RNS Number : 0685B
Parity Group PLC
29 September 2022
 

PARITY GROUP PLC

INTERIM RESULTS FOR THE SIX MONTHS TO 30 JUNE 2022

 

29 September 2022

 

Parity Group plc ("Parity" or the "Group"), the data and technology focused professional services business, announces its half year results for the six months ended 30 June 2022 ("H1 2022").

Headlines

·    Net fee income (NFI) 9% higher against H2 2021.

·    The first time in more than three years that the business has increased NFI in sequential reporting periods.

·    Adjusted EBITDA(1) for H1 2022 of £0.3m.

·    Operating profit of £0.1m.

·    Improved operating performance in H1 2022 following actions taken to refocus the business and streamline the cost base during the prior year.

 

Key P&L Financials

For the six months ended 30 June 2022

 


Six months

to 30.06.22
(Unaudited)

£'000

Six months

to 30.06.21

(Unaudited)

£'000

Year

to 31.12.21

(Audited)

         £'000

Revenue

21,055

25,998

46,962

Net fee income

1,917

2,322

4,080

Adjusted EBITDA1

305

192

127

Operating profit/(loss) before non-underlying items

101

18

(269)

Adjusted loss before tax1

(59)

(91)

(550)

Loss before tax

(82)

(491)

(1,103)

 

1 Adjusted EBITDA and adjusted loss before tax are non-IFRS alternative performance measures, defined in Note 1 of the notes to the interim results.

 

 

 

 

Mark Braund, Executive Chairman of Parity Group plc, said:

"Having successfully rebuilt the core recruitment business platform within Parity, we are beginning to see this capability make a positive impact on the performance of the business.

During the period, we materially improved customer relationships alongside the size and quality of Parity's virtual bench of skilled technology contractors, re-establishing it as one of the best of its kind addressing the public sector market.  With improvements in mobility and skills transfer, Parity's access to these skilled resources will be increasingly valuable as we focus more of our attention on the commercial (private) sector.

The balance of the year is focused on maintaining our positive momentum and positioning the business for further growth in 2023."

 

 

Contacts

 

 

Parity Group PLC

www.parity.net

Mark Braund, Executive Chairman

Mike Johns, CFO

+ 44 (0) 208 171 1729

 

 

Allenby Capital Limited (Nominated Adviser and Broker)


David Hart / Freddie Wooding (Corporate Finance)

Tony Quirke (Sales and Corporate Broking)

+44 (0) 20 3328 5656

 

This announcement contains certain statements that are or may be forward-looking with respect to the financial condition, results or operations and business of Parity Group plc. By their nature forward-looking statements involve risk and uncertainty because they relate to events and depend on circumstances that will occur in the future. There are a number of factors that could cause actual results and developments to differ materially from those expressed or implied by such forward-looking statements. These factors include, but are not limited to (i) adverse changes to the current outlook for the UK IT recruitment and solutions market, (ii) adverse changes in tax laws and regulations, (iii) the risks associated with the introduction of new products and services, (iv) pricing and product initiatives of competitors, (v) changes in technology or consumer demand, (vi) the termination or delay of key contracts and (vii) volatility in financial markets.

Overview

H1 2022 has been a period of stabilisation and development for the Group. After realigning the strategy around its core recruitment competencies in the second half of 2021, the Group has re-established a stable platform for the business and in doing so has successfully delivered upon its first objective since refocusing on recruitment services, with a return to profitability at both Adjusted EBITDA and Operating profit levels during the period.

The Group has also seen 9% growth in net fee income against H2 2021.

In H1 2022, the Group has established a new permanent recruitment team and added to its investment in new business capability. Returns from these investments are expected to start to be seen during the second half of 2022 and into 2023. Parity will continue to invest in frontline resources to support growth including in areas where there is an opportunity to develop higher margin business utilising Parity's access to high value scarce resources.

Despite the current economic conditions and uncertainties, the contract recruitment market and, in particular, the public sector continue to be resilient with high demand for skilled resources in the Group's key areas of expertise (technology, data, and transformation) driving up billing rates and margins.

