TIDMTRD
RNS Number : 2936C
Triad Group Plc
12 June 2023
Legal Entity Identifier (LEI) No. 213800MDNBFVEQEN1G84
Triad Group Plc ("Triad" or "the Company")
Audited results for the year ended 31 March 2023
(Company number: 02285049)
Triad Group Plc is pleased to announce its audited results for
the year ended 31 March 2023.
The Board is proposing a final dividend of 4p per share,
bringing the total dividend to 6p for the financial year. The
dividend is subject to shareholder approval at the Annual General
Meeting ("AGM"), and details of the AGM will be announced at the
appropriate time.
For further information, please contact:
Triad Group Plc
James McDonald
Finance Director and Company Secretary
Tel: 01908 278450
Zeus Capital Limited
Alexandra Campbell-Harris
Tel: 020 7614 5900
Strategic report
Financial highlights
Year ended Year ended
31 March 2023 31 March 2022 Difference
--------------------------------- --------------- --------------- -----------
Revenue GBP14.9m GBP17.0m -GBP2.1m
--------------------------------- --------------- --------------- -----------
Gross Profit GBP3.5m GBP4.8m -GBP1.3m
--------------------------------- --------------- --------------- -----------
Gross Profit % 23.6% 28.1% -4.5%
--------------------------------- --------------- --------------- -----------
Profit before tax GBP0.0m GBP1.1m -GBP1.1m
--------------------------------- --------------- --------------- -----------
(Loss)/Profit after tax (GBP0.0m) GBP1.2m -GBP1.2m
--------------------------------- --------------- --------------- -----------
Cash reserves GBP4.8m GBP5.3m -GBP0.5m
--------------------------------- --------------- --------------- -----------
Basic (loss)/earnings per share (0.27p) 7.16p -7.43p
--------------------------------- --------------- --------------- -----------
Final dividend - proposed 4p 4p -
--------------------------------- --------------- --------------- -----------
Chairman's statement
Dr John Rigg
Financial headlines
For the year ended 31 March 2023 the Group reports revenue of
GBP14.9m (2022: GBP17.0m). The gross profit as a percentage of
revenue has reduced to 23.6% (2022: 28.1%) primarily as a result of
reduced levels of consultant utilisation in the first half. The
profit before tax reduced to GBP9k (2022: GBP1.1m). The loss after
tax was GBP44k (2022: profit GBP1.2m). Cash reserves have reduced
to GBP4.8m (2022: GBP5.3m). The reasons for this performance is
explained below.
The first half performance was negatively impacted by the
external economic and political environment, but the Group
recovered in the second half of the year primarily through
achieving new business wins. Total revenue in the year reduced by a
net GBP2.1m due to the ongoing increase of consultancy revenues as
a proportion of total revenue, serviced by permanent fee earning
consultants. Gross profit as a percentage of revenue has reduced to
23.6% (2022: 28.1%) due to the increased number of consultants
temporarily off charge in the first half of the year. This is in
any case a requirement if we are to have the capacity and rapid
reaction capability to achieve future growth. Cash has reduced by
GBP0.5m during the year to GBP4.8m (2022: GBP5.3m), which is the
net effect of improved operating cash flows offset by a larger
dividend distribution to shareholders.
Overview of results
In my statement dated 30th November 2022 regarding the first
half results, I said that "Although the results for the first half
are obviously disappointing, I must emphasise that they are
entirely due to external factors beyond our control". I also said
that the outlook was extremely positive. I am now delighted to
report that my optimism has proved to be fully justified. During
the second half of the financial year, we have retrieved the losses
reported in the unaudited interim financial statements of the first
half and I regard this as a remarkable achievement on the part of
the Directors and staff of the Group, for which I tender my
wholehearted thanks and appreciation.
Outlook
Our vital signs continue to be extremely strong. Staff turnover
is very low, our recruitment of the highest quality consultants
continues apace, cash flow is very healthy, and the quality of our
work is being rewarded by impressive levels of compliment from our
major clients. Our margins and overhead control continue to be
extremely robust. The comments I made regarding the future in my
'Outlook' statement on the 30th November are still totally valid.
We have successfully ridden out the effects of the Covid-19
pandemic.
We are increasingly focusing our executive Board and senior
management on outward facing activity in order to raise our profile
and continue to create long term relationships of trust and
confidence with our major clients and new ones to come. This
reflects the next stage in regaining our traditional culture as a
consultant led, high quality, boutique operation, after significant
strengthening of the management structure.
Our corporate strategy is based on the longer term and we
believe the Group is capable of organically expanding substantially
and in a quality controlled way for a number of years to come,
which of course should be reflected in profits and dividends. I
look forward to the future with great enthusiasm.
Board Update
On 1 June 2023, positive steps were taken to consolidate and
strengthen the Triad Board with the promotion of non-Executive
Director Charlotte Rigg to Deputy Executive Chairman and the
appointment of Alison Lander to the position of non-Executive
Director. Charlotte was appointed to the Board as non-Executive
Director on 1 January 2020, and during her time with the business
has proven to be an invaluable member of the Board. Alison has many
years' experience in the IT sector, including an extensive working
relationship with Triad, and her appointment will bring relevant
and valuable experience to the Board.
Dividend
Recognising the strength of this year's performance and the
Group's confidence in the near future, the Board proposes a final
dividend of 4p per share (2022: 4p per share), which together with
the interim dividend already paid of 2p (2022: 2p per share),
totals 6p per share for the financial year (2022: 6p per
share).
Employees
On behalf of the Board of Directors, I would like to thank all
of the staff for their commitment and contribution during a very
important year.
Dr John Rigg
Executive Chairman
9 June 2023
Managing Director's statement
Adrian Leer
Business commentary
The Chairman has set out some of the external macro conditions
that made for a challenging first half. I am delighted with the way
in which our teams responded to that difficult first half,
resulting in a profit for the year overall.
The company has made some bold changes to its operating model, a
happy consequence of which has been a significant increase in
consultant headcount. With nearly twice the number of consultants
since 2021, it has been critically important to retain the Triad
culture that has permeated through the business for nearly 35
years. The combination of challenges and rewarding work throughout
the year has seen that culture not only preserved but enriched. We
now have a strong platform for future headcount growth that does
not compromise the quality of service cherished by our clients.
When it comes to client delivery, the year saw another
significant contribution to improving public services in the UK, a
source of great pride and satisfaction to all in the company.
Highlights included the delivery of an array of project outcomes
into the Ministry of Justice. Our team of project management and
programme management specialists were involved in projects
including digital prisons, technology delivery into prison cells,
legacy platform retirement initiatives, and counter-fraud
interventions. The service has bent and flexed to accommodate a
range of challenging objectives, whilst consistently impressing the
customer.
Elsewhere, we have enjoyed similar success at the erstwhile
Department of Business, Energy and Industrial Strategy (BEIS).
Operating across several discrete contracts, we have supported BEIS
in the areas of project management, agile delivery, software
development, platform migration and technical architecture.
Highlights have included the successful launch of a case management
system within the Office of Product Safety and Standards, being
part of a mixed supplier/client team that won the accolade of
"Information Records Management Team of the Year" and completing
the Discovery stage for the Clean Heat Market Mechanism service.
The latter assignment cementing our position as one of the digital
leaders in the net zero space.
At Department for Transport, we successfully steered the Road
Transport Greenhouse Gas Service product through a GDS Beta
assessment; no mean feat for a system of such complexity. It was
particularly pleasing to pick up a range of positive comments,
including the extent to which our user research activities
addressed the accessibility needs of a wide range of users,
including those who identified as dyslexic.
Our law enforcement footprint increased significantly during the
year. On top of work with our long-term national law enforcement
client, we also delivered projects concerned with the digital
implementation of recent law enforcement legislation as it relates
to international crime. Our relationship with the Home Office's
Accelerated Capability Environment (ACE) went from strength to
strength, and we became one of the select ACE Core+ partners within
the ACE community. A source of real advantage is that over 90% of
our consultants are already security-cleared, meaning that we have
been able to mobilise teams at short notice to work within
sensitive domains.
From a public sector perspective, it is extremely gratifying to
see that our work is directly helping to make the country safer,
cleaner, greener and more efficient. Within the private sector, we
successfully completed our delivery programme within Westcoast. The
Westcoast CIO praised not only our delivery capabilities but also
upskilling of the Westcoast team, enabling them to utilise the
latest engineering methods on a self-sufficient basis.
Our Microsoft 365 specialists continued to offer solutions to a
range of clients including Electoral Commission, RES, QEnergy and
BEIS. In all cases, clients are relying on us for the benefits of
low-code solutions which are as robust and durable as their more
engineered cousins.
Our user centred design team have continued to combine the
latest academic thinking with creative approaches to championing
the needs of the user, resulting in the delivery of systems which
are a pleasure to use.
Routes to market were improved during the year with successful
enrolment on to the National Highways ITC Framework, in addition to
ongoing participation in frameworks including DOS, G-Cloud, and
Digital Services & Programmes.
Significant investment went into the development of our
"Communities of Practice" model. The three practice areas cover (a)
business analysis, user research, and user experience (b) technical
and (c) delivery management, project management and PMO. Every
consultant is a member of at least one practice area, and these are
self-organising groups that seek to develop the collective
skill-base to continuously improve our client offering. Cutting
across the practice areas we developed "The Model Consultant"
framework, aimed at producing a consistently rewarding experience
for our clients and providing staff with a means of continuous
professional development. The solidification of these support
systems during the year is a crucial part of preparing the company
for further headcount development.
Beyond delivery, the company has continued to contribute to the
greater good. A number of volunteers took part in the "Boycott your
Bed" campaign run by the charity Action for Children. The company
also achieved level two status on the "Disability Confident"
employer scheme, and we continued to support the TechTalent Charter
in its quest to make the technology sector more accessible. The
Company also provided mentoring services to students from Hull and
Northampton universities, and is contributing actively to the
Digital Justice and the Central Government supplier forums
facilitated by the industry body TechUK.
Looking forward, it is pleasing to note that we start the new
year with a significant contract to deliver the Alpha and Beta
stages of the Clean Heat Market Mechanism, following a competitive
tendering process after the Discovery stage. With significant
extensions in place across a number of existing clients, and a
number of promising bids in the pipeline, we are well positioned to
build on the momentum created within the second half of last year.
We hope that Crown Commercial Services makes good on its commitment
to restore the levels of transparency associated with the now
defunct Digital Marketplace in the replacement platform, as this is
a key ingredient in helping suppliers understand how best to
support buyers' needs.
I would like to echo the Chairman's vote of thanks to our staff
for their outstanding contributions, and to our clients for
allowing us the opportunity to support them in their
objectives.
Adrian Leer
Managing Director
9 June 2023
Organisation overview
Triad Group Plc is engaged in the provision of information
technology consultants to deliver technology-enabled business
change to organisations in the public sector, private sector, and
not-for-profit sector.
Business model
The Group provides a range of consultancy services to clients to
help them deliver a tangible return on their investment in
technology. Our primary engagement model is to deliver these
services via our permanent consultants, sometimes augmented by
carefully selected associates. We rely upon our in-house resourcing
team to provide both permanent and associate staff, ensuring that
we maintain tight control of our supply chain and quality at all
times.
Our services span the delivery life cycle from high level
consulting, early strategy, programme management, project delivery,
software delivery, and support activities.
The Group operates mainly in the United Kingdom. Our workforce
is increasingly distributed across the UK too, and we have
permanent office space in Godalming (registered office) and Milton
Keynes.
Principal objectives
The principal objectives of the Group are to;
-- Provide clients with industry leading service in our core skills.
-- Achieve sustainable profitable growth across the business and
increase long term shareholder value.
The key elements of our strategy to achieve our objectives
are;
To provide a range of specialist services relevant to our
clients' business
-- Our services include consultancy, change leadership, project
delivery, software development and business insights. Further
capacity and expertise may be provided via our associate
network.
-- We continue to adopt a "business first, technology second"
approach to solving our clients' problems. A cornerstone of our
service offer is our consultancy model, offering advice and
guidance to clients in terms of technology investments.
To develop long term client relationships across a broad client
base
-- Enduring client relationships fuel profitability. A hallmark
of our trading history has been the frequency of repeat business,
which itself has been a function of outstanding delivery and
proactive business development within existing accounts.
-- Our consistent track record in this regard is our major asset
when developing propositions for new clients, along with the use of
case studies and references.
-- We have structured our service offering to enable clients to
engage early, thus enabling the building of trust and confidence
from the outset.
To work with partners
-- Our strategy includes working with carefully chosen partners
operating under their client frameworks in addition to the
frameworks on which Triad is listed. This will expose more
opportunities whilst reducing the cost of sale.
To leverage group capability and efficiency to increase
profitability
-- We continue to develop synergies across the Group's
activities both externally and internally, driving better outcomes
for clients whilst improving efficiency and effectiveness. The
management team sets objectives to ensure that these synergies are
exploited.
-- We enable our clients to benefit from access to a full range
of IT services, delivered through a single, easy to access, point
of sale.
-- We will continue to provide the highest quality of service to
our customers through our teams of skilled consultants and market
experts.
Principal risks and uncertainties
The Group's business involves risks and uncertainties, which the
Board systematically manages through its planning and governance
processes.
The Board has conducted a robust assessment of the principal
risks facing the Group, examining the Group's operating
environment, scanning for potential risks to the health and
wellbeing of the organisation. The Directors factor into the
business plan the likelihood and magnitude of risk in determining
the achievability of the operational objectives. Where feasible,
preventive and mitigating actions are developed for all principal
risks.
Senior management review the risk register and track the status
of these risk factors on an on-going basis, identifying any
emerging risks as they appear. Regular meetings are held between
the Executive Chairman and the Managing Director to ensure risks
are identified and communicated.
The outputs of this management review form part of the Board's
governance process, reviewed at regular Board meetings. When
emerging risks arise, these are reviewed by senior management on an
immediate basis and communicated to the Board as appropriate.
The principal risks identified are:
IT services market
The demand for IT services is affected by UK market conditions.
This includes, for example, fluctuations in political and economic
uncertainty, and the level of public sector spending. Negative
impacts can reduce revenue growth and maintenance due to the loss
of key clients, reduction in sales pipelines and reduction in
current services. The creation of new services, acquisition of new
clients and the development of new commercial vehicles are
important in protecting the Group from fluctuations in market
conditions.
Economy
The political and economic uncertainty generated by Brexit still
has the potential negatively to affect the Group's marketplace due
to an impact on Government spending plans and the cancellation or
delay of IT projects. The strong relationships the Group enjoys
with a large range of public sector clients within the UK mitigated
this risk during the year. During and following the Brexit
transition, the Group continued to build strong trading
partnerships with EU based companies. Due to the current lack of
restrictions of trading digital services within the EU, the
Directors do not foresee this changing in the future.
Due to the nature of the Group's client base and activities in
the UK, the current conflict in Ukraine has not had a direct
impact, and is not considered to do so in the future, however there
may be a secondary effect as a result of the impact on the wider
economy. The Directors will continue to monitor this situation
closely.
Inflationary pressures and the challenging interest rate
environment in the UK mainly affect the Group's ability to attract
and retain staff as wage inflation will continue to be a risk to
the business. The Group's response to this risk is outlined within
the Availability of staff below.
Revenue visibility
The pipeline of contracted orders for time and materials
consultancy work can be relatively short and this reduces
visibility on long-term revenue generation. Political uncertainty,
particularly in the public sector, can reduce visibility in
securing new business. The Board carefully reviews forecasts to
assess the level of risk arising from business that is forecast to
be won and maintains very strong relationships with key client
relationships.
Availability of staff
In an extremely difficult market for talent acquisition, the
ability to access appropriately skilled resources, recruit and
retain the best quality staff is key to ensuring the ability to
deliver profitable growth and deliver IT services to our clients.
This situation has been exacerbated by the cost of living crisis
which has resulted in general inflation increases. The Group
continues to recruit the best quality individuals and ensures a
resilient network of associate resources is scaled appropriately to
meet the demands of the business. To mitigate these risks, the
Group reviews remuneration and benefits on an annual basis and
adjusts these accordingly within market rates. In addition, the
Group operates a Company-wide staff development programme to ensure
continuous personal growth and consistent staff engagement. The
on-boarding of new consultants is managed by a highly experienced
and dedicated team of resourcing professionals, and this provides
quality assurance processes to accelerate hiring and reduce
attrition.
Competition
The Group operates in a highly competitive environment. The
markets in which the Group operates are continually monitored to
respond effectively to emerging opportunities and threats. The
Group ensures a high quality of service to long-tenured clients,
which includes continuous review of delivery against project plan
and obtaining client feedback. This promotes longevity of client
relationships and to a high degree mitigates the risk of
competition.
The risk associated with environmental, social and corporate
governance (ESG) is considered to be low, although the group takes
its responsibilities in this regard very strongly. Details of these
responsibilities can be found on page 10 .
There are or may be other risks and uncertainties faced by the
Group that the Directors currently deem immaterial, or of which
they are unaware, that may have a material adverse impact on the
Group.
The risk appetite of the Group is considered in light of the
principal risks and their impact on the ability to meet its
strategic objectives. The Board regularly reviews the risk appetite
which is set to balance opportunities for business development and
growth in areas of potentially higher risk, whilst maintaining
reputation, regulatory compliance, and high levels of customer
satisfaction.
Section 172 statement
Section 172 of the Companies Act 2006 requires Directors to take
into consideration the interests of key stakeholders in the Group
in their decision making. Engagement with the Group's stakeholders
is essential to successfully managing the business and the
effectiveness of this engagement helps to understand the impact of
key decisions on stakeholders.
The Board has identified the key stakeholders as shareholders,
clients, partners, employees and suppliers.
-- Shareholders: Shareholders play a significant part in
deciding the direction of the business. Dialogue is maintained with
shareholders and their advisors and issues of significance are
communicated to shareholders as necessary. In addition, a full
shareholder briefing is presented at the Group's annual general
meeting of shareholders. Despite the political uncertainty in the
first half of the financial year which negatively impacted the
business, the Board awarded an interim dividend of 2p per share
(2022: 2p per share) to shareholders. This decision was made
following a detailed review of second half profitability and cash
flow which showed a material improvement. The Board has proposed a
final dividend of 4p per share for the year ended 31 March 2023 due
to the recent trading performance and expected cash flows (2022: 4p
per share).
-- Clients: Delivering a quality service is the key to the
Group's future success, and effective and successful delivery of
services to our clients is the key focus of the Group. To increase
effectiveness, a constant review of utilisation rates and delivery
structures has been undertaken to enhance the efficiency of the
Group's service to clients. Key account delivery and management
tools have also been reviewed and enhanced to promote efficiencies.
The Group continues the strategy of building permanent consultant
numbers to improve and broaden the skill sets and enhance delivery
to clients, and utilise associates only on a limited basis where
rare technical expertise is required.
-- Partners: Effective working relationships that enable future
growth are important to the Group. The Group continue to cultivate
strong relationships with our business partners, which may include
intermediaries and sub-vendor arrangements, with regular dialogue
and updates to ensure that delivery to our shared clients is as
effective as possible. During the financial year, the Group
continued to explore delivery methods with partners that enable the
acquisition of new business.
-- Employees: Motivated and satisfied employees are the
lifeblood of our business and our people are key to our success.
The Group strives to achieve the highest standards in its dealings
with all employees. During the financial year, the Group continued
to deliver a high level of communication with employees, including
regular Group meetings chaired by the Managing Director. One-to-one
meetings with employees and the Managing Director are also
available on request, which regularly take place. The Group
continued to provide appropriate comprehensive induction and
ongoing training tailored to individual needs. Extensive employee
benefits are provided which are continually reviewed to enhance the
wellbeing of all employees. Remuneration packages are reviewed on
an annual basis to ensure retention of employees, as are flexible
working environments and grading reviews. During the year ended 31
March 2022, the new Triad Employee Share Incentive Plan was
implemented, which facilitates awards of restricted stock units
(RSUs) to employees from time to time within allowable limits. See
page 37 for details.
