TIDMPEBB

RNS Number : 3304Y

Pebble Group PLC (The)

06 September 2022

6 September 2022

THE PEBBLE GROUP PLC

("The Pebble Group" or the "Group")

UNAUDITED HALF YEAR RESULTS 2022

Record results expected for FY 22

The Pebble Group (AIM: PEBB), a leading provider of digital commerce, products and related services to the global promotional products industry, announces its unaudited results for the six months ended 30 June 2022 ("HY 22" or the "Period").

Having achieved strong year on year growth in HY 22, the Board is confident that for the year ending 31 December 2022 ("FY 22") the Group is expected to deliver another record year of results and will be at least in line with recently upgraded market expectations.

Financials

 
 Statutory results              HY 22      HY 21  Change       FY 21 
 Revenue                     GBP60.3m   GBP46.8m    +29%   GBP115.1m 
 Gross profit margin            38.5%      36.8%   +1.7%       36.5% 
 Operating profit             GBP3.1m    GBP2.2m    +41%     GBP9.9m 
 Profit before tax            GBP2.8m    GBP1.9m    +47%     GBP9.3m 
 Basic earnings per share       1.27p      0.85p    +49%       4.39p 
 
 
 Other financial highlights        HY 22       HY 21    Change      FY 21 
 Adjusted EBITDA(1)              GBP6.7m     GBP4.4m      +52%   GBP15.4m 
 Net (debt) / cash(2)          GBP(0.1)m   GBP(4.2)m  +GBP4.1m   GBP12.1m 
 Adjusted basic earnings 
  per share(3)                     1.88p       1.08p      +74%      5.14p 
 

Highlights and outlook

 
 --    Excellent performance against a strong comparative period with 
        Group revenue at GBP60.3m (HY 21: GBP46.8m) 29% ahead of the 
        same period in the prior year 
 --    Facilisgroup: Revenue for HY 22 up 32% on HY 21 with total Gross 
        Merchandise Value ("GMV"), transacted through our technology, 
        expected to be between USD1.3bn and USD1.5bn in FY 22 (FY 21: 
        USD1.2bn) 
 --    Brand Addition: Revenue for HY 22 up 29% on HY 21 with gross 
        profit margin at 29.9% (HY 21: 28.2%) 
 --    Balance sheet strong and working capital cycle following its 
        normal pattern, with the Group's net cash position at the full 
        year expected to be in line with current market expectations 
 --    Positive start to second half year: 
               Facilisgroup: 45 customers contracted with Commercio, our new 
                ecommerce product, since launch in June 2022 and Syncore Partners 
                implemented or contracted awaiting implementation at 218 at 
                5 September 2022; and 
 
                Brand Addition: due to our order visibility and current activities, 
                revenues in FY 22 are expected to be at least in line with market 
                expectations. Supply chain continues to be well-controlled 
 --    The Board expects a record year of results and for FY 22 to 
        be at least in line with recently upgraded market expectations 
 
 
        Adjusted EBITDA means operating profit before depreciation, 
  (1)    amortisation and share-based payments charge 
        Net (debt)/cash is calculated as cash and cash equivalents 
  (2)    less borrowings (excluding lease liabilities) 
        Adjusted basic earnings per share ("EPS") represents Adjusted 
  (3)    Earnings meaning profit after tax before amortisation of acquired 
         intangible assets, share-based payments charge and exceptional 
         items divided by a weighted average number of shares 
 

Online investor presentation

The management team is hosting an online investor presentation with Q&A at 1.00pm on Thursday, 8 September 2022. To participate, please register with PI World at: https://bit.ly/PEBB_H1_Results .

Enquiries:

 
 The Pebble Group                           Belvedere Communications (Financial 
  Chris Lee, Chief Executive Officer         PR) 
  Claire Thomson, Chief Financial Officer    Cat Valentine +44 (0) 7715 
  +44 (0) 161 786 0415                       769 078 
                                             Keeley Clarke +44 (0) 7967 
                                             816 525 thepebblegrouppr@belvederepr.com 
 Grant Thornton UK LLP (Nominated           Berenberg (Corporate Broker) 
  Adviser)                                   Chris Bowman / Arnav Kapoor 
  Samantha Harrison / Harrison Clarke        +44 (0) 20 3207 7800 
  / Ciara Donnelly 
  +44 (0) 20 7184 4384 
 

About The Pebble Group

The Pebble Group is a provider of digital commerce, products and related services to the global promotional products industry, comprising two differentiated businesses, Facilisgroup and Brand Addition, focused on specific areas of the promotional products market. For further information, please visit www.thepebblegroup.com .

CHIEF EXECUTIVE OFFICER'S REVIEW

Summary of results

Against a strong comparative period, we are pleased to report excellent results demonstrating that both of our businesses, Facilisgroup and Brand Addition, traded well throughout HY 22. In the Period, the Group achieved Revenue of GBP60.3m (HY 21: GBP46.8m), Adjusted EBITDA of GBP6.7m (HY 21: GBP4.4m) and Operating profit of GBP3.1m (HY 21: GBP2.2m).

For context, the Group's HY 22 revenue is 25% ahead of HY 19, the last pre-COVID-19 affected year.

The Group's balance sheet is underpinned by Brand Addition's blue-chip client base with Group working capital and cash management following its usual in-year cycle and in line with our expectations. Our businesses have a good track record of profit to cash conversion, which has continued, and the Group had Net debt at 30 June of GBP0.1m (30 June 2021: Net debt GBP4.2m and 31 December 2021: Net cash GBP12.2m).

We were pleased to announce on 19 July 2022 that the Group's results for FY 22 were expected to exceed market expectations as the Group continues to deliver on its strategic objectives. Trading since that update has continued with the same momentum and we expect FY 22 financial results to be at least in line with the upgraded market expectations.

Our approach to the promotional products market

The Group operates in the large promotional products market, estimated to be worth USD50bn globally. North America accounts for 50% of the total industry.

The industry has been operating in a similar way for many years, but our view is that this is changing. We believe the principle disrupting forces are:

 
 --    the proliferation of technology, which offers the potential of 
        significant efficiency benefits between suppliers, distributors, 
        and end users; and 
 --    a permanent shift towards sustainability, compliance, and overall 
        brand reputation management. 
 

The Pebble Group's strategy is to establish strong differentiation in this market, investing in sustainability and building technology to achieve superior levels of growth, customer retention and financial margins. This approach is deployed by our two businesses, Facilisgroup and Brand Addition.

At Facilisgroup, we identify ourselves as the leading digital commerce solutions provider in the promotional products industry in North America. We believe that our technology platform, currently targeted at SME distributors, is the market leader evidenced by high Partner (customer) retention levels, the provision of quality supply chain services and the community activities between our Partners, Preferred Suppliers and the business.

With Annual Recurring Revenue ("ARR") of USD12m in FY 20, we stated our initial ambition to reach ARR of USD50m through developing and launching further functionality and widening our target market. We remain focused on this ambition. In FY 22, we expect to reach ARR of over USD20m and have expanded our suite of products through the launch, in June 2022, of our ecommerce offering, Commercio.

At Brand Addition, we focus solely on fulfilling the multi-country promotional product needs of large global brands, working under contract.

Brand Addition is investing in creativity, sustainability and technology which give our clients confidence in the provenance of the products carrying their brand and ensure that the product has the desired emotional impact with the recipient. As a result, Brand Addition has an excellent track record of new client wins and client retention, together with a consistency of margins which is reflective of the quality of service delivered.

