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RNS
BCA Marketplace PLC  -  BCA   

Preliminary Results

Released 07:00 28-Jun-2018

RNS Number : 8270S
BCA Marketplace PLC
28 June 2018
 

28 June 2018

 


BCA Marketplace plc (LSE:BCA) - Preliminary Results for the 12 months ended 1 April 2018

Third consecutive year of strong earnings growth - uniquely positioned to provide solutions to the automotive industry

RESULTS IN BRIEF


2018

20171

Revenue

£2,431.5m

£2,029.7m

Adjusted EBITDA2

£159.5m

£135.6m

Operating profit

£87.6m

£74.3m

Net debt3

£191.6m

£260.5m

Adjusted diluted earnings per share2

11.40p

9.10p

Diluted earnings per share

7.00p

5.10p

Full year dividend (per share)

8.55p

6.75p

 

FINANCIAL HIGHLIGHTS1,2,3

·      Revenue of £2,431.5m (2017: £2,029.7m), up 19.8% as a result of organic growth, from volumes in WeBuyAnyCar and outsourced remarketing contracts, as well as the full year impact of acquisitions

·      Adjusted EBITDA of £159.5m (2017: £135.6m), up 17.6%

·      Operating profit of £87.6m (2017: £74.3m) stated after;

amortisation of acquired intangibles of £40.2m (2017: £38.5m); and

other significant and non-recurring costs of £4.8m (2017: credit of £2.4m)

·      Net debt reduced by 26.4% from £260.5m to £191.6m.

·      Diluted earnings per share of 7.0p up 37.3%. Adjusted diluted earnings per share of 11.4p, up 25.3%

·      Full year dividend of 8.55p per share up 26.7% (including a proposed 5.95p final dividend to be paid on 28 September 2018)

OPERATIONAL HIGHLIGHTS

·      Over one million vehicles sold in UK Vehicle Remarketing, up 6.5%

·      International Vehicle Remarketing volume of 362,000 units, up 4.3%

·      WeBuyAnyCar sold 219,000 units, an increase of 12.9%

·      Growth of 23.0% in International cross border sales

·      Doubt digit volume growth for the sixth consecutive year in WeBuyAnyCar driven by increased repeat customers and consumer trust in the brand

·      Automotive Services commenced operations at Southampton Port for the Renault-Nissan-Mitsubishi Alliance

·      Increased BCA Automotive delivery of UK Remarketing arranged transport - now 46% up from 26% in 2017

 

Avril Palmer-Baunack, Executive Chairman said:

 

"The Group has delivered record commercial and financial results for the third successive year. We saw increased volumes across all divisions, with UK Vehicle Remarketing achieving the landmark of selling over one million vehicles in the year.  Adjusted EBITDA increased by 17.6% to £159.5m while adjusted diluted earnings per share has increased to 11.4p, up 25.3% (compared to 9.1p in 2017).  Operating profit has increased by £13.3m to £87.6m, an increase of 17.9%, reflecting the growth in adjusted EBITDA offset by non-recurring restructuring costs relating to simplification of management structures.

The strong Group performance reflects our unique position within the Automotive solutions sector. BCA has the infrastructure, the range of digital and physical capabilities, a history of good service and innovation and we are now providing solutions at scale. These capabilities, especially the services within the more recently acquired businesses, have continued to be integrated in order to provide comprehensive customer solutions and the efficiencies that have supported the Group's growth, cash generation and dividend policy.

The new financial year has started well, with performance since the year end in line with our expectations. Across all of our markets there remains significant addressable volume to capture, where our business and consumer solutions can bring efficiency and value to new customers during the time a vehicle changes ownership. We are excited by and committed to the opportunities ahead for BCA."

About BCA Marketplace plc

BCA operates across every link of the post-factory automotive value chain, providing physical and digital solutions at scale to our customers. 

Once a new vehicle leaves its place of manufacture, we provide a comprehensive range of services including single and bulk vehicle collections and deliveries, inspection checks, customs management, storage, refurbishment, vehicle preparation, finance, pricing data and used vehicle buying. Our digital and physical auction platforms bring together OEMs, leasing companies, fleet operators, retail dealers and buyers to efficiently transfer the ownership of vehicles while protecting value.

We are a key facilitator and link to the entire value chain in automotive, whether that is the manufacturer, the dealer, the vehicle financier or the end consumer. BCA facilitates the UK and European vehicle market, enabling vehicles to be moved, bought and sold, thereby providing liquidity and choice.

For information

BCA Marketplace plc (Investor Relations)                                            

Tim Richmond                                                                               tim.richmond@bca.com

 

Buchanan (Financial PR)

David Rydell                                                                                  +44 (0) 20 7466 5000

 

Square1 Consulting (Financial PR)                                            

David Bick                                                                                      +44 (0)20 7929 5599

 

www.bcamarketplaceplc.com

Notes

 

1         Prior year comparatives include the results of the acquired businesses from their acquisition dates (Paragon 18 July 2016, the leading provider of de-fleet and refurbishment services, and Supreme Wheels 31 March 2017, an alloy wheel refurbishment business).

2         Adjusted EBITDA and adjusted diluted earnings per share are non-GAAP financial measures and are referred to within the report.  Divisional operating reviews are focused on adjusted EBITDA in order to give a more meaningful analysis, since depreciation, interest and tax are principally managed centrally on behalf of the Group and Significant or Non-recurring items ('SONR') do not directly correlate to continuing divisional operating performance. SONR includes the amortisation of acquired intangibles and other SONR items. Similarly adjusted diluted earnings per share are focused on by the Board as this measure adds back significant or non-recurring items, net of the item's taxation impact, as they do not directly correlate to continuing Group operating performance. A reconciliation of adjusted EBITDA to operating profit is provided in the Financial Performance part of the Operating and Financial Review section. The adjustments between GAAP financial measures and the non-GAAP measures are explained further in the segmental analysis and earnings per share notes (notes 3 and 4 of the condensed consolidated financial statements).

3         The Group definition of Net Debt excludes BCA Partner Finance funding and finance leases - see Cash Flow and Net Debt section within the Operating and Financial Review section of the report for further details.

4         In order to present its financial position in the most meaningful way, BCA prepares its accounts to a Sunday within seven days of 31 March, this year being the 52 weeks to 1 April 2018.



 

OPERATIONAL AND FINANCIAL REVIEW

BCA performance

The Group has delivered another year of strong profit growth, performing above market expectations with continued progress in all divisions. The result was driven by a combination of organic volume growth, increasing penetration of services, improved efficiency and the benefits of greater operational integration of the acquired businesses.

