2024
Annual Report
and Financial Statements
Helping our customers
to do the right business
in the right way
Wilmington plc Annual Report and Financial Statements 2024
2
Contents
3
Strategic Report
3
Investment case
4
Financial measures and definitions
5
Headlines
7
At a glance
10
Strategy
13
Chair’s statement
14
Chief Executive’s review
17
Review of operations
19
Key performance indicators/
operational measures
21
Stakeholder engagement and
non-financial information statement
25
Sustainability report
43
Financial review
47
Risks and uncertainties facing
the business
56
TCFD disclosure
62
Viability statement
64
Our Governance
65
Board of Directors
67
Corporate Governance report
76
Audit Committee report
79
Nomination Committee report
81
Directors’ remuneration report
104 Directors’ report and other
statutory information
106 Statement of Directors’ responsibilities
107 Financial Statements
108 Independent auditor's report
124 Consolidated income statement
125 Consolidated statement of
comprehensive income
126 Balance sheets
127 Statements of changes in equity
129 Cash flow statements
130 Notes to the financial statements
174 Pro forma five year financial
summary (unaudited)
175 Advisors and corporate calendar
Our Governance Financial Statements
🏠 Strategic Report
Wilmington plc Annual Report and Financial Statements 2024
3
Investment case
Resilient portfolio in large and expanding
Governance, Risk and Compliance ('GRC') market
Purpose driven
We empower our customers to do
the right business in the right way, by
providing them with a complementary
range of information, and data and training
and education solutions via a single
technology platform. Our unique offering is
underpinned by a set of core competencies
that, in combination, drive sustainable
value creation for our shareholders.
Investment Case
Unique GRC platform
Powerful combination of well-
recognised international brands,
serving the resilient and growing
GRC market.
More than 29 years’ experience.
High conversion of
operating profit
into cash
Strongly cash generative business
reflected by by 116% (2023: 138%)
conversion of operating profit into cash.
116%
conversion of
operating profit
into cash
High proportion of
recurring revenues
Consistent and sustainable
revenue streams, with a focus
on recurring subscription and
membership revenues with high renewal rates.
36% (2023: 33%) of total revenue is subscription
and membership revenue.
36%
subscription and
membership
revenue
Commitment to
dividends
11.3p
total
dividend
Diverse and resilient
The resilience of our portfolio is enhanced by
a diverse international customer base and low
customer concentration.
Single technology platform and
digital innovation
Attractive portfolio of digital-first data and information
assets and innovative digital learning solutions, soon to
be delivered via a scalable single technology platform.
29+
years’
experience
Agile and customer led
Strong customer-led product management
culture, reinforced by agile approach to hybrid
delivery formats.
Responsible business culture
Commitment to customers echoed by the
responsible business culture embedded across
the Group.
Strategic Report
Our Governance Financial Statements
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Wilmington plc Annual Report and Financial Statements 2024
4
During the year there was one acquisition (Astutis), two business
disposals (European Healthcare & MiExact), one business classified
as held for sale (Compliance Week) and businesses
in Singapore and Malaysia were closed.
Throughout the Annual Report businesses are grouped in the following ways:
Measure
Definition
Organic revenue
Revenue excluding the impact of changes in foreign currency exchange
rates and also to exclude the impact of changes in the portfolio from
acquisitions and disposals. This is an adjusted measure.
Organic businesses include Bond Solon, Pendragon, Axco, FRA, Mercia,
CLTI and ICA.
Ongoing
Excluding the impact of businesses disposed, closed or held for sale.
Organic businesses listed above plus the acquisition, Astutis. This is an
adjusted measure.
Underlying
Defined as ongoing but excluding the impact of the acquisition, Astutis.
This is an adjusted measure.
Non-core
Businesses sold, held for sale, or closed including Compliance Week, ICA
Singapore & Malaysia, MiExact & European Healthcare. FY23 also includes
Inese results prior to disposal. This is an adjusted measure.
Adjusted results
Exclude amortisation of intangible assets (excluding computer
software), impairments, other income (when material or of a significant
nature) and other adjusting items. Adjusted results are reconciled to
statutory measures in note 2 to the financial statements. This is an
adjusted measure.
Statutory
continuing/
Continuing
operations/
Discontinued
operations
Statutory equivalent measures refer to continuing operations under IFRS
5, the measure includes all results apart from the European Healthcare
business because it has been classified as a discontinued operation under
IFRS 5, this statutory measure is different to our alternative performance
measure ‘ongoing’ as described above. When referencing this measure,
it’s referred to as ‘statutory continuing’ and in the notes to the financial
statements, it’s referred to as ‘continuing operations’ and European
Healthcare is referred to as a discontinued operation in line with IFRS 5.
These are statutory measures.
In this Annual Report reference is made to adjusted results as well as
the equivalent statutory measures. The Directors make use of adjusted
results, which are not considered to be a substitute for or superior to
IFRS measures, to provide stakeholders with a clearer understanding of
the Group’s performance, additional relevant information and enable an
alternative comparison of performance over time. Without the adjusted
measures, IFRS measures alone would not give a fair, balanced and
understandable view of the performance in the year – IFRS basic EPS
went up 102%, adjusted basic EPS went up 41%, IFRS PBT went up 17%,
adjuted PBT went up 13%. Readers of the accounts do not get a fair and
balanced view of the Group’s results by using IFRS measures alone.
COMPLIANCE WEEK
Financial measures
and definitions
Financial measures and definitions
Strategic Report
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Wilmington plc Annual Report and Financial Statements 2024
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Delivering
organic growth
We have delivered another strong year, in line
with our strategy with notably strong increases
in revenues, profits and cash generation. Margins
have also continued to improve strongly.
We continued to focus on consolidating our
already strong presence in the large, growing
and rapidly evolving international GRC markets
and significantly enhanced our capabilities with
the acquisition of Astutis in the Health, Safety
and Environment ('HSE') sector. We sold our
European Healthcare businesses and MiExact.
We now have a higher quality portfolio of
growing international businesses and continue
to pursue various opportunities to invest
in acquisitions to improve our growth and
profitability. We have also started to transfer our
businesses onto our single operating platform,
which will continue to improve our performance.
We have had a good start to the current
financial year, with revenues and profits in
line with expectations.
Mark Milner
Chief Executive
2024
2023
Change
Ongoing results1
Revenue
£89.7m
£78.7m
14%
Adjusted PBT2
£24.1m
£16.9m
42%
Adjusted PBT margin
26.8%
21.5%
25%
Adjusted basic EPS3
19.81p
14.02p
41%
Total results
Net cash4
£67.8m
£42.2m
61%
Total dividend
11.3p
10.0p
13%
Total adjusted PBT
£27.6m
£24.3m
13%
Total adjusted
PBT margin
22%
20%
11%
Total basic EPS
46.32p
22.94p
102%
Statutory
continuing results
Revenue
£98.3m
£93.1m
6%
PBT
£24.2m
£20.5m
17%
Basic EPS
19.33p
19.51p
(1%)
Financial performance
•
14% revenue growth from ongoing businesses.
Organic growth of 9%. All ongoing businesses grew.
•
Annual recurring revenues up 16%, now 36% (2023:
33%) of Group organic revenues, despite the sale of
subscription-heavy businesses.
•
Adjusted profit before tax from ongoing businesses
up 42% to £24.1m (2023: £16.9m) Total adjusted
profit before of £27.6m (2023: £24.3m).
•
Total adjusted PBT margin up to 22% from 20%.
Operating margins of ongoing businesses continue to
increase.
•
Dividend increased by 13% to final dividend of 11.3p.
•
Robust balance sheet with net cash at 30 June 2024
£67.8m (2023: £42.2m) reflecting strong trading
performance and cash conversion as well as the net
cash received from portfolio changes.
•
Continued to enhance and streamline portfolio with
acquisition of Astutis, and disposals of European
Healthcare & MiExact businesses.
•
Investment in the development of single technology
platform for the whole business.
Headlines
1. Ongoing – eliminating the effects of the impact of disposals, closures and businesses held for sale;
Organic – Ongoing, eliminating acquisitions and exchange rate fluctuations.
2. Ongoing adjusted profit before tax and total adjusted profit before tax – see note 2.
3. Ongoing adjusted basic earnings per share – see page 44; Adjusted basic earnings per share – see note 9.
4. Net cash includes cash and cash equivalents, bank loans (excluding capitalised loan arrangement fees) and bank
overdrafts but excludes lease liabilities.
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Headlines continued
2020 2021 2022 2023 2024
113.0
121.0
122.1
126.0
123.5
Total revenue for the year5 £’m
£126.0m
+2%
Organic revenue growth %
9%
2023: 13%
14.0
16.6
21.6
25.6
24.1
2020 2021 2022 2023 2024
Total adjusted EBITA £’m
£25.6m
+6%
Total adjusted profit before
tax margin %
20%
2023: 20%
11.9
15.0
20.7
27.6
24.3
2020 2021 2022 2023 2024
Total adjusted profit before tax £’m
£27.6m
+13%
Total profit before taxation £’m
£48.5m
2023: £24.0m
10.71
13.62
18.66
22.96
21.49
2020 2021 2022 2023 2024
Total adjusted earnings
per share p
22.96p
+7%
Total basic earnings
per share p
45.92p
2023: 22.94p
nil
6.0
8.2
10.0
11.3
2020 2021 2022 2023 2024
Total dividend p
11.3p
+13%
Final dividend p
8.3p
2023: 7.3p
(27.7)
(17.2)
20.5
42.2
67.8
2020 2021 2022 2023 2024
Group net cash/(debt)
(excluding lease liabilities) £’m
£67.8m
+61%
Strong cash conversion6 %
116%
2023: 138%
5. Measures referred to as 'Total' include discontinued operations.
6. Cash conversion - see note 27.
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Wilmington plc Annual Report and Financial Statements 2024
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v
HSE
Legal
Financial
Services
At a glance
Effectively navigating the
Regulatory Compliance landscape
Wilmington is a scalable platform operating in the resilient and
expanding GRC market, providing solutions to enterprise customers
and professionals from a broad range of industries.
Our customers operate within a complex array of legal, political, and
regulatory frameworks, all dictated by the ever-evolving compliance
landscape. We help them to navigate this complexity and respond
to emerging areas of risk by providing a complementary range of
solutions which are delivered via a single technology platform.
Our intelligence gives customers the detailed insight they need
to understand the regulatory landscape, and our specialist training
equips them to navigate it successfully.
Our solutions are focused on real-world outcomes and are based on
significant and defendable intellectual property built up over many
years. Our teams of experienced industry practitioners and talented
subject matter experts are central to our unique offering. We are
proud to be recognised by our customers as a trusted and valued
partner as we help them navigate their business challenges.
Wilmington is a digital-first business with strong capabilities in
online and hybrid learning, and in the management and provision of
mission-critical information and data. The strength of our portfolio
is underpinned by an operating model which allows our portfolio of
businesses to leverage the value of the Group’s technology platform
to deliver unique solutions to their customers. We invest in the
core competencies that drive quality in our products to enable our
businesses to exhibit a unique set of characteristics that define our
competitive advantage.
Empowered Customers
Doing the right business in the right way accross Governance Risk and Compliance (GRC)
Single
technology
platform
Regulation
Compliance
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Underpinning the GRC market
with strong growth drivers
The GRC markets are underpinned by strong macro
drivers, which are closely aligned to the Group’s core
offering and inform our strategy to increase brand
presence in this market:
•
Increasing volume of regulation;
•
Increasing fraud and cyber risk;
•
Evolving role of compliance;
•
Escalating regulatory enforcement;
•
Increasing importance of responsible business practice;
•
Increasing adoption of technology solutions; and
•
Complex geopolitical landscape.
The products that Wilmington offers focus on three main
sub-categories of Governance, Risk and Compliance:
Governance
• Conduct • Ethics
• Corporate Governance
• Risk Management
Architecture
• Operational Resilience
Compliance
• Financial Crime Prevention
• AML & CTF • Sanctions • Anti-bribery
& Corruption • Fraud • Information &
Data Security • Market Abuse/Insider
Trading • Cyber-crime • Conduct of
Business • Healthcare Regulations
• Diversity, Equity & Inclusion
Risk
• Prudential
• Information Sharing
• Risk Management
• Reputational Risk
GRC
At a glance continued
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At a glance continued
Business focus
Our businesses provide must-have, authoritative risk and compliance data to financial services and
legal sectors, and compliance training and technical support for customers in financial services, legal
and health, safety and environment (‘HSE’) sectors.
The information and data solutions provided by our brands, Axco and Pendragon, represent the gold
standard in accuracy and timeliness, and this capability is enhanced by the expertise of our research
analysts and industry practitioners, to ensure that we provide actionable insight to customers.
Much of our data is developed by our own teams, and we own the associated intellectual property.
We offer a wide product range of compliance training and technical support, including formal
qualifications, continuing education, and mandatory training, through instructor-led and self-guided
formats. Our excellence in this area is underpinned by world-class and engaging course content,
developed in house by our team of experienced subject matter experts, and enhanced by Wilmington’s
strong digital subscription management and dynamic delivery platform. Our brands/businesses are:
ICA, CLTi and Mercia in Financial Services, Astutis in HSE, Bond Solon in Legal and FRA in Insurance.
Please see the Review of operations on page 17 for further details.
We operate as one Group,
focused on global GRC
markets, moving towards a
single technology platform,
supporting multiple
market-facing businesses.
One
GRC focus,
multiple
markets
Revenue analysis
Revenue can be analysed by segment as follows:
Statutory Continuing Revenue
2024
2023
Health, Safety & Environmental
5%
n/a
Legal
16%
15%
Financial Services – Insurance
29%
30%
Financial Services - Other
41%
40%
Non-core
9%
15%
Revenue can be analysed by geography as follows:
Statutory Continuing Revenue
2024
2023
UK
53%
53%
USA
26%
26%
Europe
11%
11%
Rest of the World
10%
10%
Our brands
COMPLIANCE WEEK
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Unique GRC
solutions
Wilmington’s streamlined operating
model is increasingly underpinned by the
roll-out of a single technology platform,
and its success is driven by the synergistic
potential of its unique portfolio of
brands. We are continuing to achieve our
strategic objective of delivering organic
growth, and to cement our position in
the large and growing GRC markets by
investing in operational efficiencies and
in the core competencies that drive our
competitive advantage.
Grow
Generate growth and cement
our position in the GRC market
Invest
Invest in our businesses to facilitate
new product development,
provide innovative solutions to our
customers, and fuel growth
Manage
Manage our portfolio to ensure
that all businesses exhibit the
unique characteristics that drive
our competitive advantage
Strategy
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2. A focus on the GRC sector
Following our strategy review in 2021, all our businesses now operate in the
Governance, Risk and Compliance sector, providing data and training in areas
focused on:
•
Financial services, including retail banking, investment banking, private
equity, insurance, pensions
•
Legal services, providing training in areas of law to non-lawyers, including
Expert Witness training, Witness Familiarisation, Health & Social Care
regulatory training, Investigations training
•
Health, Safety and Environment training
1. Digital Capabilities and data enabled
Our digital-first model demonstrates best in class digital capabilities including:
•
Delivery platform agnostic
•
Excellence in User Experience (‘UX’) and User Interface (‘UI’) solutions
Our businesses are data enabled, allowing them to provide unique insight and
innovative solutions to their customers, driven by:
•
Efficient data collection, accurate measurement, integration and analysis,
supported by dynamic user interfaces
•
Proprietary data and bespoke services
Wilmington characteristics: what makes us unique
By drawing on our core competencies we have embedded a set of defining characteristics into all of our brands which, in combination, drive progress against our three
integrated strategic objectives.
3. Differentiated offering
Our businesses occupy strong positions in the markets they serve, exhibited via
the following credentials:
•
Market leaders – within the top three
•
Unique products with owned IP
•
Strong brands valued highly by customers
4. Attractive markets
The markets in which we operate present opportunities for sustained growth:
•
Fit with Wilmington’s core markets
•
Fit with a growing end-user base in which our solutions are integrated into
customer systems
5. Strong product and revenue model
Our product and revenue model drives value by targeting the following actions:
•
Identifying attractive opportunities
•
Prioritising repeatable revenue streams
•
Leveraging success across the portfolio to maximise the benefit
of synergistic potential
6. Strong leadership
Our businesses are led by individuals who are best placed to accelerate
their growth, evidenced by their core competencies:
•
Experts in their field, aligning sector specific knowledge to product
development and delivery
•
Innovators seeking to embrace change to deliver bespoke customer solutions
Strategy continued
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Delivering
growth
Our organic growth strategy has continued to
deliver by embedding the unique combination of
characteristics that define our competitive advantage
in each of our brands. Applying a common framework
across the Group, we have focused our investment
efforts in two main areas: operational excellence
and a single technology platform. These efforts
have continued to be informed by our commitment
to a responsible business culture across the Group,
supporting our people to make decisions in a way
that delivers long term value. Full details of the
progress we have made against our sustainability
strategy objectives during the year are outlined in
the Sustainability report on pages 25 to 42.
Investment focus:
Operational excellence
Over the past four years we have invested heavily
in operational excellence to accelerate our growth
ambitions. We have sought to apply a best-in-class
approach to managing technology and data, sales
and marketing, talent, and product development
across our Group. This work includes the investments
we have made across all aspects of employee
experience and helps ensure that we are attracting
and developing the diverse, talented workforce that
is central to our ongoing success.
Investment focus: Developing
a single technology platform
In addition to our People strategy, the investments
we made in operational excellence focused
heavily on enhancing our product, technology,
and data capabilities, as the key mechanisms to
deliver high quality solutions to our customers.
This year has seen very strong progress
towards our goal of establishing a single
technology platform for the Group.
Investment focus:
Future progress
Our ongoing investment in operational
excellence and the single technology
platform is at the heart of our plan to
ensure that Wilmington continues to
demonstrate the agility to adapt and
grow, both organically and through
acquisition, as customer demands
evolve and new market opportunities
arise. By embedding common
infrastructure and processes,
the Group is well placed to
effectively enhance and
expand its unique offering.
Strategy continued
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The Group has achieved revenue growth from its
ongoing businesses of 14%, organic revenue growth
of 9%, with recurring revenue1 up 16%. This growth
represents our continued focus on operational
performance resulting in increased profit, which
in turn has allowed us to increase our dividend
payments in line with profits with a proposed final
dividend of 8.3p (2023: 7.3p), resulting in a total
dividend for FY24 of 11.3p (2023: 10.0p) up 13%.
We have continued to strengthen our balance sheet,
with an increase in our net cash position as a result
of the conversion to cash of these higher profits and
the strategic disposal of the European Healthcare
and MiExact businesses, offset by the acquisition of
Astutis. We also continue to invest in the technology
that powers the delivery of our products and services.
This technology is financed by our operational
cash flow.
Once again, I would like to thank our talented teams
of people for their hard work which has enabled us to
deliver our strategy and the strong financial results
associated with it.
Paul Dollman, who has been a Non-Executive
Director, as well as Audit Committee Chair and Senior
Independent Director for nine years, retires from the
Board in October this year. I would like to thank Paul
for his outstanding contribution to Wilmington and
wish him well for the future. Sophie Tomkins joined
the Board as a Non-Executive Director in April and
will succeed Paul as Audit Committee Chair when
he retires on 08 October 2024. Helen Sachdev will
succeed Paul as Senior Independent Director on
08 October 2024.
Current trading and outlook
Trading has been encouraging in the first quarter, with
revenues and profits in line with expectations.
Martin Morgan
Chair
08 October 2024
I am pleased to present the Annual Report for the year ended 30 June 2024. Once again,
we are successfully executing on our strategy which has resulted in strong underlying
revenue and profit growth. This year we have also made a notable acquisition to enhance
future growth in both measures.
Chair’s statement
1. Recurring revenue – those contracted at least one year ahead.
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Chief Executive’s review
Overview
We are pleased to report another year of good progress and delivering on our strategy
with notably strong increases in revenues, profits and cash generation. We continued to
focus our portfolio of businesses on the international Governance, Risk and Compliance
('GRC') markets and significantly enhanced our capabilities with the acquisition of Astutis
in the Health, Safety and Environment ('HSE') sector. We sold our European Healthcare
businesses and MiExact.
We also continued to invest in our operational
growth levers, sales, marketing, product
development and have moved decisively towards
running all our operations on a single platform, by
merging the previous platforms built for training
and data operations. During the year, following the
disposal of the businesses that made up the majority
of our Intelligence division, we have reorganised our
segmental reporting around the external markets
addressed by our brands from Training & Education
and Intelligence to HSE, Legal and Financial Services.
Results
For the year ending 30 June 2024, the Group saw
overall organic revenue growth of 9%, with solid
growth from all our ongoing businesses. We also
achieved 16% growth in Group recurring revenues,
making up 36% of total revenues (2023: 33%). We
have achieved organic revenue growth every year in
the last four financial years.
The increased revenues and a continued focus on
operational efficiency resulted in total adjusted
PBT growth of 13% to £27.6m (2023: £24.3m)
and a corresponding improvement in adjusted PBT
margin to 22% (2023: 20%). We have also achieved
this profit growth over the last four years, despite
selling or closing seven of the 15 businesses in the
Group in 2020.
Profits from underlying operations (excluding the Astutis
acquisition) were up 35%, driven by strong trading in our
Financial Services businesses and net interest income on
our cash of £2.0m. This resulted in underlying adjusted
basic earnings per share being up 33%, which in turn
has allowed us to propose an increase in dividend to a
final dividend of 8.3p (total of 11.3p).
Statutory revenue was up 6% to £98.3m (2023:
£93.1m). Statutory PBT was up 17% to £24.2m
(2023: £20.5m). Total Basic EPS increased to 46.32p
(2023: 22.94p).
The Group again strengthened its balance sheet,
increasing its net cash position (excluding lease
liabilities & including cash held for sale) to £67.8m
(2023: £42.2m) after another strong year of
converting profits to cash as well as the net cash
received from portfolio changes. We have also
significantly reduced our future lease liabilities by
downsizing office footprints, including exiting our
London offices. This will provide significant cost
savings going forward and better complement our
hybrid working policy, which has resulted in a need
for far less office space.
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Strategy
Our strategy is delivering, so there is no change
here. We continued to focus on consolidating our
already strong presence in the large, growing and
rapidly evolving international GRC markets. These
markets are underpinned by strong macro drivers,
particularly the increasing volume and enforcement
of regulation, complex geopolitical landscape,
increased importance of ESG and widespread
adoption of technological and data-driven
compliance solutions, all of which align strongly to
Wilmington’s core offering.
At the heart of this focus on the GRC markets
is our ambition to help our customers to do the
right business in the right way, by providing a
complementary range of information & data and
training & education solutions. Our businesses focus
on the financial services, legal and HSE markets.
We are looking to acquire further businesses in these
and complementary sectors.
Portfolio update
In November 2023, we completed the acquisition
of Astutis, a training business offering a range of
globally recognised and regulated health, safety
and environmental qualifications, based in Cardiff.
The business has achieved strong growth in the
growing HSE market and is highly complementary
to our existing portfolio. The acquisition of Astutis
is consistent with our strategy in the GRC market
to broaden and strengthen our training and
education capabilities.
We continue to review all parts of the Group
assessing businesses against six key characteristics:
organic growth opportunities; attractive markets;
digital and data capabilities; strong leadership;
strategic fit to the GRC marketplaces; and attractive
product, revenue, and profitability characteristics.
As part of this ongoing review, we determined that
our Healthcare, Compliance Week and MiExact
businesses no longer met our criteria. MiExact,
a UK mortality data business, and the European
Healthcare business were sold during the year,
Compliance Week is in a sale process. We also
closed our operations in Singapore and Malaysia
due to continuing declining revenues, ongoing
losses and little prospect of recovery given the local
market conditions. We now serve the Singapore and
Malaysia markets from the UK.
We continue to seek businesses to join the Group,
with a highly active but disciplined M&A function
exploring many options. To date, we have identified
numerous businesses which meet our required
characteristics. However, valuation expectations
continue to remain high and we continue to take
a very disciplined approach. Our priority is to
allocate the capital available to us, including our
cash balance, cash we generate from our profitable
operations, and our borrowing capability, to
acquisitions in the next two years.
Investment
Our investment approach across the Group
continues to be targeted at embedding the unique
characteristics that define our competitive advantage
into each of our brands. We are pleased with the
progress we have made in developing a single
technology platform for our businesses, by merging
our previous platform investments and removing
more of our legacy technology debt. We have
more work to do to achieve a single platform for
everything we do but the building blocks are in place
and should deliver operational efficiencies in FY25 as
expected. The implementation of a single platform
will also allow us to efficiently expand our offering
by creating a scalable portfolio to enhance our
growth potential.
We continue to invest organically in new products
and strengthen our existing product offerings,
with the scope to monetise our solutions greatly
enhanced by our single platform approach. This
strategy for maximising the value of our technology
and data assets, combined with our streamlined
operating model, provides the strong base to actively
consider acquisition targets which complement
and/or extend our capabilities.
We reported last year that within the strategic
framework of Wilmington, deliberate measures
are being put into action to navigate the risks that
accompany AI technology while simultaneously
harnessing its opportunities. Work continues to
mitigate risks and incorporate AI into our products.
We also remain focused on investing in the
many drivers of employee engagement, which
increased year on year as measured by our annual
engagement survey. Development is actioned by
activities such as regular Town Halls, the building
and support of communities, and development of
Working Groups to focus on keys areas such as
diversity and inclusion, reward strategies, talent
development and others.
Chief Executive’s review continued
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Responsible business
We are committed to investing in the initiatives that support our
colleagues and our own responsible business culture.
We continue to make significant progress with our People Strategy,
more details of which can be found on pages 27 to 35. Our people
make our business, and our continued success in this financial year
is down to their hard work, ingenuity, skills and expertise, and I
thank everyone for their commitment to Wilmington.
We have achieved progress against our targets in all four areas
of our sustainability strategy, and this work continues to underpin
our broader strategic objectives and risk management processes.
Full details of this work can be found in our Sustainability report.
We implemented the Taskforce for Climate-related Financial
Disclosures ('TCFD') recommendations in full two years ago,
while still putting together some further detail on the metric
requirements. We concluded that we must continue to monitor
the impacts of climate change on the Group’s risk profile, but that
the potential opportunities that may arise from the transition to a
low-carbon economy are well aligned to our core offering. We have
committed to net-zero carbon targets, with an ambition of absolute
zero, producing no greenhouse gas emissions, in respect of Scope 1
and 2 emissions by 2028, and net zero in respect of Scope 3
emissions by 2045.
Mark Milner
Chief Executive
08 October 2024
Chief Executive’s review continued
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17
2024
£’m
2023
£’m
Absolute
variance
%
Organic1
variance
%
Revenue
HSE2
4.8
Legal3
16.0
14.0
14%
14%
Insurance
28.8
27.8
3%
6%
Other
40.1
36.9
9%
9%
Financial Services4
68.9
64.7
6%
7%
Ongoing revenue
89.7
78.7
14%
9%
Ongoing
operating profit
28.1
21.9
28%
24%
Margin %
31%
28%
Total revenue5
126.0
123.5
2%
Total operating profit
31.6
29.3
8%
Astutis features for the first time so has no variances
on last year, and the numbers are for a partial year.
The business grew significantly on its prior year
performance.
Group operating profits improved by 24% organically
and operating margins for ongoing businesses
increased to 31% on the back of the revenue
increases and continued cost improvements.
Segmental reporting
Following the acquisition of Astutis, a training
business in the HSE sector and the disposal of the
European Healthcare and MiExact businesses and the
decision to sell Compliance Week, which together
made up the majority of what was previously our
Intelligence Division, we have reorganised our
segmental reporting around the external markets
addressed by our brands.
HSE
The HSE segment comprises Astutis, acquired in
November 2023. Astutis is a UK training business
which mixes face-to-face and online learning
for various industry standard qualifications and
certificates in the HSE sector. The business has
experienced strong growth in recent years after
switching focus to more online training post-Covid and
has a strong market position in a growing marketplace.
Legal
The Legal segment comprises Bond Solon and
Pendragon, whose customers are predominantly
in the legal market. Bond Solon is mainly UK based
and trains individuals involved in the legal system,
including lawyers, helping them train their clients for
interaction with the legal system. Revenue is earned
through one off course attendance fees. Courses are
typically single or half day events, and content is a
mix of owned and third-party intellectual property.
Courses are delivered either by in-house experts or
a network of independent tutors who are paid per
course. The Law for Non-Lawyers market is strong,
with good ongoing demand for existing products as
well as successful launches of new training courses.
Pendragon operates in the UK pensions market,
providing information products and services with
revenues generated primarily through subscription.
Legal revenues grew 14% organically, led by Bond
Solon which had a significant contract win in the
public sector to give it a second consecutive year of
double-digit revenue growth. Pendragon had a strong
year for subscription revenue growth and again
achieved very strong customer retention (99%).
Financial Services
Financial Services Insurance comprises Axco and
FRA. Axco provides a broad range of information
products and services with revenues generated
primarily through subscription, and customers are
spread globally.
FRA is predominantly events based. It serves the
US Healthcare and Health Insurance markets and,
to a lesser extent, the US financial and legal service
communities. The prime brand is the RISE series of
events that addresses the Medicare and Medicaid
markets and is attended by health plans, physician
groups and solution partners. The flagship event is
RISE National which normally takes place in March
each year. Revenue from the US events is generated
from both sponsorship and delegate sales.
Review of operations
1. Ongoing – eliminating the effects of the impact of disposals, closures and
businesses held for sale; Organic – Ongoing, eliminating acquisitions and
exchange rate fluctuations.
2. The HSE division consists of the Astutis business.
3. The Legal division consists of the Bond Solon and Pendragon businesses.
4. The Financial Services division consists of Axco & FRA in the Insurance
subdivision and Mercia, CLTi & the ICA businesses within the Other
subdivision.
5. Total revenue & operating profit includes all results in the Group including
non-core businesses consisting of MiExact, Compliance Week, Healthcare,
APM, ICA Singapore & Malaysia. Non-core in FY23 also includes Inese.
Group performance
Revenues from ongoing businesses grew 14%, 9%
excluding currency gains and the Astutis acquisition.
All eight of the ongoing businesses grew organically
and recurring subscription revenues grew 16%.
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18
Financial Services Other comprises three
businesses that operate in Compliance
markets. The largest business, which was
developed organically within Wilmington, is the
International Compliance Association ('ICA').
It is an industry body and training business
that was created in 2002. It offers professional
development and support to compliance
officers predominantly in the financial services
sector. It has offices in the UK and Dubai,
and a presence in India.
The material for ICA courses is developed
by our own internal R&D team, and external
specialists. We own the associated intellectual
property. Revenue earned by ICA is primarily
training income complemented by subscriptions
paid by the professional members for their ICA
accreditations. The courses ICA run usually
extend over several weeks or even months.
They traditionally mix distance learning with
face-to-face sessions. The distance learning
element has transitioned to online and digital
variants, and virtual programmes have been
offered in place of face-to-face sessions.
The second business, CLTi, earns revenue from
running professional development programmes
for wealth managers, in association with
The Society of Trust and Estate Practitioners.
Wilmington has an international presence,
with customers in the UK, Europe, Asia
Pacific and the US. Our consistent investment
programme in content and technology is
maintaining our competitive positioning.
The third business, Mercia, provides training
for accountants in practice and in business.
It runs a mix of face-to-face, online, and blended
learning for this community. It provides training
at various levels including providing continuing
professional development for existing qualified
accountants. Additionally, it provides technical
support to accountancy firms which enables
them to keep abreast of technical developments
and changes to regulation, as well as supporting
them to promote the services they then offer
to their clients.
Mercia is predominantly UK and Ireland
based reflecting the country specific laws and
accounting standards that govern the profession.
Revenue in the unit is earned through clients
subscribing for ongoing training, support and
other related activities over a period of time
(usually 12 months), with the rest through one
off course attendance fees. Courses are typically
single or half day events, and content is a mix
of owned and third-party intellectual property.
Courses are delivered either by in-house experts
or a network of independent tutors who are paid
per course that they deliver.
Financial Services Other, overall revenues grew
9%. CLTi and ICA UK and Middle East revenues
were up by double digit percentage points. ICA
saw continued revenue decline in Singapore
and Malaysia and the business there became
loss‑making. Without any sign of a return
to profit or revenue growth in the near future
we took the decision to close our operations
in Singapore and Malaysia and to service
the area from the UK. Mercia revenues grew
4% in the year and significantly improved its
recurring revenues.
Review of operations continued
Ongoing revenue grew
14% and ongoing
operating profits 24%
Financial Services
continued
Financial Services Insurance
revenues grew 6% overall.
Axco grew revenues by 7%,
excluding currency gains,
and had a strong year for
subscription revenue growth.
Recurring revenue retention
rates were at 99%. FRA
revenues were flat in sterling
terms but grew 4% in US
dollars, delegate revenues were
again strong.
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19
1
Organic revenue growth %
Definition and purpose
Calculated by adjusting the year-on-year revenue change to exclude the
impact of foreign currency exchange rate fluctuation and the impact of changes
in the portfolio from acquisitions and disposals.
This measure is used as it gives a comparable assessment of the growth of the business and
of its sustainability. Monitoring organic revenue growth also allows the Board to assess whether
action is needed to control other aspects of the Group’s financial performance such as managing
the cost base. Please refer to the Review of operations on pages 17 to 18 for a reconciliation.
Result
Increased by 9% (2023: 13%). We have also delivered 16% growth in recurring
revenue, which now represents 36% of organic revenue (2023: 33%), despite the sale of
subscription‑heavy businesses.
Key performance indicators/operational measures
Key performance indicators
and operational measures
At a Group level, we have five key financial and
operational measures
Throughout the Annual Report there is reference to the metrics set out below, which serve as
alternative performance measures. The KPIs below are all based on alternative performance
measures. Where adjusted measures are used in the report they are clearly presented and
specifically used to provide a balanced view of the Group and its performance. The Directors
believe that these measures, which are not considered to be a substitute for or superior to
IFRS measures, provide stakeholders with additional relevant information and enable an
alternative comparison of performance over time.
Definition and purpose
Calculated as profit before tax excluding the impact of changes
in the portfolio from disposals, amortisation of intangible assets
excluding computer software, impairments, other income (when it
is material or of a significant nature), and other adjusting items. This
measure is considered to reflect profitability of the Group before
adjusting items and is a key metric used to determine management
incentives, including within the Directors’ bonus targets as set out
in the Remuneration report. The Group policy on adjusting items
and the calculation of adjusted PBT are set out respectively in notes
1 and 2 of the financial statements. Amortisation of intangible
assets excluding computer software are excluded from adjusted
PBT as they relate to historical acquisition activity rather than
the organic trading performance of the business. This approach
provides management with comparable information for day-to-day
decision making.
Result
Increased by 42% to £24.1m (2023: £16.9m) reflecting increased
revenues and a focus on operational efficiency and cost management.
Underlying adjusted PBT defined as ongoing PBT excluding the
impact of acquisitions increased by 35% to £22.9m (2023: £16.9m).
2
Ongoing adjusted profit before tax
(‘adjusted PBT’) £’m
0
5
10
15
20
25
6.4
7.3
11.3
2020 2021 2022 2023 2024
16.9
24.1
£24.1m
+42%
9%
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Key performance indicators/operational measures continued
4
Cash conversion %
Definition and purpose
Cash conversion represents the
operating cash flow for the year as
a percentage of adjusted operating
profit before interest and amortisation.
This measure is used as an indicator
of successful stewardship of cash
resources and corroboration of the
quality of operating profits compared
to the associated cash flow. Please
refer to note 27 for a reconciliation.
Definition and purpose
The Group continues to focus on a portfolio of assets based in key
professional markets, facilitated by excellence in technology and data
and dynamic sales and marketing. The development of a dynamic
product portfolio has driven the Group’s ambition to secure sustainable
revenue streams, with multi-year and subscription packages sold for
many revenue streams, including:
•
data, information, intelligence and solution sales;
•
professional education, training, events and services;
•
professional accreditation and assessment; and
•
large, industry-leading annual events.
5
Consistent and sustainable
revenue streams %
189
104
114
2020 2021 2022 2023 2024
2020 2021 2022 2023 2024
138
116
116%
38
38
37
33
2020 2021 2022 2023 2024
36
36%
5.48
6.00
9.29
2020 2021 2022 2023 2024
14.02
19.81
19.81p
+41%
3
Ongoing adjusted basic earnings
per share p
Definition and purpose
This key measure indicates the profit attributable to
individual shareholders. It measures not only trading
performance excluding the impact of changes in the
portfolio from disposals, but also the impact of treasury
management, capital structure and bank and interest
charges, as well as the efficient structuring of the
Group to appropriately manage tax. Our business and
financial strategies are aligned to delivering consistent
growth in ongoing adjusted earnings per share and
our incentive programmes are designed to support this
strategy. Please refer to page 44 for a reconciliation.
Result
Increased by 41% to 19.81p per share (2023: 14.02p)
reflecting the increase in ongoing adjusted profit as
discussed above. The underlying tax rate increased
by 2% to 27%. The number of ordinary shares were
essentially unchanged. Underlying basic EPS defined
as ongoing adjusted basic EPS excluding the impact
of acquisitions increased by 33% to 18.68p per share
(2023: 14.02p).
Result
116% (2023: 138%) owing to strong
conversion of profits into cash through
effective operational efficiency.
Result
Subscription and membership revenue up 16% to 36% (2023:
33%) of organic revenue with the balance a mixture of revenue
from annual events and revenue from customers who have a
history of repeat purchase although not necessarily supported by
formal multi-year contracts. The renewal rate from subscription
and membership revenue was 91% (2023: 92%), reflecting
Wilmington’s robust product development process and high
customer satisfaction.
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Section 172 of the Companies Act 2006
The 2018 UK Corporate Governance Code highlights the importance
of Section 172 of the Companies Act 2006, requiring Directors to act
in a way that promotes the success of the Company for the benefit
of shareholders whilst simultaneously showing regard for the interest
of its other stakeholders.
The Board follows a robust decision-making process, which is designed
to ensure that any decisions made reflect Wilmington’s responsible
business culture. The key reference points for decision making by
the Board are: the impact on the Group’s overall strategic objectives;
consideration of its principal risks and uncertainties; and positive
alignment with the core values underpinning the Group’s sustainability
strategy. At the heart of all of these factors is consideration of the
Group’s stakeholders, because it is these groups who have the
greatest potential to create positive outcomes for the Group as
it strives to create long term value.
Further details on this decision making process can be found
in the Corporate Governance report on pages 67 to 75.
Stakeholder
value creation
Stakeholder engagement and non-financial information statement
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Our people
The delivery of the Group’s strategic objectives is
dependent on our ability to attract, develop and retain
a highly skilled and motivated workforce. We strive
to create an inclusive culture in which diversity of
thought, skills and perspectives helps us thrive.
We are committed to strong recognition and reward
strategies that fairly reflect the contributions our
people make to help us progress.
Engagement
Our employee engagement strategy focusses on
providing our people with platforms to actively
participate in the Group’s decision making processes,
and we are also committed to transparency around
the issues that matter most to them:
•
Employee engagement survey results
directly inform the development of the Group
People strategy.
•
Global and brand level town halls provide a forum
for leaders across the business to engage with
all employees.
•
Our internal intranet acts as a central policy
and guidance portal, and also a communication
platform for our employees to share experiences
and network across the Group.
•
We have developed ‘Wilmington Communities’:
networks of people which stretch across diversity
dimensions that actively inform our work to create
an inclusive workplace.
•
Our performance development review process
encourages honest and open conversations about
personal development.
•
We are an accredited Living Wage employer and
are committed to a fair and transparent reward
and recognition structure.
Several decisions are made every year that affect
our people, read more: pages 27 to 35
Shareholders
Support from our shareholders underpins the success
of our strategy. We aim to provide fair, balanced, and
understandable information to shareholders to clearly
demonstrate strategic progress.
Engagement
We maintain a strong reporting process with
regular digital content updates for shareholders via
our website throughout the year. Our interim and
year end reporting periods conclude with analyst
briefing sessions and investor roadshows, and our
Annual General Meeting.
The Executive Directors maintain close contact with
shareholders and maintain strong relationships to
facilitate one-to-one engagements and conference
calls. One decision in the year which impacted
shareholders is dividends, see page 45.
Read more: page 74
Customers
Our customer-driven product management culture
is key to our success and ensuring that we truly
understand the needs of our customers is critical
to the viability of our future plans.
Engagement
We strive to put our customers at the heart of
our product management process, and this means
working hard to find solutions to meet their needs.
Our key communication channels come in the form
of Customer Advisory Groups (‘CAGs’), feedback
surveys and maintaining strong relationships with key
account contacts. Central to our ambition of delivering
excellent customer experience is the progression of
our accessibility strategy, ensuring anyone who needs
our products and services can access them effectively.
Read more: pages 36 to 37
Suppliers
Strong relationships with our suppliers are crucial
to ensure that the services we receive support the
delivery of our own products effectively. We are also
committed to ensuring mutually high standards of
responsible business from our suppliers.
Engagement
We maintain strong and accessible communication
channels with suppliers, to promote good
relationships and to set clear expectations of the
products and services we require. Our supplier code
of conduct clearly communicates to all our suppliers
the high standards of responsible business practice
we expect from them.
Read more: page 38
Stakeholder engagement and non-financial information statement continued
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The environment and communities
we operate within
We have a responsibility to have a positive impact
on the environment and the communities we operate
within. This responsibility plays an important part
in protecting the wellbeing of our people, and in
contributing to the future health of our planet for
the benefit of all our stakeholders.
Engagement
We are committed to carbon emission reductions,
demonstrated by the reduction in absolute emissions
since our baseline year, and our net-zero targets for
future progress. Our carbon neutral commitment
allows us to contribute further to carbon reduction
initiatives, including a certified biodiversity protection
programme that facilitates long term carbon storage.
Our community and charity policy encourages our
employees to engage positively with the communities
we work within and gives all our people the
opportunity to take paid volunteering leave.
Read more: pages 39 to 42, and 56 to 61
Stakeholder engagement and non-financial information statement continued
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Non-Financial Information and Sustainability Statement
This index constitutes Wilmington’s Non-Financial Information and Sustainability Statement, produced to comply with Sections 414CA and 414CB of the Companies Act 2006.
Reporting requirement
Policies, processes and standards which govern our approach
Page(s)
Environmental matters
Carbon reduction plan, environmental management policy, risk management process and approach to TCFD.
39 to 42, 56 to 61
People
Conduct and compliance policies, diversity and inclusion statement of intent, employee engagement strategy and risk
management process.
27 to 35, 52, 70
Respect for human rights
Modern slavery statement and risk management process.
63, 47 to 55
Social matters
Stakeholder engagement strategy and sustainability strategy.
21 to 24, 68, 25 to 42
Anti-corruption and anti-bribery
ABC policy, risk management process and supplier code of conduct.
38, 47 to 50, 22
Business model
Business model, KPIs and stakeholder engagement strategy.
17 to 24
Risks and uncertainties facing the business
Risk management.
47 to 55
Principal decisions of the Board
The directors’ duties under Section 172 of the Companies Act 2006 are embedded in all the decisions made by the Board, along with other factors, including alignment
with the Board’s strategy and values. A summary is provided below of the principal decisions taken by the Board during the year and how key stakeholders and other
matters were considered by the Board in making those decisions:
Decision
Stakeholder consideration
Change in Board composition
⚪ Long term interests of the Group. ⚪ High standards and reputation. ⚪ Interests of stakeholders.
Approval of the interim and final dividend
⚪ Long term interests of the Group. ⚪ The need to act fairly between members of the Group including shareholders.
Changes to office locations
⚪ Long term interests of the Group. ⚪ The need to act fairly between members of the Group including employees.
Acquisitions and disposals of businesses
⚪ Long term interests of the Group. ⚪ Overall fit with objectives, strategy and performance of the Group. ⚪ Interests of stakeholders including employees.
Change of operating segments
⚪ Long term interests of the Group. ⚪ Interests of stakeholders to understand key information.
In addition to the financial KPIs disclosed on pages 19 to 20, the Group assesses performance using a range of non-financial KPIs relevant to each brand and function.
The Group also uses non-financial KPIs to assess its progress in relation to its sustainability strategy, as outlined on pages 25 to 42.
Stakeholder engagement and non-financial information statement continued
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Wilmington exists to empower its customers to do the right
business in the right way. At the heart of this commitment to
customers is our own ambition to embed a responsible business
culture that informs the way we work. Our sustainability strategy
is underpinned by four strategic pillars that, collectively, reflect
this ambition.
As we successfully drive progress against our broader strategic objectives, we
remain committed to making sustainable business decisions by taking an iterative
approach to materiality. By continuing to listen to our key stakeholders, via the
channels outlined on pages 21 to 24, we continue to refine our sustainability
strategy to ensure that it drives long term value for all of them.
This year we have made significant progress against the targets we previously set
for each strategic pillar of our sustainability strategy. Our iterative approach has led
us to further refining the priority initiatives in each of the four strategic pillars, which
is helping us to make progress and continue to set challenging targets for the future.
Our Global Sustainability Council is chaired by the Chief Executive Officer, with
each strategic pillar being led by an Executive Committee member. This provides
strategic oversight and direction to the delivering of priority initiatives, while
ensuring our sustainability strategy is embedded into everything we do.
Responsible
business culture
Cultural
positivity
Chief People
Officer
Customer
empowerment
Chief Operating
Officer
Proactive
assurance
Chief Operating
Officer
Environmental
responsibility
Chief Financial
Officer
Board oversight
Chair
Global sustainability council
Chief Executive Officer
Sustainability report
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26
Core objective
•
Create an inclusive workplace
that supports, empowers,
develops, and fairly rewards all
our people.
Delivering stakeholder value
•
Fostering a positive culture will
attract and retain the best talent,
accelerating delivery of our
strategy.
•
Investing in our people benefits
the communities we operate
in by delivering exceptional
employee experience.
Meeting our 2024 targets
•
Progress against our Diversity
& Inclusion Strategy.
•
Diversity data collected where
local laws permit.
•
Improved employee engagement
scores against previous years.
•
Maintained the number of Mental
Health First Aiders ('MHFA').
•
Volunteer hours and fundraising
matching increased.
Cultural positivity
Core objective
•
Uphold high standards
related to digital protection,
regulatory requirements, ethics,
and production.
Delivering stakeholder value
•
Responsible digitisation and
ethical conduct echo our core
purpose and underpin our
digital-first approach delivering
the best-in-class digital products.
Meeting our 2024 targets
•
>98% acceptance of cyber
security policy.
•
0 ICO reportable phishing
incidents resulting in the loss
of personal data.
•
100% of products subject to
continuous penetration testing.
1
Proactive assurance
3
Core objective
•
Reduce environmental
impact by minimising carbon
footprint and committing to
responsible procurement.
Delivering stakeholder value
•
Committing to environmental
responsibility protects the future
of our people and demonstrates
to customers that we strive to
deliver products with minimal
environmental impact.
Meeting our 2024 targets
•
Progress against carbon
reduction plan and carbon
reduction initiatives.
•
Provided engagement activities
for our people.
•
ISO 20121 certification for RISE,
FRA, and ARK events.
Core objective
•
Deliver products that are
accessible, high value, up to date
and move with industry trends.
Delivering stakeholder value
•
Empowering our customers
ensures our products are closely
aligned to their needs.
•
Our customer driven approach
to innovation helps us stay agile
in the face of change.
Meeting our 2024 targets
•
WCAG 2.2 compliance
monitoring.
•
Deploying Artificial Intelligence
for increased learner accessibility.
•
Embedded Product Management
Capability Frameworks.
Customer empowerment
2
Environmental responsibility
4
The ongoing work to drive progress against the core objective of each pillar is discussed on pages 27 to 42.
Core value and strategic pillar
Reporting and Communication
Sustainability report continued
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27
Cultural positivity
During the year we continued to make
progress against our People Strategy,
delivering initiatives and making changes
to the way that we work, so that we
continue to create an inclusive workplace
to support, empower, develop and fairly
reward our people. This is reflected
in our progress against implementing
our Diversity and Inclusion strategy
and by our investments in resources
to create a positive environment for all
our people to reach their full potential
at Wilmington.
