Regulatory Story
Go to market news section View chart   Print
RNS
Best of the Best PLC   -  BOTB   

Final Results

Released 07:00 20-Jun-2019

RNS Number : 8221C
Best of the Best PLC
20 June 2019
 

BEST OF THE BEST PLC

Preliminary Results

For the year ended 30 April 2019

 

 

 

KEY HIGHLIGHTS: 

·      Revenue increased by 14.4% to £14.81 million (2018: £12.95 million)

·      Online sales during the period accounted for £14.3 million of revenue or circa 97% of the total

·      Operating profit before exceptional items increased by 31.9% to £2.11 million (2018: £1.60 million)

·      Net assets of £1.28 million, underpinned by cash balances of £2.54 million

·      Proposed 2.0p ordinary dividend to be paid on 27 September 2019

·      Tender offer completed in February 2019 returned £3.5m to qualifying shareholders following successful conclusion of a VAT claim

·      Adjusted earnings per share increased by 32.3% to 17.62p (2018: 13.32p)

·      Continued success with marketing initiatives, resulting in an encouraging increase in online sales

·      Revenues now almost exclusively online, with just one airport location remaining

·      Competitions, pricing and strategy now designed for our growing online customer base, enabling increased marketing investment in player acquisition and retention

 

 

William Hindmarch, Chief Executive, said:

"I am pleased to report continued solid progress with an encouraging set of final results showing both increased revenues and profits before tax, both of which are slightly ahead of management's expectations.  The transformation to become a pure online business is largely complete and has been a success, giving us more flexibility and focus, as well as efficiency and cost savings.  

 

We continue to increase our marketing investment across all acquisition and retention channels and look forward to updating shareholders with further progress in due course."

 

 

Enquiries:

 

Best of the Best plc

William Hindmarch, Chief Executive

Rupert Garton, Commercial Director

T: 020 7371 8866

 

 

 

KTZ  Communications

Katie Tzouliadis

T: 020 3178 6378

 

 

 

finnCap

(Nominated Adviser and Broker)

Corporate Finance

Carl Holmes

Anthony Adams

ECM

Alice Lane

 

T: 020 7220 0500

 

The information communicated in this announcement is inside information for the purposes of Article 7 of Regulation 596/2014.  Please visit www.botb.com for further information
 

 

 

CHIEF EXECUTIVE'S STATEMENT

During the year we have almost completed our move away from physical retail locations (principally airports) to become, in due course, an entirely online focused operation. With the exception of one remaining site at Birmingham Airport, all customer acquisition activity is focused on driving traffic and registrations to our website botb.com

 

The transformation to become a pure online business has been a proven success, giving us more flexibility and focus, as well as material efficiency and cost savings.  Our investment in marketing continues to increase and has been returning encouraging results. As a result, our competitions, pricing and product strategy are now tailored exclusively for our growing and increasingly diversified online customer base.

 

Preliminary Results

Revenue for the year ended 30 April 2019 increased by 14.4% to £14.81 million (2018: £12.95 million) and operating profit before exceptional items rose by 31.9% to £2.11 million (2018: £1.60 million).  Adjusted earnings per share (excluding exceptional items and associated tax) increased by 32.3% to 17.62p (2018: 13.32p).

 

£4.5 million of exceptional income was also recognised as a result of the Company's successful claim for overpaid VAT in prior years, offset by £2.0 million of exceptional expenses related to retrospective taxation and professional fees.  This finally concludes the already well documented VAT claim which has been ongoing since 2013 and the Directors are pleased this has come to a conclusion.  Profit before tax including exceptional items was £4.70 million with fully diluted earnings per share (including exceptional items) from continuing operations at 38.52p.  Following the conclusion of the VAT claim a tender offer was completed in February 2019 to return £3.5m to qualifying shareholders.

 

A total of £4.24 million of cash flow was generated from operations during the period (2018: £1.81 million).  Net assets at 30 April 2019 stood at £1.28 million (2018: £1.55 million), underpinned by cash balances of £2.54 million (2018: £2.32 million) and our 967-year leasehold office properties valued at £0.95 million.  Current cash balances stand in excess of £3.0 million.

 

The Company is now deriving almost all of its income from our higher margin online operations. During the year we exited our two Gatwick Airport sites as well as our sites at both Edinburgh and Manchester airports.  Our only remaining physical site is at Birmingham airport.  Although these closures (we previously occupied up to 12 airport sites and several shopping centre sites) have held back the top line revenue growth in the last few years, the business is now much better placed to grow profitably and efficiently.  Online sales grew strongly during the period, accounting for £14.3 million of revenue or circa 97% of the total.

 

Dividends

The Board is recommending a final dividend of 2.0p per share (2018: 1.5p) for the full year ending 30 April 2019 subject to shareholder approval at the Annual General Meeting on 11 September 2019.  The final dividend will be paid on 27 September 2019 to shareholders on the register on 13 September 2019.  A Special Dividend of 4.5p per ordinary share was also paid to shareholders on 20 July 2018.

 

Strategy, competitions and pricing

Since inception in 2000, BOTB leased physical sites in locations such as airports and shopping centres to acquire new players, service existing players and encourage customers to play online. However, our costs and in particular rent and staff expenditure in these retail locations continued to increase significantly year-on-year, resulting in reduced efficiency when compared to other available channels.

 

Through continued trials in previous years, the Company proved it could execute its marketing strategy more effectively using predominantly digital media complemented by traditional advertising channels.  The physically serviced airport and retail customers were also disproportionately affecting our pricing strategy and our ability to innovate online. A further positive consequence of the move to becoming a purely online operator has therefore been our ability to design our competitions, pricing and innovations exclusively for the online player.

 

BOTB's principal competition is the Weekly Dream Car, which continues to perform well and benefit from improvements to the online user experience, pricing and the choice of cars. Together, these incremental changes have had a positive effect on revenues. Our online content and weekly "In the Headlights" edit section provides an incentive for people to keep returning to the site and maintains engagement.    

The Lifestyle Competition which features luxury watches, motorbikes, holidays and other gadgets/technology as well as cash prizes also continues to perform encouragingly. There is a substantial overlap with players of our Dream Car competitions, but the range of prizes in the Lifestyle Competition has significantly broadened our addressable market for this affordable offering.

 

Continued investment in IT development

With the focus now exclusively online, our ability to acquire players and encourage their loyalty - whether playing for the car they have always dreamt about or for the lifestyle prize they really want but cannot justify buying - relies heavily on providing the best possible user experience and seamless checkout on whatever screen or device a customer is viewing.

 

Over half our revenues and circa 80% of our visits are now on mobile (and tablet) devices.  Whilst a new platform and responsive website was deployed in early 2017, we believe there are significant further opportunities to enhance the mobile experience for our customers and to improve conversion rates for both new and existing players.

 

Our two-weekly development and release cycle is continually refining our technology and introducing new functionality to make using botb.com simpler, easier and more accessible for everyone.  Improvements to server responsiveness, reporting, device UX analysis specifically for mobile, purchase path streamlining and improved payment integration are planned for the current year.  We will also be re-introducing android and iOS apps, to complement an improved mobile website experience. 

 

New player acquisition and CRM

We have continued to invest strongly to attract new customers and during the year BOTB's marketing strategy has delivered encouraging online revenue growth.  An enlarged, predominantly in-house marketing team has invested in a multitude of channels across the spectrum, including Social Media, TV, Radio, PR and YouTube Influencers to acquire new players.  These players replace those once acquired through our many physical face-to-face channels and, because they were acquired online, respond well to our content, marketing initiatives and to the wider BOTB community.

 

Social media continues to be a core marketing channel, driving both customer acquisition and brand awareness. Our Facebook page now attracts over 249,000 followers with BOTB's YouTube channel at over 31,000 subscribers, whilst Instagram followers exceed 80,000.

 

This activity is complemented by campaigns executed on traditional media channels to ensure the Company is promoted to a wide range of ages and demographics. New updated TV creative was run throughout the period and performed at its most efficient level since we first utilised TV advertising in 2015. Investment in print and public relations has secured frequent coverage of weekly winners and is working well to positively support and promote our brand.

 

Our key business metric is the cost per acquisition of new customers, versus their lifetime value. This metric, which is tracked and analysed in considerable detail across the channels, is the primary driver in dictating where and how we continue to grow our online marketing investment in the year ahead, to acquire new BOTB customers and advocates.

 

A further focus in this financial year will be on maximising customer retention and engagement and hence lifetime values.  A new hire has been made specifically to assist with this project, including a full review of our loyalty programme to promote initiatives.