-- Suppliers: Effective engagement with suppliers enables the
Group to deliver a quality service to our clients. The Group
maintains appropriate arm's-length trading relationships with
quality suppliers and is fully committed to fairness in its dealing
with them, including embracing the principle of paying suppliers
within agreed credit terms during the course of normal
business.
The Directors continue to ensure there is full regard to the
long-term interests of both the Group and its key stakeholders
including the impact of its activities on the community, the
environment and the Group's reputation. In doing this, the
Directors continue to act fairly and in good faith taking into
account what is most likely to promote the long-term success of the
Group.
-- Relations with key stakeholders such as shareholders,
employees, and suppliers are maintained by regular, open and honest
communication in both verbal and written form.
-- The Directors are fully aware of their responsibilities to
promote the success of the Group in accordance with section 172 of
the Companies Act 2006.
-- The Directors continuously take into account the interests of
its principal stakeholders and how they are engaged. This is
achieved through information provided by management and also by
ongoing direct engagement with the stakeholders themselves.
-- The Board has ensured an appropriate business structure is in
place to ensure open and effective engagement with the workforce
via the Executive Directors and the senior management team.
-- The Board and the senior management team continue to work
responsibly with all relevant stakeholders and has appropriate
anti-corruption and anti-bribery, equal opportunities and
whistleblowing procedures and policies in place.
-- As required, non-Executive Directors, professional advisors
and the Company Secretary provide support to the Board to help
ensure that sufficient consideration is given to stakeholder
issues.
Viability statement
In accordance with the Listing Rules the Directors have assessed
the Company's viability over the next three financial years. Given
the Group's business model and commercial and financial exposures
the Directors consider that three years is an appropriate period
for the assessment. The maximum period of visibility of commercial
arrangements with clients is currently two years, however in
considering the assessment period assumptions have been made beyond
this immediate timeframe based upon the strategic direction of the
business. As part of the long-term viability assessment the
Directors have considered the principal risks.
This assessment of viability has been made with reference to the
Group's current financial and operational positions. Revenue
projections, cash flows, availability of required finance,
commercial opportunities and threats, and the Group's experience in
managing adverse conditions in the past have been reviewed. The
Group was founded in 1988 and has survived several recessions.
An example of the robust performance of the business model was
the successful navigation of the Covid-19 pandemic. Despite the
overwhelming threat the pandemic presented, the Group was able to
improve profitability and increased cash reserves without the
requirement for external funding or needing to take advantage of
Government support schemes. This success was due to the agility of
the business model, client delivery techniques and the quality of
our employees and hiring processes.
Brexit has had no material negative impact upon the Group's
client base and trading results. In some areas trading
relationships have increased with new EU and European trading
partners, and this is expected to improve.
The effects of IR35 legislation is minimal as the Group has
continued to reduce associate fee earners in favour of higher
margin permanent employees. The risk in this area is not considered
material.
The Directors have approached the budget and forecasting cycle
for the 2024 financial year with a conservative outlook, but are
confident in the business model and the ability of the highly
skilled and long tenured consultants to improve upon these
conservative expectations.
The viability assessment considered the principal risks as set
out on page 6 . The Board modelled a number of realistic scenarios
based upon conservative budgets and forecasts. This included
modelling the most severe scenario possible which assumed that all
current client contracts discontinued at expiry, with no extension
or replacement and with no further cost mitigation. The group have
extended at a high level these forecasts to 3 years for the
purposes of considering viability.
In all scenarios, it was found that there was sufficient
headroom in cash flow to continue operating within current
resources for the next 18 months, and without the requirement to
utilise the available financing facility as detailed in note 3, or
procure further external funding. The Group was therefore found to
have sufficient financial strength to withstand considerable
financial headwinds.
The Board believes that the Group remains well placed to
navigate effectively a prolonged period of uncertainty and to
mitigate the risks presented by it.
Based upon the results of this analysis, the Board has a
reasonable expectation that the Group will be able to continue in
operation and be able to meet its liabilities over the next 3-year
viability period. In reaching this assessment, the Board has taken
into account future trading, access to external funding and cash
flow expectations.
Performance assessment, financial review and outlook
Financial and non-financial key performance indicators (KPIs)
used by the Board to monitor progress are revenue, profit from
operations, EBITDA, gross margin and headcount. Financial KPIs are
discussed in more detail in the Financial review below. The outlook
for the Group is discussed in the Chairman's statement on page 1
.
The KPIs are as follows;
2023 2022
========================================================================== ============== ===============
Revenue GBP14,858,000 GBP17,015,000
========================================================================== ============== ===============
Profit from operations GBP35,000 GBP1,108,000
========================================================================== ============== ===============
Earnings before interest, tax, depreciation and amortisation (EBITDA)(1)
GBP308,000 GBP1,379,000
========================================================================== ============== ===============
Gross margin 23.6% 28.1%
========================================================================== ============== ===============
Average headcount 115 104
(1) EBITDA - Profit from operations of GBP35,000 (2022:
GBP1,108,000) adding back the depreciation and amortisation charge
in the year of GBP273,000 (2022: GBP271,000)
Corporate social responsibility
Our employees
The Group is committed to equal opportunities and operates
employment policies which are designed to attract, retain and
motivate high quality staff, regardless of gender, age, race,
religion or disability. The Group has a policy of supporting staff
in long term career development.
Culture and engagement
The Group recognises the importance of having effective
communication and consultation with, and of providing leadership
to, all its employees. The Group promotes the involvement of its
employees in understanding the aims and performance of the
business. An assessment of culture, engagement and future
contribution made to the business by employees is made at each
Board meeting and is considered a key aspect of the meetings. The
Board has been satisfied with policies and practices and they are
aligned with the Group's purpose and strategy and no corrective
action is required.
The Group strives to recruit and retain high quality employees
at the cutting edge of technology. A key engagement factor is the
continuous professional development of all staff and the Group is
committed to providing increased training and development
opportunities, to enhance both the expertise and engagement of our
workforce, and improving the quality of our services to our
clients.
Diversity and inclusion
Diversity and inclusion is a key component of working life in
the Group. Employees are encouraged to take an active role in
decision making and driving the business forward, including several
platforms within the business to share good practice, successes and
potential improvements. We continue to include diversity within our
recruitment policies and make improvements as appropriate.
The following table shows the average number of persons employed
during the year, by gender, who were Directors, senior managers or
employees of the Company.
Male Female Total
================= ===== ======= ======
Directors 6 1 7
================= ===== ======= ======
Senior managers 2 - 2
================= ===== ======= ======
Employees 75 31 106
================= ===== ======= ======
Total 83 32 115
The average female employees as a proportion of the total Group
employees continues to improve and during the year ending 31 March
2023 this increased to 28% (2022: 26%).
The following table shows the gender identity and ethnic
background of the board and senior management team during the
year.
Number of Board Percentage of the Number of senior Number in the Percentage of
members Board positions on the senior management senior management
Board team
=================== ================== ================== ================= ================== ==================
Men 6 86% 4 2 100%
=================== ================== ================== ================= ================== ==================
Women 1 14% - - -
=================== ================== ================== ================= ================== ==================
White British or
other White 7 100% 4 2 100%
The appointment of Alison Lander to the Board on 1 June 2023 has
increased the female representation on the Board to 25%. The Board
consists of mainly long Triad Group tenured Directors, and with
respect to both female and non - white British directors, there are
no specific plans to increase representation other than continuing
to recruit and nurture the best available talent, regardless of
gender or ethnicity.
Environment and greenhouse gas reporting
This statement contains the Group's TCFD aligned disclosure in
accordance with FCA requirements of Premium Listed UK Corporates.
We have not yet completed planning for different climate related
scenarios, including 2 degree or lower, and expect to complete this
planning by March 2024. The Group has provided responses across the
TCFD's pillars and aims to advance the maturity of its
climate-related actions and disclosures on an annual basis. The
four pillars are as follows:
Governance - Governance of climate related risks and Assessing, identifying, and managing climate related
opportunities issues is part of the management team's
responsibilities. The Board are informed of any climate
related issues identified by the management
team as and when they arise. When an issue is identified,
the Board will monitor the progress
of addressing this issue on a relevant basis.
========================================================== ==========================================================
Strategy - Impacts of actual or potential climate No actual or potential impacts on the Group have been
related risks and opportunities analysed due to the limited impact of
climate related issues over the short, medium and long
term, including lower carbon economy
considerations and a 2degC or lower scenario, and these
have not been considered when making
strategic decisions. If, and when a risk is deemed to
have a greater impact, the Group will
follow the same process as identifying and assessing
other risks, described on page 6 .
The service nature of the business and the potential
downtime of consultants in between assignments,
means that climate risk is mitigated in this situation.
With the Group's workforce currently working remotely
from locations across the country and
having in excess of 3 years' remote working experience,
no localised climate issues will have
a material impact. The management team has assessed the
impact of the warnings from the National
Grid regarding the potential of localised planned
three-hour outages and have deemed this
to have no material impact. National climate related
risks, including electrical supply issues
to the entire country at a single time, have been deemed
exceptionally remote and not assessed.
There are no financial related disclosures due to the
immateriality of the risks, in line
with the TCFD recommendations.
The Group has been involved in climate related projects,
such as the Department for Transport's
Renewable Transport Fuels Obligation Operating System
(ROS) and with the Department for Business,
Energy and Industrial Strategy's Clean Heat Market
Mechanism discovery. This work and our
increased expertise in this area provides further
opportunities to be involved in future projects
of this nature.
========================================================== ==========================================================
Risk Management - identification, assessment, and
management of climate related risks Climate related risks are assessed as per other risks to
the Group, described on page 6 .
There are no regulatory requirements that would have a
material impact on the Group, and in
line with our Carbon Reduction Plan, the Group is moving
towards zero rated emissions by 2050.
========================================================== ==========================================================
Metrics - metrics and targets used to assess, manage and The Group's emissions per scope are detailed below in
report relevant climate-related risks line with SECR requirements, along with
and opportunities our KPIs of tCO(2) e per GBP1m of revenue and per
average total headcount, using the emission
factors from the Government's GHG Conversion Factors
2022.
Scope 1 - Combustion of fuel; one of the Group's offices
uses gas for heating, which due to
the current remote nature of the workforce is being used
at a minimum level for both properties.
A single company car is also being used where public
transport is not available.
Scope 2 - Electricity; both offices now are now supplied
by renewable energy suppliers, with
the small increase due to an increase in office visits.
Scope 3; this covers business travel and employee
commuting, with the increase of 13 tCO(2)
e due to an increased requirement for on-site working.
Our employees are encouraged to use
public transport where available.
In November 2022 the Group published its latest Carbon
Reduction Plan, available on our website,
committing to achieving Net Zero emissions by 2050. It
included a shorter-term target to reduce
carbon emissions by 18.1% to 150 tCO(2) e by 2025.
During the year, we have promoted remote
collaborative working to minimise travel, reduced paper
usage by >95% since our baseline emissions
calculation and changed to renewable energy suppliers at
both of our offices. The continuing
reduction will be achieved by continuing to embed a
degree of working from home as an ongoing
policy, finalise a paperless office environment,
increasing the profile of environmental issues
and the promotion of good practices through staff
communication channels. The management team
will continue to review the scope 1 and 2 emissions from
office activities and identify and
implement reductions through changes to policies and
practices. The current measurements remain
on target against this plan.
The Group has used mileage reports, public transport journey
details and meter readings converted to tCO(2) e using the 2022 UK
Government's conversion factors for company reporting of greenhouse
gas emissions.
The annual quantity of greenhouse gas (GHG) emissions for the
period 1 April 2022 to 31 March 2023 in tonnes of carbon dioxide
equivalents (tCO(2) e) for the Group is shown in the table below,
updated following reassessment of carbon footprint criteria:
GHG emissions 2023 2022
tCO(2) e(1) tCO(2) e(1)
Emission source:
====================================================== ============ ============
Scope 1 - Combustion of fuel 7 8
====================================================== ============ ============
Scope 2 - Electricity and heat purchased for own use 29 26
------------------------------------------------------ ------------ ------------
Total 36 34
====================================================== ============ ============
Scope 3 - Including business travel and commuting 24 11
------------------------------------------------------ ------------ ------------
Total 60 45
====================================================== ============ ============
tCO(2) e per GBP1m revenue 4.0 2.6
====================================================== ============ ============
FTE 115 104
====================================================== ============ ============
Intensity ratio (tCO(2) e per FTE) 0.5 0.4
(1) The calculation of tCO(2) e for each source has been
prepared in accordance with DEFRA guidelines for GHG reporting.
The annual energy consumed as a result of the purchase of
electricity and heat for the period 1 April 2022 to 31 March 2023
in kWh is shown in the table below:
2023 2022
=============================== ======== ========
Energy consumed (kWh) 151,355 124,397
=============================== ======== ========
kWh per GBP1m revenue 10,158 7,317
=============================== ======== ========
FTE 115 104
=============================== ======== ========
Intensity ratio (kWh per FTE) 1,316 1,196
The emissions are generated solely by activities in the UK.
Emissions generated by electricity consumption is 48% (2022:
59%).
The Group has not been subject to any environmental fines during
the year ended 31 March 2023 (2022: nil).
Social, community and human rights issues
Triad takes its responsibilities to the community and society as
a whole very seriously. With people at the core of our values,
during 2020 Triad was proud to have achieved its first Disability
Confident badge - Disability Confident Level 1 ("Committed"). To
show our continued commitment in this area, during the year we
achieved Disability Confident Level 2 ("Employer"), with the
ambition to move to the highest level (Level 3 - "Leader") over the
next 12 months.
We are using this to guide our practices, particularly with
regards to equality of opportunity for disabled staff and through
our recruitment process. An example of this is the introduction of
a Disability & Accessibility Network, which has been set up to
support Triad employees including those with physical and mental
impairments.
From becoming members of Tech Talent Charter in 2021, we have
continued to improve our monitoring of under-represented groups in
the workplace through the introduction of company-wide surveys on
social mobility and diversity, alongside updating our Equal
Opportunities Policy to reflect our commitments. We believe we are
working to make a real difference to inclusion and diversity within
our organisation and across the technology sector.
The Group actively supports charities. Managing Director Adrian
Leer is a board member of Action for Children, and our staff
participate in regular fund-raising activities for the charity,
promoted and supported by Triad. Further charitable donations made
in the year included The City of London Police Cadets, which helped
to fund extra-curricular development activities for young people
within the organisation.
There are no human rights issues that impact upon
operations.
Financial review
Group performance
Group revenue has decreased to GBP14.9m (2022: GBP17.0m) due to
an ongoing increase of consultancy revenues replacing associate led
assignments as a proportion of total revenue, serviced by permanent
fee earning consultants. Gross profit reduced to GBP3.5m (2022:
GBP4.8m), primarily due to the increased number of consultants
temporarily off charge in the first half of the year, and this has
also resulted in the gross profit as a percentage of revenue
reducing to 23.6% (2022: 28.1%) .
The Group reports a profit from operations before taxation of
GBP9k (2022: GBP1.1m). The reduction in profitability before tax of
GBP1.1m and the reduction in gross profit (GBP1.3m), was primarily
due to reduced consultant utilisation. This is offset by the
reduction in administrative personnel overheads of GBP0.2m. The
Group reports a loss after tax of GBP44k (2022: profit
GBP1.2m).
The balance sheet remains strong with no external debt, with the
exception of the lease liabilities arising due to the application
of IFRS 16, and the Group enjoys strong reserves of cash at GBP4.8m
(2022: GBP5.3m) and no bad debts (2022: nil).
Overheads
Administrative expenses for the year are GBP3.5m (2022:
GBP3.7m). The reduction of GBP0.2m was the net effect of a
reduction in administrative personnel costs derived from a
reduction in discretionary one-off payments of GBP0.3m, reduction
in other personnel related costs of GBP0.1m and an increase in
share-based payments of GBP0.2m and other personnel related costs.
Non-personnel costs remained static in the period.
Staff costs
Total staff costs have increased to GBP10.0m (2022: GBP8.6m)
(note 7) which is predominantly due to the increase in the average
fee earning consultant number to 93 (2022: 77) in line with the
Group's organic growth strategy. This growth in consultant numbers
has materially improved the ratio of fee earners to administration
staff to 19:1 (2022: 9:1).
Cash
Cash and cash equivalents as at 31 March 2023 reduced to GBP4.8m
(2022: GBP5.3m). The maintenance of working capital efficiencies
during the year resulted in a net cash inflow from operating
activities of GBP0.7m (2022: GBP1.2m). During the year, the Group
was not required to seek external funding and the Lloyds financing
facility remains unutilised. The net cash outflow from financing
activities was GBP1.3m (2022: outflow GBP0.8m), which included
dividends paid of GBP1.0m (2022: GBP0.7m). The net cash inflow from
investing activities was GBP0.1m (2022: outflow GBP0.01m)
reflecting the low investment in capital expenditure during the
period.
Non-current assets
Non-current assets excluding taxation increased by GBP0.4m
(2022: reduction GBP0.1m). This was due to the increase in the
right of use asset of GBP0.2m (2022: reduction GBP0.2m) and the
finance lease receivable of GBP0.4m (2022: reduction GBP0.1m) as
the lease break on one property was not taken, a reduction of
GBP0.08m was related to purchased assets (2022: increase GBP0.05m)
and trade receivables reduced by GBP0.1m (2022: increase
GBP0.1m).
Taxation
The Group adopts a low-risk approach to its tax affairs. The
Group does not employ any complex tax structures or engage in any
aggressive tax planning or tax avoidance schemes. The deferred tax
asset decreased to GBP0.11m (2022: GBP0.16m) in the year, mainly
due to the expectation that tax losses brought forward will be
offset against future profits at a relatively lower level (see note
8).
Net assets
The net asset position of the Group at 31 March 2023 was GBP5.2m
(2022: GBP6.0m). The effect of the non-enacted lease break on one
property increased total assets by GBP0.6m and total liabilities by
a corresponding GBP0.6m, and so no overall effect upon net assets
in the year. Further movements during the year are detailed on page
52 .
Share options and restricted stock units
A total of 43,084 options were exercised by staff during the
year (2022: 511,000). No further options were granted in the year
(2022: nil).
No restricted stock options (RSUs) were granted to either
Directors or staff during the year (2022: 750,000).
A share-based expense has been recognised in the year of
GBP200,128 (2022: GBP476).
Dividends
With the strong expectation of continued profitability and
future positive cash flows, the Board are proposing a final
dividend of 4p per share (2022: 4p per share), which together with
the interim dividend already paid of 2p (2022: 2p per share),
totals 6p per share for the financial year (2022: 6p per share).
See note 9.
By order of the Board
James McDonald
Finance Director
9 June 2023
Directors' report
The Directors present their Annual report on the activities of
the Group, together with the financial statements for the year
ended 31 March 2023. The Board confirms that these, taken as a
whole, are fair, balanced and understandable, and that they provide
the information necessary for shareholders to assess the Group's
and Company's position and performance, business model and
strategy, and that the narrative sections of the report are
consistent with the financial statements and accurately reflect the
Group's performance and financial position.
The Strategic report provides information relating to the
Group's activities, its business and strategy and the principal
risks and uncertainties faced by the business, including analysis
using financial and other KPIs where necessary. These sections,
together with the Directors' remuneration and Corporate Governance
reports, provide an overview of the Group, including environmental
and employee matters and give an indication of future developments
in the Group's business, so providing a balanced assessment of the
Group's position and prospects, in accordance with the latest
narrative reporting requirements. The Group's subsidiary
undertakings are disclosed in the note 14 to the financial
statements.
Corporate Governance disclosures required within the Directors'
report have been included within our Corporate Governance report
beginning on page 22 and form part of this report.
Share capital and substantial shareholdings
Share capital
As at 31 March 2023, the Company's issued share capital
comprised a single class of shares referred to as ordinary shares.
Details of the ordinary share capital can be found in note 19 to
these financial statements.
