading of the Group. The adjustments to reported profits generally fall into three
categories: acquisition-related items, exceptional restructuring costs and start-up costs.

Headline profit

Year ended
31 December
2022

PBT
£’000

7,771

PAT
£’000

6,130

Goodwill and business impairment

(5,257)

(4,697)

Start-up costs

Acquisition-related items (Note 4)

Restructuring costs

Reported profit

(776)

(593)

(402)

743

(629)

(443)

(325)

Year ended
31 December
2021

PAT
£’000

5,819

(341)

243

(402)

5,319

PBT
£’000

7,458

(367)

156

(496)

6,751

Goodwill and business impairment costs relate to the impairment of Splash goodwill and the impairment of Pathfindr fixed
assets and stock, following a review of the valuation of these cash generating units and assets, and the loss on disposal
of the Fenturi investment in associate and write-off of intercompany balance.

Start-up costs derive from organically started businesses or loss-making businesses acquired and comprise the trading
losses of such entities until the earlier of two years from commencement or when they show evidence of becoming
sustainably profitable. Start-up costs in 2022 relate to the trading losses of the new Livity youth-marketing offer as well as
costs associated with the early-stage foundation of performance marketing and data science capabilities. Start-up costs
in 2021 related to the launch of a Mongoose Sports venture in Birmingham and the venture Alive, launched in Asia in 2021.

Restructuring costs in 2022 comprised the costs associated with the major fundamental restructuring of the Splash business.
Board restructuring costs in 2021 comprised leaving packages payable to former MISSION directors Robert Day,
Peter Fitzwilliam and David Morgan following their resignations.

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

4. Acquisition Adjustments

6. Profit Before Taxation

Profit or loss on ordinary activities before taxation is stated after charging / (crediting):

Decrease in fair value of contingent consideration

Amortisation of other intangibles recognised on acquisitions

Acquisition transaction costs expensed

Year to 31
December
2022

£’000

334

(519)

(408)

(593)

Year to 31
December
2021

£’000

761

(446)

(159)

156

The decrease in fair value of contingent consideration relates to a net downward (2021: downward) revision in the
estimate payable to vendors of businesses acquired in prior years. Acquisition transaction costs relate to professional
fees in connection with acquisitions made or contemplated.

5. Net Finance Costs

Interest on bank loans and overdrafts, net of interest on bank deposits

Amortisation of bank debt arrangement fees

Interest expense on lease liabilities

Net finance costs

Year to 31
December
2022

£’000

(656)

(48)

(342)

(1,046)

Year to 31
December
2021

£’000

(283)

(67)

(351)

(701)

Depreciation of owned tangible fixed assets

Depreciation expense on right of use assets

Amortisation of intangible assets recognized on acquisitions

Amortisation of other intangible assets

Expense relating to short term leases

Expense relating to low value leases

Income from subleasing right of use assets

Staff costs before furlough grants (Note 7)

Furlough grants received (Note 7)

Bad debts and net movement in provision for bad debts

Auditors’ remuneration

(Profit) / loss on foreign exchange

Auditors’ remuneration may be analysed by:

Audit of Group’s annual report and financial statements

Audit of subsidiaries

Audit related assurance services

Corporate finance

Year to 31
December
2022

Year to 31
December
2021

£’000

1,068

1,918

519

337

376

(194)

55,032

386

238

(411)

Year to 31
December
2022

£’000

128

238

£’000

1,094

1,995

446

494

521

49,629

(347)

177

179

Year to 31
December
2021

£’000

111

179

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

7. Employee Information

Directors’ Remuneration

The average number of Directors and staff employed by the Group during the year analysed by segment,
was as follows:

Directors’ remuneration is derived from their role as either a Board member of MISSION or as an Executive Director
of one of the Group’s Agencies. Remuneration for the year was as follows (all amounts in £’000):

Year to 31
December
2022

Year to 31
December
2021

Salary / Fees

Performance
- related
payments

Benefits

Pension

Advertising & Digital

Media Buying

Events

Public Relations

Central

878

1,087

The aggregate employee costs of these persons included in operating expenses were as follows:

Wages and salaries

Social security costs

Pension costs

Share based payment expense

Total employee costs before furlough grants

Furlough grants received

Net employee costs after furlough grants

Year to 31
December
2022

£’000

47,593

5,453

1,844

142

55,032

760

984

Year to 31
December
2021

£’000

42,522

5,075

1,806

226

49,629

(347)

49,282

The Group operates twenty six (2021: twenty) defined contribution pension schemes. The pension cost charge for the
year represents contributions payable by the Group to the schemes. At the end of the financial year outstanding
contributions amounted to £279,000 (2021: £275,000).

As Board Directors

Julian Hanson-Smith (Chair)

James Clifton (Chief Executive)

Eliza Filby (Non-Executive
from 1 January 2022)

Mark Lund (Non-Executive
from 1 October 2022)

Giles Lee (Chief Financial Officer)

Andy Nash (Non-Executive
to 30 September 2022)

Total

As Agency Directors

Dylan Bogg

Sue Mullen

Fiona Shepherd

Former Directors

Barry Cook
(to 30 April 2021)

Robert Day
(to 30 September 2021)

Peter Fitzwilliam
(to 30 April 2021)

David Morgan
(to 30 September 2021)

Total

Notes:

310

222

716

151

127

221

156

101

257

111

Total
2022

480

350

1,018

174

143

357

Total
2021

437

319

864

180

176

259

422*

177*

338*

1,215

374

1,692

2,426*

* During 2021 costs were incurred relating to former Directors as part of restructuring the Board. These costs have been

treated as headline adjustments (see Note 3).

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

8. Taxation

9. Dividends

Amounts recognised as distributions to equity holders in the year:

Interim dividend of 0.83 pence (2021: 0.80 pence) per share

Final dividend of 1.60 pence (2021: deferred 2019 final dividend
of 1.53 pence) per share

Year to 31
December
2022

£’000

743

1,437

2,180

Year to 31
December
2021

£’000

721

1,379

2,100

The 2019 final dividend of 1.53 pence per share was proposed in the 2019 annual report and accounts but subsequently
deferred due to the priority to preserve cash during the pandemic. Following the much-improved net debt position at
31 December 2020, this dividend was paid in March 2021 and, in accordance with IFRS, recognised in the 2021 accounts.

A final dividend of 1.67 pence per share is to be paid in July 2023 should it be approved by shareholders at the AGM.
In accordance with IFRS this final dividend will be recognised in the 2023 accounts.

Current tax:

UK corporation tax at 19.00% (2021: 19.00%)

Adjustment for prior periods

Foreign tax on profits of the period

Deferred tax:

Current year originating temporary differences

Tax charge for the year

Year to 31
December
2022

£’000

380

(36)

364

708

(1)

707

Factors Affecting the Tax Charge for the Current Year:

The tax assessed for the year is higher (2021: higher) than the standard rate of corporation tax in the UK.
The differences are:

Profit before taxation

Profit on ordinary activities before tax at the standard rate
of corporation tax of 19.00% (2021: 19.00%)

Effect of:

Rate changes

Non-deductible expenses / income not taxable

Depreciation (lower than) / in excess of capital allowances

Losses not utilised

Higher rates on overseas earnings

Adjustments in respect of prior periods

Other differences

Actual tax charge for the year

Year to 31
December
2022

£’000

743

141

(99)

562

(76)

190

(36)

707

Year to 31
December
2021

£’000

1,133

(64)

226

1,295

137

1,432

Year to 31
December
2021

£’000

6,751

1,283

119

(42)

(32)

160

(64)

(28)

1,432

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

10. Earnings Per Share

11. Intangible Assets

The calculation of the basic and diluted earnings per share is based on the following data, determined in accordance
with the provisions of IAS 33: Earnings Per Share.

Earnings

Reported profit for the year

Attributable to:

Equity holders of the parent

Non-controlling interests

Headline earnings (Note 3)

Attributable to:

Equity holders of the parent

Non-controlling interests

Number of shares

Year to 31
December
2022

£’000

Year to 31
December
2021

£’000

6,103

6,130

5,423

(104)

5,319

5,923

(104)

5,819

Weighted average number of Ordinary shares for the purpose
of basic earnings per share

89,906,999

90,134,211

Dilutive effect of securities:

Employee share options

Weighted average number of Ordinary shares for the purpose
of diluted earnings per share

Reported basis

Basic earnings per share (pence)

Diluted earnings per share (pence)

Headline basis:

Basic earnings per share (pence)

Diluted earnings per share (pence)

617,992

90,524,991

1,414,543

91,548,754

0.0

6.8

6.7

6.0

5.9

6.6

6.5

A reconciliation of the profit after tax on a reported basis and the headline basis is given in Note 3.