Group performance review


Year ended 1 April 2018

Year ended 2 April 2017


Revenue

Adjusted EBITDA

Other SONR

Operating profit

Revenue

Adjusted EBITDA

Other SONR

Operating profit


£m

£m

£m

£m

£m

£m

£m

£m

UK Vehicle Remarketing

941.4

98.8

(0.7)

67.1

753.8

84.0

4.8

57.8

International Vehicle Remarketing

154.3

30.1

(1.7)

12.4

135.4

26.2

0.3

11.7

Vehicle Buying

980.5

23.0

-

15.9

837.0

19.5

-

12.2

Automotive Services

355.3

21.5

(0.6)

8.0

303.5

17.2

0.7

7.4

Group costs

-

(13.9)

(1.8)

(15.8)

-

(11.3)

(3.4)

(14.8)

Total

2,431.5

159.5

(4.8)

87.6

2,029.7

135.6

2.4

74.3

 

Growth in volume drives revenue, adjusted EBITDA and operating profit

Group revenue was £2,431.5m (2017: £2,029.7m) with growth generated from all operating divisions. The significant increases in revenue arose from the sale of more vehicles acquired through the Vehicle Buying division, more vehicles sold under outsourced remarketing contracts (where the full sales value is included in revenue) in the UK Vehicle Remarketing division, and the full year impact of the Paragon acquisition along with continued organic growth of services across all divisions.

Strong volume performance in each of the divisions, increased penetration of services, and internal efficiencies, including through increased internal transport, all contributed to an adjusted EBITDA for the year of £159.5m (2017: £135.6m), an increase of 17.6%.

UK Vehicle Remarketing adjusted EBITDA grew by 17.6% driven by 6.5% growth in vehicle sold volumes, the increased penetration of BCA Partner Finance and the execution of outsourced remarketing contracts. International Vehicle Remarketing saw a 4.3% increase in volumes which, together with higher export volumes, increased penetration of transport services and a favourable exchange rate, generated a 14.9% increase in adjusted EBITDA.

Vehicle Buying adjusted EBITDA increased by 17.9% as a result of a 12.9% increase in WeBuyAnyCar volume and a slightly higher average sale value per vehicle, delivered while maintaining control of the cost base. Automotive Services adjusted EBITDA increased by 25.0% due to the increased use of the Group's own internal transport fleet and the full year impact of the Paragon and Supreme Wheels acquisitions.

Group costs of £13.9m were incurred in the year (2017: £11.3m) reflecting the continued development of the corporate capability following the move to a Premium Listing on the Official List, improved management capacity to deliver joined up solutions across the divisions for OEMs and major corporates and the share based payment IFRS 2 charge of £2.0m (2017: £1.6m).

Operating profit of £87.6m increased by £13.3m, driven by the £23.9m growth in adjusted EBITDA set out above. This was offset by an increase in amortisation of acquired intangible assets of £1.7m to £40.2m as a result of the full year impact of the Paragon acquisition and a £7.2m increase in other SONR items. The current year other SONR items included £5.5m of management restructuring costs as part of our efficiency improvement programme and £1.0m of costs related to the move to a Premium Listing, partially offset by a £1.7m profit on the sale and leaseback of site developments at Manchester and Bedford. In the prior year, other SONR items amounted to an income of £2.4m, which comprised a £5.3m profit on the sale and leaseback of the Birmingham Perry Barr site, offset by acquisition related costs of £2.9m.

Divisional financial performance

UK Vehicle Remarketing

Highlights

Year ended
1 April 2018

Year ended
2 April 2017

Change

Vehicles sold ('000)

1,018

956

+6.5%

Revenue per vehicle (£)

925

788

+17.4%

Revenue (£m)

941.4

753.8

+24.9%

Adjusted EBITDA (£m)

98.8

84.0

+17.6%

Operating profit (£m)

67.1

57.8

+16.1%

Adjusted EBITDA per vehicle (£)

97

88

+10.2%

Adjusted EBITDA margin (%)

10.5

11.1


 

In the UK BCA exceeded the milestone of one million vehicles sold in the year. The volume of vehicles sold through our UK auctions has continued to grow, up 6.5% on prior year. This was driven by strong growth in volume sourced from the Vehicle Buying division, alongside new customer wins in both the OEM and franchised and non-franchised dealer sectors, with increasing volumes from existing customers.

UK Vehicle Remarketing revenue increased by 24.9% to £941.4m, driven primarily by the growth of outsourced remarketing contract volume (where the full sales value is included within revenue) as well as growth of remarketing volume and penetration of remarketing services. Outsourced remarketing has grown as vendors are attracted to the speed, liquidity and simplicity the service provides, while allowing them to remove the costs of running what is to them a non-core operation. Penetration of auction services including valeting, BCA Assured and smart repairs continues to grow year-on-year. A greater number of customers have also incorporated additional services including the Group's Dealer Pro and AutosOnShow applications to improve control of their valuation, inventory management and imaging.

The ability for selected partners to fund part-exchange vehicles and the introduction of dedicated BCA Partner Finance branded sales programmes have contributed to an increase in the number of vehicles funded through BCA Partner Finance. Penetration has increased to 12.6% of all UK Vehicle Remarketing vehicles sold in March 2018 (March 2017: 11.3%). The resultant asset backed loan book grew to £148.4m (2017: £113.4m) reflecting the increased volume and a higher average value of the vehicles financed at the year end. BCA Partner Finance funded £841m of vehicles during the year (2017: £577m).

Adjusted EBITDA per vehicle increased by 10.2% to £97, reflecting the increased penetration of products and services, improved operational efficiency through increased volume throughput and expanded sales programmes. This was achieved despite a backdrop of legislative changes leading to higher costs of labour, business rates and insurance premium tax. Adjusted EBITDA margin in the UK of 10.5% (2017: 11.1%) is slightly lower as a result of the increased outsourced remarketing contracts, where we recognise the full vehicle sale revenue, reducing the reported margin percentage.

International Vehicle Remarketing

Highlights

Year ended
1 April 2018

Year ended
2 April 2017

Change

Vehicles sold ('000)

362

347

+4.3%

Revenue per vehicle (£)

426

390

+9.2%

Revenue (£m)

154.3

135.4

+14.0%

Adjusted EBITDA (£m)

30.1

26.2

+14.9%

Operating profit (£m)

12.4

11.7

+6.0%

Adjusted EBITDA per vehicle (£)

83

76

+9.2%

Adjusted EBITDA margin (%)

19.5

19.4


Adjusted EBITDA (£m) at constant prior year exchange rate

28.6

26.2

+9.2%

Adjusted EBITDA per vehicle (£) at constant prior year exchange rate

79

76

+3.9%

 

The International Vehicle Remarketing division increased volume to 362,000, growth of 4.3% compared to the prior year. Increased volume, service uptake and favourable exchange rates delivered revenue of £154.3m, growth of 14.0% (8.4% at constant exchange rates).

Adjusted EBITDA growth of 14.9% (9.2% at constant exchange rates), reflects the increased volume and operational gearing from the extensively online model. If measured at constant prior year exchange rates, revenue and adjusted EBITDA per unit would have been £406 and £79 (2017: £390 and £76), growth of 4.1% and 3.9% respectively. The average exchange rate for the year was €1.136:£1 compared to €1.194:£1 in the prior year.