Voting rights
The Group's articles provide that on a show of hands at a
general meeting of the Company every member who (being an
individual) is present in person and entitled to vote shall have
one vote and on a poll, every member who is present in person or by
proxy shall have one vote for every share held. The notice of the
Annual General Meeting specifies deadlines for exercising voting
rights and appointing a proxy or proxies to vote in relation to
resolutions to be passed at the Annual General Meeting.
Transfer of shares
There are no restrictions on the transfer of ordinary shares in
the Company other than as contained in the Articles:
-- The Board may, in its absolute discretion, and without giving
any reason for its decision, refuse to register any transfer of a
share which is not fully paid up (but not so as to prevent dealing
in listed shares from taking place) and on which the Company has a
lien. The Board may also refuse to register any transfer unless it
is in respect of only one class of shares, in favour of no more
than four transferees, lodged at the Registered office, or such
other place as the Board may decide, for registration, accompanied
by a certificate for the shares to be transferred (except where the
shares are registered in the name of a market nominee and no
certificate has been issued for them) and such other evidence as
the Board may reasonably require to prove the title of the
intending transferor or his right to transfer the shares.
Certain restrictions may from time to time be imposed by laws
and regulations, for example:
-- Insider trading laws; and
-- Whereby certain employees of the Group require the approval
of the Company to deal in the Company's ordinary shares.
Appointment and replacement of directors
The Board may appoint Directors. Any Directors so appointed
shall retire from office at the next Annual General Meeting of the
Company but shall then be eligible for re-appointment.
The current Articles require that at the Annual General Meeting
one third of the Directors shall retire from office but shall be
eligible for re-appointment. The Directors to retire by rotation at
each Annual General Meeting shall include any Director who wishes
to retire and not offer themselves for re-election and otherwise
shall be the Directors who, at the date of the meeting, have been
longest in office since their last appointment or
re-appointment.
A Director may be removed from office by the service of a notice
to that effect signed by at least three quarters of all the other
Directors.
Amendment of the Company's Articles of Association
The Company's Articles may only be amended by a special
resolution passed at a general meeting of shareholders.
Substantial shareholdings
As at 31 March 2023, since the date of the last annual report in
May 2022, the Company had received the following notifications
relating to interests in the Company's issued share capital, as
required under the Disclosure and Transparency Rules (DTR 5) when a
notifiable threshold is crossed:
Percentage of issued share capital
M Needham and S Cook (as the joint trustees in bankruptcy of M Makar)
W Barbour 20.98%
5.03%
Since the year end, the Company received the following further
notifications:
Percentage of issued share capital
AM Fulton 3.00%
As at 9 June 2023, no further notifications have been received
since the year end.
Dividends
There was a 2p per share interim dividend paid during the year
(2022: 2p per share).The Directors propose a final dividend of 4p
per share (2022: 4p per share).
Financial instruments
The Board reviews and agrees policies for managing financial
risk. These policies, together with an analysis of the Group's
exposure to financial risks are summarised in note 3 of these
financial statements.
Research and development activity
Research and development activities are undertaken with the
prospect of gaining new technical knowledge and understanding and
developing new software. During the year, our activities included
the utilisation of a dedicated team to complete the development of
a unique lightweight SharePoint site provisioning tool, which would
provide a competitive advantage in the marketplace. Also of note, a
prototype service was also developed that will allow industry to
assess their exposure with respect to new heat pump legislation,
which builds upon on the Group's net zero experience and
credentials. None of the research and development activity met the
required criteria for capitalisation.
Directors' interests in contracts
Directors' interests in contracts are shown in note 21 to the
accounts.
Directors' insurance and indemnities
The Company maintains Directors' and Officers' liability
insurance which gives appropriate cover for any legal action
brought against its Directors and Officers. The Directors also have
the benefit of the indemnity provisions contained in the Company's
Articles of Association. These provisions, which are qualifying
third-party indemnity provisions as defined by Section 236 of the
Companies Act 2006, were in force throughout the year and are
currently in force.
Disclosure of information to auditor
All of the current Directors have taken all the steps that they
ought to have taken to make themselves aware of any information
needed by the Company's auditor for the purposes of their audit and
to establish that the auditor is aware of that information. The
Directors are not aware of any relevant audit information of which
the auditor is unaware.
Forward-looking statements
The Strategic report contains forward-looking statements. Due to
the inherent uncertainties, including both economic and business
risk factors, underlying such forward-looking information, the
actual results of operations, financial position and liquidity may
differ materially from those expressed or implied by these
forward-looking statements.
Going concern
The Group's business activities, together with the factors
likely to affect its future development, performance and position,
are set out in the Strategic report. The financial position of the
Group, its cash flows, liquidity position and borrowing facilities
are described in the Strategic report. In addition, note 3 to the
financial statements includes the Group's objectives, policies and
processes for managing its capital, its financial risk management
objectives, details of its financial instruments and hedging
activities, and its exposure to credit risk and liquidity risk. The
Group meets its day to day working capital requirements through
cash reserves and an invoice finance facility (which is currently
unutilised).
The Group operates an efficient low-cost and historically cash
generative model. The client base generally consists of large
blue-chip entities, particularly within the public sector, enjoying
long-term and productive client relationships. As such, debtor
recovery has been reliable and predictable with a low exposure to
bad debts. For the year ended 31 March 2023, the Group has not
utilised any external debt or the current finance facility.
The going concern assessment considered a number of realistic
scenarios covering the period ending 30 September 2024, including
the ability of future client acquisition, and the impact of the
reduction in services of key clients upon future cash flows. In
addition, in the most severe scenario possible, a reverse stress
test was modelled which included all current client contracts
discontinued at expiry with no extension or replacement and with no
cost mitigation. Even in the most extreme scenario, the Group has
enough liquidity and long-term contracts to support the business
through the going concern period. The Directors have concluded from
these assessments that the Group would have sufficient headroom in
cash balances to continue in operation.
Further information in relation to the Directors' consideration
of the going concern position of the Group is contained in the
Viability statement on page 8 .
After making enquiries, including a review of the wider economy
including Brexit, inflationary pressures and the Ukraine conflict,
the Directors have a reasonable expectation that the Group has
adequate resources to continue in operational existence for the
foreseeable future and at least twelve months from the date of
approval of the financial statements. Accordingly, they continue to
adopt the going concern basis in preparing the annual report and
accounts.
Auditor
BDO LLP have indicated their willingness to continue in office.
Accordingly, a resolution to reappoint BDO LLP as auditors of the
Company will be proposed at the next Annual General Meeting.
Environment and greenhouse gas reporting
Carbon dioxide emissions data is contained in the Corporate
social responsibility section of the Strategic report.
Statement of Directors' responsibilities
The Directors are responsible for preparing the annual report
and the financial statements in accordance with international
accounting standards in conformity with the requirements of the
Companies Act 2006 and applicable law and regulations.
Company law requires the Directors to prepare financial
statements for each financial year. Under that law the Directors
are required to prepare the Group financial statements and have
elected to prepare the Parent Company financial statements in
accordance with UK adopted international accounting standards
('IFRS'). Under company law the Directors must not approve the
financial statements unless they are satisfied that they give a
true and fair view of the state of affairs of the group and company
and of the profit or loss for the group for that period.
In preparing these financial statements, the Directors are
required to:
-- select suitable accounting policies and then apply them consistently;
-- make judgements and accounting estimates that are reasonable and prudent;
-- state whether they have been prepared in accordance with UK
adopted international accounting standards ('IFRS'), subject to any
material departures disclosed and explained in the financial
statements
-- prepare the financial statements on the going concern basis
unless it is inappropriate to presume that the group and the
Company will continue in business;
-- prepare a directors' report, a strategic report and
directors' remuneration report which comply with the requirements
of the Companies Act 2006.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Company's
transactions and disclose with reasonable accuracy at any time the
financial position of the Company and enable them to ensure that
the financial statements comply with the Companies Act 2006.
They are also responsible for safeguarding the assets of the
company and hence for taking reasonable steps for the prevention
and detection of fraud and other irregularities. The Directors are
responsible for ensuring that the annual report and accounts, taken
as a whole, are fair, balanced, and understandable and provides the
information necessary for shareholders to assess the group's
performance, business model and strategy.
Website publication
The directors are responsible for ensuring the annual report and
the financial statements are made available on a website. Financial
statements are published on the company's website in accordance
with legislation in the United Kingdom governing the preparation
and dissemination of financial statements, which may vary from
legislation in other jurisdictions. The maintenance and integrity
of the company's website is the responsibility of the directors.
The directors' responsibility also extends to the ongoing integrity
of the financial statements contained therein.
Directors' responsibilities pursuant to DTR4
The directors confirm to the best of their knowledge:
-- The financial statements have been prepared in accordance
with the applicable set of accounting standards, give a true and
fair view of the assets, liabilities, financial position and profit
and loss of the group and company.
-- The annual report includes a fair review of the development
and performance of the business and the financial position of the
Group and Company, together with a description of the principal
risks and uncertainties that they face.
By order of the Board
James McDonald
Company Secretary
9 June 2023
Corporate Governance report
The Board has considered the principles and provisions of the UK
Corporate Governance Code 2018 ("the Code") applicable for this
financial period. The changes made in the revised Code attempt to
improve corporate governance processes and encourage companies to
demonstrate how good governance contributes to the achievement of
long-term success for stakeholders. The Group keep governance
matters under constant review. Despite the changes in the Code
requiring a review of processes, there has not been a requirement
to make fundamental changes to strategy or working practices.
The following statement sets out the Group's application of the
principles of the Code and the extent of compliance with the Code's
provisions, made in accordance with the requirements of the Listing
Rules.
The Board
The Board is responsible for the long-term and sustainable
success of the business, and considers all opportunities and risks
as set out in the principal risks and uncertainties on page 6 .
Further, the Board considers how good governance can assist in
promoting the delivery of the strategy, by reference to strong
stakeholder engagement. Details of how the Board drive this
engagement can be found within the S172 statement on page 7 .
The Directors who held office during the financial year
were:
Executive Directors
Dr John Rigg, Chairman
====================================
Adrian Leer, Managing Director
====================================
James McDonald, Finance Director
====================================
Tim Eckes, Client Services Director
====================================
Independent non-Executive Directors
Alistair Fulton, senior independent non-Executive Director
===========================================================
Chris Duckworth
===========================================================
Charlotte Rigg
===========================================================
On 1 June 2023 the Board was consolidated and strengthened by
the appointment of non-Executive Director Charlotte Rigg to her new
role as Deputy Executive Chairman. On the same date, Alison Lander
was appointed to the Board as non-Executive Director.
Current directorships are as follows:
Dr John Rigg is Chairman. He is a Chartered Accountant. He was a
founder of Marcol Group Plc and was its Managing Director from 1983
until 1988. Marcol was floated on the Unlisted Securities Market in
1987. He was Chairman of Vega Group plc from 1989 until 1996,
holding the post of Chief Executive for much of this period. Vega
floated on the main market in 1992. He was a founder shareholder of
Triad and served as the Chairman of the Company from 1988 up to
just before its flotation in 1996, when he resigned to develop new
business interests overseas. He was appointed as non-Executive
Chairman in June 1999: in May 2004 he became part-time Executive
Chairman.
Adrian Leer is Managing Director. He was appointed to the Board
on 3 March 2015. He initially joined Triad in 2009 in a
consultative capacity, providing advice to the business regarding
its fledgling geospatial product, Zubed, and helping to secure
significant wins with major clients. In 2010, he became General
Manager of Zubed Geospatial. Adrian became Commercial Director of
Triad Consulting & Solutions in 2012.
Tim Eckes is Client Services Director. He was appointed to the
Board on 1 January 2020. Tim Eckes joined Triad in 1991 as a
graduate software engineer before moving into a number of technical
and commercial roles. He has multi-sector experience, having been
involved in engagements across finance, telecoms, travel and
central government. In 5 years preceding his appointment to the
Board, as Managing Consultant he played a significant role in
growing the business, through the development of long lasting and
profitable relationships with key clients.
Alistair Fulton is a non-Executive Director. He is a Chartered
Engineer and member of the British Computer Society. He was the
founding Managing Director of Triad. He continued in this role
until February 1997 when he became non-Executive Chairman, a
position he retained until June 1999, when he took up his present
position. He was a board member of CSSA for 15 years, President in
2000/2001, and has recently served as the Master of the Worshipful
Company of Information Technologists, the 100th Livery Company of
the City of London.
Chris Duckworth was appointed on 1 July 2017 as a non-Executive
Director. He has held numerous positions within public and private
companies as Finance Director, Managing Director, non-Executive
Director and Chairman. He was a founding shareholder and from 1989
to 1994 was Finance Director of Triad where he remained as a
non-Executive Director until 1999. From 1989 to 1994 he was Finance
Director of Vega Group PLC after which he served as a non-Executive
Director until 1997. He was a founding shareholder and Chairman of
Telecity PLC in May 1998 and subsequently acted as a non-Executive
Director until August 2001.
Charlotte Rigg is Deputy Executive Chairman and was appointed to
this position on 1 June 2023. She was appointed to the Board as
non-Executive Director on 1 January 2020. Charlotte Rigg's
experience is both extensive and diverse. Over the last 25 years
she has built an internationally recognised stud farm and runs a
sizeable upland grazing farm in Cumbria where the stud is based. In
addition, Charlotte runs a successful and expanding investment
property portfolio which has been established for over 20
years.
James McDonald is Finance Director and was appointed to the
Board on 16 June 2020. He joined the Company in February 2020 and,
in March 2020, assumed the position of Company Secretary and acting
Finance Director. He is a Chartered Certified Accountant and has
previously held a senior finance position at Foxtons Group plc,
prior to which he was Group Finance Director and Company Secretary
at Brook Street Bureau Plc. He qualified with EY in London.
Alison Lander is a non-Executive Director and was appointed to
this position on 1 June 2023. She is a science graduate with many
years' experience of working with blue-chip organisations within
the IT sector, including Vickers Shipbuilding, Fokker Space and
Triad Group Plc. She has also had a continuous relationship with
the Group, assisting the Chairman and Board for over 20 years.
The Board exercises full and effective control of the Group and
has a formal schedule of matters specifically reserved to it for
decision making, including responsibility for formulating,
reviewing and approving Group strategy, budgets and major items of
capital expenditure.
Regularly the Board will consider and discuss matters that
include, but are not limited to:
-- Strategy;
-- Shareholder value;
-- Financial performance and forecasts;
-- Alignment of culture to Group values;
-- Employee engagement;
-- Human resources; and
-- City and compliance matters.
The Executive Chairman, John Rigg, is responsible for the
leadership and efficient operation of the Board. This entails
ensuring that Board meetings are held in an open manner and allow
sufficient time for agenda points to be discussed. It also entails
the regular appraisal of each Director, providing feedback and
reviewing any training or development needs.
Employee engagement is taken very seriously by the Board, and
the need to engage with the workforce is even more important since
the onset of the pandemic. Bi-weekly Group-wide communication
meetings chaired by the Managing Director take place where there is
a forum available for all staff to participate and contribute
directly with management. Senior management meet daily to discuss
the business and create appropriate communications that
predominantly seek to enhance the well-being of staff, but also
look to align Group values to strategy. Further, on-line platforms
exist that enable constructive discussions concerning operational
delivery and best practice. Given the size of the Group, it is not
appropriate to develop any sub-committees for this purpose and
direct Group forums encourage all staff to participate without
dilution of message.
In a competitive marketplace for talent, the Board ensure
further engagement via regular pay reviews and formal staff
development processes, which enable training and career aspirations
to be discussed along with the facilitation of individual career
paths. The Board are firmly of the view that the culture centred
around the recruitment and retention of quality staff, their
wellbeing, development and future career and remuneration
aspirations will drive the strategic aims of the business and drive
stakeholder value in the long-term.
The Board meets regularly with senior management to discuss
operational matters. The non-Executive Directors must satisfy
themselves on the integrity of financial information and that
financial controls and systems of risk management are robust.
Following presentations by senior management and a disciplined
process of review and challenge by the Board, clear decisions on
the policy or strategy are adopted that preserve Group values and
are sustainable over the long-term. The responsibility for
implementing Board decisions is delegated to management on a
structured basis and monitored at subsequent meetings.
During the period under review, and to date, the Executive
Chairman has not held any business commitments outside the
Group.
Alistair Fulton is the nominated senior independent
non-Executive Director. Charlotte Rigg is Deputy Executive Chairman
and both Chris Duckworth and Alison Lander are non-Executive
Directors. All have long-standing experience as company directors
and are free from any business or other relationship that could
materially interfere with the exercise of their independent
judgement. The Board benefits from their experience and
independence, when they bring their judgement to Board decisions.
The Board considers that all continue to remain independent for the
reasons stated above.
The Group has a procedure for Directors to take independent
professional advice in connection with the affairs of the Group and
the discharge of their duties as Directors.
The Board has an Audit Committee, comprised of the Executive
Chairman John Rigg, and the independent non-Executive Directors,
Alistair Fulton and Chris Duckworth. The Committee is chaired by
Alistair Fulton.
The Board has a Remuneration Committee, comprised of the
Executive Chairman John Rigg, the independent non-Executive
Director Alistair Fulton and Deputy Executive Chairman Charlotte
Rigg. No third-party advisors have a position on the committee or
have provided services to the Committee during the year. The
Committee is chaired by Alistair Fulton.
The following table shows the attendance of Directors at
scheduled meetings of the Board and Audit and Remuneration
Committees during the year ended 31 March 2023 and shows that the
Board are able to allocate sufficient time to the company to
discharge their responsibilities effectively.
Board Audit Remuneration
Committee Committee
========================= ====== =========== =============
Number of meetings held 14 1 2
========================= ====== =========== =============
Number of meetings attended
Executive Directors:
=============================================================
John Rigg (Chairman) 14 1 2
========================= ====== =========== =============
Adrian Leer 14 - -
========================= ====== =========== =============
Tim Eckes 13 - -
========================= ====== =========== =============
James McDonald 14 - -
========================= ====== =========== =============
Non-Executive Directors:
=============================================================
Alistair Fulton 11 1 2
========================= ====== =========== =============
Chris Duckworth 11 1 -
========================= ====== =========== =============
Charlotte Rigg 14 - 2
========================= ====== =========== =============
Audit Committee
The members of the Audit Committee are shown above.
The Board believe that John Rigg, a Chartered Accountant with
broad experience of the IT industry, Alistair Fulton, who has been
a Director of companies in the IT sector for over 30 years and
Chris Duckworth, with many years of experience in senior finance
positions in listed companies, have recent and relevant financial
experience, as required by the Code.
The Audit Committee is responsible for reviewing the Group's
annual and interim financial statements and other announcements. It
is also responsible for reviewing the Group's internal financial
controls and its internal control and risk management systems. It
considers the appointment and fees of the external auditor and
discusses the audit scope and findings arising from audits. The
Committee is also responsible for assessing the Group's need for an
internal audit function.
Consideration of significant issues in relation to the financial
statements
The Audit Committee have considered the following significant
issues in relation to the preparation of these financial
statements;
Revenue recognition: The Committee has considered revenue
recognised in projects during, and active at the end of the
financial year to ensure revenue has been recognised correctly.
Furthermore, the Committee has also assessed whether the Group is
acting as agent or principle in a transaction.
IFRS 16 'Leases': The Committee have considered the accounting
treatment with respect to the critical accounting estimates.
Dilapidations provisions: The Committee have considered the
accounting treatment with respect to the critical accounting
estimates.
Going concern: The Committee has reviewed budgets, deferred tax
calculations and cash flow projections against borrowing facilities
available to the Group, to ensure the going concern basis of
preparation of the results remains appropriate.
Meetings with auditor and senior finance team
Members of the Audit Committee met with the senior finance team
in advance of their meeting with the auditor, prior to commencement
of the year-end audit to discuss;
-- Audit scope, strategy and objectives
-- Key audit and accounting matters
-- Independence and audit fee
A meeting was held prior to the completion of the audit with the
senior finance team and the auditor to assess the effectiveness of
the audit and discuss audit findings.