Facilisgroup: providing a digital commerce platform for promotional products businesses in North America

Revenue and profit analysis

 
                          HY 22    HY 21     FY 21 
 Recurring revenue      GBP7.0m  GBP5.4m  GBP12.2m 
 Other revenue          GBP0.4m  GBP0.2m   GBP0.5m 
 Total revenue          GBP7.4m  GBP5.6m  GBP12.7m 
 Gross profit margin       100%     100%      100% 
 Adjusted EBITDA        GBP3.5m  GBP3.0m   GBP7.6m 
 Operating profit       GBP1.7m  GBP2.1m   GBP5.1m 
 

ARR continued its growth in HY 22, increasing by 21.3% in USD, the business's home currency, and 29.6% in GBP, compared to HY 21.

Our ambition to accelerate growth is being backed by our investment in sales and marketing strategies and, in June 2022, we were pleased to return to hosting our Partners and Preferred Suppliers at our first large event post COVID-19 restrictions. The hosting of such events builds a community, benefiting Facilisgroup's high level of Partner retention and Preferred Supplier engagement.

The business has continued to deliver excellent Adjusted EBITDA returns of 47.3% (HY 21: 53.6%), while increasing our investment in growth. This investment includes the capitalisation of the internal costs of product development resulting in a higher amortisation charge in the Period. This is reflected in operating profit of GBP1.7m (HY 21: GBP2.2m).

The indicators that drive future growth of our ARR have continued to move forward and are positive against strong comparatives in HY 21:

 
 --      Gross Merchandise Value 
          +38% in HY 22 
          USD1.3bn to USD1.5bn expectation for FY 22 (FY 21: USD1.2bn) 
 --      Spend through our Preferred Suppliers 
          +54% in HY 22 
          + USD0.45bn expectation for FY 22 (FY 21: USD0.35bn) 
 --      Total Partners for our Syncore offering 
          218 at 5 September 2022 (31 December 2021: 206) 
 

Our product development programme, which is designed to extend the capabilities of our digital commerce platform, continues to progress with Facilisgroup's ecommerce offering, Commercio launching as planned in June 2022. To date, 45 businesses, from both existing Syncore Partners and non-Partners within the promotional products industry, have contracted to utilise the offering.

As we continue to build the feature set of Commercio, our ambition is to enter 2023 with an increasing customer base and for Commercio to develop into a market leading product in the industry. Our initial pricing strategy is based on a monthly fee plus a fee per store which, as Commercio grows, will in effect increase our percentage fee per USD of GMV.

Looking ahead, we expect Facilisgroup's revenue in FY 22 to be in line with market expectations.

Brand Addition: providing promotional products and related services under contract to many of the world's most recognisable brands

Revenue and profit analysis

 
                           HY 22     HY 21      FY 21 
 Revenue                GBP52.9m  GBP41.1m  GBP102.4m 
 Gross profit           GBP15.8m  GBP11.6m   GBP29.3m 
 Gross profit margin       29.9%     28.2%      28.6% 
 Adjusted EBITDA         GBP4.4m   GBP2.5m    GBP9.9m 
 Operating profit        GBP2.8m   GBP1.1m    GBP7.1m 
 

At Brand Addition, HY 22 revenue increased to GBP52.9m, being 28.7% ahead of HY 21. This revenue gain over the prior year was generated from new contracts won in 2020, which continue to develop positively, a full period contribution from contracts won in 2021, and growth in demand from existing clients, as working patterns stabilise following the uncertainties created by COVID-19 in 2020 and 2021.

Our continued focus on best-in-class procurement, working closely with suppliers and managing our supply chain proactively, has seen the business impacted less by freight and Brexit disruption costs in the Period than it was in 2021. This resulted in HY 22 gross profit margin of 29.9%, ahead of 28.2% in HY 21. Our supply chain continues to be well-controlled.

The costs between gross profit margin and Adjusted EBITDA are predominately people related and move proportionally with revenues.

Looking ahead, through our order visibility and current activities, we expect Brand Addition revenues in FY 22 to be at least in line with market expectations.

Environmental, Social and Governance ("ESG") and People

We continue to embrace ESG within the day-to-day business activities of our Group and will publish our second ESG Report in October 2022. Alongside the principles of the journey to which we are all committed, the report will detail examples of the progress that has been made including the completion of our Scope 3 evaluation and the implementation of our reporting framework for energy and carbon usage across the Group.

Our team is central to driving our ESG strategies and creating the positive, results driven culture that is key to our Group's success. The Board expresses its thanks to all our people who have displayed great talent and determination in delivering these results in what has often been challenging circumstances over the last two years.

Group outlook

We are continuing to deliver on our stated strategies for Facilisgroup and Brand Addition. Both businesses are performing well and we look forward to FY 22 and beyond with confidence.

Christopher Lee

Chief Executive Officer

6 September 2022

CHIEF FINANCIAL OFFICER'S REVIEW

 
                                        HY 22         HY 21         FY 21 
                                    Unaudited     Unaudited       Audited 
                                        GBP'm         GBP'm         GBP'm 
 Revenue                                 60.3          46.8         115.1 
 Gross profit                            23.2          17.2          42.0 
 Gross profit margin                    38.5%         36.8%         36.5% 
 Adjusted EBITDA                          6.7           4.4          15.4 
 Adjusted EBITDA margin                 11.1%          9.5%         13.4% 
 Depreciation and amortisation          (3.0)         (2.0)         (4.8) 
 Share-based payment charge             (0.6)         (0.2)         (0.7) 
 Operating profit                         3.1           2.2           9.9 
 Net finance costs                      (0.3)         (0.3)         (0.6) 
 Profit before tax                        2.8           1.9           9.3 
 Tax                                    (0.7)         (0.5)         (2.0) 
 Profit for the Period                    2.1           1.4           7.3 
 
 Weighted average number of 
  shares                          167,450,893   167,450,893   167,450,893 
 Adjusted Basic EPS                      1.88         1.08p         5.14p 
 Basic EPS                               1.27         0.85p         4.39p 
 

These results demonstrate strong growth against HY 21 as we continue to execute on our stated strategy.

Revenue

Revenue for the Period was GBP60.3m (HY 21: GBP46.8m), an increase of GBP13.5m (28.8%) compared to the same period and strong comparator in 2021. Of this increase, GBP11.8m relates to Brand Addition from the impact of new business, combined with growth in demand from underlying customers as working patterns stabilised compared to the disrupted periods in 2020 and 2021. Facilisgroup total revenues increased GBP1.8m (32.1%). ARR growth was 29.6% (21.3% when measured in Facilisgroup's home currency of USD). This was achieved through increases in our Management Fees from additional Partner numbers, implementation of a new tiered pricing structure and growth in our Marketing Fund where we benefited from Partners increasingly utilising our Preferred Suppliers.

Gross profit

Gross profit as a percentage of revenue increased to 38.5% (HY 21: 36.8%). This relates to gross margins at Brand Addition as the business did not incur the increased costs associated with Brexit, freight rate pricing, and freight capacity challenges that impacted HY 21, combined with strong control of ongoing supply chain challenges.

Adjusted EBITDA

Adjusted EBITDA was GBP6.7m (HY 21: GBP4.4m). The increase of GBP2.3m is made up as follows:

 
 -   Facilisgroup GBP0.5m increase from incremental revenue net 
      of the costs of investment in the team and events to support 
      delivery of our revenue aspirations; 
 -   Brand Addition GBP1.9m increase driven by GBP4.2m incremental 
      sales volumes less increased costs of additional headcount 
      to support growth; and 
 -   Central costs increase of GBP0.1m. 
 

The Adjusted EBITDA margin increased to 11.1% (HY 21: 9.5%) as improving margins and incremental revenues in Brand Addition translated to EBITDA.