Goodwill

Other intangible assets

Goodwill

Cost

At 1 January

Recognised on acquisition of subsidiaries

At 31 December

Impairment adjustment

At 1 January and 31 December

Impairment during the year

At 31 December

Net book value at 31 December

31 December
2022

31 December
2021

£’000

96,213

3,528

99,741

Year to 31
December
2022

£’000

98,877

3,609

102,486

4,273

2,000

6,273

96,213

£’000

94,604

4,370

98,974

Year to 31
December
2021

£’000

96,433

2,444

98,877

4,273

94,604

In accordance with the Group’s accounting policies, an annual impairment test is applied to the carrying value of
goodwill. The review performed assesses whether the carrying value of goodwill is supported by the net present value
of projected cash flows derived from the underlying assets for each cash-generating unit (“CGU”), discounted using
an appropriate discount rate. It is the Directors’ judgement that each distinct Agency represents a CGU. The initial
projection period of four years includes the annual budget for each CGU, based on insight into Clients’ planned
marketing expenditure and targets for net new business growth derived from historical experience, and extrapolations
of the budget in subsequent years based on known factors and estimated trends. The key assumptions used by each
CGU concern revenue growth and staffing levels and different assumptions are made by different CGUs based on
their individual circumstances. Beyond this initial projection period, a generic long term growth rate of 2.0% is assumed
for all units based on information published by market analysts. The resulting pre-tax cash flow forecasts were
discounted using the Group’s estimated pre-tax Weighted Average Cost of Capital (“WACC”), which is 8.36%
(2021: 8.75%, the average of the WACC over the 10 years from 2012 to 2021).

As a result of the performance and restructuring of the operations of Bray Leino Splash Pte Ltd, the Directors
considered it prudent to impair £2.0m of goodwill relating to this CGU. No other impairments in goodwill were required.
No change to this conclusion is reached as a result of the following independent changes in assumptions: nil growth
in 2023 and a one-year delay in the achievement of 2023 budgets; any reduction in short term growth rates beyond
2024; nil long term growth rates; a 1% increase in discount rate. The only change in assumptions that would result
in a material impairment in the carrying value of the Group’s goodwill is an increase in discount rate of 4%, which
management do not believe is a reasonably possible change in key assumption.

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

11. Intangible Assets – continued

Goodwill arose from the acquisition of the following subsidiary companies and trade assets and is comprised of the
following substantial components:

31 December
2022

31 December
2021

April Six Ltd and April Six (Mobility) Ltd

Bray Leino Ltd

Influence Sports Ltd

Krow Agency Ltd and Krow Communications Ltd

Mongoose Sports & Entertainment Ltd

RJW & Partners Ltd

Solaris Healthcare Network Ltd

Soul (London) Ltd

Speed Communications Agency Ltd

Bray Leino Splash Pte. Ltd

Story Agency Ltd (formerly Chapter Agency Ltd)

Story UK Ltd

ThinkBDW Ltd

Other smaller acquisitions

£’000

14,832

27,761

2,834

18,327

931

4,962

1,058

2,444

3,085

356

3,440

7,516

6,283

2,384

96,213

£’000

14,832

27,761

18,327

931

4,962

1,058

2,444

3,085

2,356

3,440

7,516

6,283

1,609

94,604

Other intangible assets

Cost

At 1 January 2021

Additions

Disposals

At 31 December 2021

Additions

Transfers to PPE

Disposals

Impairment

At 31 December 2022

Amortisation and impairment

At 1 January 2021

Charge for the year

Disposals

At 31 December 2021

Charge for the year

Transfers to PPE

Disposals

Impairment

At 31 December 2022

Net book value at 31 December 2022

Net book value at 31 December 2021

Software and
product
development

Trade names

Customer
relationships

£’000

2,969

1,024

(165)

3,828

1,852

(103)

(3)

(2,875)

2,699

1,465

494

(165)

1,794

337

(100)

(2)

(277)

1,752

947

2,034

1,858

100

1,958

150

5,994

160

6,154

614

2,108

6,768

462

553

110

663

1,445

1,405

4,868

355

5,223

409

5,632

1,136

931

Total

£’000

10,821

1,284

(165)

11,940

2,616

(103)

(3)

(2,875)

11,575

6,795

940

(165)

7,570

856

(100)

(2)

(277)

8,047

3,528

4,370

Additions of £1,852,000 (2021: £1,024,000) in the year include costs associated with the development of identifiable
software and other products that are expected to generate economic benefits in excess of the costs of development.

Included within the value of intangible assets is an amount of £783,000 (2021: £783,000) relating to trade names
of businesses acquired, which are deemed to have indefinite useful lives. These trade names have attained recognition
in the marketplace and the companies acquired will continue to operate under the relevant trade names, which will
play a role in developing and sustaining customer relationships for the foreseeable future. As such, it is the Directors’
judgement that the useful life of these trade names is considered to be indefinite.

Intangible assets include an amount of nil (2021: £1,202,000) relating to product development costs in Pathfindr. At the
end of 2022 it was decided that the full value of capitalised product development costs in Pathfindr should be impaired
as the sales and improved profitability that was expected from these products was believed to be unlikely to materialise
in the short-term.

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

11. Intangible Assets – continued

13. Property, Plant and Equipment

Also included is an amount of £393,000 (2021: £468,000) relating to the krow trade name, which has attained
recognition in the marketplace and plays a role in attracting and retaining Clients. This value will be amortised over
the next 5 years (2021: 6 years). In addition there are amounts of £393,000 (2021: £708,000) and £473,000 (2021: nil)
included relating to krow customer relationships and Influence customer relationships respectively. krow and Influence
have developed a base of customers to whom the Group would expect to continue selling in the future. The remaining
useful life of the krow customer relationships is deemed to be 1 year (2021: 2 years), and of the Influence customer
relationships is deemed to be 3 years. The values will be amortised over these periods.

12. Subsidiaries

The Group’s principal trading subsidiaries are listed below. All subsidiaries are 100% owned and all are incorporated
in the United Kingdom, except for Spark Marketing Services Ltd which is 75% owned, Pathfindr Ltd which is 80% owned,
and Bray Leino Splash Pte. Ltd which is 70% owned and incorporated in Singapore. A full list of all Group companies
at 31 December 2022 can be found in Note 42 to the Company Financial Statements.

Subsidiary undertaking

Nature of business

April Six Ltd

Marketing communications, specialising in the technology sector

April Six (Mobility) Ltd (formerly RLA Group Ltd)

Marketing communications, specialising in the automotive sector

Bray Leino Ltd

Bray Leino Splash Pte. Ltd

Influence Sports Ltd

Krow Agency Ltd

Krow Communications Ltd

Advertising, media buying, digital marketing, events and training

Digital marketing

Sports and entertainment marketing

Marketing communications

Mongoose Sports & Entertainment Ltd

Sports, fitness and entertainment marketing

Pathfindr Ltd

RJW & Partners Ltd

Soul (London) Ltd

Creator of IIoT solutions

Pricing and market access in the healthcare sector

Marketing communications

Solaris Healthcare Network Ltd

Marketing communications, specialising in the medical sector

Spark Marketing Services (formerly Mongoose Promotions Ltd)

Sales promotion

Speed Communications Agency Ltd

Public relations

Story Agency Ltd (formerly Chapter Agency Ltd)

Marketing communications

Story UK Ltd

ThinkBDW Ltd

Marketing communications

Marketing communications, specialising in the property sector

Fixtures &
fittings and
office
equipment

Property

Computer
equipment

Motor vehicles

£’000

2,280

3,038

3,648

(23)

2,299

111

(4)

(169)

2,251

1,652

140

(1)

1,791

144

(148)

1,787

464

508

118

(775)

2,381

256

275

(150)

(62)

2,707

2,153

388

(728)

1,813

284

268

(103)

(41)

2,221

486

568

663

(338)

3,974

725

(168)

(403)

4,162

2,780

549

(325)

3,004

618

(168)

(398)

3,056

1,106

970

(1)

119

(17)

102

(17)

Total

£’000

9,025

884

(1,137)

8,773

1,092

103

(739)

(62)

9,222

6,631

1,094

(1,054)

6,671

1,068

100

(666)

(41)

7,132

2,090

2,102

Cost or valuation

At 1 January 2021

Acquisition of subsidiaries

Additions

Disposals

At 31 December 2021

Acquisition of subsidiaries

Additions

Transfers between categories
and from other intangible assets

Disposals

Impairment

At 31 December 2022

Depreciation

At 1 January 2021

Charge for the year

Disposals

At 31 December 2021

Charge for the year

Transfers between categories
and from other intangible assets

Disposals

Impairment

At 31 December 2022

Net book value at 31 December 2022

Net book value at 31 December 2021

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

14. Right of Use Assets

16. Trade and Other Receivables

The Group leases several assets including property, office equipment, computer equipment and motor vehicles.

