TIDMJSG
RNS Number : 9348D
Johnson Service Group PLC
08 March 2022
8 March 2022
AIM: JSG
Johnson Service Group PLC
('JSG' or 'the Group')
Preliminary Results for the Year Ended 31 December 2021
"Improving volumes and confidence for the longer term"
FINANCIAL PERFORMANCE
-- Total revenue of GBP271.4 million (2020: GBP229.8
million).
-- Adjusted EBITDA(1) of GBP67.9 million (2020: GBP53.6 million)
with margin of 25.0% (2020: 23.3%).
-- Adjusted Profit before Taxation(2) of GBP9.4 million (2020:
Adjusted Loss before Taxation(2,3) GBP16.8 million).
-- Profit before Taxation of GBP5.1 million (2020: Loss before
Taxation(3) GBP32.1 million).
-- Net debt excluding IFRS 16 liabilities at December 2021 of
GBP22.3 million (December 2020: net cash GBP6.6 million) reflecting
increased sales and continuing capital investment.
-- Net debt at December 2021 of GBP60.1 million (December 2020:
GBP33.6 million).
-- As previously guided, no dividend declared in respect of
2021.
-- Strong balance sheet and capacity for further investment.
OPERATIONAL HIGHLIGHTS
-- Workwear continued to service customers throughout the year
with volumes reaching pre-COVID levels in November 2021. Customer
retention levels were 95% for the year.
-- New Workwear site in Exeter opened in September increasing
capacity in the South West by 20%.
-- HORECA sites operated at various levels, peaking at 87% of
normal volume in September 2021.
-- HORECA volumes expected to continue to increase through 2022
following a slow start in January and into February 2022.
-- Further mitigating actions are ongoing to offset cost
pressures.
SUSTAINABILITY
-- Group's targets for 2030, together with objectives and plans
for 2022, published in 'The Johnsons Way' booklet
(www.jsg.com).
-- Our Carbon Trust backed water recycling plant at our
Shaftesbury site is now fully commissioned.
-- Employee Engagement surveys completed and employee discussion
forums planned.
Notes
1 Adjusted EBITDA refers to operating profit/(loss) before
amortisation of intangible assets (excluding software amortisation)
and exceptional items (defined as 'Adjusted Operating
Profit/(Loss)') plus the depreciation charge for property, plant
and equipment, textile rental items and right of use assets plus
software amortisation.
2 Adjusted Profit before Taxation or Adjusted Loss before
Taxation refers to Adjusted Operating Profit/(Loss) less total
finance costs.
3 Results for 2020 have been restated following a change in
accounting policy for costs associated with cloud-based computing
which has been applied as a prior year adjustment.
Peter Egan, Chief Executive Officer of Johnson Service Group,
commented:
"These results represent a solid performance from the Group
against the challenging background of the COVID-19 pandemic and its
impact, particularly on the hospitality sector. We saw a strong
recovery of HORECA volumes through the second half of 2021 up until
the last two weeks of December when volumes fell. This reduction in
December continued into the start of 2022, impacting both revenue
and margins in Q1, although volumes in HORECA have shown signs of
recovery in recent weeks. Workwear volumes have remained consistent
throughout 2021, recovering to pre-pandemic levels by the end of
the year.
During the year we have continued to invest in our systems,
sites, people and initiatives to expand our sales offering and
maintain our high quality of service.
With the strength and resilience of our teams, alongside the
mitigating actions we continue to take, we anticipate that HORECA
volumes during 2022 will, in the absence of any further
restrictions, increase towards 2019 levels. Cost pressures
experienced in the final quarter are continuing and further
mitigating actions are ongoing.
We remain very confident that the business is well positioned
for growth in the medium to long term."
SELL-SIDE ANALYSTS' MEETING
A virtual presentation for sell-side analysts will be held today
at 9.30am, details of which will be distributed by Camarco. A copy
of the presentation will be available on the Company's website (
www.jsg.com ) following the meeting.
ENQUIRIES
Johnson Service Group PLC
Peter Egan, CEO
Yvonne Monaghan, CFO
Tel: 020 3757 4992/4981 (on the day)
Tel: 01928 704 600 (thereafter)
Investec Investment Banking (NOMAD) Camarco (Financial PR)
David Flin Ginny Pulbrook
Carlton Nelson Rosie Driscoll
Virginia Bull Toby Strong
Tel: 020 7597 5970 Tel: 020 3757 4992/4981
CHIEF EXECUTIVE'S OPERATING REVIEW
BASIS OF PREPARATION
Throughout this statement, and consistent with prior years,
underlying and other alternative performance measures are used to
describe the Group's performance. These are not recognised under
International Financial Reporting Standards. The Board manages and
assesses the performance of the Group on these measures and
believes they are more representative of ongoing trading,
facilitate meaningful year on year comparisons, and hence provide
more useful information to Shareholders. Underlying and other
alternative performance measures, which include adjusted operating
profit/(loss), adjusted profit/(loss) before taxation, adjusted
EBITDA and adjusted EPS are defined within the Financial Review and
are reconciled to statutory reporting measures in notes 5 and
8.