Effectiveness of external audit process
The Committee conducts an annual review of the effectiveness of
the annual report process. Inputs into the review include feedback
from the finance team, planning and scope of the audit process and
identification of risk, the execution of the audit, communication
by the auditor with the Committee, how the audit adds value and a
review of auditor independence and objectivity. Feedback is
provided to the external auditor and management by the Committee,
with any actions reviewed by the Committee.
Auditor independence and objectivity
The Committee has procedures in place to ensure that
independence and objectivity is not impaired. These include
restrictions on the types of services which the external auditor
can provide, in line with the FRC Ethical Standards on Auditing.
The external auditor has safeguards in place to ensure that
objectivity and independence is maintained and the Committee
regularly reviews independence taking into consideration relevant
UK professional and regulatory requirements. The external auditor
is required to rotate the audit partner responsible for the Group
audit every five years.
Non-audit fees
During the year the Group did not engage its auditor for any
non-audit work.
The Committee is responsible for reviewing any non-audit work to
ensure it is permissible under EU audit regulations and that fees
charged are justified, thus ensuring auditor independence is
preserved.
Appointment of external auditor
BDO LLP was reappointed external auditor in 2017 following a
tendering process.
BDO LLP has confirmed to the Committee that they remain
independent and have maintained internal safeguards to ensure that
the objectivity of the engagement partner and audit staff is not
impaired.
Mandatory rotation of the auditor is required for the year
ending 31 March 2025 and the Board are preparing to apply the
appropriate tendering and selection process to appoint a new
auditor.
Internal audit
The Audit Committee has considered the need for a separate
internal audit function this year but does not consider it
appropriate in view of the size of the Group. The Group is
certified to ISO 9001:2015 and ISO 27001:2013.
Internal controls and risk management
The Board has applied the internal control and risk management
provisions of the Code by establishing a continuous process for
identifying, evaluating and managing the significant and emerging
risks faced by the Group. The Board regularly reviews the process,
which has been in place from the start of the year to the date of
approval of this report and which is in accordance with FRC
guidance on risk management, internal control and related financial
and business reporting. The Board is responsible for the Group's
system of internal control and for reviewing its effectiveness.
Such a system is designed to manage rather than eliminate risk of
failure to achieve business objectives and can only provide
reasonable and not absolute assurance against misstatement or
loss.
In compliance with the Code, the Audit Committee regularly
reviews the effectiveness of the Group's systems of internal
financial control and risk management. The Board's monitoring
covers all controls, including financial, operational and
compliance controls and risk management. It is based principally on
reviewing reports from management to consider whether significant
weaknesses and risks are effectively managed and, if applicable,
considering the need for more extensive monitoring.
The Board has also performed a specific assessment for the
purpose of this annual report. This assessment considers all
significant aspects of internal control and risk management arising
during the period covered by the report.
The key elements of the internal control and risk management
systems are described below:
-- Clearly documented procedures contained in a series of
manuals covering Group operations and management, which are subject
to internal project audit and external audit as well as regular
Board review.
-- The Group's controls include appropriate segregation of
duties which are embedded in the organisation
-- The Group has a formal process for planning, reporting and
reviewing financial performance against strategy, budgets,
forecasts and on a monthly, bi-annual and annual basis.
-- An appropriate budgeting process where the business prepares
budgets for the coming year, which are approved by the Board.
-- Close involvement in the day-to-day management of the business by the Executive Directors.
-- Regular meetings between the Executive Chairman, Executive
Directors and senior managers to discuss and monitor potential
risks to the business, and to implement mitigation plans to address
them.
Remuneration Committee
The Remuneration Committee is responsible for setting
remuneration for Executive Directors and the Chairman in accordance
with the remuneration policy below. In addition, the Committee is
responsible for recommending and monitoring the level and structure
of remuneration for senior management.
The Group's Remuneration Committee is authorised to take
appropriate counsel to enable it to discharge its duty to make
recommendations to the Board in respect of all aspects of the
remuneration package of Directors. The Committee also takes into
account the general workforce remuneration awards when setting
Director remuneration.
The Directors' remuneration report can be found on page 29 .
Whistleblowing
Staff may contact the senior independent non-Executive Director,
in confidence, to raise genuine concerns of possible improprieties
in financial reporting, or employee related matters.
Board evaluation
Board members are made fully aware of their duties and
responsibilities as Directors of listed companies and are supported
in understanding and applying these by established and more
experienced Directors. The Executive Chairman continuously
evaluates the ability of the Board to perform its duties and
recognises the strengths and addresses any weaknesses of the Board.
In addition, training is available for any Director at the Group's
expense should the Board consider it appropriate in the interests
of the Group.
Relations with shareholders
Substantial time and effort is spent by Board members on
meetings with and presentations to existing and prospective
investors. The views of shareholders derived from such meetings are
disseminated by the Chairman to other Board members.
Private shareholders are invited to attend and participate at
the Annual General Meeting.
Terms of reference
The terms of reference of the Audit and Remuneration Committees
are available on request from the Company Secretary.
Statement of compliance
The Board considers that it has been compliant with the
provisions of the Code for the whole of the period, except as
detailed below:
Provision 9 The roles of chairman and chief executive should not be exercised by the same individual
. John Rigg is the Executive Chairman. Adrian Leer is Managing Director. The Board currently
has no plans to recruit a Chief Executive Officer as it considers that the duties are being
satisfactorily covered by members of the Executive Board and the Group's senior management.
Provisions 17/23 There should be a nominations committee which should lead the process for board appointments
and make recommendations to the board. The Board considers that because of its size, the whole
Board should be involved in Board appointments.
Provision 18 All directors should be subject to annual re-election. The Board consider that because of
its size, re-election by rotation in accordance with the Company's Articles of Association
at the Annual General Meeting is sufficient.
Provision 19 The chair should not remain in post beyond nine years from the date of their first appointment
to the board. The Board considers that because of its size and critically, due to the experience
of the Executive Chairman, this would not be appropriate. The Board believe that re-election
in accordance with the Company's Articles of Association is sufficient.
Provisions 21/23 The board should undertake a formal and rigorous annual evaluation of its own performance
and that of its committees and individual Directors . There is a process of continuous informal
evaluation, due to the small size of the Board.
Provision 20 Open advertising and/or an external search consultancy should generally be used for the
appointment
of the chair and non-executive directors. The Board has a strong culture of promoting from
within with relevant experience to the Group.
Provision 24 The chair of the board should not be a member of the audit committee. The Board considers
that because of its size, and the relevant knowledge and experience of the Executive Chairman,
that this is not appropriate.
DTR 7.2.8 ARR The requirement to detail performance against a diversity policy . The Group has a diversity
policy which meets our legal requirements. The monitoring of performance against this policy
is an area which the Board take very seriously and continuously look to improve. The size
of the Group and the long tenure of senior staff provide constraints to improving ratios in
the short-term.
By order of the Board
James McDonald
Company Secretary
9 June 2023
Directors' remuneration report
On the following pages we set out the remuneration report for
the year ended 31 March 2023. The members of the Remuneration
Committee are shown in the Corporate Governance report on page 22
.
This report has been prepared in accordance with the Companies
Act 2006 and is split into two sections as follows;
1. The Directors' remuneration policy.
2. The Annual report on remuneration. This will be subject to an
advisory shareholder vote at this year's Annual General
Meeting.
During the year the Committee carefully reviewed Directors'
remuneration. Given the continued positive trajectory under strong
strategic and operational guidance, the Committee awarded salary
increases to the Board that would be effective in the next
financial year.
Directors' remuneration policy
The remuneration policy sets out the framework within which the
Company remunerates its Directors. The Company's remuneration
report was put to a shareholder vote at the 2022 Annual General
Meeting of the Company and was approved by 99.97% of shareholders
with no votes withheld. See page 17 of the Directors' report for
further details of voting rights.
The Committee welcomed the unanimous approval of the
shareholders, which represented 43% of the total shareholding. The
Committee aims to align meaningful remuneration with Group
financial performance by taking into account the difficult trading
environment, and to ensure the long-term health of the business.
The performance of the Directors has been deemed by the Committee
to be more than satisfactory, with progression on key strategic
objectives and a return to profitability.
The Committee therefore concludes that the remuneration is fair
and appropriate but will continue to seek shareholder feedback.
The remuneration policy will be put to a shareholder vote every
three years unless any changes to the policy are proposed before
then.
The Committee intends to implement the Directors' remuneration
for the following year as agreed at the 2023 General Meeting.
Policy table - Executive Directors
Element & purpose Operation Maximum payable Performance metrics
============================ ============================ ============================ ============================
Base salary Reviewed annually taking Ordinarily, salary None, although individual
into consideration market increases will be in line performance is considered
Reflects the individual's data, business performance, with average increases when setting salary levels.
skills, responsibilities external economic awarded to other employees
and experience. factors, the complexity of in the Company.
the business and the role, In certain circumstances,
Supports the recruitment cost, and the incumbent's such as a change in
and retention of Executive experience responsibility or
Directors. and performance as well as development in role
the wider employee pay increases
review. beyond this may be made
subject to the factors
mentioned in the Operation
column
============================ ============================ ============================ ============================
Benefits in kind Benefits in kind include Benefits are set at a level None.
company cars or allowances, considered to be
Protects the well-being of private medical insurance, appropriate taking into
Directors and provides fair life cover account individual
and reasonable market and permanent health circumstances.
competitive benefits. insurance. Benefits are
reviewed periodically.
The Remuneration Committee
retains discretion to
provide other benefits
depending on the
circumstances
which may include but are
not limited to relocation
costs or allowances to
facilitate recruitment.
============================ ============================ ============================ ============================
Pension The Company pays The Company matches None.
contributions into a individual contributions up
Provides competitive personal pension scheme or to a maximum of 5%.
post-retirement benefits to cash alternative.
support the recruitment and This limit is in line with
retention of the limits available for
Executive Directors. all employees.
============================ ============================ ============================ ============================
All employee share scheme Executive Directors shall The limits will be in line Any conditions shall be in
be eligible to participate with the HMRC limits for line with HMRC guidance for
To provide employees with in any future all employee the relevant schemes. such schemes and there may
the opportunity to own share schemes be no performance
shares in the Company. (e.g. Save-as-you-earn or conditions if appropriate.
Share Incentive Plan) if
adopted by the Company.
============================ ============================ ============================ ============================
Share option scheme The Company operates an EMI The potential value of Specific performance
share option scheme. options held rises as the criteria are specified at
Encourages share ownership Discretionary awards are Company's share price the time of awarding the
amongst employees and made in accordance increases. share options to ensure
aligns their interests with with the scheme rules. alignment with the
the shareholders. interests of shareholders.
============================ ============================ ============================ ============================
Employee Share Incentive The Remuneration Committee The maximum award that may Awards may have performance
Plan may make share awards be granted shall be 200% of conditions attached.
annually under the Plan. salary.
Incentivises long-term The Remuneration Committee
value creation, aligning The Plan will give the has discretion to determine
the interests of Executives Remuneration Committee appropriate measures,
and shareholders flexibility to make awards targets and ranges
through share awards. in the form of conditional in respect of each award
awards (performance share when made.
award).
The Remuneration Committee
Performance share awards may also adjust the
shall have a performance formulaic outcome of awards
period of at least 3 years. where it deems
that it is not reflective
Awards shall not vest in of overall business
full any earlier than 3 performance.
years, but the Remuneration
Committee retains
discretion to vest in
tranches. Awards made to
Executive Directors will
have an additional
post-vesting holding period
of 2 years during which
shares cannot be sold other
than to settle
tax liabilities which may
arise.
Malus and clawback
provisions apply.
The award of shares under the Plan or EMI scheme is at the sole
discretion of the Remuneration Committee: there is no contractual
entitlement for any Director to receive an award annually or
otherwise. The Group does not believe that a performance related
annual cash bonus is appropriate at the present time and that
solely equity-based incentives are a more appropriate mechanism for
incentivising, rewarding and retaining Executive Directors.
Shareholding Guidelines
The Remuneration Committee is introducing shareholding
guidelines in order to encourage a build-up of shares over time for
the Executive Directors.
Whilst there is no formal requirement beyond the 2 year
post-vesting holding period, the Remuneration Committee expects
that a substantial portion of shares earned from incentive
arrangements will continue to be held by the Executive Directors in
the longer term.
Policy table - non-Executive Directors
Element Relevance to short and Operation Maximum payable Performance metrics
long-term strategic objectives
======== ================================ =================== =============================== ====================
Fees Competitive fees to attract Reviewed annually. In general, the level of fee Not applicable.
experienced Directors. increase for the non-Executive
Directors will be set taking
account
of any change in
responsibility.
The remuneration of the non-Executive Directors is agreed by the
Board. However, no Director is involved in deciding their own
remuneration.
Malus and Clawback provisions
The Plan contains malus and clawback provisions which may
trigger in exceptional circumstances and which include:
-- material misstatement of company accounts;
-- fraud, gross misconduct or misbehaviour;
-- materially mistaken, misrepresented or incorrect information
has been used to assess the value of an award;
-- an error in assessing or setting performance conditions;
-- material reputational damage or
-- a downturn in financial performance or corporate failure for
which the relevant individual is responsible or has significantly
contributed to.
Malus may apply until settlement, and clawback may apply after
vesting for up to 2 years, and these provisions allow the
Remuneration Committee to recover value delivered in connection
with awards and amend or reduce awards in the above circumstances
(potentially to nil).
Discretion
The Remuneration Committee has discretion in several areas of
the remuneration policy as set out in this report. The Remuneration
Committee may also exercise operational and administrative
discretions under relevant plan rules approved by shareholders as
set out in those rules. In addition, the Remuneration Committee has
the discretion to amend the remuneration policy in respect of minor
or administrative matters where it would be, in the opinion of the
Remuneration Committee, disproportionate to seek or await
shareholder approval.
As noted, the Remuneration Committee reviews all incentive
outturns to assess whether they align to the overall performance of
the business and the experience of its key stakeholders over the
period e.g., shareholders and employees. The Remuneration Committee
retains discretion to adjust the formulaic outcome of incentives
upwards or downwards to reflect its judgement. Any such exercise of
discretion will be disclosed in the relevant annual report.
Pre-existing remuneration arrangements and minor changes
The Remuneration Committee may make remuneration payments
outside of the terms of this remuneration policy where the terms of
the payment were agreed prior to the introduction of this or prior
remuneration policies, provided the terms were in line with the
remuneration policy in place at that time, or where the terms were
agreed prior to the relevant Director being a member of the Board.
Any such payments may be satisfied in line with the terms
agreed.
Approach to recruitment remuneration
The Group's remuneration policy is to provide remuneration
packages which secure and retain management of the highest quality.
Therefore, when determining the remuneration packages of new
Executive Directors, the Remuneration Committee will structure a
package in accordance with the general policy for Executive
Directors as shown above. In doing so the Remuneration Committee
will consider a number of factors including:
-- the salaries and benefits available to Executive Directors of comparable companies;
-- the need to ensure Executive Directors' commitment to the continued success of the Group;
-- the experience of each Executive Director; and
-- the nature and complexity of the work of each Executive Director.
The Remuneration Committee may determine that an initial salary
positioning below market is appropriate and in those circumstances,
may in the years following appointment award increases greater than
levels awarded to the wider workforce in the short-term.
Incentive levels will be in line with the limits for Executive
Directors and the structure will be as permissible under the
policy.
If applicable, relocation allowances may be made in line with
the policy.
The Company may offer to buy out incentives which have been
forfeited from a previous employer. Where such awards are made,
they will seek to match the value and time horizons of foregone
awards and will reflect any performance conditions attached.
The Company will not make any sign-on bonuses or "golden hello"
payments when appointing Executive Directors
Directors' service contracts and policy
The details of the Directors' contracts are summarised as
follows:
Date of contract Notice period
============== ================= ==============
J C Rigg 01/07/1999 1 month
============== ================= ==============
A M Fulton 19/02/1997 1 month
============== ================= ==============
A Leer 03/03/2015 6 months
============== ================= ==============
C J Duckworth 01/07/2017 1 month
============== ================= ==============
T J Eckes 01/01/2020 6 months
============== ================= ==============
C M Rigg 01/01/2020 1 month
============== ================= ==============
J McDonald 16/06/2020 6 months
============== ================= ==============
A J Lander 01/06/2023 1 month
All contracts are for an indefinite period. No contract has any
provision for the payment of compensation upon the termination of
that contract.
Illustrations of application of remuneration policy
As there are currently no performance related or variable
elements of Executive Director remuneration it is not appropriate
to prepare illustrations required under the legislation.
Policy on payment for loss of office
The primary principle underpinning the determination of any
payments on loss of office is that payments for failure will not be
made. Contracts and incentive plan rules have been drafted in such
a way that the Remuneration Committee has the necessary powers to
ensure this.
It is the Group's policy in relation to Directors' contracts
that:
-- Executive Directors should have contracts with an indefinite
term providing for a maximum of six months' notice by either
party.
-- non-Executive Directors should have terms of engagement for
an indefinite term providing for one month notice by either
party.
-- there is no provision for termination payments to Directors.
In relation to the Plan, awards will normally lapse for a leaver
and the plan rules contain Good Leaver provisions that shall
determine the treatment of awards in the following cases:
-- death,
-- ill-health, injury, disability
-- the employing company / business / part of the business being
transferred outside of the Group or
-- any other reason at the discretion of the Remuneration Committee
In such cases:
-- Awards will ordinarily be pro-rated based on time served over the vesting period.
-- Vesting will normally occur at the normal time except upon
death where vesting may be accelerated.
-- Performance conditions shall still apply.
The Remuneration Committee reserves discretion however to
determine the exact treatment of awards having due regard to the
circumstances at the relevant time.
Consideration of employment conditions elsewhere in the
Group
In setting the Executive Directors' remuneration, the Committee
takes into account the pay and employment conditions applicable
across the Group in the reported period. No consultation has been
held with employees in respect of Executive Directors'
remuneration.
Consideration of shareholders' views
The Remuneration Committee considers the views of institutional
investors and published guidelines of its shareholders when making
remuneration decisions. Furthermore, the Remuneration Committee is
open to conversations with shareholders on the design of the policy
and any remuneration decisions made concerning Executive
Directors.
Annual report on remuneration (audited)
Directors' remuneration - single total figure of
remuneration
The remuneration of each of the Directors for the period they
served as a Director are set out below:
2023
=====================================================================================================================
Director Basic salary Benefits Pension Total Fixed Pay One-time Total Variable Pay Total
and fees in kind Discretionary
payment
=============== ============= ========= ======== ================ =============== =================== ========
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
=============== ============= ========= ======== ================ =============== =================== ========
Executive
=============== ============= ========= ======== ================ =============== =================== ========
J C Rigg 60 - - 60 - - 60
A Leer 180 19 33 232 - - 232
T J Eckes 145 2 25 172 - - 172
J McDonald 153 - 16 169 - - 169
=============== ============= ========= ======== ================ =============== =================== ========
Non-Executive
=============== ============= ========= ======== ================ =============== =================== ========
A M Fulton 40 - - 40 - - 40
C J Duckworth 35 - - 35 - - 35
C Rigg 35 - - 35 - - 35
Total 648 21 74 743 - - 743
=============== ============= ========= ======== ================ =============== =================== ========
2022
======================================================================================================================
Director Basic salary Benefits Pension Total Fixed Pay One-time Total Variable Pay Total
and fees in kind Discretionary
payment
================ ============= ========= ======== ================ =============== =================== ========
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
================ ============= ========= ======== ================ =============== =================== ========
Executive
================ ============= ========= ======== ================ =============== =================== ========
J C Rigg 60 - - 60 - - 60
A Leer (1) 163 18 30 211 161 161 372
T J Eckes (2) 133 2 21 156 64 64 220
J McDonald (3) 139 - 14 153 64 64 217
Non-Executive
================ ============= ========= ======== ================ =============== =================== ========
A M Fulton 40 - - 40 - - 40
C J Duckworth 35 - - 35 - - 35
C Rigg 35 - - 35 - - 35
Total 605 20 65 690 289 289 979
================ ============= ========= ======== ================ =============== =================== ========
(1) Adrian Leer's basic salary was increased from GBP175,000 to
GBP200,000 p.a. with effect from 1 January 2022
(2) Tim Eckes' basic salary was increased to GBP150,000 p.a.
with effect from 1 January 2022.
