Wynnstay Properties PLC
Annual Report and Financial Statements
for the year ended 25 March 2022
WYNNSTAY PROPERTIES PLC
ANNUAL REPORT
and
FINANCIAL STATEMENTS
YEAR ENDED 25 MARCH 2022
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CONTENTS
Registrar’s Customer Support Centre and Scam Warning
Directors and Advisers
Summary of Property Portfolio
Introduction to Wynnstay
Chairman’s Statement
Strategic Report
Chairman’s Corporate Governance Statement
Corporate Governance, Audit and Remuneration Reports
Report of the Directors
Independent Auditor’s Report
Statement of Comprehensive Income
Statement of Financial Position
Statement of Cash Flows
Statement of Changes in Equity
Notes to the Financial Statements
Five Year Financial Review
Notice of Annual General Meeting
Biographies of the Directors
– 1 –
WYNNSTAY PROPERTIES PLC
REGISTRAR’S CUSTOMER SUPPORT CENTRE
Shareholders can contact our Registrars, Link Group, through their Customer Support Centre which is
available to answer any queries in relation to individual shareholdings:
By phone: UK – 0371 664 0391
Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom
will be charged at the applicable international rate. Lines are open between 09:00 - 17:30, Monday to Friday
excluding public holidays in England and Wales.
By email: shareholderenquiries@linkgroup.co.uk
By post: Link Group, 10th Floor, Central Square, 29 Wellington Street, Leeds LS1 4DL.
WARNING: UNSOLICITED APPROACHES FOR SHARES
BOILER ROOM SCAMS
According to reports, these scams continue to increase in number, sophistication of approach and apparent
credibility.
“Boiler Room Scams” involve unsolicited phone calls, emails or correspondence, commonly concerning
investments and often mentioning the names of individual companies like Wynnstay. Typically, the scammers
will claim to be “brokers”, “investment banks” or “law firms” representing a party with a holding that wishes
to make a takeover offer and to buy shares at prices much higher than market prices.
If the recipient engages, this usually leads to a request for shareholders to provide personal financial
information, including bank details, or to pay money for documents or worthless securities. These approaches
generally come from organisations based overseas or using false UK addresses or phone numbers routed from
abroad. Even if a caller or communication may sound or appear credible, the purpose is usually fraudulent:
to obtain either personal information or money, or both. Approaches can be persistent and persuasive unless
they are immediately declined.
Shareholders should continue to be vigilant about any such approaches. There is nothing that Wynnstay can
do to deter or stop them, or the use by callers of our name or details of shareholdings. On Wynnstay’s website
(www.wynnstayproperties.co.uk), shareholders will also find a warning and a link to other information about
unsolicited approaches regarding shares on the Financial Conduct Authority’s website (https://www.fca.org.
uk/scamsmart).
– 2 –
– 3 –
WYNNSTAY PROPERTIES PLC
Company incorporated in England and Wales
Registered number: 00022473
DIRECTORS
P.G.H. COLLINS C.B.E.
(Non-Executive Chairman)
C.P. WILLIAMS, B.Sc., M.B.A., M.R.I.C.S.
(Managing Director)
C.H. DELEVINGNE
(Non-Executive Director)
P. MATHER B.Sc., F.R.I.C.S.
(Non-Executive Director)
C. M. TOLHURST, B.Sc., M.R.I.C.S., C.G.P.
(Non-Executive Director and Senior Independent Director)
REGISTERED OFFICE
Hamilton House, Mabledon Place, London WC1H 9BB
AUDITORS
CLA EVELYN PARTNERS LIMITED
(formerly Nexia Smith & Williamson)
Cumberland House, 15-17 Cumberland Place, Southampton, SO15 2BG
SOLICITORS
FIELDFISHER LLP
Riverbank House, 2 Swan Lane, London EC4R 3TT
NOMINATED ADVISER & BROKER
W H IRELAND LIMITED
24 Martin Lane, London EC4R 0DR
VALUERS
BNP PARIBAS REAL ESTATE ADVISORY &
PROPERTY MANAGEMENT UK LIMITED
5 Aldermanbury Square, London EC2V 7BP
REGISTRARS
LINK GROUP
65 Gresham Street, London EC2V 7NQ
BANKERS
C. HOARE & CO.
37 Fleet Street, London EC4P 4DQ
HANDELSBANKEN PLC
5 Welbeck Street, London W1G 9YQ
– 3 –
WYNNSTAY PROPERTIES PLC
SUMMARY OF PROPERTY PORTFOLIO
AT 25 MARCH 2022
Eastern Road
1 Industrial Unit
Quarry Wood Industrial Estate
19 Industrial Units
High Street
Offices
Crown Close Industrial Estate
7 Industrial Units
Station Road
5 Industrial Units
Hertingfordbury Road
1 Industrial Unit
Trinity Street
Brooks Road
5 Industrial Units
2 Industrial Units
1-4 Prospect Drive
4 Industrial Units
Beaver Industrial Estate
17 Industrial Units
Beaver Industrial Estate
Development Land
North Street
1 Retail Unit
City Trading Estate
6 Industrial Units
Petersfield Business Park
6 Industrial Units
Petersfield Trade Park
3 Industrial Units
Bell Lane
4 Industrial Units
Aldershot
Aylesford
Cosham
Hailsham
Heathfield
Hertford
Ipswich
Lewes
Lichfield
Liphook
Liphook
Midhurst
Norwich
Petersfield
Petersfield
Uckfield
Weston-super-Mare
Phillips Road
1 Retail Warehouse Unit
Industrial Units includes Trade Counters. All properties are Freehold.
– 4 –
WYNNSTAY PROPERTIES PLC
INTRODUCTION TO WYNNSTAY
A distinctive approach to commercial property investment primarily for private investors
Wynnstay is an AIM listed property investment and development business. Its principal shareholders are private
investors wishing to invest in a portfolio of good quality secondary commercial properties for medium to long-term
capital and income growth. The portfolio is currently focused on industrial, including trade counter, units.
Strategy
Wynnstay aims to achieve capital appreciation and generate rising dividend income for shareholders from a
diversified and resilient commercial property portfolio in Central and Southern England, with diversity and
resilience being reflected in the location, number and nature of the properties, and the mix of lease terms, tenants
and uses.
For location, the focus is on areas where there is strong occupational demand. While many tenants have been in
occupation for a considerable time, where a tenant leaves, voids can be managed and relettings can be achieved.
The majority of properties are multi-let, resulting in a number of individual tenancies in most locations, reducing
exposure to any single tenant and risk of loss of rental income in the case of defaults and voids.
Leases are mainly for terms of five years or more with relatively few short-term agreements (two years or less),
and usually with upward only rent reviews based on market rates. Flexibility in addressing tenant needs and
requirements generally mean that the terms agreed result in a mutually beneficial outcome for both parties.
Tenants comprise a broad spread of occupiers, also reducing risk exposure: national and local government,
international businesses, national trading chains and regional and local businesses. Uses include manufacturing and
services; storage and distribution; and trade counter and out-of-town retail.
Active direct management and close engagement and constructive business relationships with tenants, together
with refurbishment and selective development over time, underpin capital value and increase income.
Managed for shareholders
The portfolio is directly, rather than externally, managed. Finance and administrative operations are largely
outsourced to external providers to meet specific needs. All report to the Board, the majority of whom are non-
executive directors.
Management remuneration comprises salary and, where appropriate, a cash bonus. Wynnstay does not offer
incentive schemes, such as share plans, share options or share bonuses.
As a result both management and the Board are focused on Wynnstay’s performance for the benefit of
shareholders, operational costs are closely controlled and dilution of shareholders’ investment and potential
conflicts of interest are minimised.
Incremental growth
The portfolio has been built incrementally, with opportunities being taken to dispose of assets as and when the time
is appropriate and to reinvest in assets that offer better long-term returns.
This is achieved gradually over time, without the need for deal-driven activity in pursuit of corporate or portfolio
expansion.
Funding
Wynnstay adopts a prudent, pragmatic approach to funding. Investments are funded in part by retained profits and
recycling capital receipts from disposals and in part from borrowings, the majority at a fixed rate and held at a
modest loan-to-value level, from an experienced and supportive property lender. This provides security at times of
uncertainty in debt markets.
– 5 –
WYNNSTAY PROPERTIES PLC
INTRODUCTION TO WYNNSTAY (continued)
Valuation
Properties are valued on a cautious basis, based upon professional advice from expert external valuers, recognising
that commercial property is a cyclical market that can exhibit significant upward and downward movements over
time and that steadiness and progression are most likely to be in shareholders’ interests.
Wynnstay on AIM
Wynnstay’s shares were quoted on its AIM introduction in 1995 at a mid-market price of 150p. On the day prior to
the approval of this report, the mid-market price was 660p, an increase of 340%. The dividend paid in 1995 was 4p
per share. The dividend paid for the current year will be 22.5p per share, an increase of 462%.
Performance
Wynnstay’s distinctive approach has delivered on its strategy over both the medium and long term. Shareholders
have benefitted from substantial increases in net asset value per share and dividends as the portfolio and its
management have delivered strong results.
Corporate Performance
Year Ended 25 March
Increase
2018-2022
2022
2021
2020
2019
2018
Net Asset Value per share
44.6%
pence
1,090p
pence
911p
pence
792p
pence
807p
pence
754p
Dividends per share
28.6%
22.5p
21.0p
15.0p
19.0p
17.5p
Portfolio Performance
Year Ended 25 March
Increase
2018-2022
2022
2021
2020
2019
2018
Property Income
5.8%
£’000
2,308
£’000
2,438
£’000
2,271
£’000
2,216
£’000
2,182
Rental Income
3.2%
2,252
2,140
2,271
2,216
2,182
Portfolio Value
29.6%
38,975
34,005
34,260
35,095
30,070
Loan-to-value ratio
Gearing ratio
Occupancy at year-end
Rent Collection for year
Operating Costs/Income
Operating Costs/Portfolio
Value
Weighted average
unexpired lease term:
- to lease break
- to lease expiry
%
25.5%
%
29.4%
%
36.5%
%
35.6%
%
34.1%
21.8%
32.4%
52.2%
52.7%
43.1%
100%
100%
32.0%
1.9%
99%
99%*
34.8%
2.5%
94%
100%
30.3%
2.0%
100%
100%
28.2%
1.8%
100%
100%
30.6%
2.2%
years
years
years
years
years
3.0
4.4
2.8
4.5
3.6
4.8
2.8
4.2
3.1
4.1
* Excludes rent concessions of £29,000 granted to tenants as a result of the Covid-19 pandemic.
– 6 –
– 7 –
WYNNSTAY PROPERTIES PLC
INTRODUCTION TO WYNNSTAY (continued)
Share Price Performance
Although Wynnstay is quoted on AIM, and therefore is not a constituent of the FTSE 350 Real Estate Investment
Trusts Index, the index contains a good cross-section of quoted property companies of various forms, all much
larger than Wynnstay. Wynnstay’s share price relative to the FTSE 350 Real Estate Investment Trusts Index is
shown in the chart below. Wynnstay’s share price has substantially outperformed the index over the ten-year period.
Wynnstay share price relative to FTSE Real Estate Investment Trusts Index:
March 2012-March 2022
800.00
700.00
600.00
500.00
400.00
300.00
200.00
100.00
e
r
a
h
s
r
e
p
e
c
n
e
p
y
a
t
s
n
n
y
W
-
M arch 2012
FTSE 350 Sector Real Estate Investment Trusts Index
Wynnstay Properties PLC
M arch 2013
M arch 2014
M arch 2015
M arch 2016
M arch 2017
M arch 2018
M arch 2019
M arch 2020
M arch 2021
M arch 2022
Data source: London Stock Exchange
– 7 –
WYNNSTAY PROPERTIES PLC
CHAIRMAN’S STATEMENT
I am delighted to report on another highly successful year and excellent financial performance for Wynnstay
shareholders.
Before my usual commentary on the year, I would like to draw shareholders’ attention to the new section in the
Annual Report that precedes this statement. This Introduction to Wynnstay describes Wynnstay’s distinctive
approach to commercial property investment primarily for private shareholders and provides information both on
the Company’s performance and its share price performance over time. I will explain the reasons for this new section
later and I hope that shareholders will find it informative.
Returning now to the past year, Wynnstay’s financial performance is summarised in the following overview table.
Overview of financial performance
• Rental Income
• Net Property Income
• Operating Income
• Income before Taxation
• Earnings per share
• Dividends per share, paid and proposed
• Net asset value per share
• Loan to value ratio
• Gearing ratio
Change
2022
2021
5.2%
£2,252,000
£2,140,000
(1.3%)
70.0%
77.9%
48.3%
7.1%
19.3%
£1,569,000
£1,590,000
£7,581,000
£4,459,000
£7,202,000
£4,048,000
199.8p
22.5p
1,090p
25.5%
21.8%
134.7p
21.0p
911p
29.4%
32.4%
Portfolio
Rental income increased by 5.2% to £2,252,000 compared to the prior year (2021: £2,140,000).
In addition to rents, income in the form of dilapidations from outgoing tenants and other property related receipts of
£56,000 was received. This income is lower than the prior year (2021: £298,000), which reflected other receipts over
an extended period as explained in last year’s Annual Report.
As in previous years there has been extensive property management activity within the portfolio leading to positive
outcomes on various lease renewals, rent reviews and new lettings. The portfolio currently comprises 77 tenancies
in 83 premises at 15 separate locations. The principal focus during this year has been at Beaver Industrial Estate at
Liphook and on the completion and letting of our development at Petersfield.
At Liphook, the main highlights were the refurbishment and letting of one unit to a longstanding tenant of other
units on the estate. The tenant also extended the lease of the other units they occupy as part of the transaction. The
medium-term letting of two other recently vacated units together with the adjacent development site for use as
associated storage space for an infrastructure project were also completed. The lettings of all three units were at
significantly higher rents to those previously received. In addition, we completed the renewal of leases on five other
units at Liphook.
At Petersfield, our development of Parkers Trade Park 2 was completed within budget and with only a slight delay
to the project plan. This delay resulted from difficulties experienced by our contractor in obtaining materials and
from construction workers being absent as a result of Covid, both being common problems experienced within
the construction industry. The lettings of two of the three attractive modern units to Screwfix and Toolstation were
completed in early December 2021 and the third letting to Easy Bathrooms was completed in early February 2022.
The three tenants completed their fitting out promptly and have been trading for some months. The property will
become fully income-producing in the current financial year on expiry of initial rent-free periods and is a substantial
positive addition to our portfolio.