TRADING PERFORMANCE
Revenue
Our 2021 results reflect the continuing impact that COVID-19 has
had on the Group, particularly within our HORECA division. T otal
revenue for the year to 31 December 2021 was GBP271.4 million
(2020: GBP229.8 million).
Financial Results
Adjusted EBITDA was GBP67.9 million (2020: GBP53.6 million)
giving a margin of 25.0% (2020: 23.3%). As expected, we saw this
improve from the 17% achieved in the first half of the year.
Adjusted operating profit was GBP12.7 million (2020: GBP11.9
million loss).
The Group continued to utilise the Coronavirus Job Retention
Scheme ("CJRS") in the first half of the year, and this amounted to
GBP9.9 million (year to 31 December 2020: GBP28.2 million). GBP11.6
million (2020: GBP26.5 million) was received in cash during the
year. No CJRS claims were made in respect of the second half of
2021.
Total finance cost reduced to GBP3.3 million (2020: GBP4.9
million). The year to December 2020 included a charge of GBP0.6
million relating to the discontinuance of hedge accounting on
interest rate swaps previously designated as cash flow hedges.
Profit before taxation, after amortisation of intangibles
(excluding software amortisation) of GBP11.0 million (2020: GBP11.0
million) and an exceptional credit of GBP6.7 million (2020:
exceptional charge of GBP4.3 million) was GBP5.1 million (2020:
GBP32.1 million loss).
Adjusted diluted earnings per share was 2.2 pence (2020:
adjusted diluted loss per share 3.3 pence).
The adjusted diluted earnings per share in 2021 includes the
benefit of the capital allowances super deduction which offers 130%
first year relief on qualifying capital spend. Excluding this
benefit, which is a temporary impact, adjusted diluted earnings per
share was 1.7 pence.
Dividend
A dividend is not being proposed in respect of 2021. The Board
is aware of the importance of dividends to Shareholders and will
look to reinstate its dividend policy once there is more certainty
that trading levels will return to, and remain at, more normal
levels.
OPERATIONAL REVIEW
Our Businesses
The Group comprises of Textile Rental businesses which trade
through a number of very well recognised brands, servicing the UK's
Workwear and HORECA (Hotel, Restaurant and Catering) sectors. The
'Johnsons Workwear' brand predominantly provides workwear rental
and laundry services to corporates across all industry sectors.
Within HORECA, 'Stalbridge' and 'London Linen' provide premium
linen services to the restaurant, hospitality and corporate events
market and Johnsons Hotel Linen, our high volume linen business
which also incorporates the recently acquired Lilliput (Dunmurry)
Limited, primarily serves the corporate four-star and budget hotel
market.
Our management teams and employees at all levels have risen to
the challenges presented through the COVID-19 pandemic. We have
continued to adapt our processes and procedures where necessary to
ensure availability of our services and to manage the health,
safety and well-being of our employees.
In line with all UK businesses cost pressures have impacted the
Group, particularly in the final quarter.
Constructive commercial discussions have taken place with
customers relating to the significant increases in our business
costs. Our National Accounts and Service teams have achieved
success in retaining key customers and continue to build strong
business relationships. We continue to benefit from ongoing sales
and referrals for new business, especially within HORECA from new
build hotels, where the strength of our longstanding reputation for
service and quality continue to help us win additional new business
from current and new customers.
Workwear Division
Operating as Johnsons Workwear, we provide workwear rental and
laundry services to some 36,000 customers in the UK, ranging from
small local businesses to the largest companies covering food
related and other industrial sectors.
The total revenue for the Workwear division was GBP128.9 million
(2020: GBP129.5 million). Adjusted EBITDA was GBP46.3 million
(2020: GBP48.7 million) with a margin of 35.9% (2020: 37.6%).
Adjusted operating profit was GBP22.5 million (2020: GBP23.5
million).
Despite the disruption of further lockdowns and restrictions,
our diverse customer base helped to bring stability within the
division. With a significant percentage of our customers remaining
open, our garment processing volumes remained relatively consistent
throughout the year and ended the year in line with pre-COVID
normalised levels.