With public sector recruitment predominantly delivered through framework agreements, the Group is once again working with public sector procurement bodies to tender for new and existing multiyear frameworks. With 18 tenders so far this year, the Group has to date been successful with nine and is awaiting the outcome from four that will come later in the year/early in 2023. The new frameworks give Parity access to new clients and roles within the public sector that will support growth in H2 2022 and beyond.

Having achieved its initial goal to refocus around recruitment and demonstrated its ability to deliver this profitably, the Group is now focused on developing new business from both the public and private sectors to drive NFI upwards and delivering an increased bottom line performance.

Financial review

H1 2022 has seen the Group continue its journey to re-establish its focus around recruitment services and headline financial performance for H1 2022 has benefited from the decisions made in H2 2021. The realignment of resources in 2021 has created a lower cost base for the business and, combined with market conditions supporting increased billable rates and the benefit from additional non recruitment revenues in H1, the business has delivered both growth and profitability during H1 2022.

The Group has benefited from continuing demand within the contract recruitment market for skilled resources in the Group's key areas of expertise (technology, data, and transformation) and this has contributed to a modest lift in net fee income. Core recruitment net fee income has increased by 5% over H2 2021 and with the addition of income from other activities, total net fee income for H1 2022 was 9% higher than H2 2021. The increase in net fee income combined with lower costs has enabled the Group to post a positive adjusted EBITDA of £305k for H1 2022 (H1 2021:  £192k, FY 2021: £127k).

Net fee income

Net fee income for H1 2022 was £1.92m. Whilst lower than H1 2021, this represents a 9% increase on Net fee income of £1.76m in H2 2021 and is the first time in more than three years that the business has increased NFI in sequential reporting periods.

NFI for the period from recruitment activities of £1.6m was flat against the second half of FY21. A reduction in average contractors (384 for H1 2022 vs 415 for H1 2021) was offset by an increase in average billable day rate by 4% and higher utilisation during H1 2022.

Non recruitment NFI increased from £264k in H2 2021 to £400k in H1 2022, driving up the total NFI performance. Included within the total NFI for FY22 is £69k of revenue from permanent hires by the new permanent recruitment team. In addition, the negotiation of the conclusion of the BAT contract that ended on 31st March 2022 yielded additional managed service fees during the period.

Operating costs

During H2 2022, the business realigned its costs base, streamlining management and non-recruitment costs, enabling the business to re-invest in its core recruitment activities during H1 2022. The net impact has been a reduction in operating costs to £1.8m, 11% lower than the prior half year and 27% lower than H1 2021.  This reduced cost was achieved despite an investment of £80k during H1 2022 in the development of small permanent recruitment team.

Result before tax

As a result of the actions taken by the Group in the second half of 2021 to realign its costs and focus its activities on recruitment, the Group has been able to reduce its overall cost base and this has enabled it to deliver an adjusted EBITDA of £305k (H1 2021:  £192k, FY 2021: £127k).

During the period, the business incurred £23k of non-underlying costs as a result of the conclusion of a contract with BAT in March 2022.

After the inclusion of non-underlying items, the Group posted a much reduced loss before tax of £82k for H1 2022, compared to a loss before tax of £491k in H1 2021 and £1,103k in FY 2021.

Cash & net debt

Net debt as at 30 June 2022, excluding adjustments for IFRS 16 lease liabilities, was £4.5m (30 June 2021: net debt of £1.1m, 31 December 2021: net debt of £1.1m).

The Group continues to utilise its £9m asset-based lending (ABL) debt facility. The current facility is in place until April 2024 and is secured against billed and unbilled receivables to manage both intra month and inter month movements in working capital. Over the last 15 months since switching the facility to Leumi ABL, the Group has benefited from the increased flexibility the Leumi facility provides.