 

Outlook

BOTB has delivered increased revenues and profits slightly ahead of management's expectations and remains cash generative, with a strong balance sheet and sufficient funds to invest in our online growth.  We believe the streamlined, online-only business is well positioned for the new financial year which has started well and I look forward to updating shareholders on further progress in due course.  

 

KEY PERFORMANCE INDICATORS

The Directors have monitored the performance of the Company and Group with particular reference to the following key performance indicators:

 

1.     Sales, both online and at retail sites, compared to the prior year.

2.     Marketing efficiency, calculated using the twelve month Lifetime Value per customer, against the Cost per Acquisition.

 

RISK MANAGEMENT

In order to execute the Company's strategy, the Company will be exposed to both financial and non-financial risks.  The Board has overall responsibility for the Company's risk management and it is the Board's role to consider whether those risks identified by management are acceptable within the Company's strategy and risk appetite.  The Board therefore regularly reviews the principal risks and considers how effective and appropriate the controls that management has in place to mitigate the risk exposure are and will make recommendations to management accordingly.

 

Financial Risk Management

 

Credit risk

The exposure to credit risk is limited to the carrying amounts of financial assets.  There is considered to be little exposure to credit risk arising on receivables due to the low value of receivables held at the year-end.  The credit risk arising on cash balances is limited because the third parties are banks with high credit ratings assigned by international credit rating agencies.

 

Liquidity risk

Sufficient cash balances are maintained to ensure that there are available funds for operations.  Operations are financed principally from equity and cash reserves.

 

Non-financial Risk Management

 

Interruption to website and associated IT infrastructure

As the Company and Group now operate substantially online, they are heavily reliant on the effective operation of their website and associated IT infrastructure.  Any interruption to the website or IT infrastructure would therefore have an immediate and significant impact on the Company and Group.

 

The Company and Group have various processes and controls in place to ensure the likelihood of interruption is minimised and, in the unlikely event that the website or IT infrastructure failed, it could be returned to operation in a short space of time.  This includes having contracts in place with third party suppliers to ensure any potential source of interruption is identified promptly and also to ensure that data, including customers' data, is protected.

 

Management and key personnel

The success of the Company and the Group to a significant extent is dependent on the Executive Directors and other senior managers.  To mitigate the risk of losing such personnel, the Company and Group endeavour to ensure that they are fairly remunerated and well incentivised.

 

Regulatory change

The Company and Group currently operate weekly skilled competitions, which are not regulated.  This could be subject to change in the future and the Company and Group continue to seek appropriate legal advice to ensure they comply with all relevant legislation and licensing.

 

 

 

 

 

 

 

STATEMENT OF DIRECTORS' RESPONSIBILITIES

The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

 

Company law requires the Directors to prepare financial statements for each financial year.  Under that law, the Directors have elected to prepare the financial statements in accordance with International Financial Reporting Standards as adopted by the European Union ("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 Company and the Group and of the profit or loss of 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 that the financial statements comply with IFRS; and

 

-       prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

 

The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Company's and the Group's transactions and disclose with reasonable accuracy at any time the financial position of the Company and the Group 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 the Group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

 

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company's website.

 

 

ON BEHALF OF THE BOARD

 

 

William Hindmarch

Chief Executive

19 June 2019

 

 

 

 

 

 

 

 

Notes

2019

 

2018

 

 

£

 

£

 

 

 

 

 

CONTINUING OPERATIONS

 

 

 

 

Revenue

 

14,806,972

 

12,947,716

Cost of sales

 

(6,541,790)

 

(5,504,906)

GROSS PROFIT

 

8,265,182

 

7,442,810

Administrative expenses

 

(6,157,945)

 

(5,843,662)

OPERATING PROFIT BEFORE EXCEPTIONAL ITEMS

 

2,107,237

 

1,599,148

Exceptional income

6

4,597,926

 

-

Exceptional expense

6

(2,023,500)

 

-

OPERATING PROFIT

 

4,681,663

 

1,599,148

Finance income

8

17,902

 

947

PROFIT BEFORE INCOME TAX

9

4,699,565

 

1,600,095

Income tax

10

(858,411)

 

(253,077)

PROFIT FOR THE YEAR

 

3,841,154

 

1,347,018

 

 

 

 

 

OTHER COMPREHENSIVE INCOME

 

 

 

 

Items that may be reclassified to profit or loss

 

 

 

 

Exchange differences on translating foreign operations

 

(55)

 

1,578

OTHER COMPREHENSIVE INCOME FOR THE

 

 

 

 

  YEAR, NET OF INCOME TAX

 

(55)

 

1,578

TOTAL COMPREHENSIVE INCOME FOR THE

 

 

 

 

  YEAR

 

3,841,099

 

1,348,596

 

 

 

 

 

Profit attributable to:

 

 

 

 

  Owners of the parent

 

3,841,154

 

1,347,018

 

 

 

 

 

Total comprehensive income attributable to:

 

 

 

 

  Owners of the parent

 

3,841,099

 

1,348,596

 

 

 

 

 

 

 

 

 

 

Earnings per share expressed in pence per share

 

 

 

 

  Basic from continuing operations

12

38.54

 

13.32

  Diluted from continuing operations

12

38.52

 

13.29

  Adjusted basic from continuing operations

12

17.62

 

13.32

  Adjusted diluted from continuing operations

12

17.61

 

13.29

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

  

The notes form part of this preliminary announcement

BEST OF THE BEST PLC

Consolidated Statement of Financial Position

As at 30 April 2019

 

 

 

Notes

2019

 

2018

 

 

£

 

£

ASSETS

 

 

 

 

NON-CURRENT ASSETS

 

 

 

 

Intangible assets

14

9,200

 

127,316

Property, plant and equipment

15

1,117,368

 

1,144,830

Investments

16

-

 

-

Deferred tax

21

12,578

 

40,445

 

 

1,139,146

 

1,312,591

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

Trade and other receivables

17

159,756

 

150,123

Cash and cash equivalents

18

2,544,636

 

2,322,073

 

 

2,704,392

 

2,472,196

 

 

 

 

 

TOTAL ASSETS

 

3,843,538

 

3,784,787

 

 

 

 

 

EQUITY

 

 

 

 

SHAREHOLDERS' EQUITY

 

 

 

 

Called up share capital

19

468,860

 

504,926

Share premium

 

199,324

 

199,324

Capital redemption reserve

 

236,517

 

200,451

Foreign exchange reserve

 

26,372

 

26,427

Retained earnings

 

351,641

 

614,838

TOTAL EQUITY

 

1,282,714

 

1,545,966

 

 

 

 

 

LIABILITIES

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

Trade and other payables

20

1,792,894

 

1,929,039

Tax payable

 

407,930

 

103,232

Provision

22

360,000

 

206,550

TOTAL LIABILITIES

 

2,560,824

 

2,238,821

 

 

 

 

 

TOTAL EQUITY AND LIABILITIES

 

3,843,538

 

3,784,787

 

 

 

 

 

 

The financial statements were approved by the Board of Directors on 19 June 2019 and were signed on its behalf by:

 

 

 

 

 

 

 

……………………………..

W S Hindmarch

Director

 

 

  

 

 

The notes form part of this preliminary announcement

BEST OF THE BEST PLC

Company Statement of Financial Position

As at 30 April 2019

 

 

 

Notes

2019

 

2018

 

 

£

 

£

ASSETS

 

 

 

 

NON-CURRENT ASSETS

 

 

 

 

Intangible assets

14

9,200

 

127,316

Property, plant and equipment

15

1,117,368

 

1,144,830

Investments

16

-

 

-

Deferred tax

21

12,578

 

40,445

 

 

1,139,146

 

1,312,591

 

 

 

 

 

CURRENT ASSETS

 

 

 

 

Trade and other receivables

17

159,756

 

149,733

Cash and cash equivalents

18

2,544,311

 

2,315,988

 

 

2,704,067

 

2,465,721

 

 

 

 

 

TOTAL ASSETS

 

3,843,213

 

3,778,312

 

 

 

 

 

EQUITY

 

 

 

 

SHAREHOLDERS' EQUITY

 

 

 

 

Called up share capital

19

468,860

 

504,926

Share premium

 

199,324

 

199,324

Capital redemption reserve

 

236,517

 

200,451

Retained earnings

 

372,240

 

635,682

TOTAL EQUITY

 

1,276,941

 

1,540,383

 

 

 

 

 

LIABILITIES

 

 

 

 

CURRENT LIABILITIES

 

 

 

 

Trade and other payables

20

1,798,342

 

1,927,439

Tax payable

 

407,930

 

103,940

Provision

22

360,000

 

206,550

TOTAL LIABILITIES

 

2,566,272

 

2,237,929

 

 

 

 

 

TOTAL EQUITY AND LIABILITIES

 

3,843,213

 

3,778,312

 

 

 

 

 

 

The profit attributable to shareholders dealt with in the financial statements of the Company was £3,840,909

(2018: £1,488,635).