Depreciation and amortisation

The total charge for the Period was GBP3.0m (HY 21: GBP2.0m) of which GBP1.9m (HY 21: GBP1.1m) was the amortisation of intangible assets. In accordance with IAS 38, the Group capitalises the costs incurred in the development of its software and the increase in the Period is a result of its continued investment in its proprietary technology and specifically the digital commerce platform at Facilisgroup.

Share-based payments

The total charge for the Period under IFRS 2 "Share-based payments" was GBP0.6m (HY 21: GBP0.2m). This charge related to the awards made to date under the Long Term Incentive Plan (LTIP) and the Group Sharesave Plan (SAYE).

Operating profit

Operating profit for the Period was GBP3.1m (HY 21: GBP2.2m).

Taxation

The tax charge for the Period was GBP0.7m (HY 21: GBP0.5m) and is based on full year Group expected tax charge for 2022. The Group rate is above the UK Corporation tax rate due to the proportion of Group profits earned overseas where the rates are higher than the UK.

Basic Earnings per share

The earnings per share analysis in note 5 covers both adjusted earnings per share (profit after tax before amortisation of acquired intangibles, share-based payments charge and exceptional items divided by the weighted average number of shares in issue during the year), and statutory earnings per share (profit attributable to equity holders divided by the weighted average number of shares in issue during the year). Adjusted earnings was GBP3.2m (HY 21: GBP1.8m) an increase in adjusted basic earnings per share of 0.80 pence. Basic earnings per share was 1.27 pence per share (HY 21: 0.85 pence per share) an increase of 0.42 pence.

Dividends

On admission to AIM in December 2019, the Group's stated intention was to make dividend payments of c.30% of profit after tax. This policy remains in place. However, as previously communicated we believe the opportunities ahead of us are significant, in particular, investment opportunities in Facilisgroup. As a result, we have taken the decision to retain cash in the business and not to pay an interim dividend in 2022. The timing of implementing our stated dividend policy will be considered again against the Group's full year progress and an update provided at that time.

Cashflow

The Group had a cash balance of GBP5.4m at 30 June 2022 (30 June 2021: GBP3.6m), which included GBP5.5m drawn down from its GBP10.0m committed revolving credit facility (30 June 2021: GBP7.8m).

Cashflow for the Period is set out below:

 
                                     HY 22       HY 21     FY 21 
                                 Unaudited   Unaudited   Audited 
                                     GBP'm       GBP'm     GBP'm 
 Adjusted EBITDA                       6.7         4.4      15.4 
 Movement in working capital        (14.8)      (12.7)     (2.8) 
 Capital expenditure                 (3.6)       (2.2)     (5.3) 
 Leases                              (0.9)       (0.6)     (1.4) 
                                ----------  ----------  -------- 
 Adjusted operating cash flow       (12.6)      (11.1)       5.9 
 Tax paid                            (0.3)       (0.1)     (0.5) 
 Net finance cash flows                5.2         7.5     (0.6) 
 Exchange loss                         1.0         0.2       0.2 
                                ----------  ----------  -------- 
 Net cash flow                       (6.7)       (3.5)       5.0 
 

The movement in working capital in the Period was GBP14.8m (HY 21: GBP12.7m). This outflow reflects the revenue growth of the Group and is in line with the normal in-year cycle which peaks in Q3.

Capital expenditure in the Period was GBP3.6m (HY 21: GBP2.2m). The GBP1.4m additional spend relates principally to investment in the Facilisgroup digital commerce platform.

Lease payments relate to leases capitalised in accordance with IFRS 16. The increase arises as the Group has consolidated its European warehousing at a larger facility during the Period.

Net finance cash flows in the Period of GBP5.2m (HY 21: GBP7.5m) relate to utilisations on committed facilities less interest payments in respect of leases capitalised in accordance with IFRS 16.

Cash and liquidity

The Group's working capital cycle is unwinding as expected. At 5 September, the Group had a cash balance of GBP6.8m which includes GBP4.3m drawn down from the GBP10.0m committed revolving credit facility. At 31 December 2022, we expect no drawn down balances and cash to be in line with market expectations being greater than the GBP12.1m as at 31 December 2021.

Claire Thomson

Chief Financial Officer

6 September 2022

CONSOLIDATED INCOME STATEMENT

 
                                             Unaudited       Unaudited        Audited 
                                          Period ended    Period ended     Year ended 
                                               30 June         30 June    31 December 
                                 Notes            2022            2021           2021 
                                        --------------  --------------  ------------- 
                                               GBP'000         GBP'000        GBP'000 
 
 Revenue                                        60,316          46,759        115,101 
 Cost of goods sold                           (37,099)        (29,533)       (73,128) 
                                        --------------  --------------  ------------- 
 Gross profit                                   23,217          17,226         41,973 
 
 Operating expenses                           (20,168)        (15,064)       (32,107) 
 Total operating expenses                     (20,168)        (15,064)       (32,107) 
                                        --------------  --------------  ------------- 
 Operating profit                                3,049           2,162          9,866 
 
 Analysed as: 
 Adjusted EBITDA(1)                              6,698           4,448         15,378 
 Depreciation                     7            (1,134)           (986)        (1,986) 
 Amortisation                     6            (1,877)         (1,071)        (2,811) 
 Share-based payment charge      11              (638)           (229)          (715) 
 Operating profit                                3,049           2,162          9,866 
----------------------------  --------  --------------  -------------- 
 
 Finance expense                                 (245)           (269)          (549) 
                                        --------------  --------------  ------------- 
 Profit before taxation                          2,804           1,893          9,317 
 
 Income tax expense               4              (673)           (473)        (1,970) 
                                        --------------  --------------  ------------- 
 Profit for the period                           2,131           1,420          7,347 
                                        ==============  ==============  ============= 
 
 Basic earnings per share         5              1.27p           0.85p          4.39p 
                                        ==============  ==============  ============= 
 
 Diluted earnings per share       5              1.27p           0.84p          4.38p 
                                        ==============  ==============  ============= 
 

Note 1: Adjusted EBITDA, which is defined as operating profit before depreciation, amortisation, exceptional items and share-based payment charge is a non-GAAP metric used by management and is not an IFRS disclosure.

CONSOLIDATED STATEMENT OF OTHER COMPREHENSIVE INCOME

 
                                                                     Unaudited        Unaudited       Audited 
                                                                  Period ended     Period ended    Year ended 
                                                                       30 June          30 June   31 December 
                                                                          2022             2021          2021 
                                                                 -------------  ---------------  ------------ 
                                                                       GBP'000          GBP'000       GBP'000 
 
Items that may be subsequently reclassified to profit and loss 
Foreign operations - foreign currency translation differences            2,443            (218)           277 
                                                                 -------------  ---------------  ------------ 
Other comprehensive income/(expense) for the period/year                 2,443            (218)           277 
 
Profit for the period/year                                               2,131            1,420         7,347 
                                                                 -------------  ---------------  ------------ 
Total comprehensive income for the period/year                           4,574            1,202         7,624 
                                                                 =============  ===============  ============ 
 

CONSOLIDATED STATEMENT OF FINANCIAL POSITION

 
                                          Unaudited   Unaudited     Audited 
                                              As at       As at    As at 31 
                                            30 June     30 June    December 
                                  Notes        2022        2021        2021 
                                         ----------  ----------  ---------- 
                                            GBP'000     GBP'000     GBP'000 
 ASSETS 
 Non-current assets 
 Intangible assets                  6        58,765      54,387      55,674 
 Property, plant and equipment      7        10,194       8,460       7,927 
 Deferred tax asset                             395         316         300 
 Total non-current assets                    69,354      63,163      63,901 
                                         ----------  ----------  ---------- 
 
 Current assets 
 Inventories                        8        16,081      15,635      10,093 
 Trade and other receivables                 38,587      30,032      29,422 
 Cash and cash equivalents                    5,351       3,601      12,051 
 Current tax asset                                -         533           - 
                                         ----------  ----------  ---------- 
 Total current assets                        60,019      49,801      51,566 
                                         ----------  ----------  ---------- 
 
