Part 3 : For preceding part double-click [nRn2H4314A]
There were no capital commitments as at 31 July 2009 (2008: £nil)
12 DEFERRED TAX
GROUP
2009 2008
£'000 £'000
The deferred tax asset is represented by:
Temporary difference on share based payments
At start of year 292 529
Recognised in income (154) 150
Recognised in equity (39) (387)
At end of year 99 292
The rate of UK corporation tax applied to deferred tax calculations is 28%
(2008: 28%).
13 INVESTMENTS
COMPANY
2009 2008
£'000 £'000
Movement in investment in group companies - Investment in Matchtech 22 0
GmbH
Investment in group companies at end of the year 272 250
Subsidiary Undertakings
Company Country of Incorporation Share Class % held Main Activities
Matchtech Group UK Ltd United Kingdom Ordinary 99.998% Provision of recruitment consultancy
Matchtech Engineering Ltd United Kingdom Ordinary 100% Non trading
Matchmaker Personnel Ltd United Kingdom Ordinary 100% Non trading
Matchtech GmbH Germany Ordinary 100% Provision of recruitment consultancy
14 TRADE AND OTHER RECEIVABLES
GROUP COMPANY
2009 2008 2009 2008
£'000 £'000 £'000 £'000
Trade receivables 32,623 38,298 0 0
Amounts owed by group companies 0 0 2,989 2,880
Other receivables 76 49 0 0
Prepayments 204 218 0 0
Total 32,903 38,565 2,989 2,880
The amount owed to group undertakings in the company balance sheet is considered
to be approximate fair value.
Days sales outstanding at the year end based upon the preceding three months
revenue were 41.7 days (2008: 40.1 days). The allowance for doubtful debts has
been determined by reference to previous experience and management assessment of
debts.
The Directors consider that the carrying amount of trade and other receivables
approximates the fair value.
Included in the Group's trade receivable balance are debtors with a carrying
amount of £2,660,000 (2008: £6,293,000) which are past due at the reporting date
for which the Group has not provided as the Directors do not believe there has
been a significant change in credit quality and consider the amounts to be
recoverable in full. The Group does not hold any collateral over these
balances.
The Group uses a third party credit scoring system to assess the credit
worthiness of potential new customers before accepting them. Credit limits are
defined by customer based on this information. All customer accounts are subject
to review on a regular basis by senior management and actions are taken to
address debt ageing issues.
The Directors believe that there is no requirement for further provision over
and above the allowance for doubtful debts.
Ageing of past due but not impaired trade receivables
2009 2008
£'000 £'000
0-30 days 2,413 5,558
30-60 days 194 619
60-90 days 38 29
90+ days 15 87
2,660 6,293
Movement in the allowance for doubtful debts
2009 2008
£'000 £'000
Balance at the beginning of the period 199 183
Impairment losses recognised 161 16
360 199
Ageing of impaired trade receivables
2009 2008
£'000 £'000
Not past due at reporting date 126 0
0-30 days 68 0
30-60 days 66 0
60-90 days 40 0
90+ days 60 199
360 199
15 TRADE AND OTHER PAYABLES
Group
2009 2008
£'000 £'000
Trade payables 106 149
Taxation and Social Security 2,700 5,049
Other payables 5,326 10,667
Accruals and deferred income 2,801 3,065
Total 10,933 18,930
16 FINANCIAL ASSETS AND LIABILITIES BALANCE SHEET CLASSIFICATION
The carrying amount of Matchtech's financial assets and liabilities as
recognised at the balance sheet date of the reporting periods under review may
also be categorised as follows:
Financial assets are included in the balance sheet within the following
headings:
Group Company
2009 2008 2009 2008
£'000 £'000 £'000 £'000
Trade and other receivables
- Loan and receivables 32,699 38,347 2,989 2880
Cash and cash equivalents
- Loan and receivables 307 297 82 211
Total 33,006 38,644 3,071 3,091
Financial liabilities are included in the balance sheet within the following
headings:
2009 2008
£'000 £'000
Current liabilities
Borrowings
- Financial liabilities recorded at amortised cost 1,470 3,349
Trade and other payables
- Financial liabilities recorded at amortised cost 8,233 13,881
Non current liabilities
Borrowings
- Financial liabilities recorded at amortised cost 0 0
Total 9,703 17,230
The amounts at which the assets and liabilities above are recorded are
considered to approximate to fair value.
The working capital facility is secured by way of an all assets debenture, dated
5 August 2002, which contains fixed and floating charges over the assets of
Matchtech Group UK Limited. The facility held with Barclays Bank allows the
company to borrow up to 90% of its invoiced debtors up to a maximum of £20
million. Interest is charged on borrowings at a rate of 1.0% over Barclays Bank
base rate.