(3) James McDonald's basic salary was increased to GBP150,000
p.a. with effect from 1 January 2022.
Other Remuneration
In November 2021, the Executive Directors were awarded a
one-time discretionary payment for their commitment and
contribution during a very challenging year as follows: Adrian Leer
GBP160,500, Tim Eckes GBP64,200 and James McDonald GBP64,200. Other
than vesting conditions in relation to outstanding share award
schemes (see note 20), no performance measures or targets were in
place for either the year ended 31 March 2023 or any prior
financial year, upon which any variable pay elements could become
payable during the year.
Benefits in kind include the provision of company car and
medical insurance.
Pension includes a 5% employer contribution together with
contributions made under an employee salary sacrifice scheme.
Three Directors are members of a money purchase pension scheme
into which the Group contributed during the year.
Payments to past Directors
There were no payments to past Directors during the year.
Payment for loss of office
There were no payments for loss of office during the year.
Directors' interests in shares
The Directors who held office at the end of the financial year
had the following beneficial interests in the ordinary shares of
the Company.
1 April 2022 31 March 2023
=============== ============= ==============
A M Fulton 337,040 337,040
J C Rigg 4,594,400 4,794,400
A Leer 305,379 305,379
C J Duckworth 22,026 22,026
T J Eckes 120,374 120,374
C M Rigg 112,000 312,000
J McDonald 27,600 27,600
=============== ============= ==============
Total 5,518,819 5,918,819
=============== ============= ==============
Since the year end, A M Fulton's shareholding increased to
497,780 ordinary shares. A J Lander (appointed to the Board on 1
June 2023) holds 134,545 ordinary shares.
Directors' share options
EMI scheme
The interests of Executive Directors in the EMI share option
scheme were as follows:
At 1 April 2021 Exercised At 31 At 31 March Exercise price Exercise
during March 2022 2023 period
year
================ ================ ================ ============ ================ =============== ===============
A Leer:
======================================================================================================================
granted 09.03.21 to
09.03.18 150,000 (150,000) - - 53.5p 09.03.28
================ ================ ================ ============ ================ =============== ===============
T J Eckes:
======================================================================================================================
granted 09.03.21 to
09.03.18 60,000 (60,000) - - 53.5p 09.03.28
================ ================ ================ ============ ================ =============== ===============
210,000 (210,000) - -
No EMI options were available to the Directors during the year
ended 31 March 2023 (2022: 210,000) As the performance conditions
were met all 210,000 above were exercisable on 1 April 2021 and
were subject to relevant close period.
Share options are exercisable provided that the relevant
performance requirement has been satisfied.
For options granted on 9 March 2018: The vesting date was set at
31 March 2021 and the exercise period ends on 9 March 2028, and
100% of the shares granted under an Option will vest if the
Company's share price at 31 March 2021 has increased by 30% or more
from the share price as at the date of grant. 50% of shares granted
under an Option will vest if the Company's share price at 31 March
2021 has increased by 15% from the share price as at the date of
grant. Between these upper and lower thresholds, awards vest on a
straight-line basis.
The total share-based payment expense recognised in the year in
respect of Directors' EMI share options is nil (2022: nil).
The total cash remitted to the Company by the Directors to
exercise share options during the year was nil (2022: GBP112k)
Restricted Stock Units
On 30 March 2022 the Committee awarded the Executive Directors
the following restricted stock units (RSUs):
Director Date award made Number Performance condition Vesting date
================ ================= ======= ====================== ==============
Adrian Leer 30 March 2022 60,000 135.0p 30 March 2025
================ ================= ======= ====================== ==============
Tim Eckes 30 March 2022 60,000 135.0p 30 March 2025
================ ================= ======= ====================== ==============
James McDonald 30 March 2022 60,000 135.0p 30 March 2025
The Award will Vest if the Board determines that the Market
Value of a Share on the third anniversary of the Award Date is
equal to or greater than the Market Value of a Share on the Award
Date. The market value at the Award Date is 135p.
The total share-based payment expense recognised in the year in
respect of Directors' RSU share options is GBP53,447 (2022:
GBP114).
Malus, clawback and hold over periods are as per the Plan.
The market price of the Company's shares was 137.5p at 31 March
2023 and the range during the year was between 81p and 145p.
Further details relating to share awards can be found in note
20.
Annual report on remuneration (unaudited)
Performance graph
The following graph shows the Group's performance, measured by
total shareholder return, compared with the performance of the FTSE
Fledgling Index ("FTSEFI") also measured by total shareholder
return ("TSR"). The FTSEFI has been selected for this comparison
because it is an index of companies with similar current market
capitalisation to Triad Group Plc.
http://www.rns-pdf.londonstockexchange.com/rns/2936C_1-2023-6-9.pdf
Chief Executive remuneration
For the financial year ended 31 March 2023 the salary of the
Executive Chairman was GBP60,000 (2022: GBP60,000). Employee
salaries increased, on average, by 6.5% in the year (2022:
3.8%).
The remuneration paid to the Executive Chairman for the
financial years 2014 to 2023 were as follows:
2014 2015 2016 2017 2018 2019 2020 2021 2022 2023
========== ========== ========== ========== ========== ========== ========== ========== ========== ==========
GBP25,000 GBP25,000 GBP25,000 GBP25,000 GBP60,000 GBP60,000 GBP60,000 GBP60,000 GBP60,000 GBP60,000
The annual amounts paid above relate to salary only. The
Executive Chairman did not receive any discretionary payments
during these periods.
Relative importance of spend on pay
The total dividends or other cash distributions to shareholders
during the year was GBP995k (2022: GBP653k), see note 9. The total
employee remuneration (including Directors) during the year was
GBP10.028m (2022: GBP8.620m).
Percentage change in Directors' remuneration
The tables below show the change in Directors' remuneration
compared to the employees of the company, where Directors and
employees have been employed by Triad for the full relevant
financial years (2021: 41 employees, 2022: 43 employees, 2023: 57
employees).
Basic salary and fees 2021 2022 2023
==================================================================== =========== ============= ===========
J C Rigg 0% 0% 0%
==================================================================== =========== ============= ===========
A Leer 0% 3.6% 10.3%
==================================================================== =========== ============= ===========
T J Eckes n/a 0.1% 10.3%
==================================================================== =========== ============= ===========
J McDonald n/a 9.4% 10.6%
==================================================================== =========== ============= ===========
A M Fulton 0% 0% 0%
==================================================================== =========== ============= ===========
C J Duckworth 0% 0% 0%
==================================================================== =========== ============= ===========
C Rigg n/a 0% 0%
==================================================================== =========== ============= ===========
Employees of the company 3.7% 3.8% 6.5%
==================================================================== =========== ============= ===========
Benefits in kind (1) 2021 2022 2023
==================================================================== =========== ============= ===========
J C Rigg n/a n/a n/a
==================================================================== =========== ============= ===========
A Leer (1.7%) 19.9% (2) 2.3%
==================================================================== =========== ============= ===========
T J Eckes n/a (23.4%) 4.6%
==================================================================== =========== ============= ===========
J McDonald n/a n/a n/a
==================================================================== =========== ============= ===========
A M Fulton n/a n/a n/a
==================================================================== =========== ============= ===========
C J Duckworth n/a n/a n/a
==================================================================== =========== ============= ===========
C Rigg n/a n/a n/a
==================================================================== =========== ============= ===========
Employees of the company (5.7%) (18.3%) (7.1%)
==================================================================== =========== ============= ===========
(1) The negative values in this table represent a reduction in costs for the provision of
identical benefits
(2) Represents the increase in provision of company car
Other (includes commission and bonus payments) 2021 2022 2023
==================================================================== =========== ============= ===========
J C Rigg n/a n/a n/a
==================================================================== =========== ============= ===========
A Leer n/a 100% (100%)
==================================================================== =========== ============= ===========
T J Eckes n/a 100% (100%)
==================================================================== =========== ============= ===========
J McDonald n/a 100% (100%)
==================================================================== =========== ============= ===========
A M Fulton (100%) (3) n/a n/a
==================================================================== =========== ============= ===========
C J Duckworth n/a n/a n/a
==================================================================== =========== ============= ===========
C Rigg n/a n/a n/a
==================================================================== =========== ============= ===========
Employees of the company (9.5%) (44.3%) (88.2%)
==================================================================== =========== ============= ===========
(3) Represents back pay paid in 2020
Represents cessation of a commission scheme for a small number of employees
The Group is exempt from disclosing data with respect to the CEO
pay ratio due to employee numbers being less than 250.
Consideration of matters related to Directors' remuneration
During the financial year, the Remuneration Committee met twice
to discuss Directors' remuneration. No external advice was sought
in relation to matters discussed at this meeting.
Alistair Fulton
Chairman, Remuneration Committee
9 June 2023
Independent auditor's report to the members of Triad Group
Plc
Opinion on the financial statements
In our opinion the financial statements:
-- give a true and fair view of the state of the Group's and of
the Parent Company's affairs as at 31 March 2023 and of the Group's
and Parent Company's profit for the year then ended;
-- have been properly prepared in accordance with UK adopted
international accounting standards; and
-- have been prepared in accordance with the requirements of the Companies Act 2006.
We have audited the financial statements of Triad Group Plc (the
'Parent Company') and its subsidiaries (the 'Group') for the year
ended 31 March 2023 which comprise the Group and Company Statements
of comprehensive income and expense, Group and Company Statements
of changes in equity, Group and Company Statements of financial
position, Group and Company Statements of cash flows and notes to
the financial statements, including a summary of significant
accounting policies. The financial reporting framework that has
been applied in their preparation is applicable law and UK adopted
international accounting standards.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (ISAs
(UK)) and applicable law. Our responsibilities under those
standards are further described in the
Auditor's responsibilities for the audit of the financial
statements section of our report. We believe that the audit
evidence we have obtained is sufficient and appropriate to provide
a basis for our opinion. Our audit opinion is consistent with the
additional report to the audit committee.
Independence
Following the recommendation of the audit committee, we were
appointed by the Directors to audit the financial statements for
the year ended 31 March 2006 and subsequent financial periods. The
period of total uninterrupted engagement including retenders and
reappointments is 18 years, covering the years ended 31 March 2006
to 31 March 2023. We remain independent of the Group and the Parent
Company in accordance with the ethical requirements that are
relevant to our audit of the financial statements in the UK,
including the FRC's Ethical Standard as applied to listed public
interest entities, and we have fulfilled our other ethical
responsibilities in accordance with these requirements. The
non-audit services prohibited by that standard were not provided to
the Group or the Parent Company.
Conclusions relating to going concern
In auditing the financial statements, we have concluded that the
Directors' use of the going concern basis of accounting in the
preparation of the financial statements is appropriate. Our
evaluation of the Directors' assessment of the Group and the Parent
Company's ability to continue to adopt the going concern basis of
accounting included:
-- We considered the nature of the Group, its business model and
related risks to going concern arising.
-- We evaluated the Directors' assessment of the Group's ability
to continue as a going concern, including challenging the
underlying data in the forecasts by comparing it to actual
performance in the current financial year, client contracts and
comparing it to post year-end financial performance.
-- We challenged the rationale for the key assumptions, using
our knowledge of the business and the sector, corroborating to
supporting documentation where appropriate.
-- We examined the forecasts and stress tests provided by the
Group and the appropriateness of the assumptions made.
-- We tested the integrity of the models by checking the
formulae, the arithmetic accuracy and any hard coding.
-- Enquires were made of management as to any future events or
conditions that may affect the Group's ability to continue as a
going concern, we have also inspected the minutes of Board meetings
to support our enquiries.
-- We obtained confirmation of the financing facilities
available to the Group and assessed the availability of cash to the
Group over the forecast period and the level of headroom
available.
-- Reviewing post-balance sheet results, specifically the cash
flow position against that budgeted; and
-- Considering the adequacy of the disclosures in the financial
statements against our knowledge of the Group, the Directors' going
concern assessment and the requirements of the accounting
standards.
Based on the work we have performed, we have not identified any
material uncertainties relating to events or conditions that,
individually or collectively, may cast significant doubt on the
Group and the Parent Company's ability to continue as a going
concern for a period of at least twelve months from when the
financial statements are authorised for issue.
In relation to the Parent Company's reporting on how it has
applied the UK Corporate Governance Code, we have nothing material
to add or draw attention to in relation to the Directors' statement
in the financial statements about whether the Directors considered
it appropriate to adopt the going concern basis of accounting.
Our responsibilities and the responsibilities of the Directors
with respect to going concern are described in the relevant
sections of this report.
Overview
Coverage 100% (2022: 100%) of the Group profit before tax
------------------ ----------------------------------------------------------------
Key audit matters 2023 2022
------------------
Revenue recognition X X
------------------
Materiality Group financial statements as a whole
GBP74k (2022: GBP85k) based on 0.5% (2022: 0.5%) of revenue
An overview of the scope of our audit
Our Group audit was scoped by obtaining an understanding of the
Group and its environment, including the Group's system of internal
control, and assessing the risks of material misstatement in the
financial statements. We also addressed the risk of management
override of internal controls, including assessing whether there
was evidence of bias by the Directors that may have represented a
risk of material misstatement.
The Group operates solely in the United Kingdom. The Group
consists of six companies, five which are dormant, with the Parent
Company being the only trading entity and significant component.
The Group engagement team performed a full scope audit of the
Parent Company.
Climate change
Our work on the assessment of potential impacts on
climate-related risks on the Group's operations and financial
statements included:
-- Enquiries and challenge of management to understand the actions they have taken to identify climate-related risks and their potential impacts on the financial statements and adequately disclose climate-related risks within the annual report;
-- Our own qualitative risk assessment taking into consideration
the sector in which the Group operates and how climate change
affects this particular sector;
-- Review of the minutes of Board and Audit Committee meeting
and other papers related to climate change and performed a risk
assessment as to how the impact of the Group's commitment as set
out in Corporate social responsibility may affect the financial
statements and our audit;
-- We challenged the extent to which climate-related
considerations, including the expected cash flows from the
initiatives and commitments have been reflected, where appropriate,
in the Directors' going concern assessment and viability
assessment; and
-- We also assessed the consistency of managements disclosures
included as 'Other Information' on page 12 with the financial
statements and with our knowledge obtained from the audit.
Based on our risk assessment procedures, we did not identify
there to be any Key Audit Matters materially impacted by
climate-related risks.
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) that we identified, including those which had the greatest
effect on: the overall audit strategy, the allocation of resources
in the audit, and directing the efforts of the engagement team.
These matters were addressed in the context of our audit of the
financial statements as a whole, and in forming our opinion
thereon, and we do not provide a separate opinion on these
matters.
Key audit matter How the scope of our audit
addressed key audit matter
--------------------------------------------------------------------------------------- -----------------------------
Revenue We considered there to be a significant risk of We performed testing on a
recognition material misstatement due to fraud relating sample basis over the
to the existence of revenue around year end (cut-off) revenue postings pre and
As detailed in and overstatement of revenue. We considered post year end, agreeing
note 1 and 4 to that this fraud risk could arise through: the posting to supporting
the financial documentation, checking that
statements. * fictitious contractor/candidates; the transaction has been
recorded in
the correct period and
* manipulation of cut-off through revenue not being revenue has been recognised
recognised appropriately in line with their appropriately.
respective performance obligations;
We performed testing on a
sample basis over the
* manipulation of revenue through journal entries; contractor costs incurred
before and after
the year end, agreeing these
* inappropriate recognition of accrued income; and to supporting documentation
and checking that the
revenue associated
* manipulation of contractor accrual. with these has been recorded
in the correct period.
We tested a sample of credit
In view of the significance of revenue recognition to notes recognised post year
the financial statements and the potential end to supporting
for fraud this was considered to be key audit matter. documentation to
confirm recognition in the
correct period.
We performed testing on a
sample basis over the
timecards received either
side of the year
end, agreeing them to sales
invoices to check that these
have been recorded in the
correct
period.
We performed testing on a
sample basis over the
revenue postings throughout
the year, agreeing
the postings to payment,
timecard, confirmation of
charge out rate and sales
invoice as appropriate,
checking that the
transactions exist and are
recorded in line with the
accounting policy and
in the correct accounting
period.
We tested a sample of
journal postings to revenue,
agreeing the posting to
supporting documentation
to assess the validity
thereof.
We tested a sample of year
end accrued and deferred
income balances and agreed
them to sales
invoices, bank payment where
appropriate and timecards.
We agreed a sample of new
customers and contractors
during the period to
supporting documentation
to confirm existence.
Key observations:
Based on the procedures
performed we did not
identify any matters to
indicate that revenue
recognition was
inappropriate.
Our application of materiality
We apply the concept of materiality both in planning and
performing our audit, and in evaluating the effect of
misstatements. We consider materiality to be the magnitude by which
misstatements, including omissions, could influence the economic
decisions of reasonable users that are taken on the basis of the
financial statements.
In order to reduce to an appropriately low level the probability
that any misstatements exceed materiality, we use a lower
materiality level, performance materiality, to determine the extent
of testing needed. Importantly, misstatements below these levels
will not necessarily be evaluated as immaterial as we also take
account of the nature of identified misstatements, and the
particular circumstances of their occurrence, when evaluating their
effect on the financial statements as a whole.
Based on our professional judgement, we determined materiality
for the financial statements as a whole and performance materiality
as follows:
Group and Parent Company financial statements
--------------------------------------- -----------------------------------------------------------------------------
2023 2022
GBPk GBPk
--------------------------------------- ------------------------------------- --------------------------------------
Materiality 74 85
--------------------------------------- ------------------------------------- --------------------------------------
Basis for determining materiality 0.5% of revenue 0.5% of revenue
--------------------------------------- ------------------------------------- --------------------------------------
Rationale for the benchmark applied We consider revenue to be the most We consider revenue to be the most
appropriate benchmark as it is one appropriate benchmark as it is one of
of the principal considerations the principal considerations
for users of the financial for users of the financial statements
statements in assessing the in assessing the financial
financial performance and performance and development
development of the Group and Parent Company.
of the Group and Parent Company.
--------------------------------------- ------------------------------------- --------------------------------------
Performance materiality 55 64
--------------------------------------- ------------------------------------- --------------------------------------
Basis for determining performance 75% of materiality - the threshold 75% of materiality - the threshold
materiality was selected to reflect the number was selected to reflect the number of
of balances subject balances subject
to estimation, the amount of audit to estimation, the amount of audit
differences historically arising and differences historically arising and
the mainly substantive the mainly substantive
approach to the audit. approach to the audit.
Reporting threshold
We agreed with the Audit Committee that we would report to them
all individual audit differences in excess of GBP4k (2022: GBP4k).
We also agreed to report differences below this threshold that, in
our view, warranted reporting on qualitative grounds.
Other information
The directors are responsible for the other information. The
other information comprises the information included in the annual
report other than the financial statements and our auditor's report
thereon. Our opinion on the financial statements does not cover the
other information and, except to the extent otherwise explicitly
stated in our report, we do not express any form of assurance
conclusion thereon. Our responsibility is to read the other
information and, in doing so, consider whether the other
information is materially inconsistent with the financial
statements or our knowledge obtained in the course of the audit, or
otherwise appears to be materially misstated. If we identify such
material inconsistencies or apparent material misstatements, we are
required to determine whether this gives rise to a material
misstatement in the financial statements themselves. If, based on
the work we have performed, we conclude that there is a material
misstatement of this other information, we are required to report
that fact.
We have nothing to report in this regard.
Corporate governance statement
The Listing Rules require us to review the Directors' statement
in relation to going concern, longer-term viability and that part
of the Corporate Governance Statement relating to the Parent
Company's compliance with the provisions of the UK Corporate
Governance Code specified for our review.
Based on the work undertaken as part of our audit, we have
concluded that each of the following elements of the Corporate
Governance Statement is materially consistent with the financial
statements or our knowledge obtained during the audit.