 TOTAL ASSETS                               129,373     112,964     115,467 
                                         ==========  ==========  ========== 
 
 LIABILITIES 
 Non-current liabilities 
 Lease liability                    9         8,185       7,068       6,388 
 Deferred tax liability                       3,751       2,630       3,035 
 Total non-current liabilities               11,936       9,698       9,423 
                                         ----------  ----------  ---------- 
 
 Current liabilities 
 Borrowings                                   5,500       7,750           - 
 Lease liability                    9         1,612       1,422       1,384 
 Trade and other payables                    30,485      26,399      30,065 
 Current tax liability                          169           -          20 
 Total current liabilities                   37,766      35,571      31,469 
                                         ----------  ----------  ---------- 
 
 TOTAL LIABILITIES                           49,702      45,269      40,892 
                                         ==========  ==========  ========== 
 
 NET ASSETS                                  79,671      67,695      74,575 
                                         ==========  ==========  ========== 
 
 EQUITY AND RESERVES 
 Share capital                                1,675       1,675       1,675 
 Share premium                               78,451      78,451      78,451 
 Capital reserve                                125         125         125 
 Merger reserve                           (103,581)   (103,581)   (103,581) 
 Translation reserve                          1,116     (1,822)     (1,327) 
 Share-based payments reserve                 1,203         223         681 
 Retained earnings                          100,682      92,624      98,551 
                                         ----------  ----------  ---------- 
 TOTAL EQUITY                                79,671      67,695      74,575 
                                         ==========  ==========  ========== 
 

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

 
 
                                                                                      Share-based 
                                Share     Share    Capital     Merger    Translation     payments   Retained    Total 
                              capital   premium    reserve    reserve        reserve      reserve   earnings   equity 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
                              GBP'000   GBP'000               GBP'000        GBP'000                 GBP'000  GBP'000 
 
At 1 January 2021               1,800    78,451          -  (103,581)        (1,604)           13     91,204   66,283 
                           ==========  ========  =========  =========  =============  ===========  =========  ======= 
 
Profit for the period               -         -          -          -              -            -      1,420    1,420 
Other comprehensive 
 expense for the period             -         -          -          -          (218)            -          -    (218) 
Total comprehensive 
 (expense)/income                   -         -          -          -          (218)            -      1,420    1,202 
Purchase of deferred 
 shares                         (125)         -        125          -              -            -          -        - 
Employee share schemes 
 - value of employee 
 services                           -         -          -          -              -          210          -      210 
Total transactions 
 with owners recognised 
 in equity                      (125)         -        125          -              -          210          -      210 
At 30 June 2021                 1,675    78,451        125  (103,581)        (1,822)          223     92,624   67,695 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
 
Profit for the period               -         -          -          -              -            -      5,927    5,927 
Other comprehensive 
 income for the period              -         -          -          -            495            -          -      495 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
Total comprehensive 
 income                             -         -          -          -            495            -      5,927    6,422 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
 
Employee share schemes 
 - value of employee 
 services                           -         -          -          -              -          391          -      391 
Deferred tax on employee 
 share schemes                      -         -          -          -              -           67          -       67 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
Total transactions 
 with owners recognised 
 in equity                          -         -          -          -              -          458          -      458 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
At 31 December 2021             1,675    78,451        125  (103,581)        (1,327)          681     98,551   74,575 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
 
Profit for the period               -         -          -          -              -            -      2,131    2,131 
Other comprehensive 
 income for the period              -         -          -          -          2,443            -          -    2,443 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
Total comprehensive 
 income                             -         -          -          -          2,443            -      2,131    4,574 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
Employee share schemes 
 - value of employee 
 services                           -         -          -          -              -          577          -      577 
Deferred tax on employee 
 share schemes                      -         -          -          -              -         (55)          -     (55) 
Total transactions 
 with owners recognised 
 in equity                          -         -          -          -              -          522          -      522 
At 30 June 2022                 1,675    78,451        125  (103,581)          1,116        1,203    100,682   79,671 
                           ----------  --------  ---------  ---------  -------------  -----------  ---------  ------- 
 

CONSOLIDATED CASH FLOW STATEMENT

 
                                                                  Unaudited   Unaudited        Audited 
                                                                     Period      Period     Year ended 
                                                                      ended       ended    31 December 
                                                                    30 June     30 June           2021 
                                                          Notes        2022        2021 
                                                                 ----------  ----------  ------------- 
                                                                    GBP'000     GBP'000        GBP'000 
 
 Operating profit                                                     3,049       2,162          9,866 
 Adjustments for: 
 
        *    Depreciation                                   7         1,134         986          1,986 
 
        *    Amortisation                                   6         1,877       1,071          2,811 
 
        *    Share-based payments charge                   11           638         229            715 
 
        *    Profit on disposal of fixed assets                           -           -           (13) 
 Cash flows from operating activities 
  before changes in working capital                                   6,698       4,448         15,365 
 
 
        *    Change in inventories                                  (5,988)     (3,526)          2,016 
 
        *    Change in trade receivables                            (9,148)     (9,044)        (8,433) 
 
        *    Change in trade payables                                   321       (129)          3,556 
                                                                 ----------  ----------  ------------- 
 Cash flows (used in)/from operating 
  activities                                                        (8,117)     (8,251)         12,504 
 
 
        *    Income taxes paid                                        (326)        (46)          (521) 
                                                                 ----------  ----------  ------------- 
 Net cash flows (used in)/from 
  operating activities                                              (8,443)     (8,297)         11,983 
                                                                 ----------  ----------  ------------- 
 
 Cash flows from investing activities 
 
        *    Purchase of property, plant and equipment                (444)       (257)          (680) 
 
        *    Purchase of intangible assets                          (3,104)     (1,983)        (4,602) 
 Net cash flows used in investing 
  activities                                                        (3,548)     (2,240)        (5,282) 
                                                                 ----------  ----------  ------------- 
 
 Cash flows from financing activities 
 
        *    Lease payments                                           (929)       (594)        (1,360) 
 
        *    Interest paid                                            (245)       (269)          (549) 
 
        *    Receipts from secured loan facilities                    5,500       7,750              - 
 Net cash flows from/(used in) 
  financing activities                                                4,326       6,887        (1,909) 
                                                                 ----------  ----------  ------------- 
 
 NET CASH FLOWS                                                     (7,665)     (3,650)          4,792 
                                                                 ==========  ==========  ============= 
 
 Cash and cash equivalents at beginning 
  of period                                                          12,051       7,066          7,066 
 Effect of exchange rate fluctuations 
  on cash held                                                          965         185            193 
                                                                 ----------  ----------  ------------- 
 Cash and cash equivalents at end 
  of period                                                           5,351       3,601         12,051 
                                                                 ----------  ----------  ------------- 
 

NOTES TO THE UNAUDITED CONSOLIDATED INTERIM FINANCIAL INFORMATION

   1.     GENERAL INFORMATION 

The principal activity of The Pebble Group (the "Company") is that of a holding company and the principal activity of the Company and its subsidiaries (the "Group") is the sale of products, services and technology to the promotional merchandise industry. The Group has two segments, Brand Addition and Facilisgroup. For Brand Addition this is the sale of promotional products internationally, to many of the world's best-known brands, and for Facilisgroup the provision of technology, consolidated buying power and community learning and networking events to SME promotional product distributors in North America, its Partners, through subscription-based services.

The Company was incorporated on 27 September 2019 in the United Kingdom and is a public company limited by shares registered in England and Wales. The registered office of the Company is Broadway House, Trafford Wharf Road, Trafford Park, Manchester, England M17 1DD. The Company registration number is 12231361.