Fixtures &
fittings and
office
equipment

Property

Computer
equipment

Motor vehicles

£’000

Net carrying amount

At 31 December 2021

At 31 December 2022

Depreciation expense

Year to 31 December 2021

Year to 31 December 2022

Additions

Year to 31 December 2021

Year to 31 December 2022

8,815

9,004

1,700

1,638

184

1,705

15. Investments, Associates and Joint Ventures

At 1 January

Profit during the year

Additions

Disposal of Fenturi

At 31 December

In 2022 Fenturi was disposed of.

302

506

272

273

225

467

Year to 31
December
2022

£’000

517

160

(240)

437

Total

£’000

9,149

9,536

1,995

1,918

415

2,183

Year to 31
December
2021

£’000

317

140

517

Trade receivables

Accrued income

Prepayments

Other receivables

31 December
2022

31 December
2021

£’000

25,052

13,273

2,051

879

41,255

£’000

25,727

11,551

2,154

1,106

40,538

An allowance has been made for estimated irrecoverable amounts from the provision of services of £228,000
(2021: £225,000). The estimated irrecoverable amount is arrived at by considering the historical loss rate and
adjusting for current expectations, Client base and economic conditions. Both historical losses and expected future
losses being very low, the Directors consider it appropriate to apply a single average rate for expected credit losses
to the overall population of trade receivables and accrued income. Accrued income relates to unbilled work in progress
and has substantially the same risk characteristics as the trade receivables for the same types of contracts.
The Directors consider that the carrying amount of trade and other receivables approximates their fair value.

Gross trade receivables

Gross accrued income

Total trade receivables and accrued income

Expected loss rate

Provision for doubtful debts

31 December
2022

31 December
2021

£’000

25,280

13,273

38,553

0.6%

228

£’000

25,952

11,551

37,503

0.6%

225

Trade receivables include £6.5m (2021: £7.4m) that is past due but not impaired, of which £1.0m (2021: £1.1m) is greater
than 3 months past due.

Accrued income has increased by £1,722,000 as a result of an increase in the volume of work taking place just prior
to the 2022 year end, including two large campaigns from new clients, where the work has been performed prior to
year end, but the customer will only be invoiced and pay in 2023.

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

16. Trade and Other Receivables – continued

19. Bank Overdrafts, Loans and Net Bank Debt

Credit risk

The Group’s principal financial assets are trade receivables, accrued income and bank balances, which represent the
Group’s maximum exposure to credit risk in relation to financial assets.

The Group’s credit risk is primarily attributable to its trade receivables and accrued income. The credit risk on cash
balances is limited because the counterparties are banks with high credit-ratings assigned by international
credit-rating agencies.

The majority of the Group’s trade receivables and accrued income is due from large national or multinational companies
where the risk of default is considered low. In order to mitigate this risk further, the Group has arranged credit insurance
on certain of its trade receivables as deemed appropriate. Where credit insurance is not considered cost effective, the
Group monitors credit-worthiness closely and mitigates risk, where appropriate, through payment plans.

There can be no assurance that any of the Group’s Clients will continue to utilise the Group’s services to the same extent,
or at all, in the future. The loss of, or a significant reduction in advertising and marketing spending by, the Group’s largest
Clients, if not replaced by new Client accounts or an increase in business from existing Clients, would adversely affect
the Group’s prospects, business, financial condition and results of operations. The impact would however be limited
as only three Clients represented more than 3% of total operating income in 2022 (2021: three Clients).

17. Cash and Short Term Deposits

Cash and short term deposits comprise cash held by the Group and short term bank deposits.

18. Trade and Other Payables

Bank loan outstanding

Unamortised bank debt arrangement fees

Carrying value of loan outstanding

Less: Cash and short term deposits

Net bank debt

The borrowings are repayable as follows:

Less than one year

In one to two years

In two to three years

In three to four years

31 December
2022

31 December
2021

Unamortised bank debt arrangement fees

Trade creditors

Deferred income

Other creditors and accruals

Other tax and social security payable

Lease liabilities (Note 20)

£’000

14,454

8,903

10,771

3,957

1,582

39,667

£’000

10,807

9,128

11,196

4,611

1,596

37,338

Trade creditors increased as a result of the increased level of trading towards the end of 2022 versus 2021, accompanied
by slightly slower payment of creditors as evidenced by an increase in trade creditors days.

The Directors consider that the carrying amount of trade and other payables approximates their fair value.

31 December
2022

31 December
2021

£’000

17,575

(60)

17,515

(6,153)

11,362

17,521

17,575

(60)

17,515

17,488

£’000

16,500

(107)

16,393

(6,066)

10,327

16,500

(107)

16,393

Less: Amount due for settlement within 12 months
(shown under current liabilities)

Amount due for settlement after 12 months

Bank debt arrangement fees, where they can be amortised over the life of the loan facility, are included in finance
costs. The unamortised portion is reported as a reduction in bank loans outstanding.

Included in the above is £75,000 of bank loans owing by Populate Social Ltd, one of the companies acquired during
the year. These borrowings are repayable over a four year period.

At 31 December 2022, the Group’s committed bank facilities comprised a revolving credit facility of £20m, expiring
on 5 April 2024, with an option to increase the facility by £5m and by one year. Interest on the new facility is based
on SONIA (sterling overnight index average) plus a margin of between 1.50% and 2.25% depending on the Group’s debt
leverage ratio, payable in cash on loan rollover dates. On 8 March 2023 the option to extend the facility by one year
was exercised, extending the facility expiration date to 5 April 2025.

In addition to its committed facilities, at 31 December 2022 the Group had available an overdraft facility of up to £3.0m
with interest payable by reference to National Westminster Bank plc Base Rate plus 2.25%.

At 31 December 2022, there was a cross guarantee structure in place with the Group’s bankers by means of a fixed
and floating charge over all of the assets of the Group companies in favour of National Westminster Bank plc.

All borrowings are in sterling.

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

20. Lease Liabilities

Obligations under leases are due as follows:

In one year or less (shown in trade and other payables)

In more than one year

31 December
2022

31 December
2021

£’000

1,582

8,481

10,063

£’000

1,596

8,077

9,673

The fair values of the Group’s lease obligations approximate their carrying amount.

The Group’s obligations under leases are secured by the lessor’s charge over the leased assets.

21. Acquisitions

21.1 Acquisition Obligations

The terms of an acquisition provide that the value of the purchase consideration, which may be payable in cash
or shares at a future date, depends on uncertain future events such as the future performance of the acquired company.
The Directors estimate that the liability for contingent consideration payments is as follows:

31 December 2022

31 December 2021

Cash

Total

Cash

£’000

Less than one year

Between one and two years

In more than two years but less than three years

In more than three years but less than four years

1,371

1,820

899

4,143

A reconciliation of acquisition obligations during the period is as follows:

At 31 December 2021

Obligations settled in the period

Adjustments to estimates of obligations

New acquisitions

At 31 December 2022

1,371

1,820

899

4,143

Cash

£’000

3,315

(790)

(334)

1,952

4,143

692

430

300

1,893

3,315

£’000

Total

£’000

692

430

300

1,893

3,315

Total

£’000

3,315

(790)

(334)

1,952

4,143

21. Acquisitions – continued

21.2 Acquisition of Influence Sports Ltd

On 7 December 2022, the Group acquired the entire issued share capital of Influence Sports Ltd (“Influence”).
Headquartered in London and with a strong presence in the US, Influence works with sponsors and brands, rights
holders, investors and industry Clients to deliver marketing communications strategies, commercial programs, and
actionable market intelligence. The fair value of the consideration given for the acquisition was £3,337,000, comprising
initial cash consideration and deferred contingent consideration. The deferred contingent consideration is to be
satisfied by the issue of new ordinary shares up to a maximum of 40% at MISSION's discretion, with the balance
payable in cash. Costs relating to the acquisition amounted to £128,000 and were expensed.

Maximum contingent consideration of £6,500,000 is dependent on Influence achieving a profit target over the period
1 January 2023 to 31 December 2025. The Group has provided for contingent consideration of £1,780,000 to date.