 

The financial statements were approved by the Board of Directors on 19 June 2019 and were signed on its behalf by:

 

 

 

 

 

 

 

……………………………..

W S Hindmarch

Director

 

 

 

 

 

 

The notes form part of this preliminary announcement

BEST OF THE BEST PLC

Consolidated Statement of Changes in Equity

For the year ended 30 April 2019

 

 

 

 

 

Called up

 share capital

 

 

Share premium

 

Capital redemption reserve

 

 

£

 

£

 

£

 

 

 

 

 

 

 

Balance at 1 May 2017

 

506,226

 

179,074

 

197,651

   Issue of share capital

 

1,500

 

20,250

 

-

   Dividends paid

 

-

 

-

 

-

   Share re-purchase

 

(2,800)

 

-

 

2,800

Transactions with owners

 

(1,300)

 

20,250

 

2,800

   Profit for the year

 

-

 

-

 

-

Other comprehensive income

 

 

 

 

 

 

   Exchange differences arising on translating

 

 

 

 

 

 

   foreign operations

 

-

 

-

 

-

Total comprehensive income

 

-

 

-

 

-

Balance at 30 April 2018

 

504,926

 

199,324

 

200,451

   Dividends paid

 

-

 

-

 

-

   Share re-purchase

 

(36,066)

 

-

 

36,066

Transactions with owners

 

(36,066)

 

-

 

36,066

   Profit for the year

 

-

 

-

 

-

Other comprehensive income

 

 

 

 

 

 

   Exchange differences arising on translating 

 

 

 

 

 

 

   foreign operations

 

-

 

-

 

-

Total comprehensive income

 

-

 

-

 

-

Balance at 30 April 2019

 

468,860

 

199,324

 

236,517

 

 

 

 

Foreign exchange reserve

 

 

Retained earnings

 

 

 

Total

 

 

£

 

£

 

£

 

 

 

 

 

 

 

Balance at 1 May 2017

 

24,849

 

962,108

 

1,869,908

   Issue of share capital

 

-

 

-

 

21,750

   Dividends paid

 

-

 

(1,557,535)

 

(1,557,535)

   Share re-purchase

 

-

 

(136,753)

 

(136,753)

Transactions with owners

 

-

 

(1,694,288)

 

(1,672,538)

   Profit for the year

 

-

 

1,347,018

 

1,347,018

Other comprehensive income

 

 

 

 

 

 

  Exchange differences arising on translating

 

 

 

 

 

 

   foreign operations

 

1,578

 

-

 

1,578

Total comprehensive income

 

1,578

 

1,347,018

 

1,348,596

Balance at 30 April 2018

 

26,427

 

614,838

 

1,545,966

   Dividends paid

 

-

 

(605,915)

 

(605,915)

   Share re-purchase

 

-

 

(3,498,436)

 

(3,498,436)

Transactions with owners

 

-

 

(4,104,351)

 

(4,104,351)

   Profit for the year

 

-

 

3,841,154

 

3,841,154

Other comprehensive income

 

 

 

 

 

 

  Exchange differences arising on translating

 

 

 

 

 

 

   foreign operations

 

(55)

 

-

 

(55)

Total comprehensive income

 

(55)

 

3,841,154

 

3,841,099

Balance at 30 April 2019

 

26,372

 

351,641

 

1,282,714

 

 

 

The notes form part of this preliminary announcement

BEST OF THE BEST PLC

Company Statement of Changes in Equity

For the year ended 30 April 2019

 

 

 

 

 

Called up

 share capital

 

 

Share premium

 

Capital redemption reserve

 

 

£

 

£

 

£

 

 

 

 

 

 

 

Balance at 1 May 2017

 

506,226

 

179,074

 

197,651

   Issue of share capital

 

1,500

 

20,250

 

-

   Dividends paid

 

-

 

-

 

-

   Share re-purchase

 

(2,800)

 

-

 

2,800

Transactions with owners

 

(1,300)

 

20,250

 

2,800

   Profit for the year

 

-

 

-

 

-

Total comprehensive income

 

-

 

-

 

-

Balance at 30 April 2018

 

504,926

 

199,324

 

200,451

   Dividends paid

 

-

 

-

 

-

   Share re-purchase

 

(36,066)

 

-

 

36,066

Transactions with owners

 

(36,066)

 

-

 

36,066

   Profit for the year

 

-

 

-

 

-

Total comprehensive income

 

-

 

-

 

-

Balance at 30 April 2019

 

468,860

 

199,324

 

236,517

 

 

 

 

 

Retained

earnings

 

 

 

Total

 

 

£

 

£

 

 

 

 

 

Balance at 1 May 2017

 

841,335

 

1,724,286

   Issue of share capital

 

-

 

21,750

   Dividends paid

 

(1,557,535)

 

(1,557,535)

   Share re-purchase

 

(136,753)

 

(136,753)

Transactions with owners

 

(1,694,288)

 

(1,672,538)

   Profit for the year

 

1,488,635

 

1,488,635

Total comprehensive income

 

1,488,635

 

1,488,635

Balance at 30 April 2018

 

635,682

 

1,540,383

   Dividends paid

 

(605,915)

 

(605,915)

   Share re-purchase

 

(3,498,436)

 

(3,498,436)

Transactions with owners

 

(4,104,351)

 

(4,104,351)

   Profit for the year

 

3,840,909

 

3,840,909

Total comprehensive income

 

3,840,909

 

3,840,909

Balance at 30 April 2019

 

372,240

 

1,276,941

 

 

 

The notes form part of this preliminary announcement

BEST OF THE BEST PLC

Consolidated Statement of Cash Flows

For the year ended 30 April 2019

 

 

 

Notes

2019

 

2018

 

 

£

 

£

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

Cash generated from operations

28

4,763,838

 

2,236,879

Tax paid

 

(525,846)

 

(428,901)

Net cash from operating activities

 

4,237,992

 

1,807,978

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

Purchase of intangible assets

 

(9,200)

 

(38,250)

Purchase of property, plant and equipment

 

(128,550)

 

(14,137)

Sales of property, plant and equipment

 

208,770

 

131,917

Interest received

 

17,902

 

947

Net cash from investing activities

 

88,922

 

80,477

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

Proceeds from share issue

 

-

 

21,750

Share re-purchase

 

(3,498,436)

 

(136,753)

Equity dividends paid

 

(605,915)

 

(1,557,535)

Net cash from financing activities

 

(4,104,351)

 

(1,672,538)

 

 

 

 

 

Increase in cash and cash equivalents

 

222,563

 

215,917

Cash and cash equivalents at beginning of year

 

2,322,073

 

2,106,156

Cash and cash equivalents at end of year

18

2,544,636

 

2,322,073

 

 

 

 

 

 

 

 

 

 

 

 

The notes form part of this preliminary announcement

BEST OF THE BEST PLC

Company Statement of Cash Flows

For the year ended 30 April 2019

 

 

 

Notes

2019

 

2018

 

 

£

 

£

 

 

 

 

 

CASH FLOWS FROM OPERATING ACTIVITIES

 

 

 

 

Cash generated from operations

28

4,770,306

 

2,262,980

Tax paid

 

(526,554)

 

(431,839)

Net cash from operating activities

 

4,243,752

 

1,831,141

 

 

 

 

 

CASH FLOWS FROM INVESTING ACTIVITIES

 

 

 

 

Purchase of intangible assets

 

(9,200)

 

(38,250)

Purchase of property, plant and equipment

 

(128,550)

 

(14,137)

Sales of property, plant and equipment

 

208,770

 

131,917

Interest received

 

17,902

 

947

Net cash from investing activities

 

88,922

 

80,477

 

 

 

 

 

CASH FLOWS FROM FINANCING ACTIVITIES

 

 

 

 

Proceeds from share issue

 

-

 

21,750

Share re-purchase

 

(3,498,436)

 

(136,753)

Equity dividends paid

 

(605,915)

 

(1,557,535)

Net cash from financing activities

 

(4,104,351)

 

(1,672,538)

 

 

 

 

 

Increase in cash and cash equivalents

 

228,323

 

239,080

Cash and cash equivalents at beginning of year

 

2,315,988

 

2,076,908

Cash and cash equivalents at end of year

18

2,544,311

 

2,315,988

 

 

 

 

 

 

 

 

 

 

 

  

 

 

The notes form part of this preliminary announcement

BEST OF THE BEST PLC

Notes to the Preliminary Announcement

For the year ended 30 April 2019

 

 

1.   GENERAL INFORMATION

The principal activity of the Company and the Group is to operate weekly competitions to win luxury cars and other prizes online.