We continued to react to the ever-changing market conditions,
which culminated in an improvement in our customer focused key
performance indicators. Our independent annual customer
satisfaction survey resulted in us achieving 86.4%, our highest
result ever, and placing us in the upper quartile of company
satisfaction ratings. Our customers were very complimentary about
the consistency and quality of service we provided, allowing them
to focus on their core business. This also resulted in us achieving
our highest net promoter results. The customer service teams
remained focused and actively engaged with our customers, with
service sales continuing to remain buoyant. The return of the sales
team in May 2021 resulted in an increase in activity, as they
continued to develop their pipelines and identified new
opportunities within the various market sectors. Customer retention
remained high at 95%.
To complement our current accreditations, we have successfully
implemented EN 14065 into our operating plants and procedures. This
will enable us to proactively focus on new emerging sectors within
the workwear market. To support the sales and service teams, new
product ranges were introduced to enhance our existing garment
offering. Our dynamic garment catalogue was refreshed with a more
modern feel and look, and converted into an electronic version,
giving the service and sales teams a more interactive platform to
present our product range to the customer. The new product
development team, in conjunction with key suppliers, proactively
introduced several new key product ranges suitable for the
healthcare and pharmaceutical market sectors. The development of a
more sustainable and recyclable garment was presented to the
business and will be introduced into our garment portfolio shortly.
We remain focused on the drive to supply more stock-supported
garments, which will significantly improve the garment lead time to
our customers.
Following our Employee Engagement survey in 2019, we
commissioned a further survey in September 2021 resulting in an
improved engagement score of 83%. We received positive feedback on
diversity and inclusion and identified both good relationships
within the teams and an excellent understanding of the impact of
our employees on our quality of service to our customers. Continued
development is planned that will enhance the employee engagement
experience even further. The Johnsons Academy will continue to
provide a development and progression strategy for our
employees.
Our new plant in Exeter was successfully commissioned in
September 2021. The automated operating systems provide market
leading technology and improved efficiencies, and will increase our
capacity in the South West by 20%. A significant capital investment
programme, focusing on automated upgrades in Perth and Hinckley was
undertaken and similar upgrades are being commissioned at other
sites. Automation and best in class equipment will continue to form
the foundation of our investment strategy.
HORECA Division
The total revenue for the HORECA division was GBP142.5 million
(2020: GBP100.3 million). Adjusted EBITDA was GBP26.2 million
(2020: GBP8.7 million) with a margin of 18.4% (2020: 8.7%).
Adjusted operating loss was GBP5.2 million (2020: GBP31.5
million).
The division was impacted significantly by business closedowns
early in 2021. However, there was a strong recovery in the second
half of 2021, in line with the hospitality market across the
country. Volumes increased during the summer, peaking at 87% of
normal in September 2021, before falling in the final two weeks of
the year to 60% of normal.
As hospitality businesses re-opened, initial shortages in
resources within Stalbridge and London Linen caused supply issues
in some of our factory locations. Our operational and service teams
responded magnificently under great pressure to ensure service
levels returned to our normal high standards as quickly as
possible, and our resultant customer survey scores remained high at
84.4%, despite some of the challenges experienced in the height of
the summer.
In response to the volatile employment market, we adopted
multiple recruitment strategies to attract new employees and
introduced new incentives to retain our existing well trained and
loyal workforce. In response to the national driver shortage, we
started recruiting both internal and external candidates for HGV
training with some success. The Employee Engagement score was 79%,
with a high score for employee diversity and customer focus. The
survey has also identified areas for us to improve in 2022.
We mobilised strategic marketing campaigns, to coincide with
hospitality reopening, focusing on areas where the opportunity for
additional volume was greatest. This has resulted in a significant
number of new sales wins in the second half of 2021, boosting
laundry revenue where capacity was available. The outlook continues
to be positive as the sales pipeline remains strong.
New boiler installations during 2021 in Glasgow and Milborne
Port will deliver more efficient steam generation, whilst a
complete re-wire of our Grantham factory will also reduce utility
consumption. New ironing lines installed in Sturminster Newton and
London Linen will maintain and improve quality, replacing obsolete
and high maintenance machinery. Investment in an improved sortation
system, unloading areas and additional yard space at Redruth will
improve workflow and reduce manual handling.
Our Carbon Trust backed water recycling plant, installed in our
Shaftesbury factory, is now fully commissioned, and is returning a
significant amount of reclaimed water. We have also completed a
successful trial of paper band wrapping on selected linen products,
reducing our reliance on plastic wrap, and we will continue to roll
this out across the hotel, restaurant and catering estate.