17 COMMITMENTS UNDER OPERATING LEASES
At 31 July 2009 the group had commitments to pay the following amounts under
non-cancellable operating leases as set out below.
Group Company
2009 2008 2009 2008
£'000 £'000 £'000 £'000
At 31 July 2009 the group had commitments to pay the following amounts
undernon-cancellable operating leases as set out below.
Land/buildings Leases falling due: within 1 year 532 532
within 1 to 5 years 1,323 1,523 0 0
after 5 years 784 1,069 0 0
Other Leases falling due: within 1 year 11 3 0 0
within 1 to 5 years 15 9 0 0
The lease on 1400 Parkway, which expires in March 2017 has a break clause
exercisable in June 2011. The payments due have therefore been shown in the
'within 1 year' and 'within 1 to 5 years' categories. There are no applicable
renewal clauses in the current lease agreements.
18 SHARE CAPITAL
Authorised share capital
2009 2008
£'000 £'000
40,000,000 Ordinary shares of £0.01 each 400 400
Allotted, called up and fully paid:
2009 2008
£'000 £'000
23,273,000 (2008: 23,230,000) Ordinary shares of £0.01 each 232 232
The number of shares in issue in the company increased as follows:
Date Ordinary shares issued Share premium received Consideration received
pence per share £
At 01/08/2008 23,029,195
27/08/2007 436 0 4
28/09/2007 447 0 4
31/10/2007 454 0 5
05/11/2007 70,872 89 63,781
23/01/2008 17,131 0 171
08/04/2008 9,174 133 12,293
15/04/2008 4,587 145 6,697
12/05/2008 5,692 145 8,310
05/06/2008 75,336 145 109,991
28/07/2008 16,619 145 24,264
At 31/7/2008 23,229,943 225,520
30/11/2008 3,571 0 36
05/01/2009 2,218 0 22
30/01/2009 2,433 0 24
03/03/2009 2,847 0 28
31/03/2009 3,050 0 31
23/04/2009 19,469 0 195
05/05/2009 3,593 0 36
02/06/2009 2,912 0 29
03/07/2009 2,944 0 29
Total 23,272,980 225,950
Share Options
The following options arrangements exist over the Company's shares.
2009 2008 Date of grant Exercise price
'000s '000s pence
Key Share Options 24 24 18/06/2004 70 18/06/2005 18/06/2014
Key Share Options 0 0 08/11/2004 89 08/11/2005 08/11/2014
Key Share Options 142 142 01/12/2005 146 01/06/2007 01/12/2015
Target/Loyalty Share Options 3 3 05/03/2003 70 14/07/2005 05/03/2013
Target/Loyalty Share Options 2 2 18/06/2004 70 18/06/2005 18/06/2014
Target/Loyalty Share Options 1 2 08/11/2004 89 14/07/2006 08/11/2014
Target/Loyalty Share Options 24 26 01/12/2005 146 01/12/2006 01/12/2015
Long Term Incentive Plan Options 0 260 26/10/2006 1 27/10/2009 27/10/2016
Long Term Incentive Plan Options 0 7 26/01/2007 1 26/01/2010 25/01/2017
Long Term Incentive Plan Options 259 292 15/11/2007 1 15/11/2010 14/11/2017
Long Term Incentive Plan Options 601 0 14/11/2008 1 14/11/2010 13/11/2018
Total 1,056 758
In the year the company operated an EMI Share Option Scheme. No EMI share
options were granted or exercised during the year.
The Group also operates a Long Term Incentive Plan (LTIP). LTIP awards are
nil-cost options granted to senior staff subject to a three year holding period
and the achievement of performance targets. LTIP options have a life of 10
years. The movement of LTIP's in the year are shown below.
2009 2008
Number Weighted average exercise price Weighted average share price Number Weighted average exercise price Weighted average share price
'000s (pence) (pence) '000s (pence) (pence)
Outstanding at 1 August 758 75.6 660 75.6
Granted 662 1.0 302 1.0
Forfeited/ lapsed 364 3.1 33 29.9
Exercised - - 171 122.8 361.0
Outstanding at 31 July 1,056 75.6 758 75.6
Exercisable at 31 July 197 134.3 199 134.2
The number and weighted average exercise price of future share options vesting
in the future are shown below.