A short delay in receipt of cash from clients across the period end meant that, at the end of the first half, debtors increased in the period. The increased borrowing reflects only timing differences across the period end and the position was normalised within the first week of July. The Group had no bad debt during the period. After adjusting for the timing difference on debtor payments, a normalised net debt for end of the period would have been £1.9m. This represents an increase of £800k over the position as at 31st December 2021. The increase in net debt can be attributed to:

Adjusted Net Debt movement

£m



31/12 2022

(1.1)

Timing on contractor payments

(0.5)

Deferred VAT repayment

(0.1)

FY21 Exceptional items paid in FY22

(0.1)

Pension

(0.2)

30/06/2022 (Adj. for debtors)

(1.9)

 


Timing of debtor payments

(2.6)

30/06/2022

(4.5)

 

 

 

Defined benefit pension

The final salary pension scheme surplus was £0.8m on 30 June 2022 (30 June 2021: surplus of £1.3m; 31 December 2021: surplus of £1.9m). With volatile investment markets during the period and inflationary pressures, both pension liabilities and pension assets fell over the period. A rise in long dated gilt yields caused both liabilities and LDI funds to fall in value. Growth assets that had been the driver of surpluses in recent periods also fell during the first half.  The net impact has been a fall in the surplus at the end of the period. Despite the fall in the surplus, the scheme remains well positioned and the trustees and Group continue to explore opportunities that would enable a buyout of the scheme in the future and relieve the Group of future obligations for this legacy scheme.

During the period, the Group made £166k of contributions to the pension scheme.

Outlook

Parity is now a much simpler business than it has been for many years and, having focused itself around delivering recruitment solutions, is now well positioned to build long-term value.

The last nine months or so have seen significant change in the make-up, focus and strength of the team.  The enthusiasm, commitment, and tenacity of all my colleagues is at the core of Parity's turnaround. For this and on behalf of the Board, we say a heartfelt "thank you".

The next goal is to leverage Parity's brand and reputation to convert new business opportunities in both contract and permanent and across both public and private sectors, providing a platform for growth and an opportunity to consider other options to enhance shareholder value.

The Group has a strong client base, committed employees, a reputation in the market for providing contractors with rewarding opportunities, and clients with the best resources to deliver upon their technology, data, and transformation projects.

 

 


 

Consolidated condensed income statement

For the six months ended 30 June 2022

 


 

 

 

 

Notes

Six months

to 30.06.22
(Unaudited)

£'000

Six months

to 30.06.21

(Unaudited)

£'000

Year

to 31.12.21

(Audited)

         £'000

Revenue

3

21,054

25,998

46,962

Contractor costs


(19,137)

(23,676)

(42,882)

Net fee income


1,917

2,322

4,080

Operating costs before non-underlying items


(1,816)

(2,304)

(4,349)

Operating profit/(loss) before non-underlying items


101

18

(269)

Non-underlying items

4

(23)

(400)

(553)

Operating profit/(loss)


78

(382)

(822)

Analysed as:


 



Adjusted EBITDA1


305

192

127

Share based payment (charge)/income


(20)

59

64

Depreciation and amortisation


(184)

(233)

(460)

Non-underlying items

4

(23)

(400)

(553)

Finance costs

5

(160)

(109)

(281)

Loss before tax


(82)

(491)

(1,103)

Analysed as:


 



Adjusted loss before tax1


(59)

(91)

(550)

Non-underlying items

4

(23)

(400)

(553)

Tax (charge)/credit

6

(213)

(34)

467

Loss for the period attributable to owners of the parent


(295)

(525)

(636)

 

Loss per share

Basic

Diluted

 

7

7

(0.29p)

(0.29p)

(0.51p)

(0.51p)

(0.62p)

(0.62p)

 

 

All activities comprise continuing operations.

 

1 Adjusted EBITDA and adjusted loss before tax are non-IFRS alternative performance measures, defined in Note 1 of the notes to the interim results.