Our Hotel Linen business, which primarily serves the corporate
four-star and budget hotel marketplace, experienced significant
incremental demand when hospitality opened in May 2021 and
initially caused some service challenges. Our service levels were
quickly returned to normal levels as demand peaked over the summer.
The impact of the Government's introduction of 'Plan B' in December
significantly reduced volumes for the last two weeks of the
year.
Competition for new employees strengthened during our peak
summer period, resulting in increased costs of production.
Operating procedures were revisited aligning with Government
guidelines to ensure the health, safety and welfare of everyone in
our division. The first independent Employee Engagement Survey for
the Hotel Linen business was completed in November measuring
engagement, enablement and empowerment. A strong response from the
workforce resulted in an encouraging engagement score of 83%.
The senior management team has been strengthened with the
appointment of a Project Manager, National Transport Manager and
Learning and Development Manager. All three appointments were
current employees who were able to develop their careers within our
business and all three will play pivotal roles in the further
development of our people, service and operations.
Our service teams are now back to pre-pandemic staffing levels,
providing field and office support to all our customers. The new
web-based customer portal is currently undergoing user testing with
a view to rolling it out in the second quarter of 2022. This will
automate our linen management process, providing customers with
online linen ordering, training videos, useful service information
and business intelligence reporting. The portal will be
complemented with an app-based customer feedback tool later in the
year.
Despite the volatility in the hospitality market created by the
pandemic, a Customer Satisfaction Survey was undertaken with a
score of 84.2%. This survey provides useful customer feedback which
will be incorporated into future planned enhancements to our
products and services.
Our new GBP10.0 million production facility in Leeds is fully
operational, increasing processing capacity across the Yorkshire
and North East markets. Whilst employees transferred from our
existing depot in Leeds, we also welcomed a large number of new
employees to the business. We continue to invest in new equipment
with a GBP4.1 million upgrade of our largest facility in Bourne,
Lincolnshire which will improve working processes and underpin
capacity. The project will be delivered in time for the busier
spring and summer volume.
The Lilliput laundry business based in Belfast, Northern Ireland
joined our division following acquisition in September and we look
forward to the future of working together and integrating the
business into the wider Hotel Linen business. Investment of GBP4.0
million into the site is underway and will be completed during the
second quarter.
Ongoing Impact of COVID-19
During the first two months of 2022 we have continued to see the
impact of the various restrictions on our business, particularly in
HORECA. Volumes during January in HORECA were some 70% of normal
with an improvement to 85% during February as further restrictions
have been lifted. We expect this improvement to continue in the
coming months.
System Development
The installation of the new laundry management system within our
Hotel Linen plants is almost complete and the installation into
Workwear plants is ongoing. The new system in Workwear will allow
us to improve the customer experience and further develop our
operational functionality to maintain our place as the number one
Workwear provider in the UK.
ENVIRONMENTAL & SOCIAL RESPONSIBILITY
The Board, as a whole, has overall responsibility for
environmental, social and governance matters and we recognise our
duty to stakeholders to operate the business in an ethical and
responsible manner. We are committed to developing our
environmental and social responsibility agenda, recognising that it
can play a major part in leading and influencing all of our people
and operations.
The Board appointed a Head of Sustainability in April 2021 with
the initial remit of reviewing current practices and helping to
develop our sustainability strategy.
We have recently published the Group's targets for 2030 together
with our objectives and plans for 2022 in 'The Johnsons Way'
booklet, which can be found on our website at www.jsg.com.
We are committed to reducing our impact on the environment by
becoming a positive force for environmental stewardship and
incorporating environmental considerations in all our
decision-making processes. Working in conjunction with our
customers and suppliers, we intend to reduce our carbon footprint
by reducing our natural resource consumption and eliminating waste
from our process streams. Our behavioral changes will be the key to
our success. By accepting the need for change we have embarked upon
a collective approach to eliminate single use plastics, reduce
emissions and responsible procurement.
Further details of our ongoing initiatives, together with
actions for the future, will be set out within the Group's 2021
Annual Report.
EMPLOYEES
Our employees are the foundation of our business and 2021 has
been another challenging year for each and every one of them. The
continuing and unpredictable impact of COVID-19 has once again
tested the strength, resilience and adaptability of our teams and
they have worked tirelessly to ensure that we continue to provide
market leading customer service.
We have conducted an Employee Engagement survey in both
divisions and each of our management teams are launching various
initiatives.