The fair value of the net identifiable assets acquired was £73,000 resulting in goodwill and previously unrecognised
other intangible assets of £3,264,000. Goodwill arises on consolidation and is not tax-deductible. Management carried
out a review to assess whether any other intangible assets were acquired as part of the transaction. Management
concluded that both a brand name and customer relationships were acquired and attributed a value to each of these
by applying commonly accepted valuation methodologies. The goodwill arising on the acquisition is attributable to the
anticipated profitability of Influence.

Net assets acquired:

Fixed assets

Trade and other receivables

Cash and cash equivalents

Trade and other payables

Deferred tax

Other intangibles recognised at acquisition

Deferred tax adjustment

Goodwill

Total consideration

Satisfied by:

Cash

Deferred contingent consideration

Book
value

£’000

Fair value
adjustments

£’000

460

(483)

(2)

573

(143)

430

Fair
value

£’000

460

(483)

(2)

573

(143)

503

2,834

3,337

1,557

1,780

3,337

Influence contributed turnover of £439,000, operating income of £329,000 and headline operating profit of £222,000
to the results of the Group in 2022.

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

21. Acquisitions – continued

21.3 Other Acquisitions

A total of £508,000 was invested in other acquisitions during the year, comprising initial cash consideration of £336,000
and deferred contingent consideration of £172,000.

21.4 Pro-forma results including acquisitions

The Directors estimate that the turnover, operating income and headline operating profit of the Group would have been
approximately £185.2m, £80.8m and £9.0m had the Group consolidated the results of the acquisitions made during the year,
from the beginning of the year.

22. Share Capital

23. Own Shares

At 31 December 2020

Awarded or sold during the year

At 31 December 2021

Own shares purchased

Awarded or sold during the year

At 31 December 2022

No. of shares

£'000

897,814

(179,676)

718,138

827,937

(50,537)

1,495,538

591

(73)

518

497

(21)

994

Allotted and called up:

91,015,897 Ordinary shares of 10p each
(2021: 91,015,897 Ordinary shares of 10p each)

Share-based incentives

The Group has the following share-based incentives in issue:

31 December
2022

£’000

31 December
2021

£’000

9,102

TMMG Long Term Incentive Plan

At start
of year

711,211

Growth Share Scheme

3,200,000

Granted/
acquired

Waived/
lapsed

Exercised

At end
of year

(146,628)

(171,362)

393,221

3,200,000

The TMMG Long Term Incentive Plan (“LTIP”) was created to incentivise senior employees across the Group. Nil-cost
options are awarded at the discretion of, and vest based on criteria established by, the Remuneration Committee.
During the year, 171,362 options were exercised at an average share price of 59.7p and at the end of the year 271,859
of the outstanding options are exercisable.

Shares held in an Employee Benefit Trust (see Note 23) will be used to satisfy share options exercised under the Long Term
Incentive Plan.

A Growth Share Scheme was implemented in June 2021. Participants in the scheme subscribed for Ordinary B shares
in The Mission Marketing Holdings Limited (the “growth shares”) at a nominal value. These growth shares can be
exchanged for an equivalent number of Ordinary Shares in MISSION if MISSION’s share price equals or exceeds 150p
for at least 15 consecutive days during the period ending on the date the Company’s financial results for the year
ended 31st December 2023 are announced; if not, they will have no value.

Shares are held in an Employee Benefit Trust to meet certain requirements of the Long Term Incentive Plan. During the
year, 827,937 (2021: nil) shares were purchased at an average share price of 60.0p. This represents 0.9% of the total
issued share capital.

24. Share-Based Incentive Reserve

The share-based incentive reserve represents charges to the profit or loss required by IFRS 2 to reflect the cost of the
nil-cost share options and growth shares issued to the Directors and employees.

25. Share-Based Payments

Nil-cost share options

Details of the relevant option schemes are given in Note 22. Fair value on grant date is measured by use of a Black Scholes
model. The valuation methodology is applied at each year-end and the valuation revised to take account of any changes
in estimate of the likely number of shares expected to vest. No options were issued during 2022 or 2021.

The weighted average share price over the three years ending 31 December 2022 was 69.7p and the weighted average
remaining contractual life of the share options outstanding at 31 December 2022 was 4.0 years.

The Group recognised an expense of £33,000 in 2022 (2021: £174,000).

Growth Shares

Details of the Growth Share scheme are given in Note 22. The fair value of growth shares was measured by use of
a Monte Carlo simulation model, which uses probability analysis to calculate the value of options. The fair value of the
growth shares issued in 2021 was 9.0p per share at measurement date. No growth shares were issued in 2022. The key
inputs for the valuation of the growth shares issued in 2021 are:

Share price at grant

Risk free rate

Dividend yield

Expected volatility

75.0p

0.2%

3.0%

33.0%

Volatility is based on the historical volatility of the share price over a 3 year trading period. The weighted average share
price from inception of the scheme until 31 December 2022 was 65.4p and the weighted average remaining contractual
life of the growth shares outstanding at 31 December 2022 was 1.3 years.

The Group recognised an expense of £109,000 in 2022 (2021: £52,000).

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

26. Financial Assets and Liabilities

Capital management

The Group defines “capital” as being debt plus equity. Net bank debt comprises short and long term borrowings net
of cash, cash equivalents and the unamortised balance of bank renegotiation fees as analysed in Note 19. In addition,
the Group treats its commitment to future consideration payments under acquisition agreements as another component
of debt. Equity comprises issued share capital, reserves and retained earnings as disclosed in the balance sheet and
in the Consolidated Statement of Changes in Equity.

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern and
maintain an appropriate capital structure to balance the needs of the Group to grow, whilst operating with sufficient
headroom within its bank covenants. The principal measures by which the Directors monitor capital risk are the ratios
of net bank debt to EBITDA and total debt (including both net bank debt and estimated acquisition consideration payable)
to EBITDA. (Note that, since acquisition consideration is dependent on future levels of profitability in the acquired
business, which are inevitably uncertain, the Directors calculate this ratio by reference to the amount of consideration
which would be payable if the acquired business were to maintain its current level of profitability.) The Directors have set
targets, of remaining below x1.5 and x2.0 for these ratios respectively (calculated on a pre-IFRS 16 basis).

Financial risk management

The Group’s policy is to eliminate financial risk where it is cost-effective, including the use of credit insurance and
currency hedges, and to mitigate it where not, including close monitoring of credit-worthiness and the use of Client
payment plans if possible. The Group’s policy is not to use any financial instruments for speculating.

The Group's principal financial instruments comprise cash and various forms of borrowings.

Substantially all the Group's activities continue to take place in the United Kingdom. Where revenue is generated in one
currency and costs are incurred in another, the Group aims to agree pricing at the outset of a piece of work and then
hedge its foreign currency exposure, if considered significant, through the use of forward exchange contracts. There
was no material foreign currency exposure at the year end.

The main purpose of the Group's use of financial instruments is for day-to-day working capital and as part of the
funding for past acquisitions. The Group’s financial policy and risk management objective is to achieve the best
interest rates available whilst maintaining flexibility and minimising risk. The main risks arising from the Group's use
of financial instruments are interest rate risk and liquidity risk.

Interest rate risk

The operations of the Group generate cash and it funds acquisitions through a combination of retained profits, equity
issues and borrowings. The Group's financial liabilities comprise floating rate instruments. The bank loan’s interest rate
is reset from time to time and accordingly is not deemed a fixed rate financial liability.

Interest on the Group’s revolving credit facility is payable by reference to SONIA (sterling overnight index average),
subject to downward or upward ratchets depending on certain ratios of debt to EBITDA on a quarterly basis. The Directors
have considered again the relative merits of the use of hedging instruments to limit the exposure to interest rate risk.
Since the sensitivity of profits to a 1% change in interest rates is less than £0.2m, they have decided not to enter into any
hedging arrangements.

Liquidity risk

The Group's financial instruments include a mixture of short and long-term borrowings. The Group seeks to ensure
sufficient liquidity is available to meet working capital needs and the repayment terms of the Group's financial
instruments as they mature.