Going concern and longer-term viability
* The Directors' statement with regards to the
appropriateness of adopting the going concern basis
of accounting and any material uncertainties
identified set out on page 19 ; and
* The Directors' explanation as to their assessment of
the Group's prospects, the period this assessment
covers and why the period is appropriate set out on
page 8 .
---------------------------------------- ------------------------------------------------------------------
Other Code provisions
* Directors' statement on fair, balanced and
understandable set out on page 17 ;
* Board's confirmation that it has carried out a robust
assessment of the emerging and principal risks set
out on page 6 ;
* The section of the annual report that describes the
review of effectiveness of risk management and
internal control systems set out on page 26 ; and
* The section describing the work of the audit
committee set out on page 25 .
Other Companies Act 2006 reporting
Based on the responsibilities described below and our work
performed during the course of the audit, we are required by the
Companies Act 2006 and ISAs (UK) to report on certain opinions and
matters as described below.
Strategic report and Directors' report In our opinion, based on the work undertaken in the course
of the audit:
* the information given in the Strategic report and the
Directors' report for the financial year for which
the financial statements are prepared is consistent
with the financial statements; and
* the Strategic report and the Directors' report have
been prepared in accordance with applicable legal
requirements.
In the light of the knowledge and understanding of the
Group and Parent Company and its environment
obtained in the course of the audit, we have not identified
material misstatements in the
strategic report or the Directors' report.
-------------------------------------------------------- ------------------------------------------------------------
Directors' remuneration In our opinion, the part of the Directors' remuneration
report to be audited has been properly
prepared in accordance with the Companies Act 2006.
-------------------------------------------------------- ------------------------------------------------------------
Matters on which we are required to report by exception We have nothing to report in respect of the following
matters in relation to which the Companies
Act 2006 requires us to report to you if, in our opinion:
* adequate accounting records have not been kept by the
Parent Company, or returns adequate for our audit
have not been received from branches not visited by
us; or
* the Parent Company financial statements and the part
of the Directors' remuneration report to be audited
are not in agreement with the accounting records and
returns; or
* certain disclosures of Directors' remuneration
specified by law are not made; or
* we have not received all the information and
explanations we require for our audit.
Responsibilities of Directors
As explained more fully in the Statement of Directors'
responsibilities, the Directors are responsible for the preparation
of the financial statements and for being satisfied that they give
a true and fair view, and for such internal control as the
Directors determine is necessary to enable the preparation of
financial statements that are free from material misstatement,
whether due to fraud or error.
In preparing the financial statements, the Directors are
responsible for assessing the Group's and the Parent Company's
ability to continue as a going concern, disclosing, as applicable,
matters related to going concern and using the going concern basis
of accounting unless the Directors either intend to liquidate the
Group or the Parent Company or to cease operations, or have no
realistic alternative but to do so.
Auditor's responsibilities for the audit of the financial
statements
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue an
auditor's report that includes our opinion. Reasonable assurance is
a high level of assurance, but is not a guarantee that an audit
conducted in accordance with ISAs (UK) will always detect a
material misstatement when it exists. Misstatements can arise from
fraud or error and are considered material if, individually or in
the aggregate, they could reasonably be expected to influence the
economic decisions of users taken on the basis of these financial
statements.
Extent to which the audit was capable of detecting
irregularities, including fraud
Irregularities, including fraud, are instances of non-compliance
with laws and regulations. We design procedures in line with our
responsibilities, outlined above, to detect material misstatements
in respect of irregularities, including fraud. The extent to which
our procedures are capable of detecting irregularities, including
fraud is detailed below:
Non-compliance with laws and regulations
Based on our understanding of the regulatory and legal framework
applicable to the Group and Parent Company and the industry in
which it operates, we considered the risk of acts by the Group and
Parent Company which were contrary to applicable laws and
regulations, including fraud.
These included but were not limited to compliance with the
applicable accounting framework, Companies Act 2006, UK Corporate
Governance Code, the UK listing rules and UK tax legislation.
Our procedures in respect of the above included:
-- agreement of the financial statement disclosures to underling supporting documentation;
-- review of any correspondence with regulators and legal
advisors for any instances of non-compliance with laws and
regulations;
-- review of minutes of meeting of those charged with governance
for any instances of non-compliance with laws and regulations;
-- involvement of tax specialists in the audit;
-- review of legal expenditure accounts to understand the nature of expenditure incurred; and
-- enquiries made of management and those charged with
governance regarding any instances of non-compliance with laws and
regulations.
Fraud
We assessed the susceptibility of the financial statements to
material misstatement, including fraud. Our risk assessment
procedures included:
-- Enquiry with management and those charged with governance
regarding any known or suspected instances of fraud;
-- Obtained an understanding of the Group's policies and procedures relating to;
o Detecting and responding to the risks of fraud; and
o Internal controls established to mitigate risks related
fraud;
-- Review of minutes of meeting of those charged with governance
for any known or suspected instances of fraud; and
-- Discussion amongst the engagement team as to how and where
fraud might occur in the financial statements.
Based on our risk assessment, we considered that fraud risks
could arise in the existence of revenue through fraudulent journal
postings to revenue; incorrect revenue recognition at year end;
fictitious contractors or customers; manipulation of contractor
accruals; and manipulation of accrued income as well as management
override of controls. The audit procedures performed in relation to
revenue recognition are documented in the key audit matter section
of our audit report.
In response to the risk of management override of controls, we
tested the appropriateness of journal entries and other adjustments
on a sample basis to supporting documentation. We also assessed
whether the judgements made in making accounting estimates were
indicative of a potential bias and evaluated the business rationale
of any significant transactions that were unusual or outside the
normal course of business.
We also communicated relevant identified laws and regulations
and potential fraud risks to all engagement team members who were
all deemed to have appropriate competence and capabilities and
remained alert to any indications of fraud or non-compliance with
laws and regulations throughout the audit.
Our audit procedures were designed to respond to risks of
material misstatement in the financial statements, recognising that
the risk of not detecting a material misstatement due to fraud is
higher than the risk of not detecting one resulting from error, as
fraud may involve deliberate concealment by, for example, forgery,
misrepresentations or through collusion. There are inherent
limitations in the audit procedures performed and the further
removed non-compliance with laws and regulations is from the events
and transactions reflected in the financial statements, the less
likely we are to become aware of it.
A further description of our responsibilities is available on
the Financial Reporting Council's website at:
www.frc.org.uk/auditorsresponsibilities. This description forms
part of our auditor's report.
Use of our report
This report is made solely to the Parent Company's members, as a
body, in accordance with Chapter 3 of Part 16 of the Companies Act
2006. Our audit work has been undertaken so that we might state to
the Parent Company's members those matters we are required to state
to them in an auditor's report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Parent Company and the
Parent Company's members as a body, for our audit work, for this
report, or for the opinions we have formed.
James Fearon
(Senior Statutory Auditor)
9 June 2023
For and on behalf of BDO LLP, Statutory Auditor
London, UK
BDO LLP is a limited liability partnership registered in England
and Wales (with registered number OC305127).
Statements of comprehensive income and expense
for the year ended 31 March 2023
Group and Company Note 2023 2022
GBP'000 GBP'000
Revenue 4 14,858 17,015
Cost of sales (11,354) (12,231)
----------------------------------------------------------------------------------------- ----- --------- ---------
Gross profit 3,504 4,784
Administrative expenses (3,469) (3,676)
----------------------------------------------------------------------------------------- ----- --------- ---------
Profit from operations 5 35 1,108
Finance income 13 17 10
Finance expense 6 (43) (37)
----------------------------------------------------------------------------------------- ----- --------- ---------
Profit before tax 9 1,081
Tax (Charge)/Credit 8 (53) 88
----------------------------------------------------------------------------------------- ----- --------- ---------
(Loss)/Profit for the year and total comprehensive income attributable to equity holders
of
the parent (44) 1,169
----------------------------------------------------------------------------------------- ----- --------- ---------
Basic (loss)/earnings per share 10 (0.27p) 7.16p
----------------------------------------------------------------------------------------- ----- --------- ---------
Diluted (loss)/earnings per share 10 (0.27p) 7.04p
----------------------------------------------------------------------------------------- ----- --------- ---------
All amounts relate to continuing activities.
The notes on pages 54 to 74 form part of the financial
statements.
Statements of changes in equity for the year ended 31 March
2023
Group Share Capital Share premium account Capital redemption Retained earnings Total
reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 April 2021 160 666 104 4,353 5,283
Profit for the year
and total
comprehensive income - - - 1,169 1,169
Ordinary shares issued 5 214 - - 219
Dividend paid (note 9) - - - (653) (653)
Share-based payments - - - - -
----------------------- -------------- ---------------------- ----------------------- ------------------ --------
At 1 April 2022 165 880 104 4,869 6,018
Loss for the year and
total comprehensive
income - - - (44) (44)
Ordinary shares issued 1 14 - - 15
Dividend paid (note 9) - - - (995) (995)
Share-based payments - - - 200 200
----------------------- -------------- ---------------------- ----------------------- ------------------ --------
At 31 March 2023 166 894 104 4,030 5,194
----------------------- -------------- ---------------------- ----------------------- ------------------ --------
Company Share Share premium account Capital redemption Retained earnings Total
Capital reserve
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
At 1 April 2021 160 666 104 4,348 5,278
Profit for the year
and total
comprehensive income - - - 1,169 1,169
Ordinary shares issued 5 214 - - 219
Dividend paid (note 9) - - - (653) (653)
Share-based payments - - - - -
----------------------- -------------- ---------------------- ----------------------- ------------------ --------
At 1 April 2022 165 880 104 4,864 6,013
Loss for the year and
total comprehensive
income - - - (44) (44)
Ordinary shares issued 1 14 - - 15
Dividend paid (note 9) - - - (995) (995)
Share-based payments - - - 200 200
----------------------- -------------- ---------------------- ----------------------- ------------------ --------
At 31 March 2023 166 894 104 4,025 5,189
----------------------- -------------- ---------------------- ----------------------- ------------------ --------
Share capital represents the amount subscribed for share capital
at nominal value.
The share premium account represents the amount subscribed for
share capital in excess of the nominal value.
The capital redemption reserve represents the nominal value of
the purchase and cancellation of its own shares by the Company in
2002.
Retained earnings represents the cumulative net gains and losses
recognised in the statement of comprehensive income and
expense.
The notes on pages 54 to 74 form part of the financial
statements.
Statements of financial position at 31 March 2023
Registered number: 02285049
Group Company
Note 2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
Non-current assets
Intangible assets 11 1 2 1 2
Property, plant and equipment 12 199 278 199 278
Right-of-use assets 13 572 345 572 345
Finance lease receivables 13 396 - 396 -
Trade and other receivables 15 - 130 - 130
Deferred tax 8 108 161 108 161
------------------------------- ----- -------- -------- -------- --------
1,276 916 1,276 916
------------------------------- ----- -------- -------- -------- --------
Current assets
Trade and other receivables 15 2,541 2,554 2,541 2,554
Finance lease receivables 13 94 84 94 84
Cash and cash equivalents 16 4,795 5,325 4,795 5,325
------------------------------- ----- -------- -------- -------- --------
7,430 7,963 7,430 7,963
------------------------------- ----- -------- -------- -------- --------
Total assets 8,706 8,879 8,706 8,879
------------------------------- ----- -------- -------- -------- --------
Current liabilities
Trade and other payables 17 (2,269) (2,134) (2,274) (2,139)
Short term provisions 18 - (61) - (61)
Lease liabilities 13 (292) (269) (292) (269)
------------------------------- ----- -------- -------- -------- --------
(2,561) (2,464) (2,566) (2,469)
------------------------------- ----- -------- -------- -------- --------
Non-current liabilities
Trade and other payables 17 - (104) - (104)
Long term provisions 18 (197) (136) (197) (136)
Lease liabilities 13 (754) (157) (754) (157)
------------------------------- ----- -------- -------- -------- --------
(951) (397) (951) (397)
------------------------------- ----- -------- -------- -------- --------
Total liabilities (3,512) (2,861) (3,517) (2,866)
------------------------------- ----- -------- -------- -------- --------
Net assets 5,194 6,018 5,189 6,013
------------------------------- ----- -------- -------- -------- --------
Shareholders' equity
Share capital 19 166 165 166 165
Share premium account 894 880 894 880
Capital redemption reserve 104 104 104 104
Retained earnings 4,030 4,869 4,025 4,864
------------------------------- ----- -------- -------- -------- --------
Total shareholders' equity 5,194 6,018 5,189 6,013
------------------------------- ----- -------- -------- -------- --------
The financial statements on pages 50 to 75 were approved by the
Board of Directors and authorised for issue on 9 June 2023 and were
signed on its behalf by:
Adrian Leer James McDonald
Director Director
Triad Group Plc is registered in England and Wales with
registered number 02285049
The notes on pages 54 to 74 form part of the financial
statements.
Statements of cash flows for the year ended 31 March 2023
Group and company Note 2023 2022
GBP'000 GBP'000
Cash flows from operating activities
Profit for the year before taxation 9 1,081
Adjustments for:
Depreciation of property, plant and equipment 12 87 79
Amortisation of right of use assets 13 185 187
Amortisation of intangible assets 11 1 5
Interest received 13 (17) (10)
Finance expense 6 43 35
Share-based payment expense 200 -
Changes in working capital
Decrease/(Increase) in trade and other receivables 143 (169)
Increase/(Decrease) in trade and other payables 32 (11)
Cash generated by operations 683 1,197
Foreign exchange gain 1 1
------------------------------------------------------ ----- --------- ---------
Net cash inflow from operating activities 684 1,198
------------------------------------------------------ ----- --------- ---------
Investing activities
Finance lease interest received 13 17 10
Finance lease payments received 13 102 109
Purchase of intangible assets 11 - (1)
Purchase of property, plant and equipment 12 (9) (132)
------------------------------------------------------ ----- --------- ---------
Net cash used in investing activities 110 (14)
------------------------------------------------------ ----- --------- ---------
Financing activities
Proceeds of issue of shares 15 220
Lease liabilities principal payments 13 (300) (307)
Lease liabilities interest payments 13 (44) (37)
Dividends paid 9 (995) (653)
------------------------------------------------------ ----- --------- ---------
Net cash outflow from financing activities (1,324) (777)
------------------------------------------------------ ----- --------- ---------
Net (decrease)/increase in cash and cash equivalents (530) 407
Cash and cash equivalents at beginning of the period 5,325 4,918
------------------------------------------------------ ----- --------- ---------
Cash and cash equivalents at end of the period 16 4,795 5,325
------------------------------------------------------ ----- --------- ---------
The notes on pages 54 to 74 form part of the financial
statements.
Notes to the financial statements for the year ended 31 March
2023
1. Principal accounting policies
Basis of preparation for Group and Company
The principal accounting policies adopted in the preparation of
the financial statements are set out below. The policies have been
consistently applied to all the years presented, unless otherwise
stated.
These financial statements have been prepared in accordance with
UK adopted International Financial Reporting Standards (IFRSs) and
the provisions of the Companies Act 2006.
These financial statements have been prepared on a historical
cost basis and are presented in pounds sterling, generally rounded
to the nearest thousand, the presentational currency of the
Group.
Going concern
The Group's business activities, together with the factors
likely to affect its future development, performance and position,
are set out in the Strategic report. The financial position of the
Group and Parent Company, its cash flows, liquidity position and
borrowing facilities are described in the Strategic report. In
addition, note 3 to the financial statements includes the Group's
objectives, policies and processes for managing its capital, its
financial risk management objectives, details of its financial
instruments and hedging activities, and its exposure to credit risk
and liquidity risk. The Group and Parent Company meets their day to
day working capital requirements through cash reserves and an
invoice finance facility (which is currently unutilised).
The Group and Parent Company operates an efficient low-cost and
historically cash generative model. The client base generally
consists of large blue-chip entities, particularly within the
public sector, enjoying long-term and productive client
relationships. As such, debtor recovery has been reliable and
predictable with a low exposure to bad debts. For the year ended 31
March 2023, the Group and Parent Company have not utilised any
external debt or the current finance facility.
The going concern assessment considered a number of realistic
scenarios covering the period ending 30 September 2024, including
the ability of future client acquisition, and the impact of the
reduction in services of key clients upon future cash flows. In
addition, in the most severe scenario possible, a reverse stress
test was modelled which included all current client contracts
discontinued at expiry with no extension or replacement and with no
cost mitigation. Even in the most extreme scenario, the Group and
Parent Company has enough liquidity and long-term contracts to
support the business through the going concern period. The
Directors have concluded from these assessments that the Group and
Parent Company would have sufficient headroom in cash balances to
continue in operation.
Further information in relation to the Directors' consideration
of the going concern position of the Group is contained in the
Viability statement on page 8 .
After making enquiries, including a review of the wider economy
including Brexit, inflationary pressures and the Ukraine conflict,
the Directors have a reasonable expectation that the Group has
adequate resources to continue in operational existence for the
foreseeable future and at least twelve months from the date of
approval of the financial statements. Accordingly, they continue to
adopt the going concern basis in preparing the annual report and
accounts.
Basis of consolidation
Where the Company has control over an investee, it is classified
as a subsidiary. The Company controls an investee if all three of
the following elements are present: power over the investee,
exposure to variable returns from the investee and the ability of
the investor to use its power to affect those variable returns. The
consolidated financial statements present the results of the
Company and its subsidiaries ("the Group") as if they formed a
single entity. Intercompany transactions and balances between Group
companies are therefore eliminated in full.
Property, plant and equipment
Property, plant and equipment are stated at cost, net of
accumulated depreciation and any impairment in value.
Depreciation is calculated as to write off the cost of assets,
less their estimated residual values, on a straight-line basis over
the expected useful economic lives of the assets concerned.
Depreciation is charged to administrative expenses in the statement
of comprehensive income and expense. The principal annual rates
used for this purpose are:
%
======================== ======
Computer hardware 25-33
======================== ======
Fixtures and fittings 10-33
======================== ======
Motor vehicles 25-33
======================== ======
Leasehold improvements 10-33
Intangible assets
Intangible assets are stated at cost, net of accumulated
amortisation and any impairment in value. The cost of internally
developed software is the attributable salary costs and directly
attributable overheads.
Amortisation is calculated to write off the cost of assets, less
their estimated residual values, on a straight-line basis over the
expected useful economic lives of the assets concerned.
Amortisation is charged to administration expenses in the statement
of comprehensive income and expense. The principal annual rates
used for this purpose are:
%
============================= ======
Purchased computer software 25-33
Impairment of non-financial assets
Non-financial assets are subject to impairment tests whenever
events or changes in circumstances indicate that their carrying
amount may not be recoverable. Where the carrying value of an asset
exceeds its recoverable amount the asset is written down
accordingly. Impairment is charged to administration expenses in
the statements of comprehensive income and expense.
Trade and other receivables
Trade and other receivables are initially recognised at fair
value plus transaction costs, and subsequently measured at
amortised cost using the effective interest method, less provision
for impairment.
At each reporting date an amount of impairment is recognised as
lifetime expected credit losses (lifetime ECL's).
Lifetime ECL's are calculated using a provision matrix that
groups trade receivables according to the time past due, and at
provision rates based on historical observed default rates,
adjusted for forward looking estimates. At every reporting date,
the historical observed default rates and forward-looking estimates
are updated.
Cash and cash equivalents
Cash and cash equivalents in the statement of financial position
comprises cash held on demand with banks. The carrying amount of
these assets is equal to their fair value.
Trade and other payables
Trade and other payables are recognised initially at fair value,
and subsequently measured at amortised cost using the effective
interest method.
Leases
The Group as Lessee:
All leasing arrangements, where the Group is the lessee (defined
as leases that last more than one year or of a high value), are
recognised as a lease liability and corresponding right-of-use
asset.