We are supporting any employees that are affected by the
conflict in Ukraine and facilitating employee fundraising as part
of the 'Our Communities' pillar.
The Board would like to thank all of our employees for their
support, hard work and significant contribution to the business
through these difficult times.
BOARD CHANGES
Jock Lennox was appointed to the Board on 5 January 2021 as an
Independent Non-Executive Director and Chairman Designate and
stepped into the role as Chairman following the retirement of Bill
Shannon in May 2021.
OUTLOOK
We remain confident in our medium and long-term growth
prospects. Workwear volumes have remained consistent. We have
continued to recruit new employees in the HORECA division and have
therefore carried additional cost through the winter months, which
will impact margin in Q1 but will enable us to meet demand in the
coming months. Whilst volumes in HORECA have shown signs of
recovery in recent weeks the lower than expected volumes in January
and February 2022 has resulted in revenue being some GBP3.0 million
lower. In the absence of further restrictions, or any impact
arising from the conflict in Ukraine, we expect volumes to continue
to build during 2022 to 2019 levels.
The cost pressures we have experienced in the final quarter are
continuing but we have some protection through the fixing of a
proportion of our energy costs for 2022 and into 2023. Further
mitigating actions are ongoing. We anticipate our EBITDA margin
will continue to improve towards pre-COVID levels as we progress
through the year.
We are continuing to focus on delivering outstanding customer
service and investing in both our employees and our laundry
facilities.
Peter Egan
Chief Executive Officer
7 March 2022
FINANCIAL REVIEW
FINANCIAL RESULTS
T otal revenue for the year to 31 December 2021 increased to
GBP271.4 million (2020: GBP229.8 million).
Adjusted EBITDA was GBP67.9 million (2020: GBP53.6 million)
giving a margin of 25.0% (2020: 23.3%) and, in-line with management
expectations, improving from the 17.0% margin achieved in the first
half of 2021. The result includes the benefit of Government support
under the CJRS amounting to GBP9.9 million in the first half of
2021 (2020: GBP28.2 million full year).
The analysis of the Group results across the segments shows the
impact of the pandemic on the adjusted EBITDA of our different
divisions:
2021 2020
-------------------------------- --------------------------------
Adjusted Adjusted
Revenue EBITDA Margin Revenue EBITDA Margin
GBPm GBPm % GBPm GBPm %
Workwear 128.9 46.3 35.9 129.5 48.7 37.6%
HORECA 142.5 26.2 18.4 100.3 8.7 8.7%
Central Costs - (4.6) - - (3.8) -
--------------- ---------- --------- --------- ---------- --------- ---------
Group 271.4 67.9 25.0% 229.8 53.6 23.3%
--------------- ---------- --------- --------- ---------- --------- ---------
The statutory operating profit was GBP8.4 million (2020: GBP27.2
million loss) whilst adjusted operating profit was GBP12.7 million
(2020: GBP11.9 million loss).
The total finance cost was GBP3.3 million (2020: GBP4.9 million)
and included GBP1.5 million (2020: GBP3.1 million) of bank interest
and hedging costs, GBP1.6 million (2020: GBP1.7 million) of
interest in respect of IFRS 16 liabilities and GBP0.2 million
(2020: GBP0.1 million) in respect of notional interest on pension
liabilities.
A net exceptional credit of GBP6.7 million (2020: GBP4.3 million
charge) comprises the recognition of GBP5.9 million of insurance
proceeds relating to further interim payments for capital items and
property costs in relation to the 2020 Exeter plant fire and a
final settlement in respect of the Treforest flood, costs of GBP0.6
million in relation to the demolition of the Exeter site, GBP0.1
million costs in relation to business acquisitions and a GBP1.5
million receipt in respect of outstanding Parent Company
Guarantees. Further insurance receipts of at least GBP0.8 million
are expected to be received in 2022 as the insurance claim for
Exeter is finalised with the insurer.
Adjusted profit before taxation was GBP9.4 million (2020:
GBP16.8 million loss). Statutory profit before taxation, after
amortisation of intangible assets (excluding software amortisation)
of GBP11.0 million (2020: GBP11.0 million) and an exceptional
credit of GBP6.7 million (2020: GBP4.3 million charge), was GBP5.1
million (2020: GBP32.1 million loss).
Adjusted diluted earnings per share was 2.2 pence (2020:
Adjusted diluted loss per share of 3.3 pence). Excluding the impact
of the capital allowances super deduction the adjusted diluted
earnings per share was 1.7 pence.