Financial assets

Cash at bank maturing in less than one year or on demand

31 December
2022

£’000

6,153

31 December
2021

£’000

6,066

Financial liabilities

At 31 December 2022

Interest analysis:

Subject to floating rates

Subject to fixed rates

Maturity analysis:

One year or less, or on demand

In one to two years

In two to three years

In three to four years

In four to five years

In more than five years

At 31 December 2021

Interest analysis:

Subject to floating rates

Subject to fixed rates

Maturity analysis:

One year or less, or on demand

In one to two years

In two to three years

In three to four years

In four to five years

In more than five years

Bank loan
and overdraft

Lease
liabilities

Acquisition
obligations

£’000

17,575

16,500

10,063

1,582

1,346

1,170

998

717

4,250

10,063

9,673

1,596

1,209

1,032

875

782

4,179

9,673

4,143

1,371

1,820

899

4,143

3,315

692

430

300

1,893

Total

£’000

17,575

14,206

31,781

2,953

18,974

2,990

1,897

717

4,250

31,781

16,500

12,988

29,488

2,288

1,639

17,832

2,768

782

4,179

The Group's bank loans and overdraft facility are floating rate borrowings and all facilities are secured by a fixed
and floating charge over the assets of all Group companies.

The fair value of the Group's financial assets and liabilities is not considered to be materially different from their
book values.

3,315

29,488

Annual report for the year ended December 2022

Financial Statements
Consolidated Financial Statements & Notes

Financial Statements
Independent Auditor’s Report: Company

27. Leave Pay Accrual

The Group has a policy of not allowing days to be carried forward from one year to the next, unless in exceptional
circumstances. In addition, no payment is made in lieu of untaken leave which is not carried forward. There is no material
liability relating to untaken leave at year end.

28. Post Balance Sheet Events

There have been no material post balance sheet events.

29. Related Party Transactions

The Directors consider that the Directors of the Company represent the Group’s key management personnel for the
purposes of disclosing related party transactions. Directors’ remuneration is disclosed in detail in Note 7. The total
compensation payable to key management personnel is detailed below.

Short-term employee benefits

Post-employment benefits

Share-based payments

Remuneration arising from Board restructuring

Year to
31 December 2022

Year to
31 December 2021

£’000

1,593

1,692

£’000

1,666

217

485

2,426

Bray Leino Ltd rents property from entities under the control of David Morgan, significant shareholder and Chairman
of The MISSION Group plc until retirement on 30 September 2021, and members of his close family. During the year
the Company paid annual rental and property fees totalling £75,000 (2021: £75,000). There were no amounts owed
at the balance sheet date to these entities.

Krow Agency Ltd is contracted to pay annual rent to four individuals, including Dylan Bogg (Executive Director). During
the year, total rental of £74,000 (2021: £74,000) was paid and no amount was outstanding at the balance sheet date.

During 2021 seven directors received loans totalling £46,045 in respect of the personal tax payable on a growth
share award, as follows: Dylan Bogg £3,061; James Clifton £10,000; Julian Hanson-Smith £4,269; Giles Lee £10,000;
Sue Mullen £5,970; Andy Nash £2,746; Fiona Shepherd £10,000. All loans are repayable from the proceeds of the
growth share scheme or on termination of employment. No interest is being charged and all loans remain
outstanding at the year end.

Mark Lund, a Non-Executive Director, is also a director of Smart Energy GB, a company which is a Client of Livity
Ltd. Sales from Livity Ltd to Smart Energy GB at arms length subsequent to Mark becoming a director on 1 October
2022 amounted to £31,853. Included within trade debtors is £38,224 due from Smart Energy GB.

James Clifton, the Group Chief Executive, owns a 5% (2021: 5%) holding in Pathfindr Ltd.

30. Availability of Annual Report

Copies of the Annual Report for the year ended 31 December 2022 will be circulated to shareholders at least 21 days
ahead of the Annual General Meeting (“AGM”) on 20 June 2023 and, after approval at the AGM, will be delivered to the
Registrar of Companies. Further copies will be available from the Company’s registered office and on the Group’s
website, www.themission.co.uk

Independent Auditor’s Report
to the Members of The MISSION Group plc

Report on the parent company financial statements

Key audit matters

Opinion

We have audited the financial statements of The MISSION
Group plc (the 'Company') for the year ended 31 December
2022, which comprise the Company Balance Sheet,
Statement of Changes in Equity and the related notes,
including a summary of significant accounting policies.
The financial reporting framework that has been applied
in their preparation is applicable law and United Kingdom
Accounting Standards, including Financial Reporting
Standard 102 The Financial Reporting Standard applicable
in the UK and Republic of Ireland (United Kingdom
Generally Accepted Accounting Practice).

In our opinion the financial statements:

• give a true and fair view of the state of the company's
affairs as at 31 December 2022 and of its profit for the
year ended;

• have been properly prepared in accordance with
United Kingdom Generally Accepted Accounting
Practice; and

• have been prepared in accordance with the
requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are
further described in the Auditor’s responsibilities for the
audit of the financial statements section of our report.
We are independent of the company in accordance with
the ethical requirements that are relevant to our audit of
the financial statements in the UK, including the FRC’s
Ethical Standard as applied to listed entities, and we have
fulfilled our other ethical responsibilities in accordance
with these requirements. We believe that the audit
evidence we have obtained is sufficient and appropriate
to provide a basis for our opinion.

An overview of the scope of our audit

We planned and performed our audit by obtaining
an understanding of the Company and its environment,
including the accounting processes and controls, and
the industry in which it operates.

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) 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. These matters were
addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon,
and we do not provide a separate opinion on these matters.

The key audit matter identified for the company related
to the carrying value of its investments, given the company
holds material investments in subsidiary undertakings.
The company receives dividend income from its trading
subsidiaries. We reviewed and considered the level
of dividend income received from subsidiary companies
along with the ongoing ability for subsidiary companies
to generate distributable profits. Further detailed work
in respect of goodwill impairment in respect of the group’s
cash generating units is set out in our group audit report.

Our application of materiality

Misstatements, including omissions, are considered
to be material if individually or in aggregate, they
could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial
statements. We use quantitative thresholds of materiality,
together with qualitative assessments in planning the
scope of our audit, determining the nature, timing and
extent of our audit procedures and in evaluating the
results of our work.

Based on our professional judgement, we determined
materiality for the company financial statements should
be based on gross assets as it is a holding company.
This was restricted to 50% of group materiality
to give overall company materiality of £194,000
(2021: £186,500), performance materiality of £146,000
(2021: £140,000). Individual errors above £6,000
(2021: £6,000) were reported to the audit committee.

Annual report for the year ended December 2022

Financial Statements
Independent Auditor’s Report: Company

Conclusions relating to going concern

Matters on which we are required to report by exception

In auditing the financial statements, we have concluded
that the director's use of the going concern basis
of accounting in the preparation of the financial
statements is appropriate.

In the light of our knowledge and understanding of the
company and its environment obtained in the course
of the audit, we have not identified material misstatements
in the Strategic Report and the Directors' Report.

Based on the work we have performed (as set out in the
group audit report), we have not identified any material
uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt
on the company's ability to continue as a going concern
for a period of at least twelve months from when the
original financial statements were authorised for issue.

Our responsibilities and the responsibilities of the
directors with respect to going concern are described
in the relevant sections of this report.

Other information

The directors are responsible for the other information.
The other information comprises the information included
in the annual report, other than the financial statements
and our auditor’s report thereon. Our opinion on the
financial statements does not cover the other information
and, except to the extent otherwise explicitly stated
in our report, we do not express any form of assurance
conclusion thereon.

In connection with our audit of the financial statements,
our responsibility is to read the other information and,
in doing so, consider whether the other information
is materially inconsistent with the financial statements
or our knowledge obtained in the audit or otherwise
appears to be materially misstated. If we identify such
material inconsistencies or apparent material
misstatements, we are required to determine whether
there is a material misstatement in the financial
statements or a material misstatement of the other
information. If, based on the work we have performed,
we conclude that there is a material misstatement of this
other information, we are required to report that fact.

We have nothing to report in this regard.

Opinion on other matter prescribed by the Companies
Act 2006

In our opinion, based on the work undertaken in the
course of the audit:

• the information given in the Strategic Report and
Directors' Report for the financial year for which
the financial statements are prepared is consistent
with the financial statements; and

• the Strategic Report and Directors' Report have
been prepared in accordance with applicable
legal requirements.

We have nothing to report in respect of the following
matters where the Companies Act 2006 requires us
to report to you if, in our opinion:

• adequate accounting records have not been kept,
or returns adequate for our audit have not been
received from branches not visited by us; or

• the parent company financial statements are not
in agreement with the accounting records and
returns; or

• certain disclosures of directors’ remuneration specified

by law are not made; or

• we have not received all the information and

explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors'
Responsibilities set out on pages 40 and 41, the directors
are responsible for the preparation of the financial
statements and for being satisfied that they give a true
and fair view, and for such internal control as the
directors determine is necessary to enable the
preparation of financial statements that are free from
material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors
are responsible for assessing the 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 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.