At our largest asset, Quarry Wood Industrial Estate at Aylesford, we were able to build on the successful activities on
which I reported last year. Here we let one unit to a new tenant at an increased rent without any void period or rent-
free period being granted and also completed two lease renewals.
Elsewhere in the portfolio we completed lease renewals or lease extensions at Lichfield, Norwich and Heathfield and
welcomed a new tenant at Lewes.
– 8 –
WYNNSTAY PROPERTIES PLC
CHAIRMAN’S STATEMENT (continued)
As reported at the half-year, the tenant of our office building at Surbiton decided not to renew the lease. Although the
longstanding tenant undertook the dilapidations required under the lease, it was clear that the property would require
substantial further updating and refitting to meet the latest standards. As a consequence we marketed the property for
both sale as well as to rent. I am pleased to report that we were able to secure a sale, which completed within a few
weeks of the property being vacated, at a price of £2.65 million. This resulted in a gross profit of £150,000 and a net
profit of £125,000 after sales costs and taxation, compared to the book value in our 2021 accounts.
At the end of the year, the portfolio was 100% let and there were no arrears or bad debts.
The successful outcome from management activities during the year is reflected positively in the annual revaluation
of the portfolio discussed in the following section.
Portfolio Valuation
Our Independent Valuers, BNP Paribas Real Estate, undertook the annual revaluation as at 25 March 2022 valuing
the Company’s portfolio at £38,975,000. This represents a 23.7% increase of £7,470,000 on the valuation as at 25
March 2021, adjusted for the sale of St James House, Surbiton. During the year capitalised development costs of
£1,583,000 were incurred to complete the construction of Parkers Trade Park 2 at Petersfield.
Significant factors in the increase in the portfolio valuation this year are the inclusion of the completed development
at Petersfield, now valued substantially above our total development costs, the impact of increased rents, new or
extended leases in the portfolio negotiated over the year and higher values being realised for comparable industrial
property assets reflecting the strength of the market for this type of investment.
The annual valuation is undertaken under accounting standards for use in our financial statements in accordance with
RICS Global Standards and values each property as a separate asset on the basis of a sale of that property in the open
market. Therefore the valuation does not take account of any additional value that might be realised if the portfolio
were to be offered on the open market or any other special factors that may be relevant in the case of individual
potential purchasers, such as sales to other property investors, existing tenants or adjoining owners.
Profits and Costs
Profits for the year are represented in the three net income lines of our Statement of Comprehensive Income.
Net property income, before the fair value adjustment of investment properties, property sales and taxation, for the
year was similar to the previous year at £1,569,000 (2021: £1,590,000).
Operating income after the fair value adjustment and property sales before taxation rose to £7,581,000 (2021:
£4,459,000).
The combined result is income before taxation for the year of £7,202,000 (2021: £4,048,000).
Our policy of exercising tight control over administrative costs has continued to be effective. Property costs were
significantly lower than in the prior year at £125,000 (2021: £255,000) as we did not incur either substantial void
costs or refurbishment expenditure prior to relettings.
Finance, Borrowings and Gearing
At the year-end, we held cash of £3.5 million (2021: £2.0 million), our borrowings were unchanged at £10.0 million
(2021: £10.0 million) and net gearing was 21.8% (2021: 32.4.%).
Our cash position remained positive throughout the year, although fluctuating, as costs were incurred on the
Petersfield development and the proceeds of sale of the Surbiton property were received towards the end of the year.
The substantial reduction in net gearing reflects our cash position, the positive result of the annual revaluation and the
sale of the Surbiton property.
As anticipated in last year’s Annual Report, in December 2021 we drew down under our new five year £10 million
facility with Handelsbanken PLC and were able to fix the interest rate at 3.61%, slightly above the rate under the
previous facility (2021: 3.35%). In addition, in December 2021 we completed the refinancing of our Revolving
Credit Facility at an increased limit of £5 million (2021: £3.5 million).
Hence at the year end Wynnstay had a very healthy financial position. In addition to our available cash balance and
positive cash flow from our property activities, our £5m revolving credit facility remained undrawn.
– 9 –
WYNNSTAY PROPERTIES PLC
CHAIRMAN’S STATEMENT (continued)
Dividend
Over recent years we have sought to pursue a progressive dividend policy that aims to provide shareholders with a
rising income commensurate with Wynnstay’s underlying growth and finances.
In the light of the excellent results for the year, the Board recommends a final dividend of 14.0p per share (2021:
13.0p). An interim dividend of 8.5p per share (2021: 8.0p) was paid in December 2021. Hence, the total dividend for
this year of 22.5p per share (2021: 21.5p) represents an increase of 7.1% on the prior year.
Over the past five years, dividends have increased by 28.6% from 17.5p to 22.5p.
Subject to shareholder approval, the final dividend will be paid on 27 July 2022 to shareholders on the register at the
close of business on 1 July 2022.
Appointment of new Auditors and Nominated Advisers
As reported at the half-year, we have appointed Nexia Smith & Williamson as our new auditors and WH Ireland
Limited as our Nominated Adviser and Corporate Broker.
With these financial statements, Nexia Smith & Williamson have completed their first audit and I am pleased to
report that the audit was well planned, progressed very smoothly and was completed in accordance with the agreed
timetable and at lower cost than last year. Nexia Smith & Williamson have subsequently changed their name to CLA
Evelyn Partners Limited and are referred to as CLA Evelyn Partners Limited throughout the remainder of this report.
Shareholders will be invited to approve the reappointment of CLA Evelyn Partners Limited at the Annual General
Meeting.
We have established an excellent working relationship with our new nominated advisers, WH Ireland Limited, who
have provided significant initial advice and guidance to us in the past few months.
Shareholder Matters
In last year’s statement I noted that we were aware that the liquidity in the market for Wynnstay shares can be
relatively thin, with only small volumes being traded and involving large spreads (the difference between the bid
and offer prices). I indicated that we would be reviewing ways in which this issue might be addressed and how the
marketability of Wynnstay shares can be improved generally. I invited shareholders with views on this subject to
express them and said that we also expected to engage with our shareholder base directly to seek opinions.
As reported in November, we engaged with a number of shareholders, large and small, on an informal basis, over the
summer and autumn and intended to continue this process and that we would reflect further on the position over the
following months and discuss with WH Ireland Limited, what steps, if any, it might be appropriate to consider. Every
shareholder will have their own reasons for buying, selling or continuing to hold investments, including Wynnstay
shares, and these reasons will change from time to time according to their personal circumstances.
As a quoted company Wynnstay has a small, and rather unusual, share register on which there are under 250
accounts, a significant number of which are connected through family relationships. Shareholders are private
investors rather than funds or institutions and, in the main, are long-term holders. A number of holdings have been
in the same families for a long time, in some cases since the Company’s formation in 1886, passing from generation
to generation. As these holders tend not to sell shares, although they may occasionally either sell or acquire further
shares, they do not necessarily see liquidity and marketability of Wynnstay shares as an issue. These long-term
investors provide stability and continuity within the shareholder base.
One consequence of this share register structure is that the volume and proportion of Wynnstay shares traded in the
market is less than for many quoted companies where share registers are larger and holdings are more dispersed.
Fewer Wynnstay shares tend to be available to trade and then only usually in modest quantities. At times this can
create frustration among investors seeking to buy shares, whether for the first time or to add to their holdings.
Frustration may also arise from the size of the “spread” and the high discount to net asset value of the share price.
However both these features also arise in other, much larger, quoted property companies. Some new investors may
also be deterred from a holding in Wynnstay in case it cannot easily be realised in the future, if and when the need
arises.
The Board has concluded that there are four actions that would assist in improving the liquidity and marketability of
Wynnstay shares.
First, to provide existing and potential investors with further succinct information on Wynnstay, its business and
performance. This is now provided in the Introduction to Wynnstay at the beginning of this report on pages 5 to
– 10 –
– 11 –
WYNNSTAY PROPERTIES PLC
CHAIRMAN’S STATEMENT (continued)
7 which describes Wynnstay’s distinctive approach as a small quoted specialist property company with a private
investor shareholder base.
Secondly, to demonstrate Wynnstay has performed well for its investors, both against its objectives and relative to
other quoted property companies, in the medium to long-term. The tables and chart set out at the beginning of this
report on pages 6 to 7 show Wynnstay’s corporate and property portfolio performance over five years as well as
the performance of its share price compared to the FTSE 350 Real Estate Investment Trusts Index over the past ten
years. The Company specific information demonstrates, in the Board’s view, the benefits of Wynnstay’s distinctive
approach and the share price comparison shows that Wynnstay’s share price has substantially outperformed the
quoted property company market in the long-term.
Thirdly, in the light of the generally limited market in the Company’s shares on AIM and the discount of the share
price to declared net asset value per share, which has typically been up to 25% in recent years, it is important for all
shareholders that the Company has an authority to purchase its own shares. This is so that the Company can act as a
purchaser in the market where it is appropriate, and in the interests of shareholders generally, to do so. Other quoted
property and investment companies, as well as other quoted companies, use share buybacks on a routine basis to
enhance earnings and net asset value per share. Where shares are bought back dividends cease to be payable, thus
conserving cash in the business and benefitting continuing shareholders; and the shares bought back can either be
cancelled or can be held in treasury for reissue.
The Board considers that in appropriate circumstances the purchase by the Company of its own shares would
represent a good use of its available cash resources, and, by increasing earnings and net asset value per share, would
assist in maximising shareholder value. The present intention would be to hold any shares bought back in treasury
so that they are available for reissue where there is market demand for shares or to facilitate individual property
acquisitions.
Fourthly, the Board considers that it would also assist in Wynnstay’s future development if authority continued to be
granted by shareholders to issue a limited number of shares without first offering them to existing shareholders. If the
authority is used, it would give Wynnstay flexibility, for instance, to issue shares for small fundraisings which might
support a larger acquisition and allow the issue of shares as part consideration on individual property acquisitions to
vendors, where the vendors wish to retain in interest in a broader portfolio of assets in a quoted company. Bringing
in new investors with an interest in commercial property and in Wynnstay’s distinctive approach to the share register
would broaden the shareholder base and support its future development.
Authority to buy back shares through market purchases
Shareholders last granted authority to the Board for the Company to buy back shares through market purchases over
ten years ago. This resulted in the purchase of 443,500 shares in 2010. Authority to buy back shares was also granted
in 2011. No shares were purchased under that authority and it has not been sought in following years.
Authority to buy back shares requires the approval by resolution of shareholders, other than those who hold or are
part of a Concert Party holding more than 30% of the shares and following a recommendation of the Independent
Directors. As I, and my immediate family, have substantial holdings and have been deemed by the Takeover Panel to
be members of a Concert Party, we cannot participate in the vote on any resolution put to shareholders.
A circular approved by the Independent Directors explaining and seeking approval of the proposed authority to make
market purchases of the Company’s shares and of an exemption under Rule 9 of the City Code on Takeovers and
Mergers is being issued to shareholders.
Authority to issue shares without pre-emption rights
For a number of years at Annual General Meetings, Shareholders have granted authority to the Board to issue
shares without first offering them to existing shareholders. This authority has been limited to 5% of the issued share
capital. As explained above, the Board considers that there may be situations in relation to the future acquisition of
properties, where the authority may continue to be useful. Hence, we are again seeking shareholder approval of a
resolution at the AGM to enable this.
Outlook
After emerging from the difficulties created by four years of uncertainty resulting from the UK leaving the European
Union followed by nearly two years of the Covid-19 pandemic we are now faced with the prospect of a war in
Europe and trade disruption arising from the Russian invasion of Ukraine. Inflation is rising sharply in the UK,
putting real pressure on business costs and household incomes with consequent potential impacts on the economy.
– 11 –
WYNNSTAY PROPERTIES PLC
CHAIRMAN’S STATEMENT (continued)
The Board considers that Wynnstay has entered this further period of uncertainty in a very healthy position. We
have an excellent property portfolio which should continue to grow unless there is significant disruption caused by
external events beyond our control or the UK economy suffers a significant downturn which affects the ability or
willingness of businesses to invest or of consumers to spend. Government measures to support business and assist
consumers in addressing the challenges will be vital.
The Board is encouraged by the progress that has been made over recent years in continuing to improve the quality
and value of the assets in the portfolio. Shareholders should bear in mind that the commercial property market is
cyclical and that asset values can move up and down over time as a result. On the other hand, Wynnstay has always
adopted a cautious and realistic approach in valuing our assets and to the management and development of the
business. As noted above, our annual revaluation is undertaken for accounting purposes and values our individual
assets, not the portfolio as a whole.
Colleagues and Advisers
Our Managing Director, Paul Williams, and our finance and company secretarial colleagues have continued to work
effectively to deliver for shareholders. I would like to thank them, as well as my colleagues on the Board and our
professional advisers, for their support over the year.
In recognition of the excellent financial results for shareholders, the Board has determined that Paul Williams should
receive a bonus for the financial year of £35,000.
Shareholding Enquiries
From time to time we receive enquiries from shareholders with questions about their shareholdings or about buying
or selling Wynnstay shares or transferring them, typically to relatives.
All enquiries about shareholdings, including changes of address and bank details and about such transfers of shares,
should be directed to our Registrars, Link Group, whose details are on page 2.
As regards buying or selling shares, this can be carried out by registering the holding online with our Registrars,
Link Group, via their secure share portal www.signalshares.com, which also enables shareholdings to be managed
quickly and easily. Shares can, of course, also be bought and sold in the usual way through a stockbroker or an online
platform.
Annual General Meeting
The AGM provides an important and valued opportunity for the Board to engage with shareholders. For the last two
years, it has not been possible to convene the meeting in the normal way due to the Covid-19 pandemic and, with
great reluctance, we held our meeting with restricted attendance and urged shareholders to cast votes by proxy.
Now that the pandemic restrictions and measures are behind us, I am pleased to say that our AGM this year will be
held at 2.30pm on Tuesday 19 July 2022 at the Royal Automobile Club, 89 Pall Mall, London SW1Y 5HS. The
Notice of Meeting is to be found at the end of this Annual Report.
The Annual General Meeting will be followed by a General Meeting for the purposes set out in the Notice of
Meeting and the circular which accompany this report and have been mentioned above.
Shareholders who have registered for Link services online can also benefit from the ability to cast their proxy
votes electronically, rather than by post. Shareholders not already registered for Link services online will need their
investor code, which can be found on their share certificate or dividend tax voucher, in order to register.
To maximise shareholder engagement, shareholders who are unable to attend the AGM are encouraged to submit in
writing those questions that they might have wished to ask in person at the meeting. Questions should be emailed to
company.secretary@wynnstayproperties.co.uk at least 48 hours in advance of the AGM. You will receive a written
response and, if there are common themes raised by a number of shareholders, we aim to provide a summary for all
shareholders, grouping themes and topics together where appropriate, on the Company’s website following the AGM.