2009 2008
Exercise Date Weighted average remaining contract life Number Weighted average exercise price Weighted average remaining contract life Number Weighted average exercise price
(months) '000s (pence) (months) '000s (pence)
27/10/2009 0 0 0.0 15 260 1.0
30/01/2010 0 0 1.0 18 7 1.0
06/11/2010 15 259 1.0 27 292 1.0
14/11/2011 27 601 1.0 0 0 0.0
Total 860 559
The fair values of the LTIPS were calculated using a Monte Carlo simulation
method along with the assumption as detailed in the table below. In the year the
Group operated a Share Incentive Plan (SIP). The SIP is an HMRC approved plan
available to all employees enabling them to purchase shares out of pre-tax
salary. For each share purchased the company grants an additional share at no
cost. The fair values of the SIPS were calculated as the market value on the
date of the grant.
Date of grant Share Price on the date of grant Exercise Price Volatility Vesting Period Dividend Yield Risk Free Rate of interest Fair Value
(£) (£) (%) (yrs) (%) (%) (£)
27/11/2006 SIP 3.67 0.01 N/A 3.00 N/A N/A 3.67
22/12/2006 SIP 3.67 0.01 N/A 3.00 N/A N/A 3.67
30/01/2007 SIP 3.79 0.01 N/A 3.00 N/A N/A 3.79
26/02/2007 SIP 4.02 0.01 N/A 3.00 N/A N/A 4.02
30/03/2007 SIP 4.00 0.01 N/A 3.00 N/A N/A 4.00
27/04/2007 SIP 4.40 0.01 N/A 3.00 N/A N/A 4.40
25/05/2007 SIP 4.75 0.01 N/A 3.00 N/A N/A 4.75
25/06/2007 SIP 4.83 0.01 N/A 3.00 N/A N/A 4.83
27/07/2007 SIP 4.73 0.01 N/A 3.00 N/A N/A 4.73
15/11/2007 LTIP 4.24 0.01 30.1% 3.00 10% 4.6% 2.68
30/08/2007 SIP 4.61 0.01 N/A 3.00 N/A N/A 4.61
28/09/2007 SIP 4.60 0.01 N/A 3.00 N/A N/A 4.60
26/10/2007 SIP 4.69 0.01 N/A 3.00 N/A N/A 4.69
30/11/2007 SIP 4.12 0.01 N/A 3.00 N/A N/A 4.12
02/01/2008 SIP 3.73 0.01 N/A 3.00 N/A N/A 3.73
25/01/2008 SIP 3.58 0.01 N/A 3.00 N/A N/A 3.58
29/02/2008 SIP 3.19 0.01 N/A 3.00 N/A N/A 3.19
28/03/2008 SIP 3.02 0.01 N/A 3.00 N/A N/A 3.02
25/04/2008 SIP 2.88 0.01 N/A 3.00 N/A N/A 2.88
30/05/2008 SIP 2.97 0.01 N/A 3.00 N/A N/A 2.97
27/06/2008 SIP 2.90 0.01 N/A 3.00 N/A N/A 2.90
25/07/2008 SIP 2.68 0.01 N/A 3.00 N/A N/A 2.68
14/11/2008 LTIP 2.17 0.01 17.0% 3.00 7% 2.8% 1.28
30/11/2008 SIP 2.10 0.01 N/A 3.00 N/A N/A 2.10
05/01/2009 SIP 2.02 0.01 N/A 3.00 N/A N/A 2.02
30/01/2009 SIP 1.92 0.01 N/A 3.00 N/A N/A 1.92
03/03/2009 SIP 1.59 0.01 N/A 3.00 N/A N/A 1.59
31/03/2009 SIP 1.52 0.01 N/A 3.00 N/A N/A 1.52
23/04/2009 SIP 1.52 0.01 N/A 3.00 N/A N/A 1.52
05/05/2009 SIP 1.29 0.01 N/A 3.00 N/A N/A 1.29
02/06/2009 SIP 1.44 0.01 N/A 3.00 N/A N/A 1.44
03/07/2009 SIP 1.42 0.01 N/A 3.00 N/A N/A 1.42
31/07/2009 SIP 1.30 0.01 N/A 3.00 N/A N/A 1.30
- The volatility of the Company's share price on each date of grant was
calculated as the average of annualised standard deviations of daily
continuously compounded returns on the Company's stock, calculated over 5 years
back from the date of grant, where applicable.
- The risk free rate is UK risk free rate of appropriate term. Source: Bank of
England website.
- The IFRS2 credit recognised in the income statement for the year ended 31 July
2009 is £155,581, (2008: charge of £538,916). The November 2007 LTIP has been
deemed unlikely to vest due to the growth required in the remaining year being
very challenging in the current economic climate. We have deemed that as the
November 2008 LTIP is only one year through the three year target period, it is
possible that the LTIP will vest in full.
- LTIP awards are subject to a TSR test. This "market" based condition is taken
into account in the date of grant fair value calculation.
19 TRANSACTIONS WITH DIRECTORS AND RELATED PARTIES
There were no material related party transactions with the directors during the
period.