 

These financial statements have been prepared in accordance with International Financial Reporting Standards ("IFRS") and International Financial Reporting Interpretation Committee ("IFRIC") Interpretations as issued by the International Accounting Standards Board and adopted by the European Union and in accordance with those parts of the Companies Act 2006 applicable to those companies reporting under IFRS.  The financial statements have been prepared under the historical cost convention.

 

The principal accounting policies adopted in the preparation of the financial statements are set out below.  The policies have been consistently applied to all years presented, unless otherwise stated.

 

The financial statements are presented in Pounds Sterling.  All amounts, unless otherwise stated, have been rounded to the nearest Pound.

 

The preparation of financial statements in compliance with adopted IFRS requires the use of certain critical accounting estimates.  It also requires management to exercise judgement in applying those accounting policies.  The areas where significant judgements and estimates have been made in preparing these financial statements and their effect are disclosed in Note 4.

 

The Directors are satisfied that the Company and Group have adequate resources to continue in business for the foreseeable future.  For this reason, they continue to adopt the going concern basis in preparing the financial statements.

 

2.   PRINCIPAL ACCOUNTING POLICIES

 

2.1 NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS

The Company and Group applied for the first time certain Standards, Amendments and Interpretations which are effective for annual periods commencing on or after 1 May 2018.  The Company and Group have not early adopted any other Standards, Amendments or Interpretations that have been issued but are not yet effective.

 

IFRS 2 Share Based Payments

Amendments to IFRS 2 clarify the classification and measurement of share-based payment transactions.  The Amendments apply to certain types of share-based payment transactions, including those which are cash-settled and those with net settlement features and also apply where an entity has to account for modifications of share-based payment transactions from cash-settled to equity-settled.  The Company and Group have not entered into any of these types of share-based payment transactions during the current or prior year and the Amendments have therefore not affected the Company or Group.

 

IFRS 9 Financial Instruments

Amendments to IFRS 9 address the classification, measurement, impairment and de-recognition of financial assets and financial liabilities together with a new hedge accounting model.

 

The Amendments have not resulted in any classification, measurement, impairment or de-recognition changes to the Company's or Group's financial assets and liabilities.  In particular, the Company's and Group's financial assets comprise of trade and other receivables and cash and short-term deposits.  These financial assets continue to be classified and measured at amortised cost.  The Company's and Group's principal financial liabilities include trade and other payables.  These financial liabilities continue to be classified and measured at amortised cost.

 

The Company and Group applies the simplified approach to providing for expected credit losses in accordance with applicable guidance for non-banking entities.  Under the simplified approach the Company and Group are required to measure lifetime expected credit losses for all trade receivables.
 

 

2.   PRINCIPAL ACCOUNTING POLICIES (continued)

 

2.1 NEW STANDARDS, AMENDMENTS AND INTERPRETATIONS (continued)

IFRS 15 Revenue from Contracts with Customers

The Standard is effective for periods beginning on or after 1 January 2018 and sets out at what point and how revenue is recognised and also requires enhanced disclosures.  Revenue contracts should be recognised in accordance with a single, principles based five-step plan and when control of goods and services has transferred to the customer, with revenue recognised at the value the Company and Group expects to be entitled to receive.

 

The Company and Group have adopted IFRS 15 for the first time in the year ended 30 April 2019, although the revenue recognition policy remains unchanged from that previously disclosed in the 2018 financial statements and adopting IFRS 15 has not resulted in a change of timing of revenue recognition for the Company or Group, which continues to be recognised on the date that the result of an individual competition is determined.

 

Adoption of IFRS 15 has not resulted in any changes to the Company's and Group's results as previously reported.

 

IFRIC 22 Foreign Currency Transactions and Advance Consideration

The Interpretation clarifies the accounting for transactions that include the receipt or payment of advance consideration in a foreign currency.

 

Adoption of the IFRIC has not resulted in any change in the accounting for receipts or payments of advance consideration in a foreign currency.

 

At the date of authorisation of these financial statements, certain new Standards, Amendments and Interpretations to existing Standards have been published but are not yet effective and have not been adopted early by the Company and Group.

 

Management anticipates that all of the pronouncements will be adopted in the accounting periods for the first period beginning after the effective date of the pronouncement.  Information on new Standards, Amendments and Interpretations that are expected to be relevant to the financial statements is provided below.  Certain other new Standards, Amendments and Interpretations have been issued but are not expected to be relevant to the financial statements.

 

IAS 12 Income Taxes

The Amendments result from the Annual Improvements 2015-2017 cycle and address the income tax consequences of dividends.  The Amendments are effective for accounting periods commencing on or after 1 January 2019.

 

IFRS 16 Leases

The Standard will replace IAS 17 Leases and will eliminate the classification of leases as either operating leases or finance leases and, instead, introduce a single lessee accounting model.  The Standard provides a single lessee accounting model, specifying how leases are recognised, measured, presented and disclosed.  The Directors are currently evaluating the financial and operational impact of this Standard.  This review will require an assessment of all leases and the impact of adopting this Standard cannot be reliably estimated until this work is substantially complete.  The Standard is effective for accounting periods commencing on or after 1 January 2019.

 

IFRIC 23 Uncertainty over Income Tax Treatments

IFRIC 23 is to be applied in determining the taxable profit or loss, tax bases, unused tax losses, unused tax credits and tax rates.  It is to be applied where there is uncertainty over the income tax treatment under IAS 12.  The Interpretation is effective for accounting periods commencing on or after 1 January 2019.

 

The Directors do not expect that the adoption of the Standards, Amendments and Interpretations listed above will have a material impact on the financial statements of the Company and Group in future periods, although the detailed impact has not yet been quantified.
 

 

 

2.   PRINCIPAL ACCOUNTING POLICIES (continued)

 

2.2 BASIS OF CONSOLIDATION

The consolidated financial statements incorporate the financial statements of the Company and entities controlled by the Company (its subsidiary undertakings).  Where necessary, adjustments are made to the financial statements of the subsidiaries to bring their accounting policies in line with those of the Group.  All intra-Group transactions, balances, income and expenses are eliminated on consolidation.

 

2.3 REVENUE RECOGNITION

The Company and Group operate weekly competitions to win luxury cars and other prizes online.  Revenue represents the value of tickets sold in respect of these competitions and is stated net of VAT, where applicable, and returns, rebates and discounts.  Revenue in respect of weekly competitions is recognised on the date the result of those individual competitions is determined, being the point when all performance obligations have been fulfilled. 

 

2.4 COST OF SALES

Cost of sales comprises principally of the cost of competition prizes, duties, rent and the associated costs of operating retail sites.

 

2.5 EXCEPTIONAL ITEMS

Exceptional items are those items the Company and Group consider to be non-recurring or material in nature that may distort an understanding of financial performance or impair comparability.

 

2.6 SEGMENT REPORTING

The accounting policy for identifying segments is based on internal management reporting information which is reviewed by the chief operating decision maker.  The Company and Group are considered to have a single business segment, being the operation of weekly competitions to win luxury cars and other prizes.

 

2.7 RESEARCH AND DEVELOPMENT EXPENDITURE

Expenditure on research is recognised as an expense in the period in which it is incurred.

 

Development costs are capitalised when all of the following conditions are satisfied:

 

·      Completion of the intangible asset is technically feasible so that it will be available for use or sale;

 

·      The Company or Group intends to complete the intangible asset and use or sell it;

 

·      The Company or Group has the ability to use or sell the intangible asset;

 

·      The intangible asset will generate probable future economic benefits.  Amongst other things, this requires that there is a market for the output from the intangible asset or for the intangible asset itself, or, if it is to be used internally, the asset will be used in generating such benefits;

 

·      There are adequate technical, financial and other resources to complete the development and to use or sell the intangible asset; and

 

·      The expenditure attributable to the intangible asset during its development can be measured reliably.

 

Development costs not meeting the criteria for capitalisation are expensed as incurred.

 

2.   PRINCIPAL ACCOUNTING POLICIES (continued)

 

2.8   FOREIGN CURRENCIES

Assets and liabilities in foreign currencies are translated into Sterling at the rates of exchange ruling at the statement of financial position date.  Transactions in foreign currencies are translated into Sterling at the rates of exchange ruling at the date of the transaction.  Exchange differences are taken into account in arriving at the operating result.