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 company’s members,
as a body, in accordance with Chapter 3 of Part 16
of the Companies Act 2006. Our audit work has been
undertaken so that we might state to the company’s
members those matters we are required to state
to them in an auditor’s report and for no other purpose.
To the fullest extent permitted by law, we do not accept
or assume responsibility to anyone other than the company
and the company’s members as a body, for our audit work,
for this report, or for the opinions we have formed.

Duncan Leslie FCA
(Senior Statutory Auditor)

PKF Francis Clark
Statutory Auditor
Centenary House
Peninsula Park
Rydon Lane
Exeter
EX2 7XE

28 March 2023

We obtained an understanding of the legal and regulatory
framework applicable to the company and the industry
in which it operates. We identified the principal risks
of non-compliance with laws and regulations as relating
to breaches around GDPR. We also considered those laws
and regulations that have a direct impact on the
preparation of the financial statements such as financial
reporting legislation (including The Companies Act 2006),
distributable profits legislation and taxation legislation.
We considered the extent to which any non-compliance
with these laws and regulations may have on the
company’s ability to continue trading and the risk
of a material misstatement in the financial statements.

We also evaluated management’s incentives and
opportunities for fraudulent manipulation of the financial
statements and determined that the principal risks
related to the misstatement of the result for the year
and impairment of assets.

Based on this understanding we designed our audit
procedures to identify irregularities. Our procedures
involved the following:

• We made enquiries of senior management as to their

knowledge of any non-compliance or potential
non-compliance with laws and regulations that could
affect the financial statements. As part of these
enquiries we also discussed with management whether
there have been any known instances of material
fraud, of which there were none.

• We identified the individuals with responsibility

for ensuring compliance with laws and regulations
and discussed with them the procedures and policies
in place.

• We reviewed minutes of meetings of Senior Management

and those charged with governance.

• We challenged the assumptions and judgements made
by management in its significant accounting estimates.

• We audited the risk of management override of controls,

including through testing journal entries and other
adjustments for appropriateness, and evaluating the
business rationale of significant transactions outside
the normal course of business.

Annual report for the year ended December 2022

Financial Statements
Company Financial Statements & Notes

Company Balance Sheet
As at 31 December 2022

NON-CURRENT ASSETS

Intangible assets

Investments

Property, plant and equipment

CURRENT ASSETS

Debtors

CREDITORS: Amounts falling due within one year

NET CURRENT LIABILITIES

Note

TOTAL ASSETS LESS CURRENT LIABILITIES

CREDITORS: Amounts falling due after more than one year

NET ASSETS

CAPITAL AND RESERVES

Called up share capital

Share premium account

Own shares

Share-based incentive reserve

Profit and loss account

SHAREHOLDER’S FUNDS

As at
31 December
2022

£’000

As at
31 December
2021

£’000

1,296

114,596

965

116,857

10,653

(11,655)

(1,002)

115,855

(17,640)

98,215

9,102

45,928

(994)

886

43,293

98,215

1,430

114,596

851

116,877

9,952

(12,654)

(2,702)

114,175

(16,988)

97,187

9,102

45,928

(518)

828

41,847

97,187

The company made a profit of £3,717,000 for the year (2021: £4,103,000).

The financial statements were approved and authorised for issue on 28 March 2023 by the Board of Directors.
They were signed on its behalf by:

Giles Lee , Group Chief Financial Officer

Company registration number: 05733632

Company Statement of Changes in Equity
For the year ended 31 December 2022

At 1 January 2021

Profit for the year

Share option charge

Growth share charge

Shares awarded and sold from own shares

Dividend paid

Share
capital

Share
premium

Own
shares

Share-
based
incentive
reserve

Retained
earnings

Total
equity

£’000

9,102

45,928

(591)

582

234

40,190

95,211

4,103

234

(346)

(273)

(2,100)

At 31 December 2021

9,102

45,928

(518)

828

41,847

97,187

Profit for the year

Share option charge

Growth share charge

Own shares purchased

Shares awarded and sold from own shares

Dividend paid

(497)

3,717

(91)

(497)

(70)

(2,180)

At 31 December 2022

9,102

45,928

(994)

886

43,293

98,215

Annual report for the year ended December 2022

Financial Statements
Notes to the Company Financial Statements

31. Principal Accounting Policies

Financial assets and liabilities

All financial assets and liabilities are initially measured
at transaction price (including transaction costs), except
for those financial assets classified as fair value through
profit and loss, which are initially measured at fair value.

Financial assets and liabilities are only offset in the
statement of financial position when, and only when,
there exists a legally enforceable right to set off the
recognised amounts and the Company intends either
to settle on a net basis, or to realise the asset and
settle the liability simultaneously.

Debt instruments which meet the conditions to be
classified as basic instruments are subsequently
measured at amortised cost using the effective
interest method.

Basic debt instruments that are classified as payable
or receivable within one year are measured at the
undiscounted amount of the cash or other consideration
expected to be paid or received, net of impairment.

Financial liabilities are released to the profit and loss
account when the liability is extinguished.

Contingent consideration payments

The terms of an acquisition may provide that the value
of the purchase consideration, which may be payable
in cash or shares at a future date, depends on uncertain
future events such as the future performance of the
acquired company. The amounts recognised in the
financial statements represent a reasonable estimate
at the balance sheet date of the amounts expected to
be paid and has been classified in the balance sheet
in accordance with the substance of the transaction.
Revisions to estimated consideration payable year
on year are reflected in the value of the corresponding
investment. Where the agreement gives rise to an
obligation that may be settled by the delivery of
a variable number of shares to meet a defined monetary
liability, these amounts are disclosed as debt.

Investments

In the Company’s financial statements, investments
in subsidiary and associate undertakings are stated
at cost less provision for any impairment in value.

The principal accounting policies are summarised below.
They have all been applied consistently throughout the
year and to the preceding year.

General information and basis of accounting

The MISSION Group plc is a company incorporated
in England and Wales under the Companies Act. The
address of the registered office is given on page 105.
The nature of the Group’s operations and its principal
activities are set out in the Strategic Report on pages
2 to 11.

The financial statements have been prepared under the
historical cost convention, modified to include certain
items at fair value, and in accordance with Financial
Reporting Standard 102 (FRS 102) issued by the
Financial Reporting Council.

Reduced disclosure exemptions

The MISSION Group plc meets the definition of a qualifying
entity under FRS 102 and has therefore taken advantage
of the disclosure exemptions available to it in respect of its
financial statements. Exemptions have been taken in relation
to the presentation of a statement of comprehensive income,
cash flow statement, financial instruments, share-based
payment, share capital and remuneration of key
management personnel. The company made a profit
of £3.7m for the year (2021: £4.1m).

Deferred taxation

Deferred taxation is recognised on all timing differences
where the transactions or event that give the Company
an obligation to pay more tax in the future, or a right to
pay less tax in the future, have occurred by the balance
sheet date. Deferred tax assets are recognised when it is
more likely than not that they will be recoverable. Deferred
tax is measured using rates of tax that have been enacted
or substantively enacted by the balance sheet date.

Financial instruments

Financial assets and financial liabilities are recognised
when the Company becomes party to the contractual
provisions of the instrument.

Financial liabilities and equity instruments are classified
according to the substance of the contractual
arrangements entered into. An equity instrument is any
contract that evidences a residual interest in the assets
of the company after deducting all of its liabilities.

Accounting estimates and judgements

The Company makes estimates and judgements concerning
the future and the resulting estimates may, by definition,
vary from the actual results. The Directors considered the
critical accounting estimates and judgements used in the
financial statements and concluded that the main areas
of judgement are, in order of significance:

Potential impairment of investments

The potential impairment of investments is based on
estimates of future cash flows derived from the financial
projections of each cash-generating unit over an initial four
year period and assumptions about growth thereafter.

Contingent payments in respect of acquisitions

Contingent consideration, by definition, depends
on uncertain future events. At the time of purchasing
a business, the Directors use the financial projections
obtained during due diligence as the basis for
estimating contingent consideration. Subsequent
estimates benefit from the greater insight gained
in the post-acquisition period and the business’ track
record of financial performance.

Lease commitments

Rental costs under operating leases are charged against
profits as incurred.

Profit of parent company

As permitted under Section 408 of the Companies Act
2006, the profit and loss account of the Company is not
presented as part of these accounts.