We embarked on a Wilmington-wide journey to
discover, define, and embed our Wilmington Values –
what makes us, us. We know that defining values and
bringing them to life guides how our people behave,
and how we behave. A values driven culture enhances
the engagement of our people and drives a sustainable
business culture. Through extensive research and
dialogue with our people, we identified the values
that resonate most deeply and that drive our business
strategy; Inclusivity, ambition, integrity and curiosity.
We have integrated our values into our hiring
processes, performance evaluations, and everyday
interactions. By aligning our actions with our values,
we have articulated what makes us, us, but also who
we aspire to be in the future.
Bring your individuality
and always appreciate
and celebrate what
makes us different.
Wilmington Values
Commit to being
the best, achieve
excellence and
together exceed
expectations.
Do the right thing, the
right way, even when
no one is looking.
Be inquisitive to
fuel creativity and
innovation to deliver
the best solution.
“
We have the best people working for Wilmington,
doing their best work with us. We care about them,
include them, and empower them. Our people are
supported, developed, recognised and rewarded fairly. ”
Sustainability report continued
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Cultural positivity continued
As part of our ongoing commitment
to investing in our people, and while
striving to be an even better place
to work, we have been working with
Investors in People to measure our
progress. We have been aligning our
People Strategy to the Investors
in People framework, making
improvements where necessary,
and we have set out our ambition
to achieve our first Investors
in People accreditation and
Investors in Wellbeing
accreditation in the next
financial year.
Our people and customers
supporting local
communities
We provide our people with volunteer
leave to support causes important
to them. At our RISE conferences we
go further and encourage our event
attendees to make a positive impact
on the communities where we host our
events.
Partnering with US Hunger, we hosted
meal-packing events designed to
support local families facing food
insecurity. This is especially relevant
to our people and our attendees as
we present conferences on social
determinants of health, which are
nonmedical factors, such as a person’s
living conditions, education, and
employment, that influence health
outcomes.
This year, our dedicated volunteers
came together to pack an astounding
41,052 meals. These efforts were
distributed to Second Harvest Food
Bank of Greater New Orleans, the
Capital Area Food Bank, and Texas
Food Bank.
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Commitment to...
Inclusivity
Our Diversity and Inclusion Working Group and our Wilmington Communities lead our work to embed a culture of inclusivity at Wilmington, which celebrates
everything that makes our people unique.
This is underpinned by the data we collect about our people, which enables us to understand and measure diversity and inclusion at Wilmington; using data to guide
our strategy and areas of focus. As part of our target for regular data collection and analysis, we continued to collect rich diversity data to help us better understand
the composition of our workforce. By asking our people to disclose this data as part of our annual people engagement survey, we are able to better understand the
diversity characteristics of our people in locations where legislation allows the collection of this information. Our data collection approach was fully compliant with
the relevant regulations in each jurisdiction. By harnessing this data to measure diversity at Wilmington, we are better equipped to build a workforce that reflects the
diversity of the communities we serve and work within. Further details of the gender and ethnicity balance within senior management specifically are disclosed in the
Corporate Governance report on page 70.
“
Our people have rich diversity, experiences, knowledge, and
perspectives which powers our innovation and creativity to help our
customers to do the right business in the right way. ”
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30
What makes our people unique?
Female
Male
Prefer not to say
Non-binary
62%
35%
2%
1%
No
89%
7%
4%
Yes
Prefer not to say
Gender identity
White
Black
Asian
Mixed
Prefer not to say
Other ethnic group
80%
3%
9%
3%
4%
1%
0%
5%
10%
15%
20%
20-24
25-29
30-34
35-39
40-44
45-49
50-54
55-59
60-64
65-69
70+
6%
12%
15%
19%
15%
12%
9%
8%
2%
1%
1%
Ethnicity
Disability or long
term health condition
Age profile
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31
Driving progress
We continue to make significant progress in delivering the impactful initiatives
we set out to in our Diversity & Inclusion strategy, across the whole of Wilmington.
These initiatives are focused on changing the way we work, creating lasting
impact, and weaving diversity and inclusion into everything we do. This year,
we have made the following progress:
•
Every brand and function has a dedicated Diversity & Inclusion champion,
and they are delivering against their diversity & inclusion plans.
•
Focused on launching and developing more Wilmington Communities.
These employee resource groups now represent Age, Carers, Disability,
Family & Parents, Gender, LGBTQIA+, Menopause, Neurodiversity,
Race & Ethnicity, and Religion & Belief.
•
Extended our hiring manager training to ensure our hiring managers are fully
equipped to reduce bias in the hiring process and to hire the best people
to join us.
•
Enhanced our People Leader Programme, featuring Inclusive Leadership, which
has been rolled out to more of our leaders, and forms part of our leadership
and management development suite.
•
Through our very active Wilmington Communities, our #WeAreWilmingtonPlc
campaign continues to share what is important to our people and celebrating
the diversity of our people.
•
Ran our Early Careers Programme, attracting and recruiting a diverse range
of talent not limited by university education.
•
Achieved the next level of Disability Confident accreditation. We are now
an accredited Disability Confident Employer.
•
Developed and ran a neurodiversity awareness and education series.
This celebrated neurodiversity while providing an opportunity for our people
to find out more about neurodivergent conditions.
We recognise the power of collaboration and shared expertise. Therefore, we work
with external networks, community and advocacy groups, and charities, to ensure
that our work incorporates emerging thinking and best practice, responds to what
is important to our people, and fosters accountability. We are:
•
A Committed Member of Inclusive Employers, collaborating with other
employers to share best practice.
•
Signatories of the Business In the Community ('BITC') Race at Work Charter
and continue to follow our roadmap to meet the commitments we made.
•
A member of the Employers Initiative on Domestic Abuse ('EIDA'), taking action
on domestic abuse.
•
An accredited Living Wage Employer, because we believe our people deserve
a wage which meets their everyday needs.
•
Signatories of the Menopause Workplace Pledge, committed to taking positive
action to make sure everyone going through the menopause is supported.
•
Participants in the 10,000 Black Interns programme, offering more paid
internships for Black students and graduates.
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Commitment to...
Talent development
We are dedicated to fostering a culture of continuous learning and development throughout Wilmington. Our Talent Development strategy is designed to provide our
people with the tools, resources, and opportunities they need to grow both personally and professionally, supported by our annual performance evaluations. This year,
we have made the following progress:
•
Embedded our leadership and management development suite of learning to provide for aspiring managers, through to our most experienced leaders.
•
Expanded our mentoring scheme to provide personalised guidance and support, tailored to the career paths of our people.
•
Introduced targeted coaching interventions which are carefully structured to cater to the unique needs and aspirations of our people.
•
Extended our suite of capability standards, providing visibility of what excellence looks like at every level, and which now includes Marketing,
Client Support and Success, Technical Training, Leadership and Management, Product Management, and Sales.
•
Rolled out, embedded, and refined a new digitised performance management process, increasing efficiency, enhancing transparency,
and facilitating continuous growth.
•
Reviewed how we communicate with our people, and trialled fresh approaches to make interactions more impactful and meaningful.
•
Launched a new careers website, shining a light on life at Wilmington, to attract talent.
•
Working with Investors in People, developed a roadmap to achieving “We invest in people” accreditation.
“
Our people are empowered to learn and develop themselves and have
opportunities to do so, whatever their eventual aim. We provide the right environment and
support so that our people can perform at their best, at every stage of their career. ”
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Commitment to...
Wellbeing
“
We create the right environment and offer the right support so that our
people can live balanced and fulfilled work and home lives. They feel a sense
of belonging and are inspired and motivated to do their best work. ”
We take a holistic approach to the wellbeing of our people, recognising that their personal fulfilment directly contributes to our collective success. Our commitment
extends beyond professional growth to nurturing environments where our people thrive both at work, and in their personal lives This year, we have made the following
progress:
•
Maintained a dedicated focus to wellbeing led by our Engagement & Wellbeing Officer.
•
Launched and implemented a new hybrid working policy, with specific guidance for managers, enhancing flexibility and support for our people and promoting
a balanced and productive work environment.
•
Brought together our Wellbeing Champions to launch a refreshed Wellbeing Champions Charter, providing them with additional training, and raising the profile
of their work and the support provided by Mental Health First Aiders.
•
Delivered “Leading for Wellbeing and High Performance” to our senior leaders, a training programme which focusses on leading in a way that that prioritises
the health, resilience, and sustainable performance of our people.
•
Offered extensive wellbeing-orientated benefits including our global employee assistance programme, digital GP and healthcare support.
•
Working with Investors in People, developed a roadmap to achieving “We invest in wellbeing” accreditation.
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Commitment to...
Recognition and reward
“
Our people understand how reward works and are paid fairly against
market. Their individual and team performance is recognised so that we drive
high performance and attract and motivate talented people. Our people feel
valued and appreciated for their contribution. ”
Our fair compensation and robust recognition practices foster a culture where our people are motivated to excel. Our commitment to reward and recognition ensures that
we not only attract top talent but also retain and inspire our teams to achieve their best. This year, we have made the following progress:
•
Focused on developing people leaders, equipping them with the tools they need to lead effective reward and recognition processes.
•
Maintained our Accredited Living Wage Employer status in the UK, upholding our commitment to fair wages.
•
Completed in-depth global gender pay gap reporting as part of our strategy for closing the gap.
•
Following a comprehensive review of employee benefits, we delivered several campaigns to build awareness and engagement in our benefits offerings.
•
Maintained a popular Save As You Earn ('SAYE') scheme, meaning our eligible UK people both share in our success and benefit from tax-efficient savings.
•
Launched Reward Hub, bringing together and centralising resources to educate and inform our people about reward and recognition, and the benefits available
to them.
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Monitoring progress
We continue to grow and evolve Cultural Positivity throughout Wilmington, and
our approach highly values engagement and involvement from our people to help
us to shape and enhanced their experience at work. This year, 88% of our people
globally participated in our annual employee engagement survey, sharing valuable
insights into the issues that matter most to them. This feedback is one of the tools
we use to monitor our performance in respect of strong employee experience, and
influences our People Strategy.
Additionally, data collected around diversity demographics as disclosed on
page 30 allows us to monitor the diversity of our people. We use this data to view
the insights provided in the employee engagement survey through a diversity lens,
to measure inclusion.
We are pleased to have met our target to maintain or improve our engagement
scores against key areas of focus since the FY20 baseline year, having delivered
the best scores to date.
We are committed to continuous improvement and have local level engagement
plans in place for this. We have conducted in-depth reviews into our scores,
and have shared our findings with our people along with our 'commitments’
for further improvements.
Further details of our approach to employee engagement can be found in the
Section 172 statement on page 22.
Driver
Outcome
FY20
score
FY21
score
FY22
score
FY23
score
FY24
score
Diversity and
Inclusion
At Wilmington, people
of all backgrounds are
accepted for who they are
8.1
8.4
8.3
8.4
8.8
Training and
Development
My manager or mentor
encourages and supports
my development
7.4
7.7
7.8
7.9
8.2
Health and
Wellbeing
Employee health and
wellbeing is a priority
at Wilmington
6.3
7.8
7.4
7.4
7.9
Our work in this area contributes to: SDG 3 Good health and wellbeing, SDG 5
Gender equality and SDG 8 Decent work and economic growth, with a focus on
the below sub-indicators:
3.4 By 2030, reduce by one-third premature mortality from non-communicable
diseases through prevention and treatment and promote mental health
and wellbeing.
5.5 Ensure women’s full and effective participation and equal opportunities for
leadership at all levels of decision making in political, economic and public life.
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Customer
empowerment
We have further strengthened our customer
empowerment culture by investing in accessibility,
innovation and agility, and strong customer
engagement. We place customer centricity at the
heart of product development, ensuring that product
development is customer led, and their needs are
reflected from development to delivery.
How we are driving progress
Principles
Outcomes
Investing in...
Accessibility
Our products are
accessible to all.
•
Deployed advanced accessibility tools which allow us to automate auditing to
the latest WCAG 2.2 standards, complemented by manual testing to ensure
comprehensive accessibility.
•
Introduced Natural Language Processing (a subset of Artificial Intelligence) to simplify
complex training materials and make interactions more accessible for learners.
Innovation
and agility
An embedded
dynamic product
management
approach that can
respond rapidly
to change whilst
maintaining high
quality outputs.
•
Expanded the adoption of a single technology platform, embedding a shared infrastructure
and developing common best practice.
•
Embedded Product Management Capability Frameworks, articulating the expectations
of customer centricity in product development and providing clear career paths for
Product Development professionals.
•
Adapted our approach to iterative product launches, delivering timely and regular updates,
while being responsive to stay responsive to evolving needs and changes.
Strong
customer
engagement
Customers directly
inform new product
development, and
we facilitate strong
communication
channels for
customer feedback.
•
Expanded our technological monitoring capabilities, utilising more telemetry than ever
before. This allows us to provide even deeper, real-time insights into our customers' needs
and behaviours, ensuring we remain at the forefront of data-driven decision-making.
•
Adhered to customer focus standards to maintain ISO 9001 accreditations, systematically
gathering and utilising customer feedback to drive improvements that enhance their
experience and align with industry expectations.
Our ambition to create an inclusive culture at Wilmington extends beyond our own people, to the clients and
customers we serve, ensuring accessibility across our product range. We have been leveraging advanced
technology, including artificial intelligence, to enhance engagement and accessibility across our products,
reflecting our ongoing efforts to make our products more inclusive and user-friendly for all. Our accessibility
agenda extends far beyond our digital assets and is an integral part of our wider Diversity and Inclusion
strategy as discussed on pages 29 to 31.
“
We are committed to embedding a customer-led approach to product development
and delivery. Our customers directly inform our agenda, and by creating accessible, high value
and up to date products we empower them to realise maximum value from our offering. ”
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Progress on Digital Accessibility
Ensuring digital accessibility across our platforms and products remains a top
priority, driven by our commitment to regulatory compliance and enhancing user
experience. We use advanced accessibility tools which allow us to automate
auditing to the latest WCAG 2.2 standards, complemented by manual testing
to ensure comprehensive accessibility.
We have focused on role-specific accessibility training, for example training
for our marketing and content professionals on creating accessible digital
experiences. This training ensures that our content is clear, understandable,
and inclusive, meeting the diverse needs of all users.
We maintain detailed progress monitoring to track accessibility improvements.
This enables us to measure the impact of fixes and enhancements, ensuring
continuous improvement.
Our work in this area contributes to the UN goal SDG 10 Reduced
inequalities, with focus on sub-indicator 10.2: By 2030, empower
and promote the social, economic and political inclusion of all,
irrespective of age, sex, disability, race, ethnicity, origin, religion
or economic or other status.
ISO 9001: Customer Empowerment in ICA
Our commitment to Customer Empowerment is highlighted by the International
Compliance Association (ICA) maintaining ISO 9001 certification - the globally
recognised standard for quality management systems. The certification provides
our customers with the confidence that ICA's offerings are developed, managed,
and refined according to best practices. It ensures that feedback from customers
is systematically gathered and used to drive improvements. Responding to
customer needs not only enhances their experience but also ensures that
the solutions we provide are directly aligned with their expectations and
industry demands.
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Proactive
assurance
Ethical compliance
Responsible business practice is at the
heart of our strategy, and therefore we
aim to instil a culture of strong ethical
compliance across the portfolio. Our
ethics policies are designed to provide
clear and consistent guidance to our
people to ensure they contribute to these
high standards of ethical conduct, and
are outlined for all employees in our
internal policies.
One of the key elements of our core value of Cultural
Positivity is that Wilmington reflects a safe and
inclusive working environment that encourages
strong employee engagement and participation by all.
Management encourages this by advocating universal
openness and transparency in respect of reporting
non-compliance of any form, with clear guidelines
provided in the Group’s ABC and whistleblowing
policies. As we advocate high standards of integrity
internally, we echo this sentiment in respect of our
external stakeholders by taking a zero-tolerance
approach to any forms of unethical behaviour within
our wider operations and supply chains.
During the year we have:
•
Reviewed and maintained the mandatory policy
acceptance process;
•
Achieved >98% target for policy acceptance rate;
•
Expanded the scope of mandatory training by
creating role-specific mandatory training;
•
Maintained the requirement to demonstrate a
commitment to responsible behaviour into our
supplier onboarding process through our supplier
code of conduct; and
•
Launched the Compliance Hub, bringing together
and centralising our compliance expertise.
Responsible digitisation
Our customers rely on us to help them do the right
business in the right way, and expect that we take a
proactive approach to upholding the highest standards
of data privacy and cyber security.
Our digital assurance process is governed by skilled
individuals who maintain high levels of control and
compliance and implement best practice in this area.
We are also dedicated to helping our technology
experts continue to stay ahead of the ever-evolving risk
of cyber security, with continuous update training and
dedicated resources to enhance awareness.
We have particularly focused on developing and
deploying a robust and measurable quality procedure
for all customer-facing code. This ensures reliability,
security, and performance in our digital products,
ultimately enhancing the user experience.
We remain committed to the highest standards of
compliance in this area and in the year we achieved our
goals to deliver:
•
>98% acceptance of cyber security, acceptable
use and data protection policies;
•
0 ICO reportable phishing incidents resulting
in the loss of data; and
•
100% of internal products undergo continuous
penetration testing.
Our work in this area contributes
to the UN goal SDG 16 Peace,
justice and strong institutions,
with focus on sub-indicator 16.6:
Develop effective, accountable and
transparent institutions at all levels.
Compliance Hub
We recognise the critical importance of navigating the complex landscape of compliance with clarity
and confidence in our own business. Therefore, our newly launched Compliance Hub brings together
our compliance expertise to serve as a comprehensive resource which streamlines access to essential
compliance information and support services, centralising the latest policies, guidelines, and expert advice.
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Environmental
responsibility
Our commitment to environmentally responsible
operations is an essential part of our contribution to
creating a healthy planet for our people, our partners
and our local communities to prosper. Our biggest
direct impacts on the planet come from resource use
and emissions from our offices, and we continue to
focus on transitioning to sustainable materials and
methodologies to reduce this impact.
ISO 20121: Our focus on event sustainability
RISE, FRA, and ARK achieved ISO 20121 certification,
marking a significant milestone in our sustainability journey.
ISO 20121 outlines principles and practices to help organisations
plan, execute, and assess the environmental, social, and economic
impacts at their events. It assesses the way sustainability is
integrated into key decisions at every step of event planning and
staging. The certification emphasises reducing negative impacts,
enhancing positive ones, and promoting sustainability throughout the
event lifecycle.
This certification reflects our commitment to integrating sustainable
practices across our operations, and in particular ISO 20121 aligns
to each of the four pillars of our sustainability strategy.
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Environmental responsibility continued
This year, we have made the following progress
to reduce our environmental impact:
•
Performed a comprehensive review of office
premises to consolidate our operations and
improve efficiency, which we will continue to
review regularly;
•
Maintained renewable tariffs for energy use at all
of our occupied UK sites;
•
Continued to engage and collaborate with
landlords and fellow tenants to consider solutions
to further reduce environmental impact. For
example, solar panels have previously been
installed at one of our UK occupied sites;
•
Made improvements to the quality of supply chain
carbon emission data;
•
Maintained a focus on reducing single use plastic
increasing more effective waste management;
•
Sustained the digitisation of products to reduce
the need for travel and improve efficiency
of delivery;
•
Increased communications to our people, raising
awareness of sustainability topics;
•
Provided engagement activities for our people
to encourage participation and positive
collective action;
•
Kept our business travel policy under regular
review, while encouraging the use of low carbon
modes of transport;
•
Removed the use of company cars while offering
an electric and hybrid salary sacrifice car scheme
as an employee benefit;
•
Launched and implemented a new hybrid working
policy, promoting a flexible working environment
that provides for more efficient office and
resources use; and
•
Achieved ISO 20121 certification for RISE, FRA,
and ARK events, demonstrating our commitment
to integrating sustainability into our work,
and specifically into the lifecycle of our events.
Climate change, energy and
carbon reporting
In response to the climate crisis, we also recognise the
need to accelerate action to ensure that our business
plays an active role in the global effort to address the
impacts of climate change and the transition to a low
carbon economy.
We maintain our commitment to carbon neutrality
by offsetting our Scope 1, 2 and controllable Scope
3 emissions, through high quality accredited carbon
offset schemes focused on biodiversity protection and
innovation in renewable energy technologies.
We have set net-zero carbon targets with a 2019
baseline year, aligned to a 1.5°C trajectory, and have
published our carbon reduction plan to progress
against these goals. We have set ambitious reduction
targets in respect of Scope 1 and 2 emissions well
in advance of 2050 and have worked hard to set
challenging targets in respect of Scope 3 emissions
despite the challenge of managing emissions from
sources we do not directly control.
Our targets
Scope 1 and 2 emissions:
•
Absolute1 zero by 2028
Scope 3 emissions:
•
Near term: reduce by 52% from baseline by 2030
•
Long term: Net zero by 2045
Our reporting on energy use and GHG emissions
is in line with the Streamlined Energy and
Carbon Reporting (‘SECR’) legislation. To reflect
our commitment to monitor, report and reduce our
environmental impact, we have also increased the
scope of our GHG reporting to include Scope 1, 2
and 3 emissions in line with Science Based Targets
initiative recommendations.
Energy use and GHG emissions have been
assessed following the Greenhouse Gas Protocol
Corporate Standard and using the 2023 emission
conversion factors published by the Department
for Environment, Food and Rural Affairs (‘Defra’)
and the Department for Business, Energy, and
Industrial Strategy (‘BEIS’). The assessment follows
the market-based approach for assessing Scope 2
emissions from electricity usage. The operational
control approach has been used. All Group entities
have been included in the assessment. Assurance
over the data used to calculate emissions has
been obtained from a reputable third-party carbon
assessment
analyst. The use
of employee and
turnover ratios is
important to reflect
Wilmington’s
relative
performance in
relation to two
of the measures
that fluctuate in
line with strategic
business change.
1. Nil carbon emissions achieved without associated carbon offset
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Global carbon footprint assessment
30 June 2019
Baseline Tonnes
of CO2e
30 June 2023
Tonnes of CO2e
30 June 2024
Tonnes of CO2e
Change since
baseline %
Change in
the year %
Emissions from:
Scope 1 – direct emissions
84.91
13.01
6.96
(91.8)
(46.5)
Scope 2 – indirect emissions
388.15
35.28
42.81
(89.0)
21.3
Total Scope 1 and 2 emissions
473.06
48.29
49.78
(89.5)
3.1
CO2 employee ratio Scope 1 and 2 (tonnes of CO2 per employee)
0.61
0.06
0.06
(89.8)
0.0
CO2 turnover ratio Scope 1 and 2 (tonnes of CO2 per £m revenue)
4.27
0.41
0.41
(90.3)
0.0
Scope 3 – other indirect emissions
3,837.64
1,599.08
1,384.20
(63.9)
(13.4)
Total (all Scope 1, 2 and 3)
4,310.70
1,647.37
1,433.98
(66.7)
(13.0)
Total UK energy consumption (kWh)
1,206,678
660,454
637,342
(47.2)
(3.5)
Total global energy consumption (kWh)
1,442,921
757,135
754,134
(47.7)
(0.4)
The base year and previous year have been re-stated to account for divestments and acquisitions.
UK energy consumption accounts for 85% of total energy consumption.
The CO2 emission have not been split out between UK and offshore, as it is impractical to do so.
The scope 2 increase is due to office usage and is expected to down next year as office space is being reduced or closed.
Our carbon footprint remained constant from the previous year, which continues to be significantly reduced from the baseline year. We remain focused on further reductions,
in line with our carbon reduction plan and our net-zero carbon targets.
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Waste reduction
We are also committed to reducing
waste, and to minimising the carbon
footprint associated with the disposal
of waste we do produce. Along with
the measures set out in our waste
management policy on the Wilmington
plc website, we are also continually
reviewing waste management with
our landlords to reduce the amount
of our office waste going to landfill to
0%. Since 2021 we have reduced the
proportion of our waste that goes to
landfill from 10% to 8% of our total.
Further details of our response
to climate change are outlined
in our TCFD reporting index on
pages 57 to 58.
Recycling
Incineration with energy recovery
Landfill
60%
30%
10%
Recycling
Incineration with energy recovery
Landfill
65%
29%
6%
2021 waste disposal routes
2022 waste disposal routes
Our work in this area contributes to SDG 12 Responsible consumption and production, and SDG 13 Climate action, specifically 12.2: By 2030,
achieve the sustainable management and efficient use of natural resources and 12.5: By 2030, substantially reduce waste generation through
prevention, reduction, recycling and reuse.
Recycling
Incineration with energy recovery
Landfill
63%
31%
6%
2023 waste disposal routes
2024 waste disposal routes
Recycling
Incineration with energy recovery
Landfill
57%
35%
8%
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Financial review
Overview
The Group performance
was again strong during the
year, driving organic growth
in revenue and profit and
improving the balance sheet,
reflected by the increased
closing net cash position and
the reduced lease liabilities.
We also sold our Healthcare
and MiExact businesses and
acquired Astutis, all of which
have a significant effect on our
balance sheet and trading.
Adjusting items, measures and adjusted results
In this financial review reference is made to adjusted results as well as
the equivalent statutory measures. The Directors make use of adjusted
results, which are not considered to be a substitute for or superior to IFRS
measures, to provide stakeholders with additional relevant information
and enable an alternative comparison of performance over time. Adjusted
results exclude amortisation of intangible assets (excluding computer
software), impairments, other income (when material or of a significant
nature) and other adjusting items.
Variances described as ‘organic’ are calculated by adjusting the revenue
change achieved year-on-year to exclude the impact of changes in foreign
currency exchange rates and also to exclude the impact of changes in the
portfolio from acquisitions and disposals.
2024
£’m
2023
£’m
Absolute variance
£’m
%
Statutory continuing revenue
98.3
93.1
5.2
6%
Continuing adjusted profit before tax
23.7
19.5
4.2
21%
Continuing adjusted profit margin %
24%
20%
Revenue
Group revenue increased 6% on a statutory continuing basis and 9% on
an organic basis, the statutory continuing increase reflecting £0.9m of
foreign currency downside and the impact of disposals carried out part
way through the year. Full details can be found in the Review of operations
on pages 17 to 18.
Operating expenses before
amortisation of intangible
assets (excluding computer
software), impairment
and adjusting items
Operating expenses before amortisation of
intangible assets (excluding computer software)
and impairments increased to £76.6m (2023:
£73.8m).
Within operating expenses, staff costs were
£43.6m (2023: £44.4m). This net decrease
reflects the reduced salary cost as a result
of the decrease in headcount post disposals
which was partly offset by inflationary pay
rises. Share based payment costs increased
£0.4m due to a full year of charge relating to
the 2023 SAYE scheme and the introduction
of the 2024 SAYE scheme, which commenced
in the year.
Non-staff costs increased by £3.6m to £33.0m
(2023: £29.4m), reflecting the current year
costs of Astutis from November and general
inflationary increases.
Unallocated central overheads
Unallocated central overheads, representing
Board costs and head office salaries, as well
as other centrally incurred costs were £4.2m
(2023: £3.7m).
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44
Financial review continued
Adjusted profit before tax
(‘adjusted PBT’)
As a result of increased revenue and a continued
focus on operational efficiency, adjusted profit before
tax, which eliminates the impact of amortisation
of intangible assets (excluding computer software),
impairments, other income and other adjusting
items, was up 21% to £23.7m (2023: £19.5m).
Adjusted profit margin (adjusted PBT expressed
as a percentage of revenue) also increased
to 24% (2023: 20%).
Total Group adjusted profit before tax was up 13%
to £27.6m (2023: £24.3m) and on a total basis the
adjusted profit margin increased to 22% (2023: 20%).
Amortisation excluding computer
software, impairment, adjusting
charge and other income
Amortisation of intangible assets (excluding computer
software) was £2.1m (2023: £1.1m) representing
amortisation from acquired intangibles. The increase
year on year largely reflects the acquisition of Astutis
made during the year.
The non-cash impairment of £4.4m (2023: £nil)
represents the impairment of goodwill in Compliance
Week. See note 12 for further details. The adjusting
charge of £0.6m (2023: £0.1m) represents strategic
costs for acquisitions.
Gain on disposals represents a total net gain of
£26.8m consisting of £5.5m included within other
income largely relating to MiExact, and £21.3m
gain disposal of European Healthcare included
within profit from discontinued operations, see note
11 for further details. Other income also includes
£2.2m representing a gain on the sale of a building
and the early exit of the head office lease leading to
a lease modification, see note 4a for further details.
Operating profit
Operating profit was £22.2m (2023: £20.3m), driven
largely by the £5.5m gain on disposal of subsidiaries
(2023: £2.2m), the gain on disposal of property, plant
and equipment and lease modification of £2.2m,
partially offset by £4.4m of goodwill impairment.
Net finance costs
Net finance income up £1.8m to £2.0m (2023: £0.2m),
primarily related to the interest received on the
significant cash balance the Group maintained
during the year
Profit before taxation
Profit before taxation was £24.2m (2023: £20.5m);
a reconciliation of profit before tax to adjusted profit
before tax can be found in note 2.
Taxation
The tax charge for the year was £7.0m (2023: £3.3m)
reflecting an effective tax rate of 29.4% (2023: 16.2%).
The increase in the tax rate year-on-year reflects an
increase in the full year of UK corporation tax at 25%,
offset by the nature of other operating income with
business disposals qualifying for the SSE.
The underlying tax rate which ignores the tax
effects of adjusting items increased to 27.2%
(2023: 25.2%). The increase reflects the full year
of the UK corporation tax increase from 19% to
25%, with only one quarter being applied to FY23.
Earnings per share
Adjusted basic earnings per share increased by
17% to 19.38p (2023: 16.57p) see note 9, due to
the increase in adjusted profit before tax, offset by
an increase in the corporation tax rate causing an
increase in the underlying tax rate. The number of
issued ordinary shares was essentially unchanged.
Total basic earnings per share was 46.32p
(2023: 22.94p) reflecting the increase in profit
after tax, see note 9.
Ongoing adjusted basic earnings per share,
excluding the results of sold and closed businesses,
increased by 41% to 19.81p (2023: 14.02p),
see reconciliation below.
2024
£’m
2023
£’m
Adjusted earnings
(note 9)
20.4
18.9
Remove profit after
tax of sold and closed
businesses
(2.8)
(6.6)
Ongoing adjusted
earnings
17.6
12.3
2024
Number
2023
Number
Variance
Weighted average
number of ordinary
shares (note 9)
88,964,817
88,027,119
Ongoing adjusted basic
earnings per share
19.81p
14.02p
41%
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Wilmington plc Annual Report and Financial Statements 2024
45
of £0.1m and £0.4m recognised from the acquisition
of Astutis. The remaining £0.1m reflects exchange
translation differences.
Deferred consideration receivable
The deferred consideration receivable balance of
£16.5m (2023: £1.9m) relates to the disposal of ICP
in July 2018, the disposal of MiExact in January 2024
(see note 11), and the disposal of UK Healthcare in
June 2024 (see note 11), with £14.8m recognised
within non-current assets and the remaining £1.7m
recognised within current assets.
Trade and other receivables
Trade and other receivables reduced to £20.3m (2023:
£27.4m) largely due to the disposals of Healthcare
and MiExact.
Current tax liability
At 30 June 2024 the Group recognised a liability
relating to current tax of £1.1m (2023: £0.1m).
Deferred tax
The deferred tax liability of £1.4m (2023: asset
£0.3m) comprises the deferred tax liability for
acquired intangibles on acquisition of Astutis,
partly offset by a deferred tax credit for the change
in corporation tax rate and movement in capital
allowances. The deferred tax expense in the
P&L of £0.1m (2023: £1.1m credit) comprises the
change in corporation tax rate and movements
in capital allowances.
Trade and other payables
Trade and other payables decreased by £5.5m
to £50.5m (2023: £56.0m). Within this, contract
Dividend
A final dividend of 8.3p per share (2023: 7.3p) will
be proposed at the AGM. This will give a full year
dividend up 13% to 11.3p (2023: 10.0p) and dividend
cover of 2.0 times (2023: 2.1 times).
If approved it will be paid on 4 December 2024
to shareholders on the register as at 1 November
2024 with an associated ex-dividend date of
31 October 2024.
Balance sheet
Non-current assets
Goodwill at 30 June 2024 was £52.8m
(2023: £60.6m). The decrease is due to disposals
of £14.3m and impairment in the Compliance Week
CGU of £4.4m, following the decision to sell it
with the remaining goodwill in Compliance Week
of £0.4m transferred to held for sale, partly offset
by the goodwill arisen from the acquisition
of Astutis of £11.2m.
Intangible assets increased by £4.5m to £10.2m
(2023: £5.7m) due to the acquisition of Astutis
of £9.9m and additions of £0.2m within computer
software; partly offset by amortisation of £3.7m,
and £1.8m of disposals largely relating to the
disposal of subsidiaries. The remaining £0.1m
variance reflects exchange translation differences.
Property, plant and equipment decreased by £3.9m
to £3.1m (2023: £7.0m). This is attributable to the
£1.5m decrease from disposals largely relating to
the disposal of subsidiaries, £0.8m decrease due
to the lease modification, depreciation of £1.8m
and an impairment of the assets associated with
the head office of £0.4m. Partly offset by additions
liabilities decreased by £5.8m to £27.9m
(2023: £33.7m) largely due to the disposals
of Healthcare and MiExact.
Provisions
Provisions were £0.2m (2023: £1.2m) in respect
of anticipated future costs in relation to the closed
proportion of the head office until the end of the
contractual lease term. During the year, the lease term
on the head office building was renegotiated and we
will exit the building in December 2024, the provision
was unwound by £0.8m, utilised by £0.3m, and the
liability reflects the term until December 2024.
Share capital
In October 2023 Wilmington issued 823,568 ordinary
voting shares of £0.05 to satisfy the Company’s
obligations under its Performance Share Plan. In
December 2023 Wilmington issued 582,637 ordinary
voting shares of £0.05 to satisfy the Company’s
obligations under its SAYE Plan.
During the year 53,519 shares held by the Employee
Share Ownership Trust (‘ESOT’) were used to satisfy
the Company’s obligations under the SAYE Plan
and 54,610 shares held by the ESOT to satisfy the
Company’s obligations under its Performance Share
Plan. At 30 June 2024, the ESOT held 244,522 shares
(2023: 352,651) in the Company, which represents
0.3% (2023: 0.4%) of the called up share capital.
During the year 391 shares held in treasury were
used to satisfy the Company’s obligations under the
SAYE Plan. At 30 June 2024, 4,817 shares (2023:
5,208) were held in treasury, which represents 0.1%
(2023: 0.1%) of the share capital of the Company.
Financial review continued
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Net cash, lease liabilities and
cash flow
Net cash, which includes cash and cash equivalents,
cash classified as held for sale and lease liabilities,
was £65.0m (2023: £35.0m). This significant net cash
position is driven by a strong trading performance
delivering improved profits and effective cash
management as well as a cash inflow associated with
the disposal of businesses offset by the purchase of
Astutis. Please refer to note 28 for further information.
Lease liabilities decreased to £2.8m (2023: £7.2m).
£0.9m (2023: £2.1m) cash payments in relation to
contractual lease obligations were made reducing
the balance, the lease modification reduced the
balance by £2.7m, coupled with disposals of £1.3m.
The reduction is offset by £0.2m (2023: £0.2m) of
notional interest on lease liabilities reported within
finance costs and additions of £0.3m upon the
acquisition of Astutis.
Cash conversion remained strong at 116%
(2023: 138%). See note 27 for further details.
Portfolio update
Acquisition of Astutis
In November 2023, we completed the acquisition
of Astutis, a training business offering a range of
globally recognised and regulated health, safety
and environmental qualifications, based in Cardiff,
for an initial consideration of £16.8m, with contingent
consideration of up to £4.7m based on Astutis'
performance in each of the two years ending 30 June
2025 and 30 June 2026. The business has achieved
strong growth in recent years in the growing HSE
market and is highly complementary to our existing
portfolio. The acquisition of Astutis, which is earnings
enhancing, is consistent with our strategy in the
GRC market to broaden and strengthen our training
and education capabilities. Astutis embodies all of our
six key business characterises in that it operates in
growing GRC focused regulated markets, has a strong
and experienced management team, a comprehensive
products suite, growing revenues and profits, and
excellent digital capabilities. The fair value of the
net assets acquired in the business at acquisition
date was £9.0m, resulting in goodwill on acquisition
of £11.2m. See note 10 for further details.
Disposals
We continue to review all parts of the Group
assessing businesses against six key characteristics:
organic growth opportunities; attractive markets;
digital and data capabilities; strong leadership;
strategic fit to the GRC marketplaces; and attractive
product, revenue, and profitability characteristics.
As part of this ongoing review we determined that
our Healthcare, Compliance Week and MiExact
businesses no longer met our criteria. MiExact
and Healthcare were sold during the year,
Compliance Week is in a sale process. We
also took the decision to close our business
in Singapore and Malaysia due to
continuing declining revenues, ongoing
losses and little prospect of recovery
given the local market conditions.
We will continue to serve the
Singapore and Malaysia markets
from the UK.
MiExact, a UK mortality data business, was sold
in January 2024 for £9.6m recognising a gain of
£5.9m included within other income. The European
Healthcare business was sold in two parts. The first
was the disposal of APM, a French healthcare
business, for €26.0m in cash in April 2024
recognising a gain on disposal of €23.3m (£19.9m)
included within discontinued operations. The second
was the sale of the UK healthcare business for a
consideration of up to £26.3m recognising a gain
on disposal of £1.5m included within discontinued
operations. See note 11 for further details.
Guy Millward
Chief Financial Officer
08 October 2024
Financial review continued
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47
Responsibility for the Group’s system of risk management and internal controls
ultimately lies with the Board. Risk identification, assessment and management
are central to the Group’s internal control environment, and risk management
is recognised as an integral element of the Group’s operating activities.
The Board is also responsible for determining the Group’s appetite for risk, and
the acceptable level of risk that can be taken on by the Group and its individual
operating entities when assessing its strategic objectives (‘Wilmington risk
appetite’). The Board sets and clearly communicates its local risk appetite to the
business leaders responsible for executing their activities in various locations
across the global portfolio. The guidelines set in response to the Group’s
risk appetite are complemented by the Group’s comprehensive portfolio
of policies governing conduct, including its Anti-Bribery and Corruption
(‘ABC’) and Modern Slavery guidelines, and in accordance with delegated
authority limits. The Group’s risk assessment covers a three -year period,
as is consistent with the period of assessment used in its strategic
planning process and viability review.
The Wilmington Executive Committee coordinates and facilitates
the risk assessment process on behalf of the Board. The Executive
Committee reports directly to the Board using a combination
of structured formal interviews, monthly operational updates,
site visits, ‘bottom up’ reporting and registers (together,
the ‘risk assessment’). The risk assessment covers both
external and internal factors and the potential impact
and likelihood of those risks occurring. Twice per annum
the Audit Committee discusses the report received
from the external auditor regarding their review and
audit procedures, which include, comments on their
findings on internal control and risks.
Identifying and
managing our risks
Once identified, risks are reviewed and then incorporated into formal risk registers
held at both a Group and entity level, which evolve to reflect any changes to
identified risks and the emergence of any new risks. Where it is considered that
a risk can be actively mitigated to the benefit of the business, responsibilities are
assigned, and action plans are agreed.
As well as assessing ongoing risks the Executive Committee considers how the
business could be affected by any emerging risks over the long term. Emerging
risks are those which may develop but have a greater uncertainty attached to
them. Twice per annum Managing Directors (‘MDs’), and Heads of Group Functions
are asked to highlight any new or emerging new risks; these are then reported
to the Board and monitored on an ongoing basis.
Our risk assessment process provides a clear framework for identifying and
managing risk, both at an operational and strategic level, and has been designed
to be appropriate to the ever-changing environments in which we operate.
Risks and uncertainties facing the business
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Board
Ultimate responsibility for
risk management
Responsibilities
• Approve the Group’s strategy and objectives
• Determine Group appetite for risk in achieving its
• strategic objectives
• Establish the Group’s systems of risk management and
internal control
Actions
• Assess managements strategic decisions in the context of the Group’s risk appetite
• Receive regular risk updates from the businesses
Audit Committee
Supporting the Board
Responsibilities
• Supports the Board by monitoring risk and reviewing the
effectiveness of Group internal controls, including systems
to identify, assess, manage and monitor risks
Actions
• Receive regular reports on the internal and external audit and other assurance activities
• Determine the nature and extent of the principal Group risks and assess the effectiveness
of mitigations
• At least annually review the effectiveness of risk management and internal control systems
• Review the adequacy of the Group’s key conduct policies
Executive Committee
Ongoing review and
control
Responsibilities
• Strategic leadership of the Group’s operations
• Ensure that the Group’s risk management and other policies are
implemented and embedded
• Consider emerging risks in the context of the Group’s
strategic objectives
• Monitor the application of risk appetite and the effectiveness of
risk management processes
• Monitor the discharge of responsibilities by operating entities
Actions
• Review of risk management and assurance activities and processes
• Respond to notifications of changing and emerging risks within its area of business responsibility
• Govern monthly/quarterly finance and performance reviews
• Review key risks and mitigation plans and consolidate Group risks
• Review the three year strategic plan
• Review results of assurance activities
• Escalate key risks to the Board
Senior Leadership
Team
Ongoing risk
assessment
Responsibilities
• Maintain an effective system of risk management and internal
control within their function/operating company
• Maintain strong and timely communication with the Executive
Committee in respect of emerging and changing risks
Actions
• Regularly review operational, project, functional and strategic risks
• Review mitigation plans
• Plan, execute and report on assurance activities as required by entity, region or group
Wilmington risk appetite
The Group’s approach is to minimise exposure to reputational, financial and operational risk, whilst accepting and recognising a risk/reward trade-off in the pursuit of its
strategic and commercial objectives.
The provision of solutions primarily to the Governance, Risk and Compliance markets means that the integrity of the business and its brands is crucial and cannot be
put at risk. Consequently, it has zero tolerance for risks relating to non-adherence to laws and regulations (‘unacceptable risk’). The business, however, operates in a
challenging and highly competitive marketplace that is constantly changing not just in regulation and legislation but also for new technology and process innovation.
It is therefore part of day-to-day planning to make certain financial and operational investments in pursuit of growth objectives, accepting the risk that the anticipated
benefits from these investments may not always be fully realised. Its acceptance of risk is subject to ensuring that potential benefits and risks are fully understood and
sensible measures to mitigate risk are established.
Risks and uncertainties facing the business continued
Risk management structure, roles and responsibilities
The Board regularly reviews the Group’s key risks and is supported in the discharge of this responsibility by various committees, specifically the Audit Committee.
The risk management roles and responsibilities of the Board, its committees and business management are set out below, and all these responsibilities have been met
during the year.
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Climate change
The Group recognises that the global climate crisis is a significant driver of future socio-economic and
environmental change, and accordingly presents potential risk to the Group’s ability to deliver its strategic
objectives.
In each year since 2022, the risk assessment and strategic planning processes includes a detailed review of
the potential risks that may arise as a result of climate change. Following the review management concluded
that impacts of climate change should continue to be high on the agenda of its strategic planning and risk
assessment processes, but should not be classified as a discrete principal risk, justified by two key outcomes:
1. The review demonstrated that the Group’s business model and strategy have an
inherent resilience to the impacts of climate change for the following reasons:
•
Lack of direct reliance on the natural resources impacted most heavily
by climate change to deliver its products;
•
Proven agility and resources to facilitate relocation of operations and events
or transition to digital alternatives if an extreme climate event occurs;
•
Presence across different markets in different locations and no significant
customer concentration in the sectors at most risk of severe disruption from
climate change; and
•
Strong alignment of its core offering to potential transition impacts
specifically in relation to new policy, regulatory change, and data and
information insights and analysis.
2. The business risks associated with climate impacts identified in the review
are strongly aligned to those that already sit on the Group’s risk register.
The potential for climate change to significantly disrupt the Group’s operations
would manifest itself either through physical disruption to our people,
customers, suppliers and their working environments or through market
disruption triggered by the transition to a low carbon economy. The risks
associated with these disruptions are specifically addressed by our existing
principal risks, and therefore the Board gained comfort that the management
of climate change risks is well aligned to, and can be effectively integrated
with, the existing principal risk mitigation strategies.
Details of the specific impacts considered and how these align to our existing
principal risk mitigation strategies are disclosed on pages 50 to 55.
Risks and uncertainties facing the business continued
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Principal risks and uncertainties
During the year 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 or
reputation. The ten key risks and uncertainties relating to the
Group’s operations, along with their potential impact and the
mitigations in place, are set out on pages 51 to 55. There may be
other risks and uncertainties besides those listed below which may
also adversely affect the Group and its performance. More detail can
be found in the Audit Committee report on pages 76 to 78.
As part of their assessment, the Directors reviewed the principal
risks in the context of their potential impact on the Group’s ability
to achieve its strategic objectives as set out on pages 7 to 12.
The Group’s sustainability strategy defines the responsible business
culture advocated by the Board that directly contributes to the
effective management of the Group’s risks, helping to enhance the
delivery of its broader strategic objectives. Therefore the four pillars
of the sustainability strategy have been mapped to any principal
risks for which the associated activities contribute a valuable
element of the mitigative action, being: Cultural positivity (‘CP’),
Customer empowerment (‘CE’), Environmental responsibility (‘ER’)
and Proactive Assurance (‘PA’).
In summary, our principal risks in the context of the strategic goals
and viability review are mapped over a three year period as follows:
9
1
2
5
10
3
4
6
7
8
Financial impact
Low
<£1m
Medium
£1-2m
High
>£2m
Low
<20%
Medium
20-80%
High
>80%
1.
Market and innovation
2.
Lack of changes to regulations and legislation
3.
People
4.
Intellectual property rights infringement
5.
Failure or significant interruption to IT systems
causing disruption to client service
6.
Technology and speed of change
7.
Remoteness of operations and globalisation
8.
Dependency on key data sources
9.
Major incidents
10. Reputational risk.
Likelihood
Risks and uncertainties facing the business continued
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Key risk 1. Market and innovation
Supporting sustainability pillar(s): CE PA
Description
The specialist markets we serve are highly competitive and experience constant changes, including
growth, decline, consolidation, and disruption. These dynamics significantly impact customer needs
and preferences.
These factors combined mean that if we do not continually innovate and invest in our business we will
not deliver the organic growth required to maintain acceptable margins and best in class returns over
the long term.
Mitigation
Product management is a key area of focus for the progression of the Group’s strategic objectives.
The Group has a dedicated New Product Development (‘NPD’) framework, managed by an
Investment Committee. The objectives of the Committee are to actively encourage innovation
whilst maintaining strong governance and rigour around internal investment and provide detailed
post‑investment appraisal.
Depending on the size of the initiatives, Board or Investment Committee approval is required to ensure
that the Group’s significant projects are aligned to the overall strategy.
Within the NPD framework, we have implemented a methodology which involves stripping back
requirements to the ‘minimum viable product’ which serves the fundamental needs of our customers
and then adopting ‘Customer Advisory Groups’ to learn what additional features would be of value to
our customers. This iterative roll-out process ensures more effective and focused product development
that continually responds to customer needs.
This approach has proven highly effective in the ongoing development of our hybrid delivery
model, and in respect of product enhancements that differentiate our offering and define our
competitive advantage.
Change since 2023
Same risk →
Supporting sustainability pillars
CP Cultural Positivity PA Proactive Assurance CE Customer Empowerment ER Environmental Responsibility
Key risk 2. Lack of changes to regulations and legislation
Supporting sustainability pillar(s): CE PA
Description
Wilmington’s businesses operate in the GRC markets. The product portfolio is therefore heavily
centred around helping customers manage the operational complexity and increased risk caused
by wide‑ranging laws, regulations and legislation.