Finally, on behalf of the Board, I would like to thank all shareholders in Wynnstay, whether they have held shares for
many years or have recently acquired their shares, for demonstrating their confidence in the Company and its future.
Philip Collins
Chairman
15 June 2022
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WYNNSTAY PROPERTIES PLC
STRATEGIC REPORT 2022
The Directors present their Strategic Report for the year ended 25 March 2022.
Following the adoption by the Company of the Quoted Company Alliance Corporate Governance Code (the
Code) certain matters required by the Code to be included in the Annual Report are now addressed in this
report, the Directors’ Report or the Corporate Governance Report with cross-references provided where
appropriate. The three reports should be read together with the Introduction to Wynnstay, the Chairman’s
Statement and the additional information required by the Code published on the Company’s website.
Business, Business Model, Strategy and Future Development
Wynnstay is a long-established, successful property investment and development company. Its business,
business model, strategy and future development are described in the Introduction to Wynnstay and the
Chairman’s Statement on pages 5 to 12.
Financial Objectives and Performance Indicators
The key financial objectives for the Company are to achieve capital appreciation and generate rising dividend
income for shareholders from a diversified and resilient commercial property portfolio as described in the
Introduction to Wynnstay and the Chairman’s Statement which also contain details of performance against
selected indicators.
The Directors consider that the Company’s performance against the indicators to be creditable. As a result of
changes made to the portfolio, including disposals of two significant properties in the past two financial years
and a development project, rental income has been relatively stable for a period while active management,
close engagement with tenants and favourable market conditions have all contributed to the substantial
increase in net asset value per share.
Risks, Uncertainties and Effective Risk Management
The principal risks and uncertainties are those associated with the commercial property market, which is
cyclical by its nature and include changes in the supply and demand for space and investor demand for
commercial property assets as well as the inherent risk of tenant failure. In the latter case, the Company seeks
to reduce this risk by requiring the payment of rent deposits when considered appropriate and monitoring the
income exposure to any tenant contributing more than 2% of total rental income on a quarterly basis.
Other risk factors include changes in legislation in respect of taxation and the obtaining of planning consents,
as well as those associated with financing and treasury management including interest rate risk. The
Company’s financial risk management policies can be found at Note 19 of the financial statements.
In common with all other business activities, the Company is exposed to many of the usual risks and
uncertainties arising from commercial, economic and political circumstances and events, as well as to
unpredictable external shocks, such as the Covid pandemic and the invasion of Ukraine by Russia. Among the
principal risks and uncertainties considered are:
• Significant potential income reduction and bad debts as tenants have difficulty in maintaining rent payments
and potential voids within the portfolio arising from tenant failures, resulting in additional costs;
• Significant potential impacts on the economy and market sentiment generally capable of adversely affecting
the commercial property market and commercial property values;
• Significant potential disruption to the businesses of letting agents, property professionals and the general
services on which the business relies;
• Significant potential impacts of inflation on costs, of supply chain constraints for raw materials and
construction products and of labour market constraints on any developments or works it may undertake.
The Company carefully vets prospective new tenants from a credit risk perspective. Bad debts are mitigated
by close engagement with businesses within a diversified mix of tenants across the portfolio.
The Board monitors carefully its rental income receipts. The Company received all the rental income due for
the financial year ended 25 March 2022 and the portfolio was 100 % let by rental value as at 25 March 2022.
The Board regularly reviews the portfolio, including feedback from engagement with tenants, in order to
assess the risk of tenant failures.
Directors’ duty to promote the success of the Company under Section 172 Companies Act 2006
The Strategic Report is required to include a statement that describes how the directors have had regard to
the matters set out in section 172(1) (a) to (f) of the Companies Act 2006 when performing their duty under
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WYNNSTAY PROPERTIES PLC
STRATEGIC REPORT 2022 (continued)
section 172. Some of the matters identified in Section 172(1) are already covered by similar provisions in the
QCA Corporate Governance Code and have thus been reported by the Company in the Corporate Governance
Statement, the Corporate Governance Report and the QCA Statement of Compliance on our website. In order
to avoid unnecessary duplication, the relevant parts of those documents are identified below and are to be
treated as expressly incorporated by reference into this Strategic Report.
Under section 172 (1) of the Companies Act 2006, each individual Director must act in the way he considers,
in good faith, would be the most likely to promote the success of the Company for benefit of its members as a
whole, and in doing so have regard (among other matters) to six matters detailed in the section.
In discharging their duties, the Directors seek to promote the success of Wynnstay for the benefit of members
as a whole and have regard to all the matters set out in Section 172(1), where applicable and relevant to the
business, taking account of its size and structure and the nature and scale of its activities in the commercial
property market. The following paragraphs address each of the six matters in Section 172(1) (a) to (f).
(a) The likely consequences of any decision in the long term: The commercial property market is cyclical by
nature. Investing in commercial property is a long-term business. The decisions that we take must have regard
to long term consequences in terms of success or failure and managing risks and uncertainties. We cannot
expect that every decision we take will prove, with the benefit of hindsight, to be the best one: external factors
may affect the market and thus change conditions in the future, after a decision has been taken. However, we
consider that our record of decisions on acquisitions, disposals and active management of the portfolio is very
strong. This is reflected in the long-term performance of Wynnstay over the years in terms of net asset value
and dividends paid to shareholders.
(b) The interests of the Company’s employees: We have only one full time employee, who is the Managing
Director. He sits on the Board with the Non-Executive Directors. There are no other employees.
(c) The need to foster the Company’s business relationships with suppliers, customers and others: We have
regularly reported in our annual reports on the constructive relationships that Wynnstay seeks to build with its
tenants and the mutual benefits that this brings to both parties; and we have extended this reporting in recent
years following Principle 3 of the QCA Code to include suppliers and others. This is therefore addressed
under Principle 3 in the QCA Compliance Statement. In the past year, it has been vital to foster our business
relationships with tenants given external factors affecting business and the economy.
(d) The impact of the Company’s operations on the community and the environment: This is also addressed
under Principle 3 of the QCA Code in the QCA Compliance Statement. Due to its size and structure and the
nature and scale of its activities, the Board considers that the impact of Wynnstay’s operations as a landlord on
the community and the environment is low. Wynnstay’s assets are used by its tenants for their own operations
rather than by Wynnstay itself. In the past year, Wynnstay has not been made aware of any tenant operations
that have had a significant impact on the community or the environment. In relation to planned developments,
Wynnstay seeks to ensure that designs and construction comply with all relevant environmental standards and
with local planning requirements and building regulations so as not to adversely affect the community or the
environment.
(e) The desirability of the Company maintaining a reputation for high standards of business conduct: This
is addressed under Principle 8 of the QCA Code in the Corporate Government Statement and in the QCA
Compliance Statement. The Board considers that maintaining Wynnstay’s reputation for high standards of
business conduct is not just desirable: it is a valuable asset in the competitive commercial property market.
(f) The need to act fairly as between members of the Company: Wynnstay has only one class of shares.
Thus all shareholders have equal rights and, regardless of the size of their holding, every shareholder is, and
always has been, treated equally and fairly. Relations with shareholders are further addressed under Principles
2, 3 and 10 of the QCA Code in the Corporate Governance Report and the QCA Compliance Statement. We
continue to review how we communicate with shareholders and we encourage shareholders to adopt electronic
communications and proxy voting in place of paper documents where this suits them as well as to raise
questions in writing if they are unable to attend annual general meetings.
This Strategic Report was approved by the Board and is signed on its behalf by:
Philip Collins
Director
15 June 2022
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– 15 –
WYNNSTAY PROPERTIES PLC
CHAIRMAN’S CORPORATE GOVERNANCE STATEMENT
As Chairman, it is my responsibility, working with my fellow Board colleagues, to ensure that good corporate
governance arrangements and standards apply within the Company.
Our corporate governance structure has evolved over many years since we became one of the first companies
admitted to AIM in 1995. We have adopted and adapted practices and procedures to promote good governance
that are considered appropriate for a company of Wynnstay’s size and structure and the nature and scale of
its activities. We have strived, as the business has grown and changed, for continual improvement making
changes in recent years, for instance, in management information flows and risk management reviews.
In September 2018, the Company adopted the Quoted Companies Alliance (QCA) Corporate Governance
Code (the Code). The Code is constructed around ten broad principles, which are set out in the Corporate
Governance Report.
At Wynnstay, we apply the principles of the Code to the extent reasonable and practicable for a company
of our size and structure and the nature and scale of our activities, recognising the flexibility that lies within
the Code so that it is neither a bureaucratic, box-ticking exercise nor results in unnecessary, inappropriate or
burdensome processes and procedures.
So, for instance, we do not see the need in a company of this size with one full-time employee, the Managing
Director, for separate remuneration and audit committees, where the functions undertaken typically by those
committees can be fully and properly carried out by the Non-Executive Directors working formally as a group
to consider remuneration and the audit plan, process and outcome. We have used individual and group review
and self-assessment suited to our small size and structure, rather than formal external Board and individual
performance reviews. During the financial year the Board conducted a further evaluation of its performance
through a self-assessment process. The results are described under Principle 7 of the Code in the Corporate
Governance Report. The evaluation has provided further useful insight into the work of the Board over the past
year and focus for the next year.
Our Statement of Compliance has been reviewed and updated concurrently with the preparation of this Annual
Report and will be placed on the website together with the index to signpost the location of disclosures
required by the Code.
The Board acknowledges that a corporate culture based on sound ethical values and behaviours is an asset
and provides competitive advantages in the commercial property market where competition is intense and
prospective and existing tenants are seeking good quality premises that are suited to their needs from a
considerate, reliable landlord. Wynnstay aims to conduct its business with a high degree of professionalism,
to operate within appropriate professional standards and legal and regulatory requirements and to act with
honesty and integrity in a manner that gives confidence to those with whom it deals.
I consider that Wynnstay’s governance structures and processes are in line with its corporate culture, and
are appropriate to its size and structure, the nature and scale of its activities and its capacity, appetite and
tolerance for risk and thus I consider them to be “fit-for-purpose”. They have evolved over time in parallel
with its objectives, strategy and business model and are suitable for the Company’s growth plans in the short
to medium term and I, with my colleagues on the Board, continue to keep them under review and to make
changes where required.
Philip Collins
Chairman
15 June 2022
– 15 –
WYNNSTAY PROPERTIES PLC
CORPORATE GOVERNANCE, REMUNERATION AND AUDIT REPORTS
Introduction
This report is presented by reference to each of the ten principles contained in the Quoted Companies Alliance
(QCA) Corporate Governance Code (the Code) under a concise heading for each principle. Where the QCA
recommends that a principle should be addressed in the Annual Report, we do so in this report, the Directors’
Report or the Strategic Report with cross-references provided where appropriate. The three reports should be
read together with the Chairman’s Statement and the additional information required by the Code published
on the Company’s website, including the Statement of Compliance. Where the Code recommends that a
principle should be addressed on the Company’s website, this report refers to the principle only and signposts
to the website, including to the Statement of Compliance. The index required by the Code to signpost where
the disclosures required by the Code are located forms part of the Statement of Compliance. For reasons
explained below this report covers audit and remuneration matters as well as corporate governance.
Principle 1: Establish a strategy and business model which promote long-term value for shareholders
A description of the application of Principle 1 is recommended by the Code to be included in the annual report
and by company law is required to be included in the Strategic Report. We therefore deal with Principle 1 in
that report.
Principle 2: Seek to understand and meet shareholder needs and expectations
A description of the application of Principle 2 is recommended by the Code to be included on a company’s
website. We therefore deal with Principle 2 in the Statement of Compliance on the Company’s website.
Principle 3: Take into account wider stakeholder and social responsibilities and implications for long-
term success
A description of the application of Principle 3 is recommended by the Code to be included on the Company’s
website. We therefore deal with Principle 3 in the Statement of Compliance on the Company’s website.
Principle 4: Embed effective risk management, considering both opportunities and threats, throughout
the organisation
A description of the application of Principle 4 is recommended by the Code to be included in the annual
report. Under company law, the Directors’ Report must include a description of financial risk management
objectives and policies and information on exposure to price risk, credit risk, liquidity risk and cash flow risk
and the Strategic Report must include a description of the principal risks and uncertainties facing a company.
We therefore deal with Principle 4 in these reports.
Principle 5: Maintain the board as a well-functioning, balanced team, led by the Chair
A description of the application of Principle 5 is recommended by the Code to be included in the annual
report. The information given below should be read together with the additional information required by the
Code to be given under Principles 6, 7, 8 and 9 provided in this report, elsewhere in this Annual Report and in
the Statement of Compliance on the Company’s website, as recommended by the Code.
The Code requires the identification of those directors who are considered to be independent and a description
of the time commitment required from directors including the number of meetings of the Board, and of any
committees, during the year, together with the attendance record of each Director.
The Board comprises one executive, the Managing Director, and four Non-Executive Directors, including the
Chairman. The Board considers that all the Non-Executive Directors are independent. The biographies of the
all the Directors are available on the Company’s website and on page 52.
Philip Collins, the Non-Executive Chairman, has been a Director since 1988 and became Chairman in
1998. He has become a significant shareholder, having decided to invest over this period, to demonstrate his
confidence in Wynnstay’s long-term prospects. He has always placed the interests of all shareholders, and
Wynnstay’s long term success, at the centre of his chairmanship, as evidenced by his actions and reports
to shareholders. His knowledge of the business and of shareholders, and his experience in both the private
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WYNNSTAY PROPERTIES PLC
CORPORATE GOVERNANCE, REMUNERATION AND AUDIT REPORTS (CONTINUED)
and public sectors, are all valuable to the Board’s deliberations. There is no evidence that his tenure or his
shareholding has had any adverse impact on his independent judgement.
Charles Delevingne has served as a Non-Executive Director since June 2002. Notwithstanding the length of
his service, Mr Delevingne continues to demonstrate his commitment to fulfilling his role as a Non-Executive
Director, providing direction on business strategy and advice on business operations using his skills and
experience in commercial property. He is not involved in the daily management of the Company, nor in any
relationships or circumstances that might give rise to a conflict of interest or interfere with his exercise of
independent judgment. In addition, he continues to demonstrate the attributes of an independent non-executive
director and there is no evidence that his tenure has had any adverse impact on his independent judgment.
Paul Mather and Caroline Tolhurst were appointed to the Board in March 2017 and were deemed independent
on appointment and remain so. They are both Chartered Surveyors and have many years of experience in
commercial property and property investment management as well as, in the case of Caroline Tolhurst, in
corporate governance through her qualification and experience as a Company Secretary.