 

The assets and liabilities in the financial statements of foreign subsidiaries are translated into the Parent Company's presentation currency at the rates of exchange ruling at the statement of financial position date.  Income and expenses are translated at the actual rate on the date of the transaction.  The exchange differences arising from the retranslation of the opening net investment in subsidiaries are recognised in other comprehensive income and taken to the foreign exchange reserve in equity.  On disposal of a foreign subsidiary, the cumulative translation differences are transferred to profit or loss as part of the gain or loss on disposal.

 

2.9   SHARE BASED PAYMENT

The Company and Group have applied the requirements of IFRS 2 to share option schemes allowing certain employees within the Group to acquire shares of the Company.  For all grants of share options, the fair value as at the date of grant is calculated using the Black-Scholes option pricing model, taking into account the terms and conditions upon which the options were granted.  The amount recognised as an expense is adjusted to reflect the actual number of share options that are likely to vest, except where forfeiture is only due to market-based conditions not achieving the threshold for vesting.  The expense is recognised over the expected life of the option.

 

2.10 PENSION CONTRIBUTIONS AND OTHER POST EMPLOYMENT BENEFITS

The Company operates a money purchase pension scheme for certain employees.  The cost of the contributions is charged to the statement of comprehensive income as incurred.

 

2.11 TAXATION

Current taxes are based on the results shown in the financial statements and are calculated according to local tax rules, using tax rates enacted or substantively enacted by the statement of financial position date.

 

The tax currently payable is based on the taxable profit for the year.  Taxable profit/(loss) differs from the net profit/(loss) reported in the statement of comprehensive income as it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible.

 

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the financial statements and the corresponding tax bases used in the computation of taxable profit and is accounted for using the balance sheet liability method.  Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which the deductible temporary differences can be utilised.  Such assets and liabilities are not recognised if the temporary differences arise from the initial recognition (other than in a business combination) of other assets or liabilities in a transaction that affects neither the tax profit nor the accounting profit.

 

The carrying amount of the deferred tax asset is reviewed at each statement of financial position date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

 

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised.  Deferred tax is charged or credited in the statement of comprehensive income, except when it relates to items charged or credited directly to equity, in which case deferred tax is also dealt with in equity.

 

 

2.   PRINCIPAL ACCOUNTING POLICIES (continued)

 

2.12 IMPAIRMENT

The carrying amounts of the Company's and Group's assets are reviewed at each statement of financial position date to determine whether there is any indication of impairment.  If any such indicator exists, the asset's recoverable amount is estimated.

 

An impairment loss is recognised whenever the carrying amount of an asset exceeds its recoverable amount.  Impairment losses are recognised in the statement of comprehensive income.

 

The recoverable amount of an asset is the greater of its net selling price and value in use.  In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects the current market assessments of the time value of money and the risks specific to the asset.

 

An impairment loss is reversed if there has been a change in the estimates used to determine the recoverable amount.  An impairment loss is reversed only to the extent that the asset's carrying amount does not exceed the carrying amount that would have been determined, net of depreciation and amortisation, if no impairment loss had been recognised.

 

2.13 CURRENT VERSUS NON-CURRENT CLASSIFICATION

The Company and Group present assets and liabilities in the statement of financial position based on current/non-current classification.  An asset is current when it is:

 

·      expected to be realised or intended to be sold or consumed in the normal operating cycle; or

·      held primarily for the purpose of trading; or

·      expected to be realised within twelve months after the reporting period; or

·      cash or cash equivalents unless restricted from being exchanged or used to settle a liability for at least twelve months after the reporting date.

 

All other assets are classified as non-current.

 

A liability is current when:

 

·      it is expected to be settled in the normal operating cycle; or

·      it is held primarily for the purpose of trading; or

·      it is due to be settled within twelve months after the reporting period; or

·      there is no unconditional right to defer the settlement of the liability for at least twelve months after the reporting date.

 

The Company and Group classify all other liabilities as non-current.

 

Deferred tax assets and liabilities are classified as non-current assets and liabilities. 

2.   PRINCIPAL ACCOUNTING POLICIES (continued)

 

2.14 INTANGIBLE ASSETS

Intangible assets are recognised at cost less any accumulated amortisation and impairment.

 

An intangible asset, which is an identifiable non-monetary asset without physical substance, is recognised to the extent that it is probable that the expected future economic benefits attributable to the asset will flow to the Company or Group and that its cost can be measured reliably.  The asset is deemed to be identifiable when it is separate or when it arises from contractual or other legal rights.

 

The Company's and Group's intangible assets consist of its IT platform, infrastructure and website.  The Directors have estimated the useful economic life of the assets to be three years and they are being amortised over that period on a straight line basis.

 

2.15 PROPERTY, PLANT AND EQUIPMENT

Property, plant and equipment is stated at cost, net of accumulated depreciation and accumulated impairment losses, if any.

 

Depreciation is provided at the following annual rates in order to write off each asset over its useful economic life:

 

Long leasehold property                                  - 1% on cost

Improvements to property                               - 4% on cost

Display equipment                                          - At varying rates on cost

Fixtures and fittings                                        - At varying rates on cost

Motor vehicles                                                - 25% on reducing balance

Computer equipment                                       - At varying rates on cost

 

An item of property, plant and equipment is derecognised upon disposal or when no future economic benefits are expected from the use or disposal.  Any gain or loss arising on de-recognition of the asset (calculated as the difference between the net disposal proceeds and the carrying amount of the asset) is included in the statement of comprehensive income when the asset is derecognised.

 

The residual values, useful economic lives and methods of depreciation are reviewed at each financial year end and adjusted prospectively, if appropriate.

 

2.16 INVESTMENTS

Investments in subsidiaries are recorded at cost less any provision for permanent diminution in value.

 

2.17 LEASES

The determination of whether an arrangement is or contains a lease is based on the substance of the arrangement at the inception of the lease.  The arrangement is, or contains, a lease if fulfilment of the arrangement is dependent on the use of a specific asset or assets and the arrangement conveys a right to use the asset or assets, even if that right is not explicitly specified in an arrangement.

 

A lease is classified at the inception date as a finance lease or an operating lease.  A lease that transfers substantially all the risks and rewards incidental to ownership to the Company and Group is classified as a finance lease.  The Company and Group have not entered into any finance leases during any financial year included in these financial statements.

 

An operating lease is a lease other than a finance lease.  Operating lease payments are recognised as an operating expense in the statement of comprehensive income on a straight line basis over the lease term.

 

 

2.   PRINCIPAL ACCOUNTING POLICIES (continued)

 

2.18 PROVISIONS

Provisions are liabilities where the exact timing or amount of the obligation is uncertain.  Provisions are recognised when the Company or Group has a present obligation (legal or constructive) as a result of a past event, it is probable that an outflow of resources embodying economic benefits will be required to settle the obligation and a reliable estimate can be made of the amount of the obligation.  Where the time value of money is material, provisions are discounted to current values using appropriate rates of interest.  The unwinding of the discounts is recorded in net finance income or expense.

 

2.19 FINANCIAL INSTRUMENTS

Financial assets and liabilities are recognised in the Company's and Group's statement of financial position when the Company and Group become a party to the contractual provisions of the instrument.  The Company's and Group's financial instruments comprise cash, trade and other receivables and trade and other payables.

 

Trade and other receivables

Trade and other receivables are initially stated at their fair value plus transaction costs, then subsequently at amortised cost using the effective interest method, if applicable, less impairment losses.  Provisions against trade and other receivables are made when there is objective evidence that the Company and Group will not be able to collect all amounts due to them in accordance with the original terms of those receivables.  The amount of the write down is determined as the difference between the asset's carrying amount and the present value of estimated future cash flows.

 

Cash and cash equivalents

The Company and Group manage short-term liquidity through the holding of cash and highly liquid interest-bearing deposits.  Only deposits that are readily convertible into cash with maturities of three months or less from inception, with no penalty of lost interest, are shown as cash and cash equivalents.

 

Trade payables

Financial liabilities are obligations to pay cash or other financial assets and are recognised when the Company and Group becomes a party to the contractual provisions of the instrument.  All financial liabilities are recorded at amortised cost using the effective interest method, with interest-related charges recognised as an expense in finance cost in the statement of comprehensive income.