Management continues to promote auction as a disposal channel and is building strong relationships with vendors and buyers across Europe. In the year BCA MarketPrice, the Group's European dealer-focused part-exchange valuation tool, drove growth in remarketing volumes, while helping vendors to maximise their part-exchange performance. BCA MarketPrice provided 1.2m valuations (2017: 1.1m) to a dealer base that has grown to 2,200 dealers (2017: 1,800).

The Group's geographical coverage, flexible sites and online platforms, supported by its ability to collect, inspect, store and deliver vehicles, ensures accessibility to a large number of buyers through both physical and digital auctions. This infrastructure has the capacity to allow efficient growth as demand from vendors and buyers increases across Europe and beyond. The newly created European transport brokerage operation continues to develop by sourcing and managing the efficient movement of vehicles to support the increasing volume of exports.

During the year, our operations in Europe have experienced differing underlying market conditions ranging from favourable markets driven by vehicle exports in Denmark and Sweden, stable markets in the majority of countries and more challenging market conditions in Germany and Italy. Our international portfolio of established vehicle remarketing operations allows us to sustain development in comparison to nationally focused competitors.

Vehicle Buying

The Vehicle Buying division incorporates WeBuyAnyCar in the UK and vehicle buying operations in Europe.

Highlights - UK

Year ended
1 April 2018

Year ended
2 April 2017

Change

Vehicles sold ('000)

219

194

+12.9%

Revenue per vehicle (£)

4,202

4,114

+2.1%

Revenue (£m)

920.3

798.1

+15.3%

Adjusted EBITDA (£m)

23.0

19.5

+17.9%

Operating profit (£m)

15.9

12.2

+30.3%

Adjusted EBITDA per vehicle (£)

105

101

+4.0%

Adjusted EBITDA margin (%)

2.5

2.4


 

 

Highlights - International

Year ended
1 April 2018

Year ended
2 April 2017

Change

Vehicles sold ('000)

12

7

+71.4%

Revenue (£m)

60.2

38.9

+54.8%

Adjusted EBITDA (£m)

-

-

-

Operating profit (£m)

-

-

-

 

 

WeBuyAnyCar celebrated its sixth consecutive year of double digit volume growth, an increase of 25,000 vehicles or 12.9% compared to the prior year, reinforcing our leading market position as the UK's largest buyer of vehicles. The increased volume and higher average price per vehicle drove revenue 15.3% higher to £920.3m. Rigorous inventory management and a varied auction programme across a number of the Group's vehicle remarketing centres, allow us to consistently sell WeBuyAnyCar vehicles within an average of ten days from purchase, minimising holding risks.

The business model and evolving advertising have focused on communicating and delivering an easy, trusted, convenient and secure experience to consumers. With a network of over 225 branches, WeBuyAnyCar is conveniently located, close to customers throughout the UK, and makes offers on all vehicles, regardless of mileage, age or condition. Our business model attracts a diverse range of vehicles and during the year we have purchased across the whole spectrum, from 58,000 superminis to 108 super cars including a £216,000 Rolls-Royce Wraith Coupe. The oldest car purchased was a 40 year old MG Midget 1500, and the rarest purchases included a Corvette Stingray, a Ford Dorchester, a Lamborghini Gallardo Spyder and a Pontiac Firebird.

We are proud that in the year, webuyanycar.com maintained 5 stars out of 5 in Trust-pilot ratings. We continue to focus on providing a transparent service and earning increased customer trust in the service we provide.

The increased volume of vehicles sold drove a 17.9% improvement in adjusted EBITDA to £23.0m (2017: £19.5m). The ongoing refinement of our valuation process allows margins to be tightly controlled while continuing to deliver growth in volumes.

In Europe, our vehicle buying businesses focus on purchasing batches of vehicles to remarket through the International Vehicle Remarketing division. They target opportunities to drive increased remarketing volume, raise awareness of auctions and deliver increased value or efficiency for OEMs and corporates. Revenue in International Vehicle Buying increased to £60.2m, up 54.8%. These operations enrich the variety of vehicles available to the International Vehicle Remarketing division, so are managed to cover operating costs within the Vehicle Buying division.

Automotive Services

The Automotive Services division was created to bring together the Group's new and used vehicle storage, preparation, handling, enhancement, refurbishment and transport capabilities. This integration has enabled the Group to provide a comprehensive suite of services to customers in a more connected manner.

Highlights

Year ended
1 April 2018

Year ended
2 April 2017

Change

Revenue (£m)

355.3

303.5

+17.1%

Adjusted EBITDA (£m)

21.5

17.2

+25.0%

Operating profit (£m)

8.0

7.4

+8.1%

Adjusted EBITDA margin (%)

6.1

5.7


 

Revenue growth of 17.1% was driven primarily by the full year impact of the Paragon and Supreme Wheels acquisitions.

BCA Vehicle Services won the tender as port of entry operator for the Renault-Nissan-Mitsubishi Alliance at Southampton. The anticipated slowdown in new car sales slightly suppressed profitability, while increased inspections and storage volumes were handled, and improved incentivised customer service levels were achieved.

BCA Fleet Solutions continued to drive customer service improvements and develop new relationships with rental and fleet companies, resulting in a number of new long-term contracts. Linked to these service developments, BCA Fleet Solutions is investing in state of the art technology including facilities for handling electric and hybrid vehicles. Further progress has been made in the efficiency of refurbishment of BCA's own vehicles, delivering a better quality inventory for buyers whilst protecting residual value.

During the year, BCA Logistics continued to perform well, driven by prior year improvements in operating efficiencies, increased inspect and collect volumes and vehicle movements. The inspection platform was enhanced and the majority of inspections (including branch based inspections) were migrated to the new platform, delivering improved customer service levels. The business unit completed its move to a new centralised operational headquarters located in Solihull, providing increased capacity for this growing operation.

Three years ago we performed no internal transport, but over 46% of the vehicle movements arranged by the UK Vehicle Remarketing division are now delivered internally by BCA Automotive, increasing the overall integration of the business and efficiency of transport.