The Non-Executive Directors are expected to devote such time as is necessary for the proper performance
of their duties. Overall, the Non-Executive Directors, other than the Chairman, are expected to spend a
minimum of 10 working days a year on the Company’s business. In practice, after taking account of around 6
or 7 scheduled Board meetings a year, preparation time, site visits and other requirements mentioned below,
12-18 days per annum would be typical. The Chairman typically spends the equivalent of 25-30 working days
per annum on the Company’s business. The following table shows directors’ attendance at Board meetings,
including ad hoc meetings, in the financial year ended 25 March 2022.
Director
Philip Collins
Paul Williams
Charles Delevingne
Paul Mather
Caroline Tolhurst
Board meetings
13/13
13/13
13/13
13/13
13/13
In addition to these meetings, all the Directors took part in two strategy discussions, three non-executive
Directors met as the Audit Committee to review and approve various audit-related matters and documents,
and two Directors also took part in Board sub-committee meetings authorised to approve the final texts of
documents or transactions on behalf of the Board.
In view of the Company’s size and nature, the Board does not consider that the establishment of formal
Board committees, such as a Remuneration Committee, a Nomination Committee or an Audit Committee, is
appropriate. Reports of the Non-Executive Directors’ consideration of Remuneration and Audit matters are
covered under Principle 10 below, as recommended by the Code.
In relation to nominations, these are managed by the Non-Executive Directors, or delegated to an ad hoc
committee of them, who report with recommendations to the Board. The approach to succession planning and
appointments is addressed, as recommended by the Code, under Principle 7 in the Statement of Compliance on
the Company’s website.
Principle 6: Ensure that between them directors have the necessary up-to-date experience, skills and
capabilities
The application of Principle 6 is recommended by the Code to be included in the annual report and is therefore
included in this report, as well as elsewhere in this Annual Report, which should be read together with the
information provided under Principles 5, 7, 8 and 9 in this report and on the Company’s website.
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WYNNSTAY PROPERTIES PLC
CORPORATE GOVERNANCE, REMUNERATION AND AUDIT REPORTS (CONTINUED)
The Code requires disclosure of the identity of each Director; the relevant experience, skills and personal
qualities that each brings to the Board; how the Board as a whole contains the necessary mix of experience,
skills and qualities and capabilities to deliver the strategy over the medium to long-term; how each director
keeps his/her skill-set up-to-date; where external advisers have been engaged, their role and where external
advice on significant matters has been obtained; and any internal advisory roles.
The names of the Directors and their experience, skills and capabilities are set out on the Company’s website.
Reference is also made to the information on each of the Non-Executive Directors given under Principle 5
above.
The Managing Director, Paul Williams, has many years of practical experience in property investment
and management. The Board has engaged experienced professionals to manage accounting, financial and
Company secretarial matters.
Alan Palmer, the Director of Finance, although not a Board Director, attends all Board meetings and advises
the Board on accounting and financial matters. He has extensive experience of the commercial property sector,
with former senior roles in finance, treasury and corporate finance in quoted property companies. His services
are provided through The CFO Centre Limited, a specialist provider of part-time Finance Director services to
small and medium sized enterprises (SMEs).
Susan Wallace FCIS, Company Secretary, is a Chartered Secretary and a founding partner of Bruce Wallace
Associates Limited, a specialist provider of company secretarial and compliance services to SME businesses
and quoted companies. In her role, she is supported by other professionals in her company.
The Board considers that the experience and knowledge of each of the Directors and the experienced
professionals is appropriate for the Company’s current operations and strategy and gives them the ability
to constructively challenge strategy, scrutinise performance and assess risk and to deliver the Company’s
strategy over the medium to long-term.
Directors keep their skill sets up-to-date with a combination of attendance at industry events, individual
reading and study and experience gained from other board roles. The Company Secretary is responsible for
ensuring the Board is aware of any applicable regulatory changes and updates the Board as and when relevant.
Directors are able to take independent professional advice in the furtherance of their duties, if necessary, at the
Company’s expense.
The Company calls on the services of specialist external advisers in the usual way for its day-to-day business
needs.
The Chairman, Senior Independent Director, Company Secretary and Director of Finance, working in their
respective roles and together, advise and support the Board as a whole, drawing on specialist external advisers
where necessary.
Principle 7: Evaluating board performance based on clear and relevant objectives, seeking continuous
improvement
The application of Principle 7 is recommended by the Code to be included in part in the annual report and in
part on a company’s website. The Company considers that it is convenient to deal with most of these matters
in one place in this report.
After the end of each financial year, the Chairman usually holds a meeting with the Non-Executive Directors
individually and as a group without the Managing Director. The Non-Executive Directors also meet annually
without the Chairman to appraise the Chairman’s performance. These meetings are intended to provide
an opportunity for open dialogue on individual and collective performance and on any necessary changes
required.
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WYNNSTAY PROPERTIES PLC
CORPORATE GOVERNANCE, REMUNERATION AND AUDIT REPORTS (CONTINUED)
The Board carried out a further internal board evaluation based, as in the previous year, on the same set of
questions typically used by smaller companies for this purpose. The Directors were asked to rate the Board’s
performance by providing a score, within a range of 0-5, and comments for each question as well as to suggest
ideas to improve the working of the Board and to make comparisons with the previous year. The scores and
comments were amalgamated into an anonymised results schedule, which was then considered by the Board.
The total ratings and average scores for each question and all the comments submitted were reviewed.
The discussion of the results identified several areas of improvement from the previous year, notably in
relation to oversight of effective risk management, the time devoted to long-term, new or emerging strategic
issues and board processes where changes in the scheduling and content of Board meetings had contributed.
Building on this, further areas of improvement identified in the evaluation included enhanced communications
on routine matters between Board meetings, focusing greater Board time and discussion on important priority
issues by improving reporting and agenda management and exploring more effective communications with
shareholders. These actions are being taken forward in 2022.
The Board will carry out a similar evaluation exercise towards the end of the current financial year, which will
include the effectiveness of the changes implemented. Given the size and nature of the Company’s business,
the Board currently does not consider it would be an appropriate use of cash resources to engage an external
firm to undertake a formal evaluation although it will keep this under review.
The approach to succession planning and appointments is addressed, as recommended by the Code, under
Principle 7 in the Statement of Compliance on the Company’s website.
Principle 8: Promote a corporate culture based on ethical values and behaviours
The application of Principle 8 is recommended by the Code to be addressed in the Chairman’s Corporate
Governance Statement. Ensuring the means to determine that values and behaviours are recognised and
respected is addressed, as recommended by the Code, under Principle 8 in the Statement of Compliance on the
Company’s website.
Principle 9: Maintain governance structures and processes that are fit-for-purpose, and support good
decision making
A high-level explanation of the application of Principle 9 is recommended by the Code to be provided in the
Chairman’s Corporate Governance Statement.
The Code recommends that supplementary detail required by the Code (role and responsibilities of Directors,
role of committees, matters reserved for the Board and plans for evolution of the governance framework)
is addressed on the website and it is so addressed under Principle 9 in the Statement of Compliance on the
Company’s website.
Principle 10: Communicate how the Company is governed and is performing by maintaining a dialogue
with shareholders and other relevant stakeholders
The application of Principle 10 of the Code is recommended by the Code to be included in part in the annual
report and in part on the website. The Company follows these recommendations and addresses the work of
committees, including in relation to audit and remuneration and the identification and reasons for any non-
publication of disclosures under the principles set out in the Code in this report.
The other matters, being the outcome of all general meeting votes and intended actions on and reasons for
significant votes cast against resolutions, are shown on the Company’s website, including under Principle
10 of the Statement of Compliance; and historical annual reports, notices and general meetings and other
governance-related material are included on the Company’s website.
Communication and dialogue with shareholders and other relevant stakeholders has already been addressed
above in this report. The performance of the business during the last financial year is reviewed in detail in the
Chairman’s Statement, the Directors’ Report and the Strategic Report and elsewhere in the Annual Report.
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WYNNSTAY PROPERTIES PLC
CORPORATE GOVERNANCE, REMUNERATION AND AUDIT REPORTS (CONTINUED)
The Board considers that the existing communication and reporting structures allow open dialogue between
shareholders and the Board and provide shareholders with a good understanding of the business.
The Code recommends the annual report to describe the work of committees and recommends inclusion in the
annual report. As already mentioned above, the Board does not have formally constituted committees, with the
Non-Executive Directors acting as a group in relation to audit and remuneration.
The following paragraphs report on the work of the Non-Executive Directors in relation to audit and
remuneration matters in the year.
Audit Report
Following the appointment of Nexia Smith & Williamson (now re-named CLA Evelyn Partners Limited) as
the Company’s new auditor in November 2021, the Senior Independent Director and the Director of Finance
met and discussed the audit with the auditor before the year-end and a draft Audit Planning Report prepared
by the auditor was reviewed subsequently by the Board.
At the completion of the audit, the auditor presented its Audit Completion Report to the Non-Executive
Directors before the Financial Statements were presented for Board approval. The discussions enabled the
auditor to explain the proposed work and its outcome and the Non-Executive Directors to raise any issues. It is
considered that the process worked well. The audit did not raise any material issues and the auditor was able
to issue the audit report as scheduled and in the usual form.
Remuneration Report
The Directors currently determine remuneration, with the Non-Executive Directors determining the
remuneration of the Executive Director and the Non-Executive Directors (other than the Chairman)
determining the Chairman’s remuneration. Directors’ fees are determined by the whole Board. Details of the
Directors’ remuneration are set out in the Directors’ Report.
It is the Company’s policy that the remuneration of Directors should be commensurate with the services
provided by them to the Company and should take account of published data on reasonable market
comparables, where available and relevant to our situation.
The Non-Executive Directors met after the end of the financial year to review the performance of the
Managing Director and determine the level of his remuneration and any bonus. Remuneration has been
determined historically by reference to a mixture of publicly available remuneration studies relating to the
relevant specialism and role, other AIM companies and a few private property companies. However, such
information has become less readily available in recent years and may not in any event be applicable to our
particular circumstances. Levels of bonus are determined by reference to the assessment of performance
against objectives for the business. This process is necessarily subjective but is considered to deliver a
reasonable result for the individual, the Company and its shareholders. For the year ended 25 March 2022,
it was agreed that a bonus was payable for the year. Details of remuneration are disclosed in the Directors’
Report.
Directors’ fees are determined primarily by reference to the fees payable in other AIM quoted companies, with
the level being set towards the lower end of the range. The Chairman’s remuneration is set having regard to
the commitment required to carry out the function and its responsibilities and having regard to the level of
Directors’ fees and, to some extent, comparables among other AIM companies.
This Report was approved by the Board and is signed on its behalf by:
Philip Collins
Director
15 June 2022
– 20 –
– 21 –
WYNNSTAY PROPERTIES PLC
REPORT OF THE DIRECTORS 2022
The Directors present their One Hundred and Thirty-Sixth Annual Report, together with the audited Financial
Statements of the Company for the year ended 25 March 2022.
Following the adoption by the Company of the Quoted Company Alliance Corporate Governance Code
(the Code) certain matters required by the Code to be included in the Annual Report are now addressed in
this report, the Strategic Report or the Corporate Governance Report with cross-references provided where
appropriate. The three reports should be read together with the Chairman’s Statement and the additional
information required by the Code published on the Company’s website.
Business and Future Development
As the Code requires a description of the business, strategy and business model promoting long-term value for
shareholders to be included in the Annual Report, and similar information is also required by company law to
be included in the Strategic Report, these matters are dealt with in the Strategic Report on pages 13 to 15.
Financial Objectives and Risks
As the Code requires a description of effective risk management systems to be included in the Annual Report
and company law requires a description of financial risk management objectives and policies, information on
exposure to risks and a description of the principal risks and uncertainties facing a company, these matters are
all dealt with in the Strategic Report as well as in Note 1.3 of the financial statements.
Profit for the Year
The profit for the year after taxation amounted to £5,418,000 (2021: £3,653,000). Details of movements in
reserves are set out in the statement of changes in equity.
Dividends
The Directors have decided to recommend a final dividend of 14p per share for the year ended 25 March 2022
payable on 27 July 2022 to those shareholders on the register at the close of business on 1 July 2022. This
dividend, together with the interim dividend of 8.5p paid on 17 December 2021, represents a total for the year
of 22.5p (2021: 21.5p).
Statement of Directors’ Responsibilities
The Directors are responsible for preparing the Strategic Report, the Directors’ Report, the Corporate
Governance Report and the financial statements in accordance with applicable law and regulations.
Company law requires the Directors to prepare financial statements for each financial year. The Directors
prepared the Company’s financial statements in accordance with UK adopted International Financial Reporting
Standards (IFRS). The Directors must only approve the financial statements if they are satisfied that they give
a true and fair view of the state of affairs of the Company and of the profit or loss of the Company for the
reporting period. In preparing these financial statements, the Directors are required to:
• select suitable accounting policies and then apply them consistently;
• make judgements and accounting estimates that are reasonable and prudent;
• state whether the financial statements have been prepared in accordance with IFRS; and
• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the
Company will continue in business.
The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain
the Company’s transactions and disclose with reasonable accuracy at any time the financial position of the
Company and enable them to ensure that the financial statements comply with the Companies Act 2006. They
are also responsible for safeguarding the assets of the Company and hence for taking reasonable steps for the
prevention and detection of fraud and other irregularities.
The Directors are responsible for the maintenance and integrity of the corporate and financial information
included on the Company’s website. Legislation in the United Kingdom governing the preparation and
dissemination of the financial statements may differ from legislation in other jurisdictions.
– 21 –
WYNNSTAY PROPERTIES PLC
REPORT OF THE DIRECTORS 2022 (continued)
Directors
The Directors holding office during the financial year under review and their interests (including spouses,
other related parties and non-beneficial interests, where applicable) in the ordinary share capital of the
Company at 25 March 2022 and 25 March 2021 are shown below:
Ordinary Shares of 25p
25.3.21
25.3.22
P.G.H. Collins
C.P. Williams
C.H. Delevingne
Non-Executive Chairman
Managing Director
Non-Executive Director
850,836
11,612
5,000
850,836
11,612
5,000
The interests shown above in respect of Mr. P.G.H. Collins include non-beneficial interests of 229,596 shares at
25 March 2022 and 2021.
Mr. C.P. Williams has a service agreement with the Company under which his employment is subject to six
months’ notice of termination by either party.