 

Consolidated condensed statement of comprehensive income

For the six months ended 30 June 2022

 

 

 

Six months

to 30.06.22
(Unaudited)

£'000

Six months

to 30.06.21

(Unaudited)

£'000

Year

to 31.12.21

(Audited)

         £'000

Loss for the period

(295)

(525)

(636)

 

 



Other comprehensive income

 



Items that will never be reclassified to profit or loss

 



Remeasurement of defined benefit pension scheme

(783)

985

1,620

Deferred taxation on remeasurement of defined benefit pension scheme

274

(187)

(567)


 



Other comprehensive income for the period after tax

(509)

 

798

1,053

Total comprehensive income for the period attributable to owners of the parent

(804)

273

417

 


 








 



 

Consolidated condensed statement of changes in equity

For the six months ended 30 June 2022

 

Six months to 30.06.22 (Unaudited)

 

Share

capital

£'000

Share

premium

reserve

£'000

Capital redemption reserve

£'000

Other

reserves

£'000

Retained

earnings

£'000

At 1 January 2022

2,062

33,270

14,319

34,560

(77,184)

7,027

Share options - value of employee services

-

-

-

-

20

20

Transactions with owners

-

-

-

-

20

20

Loss for the period

-

-

-

-

(295)

(295)

Other comprehensive income for the period

-

-

-

-

(509)

(509)

At 30 June 2022

2,062

33,270

14,319

34,560

(77,968)

6,243

 

Six months to 30.06.21 (Unaudited)

 

Share

capital

£'000

Share

premium

reserve

£'000

Capital redemption reserve

£'000

Other

reserves

£'000

Retained

earnings

£'000

At 1 January 2021

2,053

33,244

14,319

34,560

(77,537)

6,639

Share options - value of employee services

-

-

-

-

(59)

(59)

Transactions with owners

-

-

-

-

(59)

(59)

Loss for the period

-

-

-

-

(525)

(525)

Other comprehensive income for the period

-

-

-

-

798

798

At 30 June 2021

2,053

33,244

14,319

34,560

(77,323)

6,853

 

Year to 31.12.21 (Audited)

 

Share

capital

£'000

Share

premium

reserve

£'000

Capital redemption reserve

£'000

Other

reserves

£'000

Retained

earnings

£'000

At 1 January 2021

2,053

33,244

14,319

34,560

(77,537)

6,639

Shares issued in the period

9

26

-

-

-

35

Share options - value of employee services





(64)

(64)

Transactions with owners

9

26

-

-

(64)

(29)

Loss for the year

-

-

-

-

(636)

(636)

Other comprehensive income for the year

-

-

-

-

1,053

1,053

At 31 December 2021

2,062

33,270

14,319

34,560

(77,184)

7,027

 



Consolidated condensed statement of financial position

As at 30 June 2022


Notes

As at

30.06.22

(Unaudited)

£'000

As at

30.06.21

(Unaudited)

£'000

As at

31.12.21

(Audited)

£'000

Assets

Non-current assets


 



Goodwill


4,594

4,594

4,594

Other intangible assets


136

4

84

Property, plant and equipment


13

17

15

Right-of-use assets


97

76

149

Trade and other receivables


-

58

29

Deferred tax assets


557

405

528

Retirement benefit asset

8

1,243

1,280

1,939

Total non-current assets


6,640

6,434

7,338

Current assets


 



Trade and other receivables


7,803

7,733

4,768

Cash and cash equivalents


150

904

1,121

Total current assets


7,953

8,637

5,889

Total assets


14,593

15,071

13,227

Liabilities


 



Current liabilities


 



Loans and borrowings


(4,657)

(2,016)

(2,279)

Lease liabilities


(173)

(147)

(242)

Trade and other payables


(3,478)

(5,895)

(3,608)

Provisions


-

(40)

-

Total current liabilities


(8,308)

(8,098)

(6,129)

Non-current liabilities


 



Lease liabilities


-

(78)

(29)

Provisions


(42)

(42)

(42)

Total non-current liabilities


(42)

(120)

(71)

Total liabilities


(8,350)

(8,218)

(6,200)

Net assets


6,243

6,853

7,027



 