Changes to the regulatory landscape offer opportunities for Wilmington to leverage its knowledge and
expertise to assist clients and customers with the change.
A lack of regulatory change would reduce new opportunities for growth and demand for existing
products and services.
Mitigation
We actively monitor Government regulatory bodies and relevant committees to ensure that we
understand the future landscape. This enables us to position both our existing and new products
and services to help better deliver to our clients and customers.
Local plans are updated as part of the internal strategic planning process to enable us to respond
quickly to market information and economic trends. Continual monitoring of market conditions and
market changes against our Group strategy, supported by the reforecasting and reporting in all
of our businesses, is key to our ability to respond rapidly to changes in our operating environment.
The ongoing volatility of the global economy, and associated societal impacts, indicates that continued
regulatory and legislative change is likely in the short to medium term. However, the Group continues
to innovate and diversify its product portfolio by offering more value-added products which are less
dependent on changes in regulation. A core focus of our model, and a key characteristic of our business,
is our ability to leverage our strengths to quickly adapt to changing customer requirements. This
agility has underpinned the agility of our business model to continue to deliver growth during periods
of significant uncertainty and change.
Change since 2023
Same risk →
Risks and uncertainties facing the business continued
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Key risk 3. People
Supporting sustainability pillar(s): CP ER
Description
The implementation and execution of our strategies and business plans depend heavily on our ability
to recruit, motivate and retain a diverse workforce of skilled employees and management – particularly
senior management, subject matter experts and those with technology and data analytics capabilities.
An inability to recruit, motivate or retain such people could adversely affect our business performance.
Failure to recruit and develop a diverse talent base for the Group that does not reflect the diversity
of the customers we serve could also adversely affect our reputation and business performance.
Mitigation
We advocate positive employee experience as a core priority for all parts of our business, and we have
a comprehensive People strategy to support this ambition.
The work of our People team covers an extensive range of issues that contribute to the development
of a positive culture that is vital as we attract, retain and develop talent.
The work of the People team, with the sponsorship of the Board and the Executive Committee,
delivers a wide range of services to enhance employee experience. These are underpinned by dedicated
strategies that drive progress across the following key areas of focus:
•
Diversity and Inclusion;
•
Reward and recognition;
•
Talent acquisition and development;
•
Wellbeing; and
•
Engagement.
The Group operates a competitive remuneration package that is enhanced by share plans for certain
senior management, and also operates a Save As You Earn scheme for UK employees to further align
the interests of employees and shareholders.
Change since 2023
Same risk →
Key risk 4. Intellectual property rights infringement
Supporting sustainability pillar(s): PA
Description
Protection of our intellectual property builds competitive advantage by strengthening barriers to entry.
Our intangible resources include data, processes, technological know-how, branding and our workforce.
Intellectual property rights are integral to the Group’s success.
Mitigation
We take a zero tolerance approach to any intellectual property infringement and will take all necessary
action to enforce our rights and proactively identify infringements.
Wilmington’s policy is to litigate against any infringement of our intellectual property rights.
Operating businesses are actively encouraged todevelop and protect the know-how in local
jurisdictions.
Change since 2023
Same risk →
Supporting sustainability pillars
CP Cultural Positivity PA Proactive Assurance CE Customer Empowerment ER Environmental Responsibility
Risks and uncertainties facing the business continued
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Key risk 5. Failure or significant interruption to IT systems
causing disruption to client service
Supporting sustainability pillar(s): PA
Description
Major failures in our IT systems may result in client service being interrupted or data being lost/
corrupted causing damage to our reputation and/or a decline in revenue.
There is a risk that a cyber attack on our infrastructure by a malicious individual or group could
be successful and impact critical systems used across the Group.
Mitigation
Our IT infrastructure is supported by a UK based third-party specialist, and is consistently reviewed
and improved to ensure the best quality experience for both our employees and our customers. As part
of the management strategy we have a shared hosting facility for our internal systems, giving us Tier 3
and ISO 27001 data centres for extra security and a common disaster recovery position.
We continued to focus on recruitment, retention and training of highly skilled internal IT and data
specialists to ensure we demonstrate best practice service management.
We continue to roll-out mandatory cyber security training for all staff to increase the awareness of this
increasing threat. In addition, our outsourced IT infrastructure partner proactively monitors our network
periphery for potential cyber-attacks. We also run education and simulations of cyber-attacks for staff
to further increase awareness and reduce this risk.
Specific back-up and resilience requirements are built into our systems and we are increasingly
becoming more cloud based.
Our critical infrastructure is set up so far as is reasonably practical to prevent unauthorised access and
reduce the likelihood and impact of a successful attack.
Business continuity and disaster recovery plans are in place and are assessed continually to ensure that
they cover the residual risks that cannot be mitigated.
The Group also outsources the hosting of all websites improving resilience, efficiency and scalability.
Change since 2023
Same risk →
Key risk 6. Technology and speed of change
Supporting sustainability pillar(s): PA
Description
Digital and technological transformation is now moving at a fast pace across the globe, disrupting
value chains and transcending the traditional ways of conducting business.
Digitisation continues to drive significant change in our customers’ business models, and in their
appetite for products that align to these changes. Although digital and technological transformation
offers Wilmington opportunities for growth and value creation, it comes with its own set of challenges
and risks.
The emergence of generative AI tools to create appealing products poses a risk. The power of AI to
swiftly generate innovative offerings that some customers find attractive poses a threat for Wilmington.
The misuse of AI, coupled with a lack of adequate checks and controls between businesses and
technology, can lead to significant negative impacts.
Mitigation
Our NPD process described in key risk 1 enables and encourages product innovation throughout our
business. This has improved our rate of innovation to deliver ‘client centric’ products.
Our Technology and Data teams have a significant range of valuable experience, including that gained
in mature digital organisations. We actively deliver projects in an ‘agile’ fashion using strong product
management methodologies.
The rapid digitisation of our business demonstrated our ability to rapidly adapt to change in this
area. The lessons learnt in that period of rapid transformation continue to guide our strategies
for future development and effective mitigation of the risk that we will be challenged by rapid
technological change.
Group-wide training on the appropriate use of AI, along with the implementation of formalised policies
and processes, is necessary.
Change since 2023
Increased risk ↑
Supporting sustainability pillars
CP Cultural Positivity PA Proactive Assurance CE Customer Empowerment ER Environmental Responsibility
Risks and uncertainties facing the business continued
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Key risk 7. Remoteness of operations and globalisation
Supporting sustainability pillar(s): PA
Description
A key operational risk emanates from the remoteness of operations away from key management
personnel, and from the increasing global spread of our businesses.
There is a currency risk from operating in a large number of countries.
Mitigation
Control is exercised locally in accordance with the Group’s policy of autonomous management.
We seek to employ high quality local experts.
The Executive Committee ensures that overall Group strategy is fulfilled through ongoing review of the
businesses. The creation of centrally managed and divisional level oversight of finance, technology and
people strategies provides a central insight into local operations and allows more central control than
would be possible with geographically distributed functions.
We manage currency risk in local operations by matching revenue and costs in the same currency,
closely monitoring our cash position and, where applicable, taking a low risk approach when applying
treasury policy.
Change since 2023
Same risk →
Key risk 8. Dependency on key data sources
Supporting sustainability pillar(s): PA
Description
Wilmington generates a significant amount of revenue from the sale of, or the licensed access
to, data. This data is often sourced from third parties who provide to Wilmington either exclusive
or non‑exclusive licences to use the data.
There could be a significant decrease in the Group’s revenue if Wilmington were to lose these licences
completely or in the case of exclusive arrangements if we were to lose the exclusive rights.
Mitigation
We monitor key data licence contracts across the business to ensure that all key contracts that are
close to expiring are identified as early as possible.
We have close working relationships with the third parties to these contracts and aim to start
negotiations to extend the contracts at an early stage to give Wilmington the best possible chance
of renegotiating and extending the contracts.
Change since 2023
Same risk →
Supporting sustainability pillars
CP Cultural Positivity PA Proactive Assurance CE Customer Empowerment ER Environmental Responsibility
Risks and uncertainties facing the business continued
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Key risk 9. Major incidents
Supporting sustainability pillar(s): CP PA
Description
We operate internationally and are exposed to major incidents and global events. These can be caused
by extreme weather, natural disasters, major disease outbreak, military action, civil unrest or terrorism.
In most cases, there is relatively little businesses can do to control causes of major incidents.
Major incidents have the potential to cause harm and injury to people, venues and facilities and
severely interrupt business. Our face-to-face events and training business is particularly vulnerable
to this type of risk.
Mitigation
The Group continues to carefully manage the proportion of its income generated from large face-to-
face events to reduce exposure to this risk. It also continues to focus on a hybrid delivery model for all
of its products to allow adaptation in the event of a major incident.
The Group’s events function also has event-specific strategies to mitigate the risk of disruption from
major incidents, including selecting well-connected locations with reliable infrastructure systems
and seeking flexible agreements with venues to increase the potential to transfer or postpone events
if disruption does occur.
The Covid-19 pandemic demonstrated that a major incident does have the ability to impact multiple
locations over a protracted time period. However, continued innovation and investment across the
Group have demonstrated that the ability to operate on a 100% digital basis provides significant
mitigation to this risk.
The Group assesses the value of insurance cover for cancellations on a case by case basis, to ensure
the associated cost and reliability of cover is considered economical.
Change since 2023
Same risk →
Key risk 10. Reputational Risks
Supporting sustainability pillar(s): CP PA
Description
Much of the Group’s revenue is generated by training clients in matters of Regulatory Compliance,
or by hosting events that debate such topics.
If the Group were to suffer a compliance breach itself then prospective clients may call into question
its fitness to provide such training or host such events.
The overseas entities in the Group are exposed to bribery and compliance breaches. Non-compliance
with the territories legislation could cause reputational damage to the Group.
Mitigation
The Board maintains a zero-tolerance approach to non-adherence with laws and regulations. This is
clearly communicated to employees and is reinforced through the Company’s internal communications.
The Board receives regular updates on changes to applicable legislation and regulation and plans,
both in the UK and overseas, in order to adopt them across the Group.
Individual businesses operate under specific independent brands, and this helps mitigate the potential
fall-out across the Group if there was an issue in any specific business.
The Group also has a policy to retain emails for a limit of two years to prevent loss of key data.
Change since 2023
Same risk →
Supporting sustainability pillars
CP Cultural Positivity PA Proactive Assurance CE Customer Empowerment ER Environmental Responsibility
Risks and uncertainties facing the business continued
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TCFD disclosure
Climate change
– impact and adaptation
We continue to implement the Taskforce for Climate-related
Financial Disclosures ('TCFD') recommendations in full,
while still putting together some further detail on the metric
requirements. These disclosures are consistent with the TCFD’s
recommendations and each of the 11 TCFD recommended
disclosures in accordance with LR 9.8.6 (8)R (FCA’s Listing Rules)
and are shown on pages 57 to 58. We continue to monitor the
impacts of climate change on the Group’s risk profile, and recognise
the potential opportunities that may arise from the transition to a
low‑carbon economy are well aligned to our core offering. We have
committed to net-zero carbon targets, with an ambition of absolute
zero in respect of Scope 1 and 2 emissions by 2028, and net zero
in respect of Scope 3 emissions by 2045.
We anticipate that climate change will have a wide range of impacts
on all of our stakeholders because of the strong interconnection
between environmental conditions and societal change. Therefore,
whilst our business model exhibits an inherent resilience to
the worst physical impacts of climate change, our assessment
highlighted that the transition to a lower carbon economy will have
direct implications for our core offering in the Governance, Risk and
Compliance markets, and that the broader impacts of both physical
and transition risks will affect how our people, customers and
suppliers operate effectively.
Management has concluded that its TCFD disclosures
meet the disclosure requirements of the mandatory climate
financial disclosures.
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Climate change – impact and adaptation continued
Disclosures detailing the implementation of the eleven core recommendations of TCFD are included throughout the Annual Report as follows:
Recommendation
Response
Disclosure
Governance
1.
Describe the Board’s oversight of
climate-related risks and opportunities.
Board oversight of the Group’s response to climate change sits with the Senior Independent Director, and ultimate
responsibility for management sits with the Chief Financial Officer. The Board is responsible for reviewing and challenging
ESG targets and disclosures.
Climate change impact and
adaptation pages 56 to 61
Responsible business
pages 25 to 26
Governance report
pages 67 to 75
2.
Describe management’s role in assessing
and managing climate-related risks
and opportunities.
Responsibility for day-to-day management sits with the Head of Inclusion and Sustainability, in collaboration with the
Executive Committee and Senior Leadership Team. This approach to governance is integrated with the Group’s broader
strategic planning process, its sustainability governance framework as outlined on pages 25 to 26, and the Group’s risk
assessment process as described on pages 47 to 55. The Global Sustainability Council meets quarterly and is responsible for
achieving the Group’s ESG targets and reporting progress to the Board at regular intervals throughout the year.
Climate change impact and
adaptation pages 56 to 61
Risk management
pages 47 to 55
Strategy
3.
Describe the climate-related risks
and opportunities the organisation
has identified over the short, medium,
and long term.
Our assessment identified ten potential climate change impacts that are relevant to Wilmington, and these include both
physical impacts and those related to the transition to a low carbon economy. Each impact identified has also been classified
in relation its potential to increase exposure to a risk or generate viable new market opportunities as summarised in the climate
impacts table on pages 59 to 61.
Climate change impact and
adaptation pages 56 to 61
4.
Describe the impact of climate-
related risks and opportunities on the
organisation’s businesses, strategy, and
financial planning.
The strategic and financial planning implications of each impact identified have been considered in the context of their potential
to disrupt or enhance the Group’s potential to deliver its broader strategic objectives, as summarised in the climate impacts
table on pages 59 to 61. Wilmington have assessed the risks and opportunities by operating segment and geography and
have not found the impact to be materially different across the Group.
Climate change impact and
adaptation pages 56 to 61
5.
Describe the resilience of the
organisation’s strategy, taking into
consideration different climate‑related
scenarios, including a 2°C or
lower scenario.
Wilmington have considered three climate-related scenarios with referenced data sets to provide insight into the indicative
socio-economic conditions that would result from different levels of warming and the related policy outcomes on the
organisations strategy. Details are provided on page 61.
Climate change impact and
adaptation pages 56 to 61
TCFD disclosure continued
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Recommendation
Response
Disclosure
Risk management
6.
Describe the organisation’s processes
for identifying and assessing climate-
related risks.
The process for identifying, assessing and managing climate-related risks is integrated into Wilmington’s overall risk
management process as described on page 49. Climate change is recognised as an emerging risk as described on page 49.
Climate change impact and
adaptation pages 56 to 61
Risk management
pages 47 to 55
7.
Describe the organisation’s processes
for managing climate-related risks.
Climate-related risks are identified through research, stakeholder engagement and internal risk workshops and are reviewed
on an annual basis or more frequently if required. Risks are modelled in different regions where appropriate if physical risk
varies by geographical location.
Climate change impact and
adaptation pages 56 to 61
Risk management
pages 47 to 55
8.
Describe how processes for identifying,
assessing, and managing climate-related
risks are integrated into the organisation’s
overall risk management
Climate-related risks are recognised as a contributing factor to a number of our principal risks as identified on pages 49 to 50.
Where a climate-related risk aligns strongly to one of the Group’s existing risks and associated mitigation strategies, it has
been mapped to the relevant principal risk as shown on the climate impact table on page 60. Each impact identified has been
classified in relation its potential to increase exposure to a risk or generate viable new market opportunities as shown on the
climate impact table on page 60.
Climate change impact and
adaptation pages 56 to 61
Risk management
pages 47 to 55
Metrics and targets
9.
Disclose the metrics used by the
organisation to assess climate-related
risks and opportunities in line with its
strategy and risk management process.
We use a variety of metrics to measure climate-related impacts. Our reporting on energy use and GHG emissions is in line
with the Streamline Energy and Carbon Reporting (‘SECR’) legislation. Our GHG reporting to include Scope 1, 2 and 3
emissions in line with Science Based Targets initiative recommendations.
We have set net-zero carbon targets with a 2019 baseline year, aligned to a 1.5°C trajectory, and have developed a carbon
reduction plan to progress against these goals.
Our biggest direct impacts on the planet come from resource use and emissions from our offices, and we continue to focus
on transitioning to sustainable materials and methodologies to reduce this impact. Details of these metrics and initiatives can
be found on pages 39 to 42.
Climate change - impact and
adaptation pages 56 to 61
Responsible business
pages 25 to 26
10. Disclose Scope 1, Scope 2, and,
if appropriate, Scope 3 greenhouse gas
('GHG') emissions, and the related risks.
Reporting on energy use and GHG emissions including Scope 1, 2 and 3 emissions and the related risks can be found
on pages 39 to 42.
Responsible business
pages 25 to 26
11. Describe the targets used by the
organisation to manage climate-related
risks and opportunities and performance
against targets.
Wilmington have committed to net-zero carbon targets, with an ambition of absolute zero in respect of Scope 1 and 2
emissions by 2028, and net zero in respect of Scope 3 emissions by 2045, as described on pages 39 to 42.
Responsible business
pages 25 to 26
Climate change – impact and adaptation continued
TCFD disclosure continued
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Impact assessment
Our assessment identified ten potential climate change impacts that are relevant to Wilmington,
and these include both physical impacts and those related to the transition to a low carbon
economy. The strategic and financial planning implications of each impact identified have been
considered in the context of their potential to disrupt or enhance the Group’s potential to deliver
its broader strategic objectives, as summarised on pages 56 to 61. Where a climate-related risk
aligns strongly to one of the Group’s existing risks and associated mitigation strategies, it has
been mapped to the relevant principal risk. Each impact identified has also been classified in
relation its potential to increase exposure to a risk or generate viable new market opportunities.
Classification
Exposure:
effectiveness of
risk mitigation
Potential: result
of associated
opportunity
Low
Prevent material impact on
strategic progress.
Unlikely to generate
financial returns.
Moderate
Reduce extent of material
impact on strategic progress.
Could generate immaterial
financial returns.
High
Failure to prevent material
impact on strategic progress.
Could generate material
financial returns.
Quantifying the impacts
The focus of our assessment has been to perform a robust qualitative analysis that can be used
to effectively inform our response to climate change as an integral part of the Group’s strategic
planning processes. Whilst we have not quantified these impacts specifically, the nature of the
most relevant issues identified aligned strongly to those assessed as part of the Group’s viability
assessment. As disclosed on page 62, as part of this assessment we modelled the potential
financial impacts of the Group’s principal risks over a three year period. Reference to this
viability testing therefore provided scope to validate the reasonableness of our assumptions
regarding which climate impacts could have a material impact on the financial returns of
the Group in the short term (1 to 3 years). Whilst the medium (4-10 years) and long term
(10 years and beyond) implications have not been quantified, the assessment and scenario
planning analysis have demonstrated that the nature of the impacts would be strongly
aligned over these time periods. Not disclosed is information on the relevant metrics
as set out in Table A2.1 in the TCFD guidance and information about the metrics that
management use to measure progress to their environmental goals.
TCFD disclosure continued
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Climate impacts
Exposure/Potential
Strategic implications and response summary
Physical
impacts
Extreme climate events disrupt office and
homeworking infrastructure
Risk: Low
Opportunity: N/A
Inherent resilience through agile workforce and hybrid working practice. Continue to invest in technological capabilities and review resilience of office
infrastructure as part of ongoing strategic planning and capital investment processes. Maintain strong employee engagement and support.
Principal risk alignment: 3 – People, 5 – IT system disruption, 9 – Major incidents
Extreme climate events disrupt
face‑to‑face events or training, and
business development opportunities
Risk: Low
Opportunity: N/A
Inherent resilience due to digital-first model and hybrid delivery capabilities. Continue to follow risk mitigation plan integrated into face-to-face events
planning process. Continue to factor potential costs of transition to virtual alternatives into budgetary planning process.
Principal risk alignment: 5 – IT system disruption, 6 – Technology, 9 – Major incidents
Sector specific physical impacts disrupt
customers in high exposure categories
Risk: Low
Opportunity: Moderate
Relatively low customer concentration in high exposure categories. Requirement for regulatory insight and training likely to increase due to climate
change triggering further reliance on our services. Continue to innovate and provide mission critical information and training to customers to protect
revenue streams.
Principal risk alignment: NA
Extreme climate events cause supply
chain disruption
Risk: Low
Opportunity: N/A
Inherent resilience through low supplier concentration and limited reliance on raw materials. Continue to assess viability risk of material suppliers in line
with risk policy
Principal risk alignment: 5 – IT system disruption
Transition
impacts
Transition to low carbon economy
triggers shift in customer markets
Risk: Low
Opportunity: High
Strong alignment to GRC markets focus. Maintain strong communication channels with customers and continue to innovate to meet changing needs.
Integrate climate-related content and solutions into core data and training products. Successful realisation of opportunities is dependent on talent,
innovation and operational effectiveness.
Principal risk alignment: 1 – Market and innovation, 3 – People, 6 – Technology, 8 – Data source reliance
Changing attitudes to business travel
Risk: Low
Opportunity: N/A
Inherent resilience due to digital-first model. Maintain flexibility to offer hybrid delivery and focus on quality in digital alternatives to face-to-face
products. Maintain strong communication with customers via virtual formats.
Principal risk alignment: 5 – IT system disruption, 6 – Technology
Evolution of carbon taxes
Risk: Low
Opportunity: Moderate
Limited exposure due to industry focus. Maintain strong visibility of potential future cost and compliance implications as part of budgetary planning
processes. Maintain focus on updating core product offering to align to associated regulatory change.
Principal risk alignment: 10 – Reputation
Policy change regarding
domestic infrastructure
Risk: Low
Opportunity: N/A
Exposure limited to workforce disruption caused by domestic infrastructure changes. Continue to provide office premises for effective operations,
and maintain commitment to Real Living Wage.
Principal risk alignment: 3 – People
Increased corporate reporting
requirements
Risk: Low
Opportunity: High
Limited exposure due to strong internal reporting processes. Maintain strong internal processes to ensure timely integration of policy change into
training material and associated services.
Principal risk alignment: 1 – Market and innovation, 2 – Regulation
Stakeholder expectations of
Wilmington’s response to climate change
Risk: Low
Opportunity: High
Limited exposure due to strong commitment to participation in the climate agenda. Future talent attraction and retention, and good customer
engagement will be significantly enhanced by clear demonstration of our commitment to environmental responsibility.
Principal risk alignment: 3 – People 10 – Reputation
Climate impacts and response summary
TCFD disclosure continued
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Scenario analysis
As part of our climate impacts assessment we considered the potential for the risks and opportunities identified to vary depending on different future scenarios.
The differentiating factors most relevant to our business are the severity of physical impacts on our people and other stakeholders, and the speed, nature and impact
of regulatory change. Therefore our approach to selecting illustrative scenarios was to ensure our analysis encompassed the most extreme cases in respect of these two
variables. Accordingly, we have used three scenarios which reflect reference to three core SSPs1 used within the IPCC2 Sixth Assessment Report in addition to qualitative
analysis by the IEA3 to provide insight into the indicative socio-economic conditions that would result from different levels of warming, and the related policy outcomes.
A summary of these scenarios and indicative socio-economic conditions is provided below.
1. Shared Socio-Economic Pathway.
2. Intergovernmental Panel on Climate Change.
3. International Energy Agency.
Future focus
Our assessment has demonstrated that the climate-related impacts most relevant to Wilmington align strongly to the Group’s principal risks that consider disruption
to operational effectiveness, and our ability to lead in product innovation and the delivery of excellent customer experience. The assessment also demonstrates that the
needs of our customers during the transition to a lower carbon economy will strongly align to our core offering in Governance, Risk and Compliance. This assessment
also concluded that there is no indication of material financial exposure to the climate-related risks identified.
The Board therefore consider the Group to be well positioned to meet its strategic objectives by continuing to integrate its assessment of climate change impacts into
its existing risk management and strategic planning processes, ensuring it retains the agility to respond in a way that achieves the best outcomes for all its stakeholders.
Indicative
assumptions
Scenario 1
Scenario 2
Scenario 3
Related SSP
1 – 1.9
1 – 2.6
5 – 8.5
Temperature rise trajectory
1.5°C
<2°C
6°C
Policy change
Significant and timely
decarbonisation policy
implementation.
Transition towards
decarbonisation focused
policy implementation.
Business as usual, reactive
change only.
Customer impact
Significant and timely
adaptation. Demand for GRC
solutions increases.
Transition towards adaptive
measures. Demand for GRC
solutions increases.
Significant disruption
from physical risks diverts
resource.
Innovation and adaptation
Investment facilitates
streamlined transition to low
carbon economy.
Heavy reliance on good
adaptive technologies to
facilitate transition to low
carbon economy.
Limited and delayed
investment in adaptive
technologies.
The below chart provides an illustrative summary of the implications
for potential outcomes in respect of the climate change impacts most
relevant to Wilmington’s strategy for each of the three scenarios.
SC3
SC2
SC1
Likelihood and magnitude of physical
impacts disrupting operations
Potential to capitalise on
opportunities from regulatory change
Low
Low
Moderate
High
Moderate
High
TCFD disclosure continued
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Viability statement
Assessing the future prospects of the Group is integral to the Board’s business
planning process, and is also closely aligned to the risk management process
as detailed on pages 47 to 50. The planning process includes detailed financial
forecasting, regular performance analysis, robust risk management assessment,
and continued monitoring of industry trends and wider economic conditions.
In the context of the challenging economic environment in which the Group
operates, the Board has performed a detailed assessment to conclude on:
•
The appropriateness of adopting the going concern basis in preparing the
financial statements for the year ended 30 June 2024, as disclosed in note 1
to the financial statements; and
•
The long-term viability of the Group, up to September 2027.
Full details of the Group’s financing arrangements are set out in note 18 to the
financial statements.
Viability
In accordance with Provision 31 of the UK Corporate Governance Code 2018, the
Directors have considered the prospects of the Group over a longer period than
the twelve months required under the going concern provision. The Directors have
determined that a three-year period is an appropriate term over which to provide
its viability statement, being consistent with that covered by the Group’s strategic
planning process which includes broader consideration of the Group’s principal
risks and uncertainties over the same period. The Directors also consider the
business to be sufficiently agile to respond to volatility over a longer time frame
in a way that would mitigate potential unforeseen downside.
Assessment process
The Group’s viability assessment has taken account of its current position and the
potential impact of the principal risks documented on pages 47 to 50. The review
has focused on the occurrence of severe but plausible scenarios in respect of every
principal risk and considered the potential of these scenarios to threaten viability.
The financial impact of each scenario was quantified where appropriate, and
subsequently mapped to a set of mitigative actions that would be taken to manage
the risk. Stress testing analysis was also performed, illustrating the ability of the
Group to manage the impact of severe downside scenarios on its future financial
position. The severe downside scenarios considered as part of this work were
as follows:
•
Aggressive recessionary impacts on revenue across the whole
product portfolio.
•
Nil growth within businesses projected to benefit from new product
development.
•
Extreme events disrupting the workforce, customers and suppliers.
•
Cancellation of flagship events and assumed non-viability of alternatives.
The outcome of this assessment indicated that the Group’s risk management
process, control systems and current risk appetite are sufficiently robust that a
comprehensive response strategy could be actioned to protect the prospects of the
Group in the event of such scenarios occurring.
On this basis the Directors have a reasonable expectation that the Group will
be able to continue in operation and meet its liabilities as they fall due over the
viability assessment period.
Viability statement
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Internal control
The Board is responsible for the Group’s system of internal control and risk
management, and for reviewing the effectiveness of these systems. These systems
are designed to manage, rather than eliminate, the risk of failure to achieve business
objectives, and to provide reasonable, but not absolute, assurance against material
misstatement or loss.
In line with the Turnbull Report recommendations, the Board regularly reviews the
effectiveness of the Group’s systems of internal control. The Board’s monitoring
covers all controls, including financial, operational and compliance controls and
risk management. It is based principally on reviewing reports from management
to consider whether significant risks are identified, evaluated, managed
and controlled.
Further details of principal risks are given on pages 47 to 55 and details of
financial risks such as interest rate risk, liquidity risk and foreign currency risk are
given in the financial statements in note 18.
The key features of the internal financial control system that operated throughout
the period are as follows:
i) Financial reporting
The Board reviewed the Annual Report, together with the preliminary and
interim results announcements. The Board also reviews and approves Trading
Announcements (as appropriate).
The Board, together with the Audit Committee, considered the appropriateness
of the Group’s accounting policies, critical accounting estimates and key
judgments. It reviewed detailed accounting papers prepared by management
on areas of financial reporting judgment, as outlined in the Audit Committee
report on pages 76 to 78.
The Board together with the Audit Committee considered and is satisfied that,
taken as a whole, the Annual Report is fair, balanced and understandable, and
that it provides the information necessary for shareholders to assess the Group’s
performance, business model and strategy.
ii) Management information systems
Effective planning, annual budgeting and monthly forecasting systems are in place,
as well as a monthly review of actual results compared with forecast, budget and
the prior year. The annual budget and monthly forecasts are reviewed by the
Board. Risk assessment and evaluation takes place as an integral part of this
process. Monthly reports on performance are provided to the Board and the Group
reports results to shareholders twice a year.
Insurance cover for the Group, as well as individual operating companies, has been
procured where it is considered appropriate.
iii) Acquisitions, disposals and treasury
The Board also discusses in detail the projected financial impact of proposed
acquisitions and disposals, including their financing. All such proposed
investments are considered by all Directors. The Board is also responsible for
reviewing and approving the Group’s treasury strategy, including mitigation against
changes in interest rates and foreign exchange rates.
Organisations
There are well-structured financial and administrative functions at both
the Group and operating company level, staffed by appropriately qualified
individuals. The key functions at Group level include: Group accounting, corporate
development, Group treasury, Group legal, human resources, IT and data services,
company secretarial and Group taxation.
Other matters
The Group has no known issues relating to human rights or modern slavery
matters. The welfare of all the Group’s stakeholders, including the community,
is carefully considered to ensure that such parties are not adversely affected by
the Group’s actions in the course of its day-to-day business. Further details of
the Group’s stakeholder engagement processes can be found in the Section 172
statement on pages 21 to 24.
The information forming the Strategic report on pages 3 to 63 was approved and
authorised for issue by the Board and signed on its behalf on 08 October 2024.
Guy Millward
Chief Financial Officer
08 October 2024
Viability statement continued
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Our Governance
Contents
Board of Directors. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . [65
Corporate Governance report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 67
Audit Committee report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 76
Nomination Committee report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 79
Directors’ Remuneration report. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 81
Directors’ report and other statutory information. . . . . . . . . . . . . 104
Statement of Directors’ responsibilities. . . . . . . . . . . . . . . . . . . . . . 106
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Committee key:
Audit Committee
Nomination Committee
Remuneration Committee
Committee Chair
Martin Morgan
Chair
Appointment to the Board
May 2018
Skills and experience
Martin Morgan has over 30 years of media and
B2B experience, having spent a large proportion
of his career at Daily Mail and General Trust
plc (‘DMGT’). Martin was Chief Executive of
DMG Information and subsequently held the
position of Chief Executive of DMGT from 2008
to 2016. He brings a wealth of experience
from subsequent directorships, including the
positions of Non-Executive Director of Euromoney
Institutional Investor plc between 2008 and 2016
and Chair of Signal Media Limited between 2017
and 2019.
Other appointments
Martin is currently an Advisor to MMC Ventures
and a Non-Executive Director to Morgan
Hartnell Limited.
Mark Milner
Chief Executive Officer
Appointment to the Board
July 2019
Skills and experience
Mark Milner joined Wilmington from the
Daily Mail and General Trust plc (‘DMGT’)
where since 2001 he held a number of senior
roles. These included Chief Executive Officer
of Landmark Information Group, its property
information division, from 2013 to 2018. Prior
to this, Mark was Chief Executive Officer of
the Digital Property Group, responsible for
running its consumer-focused property portals,
PrimeLocation, Findaproperty and Globrix until
its merger with Zoopla in 2012. Between 2001
and 2008 Mark held a variety of positions at
Associated Northcliffe Digital Ltd, becoming
Managing Director of the specialist division.
Whilst there he was involved in the launch of
Mail Online, which subsequently became the
world’s most visited English language news site.
Mark’s early career was spent in commercial and
sales roles in the newspaper industry.
Other appointments
On 29 July 2024, Mark was appointed
as a Non-Executive Director of Idox plc.
Guy Millward
Chief Financial Officer and Company
Secretary
Appointment to the Board
November 2020
Skills and experience
Guy Millward has extensive experience in
senior finance positions at several publicly
listed and privately held technology companies.
His previous roles include that of CFO at
Imagination Technologies Group plc, Advanced
Computer Software Group plc, Quixant plc,
Metapack Limited, Bighand Limited, and Group
Finance Director at Alterian plc, Morse plc and
Kewill plc. Guy is a Fellow of the Institute of
Chartered Accountants in England and Wales.
Other appointments
Guy is currently a Non-Executive Director and
Chair of the Audit Committee at Eckoh plc.
Helen Sachdev
Independent
Non-Executive Director
Appointment to the Board
April 2020
Skills and experience
Helen brings a wealth of experience to
Wilmington via her Non-Executive and
Executive career. She is a founding director of
the B2B executive coaching practice, WOMBA
(Work, Me and the Baby) and a former executive
of Tesco and Barclays Bank PLC (where she
also sat on the UK D&I Board). She is senior
executive coaching practitioner (EMCC) and a
Fellow of the Chartered Institute of Management
Accountants (FCMA).
Helen Sachdev will replace Paul Dollman as
Senior Independent Director on 08 October 2024.
Other appointments
Helen is a Non-Executive Director and Chair
of the Loughborough Building Society.
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Committee key:
Audit Committee
Nomination Committee
Remuneration Committee
Committee Chair
Paul Dollman
Independent
Non-Executive Director
Appointment to the Board
September 2015
Skills and experience
Paul Dollman is a Chartered Accountant and
enjoyed a successful career in finance as the
Group Finance Director of John Menzies plc.
He was also a Non-Executive Director of Air
Partner plc, an aviation services business,
where he was the Audit Committee Chair until
April 2022. Paul is the Senior Independent
Director (‘SID’). Paul Dollman will stand
down from the Board on 08 October 2024
after completion of his full nine-year term
as Independent Non‑Executive Director.
Other appointments
Paul is a member of the
Competition Appeals Tribunal.
William Macpherson
Independent
Non-Executive Director
Appointment to the Board
February 2021
Skills and experience
William Macpherson brings a wealth of
experience to Wilmington following a
successful executive career as CEO of a
number of professional education and skills
development organisations. He was CEO of QA
between 2008 and 2019 during which time
the company achieved very significant growth.
Prior to that he was CEO of Kaplan International,
The Financial Training Company and Wolters
Kluwer Professional Training. William is the
Director responsible for worker representation
at Wilmington.
Other appointments
William is a Non-Executive Director and
Chair of Learning Curve Group Limited
and a Non‑Executive Director of the
London Film School.
Sophie Tomkins
Independent
Non-Executive Director
Appointment to the Board
April 2024
Skills and experience
Sophie Tomkins joined the Board on 23 April
2024 and will be appointed as Chair of the
Audit Committee on 08 October 2024. Sophie is
a Chartered Accountant and member of the
ICAEW. Sophie brings a wealth of experience
and relevant expertise, both from the financial
markets and as a Non-Executive Director. She
has worked at a number of financial institutions
including Fairfax, Collins Stewart and Cazenove,
and was previously a Non-Executive Director of
Hotel Chocolat Group plc, the SnowFox Group,
Cloudcall Group plc and Proactis Holdings plc.
Other appointments
Sophie is a Non-Executive Director and Audit
Committee Chair of Virgin Wines UK plc and
a Non-Executive Director, Audit Committee
Chair and Senior Independent Director of
System1 Group plc.
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Corporate Governance report
sits at the heart of our approach to management
at all levels, facilitating sustainable growth
that delivers positive outcomes for all of the
Group’s stakeholders.
By promoting a responsible business culture we
continue to demand the highest professional
standards from all of our people all of the time.
To reinforce that we have a comprehensive portfolio
of policies accessible to all staff to support their
day‑to-day decision making. We have a zero
tolerance approach to breaches of the conduct
standards set out in these policies.
Further details of the work that underpins our
approach to responsible business are set out in the
Sustainability report on page 25.
Compliance with the 2018 UK
Corporate Governance Code
The Group abides by the 2018 UK Corporate
Governance Code published by the Financial
Reporting Council (‘FRC’). The Board has put in place
provisions to ensure compliance with the Code and
as such is fully compliant. The Corporate Governance
report seeks to support shareholders and investors to
evaluate how the Company has applied the principles
of the Code and complied with the provisions of the
Code during the year ended 30 June 2024. The board
recognised that the Financial Reporting Council
published a revised version of the Code on 22 January
2024. These updated guidelines will become effective
for financial years commencing on or after 1 January
2025. The Company will report against the updated
version of the Code in due course.
Details of how the principles of the Code have been
applied can be found throughout the Annual Report
as detailed to the right.
Principles of the Code
Page(s)
1. Board leadership and Company purpose
Board of Directors
65 to 66
Purpose values and culture
21 to 26, 68, 74
Stakeholder engagement
21 to 26
Risk management
47 to 55
Key performance indicators
19 to 20
2. Division of responsibilities
Roles of the executive team,
governance structure and
independence
65 to 70
Board and Committee meeting
attendance
72, 76, 79, 84
Committee reports and
time commitment
69 to 73
3. Composition, succession and evaluation
Nomination Committee report
79 to 80
4. Audit, risk & internal control
Audit Committee report
76 to 78
Statement of Directors’
responsibilities
106
Risks and uncertainties facing the
business
47 to 55
Going concern statement
130 to 131
Viability statement
62 to 63
5. Remuneration
Directors’ remuneration report
81 to 103
Chair’s introduction
Responsibility for good governance lies with the
Board. As a Board we are committed to maintaining
the highest standards of corporate governance and
believe that an effective, challenging and diverse
board is essential to enabling the Group to deliver
its strategy and achieve long term value for its
stakeholders. Further information on our strategy and
business model can be found in the Strategic report
on pages 7 to 12.
The Board is dedicated to setting the right tone
at the top by promoting an inclusive culture that
fosters innovation, ambition and curiosity whilst
demonstrating the highest standards of integrity.
Our robust governance structure, combined with
our commitment to responsible business practice,
Demonstrating
good governance
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Stakeholder engagement
(Section 172 of the
Companies Act 2006)
The Board has always considered the potential impact
of the Group’s activities on its various stakeholders.
The key stakeholders of the Group are set out in
the Strategic report on pages 22 to 23, which
also includes information about how the Company
engages with them and how the Directors, supported
by the wider business, show regard for the matters
set out under Section 172 of the Companies Act
2006. The Board believes that the Company can
only be successful when the interests of these
stakeholders are considered, and reflected accordingly
in the Company’s decision making processes and
strategic objectives.
The Board regards it as important to maintain an
active dialogue with our shareholders. Further details
regarding engagement with shareholders are set out
on pages 21 to 24. The Board receives regular reports
from the Executives, the Chair and the advisors on
feedback from shareholder meetings.
Composition and independence
The composition of the Board is currently undergoing
change. The Board was pleased to welcome
Sophie Tomkins as a Non-Executive Director with
effect from 23 April 2024. Sophie is a Chartered
Accountant bringing a wealth of experience and
relevant expertise, both from the financial markets
and as a Non-Executive Director. Paul Dollman
Senior Independent Director and Chair of the
Audit Committee will stand down from the Board on
08 October 2024 after completion of his full nine‑year
term as Independent Non‑Executive Director. On
08 October 2024, Paul Dollman will be
replaced as Senior Independent Director
by Helen Sachdev and Chair of the
Audit Committee by Sophie Tomkins.
The Board reviews Non-Executive
Director independence on an
annual basis and takes into account
the individual’s professional
experience, their behaviour at Board
meetings and their contribution
to unbiased and independent
debate. All of the Non-Executive
Directors are considered by the
Board to be independent. The Chair
was considered independent
on appointment.
The Board consisted of a majority
of Independent Non-Executive
Directors throughout the year.
Biographical details of all the
current Directors are set out
on pages 65 to 66.
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Governance Framework
Board: Chair, two Executive Directors and four Non-Executive Directors
Audit Committee
Nomination Committee
Chief Executive Officer
Remuneration
Committee
Executive Committee: Chief Executive Officer, Chief Financial Officer,
Chief Operating Officer and Chief People Officer
Business/Divisional operating boards
Chair
Length of tenure of Directors (years)
Number of complete years of service as a Director
at 1 July 2024:
Martin Morgan • • • • • •
Mark Milner • • • • •
Guy Millward • • •
Helen Sachdev • • • •
Paul Dollman • • • • • • • •
William Macpherson • • •
Sophie Tomkins
Balance of Directors
14%
29%
57%
Chair
•
Executive
•
Independent Non-Executive
•
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The Board has published gender identity and ethnic diversity of the Directors and senior leadership team below.
Despite a year-on-year improvement, the comply or explain specific board diversity targets have not been met
as at 30 June 2024. The Board recognises the importance of ensuring that there is diversity of perspective,
background, and approach in its management team and on its Board and will take the diversity targets into
consideration for future Board appointments. It is the Board’s aspiration that it will meet the board diversity
targets by FY26.
Senior Leadership composition
The table below outlines the gender identity and ethnicity as disclosed voluntarily by the Directors and the Senior
Leadership Team, including the Executive Committee. Data is collected via a survey for gender and ethnicity.
The diversity characteristics of the wider workforce and further information about the work we are doing to
increase diversity at all levels across the Group are disclosed in the Sustainability report on pages 25 to 42.
Gender
Male
Female
Non‑binary
Prefer to
self-describe
Prefer not
to say
Directors
2024
71%
29%
0%
0%
0%
2023
83%
17%
0%
0%
0%
Senior Leadership Team
2024
64%
36%
0%
0%
0%
2023
45%
56%
0%
0%
0%
Ethnicity
White
Asian/Asian
British
Black/African/
Caribbean/
Black
British
Mixed/Multiple
Ethnic
groups
Other ethnic
group,
including
Arab
Other1
Prefer not
to say
Directors
2024
100%
0%
0%
0%
0%
0%
0%
2023
100%
0%
0%
0%
0%
0%
0%
Senior Leadership Team
2024
91%
9%
0%
0%
0%
0%
0%
2023
83%
8%
0%
0%
0%
8%
0%
Governance Framework continued
Diversity
The Board believes that an inclusive culture will
enhance diversity within our business, which in turn
is a key factor driving the Group’s success. Our vision
is for Wilmington to be a company with rich diversity,
experiences, knowledge and perspectives, which
powers our innovation and creativity to help our
customers to do the right business in the right way.
During the year we continued to make progress
against our People Strategy, delivering initiatives and
making changes to the way that we work, so that
we continue to create an inclusive workplace to
support, empower, develop and fairly reward all our
people. This is reflected in our progress implementing
our Diversity and Inclusion strategy and by our
investments in creating a positive environment for all
our people to reach their full potential at Wilmington.
This is underpinned by the data we collect about our
people, which enables us to understand and measure
diversity and inclusion at Wilmington; using data to
guide our strategy and areas of focus. By asking our
people to share their diversity data, we have a rich
picture of the characteristics that make our people
unique, and this in turn is helping us to measure
progress against our ambition to create a truly
inclusive working environment. The data we have
collected to better understand what makes our people
unique is set out alongside details of the progress
made against our Diversity and Inclusion strategy
in the Sustainability report on pages 25 to 42.
Diversity targets
The Board acknowledges the board diversity targets
per listing rules LR 9.8.6R(9) and LR 14.3.33R(1).
1. Other includes individuals based in territories where we were unable to collect data due to relevant local legislative factors.
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The Directors
As at the date of this report the Directors of the
Company are:
Chair
Martin Morgan
Executive Directors
Mark Milner
Guy Millward
Independent Non-Executive
Paul Dollman (Senior Independent Director)
Helen Sachdev
William Macpherson
Sophie Tomkins
Leadership
Executive and Non-Executive Directors
The Company is controlled through the Board of
Directors which, at 30 June 2024, comprised a Chair,
two Executives and four Non-Executive Directors.
Short biographies of each Director are set out on
pages 65 to 66. The Board focuses on the formulation
of strategy, governance and the establishment
of policies, stewardship of resources and review of
business performance.
The Board may exercise all the powers of the
Company, subject to the Company’s articles of
association (the ‘Articles’), the Companies Act 2006
and any directions given by the shareholders by
special resolution. The Articles may be amended
by a special resolution of the Company’s shareholders.
The Board meets as often as necessary to discharge
its duties effectively. In the financial year ended
30 June 2024, eight main Board meetings were
scheduled and the Directors’ attendance record is set
out on page 72.
The Board has three formally constituted Committees,
the Audit Committee, the Remuneration Committee
and the Nomination Committee, each of which
operates with defined terms of reference. The terms
of reference of the three Committees are available
on the Company’s website, www.wilmingtonplc.com.
The Audit Committee met three times during the
year, the Nomination Committee met once, and the
Remuneration Committee met three times.
There is an Executive Committee that is responsible
for the day-to-day management of the Company’s
business within a framework of delegated
responsibilities. It is chaired by the Chief Executive
Officer and includes the Chief Financial Officer,
Chief Operating Officer and Chief People Officer.
Chair and Chief Executive Officer
The roles of the Chair and the Chief Executive Officer
are held by separate individuals and the Board has
clearly defined their responsibilities.
The Chair is primarily responsible for the effective
working of the Board, ensuring that each Director,
including the Non-Executive Directors, is able to make
an effective contribution and provide constructive
comments on the business. The Chief Executive
Officer has responsibility for all operational matters
which includes the implementation of Group strategy
and policies approved by the Board.
Non-Executive Directors
All the Non-Executive Directors are independent
of the Company’s executive management and
free from any business or other relationship that
could materially interfere with the exercise of their
independent judgment. The Chair was considered
independent on appointment. The Non-Executive
Directors are responsible for bringing independent and
objective judgment and scrutiny of all matters before
the Board and its Committees, using their substantial
and wide‑ranging experience.
The terms and conditions of appointment of Non-
Executive Directors are available for inspection at the
Company’s registered office during normal business
hours and at the Annual General Meeting.
Senior Independent Director
Paul Dollman is the Senior Independent Director
(‘SID’). His role as SID includes:
•
being available to shareholders if they have
concerns which contact through the Chair,
Chief Executive Officer or Chief Financial Officer
has failed to resolve (there were no requests from
shareholders to meet the SID during the year); and
•
meeting with the other Non-Executive Directors
on the Board once a year to assess the Chair’s
performance, taking into account the views of the
Executive Directors.
Helen Sachdev will replace Paul Dollman as Senior
Independent Director on 08 October 2024.
Company Secretary
Guy Millward is the Company Secretary in addition
to his role as an Executive Director. In his role as
Company Secretary, he supports the Board in its
operation and ensures that board processes are
followed and good corporate governance standards
are maintained. All Directors have access to the advice
and services of the Company Secretary. The Board
recognises the potential conflict in combining the roles
of Chief Financial Officer and Company Secretary, but
believes it is appropriate for a group of Wilmington’s
size given the other support available to the Directors.
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Effectiveness
Meetings
The Board has a formal schedule of matters
specifically reserved to it for decision which it reviews
periodically. This schedule includes approval of
acquisitions, disposals and items of major capital
expenditure. The Board also reviews the Group’s risk
register, wider risk assessment and viability review.
At each Board meeting the Chief Executive Officer
and Chief Financial Officer provide a review of the
business and its performance, together with strategic
issues arising. The Non-Executive Directors may meet
separately from the Executive Directors usually either
before or after Board meetings, to discuss relevant
matters. In the year the range of subjects discussed
by the Board included:
•
the Group’s financial results and key business;
•
progress on the ongoing strategic reviews;
•
the Group’s capital structure including the
arrangements for sufficient debt facilities;
•
dividend policy;
•
regulatory and governance issues;
•
the development of the Group’s people including
a quarterly talent review;
•
the Group’s risk register and its response to TCFD
recommendations; and
•
insurance policy and cover.