In accordance with the Company’s Articles of Association, Mr Philip Collins and Mr Paul Mather retire by
rotation and, being eligible, offer themselves for re-election at the Annual General Meeting.
Biographies of each of the Directors are available on the Company’s website and on page 52.
Directors’ Emoluments
Directors’ emoluments for the year ended 25 March 2022 are set out below:
P.G.H. Collins
C.P. Williams
C.H. Delevingne
P. Mather
C.M. Tolhurst
Total 2022
Total 2021
Salaries
Fees
Pension
Benefits
Total
2022
Total
2021
–
168,000
–
–
–
43,500
16,250
16,250
16,250
21,650
–
–
43,500
42,500
13,300
7,330
204,880
195,746
–
–
–
–
–
–
16,250
16,250
21,650
15,850
15,850
20,850
£168,000
£113,900
£13,300
£7,330
£302,530
£159,000
£110,900
£12,900
£7,996
£290,796
The above figures for 2022 include a discretionary bonus payment of £35,000 to Mr C.P. Williams being the
amount determined by the Board to reflect his performance during that year. A discretionary bonus payment of
£30,000 was paid to Mr Williams for the financial year ended 25 March 2021.
Directors’ and Officers’ Liability Insurance
The Company has maintained Directors’ and Officers’ insurance as permitted by the Companies Act 2006.
– 22 –
WYNNSTAY PROPERTIES PLC
REPORT OF THE DIRECTORS 2022 (continued)
Interests in the Company’s Shares
As at 15 June 2022, the Directors have been notified or are aware of the following interests (including spouses,
other related parties and non-beneficial interests, where applicable, for both financial years), which are in
excess of three per cent of the issued ordinary share capital of the Company, excluding shares held in treasury:
No. of Ordinary
Shares of 25p
Percentage of
Issued Share
Capital 2022
Percentage of
Issued Share
Capital 2021
P.G.H. Collins
G. J. Gibson
D. N. Gibson
Dr. G.L.A. Bird
J.V. Bird
850,836
272,192
121,378
112,000
111,750
31.38%
10.04%
4.47%
4.13%
4.12%
31.38%
10.04%
4.47%
4.13%
4.12%
Going Concern
The Directors consider, as at the date of approving the financial statements, that there is reasonable expectation
that the Company has adequate financial resources to continue to operate, and to meet its liabilities as they fall
due for payment, for at least twelve months following the approval of the financial statements.
Internal Control
The Directors are responsible for the Company’s system of internal financial control, which is designed
to provide reasonable, but not absolute, assurance against material misstatement or loss. In fulfilling these
responsibilities, the Board has reviewed the effectiveness of the system of internal financial control. The
Directors have established procedures for planning and budgeting and for monitoring, on a regular basis, the
performance of the Company.
Statement as to Disclosure of Information to Auditors
Each of the persons who are Directors at the time when this report is approved has confirmed that:
• so far as each Director is aware, there is no relevant audit information of which the Company’s auditors are
unaware; and
• each Director has taken all the steps that ought to have been taken as a Director, including making
appropriate enquiries of fellow Directors and the Company’s auditors for that purpose, in order to be aware of
any information needed by the Company’s auditors in connection with preparing their report and to establish
that the Company’s auditors are aware of that information.
Auditor
BDO LLP resigned as the Company’s auditor in November 2021, confirming that there were no matters relating
to their ceasing to hold office that ought to be brought to members’ attention, and Nexia Smith & Williamson
were engaged in their place. Nexia Smith & Williamson have subsequently changed their name to CLA Evelyn
Partners Limited. A resolution to appoint CLA Evelyn Partners Limited as the Company’s auditor for the next
financial year will therefore be proposed at the Annual General Meeting. .
Annual General Meeting
The Notice of the Annual General Meeting, to be held on 19 July 2022, is set out at the end of the Annual Report.
By Order of the Board
Susan Wallace
Secretary
15 June 2022
– 23 –
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WYNNSTAY PROPERTIES PLC
Opinion
We have audited the financial statements of Wynnstay Properties PLC (the ‘Company’) for the year ended 25 March 2022
which comprise Statement of Comprehensive Income, the Statement of Financial Position, the Statement of Changes
in Equity, the Statement of Cash Flows and the notes to the financial statements, including significant accounting
policies. The financial reporting framework that has been applied in their preparation is applicable law and UK-adopted
international accounting standards.
In our opinion, the financial statements:
• give a true and fair view of the state of the Company’s affairs as at 25 March 2022 and of its profit for the year then
ended;
• have been properly prepared in accordance with UK-adopted international accounting standards; and
• have been prepared in accordance with the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable
law. Our responsibilities under those standards are further described in the Auditor’s responsibilities for the audit
of the financial statements section of our report. We are independent of the Company in accordance with the
ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC’s Ethical
Standard as applied to listed entities, and we have fulfilled our other ethical responsibilities in accordance with these
requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for
our opinion.
Key audit matters
Key audit matters are those matters that, in our professional judgment, were of most significance in our audit of the
financial statements of the current period, and include the most significant assessed risks of material misstatement
(whether or not due to fraud) we identified, including those which had the greatest effect on: the overall audit strategy;
the allocation of resources in the audit; and directing the efforts of the engagement team. These matters were addressed
in the context of our audit of the financial statements as a whole, and in forming our opinion thereon, and we do not
provide a separate opinion on these matters.
Key audit
matter
Valuation of
investment
properties
Description of risk
How the matter was addressed in the audit
The Company holds a portfolio of
investment properties which are owned
by the Company and held for capital
appreciation and/or rental income. The
Directors measure the fair value of each
property in the portfolio at the year
end date on the basis of a valuation by
an external independent valuer whose
details can be found in Note 10 of the
accounts. The Company’s accounting
policy for investment properties is
included within Note 1.2.
The valuation of investment properties
requires significant judgement in
determining the appropriate inputs to be
used in the model and there is therefore
a risk that the properties are incorrectly
valued.
As part of our procedures, we:
•
reviewed the valuation reports for all the properties
and confirmed that the valuation approach for each
was in accordance with RICS standards and suitable
for use in determining the carrying value for the
purpose of the financial statements.
• Compared the yields used within the valuation
to market averages based on sector and location.
Variances were evaluated through gaining an
understanding of the rationale of the discrepancy,
and assessing whether this supports the valuation
overall. We further performed a sensitivity analysis
on the value of the portfolio against market averages.
• Tested the accuracy of inputs to the valuation,
including rental income and lease terms.
• We assessed the Valuers’ qualifications, expertise
and independence, and read their terms of
engagement with the Company to determine whether
there were any matters that might have affected their
objectivity or may have imposed scope limitations
upon their work.
– 24 –
– 25 –
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WYNNSTAY PROPERTIES PLC
Key audit
matter
Revenue
Recognition
Description of risk
How the matter was addressed in the audit
Revenue for the Company consists
primarily of rental income. Rental
income is based on tenancy agreements
where there is a standard process in place
for recording revenue. There are however
certain transactions within revenue that
warrant additional audit focus because of
an increased inherent risk of error due to
their non-standard nature, such as lease
incentives.
As part of our procedures, we:
• Selected a sample of properties from the investment
property register, formed an expectation of the
rent to be recognised from the lease agreement
and compared to the actual rent recognised. We
investigated variances exceeding an acceptable
threshold.
• Performed substantive existence testing by picking
a sample from the nominal ledger, agreeing to lease
agreement and tracing to invoice and then tracing
payment into the bank.
• Ensured the cut-off treatment of income and
completeness of deferred income was correct, by
selecting a sample of income recognised in the
nominal ledger either side of the year-end and
agreeing this to supporting documentation.
• Reviewed the treatment of lease incentives, and
ensured this was in line with the accounting standard.
Our application of materiality
The materiality for the Company financial statements as a whole (“Company FS materiality”) was set at £395,000.
This has been determined with reference to the benchmark of the Company’s total assets, which we consider to be one
of the principal considerations for members of the Company in assessing the Company’s performance. FS materiality
represents 0.9% of the Company’s total assets as presented on the face of the Balance sheet.
A number of key performance indicators of the Company are driven by Income Statement items and we therefore
applied a lower specific materiality of £43,765, based on 1.9% of Company revenue. This lower specific materiality
was applied to the components of the Company’s Statement of Comprehensive Income excluding investment property
valuation movements.
Performance materiality for the Company financial statements was set at £256,750, being 65% of FS materiality, for
purposes of assessing the risks of material misstatement and determining the nature, timing and extent of further audit
procedures. We have set it at this amount to reduce to an appropriately low level the probability that the aggregate of
uncorrected and undetected misstatements exceeds FS materiality. We judged this level to be appropriate based on
our understanding of the Company and its financial statements, as updated by our risk assessment procedures and our
expectation regarding current period misstatements. It was set at 65% based on our overall expectation of the level of
audit differences, and the number and significance of areas of judgement in the financial statements.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the directors’ use of the going concern basis of
accounting in the preparation of the financial statements is appropriate.
Our evaluation of the directors’ assessment of the Company’s ability to continue to adopt the going concern basis of
accounting included:
• discussion with management over the basis and appropriateness of key assumptions including corroboration
where relevant;
• Reviewing bank statements to monitor the cash position of the group post year end, and obtaining an
understanding of significant expected cash outflows (such as capital expenditure) in the forthcoming 12-month
period;
reviewing disclosures around going concern in the financial statements to ensure they are consistent with the
work performed.
•
– 25 –
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WYNNSTAY PROPERTIES PLC
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 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.
Our responsibilities and the responsibilities of the directors with respect to going concern are described in the
relevant sections of this report.
Other information
The other information comprises the information included in the annual report, other than the financial statements
and our auditor’s report thereon. The directors are responsible for the other information contained within the
annual report. Our opinion on the financial statements does not cover the other information and, except to the
extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon. Our
responsibility is to read the other information and, in doing so, consider whether the other information is materially
inconsistent with the financial statements or our knowledge obtained in the course of the audit, or otherwise appears
to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are
required to determine whether this gives rise to a material misstatement in the financial statements themselves. If,
based on the work we have performed, we conclude that there is a material misstatement of this other information,
we are required to report that fact.
We have nothing to report in this regard.
Opinions on other matters prescribed by the Companies Act 2006
In our opinion, based on the work undertaken in the course of the audit:
•
the information given in the strategic report and the directors’ report for the financial year for which the financial
statements are prepared is consistent with the financial statements; and
the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.
•
Matters on which we are required to report by exception
In the light of the knowledge and understanding of the Company and its environment obtained in the course of the
audit, we have not identified material misstatements in the strategic report or the directors’ report.
We have nothing to report in respect of the following matters in relation to which the Companies Act 2006 requires
us to report to you if, in our opinion:
• adequate accounting records have not been kept, or returns adequate for our audit have not been received from
branches not visited by us; or
the financial statements are not in agreement with the accounting records and returns; or
•
• certain disclosures of directors’ remuneration specified by law are not made; or
• we have not received all the information and explanations we require for our audit.
Responsibilities of directors
As explained more fully in the Statement of Directors’ Responsibilities on page 21 the directors are responsible for
the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such
internal control as the directors determine is necessary to enable the preparation of financial statements that are free
from material misstatement, whether due to fraud or error.
In preparing the financial statements, the directors are responsible for assessing the Company’s ability to continue
as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of
accounting unless the directors either intend to liquidate the Company or to cease operations, or have no realistic
alternative but to do so.
Auditor’s responsibilities for the audit of the financial statements
Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from
material misstatement, whether due to fraud or error, and to issue an auditor’s report that includes our opinion.
Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with
ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error
and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial statements.
– 26 –
– 27 –
INDEPENDENT AUDITOR’S REPORT
TO THE MEMBERS OF WYNNSTAY PROPERTIES PLC
The extent to which our procedures are capable of detecting irregularities, including fraud, is detailed below.
Irregularities, including fraud, are instances of non-compliance with laws and regulations. We design procedures in
line with our responsibilities, outlined above, to detect material misstatements in respect of irregularities, including
fraud.
We obtained a general understanding of the Company’s legal and regulatory framework through enquiry of
management concerning their understanding of relevant laws and regulations, the entity’s policies, and procedures
regarding compliance, and how they identify, evaluate and account for litigation claims. We also drew on our
existing understanding of the Company’s industry and regulation.
We understand that the Company complies with the framework through:
• Subscribing to relevant updates from external experts and making changes to internal procedures and controls as
necessary.
• Outsourcing accounts preparation and tax compliance to external experts;
• The directors’ close involvement in the day to day running of the business, meaning that any litigation or claims
would come to their attention directly.
In the context of the audit, we considered those laws and regulations which determine the form and content of the
financial statements, which are central to the Company’s ability to conduct its business, and/or where there is a risk
that failure to comply could result in material penalties. We identified the following laws and regulations as being of
significance in the context of the Company:
• The Companies Act 2006 and IFRS in respect of the preparation and presentation of the financial statements.
The senior statutory auditor led a discussion with senior members of the engagement team regarding the
susceptibility of the entity’s financial statements to material misstatement, including how fraud might occur. The
areas identified in this discussion were:
• Manipulation of financial statements, via fraudulent journal entries or error affecting cut off around the year end,
particularly as the size of the Company means that there is little opportunity for segregation of duties.
• The valuation of investment properties as this requires estimates and judgements to be made by management.
The procedures we carried out to gain evidence in the above areas included:
• Challenging management regarding the assumptions used in the estimates identified above.
• Substantive work on material areas affecting profits.
• Testing journal entries, focusing particularly on postings to unexpected or unusual accounts.
A further description of our responsibilities is available on the Financial Reporting Council’s website at: www.frc.
org.uk/auditorsresponsibilities. This description forms part of our auditor’s report.
Use of our report
This report is made solely to the Company’s members, as a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken so that we might state to the Company’s members
those matters we are required to state to them in an auditor’s report and for no other purpose. To the fullest extent
permitted by law, we do not accept or assume responsibility to anyone other than the Company and the Company’s
members as a body, for our audit work, for this report, or for the opinions we have formed.
Julie Mutton
Senior Statutory Auditor, for and on behalf of
CLA Evelyn Partners Limited
Statutory Auditor
Chartered Accountants
4th Floor Cumberland House
15-17 Cumberland Place
Southampton
Hampshire SO15 2BG
15 June 2022
– 27 –
STATEMENT OF COMPREHENSIVE INCOME FOR YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
Property Income
Property Costs
Administrative Costs
Net Property Income
Movement in Fair Value of:
Investment Properties
Profit on Sale of Investment Property
Operating Income
Investment Income
Finance Costs
Income before Taxation
Taxation
Income after Taxation
Basic and diluted earnings per share
Notes
2
3
4
10
6
6
7
9
The company has no items of other comprehensive income.