Financial performance review

The following table reconciles adjusted EBITDA to statutory operating profit by division:

 


Year ended 1 April 2018


Adjusted

EBITDA

Depreciation and

 amortisation

Amortisation of acquired intangibles

Other

SONR

Operating

profit


£m

£m

£m

£m

£m

UK Vehicle Remarketing

98.8

(12.5)

(18.5)

(0.7)

67.1

International Vehicle Remarketing

30.1

(3.9)

(12.1)

(1.7)

12.4

Vehicle Buying

23.0

(1.3)

(5.8)

-

15.9

Automotive Services

21.5

(9.1)

(3.8)

(0.6)

8.0

Group costs

(13.9)

(0.1)

-

(1.8)

(15.8)

Total

159.5

(26.9)

(40.2)

(4.8)

87.6

 


Year ended 2 April 2017


Adjusted

EBITDA

Depreciation and

 amortisation

Amortisation of acquired intangibles

Other

SONR

Operating

profit


£m

£m

£m

£m

£m

UK Vehicle Remarketing

84.0

(12.5)

(18.5)

4.8

57.8

International Vehicle Remarketing

26.2

(3.3)

(11.5)

0.3

11.7

Vehicle Buying

19.5

(1.6)

(5.7)

-

12.2

Automotive Services

17.2

(7.7)

(2.8)

0.7

7.4

Group costs

(11.3)

(0.1)

-

(3.4)

(14.8)

Total

135.6

(25.2)

(38.5)

2.4

74.3

 

The divisional operating structure continues to reflect the financial information that the Group's Board, which is the chief operating decision maker, uses to make decisions about the allocation of resources, in accordance with IFRS 8, Operating Segments. Divisional operating reviews focus on adjusted EBITDA in order to give a more meaningful analysis, since depreciation, interest and tax are principally managed centrally on behalf of the Group and SONR items do not directly correlate to continuing divisional operating performance. A reconciliation of divisional adjusted EBITDA to operating profit is provided above.



Year ended
1 April 2018

Year ended

 2 April 2017



£m

£m

Operating profit


87.6

74.3

Net finance costs


(11.7)

(17.9)

Profit before income tax


75.9

56.4

Taxation


(18.9)

(15.3)

Non-controlling interest


(0.5)

(0.2)

Retained profit


56.5

40.9

 

Financing costs

The net finance costs in the year were £11.7m (2017: £17.9m). The lower net finance costs were driven by the full year impact of the February 2017 refinancing and lower amortisation of capitalised debt issue costs, partially offset by an increase in LIBOR during the year. The prior year finance costs included the non-recurring write off of £4.9m of debt issue costs in relation to the previous facility.

Taxation

The tax charge of £18.9m (2017: £15.3m) included a £9.1m net tax credit in relation to SONR items, including £8.2m relating to amortisation of acquired intangible assets. This resulted in an effective tax rate for the year of 24.9% (2017: 27.1%). Excluding the impact of the other SONR items in the year, the Group had an underlying tax rate of 23.1% (2017: 21.8%).

The effective tax rate for the year of 24.9% was higher than the standard rate of corporation tax in the UK (19.0%) as a result of permanent disallowable items, adjustments in respect of prior periods in both the UK and overseas, and the impact of higher income tax rates in Europe.

Permanently disallowable items comprise expenditure incurred that does not qualify for a tax deduction in the territory in which it arises. The increase in permanently disallowable expenditure is a result of the higher level of cost incurred in the year as well as a remeasurement of tax risk in overseas territories. Prior period adjustments relate to changes in the composition of deferred tax assets in the UK which is offset by additional income tax payable in respect of prior periods in Europe following closure of a tax audit overseas. Management expects the Group's underlying tax rate to remain in the low twenties over the short to medium-term, before the anticipated impact of the UK's future reduction in the corporation tax rate from 19.0% to 17.0% reduces the overall tax rate from 2020 onwards.

Profit after tax

Profit after tax for the year was £57.0m, which was 38.7% higher than £41.1m in the prior year. Profit after tax is stated after charging tax of £18.9m (2017: £15.3m), other SONR costs within finance costs of £nil (2017: £4.9m), amortisation of acquired intangibles of £40.2m (2017: £38.5m) and other SONR costs within operating costs of £4.8m (2017: credits of £2.4m), giving an adjusted profit before tax figure of £120.9m which is 24.1% higher than the prior year of £97.4m.

Earnings per share and dividends

Adjusted diluted earnings per share were 11.4p, up 25.3% (2017: 9.1p). Earnings per share were calculated by using adjusted earnings and the weighted average number of shares in issue for the year as shown in note 4. Statutory basic and diluted earnings were 7.2p per share and 7.0p per share (2017: 5.2p and 5.1p per share) respectively.

The Board continues to target a payout ratio of 75% of earnings as dividends. In addition to the 2.60p interim dividend per share paid in January 2018 (2017: 2.20p per share paid in January 2017), the Board is pleased to propose a final dividend of 5.95p per share (2017: 4.55p per share), subject to approval at the Annual General Meeting ('AGM') on 6 September 2018, to be paid on 28 September 2018 to shareholders on the Register on 14 September 2018.

Cash flow and net debt

During the year the Group continued to generate strong cash flow from operations of £206.2m (2017: £138.3m) and ended the year with net debt of £191.6m (2017: £260.5m). Cash conversion from adjusted EBITDA was 129.3% (2017: 102.0%). This was improved by £18.0m of auction payments which were made after the year end due to the Easter bank holiday. Cash conversion from adjusted EBITDA excluding these payments was 118.0%.

The net cash inflow from operating activities of £141.5m (2017: £64.5m) was used to fund investing and financing activities, including acquisition related payments of £13.6m. This comprised £9.6m, relating to the first of two instalments of performance related deferred consideration for Paragon (automotive service group acquired in July 2016), and £4.0m to acquire the remaining 49% of AutosOnShow. Construction of the Bedford and Manchester auction sites was completed during the year, with proceeds received from the re-finance of £20.1m. During the year, the Group paid dividends of £55.8m.

The Group definition of net debt excludes the debts relating to BCA Partner Finance and finance leases, as these are funded under separate asset-backed lending agreements.

During the second half of the year, the Group's subsidiary, BCA Vehicle Finance Limited completed the syndication and extension of the BCA Partner Finance facility, increasing the facility to £200m on comparable terms. The facility provides capacity for the continued growth and penetration of the BCA Partner Finance proposition. At the year end, £105.5m (2017: £69.0m) was drawn, and BCA Partner Finance trade receivables supported by the facility grew to £148.4m (2017: £113.4m).

Finance lease liabilities principally relating to land, buildings and transporters totalled £31.9m (2017: £30.8m).

The Group continues to operate comfortably within its banking covenant, and to have sufficient headroom for future projects.

Purchase of own shares

During the period 21 to 27 February 2018 the Company purchased 9,000,000 of its own shares at prices between 160.8p and 173.5p for a total consideration of £15.4m. These shares were held as Treasury shares and are included in reserves in the balance sheet. Following the balance sheet date, 2,245,554 Treasury shares were used in settlement of the performance based incentive scheme.

OUTLOOK & STRATEGY

The new financial year has started well, with performance since the year end in line with our expectations. Across all of our markets there remains significant addressable volume to capture, where our business and consumer solutions can bring efficiency and value to new customers during the time a vehicle changes ownership. We are excited by and committed to the opportunities ahead for BCA.

BCA's strategy is to create value for customers through both acquisitions and organic growth in the automotive sectors in the UK and Europe. We continue to work with all major market participants to develop and adapt integrated solutions to solve and meet the needs of the participants across the automotive sector, maximising value for all stakeholders.