 

2.20 EQUITY

Equity comprises the following:

 

·      Called up share capital represents the nominal value of the equity shares;

·      Share premium represents the excess over nominal value of the fair value of consideration received from the equity shares, net of expenses of the share issue;

·      Capital redemption reserve represents the value of the re-purchase by the Company of its own share capital;

·      Foreign exchange reserve represents accumulated exchange differences from the translation of subsidiaries with a functional currency other than Sterling; and

·      Retained earnings represent accumulated profits and losses from incorporation and any credit arising under share based payments

 

 

 

3.   CAPITAL MANAGEMENT

The Company defines capital as the total equity of the Company.  The objective of the Company's capital management is to ensure that it makes the maximum use of its capital to support its business and to maximise shareholder value.  There are no external constraints on the Company's capital.

 

4.   CRITICAL JUDGEMENTS AND ACCOUNTING ESTIMATES

The Company and Group make certain estimates and assumptions regarding the future.  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.  In the future, actual expenditure may differ from these estimates and assumptions.  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.

 

Impairment of assets

The Company and Group are required to consider assets for impairment where such indicators exist, using value in use calculations or fair value estimates.  The use of these methods may require the estimation of future cash flows and the choice of a discount rate in order to calculate the present value of the cash flows.  Actual outcomes may vary.

 

Useful lives of property, plant and equipment and intangible assets

Property, plant and equipment are depreciated and intangible assets are amortised over their useful lives.  Useful lives are based on management's estimates, which are periodically reviewed for continued appropriateness.  Changes to estimates can result in variations in the carrying values and amounts charged to the statement of comprehensive income in specific periods.

 

5.   SEGMENTAL REPORTING

For management purposes, the Company and Group are considered to have one single business segment, being the operation of weekly competitions to win luxury cars and other prizes.  The Group comprises Best of the Best PLC and its subsidiary company BOTB Ireland Limited.  BOTB Ireland Limited generated no sales during either the current or prior year and it holds few assets and is expected to have very little trading activity going forward.  The two companies do not transact with each other.  Further segment information is therefore not presented in these financial statements. 

Sales from UK activities totalled £12,098,896 (2018: £10,386,359) whilst sales from non-UK activities totalled £2,708,076 (2018: £2,561,357).

 

6.   EXCEPTIONAL INCOME AND EXPENSE

On 19 May 2018, the Company received a retrospective VAT refund from H M Revenue and Customs ("HMRC") on its "Spot the Ball" game of £4,494,697 for the period from 1 March 2009 to 30 June 2017.  Accordingly, this sum, as well as an associated interest receipt, has been recognised as exceptional income in the financial year.  On 20 December 2018, the Company settled an agreed assessment issued by HMRC for retrospective taxation, making a payment of £1,758,875.  Accordingly, this sum has been recognised as an exceptional expense in the financial year, together with associated legal and professional costs of £264,625 incurred in connection with these claims.

  

 

7.   EMPLOYEES AND DIRECTORS

 

 

Group

 

Company

 

2019

 

2018

 

2019

 

2018

 

£

 

£

 

£

 

£

 

 

 

 

 

 

 

 

Wages and salaries

1,772,484

 

2,420,722

 

1,772,484

 

2,308,814

Social security costs

218,326

 

265,978

 

218,326

 

254,367

Other pension costs

62,892

 

64,520

 

62,892

 

64,520

 

2,053,702

 

2,751,220

 

2,053,702

 

2,627,701

 

The average monthly number of employees during the year, including the Directors, was as follows:

 

Group

 

Company

 

2019

 

2018

 

2019

 

2018

 

Number

 

Number

 

Number

 

Number

 

 

 

 

 

 

 

 

Sales

10

 

37

 

10

 

32

Administration

16

 

18

 

16

 

18

Management

3

 

2

 

3

 

2

 

29

 

57

 

29

 

52

 

2019

 

2018

 

£

 

£

 

 

 

 

Directors' remuneration

528,717

 

487,634

 

The number of Directors to whom retirement benefits were accruing was as follows:

 

 

2019

 

2018

 

Number

 

Number

 

 

 

 

Money purchase schemes

2

 

2

 

 

 

Information regarding the highest paid Director is as follows:

 

2019

 

2018

 

£

 

£

 

 

 

 

Emoluments

250,967

 

228,590

 

 

8.   FINANCE INCOME

 

 

2019

 

2018

 

£

 

£

 

 

 

 

Finance income:

 

 

 

Deposit account interest

17,902

 

947

 

 

 

9.   PROFIT BEFORE INCOME TAX

The profit before income tax is stated after charging/(crediting):

 

 

2019

 

2018

 

£

 

£

 

 

 

 

Depreciation and impairment of property, plant and equipment

80,174

 

126,036

Amortisation of intangible assets

127,316

 

89,067

Profit on disposal of property, plant and equipment

(132,932)

 

(31,658)

Operating lease expense - buildings

200,808

 

676,234

Operating lease expense - other

17,635

 

10,629

Foreign exchange losses/(gains)

-

 

6,813

Auditor's remuneration

 

 

 

   Audit fees

33,500

 

34,025

   Taxation services

2,631

 

6,750

   Other

22,500

 

13,000

 

 

10. INCOME TAX

Analysis of tax expense

 

 

2019

 

2018

 

£

 

£

 

 

 

 

Current tax:

 

 

 

  Current year charge

830,544

 

256,558

Total current tax

830,544

 

256,558

 

 

 

 

Deferred tax

 

 

 

   Origination and reversal of temporary timing differences

27,867

 

(3,481)

Total deferred tax

27,867

 

(3,481)

 

 

 

 

Total tax charge for the year

858,411

 

253,077

 

 

Factors affecting the tax expense

The tax assessed for the year is lower than the standard rate of corporation tax in the UK.  The difference is explained below:

 

 

2019

 

2018

 

£

 

£

 

 

 

 

Profit on ordinary activities before income tax

4,699,565

 

1,600,095

 

 

 

 

Profit on ordinary activities multiplied by the standard rate of corporation

 

 

 

  tax in the UK of 19% (2018: 19%)

892,917

 

304,018

 

 

 

 

Effects of:

 

 

 

  Depreciation in excess of capital allowances

38,222

 

7,632

  Other timing differences

1,074

 

(3,247)

  Non-deductible expenses

5,018

 

12,574

  Research and development enhanced deduction

(78,820)

 

(67,900)

Tax expense

858,411

 

253,077

 

Future tax developments

A reduction in the UK corporation tax rate from 19% to 17%, effective from 1 April 2020, was substantively enacted on 15 September 2016.  This will reduce the company's future tax charge accordingly. 

 

11. PROFIT OF THE PARENT COMPANY

As permitted by Section 408 of the Companies Act 2006, the income statement of the Parent Company is not presented as part of these financial statements.  The parent Company's profit for the financial year was £3,840,909 (2018: £1,488,635).

 

12. EARNINGS PER SHARE

Basic earnings per share is calculated by dividing the earnings attributable to the ordinary shareholders by the weighted average number of ordinary shares outstanding during the year.

 

Adjusted earnings per share is calculated by dividing the earnings attributable to the ordinary shareholders, before exceptional income and exceptional expense and associated corporation tax, by the weighted average number of ordinary shares outstanding during the year.

 

Diluted and adjusted diluted earnings per share is calculated using the weighted average number of shares outstanding during the year, adjusted to assume the exercise of all dilutive potential ordinary shares under the company's share option plans.

 

 

2019

 

2018

 

 

 

 

Profit for the year and basic and diluted earnings attributable to the

owners of the parent - £

 

3,841,154

 

 

1,347,018

Adjusted profit for the year and basic and diluted earnings attributable to the

owners of the parent - £

 

1,755,869

 

 

1,347,018

 

 

 

 

Weighted average number of ordinary shares - number

9,965,495

 

10,112,997

Basic earnings per share - pence

38.54p

 

13.32p

Adjusted basic earnings per share - pence

17.62p

 

13.32p

 

 

 

 

Adjusted weighted average number of ordinary shares - number

9,971,206

 

10,137,887

Diluted earnings per share - pence

38.52p

 

13.29p

Adjusted diluted earnings per share - pence

17.61p

 

13.29p

 

13. DIVIDENDS

The Company paid a final dividend of 1.5 pence per share on 21 September 2018, as recommended in the financial statements to 30 April 2018.  Furthermore, a Special Dividend of 4.5 pence per share was paid on 20 July 2018 to shareholders on the register at the close of business on 6 July 2018.

 

The Board is recommending a final dividend of 2.0 pence per share (2018: 1.5 pence per share) for the full year ending 30 April 2019 subject to shareholder approval at the Annual General Meeting on 11 September 2019.  The final dividend will be paid on 27 September 2019 to shareholders on the register on 13 September 2019.