2022
£’000
2,308
2021
£’000
2,438
(125) (255)
(614)
1,569
5,887
125
7,581
–
(379)
7,202
(1,784)
5,418
(593)
1,590
1,748
1,121
4,459
1
(412)
4,048
(395)
3,653
199.8p
134.7p
– 28 –
WYNNSTAY PROPERTIES PLC
STATEMENT OF FINANCIAL POSITION 25 MARCH 2022
2022
£’000
38,975
3
38,978
301
3,491
3,792
(1,048)
(284)
–
(1,332)
2,460
41,438
(9,938)
(1,953)
(11,891)
29,547
789
205
1,135
(1,570)
28,988
29,547
1,090p
2021
£’000
34,005
3
34,008
342
2,001
2,343
(929)
(249)
(10,000)
(11,178)
(8,835)
25,173
–
(461)
(461)
24,712
789
205
1,135
(1,570)
24,153
24,712
911p
Notes
10
12
14
15
16
16
17
18
Non Current Assets
Investment Properties
Investments
Current Assets
Trade and other receivables
Cash and Cash Equivalents
Current Liabilities
Trade and other payables
Income Taxes Payable
Bank Loans Payable
Net Current Assets / (Liabilities)
Total Assets Less Current Liabilities
Non-Current Liabilities
Bank Loans Payable
Deferred Tax Payable
Net Assets
Capital and Reserves
Share Capital
Capital Redemption Reserve
Share Premium Account
Treasury Shares
Retained Earnings
Net Asset Value pence per share
Approved by the Board and authorised for issue on 15 June 2022
Philip Collins
Director
Registered number: 00022473
Paul Williams
Director
– 29 –
WYNNSTAY PROPERTIES PLC
STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 25 MARCH 2022
Cash flows from operating activities
Income before taxation
Adjusted for:
(Increase) in fair value of investment properties
Interest received
Interest paid
Profit on disposal of investment properties
Movement in dilapidations for property sold
Changes in:
Decrease/(increase) in trade and other receivables
Increase/(decrease) in trade and other payables
Cash generated from operations
Income taxes paid
Net cash from operating activities
Cash flows from investing activities
Interest and other income received
Purchase of investment properties
Sale of investment properties
Net cash generated from investing activities
Cash flows from financing activities
Interest paid
Dividends paid
Drawdown of bank loans net of fees
Repayment of bank loans
Net cash used in financing activities
Increase in cash and cash equivalents
Cash and cash equivalents at beginning of period
Cash and cash equivalents at end of period
2022
£’000
7,202
(5,887)
–
379
(125)
–
41
153
1,763
(284)
1,479
–
(1,583)
2,618
1,035
(379)
(583)
9,938
(10,000)
(1,024)
1,490
2,001
3,491
2021
Restated
£’000
4,048
(1,748)
(1)
412
(1,121)
55
(98)
(326)
1,221
(249)
972
1
(117)
3,187
3,071
(412)
(419)
–
(2,500)
(3,331)
712
1,289
2,001
2021 figures have been restated for the reclassification of Interest paid into Cash flows from financing activities.
– 30 –
WYNNSTAY PROPERTIES PLC
STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 25 MARCH 2022
YEAR ENDED 25 MARCH 2022
Share
Capital
£’000
Capital
Redemption
Reserve
Share
Premium
Account
Treasury
Shares
Retained
Earnings
£’000
£’000
£’000
£’000
Total
£’000
Balance at 26 March 2021
Total comprehensive
income for the year
Dividends – note 8
Balance at 25 March 2022
789
–
–
789
205
1,135
(1,570)
24,153
24,712
–
–
–
–
–
–
5,418
(583)
5,418
(583)
205
1,135
(1,570)
28,988
29,547
YEAR ENDED 25 MARCH 2021
Share
Capital
£’000
Capital
Redemption
Reserve
Share
Premium
Account
Treasury
Shares
Retained
Earnings
£’000
£’000
£’000
£’000
Total
£’000
Balance at 26 March 2020
789
205
1,135
(1,570)
20,919
21,478
Total comprehensive
income for the year
Dividends – note 8
–
–
–
–
–
–
–
–
3,653
(419)
3,653
(419)
Balance at 25 March 2021
789
205
1,135
(1,570)
24,153
24,712
FUNDS AVAILABLE FOR DISTRIBUTION
Retained Earnings
Less: Cumulative Unrealised Fair Value
Adjustment of Property Investments net of tax
Treasury Shares
Distributable Reserves
2022
£’000
28,988
(12,996)
2021
£’000
24,153
(7,967)
(1,570)
(1,570)
14,422
14,616
– 31 –
STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
Explanation of Capital and Reserves:
• Share Capital: This represents the subscription, at par value, of the Ordinary Shares of the Company.
• Capital Redemption Reserve: This represents money that the Company must retain when it has bought
back shares, and which it cannot pay to shareholders as dividends: It is a non-distributable reserve and
represents paid up share capital.
• Share Premium Account: This represents the subscription monies paid for Ordinary Shares of the
Company in excess of their par value.
• Treasury Shares: This represents the total consideration and costs paid by the Company when purchasing
the 443,650 shares as referred to in Note 18.
• Retained Earnings: This represents the profits after tax that can be used to pay dividends. However,
dividends can only be paid from Distributable Reserves as detailed in the preceding table.
– 32 –
– 33 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
1.
BASIS OF PREPARATION, ACCOUNTING POLICIES AND ESTIMATES
Wynnstay Properties PLC is a public limited company incorporated and domiciled in England and
Wales. The principal activity of the Company is property investment, development and management.
The Company’s ordinary shares are traded on the AIM, part of The London Stock Exchange. The
Company’s registered number is 00022473.
1.1 Basis of Preparation
The financial statements have been prepared in accordance with UK adopted International Financial
Reporting Standards (“IFRS”). The financial statements have been presented in Pounds Sterling being
the functional currency of the Company and rounded to the nearest thousand. The financial statements
have been prepared under the historical cost basis modified for the revaluation of investment properties
and financial assets measured at fair value through Operating Income.
(a) New Interpretations and Revised Standards Effective for the year ended 25 March 2022
The Directors have adopted all new and revised standards and interpretations issued by the
International Accounting Standards Board (“IASB”) and the International Financial Reporting
Interpretations Committee (“IFRIC”) of the IASB and adopted by applicable law that are relevant to
the operations and effective for accounting periods beginning on or after 26 March 2021;
• Amendment to IFRS 16: Leases Covid 19-Related Rent Concessions
•
IAS 37: Provisions, Contingent Liabilities and Contingent Assets
The adoption of these interpretations and revised standards had no material impact on the disclosures
and presentation of the financial statements.
(b) Standards and Interpretations in Issue but not yet Effective
The International Accounting Standards Board (“IASB”) and International Financial Reporting
Interpretations Committee (“IFRIC”) have issued the below revisions to existing standards or new
interpretations or new standards with an effective date of implementation after the period of these
financial statements.
The following new amendment applicable in future periods has not been early adopted as it is not
expected to have a significant impact on the financial statements of the Company:
• Amendments to IAS 1: Classification of Liabilities as Current or Non-current (effective for
accounting periods beginning on or after 1 January 2023).
(c) Going concern
The financial statements have been prepared on a going concern basis. This requires the Directors to
consider, as at the date of approving the financial statements, that there is reasonable expectation that
the Company has adequate financial resources to continue to operate, and to meet its liabilities as they
fall due for payment, for at least twelve months following the approval of the financial statements.
The Directors have reviewed cash balances and borrowing facilities to cover at least twelve months of
operations, including financing costs and continuation of employment and advisory costs as currently
contracted without any reduction for cost saving initiatives. The results of the review show that the
Company has cash and borrowing facilities to cover at least twelve months of operations, and that the
Company will satisfy the financial covenant ratios in the borrowing facilities as described in Note 16.
In addition, the Statement of Financial Position as at 25 March 2022 shows that the Company held a
cash balance of £3.5m and net assets of £29.5m and had a low gearing ratio of 21.8%. In the light of
the foregoing considerations, the Directors consider that the adoption of the going concern basis is
reasonable and appropriate.
– 33 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
1.2 ACCOUNTING POLICIES
Investment Properties
All the Company’s investment properties are independently revalued annually and stated at fair value
as at 25 March. The aggregate of any resulting increases or decreases are taken to operating income
within the Statement of Comprehensive Income. The basis of independent valuation is described in
Note 10.
Investment properties are recognised as acquisitions or disposals based on the date of contract
completion.
Depreciation
In accordance with IAS 40, freehold investment properties are included in the Statement of Financial
Position at fair value and are not depreciated.
The Company has no other plant and equipment.
Disposal of Investments
The gains and losses on the disposal of investment properties and other investments are included in
Operating Income in the year of disposal. Gains and losses are calculated on the net difference between
the carrying value of the properties and the net proceeds from their disposal.
Property Income
Property income is recognised on a straight-line basis over the period of the lease and is measured at
the fair value of the consideration receivable. Lease deposits are held in separate designated deposit
accounts and are thus not treated as assets of the Company in the financial statements. All income is
derived in the United Kingdom.
Taxation
The tax expense represents the sum of the tax currently payable and deferred tax. Current tax is the
expected tax payable on the taxable income for the year based on the tax rate enacted or substantively
enacted at the reporting date, and any adjustment to tax payable in respect of prior years. Taxable profit
differs from income before tax because it excludes items of income or expense that are deductible in
other years, and it further excludes items that are never taxable or deductible.
Deferred taxation is the tax expected to be payable or recoverable on differences between the carrying
amounts of assets and liabilities in the financial statements and the corresponding tax bases used
in the computation of taxable profits and is accounted for using the statement of financial position
liability method. Deferred tax liabilities are recognised for all taxable temporary differences (including
unrealised gains on revaluation of investment properties) and deferred tax assets are recognised to
the extent that it is probable that taxable profits will be available against which deductible temporary
differences can be utilised.
The Company provides for deferred tax on investment properties by reference to the tax that would be
due on the sale of the investment properties. Deferred tax is calculated at the rates that are expected
to apply in the period when the liability is settled, or the asset is realised. Deferred tax is charged or
credited to Income after Taxation, including deferred tax on the revaluation of investment property.
Trade and Other Accounts Receivable
Trade and other receivables are initially measured at the operating lease measurement value and
subsequently measured at amortised cost as reduced by appropriate allowances for expected credit
losses. All receivables do not carry any interest and are short term in nature.
– 34 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
Cash and Cash Equivalents
Cash comprises cash at bank and on demand deposits. Cash equivalents are short term (less than three
months from inception), repayable on demand and are subject to an insignificant risk of change in
value.
Trade and Other Accounts Payable
Trade and other payables are initially measured at fair value and subsequently measured at amortised
cost. All trade and other accounts payable are non-interest bearing.
Pensions
Pension contributions towards the employee’s pension plan are charged to the statement of
comprehensive income as incurred. The pension scheme is a defined contribution scheme.
Borrowings
Interest rate borrowings are initially recognised at fair value, being proceeds received less any directly
attributable transaction costs. Borrowings are subsequently stated at amortised cost. Any difference
between the proceeds (net of transaction costs) and the redemption value is recognised in profit or loss
over the period of the borrowings using the effective interest method. Borrowings are classified as
current liabilities unless the Company has an unconditional right to defer settlement of the liability for
at least 12 months after the reporting date.
Dilapidations
Dilapidations receipts are recognised in the Statement of Comprehensive Income when the right to
receive them arises. They are recorded in revenue as other property income unless a property has been
agreed to be sold whereby the receipt is treated as part of the proceeds of sale of the property. See Note 2.
1.3
Key Sources of Estimation Uncertainty and Judgements
The preparation of the financial statements requires management to make judgements, estimates and
assumptions that may affect the application of accounting policies and the reported amounts of assets
and liabilities, income and expenses.
Revisions to accounting estimates are recognised in the period in which the estimate is revised if the
revision affects only that period. The key sources of estimation uncertainty that have a significant
risk of causing material adjustment to the carrying amounts of assets and liabilities within the next
financial year are those relating to the fair value of investment properties which are revalued annually
by the Directors having taken advice from the Company’s independent external valuers, on the basis
described in Note 10, as well as the judgement taken by the Directors as to whether a property is being
held for sale.
There are no other judgemental areas identified by management that could have a material effect on the
financial statements at the reporting date.
2. PROPERTY INCOME
Rental income
Other property income
2022
£’000
2,252
56
2,308
2021
£’000
2,140
298
2,438
Rental income comprises rents earned and apportioned over the lease period taking into account rent free
periods and rents received during the period. Other property income comprises unexpended dilapidations
and miscellaneous income arising from the letting of properties.
– 35 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
3. PROPERTY COSTS
Empty rates
Property management
Legal fees
Agents fees
4. ADMINISTRATIVE COSTS
Rents payable - short term lease
General administration, including staff costs
Auditors’ remuneration - audit fees CLA Evelyn Partners Limited
(formerly Nexia Smith & Williamson)
Auditors’ remuneration - audit fees BDO
Tax services - BDO
Tax services - Associate of Nexia Smith & Williamson
5. STAFF COSTS
Staff costs, including Directors’ fees, during the year were as follows:
Wages and salaries
Social security costs
Other pension costs
2022
£’000
3
65
68
34
23
125
2022
£’000
32
548
31
–
–
3
614
2022
£’000
289
34
13
336
2021
£’000
47
176
223
21
11
255
2021
£’000
28
522
–
38
5
–
593
2021
£’000
278
32
13
323
Further details of Directors’ emoluments, totalling £302,530 (2021: £290,796), are shown in the Directors’
Report. There are no other key management personnel.
The average number of employees, including Non-Executive Directors,
engaged wholly in management and administration was:
The number of Directors for whom the Company paid pension benefits
during the year was
2022
No.
5
1
2021
No.
5
1
– 36 –
– 37 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
6. FINANCE COSTS (NET)
Interest payable and finance costs on bank loans
Less: Bank interest receivable
7. TAXATION
(a) Analysis of the tax charge for the year:
UK Corporation tax at 19% (2021: 19%)
Total current tax charge
Deferred tax – temporary differences
Tax charge for the year
(b) Factors affecting the tax charge for the year:
Net Income before taxation
Current Year:
Corporation tax thereon at 19% (2021: 19%)
Capital gains net tax movement on disposals
Deferred tax adjustment for change to 25% tax rate (2021: 19%)
Deferred tax net adjustments arising from revaluation of properties
Total tax charge for the year
8. DIVIDENDS
Final dividend paid in year of 13.0p per share
(2021: Second Interim dividend 7.5p per share)
Interim dividend paid in year of 8.5p per share
(2021: Interim dividend 8.0p per share)
2022
£’000
379
–
379
2022
£’000
292
1,492
1,784
7,202
1,368
106
467
(157)
1,784
2022
£’000
352
231
583
2021
£’000
412
(1)
411
2021
£’000
249
146
395
4,048
769
(187)
–
(187)
395
2021
£’000
203
216
419
On 15 June 2022 the Board resolved to pay a final dividend of 14p per share which will be recorded in the
Financial Statements for the year ending 25 March 2023.