Forward-looking statements

This document may contain forward-looking statements that may or may not prove to be accurate.  For example statements referring to growth, trends, perform well, in line with expectations are intended to be forward-looking statements. The business is not highly seasonal between the reported period and the first half. Forward-looking statements involve known and unknown risks, uncertainties and other important factors that could cause actual results to differ materially from what is expressed or implied by the statements.

CONDENSED CONSOLIDATED INCOME STATEMENT




For the

year ended

1 April 2018

For the

year ended

2 April 2017



Note

£m

£m

£m

£m

Revenue

3


2,431.5


2,029.7

Cost of sales



(1,983.4)


(1,624.5)

Gross profit



448.1


405.2

Operating costs



(360.5)


(330.9)

Operating profit

3


87.6


74.3

Finance income



0.3


0.4

Finance costs



(12.0)


(18.3)

Profit before income tax



75.9


56.4

Income tax charge

5


(18.9)


(15.3)

Profit for the year



57.0


41.1








Attributable to:






Equity owners of the Parent



56.5


40.9

Non-controlling interests



0.5


0.2





57.0


41.1

Earnings per share from continuing operations attributable to

the equity holders of the Parent during the year







Basic earnings per share (pence)

4


7.2


5.2

Diluted earnings per share (pence)

4


7.0


5.1








Operating profit:


87.6


74.3









Add:

Depreciation and amortisation


26.9


25.2



Amortisation of acquired intangibles

3

40.2


38.5



Restructuring costs

3

5.5


-



Profit on sale and leaseback

3

(1.7)


(5.3)



Premium Listing costs

3

1.0


-



Acquisition related items

3

-


2.9









Adjusted EBITDA


159.5


135.6








Less:

Depreciation and amortisation


(26.9)


(25.2)



Net finance costs


(11.7)


(17.9)


Add:

Arrangement fees write-off


-


4.9








Adjusted profit before income tax


120.9


97.4






Adjusted earnings per share from continuing operations attributable to

the equity holders of the Parent during the year







Adjusted basic earnings per share (pence)

4


11.8


9.2

Adjusted diluted earnings per share (pence)

4


11.4


9.1

 

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME



For the

year ended

1 April 2018

For the

year ended

2 April 2017



£m

£m

Profit for the year

57.0

41.1

Other comprehensive income:



Items that will not be reclassified to the income statement




Remeasurements on defined benefit schemes, including deferred tax

6.8

(7.9)


Deferred tax on net movements in share based payments

0.5

0.1

Items that may be subsequently reclassified to the income statement




Foreign exchange translation

8.1

22.4

Total other comprehensive income, net of tax

15.4

14.6

Total comprehensive income for the year

72.4

55.7





Attributable to:



Equity owners of the Parent

71.9

55.5

Non-controlling interests

0.5

0.2



72.4

55.7

 

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY




Attributable to equity owners of the Parent






Share capital

Treasury reserve

Merger reserve

Foreign exchange reserve

Retained profit

Total

Non- controlling interests



Note

£m

£m

£m

£m

£m

£m

£m

£m

Balance at 3 April 2016


7.8

-

103.6

29.0

1,007.4

1,147.8

(0.2)

1,147.6

Total comprehensive income for the year











Profit for the year


-

-

-

-

40.9

40.9

0.2

41.1


Other comprehensive income


-

-

-

22.4

(7.8)

14.6

-

14.6

Total comprehensive income for the year


-

-

-

22.4

33.1

55.5

0.2

55.7

Contributions and distributions











Share based payments


-

-

-

-

1.6

1.6

-

1.6


Dividends paid

7

-

-

-

-

(48.4)

(48.4)

-

(48.4)

Changes in ownership interests











Acquisition of subsidiary with non-controlling interest


-

-

-

-

(0.6)

(0.6)

0.2

(0.4)

Total transactions with owners


-

-

-

-

(47.4)

(47.4)

0.2

(47.2)

Balance at 2 April 2017


7.8

-

103.6

51.4

993.1

1,155.9

0.2

1,156.1

Total comprehensive income for the year











Profit for the year


-

-

-

-

56.5

56.5

0.5

57.0


Other comprehensive income


-

-

-

8.1

7.3

15.4

-

15.4

Total comprehensive income for the year


-

-

-

8.1

63.8

71.9

0.5

72.4

Contributions and distributions











Share based payments


-

-

-

-

2.0

2.0

-

2.0


Shares issued


0.2

-

-

-

(0.2)

-

-

-


Dividends paid

7

-

-

-

-

(55.8)

(55.8)

-

(55.8)


Purchase of own shares


-

(15.4)

-

-

-

(15.4)

-

(15.4)

Changes in ownership interests











Acquisition of subsidiary removing non-controlling interest


-

-

-

-

(2.0)

(2.0)

(0.6)

(2.6)

Total transactions with owners


0.2

(15.4)

-

-

(56.0)

(71.2)

(0.6)

(71.8)

Balance at 1 April 2018


8.0

(15.4)

103.6

59.5

1,000.9

1,156.6

0.1

1,156.7

 

CONDENSED CONSOLIDATED BALANCE SHEET



As at

1 April 2018

As at

2 April 2017


Note

£m

£m

Non-current assets




Intangible assets


1,528.6

1,559.5

Property, plant and equipment


131.4

133.3

Deferred tax assets


12.0

11.8

Total non-current assets


1,672.0

1,704.6





Current assets




Inventories


59.1

58.3

Trade and other receivables


389.7

337.1

Cash and cash equivalents


135.3

84.4

Total current assets


584.1

479.8

Total assets


2,256.1

2,184.4





Non-current liabilities




Bank borrowings

6

(256.9)

(254.9)

Trade and other payables


(89.5)

(101.9)

Net pension deficit


(9.7)

(17.3)

Provisions


(16.7)

(17.7)

Deferred tax liabilities


(106.2)

(113.3)

Total non-current liabilities


(479.0)

(505.1)





Current liabilities




Bank borrowings

6

(70.0)

(90.0)

Partner Finance borrowings

6

(105.5)

(69.0)

Trade and other payables


(432.7)

(358.5)

Current tax


(10.9)

(4.5)

Provisions


(1.3)

(1.2)

Total current liabilities


(620.4)

(523.2)

Total liabilities


(1,099.4)

(1,028.3)

Net assets


1,156.7

1,156.1





Equity shareholders' funds




Share capital


8.0

7.8

Treasury reserve


(15.4)

-

Merger reserve


103.6

103.6

Foreign exchange reserve


59.5

51.4

Retained profit


1,000.9

993.1

Equity shareholders' funds


1,156.6

1,155.9

Non-controlling interests


0.1

0.2

Total shareholders' funds


1,156.7

1,156.1

 

CONDENSED CONSOLIDATED CASH FLOW STATEMENT



For the

year ended

1 April 2018

For the

year ended

2 April 2017


Note

£m

£m

Cash flows from operating activities




Profit for the year


57.0

41.1

Adjustments for:





Income tax charge

5

18.9

15.3


Net finance costs


11.7

17.9


Depreciation and amortisation

3

67.1

63.7


Profit on sale of property, plant and equipment


(1.9)

(4.5)


Loss on sale of intangibles


0.3

0.7


Equity-settled share based payments


2.0

1.6


Retirement benefit obligations


-

(0.2)


Significant or non-recurring items


-

2.1

Changes in working capital:





Inventories


(0.8)

(36.8)


Trade and other receivables


(19.4)

(46.4)


Trade and other payables


72.7

84.9


Provisions


(1.4)

(1.1)

Cash generated from operations


206.2

138.3

Increase in Partner Finance loan book


(35.0)

(48.7)

Net interest paid


(8.3)

(8.8)

Income tax paid


(21.4)

(13.3)

Net cash inflow from operating activities before acquisition related cash flows


141.5

67.5

Acquisition related cash flows


-

(3.0)

Net cash inflow from operating activities


141.5

64.5





Cash flows from investing activities




Purchase of property, plant and equipment


(51.8)

(53.8)

Purchase of intangible assets


(11.0)

(10.9)

Proceeds from sale of property, plant and equipment


40.1

36.6

Acquisition of subsidiary undertakings, net of cash acquired


(13.6)

(99.6)

Net cash outflow from investing activities


(36.3)

(127.7)





Cash flows from financing activities




Purchase of own shares


(15.4)

-

Dividends paid

7

(55.8)

(48.4)

Proceeds from borrowings


85.0

400.0

Repayments of borrowings


(105.0)

(335.0)

Financing fees paid


-

(2.9)

Proceeds from sale and leaseback of finance leases


6.9

5.8

Payment of finance lease liabilities


(7.1)

(6.0)

Increase in Partner Finance borrowings

6

36.5

28.8

Net cash (outflow)/inflow from financing activities


(54.9)

42.3





Net increase/(decrease) in cash and cash equivalents


50.3

(20.9)

Foreign exchange on cash held


0.6

2.9

Cash and cash equivalents brought forward


84.4

102.4

Cash and cash equivalents at year end


135.3

84.4

 

Net debt reconciliation



For the

year ended

1 April 2018

For the

year ended

2 April 2017


Note

£m

£m

Cash and cash equivalents at year end


135.3

84.4

Bank borrowings

6

(326.9)

(344.9)

Net debt


(191.6)

(260.5)

 



For the

year ended

1 April 2018

For the

year ended

2 April 2017



£m

£m

Net debt at start of year


(260.5)

(170.7)

Cash generated from operations


206.2

135.3

Movement in Partner Finance loan book and borrowings


1.5

(19.9)

Net interest paid


(8.3)

(8.8)

Income tax paid


(21.4)

(13.3)

Net capital expenditure


(15.8)

(22.3)

Dividends paid


(55.8)

(48.4)

Acquisitions


(13.6)

(99.6)

Purchase of own shares


(15.4)

-

Payment of finance lease liabilities


(7.1)

(6.0)

Foreign exchange and non-cash items


(1.4)

(3.9)

Financing fees paid


-

(2.9)

Net debt at year end


(191.6)

(260.5)

 



 

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1.     GENERAL INFORMATION

BCA Marketplace plc ('BCA', 'the Group' or the 'Company'), was incorporated in April 2014; its aim was to acquire and manage companies in the UK and European automotive sector. On 2 April 2015, BCA Marketplace plc acquired the BCA Group ('BCA Group'). This was followed by the acquisitions of SMA Vehicle Remarketing Limited ('SMA') on 1 June 2015, Stobart Automotive Limited ('BCA Automotive') on 25 August 2015, Ambrosetti (U.K.) Limited ('Ambrosetti') on 4 February 2016, Paragon Automotive Limited ('Paragon') on 18 July 2016 and Supreme Wheels Direct Ltd ('Supreme Wheels') on 31 March 2017. On 21 December 2017 the shares owned by the non-controlling interest in Life on Show Limited were acquired.

The Company is a public limited company, listed on the London Stock Exchange and incorporated and domiciled in the UK with the registered number 09019615. The address of the Company's registered office is Haversham House, Coronation Business Park, Kiln Road, Kempston Hardwick, Bedford MK43 9PR.

 

2.     BASIS OF PREPARATION

The condensed consolidated financial statements set out above do not constitute the Company's statutory accounts for the year ended 1 April 2018 or the year ended 2 April 2017 but are derived from those accounts. Statutory accounts for the year ended 2 April 2017 have been delivered to the Registrar of Companies, and those for the year ended 1 April 2018 will be delivered in due course.  The auditor has reported on those accounts; their reports were (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

The condensed consolidated financial statements for the year ended 1 April 2018 have been prepared in accordance with International Financial Reporting Standards ('IFRS') and IFRS Interpretations Committee ('IFRS IC') interpretations as adopted by the European Union ('Adopted IFRS') and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets and financial liabilities (including derivatives) at fair value through profit or loss.

The same accounting policies, presentation and methods of computation have been applied in these financial statements as were applied in the consolidated financial statements for the Group as at and for the year ended 2 April 2017. In determining and applying accounting policies, judgement is often required in respect of items where the choice of specific policy, accounting estimate or assumption to be followed could materially affect the reported results or net asset position of the Group; it may later be determined that a different choice would have been more appropriate. The Group's significant accounting policies which require the most use of management's judgement are: liability provisioning, impairment, taxation and business combinations. There has been no change in the methodology of applying management estimation in these policies since the year ended 2 April 2017.

The financial statements and the notes to the financial statements are presented in millions of pounds Sterling ('£m') except where otherwise indicated.  

Going concern

The Group maintains a mixture of medium-term debt, committed credit facilities, finance lease arrangements and cash reserves, which together are designed to ensure that the Group has sufficient available funds to finance its operations. The Board reviews forecasts of the Group's liquidity requirements based on a range of scenarios to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its committed borrowing facilities at all times, so that the Group does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities.

After making appropriate enquiries and having considered the business activities and the Group's principal risks and uncertainties, the Directors are satisfied that the Company and the Group as a whole have adequate resources to continue in operational existence for the foreseeable future. The principal risk and uncertainties that the Group is exposed to will be disclosed in the Group's 2018 annual report. The Directors believe that the Group is well placed to manage its business risk appropriately. Accordingly, the consolidated financial statements have been prepared on a going concern basis.

Basis of consolidation

Subsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

Losses applicable to non-controlling interests are allocated to the non-controlling interests even if doing so causes the non-controlling interests to have a deficit balance.

Intragroup balances, and any gains and losses or income and expenses arising from intragroup transactions, are eliminated in preparing the consolidated financial statements. Gains arising from transactions with jointly controlled entities are eliminated to the extent of the Group's interest in the entity. Losses are eliminated in the same way as gains, but only to the extent that there is no evidence of impairment.