   2.     BASIS OF PREPARATION 

These condensed consolidated interim financial statements of the Group are for the period ended 30 June 2022. They have been prepared on the basis of the policies set out in the 2021 annual financial statements and in accordance with UK adopted IAS 34. Financial information for the period ended 30 June 2021 included herein is derived from the condensed consolidated interim financial statements for that period.

The condensed consolidated interim financial statements have not been reviewed or audited, nor do they comprise statutory accounts for the purpose of Section 434 of the Companies Act 2006, and do not include all of the information or disclosures required in the annual financial statements and should therefore be read in conjunction with the Group's 2021 annual financial statements, which were prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and international financial reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union.

Financial information for the year ended 31 December 2021 included herein is derived from the statutory accounts for that year, which have been filed with the Registrar of Companies. The auditors' report on those accounts was unqualified, did not contain an emphasis of matter paragraph and did not contain a statement under Section 498 of the Companies Act 2006.

The condensed consolidated interim financial statements are presented in the Group's functional currency of pounds Sterling and all values are rounded to the nearest thousand (GBP'000) except when otherwise indicated.

Accounting Policies

The accounting policies adopted in the preparation of the condensed consolidated interim financial statements are consistent with those followed in the preparation of the Group's annual financial statements for the year ended 31 December 2021 as described in the Group's Annual Report and financial statements for that year and as available on the Group's website ( www.thepebblegroup.com ).

Taxation

Taxes on income in the interim periods are accrued using management's best estimate of the weighted average annual tax rate that would be applicable to expected total annual earnings.

Forward looking statements

Certain statements in this report are forward looking with respect to the operations, strategy, performance, financial condition and growth opportunities of the Group. The terms "expect", "anticipate", "should be", "will be", "is likely to" and similar expressions identify forward-looking statements. Although the Board believes that the expectations reflected in these forward-looking statements are reasonable, by their nature these statements are based on assumptions and are subject to a number of risks and uncertainties. Actual events could differ materially from those expressed or implied by these forward-looking statements. Factors which may cause future outcomes to differ from those foreseen in forward-looking statements include, without limitation: general economic conditions and business conditions in the Group's markets; customers' expectations and behaviours; supply chain developments; technology changes; the actions of competitors; exchange rate fluctuations; and legislative, fiscal and regulatory developments. Information contained in these financial statements relating to the Group should not be relied upon as a guide to future performance.

Key risks and uncertainties

The Group has in place a structured risk management and internal control framework. The risk register identifies key risks and uncertainties that could affect the Group's performance, along with their associated mitigants and controls. The Group has reviewed and updated its risk register at half year 2022, including the addition of a separate sub-register on climate related risks and opportunities.

As a result of the review, one risk (dependence, attraction and retention of key personnel) was increased from 'amber' to 'red' overall risk score; three risks were increased from 'green' to 'amber' overall risk score (technological change and pressure from market competitors/new entrants, tax and share price volatility/liquidity); and one risk was reduced from 'green' to 'amber' overall risk score (Brexit). These changes reflect and align with our current experience of focus, risk likelihood and impact. However, overall, the key risks and uncertainties faced by the Group in the context of achieving its strategic objectives, and the factors that mitigate those risks, have not substantially changed from those set out in the Group's Annual Report which can be found on the Group's website ( www.thepebblegroup.com ).

Going Concern statement

The Group meets its day-to-day working capital requirements through its own cash balances and committed banking facilities. In assessing the appropriateness of adopting the going concern basis in the preparation of these consolidated interim financial statements, the Directors have prepared cash flow forecasts and projections for the up to 31 December 2023.

The forecasts and projections, which the Directors consider to be prudent, have been further sensitised by applying reductions to revenue growth and margin, to consider a severe but plausible downside. Under both the base and sensitised case the Group is expected to have headroom against covenants, which are based on interest cover and net leverage, and a sufficient level of financial resources available through existing facilities when the future funding requirements of the Group are compared with the level of committed available facilities. Based on this, the Directors are satisfied that the Group has adequate resources to continue in operational existence for the foreseeable future. For this reason, they continue to adopt the going concern basis in preparing the consolidated interim financial statements.

   3.     SEGMENTAL ANALYSIS 

The chief operating decision-maker has been identified as the Executive Directors. The Directors review The Pebble Group's internal reporting in order to assess performance and allocate resources. The Directors have determined that the operating segments are those of Brand Addition and Facilisgroup.

Segment information about the above segments is presented below:

Income statement for the period ended 30 June 2022

 
                                                                                  Period 
                                                                                   ended 
                                                                      Central    30 June 
                                  Brand Addition   Facilisgroup    operations       2022 
                                 ---------------  -------------  ------------  --------- 
                                         GBP'000        GBP'000       GBP'000    GBP'000 
 
 Revenue                                  52,926          7,390             -     60,316 
 Cost of goods sold                     (37,099)              -             -   (37,099) 
                                 ---------------  -------------  ------------  --------- 
 Gross profit                             15,827          7,390             -     23,217 
 
 Operating expenses                     (13,060)        (5,729)       (1,379)   (20,168) 
 Total operating expenses               (13,060)        (5,729)       (1,379)   (20,168) 
                                 ---------------  -------------  ------------  --------- 
 Operating profit/(loss)                   2,767          1,661       (1,379)      3,049 
 
 Analysed as: 
 Adjusted EBITDA                           4,377          3,515       (1,194)      6,698 
 Depreciation                              (825)          (291)          (18)    (1,134) 
 Amortisation                              (518)        (1,359)             -    (1,877) 
 Share-based payment charge                (267)          (204)         (167)      (638) 
 Operating profit/(loss)                   2,767          1,661       (1,379)      3,049 
-------------------------------  ---------------  -------------  ------------ 
 
 Finance expense                           (185)            (9)          (51)      (245) 
                                 ---------------  -------------  ------------  --------- 
 Profit/(loss) before taxation             2,582          1,652       (1,430)      2,804 
 
 Income tax (expense)/income               (620)          (396)           343      (673) 
                                 ---------------  -------------  ------------  --------- 
 Profit/(loss) for the period              1,962          1,256       (1,087)      2,131 
                                 ===============  =============  ============  ========= 
 

Due to the timing on the delivery of orders, the Brand Addition segment of The Pebble Group traditionally raises a higher number of invoices in the period July to December which results in The Pebble Group's performance being weighted to the second half of the year.

All the above revenues are generated from contracts with customers.

Income statement for the period ended 30 June 2021

 
                                                                                  Period 
                                                                                   ended 
                                                                      Central    30 June 
                                  Brand Addition   Facilisgroup    operations       2021 
                                 ---------------  -------------  ------------  --------- 
                                         GBP'000        GBP'000       GBP'000    GBP'000 
 
 Revenue                                  41,124          5,635             -     46,759 
 Cost of goods sold                     (29,533)              -             -   (29,533) 
                                 ---------------  -------------  ------------  --------- 
 Gross profit                             11,591          5,635             -     17,226 
 
 Operating expenses                     (10,452)        (3,499)       (1,113)   (15,064) 
 Total operating expenses               (10,452)        (3,499)       (1,113)   (15,064) 
                                 ---------------  -------------  ------------  --------- 
 Operating profit/(loss)                   1,139          2,136       (1,113)      2,162 
 
 Analysed as: 
 Adjusted EBITDA                           2,450          3,005       (1,007)      4,448 
 Depreciation                              (705)          (260)          (21)      (986) 
 Amortisation                              (533)          (538)             -    (1,071) 
 Share-based payment charge                 (73)           (71)          (85)      (229) 
                                                  -------------  ------------  --------- 
 Operating profit/(loss)                   1,139          2,136       (1,113)      2,162 
-------------------------------  ---------------  -------------  ------------  --------- 
 