– 37 –
– 37 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
9. EARNINGS PER SHARE
Basic earnings per share are calculated by dividing Income after Taxation attributable to Ordinary
Shareholders of £5,356,000 (2021: £3,653,000) by the weighted average number of 2,711,617 (2020:
2,711,617) ordinary shares in issue during the period excluding shares held as treasury. There are no
instruments in issue that would have the effect of diluting earnings per share.
10. INVESTMENT PROPERTIES
Properties
Balance at beginning of financial year
Additions
Disposals
Revaluation Surplus
Balance at end of financial year
2022
£’000
34,005
1,583
(2,500)
5,887
38,975
2021
£’000
34,260
117
(2,120)
1,748
34,005
The Company’s freehold properties were valued as at 25 March 2022 by BNP Paribas Real Estate, Chartered
Surveyors, acting in the capacity of external valuers, and adopted by the Directors. The valuations were
undertaken in accordance with the requirements of IFRS 13 and the RICS Valuation – Global Standards
2020.
The valuation of each property was on the basis of Fair Value. The valuers reported that the total aggregate
Fair Value of the properties held by the Company was £38,975,000.
The valuer’s opinions were primarily derived from comparable recent market transactions on arms-length
terms.
In the financial year ending 25 March 2022, the total fees earned by the valuer from Wynnstay Properties
PLC and connected parties were less than 5% of the valuer’s Company turnover.
The valuation complies with International Financial Reporting Standards. The definition adopted by the
International Accounting Standards Board (IASB) in IFRS 13 is Fair Value, defined as: ‘The price that
would be received to sell an asset, or paid to transfer a liability, in an orderly transaction between market
participants at the measurement date.’
These recurring fair value measurements for non-financial assets use inputs that are not based on observable
market data, and therefore fall within level 3 of the fair value hierarchy.
The significant unobservable market data used is property equivalent yields which range from 4.3% to 8.5%,
with an average equivalent yield of 6.2% (2021: 6.7%) and an average weighted equivalent yield of 6.25%
(2021: 6.38%) for the portfolio.
There have been no transfers between levels of the fair value hierarchy. Movements in the fair value are
recognised in profit or loss.
A 0.5% decrease in the weighted equivalent yield would result in a corresponding increase of £3.81 million
in the fair value movement through profit or loss. A 0.5% increase in the same yield would result in a
corresponding decrease of £3.19 million in the fair value movement through profit or loss.
– 38 –
– 39 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
11. OPERATING LEASES RECEIVABLE
The following are the future minimum lease
payments receivable under non-cancellable
operating leases which expire:
Not later than one year
Between 1 and 5 years
Over 5 years
2022
£’000
354
4,753
622
5,729
2021
£’000
391
3,519
1,710
5,620
Rental income under operating leases recognised through profit or loss amounted to £2,252,000 (2021:
£2,140,000).
Typically, the properties were let for a term of between 5 and 10 years at a market rent with rent reviews
every 5 years. The above maturity analysis reflects future minimum lease payments receivable to the next
break clause in the operating lease. The properties are generally leased on terms where the tenant has the
responsibility for repairs and running costs for each individual unit with a service charge payable to cover
common services provided by the landlord on certain properties. The Company manages the services
provided for a management fee and the service charges are not recognised as income in the accounts of the
Company as any receipts are netted off against the associated expenditures with any residual balance being
shown as a liability.
If the tenant does not carry out its responsibility for repairs and the Company receives a dilapidations
payment, the resulting cash is recorded in revenue as other property income unless a property has been
agreed to be sold where the receipt is treated as part of the proceeds of sale of the property. See Note 2.
12. INVESTMENTS
Quoted investments
13. SUBSIDIARY COMPANY
2022
£’000
3
2021
£’000
3
The Company has the following dormant subsidiary which the Directors consider immaterial to, and thus
has not been consolidated into, the financial statements. The subsidiary holds the legal title to an access road
to an investment property, the use of which is shared between the Company, its tenants at the property and
neighbouring premises.
Scanreach Limited 80% owned Dormant Net Assets: £4,447 (2021: £4,447)
– 39 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
14. ACCOUNTS RECEIVABLE
Trade receivables
Other receivables
2022
£’000
215
86
301
2021
£’000
322
20
342
Trade receivables include an adjustment for credit losses of £nil (2021: £6,282). Trade receivables of £nil
(2021: nil) are considered past due, but not impaired.
15. ACCOUNTS PAYABLE
Trade payables
Other creditors
Deferred income
Accruals
16. BANK LOANS PAYABLE
Current loan
Non–current loan
2022
£’000
7
84
535
422
1,048
2022
£’000
–
9,938
9,938
2021
£’000
28
65
535
301
929
2021
£’000
10,000
–
10,000
In December 2021, a five-year Fixed Rate Facility of £10 million and a Revolving Credit Facility of £5.0
million were entered into providing a total committed credit facility of £15.0 million. Interest on loan
amounts drawn down under the Fixed Rate Facility of £10 million (2021: £10 million) is charged at 3.61%
per annum (2021: 3.35%) for the year ended 25 March 2022. No loan amounts have been drawn down under
the Revolving Credit Facility during the year and the balance drawn as at 25 March 2022 is £nil (2021: £nil).
Both facilities are repayable in one instalment on 17 December 2026. The facilities include the following
financial covenants which were complied with during the year:
• Rental income shall not be less than 2.25 times the interest costs
• The drawn balance shall at no time exceed 50% of the market value of the properties secured.
The facilities are secured by fixed charges over freehold land and buildings owned by the Company, which
at the year-end had a combined value of £35,330,000 (2021: £33,185,000). The undrawn element of the
facilities available at 25 March 2022 was £5,000,000 (2021: £3,500,000).
Interest charged under the Revolving Credit Facility is linked to Bank of England Base Rate as the reference
rate.
– 40 –
– 41 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
17. DEFERRED TAX
Deferred Tax brought forward
Charge for the year
Deferred Tax carried forward
2022
£’000
461
1,492
1,953
2021
£’000
314
147
461
A deferred tax liability of £1,953,000 (2021: £461,000) is recognised in respect of the investment properties and
has been calculated at a tax rate of 25% (2021: 19%).
18. SHARE CAPITAL
Authorised
8,000,000 Ordinary Shares of 25p each:
Allotted, Called Up and Fully Paid
3,155,267 Ordinary shares of 25p each:
2022
£’000
2021
£’000
2,000
2,000
789
789
All shares rank equally in respect of shareholder rights.
In March 2010, the Company acquired 443,650 Ordinary shares of Wynnstay Properties PLC from Channel
Hotels and Properties Ltd at a price of £3.50 per share. These shares, representing in excess of 14% of
the total shares in issue, are held in Treasury. As a result, the total number of shares with voting rights is
2,711,617.
19. FINANCIAL INSTRUMENTS
The objective of the Company’s policies is to manage the Company’s financial risk, secure cost-effective
funding for the Company’s operations and minimise the adverse effects of fluctuations in the financial
markets on the value of the Company’s financial assets and liabilities, on reported profitability and on the
cash flows of the Company.
At 25 March 2022 the Company’s financial instruments comprised borrowings, cash and cash equivalents,
short term receivables and short-term payables. The main purpose of these financial instruments was to raise
finance for the Company’s operations. Throughout the period under review, the Company has not traded in
any other financial instruments. The Board reviews and agrees policies for managing each of the associated
risks and they are summarised below:
Credit Risk
The risk of financial loss due to a counterparty’s failure to honour its obligations arises principally in
connection with property leases and the investment of surplus cash.
– 41 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
19. FINANCIAL INSTRUMENTS (Continued)
Tenant rent payments are monitored regularly, and appropriate action is taken to recover monies owed or,
if necessary, to terminate the lease. The Company carefully vets prospective new tenants from a credit risk
perspective. Bad debts are mitigated by close engagement with tenant businesses within a well-diversified
mix of some 77 tenancies across the portfolio and close monitoring of rental income receipts. In the light
of the Covid-19 pandemic the Company has regularly reviewed the portfolio, including feedback from
engagement with tenants, in order to assess the risk of tenant failures.
The Company has no significant concentration of credit risk associated with trading counterparties
(considered to be over 5% of net assets) with exposure spread over a large number of tenancies. In terms of
concentration of individual tenant’s rents versus total gross annual passing rents the Company has 3 tenants
whose rent, on an individual basis, is between 5.0% and 7.3% of total gross annual passing rents.
Funds are invested and loan transactions contracted only with banks and financial institutions with a high
credit rating. Concentration of credit risk exists to the extent that as at 25 March 2022 and 2021 current
account and short–term deposits were held with two financial institutions, Handelsbanken PLC and C Hoare
& Co. The combined exposure to credit risk on cash and cash equivalents at 25 March 2022 was £3,491,000
(2021: £2,001,000).
Currency Risk
As all of the Company’s assets and liabilities are denominated in Pounds Sterling, there is no exposure to
currency risk.
Interest Rate Risk
The Company is exposed to interest rate risk that could affect cash flow as it currently borrows at both
floating and fixed interest rates. The Company monitors and manages its interest rate exposure on a periodic
basis, but does not take out financial instruments to mitigate the risk. The Company finances its operations
through a combination of retained profits and bank borrowings.
Liquidity Risk
The Company seeks to manage liquidity risk to ensure sufficient funds are available to meet the requirements
of the business and to invest cash assets safely and profitably. The Board regularly reviews available cash to
ensure there are sufficient resources for working capital requirements.
Interest Rate Sensitivity
Financial instruments affected by interest rate risk include loan borrowings and cash deposits. The analysis
below shows the sensitivity of the statement of comprehensive income and equity to a 0.5% change in
interest rates:
Impact on interest payable – gain/(loss)
Impact on interest receivable – (loss)/gain
Total impact on pre-tax profit and equity
0.5% decrease
in interest rates
0.5% increase
in interest rates
2022
£'000
–
(17)
(17)
2021
£'000
–
(10)
(10)
2022
£'000
–
17
17
2021
£'000
–
10
10
– 42 –
– 43 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
19. FINANCIAL INSTRUMENTS (Continued)
The calculation of the net exposure to interest rate fluctuations was based on the following as at 25 March:
Floating rate borrowings (bank loans)
Less: cash and cash equivalents
2022
£'000
–
3,491
3,491
2021
£'000
–
2,001
2,001
Fair Value of Financial Instruments
Except as detailed in the following table, management consider the carrying amounts of financial assets and
financial liabilities recognised at amortised cost approximate to their fair value.
Interest bearing borrowings (note 16)
2022
Book Value
£’000
(9.938)
2022
Fair Value
£’000
(9,938)
2021
Book Value
£’000
(10,000)
2021
Fair Value
£’000
(10,000)
Total
(9,938)
(9,938)
(10,000)
(10,000)
Categories of Financial Instruments
Financial assets:
Quoted investments measured at fair value
Loans and receivables measured at amortised cost
Cash and cash equivalents measured at amortised cost
Total financial assets
Financial liabilities at amortised cost
Total liabilities
Shareholders’ equity
Total shareholders’ equity and liabilities
2022
£’000
3
301
3,491
3,795
10,451
13,223
29,547
42,770
2021
£’000
3
342
2,001
2,346
10,628
11,639
24,712
36,351
The only financial instruments measured subsequent to initial recognition at fair value as at 25 March are quoted
investments. These are included in level 1 in the IFRS 13 fair value hierarchy as they are based on quoted prices
in active markets
– 43 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
19. FINANCIAL INSTRUMENTS (Continued)
Capital Management
The primary objectives of the Company’s capital management are:
•
•
to safeguard the Company’s ability to continue as a going concern, so that it can continue to provide
returns for shareholders: and
to enable the Company to respond quickly to changes in market conditions and to take advantage of
opportunities.
Capital comprises shareholders’ equity plus net borrowings. The Company monitors capital using loan to
value and gearing ratios. The former is calculated by reference to total debt as a percentage of the year end
valuation of the investment property portfolio. Gearing ratio is the percentage of net borrowings divided
by shareholders’ equity. Net borrowings comprise total borrowings less cash and cash equivalents. The
Company’s policy is that the net loan to value ratio should not exceed 50% and the gearing ratio should not
exceed 100%.
Loans and overdraft
Cash and cash equivalents
Net borrowings
Shareholders’ equity
Investment properties
Loan to value ratio
Net borrowings to value ratio
Gearing ratio
2022
£'000
9,938
(3,491)
6,447
29,547
38,975
25.5%
16.5%
21.8%
2021
£'000
10,000
(2,001)
7,999
24,712
34,005
29.4%
23.5%
32.4%
20. RELATED PARTY TRANSACTIONS
Related Party Transactions with the Directors have been disclosed under Directors’ Emoluments in the
Directors’ Report on page 22. There were no other Related Party Transactions during the year (2021: £nil).
– 44 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
21. SEGMENTAL REPORTING
Industrial
Retail
Office
Total
2022
2021
2022
2021
2022
2021
2022
2021
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
1,884
1,676
56
298
5,872
2,093
68
–
40
140
–
50
300
–
324
2,252
–
56
(25)
(395)
5,887
2,140
298
1,748
Rental Income
Other Property Income
Profit /(Loss) on investment
property at fair value
Total income and gain
7,812
4,067
108
190
275
(71)
8,195
4,186
Property expenses
(125)
(215)
–
(5)
–
(35)
(125)
(255)
Segment profit/(loss)
7,687
3,852
108
185
275
(106)
8,070
3,931
Unallocated corporate
expenses
Profit on sale of
investment property
Operating income
Interest expense (all relating
to property loans)
Interest income and
other income
Income before taxation
(614)
(593)
125 1,121
7,581 4,459
(379)
(412)
–
1
7,202 4,048
Other information
Industrial
Retail
Office
Total
2022
2021
2022
2021
2022
2021
2022
2021
£’000
£’000
£’000
£’000
£’000
£’000
£’000
£’000
Segment assets
36,655 29,200 1,010
970
1,310
3,835
38,975
34,005
Segment assets held
as security
33,010 28,380 1,010 970 1,310 3,835 35,330 33,185
– 45 –
NOTES TO THE FINANCIAL STATEMENTS FOR THE YEAR ENDED 25 MARCH 2022
WYNNSTAY PROPERTIES PLC
22. CAPITAL COMMITMENTS
Significant capital expenditure contracted for at the end of the financial year, but not recognised as liabilities
in the financial statements is: £nil (2021: £1,518,000).