In addition to the eight main meetings described
above, the Board has two strategy meetings each year
at which the Group’s strategic direction, viability plan
and significant projects are discussed.
Where additional meetings are required between
main Board meetings and a full complement
of Directors cannot be achieved, a Committee
of Directors considers the necessary formalities.
Attendance table
Main Board
meetings
attended
Main Board
meetings
eligible to
attend
Martin Morgan
(Chair)
10
10
Mark Milner
(Chief Executive Officer)
10
10
Guy Millward
(Chief Financial Officer)
10
10
Paul Dollman
(Non-Executive)
10
10
Helen Sachdev
(Non-Executive)
10
10
William Macpherson
(Non-Executive)
10
10
Sophie Tomkins
(Non-Executive)
3
3
Information flow
The Chair, together with the Company Secretary,
ensures that the Directors receive clear information on
all relevant matters in a timely manner. Board papers
are circulated sufficiently in advance of meetings for
them to be thoroughly digested to ensure clarity of
informed debate. The Board papers contain the Chief
Executive Officer’s and the Chief Financial Officer’s
written reports, high level papers on each business
area, key metrics and specific papers relating to
agenda items. The Board papers are accompanied
by a management information pack containing
detailed financial and other supporting information.
The Board receives updates throughout the year and
occasional ad hoc papers on matters of particular
relevance or importance.
Time commitment
The Board is satisfied that the Chair and each of the
Non-Executive Directors committed sufficient time
during the year to enable them to fulfil their duties as
Directors of the Company. None of the Non-Executive
Directors have any conflicts of interest.
Induction and professional development
The Chair is responsible for ensuring that induction
and training are provided to each Director and for
organising the induction process and regular updating
and training of Board members.
Training and updates in relation to the business of the
Group and the legal and regulatory responsibilities
of Directors were provided throughout the year
by a variety of means including presentations by
executives, visits to business operations, external
presentations and circulation of briefing material.
Individual Directors are also expected to take
responsibility for identifying their training needs and
ensuring they are adequately informed about the
Group and their responsibilities as a Director. The
Board is confident that all its members have the
knowledge, ability and experience to perform the
functions required of a Director of a listed company.
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Access to independent advice
Any Director who considers it necessary or
appropriate may take independent, professional
advice at the Company’s expense. None of the
Directors sought such advice in the year.
Board evaluation and performance review
Towards the end of the financial year, the Board
conducted an internal annual evaluation of its own
performance, of each of its sub-committees and of each
individual Director. The Board considered the need for
external facilitation of this process but decided it was
unnecessary at this stage in its development.
The Board evaluation was led by the Chair.
He conducted one-to-one interviews with
each of the Directors, and then reported to the
Nomination Committee where his findings were
considered. The review concluded that the Board,
its sub‑committees and each of the Directors
continued to be effective. The Board recognises D&I
benchmarks and noted that its diversity did not fully
reflect the position across the Group and resolved
to consider this when making new appointments.
Nomination Committee
The Nomination Committee and the Board seek
to maintain an appropriate balance between
the Executive and Non-Executive Directors.
The Nomination Committee Chair is William
Macpherson. The Committee has full responsibility
for reviewing the Board structure and for interviewing
and nominating candidates to serve on the Board
as well as reviewing senior executive development.
Suitable candidates, once nominated, meet with the
Chair and the Chief Executive Officer. The candidates
are then put forward for consideration and
appointment by the Board as a whole. The Committee
has access to external professional advice at the
Company’s expense as and when required.
The main roles and responsibilities of the Nomination
Committee are set out in written terms of reference
which are available on the Company’s website,
www.wilmingtonplc.com/investors/corporate-
governance/roles-board. Details of the Nomination
Committee’s activities can be found in the Nomination
Committee report on pages 79 to 80.
Audit Committee
The Audit Committee is composed of all the
Non‑Executive Directors excluding the Company
Chair. The Audit Committee Chair is Paul Dollman.
The Board considers that Paul has the necessary
recent and relevant experience to fulfil the role.
The main roles and responsibilities of the Audit
Committee are set out in written terms of reference
which are available on the Company’s website,
www.wilmingtonplc.com/investors/corporate-
governance/roles-board. Details of the Audit
Committee’s policies and activities can be found in
the Audit Committee report on pages 76 to 78.
Remuneration Committee
The Remuneration Committee is chaired by Helen
Sachdev and consists of all the Non-Executive
Directors including the Chair. It is responsible for
recommending to the Board the framework and policy
for Executive Directors’ remuneration and for setting
the remuneration of the Chair, Executive Directors
and senior management. Given the small size of
the Board, the Committee recognises the potential
for conflicts of interest, and has taken appropriate
measures to minimise the risk. The Committee meets
at least twice a year, and takes advice from the Chief
Executive Officer and external advisors as appropriate.
In carrying out its work, the Board itself determines
the remuneration of the Non-Executive Directors. The
Committee has the power to seek external advice,
and to appoint consultants as and when required in
respect of the remuneration of Executive Directors.
The main roles and responsibilities of the Remuneration
Committee are set out in written terms of reference
which are available on the Company’s website,
www.wilmingtonplc.com/investors/corporate-
governance/roles-board. Further details of the
Group’s policies on remuneration and service
contracts can be found in the Directors’ remuneration
report on pages 81 to 103.
Risk management and internal
controls
The Board maintains an ongoing process for
identifying, evaluating and managing significant risks
faced by the Group. In line with the recommendations
of TCFD, Board level oversight of climate-related risks
and opportunities sits with the Senior Independent
Director and the Chief Financial Officer. Further
details on the key features of the risk management
and internal controls can be found in the section
on risks and uncertainties facing the business on
pages 47 to 55.
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Relations with shareholders
Dialogue with institutional shareholders
The Directors seek to build on a mutual
understanding of objectives between the Company
and its institutional shareholders by means of a
programme of meetings with major shareholders,
fund managers and analysts each year. The Company
also makes presentations to analysts and fund
managers following publication of its half year and
full year results. Copies of the presentations are
available on the Company’s website,
www.wilmingtonplc.com/investors/reports-and-
presentations. The Board regularly receives updates
on investor relations matters.
The Chair is available on request to attend meetings
with major shareholders. Since his appointment on
1 May 2018, the Chair attended a number of such
meetings. As referred to earlier, the SID is available
to shareholders if they have concerns which other
contacts have failed to resolve.
The Group’s website includes a specific and
comprehensive investor relations section containing
all RNS announcements, share price information,
annual documents available for download and
similar materials.
Constructive use of the
Annual General Meeting
The Annual General Meeting will be held on
28 November 2024 and a separate notice convening
the meeting is being sent out with this Annual Report
and financial statements. Details of resolutions to be
proposed and an explanation of the items of special
business can be found in the circular that accompanies
the notice convening the meeting. Separate votes are
held for each proposed resolution.
All Directors attend the Annual General Meeting,
at which they have the opportunity to meet with
shareholders. After the formal business has been
concluded, the Chair welcomes questions from
shareholders.
Substantial shareholdings
As at 9 September 2024, the Company is aware
of the following interests amounting to 3.0% or more
in the Company’s issued ordinary share capital:
Number of
ordinary
shares
%
Aberforth Partners
20,529,089
22.92%
Schroder Investment Management
5,155,070
5.76%
Fidelity Management & Research
4,804,400
5.36%
BlackRock
4,458,523
4.98%
NFU Mutual
3,891,591
4.34%
Individuals
3,741,563
4.18%
Herald Investment Management
3,114,632
3.48%
Premier Miton Investors
2,778,473
3.10%
BGF
2,729,000
3.05%
Artemis Investment Management
2,714,554
3.03%
Board leadership and Company purpose
The Board is responsible for setting and delivering the
Group’s strategy and monitoring how it is performing
against the agreed strategy for the benefit of all
its stakeholders. The Board is also responsible for
defining, monitoring and overseeing the Group’s
culture and ensuring it is aligned to the purpose
and strategy.
Division of responsibilities
The Board has clear written guidelines on the
division of responsibilities between the Chairman,
Chief Executive Officer, Board and Committees.
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Relations with shareholders continued
Composition, succession and evaluation
The Board has delegated responsibility to the
Nomination Committee to keep under regular review
the composition of the Board and its Committees.
The Nomination Committee is also responsible
for succession planning and the Group’s policy
on diversity and inclusion.
Audit, risk and internal control
The Board has delegated responsibility to the
Audit Committee to oversee the Group’s financial
framework, financial controls and internal controls,
and that policies and procedures are in place
to manage risks appropriately.
Remuneration
The Remuneration Committee is responsible on
behalf of the Board for determining and monitoring
the strategy and policy on remuneration, termination,
performance-related pay, pension arrangements,
share incentive plans to support the Group’s strategy,
and remuneration reporting and disclosure.
By order of the Board and signed on its behalf by:
Martin Morgan
Chair
08 October 2024
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procedures, as well as ensuring that risks are
carefully identified and assessed and that sound
systems of risk management and internal control
are implemented.
Committee membership
and meetings
The Audit Committee (the ‘Committee’) was in place
throughout the financial year and is chaired by
Paul Dollman. The Board considers that Paul has
the appropriate financial expertise, as required by
Principle C3.1 of the UK Corporate Governance Code
(the ‘UK Code’), as he is a Chartered Accountant,
has held executive roles in financial positions in
other companies, including being Group Finance
Director of a FTSE 250 company, and chairs another
company’s audit committee.
Paul Dollman Senior Independent Director and Chair
of the Audit Committee will stand down from the
Board on 08 October 2024 after completion of his
full nine-year term as Independent Non-Executive
Director. The Board was pleased to welcome Sophie
Tomkins as a Non-Executive Director with effect from
23 April 2024. Sophie is a Chartered Accountant
bringing a wealth of experience and relevant
expertise, both from the financial markets and as a
Non-Executive Director. Further detail on the skills
and experience that Sophie brings to the Board can
be found per her biographical details on page 66.
On 08 October 2024, Sophie Tomkins will replace
Paul Dollman as Chair of the Audit Committee.
The Committee meets at least twice during the year
and as and when required. Representatives of the
external auditor attend each meeting along with the
Chief Executive Officer, the Chief Financial Officer and
the Deputy Chief Financial Officer, unless there is a
conflict of interest. Other relevant people from the
business are also invited to attend certain meetings
or parts of meetings to provide a deeper level of
insight into certain key issues and developments.
Once a year, the Committee meets separately with the
external auditor and with management without the
other being present.
Key activities
The key activities of the Audit Committee are
as follows:
Financial reporting
•
Monitoring the integrity of the annual and interim
financial statements, the accompanying reports
to shareholders and corporate governance
statements including any significant financial
reporting judgments contained in them.
•
Reporting to the Board the Company’s
assessment of any new or amended
accounting standards.
•
Providing advice to the Board on whether
the Annual Report and financial statements,
when taken as a whole, is fair, balanced and
understandable and provides all the necessary
information for shareholders to assess the
Company’s performance, business model
and strategy.
The Committee held three meetings in the year ended
30 June 2024 and members’ attendance at meetings
is set out below:
Committee
meetings
attended
Committee
meetings
eligible
to attend
Paul Dollman (Chair)
3
3
Helen Sachdev
3
3
William Macpherson
3
3
Sophie Tomkins
1
1
Dear Shareholder
I am pleased to present this year’s Audit Committee
report. The Committee supports the Board in
fulfilling its responsibilities in respect of monitoring
the integrity of the Group’s reporting process and
adherence to the Group’s accounting policies and
Supporting integrity
and compliance
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Key activities continued
Risk management and internal controls
•
In conjunction with the Board reviewing and
monitoring the effectiveness of the Group’s
internal control and risk management systems,
including reviewing the process for identifying,
assessing and reporting all key risks. See the
risks and uncertainties facing the business
on pages 47 to 55.
•
To oversee the Group’s whistleblowing provisions,
Modern Slavery and ABC policies to ensure that
they are operating effectively.
External audit
•
To make recommendations to the Board in relation
to the appointment and removal of the external
auditor and to approve their remuneration and
terms of engagement.
•
To review and monitor the external auditor
independence and objectivity and the
effectiveness of the audit process, taking into
consideration relevant UK professional and
regulatory requirements.
•
To develop and implement policy on the
engagement of the external auditor to supply
non‑audit services, taking into account relevant
ethical guidance regarding the provision
of non-audit services by the external audit
firm, and to report to the Board, identifying any
matters in respect of which it considers that
action or improvement is needed and making
recommendations as to the steps to be taken.
Internal audit
•
To annually assess the internal audit requirements
of the Company.
•
To monitor and review the effectiveness of the
Internal Audit function.
Activities of the Committee
in relation to the year ended
30 June 2024
•
Assessed and reported to the Board on whether
the Annual Report and financial statements are
fair, balanced and understandable.
•
Reviewed and discussed with the external auditor
the key accounting considerations and judgments
reflected in the Group’s results for the six-month
period ended 31 December 2023.
•
Reviewed and agreed the external auditors audit
plan in advance of their audit for the year ended
30 June 2024.
•
Discussed the report received from the external
auditor regarding their audit in respect of the year
ended 30 June 2024 which included comments on
their findings on internal control and a statement
on their independence and objectivity.
•
Considered key accounting matters and new
accounting standards and amendments, including
TCFD disclosures, with particular focus on the
significant areas as discusssed in the next section.
•
Reviewed the Group’s whistleblowing policy,
ensuring that it met FCA rules and good standards
of corporate governance.
•
Reviewed internal audit reports.
•
Reviewed, together with the Board, the
risk assessment and going concern and
viability review.
Key discussions in the year
The significant areas considered by the Committee
and discussed with the external auditor during the
year were:
Key financial and IT controls
The Committee reviewed the adequacy and
appropriateness of the Group’s system of controls and
its effectiveness with relevant input from the Group’s
external auditor. The Committee has continued to
monitor the Group’s emerging risks in relation to
technology and the suitability of its technology
controls in response to this.
Goodwill and intangible asset impairment
The Committee received reports from management
on the carrying value of goodwill and intangible
assets. The Committee reviewed management’s
recommendations, which were also considered
by the external auditor, including evaluation of
the appropriateness of the assumptions applied
in determining asset carrying values and the
appropriateness of the identification of cash
generating units. After review, the Committee
was satisfied with the assumptions and judgments
applied by management and concluded that the
carrying values were appropriate, the impairment
was correctly recognised, and no other impairments
were required.
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Key discussions in the year continued
Acquisitions & disposals
The Committee received reports from management
regarding the accounting for acquisitions &
disposals made during the year. The Committee
reviewed management’s recommendations, which
were also considered by the external auditor,
including evaluation of the appropriateness of
the assumptions applied in determining discount
rates and the treatment of deferred consideration.
After review, the Committee was satisfied with the
assumptions and judgments applied by management
and concluded that the accounting was appropriate.
Revenue recognition
The Committee considered the inherent risk of
fraud in revenue recognition as defined by auditing
standards and was satisfied that there were no
issues arising.
External audit
This year Grant Thornton UK LLP completed
their sixth year as the Group’s external auditor.
The Audit Committee is responsible for reviewing the
independence and objectivity of the external auditor
and ensuring this is safeguarded notwithstanding any
provision of any other services to the Group.
The Committee recognises the importance of
safeguarding auditor objectivity and has taken the
following steps to ensure that auditor independence
is not compromised.
External auditor effectiveness
The Audit Committee carries out each year a full
evaluation of the external auditor as to its complete
independence from the Group and relevant officers
of the Group in all material respects and that it is
adequately resourced and technically capable to
deliver an objective audit to shareholders. Based on
this review the Audit Committee recommends to the
Board each year the continuation, or removal and
replacement, of the external auditor.
The external auditor’s, Grant Thornton UK LLP, report
to the Directors and the Audit Committee confirming
their independence in accordance with Auditing
Standards. In addition to the steps taken by the Board
to safeguard auditor objectivity, the Audit Practices
Board Ethical Standard 3 requires audit partner
rotation every five years for listed companies.
Under the Ethical Standards, the Audit Committee
requested a one-year extension to the engagement
partner’s rotation to safeguard the quality of the audit
engagement, due to the substantial changes which
have occurred in the financial year ended 30 June
2024. These substantial changes include the disposal
of its European Healthcare business and the material
acquisition of Astutis.
Non-audit services
The Committee considers that certain non-audit
services should be provided by the external auditor,
because its existing knowledge of the business makes
this the most efficient and effective way for non-audit
services to be carried out. The Audit Committee gives
careful consideration before appointing the auditor to
provide other services. The Group regularly uses other
providers to ensure that independence and full value
for money are achieved. Other services are generally
limited to work that is closely related to the annual
audit or where the work is of such a nature that a
detailed understanding of the business is necessary.
In the year the external auditor performed non-audit
services totalling £17.5k which represents 4% of the
audit fee of £450k. These services were in relation to
the interim review. The Audit Committee approved the
appointment of Grant Thornton on the basis that it
was best placed to provide the services and there was
no conflict of interest with its role as external auditor.
Internal audit
The Group operates a limited internal audit
process which performs relevant reviews as part
of a programme approved by the Audit Committee.
The Committee considers any issues or risks arising
from internal audit in order that appropriate actions
can be undertaken for their satisfactory resolution.
Approved on behalf of the Audit Committee by:
Paul Dollman
Chair of the Audit Committee
08 October 2024
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Committee membership
and meetings
The Nomination Committee (the ‘Committee’)
is comprised of the Company Chair and four
Independent Non-Executive Directors.
Key responsibilities
The key responsibilities of the Committee are to:
•
review the size, balance and constitution of
the Board including the diversity and balance
of skills, knowledge and experience of the
Non‑Executive Directors;
•
consider succession planning for Directors and
other senior executives;
•
identify and nominate for the approval of the
Board candidates to fill Board vacancies;
•
review annually the time commitment required
of Non-Executive Directors; and
•
make recommendations for the Board, in
consultation with the respective Committee
Chair regarding membership of the Audit and
Remuneration Committees.
Main activities of the Committee during
the year and subsequent to the year end.
The key matters considered at these meetings were:
i) Board composition
The Committee reviewed the composition of the
Board including the range of skills, level of experience
and balance between Executive and Non‑Executive
Directors. The Committee also reviewed the
membership of the various Board Committees.
The Committee concluded that the current
membership of the Board and the Board Committees
was appropriate for the needs of the business.
Paul Dollman Senior Independent Director and
Chair of the Audit Committee will stand down from
the Board on 08 October 2024 after completion of his
full nine-year term as Independent Non-Executive
Director. The Committee led the search to appoint
a Non-Executive Director to the Board, considering
the optimum criteria and attributes appropriate for
this role. The Board was pleased to welcome Sophie
Tomkins as a Non-Executive Director with effect from
23 April 2024. Sophie is a Chartered Accountant
bringing a wealth of experience and relevant
expertise, both from the financial markets and as a
Non-Executive Director. Further detail on the skills
and experience that Sophie brings to the Board can
be found per her biographical details on page 66.
On 08 October 2024, Paul Dollman will be replaced
as Senior Independent Director by Helen Sachdev and
Chair of the Audit Committee by Sophie Tomkins.
ii) Board evaluation
Details of the Board and sub-committee evaluation
process undertaken in this year are included in the
Corporate Governance review on pages 67 to 75.
As part of that process the Non-Executive Directors
met without the Company Chair present to evaluate
his performance. The review of the Company
Chair’s effectiveness was led by the SID. The review
concluded that the Company Chair had been highly
effective in his role.
Dear Shareholder
I am pleased to present the Nomination Committee
report for the year ended 30 June 2024. The
Committee met once during the year to 30 June
2024 and members’ attendance at meetings is set
out below:
Committee
meetings attended
Committee meetings
eligible to attend
William Macpherson
(Chair)
1
1
Paul Dollman
1
1
Helen Sachdev
1
1
Martin Morgan
1
1
Sophie Tomkins
0
0
Maintaining a
strong Board
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Committee membership
and meetings continued
iii) Succession planning
The Committee kept under review the succession
plans for both the Executive and Non-Executive
Directors and the level of senior management
immediately below Board level.
iv) Other senior management
representation
The Committee maintained oversight over various
senior management changes that occurred across the
Group over the year. Regular updates were received
from the executives on the progress of the searches
and the plans for dealing with reporting line changes
that resulted from certain of the departures.
v) Worker representation
William Macpherson is the Director responsible for
worker representation.
Approved on behalf of the Nomination Committee by:
William Macpherson
Chair of the Nomination Committee
08 October 2024
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2024 remuneration in the context
of our business performance and
outcomes for our key stakeholders
Our aim is to always consider the wider workforce,
our shareholders and other stakeholders by taking a
fair, prudent and balanced approach to remuneration,
in line with the Board’s wider stakeholder engagement
strategy as disclosed in the Section 172 statement on
pages 21 to 24.
As detailed in our Strategic report, we continue to
deliver our strategy and our progress is reflected by
the strong results we have reported. The resilience
of the business in response to challenging times
demonstrates the Group’s ability to adapt to change
and continue to deliver exceptional customer
service under the guidance of the strong executive
team. The Group’s success also reflects the ongoing
motivation of our employees who continue to deliver
to the highest standards in all areas of activity.
Wider workforce
Our overall remuneration philosophy throughout the
Group is that base salaries should be set to be market
competitive but having regard to total compensation
and reflecting the size and complexity of the business
and the calibre and experience of individuals in each
role. Pay progression to bring our people closer to
or at the median has been one area of focus for the
last two pay cycles, and where base salaries have
fallen behind the market higher increases, ahead of
the standard increase, have been awarded taking into
account market data, and the skillset and experience
of employees. This overall philosophy informs how
we set remuneration for the Executive Directors.
We continue to engage regularly with our workforce
on the issues that matter to them, particularly
diversity, wellbeing and development as well as
reward and recognition. Our employee engagement
survey and performance review process offer the
opportunity to understand how employees feel about
their own reward.
The Board continued its programme of work to
meaningfully engage with our workforce. As part
of this exercise, Helen Sachdev attended a workshop
led by Wilmington plc CPO on the topic of Reward.
The purpose of the session was to engage with
the workforce on the Wilmington plc wide Reward
strategy and in particular the alignment of executive
remuneration and that of the wider workforce.
Key to this are the strategic pillars of; paying fairly
against market, paying for performance, having clarity
around the reasons for pay decisions and equipping
the business to apply these principles to reward
decisions. The session was attended by 12 employees
chosen at random with representation from a range
Dear Shareholder
On behalf of the Committee I am pleased to share
our Directors’ Remuneration report for the year to
30 June 2024.
Our current Directors’ Remuneration Policy was
approved by shareholders at the 2021 AGM. In line
with the usual timetable, a new Policy is to be put
to shareholders for approval, by way of a binding
vote, at the 2024 AGM. During the course of the
financial year to 30 June 2024 we reviewed the
Policy approved in 2021 to ensure that it continues
to support delivery of the business’ strategy.
The new Policy is set out on pages 82 to 94 and I
have summarised our approach to its finalisation
and the differences between the new Policy and the
Policy approved in 2021.
Our Directors’ Remuneration report, other than the new
Policy, is subject to an advisory shareholder vote at the
2024 AGM and explains the work of the Committee,
how we have implemented for the year to 30 June 2024
the Policy approved in 2021 and how we intend to
implement the new Policy for the 2025 financial year.
Remuneration
Committee Chair’s
Annual Statement
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Wider workforce continued
of employee bands, a range of our global locations
and a range of our Business Units. The session was
informative and reinforced that the principles of
executive remuneration are consistent with those
of the wider workforce.
Annual bonus and PSP awards
vesting in respect of the
performance period to 30 June 2024
The Committee has reviewed performance against
each of the previously approved measures to
determine the bonus outturn and PSP vesting in
respect of the period ended 30 June 2024. Based on
strong delivery against performance measures in the
year, the Committee approved a bonus outturn equal
to 117% of salary for the Executive Directors.
The Committee also reviewed the outturn of the
performance metrics applied to the PSP awards
granted to Mark Milner and Guy Millward in
September 2021. The performance over the
three‑year period to 30 June 2024 was considered
and the Committee approved an outturn of 100%
in respect of these awards.
The Committee reviewed the formulaic outturn of
both the bonus and the PSP awards, and after careful
consideration concluded that these outturns were
appropriate and reflected the performance of the
Group in the periods to which they relate. Details of
the performance measures and achievements against
them in respect of the bonus and PSP awards are set
out on pages 97 to 99 respectively.
Our approach to the new Policy
During FY24, the Committee reviewed in detail the Policy approved at the 2021 AGM in the context of the
need to retain and recognise the experience and strong performance of our Executive Directors, the growth
in the size of the business since the last Policy review, the need to ensure that the Policy appropriate rewards
and incentivises the Executive Directors to drive and deliver the Group’s strategy and alignment with our
overall remuneration philosophy throughout the Group. The Committee consider that the Policy approved in
2021 remains largely fit-for-purpose, and as a result only a small number of minor amendments are proposed.
The key changes are set out below.
Element
2021 Policy
New Policy
Bonus deferral
Under the 2021 Policy,
where the bonus
opportunity exceeds
100% of salary, up to 20%
of any bonus earned is
deferred into shares for up
to two years.
As a proportionate response to help provide Wilmington with a
competitive edge to attracting and retaining executive talent whilst still
having a meaningful emphasis on shareholder alignment across the
arrangements as a whole, deferral of 20% of any bonus earned will apply
until the Executive Director meets the in‑service shareholding guideline
(200% of salary, which is retained under the new Policy).
PSP
opportunity
Under the 2021 Policy, the
maximum PSP opportunity
is 150% of salary.
Under the new Policy, headroom is added to permit the grant of PSP
awards at the level of up to 175% of salary. This additional headroom is
included to ensure that the new Policy has appropriate flexibility for the
future given Wilmington’s growth ambitions and with any use of it in the
future subject to progress on the delivery of results to shareholders.
For FY25, awards for the CEO and CFO will be at the level of 125%
of salary.
To reflect the increase in the maximum PSP in the Policy, at the 2024
AGM shareholders will also be asked to approve an amendment to the
rules of the PSP.
PSP Awards
– ROCE
underpin
The 2021 Policy included a
specific ROCE underpin for
the FY22 awards, requiring
average ROCE over the
performance period of 10%.
A similar underpin was
applied to the FY23 and
FY24 PSP awards.
PSP awards will continue to be subject to a specific ROCE underpin.
However, for the awards to be granted in respect of FY25 this will be
increased to 13%; it is anticipated that the same level of underpin will
apply to the PSP awards granted for the remainder of the new Policy’s
three-year life.
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Our approach to the new Policy
continued
Other minor changes have also been made to take
account of the practical operation of the new Policy
and changes in practice since the current Policy was
approved in 2021.
Shareholders consulted were supportive of our
approach in relation to both the new Policy and
its proposed implementation in FY25 and we took
into account feedback received when finalising our
proposals, notably in relation to the increase in the
level of the ROCE underpin.
Reflecting that the Committee considered the Policy
approved in 2021 largely fit-for-purpose, other
aspects of it will continue as approved in 2021.
Information in relation to how the new Policy is
to be applied in FY25 is set out below.
Implementation of our Policy
for the year ending 30 June 2025
(following shareholder approval
at 2025 AGM)
As part of our Policy review, we reviewed all elements
of the Executive Directors’ remuneration packages
and overall total compensation. This review showed
that Mark Milner’s salary and total compensation
are now positioned at the lower end of the market.
For Guy Millward, the review showed that his salary
is positioned at a broadly market competitive level
but that his long-term incentive opportunity of
100% of salary is positioned below the lower end
of the market, with his overall remuneration package
positioned between the lower end and mid-point of
the market. This review has informed our approach
to the implementation of the new Policy in FY25.
Base salary and fees
As outlined above, our review of the Executive
Directors’ remuneration packages showed that Mark
Milner’s salary is now positioned at the lower end
of the market. This is not aligned with our overall
remuneration philosophy throughout the Group.
Therefore, for FY25 Mark Milner’s salary has been
increased by 15% to £480,000 with effect from 1 July
2024. The Committee was strongly of the opinion that
this increase is appropriate in the context of Mark’s
individual performance, the increase in the size of the
business and our overall approach to remuneration
for the wider workforce.
The Committee also recognised Guy Millward’s strong
performance and awarded a salary increase of 5%
to £308,700 with effect from 1 July 2024 in line
with the average increase for the wider workforce
in the UK and taking into account the market
positioning of his salary.
Pension and Benefits
Both executive directors will receive
pension / cash in lieu of pension aligned
with the wider workforce in the UK
at 5% of salary for the year ending
30 June 2025 (‘FY25’). There are
no changes to benefits for FY25.
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Implementation of our Policy for the
year ending 30 June 2025 (following
shareholder approval at 2025 AGM)
continued
Annual bonus
The maximum bonus opportunity under the new
Policy has not increased. Therefore, each of the
Executive Directors is eligible to earn a bonus of up
to 125% of salary. Vesting is based on adjusted PBT
(42.5% of the opportunity), organic revenue growth
(42.5% of the opportunity) and key strategic measures
(15% of the opportunity). Details of the performance
measures and achievements against them will be set
out in next year’s Directors’ Remuneration report. As
described above, deferral of bonus earned into shares
will be in line with the updated Policy set out below.
PSP
As described above, the maximum PSP opportunity
under the new Policy is 175% of salary, compared
to 150% of salary under the Policy approved in 2021,
with this additional headroom included to ensure
that the new Policy has appropriate flexibility for
the future.
As part of our review, of the Executive Directors’
remuneration packages, we considered whether to
utilise the existing headroom (up to 150% of salary)
under the Policy approved in 2021.
•
Recognising investor preference not to make
substantive increases to more than one element
of remuneration in the same year, we have
decided not to use that existing headroom for
Mark Milner in FY25, with his award remaining
at 125% of salary. However, taking into account
feedback received from some shareholders
highlighting the importance of ensuring that our
Executive Directors are appropriately incentivised
with a competitive package aligned with the
delivery of long term sustainable value for
shareholders, our firm intention is to utilise that
existing headroom for Mark Milner and increase
his PSP award to 150% of salary with effect
from FY26.
•
As outlined above, the review of the Executive
Directors’ remuneration packages showed that
Guy Millward’s long-term incentive opportunity
was positioned below the lower end of the
market. Therefore, for FY25 his PSP award is to be
increased from 100% of salary to 125% of salary.
Vesting will be subject to performance measures
based on adjusted EPS and organic revenue growth
with targets being finalised in the next few weeks.
Vesting will also be subject to an underpin such that
average ROCE over the performance period must be
at least 13%, and any awards that vest will be subject
to a two-year post-vesting holding period in line with
the Policy.
Chair fees and Non-Executive fees
Chair fees and Non-Executive fees have been
increased with effect from 1 July 2024 by 5% in line
with general workforce increases. The Chair’s base
fee was increased from £147,000 to £154,350 and
the NED base fee to £56,724. No additional fee is
paid for chairing board committees, but an additional
£3,000 is payable to reflect the additional time and
responsibilities associated with holding the position of
SID, from 08 October 2024 this position will be taken
up by Helen Sachdev. For further information, see the
Nomination Committee report on page 79.
Attendance
The Committee held three meetings in the year ended
30 June 2024 and members’ attendance at meetings
is set out below:
Committee
meetings
attended
Committee
meetings
eligible to
attend
Helen Sachdev (Chair)
3
3
Martin Morgan
3
3
Paul Dollman
3
3
William Macpherson
3
3
Sophie Tomkins
0
0
Conclusion
We remain committed to a responsible approach
to executive remuneration, as I trust this Directors’
Remuneration report demonstrates. We believe that
the Policy operated as intended in respect of the year
to 30 June 2024 and consider that the remuneration
received by the Executive Directors was appropriate,
taking account of the Group’s performance during the
year, their personal performance and the experience
of shareholders and employees.
I look forward to receiving your support at our 2024
Annual General Meeting, where I will be pleased to
answer any questions you may have on this report or
in relation to any of the Committee’s activities.
Helen Sachdev
Chair of the Remuneration Committee
08 October 2024
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Directors’ remuneration policy
As described in the statement from the
Committee’s Chair above during the course of
FY24 we undertook a comprehensive review of
all aspects of the Directors’ Remuneration Policy
that was approved at the 2021 Annual General
Meeting.
This part of the Directors’ remuneration report
sets out the Company’s Directors’ Remuneration
Policy determined following that review and
a consultation with the Company’s largest
shareholders. Subject to shareholder approval
at the 2024 Annual General Meeting, the
Policy shall take binding effect from the close
of that meeting. The Policy was determined
independently by the Committee, taking into
account comments received from shareholders.
The differences between this Policy and the
Directors’ Remuneration Policy approved at
the Company’s 2021 Annual General Meeting
are summarised in the statement from the
Committee’s Chair above.
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Element
Base salary
Purpose and
link to strategy
Core element of fixed remuneration set at a market competitive level to reflect the individual’s role, experience and performance.
Operation
The Committee ordinarily reviews base salaries annually taking into account:
• performance of the Group and pay conditions elsewhere in the workforce;
• performance of the individual;
• changes in position or responsibility; and
• market competitiveness
The Committee periodically takes external advice to benchmark salaries by reference to Executives with similar positions in comparator organisations. In considering relevant benchmarking the
Committee is also aware of the risk of an upward pay ratchet through placing undue emphasis on comparator pay surveys.
Opportunity
Whilst there is no maximum salary, increases will normally be in line with the typical level of salary increase awarded
(in percentage of salary terms) to other employees in the Group.
Salary increases above this level may be awarded in appropriate circumstances, such as:
• where an Executive Director has been promoted or has had a change in scope or responsibility;
• a new Executive Director being moved to market positioning over time;
• where there has been a significant change in market practice; and
• where there has been a significant change in the size and/or complexity of the business.
Such increases may be implemented over such time period as the Committee deems appropriate.
Performance
metric
Although base salary is not subject to any formal performance condition, the individual’s performance in role and overall Group performance is taken into account in determining any salary increase.
Pension
Purpose and
link to strategy
Rewards sustained contribution and commitment to the Group.
Provides an appropriate means of saving to deliver post-retirement income.
Operation
Executive Directors are eligible to participate in the defined contribution pension scheme.
The Committee has the discretion to pay cash supplements in lieu of some or all pension contributions in appropriate circumstances.
Executive Directors are entitled to elect to sacrifice part of their salary and bonus into a personal pension scheme.
Opportunity
An employer contribution and/or cash supplement at a level not exceeding the level available to the majority of the wider workforce in the Executive Director’s local market (currently 5% of salary).
Performance
metric
Not applicable.
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Element
Benefits
Purpose and
link to strategy
Set at a market competitive level with the aim to recruit, motivate and retain Directors of the calibre required.
Operation
Executive Directors receive benefits in line with market practice. These include a fully expensed car or car allowance and private medical cover (for the Executive Director and his or her family),
death in service cover, and permanent health insurance.
Executive Directors are eligible to participate in the Company’s Save As You Earn (‘SAYE’) plan on the same terms as other qualifying employees.
Other benefits may be provided based on individual circumstances and/or response to market pressures.
Opportunity
Whilst the Committee has not set an absolute maximum on the level of benefits Executive Directors may receive, the value of the benefit is set at a level which the Committee considers
to be appropriately positioned taking into account relevant market levels based on the nature and location of the role and individual circumstances.
The limit on participation in the SAYE plan and the discount applied in setting the exercise price will be in accordance with the applicable tax legislation and will be the same for all
participating employees.
Performance
metric
Not applicable.
Bonus including Deferred Bonus Plan (‘DBP’)
Purpose and
link to strategy
Rewards the achievement of targets, which may include financial, operational and strategic targets, aligned with the Group strategy.
Operation
Targets are reviewed annually and any pay-out is determined by the Committee after the year end based on targets set for the relevant performance period.
Targets will ordinarily be assessed over a full financial year. However, the Committee retains discretion to set targets which are assessed over part of a financial year in exceptional
circumstances. If a target is assessed over part of a year only, no bonus will be paid until after the end of the full financial year and the amount of any bonus payable in respect of part year
performance will be subject to the Committee’s assessment of holistic performance across the full financial year.
The Committee has discretion to amend the bonus out-turn if any formulaic output does not reflect its assessment of overall business or individual performance, is inappropriate in the context
of unforeseen or unexpected circumstances, or for other reasons considered relevant by the Committee. As part of this assessment, the Committee will also take into account ROCE and quality
of earnings.
The application of bonus deferral will depend upon achievement against the Company’s in-service shareholding guidelines.
• If an Executive Director has not met the Company’s in-service shareholding guidelines (as determined by the Committee), up to 20% of any bonus earned will be deferred into shares for
a period of two years. The Committee retains discretion not to apply deferral where the amount otherwise deferred would be less than £5,000.
• If an Executive Director has met the Company’s in-service shareholding guidelines (as determined by the Committee), the whole of any bonus earned will be paid in cash.
Deferred bonus awards may take the form of nil-cost options, conditional awards of shares or such other form as has a similar economic effect. Additional shares may be delivered in respect of
shares which vest under the DBP to reflect the value of dividends which would have been paid on those shares up to the date of vesting. The Committee shall determine the basis on which the
value of such dividends shall be calculated, and may assume the reinvestment of dividends in the Company’s shares on a cumulative basis.
Any bonus opportunity may be reduced or cancelled before payment (i.e. a malus provision) or recovered (i.e. a clawback provision) in the period of two years after payment. The malus and
clawback provisions may be applied in the event of a material misstatement of results, serious reputational damage to the Group, gross misconduct on the part of the Executive Director,
error in assessing the award or vesting outcome, or corporate failure.
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Element
Bonus including Deferred Bonus Plan (‘DBP’)
Opportunity
The maximum bonus is 125% of base salary.
Performance
metric
Stretching targets are set each year reflecting the business priorities which underpin Group strategy and align to key performance indicators.
The majority of the bonus opportunity will be determined by financial measures. The balance (if any) of the bonus opportunity will be determined by non-financial measures, based on strategic
and/or operational KPIs.
Vesting of the opportunity based on financial metrics will apply on a sliding scale up to 100% of maximum potential for this element of the bonus based on the satisfaction of performance
conditions, with no more than 50% of the potential earned for achieving a target level of performance.
Vesting of any opportunity based on non-financial metrics (where applicable) will apply on a scale between 0% and 100% based on the Committee’s assessment of the extent to which
non‑financial performance metrics has been met.
The level of vesting in respect of any metric is subject to the Committee’s discretion to override formulaic out-turns
Performance Share Plan (‘PSP’)
Purpose and
link to strategy
Incentivises Executive Directors to achieve returns for shareholders over a longer timeframe.
Operation
Executive Directors may receive awards in the form of conditional awards of shares or options to acquire shares for nil or nominal cost.
Vesting is dependent on the achievement of performance conditions normally over a period of three financial years.
The Committee has discretion to amend the vesting out-turn if any formulaic output does not reflect its assessment of overall business or individual performance, is inappropriate in the context
of unforeseen or unexpected circumstances, or for other reasons considered relevant by the Committee. As part of this assessment, the Committee will also take into account ROCE and quality
of earnings. For the FY24 PSP awards, a specific ROCE underpin will apply such that awards will not vest unless average ROCE over the performance period is at least 13%. It is anticipated
that a similar underpin will apply to future PSP awards.
Other than shares sold to cover tax liabilities arising in respect of the acquisition of shares pursuant to an award and any exercise price, all shares must be retained for at least a holding period
of two years from the end of the performance period.
An award may be reduced or cancelled before vesting (i.e. a malus provision) or recovered (i.e. a clawback provision) up to the later of (i) the second anniversary of vesting and (ii) the
publication of the Company’s second set of audited financial accounts following vesting. The malus and clawback provisions may be applied in the event of a material misstatement of results,
serious reputational damage to the Group, gross misconduct on the part of the Executive Director, error in assessing the grant or vesting outcome, or corporate failure. Clawback may be
effected by a proportionate reduction of future bonuses and/or share awards made under the PSP to reflect the overpayment of shares, or the participant may be required to repay the overpaid
amounts from personal funds.
Additional shares may be delivered in respect of shares which vest under the PSP to reflect the value of dividends which would have been paid on those shares up to the date of
vesting. The Committee shall determine the basis on which the value of such dividends shall be calculated, and may assume the reinvestment of dividends in the Company’s shares
on a cumulative basis.
Opportunity
The maximum award limit under the PSP is 175% of base salary. Awards in respect of FY25 will be at a level not exceeding 125% of base salary.
Performance
metric
Awards under the PSP will be based on financial metrics with respect to at least 80% of the award. Any balance of an award (up to 20%) will be based on one or more strategic or operational
metrics. The metrics chosen will be those which the Committee considers to be the most appropriate measures of longer term performance.
The threshold pay-out level under the PSP is 25% of the maximum award.
There will usually be straight line vesting between threshold and maximum performance.
The level of vesting in respect of any metric is subject to the Committee’s discretion to override formulaic out-turns.
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Operation of share plans
The Committee may amend the terms of awards
under the PSP, DBP or SAYE in accordance with and
to the extent permitted by the relevant plan’s rules
in the event of a variation of the Company’s share
capital, demerger, special dividend or other relevant
event. The Committee may operate the PSP, DBP and
SAYE (including that it may amend the rules of the
plans and awards granted under them) in accordance
with their rules.
Awards under the PSP and DBP may be granted
as cash-settled equivalents or settled, in whole
or in part, in cash at the Committee’s discretion
(although the Committee would only grant or
settle in cash in the case of an Executive Director
in exceptional circumstances, such as where there
is a regulatory restriction on the delivery of shares,
or where the circumstances mean that cash
settlement is appropriate as regards the tax liability
due in respect of the award).
Explanation of performance metrics chosen
Performance measures for the bonus and PSP
are reviewed annually to ensure they continue
to reflect the business strategy and remain
sufficiently stretching.
Annual bonus
The performance metrics for the FY25 bonus are
described on pages 87 to 88. The Committee
considers that a profit measure and an organic
revenue measure are closely aligned to the Group’s
key performance metrics. Basing part of the annual
bonus opportunity on strategic KPIs enables the
Committee to incentivise and reward inputs and
outputs aligned to the future implementation of the
Group’s strategy.
PSP
As discussed on page 88, the performance metrics
for the FY25 PSP awards will be based on EPS and
organic revenue growth. The EPS target will reward
significant and sustained increase in earnings that
would be expected to flow through into shareholder
value; for the participants, this will also deliver a
strong ‘line of sight’ as it will be straightforward
to evaluate and communicate. The use of a revenue
growth measure reflects our focus on sustainable
growth by investing in our business and actively
managing a streamlined portfolio.
When setting the performance targets, the Committee
will take into account a number of different reference
points, which may include the Company’s business
plans and strategy and market environment.
Full vesting will only occur for what the Committee
considers to be stretching performance.
The Committee may vary any performance measure
(including any underpin) if an event occurs which
causes it to determine that it would be appropriate
to vary the measure or to take account of any other
exceptional circumstances, provided that any such
variation is fair and reasonable. If a variation is made
as a result of the occurrence of an event, it may
be made only if (in the opinion of the Committee)
the altered performance measure would be not
materially less difficult to satisfy than the unaltered
performance measure would have been but for the
event in question. If the Committee were to make such
a variation, a full explanation would be given in the
next Directors’ remuneration report.
Shareholding guidelines
To align the interests of Executive Directors with those
of shareholders, we have adopted formal shareholding
guidelines, as summarised below. The Committee
retains discretion to vary the application of the
guidelines in exceptional circumstances.
In-service
Executive Directors are required to hold shares
acquired pursuant to PSP awards for the holding
period referred to in the ‘Operation’ row of the
PSP section on page 88.
Executive Directors must retain 50% of the after-
tax shares they acquire on the vesting of PSP and
DBP awards until such time as a total personal
shareholding equal to 200% of base salary has been
achieved. Shares which are subject to the two-year
holding period under the PSP or which are subject
to a DBP award will count towards the requirement,
on a net of assumed tax basis where relevant.
Post-employment
The Committee has adopted a post-employment
shareholding requirement. Shares are subject to this
requirement only if they are acquired from PSP and
DBP awards granted after 1 July 2021. Following
employment, an Executive Director must retain:
•
For the first year after employment, such of their
shares which are subject to the post-employment
requirement as have a value for these purposes
equal to 100% of salary; and
•
for the second year after employment, such of
those shares as have a value for these purposes
equal to 50% of salary,
or in either case and if fewer, all of those shares.
If relevant and the Committee so determines, the
period for which the post-employment requirement
applies may start from the date on which the
Executive Director steps down from the Board.
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Mark Milner
Guy Millward
£533k
£1,033k
£1,733k
£2,033k
Minimum
performance
Performance
in line with
expectations
Maximum
performance
Maximum
performance
plus share price
appreciation
100%
52%
29%
31%
34%
27%
29%
Fixed pay
Bonus
PSP
19%
35%
44%
£354k
£676k
£1,126k
£1,319k
100%
52%
27%
31%
29%
29%
34%
Minimum
performance
Performance
in line with
expectations
Maximum
performance
Maximum
performance
plus share price
appreciation
Fixed pay
Bonus
PSP
19%
44%
35%
Illustration of the application of the Remuneration Policy
The following charts set out for each of the Executive Directors an illustration
of the application for FY25 of the Remuneration Policy set out above. The charts
show the split of remuneration between fixed pay and variable pay in the
Policy for:
•
minimum remuneration receivable — salary, fees, taxable benefits and pension;
•
the remuneration receivable if the Director was, in respect of any performance
measures or targets, performing in line with the Company’s expectation;
•
maximum remuneration receivable (not allowing for any share price
appreciation); and
•
maximum remuneration receivable assuming a 50% increase in the Company’s
share price for the purposes of the PSP element.
The Committee believes an appropriate proportion of the Executive Directors’
remuneration links reward to corporate and individual performance and is aligned
to the Group’s strategic priorities.
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Illustration of the application of the Remuneration Policy continued
In illustrating the potential reward, the following assumptions have been made:
Basic performance
In line with expectations
Maximum performance
Maximum performance plus share price appreciation
Fixed pay
Based on salary effective as at 1 July 2024 , a pension contribution of 5% of salary and benefits earned for the year ended 30 June 2024.
Bonus
No bonus.
50% of the maximum bonus is earned
(i.e. 62.5% of salary).
125% of salary.
125% of salary.
PSP
No PSP vesting.
33% of the PSP awards vest (i.e. 41.6%
of salary).
125% of salary.
125% of salary plus an assumed 50% increase in the
share price.
Differences in policy from wider employee population
The Company values its wider workforce and aims to provide a remuneration
package that is market competitive, complies with any statutory requirements
and is applied fairly and equitably across the wider employee population. Where
remuneration is not determined by statutory regulation, the Company operates the
same core principles as it does for Executive Directors namely:
•
we remunerate people in a manner that allows for stability of the business and
the opportunity for sustainable long term growth; and
•
we seek to remunerate fairly and consistently for each role with due regard to
the market place, internal consistency and the Company’s ability to pay.
Non-Executive Directors
Purpose and link to strategy
Operation
Opportunity
Performance metrics
Non-Executive Director fees and
provision of relevant benefits
Fees are set at a level that reflects
market conditions and is sufficient to
attract individuals with appropriate
knowledge and experience.
Fees are reviewed periodically and amended to
reflect any change in responsibilities and time
commitments. Where appropriate external advice
is taken on setting market competitive fees.
The Non-Executive Directors do not participate
in any of the Group’s share incentive plans nor do
they receive any benefits or pension contributions.
Non-Executive Directors may be eligible to
receive benefits such as the use of secretarial
support, travel costs or other benefits that may
be appropriate.
Fees are based on the time commitment
and responsibilities of the role.
Fees are subject to an overall cap as
set out in the Company’s articles of
association from time to time or as
otherwise approved by shareholders.
Not applicable.
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Recruitment remuneration policy
The objective of this policy is to allow the Committee
to offer remuneration packages which facilitate the
recruitment of individuals of sufficient calibre to lead
the business and effectively execute the strategy
for shareholders. When appointing a new Executive
Director, the Committee seeks to ensure that
arrangements are in the best interests of the Company
and not to pay more than is appropriate.