 Finance expense                           (191)           (15)          (63)      (269) 
                                 ---------------  -------------  ------------  --------- 
 Profit/(loss) before taxation               948          2,121       (1,176)      1,893 
 
 Income tax (expense)/income               (255)          (548)           330      (473) 
                                 ---------------  -------------  ------------  --------- 
 Profit/(loss) for the period                693          1,573         (846)      1,420 
                                 ===============  =============  ============  ========= 
 

Income statement for the year ended 31 December 2021

 
                                                                                  Year ended 
                                                                      Central    31 December 
                                  Brand Addition   Facilisgroup    operations           2021 
                                 ---------------  -------------  ------------  ------------- 
                                         GBP'000        GBP'000       GBP'000        GBP'000 
 
 Revenue                                 102,383         12,718             -        115,101 
 Cost of goods sold                     (73,128)              -             -       (73,128) 
                                 ---------------  -------------  ------------  ------------- 
 Gross profit                             29,255         12,718             -         41,973 
 
 Operating expenses                     (22,133)        (7,577)       (2,397)       (32,107) 
 Total operating expenses               (22,133)        (7,577)       (2,397)       (32,107) 
 Operating profit/(loss)                   7,122          5,141       (2,397)          9,866 
 
 Analysed as: 
 Adjusted EBITDA                           9,932          7,581       (2,135)         15,378 
 Depreciation                            (1,410)          (533)          (43)        (1,986) 
 Amortisation                            (1,136)        (1,675)             -        (2,811) 
 Share-based payment charge                (264)          (232)         (219)          (715) 
 Total operating profit/(loss)             7,122          5,141       (2,397)          9,866 
-------------------------------  ---------------  -------------  ------------ 
 
 Finance expense                           (378)           (26)         (145)          (549) 
                                 ---------------  -------------  ------------  ------------- 
 Profit/(loss) before taxation             6,744          5,115       (2,542)          9,317 
 
 Income tax (expense)/income               (865)        (1,131)            26        (1,970) 
                                 ---------------  -------------  ------------  ------------- 
 Profit/(loss) for the year                5,879          3,984       (2,516)          7,347 
                                 ===============  =============  ============  ============= 
 

Statement of financial position as at 30 June 2022

 
                                                                                   As at 
                                                                      Central    30 June 
                                  Brand Addition   Facilisgroup    operations       2022 
                                 ---------------  -------------  ------------  --------- 
                                         GBP'000        GBP'000       GBP'000    GBP'000 
 ASSETS 
 Non-current assets 
 Intangible assets                        37,840         20,925             -     58,765 
 Property, plant and equipment             6,903          3,231            60     10,194 
 Deferred tax asset                          213            115            67        395 
 Total non-current assets                 44,956         24,271           127     69,354 
                                 ---------------  -------------  ------------  --------- 
 
 Current assets 
 Inventories                              16,081              -             -     16,081 
 Trade and other receivables              34,813          3,769             5     38,587 
 Cash and cash equivalents                 2,905          2,219           227      5,351 
 Total current assets                     53,799          5,988           232     60,019 
                                 ---------------  -------------  ------------  --------- 
 
 TOTAL ASSETS                             98,755         30,259           359    129,373 
                                 ===============  =============  ============  ========= 
 
 LIABILITIES 
 Non-current liabilities 
 Lease liability                           5,676          2,447            62      8,185 
 Deferred tax liability                        -          3,751             -      3,751 
 Total non-current liabilities             5,676          6,198            62     11,936 
                                 ---------------  -------------  ------------  --------- 
 
 Current liabilities 
 Borrowings                                5,500              -             -      5,500 
 Lease liability                           1,252            339            21      1,612 
 Trade and other payables                 27,233          2,665           587     30,485 
 Current tax liability                       393             18         (242)        169 
 Total current liabilities                34,378          3,022           366     37,766 
                                 ---------------  -------------  ------------  --------- 
 
 TOTAL LIABILITIES                        40,054          9,220           428     49,702 
                                 ===============  =============  ============  ========= 
 
 NET ASSETS/(LIABILITIES)                 58,701         21,039          (69)     79,671 
                                 ===============  =============  ============  ========= 
 

Statement of financial position as at 30 June 2021

 
                                                                                   As at 
                                                                      Central    30 June 
                                  Brand Addition   Facilisgroup    operations       2021 
                                 ---------------  -------------  ------------  --------- 
                                         GBP'000        GBP'000       GBP'000    GBP'000 
 ASSETS 
 Non-current assets 
 Intangible assets                        37,744         16,643             -     54,387 
 Property, plant and equipment             5,146          3,215            99      8,460 
 Deferred tax asset                           41             19           256        316 
 Total non-current assets                 42,931         19,877           355     63,163 
                                 ---------------  -------------  ------------  --------- 
 
 Current assets 
 Inventories                              15,635              -             -     15,635 
 Trade and other receivables              27,524          2,456            52     30,032 
 Cash and cash equivalents                 2,967            394           240      3,601 
 Current tax asset                         (193)            194           532        533 
                                 ---------------  -------------  ------------  --------- 
 Total current assets                     45,933          3,044           824     49,801 
 
 TOTAL ASSETS                             88,864         22,921         1,179    112,964 
                                 ===============  =============  ============  ========= 
 
 LIABILITIES 
 Non-current liabilities 
 Lease liability                           4,630          2,438             -      7,068 
 Deferred tax liability                        -          2,630             -      2,630 
                                 ---------------  -------------  ------------  --------- 
 Total non-current liabilities             4,630          5,068             -      9,698 
                                 ---------------  -------------  ------------  --------- 
 
 Current liabilities 
 Borrowings                                7,750              -             -      7,750 
 Lease liability                           1,100            322             -      1,422 
 Trade and other payables                 23,462          2,405           532     26,399 
 Total current liabilities                32,312          2,727           532     35,571 
                                 ---------------  -------------  ------------  --------- 
 
 TOTAL LIABILITIES                        36,942          7,795           532     45,269 
                                 ===============  =============  ============  ========= 
 
 NET ASSETS                               51,922         15,126           647     67,695 
                                 ===============  =============  ============  ========= 
 
 

Statement of financial position as at 31 December 2021

 
                                                                                  As at 
                                      Brand                      Central    31 December 
                                   Addition   Facilisgroup    operations           2021 
                                 ----------  -------------  ------------  ------------- 
                                    GBP'000        GBP'000       GBP'000        GBP'000 
 ASSETS 
 Non-current assets 
 Intangible assets                   37,728         17,946             -         55,674 
 Property, plant and equipment        4,766          3,083            78          7,927 
 Deferred tax asset                     146             58            96            300 
 Total non-current assets            42,640         21,087           174         63,901 
                                 ----------  -------------  ------------  ------------- 
 
 Current assets 
 Inventories                         10,093              -             -         10,093 
 Trade and other receivables         25,415          3,930            77         29,422 
 Cash and cash equivalents           10,335          1,230           486         12,051 
 Total current assets                45,843          5,160           563         51,566 
                                 ----------  -------------  ------------  ------------- 
 
 TOTAL ASSETS                        88,483         26,247           737        115,467 
                                 ==========  =============  ============  ============= 
 
 LIABILITIES 
 Non-current liabilities 
 Lease liability                      4,018          2,349            21          6,388 
 Deferred tax liability                   -          3,035             -          3,035 
 Total non-current liabilities        4,018          5,384            21          9,423 
                                 ----------  -------------  ------------  ------------- 
 
 Current liabilities 
 Lease liability                        985            328            71          1,384 
 Trade and other payables            26,500          2,752           813         30,065 
 Current tax liability/(asset)           28             36          (44)             20 
 Total current liabilities           27,513          3,116           840         31,469 
                                 ----------  -------------  ------------  ------------- 
 
 TOTAL LIABILITIES                   31,531          8,500           861         40,892 
                                 ==========  =============  ============  ============= 
 
 NET ASSETS                          56,952         17,747         (124)         74,575 
                                 ==========  =============  ============  ============= 
 
   4.     INCOME TAX EXPENSE 

The income tax expense for the Period is based upon management's best estimate of the weighted average annual tax rate expected for the full year ending 31 December 2022. The income tax expense is higher than the standard rate of 19% due to higher standard income tax rates in overseas territories and overseas losses carried forward. The income tax expense for the year ended 31 December 2021 was higher than the standard rate due to higher standard income tax rates in overseas territories.