Annual report for the year ended December 2022

Financial Statements
Notes to the Company Financial Statements

32. Intangible Assets

33. Investments

Other intangible assets

Cost

At 1 January 2021

Additions

At 31 December 2021

Additions

Adjustments to purchase consideration

At 31 December 2022

Amortisation and impairment

At 1 January 2021

Charge for the year

At 31 December 2021

Charge for the year

At 31 December 2022

Net book value at 31 December 2022

Net book value at 31 December 2021

Software
development
and licences

Customer
relationships

Goodwill

£’000

Total

£’000

1,171

520

1,691

(34)

1,743

132

129

261

186

447

608

289

897

(34)

863

897

1,296

1,430

502

231

733

819

129

200

186

386

433

533

Cost

At 1 January 2021

Additions

Adjustment to purchase consideration

At 31 December 2021

Additions

Adjustment to purchase consideration

At 31 December 2022

Impairment

At 1 January 2021

Impairment

At 31 December 2021

Impairment

At 31 December 2022

Net book value at 31 December 2022

Net book value at 31 December 2021

Shares in subsidiary undertakings

£’000

123,039

(8,443)

114,596

Additions of £86,000 (2021: £231,000) in the year include costs associated with the development of identifiable
software products that are expected to generate economic benefits in excess of the costs of development.

A list of the principal trading companies in the Group at 31 December 2022 can be found in Note 12 to the Consolidated
Financial Statements and a complete list can be found in Note 42.

Annual report for the year ended December 2022

Financial Statements
Notes to the Company Financial Statements

34. Debtors

37. Borrowings

31 December
2022

31 December
2021

31 December
2022

31 December
2021

Trade debtors

Amounts due from subsidiary undertakings

Corporation tax

Prepayments

Accrued income

Other debtors

35. Creditors: Amounts Falling Due Within One Year

Trade creditors

Bank overdraft

Amounts due to subsidiary undertakings

Accruals

Acquisition obligations

Other creditors

36. Creditors: Amounts Falling Due After More Than One Year

£’000

652

6,510

1,499

1,453

485

10,653

£’000

326

7,138

639

1,355

415

9,952

31 December
2022

31 December
2021

£’000

831

326

9,003

834

371

290

11,655

£’000

885

1,400

8,550

1,223

280

316

12,654

Bank loan outstanding

Adjustment to amortised cost

Carrying value of loan outstanding

The borrowings are repayable as follows:

Less than one year

In one to two years

In more than two years but less than three years

Adjustment to amortised cost

Less: Amount due for settlement within 12 months
(shown under current liabilities)

Amount due for settlement after 12 months

£’000

17,500

(60)

17,440

17,500

(40)

17,440

£’000

16,500

(107)

16,393

16,500

(107)

16,393

Details of the Company’s borrowing facilities and interest rates are set out in Note 19 and not therefore repeated here.
All borrowings are in sterling.

As at 31 December 2022, net assets of the Group were £90,175,000 (2021: £93,472,000) and net borrowings under this
Group arrangement amounted to £11,362,000 (2021: £10,327,000).

38. Share Capital and Own Shares

The movements on these items are disclosed within the Consolidated Financial Statements.

A description of Own Shares is disclosed in Note 23. During the year, the Company did not issue any new Ordinary
shares of 10p each (2021: no shares were issued) and at 31 December 2022, the number of shares in issue was
91,015,897 (2021: 91,015,897).

Bank loan (see Note 37)

Acquisition obligations

Deferred tax liability

£’000

17,440

200

17,640

£’000

16,393

430

165

16,988

Included in reserves at 31 December is unrealised profit, which is non-distributable, of £3,165,000 (2021: £3,165,000).

31 December
2022

31 December
2021

39. Unrealised Reserves

Annual report for the year ended December 2022

Financial Statements
Notes to the Company Financial Statements

40. Operating Lease Commitments

42. Group Companies – continued

The total minimum lease payments under non-cancellable operating leases are as follows:

31 December 2022

31 December 2021

Land and
buildings

£’000

286

899

581

1,766

Other

£’000

Land and
buildings

£’000

178

306

Other

£’000

Within one year

Between two and five years

In more than five years

41. Related Party Transactions

Details of related party transactions are disclosed in Note 29 of the Consolidated Financial Statements.

42. Group Companies

Below is a list of all companies in the Group. All subsidiaries are 100% owned and all are incorporated in the United Kingdom,
unless otherwise indicated. In addition, the Company holds an indirect interest in Destination CMS Ltd (50%), treated as a joint
venture. Unless otherwise stated, the registered office of all companies is The Old Sawmills, Filleigh, Barnstaple, EX32 0RN.

Subsidiary undertaking

Country of Incorporation

Registered office

Held directly:

The Mission Marketing Holdings Ltd **

Held indirectly:

April Six GmbH

April Six Inc.

April Six Ltd **

April Six (Mobility) Ltd **

April Six Proof Ltd **

April Six Pte. Ltd

Balloon Dog Ltd

Bastin Day Westley Ltd

Big Communications Ltd

Bray Leino Ltd **

Germany

USA

1/f, Rosental 7, Munich 80331, Germany

900 Kearny Street, Suite 700, San Francisco,
CA 94133, United States of America

Singapore

176 Orchard Road #05 - 05, The Centrepoint,
Singapore 238843

Subsidiary undertaking

Bray Leino Splash Ltd *

Bray Leino Splash Pte. Ltd

Bray Leino Splash Sdn. Bhd. *

Fox Murphy Ltd

Fuse Digital Ltd

Influence Sports Ltd **

Jellyfish Ltd

Joluxon Holdings Ltd **

Krow Agency Ltd **

Krow Communications Ltd **

Livity Ltd **

Mongoose Sports & Entertainment Ltd **

Pathfindr Ltd (80% owned) **

Populate Social Ltd **

RJW & Partners Ltd **

Robson Brown Ltd

Solaris Healthcare Network Ltd **

Soul (London) Ltd **

Spark Marketing Services Ltd
(formerly Mongoose Promotions Ltd) (75% owned) **

Speed Communications Agency Ltd **

Splash Interactive Ltd *

Splash Interactive *

Story Agency Ltd (formerly Chapter Agency Ltd) **

Story UK Ltd **

The Mission Ltd

The Splash Partnership Ltd **

ThinkBDW Ltd **

Country of Incorporation

Registered office

Hong Kong

Singapore

Malaysia

Unit 1101, 11/F, Tower 1, Cheung Sha Wan Plaza,
833 Cheung, Sha Wan Road, Lai Chi Kok, Kowloon,
Hong Kong

51 Tai Seng Ave, #04-04 Pixel Red, Singapore - 533941

No. 308, Block A (3rd Floor), Kelana Business Centre,
No. 97, Jalan 557/2, Kelana Jaya, 47301 Petaling
Jaya, Selangor Darul Ehsan, Malaysia

Vietnam

China

Suite 13-01 Pearl Plaza Offices 561A Dien Bien Phu
Ward 25, Binh Thanh District, HCMC, Vietnam

Room 1723, Raffles City Shanghai, 268 Middle Xizang
Road, Huangpu District, Shanghai, China

1-4, Atholl Crescent, Edinburgh, Scotland EH3 8HA

TMGPLC Asia Pte Ltd
(formerly Bray Leino Singapore Pte. Ltd)

Singapore

176 Orchard Road #05 - 05, The Centrepoint,
Singapore 238843

ThinkBDW Ltd **

Zonr Ltd (formerly Mission Marketing Ltd)

Bray Leino Productions Ltd **

Bray Leino Sdn. Bhd. *

Malaysia

100.6.04, 129 Offices, Block J, Jaya One. No. 72A,
Jalan Universiti 46200 Petaling Jaya, Selangor
Darul Ehsan, Malaysia

* These subsidiaries are 100% owned by Bray Leino Splash Pte. Ltd, which is 70% owned by The MISSION Group plc.

** These subsidiaries are exempt from the Companies Act 2006 requirements relating to the audit of their individual
accounts by virtue of Section 479A of the Act as The MISSION Group plc has guaranteed the subsidiary company
under Section 479C of the Act.

100

Annual report for the year ended December 2022

101

Additional information
Notice of Annual General Meeting

NOTICE is hereby given that the Annual General Meeting
(“AGM”) of The MISSION Group plc (the “Company”)
will be held at 12 noon on Tuesday 20 June 2023
at the offices of MISSION, 196 Tottenham Ct Rd,
London W1T 7LQ to transact the business set out below.

The following resolutions will be proposed
as ordinary resolutions:

Report and Accounts

1. To receive the financial statements and the reports
of the Directors and the auditors for the year ended
31 December 2022.