– 46 –
– 47 –
WYNNSTAY PROPERTIES PLC
FIVE YEAR FINANCIAL REVIEW
Years Ended 25 March:
2022
£’000
2021
£’000
2020
£’000
2019
£’000
2018
£’000
STATEMENT OF COMPREHENSIVE INCOME
Property Income
Net Property Income
Operating Income
Income before Taxation
Income after Taxation
2,308
1,569
7,591
7,202
5,418
2,438
1,590
4,459
4,048
3,653
2,271
1,583
686
258
123
2,216
1,591
2,642
2,247
1,928
2,182
1,514
3,355
2,991
2,632
STATEMENT OF FINANCIAL POSITION
Investment Properties
Equity Shareholders’ Funds
38,975
29,547
34,005
24,712
34,260
21,478
35,095
21,883
30,070
20,443
PER SHARE
Basic earnings
Dividends Paid and Proposed
Net Asset Value
199.8p
22.5p
1,090p
134.7p
21.0p
911p
4.5p
15.0p
792p
71.1p
19.0p
807p
97.1p
17.5p
754p
– 47 –
– 47 –
WYNNSTAY PROPERTIES PLC
NOTICE OF ANNUAL GENERAL MEETING
We are delighted to be able to welcome shareholders to the AGM this year. All shareholders are encouraged
to exercise their voting rights in relation to the resolutions set out in the Notice of Meeting below by
appointing either the Chairman of the meeting or another person as their proxy. A form of proxy is enclosed
on which there are notes for completion. Shareholders intending to attend the meeting in person should tick
the box on the proxy form.
Shareholders attending the meeting will be required to comply with the requirements of The Royal Automobile
Club for entry, including with its dress code which can be found at https://www.royalautomobileclub.co.uk/
pall-mall/visiting-pall-mall/pall-mall-dress-code/
Shareholders who have registered for Link services online can also benefit from the ability to cast their proxy
votes electronically, rather than by post. Shareholders not already registered for Link services online will need
their investor code, which can be found on their share certificate or dividend tax voucher, in order to register.
If you need help with voting online, please contact our Registrars, Link Group on Tel: 0371 664 0391.
Calls are charged at the standard geographic rate and will vary by provider. Calls outside the United
Kingdom will be charged at the applicable international rate. Lines are open between 09:00 – 17:30,
Monday to Friday (excluding public holidays in England and Wales). You can also contact them by email at
shareholderenquiries@linkgroup.co.uk
NOTICE IS HEREBY GIVEN that the one hundred and thirty sixth ANNUAL GENERAL MEETING of the
Members of Wynnstay Properties PLC will be held at The Royal Automobile Club, 89 Pall Mall, London,
SW1Y 5HS on Tuesday, 19 July 2022, at 2.30 p.m. The business of the meeting will be to consider and, if
thought fit, to pass the following ordinary and special resolutions.
ORDINARY RESOLUTIONS
1 To receive the Report of the Directors and the Financial Statements for the year ended 25 March 2022.
2 To declare a final dividend for the year ended 25 March 2022 of 14 pence per ordinary share.
3 To fix the remuneration of the Directors.
4 To appoint CLA Evelyn Partners Limited as auditors of the Company, to hold office from the conclusion
of the annual general meeting until the conclusion of the next annual general meeting of the Company and
to authorise the Directors to determine their remuneration.
5 To re-elect Mr. P. G. H. Collins as a Director of the Company, who retires and offers himself for
re-election.
6 To re-elect Mr P. Mather as a Director of the Company, who retires and offers himself for re-election.
7 That the Directors of the Company are generally and unconditionally authorised for the purposes of
section 551 of the Companies Act 2006 (the “Act”), in substitution for all previous authorisations, to
exercise all the powers of the Company to allot shares in the Company and to grant rights to subscribe
for or convert any security into shares in the Company (“Rights”) up to an aggregate nominal amount
of £39,440.75, and this authorisation shall, unless previously revoked by resolution of the Company,
expire on 31 December 2023 or, if earlier, at the conclusion of the annual general meeting of the
Company to be held in 2023. The Company may, at any time before such expiry, make offers or enter into
agreements which would or might require shares to be allotted or Rights to be granted after such expiry
and the Directors may allot shares or grant Rights in pursuance of any such offer or agreement as if this
authorisation had not expired.
– 48 –
WYNNSTAY PROPERTIES PLC
NOTICE OF ANNUAL GENERAL MEETING
SPECIAL RESOLUTION
8 That the Directors of the Company are empowered (i) pursuant to section 570 of the Act to allot equity
securities (within the meaning of section 560 of the Act) for cash pursuant to the authorisation conferred
by Resolution 7 above and (ii) pursuant to section 573 of the Act to allot equity securities (within the
meaning of section 560(3) of the Act), in each case as if section 561 of the Act did not apply to the
allotment, provided that this power shall be limited to:
(a) the allotment of equity securities in connection with an offer of, or invitation to apply for, equity
securities made (i) to holders of ordinary shares in the Company in proportion (as nearly as many
as practicable) to the respective number of ordinary shares held by them on the record date for such
offer and (ii) to holders of other equity securities as may be required by the rights attached to those
securities or, if the Directors consider it desirable, as may be permitted by such rights, but subject in
each case to such exclusions or other arrangements as the Directors may deem necessary or expedient
in relation to treasury shares, fractional entitlements, record dates or legal or practical problems in or
under the laws of any territory or the requirements of any regulatory body or stock exchange; and
(b) the allotment (otherwise than pursuant to paragraph (a) above) of further equity securities up to any
aggregate nominal amount of £39,440.75,
and this power shall, unless previously revoked by resolution of the Company, expire on 31 December
2023 or, if earlier, at the conclusion of the annual general meeting of the Company to be held in 2023. The
Company may, at any time before the expiry of this power, make offers or enter into agreements which
would or might require equity securities to be allotted after such expiry and the Directors may allot equity
securities in pursuance of any such offer or agreement as if this power had not expired.
Registered Office:
Hamilton House
Mabledon Place
London WC1H 9BB
By Order of the Board
Susan Wallace
Secretary
15 June 2022
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– 49 –
WYNNSTAY PROPERTIES PLC
NOTICE OF ANNUAL GENERAL MEETING
Notes to the Notice of Annual General Meeting
1.
2.
3.
4.
5.
6.
Pursuant to Regulation 41 of the Uncertificated Securities Regulations 2001, the Company specifies
that only those shareholders registered in the relevant register of securities by close of business on
15 July 2022 or, in the event that the Annual General Meeting is adjourned, in the relevant register of
securities 48 hours (disregarding any non-working days) before the time of any adjourned meeting shall
be entitled to attend and vote in respect of the number of Ordinary Shares registered in their name at the
relevant time. Changes to entries in the relevant register of securities after close of business on 15 July
2022 or, in the event that the Annual General Meeting is adjourned, less than 48 hours (disregarding
any days which are non-working days) before the time of any adjourned meeting, shall be disregarded
in determining the rights of any person to attend or vote at the Annual General Meeting.
If you are a member of the Company at the time set out in note 1 above, you are entitled to appoint a
proxy to exercise all or any of your rights to attend, speak and vote at the Annual General Meeting and
you should have received a proxy form with this notice of meeting. You can only appoint a proxy using
the procedures set out in these notes and the notes to the proxy form.
To appoint a proxy using the proxy form, the form must be completed and signed and returned to the
Company’s registrars, Link Group, at PXS 1, Central Square, 29 Wellington Street, Leeds, LS1 4DL
so as to be received not later than 48 hours before the time appointed for holding the Annual General
Meeting.
Alternatively, a shareholder may appoint a proxy online by following the instructions for the electronic
appointment of a proxy at: www.signalshares.com. To be a valid proxy appointment, the shareholder’s
electronic message confirming the details of the appointment completed in accordance with those
instructions must be transmitted so as to be received by no later than 48 hours before the time fixed for
holding the adjourned meeting.
CREST members who wish to appoint one or more proxies through the CREST system may do so
by using the procedures described in “the CREST voting service” section of the CREST Manual.
CREST personal members or other CREST sponsored members, and those CREST members who have
appointed one or more voting service providers, should refer to their CREST sponsor or voting service
provider(s), who will be able to take the appropriate action on their behalf.
In order for a proxy appointment or a proxy instruction made using the CREST voting service to be
valid, the appropriate CREST message (CREST proxy appointment instruction) must be properly
authenticated in accordance with the specifications of CREST’s operator, Euroclear UK & International
Limited (Euroclear), and must contain all the relevant information required by the CREST Manual.
To be valid, the message (regardless of whether it constitutes the appointment of a proxy or is an
amendment to the instruction given to a previously appointed proxy) must be transmitted so as to
be received by Link Group (ID RA10), as the Company’s “issuer’s agent”, by 2.30 p.m. on 15 July
2022. After this time any change of instruction to a proxy appointed through the CREST system
should be communicated to the appointee through other means. The time of receipt of the message
will be taken to be when (as determined by the timestamp applied by the CREST Applications Host)
the issuer’s agent is first able to retrieve it by enquiry through the CREST system in the prescribed
manner. Euroclear does not make available special procedures in the CREST system for transmitting
any particular message. Normal system timings and limitations apply in relation to the input of CREST
proxy appointment instructions.
7.
It is the responsibility of the CREST member concerned to take (or, if the CREST member is a CREST
personal member or a CREST sponsored member or has appointed any voting service provider(s), to
procure that his CREST sponsor or voting service provider(s) take(s)) such action as is necessary to
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– 51 –
WYNNSTAY PROPERTIES PLC
NOTICE OF ANNUAL GENERAL MEETING
ensure that a message is transmitted by means of the CREST system by any particular time. CREST
members and, where applicable, their CREST sponsors or voting service providers should take into
account the provisions of the CREST Manual concerning timings as well as its section on “Practical
limitations of the system”. In certain circumstances the Company may, in accordance with the
Uncertificated Securities Regulations 2001 or the CREST Manual, treat a CREST proxy appointment
instruction as invalid.
8.
9.
10.
11.
A proxy does not need to be a member of the Company but must attend the Annual General Meeting to
represent you. Details of how to appoint the chairman of the meeting or another person as your proxy
using the proxy form are set out in the notes to the proxy form.
You may appoint more than one proxy provided each proxy is appointed to exercise rights attached to
different shares. You may not appoint more than one proxy to exercise rights attached to any one share.
The notes to the proxy form explain how to direct your proxy how to vote on each resolution or
withhold their vote.
In the case of joint holders, where more than one of the joint holders purports to appoint a proxy, only
the appointment submitted by the most senior holder will be accepted. Seniority is determined by the
order in which the names of the joint holders appear in the Company’s register of members in respect of
the joint holding (the first-named being the most senior).
12. Appointment of a proxy does not preclude you from attending the Annual General Meeting and voting
in person. If you have appointed a proxy and attend the Annual General Meeting in person, your proxy
appointment will automatically be terminated.
13.
14.
15.
To change your proxy instructions simply submit a new proxy appointment using the methods set out
above. Note that the cut off time for receipt of proxy appointments (see above) also applies in relation
to amended instructions; any amended proxy appointment received after the relevant cut-off time will
be disregarded.
If you submit more than one valid proxy appointment, the appointment received last before the latest
time for the receipt of proxies will take precedence.
In order to facilitate voting by corporate representatives at the Annual General Meeting, arrangements
will be put in place at the Annual General Meeting so that:
15.1. Where a corporate shareholder has appointed one or more corporate representatives (other than
the chairman of the Annual General Meeting) then:
15.1.1 on a vote on a resolution on a show of hands, each such corporate representative has the
same voting rights as the corporation would be entitled to; but
15.1.2 in respect of any purported exercise of power other than on a vote on a resolution on a
show of hands, where more than one corporate representative purports to exercise such
power in respect of the same shares, if they purport to exercise the power in the same way
as each other, the power is treated as exercised in that way but if they do not purport to
exercise the power in the same way as each other, the power is treated as not exercised.
16. As at 15 June 2022 (being the last practicable date prior to the publication of this notice), the
Company’s issued share capital consisted of 3,155,267 Ordinary Shares, carrying one vote per share,
of which 443,650 shares are held by the Company in treasury. Therefore, the total voting rights in the
Company as at 15 June 2022 were 2,711,617.
– 51 –
WYNNSTAY PROPERTIES PLC
BIOGRAPHIES OF THE DIRECTORS
Philip Collins (Non-Executive Chairman) aged 74, is a Solicitor and was Chairman of the Office of Fair
Trading from 2005 to 2014. He was formerly a partner in an international firm based in the City where he
specialised in E.U. law, with particular emphasis on competition issues. Previously, after practising for some
years in the corporate and commercial field, he was seconded for a period to work as Chief Legal Adviser in
an industrial group. Appointed a Director of Wynnstay Properties in 1988 and elected Chairman in October
1998.
Paul Williams (Managing Director) aged 64 is a Chartered Surveyor and holds a Degree in Land
Management as well as an MBA. He has spent his entire career in commercial property including a fourteen-
year period with MEPC where he held a number of senior positions. Paul has also worked for Lloyds TSB,
Legal & General, GE Pensions and Credit Suisse Asset Management and joined Wynnstay Properties as
Managing Director in February 2006.
Charles H. Delevingne (Non-Executive) aged 72. After spending his early career as a partner with prominent
estate agencies, in 1981 he founded Harvey White Properties Limited, a substantial private commercial
property investment company. Appointed a Director of Wynnstay Properties in June 2002.
Paul Mather (Non-Executive) aged 67 is a Chartered Surveyor who has spent his career focused on active
asset management of commercial portfolios and developments in central London. He was a senior director at
BNP Paribas Real Estate for 13 years and group portfolio manager for Greycoat PLC for 17 years. Appointed
a director of Wynnstay Properties in March 2017.
Caroline Tolhurst (Non-Executive and Senior Independent Director) aged 60, is a Chartered Surveyor and
a Chartered Secretary with more than 30 years’ experience in property and investment sectors. She was
Company Secretary at Grosvenor Limited and NewRiver Retail Limited and compliance officer for Knight
Frank LLP’s regulated businesses. She is also a Board member and Committee Chair at A2Dominion Housing
Group Limited and LocatED Property Limited. Appointed a director of Wynnstay Properties in March 2017.
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– 52 –
– PB –