   5.     EARNINGS PER SHARE 

Basic earnings per share are calculated by dividing the earnings attributable to equity shareholders by the weighted average number of ordinary shares in issue during the Period.

For diluted earnings per share, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all potentially dilutive ordinary shares. The Company has potentially dilutive ordinary shares arising from share options granted to employees. Options are dilutive under the SAYE, where the exercise price together with the future IFRS 2 charge of the option is less than the average market price of the Company's ordinary shares during the period. Options under the LTIP schemes, as defined by IFRS 2, are contingently issuable shares and are therefore only included within the calculation of diluted EPS if the performance conditions are satisfied at the end of the reporting period, irrespective of whether this is the end of the vesting period or not.

The impact of the potentially dilutive share options issued under The Pebble Group LTIP's dated 21 December 2020, 8 June 2021 and 29 March 2022 and SAYE dated 6 October 2021 is GBPnil for the period ended 30 June 2022. The impact on the basic earnings per share for the period ended 30 June 2021 is 0.01p.

The calculation of basic earnings per share is based on the following data:

Statutory EPS

 
                                                       Unaudited     Unaudited        Audited 
                                                          Period        Period     Year ended 
                                                           ended         ended    31 December 
                                                         30 June       30 June           2021 
                                                            2022          2021 
 
 Earnings (GBP'000) 
 Earnings for the purposes of basic and 
  diluted earnings per share 
  being profit for the period attributable 
  to equity shareholders                                   2,131         1,420          7,347 
                                                    ------------  ------------  ------------- 
 Number of shares 
 Weighted average number of shares for 
  the purposes of basic earnings per share           167,450,893   167,450,893    167,450,893 
 Weighted average dilutive effects of conditional 
  share awards                                                 -       649,260        353,605 
 Weighted average number of shares for 
  the purposes of diluted earnings per share         167,450,893   168,100,153    167,804,498 
                                                    ------------  ------------  ------------- 
 Earnings per ordinary share (pence) 
 Basic earnings per ordinary share (pence)                  1.27          0.85           4.39 
 Diluted earnings per ordinary share (pence)                1.27          0.84           4.38 
                                                    ------------  ------------  ------------- 
 
 

Adjusted EPS

The calculation of adjusted earnings per share is based on the after-tax adjusted operating profit after adding back certain costs as detailed in the table below. Adjusted earnings per share figures are given to exclude the effects of amortisation of acquired intangible assets, share-based payment charge and exceptional items, all net of taxation, and are considered to show the underlying performance of the Group.

 
                                                       Unaudited     Unaudited        Audited 
                                                          Period        Period     Year ended 
                                                           ended         ended    31 December 
                                                         30 June       30 June           2021 
                                                            2022          2021 
                                                    ------------  ------------  ------------- 
 Earnings (GBP'000) 
 Earnings for the purposes of basic and 
  diluted earnings per share being adjusted 
  earnings                                                 3,153         1,808          8,599 
                                                    ------------  ------------  ------------- 
 Number of shares 
 Weighted average number of shares for the 
  purposes of adjusted earnings per share            167,450,893   167,450,893    167,450,893 
 Weighted average dilutive effects of conditional 
  share awards                                                 -       649,260        353,605 
 Weighted average number of shares for the 
  purposes of diluted earnings per share             167,450,893   168,100,153    167,804,498 
                                                    ------------  ------------  ------------- 
 Adjusted earnings per ordinary share (pence) 
 Basic adjusted earnings per ordinary share 
  (pence)                                                   1.88          1.08           5.14 
 Diluted adjusted earnings per ordinary 
  share (pence)                                             1.88          1.08           5.12 
                                                    ------------  ------------  ------------- 
 

The calculation of adjusted earnings per share is based on the following data:

 
                                                  Unaudited      Unaudited        Audited 
                                                     Period         Period     Year ended 
                                                      ended          ended    31 December 
                                                    30 June        30 June           2021 
                                                       2022           2021 
                                              -------------  -------------  ------------- 
                                                    GBP'000        GBP'000        GBP'000 
 Profit for the period attributable to 
  equity shareholders                                 2,131          1,420          7,347 
                                              -------------  -------------  ------------- 
 Add back/(deduct): 
 Amortisation charge on acquired intangible 
  assets                                                677            250            894 
 Share-based payment charge                             638            229            715 
 Tax effect of the above                              (293)           (91)          (357) 
                                              -------------  -------------  ------------- 
 Adjusted earnings                                    3,153          1,808          8,599 
                                              =============  =============  ============= 
 
   6.     INTANGIBLE ASSETS 
 
                                                                     Software 
                                                  Customer    and Development     Work in 
                                 Goodwill    relationships              costs    progress     Total 
                                ---------  ---------------  -----------------  ----------  -------- 
                                  GBP'000          GBP'000            GBP'000     GBP'000   GBP'000 
 Cost 
 Balance at 31 December 
  2020                             35,802           10,144             17,130         222    63,298 
                                ---------  ---------------  -----------------  ----------  -------- 
 FX difference on translation        (86)            (183)               (76)           -     (345) 
 Additions                              -                -              1,612         174     1,786 
 Balance at 30 June 
  2021                             35,716            9,961             18,666         396    64,739 
                                ---------  ---------------  -----------------  ----------  -------- 
 FX difference on translation          89              280                176           -       545 
 Additions                              -                -              1,941         565     2,506 
 Reclassifications                      -                -                538       (538)         - 
                                ---------  ---------------  -----------------  ----------  -------- 
 Balance at 31 December 
  2021                             35,805           10,241             21,321         423    67,790 
                                ---------  ---------------  -----------------  ----------  -------- 
 FX difference on translation         312            1,014              1,207          38     2,571 
 Additions                              -                -              2,189         827     3,016 
 Disposals                              -                -               (15)           -      (15) 
 Balance at 30 June 
  2022                             36,117           11,255             24,702       1,288    73,362 
                                ---------  ---------------  -----------------  ----------  -------- 
 
 Accumulated amortisation 
 Balance at 31 December 
  2020                                  -            1,157              8,124           -     9,281 
                                ---------  ---------------  -----------------  ----------  -------- 
 Charge for the period                  -              250                821           -     1,071 
 Balance at 30 June 
  2021                                  -            1,407              8,945           -    10,352 
                                ---------  ---------------  -----------------  ----------  -------- 
 FX difference on translation           -             (13)                 37           -        24 
 Charge for the period                  -              253              1,487           -     1,740 
                                ---------  ---------------  -----------------  ----------  -------- 
 Balance at 31 December 
  2021                                  -            1,647             10,469           -    12,116 
                                ---------  ---------------  -----------------  ----------  -------- 
 FX difference on translation           -              166                453           -       619 
 Charge for the period                  -              265              1,612           -     1,877 
 Disposals                              -                -               (15)           -      (15) 
 Balance at 30 June 
  2022                                  -            2,078             12,519           -    14,597 
                                ---------  ---------------  -----------------  ----------  -------- 
 
 Net book value 
                                ---------  ---------------  -----------------  ----------  -------- 
 At 31 December 2020               35,802            8,987              9,006         222    54,017 
                                ---------  ---------------  -----------------  ----------  -------- 
 At 30 June 2021                   35,716            8,554              9,721         396    54,387 
                                ---------  ---------------  -----------------  ----------  -------- 
 At 31 December 2021               35,805            8,594             10,852         423    55,674 
                                ---------  ---------------  -----------------  ----------  -------- 
 At 30 June 2022                   36,117            9,177             12,183       1,288    58,765 
                                =========  ===============  =================  ==========  ======== 
 

The Group tests annually for impairment, or more frequently if there are indicators that goodwill might be impaired. There were no such indicators in the Period.