 

3.      SEGMENTAL REPORTING

Key Performance Indicator - adjusted EBITDA

Management uses an adjusted profit measure to monitor the ongoing profitability of the Group, which is defined as Earnings before interest, taxation, depreciation and amortisation ('EBITDA') adjusted for significant or non-recurring items ('SONR'). The significant or non-recurring items that are excluded from EBITDA to calculate adjusted EBITDA are as follows:

·      acquisition expenses and gains and losses on business combinations, disposals and changes in ownership;

·      income and expenses that are significant or non-recurring or non-trading in nature, including business closure costs, restructuring costs and onerous lease provisions;

·      impairment charges and accelerated depreciation and amortisation on property, plant and equipment, intangibles and goodwill;

·      amortisation of intangible assets arising on acquisition of businesses.

 

The Directors primarily use the adjusted EBITDA measure when making decisions about the Group's activities as it is the most reliable and relevant profit measure across all segments. As this is a non-GAAP measure, adjusted EBITDA measures used by other entities may not be calculated in the same way and hence are not directly comparable.

Management has determined the operating segments based on the operating reports reviewed by the Board of Directors that are used both to assess performance and make strategic decisions.  Management has identified that the Board of Directors is the chief operating decision maker in accordance with the requirements of IFRS 8 Operating Segments.

The Board of Directors consider the business to be split into the four main revenue-generating divisions: UK Vehicle Remarketing, International Vehicle Remarketing, Vehicle Buying and Automotive Services. Group costs comprise central head office functions and any costs not directly attributable to the segments.

Information on segment assets and liabilities is not regularly reported to the Board of Directors and is therefore not disclosed.

 


For the year ended 1 April 2018


Vehicle Remarketing

Vehicle

Automotive

Group



UK

International

Buying 

Services 

Costs

Total


£m

£m

£m

£m

£m

£m

Revenue







Total revenue

946.2

156.2

980.5

386.2

-

2,469.1

Inter-segment revenue

(4.8)

(1.9)

-

(30.9)

-

(37.6)

Total revenue from external customers

941.4

154.3

980.5

355.3

-

2,431.5








Adjusted EBITDA

98.8

30.1

23.0

21.5

(13.9)

159.5

Depreciation and amortisation

(12.5)

(3.9)

(1.3)

(9.1)

(0.1)

(26.9)


86.3

26.2

21.7

12.4

(14.0)

132.6








Amortisation of acquired intangibles

(18.5)

(12.1)

(5.8)

(3.8)

-

(40.2)

Profit on sale and leaseback

1.7

-

-

-

-

1.7

Restructuring costs

(2.4)

(1.7)

-

(0.6)

(0.8)

(5.5)

Premium Listing costs

-

-

-

-

(1.0)

(1.0)

Operating profit

67.1

12.4

15.9

8.0

(15.8)

87.6

Finance income






0.3

Finance cost






(12.0)

Profit before taxation






75.9








Capital expenditure

20.8

8.6

1.6

38.7

-

69.7








Capital expenditure includes the purchase of property and transporters that were subject to a sale and leaseback. Excluding these assets, underlying capital expenditure is £30.6m.

 


For the year ended 2 April 2017


Vehicle Remarketing

Vehicle

Automotive

Group



UK

International

Buying 

Services 

Costs

Total


£m

£m

£m

£m

£m

£m

Revenue







Total revenue

756.7

136.3

837.4

321.2

-

2,051.6

Inter-segment revenue

(2.9)

(0.9)

(0.4)

(17.7)

-

(21.9)

Total revenue from external customers

753.8

135.4

837.0

303.5

-

2,029.7








Adjusted EBITDA

84.0

26.2

19.5

17.2

(11.3)

135.6

Depreciation and amortisation

(12.5)

(3.3)

(1.6)

(7.7)

(0.1)

(25.2)


71.5

22.9

17.9

9.5

(11.4)

110.4








Amortisation of acquired intangibles

(18.5)

(11.5)

(5.7)

(2.8)

-

(38.5)

Acquisition related items

(0.5)

0.3

-

0.7

(3.4)

(2.9)

Profit on sale and leaseback

5.3

-

-

-

-

5.3

Operating profit

57.8

11.7

12.2

7.4

(14.8)

74.3

Finance income






0.4

Finance cost






(18.3)

Profit before taxation






56.4








Capital expenditure

30.1

2.9

1.1

36.4

-








Capital expenditure includes the purchase of property and transporters that were subject to a sale and leaseback. In the year there was also a one-off purchase of land. Excluding these assets, underlying capital expenditure is £27.6m.

Revenue with external customers in the UK and Ireland represents £2.2bn (year ended 2 April 2017: £1.8bn) of the Group's revenue, with the other £0.2bn (year ended 2 April 2017: £0.2bn) being generated within Europe. Revenue by type is shown below:



For the

year ended

1 April 2018

£m

For the

year ended

2 April 2017

£m





Sale of goods


1,633.4

1,284.0

Rendering of services


781.9

734.0

Interest


16.2

11.7

Total revenue


2,431.5

2,029.7





 

4.     EARNINGS PER SHARE

Basic earnings per share amounts are calculated by dividing net profit for the year attributable to ordinary shareholders by the weighted average number of Ordinary shares outstanding during the year.

Diluted earnings per share is calculated by adjusting the basic earnings per share to take account of the effect of employee share schemes.


For the

year ended

1 April 2018

£m

For the

year ended

2 April 2017

£m




Profit for the year attributable to equity shareholders

56.5

40.9





m

m

Weighted average number of shares used in calculating basic earnings per share

786.2

780.2

Weighted average incremental shares in respect of employee share schemes

21.4

16.5

Weighted average number of shares used in calculating diluted earnings per share

807.6

796.7




Basic earnings per share (pence)

7.2

5.2

Diluted earnings per share (pence)

7.0

5.1

 

Key Performance Indicator - adjusted earnings per share

Adjusted earnings per share is presented in addition to the disclosures required by IAS 33, Earnings per Share, to align the adjusted earnings measure with the performance measure reviewed by the Directors. The Directors consider that this gives a more appropriate indication of underlying performance. Adjusted earnings per share amounts are calculated by dividing net profit for the period attributable to ordinary shareholders, adjusted for significant or non-recurring items and their associated tax impact, by the weighted average number of Ordinary shares outstanding during the period.