Dividend

2. To approve a final dividend of 1.67 pence per share

for the year ended 31 December 2022 to shareholders
on the register at the close of business on 14 July 2023,
payable on 28 July 2023.

Directors

3. To elect Mark Lund as a Director.

Auditors

4. To re-appoint PKF Francis Clark as auditors

of the Company.

5. To authorise the Directors to fix the remuneration

of PKF Francis Clark.

Authority to allot shares

6. THAT the Directors be and are hereby generally and
unconditionally authorised pursuant to Section 551
of the Companies Act 2006 (the “Act”) to exercise
all the powers of the Company to allot shares in the
Company and to grant rights to subscribe for, or to
convert any security into, shares in the Company up
to an aggregate nominal value of £3,033,863 being
one third of the issued share capital of the Company,
provided that this authority shall expire at the
conclusion of the next Annual General Meeting of the
Company after the passing of this resolution, save
that the Company shall be entitled to make an offer

or agreement before the expiry of such authority
which would or might require shares to be allotted
or any such rights to be granted, after such expiry
and the Directors shall be entitled to allot shares
or grant any such rights pursuant to any such offer
or agreement as if this authority had not expired and
all unexercised authorities previously granted to the
Directors to allot shares or grant any such rights be
and are hereby revoked provided that the resolution
shall not affect the right of the Directors to allot
shares or grant any such rights in pursuance of any
offer or agreement entered into prior to the date
of this resolution.

The following resolutions will be proposed
as special resolutions:

Authority to dis-apply pre-emption rights

7. THAT (subject to the passing of the resolution

numbered 6 above) the Directors be and are hereby
empowered pursuant to Section 570, Section 571
and Section 573 of the Act to allot equity securities
(as defined in Section 560 of the Act) for cash pursuant
to the authority conferred by resolution 6 above
as if Section 561 of the Act did not apply to any such
allotment, provided that this power shall be limited to:

the allotment of equity securities in connection with
a rights issue, open offer or other offer of securities
in favour of the holders of ordinary shares on the
register of members at such record date(s) as the
Directors may determine where the equity
securities respectively attributable to the interests
of the ordinary shareholders are proportionate
(as nearly as may be) to the respective numbers
of ordinary shares held by them on any such
record date(s), subject to such exclusions or other
arrangements as the Directors may deem
necessary or expedient to deal with treasury

iv. the authority hereby conferred shall expire at the
conclusion of the Annual General Meeting of the
Company held in 2024 or 18 months from the date
of this resolution (whichever is earlier); and

v. the Company may make any purchase of
its ordinary shares pursuant to a contract
concluded before the authority hereby conferred
expires and which will or may be executed wholly
or partly after the expiry of such authority; and

vi. all ordinary shares purchased pursuant to the
authority conferred by this resolution 8 shall
be cancelled immediately on completion of the
purchase or held in treasury (provided that
the aggregate nominal value of shares held
as treasury shares shall not at any time exceed
10 per cent of the issued share capital of the
Company at any time).

By Order of the Board

Giles Lee

28 March 2023

shares, fractional entitlements or legal or practical
problems arising under the laws of any overseas
territory or the requirements of any regulatory
body or stock exchange or by virtue of shares
being represented by depositary receipts or any
other matter whatever; and

ii. the allotment (other than pursuant to

sub-paragraph (i) above) to any person
or persons of equity securities up to an aggregate
nominal value of £910,158.97 being 10% of the
issued share capital of the Company.

This power shall expire upon the expiry of the general
authority conferred by resolution 6 above, save that the
Company shall be entitled to make an offer or agreement
before the expiry of such power which would or might
require equity securities to be allotted after such
expiry and the Directors shall be entitled to allot equity
securities pursuant to any such offer or agreement
as if the power conferred hereby had not expired and
all unexercised authorities previously granted to the
Directors to allot equity securities be and are hereby
revoked provided that the resolution shall not affect
the right of the Directors to allot equity securities
in pursuance of any offer or agreement entered into
prior to the date of this resolution.

Authority to purchase own shares

8. THAT pursuant to section 701 of the Act and subject
to, and in accordance with the Company’s Articles
of Association, the Company be generally and
unconditionally authorised to make market purchases
(within the meaning of Section 693(4) of the Act)
of ordinary shares of the Company provided that:

the maximum number of ordinary shares hereby
authorised to be acquired is 13,652,384 being
15% of the issued share capital; and

ii. the minimum price which may be paid for

an ordinary share is the nominal value of such
share; and

iii. the maximum price which may be paid for an

ordinary share is an amount equal to 105% of the
average of the middle market quotations for an
ordinary share in the Company as derived from
The London Stock Exchange Daily Official List
for the 5 business days immediately preceding
the day on which such ordinary share is contracted
to be purchased; and

102

Annual report for the year ended December 2022

103

Additional information
Notice of Annual General Meeting

Note to the Notice of Annual General Meeting

A member entitled to attend and vote at the Annual
General Meeting may appoint one or more proxies
(who need not be a member of the Company) to attend,
speak and vote on his or her behalf. A member may
appoint more than one proxy in relation to the meeting
provided that each proxy is appointed to exercise the
rights attached to different shares. To appoint as your
proxy a person other than the chair of the meeting,
insert their full name in the box on the Form of Proxy
accompanying the annual report. If you sign and return
the proxy form with no name inserted in the box, the chair
of the meeting will be deemed to be your proxy. Where
you appoint as your proxy someone other than the chair,
you are responsible for ensuring that they attend the
meeting and are aware of your voting intentions. If you
wish your proxy to make any commitments on your
behalf, you will need to appoint someone other than
the chair, and give them relevant instructions directly.
In order to be valid an appointment of proxy must be
completed, signed and returned in hard copy form by
post, by courier or by hand to Neville Registrars Limited,
Neville House, Steelpark Road, Halesowen, West Midlands
B62 8HD. The closing time for lodging proxies is 12 noon
on Friday 16 June 2023. For the purposes of determining
which persons are entitled to attend or vote at the
meeting, members entered on the Company’s register
of members at 6p.m. on Friday 16 June 2023 have the
right to attend and vote at the meeting.

CREST members who wish to appoint a proxy or proxies
through the CREST electronic proxy appointment service
may do so for the AGM and any adjournment thereof
by using the procedures described in the CREST manual.

CREST personal members who have appointed a voting
service provider(s) should refer to their CREST sponsor
or voting service provider(s), who will be able to take the
appropriate action on their behalf. In order for a proxy
appointment or instruction made using the CREST service
to be valid, the appropriate CREST message (a “CREST
Proxy Instruction”) must be properly authenticated
in accordance with Euroclear UK & International Limited’s
specifications and must contain the information required
for such instructions, as described in the CREST manual.
All messages relating to the appointment of a proxy
or an instruction to a previously appointed proxy must
be transmitted so as to be received by Neville Registrars
Limited (ID: 7RA11) no later than 12 noon on Friday 16 June
2023. Normal system timings and limitations will apply
in relation to the input of CREST Proxy Instructions.
It is therefore the responsibility of the CREST member
concerned to take such action as shall be necessary
to ensure that a message is transmitted by means
of the CREST system, and where applicable, their CREST
sponsor(s) or voting service provider(s) are referred,
in particular, to those sections of the CREST manual
concerning practical limitations of the CREST system
and timings. The Company may treat as invalid a CREST
Proxy Instruction in the circumstances set out in Regulation
35(5)(a) of the Uncertificated Securities Regulations 2001.

Advisors

Company Registration Number:

05733632

Registered Office:

Nominated Advisor:

Stockbroker:

Auditors:

Lawyers:

Registrars:

Company Secretary:

The Old Sawmills
Filleigh, Barnstaple
Devon, EX32 0RN

Shore Capital and Corporate Limited
Cassini House
57 St James’s Street
London, SW1A 1LD

Shore Capital Stockbrokers Limited
Cassini House
57 St James’s Street
London, SW1A 1LD

PKF Francis Clark
Statutory Auditor
Centenary House
Peninsula Park
Rydon Lane
Exeter, EX2 7XE

Shakespeare Martineau
No 1 1 Colmore Square,
Birmingham, B4 6AA

Neville Registrars
Neville House
Steelpark Road
Halesowen, B62 8HD

Michael Langford
The Old Sawmills
Filleigh, Barnstaple
Devon, EX32 0RN

Bankers:

NatWest Corporate & Commercial Banking
250 Bishopsgate
London, EC2M 4AA

104

Annual report for the year ended December 2022

105

The Old Sawmills, Filleigh,

Barnstaple, Devon, EX32 0RN

themission.co.uk