   7.     PROPERTY, PLANT AND EQUIPMENT 
 
                                    Fixtures    Computer   Right-of-use 
                                and fittings    hardware         Assets     Total 
                              --------------  ----------  -------------  -------- 
                                     GBP'000     GBP'000        GBP'000   GBP'000 
 Cost 
 Balance at 31 December 
  2020                                 3,713       2,708         12,795    19,216 
                              --------------  ----------  -------------  -------- 
 Impact of foreign exchange 
  translation                           (35)        (18)          (129)     (182) 
 Additions                                20         237            269       526 
 Disposals                                 -           -          (175)     (175) 
 Balance at 30 June 2021               3,698       2,927         12,760    19,385 
                              --------------  ----------  -------------  -------- 
 Impact of foreign exchange 
  translation                             54          16            174       244 
 Additions                               140         283            192       615 
 Disposals                                 -           -          (342)     (342) 
 Balance at 31 December 
  2021                                 3,892       3,226         12,784    19,902 
                              --------------  ----------  -------------  -------- 
 Impact of foreign exchange 
  translation                            208         101            758     1,067 
 Additions                               114         330          2,388     2,832 
 Disposals                                 -        (69)        (1,713)   (1,782) 
                              --------------  ----------  -------------  -------- 
 Balance at 30 June 2022               4,214       3,588         14,217    22,019 
                              --------------  ----------  -------------  -------- 
 
 Accumulated depreciation 
 Balance at 31 December 
  2020                                 2,935       1,977          5,202    10,114 
                              --------------  ----------  -------------  -------- 
 Impact of foreign exchange 
  translation                           (22)         (9)           (30)      (61) 
 Charge for the period                    93         161            732       986 
 Disposals                                 -           -          (114)     (114) 
                              --------------  ----------  -------------  -------- 
 Balance at 30 June 2021               3,006       2,129          5,790    10,925 
                              --------------  ----------  -------------  -------- 
 Impact of foreign exchange 
  translation                             38          19             50       107 
 Charge for the period                    89         175            736     1,000 
 Disposals                                 -           -           (57)      (57) 
                              --------------  ----------  -------------  -------- 
 Balance at 31 December 
  2021                                 3,133       2,323          6,519    11,975 
                              --------------  ----------  -------------  -------- 
 Impact of foreign exchange 
  translation                            148          31            319       498 
 Charge for the period                   107         216            811     1,134 
 Disposals                                 -        (69)        (1,713)   (1,782) 
                              --------------  ----------  -------------  -------- 
 Balance at 30 June 2022               3,388       2,501          5,936    11,825 
                              --------------  ----------  -------------  -------- 
 
 Net book value 
                              --------------  ----------  -------------  -------- 
 Balance at 31 December 
  2020                                   778         731          7,593     9,102 
                              --------------  ----------  -------------  -------- 
 Balance at 30 June 2021                 692         798          6,970     8,460 
                              --------------  ----------  -------------  -------- 
 Balance at 31 December 
  2021                                   759         903          6,265     7,927 
                              --------------  ----------  -------------  -------- 
 Balance at 30 June 2022                 826       1,087          8,281    10,194 
                              ==============  ==========  =============  ======== 
 
 
 
 Right-of-use Assets - net book    Unaudited   Unaudited        Audited 
  value                               Period      Period     Year ended 
                                       ended       ended    31 December 
                                     30 June     30 June           2021 
                                        2022        2021 
                                  ----------  ----------  ------------- 
                                     GBP'000     GBP'000        GBP'000 
 Leasehold property                    8,118       6,710          6,069 
 Fixtures and fittings                   127         184            140 
 Computer hardware                        36          76             56 
                                  ----------  ----------  ------------- 
                                       8,281       6,970          6,265 
                                  ==========  ==========  ============= 
 

8. INVENTORIES

Inventory levels are higher at the June period end compared to December predominantly due to higher levels of stock in transit to satisfy higher sales activity in the second half of the financial year to December.

9. LEASES

Amounts recognised in the consolidated statement of financial position

In addition to the right-of-use assets included within note 7, the consolidated statement of financial position shows the following amounts relating to leases:

 
                                                 Unaudited   Unaudited        Audited 
                                                    Period      Period     Year ended 
                                                     ended       ended    31 December 
                                                   30 June     30 June           2021 
 Lease liabilities                                    2022        2021 
                                                ----------  ----------  ------------- 
                                                   GBP'000     GBP'000        GBP'000 
 Maturity analysis - contractual undiscounted 
  cash flows: 
 Less than one year                                  2,063       1,818          1,716 
 More than one year, less than two years             1,873       1,529          1,440 
 More than two years, less than three 
  years                                              1,633       1,330          1,273 
 More than three years, less than four 
  years                                              1,637       1,173          1,200 
 More than four years, less than five 
  years                                              1,418       1,193          1,202 
 More than five years                                2,685       2,872          2,338 
                                                ----------  ----------  ------------- 
 Total undiscounted lease liabilities 
  at period end                                     11,309       9,915          9,169 
 Finance costs                                     (1,512)     (1,425)        (1,397) 
                                                ----------  ----------  ------------- 
 Total discounted lease liabilities 
  at period end                                      9,797       8,490          7,772 
                                                ----------  ----------  ------------- 
 
 Lease liabilities included in the 
  statement of financial position: 
 Current                                             1,612       1,422          1,384 
 Non-current                                         8,185       7,068          6,388 
                                                ----------  ----------  ------------- 
                                                     9,797       8,490          7,772 
                                                ----------  ----------  ------------- 
 

Amounts recognised in the consolidated income statement

The consolidated income statement shows the following amounts relating to leases:

 
                                                Unaudited   Unaudited        Audited 
                                                   Period      Period     Year ended 
                                                    ended       ended    31 December 
                                                  30 June     30 June           2021 
                                                     2022        2021 
                                               ----------  ----------  ------------- 
                                                  GBP'000     GBP'000        GBP'000 
 Depreciation charge - fixtures and fittings          788         710          1,424 
 Depreciation charge - computer hardware               23          22             44 
                                               ----------  ----------  ------------- 
                                                      811         732          1,468 
                                               ==========  ==========  ============= 
 
 Interest expense (within finance expense)            213         197            381 
                                               ==========  ==========  ============= 
 
 

10. FINANCIAL INSTRUMENTS

The fair values of all financial instruments included in the consolidated statement of financial position are a reasonable approximation of their carrying values.

11. SHARE-BASED PAYMENTS

The Group operates equity-settled share-based payment plans for certain employees of the Group under The Pebble Group plc LTIP and The Pebble Group plc Group SAYE.

On 29 March 2022, under the LTIP, the Group made awards of 1,719,986 conditional shares to certain Directors and employees.

The Group recognised total expenses of GBP638,000 (period ending 30 June 2021: GBP229,000) in respect of equity-settled share-based payment transactions for the period ended 30 June 2022.

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END

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September 06, 2022 02:00 ET (06:00 GMT)

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