The Committee will take into consideration all
relevant factors including the calibre of the individual,
the candidate’s existing remuneration package, and
the specific circumstances of the individual including
the jurisdiction from which the candidate was
recruited.
When hiring a new Executive Director, the Committee
will typically align the remuneration package with
the above Policy. The Committee may include other
elements of pay which it considers are appropriate.
However, this discretion is capped and is subject to
the principles and the limits referred to below.
•
Base salary will be set at a level appropriate
to the role and the experience of the Director
being appointed. This may include agreement
on future increases up to a market rate, in line
with increased experience and/or responsibilities,
subject to good performance, where it is
considered appropriate.
•
Retirement benefits will only be provided in line
with the above Policy.
•
The Committee will not offer non-performance
related incentive payments (for example a
‘guaranteed sign-on bonus’).
•
Other elements may be included in appropriate
circumstances such as:
•
an interim appointment being made to fill an
Executive Director role on a short term basis;
•
if exceptional circumstances require that the
Chair or a Non-Executive Director takes on an
executive function on a short term basis;
•
if an Executive Director is recruited at a time
in the year when it would be inappropriate
to provide a bonus or long term incentive
award for that year as there would not be
sufficient time to assess performance. Subject
to the limit on variable remuneration set out
below, the quantum in respect of the months
employed during the year may be transferred
to the subsequent year so that reward is
provided on a fair and appropriate basis; and
•
if the Director will be required to relocate
in order to take up the position, it is the
Company’s policy to allow reasonable
relocation, travel and subsistence payments.
Any such payments will be at the discretion of
the Committee.
•
The Committee may also alter the performance
measures, performance period, vesting period
and deferral period of the bonus or PSP if the
Committee determines that the circumstances
of the recruitment merit such alteration. The
rationale will be clearly explained in the Directors’
remuneration report.
•
The maximum level of variable remuneration
which may be granted (excluding ‘buyout’ awards
as referred to below) is 300% of salary.
The Committee may make payments or awards
in respect of hiring an employee to ‘buy out’
remuneration arrangements forfeited on leaving a
previous employment or engagement. In doing so,
the Committee will take account of relevant factors
including any performance conditions attached to the
forfeited arrangements and the time over which they
would have vested. The Committee will generally
seek to structure buyout awards or payments on a
comparable basis to the remuneration arrangements
forfeited. Any such payments or awards are excluded
from the maximum level of variable remuneration
referred to above. Where considered appropriate,
such special recruitment awards will be liable to
forfeiture or ‘clawback’ on early departure.
Any share awards referred to in this section will
be granted as far as possible under the Company’s
existing share plans. If necessary and subject to the
limits referred to above, recruitment awards may be
granted outside of these plans as permitted under the
Listing Rules which allow for the grant of awards to
facilitate, in unusual circumstances, the recruitment
of an Executive Director. Where a position is filled
internally, any ongoing remuneration obligations or
outstanding variable pay elements shall be allowed
to continue in accordance with their terms.
Fees payable to a newly appointed Chair or
Non-Executive Director will be in line with the policy
in place at the time of appointment.
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Payments for loss of office
The Company has adopted the following policy on Executives’ service contracts.
Notice period
Twelve months’ notice period or less shall apply.
Termination
payments and
mitigation
Termination payments are limited to payment of twelve months’ salary, contractual pension amounts and benefits. The Committee retains discretion to continue to provide benefits during
any notice period that would otherwise have applied.
The policy is that, as is considered appropriate at the time, the departing Director may work, or be placed on garden leave, for all or part of their notice period, or receive a payment in lieu
of notice in accordance with the service agreement.
The Committee will consider mitigation to reduce the termination payment to a leaving Director when appropriate to do so, having regard to the circumstances.
Bonus
The decision whether or not to award a bonus in full or in part to an Executive Director will be dependent upon a number of factors including the circumstances of their departure and their
contribution to the business during the bonus period in question. Bonus payments will be made only to ‘good leavers’, which will include those who leave due to, retirement, ill health or
disability, death, or any other reason determined by the Committee. Any bonus payment made would typically be pro-rated for time in service to termination and paid at the usual time
(although the Committee retains discretion not to apply pro-rating and/or to pay the bonus earlier in appropriate circumstances).
DBP Awards
Awards lapse on the date of termination in the event of dismissal for gross misconduct. In other circumstances, awards will ordinarily continue and vest on the ordinary vesting date,
although the Committee retains discretion to vest any such award on the date of termination in appropriate circumstances (such as in the event of cessation due to death or ill-health).
In either case, the award will vest in full.
PSP
Unvested awards
Unvested awards held by the Director under the Company’s PSP will lapse or vest in accordance with the rules of the plan, which have been approved by shareholders. In summary, the
plan rules provide that awards can vest if employment ends by reason of redundancy, retirement, ill health or disability, death, sale of the Director’s employer out of the Group or any other
reason determined by the Committee. Unless the Committee decides that the award will vest at cessation, it will vest at the normal vesting date. In either case, the extent of vesting will
be determined by the Committee taking into account the satisfaction of the relevant performance conditions and, unless the Committee determines otherwise, applying a pro-rata reduction
based on the proportion of the performance period that has elapsed at the date of cessation.
Awards will remain subject to the holding period, unless the Committee determines otherwise. The Committee will only release the award early from its holding period in compassionate
leaver circumstances.
Vested awards in a holding period
If an Executive Director leaves employment after a PSP award has vested but during its holding period, that holding period will continue to apply, unless the Committee determines
otherwise. The Committee will only release the award early from its holding period in compassionate leaver circumstances.
Change of control
PSP
Awards under the PSP will generally vest early on a takeover or other relevant corporate event. The Committee will determine the level of vesting taking into account the satisfaction of
the relevant performance conditions and, unless the Committee determines otherwise, a pro-rata reduction based on the proportion of the performance period that has elapsed at the date
of the relevant event.
The holding period applying to awards will ordinarily come to an end on a change of control.
DBP
DBP awards will vest early and in full on a takeover or other relevant corporate event.
SAYE
SAYE options will vest on a change of control in accordance with the plan rules, which do not permit the exercise of discretion by the Committee.
Other payments
In appropriate circumstances, payments may also be made in respect of accrued holiday, outplacement and legal fees.
SAYE options will vest on termination of employment in accordance with the plan rules, which do not permit the exercise of discretion by the Committee.
Where a ‘buyout’ or other award is made outside the Company’s PSP in connection with the recruitment of an Executive Director, as permitted under the Listing Rules, the leaver provisions
would be determined at the time of the award.
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Service Contracts and letters of appointment
Details of the Executive Directors’ service contracts and Non-Executive Directors’ letters of appointment are set
out below.
Executive Directors
Contract commencement date
Notice period
Mark Milner
July 2019
12 months
Guy Millward
November 2020
12 months
Non-Executive Directors
Date of initial appointment
Notice period
Martin Morgan
May 2018
6 months
Paul Dollman
September 2015
3 months
Helen Sachdev
April 2020
3 months
William Macpherson
February 2021
3 months
Sophie Tomkins
April 2024
3 months
Payments for loss of office continued
The Committee reserves the right to make additional
exit payments where such payments are made in
good faith in discharge of an existing legal obligation
(or by way of damages for breach of such an
obligation) or by way of settlement or compromise
of any claim arising in connection with the termination
of a Director’s office or employment.
Non-Executive Directors
Non-Executive Directors have letters of appointment
with the notice periods referred to below, with
compensation limited to fees for the duration of the
notice period.
Legacy matters
The Committee reserves the right to make any
remuneration payment or payment for loss of office
(including exercising discretions in respect of any
such payment) notwithstanding that it is not in line
with the Policy set out above where the terms of the
payment were agreed:
•
before the Policy came into effect (provided
that in the case of any payments agreed on or
after 6 November 2014 they are consistent with
any applicable shareholder approved Directors’
Remuneration Policy in force at the time they
were agreed or were otherwise approved by
shareholders); or
•
at a time when the relevant individual was not
a Director of the Company (or other person to
whom the Policy set out above applies) and, in
the opinion of the Committee the payment was
not in consideration of the individual becoming
a Director of the Company (or other such person).
For these purposes, ‘payment’ includes the
satisfaction of any award of variable remuneration
and in relation to an award over shares the terms of
the payment are ‘agreed’ when the award is granted.
Statement of consideration
of employment conditions
elsewhere in the Company
The Committee generally considers pay and
employment conditions elsewhere in the Company
when considering the Executive Directors’
remuneration. When considering base salary
increases, the Committee reviews overall levels
of base pay increases offered to other employees.
Whilst employees were not actively consulted
on the design of the Policy, the Company has in
place employee feedback systems and employee
forums, via which the wider workforce’s views on
remuneration are fed back to the Committee in order
that decisions are taken with appropriate insight to
employees’ views.
Non-Executive appointments
at other companies
The Committee’s policy is that Executive Directors
may, by agreement with the Board, serve as
Non‑Executives of other companies and retain
any fees payable for their services.
Statement of consideration
of shareholder views
The Company is committed to open and transparent
dialogue with shareholders and welcomes
feedback on Executive and Non-Executive Directors’
remuneration. The Committee consulted with
shareholders in relation to the Policy and its
approach to Executive Director reward in respect
of FY25 and finalised its proposals having regard
to feedback received.
Directors’ remuneration report continued
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Wilmington plc Annual Report and Financial Statements 2024
95
Annual Report on remuneration
Certain details set out on pages 95 to 100 of this
report have been audited by Grant Thornton UK LLP.
Introduction (unaudited information)
The following section provides details of the
remuneration earned by the Directors in respect of
the year in line with the Directors’ Remuneration
Policy approved by shareholders at the
2021 Annual General Meeting
Single total figure of remuneration for
each Director (audited information)
The tables to the right report the total remuneration
receivable in respect of qualifying services by each
Director during the year.
2024
Total salary
Total salary
and fees
and fees(a)
(a)
£’000
£’000
Taxable
Taxable
benefits
benefits(b)
(b)
£’000
£’000
Pensions
Pensions
related
related
benefits
benefits(c)
(c)
£’000
£’000
Total fixed
Total fixed
remuneration
remuneration
£’000
£’000
Annual
Annual
bonus
bonus(d)
(d)
£’000
£’000
PSP
PSP(e)
(e)
£’000
£’000
Total variable
Total variable
remuneration
remuneration
£’000
£’000
Total
Total
£’000
£’000
Executive Directors
Mark Milner
417
32
18
467
486
692
1,178
1,645
Guy Millward
294
32
13
339
343
501
844
1,183
Non-Executive
Directors
Martin Morgan
147
—
—
147
—
—
—
147
Paul Dollman
57
—
—
57
—
—
—
57
Helen Sachdev
54
—
—
54
—
—
—
54
William Macpherson
54
54
54
Sophie Tomkins
10
—
—
10
—
—
—
10
2023
Executive Directors
Mark Milner
397
32
25
454
293
955
1,248
1,702
Guy Millward
280
32
11
323
207
177
384
707
Non-Executive
Directors
Martin Morgan
140
—
—
140
—
—
—
140
Paul Dollman
55
—
—
55
—
—
—
55
Helen Sachdev
52
—
—
52
—
—
—
52
William Macpherson
52
—
—
52
—
—
—
52
Directors’ remuneration report continued
a)
Total salary and fees – the amount of salary/fees received in
the year.
b)
Taxable benefits – the taxable value of benefits received in the
year (i.e. car allowance, private medical insurance and income
protection).
c)
Pensions related benefits – this is the amount of the cash
payments in lieu of pension contributions made in the year.
d)
Annual bonus — the value of the bonus earned in respect of
the year, of which 20% will be deferred in shares. A description
of performance against the objectives, which applied for the
year ended 30 June 2024, is provided on pages 96 to 97.
e)
PSP – the value of performance related incentives vesting in
respect of the financial year. A description of performance
against the targets which applied for the awards vesting in
respect of performance in the financial year is provided on
pages 97 to 99. The award will vest on 30 September 2024
and the estimated value of the award shown above is based on
the three-month average share price to 30 June 2024 (£3.84)
and the value of dividends that would have accrued on vested
shares during the performance period, which will be paid to Mr
Milner and Mr Millward. The PSP awards vesting in respect of
the year ended 30 June 2023 vested on 30 September 2023.
The value of the vested shares shown above is based on the
average share price over the 5 days before 29th September
of £3.10; in the 2023 Directors’ Remuneration Report, due to
timing, the value included was an estimated value based on
the three-month average share price to 30 June 2023 of £2.86.
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Wilmington plc Annual Report and Financial Statements 2024
96
Total salary and fees
Total salary and fees are based on the need to retain
the skills and knowledge that the Executive and
Non‑Executive Directors bring to the Company.
For the year ended 30 June 2024 (audited
information)
For the year ended 30 June 2024 Mark Milner’s
salary was increased by 5% to £416,850 and
Guy Millward’s salary was increased by 5% to
£294,000. Reflecting our intended approach
disclosed in last year’s report, these increases
are in line with the average increase for the wider
workforce in the UK and take into account the
ongoing strong performance of the Group and the
Executive Directors in their roles.
Pensions related benefits
For the year ended 30 June 2024 (audited
information)
Neither Mark Milner nor Guy Millward participated
in a pension scheme. They were paid an amount
of £18,133 and £12,671 respectively in the year
in lieu of pension contributions, reflective of
5% of annual salary net of employers’ national
insurance contributions.
Annual bonus
For the year ended 30 June 2024 (audited information)
Each Executive Director was eligible to earn a bonus of up to 125% of their salary, with the performance
measures weighted as follows in respect of the maximum opportunity.
Measure
Weighting (% of base salary)
Organic revenue growth1
53.1%
Adjusted Profit measure1
53.1%
Strategic and operational measures
18.8%
The following provides the Adjusted Profit and personal strategic objectives reference points together with the
out-turns for 2023/2024.
Minimum
target set
Maximum
target set
Performance out‑turn
Bonus earned as a %
of base salary
Organic revenue growth1
2.6%
6.6%
6.3%
47.8%
Adjusted Profit1
£17.0m
£20.8m
£22.9m
53.1%
1. Adjusted Profit is profit from ongoing operations before adjusting items, impairment and other income. Organic revenue growth is revenue growth excluding
non-core operations and acquisitions.
Strategic and operational measures
Objectives
Weighting
(% of base
salary)
Assessment of performance
Bonus
earned
(% of base
salary)
Improve customer engagement scores,
measured by NPS, to more than 58.7.
9.4%
NPS scores were 56.7, 67% of
objective achieved.
6.3%
Improve the employee engagement
measure, using the Peakon employee
engagement score, to 7.5.
9.4%
Score of 7.7 recorded,
objective achieved.
9.4%
Directors’ remuneration report continued
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Wilmington plc Annual Report and Financial Statements 2024
97
Annual bonus continued
Strategic and
operational measures continued
The Executive Directors therefore earned bonuses equal
to 116.6% of salary (equivalent to 93.3% of maximum
opportunity):
Mark Milner: £486,021
Guy Millward: £342,786
20% of the amount earned will be deferred into
shares for two years.
The Committee carefully considered the bonus
outturns in the context of overall performance,
including the quality of earnings and ROCE
performance, and the shareholder and
employee experience. The Committee
considered that the bonus outturns
were appropriate.
PSP
Awards vesting in respect of
the year ended 30 June 2024
(audited information)
PSP awards were granted to Mark Milner
and Guy Millward on 30 September 2021
that are due to vest on 30 September
2024. The awards were subject to EPS
growth and organic revenue growth over a
three-year period to 30 June 2024. The table
on the following page details the Company’s
performance against these performance
measures for the three-year performance period
and the vesting out-turn.
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Wilmington plc Annual Report and Financial Statements 2024
98
PSP continued
Awards vesting in respect of the year ended 30 June 2024
(audited information) continued
Element
Weighting
(% of award)
Target range
Performance
Vesting
Minimum
(25% of
maximum)
Maximum
(100% of
maximum)
Annual EPS
65%
18.0p
21.5p
22.96p
100%
Organic revenue growth1
35%
7.0%
9.0%
32.8%
100%
Total vesting outcome
100%
Number of
shares
granted2
Number
of shares
vesting
based on
performance
Dividend
equivalents3
Total value
of award on
vesting4
Amount
of award
attributable
to share price
appreciation
since grant
Mark Milner
164,946
164,946
15,249
£633,393
£265,563
Guy Millward
119,488
119,488
11,046
£458,834
£192,376
The vesting of these awards was also subject to a specific ROCE underpin that
they would not vest unless average ROCE over the performance period is at least
10%. Average ROCE over the performance period was 30.1% and accordingly this
underpin was satisfied.
Mark Milner and Guy Millward are required to hold all of the vested shares
(net of tax) for a minimum of two years post-vesting.
The Committee carefully considered the PSP outturn in the context of overall
performance, including the quality of earnings and ROCE performance, and the
shareholder and employee experience. The Committee considered that the PSP
outturn was appropriate.
PSP Awards granted during the year
In respect of the year ended 30 June 2024 the following PSP awards were granted
as detailed in the table below.
Name
Date of
grant
Type of
award
Maximum
opportunity
Number
of shares
Face value
at grant
% of award
vesting at
minimum
threshold
Mark Milner
29-Sep-23
PSP
125% of
salary
167,976
£520,726*
25%
Guy Millward
29-Sep-23
PSP
100% of
salary
94,778
£293,812*
25%
*The face value is based on a price of 310p, being the average share price from the five business days immediately
preceding the award being granted on 29 September 2023.
The performance measures are disclosed below:
65% of award — EPS in the 2025/26 financial year
Percentage of Award Vesting
Less than 24.4p
0.0%
24.4p
25.0%
More than 24.4p but less than 28.4p
On a straight line basis between
25.0% and 100.0%
28.4p or more than 28.4p
100.0%
35% of award — Organic revenue growth
over a performance period from the 2022/23
financial year to the 2025/26 financial year
Percentage of Award Vesting
Less than 3.4%
0.0%
3.4%
25.0%
More than 3.4% but less than 7.4%
On a straight line basis between
25.0% and 100.0%
7.4% or more than 7.4%
100.0%
1. Organic revenue growth excludes the impact of changes in foreign currency exchange rates and excluding the impact of changes in the Company’s portfolio from acquisitions and disposals.
2. A share price of £2.23 (five-day average share price prior to grant) were used to determine the number of shares granted. The value of the vested shares is estimated based on a share price of £3.84. The Committee did not consider
that it was necessary to exercise discretion in respect of share price appreciation since the grant date.
3. Calculated based on the value of dividends that would have accrued on vested shares during the performance period.
4. Calculated based on the three-month average share price to 30 June 2024 (£3.84).
Directors’ remuneration report continued
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Wilmington plc Annual Report and Financial Statements 2024
99
PSP continued
The Committee may reduce the extent of vesting if the Committee considers that
any value of the vested award represents a windfall gain caused by the impact on
the share price due to the Covid-19 pandemic. In assessing this, the Committee
will take into account a number of factors, including share price performance
over the vesting period on an absolute and relative basis against peer companies,
underlying financial performance of the Group during the performance period and
the impact of any significant events during the vesting period on the Group’s share
price or the market as a whole.
The Executive Directors will be required to retain all of the vested shares
(net of taxes) for a minimum of two years post-vesting.
Shareholding guidelines and statement of Directors’
share awards (audited information)
Shareholding guidelines for Executives have been adopted, linked to the outturn
from the PSP. At the time awards vest under the PSP (or any other Executive
plan established in the future), Executive Directors will be expected to retain no
fewer than 50% of vested shares (net of taxes) until such time as a total personal
shareholding equivalent to 200% of pre-tax base salary has been achieved.
This retention requirement also applies to 50% of the net vested shares under
deferred bonus awards.
Based on shareholdings at 30 June 2024 and the share price on that date of
390.00p, Mark Milner has a holding in excess of the guideline at 243% of base
salary and Guy Millward is working towards satisfaction of the guideline, with
a holding of 39% of salary. For these purposes, the holdings include beneficially
owned shares and the net of assumed tax shares subject to DBP awards.
The holdings of those persons who served as Directors during the year, and of their
families, are as follows:
Beneficial/
non-beneficial
At 30 June
2023
Movement
in year
At 30 June
2024
At 30 June
2024
Percentage
Mark Milner
Beneficial
79,759
179,512
259,271
0.29%
Guy Millward
Beneficial
—
29,703
29,703
0.03%
Martin Morgan
Beneficial
90,000
—
90,000
0.10%
Paul Dollman
Beneficial
40,000
—
40,000
0.04%
Helen Sachdev
Beneficial
10,000
—
10,000
0.01%
William Macpherson
Beneficial
10,000
—
10,000
0.01%
Sophie Tomkins
Beneficial
—
—
—
0.00%
As at 30 June 2024 the Company’s share price was 390.00p and its highest and
lowest share prices during the year ended 30 June 2024 were 400.00p and 257.00p
respectively. Interests are shown as a percentage of shares in issue at 30 June 2024.
Executive Directors’ interests under share schemes
(audited information)
Awards held under the PSP and SAYE scheme by each person who served
as a Director during the year ended 30 June 2024 are as follows:
Award
date
Type
of
award
Number of
shares at
01 July 2023
Granted
during
the year
Exercised
during
the year
Number of
shares at
30 June
2024
Date
which
awards
vest
Mark Milner
30 Sept
2020
PSP
285,714
—
(285,714)
—
30 Sep
2023
Mark Milner
19 Oct
2020
SAYE
18,750
—
(18,750)
—
1 Dec
2023
Mark Milner
30 Sept
20211
PSP
164,946
—
—
164,946
30 Sep
2024
Mark Milner
30 Sept
20222
PSP
175,726
—
—
175,726
30 Sept
2025
Mark Milner
29 Sept
20233
PSP
—
167,976
—
167,976
29 Sept
2026
Mark Milner
19 Apr
2024
SAYE
—
6,405
—
6,405
19 Apr
2027
Guy Millward
26 Feb
2021
PSP
52,791
—
(52,791)
—
30 Sept
2023
Guy Millward
30 Sept
2021
PSP
119,488
—
—
119,488
30 Sept
2024
Guy Millward
30 Sept
2022
PSP
99,150
—
—
99,150
30 Sept
2025
Guy Milward
29 Sept
20234
PSP
—
94,778
—
94,778
29 Sept
2026
1. Performance conditions for awards granted on 30 September 2021 are disclosed on page 98. The awards are
expected to vest at 100%.
2. Performance conditions for awards granted on 30 September 2022 are disclosed in the 2022/23 financial year
Annual Report and Accounts.
3. Performance conditions for awards granted on 29 September 2023 are disclosed on page 98.
4. Awards vested during the year are disclosed in the 2022/23 financial year Annual Report and Accounts.
Directors’ remuneration report continued
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Financial Statements
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Wilmington plc Annual Report and Financial Statements 2024
100
Dilution (unaudited information)
Awards under the Company’s discretionary schemes which may be satisfied by a
new issue of shares must not exceed 5.0% of the Company’s issued share capital
in any rolling ten -year period and the total of all awards satisfied via new issue
shares under all plans (both discretionary and all-employee) must not exceed
10.0% of the Company’s issued share capital in any rolling ten -year period.
At 30 June 2024, the headroom under the Company’s 5.0% and 10.0% limits was
1,045,309 and 3,887,871 shares respectively, out of an issued share capital of
89,575,012 shares.
Payments for loss of office (audited information)
No payments for loss of office were made during the year.
TSR performance graph (unaudited information)
The following graph shows, for the year ended 30 June 2024 and for each of the
nine previous years, the total shareholder return on a holding of the Company’s
ordinary shares compared with a hypothetical holding of shares of the same
kind and number as those by reference to which the FTSE All-Share Media
Index and FTSE Small Cap Index are calculated. These indices have been chosen
as the appropriate comparators because the Committee believes they contain
the most comparable companies against which to appraise the Company’s
share performance.
Directors’ remuneration report continued
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Wilmington plc Annual Report and Financial Statements 2024
101
Chief Executive Officer single figure
(unaudited information)
Total
remuneration
£’000
Annual
bonus
as a % of
maximum
opportunity
%
PSP as a %
of maximum
number of
shares
%
2023/24 Mark Milner
1,645
93.3%
100.0%
2022/23 Mark Milner
1,702*
59.0%
100.0%
2021/22 Mark Milner
1,066
100.0%
40.7%
2020/21 Mark Milner
769
100.0%
—
2019/20 Mark Milner
389
—
—
2018/19 Pedro Ros
398
21.8%
33.3%
2017/18 Pedro Ros
565
—
60.9%
2016/17 Pedro Ros
814
61.7%
84.1%
2015/16 Pedro Ros
677
73.1%
—
2014/15 Pedro Ros
671
78.5%
—
* Restated to reflect the value of the relevant PSP award at the date of vesting
as referred to on page 95.
Percentage change in remuneration
of Directors and employees
(unaudited information)
The year-on-year percentage change in salary,
taxable benefits and annual bonus on a rolling basis,
for the Executive and Non-Executive Directors and
employees of the Company on a full-time equivalent
basis. The average employee change has been
calculated by reference to the mean of employee pay
over the same period.
Average
employee
Mark
Milner
Guy
Millward1
Martin
Morgan
Paul
Dollman2
Helen
Sachdev
William
Macpherson1
Salary/fees
2023/24
4%
3%
5%
5%
11%
5%
5%
2022/23
9%
8%
5%
9%
12%
5%
5%
2021/22
1%
5%
2%
0%
0%
0%
0%
2020/21
0%
5%
0%
6%
4%
4%
0%
2019/20
2%
0%
0%
(3%)
(2%)
0%
0%
Taxable
benefits
2023/24
0%
0%
0%
0%
0%
0%
0%
2022/23
0%
0%
0%
0%
0%
0%
0%
2021/22
0%
(20%)
4%
0%
0%
0%
0%
2020/21
0%
34%
0%
0%
0%
0%
0%
2019/20
0%
0%
0%
0%
0%
0%
0%
Annual
bonus
2023/24
16%
66%
66%
0%
0%
0%
0%
2022/23
7%
(36%)
(38%)
0%
0%
0%
0%
2021/22
21%
31%
27%
0%
0%
0%
0%
2020/21
60%
100%
0%
0%
0%
0%
0%
2019/20
(50%)
(100%)
0%
0%
0%
0%
0%
1. In order to provide meaningful comparison with remuneration for 2021/22, Guy Millward and William Macpherson’s remuneration for 2020/21 has been
annualised, to reflect the fact that both joined the Board during the year ended 30 June 2021.
2. Paul Dollman was awarded an additional fee increase of £3,000 in 2023/24 to reflect the additional time and responsibilities associated with his holding the
position of SID.
The increase in average employee salary and fees in the year reflects an average salary increase for continuing
employees offset by the impact of restructuring and vacancies. The increase in Directors’ salaries in the year
reflects a holistic view of performance and other factors as outlined in the Remuneration Committee Chair’s
statement on pages 81 to 84. See previous Directors’ Remuneration reports for explanations as regards the
percentage change in salary, taxable benefits and annual bonus in respect of previous years.
Relative importance of spend on pay (unaudited information)
The difference in actual expenditure between 2022/23 and 2023/24 on remuneration for statutory continuing
employees in comparison to distributions to shareholders by way of dividend is detailed in the table on the
following page. The significant increase in distributions to shareholders by way of a dividend is primarily due
improved profits in the business. Remuneration decreased because of the disposal of businesses during the
year. Dividends therefore increased as a percentage of remuneration from 20% last year to 25% in FY24.
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102
Relative importance of spend on pay (unaudited information)
continued
2023/24
£’000
2022/23
£’000
Change
%
Expenditure on remuneration for employees
36,440
37,435
(3%)
Distributions to shareholders by way of a dividend
9,153
7,462
23%
CEO pay ratio
The following table discloses the ratios between the single total figure of remuneration (‘STFR’) of the
Chief Executive Officer for 2022/23 and 2023/24 and the lower quartile, median and upper quartile pay of
Wilmington’s UK employees for those years. The STFR of employees at each quartile has been calculated on a
full-time equivalent basis as at the final day of the relevant financial year. Wilmington is committed to ensuring
competitive pay for all colleagues.
Method
25th
percentile
pay ratio
Median
pay ratio
75th
percentile
pay ratio
2023/24
Option B
57:1
44:1
27:1
2022/23
Option B
54:1
41:1
22:1
2021/22
Option B
40:1
24:1
14:1
2020/21
Option B
28:1
21:1
13:1
2019/20
Option B
14:1
10:1
6:1
Single total figures of remuneration used to calculate the above ratio
CEO
25th percentile
pay ratio
Median pay ratio
75th percentile
pay ratio
Method
Total pay
and
benefits
£’000
Total
salary
£’000
Total pay
and
benefits
£’000
Total
salary
£’000
Total pay
and
benefits
£’000
Total
salary
£’000
Total pay
and
benefits
£’000
Total
salary
£’000
2023/24
Option B
1,645
417
29
28
37
35
62
56
Reporting regulations offer three methodologies
to calculate the CEO pay ratio – Options A, B and
C. The above table has been calculated by adopting
Option B, which was determined as the most
appropriate methodology for Wilmington. It was
decided that Option B would be the most appropriate
approach as Wilmington had already completed
a comprehensive analysis of UK employees for the
purpose of gender pay gap reporting. As such, the
most recent gender pay gap data, due to be published
in October 2024, was used to determine the
employees at the 25th percentile, median and 75th
percentile. A single total figure of remuneration was
then calculated for each of the relevant employees
using a consistent approach to the calculation of
the single total figure of remuneration for the Chief
Executive Officer on page 95 based on remuneration
as at 30 June 2024. For example, variable bonus
payments and employer pension contributions were
added to the gender pay data to ensure the STFR
reflected all relevant remuneration received in respect
of the year ended 30 June 2024. The pay data for a
sample of employees at each percentile was then
reviewed for accuracy and consistency and as such,
Wilmington believes the selected employees are
reasonably representative of the 25th, median, and
75th percentiles.
It is expected that the CEO pay ratio has the
potential to vary considerably year-on-year due
to the significant variable remuneration element
included. 100% of the PSP award granted to
the CEO on 30 September 2021 will vest on
30 September 2024 in respect of three-year
performance to 30 June 2024.
The Company believes that the median pay ratio
is consistent with the pay, reward and progression
policies for the Company’s UK employees as a whole.
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Implementation of the policy for the year ending
30 June 2025 (unaudited information)
The Committee Chair’s statement on pages 81 to 84 describes how the policy will
be implemented for the year ending 30 June 2025.
Details of the Remuneration Committee, advisors to
the Committee and their fees (unaudited information)
Details of the Directors who were members of the Committee during the year are
disclosed on page 84. The Committee has also received assistance from the Chief
Executive Officer with respect to the remuneration of the other Executive Director
and on the Company’s Remuneration Policy more generally. He is not in attendance
when his own remuneration is discussed.
During the year, the Committee received independent advice from the following
external consultants:
Committee’s advisors
2023/24
£’000
Aon Hewitt Limited provided advice to the Committee on performance analysis.
5
Deloitte LLP provided advice to the Committee on executive remuneration,
including annual bonus performance measures
21
Deloitte LLP was appointed by the Committee in 2013; the Group also engages
Deloitte LLP to provide advice in relation to the Company’s share plans. Deloitte is a
member of the Remuneration Consultants Group and, as such, voluntarily operates
under the Code of Conduct in relation to executive remuneration consulting in the
UK. Aon Hewitt Limited was appointed by the Committee in previous years. The
Committee took into account the Remuneration Consultants Group’s Code of Conduct
when reviewing the appointment of Aon Hewitt Limited and Deloitte LLP.
The Committee is satisfied that all advice received was objective and independent.
Details of the attendance of the Committee are set out in the table below:
Committee member
Member since
Committee
meetings
attended
Committee
meetings
eligible to
attend
Helen Sachdev (Committee Chair)
April 2020
3
3
Martin Morgan
May 2018
3
3
Paul Dollman
September 2015
3
3
William Macpherson
February 2021
3
3
Sophie Tomkins
April 2024
0
0
Statement of voting at general meeting
(unaudited information)
At the Annual General Meeting held on 22 November 2023 the Annual Report on
remuneration received the following votes from shareholders:
Annual Report on remuneration
Total number
of votes
% of
votes cast
For
68,553,069
91.8%
Against
6,127,082
8.2%
Total votes cast (for and against)
74,680,151
Votes withheld
0
Total votes (including withheld votes)
74,680,151
At the Annual General Meeting held on 3 November 2021 the Directors’
Remuneration Policy received the following votes from shareholders:
Directors’ Remuneration Policy
Total number
of votes
% of votes cast
For
72,064,696
97.88%
Against
1,559,282
2.12%
Total votes cast (for and against)
73,623,978
Votes withheld
0
Total votes (including withheld votes)
73,623,978
Directors’ remuneration report continued
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Financial Statements
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104
The Directors present their report together with the
audited consolidated financial statements for the year
ended 30 June 2024. The Directors’ report comprises
page 104 and the sections of the Annual Report
incorporated by reference are set out below which,
taken together, contain the information to be included
in the Annual Report, where applicable, under Listing
Rule 9.8.4.
Page
Board membership
65
Dividends
13
Directors’ long term incentives
82
Corporate Governance report
67
Future developments of the
business of the Group
10
Employee equality, diversity and involvement
27
Events after the reporting period
173
Subsidiaries of the Group
156
Financial risk management
158
Sustainability and greenhouse gas emissions
25
S172 statement and stakeholder engagement
21
Going concern
130
Viability statement
62
Notice concerning forward-looking
statements
This Annual Report contains forward-looking
statements. Although the Group believes that the
expectations reflected in such forward-looking
statements are reasonable, these statements are not
guarantees of future performance and are subject
to a number of risks and uncertainties and actual
results and events could differ materially from those
currently being anticipated as reflected in such
forward‑looking‑statements.
The terms ‘expect’, ‘estimate’, ‘forecast’, ‘target’,
‘believe’, ‘should be’, ‘will be’ and similar expressions
are intended to identify forward-looking statements.
Factors which may cause future outcomes to differ
from those foreseen in forward-looking statements
include, but are not limited to, those identified under
‘Principal risks and uncertainties’ on pages 47 to 55 of
this Annual Report.
The forward-looking statements contained in this
Annual Report speak only as of the date of publication
of this Annual Report and the Group therefore
cautions readers not to place undue reliance on any
forward-looking statements. Except as required by
any applicable law or regulation, the Group expressly
disclaims any obligation or undertaking to release
publicly any updates or revisions to any forward-
looking statements contained in this document
to reflect any change in the Group’s expectations
or any change in events, conditions or circumstances
on which any such statement is based.
General information
The Company is public limited and is incorporated
and domiciled in the UK. The Company is listed on
the main market of the London Stock Exchange. The
Company’s registered address is 10 Whitechapel
High Street, London E1 8QS.
Branches outside the UK
The Group does not operate any branches outside
the UK.
Research and development activities
The Group invests in research and development to
support the development of its businesses which can
rely on technology to deliver their data, information,
education and training services. An example of
investments undertaken in the year is the Digital
Transformation project.
Political donations
No political donations were made during the year
(2023: £nil).
Directors and Directors’ interests
All Directors are equally accountable for the proper
stewardship of the Company’s affairs. Executive and
Non-Executive Directors offer themselves for election
or re-election at each Annual General Meeting as a
result of the Company deciding to adopt best practice
guidelines and the 2018 UK Corporate Governance
Code, located on the FRC’s website at
www.frc.org.uk/directors/corporate-governance-
and-stewardship/uk-corporate-governance-code.
Details of the remuneration, service contracts,
letters of appointment and interests in the share
capital of the Company for the Directors who have
served during the year are set out in the Directors’
remuneration report on pages 81 to 103.
As disclosed in note 25 none of the Directors had
any material interest in any contract, other than an
employment contract, that was significant in relation
to the Group’s business at any time during the year.
Directors’ report and other statutory information
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Directors’ third-party
indemnity provisions
To reduce the possibility of the Company incurring
expenses which might arise from the need to
indemnify a Director or Officer from claims made
against them or the cost associated with their
defence, the Group has in place Directors’ and
Officers’ qualifying third-party liability insurance as
permitted by the Companies Act 2006, which has
been in force throughout the financial year and up
to the date of approval of these financial statements.
Inclusivity and employee
engagement
The Group’s recruitment policy ensures that all
job applications are reviewed on a fair basis free
from discrimination. This policy aligns strongly to
our work to embed an inclusive culture across the
Group, and to our accessibility agenda as set out
in the Sustainability report on page 36. The policy
includes provision to ensure that any candidate or
employee who has or develops a disability, long
term health condition or impairment is considered
fairly in our recruitment and career progression
processes. The Group also has a policy to ensure that
it makes reasonable adjustments for all candidates
or employees to reflect their needs and allow them
to participate fully, develop and thrive in our business.
Please refer to the Section 172 statement on page 22
for information regarding actions taken during the
year to maintain employee engagement.
Financial instruments
An explanation of the Group’s treasury policies and
existing financial instruments is set out in note 18
of the financial statements.
Purchase of own shares and sale
of treasury shares
In October 2023 Wilmington issued 823,568 ordinary
voting shares of £0.05 to satisfy the Company’s
obligations under its Performance Share Plan. In
December 2023 Wilmington issued 582,637 ordinary
voting shares of £0.05 to satisfy the Company’s
obligations under its SAYE Plan.
During the year 53,519 shares held by the Employee
Share Ownership Trust (‘ESOT’) were used to satisfy
the Company’s obligations under the SAYE Plan
and 54,610 shares held by the ESOT to satisfy the
Company’s obligations under its Performance Share
Plan. At 30 June 2024, the ESOT held 244,522 shares
(2023: 352,651) in the Company, which represents
0.3% (2023: 0.4%) of the called up share capital.
During the year 391 shares held in treasury were
used to satisfy the Company’s obligations under the
SAYE Plan. At 30 June 2024, 4,817 shares (2023:
5,208) were held in treasury, which represents 0.1%
(2023: 0.1%) of the share capital of the Company.
Contracts of significance
with shareholders
The Company and its subsidiary undertakings do not
have any contractual or other arrangements with any
continuing shareholders which are essential to the
business of the Company.
Takeover directive disclosures
As at 30 June 2024, the Company had only
one authorised class of share, namely ordinary
shares of 5p each, of which there were in issue
89,575,012 (2023: 88,168,807). There are no special
arrangements or restrictions relating to any of these
shares, whether in terms of transfers, voting rights,
or relating to changes in control of the Company.
The Company does not have any special rules in
place regarding the appointment and replacement of
Directors, or regarding amendments to the Company’s
articles of association.
Subject to various conditions, if the Company is taken
over, all share awards and options will vest and may
be exercised.
Except for share awards and options described above
there are no special conditions or agreements in place
which would take effect, alter or terminate in the
event of a takeover.
Apart from the interests of the Directors disclosed in
the Directors’ remuneration report and the substantial
interests listed on page 74 there are no individuals
or entities with significant holdings, either direct or
indirect, in the Company.
Annual General Meeting
A separate notice convening the Annual General
Meeting of the Company to be held at the head office,
10 Whitechapel High Street, London E1 8QS, on 28
November 2024 will be circulated to shareholders
with this Annual Report and financial statements.
Grant Thornton UK LLP, the Group’s auditors, have
indicated their willingness to continue in office and, on
the recommendation of the Audit Committee and in
accordance with Section 489 of the Act, a resolution
to re-appoint them will be put to the 2024 AGM.
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The Directors are responsible for preparing the
Annual Report and 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 financial
statements in accordance with UK adopted
international accounting standards (UK-adopted
International Accounting Standards). Under company
law the Directors must not approve the financial
statements unless they are satisfied that they give
a true and fair view of the state of affairs and profit
or loss of the Company and Group for that period. In
preparing these financial statements, the Directors are
required to:
•
select suitable accounting policies and then apply
them consistently;
•
make judgments and accounting estimates that
are reasonable and prudent; and
•
state whether applicable IFRSs as adopted by the
United Kingdom have been followed, subject to
any material departures disclosed and explained
in the financial statements.
The Directors are responsible for keeping adequate
accounting records that are sufficient to show and
explain the Company’s transactions and disclose with
reasonable accuracy at any time the financial position
of the Company and enable them to ensure that the
financial statements and the Directors’ remuneration
report comply with the Companies Act 2006. They
are also responsible for safeguarding the assets
of the Company and hence for taking reasonable
steps for the prevention and detection of fraud and
other irregularities.
The Directors confirm that:
•
so far as each Director is aware, there is no
relevant audit information of which the Company’s
auditors are unaware; and
•
the Directors have taken all the 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 Company’s
auditors are aware of that information.
The Directors are responsible for preparing the
Annual Report in accordance with applicable law
and regulations. Having taken advice from the Audit
Committee, the Directors consider the Annual Report
and the financial statements, taken as a whole,
provides the information necessary to assess the
Company’s performance, business model and strategy
and is fair, balanced and understandable.
The Directors are responsible for the maintenance and
integrity of the corporate and financial information
included on the Company’s website. Legislation in
the United Kingdom governing the preparation and
dissemination of financial statements may differ from
legislation in other jurisdictions.
To the best of our knowledge:
•
the Group financial statements, prepared in
accordance with IFRSs as adopted by the United
Kingdom, give a true and fair view of the assets,
liabilities, financial position and profit or loss of
the Company and the undertakings included in the
consolidation taken as a whole; and
•
the Strategic report and Directors’ report include
a fair review of the development and performance
of the business and the position of the Company
and the undertakings included in the consolidation
taken as a whole, together with a description of
the principal risks and uncertainties that they face.
Approved on behalf of the Board by:
Guy Millward
Chief Financial Officer
08 October 2024
Statement of Directors’ responsibilities
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Financial Statements
Contents
Independent auditors’ report
108
Consolidated income statement
124
Consolidated statement of comprehensive income
125
Balance sheets
126
Statements of changes in equity
127
Cash flow statements
129
Notes to the financial statements
130
Pro forma five year financial summary (unaudited)
174
Advisors and corporate calendar
175
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Opinion
Our opinion on the financial statements
is unmodified
We have audited the financial statements of
Wilmington Plc (the ‘Company’) and its subsidiaries
(the ‘Group’) for the year ended 30 June 2024, which
comprise the consolidated income statement, the
consolidated statement of comprehensive income,
the Group and Company balance sheets, the Group
and Company statements of changes in equity, the
Group and Company cash flow statements and notes
to the financial statements, including a summary of
significant accounting policies. The financial reporting
framework that has been applied in their preparation
is applicable law and UK-adopted international
accounting standards and, as regards the Company
financial statements, as applied in accordance with
the provisions of the Companies Act 2006.
In our opinion:
•
the financial statements give a true and fair view
of the state of the Group’s and of the Company’s
affairs as at 30 June 2024 and of the Group’s
profit for the year then ended;
•
the Group financial statements have been
properly prepared in accordance with UK-adopted
international accounting standards;
•
the Company financial statements have been
properly prepared in accordance with UK-adopted
international accounting standards as applied in
accordance with the provisions of the Companies
Act 2006; and
•
the financial statements have been prepared
in accordance with the requirements of the
Companies Act 2006.
Our evaluation of the directors’ assessment
of the Group’s and the Company’s ability to
continue to adopt the going concern basis
of accounting included:
•
evaluating the Group’s and the Company’s
cash position and performance throughout the
year, considering the Company’s ability to pay
dividends, concluding that the Group’s and the
Company’s ability to continue as a going concern
was not a significant risk;
•
obtaining management's base case forecasts for
the going concern period to 30 September 2025
and evaluating their integrity and suitability as a
basis for management to assess going concern;
•
assessing mathematical accuracy of
management’s forecasts, and corroborating to
supporting documentation and board approval
where appropriate;
•
challenging the key inputs underpinning the
forecasts including agreeing the opening net cash
position as 30 June 2024 to audited balances;
•
following the cancellation of the Group’s
loan facility on 8 August 2023, the audit
team’s assessment focused on liquidity,
reviewing forecast cash reserves throughout
the going concern period and challenging the
underlying assumptions;
•
considering the severity and plausibility
of management’s downside scenarios,
and evaluating the assumptions regarding
revenue reductions and increased costs under
each of these scenarios;
Basis for opinion
We conducted our audit in accordance with
International Standards on Auditing (UK) (ISAs (UK))
and applicable law. Our responsibilities under those
standards are further described in the ‘Auditor’s
responsibilities for the audit of the financial
statements’ section of our report. We are independent
of the Group and the Company in accordance with
the ethical requirements that are relevant to our audit
of the financial statements in the UK, including the
FRC’s Ethical Standard as applied to listed public
interest entities, and we have fulfilled our other
ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we
have obtained is sufficient and appropriate to provide
a basis for our opinion.
Conclusions relating to going concern
We are responsible for concluding on the
appropriateness of the directors’ use of the going
concern basis of accounting and, based on the audit
evidence obtained, whether a material uncertainty
exists related to events or conditions that may cast
significant doubt on the Group’s and the Company’s
ability to continue as a going concern. If we conclude
that a material uncertainty exists, we are required to
draw attention in our report to the related disclosures
in the financial statements or, if such disclosures
are inadequate, to modify the auditor’s opinion.
Our conclusions are based on the audit evidence
obtained up to the date of our report. However,
future events or conditions may cause the Group or
the Company to cease to continue as a going concern.
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Opinion continued
•
considering the severity and plausibility of management’s reverse stress
test scenario prepared to identify the conditions which would result in the
exhaustion of cash reserves, and evaluating the mitigating actions available to
management;
•
assessing whether the assumptions are consistent with our understanding of
the business obtained during the course of the audit and the changing external
circumstances arising from the global economic environment;
•
evaluating the accuracy of management's historical forecasting and the impact
of this on management's assessment;
•
inspecting unaudited post year end performance data and minutes of
meetings of the board of directors and all of its committees to corroborate
that any relevant post-year end events have been factored into management’s
forecasts; and
•
evaluating the appropriateness and adequacy of disclosures in respect of going
concern made in the financial statements.
In our evaluation of the directors’ conclusions, we considered the inherent risks
associated with the Group’s and the Company’s business model including effects
arising from macro-economic uncertainties such as the wider recessionary
environment, we assessed and challenged the reasonableness of estimates made
by the directors and the related disclosures and analysed how those risks might
affect the Group’s and the Company’s financial resources or ability to continue
operations over the going concern period.
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.
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 and the Company’s ability to continue as
a going concern for a period of at least twelve months from when the financial
statements are authorised for issue.
In relation to the Group’s reporting on how it has applied the UK Corporate
Governance Code, we have nothing material to add or draw attention to in relation
to the directors’ statement in the financial statements about whether the directors
considered it appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the directors with respect to going
concern are described in the relevant sections of this report.
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Our approach to the audit
Overview of our audit approach
Overall materiality:
Group: £1,090,000, which represents 5% of the
Group’s normalised profit before tax.
Company: £2,333,000 which represents
approximately 1% of the Company’s total assets.
The Company materiality is for the purposes of the
audit of the Company only financial statements. A
lower component materiality of £600,000 has been
used in respect of the audit of the Group financial
statements.
Key audit matters were identified as:
•
Occurrence and accuracy of revenue recognition
and completeness of deferred revenue within
existing complex revenue streams and in Astutis
(new in the current year)
•
Valuation of goodwill associated with the
Compliance Week and Astutis cash‑generating
units (new in the current year)
•
Accuracy and valuation of Acquired Intangibles
associated with Astutis (new in the current year)
•
Accuracy of the gain on disposal of UK Healthcare
(new in the current year)
Our auditor’s report for the year ended 30 June 2023
included a key audit matter entitled ‘Occurrence and
accuracy of revenue recognition and completeness
of deferred revenue within complex revenue streams’.
The key audit matter in the current year is also
focused on the revenue earned within the newly
acquired Astutis component.
Our auditor’s report for the year ended 30 June
2023 included a key audit matter entitled ‘Valuation
of goodwill associated with the Compliance Week
cash‑generating unit’. The key audit matter in the
current year is also focused on the valuation of
goodwill associated with the newly acquired Astutis
cash-generating unit.