Shareholders' equity


 



Called up share capital


2,062

2,053

2,062

Share premium account


33,270

33,244

33,270

Capital redemption reserve


14,319

14,319

14,319

Other reserves


34,560

34,560

34,560

Retained earnings


(77,968)

(77,323)

(77,184)

Total shareholders' equity


6,243

6,853

7,027



Consolidated condensed statement of cash flows

For the six months ended 30 June 2022

 

 

 

 

 

 

Notes

Six months

to 30.06.22
(Unaudited)

£'000

Six months

to 30.06.21

(Unaudited)

£'000

Year

to 31.12.21

(Audited)

         £'000


 

 



Cash flows from operating activities

 

 



Loss for the period

 

(295)

(525)

(636)

Adjustments for:

 

 



Net finance expense

5

160

109

281

Share-based payment expense/(income)

 

20

(59)

(64)

Income tax charge/(credit)

6

213

34

(467)

Amortisation of intangible assets

 

0

2

3

Shares issued in lieu of Directors fees

 

-

-

35

Depreciation of property, plant and equipment

 

7

6

12

Depreciation and impairment of right-to-use assets

 

177

225

414

Loss on write down of lease assets

 

-

-

31

 

 

282

(208)

(391)

Working capital movements

 

 



(Increase)/decrease in trade and other receivables

 

(3,036)

(1,642)

1,352

(Decrease)/increase in trade and other payables

 

(130)

1,038

(1,249)

Decrease in provisions

 

-

(99)

(139)

Payments to retirement benefit plan

8

(166)

(161)

(322)

Net cash flow used in operating activities

 

(3,050)

(1,072)

(749)

 

 

 



Investing activities

 

 



Purchase of property, plant and equipment


(4)

-

(4)

Development of intangible assets


(54)

-

(81)

Net cash flow used in investing activities

 

(58)

-

(85)


 

 



Financing activities

 

 



Drawdown/(repayment) of finance facility

 

2,377

(925)

(662)

Principal repayment of lease liabilities


(190)

(238)

(490)

Interest paid

5

(50)

(33)

(65)

Net cash from/ (used in) financing activities

 

2,137

(1,196)

(1,217)

 

 

 



Net decrease in cash and cash equivalents

 

(971)

(2,268)

(2,051)

Cash and cash equivalents at the beginning of the period

1,121

3,172

3,172

Cash and cash equivalents at the end of the period

150

904

1,121

 

 

 



 



Notes to the interim results

 

1              Accounting policies

 

Basis of preparation

The condensed interim financial statements comprise the unaudited results for the six months to 30 June 2022 and 30 June 2021 and the audited results for the year ended 31 December 2021. The financial information for the year ended 31 December 2021 herein does not constitute the full statutory accounts for that period. The 2021 Annual Report and Accounts have been filed with the Registrar of Companies. The Independent Auditor's Report on the Annual Report and Financial Statements for 2021 was unqualified and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.

 

The condensed financial statements for the period ended 30 June 2022 have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Services Authority and with IAS 34 'Interim Financial Reporting'. The information in these condensed financial statements does not include all the information and disclosures made in the annual financial statements.

 

The condensed financial statements have been prepared in accordance with International Financial Reporting Standards (IFRS) in a manner consistent with the accounting policies set out in the Group financial statements for the year ended 31 December 2021.

 

Going concern

The interim financial statements have been prepared on a going concern basis. The Directors have reviewed the Group's cash flow forecasts for the period to 31 December 2023, taking account of reasonably possible changes in trading performance. Downside sensitivities have included reduced levels of new business and in these scenarios, headroom under the Group's financing facility meets the Group's funding requirements.

 

Financial instruments

Unless otherwise indicated, the carrying amounts of the Group's financial assets and liabilities are a reasonable approximation of their fair values.

 

Alternative performance measures

The Group uses certain alternative performance measures to report its results as stated before non-underlying items. These are non-IFRS alternative performance measures which the Directors consider can assist with an understanding of the underlying performance of the Group and comparison of performance across periods. They are not a substitute for and are not superior to any IFRS measure.