PRIOR PERIOD RESTATEMENT
Following recent IFRIC guidance issued in 2021 regarding
accounting for cloud-based computer arrangements under IAS38, we
have reviewed the accounting for costs incurred in respect of the
configuration and customisation of cloud-based software
arrangements implemented across the Group. We have costs that have
previously been capitalised which, in light of the revised
guidance, do not meet the requirements of IAS38 and have therefore
been applied as a change in accounting policy under IAS8. As all
costs were capitalised prior to 1 January 2020, brought forward
reserves have been reduced by GBP1.1 million, and the intangible
asset no longer recognised on the Balance Sheet. The amortisation
charged to the Income Statement in the year ended 31 December 2020
was GBP0.2 million and has been reversed. The adjusted operating
loss, adjusted loss before tax and adjusted loss per share have
each been restated to reflect this change (see note 21). All
adjustments are in respect of the Workwear segment.
FINANCING
Total net debt (excluding IFRS 16 liabilities) at the end of the
year was GBP22.3 million (December 2020: net cash GBP6.6 million)
with the increase in debt largely explained by a return to more
normalised levels of working capital and continued investment in
expanding our laundry facilities. Including IFRS 16 liabilities,
net debt at December 2021 was GBP60.1 million (December 2020:
GBP33.6 million).
The Group remains well funded with access to a committed
revolving credit facility of GBP135.0 million which matures in
August 2023. The additional GBP40.0 million facility which
originally ran to May 2022 was cancelled by the Group in February
2022. The remaining facility is considerably in excess of our
anticipated level of borrowings. We anticipate that the facility
will be renewed in the coming months and have commenced discussions
with our banks to this effect.
Bank covenants comprise gearing and interest cover tests. With
effect from March 2022, gearing, for bank purposes, is calculated
as Adjusted EBITDA compared to total debt, including IFRS 16
liabilities, and the agreed covenant is for the ratio to be not
more than three times. Interest cover compares Adjusted EBIT to
total interest cost with a minimum covenant ratio of three times at
March 2022 and rising to four times thereafter. The covenants
provide significant headroom on our current scenario planning.
Interest payable on bank borrowings is based upon SONIA (LIBOR
for loans drawn prior to 1 July 2021) plus a margin of 2% from July
2020 to March 2022. Thereafter, the margin will be linked to our
gearing covenant and will range from 1.25% to 2.25%.
TAXATION
The tax rate on adjusted profit/(loss) before taxation,
excluding exceptional items and the amortisation of intangible
assets (excluding software amortisation), was (5.3)% (2020: 18.5%).
The tax credit arises as a result of tax losses brought forward
from 2020 together with the impact of the super deduction in
respect of allowances on capital spend introduced in April 2021.
The impact of this super deduction in 2021 is a GBP2.5 million
credit to corporation tax.
A tax refund of GBP0.5 million (2020: payment of GBP3.4 million)
was received during the year in respect of tax losses in 2019. Due
to the impact of both tax losses carried forward and the continuing
impact of the capital allowance super deduction we are not
expecting to pay corporation tax in respect of 2022. A tax refund
in respect of 2020 losses carried back to previous years of some
GBP3.5 million is expected in the first half of 2022.
DIVID
It is not proposed to declare a dividend in respect of 2021. The
Board is aware of the importance of dividends to its Shareholders
and will look to reinstate its dividend policy once there is more
certainty that trading levels will return to, and remain at, more
normalised levels.
CASH FLOW
Free cash flow in the year was GBP41.6 million compared to
GBP65.8 million in 2020. Of this, we invested GBP24.4 million
(2020: GBP21.4 million) in the purchase of property, plant and
equipment and software, largely on projects that had already been
committed before the impact of the pandemic was known. Offsetting
this spend was GBP5.3 million (2020: GBP2.5 million) received as
part of the insurance claim in respect of capital items.
Free cash flow in 2021 was impacted by the expected net working
capital outflow of GBP18.3 million (2020: GBP24.4 million inflow),
largely reflective of an increase in trade receivables, as HORECA
volumes recovered, and the payment of GBP10.6 million of VAT,
originally due in April 2020, and paid in the year to December
2021. This outflow is as expected and largely reverses the inflow
in 2020.
INVESTMENT IN TEXTILE RENTAL ITEMS
Spend on textile rental items amounted to GBP41.8 million (2020:
GBP28.1 million). The significant increase reflects the impact of
the pandemic on volumes processed in 2020 and the recovery in 2021.
We have continued to work with our chosen workwear and linen
suppliers to ensure both are available on a timely basis and this
proved beneficial to ensure stock availability during the peak
summer months.