Scoping:
We performed full scope audit procedures on the
financial statements of Wilmington plc and on the
financial information of Wilmington Shared Services
Limited, International Compliance Training Limited,
Mercia Group Limited, Wilmington FRA Inc, Axco
Insurance Information Services Limited, Bond Solon
Training Limited and Wilmington Healthcare Limited.
Full scope or specified audit procedures were
performed on the financial information of components
representing 78% of the Group’s continuing revenue
and 70% of the Group’s continuing profit before tax.
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In the graph below, we have presented the key audit matters and significant risks relevant to the audit. This is not
a complete list of all risks identified by our audit.
1. Occurrence and accuracy of revenue recognition
and completeness of deferred revenue within
complex revenue streams and in Astutis
2. Accuracy and valuation of Acquired Intangibles
associated with Astutis
3. Accuracy of the gain on disposal of
UK Healthcare
4. Valuation of goodwill associated
with the Compliance Week and Astutis
cash‑generating units
5. Management override of controls.
Extent of management
judgement
Low
Potential
financial
statement
impact
High
• Key audit matter • Significant
Low
High
Key audit matters
Key audit matters are those matters that, in our
professional judgement, were of most significance
in our audit of the financial statements of the current
period and include the most significant assessed
risks of material misstatement (whether or not due
to fraud) that we identified. These matters included
those that 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.
Description
Audit response
Disclosures
Our results
Key audit matters
1
2
3
5
4
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Key Audit Matter – Group
How our scope addressed the matter – Group
Occurrence and accuracy of revenue recognition and
completeness of deferred revenue within existing complex
revenue streams and in Astutis
The Group has reported revenues from continuing operations of £98.3m (2023:
£123.5m), as well as revenues from discontinued operations of £27.7m (£nil), with
deferred revenues at the year end of £28.3m (2023: £33.7m).
Under ISA (UK) 240 there is a rebuttable presumed fraud risk that revenue may be
misstated due to the improper recognition of revenue.
We have identified the occurrence and accuracy of revenue recognition related
to existing complex revenue streams and Astutis as one of the most significant
assessed risks of material misstatement due to fraud. Linked to this is a significant
risk over the completeness of deferred revenue at the year-end.
The nature of the Group’s revenue involves the delivery of services which
are recognised either at a point in time, or evenly over time. The audit team’s
assessment is that the vast majority of revenue transactions are non-complex with
no judgement applied over the amount recorded. Revenue recognised equates to
the value of the service, either recognised at a point in time, or spread evenly over
the period of each contract.
However, there are complex revenue streams within the components Wilmington
Healthcare Limited (“WHC”), Mercia Group Ltd (“MCA”), International Compliance
Training (“ICT”) and Astutis Limited, where revenue is recognised based on stage
of completion.
Management also cannot accurately disaggregate the total revenue within WHC
between the different revenue streams. This may give rise to an incentive and
opportunity to manipulate the amount of revenue and deferred revenue recognised
in the year. There is also a greater risk around manipulation of revenue within
WHC given this entity was disposed of in the year.
In responding to the key audit matter, we performed the following
audit procedures:
•
assessed the design effectiveness of controls related to revenue;
•
assessed the revenue accounting policies against the criteria of International
Financial Reporting Standard (‘IFRS’) 15 ‘Revenue from Contracts with
Customers’ to determine appropriate recognition and treatment of revenue;
•
tested prior period deferred income balances for complex revenue streams
by comparing a sample of items to the current year revenue listing to
determine whether the correct amount of revenue was recognised in the
current year;
•
selected a sample of revenue transactions in the year and agreed to
underlying support (such as signed customer contracts) to corroborate key
information used in determining recognition of revenue;
•
for each sample item relating to Astutis and continuing complex revenue
streams, calculated an expected amount of revenue based on contract terms
to confirm that revenue has been accurately recognised in the year, and
•
for each sample item relating to Astutis and continuing complex revenue
streams, calculated an expected amount to be deferred at the balance sheet
date based on the progress of the contract, to confirm the completeness
of the year end deferred income balance.
Key audit matters continued
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Key Audit Matter – Group
Following the disposal of WHC in the year, the deferred income relating to these
complex revenue streams on 30 June 2024 is not significant.
We have therefore focussed our significant fraud risk on revenue to the occurrence
and accuracy of revenue recognised in WHC, and the occurrence and accuracy
of the specific complex revenue streams in MCA and ICT.
Astutis was acquired in the year and recognises revenue based on stage of
completion. Furthermore, we are aware that the entity was not accounting for
all revenue streams appropriately as per IFRS 15 prior to acquisition, resulting
in understatement in deferred income.
We have therefore identified the occurrence and accuracy of all revenue
recognised within Astutis as a significant risk due to fraud, with an associated risk
over the completeness of deferred revenue.
Relevant disclosures in the Annual Report and
Financial Statements for the year ended 30 June 2024
•
Financial statements: Note 3, Segmental Information
•
Audit committee report: Revenue recognition
Our results
Based on our audit work, we did not identify material misstatements in relation
to the occurrence or accuracy of revenue recognised or the completeness
of deferred revenue.
Key audit matters continued
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Key Audit Matter – Group
How our scope addressed the matter – Group
Valuation of goodwill associated with the Compliance Week
and Astutis cash-generating units
We identified valuation of goodwill associated with the Compliance Week and Astutis
cash generating units (CGUs) as one of the most significant assessed risks of material
misstatement due to error.
International Accounting Standard (IAS) 36 ‘Impairment of Assets’ requires
management to assess at the end of each reporting period whether there is any
indication that an asset may be impaired, and to perform an annual assessment to
determine whether the Group’s goodwill and other intangible assets within a group of
cash generating units (‘CGU’) are impaired.
Management performed a risk assessment across all CGUs in the Group to identify
any individual CGUs which showed indicators of impairment or low headroom. We
identified the carrying value of the goodwill intangible asset associated with the
Compliance Week and Astutis CGUs as significant risks. This was based on multiple
risk factors, namely:
•
the negative headroom associated with Compliance Week and resulting £4.8m
impairment of this CGU;
•
the low headroom associated with the Astutis CGU;
•
the level of management judgement included in the inputs and assumptions into
the impairment calculation, such as the rate used to discount future cash flows,
the cash flow forecasts and the growth rates; and
•
the sensitivity of the carrying value to key assumptions.
In responding to the key audit matter, we performed the following audit procedures:
•
obtained an understanding of, and evaluated, the design effectiveness of controls
over the management’s impairment assessment process;
•
obtained management’s impairment assessment model for the Compliance Week
and Astutis CGUs, and tested the mathematical accuracy;
•
assessed the appropriateness of the asset amounts included in the carrying value
of these CGUs by agreeing to underlying accounting records;
•
obtained and challenged the key assumptions relating to the Compliance Week
and Astutis cash flow forecasts, including short and medium-term growth rates,
and contribution margins;
•
evaluated the appropriateness of the growth rates applied within the cash flow
forecasts, by reference to industry and market data;
•
tested the accuracy of management’s historic forecasting for these CGUs through
a comparison of budget to actual data;
•
assessed the discount rate applied to the forecast cash flows for these CGUs,
including an assessment by our valuation specialists, and benchmarking the rate
against that used by competitors;
•
performed sensitivity analysis on the value-in-use calculations prepared
by management for these CGUs; and
•
assessed the adequacy and completeness of related disclosures within the
annual report, including the sensitivity of the value in use of these CGUs to key
variables.
Relevant disclosures in the Annual Report and
Financial Statements for the year ended 30 June 2024
•
Financial statements: Note 12, Goodwill
•
Audit committee report: Goodwill and intangible asset impairment
Our results
Based on our audit work, we did not identify any material misstatements
relating to the impairment charge to Goodwill held in the Compliance Week
cash generating unit.
Based on our audit work, we did not identify material misstatements in relation
to the valuation of goodwill associated with the Astutis CGU.
Key audit matters continued
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Key Audit Matter – Group
How our scope addressed the matter – Group
Accuracy and valuation of Acquired Intangibles associated
with Astutis
We identified the accuracy and valuation of acquired intangibles associated with
Astutis as one of the most significant assessed risks of material misstatement due
to error.
On 23 November 2023, Astutis Limited was acquired by the Wilmington Group.
There can be significant judgement exercised in acquisition accounting under IFRS
3, which presents a risk that a material error could occur in the accounting for this
business combination. There is significant judgement inherent in the fair value
adjustments to recognise acquired intangibles and any resulting impact on the
goodwill recognised on acquisition.
We have identified a significant risk in relation to accuracy and valuation of
acquired intangible assets in accordance with IFRS 3 ‘Business Combinations’.
Associated with this, is a risk around the completeness and the fair value of the
assets and liabilities acquired, and consideration paid in the acquisition.
In responding to the key audit matter, we performed the following audit
procedures:
•
obtained an understanding of, and evaluated, the design effectiveness
of controls relating to management’s acquisition process;
•
obtained management’s assessment paper on their acquisition accounting,
and challenged conclusions reached by management in their assessment
of the acquisition, including key judgements made;
•
obtained the signed Share Purchase Agreement and identified key terms
which would impact acquisition accounting, such as acquisition date, and
evaluated whether management have properly identified, classified and
measured all the consideration transferred;
•
evaluated management’s assessment of the contingent shareholders
payment, and whether this meets the criteria to be recognised as employee
remuneration in the P&L over the relevant period rather than consideration
on acquisition;
•
tested the acquisition date balance sheet to supporting documentation,
performed tests of detail where required and challenged relevant
judgements made by management on fair value adjustments;
•
using our internal valuation specialists, assessed and challenged the
reasonableness of the valuation assumptions and techniques used by
management’s expert in their identification and valuation of acquired
intangible assets;
•
evaluated whether transaction costs incurred as part of the business
combination were accounted for appropriately;
•
tested the calculations and other journal entries in management’s acquisition
accounting workings; and
•
evaluated the adequacy and completeness of business combination
disclosures in the financial statements in accordance with the requirements
of IFRS 3.
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Key Audit Matter – Group
How our scope addressed the matter – Group
Relevant disclosures in the Annual Report and
Financial Statements for the year ended 30 June 2024
•
Financial statements: Note 10, Acquisition of Astutis
•
Audit committee report: Acquisitions & disposals
Our results
Based on our audit work, we did not identify any material misstatements
in relation to the accuracy or valuation of acquired intangibles associated
with Astutis.
Accuracy of the gain on disposal of UK Healthcare
The disposal of European Healthcare (made up of APM and UK Healthcare)
represents a substantial change to the Wilmington Group, previously contributing
approximately 25% to the Group’s revenue.
The disposal of APM on 26 April 2024 and disposal of the UK Healthcare division
on 27 June 2024 were both significant transactions for the Group and are unusual
in nature, giving rise to a gain on disposal of £21.4m, contributing to the net profit
on discontinued operations of £24.0m.
With respect to the disposal of APM, the audit team’s assessment is that there
is no complexity associated with the gain on disposal recorded since the only
type of consideration transferred was in the form of cash, therefore there are
no judgements or estimates involved in the calculation of the gain on disposal.
However, in order to determine the gain on disposal on UK Healthcare,
management must determine the fair value of consideration transferred,
which includes the consideration of key judgements and estimates in respect of the
valuation of loan note receivable, and the valuation of contingent consideration.
We identified the accuracy of the gain on disposal of UK Healthcare as one of the
most significant assessed risks of material misstatement due to error.
There is a risk that the gain on disposal may be calculated incorrectly resulting
in material misstatement.
In responding to the key audit matter, we performed the following
audit procedures:
•
obtained an understanding of, and evaluated, the systems and controls over
the disposal process;
•
obtained management’s assessment paper on the disposal accounting, and
challenged conclusions reached by management in their assessment of the
disposal, including key judgements made;
•
obtained the relevant signed Share Purchase Agreements and identified
key terms which would impact the gain on disposal accounting, including
evaluating whether management have properly identified, classified and
measured all the consideration transferred;
•
assessed the accounting treatment and fair value assessment of consideration
transferred, including the accuracy and valuation of the loan note receivable,
and the fair value assessment of contingent consideration receivable;
•
assessed the completeness and accuracy of the assets and liabilities disposed
of, testing completion adjustments to underlying support;
•
verified the arithmetical accuracy of management’s calculation of the gain
on disposal;
•
evaluated the appropriateness of the accounting policies disclosed in the
financial statements in line with the requirements of IFRS 5; and
•
evaluated the adequacy and completeness of disclosures relating to disposals
and discontinued operations in the financial statements in accordance with
the requirements of IFRS 5.
We did not identify any key audit matters relating to the audit of the financial statements of the parent company.
Key audit matters continued
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Our application of materiality
We apply the concept of materiality both in planning and performing the audit, and in evaluating the effect of identified misstatements on the audit and of uncorrected
misstatements, if any, on the financial statements and in forming the opinion in the auditor’s report.
Materiality was determined as follows:
Materiality measure
Group
Company
Materiality for
financial statements
as a whole
We define materiality as the magnitude of misstatement in the financial statements that, individually or in the aggregate, could reasonably
be expected to influence the economic decisions of the users of these financial statements. We use materiality in determining the nature,
timing and extent of our audit work.
Materiality threshold
£1,090,000 (2023: £1,080,000), which represents
5% of normalised profit before tax.
£2,333,000 (2023: £1,941,000), which represents approximately
1% of the Company’s total assets.
Significant judgements
made by auditor in
determining materiality
In determining materiality, we made the following
significant judgements:
•
Normalised PBT was considered the most appropriate
benchmark because the movement in profit before tax
continues to exhibit a strong correlation with the activity
of the business.
•
The impact of any material non-recurring items was removed,
namely the gain on disposal and the impairment in the year.
We then determined materiality at 5% of this normalised profit
before tax amount.
Materiality for the current year is higher than the level that
we determined for the year ended 30 June 2023 due to the
increased level of normalised profitability within the Group
in the current period.
In determining materiality, we made the following
significant judgements:
•
Total assets was considered the most appropriate benchmark
because the Company’s purpose is to hold material investments
in its subsidiary companies and in the amounts receivable from
subsidiary companies, and as it does not trade.
Materiality for the current year is higher than the level that we
determined for the year ended 30 June 2023 due to the increase
in the Company’s total assets in the current year.
A lower component materiality of £600,000 has been used in
respect of the Company to provide sufficient assurance for the audit
of the Group financial statements.
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Materiality measure
Group
Company
Performance materiality
used to drive the extent
of our testing
We set performance materiality at an amount less than materiality for the financial statements as a whole to reduce to an appropriately
low level the probability that the aggregate of uncorrected and undetected misstatements exceeds materiality for the financial
statements as a whole.
Performance materiality
threshold
£817,500, (2023: £810,000), which is 75% of financial
statement materiality.
£1,749,750 (2023: £1,455,800), which is 75%
of financial statement materiality.
Significant judgements
made by auditor in
determining materiality
In determining performance materiality, we made the following
significant judgements:
•
Our experience with auditing the financial statements of the
Group in previous years – based on the number and quantum
of identified misstatements in the prior year audit and
management’s attitude to correcting identified misstatements
•
Our assessment of the strength and effectiveness of the
control environment; and
•
The number of components within the Group and the
extent of audit procedures planned and performed
at these components.
In determining performance materiality, we made the following
significant judgements:
•
Our experience with auditing the financial statement of
the Company in previous years – based on the number and
quantum of identified misstatements in the prior year audit and
management’s attitude to correcting identified misstatements;
and
•
Our assessment of the strength and effectiveness of the
control environment.
Specific materiality
We determine specific materiality for one or more particular classes of transactions, account balances or disclosures for which
misstatements of lesser amounts than materiality for the financial statements as a whole could reasonably be expected to influence
the economic decisions of users taken on the basis of the financial statements.
Specific materiality
We determined a lower level of specific materiality for the
following areas:
•
Related party transactions; and
•
Directors’ remuneration.
We determined a lower level of specific materiality for the
following areas:
•
Related party transactions; and
•
Directors’ remuneration.
Communication
of misstatements to
the audit committee
We determine a threshold for reporting unadjusted differences to the audit committee.
Threshold for communication
£54,500 (2023: £54,000), which represents 5% of financial
statement materiality, and misstatements below that threshold
that, in our view, warrant reporting on qualitative grounds.
£116,700 (2023: £97,050), which represents 5% of financial
statement materiality, and misstatements below that threshold
that, in our view, warrant reporting on qualitative grounds.
Our application of materiality continued
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Our application
of materiality continued
The graph below illustrates how performance
materiality interacts with our overall materiality
and the threshold for communication to the
Audit Committee.
Normalised profit before tax
Financial statements materiality
£21,859,000
£1,090,000
95%
5%
75%
5%
TfC
£54,500
PM
£817,500
75%
5%
Total Assets
Financial statements materiality
£228,651,000
£2,333,000
capped
99%
1%
TfC
£116,700
PM
£1,749,750
An overview of the scope
of our audit
We performed a risk-based audit that requires an
understanding of the Group’s and the Company’s
business and in particular matters related to:
Understanding the group,
its components, and their environments,
including group‑wide controls
•
obtaining an understanding of the Group and
its environment, including Group-wide controls,
and assessing the risks of material misstatement
at the Group level;
•
evaluating the design and implementation
of controls over the financial reporting systems
and the effectiveness of the control environment
as part of our risk assessment; and
•
assessing the significance of each identified
component to determine audit response based
on a measure of materiality.
Identifying significant components
•
in setting our audit scope we assessed qualitative
and quantitative factors to identify components
which are significant to the Group;
•
with regards to quantitative measures, we
determined any individual component with
significant contribution to consolidated revenues
or consolidated underlying profit or loss before
tax to be financially significant to the Group;
•
other significant components were identified as
Wilmington plc and Wilmington Shared Services
Limited, based on qualitative factors.
•
four further components were identified as
being financially significant due to quantitative
reasons and therefore subject to full scope audit
procedures, being International Compliance
Training Limited, Mercia Group Limited,
Wilmington FRA Inc, and Wilmington Healthcare
Limited. All work in relation to these components
was performed by the Group engagement team.
•
the six significant components subjected to
full-scope audit procedures account for 48%
of the Group’s revenues, and 36% of the Group’s
continuing profit before tax. All work in relation
to these components was performed by the Group
engagement team;
•
two further components were identified as being
material to the group but not significant and
were therefore subject to audit using component
materiality, being Axco Insurance Information
Services Limited and Bond Solon Training Limited.
All work in relation to these components was
performed by the Group engagement team;
•
one further component was identified for which
specified audit procedures on specific balances
was performed, being Astutis Limited. The work
on this component was targeted according to the
nature of the balances within this component.
All work in relation to this component was
performed by the Group engagement team.
•
the remaining 25 components were subject
to analytical procedures commensurate with
their significance to the Group’s results and
financial position.
Overall materiality – Group
Overall materiality – Company
FSM: Financial statement materiality, PM: Performance materiality,
TfC: Threshold for potential communication to the audit committee
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•
The subsidiary Bond Solon Training Limited has
been identified as being not financially significant
but material and therefore subject to a full scope
audit in the current year, whereas it was identified
as requiring specific audit procedures in the
previous year.
•
The subsidiary Astutis due to its acquisition in the
year was identified as having specific material
balances over which specific audit procedures
were required in the current year for the purposes
of achieving sufficient audit evidence over Group
identified significant risks.
Other information
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 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 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.
•
for components subject to specified audit
procedures, audit procedures were performed on
revenue balances to provide us with assurance
for the related key audit matter of the recognition
of revenue.
Performance of our audit
•
work performed over full scope components and
specified procedures components covered 78%
of the Group’s continuing revenue and 70% of
the Group’s continuing profit before tax; and
•
the remaining components of the Group were
subject to analytical procedures commensurate
with their significance to the Group’s results and
financial position.
Audit approach
No. of
components
% coverage
Continuing
Revenue
% coverage
Profit
Before Tax
Full-scope audit
8
73%
70%
Specified audit
procedures
1
5%
0%
Analytical
procedures
25
22%
30%
Total
34
100%
100%
Changes in approach from previous period
•
The subsidiaries Mercia Group Limited and
Wilmington FRA Inc have been identified as
individually financially significant in the current
year, whereas they were identified as being
material but not significant in the prior year. A full
scope audit was performed on these entities in the
current year and prior year.
An overview of the scope
of our audit continued
Type of work to be performed on
financial information of parent and other
components (including how it addressed
the key audit matters)
•
for the Company and other financially significant
components requiring full-scope audit procedures,
we evaluated the design and implementation
of controls over the financial reporting systems
identified as part of our risk assessment and
addressed critical accounting matters. We then
undertook substantive testing on significant
transactions and material account balances;
•
for components identified as not being financially
significant but still requiring full-scope audit
procedures, the financial information of each
component was subject to procedures that were
performed to component materiality;
•
the full scope audits included the procedures
described earlier for the key audit matters of:
•
Occurrence and accuracy of revenue
recognition and completeness of deferred
revenue within existing complex revenue
streams and in Astutis
•
Valuation of goodwill associated with
the Compliance Week and Astutis
cash‑generating units
•
Accuracy and valuation of Acquired
Intangibles associated with Astutis
•
Accuracy of the gain on disposal of
UK Healthcare
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•
the directors’ statement on fair, balanced and
understandable, set out on page 106;
•
the board’s confirmation that it has carried out a
robust assessment of the emerging and principal
risks, set out on pages 47 to 50;
•
the section of the annual report that describes the
review of the effectiveness of risk management
and internal control systems, set out on
pages 47 to 50; and
•
the section describing the work of the audit
committee, set out on pages 76 to 78.
Responsibilities of directors
As explained more fully in the statement of directors’
responsibilities, set out on page 106, the directors
are responsible for the preparation of the financial
statements and for being satisfied that they give a
true and fair view, and for such internal control as
the directors determine is necessary to enable the
preparation of financial statements that are free from
material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors
are responsible for assessing the Group’s and the
Company’s ability to continue as a going concern,
disclosing, as applicable, matters related to going
concern and using the going concern basis of accounting
unless the directors either intend to liquidate the Group
or the Company or to cease operations, or have no
realistic alternative but to do so.
•
the Company financial statements and the part of
the directors’ remuneration report to be audited
are not in agreement with the accounting records
and returns; or
•
certain disclosures of directors’ remuneration
specified by law are not made; or
•
we have not received all the information and
explanations we require for our audit.
Corporate governance statement
We have reviewed the directors’ statement in relation
to going concern, longer-term viability and that part
of the Corporate Governance Statement relating to
the Group’s compliance with the provisions of the
UK Corporate Governance Code specified for our
review by the Listing Rules.
Based on the work undertaken as part of our audit,
we have concluded that each of the following
elements of the Corporate Governance Statement
is materially consistent with the financial statements
or our knowledge obtained during the audit:
•
the directors’ statement with regards to the
appropriateness of adopting the going concern
basis of accounting and any material uncertainties
identified, set out on pages 130 to 131;
•
the directors’ explanation as to their assessment
of the Group’s prospects, the period this
assessment covers and why the period is
appropriate, set out on page 62;
•
the director’s statement on whether they have
a reasonable expectation that the Group will
be able to continue in operation and meet its
liabilities, set out on pages 130 to 131;
An overview of the scope
of our audit continued
Our opinions on other matters prescribed
by the Companies Act 2006 are unmodified
In our opinion, the part of the directors’ remuneration
report to be audited has been properly prepared in
accordance with 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.
Matter on which we are required to report
under the Companies Act 2006
In the light of the knowledge and understanding of
the Group and the Company and their environment
obtained in the course of the audit, we have not
identified material misstatements in the strategic
report or the directors’ report.
Matters on which we are required
to report by exception
We have nothing to report in respect of the following
matters in relation to which the Companies Act 2006
requires us to report to you if, in our opinion:
•
adequate accounting records have not been kept
by the Company, or returns adequate for our audit
have not been received from branches not visited
by us; or
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from fraud is inherently more difficult than
detecting those that result from error, as fraud
may involve collusion, deliberate concealment,
forgery or intentional misrepresentations.
Also,the further removed non-compliance
with laws and regulations is from events and
transactions reflected in the financial statements,
the less likely we would become aware of it;
•
The engagement partner assessed whether
the engagement team collectively had the
appropriate competence and capabilities to
identify and recognise non-compliance with laws
and regulations through an assessment of the
engagement team’s:
•
understanding of, and practical experience
with, audit engagements of a similar nature
and complexity, through appropriate training
and participation; and
•
knowledge of the industry in which the Group
and Company operate.
•
Team communications in respect of potential
non-compliance with laws and regulations and
fraud included the potential for fraud in revenue
recognition through manipulation of deferred
income. This is also reported as a key audit
matter in the key audit matters section of our
report, where the matter and specific procedures
performed in response to this matter are described
in more detail.
A further description of our responsibilities for
the audit of the financial statements is located
on the Financial Reporting Council’s website at:
www.frc.org.uk/auditorsresponsibilities.
This description forms part of our auditor’s report.
legal department. We corroborated our inquiries
through our review of board minutes and papers
provided to the Audit Committee.
•
We assessed the susceptibility of the Group’s
and the Company’s financial statements to
material misstatement, including how fraud might
occur. Audit procedures performed by the Group
engagement team included:
•
identifying and assessing the design and
implementation of controls management has
in place to prevent and detect fraud;
•
obtaining an understanding of how those
charged with governance considered and
addressed the potential for override of
controls or applied other inappropriate
influence over the financial reporting process;
•
challenging assumptions and judgements
made by management in its significant
judgements and accounting estimates,
including those inherent to the accounting
of acquisitions and disposals, and relating to
the impairment of the Compliance Week cash
generating unit in the current year;
•
identifying and testing journal entries,
inparticular any journal entries posted with
unusual account combinations; and
•
assessing the extent of compliance with the
relevant laws and regulations.
•
These audit procedures were designed to provide
reasonable assurance that the financial statements
were free from fraud or error. The risk of not
detecting a material misstatement due to fraud is
higher than the risk of not detecting one resulting
from error and detecting irregularities that result
An overview of the scope
of our audit continued
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. 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 frameworks applicable to the Group
and the Company and the sector in which they
operate. We determined that the following
laws and regulations were most significant:
UK‑adopted international accounting standards,
the Companies Act 2006, the Listing Rules, the
UK Corporate Governance Code and UK corporate
taxation laws.
•
We obtained an understanding of how the Group
and the Company are complying with those legal
and regulatory frameworks by making inquiries
of management and of the Group’s head of
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An overview of the scope of our audit
continued
Other matters which we are required to address
We were appointed by the Board on 22 November 2023 to audit the financial
statements for the year ending 30 June 2024. Our total uninterrupted period of
engagement is 6 years, covering the years ended 30 June 2019 to 30 June 2024.
The non-audit services prohibited by the FRC’s Ethical Standard were not provided
to the Group or the Company and we remain independent of the Group and the
Company in conducting our audit.
Our audit opinion is consistent with the additional report to the audit committee.
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.
Sergio Cardoso
Senior Statutory Auditor
for and on behalf of Grant Thornton UK LLP
Statutory Auditor, Chartered Accountants
London
08 October 2024
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Notes
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Continuing operations
Revenue
3
98,324
93,065
Operating expenses before amortisation of intangibles excluding computer software, impairment and adjusting items
(76,645)
(73,792)
Impairment of goodwill
4b
(4,434)
—
Amortisation of intangible assets excluding computer software
4b
(2,090)
(1,078)
Adjusting items
4b
(598)
(147)
Operating expenses
5
(83,767)
(75,017)
Other income – gain on disposal of subsidiaries
11
5,465
2,212
Other income – gain on disposal of property, plant and equipment and lease modification
4a
2,189
—
Operating profit
22,211
20,260
Finance income
6
2,172
478
Finance expense
6
(175)
(246)
Profit before tax
24,208
20,492
Taxation
7
(7,009)
(3,317)
Profit for the year from continuing operations
17,199
17,175
Profit for the year from discontinued operations
11
24,011
3,020
Profit for the year attributable to owners of the parent
41,210
20,195
Earnings per share from continuing operations:
Basic (p)
9
19.33
19.51
Diluted (p)
9
18.96
19.03
Earnings per share from continuing and discontinued operations:
Basic (p)
9
46.32
22.94
Diluted (p)
9
45.44
22.38
The notes on pages 130 to 173 are an integral part of these consolidated financial statements.
Consolidated income statement | for the year ended 30 June 2024
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Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Profit for the year
41,210
20,195
Other comprehensive expense:
Items that may be reclassified subsequently to the income statement
Currency translation differences
(238)
(991)
Other comprehensive expense for the year, net of tax
(238)
(991)
Total comprehensive income for the year attributable to owners of the parent
40,972
19,204
Items in the statement above are disclosed net of tax. The income tax relating to each component of other comprehensive income is disclosed in note 7.
The notes on pages 130 to 173 are an integral part of these financial statements.
Consolidated statement of comprehensive income | for the year ended 30 June 2024
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Balance sheets | as at 30 June 2024
Group
Company
Notes
2024
£’000
2023
£’000
2024
£’000
2023
£’000
Non-current assets
Goodwill
12
52,763
60,561
—
—
Other intangible assets
13
10,236
5,734
—
—
Property, plant and equipment
14
3,085
7,015
1,825
3,384
Investment in subsidiaries
15
—
—
43,161
49,420
Deferred consideration receivable
11
14,786
1,152
—
—
Deferred tax assets
19
—
925
924
845
80,870
75,387
45,910
53,649
Current assets
Trade and other receivables
16
20,339
27,391
126,053
114,857
Deferred consideration receivable
11
1,732
752
—
351
Cash and cash equivalents
67,515
42,173
56,688
27,483
Assets of disposal group held for sale
11
1,196
—
—
—
90,782
70,316
182,741
142,691
Total assets
171,652
145,703
228,651
196,340
Current liabilities
Trade and other payables
17
(50,460)
(55,966)
(131,331)
(66,510)
Lease liabilities
22
(1,257)
(975)
(923)
(202)
Current tax liabilities
(1,058)
(44)
(170)
(170)
Provisions
23
(154)
(307)
—
—
Liabilities of disposal group held for sale
11
(486)
—
—
—
(53,415)
(57,292)
(132,424)
(66,882)
Non-current liabilities
Lease liabilities
22
(1,571)
(6,235)
(838)
(4,445)
Deferred tax liabilities
19
(1,351)
(607)
—
—
Provisions
23
—
(921)
—
—
(2,922)
(7,763)
(838)
(4,445)
Total liabilities
(56,337)
(65,055)
(133,262)
(71,327)
Net assets
115,315
80,648
95,389
125,013
Equity
Share capital
20
4,478
4,408
4,478
4,408
Share premium
20
47,463
45,553
47,463
45,553
Treasury and ESOT reserves
20
(617)
(786)
(28)
(30)
Share based payments reserve
2,889
2,635
2,889
2,635
Translation reserve
3,193
3,431
—
—
Retained earnings
57,909
25,407
40,587
72,447
Total equity
115,315
80,648
95,389
125,013
Wilmington plc, the parent company, recorded a
loss of £23,152,000 (2023: profit of £2,014,000)
during the year.
The notes on pages 130 to 173 are an integral
part of these consolidated financial statements.
The financial statements on pages 124 to 173
were approved and authorised for issue
by the Board and signed on their behalf
on 08 October 2024.
Mark Milner
Chief Executive Officer
Guy Millward
Chief Financial Officer
Registered number: 03015847
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Statements of changes in equity | for the year ended 30 June 2024
Group
Share capital,
share premium,
ESOT shares
and treasury
shares
(note 20)
£’000
Share based
payments
reserve
£’000
Translation
reserve
£’000
Retained
earnings
£’000
Total equity
£’000
At 1 July 2022
48,851
2,141
4,422
11,675
67,089
Profit for the year
—
—
—
20,195
20,195
Other comprehensive expense for the year
—
—
(991)
—
(991)
48,851
2,141
3,431
31,870
86,293
Transactions with owners:
Dividends paid
—
—
—
(7,462)
(7,462)
Issue of share capital
17
—
—
—
17
Performance share plan awards vesting
—
(717)
—
854
137
Save As You Earn options settlement via ESOT
154
(11)
—
(16)
127
Save As You Earn options settlement via treasury shares
153
—
—
(64)
89
Share based payments
—
1,222
—
—
1,222
Tax on share based payments
—
—
—
225
225
At 30 June 2023
49,175
2,635
3,431
25,407
80,648
Profit for the year
—
—
—
41,210
41,210
Other comprehensive expense for the year
—
—
(238)
—
(238)
49,175
2,635
3,193
66,617
121,620
Transactions with owners:
Dividends paid
—
—
—
(9,153)
(9,153)
Issue of share capital
71
—
—
—
71
Issue of share premium
1,910
—
—
—
1,910
Performance share plan awards vesting settlement via share issue
—
(1,109)
—
(139)
(1,248)
Performance share plan options settlement via ESOT
127
(67)
—
—
60
Save As You Earn options vesting settlement via share issue
—
(174)
—
212
38
Save As You Earn options settlement via treasury shares
1
—
—
—
1
Save As You Earn options settlement via ESOT
40
(29)
—
(7)
4
Share based payments
—
1,633
—
—
1,633
Tax on share based payments
—
—
—
379
379
At 30 June 2024
51,324
2,889
3,193
57,909
115,315
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Company
Share capital,share
premium and
treasury
shares (note 20)
£’000
Share based
payments
reserve
£’000
Retained
earnings
£’000
Total
£’000
At 1 July 2022
49,761
2,141
76,896
128,798
Profit for the year
—
—
2,014
2,014
49,761
2,141
78,910
130,812
Transactions with owners:
Dividends paid
—
—
(7,462)
(7,462)
Issue of share capital
17
—
—
17
Performance share plan awards vesting
—
(717)
854
137
Save As You Earn options settlement via ESOT
—
(11)
(16)
(27)
Save As You Earn options settlement via treasury shares
153
—
(64)
89
Share based payments
—
1,222
—
1,222
Tax on share based payments
—
—
225
225
At 30 June 2023
49,931
2,635
72,447
125,013
Loss for the year
—
—
(23,152)
(23,152)
49,931
2,635
49,295
101,861
Transactions with owners:
Dividends paid
—
—
(9,153)
(9,153)
Issue of share capital
71
—
—
71
Issue of share premium
1,910
—
—
1,910
Performance share plan awards vesting settlement via share issue
—
(1,109)
(139)
(1,248)
Performance share plan options settlement via ESOT
—
(67)
—
(67)
Save As You Earn options vesting settlement via share issue
—
(174)
212
38
Save As You Earn options settlement via treasury shares
1
—
—
1
Save As You Earn options settlement via ESOT
—
(29)
(7)
(36)
Share based payments
—
1,633
—
1,633
Tax on share based payments
—
—
379
379
At 30 June 2024
51,913
2,889
40,587
95,389
The notes on pages 130 to 173 are an integral part of these consolidated financial statements.
Statements of changes in equity | for the year ended 30 June 2024 continued
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Cash flow statements | for the year ended 30 June 2024
Group
Company
Notes
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Cash flows from operating activities
Cash generated from operations before adjusting items
27
29,747
33,205
28,559
19,331
Cash flows for adjusting items – operating activities
(1,826)
(375)
(1,826)
(375)
Cash flows from tax on share based payments
(222)
(2)
(222)
(2)
Cash generated from operations
27,699
32,828
26,511
18,954
Interest received
1,946
344
1,675
324
Tax paid
(7,115)
(3,268)
(5,466)
(2,906)
Net cash generated from operating activities
22,530
29,904
22,720
16,372
Cash flows from investing activities
Disposal of subsidiaries net of cash
11
26,561
1,549
—
—
Purchase of subsidiary net of cash
10
(15,923)
—
—
—
Cash paid for purchase of group entity
—
—
(20,130)
—
Proceeds from sale of group entity
—
—
34,619
2,286
Deferred consideration received
888
250
351
—
Cash flows for adjusting items – investing activities
(59)
(6)
(59)
(6)
Purchase of property, plant and equipment
(132)
(461)
—
—
Proceeds from disposal of property, plant and equipment
884
13
—
—
Purchase of intangible assets
(235)
(595)
—
—
Net cash generated from investing activities
11,984
750
14,781
2,280
Cash flows from financing activities
Dividends paid to owners of the parent
(9,153)
(7,462)
(9,153)
(7,462)
Cash received from sale of shares for share vesting
927
573
927
573
Share issuance costs
(70)
(14)
(70)
(14)
Payment of lease liabilities
(881)
(2,109)
—
—
Net cash used in financing activities
(9,177)
(9,012)
(8,296)
(6,903)
Net increase in cash and cash equivalents
25,337
21,642
29,205
11,749
Cash and cash equivalents at beginning of the year
42,173
20,543
27,483
15,734
Exchange gain/(loss) on cash and cash equivalents
5
(12)
—
—
Cash classified as held for sale
293
—
—
—
Cash and cash equivalents at end of the year
67,808
42,173
56,688
27,483
The notes on pages 130 to 173 are an integral part of these consolidated financial statements.
Please see note 28 for a reconciliation of net cash movements.
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General information
The Company is a public company limited by shares, incorporated and domiciled
in the UK. The address of its registered office is 10 Whitechapel High Street,
London E1 8QS.
The Company is listed on the Main Market on the London Stock Exchange.
The Company is a provider of data, information, education and training in the
global Governance, Risk and Compliance (‘GRC’) markets.
1. Statement of accounting policies
The material accounting policy information applied in preparing the financial
statements are outlined below. These policies have been consistently applied for
all the years presented, unless otherwise stated.
a) Basis of preparation
The Group and Company consolidated financial statements have been prepared
in accordance with UK-adopted International Financial Reporting Standards ('IFRS')
and the Companies Act 2006 applicable to companies reporting under IFRS.
The Group have taken the Section 408 exemption and therefore not included the
Company income statement.
The consolidated financial statements have been prepared under the historical
cost convention, except in respect of certain financial instruments that have been
measured at fair value. The consolidated financial statements are presented in
Sterling, the functional currency of Wilmington plc, the parent company. All values
are rounded to the nearest thousand pounds (£’000) except where otherwise
indicated.
Pursuant to Section 408 of the Companies Act 2006 the Company’s own income
statement and statement of other comprehensive income are not presented
separately in the Company financial statements, but they have been approved
by the Board.
Going concern
Management prepared forecasts for the assessment period to provide a ‘base case’
scenario, considered to reflect the most likely outcome based on detailed analysis
of current trading, expected future trends, and potential impact of known risks.
The results of this base case scenario modelling demonstrate adequate resources
to continue in operational existence and meet liabilities as they fall due at all
relevant testing dates. The subsequent analysis focused on applying the ‘reverse
stress test’ to the base case in order to demonstrate the conditions under which
a threat to business continuity could materialise and its impact.
The Group has also performed a detailed analysis to support the use of the going
concern basis in preparing its consolidated financial statements for the year ended
30 June 2024, covering an assessment period to 30 September 2025.
Going concern assessment process
Management prepared forecasts for the assessment period to provide a ‘base
case’ scenario, considered to reflect the most likely outcome based on detailed
analysis of current trading, expected future trends, and potential impact of known
risks. The results of this base case scenario modelling demonstrate adequate
resources to continue in operational existence and meet liabilities as they fall due
at all relevant testing dates. The subsequent analysis focused on applying ‘reverse
stress testing’ to the base case to demonstrate the conditions under which a threat
to business continuity could materialise.
All scenarios modelled in the stress testing exercise demonstrated that the
Group remains in a net cash position throughout the going concern period, and it
is therefore not considered plausible for the Group to be in a scenario where it was
unable to meet its liquidity needs. The review therefore focused on other potential
scenarios that would create a going concern risk. The reverse stress testing
exercise demonstrated that there would need to be a significant and sustained
drop in the Group’s profitability in combination with an associated demand
for cash, that will create a shift towards a net debt position. To determine the
likelihood of this scenario occurring, extreme downside assumptions were applied
and layered to the base case as follows:
•
cancellation of flagship events;
•
significant customer disruption causing material revenue loss; and
•
significant inflationary pressures and supply disruption with associated
material cost impact.
Notes to the financial statements
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1. Statement of accounting policies continued
a) Basis of preparation continued
Going concern assessment process continued
The application of these downside assumptions did not trigger a net debt scenario
at any relevant testing date. To gain further assurance over this conclusion, it has
however, considered a range of mitigative actions that could be applied to protect
the Group’s position as follows:
•
reduce controllable costs, for example discretionary reward, recruitment
freezes and travel restrictions;
•
optimise working capital by negotiating longer payment terms whilst
continuing to pay suppliers in full;
•
limit capital expenditure on new product development; and
•
implement strategic action in respect of the Group’s asset base.
Based on the assessment performed, together with the performance of the
Group to date in the financial year ending 30 June 2025, the Directors consider
that the Group has adequate resources to continue in operational existence and
meet its liabilities as they fall due over the going concern assessment period.
Accordingly the Directors have concluded that it was appropriate to adopt the
going concern basis in preparing the financial statements.
b) New standards and interpretations
There was no material impact from the adoption of new standards, interpretations
and amendments effective in the year ended 30 June 2024, including:
International Financial Reporting
Standards (IFRS/IAS)
Description
Effective for accounting
periods starting after
Amendments to IAS 12
Income Taxes
Deferred Tax related to
Assets and Liabilities
1 January 2023
Amendments to IAS 8 Accounting
Policies, Changes in Accounting
Estimates and Errors
Definition of
Accounting Estimates
1 January 2023
Amendments to IAS 1 Presentation
of Financial Statements and IFRS
Practice Statement 2
Disclosure of Accounting
Policies and Making
Materiality Judgements
1 January 2023
New standards and interpretations not yet effective
Standards, interpretations and amendments issued but not yet effective have
not been applied and are not expected to have a material impact on the Group’s
consolidated financial statements for the year ended 30 June 2025. The impact
of IFRS 18 Primary Financial Statements is under assessment and will become
effective in the financial year ending 30 June 2028, subject to UK endorsement.
c) Critical accounting judgments and estimates
The preparation of financial statements requires management to make judgments,
estimates and assumptions that affect the amounts reported for income and
expenses during the year and that affect the amounts reported for assets and
liabilities at the reporting date. At the 2024 annual reporting date there are
no critical accounting judgments or significant estimation uncertainties.
Accounting judgments and significant estimation uncertainties have been
considered in relation to climate change including the risks identified on
pages 59 to 61. Management considered any impact on forward looking
information and estimates such as those used in going concern and viability,
the carrying value of assets including goodwill, and the useful economic lives
of assets. No material impact has been identified. Management will continue to
regularly assess judgments and estimation uncertainties in relation to climate
change.
Goodwill and intangible assets
Management makes estimates in measuring the carrying amount of goodwill and
intangible assets. In considering whether goodwill and intangible assets have been
impaired, the recoverable amount of cash generating units has been determined
based on value in use calculations. These calculations require management to
estimate future cash flows, a long term growth rate and an appropriate discount
rate. The sensitivity of the carrying amount of goodwill to these variables
is considered in note 12.
Notes to the financial statements continued
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1. Statement of accounting policies continued
c) Critical accounting judgments and estimates continued
Acquisition accounting
Business combinations are accounted for under the acquisition method based
on the fair values of the consideration paid. Assets and liabilities are measured
at fair value at the acquisition date. The Group estimates the provisional fair
values and useful lives of acquired assets and liabilities at the date of acquisition.
The valuation of acquired intangibles is subject to estimation of future cash flows
and the discount rate applied to them. The valuation of the customer related
intangible assets is determined based on an excess earnings methodology, the
valuation of the marketing-related intangible asset is based on a royalty savings
method and the valuation of the technology-based intangible asset is based
on a replacement cost method.
Deferred consideration receivable
Amounts due are specified in the disposal agreements and are therefore not
estimated. The discount rates used to discount the deferred consideration
receivable to calculate the net present value are estimates. A discount rate of 14%
was used for the disposal of MiExact and 12% for the disposal of UK Healthcare,
this was based on management’s best estimate of the market interest rate that
reflects the specific risk of the loan note to the borrower. Consideration receivable
is initially recognised at fair value and subsequently measured at amortised cost.
If the discount rate increased/ decreased by 1 percentage point, the deferred
consideration balance for UK Healthcare would decrease by of £0.4m/increase
by £0.4m.
Tax
Management make judgments as to whether certain tax deductions claimed
will be allowable when tax authorities review tax filings. Some legislation is
hard to interpret and practical application of legislation will vary based on precise
circumstances. The Group has made claims based on tax advice from advisors
in each jurisdiction where it is required to file tax returns and the outcome of
these claims bears a degree of uncertainty until review periods are complete.
Significant adjustments to tax charges in future periods are therefore possible
depending on the outcome of tax authorities’ reviews.
Climate-related risks
In preparing the Group’s financial statements consideration has been given to the
impact of both physical and transition climate-related risks, as described in the
Task Force on Climate-Related Financial Disclosures ('TCFD') section on page 60.
Climate scenario analysis was used as a tool to identify and assess a potential
range of future outcomes, by capturing different assumptions about policies and
physical climate conditions.
There is inherent uncertainty over the assumptions used within these scenarios
and how they will impact the Group’s operations, cash flows and profitability.
The climate-related estimates and assumptions have been applied primarily to
going concern, impairment of non-financial assets, property plant and equipment,
indefinite life intangible assets and provisions.
d) Basis of consolidation
The Group’s consolidated financial statements incorporate the results and net
assets of Wilmington plc and all its subsidiary undertakings made up to 30 June
each year. Subsidiaries are all entities over which the Group has control. The Group
controls an entity when the Group is exposed to, or has rights to, variable returns
from its involvement with the entity and has the ability to affect those returns
through its power over the entity. Subsidiaries are fully consolidated from the date
on which control is transferred to the Group.
They are deconsolidated from the date that control ceases. Where necessary,
adjustments are made to the financial statements of subsidiaries to bring the
accounting policies used into line with those used by the Group. All inter-group
transactions, balances, income and expenses are eliminated on consolidation;
however, for the purposes of segmental reporting, internal arm’s length recharges
are included within the appropriate segments.
e) Business combinations
The acquisition method of accounting is applied in accounting for the acquisition
of subsidiaries. The acquiree’s identifiable assets and liabilities are recognised at
their fair value at the acquisition date. Goodwill arising on acquisition is recognised
as an asset and measured at cost, representing the excess of the aggregate of the
consideration, the amount of any non-controlling interests in the acquiree, and the
Notes to the financial statements continued
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1. Statement of accounting policies continued
e) Business combinations continued
fair value of the acquirer’s previously held equity interest in the acquiree (if any)
over the net of the fair values of the identifiable assets and liabilities at the date
of acquisition. The consideration is measured at fair value, which is the aggregate
of the fair values of the assets transferred, liabilities incurred or assumed and the
equity instruments issued in exchange for control of the acquiree.
f) Impairment of non-financial assets
Intangible assets with finite useful lives and property, plant and equipment are
tested for impairment if events or changes in circumstances indicate that the
carrying amount may not be recoverable. When an impairment test is performed,
the recoverable amount of the asset is assessed and its carrying amount is
reduced to that amount if lower, and any impairment losses are recognised in the
income statement. The recoverable amount is the higher of the value in use and
of the fair value less costs to sell, where the value in use is the present value of the
future cash flows expected to be derived from the asset.
If, in a subsequent period, the amount of the impairment loss decreases due to a
change in the estimates used to determine the asset’s recoverable amount since
the last impairment loss was recognised, the previously recognised impairment
loss is reversed to the extent that the carrying amount of the asset does not
exceed the carrying amount that would have been determined (net of amortisation
or depreciation) had no impairment loss been recognised for the asset in prior
years. The reversal of an impairment loss is recognised in the income statement.
Goodwill is not amortised, but it is reviewed for impairment at least annually.
Goodwill is allocated to cash generating units (‘CGUs’) for the purpose of
impairment testing, so that the value in use is determined by reference to the
discounted cash flows of the CGU. The cash flows considered are the expected
post-tax cash flows of the CGU, for projections over a three year period
extrapolated using estimated long term growth rates. The recoverable amount
of the CGU, as for any asset, is the higher of the value in use and the fair value
less costs to sell. If a CGU is impaired, the impairment losses are allocated firstly
against goodwill, and then on a pro-rata basis against intangible and other assets.