 

Adjusted profit/loss before tax is defined as profit/loss before tax and non-underlying items.  Adjusted EBITDA is defined as operating profit before finance costs, tax, depreciation, amortisation, share based payments and non-underlying items.

 

Non-underlying items

The presentation of the alternative performance measures of adjusted EBITDA and adjusted profit/loss before tax excludes non-underlying items. The Directors consider that an underlying profit measure can assist with an understanding of the underlying performance of the Group and comparison of performance across periods. Items are classified as non-underlying by nature of their magnitude, incidence or unpredictable nature and their separate identification results in a calculation of an underlying profit measure that is consistent with that reviewed by the Board in their monitoring of the performance of the Group. Events which may give rise to the classification of items as non-underlying include gains or losses on the disposal of a business, restructuring of a business, transaction costs, litigation and similar settlements, asset impairments and onerous contracts.

 

 

 

 

 

Accounting policies: new standards, amendments and interpretations

At the date of authorisation of these interim financial statements, several new, but not yet effective, standards, amendments to existing standards and interpretations have been published. None of these have been adopted early by the Group. New standards, amendments and interpretations not adopted in the current year have not been disclosed as they are not expected to have a material impact on the Group.

 

2              Segmental information

 

The basis by which the Group is organised and its operating model is structured, is by customer sectors, being the public sector and the private sector. The reporting of financial information presented to the Chief Operating Decision Maker, being the Group board of directors, is consistent with these reporting segments. As these reporting segments are supported by a combined back office, there is no allocation of overheads.

 

Six months to 30.06.22 (Unaudited)

 

Public sector

 

Private sector

 

Total

 

£'000

£'000

£'000

Revenue

12,137

8,917

21,054

Contractor costs

(11,137)

(8,000)

(19,137)

External contribution

1,000

917

1,917

 

Six months to 30.06.21 (Unaudited)

 

Public sector

 

Private sector

 

Total


£'000

£'000

£'000

Revenue

18,700

7,298

25,998

Contractor costs

(17,034)

(6,642)

(23,676)

External contribution

1,666

656

2,322

 

Year to 31.12.21 (Audited)

 

Public sector

 

Private sector

 

Total


£'000

£'000

£'000

Revenue

32,544

14,418

46,962

Contractor costs

(29,691)

(13,191)

(42,882)

External contribution

2,853

1,227

4,080

 

3              Revenue

 

The Group's revenue disaggregated by pattern of revenue recognition is as follows:

 

 

 

 

 

Six months to 30.06.22

(Unaudited)

£'000

Six months to 30.06.21

(Unaudited)

£'000

Year to 31.12.21

(Audited)

£'000

Services transferred over time

20,985

25,981

46,934

Services transferred at a point in time

69

17

28

Revenue

21,054

25,998

46,962






 

 

 

 

 

 

 

 

4              Non-underlying items

 

 

 

 

Six months to

30.06.22

(Unaudited)

£'000

Six months to

30.06.21

(Unaudited)

£'000

Year to
31.12.21

(Audited)

£'000

Restructuring

 


 

- Costs related to employees

23

366

502

- Costs related to premises

-

34

31

- Other costs

-

-

20


23

400

553


 



Items are classified as non-underlying by nature of their magnitude, incidence or unpredictable nature and their separate identification results in a calculation of an underlying profit measure that is consistent with that reviewed by the Board in their monitoring of the performance of the Group.

 

5              Finance costs

 

Six months to

30.06.22

(Unaudited)

£'000

Six months to

30.06.21

(Unaudited)

£'000

Year to
31.12.21

(Audited)

£'000

Interest expense on financial liabilities

50

33

65

Interest expense on lease liabilities

4

4

8

Interest income on lease assets

(1)

(2)

(3)

Net finance costs in respect of post-retirement benefits

107

74

211


160

109

281

 

The interest expense on financial liabilities represents interest paid on the Group's asset-based financing facilities.