 



For the

year ended

1 April 2018

For the

year ended

2 April 2017



£m

£m

Profit for the year attributable to equity shareholders


56.5

40.9

Add back:




Significant or non-recurring items


45.0

41.0

Tax credit on significant or non-recurring items


(9.1)

(9.7)

Adjusted earnings


92.4

72.2







m

m

Weighted average number of shares used in calculating basic earnings per share


786.2

780.2

Weighted average incremental shares in respect of employee share schemes


21.4

16.5

Weighted average number of shares used in calculating diluted earnings per share


807.6

796.7





Adjusted basic earnings per share (pence)


11.8

9.2

Adjusted diluted earnings per share (pence)


11.4

9.1

 

5.     TAXATION



For the

year ended

1 April 2018

For the

year ended

2 April 2017

Current taxation


£m

£m

Current tax on profit for the year


25.4

18.7

Adjustments in respect of prior periods


2.4

(0.1)

Total current tax charge


27.8

18.6





Deferred taxation




Origination and reversal of temporary differences


(7.8)

(5.7)

Adjustments in respect of prior periods


(1.3)

2.7

Changes in recognition of deferred tax


0.2

2.4

Impact of change of UK tax rate


-

(2.7)

Total deferred tax credit


(8.9)

(3.3)





Income tax charge


18.9

15.3

 

Critical accounting estimates - taxation

Accruals for current tax and amounts payable under local indirect taxes such as sales taxes and VAT are based on management's interpretation of country specific tax law, and require judgements about the likelihood that tax positions taken will be sustained. Management estimates the amount of taxes payable based upon their analysis and determines whether provision should be made for potential settlement of disputed positions which are under negotiation. Any estimated exposure to interest on tax liabilities is provided for in the related tax amount.

 

Current tax

The tax charge for the year differs from the standard rate of corporation tax in the UK of 19.0% (year ended 2 April 2017: 20.0%). The differences are explained below:  


For the

year ended

1 April 2018

For the

year ended

2 April 2017


£m

£m




Profit on ordinary activities before tax

75.9

56.4

Profit on ordinary activities multiplied by the rate of corporation tax in the UK of 19.0% (2017: 20.0%)

14.4

11.3




Effects of:



Expenses not deductible for tax purposes

2.5

1.3

Income not subject to tax

(0.3)

(0.4)

Reduction in UK tax rate

-

(2.7)

Changes in recognition of deferred tax

0.2

2.4

Effect of different tax rates on profits earned outside the UK

1.0

0.8

Adjustments in respect of prior periods

1.1

2.6

Total taxation charge

18.9

15.3

 

The Group has operations across Europe, however, the principal location of trading where the majority of business profits are derived is the UK. The effective tax rate has therefore been referenced to the UK corporation tax rate of 19.0% for the year.

Effective tax rate

The effective tax rate for the year of 24.9% is higher than the standard rate of corporation tax in the UK as a result of higher income tax rates in Europe, prior year adjustments in the UK and Europe on both current and deferred tax balances, and the impact of permanently disallowable items and provisions charged in the year.

Permanently disallowable items comprise expenditure incurred which does not qualify for a tax deduction in the territory in which it arises. Prior period adjustments relate to changes in the composition of deferred tax assets in the UK which is offset by additional income tax payable in respect of prior periods in Europe.

Excluding the impact of the significant and non-recurring items in the year, the Group has a tax rate of 23.1%. This is in line with the 22.9% effective tax rate estimated in the Interim report for the six months ended 1 October 2017. The Group is routinely subject to audit by tax authorities in the territories in which it operates. Where points are investigated the Group considers each issue on its merits and, where appropriate, holds provisions in respect of the potential tax liability which may arise.

 

6.     BANK BORROWINGS AND PARTNER FINANCE BORROWINGS


As at

1 April 2018

As at

2 April 2017


£m

£m

Non-current



Bank borrowings

256.9

254.9

Current



Bank borrowings

70.0

90.0

 

The Group has a £500m multi-currency facility, comprising a £250m revolving facility and a £250m term loan. As at 1 April 2018 the term loan has been drawn down in full (2017: £250.0m), and £70m of the revolving facility has been drawn down (2017: £90.0m).  The facility will run until February 2021 with an option for a further 12 months by mutual consent, with no repayment of capital due before that time. 


As at

1 April 2018

As at

2 April 2017


£m

£m

Partner Finance borrowings

105.5

69.0

 

The Group has an asset-backed finance facility to fund the Partner Finance business. During the year, Partner Finance completed the syndication and extension of the BCA Partner Finance facility, increasing the facility to £200.0m on comparable terms. The amount is advanced solely to a Partner Finance subsidiary in respect of specific receivables. Interest is charged on the drawn down element of the facility at a variable rate of interest, based on the Bank of England base rate.

7.     DIVIDENDS

Financial year

Approved by

Description

Dividend pence per share

Register date

Payment date

Total

£m

2019

AGM on 6 September 2018*

2018 Final

5.95

14-Sep-18

 

28-Sep-18

47.5

Dividend proposed





47.5

2018

Board meeting on 23 November 2017

2018 Interim

2.60

15-Dec-17

31-Jan-18

20.3

AGM on 7 September 2017

2017 Final

4.55

15-Sep-17

29-Sep-17

35.5

Total dividends paid





55.8

2017

Board meeting on 24 November 2016

2017 Interim

2.20

16-Dec-16

31-Jan-17

17.2

AGM on 8 September 2016

2016 Final

4.00

23-Sep-16

30-Sep-16

31.2

Total dividends paid





48.4

2016

Board meeting on 26 November 2015

2016 Interim

2.00

11-Dec-15

18-Dec-15

15.6

Total dividends paid





15.6

*This dividend has been proposed by the Directors subject to approval by the Shareholders at the AGM

 

An interim dividend of £20.3m, 2.60p per share (2017: £17.2m, 2.20p per share), was paid on 31 January 2018 to shareholders on the Register on 15 December 2017.

The 2018 final dividend, payable during the year ended 31 March 2019, has been proposed by the Directors and is subject to approval by the shareholders at the AGM. All dividends to date were settled in cash. The total dividend is subject to the number of shares in issue on 14 September 2018.

 

8.     RELATED PARTY TRANSACTIONS

Remuneration of the Directors, who constitute the key management personnel of the Group, has been disclosed in the Remuneration Committee report in the Annual Report and Accounts 2018. Payments to Marwyn Capital LLP of £0.2m in the year (for the year ended 2 April 2017: £0.7m) relate to corporate finance advisory fees, ongoing administrative and office services and acquisition fees in the prior year. There was no balance owing as at 1 April 2018 and 2 April 2017.

The Group has not made any provision for bad or doubtful debts in respect of related party debtors, nor has any guarantee been given during the year regarding related party transactions.

 

9.     EVENTS AFTER THE REPORTING PERIOD

After the balance sheet date, deferred consideration in respect of the Paragon acquisition, an automotive services business, was paid.

On 18 April 2018, 2,245,554 Ordinary shares of £0.01 each held as Treasury shares were transferred from the Treasury reserve for the purposes of employees' share scheme allotments. No further awards remain outstanding under the Group's long-term incentive scheme. Following the transfer, issued capital consists of 804,256,263 Ordinary shares of £0.01 each of which 6,754,446 Ordinary shares of £0.01 each are held in Treasury.

 

 


 

For more information

bcamarketplaceplc.com

 

BCA Marketplace plc

Haversham House

Coronation Business Park

Kiln Road

Kempston Hardwick

Bedford

MK43 9PR

Registered in England & Wales No. 09019615

 

© BCA Marketplace plc


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Preliminary Results - RNS