CAPITAL INVESTMENT
We have continued to invest in plant and equipment, spending
GBP24.2 million in the year plus a further GBP0.2 million on
software. Of this, GBP2.1 million was in respect of the final spend
on the new Leeds high volume linen site. Spend on the new Exeter
Workwear plant in 2021 amounted to GBP10.0 million, and was largely
financed by insurance proceeds.
Work started on upgrading our largest Hotel Linen plant in
Bourne with spend of GBP3.1 million in 2021 with the balance to be
spent in 2022.
The acquisition of Lilliput (Dunmurry) Ltd on 30 September 2021
continues our strategy of expanding our geographical coverage. We
have finalised plans to initially invest GBP4.0 million at this
site to improve workflow, efficiency, and capacity.
DEFINED BENEFIT PENSION SCHEME LIABILITIES
As at 31 December 2021, the Scheme's assets had reduced by
GBP5.5 million, to GBP221.2 million, after paying out benefits of
GBP10.5 million during the year. The net deficit, including
deferred taxation, has, reduced to GBP0.9 million (2020: GBP11.2
million) due largely to an increase in the discount rate utilised
in deriving the value of scheme liabilities offset by an increase
in the inflation assumption.
We have agreed with the Trustee that the existing deficit
recovery payment of GBP1.9 million per annum will continue in equal
monthly instalments until the next review following the completion
of the triennial valuation as at 30 September 2022.
Clearly, the deficit calculated under both the provisions of
IAS19 and under the statutory funding objective is sensitive to
changes in the discount rate, based on corporate bond or gilt
yields as appropriate. The asset allocation of the Scheme is kept
under review so that the impact of a reduction in the discount rate
and an increase in inflation or interest rates is, at least in
part, offset by a corresponding increase in asset values. In
addition, the review also considers alternative asset classes which
earn a reasonable level of return but with lower volatility and
therefore a reduction in risk. Appropriate changes to the
investment allocation have been implemented in order to achieve
these goals. The Scheme has fully divested of its direct equity
investments.
BALANCE SHEET AND CAPITAL STRUCTURE
The Group maintains a strong Balance Sheet, with net assets
having increased to GBP272.4 million (2020: GBP254.6 million).
As previously mentioned, gearing, for bank purposes will, from
March 2022, be calculated as adjusted EBITDA compared to total
debt, including IFRS 16 liabilities, and the agreed covenant is for
the ratio to be not more than three times. The Group's medium to
long-term intention is to return the capital structure such that we
operate between one and two times on this basis, other than for
short term specific exceptions. Under this framework, our capital
allocation policy remains unchanged and will take into account the
following criteria as part of a periodic review of capital
structure:
-- maintaining a strong balance sheet;
-- continuing capital investment to increase processing capacity
and efficiency;
-- appropriate accretive acquisitions;
-- operating a progressive dividend policy; and
-- distributing any surplus cash to Shareholders.
GOING CONCERN
Since the start of the pandemic in March 2020 the Group has
reacted quickly and decisively, implementing a range of prudent
cost management and cash preservation actions, securing additional
funding facilities, revising bank covenants and raising equity in
order to protect the business from any potential adverse
impact.
The current and plausible future impact of COVID-19 and the
related macroeconomic environment on the Group's activities and
performance has been considered by the Board in preparing its going
concern assessment. The Group has prepared a base case scenario,
reflecting an initial set of assumptions around financial
projections and trading performance, together with various, more
pessimistic, expectations for market developments over the
remainder of 2022 and into 2023 to reflect subdued trading
conditions.
After considering the financial scenarios, the severe but
plausible sensitivities and the facilities available to the Group,
the Directors have a reasonable expectation that the Group has
adequate resources for its operational needs, will remain in
compliance with the financial covenants in its bank facilities and
will continue in operation for at least the period to 30 June 2023.
As a consequence, and having reassessed the principal risks and
uncertainties, the Directors considered it appropriate to adopt the
going concern basis in preparing the consolidated financial
statements.
KEY PERFORMANCE INDICATORS ('KPIs')
The main KPIs used as part of the assessment of performance of
the Group, and of each segment, are growth in revenue, adjusted
EBITDA margin, adjusted operating profit/(loss) and adjusted
diluted earnings/(loss) per share from Continuing Operations. In
addition, for years 2021, 2022 and 2023, the adjusted diluted
earnings per share excluding the impact of the capital allowance
super deduction will also form part of the assessment.
Non-financial KPIs, as referred to within the Chief Executive's
Operating Review, include our employee and customer survey results
and customer retention statistics.