Lease liability:
The lease liability is calculated as the discounted total fixed
payments for the lease term, termination payments, exercise price
of purchase options, residual value guarantee and certain variable
payments. An interest charge is recognised in the statement of
comprehensive income and expense on the lease liability at an
incremental borrowing rate. The lease liability is presented across
separate lines (current and non-current) in the statement of
financial position. The lease liability increases to reflect the
interest charge on the lease liability, at an incremental borrowing
rate. The lease liability reduces over the period of the lease as
payments are made. The lease liability is re-calculated if there is
a modification, a change in the lease term, a change in the lease
payments or a change in the assessment to purchase the underlying
assets.
Right-of-use assets:
The right-of-use asset is calculated as the original lease
liability, initial direct costs and amounts paid upfront. The right
of use asset is subsequently measured at cost less accumulated
amortisation. The amortisation is charged on a straight-line basis
over the life of the lease.
The Group as lessor:
For the year ended 31 March 2023 lessor arrangements follow the
accounting treatment 'IFRS 16 Leases'. Where the lease indicates a
finance lease a lease receivable is recognised. The lease
receivable is calculated as the discounted total lease receipts for
the lease term.
Interest income is subsequently recognised in the statement of
comprehensive income and the payment received against the lease
receivable. The balance reduces over the lease term as receipts are
received.
Foreign currencies
Assets and liabilities expressed in foreign currencies are
translated into sterling at the exchange rate ruling on the date of
the statement of financial position. Transactions in foreign
currencies are recorded at the exchange rate ruling as at the date
of the transaction. All differences on exchange are taken to the
statement of comprehensive income and expense in the year in which
they arise.
Revenue
Revenue recognised in any financial period is based on the
delivery of performance obligations and an assessment of when
control is transferred to the customer. Revenue is either
recognised at a 'point in time' when a performance obligation has
been performed, or 'over time' as control of the performance
obligation is transferred to the customer.
The majority of the Group's revenue is derived from the
provision of services under time and materials contracts.
Performance obligations under such contracts relate to the
provision of staff to customers. The transaction price of the
performance obligation is determined by reference to charge-out
rates for supplied staff specified in the contract and any
recoverable expenses. Since the customer simultaneously receives
and consumes the benefits of the Group's performance obligations
under such contracts, revenue is recognised over time using the
output method which uses a direct measurement of value to the
customer of the services transferred to date.
Where temporary workers are supplied to customers, the
associated revenue is recognised gross (inclusive of the cost of
the temporary workers) since the Group is acting as principal.
Under IFRS 15, in order to be recognised as principal, there must
be a transfer of control between the vendor and the customer. Where
the Group provides temporary contractors, it is acting as principal
since it receives resourcing requirements directly from the
customer, has prime responsibility to find suitable candidates and
negotiate pay rates with them, and delivers the resources to the
client including acceptance that the service provided meets the
client's expectations. Revenue is therefore recognised as the gross
amount invoiced to customers.
In relation to time and materials contracts, since it has a
right to consideration from a customer in an amount that
corresponds directly with the value to the customer of the Group's
performance completed to date, the Group recognises revenue in the
amount to which it has a right to invoice.
Revenue from fixed price contracts, which may include software
and product development or support contracts, is determined by
reference to those fixed prices, agreed at inception of the
contract. For fixed price contracts revenue is recognised on an
over time basis using the input (percentage completion) method.
Percentage completion is calculated as the total hours worked as at
the statement of financial position date divided by the total
expected hours to be worked to complete the project. Revenue for
permanent recruitment services is based on a percentage of a
successful candidate's remuneration package, as agreed with the
customer at inception of the contract. Revenue is recognised at a
point in time when the performance obligation has been satisfied at
the time the candidate commences employment and subject to a
provision for clawback of fees for candidates that leave prior to
the notice period ending.
Revenue from licences is recognised net at the point of
transaction. The Group enters into a distinct contract with a
client for the licences. The Group acts as a reseller and the
Client is bound by the terms and conditions of the end user
agreement of the licence provider. As control of the licences are
transferred to the client at contract agreement, the Group is
acting as agent which enables the recognition of revenue at the
point of transaction.
The Company has taken advantage of the practical exemption not
to disclose the value of unfilled performance obligations as the
contracts ongoing at the period end are for less than 12
months.
Taxation
The charge for taxation is based on the profit or loss for the
year as adjusted for disallowable items. It is calculated using tax
rates that have been enacted or substantively enacted by the
statement of financial position date.
Full provision is made for deferred tax on all temporary
differences resulting from the difference between the carrying
value of an asset or liability and its tax base, and on tax losses
carried forward indefinitely. Deferred tax assets are recognised to
the extent that it is probable that the deferred tax asset will be
recovered in the foreseeable future. Deferred tax is calculated at
the tax rates that are expected to apply to the period when the
asset is realised or liability is settled.
Pension costs
Contributions to defined contribution plans are charged to the
statements of comprehensive income and expense as the contributions
accrue.
Share-based payments
Share-based incentive arrangements are provided to employees
under the Group's share option and conditional share incentive
award scheme. Both awards granted to employees are valued at the
date of grant using an appropriate option pricing model and are
charged to operating profit over the performance or vesting period
of the scheme. The annual charge is modified to take account of
shares forfeited by employees who leave during the performance or
vesting period and, in the case of non-market related performance
conditions, where it becomes unlikely the option will vest.
Provisions
A provision is recognised when the Group has a legal or
constructive obligation as a result of a past event and it is
probable that an outflow of economic benefits will be required to
settle the obligation. If the effect is material, expected future
cash flows are discounted using a current pre-tax rate that
reflects the risks specific to the liability. Calculations of these
provisions require judgements to be made. The Group has provided
for property dilapidation as detailed in note 18.
New standards and interpretations
Climate change accounting
In preparing the Consolidated financial statements management
has considered the impact of climate change, particularly in the
context of the disclosures included in the Strategic Report. These
considerations did not have a material impact on the financial
reporting judgements and estimates.
A number of amendments to existing standards have been issued
but which are not yet mandatory, and have not been adopted by the
Group in these financial statements. The Directors do not
anticipate that their adoption in future periods will have a
material impact on the financial statements of the Group.
2. Critical accounting estimates and judgements
Estimates and judgements are continually evaluated based on
historical experience and other factors, including expectations of
future events that are believed to be reasonable under the
circumstances. The Group makes estimates and assumptions concerning
the future. The resulting accounting estimates will, by definition,
seldom equal the related actual results. The estimates and
assumptions that have a significant risk of causing a material
adjustment to the carrying amounts of assets and liabilities within
the next financial year are discussed below.
Key judgements and sources of estimation uncertainty
................................
IFRS 16 leases
A right-of-use asset of GBP0.6m (2022: GBP0.3m), a total lease
liability of GBP1.0m (2022: GBP0.4m) and a finance lease receivable
of GBP0.5m (2022: GBP0.1m) have been recognised in accordance with
the accounting policies on page 56 with respect to IFRS 16
'Leases'. During the year, a lease break option was not enacted on
a property lease, which resulted in an increase to the right of use
asset (GBP412k), the lease liability (GBP920k) and the finance
lease receivable (GBP508k). The Directors have made the following
critical accounting estimates and judgements in relation to these
balances:
-- Lease term: The Directors are of the opinion that property
lease assets and liabilities should generally be calculated with
relation to the first available break date as the expectation is
that the lease break may be taken. During the lease break review
period, trading and market conditions will be taken into account
and assets and liabilities will be calculated.
-- Incremental borrowing rate (IBR): The Directors have
calculated the IBR at 5%, based upon readily available credit
facilities and Bank of England base rate, covering a time frame
commensurate with the time to the first available break date.
Dilapidation provisions:
The Directors have recognised a dilapidation provision for both
the leases held totalling GBP197,000 (2022: GBP197,000). The
provision is required to recognise the costs of restoring the
properties to their original state at the end of the lease period.
The provision has been calculated based upon industry accepted
averages on floor space by price per square meter and the
Directors' experience with the landlords, as well as experience in
similar negotiations.
Deferred taxation:
The Directors have recognised a deferred tax asset of GBP108k
(2022: GBP161k). This asset is to recognise the expectation that
corporation tax losses brought forward will be utilised against
future taxable profits. The Directors' have based this upon a
conservative estimation of the level of taxable profits in the
medium-term.
3. Financial risk management
The Group uses financial instruments that are necessary to
facilitate its ordinary purchase and sale activities, namely cash,
bank borrowings in the form of a receivables finance facility and
trade payables and receivables: the resultant risks are foreign
exchange risk, interest rate risk, credit risk and liquidity risk.
The Group does not use financial derivatives in its management of
these risks.
The Board reviews and agrees policies for managing these risks
and they are summarised below. These policies are consistent with
last year.
3.1 Financial risk factors
Foreign exchange risk
There are a small number of routine trading contracts with both
suppliers and clients in euros. In all such circumstances the
contracts with supplier and client will be in the same currency
thereby mitigating the Group's exposure to movements in exchange
rates. Payments and receipts are made through a bank account in the
currency of the contract therefore balances held in any foreign
currency are to facilitate day to day transactions. With the
trading Company's functional currency of sterling there are the
following foreign currency net assets:
Group and company Note 2023 2022
GBP'000 GBP'000
Currency: Euros
Cash and cash equivalents 16 18 86
Trade and other receivables 15 - (10)
18 76
----------------------------- ----- -------- --------
Any change in currency rates would have no significant effect on
results.
Interest rate risk
The Group has access to a financing facility with a major UK
bank. At the balance sheet date in the current or prior year this
facility has not been utilised. The facility borrowing rate is
1.75% above base rate and so when required to be utilised, this
represents an interest rate risk.
Cash balances are held in short-term interest-bearing accounts,
repayable on demand: these attract interest rates which fluctuate
in relation to movements in bank base rate. This maintains
liquidity and does not commit the Group to long term deposits at
fixed rates of interest.
There were no borrowings, aside from lease liabilities arising
from the application of IFRS 16, during the year.
Credit risk
The Group is mainly exposed to credit risk from credit sales. It
is Group policy to assess the credit risk of new customers before
entering into contracts. Each new customer is assessed, using
external ratings and relevant information in the public domain
before any credit limit is granted. In addition, trade receivables
balances are monitored on a regular basis to minimise exposure to
credit losses. The amount credited to the income statement during
the year in respect of expected credit losses was GBP9,000 (2022:
credited to the income statement GBP5,000).
The Group is also exposed to credit risk from contract assets,
being revenue earned but not yet invoiced (note 15).
The Group also has credit risk from cash deposits with banks
(note 16).
The Group's maximum exposure to credit risk is:
Group and company Note 2023 2022
GBP'000 GBP'000
Finance lease receivable 13 490 84
Trade and other receivables 15 2,001 2,113
Contract assets 15 225 212
Other debtors 15 - 208
Cash and cash equivalents 16 4,795 5,325
----------------------------- ----- -------- --------
7,511 7,942
----------------------------- ----- -------- --------
Liquidity risk
The Group's liquidity risk arises from its management of working
capital. The Group has a facility to borrow an amount up to 90% of
approved trade debtors subject to a maximum limit of GBP2.6m. The
facility may be terminated by the bank and Group with one and three
month's written notice respectively. The Board receives regular
cash flow and working capital projections to enable it to monitor
its available headroom under this facility. At the statement of
financial position these projections indicated that the Group
expected to have sufficient liquid resources to meet its reasonably
expected obligations. Maturity of financial liabilities is set out
in note 17.
Capital risk management
The Group's capital comprises of shareholders' equity. Its
objectives when managing capital are to safeguard the Group's
ability to continue as a going concern in order to maximise
shareholder value. To maintain or adjust the capital structure the
Group may adjust the dividend payment to shareholders, return
capital to shareholders, issue new shares or alter the level of
borrowings.
3.2 Fair value estimation
The carrying value of financial assets and liabilities
approximate their fair values.
4. Revenue
The Group operates solely in the UK. All material revenues are
generated in the UK.
The largest single customer contributed 32% of Group revenue
(2022: 35%) and was in the public sector. Four other customers
contributed more than 10% of Group revenue (2022: two).
Disaggregation of revenue
In accordance with IFRS 15, the Group disaggregates revenue by
contract type as management believe this best depicts how the
nature, timing and uncertainty of the Group's revenue and cash
flows are affected by economic factors. Accordingly, the following
table disaggregates the Group's revenue by contract type:
Group and company 2023 2022
GBP'000 GBP'000
Time and materials 14,386 16,593
Fixed price 442 118
Permanent recruitment fees 18 211
Licences 12 93
----------------------------- -------- --------
14,858 17,015
---------------------------- -------- --------
The Group also disaggregates revenue by operating sector
reflecting the different commercial risks (e.g. credit risk)
associated with each.
Group and company 2023 2022
GBP'000 GBP'000
Public sector 11,597 11,090
Private sector 3,261 5,925
-------------------- -------- --------
14,858 17,015
------------------- -------- --------
Contract balances
For all contracts, the Group recognises a contract liability to
the extent that payments made are greater than the revenue
recognised at the period end date. When payments are made less than
the revenue recognised at the period end date, the Group recognises
a contract asset for the difference.
Contract assets and contract liabilities are included within
'trade and other receivables' and 'trade and other payables'
respectively on the face of the statement of financial
position.
Contract assets Contract liabilities
Group and Company 2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
At 1 April 471 170 (116) (256)
Transfers in the period from contract assets to trade receivables (471) (170) - -
Excess of revenue recognised over cash (or right to cash) being
recognised in the period 375 471 - -
Amounts included in contract liabilities that was recognised as revenue
in the period - - 116 256
Cash received in advance of performance and not recognised as revenue in
the period - - (37) (116)
------------------------------------------------------------------------- -------- -------- ----------- ----------
At 31 March 375 471 (37) (116)
------------------------------------------------------------------------- -------- -------- ----------- ----------
There is no expectation of a material expected lifetime credit
loss arising in relation to contract assets.
5. Profit from operations
2023 2022
GBP'000 GBP'000
Profit from operations is stated after charging:
Depreciation of owned assets (note 12) 87 79
Amortisation of right of use assets (note 13) 185 187
Amortisation of intangible assets (note 11) 1 5
Auditor remuneration:
Audit of financial statements: Group and Company 94 66
Non-audit services - 2
-------------------------------------------------- -------- --------
6. Finance expense
2023 2022
GBP'000 GBP'000
Interest expense on lease liability 44 37
Net foreign exchange gain (1) -
------------------------------------- ---------- ----------
Total finance expense 43 37
------------------------------------- ---------- ----------
7. Employees and Directors
Group and Company 2023 2022
Number Number
Average number of persons (including Directors) employed
Senior management 9 10
Fee earners 93 77
Sales 8 8
Administration and finance 5 9
-------------------------------------------------------------- -------- --------
115 104
-------------------------------------------------------------- -------- --------
The number of permanent fee earners as at 31 March 2023 was 96 (2022: 95).
Staff costs for the above persons (including Directors) 2023 2022
GBP'000 GBP'000
Wages and salaries 7,907 6,995
Social security costs 981 827
Defined contribution pension costs 940 798
Equity settled share-based payments 200 -
-------------------------------------------------------------- -------- --------
10,028 8,620
-------------------------------------------------------------- -------- --------
2023 2022
Directors GBP'000 GBP'000
Emoluments 648 894
Benefits in kind 21 20
Money purchase pension contributions 74 65
-------------------------------------- -------- --------
Total remuneration 743 979
-------------------------------------- -------- --------
Social security costs 85 115
-------------------------------------- -------- --------
828 1,094
-------------------------------------- -------- --------
Three Directors (2022: 3) had retirement benefits accruing under
money purchase pension schemes. Key management personnel are
considered to be the Directors. Further information on Director's
remuneration can be found on page 29 .
8. Tax charge/(credit)
2023 2022
GBP'000 GBP'000
Current tax
Current tax on profits for the year - -
Deferred tax
Decrease/(Increase) in recognised deferred tax asset 40 (85)
Change in tax rate 13 (3)
------------------------------------------------------ -------- --------
Total tax charge/(credit) for the year 53 (88)
------------------------------------------------------ -------- --------
The differences between the actual tax charge for the year and
the standard rate of corporation tax in the UK applied to profits
for the year are as follows:
2023 2022
GBP'000 GBP'000
Profit before tax 9 1,081
Profit before tax multiplied by standard rate of corporation tax in the UK of 19% (2022: 19%) 2 205
Expenses not deductible for tax purposes 4 8
Allowances recognised (13) (91)
Derecognition/(Recognition) of deferred tax on losses 58 (220)
Change in tax rate 13 (3)
Prior year adjustments (11) 13
----------------------------------------------------------------------------------------------- -------- --------
Tax charge/(credit) for the year 53 (88)
----------------------------------------------------------------------------------------------- -------- --------
2023 2022
GBP'000 GBP'000
Deferred tax asset
The movement in deferred tax is as follows:
At beginning of the year 161 73
Reversal of previously (recognised)/unrecognised deferred tax on losses (40) 85
Tax rate changes (13) 3
------------------------------------------------------------------------- -------- --------
At end of the year 108 161
------------------------------------------------------------------------- -------- --------
Deferred tax assets have been recognised in respect of tax
losses where the Directors believe it is probable that the assets
will be recovered. This expectation of recovery is calculated by
modelling estimates of future taxable profits that can be offset
with historic trading losses brought forward. A deferred tax asset
amounting to GBP484,000 (2022: GBP473,000) has not been recognised
in respect of trading losses of GBP1,934,000 (2022: GBP1,892,000),
which can be carried forward indefinitely.
Deferred tax assets have not been recognised for potential
temporary differences arising from unexercised share options and
Restricted stock options of GBP130k (2022: GBP22k) and general
provisions of GBP21k (2022: GBP42k) as the Directors believe it is
not certain these assets will be recovered.
The UK Budget on 3 March 2021 announced an increase in the UK
corporation tax rate from 19% to 25% with effect from 1 April 2023.
The effect of the rate increase is reflected in the consolidated
financial statements as has been substantively enacted at the
balance sheet date.
9. Dividends
2023 2022
GBP'000 GBP'000
Final dividend for the year ended 31 March 2022 - 4p (2021: 2p) per share (declared and paid
in the following year) 663 323
Interim dividend for the year ended 31 March 2023 - 2p (2022: 2p) per share 332 330
---------------------------------------------------------------------------------------------- -------- --------
Total dividend paid 995 653
---------------------------------------------------------------------------------------------- -------- --------
The Directors propose a final dividend of 4p per share (2022: 4p
per share), bringing the total dividend to 6p for the financial
year (2022: 6p per share).
10. Earnings per ordinary share
Earnings per share have been calculated on the profit for the
year divided by the weighted average number of shares in issue
during the period based on the following:
2023 2022
(Loss)/Profit for the year (GBP44,000) GBP1,169,000
--------------------------------------------------------- ---------------- ----------------
Average number of shares in issue 16,565,870 16,325,415
Effect of dilutive options - 288,934
--------------------------------------------------------- ---------------- ----------------
Average number of shares in issue plus dilutive options 16,565,870 16,614,349
--------------------------------------------------------- ---------------- ----------------
Basic (loss)/earnings per share (0.27p) 7.16p
--------------------------------------------------------- ---------------- ----------------
Diluted (loss)/earnings per share (0.27p) 7.04p
--------------------------------------------------------- ---------------- ----------------
11. Intangible assets
Group and company Purchased software
GBP'000
Cost
At 31 March 2021 127
Additions 1
Disposals -
------------------------------------- -------------------
At 31 March 2022 128
Additions -
Disposals -
------------------------------------- -------------------
At 31 March 2023 128
------------------------------------- -------------------
Accumulated amortisation/impairment
At 31 March 2021 121
Charge for the year 5
Disposals -
------------------------------------- -------------------
At 31 March 2022 126
Charge for the year 1
Disposals -
------------------------------------- -------------------
At 31 March 2023 127
------------------------------------- -------------------
Net book value
At 31 March 2023 1
------------------------------------- -------------------
At 31 March 2022 2
------------------------------------- -------------------
12. Property, plant and equipment
Group and company Computer Fixtures Motor Total
hardware & fittings vehicles
GBP'000 GBP'000 GBP'000 GBP'000
Cost
At 31 March 2021 219 509 4 732
Additions 43 89 - 132
Disposals (26) (8) - (34)
-------------------------- ---------- ------------ ---------- --------
At 31 March 2022 236 590 4 830
Additions 7 2 - 9
Disposals (2) - - (2)
-------------------------- ---------- ------------ ---------- --------
At 31 March 2023 241 592 4 837
-------------------------- ---------- ------------ ---------- --------
Accumulated depreciation
At 31 March 2021 162 341 4 507
Charge for the year 28 51 - 79
Disposals (26) (8) - (34)
-------------------------- ---------- ------------ ---------- --------
At 31 March 2022 164 384 4 552
Charge for the year 30 57 - 87
Disposals (1) - - (1)
-------------------------- ---------- ------------ ---------- --------
At 31 March 2023 193 441 4 638
-------------------------- ---------- ------------ ---------- --------
Net book value
At 31 March 2023 48 151 - 199
-------------------------- ---------- ------------ ---------- --------
At 31 March 2022 72 206 - 278
-------------------------- ---------- ------------ ---------- --------
13. Leases
The Group as a lessee:
The Group has lease contracts for its office premises with terms
remaining ranging from 1 to 5 years. The lease liability has been
calculated on the basis of the termination option being taken.