With the exception of dividends paid from Matchtech Group UK Limited to
Matchtech Group PLC of £2,462,000 on 1 December 2008 and £1,163,000 on 17 June
2009 there are no other related party transactions in the company accounts.
20 FINANCIAL INSTRUMENTS
The financial risk management policies and objectives including those related to
financial instruments and the qualitative risk exposure details, comprising
credit and other applicable risks, are included within the Chief Financial
Officer's report under the heading Group financial risk management.
Maturity of financial liabilities
The group financial liabilities analysis at 31July 2009 was as follows:
GROUP COMPANY
2009 2008 2009 2008
£'000 £'000 £'000 £'000
In less than one year or on demand:
Bank overdrafts 0 110 0 0
Working capital facility 1470 3,239 0 0
Trade and other payables 8,233 13,881 0 0
9,703 17,230 0 0
Borrowing facilities
(i) The Group has a revolving credit facility whereby it may borrow up to £7.5
million subject to satisfaction of the requirements of the facility. The
interest rate of the loan is set at 1.1% above the LIBOR lending rate. The
maturity date is set by interest period at the commencement of the loan. Each
advance is repaid on that date but the revolving facility allows any amount
repaid to be available for redrawing.
(ii) The undrawn facility available at 31 July 2009 of the Working Capital
facility in respect of which all conditions precedent had been met was as
follows:
Group
2009 2008
£'000 £'000
Expiring in one year or less 18,530 16,760
The working capital facility is secured on the total assets of the group as
explained in note 16.
The working capital facility was reviewed by the facility providers in September
2009 and renewed for a further twelve months.
The Director's have calculated that the effect on profit of a 1% movement in
interest rates would be £80,000.
The Directors believe that the carrying value of borrowings approximates to
their fair value.
Net foreign currency monetary assets
Group
2009 2008
£'000 £'000
Euros 38 19
21 STANDARDS AND INTERPRETATIONS IN ISSUE, NOT YET EFFECTIVE
The following new Standards and Interpretations, which are yet to become mandatory, have not been applied in the Group financial statements.
Standard Effective date
(Annual periods beginning on or after)
IFRIC 13 Customer Loyalty Programmes 1 January 2009
IFRIC 12 Service Concession Arrangements 30 March 2009
IAS 23 Borrowing Costs (revised 2007) 1 January 2009
IFRS 8 Operating Segments 1 January 2009
IAS 27 Consolidated and Separate Financial Statements (revised 2008) 1 July 2009
IAS 1 Presentation of Financial Statements (revised 2007) 1 January 2009
IAS 32 Financial Instruments: Presentation 1 January 2009
IFRS 2 Share-based Payment - Vesting Conditions and Cancellations 1 January 2009
IFRS 3 Business Combinations (revised 2008) 1 July 2009
IFRS 1 & IAS 27 Consolidated and Separate Financial Statements - Costs of Investment in a 1 January 2009
Subsidiary, Jointly
Controlled Entity or Associate
IAS 39 Amendment - Financial Instruments: Recognition and Measurement - Eligible 1 October 2008
Hedged Items
IFRIC 16 Hedges of a Net Investment in a Foreign Operation 1 October 2009
IFRS7 Financial Instruments - Improving Disclosures 1 January 2009
Based on the Group's current business model and accounting policies, the
Directors does not expect material impacts on the figures in the Group's
financial statements when the interpretations become effective. They do not
anticipate a significant impact on disclosures in the financial statements
arising from IAS1 (Revised 2007) which requires changes to the formats of the
primary statements. IFRS8 requires segmental reporting to be based on the
internal reporting reviewed regularly by the Chief Operating Decision Maker. The
Directors do not expect that the segments presented under this new standard will
differ from those in these financial statements.
The Group does not intend to apply any of these pronouncements early.
22 CAPITAL MANAGEMENT POLICIES AND PROCEDURES
Matchtech Group plc's capital management objectives are:
- to ensure the Group's ability to continue as a going concern; and to provide
an adequate return to shareholders.
- by pricing products and services commensurately with the level of risk.
The Group monitors capital on the basis of the carrying amount of equity as
presented on the face of the balance sheet.
The Group sets the amount of capital in proportion to its overall financing
structure, ie equity and financial liabilities. The Group manages the capital
structure and makes adjustments in the light of changes in economic conditions
and risk characteristics of the underlying assets. Capital for the reporting
period under review is summarised as follows:
2009 2008
£'000 £'000
Total equity 21,235 17,066
Cash and cash equivalents (307) (297)
Capital 20,928 16,769
Total equity 21,235 17,066
Cash and cash equivalents 1,470 3,349
Capital 22,705 20,415
Capital to overall financing ratio 92% 82%
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR CKOKKFBDDPKK