 

14. INTANGIBLE ASSETS - GROUP AND COMPANY

 

Development costs

 

£

COST

 

At 1 May 2018

305,450

Additions

9,200

At 30 April 2019

314,650

 

 

AMORTISATION

 

At 1 May 2018

178,134

Charge for year

127,316

At 30 April 2019

305,450

 

 

NET BOOK VALUE

 

  2019

9,200

  2018

127,316

 

 

14. INTANGIBLE ASSETS - GROUP AND COMPANY (continued)

 

Development costs

 

£

COST

 

At 1 May 2017

267,200

Additions

38,250

At 30 April 2018

305,450

 

 

AMORTISATION

 

At 1 May 2017

89,067

Charge for year

89,067

At 30 April 2018

178,134

 

 

NET BOOK VALUE

 

  2018

127,316

  2017

178,133

 

15. PROPERTY, PLANT AND EQUIPMENT - GROUP AND COMPANY

 

 

Long
leasehold

 

Improvements to property

 

Display

equipment

 

Fixtures and fittings

 

£

 

£

 

£

 

£

COST

 

 

 

 

 

 

 

At 1 May 2018

954,034

 

25,950

 

473,591

 

170,219

Additions

-

 

-

 

-

 

2,110

Disposals

-

 

-

 

(370,927)

 

-

At 30 April 2019

954,034

 

25,950

 

102,664

 

172,329

 

 

 

 

 

 

 

 

DEPRECIATION AND IMPAIRMENT

 

 

 

 

 

 

 

At 1 May 2018

6,998

 

2,078

 

342,970

 

160,717

Charge for the year

3,500

 

1,090

 

31,106

 

11,612

Eliminated on disposals

-

 

-

 

(297,183)

 

-

At 30 April 2019

10,498

 

3,168

 

76,893

 

172,329

 

 

 

 

 

 

 

 

NET BOOK VALUE

 

 

 

 

 

 

 

  2019

943,536

 

22,782

 

25,771

 

-

  2018

947,036

 

23,872

 

130,621

 

9,502

 

 

Motor vehicles

 

Computer equipment

 

 

Total

 

£

 

£

 

£

COST

 

 

 

 

 

At 1 May 2018

58,275

 

115,137

 

1,797,206

Additions

112,582

 

13,858

 

128,550

Disposals

(15,486)

 

-

 

(386,413)

At 30 April 2019

155,371

 

128,995

 

1,539,343

 

 

 

 

 

 

DEPRECIATION AND IMPAIRMENT

 

 

 

 

 

At 1 May 2018

35,078

 

104,535

 

652,376

Charge for the year

21,085

 

11,781

 

80,174

Eliminated on disposals

(13,392)

 

-

 

(310,575)

At 30 April 2019

42,771

 

116,316

 

421,975

 

 

 

 

 

 

NET BOOK VALUE

 

 

 

 

 

  2019

112,600

 

12,679

 

1,117,368

  2018

23,197

 

10,602

 

1,144,83 

 

15. PROPERTY, PLANT AND EQUIPMENT - GROUP AND COMPANY (continued)

 

 

Long
leasehold

 

Improvements to property

 

Display

equipment

 

Fixtures and fittings

 

£

 

£

 

£

 

£

COST

 

 

 

 

 

 

 

At 1 May 2017

954,034

 

25,950

 

713,060

 

170,219

Additions

-

 

-

 

-

 

-

Disposals

-

 

-

 

(239,469)

 

-

At 30 April 2018

954,034

 

25,950

 

473,591

 

170,219

 

 

 

 

 

 

 

 

DEPRECIATION AND IMPAIRMENT

 

 

 

 

 

 

 

At 1 May 2017

3,500

 

1,040

 

414,855

 

139,177

Charge for the year

3,498

 

1,038

 

67,325

 

21,540

Eliminated on disposals

-

 

-

 

(139,210)

 

-

At 30 April 2018

6,998

 

2,078

 

342,970

 

160,717

 

 

 

 

 

 

 

 

NET BOOK VALUE

 

 

 

 

 

 

 

  2018

947,036

 

23,872

 

130,621

 

9,502

  2017

950,534

 

24,910

 

298,205

 

31,042

 

 

Motor vehicles

 

Computer equipment

 

 

Total

 

£

 

£

 

£

COST

 

 

 

 

 

At 1 May 2017

58,275

 

101,000

 

2,022,538

Additions

-

 

14,137

 

14,137

Disposals

-

 

-

 

(239,469)

At 30 April 2018

58,275

 

115,137

 

1,797,206

 

 

 

 

 

 

DEPRECIATION AND IMPAIRMENT

 

 

 

 

 

At 1 May 2017

27,341

 

79,637

 

665,550

Charge for the year

7,737

 

24,898

 

126,036

Eliminated on disposals

-

 

-

 

(139,210)

At 30 April 2018

35,078

 

104,535

 

652,376

 

 

 

 

 

 

NET BOOK VALUE

 

 

 

 

 

  2018

23,197

 

10,602

 

1,144,830

  2017

30,934

 

21,363

 

1,356,988

 

 

16. INVESTMENTS

 

Group

 

Unlisted investments

 

£

 

 

COST

 

At 1 May 2018 and 30 April 2019

70,000

 

 

IMPAIRMENT

 

At 1 May 2018 and 30 April 2019

70,000

 

 

NET BOOK VALUE

 

  At 1 May 2018 and 30 April 2019

-

 

Unlisted investments relate to the cost of acquiring options in another company. 

 

 

Company

 

 

Shares in group undertakings

 

 

Unlisted investments

 

 

 

Total

 

£

 

£

 

£

 

 

 

 

 

 

COST

 

 

 

 

 

At 1 May 2018 and 30 April 2019

85

 

70,000

 

70,085

 

 

 

 

 

 

IMPAIRMENT

 

 

 

 

 

At 1 May 2018 and 30 April 2019

85

 

70,000

 

70,085

 

 

 

 

 

 

NET BOOK VALUE

 

 

 

 

 

  At 1 May 2018 and 30 April 2019

-

 

-

 

-

 

Shares in Group undertakings comprise of the following subsidiary company:

 

Name of company

 

Nature of business

 

% holding

 

Country of incorporation

BOTB Ireland Limited

 

Competition operator

 

100

 

Republic of Ireland

 

 

17. TRADE AND OTHER RECEIVABLES - GROUP AND COMPANY

 

 

Group

 

Company

 

2019

 

2018

 

2019

 

2018

 

£

 

£

 

£

 

£

 

 

 

 

 

 

 

 

Trade receivables

765

 

10,961

 

765

 

10,961

Other receivables

32,560

 

56,290

 

32,560

 

56,290

Prepayments and accrued income

126,431

 

82,872

 

126,431

 

82,482

 

159,756

 

150,123

 

159,756

 

149,733

 

The fair value of trade and other receivables approximates to their carrying values. 

  

18. CASH AND CASH EQUIVALENTS - GROUP AND COMPANY

 

 

Group

 

Company

 

2019

 

2018

 

2019

 

2018

 

£

 

£

 

£

 

£

 

 

 

 

 

 

 

 

Cash in hand

2,543,094

 

3,783

 

2,542,770

 

3,783

Bank accounts

1,542

 

2,318,290

 

1,541

 

2,312,205

 

2,544,636

 

2,322,073

 

2,544,311

 

2,315,988

 

19. CALLED UP SHARE CAPITAL - COMPANY

 

Allotted, issued and fully paid

2019

 

2018

 

2019

 

2018

Ordinary shares of 5pence each

Number

 

Number

 

£

 

£

 

 

 

 

 

 

 

 

At the start of the year

10,098,580

 

10,124,580

 

504,926

 

506,226

Shares allotted  during the year

-

 

30,000

 

-

 

1,500

Purchased for cancellation in the year

(721,327)

 

(56,000)

 

(36,066)

 

(2,800)

At the end of the year

9,377,253

 

10,098,580

 

468,860

 

504,926

 

On 15 February 2019, subject to a circular dated 30 January 2019, shareholders approved a proposed tender offer by finnCap Ltd to purchase Ordinary shares in the Company up to approximately 7.1% of the issued share capital at a price of 485 pence per share. Further to a repurchase agreement between the Company and finnCap Ltd, the Company exercised the call option and bought back and subsequently cancelled, 721,327 Ordinary Shares at a price of 485 pence per share.

 

No shares were allotted during the year.  In the prior year, 30,000 Ordinary shares of £0.05 per share were allotted as fully paid at a premium of £0.675 per share.  Furthermore, in the prior year 56,000 Ordinary shares of £0.05 per share were purchased by the Company and subsequently cancelled.