An impairment of goodwill is not reversed.
g) Foreign currencies
Items included in the financial statements of each of the Group’s entities are
measured using the currency of the primary economic environment in which the
entity operates (the ‘functional currency’). The consolidated financial statements
are presented in Sterling, which is the Company’s functional and the Group’s
presentation currency.
Foreign currency transactions are translated into the functional currency using the
exchange rates prevailing at the date of the transaction. Foreign exchange gains
and losses resulting from the settlement of transactions and the translation of
monetary assets and liabilities denominated in foreign currencies at period end
exchange rates are recognised in the income statement.
On consolidation, assets and liabilities of foreign undertakings are translated
into Sterling at year end exchange rates. The results of foreign undertakings
are translated into Sterling at average rates of exchange for the year (unless
this average is not a reasonable approximation of the cumulative effects of the
rates prevailing on the transaction dates, in which case income and expenses are
translated at the dates of the transactions). Foreign exchange differences arising
on retranslation are recognised directly in a separate component of equity, the
translation reserve.
In the event of the disposal of an undertaking with assets and liabilities
denominated in a foreign currency, the cumulative translation difference in the
translation reserve that is associated with the undertaking is charged or credited
to the gain or loss on disposal recognised in the income statement.
h) Revenue
Revenue is measured at the transaction price and represents amounts receivable
for goods and services provided in the normal course of business, net of discounts,
VAT and other sales related taxes.
Notes to the financial statements continued
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1. Statement of accounting policies continued
h) Revenue continued
The Group’s revenue comprises different types of product and services across the
Group as follows:
•
Subscription income for online services, information and journals is normally
received in advance and is therefore recorded as a contract liability on the
balance sheet. Revenue is then recognised evenly over time as the performance
obligations are satisfied over the term of the subscription. These revenue
streams relate to one performance obligation that is settled over time using the
output method on a straight line basis as the customer simultaneously receives
and consumes the benefit from the service.
•
Revenue is recognised on the sale of training material, research projects and
similar publications once the product has been delivered to the customer.
These revenue streams relate to one performance obligation that is settled
at a point in time as Wilmington has a right to payment once control of the
asset is transferred to the customer.
•
Advertising in hard copy publications is recognised on the issue of the related
publication. This revenue stream relates to one performance obligation that
is settled at a point in time as Wilmington has a right to payment once the
advertising is published in the hard copy publication.
•
Marketing and advertising services revenues are recognised over the period
of the advertising subscription or over the period when the marketing service
is provided. When payment is received in advance it is recorded on the
balance sheet as a contract liability and revenue is then recognised over time
as the performance obligations are satisfied over the term of the contract.
These revenue streams relate to one performance obligation that is settled
over time using the output method on a straight line basis as the customer
simultaneously receives and consumes the benefit from the service.
•
Revenue from the licence of static data reports is recognised once the data
has been delivered to the customer. This revenue stream relates to one
performance obligation that is settled at a point in time as Wilmington has
a right to payment once control of the asset is transferred to the customer.
•
Revenue from the licence of static data reports where the customer has access
to the data for a finite period of time and the reports have significant updates
during that period is recognised over the period of the contract. When payment
is received in advance it is recorded on the balance sheet as a contract liability
and revenue is then recognised over time as the performance obligations are
satisfied over the term of the contract. This revenue stream relates to one
performance obligation that is settled over time using the output method
on a straight line basis as the customer simultaneously receives and consumes
the benefit from the service.
•
Revenue from licences to dynamic data that is updated on an ongoing basis
is recognised over the period of the contract. When payment is received in
advance it is recorded on the balance sheet as a contract liability and revenue
is then recognised over time as the performance obligations are satisfied over
the term of the contract. This revenue stream relates to one performance
obligation that is settled over time using the output method on a straight line
basis as the customer simultaneously receives and consumes the benefit from
the service.
•
Revenue from classroom or online training courses where the training is
delivered as an ongoing process is recognised using the output method over
the period that the training is provided to the customer. When payment is
received in advance it is recorded on the balance sheet as a contract liability
and revenue is then recognised over time as the performance obligations are
satisfied over the term of the contract. This revenue stream relates to one
performance obligation that is settled over time using the output method
as the customer simultaneously receives and consumes the benefit from
the service.
•
Revenue from training courses where the Group provides in-house training
to corporate customers is recognised on completion of the training course.
This revenue stream relates to one performance obligation that is settled
at a point in time as Wilmington has a right to payment once the service has
been delivered to the customer.
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1. Statement of accounting policies continued
h) Revenue continued
•
Revenue from the memberships of professional organisations is recognised
on a straight line basis over the period of membership. When payment is
received in advance it is recorded on the balance sheet as a contract liability
and revenue is then recognised over time as the performance obligations are
satisfied over the term of the contract. This revenue stream relates to one
performance obligation that is settled over time using the output method on
a straight line basis as the customer simultaneously receives and consumes the
benefit from the service.
•
Revenue from consulting projects is recognised over time using the output
method on a performance completed to date method where there is an
enforceable right to payment for performance completed to date. This revenue
stream relates to one performance obligation that is settled over time using
the output method as the customer simultaneously receives and consumes the
benefit from the service.
•
Event revenue (including revenue from conferences) typically includes attendee
fees, event sponsorship and advertising and is recognised when the event
is held. Customers and sponsors are often required to pay in advance before
commencement of the event, and these advance receipts are recognised as
a contract liability on the balance sheet from the point at which they become
due. This revenue stream relates to one performance obligation that is settled
at a point in time as Wilmington has a right to payment once the service has
been delivered to the customer.
Contract liabilities represents consideration received for performance obligations
not yet satisfied, the revenue deferred at the current financial year end is expected
to be recognised in the following financial year.
i) Operating expenses
In accordance with IAS 1 paragraph 102, expenses are presented in the accounts
based on their nature. The nature of our operating expenses is that they split
into costs to fulfil revenue contracts and administrative costs and therefore
are shown in this split in the financial statements. Distribution costs are not
separately identified due to the digital nature of the Group’s products as they are
considered immaterial. Fulfilment costs are associated directly with the production
of a product, event or service and are charged to the income statement as incurred.
At each reporting date a prepayment is recognised for any third-party costs
which are paid for in advance of the relevant event being run except in relation
to marketing costs. Administrative costs are additional operational costs that are
not directly associated with the production of a product, event or service. These
include expenses relating to central administrative and management functions and
are expensed to the income statement as incurred. Material items within operating
expenses are disclosed in the financial statements and include staff costs,
depreciation and amortisation and fulfilment costs.
j) Segmental reporting
Operating segments are reported in a manner consistent with the internal
reporting provided to the Executive Board of Directors (the ‘Board’) which is
considered as the Group’s chief operating decision maker and is responsible
for allocating resources and assessing performance of the operating segments.
The three divisions (HSE, Legal and Financial Services) are the Group’s segments
and generate all of the Group’s ongoing revenue. The Board considers the business
from both a geographic and product perspective. Geographically, management
considers the performance of the Group between the UK, Europe (excluding the
UK), USA and the Rest of the World.
k) Adjusting items
The Group’s income statement separately identifies adjusting items. Such items are
those that in the Directors’ judgment are one off in nature and need to be disclosed
separately by virtue of their size and incidence. In determining whether an item
or transaction should be classified as an adjusting item, the Directors consider
quantitative as well as qualitative factors such as the frequency, predictability
of occurrence and significance.
This focus on quantitative and qualitative factors may result in the classification
of an item as adjusting, where one of apparently similar nature is not. The Group
distinguishes between restructuring costs that are recurring and those that relate
to one off or transformational Group programmes that impact many operations.
Recurring restructuring costs that are incurred in the normal course of business are
recorded as part of the Group’s underlying trading results within profit before tax.
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1. Statement of accounting policies continued
k) Adjusting items continued
Restructuring costs that are one off and individually material or relate to
programmes linked to the Group’s wider transformation and require approval
at executive level are disclosed separately in the Consolidated income statement.
When these adjusting items relate to a transformational programme to the
business, the cost may apply to multiple years.
This is consistent with the way that financial performance is measured by
management and reported to the Board. Adjusting items may not be comparable
to similarly titled measures used by other companies. Disclosing adjusted items
separately provides additional understanding of the performance of the Group.
l) Current and deferred tax
Current and deferred tax is recognised as income or an expense and included in
the income statement for the period, except to the extent that it relates to items
recognised directly in other comprehensive income or directly in equity, in which
case it is recognised in other comprehensive income or equity, respectively.
The tax effect of adjusting items is calculated by applying the relevant prevailing
rate of taxation to the adjusting expense or income to the extent it is taxable
or tax deductible.
The current tax charge is calculated on the basis of the tax laws enacted or
substantively enacted at the balance sheet date in the countries where the
Company’s subsidiaries operate and generate taxable income. Management
periodically evaluates positions taken in tax returns with respect to situations
in which applicable tax regulation is subject to interpretation. It establishes
provisions where appropriate on the basis of amounts expected to be paid to the
tax authorities.
Deferred tax is recognised, using the liability method, on temporary differences
arising between the tax bases of assets and liabilities and their carrying
amounts in the consolidated financial statements. However, the deferred tax
is not accounted for if it arises from initial recognition of an asset or liability in a
transaction other than a business combination that at the time of the transaction
affects neither accounting nor taxable profit nor loss. Deferred tax is determined
using tax rates (and laws) that have been enacted or substantively enacted by the
balance sheet date and are expected to apply when the related deferred tax asset
is realised or the deferred tax liability is settled.
Deferred tax assets are recognised only to the extent that it is probable that
future taxable profit will be available against which the temporary differences can
be utilised.
Deferred tax assets and liabilities are offset when there is a legally enforceable
right to offset current tax assets against current tax liabilities and when the
deferred taxes assets and liabilities relate to income taxes levied by the same
taxation authority on either the same taxable entity or different taxable entities
where there is an intention to settle the balances on a net basis.
m) Dividends
Dividend distributions are recognised in the consolidated financial statements
when the shareholders’ right to receive payment is established. Final dividend
distributions are recognised in the period in which they are approved by the
shareholders, whilst interim dividend distributions are recognised in the period
in which they are declared and paid.
n) Intangible assets
Intangible assets are stated at historical cost less accumulated amortisation.
Intangible assets are recorded at cost and are amortised through the income
statement on a straight line basis over their estimated useful lives. Their estimated
useful lives depend on the classification of the assets as follows:
Computer software
20–33% per annum
Databases
8–20% per annum
Customer relationships
8–33% per annum
Brands
5–20% per annum
Publishing rights and titles
5–10% per annum
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1. Statement of accounting policies continued
n) Intangible assets continued
Computer software that is integral to a related item of hardware is classified
as computer equipment within property, plant and equipment. Other computer
software and internally developed software and databases are classified as
intangible assets if they meet the definition and recognition criteria set out in I
AS 38. Costs associated with the production of internally developed software are
capitalised once it is probable that they will generate future economic benefits
and satisfy the other criteria set out in IAS 38. Computer software intangible
assets (including the cost of internally developed software and databases) are
initially recognised at cost. They are subsequently amortised through the income
statement on a straight line basis over their estimated useful lives up to five
years. Assets that are not in use at the reporting date (assets under development)
are recognised at cost and amortisation commences when those assets begin
to generate economic benefit. Research costs are expensed as incurred.
o) Property, plant and equipment
Property, plant and equipment is stated at historical cost less accumulated
depreciation. Cost includes the original purchase price of the asset plus any costs
of bringing the asset to its working condition for its intended use. Depreciation
is not provided on freehold land. On other assets it is provided at the following
annual rates, on a straight line basis, in order to write down each asset to its
residual value over its estimated useful life. The assets’ residual values and useful
lives are reviewed, and adjusted if appropriate, at the end of each reporting period.
Land, freehold and leasehold buildings
(excluding freehold land)
2–10% per annum
Fixtures and fittings
10–33% per annum
Computer equipment
25–33% per annum
Motor vehicles
25% per annum
Leasehold improvements are included in land, freehold and leasehold buildings.
Gains and losses arising on disposal are determined by comparing the proceeds
with the carrying amount and are recognised within the income statement.
When the gain or loss arising on disposal is significant or material, it is disclosed
separately on the income statement within other income or expenses.
p) Investments in subsidiaries
Investments in subsidiaries are stated at cost less provision for any impairment
in value.
q) Non-current assets and disposal groups held for sale
Non-current assets (or disposal groups) are classified as held for sale when their
carrying amount is to be recovered principally through a sale transaction and a sale
is considered highly probable. They are stated at the lower of carrying amount and
fair value less costs to sell.
r) Financial instruments
Financial assets
The Group classifies its non-derivative financial assets as ‘amortised cost’ for the
purposes of IFRS 9. Management determines the classification at initial recognition
and re-evaluates this designation at each reporting date.
Loans and other receivables
Loans and other receivables are measured based on the Group’s business model
for managing the financial asset and its contractual cash flow characteristics.
Loans and other receivables are initially recognised at fair value plus transaction
costs. They are subsequently carried at amortised cost using the effective interest
method less any expected credit losses, with changes in carrying value recognised
in the income statement.
Loans and other receivables are classified as current assets if they mature
within twelve months of the reporting date, but are otherwise classified as
non‑current assets.
Trade receivables
Trade receivables are initially recognised at the transaction price, which is usually
the invoiced amount. They are subsequently carried at amortised cost using the
effective interest method (if the time value of money is significant), less provision
for expected credit losses. Provisions are made specifically, where there is evidence
of a risk of non-payment taking into account ageing, previous losses experienced
and general economic conditions.
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1. Statement of accounting policies continued
r) Financial instruments continued
Trade receivables continued
The Group assesses for impairment using the expected credit losses model
as required by IFRS 9. For trade receivables, the Group applies the simplified
approach which requires expected lifetime losses to be recognised from the initial
recognition of the receivables.
The Group measures its trade receivables at amortised cost for the purposes of
IFRS 9 and are presented as current assets as all collections are due in one year
or less.
Cash and cash equivalents
Cash and cash equivalents comprise cash in hand, current balances with banks
and similar institutions, and other short term highly liquid investments which are
subject to insignificant risk of changes in value and have original maturities of
three months or less. Cash and cash equivalents are offset against bank overdrafts
and the net amount is reported in the balance sheet when there is a legally
enforceable right to offset the recognised amounts. Bank overdrafts are otherwise
shown as borrowings within current liabilities on the balance sheet. There were no
overdrafts used for the year ended 30 June 2024 or the year ended 30 June 2023.
The Group measures cash and cash equivalents at amortised cost for the purposes
of IFRS 9.
Impairment of financial assets
The Group assesses on a forward-looking basis the expected credit losses
associated with its financial assets carried at amortised cost and debt instruments
at fair value through other comprehensive income. Expected credit losses are
updated at each reporting date to reflect changes in credit risk.
The expected credit loss is based on the Group’s historical credit loss experience,
adjusted for factors that are specific to the financial assets, general economic
conditions and an assessment of the current and forecast conditions at the
reporting date.
Financial liabilities
Trade and other payables
Trade and other payables are initially recognised at fair value, which is usually
the invoiced amount. They are subsequently carried at amortised cost using the
effective interest method (if the time value of money is significant).
If due within twelve months or less, the trade or other payable is classified
as a current liability. It is otherwise classified as a non-current liability.
The Group measures trade and other payables at amortised cost for the purposes
of IFRS 9.
Loans and other borrowings
Loans and other borrowings are initially recognised at the fair value of the amounts
received net of transaction costs. They are subsequently carried at amortised cost
using the effective interest method, with changes in carrying value recognised in
the income statement.
Loans and other borrowings are classified as current liabilities if they mature
within twelve months of the balance sheet date, but are otherwise classified
as non-current liabilities.
The Group measures loans and other borrowings at amortised cost for the
purposes of IFRS 9.
Financial instruments and hedge accounting
The Group manages its capital and makes adjustments to it in light of changes
in economic conditions and the risk characteristics of the underlying assets.
The Group makes use of derivative financial instruments if doing so reduces
exposure to interest rate risk and foreign currency risk. There were no derivative
financial instruments used in the Group for the year ended 30 June 2024 or the
year ended 30 June 2023.
s) Provisions
Provisions are recognised in the balance sheet when the Group has a present legal
or constructive obligation as a result of a past event, and it is probable that an
outflow of economic benefits will be required to settle it. If the effect is material,
provisions are determined by discounting the expected future cash flows at an
appropriate discount rate.
Notes to the financial statements continued
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1. Statement of accounting policies continued
t) Retirement benefits
The Group does not operate a defined benefit pension scheme.
The Group contributes to defined contribution pension schemes for a number
of employees. Contributions to these arrangements are charged in the income
statement in the period in which they are incurred. The Group has no further
payment obligation once the contributions have been paid.
u) Share based payments
The Group operates an equity-settled, share based compensation plan, under
which the entity receives services from employees as consideration for equity
instruments (share awards and options) of the Group. The fair value of the
employee services received in exchange for the grant of share awards and options
is recognised as an expense. The total amount to be expensed is determined by
reference to the fair value of the share awards and options granted, excluding the
impact of any non‑market service and performance vesting conditions (for example
profitability and remaining as an employee of the entity over a specified time
period). Non-market vesting conditions are included in assumptions about
the number of share awards and options that are expected to vest. The total
amount expensed is recognised over the vesting period, which is the period over
which all of the specified existing conditions are to be satisfied. At each balance
sheet date, the entity revises its estimates of the number of share awards and
options that are expected to vest based on the non-market vesting conditions.
It recognises the impact of the revision to original estimates, if any, in the income
statement, with a corresponding adjustment to the share based payments reserve
within equity.
The payment in lieu of dividend payable in connection with the grant of the
share awards is considered an integral part of the grant itself, and the charge
will be treated as an equity-settled transaction. The cumulative share based
payment charge held in reserves is recycled into retained earnings when the
share awards or options lapse or are exercised. The social security contributions
payable in connection with the grant of the share awards will be treated
as a cash‑settled transaction.
v) Leases
The Group recognises a right-of-use asset and corresponding liability at the date
the leased asset is made available for use by the Group.
The liability is measured at the present value of future lease payments over the
lease term including fixed payments, in-substance fixed payments, and variable
lease payments that are based on an index or a rate, less any lease incentives
receivable. Lease liabilities are remeasured to include any payments to be made
under extension options which are reasonably certain to be exercised. The lease
payments are discounted using the interest rate implicit in the lease; where this
rate cannot be determined an incremental borrowing rate is used. The incremental
borrowing rate is determined with reference to the rate that the lessee would
pay to borrow the funds necessary to obtain an asset of similar value, in a
similar economic environment, with similar terms and conditions, adjusted for
the country‑specific risk of the lessee. The Group records an interest charge
in respect of the lease liability over the lease term.
The right-of-use asset is measured at cost, based on the value of the initial
measurement of the associated lease liability, adjusted for any lease payments
already made less any lease incentives received, initial direct costs incurred, and
any dilapidation or restoration costs required by the terms and conditions of the
lease. The right-of-use asset is depreciated over the term of the lease on a straight
line basis, or if shorter, over the leased asset’s useful economic life.
Lease liabilities are remeasured when there is a change in future lease payments
arising from a change in an index or rate, a change in the estimate of the amount
expected to be payable under a residual value guarantee, or as appropriate,
changes in the assessment of whether a purchase or extension option is
reasonably certain to be exercised.
The Group recognises an expense in the Consolidated income statement in respect
of short term leases (being those with an initial term of twelve months or less) and
leases of low-value items on a straight line basis over the life of the lease.
w) Share capital
Ordinary shares are classified as equity. Incremental costs directly attributable
to the issue of new shares or options are shown in equity as a deduction, net of
tax, from the proceeds. The share premium reserve represents the amount paid
to the Company by shareholders above the nominal value of shares issued.
Notes to the financial statements continued
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1. Statement of accounting policies continued
w) Share capital continued
Where any Group company purchases the Company’s equity share capital
(‘treasury shares’), the consideration paid, including any directly attributable
incremental costs (net of income taxes), is deducted from equity attributable
to the Company’s equity holders until the shares are cancelled or reissued.
2. Measures of profit
Reconciliation to profit on continuing activities before tax
To provide shareholders with additional understanding of the trading performance
of the Group, adjusted EBITA has been calculated as profit before tax after
adding back:
•
impairment of goodwill;
•
amortisation of intangible assets excluding computer software;
•
adjusting items (included in operating expenses);
•
other income – gain on disposal of subsidiaries;
•
other income – gain on disposal of property, plant and equipment and lease
modification; and
•
net finance income.
Adjusted profit before tax, adjusted EBITA and adjusted EBITDA reconcile to profit
on continuing activities before tax as follows:
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Profit before tax
24,208
20,492
Impairment of goodwill
4,434
—
Amortisation of intangible assets excluding computer software
2,090
1,078
Adjusting items (included in operating expenses)
598
147
Other income – gain on disposal of subsidiaries
(5,465)
(2,212)
Other income – gain on disposal of property, plant and
equipment and lease modification
(2,189)
—
Adjusted profit before tax
23,676
19,505
Net finance income
(1,997)
(232)
Adjusted operating profit (‘adjusted EBITA’)
21,679
19,273
Depreciation of property, plant and equipment included in
operating expenses
1,711
2,121
Amortisation of intangible assets – computer software
1,004
1,525
Adjusted EBITA before depreciation (‘adjusted EBITDA’)
24,394
22,919
Adjusted EBITA
21,679
19,273
Add EBITA from statutory discontinued operations
3,874
4,833
Total Group adjusted EBITA
25,553
24,106
Adjusted profit before tax
23,676
19,505
Add adjusted profit before tax from statutory
discontinued operations
3,874
4,833
Total Group adjusted profit before tax
27,550
24,338
Remove operating profit from sold and closed businesses
(3,484)
(7,410)
Ongoing adjusted profit before tax
24,066
16,928
Notes to the financial statements continued
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3. Segmental information
In accordance with IFRS 8 the Group’s operating segments are based on the
operating results reviewed by the Executive Board, which represents the chief
operating decision maker.
During the year, the Group reorganised its business into three Divisions (HSE,
Legal and Financial Services) to compliment the changes to the Group structure
as a result of the significant disposals and the acquisition, the segments give
greater focus to the customer base. These reportable segments reflect the internal
reporting provided to the Chief Operating Decision Maker (the Executive Board)
on a regular basis to assist in making decisions and to assess performance.
Segment information has been restated in the prior period to align to the current
reportable segments.
The Group’s dynamic portfolio provides customers with a range of information,
data, training and education solutions. The Board considers the business from both
a geographic and product perspective. Geographically, management considers the
performance of the Group between the UK, Europe (excluding the UK), the USA
and the Rest of the World.
a) Business segments
Revenue
Year ended
30 June 2024
£’000
Profit/(loss)
Year ended
30 June 2024
£’000
Revenue
Year ended
30 June 2023
£’000
Profit
Year ended
30 June 2023
£’000
HSE
4,837
1,201
—
—
Legal
15,986
6,173
14,014
6,014
Financial Services
68,850
20,726
64,717
15,900
Ongoing
89,673
28,100
78,731
21,914
Non-core
8,651
(390)
14,334
2,577
Group total
98,324
27,710
93,065
24,491
Unallocated central overheads
—
(4,166)
—
(3,703)
Share based payments
—
(1,865)
—
(1,515)
98,324
21,679
93,065
19,273
Impairment of goodwill
(4,434)
—
Amortisation of intangible assets
excluding computer software
(2,090)
(1,078)
Adjusting items (included
in operating expenses)
(598)
(147)
Other income – gain on disposal
of subsidiaries
5,465
2,212
Other income – gain on disposal
of property, plant and equipment
and lease modification
2,189
—
Net finance income
1,997
232
Profit before tax from
continuing operations
24,208
20,492
Taxation
(7,009)
(3,317)
Profit for the financial year from
continuing operations
17,199
17,175
There are no intra-segmental revenues which are material for disclosure.
Unallocated central overheads represent central costs that are not specifically
allocated to segments. Total assets and liabilities for each reportable segment are
not presented; as such information is not provided to the Board.
Notes to the financial statements continued
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3. Segmental information continued
b) Segmental information by geography
The UK is the Group’s country of domicile and the Group generates the majority
of its revenue from external customers in the UK. The geographical analysis of
revenue is on the basis of the country of origin in which the customer is invoiced:
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
UK
52,353
49,441
USA
25,761
24,050
Europe (excluding the UK)
10,777
10,481
Rest of the World
9,433
9,093
Revenue from continuing operations
98,324
93,065
c) Timing of revenue recognition
The timing of the Group’s revenue recognition is as follows:
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Revenue from products and services transferred
at a point in time
60,322
55,223
Revenue from products and services transferred over time
38,002
37,842
Revenue from continuing operations
98,324
93,065
During the year the Group recognised £33,659,000 of revenue that was held
as a contract liability at 30 June 2023 (2023: £31,405,000 related to amounts held
at 30 June 2022).
4. Profit from continuing operations
a) Profit for the year from continuing operations is stated
after charging/(crediting):
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Depreciation of property, plant and equipment – included in
operating expenses
1,711
2,121
Short-term and low-value leases
143
94
Amortisation of intangible assets – computer software
1,004
1,525
Non-adjusting profit on disposal of property, plant and
equipment
—
(36)
Share based payments (including social security costs)
1,865
1,515
Amortisation of intangible assets excluding computer
software
2,090
1,078
Adjusting items (included in operating expenses)
598
147
Adjusting item – gain on disposal of subsidiaries
(5,465)
(2,212)
Adjusting item – gain on sale of property, plant and
equipment and lease modification
(2,189)
—
Research and development expenditure credit
—
(200)
Impairment of goodwill
4,434
—
Foreign exchange loss
87
179
Fees payable to the auditor for the audit of the Company
and consolidated financial statements
249
153
Fees payable to the auditor and their associates for
other services:
– The audit of the Company’s subsidiaries pursuant
to legislation
251
240
– Audit related other services
18
17
Notes to the financial statements continued
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4. Profit from continuing operations continued
a) Profit for the year from continuing operations is stated
after charging/(crediting): continued
The gain on property, plant and equipment and lease modification relates to the
sale of a building realising a gain of £0.9m, and an early exit of the head office
lease releasing a gain of £1.3m. The gain on exit of the head office contains a lease
modification. The right-of use asset was reduced by £1.0m and the lease liability
was reduced by £2.8m, property, plant and equipment were impaired by £0.4m,
a provision was unwound of £0.8m, and professional fees and a lease surrender
expense of £0.9m were recognised.
Further information can be found in note 22.
b) Adjusting items
The following items have been charged to the income statement during the year
but are considered to be adjusting so are shown separately:
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Expense relating to strategic activities
598
147
Other adjusting items (included in operating expenses)
598
147
Impairment of goodwill
4,434
—
Amortisation of intangible assets excluding computer software
2,090
1,078
Total adjusting items (classified in profit before tax)
7,122
1,225
During the year, the Compliance Week CGU was impaired. Please see note 12 for
further information. Expenses related to strategic activities represent acquisition
costs of £0.6m.
Notes to the financial statements continued
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144
5. Operating expenses from continuing operations
Year ended 30 June 2024
Year ended 30 June 2023
Fulfilment costs
£’000
Administration
£’000
Total
£’000
Fulfilment costs
£’000
Administration
£’000
Total
£’000
Operating expenses before depreciation and amortisation
69,050
4,880
73,930
65,516
4,630
70,146
Depreciation of property, plant and equipment
1,711
—
1,711
2,121
—
2,121
Amortisation of intangible assets – computer software
1,004
—
1,004
1,525
—
1,525
Operating expenses before amortisation of intangibles excluding computer software,
impairment and adjusting items
71,765
4,880
76,645
69,162
4,630
73,792
Amortisation of intangible assets – databases
117
—
117
71
—
71
Amortisation of intangible assets – customer relationships
1,188
—
1,188
611
—
611
Amortisation of intangible assets – brands
493
—
493
190
—
190
Amortisation of intangible assets – publishing rights and titles
292
—
292
206
—
206
Impairment of goodwill (note 4b)
4,434
—
4,434
—
—
—
Other adjusting items (note 4b)
598
—
598
—
147
147
Operating expenses
78,887
4,880
83,767
70,240
4,777
75,017
6. Finance income and expense
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Interest receivable on cash and cash equivalents
1,953
373
Unwinding of the discount on royalty payments receivable
219
105
Finance income
2,172
478
Interest expense for lease liabilities
(175)
(246)
Finance expense
(175)
(246)
Net finance income
1,997
232
7. Taxation
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Current tax
UK corporation tax at current rates on UK profits for the year
5,009
3,096
Adjustments in respect of previous years
394
(54)
5,403
3,042
Foreign tax
1,568
1,291
Adjustments in respect of previous years
(19)
89
Total current tax
6,952
4,422
Total deferred tax
57
(1,105)
Taxation from continuing operations
7,009
3,317
Notes to the financial statements continued
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145
7. Taxation continued
Factors affecting the tax charge for the year:
The effective tax rate is higher (2023: lower) than the average rate of corporation
tax in the UK of 25.0% (2023: 20.5%). The differences are explained below:
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Profit before tax
24,208
20,492
Profit before tax multiplied by the average rate of corporation
tax in the year of 25.0% (2023: 20.5%)
6,052
4,200
Tax effects of:
Impairment of goodwill
1,109
—
Gain on disposal of subsidiaries
(1,367)
(453)
Foreign tax rate differences
156
178
Adjustment in respect of previous years
379
35
Other items not subject to tax
623
462
Deferred tax UK intangibles and capital allowances movement
(88)
(904)
Effect on deferred tax of a change in the corporation tax rate
408
(83)
Other deferred tax movements
(263)
(118)
Taxation from continuing operations
7,009
3,317
Deferred tax assets and liabilities are measured at the rates that are expected
to apply in the periods of the reversal.
The Company’s profits for this accounting year are taxed at an effective rate
of 29.4% (2023: 16.2%).
The tax effect of adjusting items as disclosed in note 9 is an expense of £571,000
(2023: credit of £1,598,000).
8. Dividends
Amounts recognised as distributions to owners of the parent in the year:
Year ended
30 June 2024
Pence
per share
Year ended
30 June 2023
Pence
per share
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Final dividends recognised as
distributions in the year
7.3
5.8
6,473
5,091
Interim dividends recognised
as distributions in the year
3.0
2.7
2,680
2,371
Total dividends paid
9,153
7,462
Final dividend proposed
8.3
7.3
7,297
6,410
9. Earnings per share
Adjusted earnings per share has been calculated using adjusted earnings
calculated as profit after taxation but before:
•
impairment of goodwill;
•
amortisation of intangible assets excluding computer software;
•
adjusting items (included in operating expenses);
•
other income – gain on disposal of subsidiaries; and
•
other income – gain on disposal of property, plant and equipment and
lease modification.
Notes to the financial statements continued
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146
9. Earnings per share continued
The calculation of the basic and diluted earnings per share is based on the following data:
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Continuing operations:
Earnings from continuing operations for the purpose
of basic earnings per share
17,199
17,175
Add/(remove):
Impairment of goodwill
4,434
—
Amortisation of intangible assets excluding computer software
2,090
1,078
Adjusting items (included in operating expenses)
598
147
Other income – gain on disposal of subsidiaries
(5,465)
(2,212)
Other income – gain on disposal of property, plant and
equipment and lease modification
(2,189)
—
Tax effect of adjustments above and deferred tax
571
(1,598)
Adjusted earnings for the purposes of adjusted
earnings per share
17,238
14,590
Continuing and discontinued operations:
Earnings from total operations for the purpose of basic
earnings per share
41,210
20,195
Add/(remove):
Impairment of goodwill
4,434
—
Amortisation of intangible assets excluding computer software
2,637
2,381
Adjusting items (included in operating expenses)
598
147
Other income – gain on disposal of subsidiaries
(26,831)
(2,212)
Other income – gain on disposal of property, plant and
equipment and lease modification
(2,189)
—
Tax effect of adjustments above and deferred tax
571
(1,598)
Adjusted earnings for the purposes of adjusted
earnings per share
20,430
18,913
2024 Number
2023 Number
Continuing operations:
Weighted average number of ordinary shares for the purposes
of basic and adjusted earnings per share
88,964,817
88,027,119
Effect of dilutive potential ordinary shares:
Future exercise of share awards and options
1,722,761
2,217,174
Weighted average number of ordinary shares for the
purposes of diluted and adjusted diluted earnings per share
90,687,578
90,244,293
Continuing and discontinued operations:
Weighted average number of ordinary shares for the purposes
of basic and adjusted earnings per share
88,964,817
88,027,119
Effect of dilutive potential ordinary shares:
Future exercise of share awards and options
1,722,761
2,217,174
Weighted average number of ordinary shares for the
purposes of diluted and adjusted diluted earnings per share
90,687,578
90,244,293
Continuing operations:
Basic earnings per share
19.33p
19.51p
Diluted earnings per share
18.96p
19.03p
Adjusted basic earnings per share (‘adjusted earnings per share’)
19.38p
16.57p
Adjusted diluted earnings per share
19.01p
16.17p
Continuing and discontinued operations:
Basic earnings per share
46.32p
22.94p
Diluted earnings per share
45.44p
22.38p
Adjusted basic earnings per share (‘adjusted earnings per share’)
22.96p
21.49p
Adjusted diluted earnings per share
22.53p
20.96p
Notes to the financial statements continued
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147
10. Acquisition of Astutis
On 23 November 2023, the Group acquired 100% of the issued share capital of
Astutis Limited ("Astutis"), a Company based in the United Kingdom, for an initial
consideration of £16.8m. In addition, under the terms of the acquisition, there
are two potential deferred payments totalling up to £4.7m based on Astutis'
performance in each of the two years ending 30 June 2025 and 30 June 2026.
As the deferred payments are linked to employment, they will be recognised
as a separate transaction in each period respectively as they fall due.
Astutis, which offers training for a range of globally recognised and regulated
health, safety and environmental qualifications, strengthens Wilmington's portfolio
of GRC training and education solutions by expanding its capabilities into the
health, safety and environmental markets. The acquisition is part of Wilmington's
strategy to focus on consolidating its already strong presence in the large, growing
and rapidly evolving GRC markets. These markets are underpinned by strong
macro drivers, particularly the increasing volume and enforcement of regulation,
complex geopolitical landscape, increased importance of ESG and widespread
adoption of technological and data-driven compliance solutions. Goodwill acquired
relates to synergies and access to the health, safety and environmental markets.
The fair value of the net assets acquired in the business at acquisition date was
£9.0m, resulting in goodwill on acquisition of £11.2m. Acquisition related charges
include transaction costs of £0.6m relating to the acquisition of Astutis. The results
of the acquisition included in the Group’s consolidated results are revenue of
£4.8m and an operating result of £1.2m. Due to limitations in available data for the
pre-acquisition period, the Directors consider that it is impracticable to disclose the
results of the combined entity as though the acquisition had impacted the Group’s
consolidated results for the full year. The goodwill recognised is not deductible for
tax purposes.
A summary of the acquisition is detailed below:
£’000
Fair value of net assets acquired
Intangibles
9,861
Property, plant and equipment
336
Trade and other receivables
1,880
Cash and cash equivalents
4,207
Trade and other payables
(4,510)
Current tax liability
(494)
Deferred tax liability
(1,995)
Lease liability
(311)
Net assets acquired
8,974
Goodwill
11,156
Final working capital adjustments
(1,174)
Total cash consideration
18,956
Final working capital adjustments paid in cash
1,174
Cash acquired
(4,207)
Total cash outflow
15,923
Notes to the financial statements continued
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Wilmington plc Annual Report and Financial Statements 2024
148
11. Disposals, disposal group held for sale
and discontinued operations
Disposal of MiExact
On 31 January 2024 the Group disposed of its mortality data business,
MiExact Limited, for consideration of £9.6m prior to working capital adjustments
and recognised a gain on disposal of £5.9m presented within other income.
Wilmington received cash of £6.9m on completion after working capital
adjustments, and the remaining £3.0m was issued as a loan note with a 7%
coupon, deferred for up to three years.
The disposal was executed by way of the sale of 100% of the equity shares.
Net assets on disposal were £2.9m, a breakdown can be found in the table on the
following page.
MiExact has not been classified as a discontinued operation under IFRS 5 because
it does not meet the IFRS 5 criteria as a significant line of business.
Disposal of APM (part of the European Healthcare business)
On 26 April 2024 the Group disposed of its French Healthcare business, APM, for
consideration of €26.0m (£22.3m) in cash, prior to working capital adjustments and
recognised a gain on disposal of €23.3m (£19.9m) presented within discontinued
operations.
The disposal was executed by way of the sale of 100% of the equity shares.
Net assets on disposal were £1.9m, a breakdown can be found in the table on
the following page.
The European Healthcare business, consisting of APM and UK Healthcare,
has been classified as a discontinued operation under IFRS 5 because it meets the
IFRS 5 criteria as a significant line of business.
Disposal of UK Healthcare (part of the European
Healthcare business)
On 27 June 2024 the Group disposed of its UK Healthcare business for
consideration of up to £26.3m. The UK Healthcare business includes the
entire issued share capital of Wilmington Healthcare Limited and Interactive
Medica SL. This transaction completes Wilmington's sale of its European
Healthcare businesses, following the disposal of the Group's French Healthcare
business, APM, announced on 26 April 2024 for €26m.
The initial consideration of £21.3m comprises £4.8m in cash with the balance
of £16.5m satisfied through the issue by the purchaser of secured loan notes
for a term of up to four years, carrying a variable interest rate equal to the
Bank of England base rate with some principal repayments throughout the term.
The transaction realised a gain on disposal of £1.5m presented within
discontinued operations.
The total consideration of £21.3m will increase by up to approximately £5.1m,
subject to the UK Healthcare business achieving certain EBITDA targets for the
financial year ending 30 June 2025. This contingent consideration has not been
recognised as part of consideration because of the assessed likelihood of meeting
the specified targets.
The disposal was executed by way of the sale of 100% of the equity shares.
Net assets on disposal were £15.2m, a breakdown can be found in the table on
the following page.
The European Healthcare business, consisting of APM and UK Healthcare, has
been classified as a discontinued operation under IFRS 5 because it meets the IFRS
5 criteria as a significant line of business. Please see below for further information.
Revision of ICP
The disposal proceeds for the 2018 disposal of ICP were renegotiated to ensure
payment would actually be received, resulting in a reduction in the profit on
disposal of £414,000 presented within other income.
Notes to the financial statements continued
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149
11. Disposals, disposal group held for sale
and discontinued operations continued
Net assets as at the disposal dates:
The disposals were executed by way of the sale of 100% of the equity shares and as at each disposal date, the net assets were as follows:
MiExact
£’000
APM
£’000
UK Healthcare
£’000
ICP
£’000
Total
£’000
Goodwill
2,391
—
11,885
Intangibles
—
89
1,734
Property, plant and equipment
13
1,435
3
Deferred tax asset
—
—
33
Current tax asset
—
392
95
Trade and other receivables
898
2,195
5,114
Cash and cash equivalents
1,038
4,141
2,942
Trade and other payables
(1,414)
(5,017)
(6,654)
Lease liabilities
—
(1,300)
—
Net assets disposed
2,926
1,935
15,152
20,013
Directly attributable costs of disposal
638
1,104
1,618
3,360
Recycling of foreign exchange (gain)/loss
—
25
(262)
(237)
Gain on disposal included within discontinued operations
—
19,912
1,454
21,366
Gain/(loss) on disposal included within other income
5,879
—
—
(414)
5,465
Fair value of consideration during the year
9,443
22,976
17,962
(414)
49,967
Satisfied by:
Cash and cash equivalents
6,894
22,976
4,812
34,682
Fair value of deferred consideration
2,549
—
13,150
(414)
15,285
9,443
22,976
17,962
(414)
49,967
Cash received
6,894
22,976
4,812
34,682
Less cash disposed
(1,038)
(4,141)
(2,942)
(8,121)
Total cash inflow
5,856
18,835
1,870
26,561
The disposals reflect the Group’s continued and active management of its portfolio to assess the potential of each business to exhibit the six common Wilmington
characteristics that we recognise as key drivers of organic revenue growth and profitability improvement.
Notes to the financial statements continued
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Wilmington plc Annual Report and Financial Statements 2024
150
11. Disposals, disposal group held for sale
and discontinued operations continued
European Healthcare business (UK Healthcare & APM)
classified as a discontinued operation
The European Healthcare business (consisting of APM and UK Healthcare) has
been classified as a discontinued operation in the year with the financial results,
including the comparatives, presented separately. The operation meets the IFRS
5 definition as a discontinued operation due to it being a separate major line of
business and part of single coordinated disposal plan.
The table below shows the results of the discontinued operation, which is included
separately in the Consolidated Income Statement.
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
European Healthcare
Revenue
27,679
30,432
Operating expenses before amortisation of intangibles
excluding computer software
(23,805)
(25,599)
Amortisation of intangible assets excluding
computer software
(547)
(1,303)
Operating expenses
(24,352)
(26,902)
Operating profit
3,327
3,530
Profit before tax
3,327
3,530
Taxation
(682)
(510)
Profit after tax
2,645
3,020
Gain on disposal
21,366
—
Profit after tax from discontinued operations
24,011
3,020
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
European Healthcare
Net cash generated from operating activities
208
4,070
Net cash used in investing activities
20,574
(164)
Net cash used in financing activities
(151)
(176)
Net increase in cash & cash equivalents
20,631
3,730
Compliance Week classified as a disposal group held for sale
During the year, the Compliance Week businesses, has been classified
as a disposal group held for sale under IFRS 5.
The Group is focused on actively managing our portfolio by assessing the potential
of each business to exhibit the six common Wilmington characteristics that we
recognise as key drivers of organic revenue growth and profitability improvement.
Consequently, as a result of this assessment, the Board decided to exit the
Compliance Week business. The disposal is expected to be completed within
one year by sale of equity shares.
The major classes of assets and liabilities comprising the disposal group held
for sale are as follows:
Year ended
30 June 2024
£’000
Goodwill
358
Trade and other receivables
545
Cash and cash equivalents
293
Assets of disposal group held for sale
1,196
Trade and other payables
486
Liabilities of disposal group held for sale
486
Compliance Week has not been classified as a discontinued operation under IFRS 5
because it does not meet the IFRS 5 criteria as a significant line of business.
Notes to the financial statements continued
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151
12. Goodwill
£’000
Cost
At 1 July 2022
100,693
Exchange translation differences
(567)
At 30 June 2023
100,126
Write-off of fully impaired goodwill no longer owned
(28,963)
Acquisition
11,156
Reclassification to held for sale
(358)
Disposals
(24,545)
Exchange translation differences
114
At 30 June 2024
57,530
Accumulated impairment
At 30 June 2022 and 30 June 2023
39,565
Write-off of fully impaired goodwill no longer owned
(28,963)
Impairment
4,434
Disposals
(10,269)
At 30 June 2024
4,767
Net book amount
At 30 June 2024
52,763
At 30 June 2023
60,561
At 30 June 2022
61,128
Goodwill arising on business combinations is not amortised but reviewed for
impairment on an annual basis, or more frequently if there are indications that
goodwill may be impaired. Determining whether the carrying value of acquired
goodwill is recoverable is a significant judgment given the material nature of the
goodwill balance and the significant assumptions underpinning management’s
impairment assessment of the Group’s cash generating units (‘CGUs’). The Group
identifies its CGUs on a business operation level. This is consistent with the way
the chief operating decision maker reviews performance.
Annual impairment review
The recoverable amount for each CGU has been determined using value in use
calculations. These calculations use the post-tax future cash flow forecasts
covering a three-year period based on Board approved budgets. Cash flow
projections in these budgets have been based on growth assumptions that reflect
anticipated market trends in the range of industries served by the brands within
each CGU. Overall, these projections assume stable profit margins reflecting
market presence expansion, whilst managing the impact of projected inflationary
and recessionary pressures. Post-tax cash flows beyond the three-year period are
then extrapolated using an estimated long term growth rate of 2.0% (2023: 2.0%),
providing a ‘base case’ scenario for the purpose of the impairment review. Key
assumptions for the value in use calculations are those regarding discount rates,
three-year cash flow forecasts and long-term growth rates. The CAGR over the
3-year period is 8.2% and profit margins are assumed to stay steady.
During the second half of the year, management detected indicators of impairment
in the Compliance Week CGU. Management performed a value in use analysis,
which when compared to the recoverable amount, identified that an impairment of
£4.4m was required. As a result, the goodwill in the CGU was impaired by £4.4m.
The impairment arose due to the financial performance of the CGU compared to
the budget and the prior year, along with management’s reassessment of the
ongoing business environment.
As part of the impairment assessment all remaining CGU’s indicated significant
levels of headroom with the exception of Astutis ('HSE'), which resulted in
headroom of £0.6m. The results of our sensitivity testing are disclosed on the
following page for the Astutis CGU.
Discount rates
Management have opted to use the post- tax discount rates for discounting
the value in use cashflows due to the linkage with observable market data.
A reconciliation has been performed to ensure the same outcome is principally
reached when using either the pre-tax or post-tax rate approach.
Notes to the financial statements continued
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152
12. Goodwill continued
Discount rates continued
The following pre-tax and post-tax rates have been applied:
Pre-tax discount rates
Post-tax discount rates
Territory
Year ended
30 June 2024
%
Year ended
30 June 2023
%
Year ended
30 June 2024
%
Year ended
30 June 2023
%
United Kingdom
16.2
18.4
12.2
13.8
United States
16.9
19.0
12.1
13.7
France
n/a
18.7
n/a
13.4
Post-tax discount rates are calculated on a company specific participant basis,
movements in the post-tax discount rates for CGUs since the prior year are driven
by changes in company specific market-based inputs. Management considers the
post-tax discount rates to be calculated using appropriate methodology. The rates
are in in line with its peers, and the Board views the rates as accurately reflecting
the return expected by a market participant. The Group no longer owns a CGU
in France and have therefore not determined a discount rate for this territory.
Sensitivity to changes in assumptions
The Group has performed sensitivity testing to assess the impact of changes in
assumptions on the value in use of each CGU. The sensitivity analysis performed
assessed the impact of pessimistic but reasonably possible changes to future cash
flows and pre-tax discount rates. All CGUs apart from Astutis retained significant
headroom even in these sensitised calculations, leading to the conclusion that
there is no realistic change of assumption that would result in the carrying value
to exceed its recoverable amount. Below are the calculated sensitivities for Astutis.
•
If the post-tax WACC rate increased/ decreased by 1 percentage point, the
overall impact would be an impairment of £1.3m/ result in headroom of £2.9m.
•
If the VIU cashflows were reduced by 10% each year, the impairment would
be £1.5m. Equally a 10% increase in cashflows would result in headroom
of £2.7m.
Cash generating units
During the year, the Axco & Pendragon CGU was split out into separate CGUs
using their original goodwill values. The change was required to align to
Wilmington’s updated operating segments representing reporting to the chief
operating decision maker. Under the new operating segments, Axco is included
within the Financial Services Division and Pendragon is included within the
Legal Division.
The following table details the net book value of goodwill allocated to each CGU:
CGU
30 June 2024
£’000
30 June 2023
£’000
UK Healthcare
—
11,885
Axco and Pendragon
—
11,150
Axco
10,392
—
Pendragon
758
—
Accountancy (Mercia)
8,307
8,307
Legal (Bond Solon)
6,796
6,796
Compliance (ICA, CLTi)
7,972
7,972
Compliance Week
—
4,719
FRA
7,382
7,341
Business Intelligence
—
2,391
Astutis (HSE)
11,156
—
52,763
60,561
Compliance Week is classified as held for sale and therefore the remaining balance
of £0.4m can be found in note 11.