There are no other future cash outflows in relation to the lease to
which the Group is potentially exposed. Each lease is represented
on the balance sheet as a right of use asset and a lease liability.
Short-term leases are not recognised and expensed to the profit and
loss statement.
Right-of-use assets
During the year, a lease break option on one lease was not
enacted, and the lease now continues until 27th March 2028. As of
this date, the total asset value has been increased by
GBP412,000.
The carrying amounts of the right-of-use assets are as
follows:
Land and buildings Total
GBP'000 GBP'000
At 31 March 2021
Opening position 532 532
Amortisation (187) (187)
---------------------- ------------------- --------
At 31 March 2022 345 345
---------------------- ------------------- --------
Change in lease term 412 412
Amortisation (185) (185)
---------------------- ------------------- --------
At 31 March 2023 572 572
---------------------- ------------------- --------
Lease liabilities
During the year, the lease break option on one lease was not
enacted, and the lease now continues until 27(th) March 2028. As of
this date, the total lease liability has increased by
GBP920,000.
The carrying amount of the lease liabilities recognised are as
follows:
Land and buildings Total
GBP'000 GBP'000
At 31 March 2021
Opening position 733 733
Interest expense 37 37
Lease payments (344) (344)
---------------------- ------------------- --------
At 31 March 2022 426 426
---------------------- ------------------- --------
Change in lease term 920 920
Interest expense 44 44
Lease payments (344) (344)
---------------------- ------------------- --------
At 31 March 2023 1,046 1,046
---------------------- ------------------- --------
At the balance sheet date, the Group had outstanding commitments
for future lease payments as follows:
At 31 March 2022 Up to 3 months Between 3 and 12 months Between 1 and 2 years Between 2 and 5 years
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- --------------- ------------------------ ---------------------- ----------------------
Discounted lease
liabilities 81 188 121 36
--------------------------- --------------- ------------------------ ---------------------- ----------------------
Undiscounted lease
liabilities 86 204 129 38
--------------------------- --------------- ------------------------ ---------------------- ----------------------
At 31 March 2023 Up to 3 months Between 3 and 12 months Between 1 and 2 years Between 2 and 5 years
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- --------------- ------------------------ ---------------------- ----------------------
Discounted lease
liabilities 72 220 215 539
--------------------------- --------------- ------------------------ ---------------------- ----------------------
Undiscounted lease
liabilities 86 258 253 591
--------------------------- --------------- ------------------------ ---------------------- ----------------------
The Group as a lessor:
Finance lease receivables
The Group has entered into a lease arrangement considered to be
a finance lease, representing rentals payable to the Group for a
rental of a proportion of a leased property.
During the year, a lease break option on one lease was not
enacted by a tenant, and the lease now continues until 23(rd) March
2028. As of this date, the total finance lease receivable has
increased by GBP508,000.
The carrying amounts of the lease receivable asset are as
follows:
Land and buildings Total
GBP'000 GBP'000
At 31 March 2021
Opening position 193 193
Interest income 10 10
Payments received (119) (119)
---------------------- ------------------- --------
At 31 March 2022 84 84
---------------------- ------------------- --------
Change in lease term 508 508
Interest income 17 17
Payments received (119) (119)
---------------------- ------------------- --------
At 31 March 2023 490 490
---------------------- ------------------- --------
At the balance sheet date, the Group had future lease
receivables as follows:
At 31 March 2022 Up to 3 months Between 3 and 12 months
GBP'000 GBP'000
-------------------------------- --------------- ------------------------
Discounted lease receivables 28 56
-------------------------------- --------------- ------------------------
Undiscounted lease receivables 30 59
-------------------------------- --------------- ------------------------
At 31 March 2023 Up to 3 months Between 3 and 12 months Between 1 and 2 years Between 2 and 5 years
GBP'000 GBP'000 GBP'000 GBP'000
--------------------------- --------------- ------------------------ ---------------------- ----------------------
Discounted lease
receivables 23 71 99 297
--------------------------- --------------- ------------------------ ---------------------- ----------------------
Undiscounted lease
receivables 30 89 119 326
--------------------------- --------------- ------------------------ ---------------------- ----------------------
The total lease receivable of GBP490k (2022: GBP84k) is
disclosed as non-current assets of GBP396k (2022: GBPnil) and
current assets of GBP94k (2022: GBP84k).
14. Investments
Company
Investments are:
(a) Generic Software Consultants Limited ("Generic"), a 100%
subsidiary undertaking, in respect of both voting rights and issued
shares, which is registered in England and Wales and has an issued
share capital of 5,610 US$1 ordinary shares. The investment is
stated in the Company's books at GBP440.
Up to 31 March 2009 Generic acted as an agent for the business,
but did not enter into any transactions in its own right: its
business was included within the figures reported by the Company.
On 1 April 2009 the agency agreement was terminated and all
business is now conducted directly by the parent company including
its Generic business.
(b) Triad Special Systems Limited, Generic Online Limited, Zubed
Geospatial Limited, Zubed Sales Limited, are all 100% subsidiaries
which are registered in England and Wales. They are dormant
companies, which have never traded. Each has a share capital of
GBP1.
The registered office of Triad Special Systems is Huxley House,
Weyside Park, Catteshall Lane, Godalming, Surrey GU7 1XE. The
registered office of the other subsidiaries is 3 Caldecotte Lake
Business Park, Caldecotte Lake Drive, Caldecotte, Milton Keynes MK7
8LF.
15. Trade and other receivables
Group and company 2023 2022
GBP'000 GBP'000
Trade receivables 2,006 1,868
Less: provision for expected credit losses (5) (14)
-------------------------------------------- -------- --------
Trade receivables-net 2,001 1,854
Contract assets 225 212
Unbilled income 150 259
Other debtors - 208
-------------------------------------------- -------- --------
Trade and other receivables 2,376 2,533
Prepayments 165 151
-------------------------------------------- -------- --------
2,541 2,684
-------------------------------------------- -------- --------
Analysed as:
Non-current asset: unbilled income - 130
Current asset 2,541 2,554
-------------------------------------------- -------- --------
Total 2,541 2,684
-------------------------------------------- -------- --------
Other debtors of GBPnil (2022: GBP208k) is with respect to legal
costs recoverable and accrued interest thereon with a shareholder
who holds more than 20% of the company's issued share capital. The
fair value of trade and other receivables approximates closely to
their book value.
Unbilled income is in respect to the billing profile of a
licence agreement.
The lifetime expected credit losses on trade receivables as at
31 March 2023 is calculated as follows:
Group and company Expected default rate Gross carrying amount Credit loss allowance
(A) (B) (A x B)
% GBP'000 GBP'000
Current 0.25 1,988 5
Up to 30 days past due - 14 -
Up to 60 days past due - 2 -
Over 60 days past due 5.0 2 -
------------------------ ---------------------- ---------------------- ----------------------
2,006 5
------------------------ ---------------------- ---------------------- ----------------------
No provision has been recognised for contract assets and other
debtors as they are expected to be fully recovered.
The lifetime expected credit losses on trade receivables as at
31 March 2022 were calculated as follows:
Group and company Expected default rate Gross carrying amount Credit loss allowance
(A) (B) (A x B)
% GBP'000 GBP'000
Current 0.75 1,856 13
Up to 30 days past due 5.0 12 1
------------------------ ---------------------- ---------------------- ----------------------
1,868 14
------------------------ ---------------------- ---------------------- ----------------------
Movements on the provision for expected credit loss are as
follows:
Group and company 2023 2022
GBP'000 GBP'000
At beginning of the year 14 19
Credited to income statement (9) (5)
At end of the year (credit loss allowance) 5 14
-------------------------------------------- -------- --------
The carrying amount of the Group's trade and other receivables
are denominated in the following currencies:
Group and company 2023 2022
GBP'000 GBP'000
Sterling 2,376 2,543
Euros - (10)
------------------- -------- --------
2,376 2,533
------------------- -------- --------
16. Cash and cash equivalents
Group and company 2023 2022
GBP'000 GBP'000
Cash available on demand 4,795 5,325
-------------------------- -------- --------
The fair value of cash and cash equivalents approximates closely
to their book value.
The carrying amount of the Group's cash and cash equivalents is
denominated in the following currencies:
Group and company 2023 2022
GBP'000 GBP'000
Sterling 4,777 5,239
Euros 18 86
------------------- -------- --------
4,795 5,325
------------------- -------- --------
For the purpose of the consolidated cash flow statement, cash
and cash equivalents consist of cash, as detailed above.
The Group has access to a financing facility with a major UK
bank. At the balance sheet date in the current or prior year this
facility has not been utilised. The facility borrowing rate is
1.75% above base rate.
17. Trade and other payables
Group Company
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
Trade payables 666 667 666 667
Accruals 335 525 335 525
Owed to subsidiary - - 5 5
------------------------------------ -------- -------- -------- --------
1,001 1,192 1,006 1,197
Contract liabilities 37 116 37 116
Other taxation and social security 1,231 930 1,231 930
------------------------------------ -------- -------- -------- --------
2,269 2,238 2,274 2,243
------------------------------------ -------- -------- -------- --------
Analysed as:
Current liability 2,269 2,134 2,274 2,139
Non-current liability: accruals - 104 - 104
------------------------------------ -------- -------- -------- --------
Total 2,269 2,238 2,274 2,243
------------------------------------ -------- -------- -------- --------
The majority of trade and other payables are settled within
three months from the year end.
The fair value of trade and other payables approximates closely
to their book value.
The carrying amount of trade and other payables is denominated
in the following currencies:
Group Company
2023 2022 2023 2022
GBP'000 GBP'000 GBP'000 GBP'000
Sterling 1,001 1,192 1,006 1,197
1,001 1,192 1,006 1,197
---------- -------- -------- -------- --------
18. Provisions
Group and company Provision for property dilapidations
GBP'000
At 1 April 2022 197
Additions -
Charged to income statement -
Utilised in year -
At 31 March 2023 197
----------------------------- -------------------------------------
The maturity profile of the present value of provisions is as
follows:
Group and company 2023 2022
GBP'000 GBP'000
Current
Provision for property dilapidation - 61
Non-current
Provision for property dilapidation 197 136
------------------------------------- -------- --------
The provision for property dilapidation covers the estimated
future costs required to meet obligations under property leases to
redecorate and repair property.
19. Share capital 2023 2022
Ordinary shares of 1p each
Issued, called up and fully paid:
Number 16,582,663 16,539,579
Nominal value GBP165,827 GBP165,396
During the year 43,084 1p ordinary shares were issued as a
result of the exercise by employees of share options:
Number Option price Increase in share capital Increase in share premium
20,000 11.0p GBP200 GBP2,000
23,084 53.5p GBP231 GBP12,119
------- ------------- -------------------------- --------------------------
43,084 GBP431 GBP14,119
20. Share-based payments
At 31 March 2023, 184,916 options granted under employee share
option schemes remain outstanding:
Date option granted Number Exercise price Period options exercisable
===================== ======== =============== =======================================
18 September 2014 50,000 11.0p 18 September 2017 to 18 September 2024
===================== ======== =============== =======================================
9 March 2018 134,916 53.5p 1 April 2021 to 9 March 2028
Under the terms of the scheme, options vest after a period of
three years continued employment and are subject to the following
performance conditions:
For options granted on 9 March 2018: 100% of the shares granted
under an option will vest if the Company's share price at 31 March
2021 has increased by 30% or more from the share price as at the
date of grant. 50% of shares granted under an option will vest if
the Company's share price at 31 March 2021 has increased by 15%
from the share price as at the date of grant. Between these upper
and lower thresholds, awards vest on a straight-line basis. These
options vested on 31 March 2021.
For options granted on 18 September 2014: in at least one
financial year after the date of grant, the Company shall have
achieved a positive basic earnings per share (subject to adjustment
to exclude identified exceptional items), as reported in its
audited annual accounts. These options vested on 17 September
2017.
Options have been valued using the Black-Scholes option-pricing
model. No performance conditions were included in the fair value
calculations.
No options were granted during the year (2022: nil).
In March 2022 a number of restricted stock units (RSUs) were
granted under the new Triad Employee Share Incentive Plan, and
remain outstanding as follows:
Date award made Number Performance condition Vesting date
================= ======== ====================== ==============
30 March 2022 750,000 135.0p 30 March 2025
The Award will vest following 3 years continuous employment and
if the Board determines that the Market Value of a Share on the
third anniversary of the Award Date is equal to or greater than the
Market Value of a Share on the Award Date. The market value at the
Award Date is 135.0p.
The RSUs have been valued using the Monte Carlo pricing model.
No performance conditions were included in the fair value
calculations.
The total expense recognised in the year is GBP200,128 (2022:
GBP476).
No RSUs were granted during the year (2022: 750,000).
A reconciliation of the total share award movements over the
year to 31 March 2023 is shown below:
2023 2022
Number of options Weighted average Number of options Weighted average
exercise price exercise price
Pence Pence
Outstanding at start of
year 978,000 10.2 739,000 42.2
Granted - - 750,000 1.0
Exercised (43,084) 33.8 (511,000) 43.0
Forfeited - - - -
-------------------------- ------------------ ------------------------ ------------------ ------------------------
Outstanding at end of
year 934,916 9.4 978,000 10.2
-------------------------- ------------------ ------------------------ ------------------ ------------------------
Exercisable at end of
year 184,916 42.0 228,000 40.5
-------------------------- ------------------ ------------------------ ------------------ ------------------------
There were 43,084 share options exercised during the year. In
the reconciliation above, there are no share options and a total of
180,000 restricted stock units (RSUs) held by Directors.
Transactions with Directors are set out in the Directors'
remuneration report on page 29 .
The options exercisable of 184,916 relate to the 2014 and 2018
grants which have all vested (2022: 228,000 all vested).
The weighted average share price at the date of exercise for
share options exercised during the period was 113.5p (2022:
118.2p). The options outstanding as at 31 March 2023 had an
exercise price of 11.0p or 53.5p, and with respect to the RSUs,
135.0p. The weighted average remaining contractual life of 2.4
years (2022: 3.4 years).
The inputs into the share-based payments model to calculate the
RSU awards were as follows:
Expected volatility 77%
Expected life 3 years
Risk-free rate 1.4%
Exercise price 1p
Valuation 135p
Dividend Yield 4.4%
21. Related party transactions and ultimate control
The Group and Company rents one of its offices under a lease
with a sub-tenant in occupation on one floor. During the year, the
Group did not take advantage of a lease break and the lease now
expires in March 2028. The current annual rent of GBP215,000 was
fixed, by independent valuation, at the last rent review in 2008. J
C Rigg, a Director, has notified the Board that he has a 50%
beneficial interest in this contract. The balance owed at the
year-end was GBPnil (2022: GBPnil). There is no ultimate
controlling party.
Five year record
For the accounting period commencing 1 April 2019 changes were
made due to the introduction of IFRS 16. Therefore the accounting
policies over the period detailed below will vary and be
inconsistent.
Consolidated income statement
Years ended 31 March 2023 2022 2021 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Revenue 14,858 17,015 17,815 19,354 22,713
Gross profit 3,504 4,784 3,810 2,854 4,376
Profit/(Loss) before tax 9 1,081 644 (602) 1,017
Tax (charge)/credit (53) 88 41 (159) (132)
(Loss)/Profit after tax (44) 1,169 685 (761) 885
Retained (loss)/profit for the financial year (44) 1,169 685 (761) 885
Basic (loss)/earnings per share (pence) (0.27) 7.16 4.28 (4.76) 5.60
----------------------------------------------- -------- -------- -------- -------- --------
Balance sheet
As at 31 March 2023 2022 2021 2020 2019
GBP'000 GBP'000 GBP'000 GBP'000 GBP'000
Non-current assets 1,276 916 921 1,236 411
Current assets 7,430 7,963 7,540 6,581 7,937
Current liabilities (2,561) (2,464) (2,555) (2,399) (2,483)
Non-current liabilities (951) (397) (623) (863) (99)
----------------------------------------------- -------- -------- -------- -------- --------
Net assets 5,194 6,018 5,283 4,555 5,766
----------------------------------------------- -------- -------- -------- -------- --------
Share capital 166 165 160 160 160
Share premium account 894 880 666 660 659
Capital redemption reserve 104 104 104 104 104
Retained earnings 4,030 4,869 4,353 3,631 4,843
----------------------------------------------- -------- -------- -------- -------- --------
Equity shareholders' funds 5,194 6,018 5,283 4,555 5,766
----------------------------------------------- -------- -------- -------- -------- --------
Shareholders' information and financial calendar
Share register
EQ maintain the register of members of the Company. If you have
any questions about your personal holding of the Company's shares,
please contact:
EQ
Highdown House
Yeoman Way
Worthing
West Sussex
BN99 3HH
Telephone: 0371 384 2486
If you change your name or address or if the details on the
envelope enclosing the report, including your postcode, are
incorrect or incomplete, please notify the registrar in
writing.
Shareholders' enquiries
If you have an enquiry about the Group's business, or about
something affecting you as a shareholder (other than queries that
are dealt with by the registrar) you should contact the Company
Secretary, by letter or telephone at the Company's registered
office.
Company Secretary and registered office:
James McDonald
Triad Group Plc
Weyside Park
Catteshall Lane
Godalming
Surrey
GU7 1XE
Telephone: 01908 278450
Email: investors@triad.co.uk
Website: www.triad.co.uk
Financial calendar
Annual General Meeting The date of the AGM is to be confirmed.
Financial year ended 31 March 2024: expected announcement of results
Half-year November 2023
Full-year June 2024
Corporate information
Executive Directors
John Rigg, Chairman
Charlotte Rigg, Deputy Executive Chairman
Adrian Leer, Managing Director
Tim Eckes, Client Services Director
James McDonald, Finance Director
Non-Executive Directors
Alistair Fulton
Chris Duckworth
Alison Lander
Secretary and registered office
James McDonald
Triad Group Plc
Weyside Park
Catteshall Lane
Godalming
Surrey
GU7 1XE
Telephone: 01908 278450
Email: investors@triad.co.uk
Website: www.triad.co.uk
Country of incorporation and domicile of parent company
United Kingdom
Legal form
Public limited company
Company number
02285049
Registered Auditor
BDO LLP
55 Baker Street
London
W1U 7EU
Brokers
Zeus Capital Ltd
125 Old Broad Street
London
EC2N 1AR
Solicitors
Freeths
Davy Avenue
Knowlhill
Milton Keynes
MK5 8HJ
Bankers
Lloyds Bank plc
City Office
11-15 Monument Street
London
EC3V 9JA
Registrars
EQ
Highdown House
Yeoman Way
Worthing
West Sussex
BN99 3HH
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END
FR EALKNEFKDEFA
(END) Dow Jones Newswires
June 12, 2023 02:00 ET (06:00 GMT)
Triad (LSE:TRD)
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