 

An amount equal to the nominal value of the Ordinary shares has been transferred to the capital redemption reserve.  The amount paid per share was £4.85 (2018: Between £2.20 and £2.55).  The difference between the amount paid and the nominal value of the shares re-purchased has been deducted from the retained earnings reserve.

 

20. TRADE AND OTHER PAYABLES - GROUP AND COMPANY

 

 

Group

 

Company

 

2019

 

2018

 

2019

 

2018

 

£

 

£

 

£

 

£

 

 

 

 

 

 

 

 

Trade creditors

343,186

 

388,063

 

343,186

 

387,396

Amounts owed to group undertakings

-

 

-

 

5,448

 

-

Social security and other taxes

392,533

 

463,946

 

392,533

 

463,946

Other creditors

978,262

 

1,076,798

 

978,262

 

1,075,865

Contract liability balances

73,030

 

-

 

73,030

 

-

Pension creditor

5,883

 

232

 

5,883

 

232

 

1,792,894

 

1,929,039

 

1,798,342

 

1,927,439

  

 

21. DEFERRED TAX - GROUP AND COMPANY

 

Group

 

Company

 

2019

 

2018

 

2019

 

2018

 

£

 

£

 

£

 

£

 

 

 

 

 

 

 

 

Asset at 1 May

40,445

 

36,964

 

40,445

 

36,964

Movement in the year

(27,867)

 

3,481

 

(27,867)

 

3,481

Asset at 30 April

12,578

 

40,445

 

12,578

 

40,445

 

Deferred tax assets have been recognised in respect of accelerated capital allowances giving rise to deferred tax assets where the Directors believe that it is probable that these assets will be recovered.

 

22. PROVISIONS - GROUP AND COMPANY

 

Group

 

Company

 

2019

 

2018

 

2019

 

2018

 

£

 

£

 

£

 

£

 

 

 

 

 

 

 

 

At 1 May

206,550

 

129,816

 

206,550

 

129,816

Utilised during the year

(151,050)

 

(129,816)

 

(151,050)

 

(129,816)

Additions

304,500

 

206,550

 

304,500

 

206,550

Asset at 30 April

360,000

 

206,550

 

360,000

 

206,550

 

The Directors have assessed that its retail site lease is onerous and a provision has been recognised in respect of future rental payments.

 

23. SHARE BASED PAYMENT - GROUP AND COMPANY

Details of the share options outstanding during the year are as follows:

 

 

Grant date

Outstanding at 1 May 2018

 

Granted

 

Exercised

 

Forfeited

Outstanding at 30 April 2019

 

Expiry date

 

Exercise price

 

 

 

 

 

 

 

 

19-12-2017

45,000

-

-

-

45,000

19-12-2027

£2.25

 

The Company and Group operate a share option scheme for certain Directors and employees.  Options are exercisable at a price defined by the individual option agreements.  The vesting period on each option is three years.  If the options remain unexercised during the specified period from the date of grant, the options expire.  Options are generally forfeited if the employee leaves the Group before the options vest, however, this is at the discretion of the Board.

 

Details of the share options and the weighted average exercise price ('WAEP') outstanding during the year are as follows:

 

 

2019

 

2019

 

2018

 

2018

 

Number

 

WAEP

 

Number

 

WAEP

 

 

 

 

 

 

 

 

Outstanding at the beginning of year

45,000

 

225.00

 

30,000

 

72.50

Granted during the year

-

 

-

 

45,000

 

225.00

Exercised during the year

-

 

-

 

(30,000)

 

(72.50)

Lapsed during the year

-

 

-

 

-

 

-

Outstanding at the end of the year

45,000

 

225.00

 

45,000

 

225.00

Exercisable at the end of the year

-

 

-

 

-

 

-

 

The weighted average remaining contractual life of share options outstanding as at 30 April 2019 was 8 years and 8 month (2018: 9 years and 8 months).

 

No amount has been recognised in these financial statements in respect of share option charges as the amount would be insignificant (2018: £Nil).  

 

24. LEASE COMMITMENTS - GROUP AND COMPANY

Future minimum rentals payable under operating leases at 30 April 2019 were as follows:

 

 

Buildings

 

Other

 

2019

 

2018

 

2019

 

2018

 

£

 

£

 

£

 

£

 

 

 

 

 

 

 

 

Due within one year

124,125

 

223,050

 

4,437

 

6,762

Due between one and two years

226,050

 

368,000

 

-

 

-

 

350,175

 

591,050

 

4,437

 

6,762

 

25. FINANCIAL RISK MANAGEMENT AND FINANCIAL INSTRUMENTS - GROUP AND COMPANY

The principal financial assets of the Group are bank balances.  The Group's principal financial liabilities are trade and other payables.  The main purpose of these financial instruments is to generate sufficient working capital for the Group to continue its operations.

 

Credit risk

The Group's exposure to credit risk is limited to the carrying amounts of financial assets recognised at the statement of financial position date, as summarised below.  Management considers that the Group is exposed to little credit risk arising on its receivables due to the value of those receivables.  The credit risk on cash balances is limited because the third parties are banks with high credit ratings assigned by international credit rating agencies.

 

 

 

 

 

 

2019

 

2018

 

 

 

 

 

£

 

£

Financial assets classified as loans and receivables - carrying amounts:

 

 

 

 

 

 

 

   Trade receivables

 

 

 

 

765

 

10,961

   Other receivables

 

 

 

 

32,560

 

56,290

   Cash and cash equivalents

 

 

 

 

2,544,636

 

2,322,073

 

 

 

 

 

2,577,961

 

2,389,324

 

Liquidity risk

The Group's funding strategy is to generate sufficient working capital to settle liabilities as they fall due and to ensure sufficient financial resource is in place to support management's long-term growth plans.

 

The Group's financial liabilities have contractual maturities as follows:

 

 

2019

 

2018

 

£

 

£

 

£

 

£

Financial liabilities measured at amortised cost - carrying amounts

Up to 1 year

 

After 1 year

 

Up to 1 year

 

After 1 year

 

 

 

 

 

 

 

 

Trade and other payables

1,719,864

 

-

 

1,929,039

 

-

 

1,719,864

 

-

 

1,929,039

 

-

 

26. RELATED PARTY DISCLOSURES

M W Hindmarch is considered to be a related party as he is a Non-Executive Director of the Company.  During the year ended 30 April 2019, payments were made to him totaling £12,000 (2018: £12,000) in respect of consultancy services provided.  The total amount due to M W Hindmarch at 30 April 2019 was £1,000 (2018: £1,000).

 

27. ULTIMATE CONTROLLING PARTY

The Company is under the ultimate control of W S Hindmarch, the Chief Executive Director of the Company, by virtue of his controlling shareholding at the statement of financial position date. 

 

28. RECONCILIATION OF PROFIT BEFORE INCOME TAX TO CASH GENERATED FROM OPERATIONS

 

Group

 

Company

 

2019

 

2018

 

2019

 

2018

 

£

 

£

 

£

 

£

 

 

 

 

 

 

 

 

Profit before income tax

4,699,565

 

1,600,095

 

4,699,320

 

1,741,712

Depreciation charges

80,174

 

126,036

 

80,174

 

126,036

Amortisation charges

127,316

 

89,067

 

127,316

 

89,067

Profit on disposal of property, plant and equipment

(132,932)

 

(31,658)

 

(132,932)

 

(31,658)

Investment impairment charge

-

 

70,000

 

-

 

70,085

Exchange differences

(55)

 

1,578

 

-

 

-

Finance income

(17,902)

 

(947)

 

(17,902)

 

(947)

 

4,756,166

 

1,854,171

 

4,755,976

 

1,994,295

(Increase) / decrease in trade and other receivables

(9,633)

 

95,063

 

(10,023)

 

34,323

(Decrease) / increase in trade and other payables

(136,145)

 

210,911

 

(129,097)

 

157,628

Increase in provision

153,450

 

76,734

 

153,450

 

76,734

Cash generated from operations

4,763,838

 

2,236,879

 

4,770,306

 

2,262,980

 


This information is provided by RNS, the news service of the London Stock Exchange. RNS is approved by the Financial Conduct Authority to act as a Primary Information Provider in the United Kingdom. Terms and conditions relating to the use and distribution of this information may apply. For further information, please contact rns@lseg.com or visit www.rns.com.
 
END
 
 
FR SFAFWUFUSEDM
Close


London Stock Exchange plc is not responsible for and does not check content on this Website. Website users are responsible for checking content. Any news item (including any prospectus) which is addressed solely to the persons and countries specified therein should not be relied upon other than by such persons and/or outside the specified countries. Terms and conditions, including restrictions on use and distribution apply.

 


Final Results - RNS