Notes to the financial statements continued
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Wilmington plc Annual Report and Financial Statements 2024
153
13. Other intangible assets
Group
Computer
software
£’000
Databases
£’000
Customer
relationships
£’000
Brands
£’000
Publishing
rights and titles
£’000
Total
£’000
Cost
At 30 June 2022
6,251
13,870
9,622
10,223
9,685
49,651
Additions
595
—
—
—
—
595
Disposals
(1,213)
—
—
—
—
(1,213)
Exchange translation differences
(48)
(39)
(173)
(99)
—
(359)
At 30 June 2023
5,585
13,831
9,449
10,124
9,685
48,674
Acquisition
—
—
6,847
1,888
1,126
9,861
Write-off of fully amortised intangible assets
(1,335)
(13,843)
(2,271)
(5,917)
(2,066)
(25,432)
Reallocation between categories
—
—
94
—
(94)
—
Reclassification to Held for Sale
(544)
—
—
—
—
(544)
Additions
235
—
—
—
—
235
Disposals
(2,401)
—
(2,894)
(4,240)
(4,792)
(14,327)
Exchange translation differences
4
13
38
34
—
89
At 30 June 2024
1,544
1
11,263
1,889
3,859
18,556
Accumulated amortisation
At 1 July 2022
3,876
13,581
6,679
7,622
8,466
40,224
Charge for the year
1,690
194
1,059
683
445
4,071
Disposals
(1,056)
—
—
—
—
(1,056)
Exchange translation differences
(25)
(32)
(144)
(98)
—
(299)
At 30 June 2023
4,485
13,743
7,594
8,207
8,911
42,940
Charge for the year
1,025
117
1,369
705
445
3,661
Write-off of fully amortised intangible assets
(1,335)
(13,843)
(2,271)
(5,917)
(2,066)
(25,432)
Reallocation between categories
115
(28)
(17)
(17)
62
115
Reclassification to Held for Sale
(544)
—
—
—
—
(544)
Disposals
(2,266)
—
(2,502)
(2,933)
(4,792)
(12,493)
Exchange translation differences
3
12
30
28
—
73
At 30 June 2024
1,483
1
4,203
73
2,560
8,320
Net book amount
At 30 June 2024
61
—
7,060
1,816
1,299
10,236
At 30 June 2023
1,100
88
1,855
1,917
774
5,734
At 30 June 2022
2,375
289
2,943
2,601
1,219
9,427
The potential risks arising from climate change to the Group’s key operations in the short to medium term have been assessed and no assets have been impaired
as a result of this exercise.
Notes to the financial statements continued
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154
14. Property, plant and equipment
Group
Land, freehold and
leasehold buildings
£’000
Fixtures
and fittings
£’000
Computer
equipment
£’000
Motor vehicles
£’000
Right-of-use assets
Land and buildings
£’000
Total
£’000
Cost
At 1 July 2022
3,577
2,932
4,153
111
13,523
24,296
Additions
—
250
211
—
396
857
Lease modifications
—
—
—
—
1,529
1,529
Disposals
(24)
(754)
(2,206)
(111)
(567)
(3,662)
Exchange translation differences
—
(10)
(6)
—
(8)
(24)
At 30 June 2023
3,553
2,418
2,152
—
14,873
22,996
Additions
—
18
114
—
—
132
Acquisitions
69
—
—
—
286
355
Lease modifications
—
—
—
—
(834)
(834)
Write-off of fully depreciated assets
—
—
(42)
—
—
(42)
Reallocation between categories
—
181
(77)
—
—
104
Reclassification between categories
(2,217)
2,217
—
—
—
—
Disposals
(1,097)
(1,690)
(1,279)
—
(1,510)
(5,576)
Exchange translation differences
—
2
1
—
37
40
At 30 June 2024
308
3,146
869
—
12,852
17,175
Accumulated depreciation
At 1 July 2022
2,914
2,450
3,847
85
8,124
17,420
Charge for the year
352
199
321
12
1,437
2,321
Disposals
(29)
(759)
(2,198)
(97)
(567)
(3,650)
Exchange translation differences
—
(39)
(33)
—
(38)
(110)
At 30 June 2023
3,237
1,851
1,937
—
8,956
15,981
Charge for the year
38
129
407
—
1,277
1,851
Impairment
27
343
—
—
—
370
Write-off of fully depreciated assets
—
—
(42)
—
—
(42)
Reallocation between categories
(90)
240
(161)
—
—
(11)
Reclassification between categories
(1,825)
1,825
—
—
—
—
Disposals
(1,097)
(1,444)
(1,278)
—
(222)
(4,041)
Exchange translation differences
—
1
1
—
(20)
(18)
At 30 June 2024
290
2,945
864
—
9,991
14,090
Net book amount
At 30 June 2024
18
201
5
—
2,861
3,085
At 30 June 2023
316
567
215
—
5,917
7,015
At 30 June 2022
663
482
306
26
5,399
6,876
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14. Property, plant and equipment continued
During the year, the lease term on the head office building was renegotiated
and we will exit the building in December 2024, the lease was modified and
the right‑of-use asset reflects the remaining asset to December 2024.
Reclassifications between categories relates to a change in accounting policy
to align to the fixed asset register.
The potential risks arising from climate change to the Group’s key operations in
the short to medium term have been assessed and no assets have been impaired
as a result of this exercise.
Depreciation of property, plant and equipment is charged to operating expenses
within the income statement.
Company
Right-of-use
assets
Land and
buildings
£’000
Cost
At 1 July 2022, 30 June 2023
9,889
Lease modification
(834)
At 30 June 2024
9,055
Accumulated depreciation
At 1 July 2022
5,781
Charge for the year
724
At 30 June 2023
6,505
Charge for the year
725
At 30 June 2024
7,230
Net book amount
At 30 June 2024
1,825
At 30 June 2023
3,384
At 30 June 2022
4,108
15. Investments in subsidiaries
Company
Shares in
subsidiary
undertakings
£’000
Net book value as at 1 July 2022 and 1 July 2023
49,420
Disposal of the Healthcare business
(6,259)
Net book value as at 30 June 2024
43,161
The following table gives details of the entities controlled and included in the
consolidated financial statements of the Group at 30 June 2024. Except where
indicated, all of the entities are incorporated in and principally operated in the UK.
Subsidiaries marked * are directly owned by Wilmington plc; all other subsidiaries
are indirectly owned. Subsidiaries marked ** are companies limited by guarantee,
have no ordinary shares and are controlled indirectly by Wilmington plc.
Subsidiaries marked + have claimed audit exemptions for the year to 30 June 2024
under Section 479A of the Companies Act 2006.
During the year the Group disposed of MiExact Limited, an investment held directly
by Wilmington Publishing & Information Limited, and the Healthcare and APM
businesses, consisting of investments held directly by Wilmington Insight Limited.
During the year the Group acquired Astutis Limited, an investment held directly by
Wilmington Legal Limited. There were no impairments or dissolutions during the
year (2023: nil).
Notes to the financial statements continued
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156
15. Investments in subsidiaries continued
Name of company
UK
company
number
Registered
address
Business
Percentage
owned
Astutis Limited+
07349554
WCH
Training courses in health, safety & environmental industries
100
Axco Insurance Information Services Limited+
03073807
WCH
Provision of international compliance and regulatory information for the global
insurance industry
100
Bond Solon Training Limited+
02271977
WCH
Witness training and conferences
100
CLT International Hong Kong Limited (incorporated and operates in Hong Kong)
n/a
PRU
Certified professional training
100
CLT International Limited+
06309789
WCH
Certified professional training
100
ICA Commercial Services Limited+
04363296
WCH
Training courses in international compliance and money laundering
100
ICA Risk Management Limited+
04519229
WCH
Facilitation of ISO certification for businesses
100
International Compliance Association Limited**+
04429302
WCH
Professional association; a not for profit organisation
100
International Compliance Training Academy PTE Limited (incorporated and
operates in Singapore)
n/a
CEC
Training courses in international compliance and money laundering
100
International Compliance Training (Middle East) Ltd (incorporated and operates in
the UAE)
n/a
GAT
Training courses in international compliance and money laundering
100
International Compliance Training SDN. BHD (incorporated and operates in
Malaysia)
n/a
VER
Training courses in international compliance and money laundering
100
Mercia Group Limited+
01464141
WCH
Training and support services to the accountancy profession
100
Mercia Ireland Limited (incorporated and operates in Ireland)
n/a
BAG
Training and support services to the accountancy profession
100
Mercia NI Limited+
NI038498
ADE
Non-trading
100
SWAT UK Limited+
03041771
WCH
Non-trading
100
Wilmington Centre Knowledge India Private Limited (incorporated in India)
n/a
KAI
Non-trading
100
Wilmington Compliance Week Inc. (incorporated and operates in the US)
n/a
ORA
Provision of international compliance and regulatory information in the US
100
Wilmington FRA Inc. (incorporated and operates in the US)
n/a
ORA
Conference and networking provider of specialist events in healthcare and finance
100
Wilmington Holdings No.1 Limited*
08313253
WCH
Holding company
100
Wilmington Holdings US Inc. (incorporated and operates in the US)
n/a
ORA
Holding company
100
Wilmington IBT Limited+
01221570
WCH
Dormant
100
Wilmington Insight Limited+
02691102
WCH
Holding company
100
Wilmington Legal Limited+
02522603
WCH
Holding company
100
Wilmington plc Employee Share Ownership Trust+
n/a
WCH
Trust
n/a
Wilmington Publishing & Information Limited
03368442
WCH
Provision of information and events for professional markets
100
Wilmington Shared Services Limited
08314442
WCH
Provision of shared services
100
Notes to the financial statements continued
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15. Investments in subsidiaries continued
The registered company addresses for each subsidiary undertaking are abbreviated as shown below.
Registered address
Abbreviation
Titanic Suites, 55-59 Adelaide Street, Belfast, United Kingdom
ADE
13 Baggot Street Upper, Dublin 4, Ireland
BAG
138 Cecil Street #06-01 Cecil Court, Singapore 069538
CEC
Gate Village, Building 10, Dubai International Financial Centre, Dubai
GAT
C-515, Kailash Esplanadel. B.S. Marg, Ghatkopar, Mumbai, Maharashtra, India, 400086
KAI
1209 Orange Street, Delaware 19801, United States
ORA
Suite 2111, 21/F., Prudential Tower, The Gateway, Harbour City, 21 Canton Road, Tsimshatsui, Kowloon, Hong Kong
PRU
Unit 30-01, Vertical Business Suite Avenue 3, Bangsar South, No.8, Jalan Kerinchi, 59200, Kuala Lumpur
VER
10 Whitechapel High Street, London E1 8QS, United Kingdom
WCH
Notes to the financial statements continued
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158
16. Trade and other receivables
Group
Company
30 June 2024
£’000
30 June 2023
£’000
30 June 2024
£’000
30 June 2023
£’000
Current
Trade receivables
16,104
22,577
—
—
Prepayments and other receivables
3,712
3,758
84
76
Contract assets
523
1,056
—
—
Amounts due from subsidiaries
—
—
125,969
114,781
20,339
27,391
126,053
114,857
Amounts due from all subsidiaries are interest free, unsecured and repayable on
demand with the intention to repay within the year. Expected credit losses on
amounts due from subsidiaries are immaterial.
17. Trade and other payables
Group
Company
30 June 2024
£’000
30 June 2023
£’000
30 June 2024
£’000
30 June 2023
£’000
Trade payables
5,021
3,039
—
—
Social security and other taxes
2,353
3,418
330
742
Accruals
14,499
15,425
3,452
2,851
Contract liabilities
27,887
33,659
—
—
Other payables
700
425
—
202
Amounts due to subsidiaries
—
—
127,549
62,715
50,460
55,966
131,331
66,510
Amounts due to subsidiaries are interest free, unsecured and repayable
on demand.
18. Financial instruments and risk management
The Group’s financial instruments arise from its operations (for example trade
receivables and trade payables), from the financing of its operations (for example
equity) and from its risk management activities (for example interest rate swaps
and forward currency contracts). The risks to which the Group is exposed include
liquidity and capital risk, foreign currency risk, and credit risk.
Interest rate risk
Risk
The Group is no longer exposed to cash flow volatility arising from fluctuations in
market interest rates due to the Group net cash position. As a result of the growing
net cash position, the Group cancelled its revolving credit facility of £20 million in
August 2023.
Group policy for interest rate risk management
The Group policy for interest rate risk management is to enter into interest rate
swap contracts if beneficial to do so. This decision is based on whether the contract
would maintain the ratio of fixed to variable rate debt at a level that achieves a
reasonable cost of debt whilst reducing the exposure to cash flow volatility arising
from fluctuations in market interest rates.
There were no financial instruments in place during the year ended 30 June 2024
or 30 June 2023.
Liquidity and capital risk
Risk
The Group’s activities give rise to working capital obligations and other operational
cash outflows. The Group is consequently exposed to the risk that it cannot meet
its obligations as they fall due or can only meet them at an uneconomic price.
Group policy
The Group policy is to preserve a strong capital base in order to maintain investor,
creditor and market confidence and to safeguard the future development of the
business and to balance these objectives with the efficient use of capital.
Notes to the financial statements continued
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159
18. Financial instruments and risk management continued
Liquidity and capital risk continued
Risk management arrangements
The Group determines its liquidity requirements by the use of short- and
long‑term cash forecasts. The Group enters into short-, medium- and long-term
financial instruments when deemed necessary to support operational and other
funding requirements.
The following tables provide a maturity analysis of the remaining contractually
agreed cash flows for the Group’s non-derivative financial liabilities on an
undiscounted basis, which therefore differ from the carrying value and fair value:
Group
At 30 June 2024
Within
1 year
£’000
1–2 years
£’000
2–5 years
£’000
More than
5 years
£’000
Total
£’000
Liabilities held for sale
104
—
—
—
104
Lease liabilities
1,199
475
1,134
151
2,959
Trade and other
payables and accruals
20,220
—
—
—
20,220
21,523
475
1,134
151
23,283
At 30 June 2023
Within
1 year
£’000
1–2 years
£’000
2–5 years
£’000
More than
5 years
£’000
Total
£’000
Bank loans including
interest
120
—
—
—
120
Lease liabilities
774
1,976
3,993
990
7,733
Trade and other
payables and accruals
18,889
—
—
—
18,889
19,783
1,976
3,993
990
26,742
Company
At 30 June 2024
Within
1 year
£’000
1–2 years
£’000
2–5 years
£’000
More than
5 years
£’000
Total
£’000
Lease liabilities
893
202
605
151
1,851
Accruals and amounts
due to subsidiary
undertakings
127,549
—
—
—
127,549
128,442
202
605
151
129,400
At 30 June 2023
Within
1 year
£’000
1–2 years
£’000
2–5 years
£’000
More than
5 years
£’000
Total
£’000
Bank loans including
interest
120
—
—
—
120
Lease liabilities
202
1,556
2,888
353
4,999
Trade payables, accruals
and amounts due to
subsidiary undertakings
65,768
—
—
—
65,768
66,090
1,556
2,888
353
70,887
Foreign currency risk
Risk
The currency of the primary economic environment in which the Group operates
is Sterling, and this is also the currency in which the Group presents its financial
statements. However, the Group has US Dollar linked cash flows arising from
international trading and overseas operations. The Group is consequently exposed
to cash flow volatility arising from fluctuations in the applicable exchange rate for
converting US Dollars to Sterling.
Group policy
The Group policy is to manage foreign currency risk, and to fix the exchange rate
when deemed necessary to manage the exchange rate risk relating to foreign
net cash inflows. Decisions are approved by the Board as part of the budgeting
process and upon the acquisition of foreign operations.
There were no forward contracts entered into during the year ended 30 June 2024
or 30 June 2023 due to the Group deeming the risk as not significant.
Notes to the financial statements continued
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18. Financial instruments and risk management continued
Credit risk
Risk
The Group’s principal financial assets are receivables and bank balances.
The Group is consequently exposed to the risk that its customers or the banks
cannot meet their obligations as they fall due.
Group policy
The Group policy is to assess the creditworthiness and financial strength of
customers at inception and on an ongoing basis. The Group also reviews the credit
rating of its banks. Cash is held in banks with a credit rating between AAA to BBB
per Fitch (Investment Grade) at 12 September 2024.
Risk management arrangements
The Group’s credit risk is primarily attributable to its trade receivables. However,
the Group has no significant exposure to credit risk because its trading is spread
over a large number of customers. The payment terms offered to customers take
into account the assessment of their creditworthiness and financial strength,
and they are set in accordance with industry standards. The creditworthiness of
customers is considered before trading commences. Most of the Group’s customers
are large and well-established institutions that pay on time and in accordance with
the Group’s standard terms of business.
The amounts presented in the balance sheet are net of the expected credit loss
allowance. The Group applies a simplified approach to measure the expected
credit loss allowance for trade receivables classified at amortised cost, using the
lifetime expected loss provision.
The Group assesses on a forward-looking basis the expected credit losses
associated with its financial assets carried at amortised cost. Expected credit
losses are updated at each reporting date to reflect changes in credit risk.
The expected credit loss on trade receivables is estimated using a provision matrix
by reference to past default experience and credit rating, taking into account
forward-looking factors including general economic conditions and an assessment
of the current and forecast conditions at the reporting date.
The following table details the risk profile of trade receivables based on the
Group’s provision matrix.
At 30 June 2024
Not due
£’000
0–30
days
£’000
30–60
days
£’000
61–90
days
£’000
91–120
days
£’000
120+
days
£’000
Total
£’000
Gross carrying
amount
11,164
1,923
1,598
915
527
1,593
17,720
Expected credit
loss rate
0%
0%
0%
0%
4.35%
99.94%
9.12%
Expected credit loss
—
—
—
—
(23)
(1,593)
(1,616)
Net carrying
amount
11,164
1,923
1,598
915
504
—
16,104
At 30 June 2023
Not due
£’000
0–30
days
£’000
30–60
days
£’000
61–90
days
£’000
91–120
days
£’000
120+
days
£’000
Total
£’000
Gross carrying
amount
14,924
3,816
1,754
1,121
600
1,521
23,736
Expected credit
loss rate
0.05%
0.25%
0.41%
3.11%
2.24%
71.34%
4.88%
Expected credit loss
(8)
(10)
(7)
(35)
(13)
(1,086)
(1,159)
Net carrying amount
14,916
3,806
1,747
1,086
587
435
22,577
Set out below is the movement for the year in the expected credit loss relating
to trade receivables.
30 June 2024
£’000
30 June 2023
£’000
Allowances at 1 July
1,159
875
Additions charged to income statement
1,542
1,101
Allowances used
(167)
(146)
Allowances reversed
(918)
(671)
Allowances at 30 June
1,616
1,159
Notes to the financial statements continued
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Wilmington plc Annual Report and Financial Statements 2024
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18. Financial instruments and risk management continued
Fair value of financial assets and financial liabilities
The table below sets out the accounting classification and the carrying and fair
values of all of the Group’s financial assets and financial liabilities. The carrying
value of these financial instruments approximates their fair value.
Group
At 30 June 2024
Fair value
Level 3
£’000
Amortised
cost
£’000
Total
£’000
Financial assets
Cash and cash equivalents
—
67,515
67,515
Trade and other receivables
—
16,474
16,474
Deferred consideration receivable
16,518
—
16,518
Assets held for sale
—
744
744
16,518
84,733
101,251
Financial liabilities
Trade and other payables
—
(20,220)
(20,220)
Lease liabilities
—
(2,828)
(2,828)
Liabilities held for sale
—
(104)
(104)
—
(23,152)
(23,152)
At 30 June 2023
Fair value
Level 3
£’000
Amortised
cost
£’000
Total
£’000
Financial assets
Cash and cash equivalents
—
42,173
42,173
Trade and other receivables
—
22,951
22,951
Deferred consideration receivable*
1,904
—
1,904
1,904
65,124
67,028
Financial liabilities
Trade and other payables
—
(18,890)
(18,890)
Lease liabilities
—
(7,210)
(7,210)
—
(26,100)
(26,100)
* Deferred consideration receivable in 2023 has been split out to show the correct classification as fair value level 3.
Company
At 30 June 2024
Amortised
cost
£’000
Financial assets
Cash and cash equivalents
56,688
Trade and other receivables
126,053
182,741
Financial liabilities
Trade and other payables
(131,001)
Lease liabilities
(1,761)
(132,762)
At 30 June 2023
Amortised
cost
£’000
Financial assets
Cash and cash equivalents
27,483
Trade and other receivables
114,781
142,264
Financial liabilities
Trade and other payables
(65,768)
Lease liabilities
(4,647)
(70,415)
Notes to the financial statements continued
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18. Financial instruments and risk management continued
Fair value of financial assets and financial liabilities continued
Fair value measurement
The methods and assumptions used to estimate the fair values of financial assets
and liabilities are as follows:
•
the carrying amount of trade receivables and payables approximates to fair
value due to the short maturity of the amounts receivable and payable; and
•
the fair value of the Group’s borrowings are estimated on the basis of the
discounted value of future cash flows using approximate discount rates in
effect at the balance sheet date.
Fair value hierarchy
The level in the fair value hierarchy within which the financial asset or liability is
categorised is determined on the basis of the lowest level input that is significant
to the fair value measurement. Financial assets and liabilities are classified in their
entirety into one of three levels:
•
Level 1: Quoted prices (unadjusted) in active markets for identical assets
or liabilities.
•
Level 2: Inputs other than quoted prices included within Level 1 that are
observable for the asset or liability, either directly or indirectly.
•
Level 3: Inputs for the asset or liability that are not based on observable
market data.
Valuation processes
The Group’s CFO is responsible for fair value measurements and makes the
decision as to the valuation technique to be applied, along with the level of
external support required. The results of those valuations are reviewed at each
reporting date.
The following table provides a reconciliation of movements in Level 3 financial
assets during the year:
Deferred
consideration
receivable
£’000
At 1 July 2023
1,904
Unrealised fair value gain
219
Additions
15,697
Cash settlement
(888)
Variation
(414)
At 30 June 2024
16,518
Notes to the financial statements continued
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19. Deferred tax
Movements on deferred tax assets are as follows:
Group
Share
based
payments
£’000
US deferred
consideration
£’000
Tax
losses
£’000
Lease
liabilities
£’000
Right-of-use
assets
£’000
UK intangibles
and capital
allowances
£’000
US
intangibles
£’000
Total
£’000
At 1 July 2022
504
248
289
—
—
(1,137)
(903)
(999)
Deferred tax credit/(charge) in the income statement for the year
89
(25)
—
—
—
904
21
989
Deferred tax credit included directly in equity for the year
212
—
—
—
—
—
—
212
Effect on deferred tax of a change in the corporation tax rate
40
20
23
—
—
—
—
83
Exchange translation difference
—
(77)
—
—
—
—
110
33
At 30 June 2023
845
166
312
—
—
(233)
(772)
318
Deferred tax credit/(charge) in the income statement for the year
(466)
(24)
(380)
707
(715)
(88)
541
(425)
Deferred tax credit included directly in equity for the year
379
—
—
—
—
—
—
379
Effect on deferred tax of a change in the corporation tax rate
184
36
68
—
—
120
—
480
Deferred tax for acquired intangibles on acquisition
—
—
—
—
—
(1,991)
—
(1,991)
Exchange translation difference
—
(36)
—
—
—
—
(4)
(40)
At 30 June 2024
942
142
—
707
(715)
(2,192)
(235)
(1,351)
The Group has concluded that the deferred assets relating to tax losses will be recoverable using the estimated future taxable income. The losses can be carried forward
indefinitely and have no expiry date.
The liability for deferred tax on acquired intangibles relates to the acquisition of Astutis.
Notes to the financial statements continued
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164
19. Deferred tax continued
The following is the analysis of the deferred tax balances after offset:
Group
30 June 2024
£’000
30 June 2023
£’000
Deferred tax assets
1,791
925
Deferred tax liabilities
(3,142)
(607)
(1,351)
318
Company
Lease liabilities
£’000
Right-of-use
assets
£’000
Share based
payments
£’000
Total
£’000
Asset at 1 July 2022
—
—
504
504
Deferred tax credit in the income statement for the year
—
—
89
89
Deferred tax credit included directly in equity for the year
—
—
212
212
Effect on deferred tax of a change in the corporation tax rate
—
—
40
40
Asset at 30 June 2023
—
—
845
845
Deferred tax (charge)/credit in the income statement for the year
438
(456)
(466)
(484)
Deferred tax credit included directly in equity for the year
—
—
379
379
Effect on deferred tax of a change in the corporation tax rate
—
—
184
184
At 30 June 2024
438
(456)
942
924
The following is the analysis of the deferred tax balances after offset:
Company
30 June 2024
£’000
30 June 2023
£’000
Deferred tax assets
1,380
845
Deferred tax liabilities
(456)
—
924
845
Notes to the financial statements continued
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165
20. Share capital
Group
Number of
ordinary
shares
of 5p each
Ordinary
shares
£’000
Share
premium
account
£’000
Treasury
shares
and ESOT
reserves
£’000
Total
£’000
Issued and fully paid
ordinary shares
At 1 July 2022
87,828,755
4,391
45,553
(1,093)
48,851
Issue of shares
340,052
17
—
—
17
Save As You Earn
options settlement
via ESOT
—
—
—
154
154
Save As You Earn
options settlement
via treasury shares
—
—
—
153
153
At 30 June 2023
88,168,807
4,408
45,553
(786)
49,175
Issue of shares
1,406,205
71
1,910
—
1,981
Performance share
plan options settlement
via ESOT
—
—
—
127
127
Save As You Earn
options settlement
via ESOT
—
—
—
40
40
Save As You Earn
options settlement
via treasury shares
—
—
—
1
1
At 30 June 2024
89,575,012
4,479
47,463
(618)
51,324
Company
Number of
ordinary
shares of
5p each
Ordinary
shares
£’000
Share
premium
account
£’000
Treasury
shares
£’000
Total
£’000
Issued and fully paid
ordinary shares
At 1 July 2022
87,828,755
4,391
45,553
(183)
49,761
Issue of shares
340,052
17
—
—
17
Save As You Earn
options settlement via
treasury shares
—
—
—
153
153
At 30 June 2023
88,168,807
4,408
45,553
(30)
49,931
Issue of shares
1,406,205
71
1,910
—
1,981
Save As You Earn
options settlement via
treasury shares
—
—
—
1
1
At 30 June 2024
89,575,012
4,479
47,463
(29)
51,913
In October 2023 Wilmington issued 823,568 ordinary voting shares of £0.05 to
satisfy the Company’s obligations under its Performance Share Plan. In December
2023 Wilmington issued 582,637 ordinary voting shares of £0.05 to satisfy the
Company’s obligations under its SAYE Plan.
During the year 53,519 shares held by the Employee Share Ownership Trust
(‘ESOT’) were used to satisfy the Company’s obligations under the SAYE Plan
and 54,610 shares held by the ESOT to satisfy the Company’s obligations under
its Performance Share Plan. At 30 June 2024, the ESOT held 244,522 shares
(2023: 352,651) in the Company, which represents 0.3% (2023: 0.4%) of the
called up share capital.
During the year 391 shares held in treasury were used to satisfy the Company’s
obligations under the SAYE Plan. At 30 June 2024, 4,817 shares (2023: 5,208)
were held in treasury, which represents 0.1% (2023: 0.1%) of the share capital
of the Company.
Notes to the financial statements continued
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Wilmington plc Annual Report and Financial Statements 2024
166
21. Share based payments
The Group’s share based payment arrangements are as follows:
a) Performance Share Plan (‘PSP’) awards, applying to Executives;
b) Performance Share Plan (‘PSP’) awards, applying to the Senior Leadership Team;
c) Share Option Plan (‘Options’), applying to the Senior Leadership Team; and
d) An employee Save As You Earn (‘SAYE’) scheme, for UK based employees.
An expense of £1,865,000 (2023: £1,515,000) was recognised in the income
statement of the Group for share based payments. Of this expense £1,865,000
(2023: £1,515,000) was recognised in the parent company income statement.
During the year ended 30 June 2024, the following events have occurred in respect
of each scheme.
a) PSP awards, applying to Executives
Details of Directors’ share awards are set out in the Directors’ Remuneration report.
Under the Wilmington plc 2017 Performance Share Plan:
Date of grant
Exercise
price per
award
Date of vesting
Number of
shares for
which awards
outstanding
at 1 July 2023
Awards
granted
during
year
Awards
vested
during
year
Number of
shares for
which awards
outstanding at
30 June 2024
September 2020
Nil
September 2023
427,433
— (427,433)
—
February 2021
Nil
September 2023
52,971
—
(52,971)
—
September 2021
Nil
September 2024
353,175
—
—
353,175
February 2022
Nil
September 2024
27,307
—
—
27,307
September 2022
Nil
September 2025
359,162
—
—
359,162
September 2023
Nil
September 2026
— 343,326
—
343,326
480,404 awards vested on 1 October 2023 at a share price of £3.102. 343,326
awards were granted to Executives in September 2023 with a fair value of £3.29
per award.
The performance conditions of the awards granted in September 2021 and
February 2022 are based on the proportions below:
•
65.0% earnings per share (‘EPS’); and
•
35.0% organic growth (‘ORG’).
The performance conditions of the awards granted in September 2022 are based
on the proportions below:
•
65.0% earnings per share (‘EPS’); and
•
35.0% organic growth (‘ORG’).
The performance conditions of the awards granted in September 2023 are based
on the proportions below:
•
65.0% earnings per share (‘EPS’); and
•
35.0% organic growth (‘ORG’).
The awards granted to Executives in September 2023 were valued using the
Black Scholes and Stochastic methods with the following assumptions:
•
expected volatility (%): 29.22;
•
risk-free interest rate (%): 4.06;
•
expected life (years): 2.59; and
•
expected dividends (%): nil.
Expected volatility was determined by reference to the historical volatility of the
Group’s share price. The expected life used in the model is the mid-point of the
exercise period. Expected dividend assumptions reflect the impact of dividends
in lieu in respect of awards made to Executives. These do not apply to awards
or options made to the Senior Leadership Team.
Notes to the financial statements continued
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167
21. Share based payments continued
b) PSP awards, applying to the Senior Leadership Team
Under the Wilmington plc 2017 Performance Share Plan:
Date of grant
Exercise
price per
award
Date of vesting
Number of
shares for
which
awards
outstanding at
1 July 2023
Awards
granted
during
year
Awards
vested
during
year
Awards
lapsed
during
year
Number of
shares for
which
awards
outstanding at
30 June 2024
September 2020
Nil
September 2023
155,853
—
(155,853)
—
—
September 2021
Nil
September 2024
105,825
—
—
(18,384)
87,441
February 2022
Nil
September 2024
7,270
—
—
—
7,270
September 2022
Nil
September 2025
105,598
—
—
(24,387)
81,211
December 2022
Nil
September 2025
5,299
—
—
—
5,299
April 2023
Nil
September 2025
2,569
—
—
—
2,569
September 2023
Nil
September 2026
—
93,546
—
—
93,546
April 2024
Nil
September 2026
—
14,051
—
—
14,051
The fair value of the awards granted on 29 September 2023 and 1 April 2024 was £3.48 per award.
The performance conditions of the awards granted in September 2023 and April 2024 are based on the proportions shown below:
•
65.0% earnings per share (‘EPS’); and
•
35.0% organic growth (‘ORG’).
The awards granted in September 2023 were valued using the Black Scholes method with the following assumptions:
•
expected life (years): 2.59; and
•
expected dividends (%): 2.75.
The awards granted in April 2024 were valued using the Black Scholes method with the following assumptions:
•
expected life (years): 2.59; and
•
expected dividends (%): 2.75.
Notes to the financial statements continued
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Wilmington plc Annual Report and Financial Statements 2024
168
21. Share based payments continued
c) Options
On 29 September 2023 and 1 April 2024, the Company awarded share options to selected key management. This is a discretionary scheme which enables a company
to grant share options to selected employees. The exercise price of the granted options is equal to the market price of the shares on the date of the grant. Options are
conditional on the employee completing three years’ service (the vesting period) so act as a lock-in incentive; the options have a contractual option term of ten years (or six
months if the employee leaves the company). The options are exercisable starting three years from the grant date, subject to the Group achieving growth in earnings per
share in line with the targets set out in the deed of grant. The Group has no legal or constructive obligation to repurchase or settle the options in cash.
Movements in the number of share options outstanding and their related weighted average exercise price are as follows:
Date of grant
Average
exercise price
per option
£
Date of vesting
Number of
shares for
which options
outstanding at
1 July 2023
Options
granted
during year
Options
exercised
during year
Options
lapsed
during year
Number of
shares for
which options
outstanding at
30 June 2024
September 2019
2.080
September 2022
60,469
—
(19,231)
—
41,238
September 2020
1.225
September 2023
231,544
—
(187,906)
—
43,638
September 2021
2.228
September 2024
157,525
—
—
(27,577)
129,948
February 2022
2.420
September 2024
10,905
—
—
—
10,905
September 2022
2.820
September 2025
158,396
—
—
(36,582)
121,814
December 2022
2.862
September 2025
7,949
—
—
—
7,949
April 2023
3.016
September 2025
3,854
—
—
—
3,854
September 2023
3.102
September 2026
—
140,443
—
—
140,443
April 2024
3.102
September 2026
—
23,254
—
—
23,254
Notes to the financial statements continued
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Wilmington plc Annual Report and Financial Statements 2024
169
21. Share based payments continued
c) Options continued
The fair value of the options granted on 29 September 2023 and 1 April 2024 was
£1.360 per option.
The options granted in September 2023 were valued using the Black Scholes
method with the following assumptions:
•
expected volatility (%): 35.79;
•
risk-free interest rate (%): 4.00;
•
expected life (years): 6.09; and
•
expected dividends (%): 2.75.
Expected volatility was determined by reference to the historical volatility of the
Group’s share price. The expected life used in the model is the mid-point of the
exercise period.
The options granted in April 2024 were valued using the Black Scholes method with
the following assumptions:
•
expected volatility (%): 35.79;
•
expected life (years): 6.09; and
•
expected dividends (%): 2.75.
Expected volatility was determined by reference to the historical volatility of the
Group’s share price. The expected life used in the model is the mid-point of the
exercise period.
d) Save As You Earn Options
On 19 October 2020, Save As You Earn Options with a per share exercise price of £0.96
over 984,973 ordinary shares in the Company were granted under the Wilmington
SAYE Plan 2018 to employees of the Company and its subsidiaries. At 30 June 2024
there were nil (2023: 644,324) shares for which options were outstanding.
On 6 April 2023, Save As You Earn Options with a per share exercise price of £2.45
over 426,206 ordinary shares in the Company were granted under the Wilmington
SAYE Plan 2018 to employees of the Company and its subsidiaries. At 30 June 2024
there were 390,584 (2023: 421,065) shares for which options were outstanding.
On 19 April 2024, Save As You Earn Options with a per share exercise price of £2.81
over 250,969 ordinary shares in the Company were granted under the Wilmington
SAYE Plan 2018 to employees of the Company and its subsidiaries. At 30 June 2024
there were 249,048 (2023: nil) shares for which options were outstanding.
The exercise prices of £0.96, £2.45 and £2.81 relating to the 2020 SAYE Options,
the 2023 SAYE Options and the 2024 SAYE Options respectively were calculated in
accordance with the rules as set out in the SAYE Scheme. The SAYE Options will
normally vest and become exercisable over a three year vesting period from the date
of grant and can be exercised within six months following vesting.
22. Lease liabilities
The Group enters into leases of buildings in relation to offices and business premises
in the geographical locations in which they operate.
The following table shows movement in lease liabilities in the year:
Group
£’000
At 1 July 2022
7,510
Lease payments
(2,109)
Interest expense for lease liabilities
246
Additions
1,529
Exchange translation differences
34
At 1 July 2023
7,210
Lease payments
(881)
Interest expense for lease liabilities
175
Lease modification
(2,658)
Additions
336
Disposal of subsidiary
(1,300)
Exchange translation differences
(54)
At 30 June 2024
2,828
Notes to the financial statements continued
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Wilmington plc Annual Report and Financial Statements 2024
170
22. Lease liabilities continued
Company
£’000
At 1 July 2022
6,225
Lease payments
(1,756)
Interest expense for lease liabilities
178
At 1 July 2023
4,647
Lease payments
(369)
Interest expense for lease liabilities
141
Lease modification
(2,658)
At 30 June 2024
1,761
The following table shows the discounted lease liabilities included in the Group
and Company balance sheets:
Group
Company
30 June 2024
£’000
30 June 2023
£’000
30 June 2024
£’000
30 June 2023
£’000
Current
1,257
975
923
202
Non-current
1,571
6,235
838
4,445
2,828
7,210
1,761
4,647
A reconciliation of the movement in the right-of-use assets is included in note 14.
The maturity analysis of lease liabilities on a contractual undiscounted cash flow
basis is included in note 18. Amounts recognised through the Consolidated income
statement in respect of short-term leases and low-value leases are included in
note 4. The total cash outflow for leases was £881,000 (2023: £2,203,000) with
the year-on-year decrease relating to a difference in the timing of payments. There
are no leases with variable payments.
During the year, the lease term on the head office building was renegotiated and
we will exit the building in December 2024, the lease was modified, and the
remaining liability reflects the discounted lease payments until December 2024.
Contracts entered into by the Group have a wide range of terms and conditions
but generally do not impose any additional covenants. Extension and termination
options provide the Group with additional operational flexibility.
These options are included in the lease term if the Group considers it reasonably
certain that the lease will be extended or terminated.
23. Provisions
Property and other
£’000
At 1 July 2022
1,535
Utilised in the year
(307)
At 1 July 2023
1,228
Provision unwind due to change of contract term
(767)
Utilised in the year
(308)
At 30 June 2024
153
30 June 2024
£’000
30 June 2023
£’000
Included in current liabilities
153
307
Included in non-current liabilities
—
921
153
1,228
The provision is in respect of anticipated costs expected to be incurred in relation
to the closed proportion of the head office until the end of the contractual lease
term, including service charge, insurance and, repairs and maintenance. During
the year, the lease term on the head office building was renegotiated and we will
exit the building in December 2024, the provision was unwound and the liability
reflects the term until December 2024.
The provision is based on assumptions and estimates where the ultimate outcome
may be different from the amount provided. The provision reflects the Group’s best
estimate of the probable exposure as at 30 June 2024. This assessment has been
made having considered the sensitivity of the provision for possible changes in
key assumptions. The Group has reviewed the provisions held and concluded no
adjustments are required for climate change risks.
24. Commitments
The Group had no (2023: none) capital commitments contracted but not provided
for in relation to property, plant and equipment at 30 June 2024.
Notes to the financial statements continued
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171
25. Related party transactions
The Company and its wholly owned subsidiary undertakings offer certain
Group‑wide purchasing facilities to the Company’s other subsidiary undertakings
whereby the actual costs are recharged.
The Company has made no recharges (2023: £nil) to its fellow Group undertakings
in respect of management services.
Amounts due from and to subsidiary undertakings by the Company are set out
in notes 16 and 17 respectively.
During the year, the Company received dividends of £5,157,000 from subsidiaries
(2023: £1,359,000).
There were no (2023: £nil) transactions with related parties of key management
personnel during the year.
26. Staff and their pay and benefits
a) Employee costs from continuing operations (including Directors) were
as follows:
Group
Company
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Wages and salaries*
36,440
37,435
2,439
3,736
Social security costs
4,188
4,392
337
401
Other pension costs
1,084
1,032
40
52
Share based payments
(including social
security costs)
1,865
1,515
1,865
1,515
43,577
44,374
4,681
5,704
*Excluded from wages and salaries in the Group figures are redundancy costs in the year of £298,624 (2023:
£689,025). Company none (2024: £nil)
b) Remuneration of key management personnel that held office for part or all of
the year (2024: 10 people; 2023: 10 people), which includes the Directors and
other key management personnel, is shown in the table to the right.
Group
Company
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Short term
employee benefits
3,612
2,860
3,313
2,268
Compensation for
loss of office
—
123
—
—
Post-employment
benefits
56
80
45
51
Share based payments
1,313
673
1,313
673
4,981
3,736
4,671
2,992
All key management personnel are part of the Executive Committee. More
detailed information concerning Directors’ remuneration, shareholdings, pension
entitlement, share options and other Long Term Incentive Plans (‘LTIPs’) is shown
in the audited part of the Directors’ Remuneration report on pages 95 to 100
which forms part of the consolidated financial statements.
c) The average monthly number of employees from continuing operations
(including Directors) employed by the Group was as follows:
Group
Company
Year ended
30 June 2024
Number
Year ended
30 June 2023
Number
Year ended
30 June 2024
Number
Year ended
30 June 2023
Number
Revenue delivery
373
377
—
—
Administration
274
276
16
17
647
653
16
17
Total full-time equivalents from continuing operations at 30 June 2024 were 582
(2023: 600).
d) Retirement benefits:
The Group contributes to defined contribution pension schemes. Total contributions
to the schemes during the year from continuing operations were £1,084,000
(2023: £1,032,000).
Notes to the financial statements continued
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27. Cash generated from operations
Group
Company
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
From continuing and
discontinued operations:
Profit/(loss) before tax from
continuing operations
24,208
20,492
(22,854)
2,986
Profit before tax from
discontinued operations
24,694
3,530
—
—
Adjusting item – gain on disposal
of subsidiaries included in
continuing operations
(5,465)
(2,212)
—
—
Adjusting item – gain on disposal
of subsidiaries included in
discontinued operations
(21,367)
—
—
—
Adjusting item – gain on sale of
property, plant and equipment and
lease modification (see note 4a)
(2,189)
—
—
—
Adjusting items
598
147
—
29
Depreciation of property, plant
and equipment included in
operating expenses
1,851
2,321
9,940
—
Amortisation of intangible assets
(continuing and discontinued)
3,662
4,071
—
—
Impairment of goodwill
4,434
—
—
—
Non-adjusting profit on disposal of
property, plant and equipment
—
(36)
—
—
Share based payments (including social
security costs)
1,865
1,515
1,865
1,515
Net finance income
(1,997)
(232)
(1,840)
(314)
Operating cash flows before
movements in working capital
30,294
29,596
(12,889)
4,216
(Increase)/decrease in trade and
other receivables
(2,784)
(107)
14,136
5,010
Increase in trade and other payables
2,545
4,023
27,312
10,105
Decrease in provisions
(308)
(307)
—
—
Cash generated from operations
before adjusting items
29,747
33,205
28,559
19,331
Cash conversion is calculated as a percentage of cash generated by operations to
adjusted EBITA as follows:
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
From continuing and discontinued operations:
Funds from operations before adjusting items:
Adjusted EBITA from continuing operations (note 2)
21,679
19,273
Adjusted EBITA from discontinued operations
3,874
4,833
Share based payments (including social security costs)
1,865
1,515
Amortisation of intangible assets – computer software
(continuing and discontinued)
1,025
1,690
Depreciation of property, plant and equipment (continuing and
discontinued)
1,851
2,321
Non-adjusting profit on disposal of property, plant and
equipment
—
(36)
Operating cash flows before movement in working capital
30,294
29,596
Net working capital movement
(547)
3,609
Funds from operations before adjusting items
29,747
33,205
Cash conversion
116%
138%
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Free cash flow:
Operating cash flows before movement in working capital
30,294
29,596
Proceeds on disposal of property, plant and equipment
884
13
Net working capital movement
(547)
3,609
Interest received
1,946
344
Payment of lease liabilities
(881)
(2,109)
Tax paid
(7,115)
(3,268)
Purchase of property, plant and equipment
(132)
(461)
Purchase of intangible assets
(235)
(595)
Free cash flow
24,214
27,129
Notes to the financial statements continued
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28. Reconciliation of net cash movements
Group
Company
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Year ended
30 June 2024
£’000
Year ended
30 June 2023
£’000
Cash and cash equivalents at beginning of the year
42,173
19,785
27,483
15,734
Cash classified as held for sale
—
758
—
Lease liabilities at beginning of the year
(7,210)
(7,510)
(4,647)
(6,225)
Net cash at beginning of the year
34,963
13,033
22,836
9,509
Net increase in cash and cash equivalents
25,635
21,630
29,205
11,749
Movement in lease liabilities
4,382
300
2,886
1,578
Cash and cash equivalents at end of the year
67,515
42,173
56,688
27,483
Cash classified as held for sale at end of the year
293
—
—
—
Lease liabilities at end of the year
(2,828)
(7,210)
(1,761)
(4,647)
Net cash at end of the year
64,980
34,963
54,927
22,836
29. Events after the reporting period
There were no events after the balance sheet date that require disclosure.
Notes to the financial statements continued
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20203
£’m
2021
£’m
2022
£’m
2023
£’m
2024
£’m
Revenue
113.1
113.0
121.0
93.1
98.3
Operating expenses (before adjusting items)
(99.1)
(96.4)
(99.4)
(73.8)
(76.6)
Adjusted EBITA
14.0
16.6
21.6
19.3
21.7
Other adjusting items
(0.6)
(3.0)
0.1
(0.1)
(0.6)
Gain on disposal of property, plant and equipment and lease modification
—
—
1.3
—
2.2
Gain on disposal of business operations
—
3.4
—
—
—
Gain on disposal of subsidiaries
—
0.8
16.3
2.2
5.4
Net gain on financing activities
—
—
0.8
—
—
Amortisation of intangible assets excluding computer software
(4.8)
(3.4)
(2.5)
(1.1)
(2.1)
Impairment of goodwill
—
(14.8)
(0.6)
—
(4.4)
Operating profit/(loss)
8.6
(0.4)
37.0
20.3
22.2
Net finance income/(expense)
(2.2)
(1.6)
(0.9)
0.2
2.0
Profit/(loss) on ordinary activities before tax
6.4
(2.0)
36.1
20.5
24.2
Taxation
(1.8)
(2.5)
(3.3)
(3.3)
(7.1)
Profit/(loss) on ordinary activities after tax
4.6
(4.5)
32.8
17.2
17.1
Profit from discontinued operations
—
—
—
3.0
24.1
Profit/(loss) for the year
4.6
(4.5)
32.8
20.2
41.2
Adjusted profit before tax
11.9
15.0
20.7
19.5
23.7
Cash generated from operations before adjusting items
26.5
17.3
24.6
33.2
29.7
Basic earnings/(loss) per ordinary share (pence)
5.33
(5.18)
37.46
19.51
19.33
Diluted earnings/(loss) per ordinary share (pence)
5.26
(5.18)
36.98
19.03
18.96
Adjusted earnings per ordinary share (pence)
10.71
13.62
18.66
16.57
19.38
Interim and proposed final dividend per share (pence)
—
6.0
8.2
10.0
11.3
Dividend cover (times)1
—
2.3
2.3
2.1
2.0
Return on sales (%)2
12.4
14.7
17.9
19.5
22.1
1. Dividend cover – adjusted earnings per ordinary share divided by the interim and proposed final dividend per share.
2. Return on sales – adjusted EBITA divided by revenue.
3. The results for financial years 2020 to 2022 have not been adjusted for the impact of discontinued operations.
Pro forma five year financial summary (unaudited)
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Joint Stockbrokers
Investec Bank plc
30 Gresham Street
London
EC2V 7QN
Numis Securities Limited
45 Gresham Street
London
EC2V 7BF
Independent auditor
Grant Thornton UK LLP
30 Finsbury Square
London
EC2A 1AG
www.grantthornton.co.uk/office-locations/london/
Solicitors
Osborne Clarke
One London Wall
London
EC2Y 5EB
www.osborneclarke.com/locations/uk/london
Principal bankers
Barclays Bank plc
1 Churchill Place
Canary Wharf
London
E14 5HP
Registrars
Equiniti Limited
Aspect House
Spencer Road
Lancing
BN99 6DA
Shareholder helpline
+44 (0) 371 384 2855 (UK)
+44 121 415 7047 (overseas)
Corporate calendar
Announcement of final results
16 September 2024
Annual General Meeting
28 November 2024
Announcement of interim results
February 2025
Registered and business address
Wilmington plc
10 Whitechapel High Street
London
E1 8QS
Tel: +44 (0)20 7490 0049
www.wilmingtonplc.com
Advisors and corporate calendar
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WLMB18220