 

 

6              Taxation

 

 

 

 

Six months to

30.06.22

(Unaudited)

£'000

Six months to

30.06.21

(Unaudited)

£'000

Year to
31.12.21

(Audited)

£'000

Recognised in the income statement

 


 

Current tax charge

-

-

-

Deferred tax charge/(credit)

213

34

(467)

Total tax charge/(credit)

213

34

(467)


 



Recognised in other comprehensive income

 



Deferred tax (credit)/charge

(274)

187

567

 



 

 

7              Earnings per ordinary share

 

Basic earnings per share is calculated by dividing the basic earnings for the period by the weighted average number of fully paid ordinary shares in issue during the period.  Diluted earnings per share is calculated on the same basis as the basic earnings per share with a further adjustment to the weighted average number of fully paid ordinary shares to reflect the effect of all dilutive potential ordinary shares.

 


Six months to 30.06.22

(Unaudited)

Six months to 30.06.21

(Unaudited)

Year to 31.12.21

(Audited)


 

 

 

Loss

£'000

Weighted

average number of

shares

000's

 

 

Loss

per share

Pence

 

 

 

Loss

£'000

Weighted

average number of

shares

000's

 

 

Loss

per share

Pence

 

 

 

Loss

£'000

Weighted

average number of

shares

000's

 

 

Loss

per share

Pence


Basic loss per share

(295)

103,076

(0.29)

(525)

102,624

(0.51)

(636)

102,854

(0.62)

Effect of dilutive options

-

-

-

-

-

-

-

-

-

Diluted loss per share

(295)

103,076

(0.29)

(525)

102,624

(0.51)

(636)

102,854

(0.62)


 

 

 








 

 

 







As at 30 June 2022, the number of ordinary shares in issue was 103,075,633 (30 June 2021: 102,624,020 and 31 December 2021: 103,075,633).

 

8              Pension commitments

 

The Group provides employee benefits under various arrangements, through defined benefit and defined contribution pension plans, the details of which are disclosed in the 2021 Annual Report and Accounts. At the interim balance sheet date, the major assumptions used in assessing the defined benefit pension scheme liability have been reviewed and updated based on a roll-forward of the last formal actuarial valuation, which was carried out as at April 2018.

 

The following estimates have been applied to the IAS 19 valuation:

 


30.06.22

30.06.21

31.12.21

Rate of increase in pensions in payment

3.7-4.0%

3.7-4.0%

3.8-4.0%

Discount rate

3.8%

1.8%

1.9%

Retail price inflation

3.4%

3.4%

3.6%

Consumer price inflation

2.4%

2.4%

2.6%

 

The surplus has reduced by £783k since 31 December 2021, primarily as a result of volatility and weakness in the investment markets during the period.

 

9              Related party transactions

 

Transactions between the Company and its subsidiaries, which are related parties, have been eliminated on consolidation and are therefore not disclosed.

 

In 2021, the Group engaged the marketing services of CRM Squad. The Executive Chairman Mark Braund is an owner and Director of CRM Squad. The total value of services received from CRM Squad in the six months to 30 June 2022 was £31,500 (Six months to 30 June 2021: none, Year to 31 December 2021: £12,180).

 

10           Events after the reporting period

 

There are no events after the reporting period not reflected in the interim financial statements.

 

Statement of directors' responsibilities

 

The directors confirm, to the best of their knowledge:

 

·           The condensed set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting';

 

·           The interim management report includes a fair review of the information required by DTR 4.2.7R of the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements, and a description of the principal risks and uncertainties for the remaining six months of the year, and gives a true and fair view of the assets, liabilities, financial position and profit for the period of the Group; and

 

·           The interim management report includes a fair review of the information required by DTR 4.2.8R of the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority, being a disclosure of related party transactions and changes therein since the previous annual report.

 

By order of the Board

 

 

 

Mark Braund

Executive Chairman

29 September 2022

 

 

 

 

 

 

 

 

 

 

 

 

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