ALTERNATIVE PERFORMANCE MEASURES (APMs)
Throughout the Statement we refer to a number of APMs. APMs are
used by the Group to provide further clarity and transparency of
the Group's underlying financial performance. The APMs are
'adjusted operating profit/(loss)' which refers to continuing
operating profit/(loss) before amortisation of intangible assets
(excluding software amortisation) and exceptional items, 'adjusted
profit/(loss) before taxation' which refers to adjusted operating
profit/(loss) less total finance cost, 'adjusted EBITDA' which
refers to adjusted operating profit/(loss) plus the depreciation
charge for property, plant and equipment, textile rental items and
right of use assets plus software amortisation and 'adjusted EPS'
which refers to EPS calculated based on adjusted profit/(loss)
after taxation. An additional measure has been introduced for 2021
to state a further 'adjusted EPS excluding super deduction' which
amends the 'adjusted EPS' to exclude the short term benefit of the
capital allowance super deduction.
The Board considers that 'adjusted operating profit/(loss)',
'adjusted profit/(loss) before taxation', 'adjusted EBITDA' and
'adjusted EPS', all of which exclude the effects of non-recurring
items or non-operating events, provide useful information for
Shareholders on the underlying trends and performance of the
Group.
SUMMARY
The strategy of the Group is unchanged and remains to continue
to expand our Textile Services business through targeted capital
investment, organic growth and acquisition. We have a strong
balance sheet to support this strategy with future funding in place
to finance planned investment.
Yvonne Monaghan
Chief Financial Officer
7 March 2022
CONSOlidated Income Statement
Year ended Year ended
31 December 31 December
2021 2020
Note GBPm GBPm
Restated*
Revenue 2 271.4 229.8
Impairment loss on trade receivables** (0.4) (3.6)
All other costs (262.6) (253.4)
--------------------------------------------------- ---- --------------------- ------------
Operating profit / (loss) 2 8.4 (27.2)
Operating profit / (loss) before amortisation
of intangible assets
(excluding software amortisation) and exceptional
items 2 12.7 (11.9)
Amortisation of intangible assets (excluding
software amortisation) (11.0) (11.0)
Exceptional items 3 6.7 (4.3)
Operating profit / (loss) 2 8.4 (27.2)
Finance cost 4 (3.3) (4.9)
--------------------------------------------------- ---- --------------------- ------------
Profit / (loss) before taxation 5.1 (32.1)
Taxation credit 6 1.8 5.2
--------------------------------------------------- ---- --------------------- ------------
Profit / (loss) for the year from continuing
operations 6.9 (26.9)
--------------------------------------------------- ---- --------------------- ------------
Loss for the year from discontinued operations (0.3) -
--------------------------------------------------- ---- --------------------- ------------
Profit / (loss) for the year attributable to
equity holders 6.6 (26.9)
--------------------------------------------------- ---- --------------------- ------------
* See note 21 for further details of the prior
year restatement.
** Prior year presentation has been changed
to be compliant with IAS 1.
EARNINGS / (LOSS) PER SHARE (Restated) 8
Basic earnings / (loss) per share
- From continuing operations 1.6p (6.5)p
- From discontinued operations (0.1)p -
--------------------------------------------------- ---- --------------------- ------------
From total operations 1.5p (6.5)p
--------------------------------------------------- ---- --------------------- ------------
Diluted earnings / (loss) per share
- From continuing operations 1.6p (6.5)p
- From discontinued operations (0.1)p -
--------------------------------------------------- ---- --------------------- ------------
From total operations 1.5p (6.5)p
--------------------------------------------------- ---- --------------------- ------------
See note 8 for further details of Adjusted earnings / (loss) per
share and Adjusted diluted earnings / (loss) per share.
Consolidated Statement of COMPREHENSIVE Income
Year ended Year ended
31 December 31 December
2021 2020
Restated
Note GBPm GBPm
Profit / (loss) for the year 6.6 (26.9)
--------------------------------------------------------------------------------- ------- ------ ------------
Items that will not be subsequently
reclassified to profit or loss
Re-measurement and experience gains / (losses)
on post-employment benefit obligations 15 11.0 (9.4)
Taxation in respect of re-measurement
and experience (gains) / losses (2.1) 1.7
Change in deferred tax due to change
in tax rate - 0.2
Items that may be subsequently reclassified
to profit or loss
Cash flow hedges (net of taxation)
- fair value gains / (losses) 1.3 (2.9)
- transfers to
administrative
expenses - 1.8
- transfers to
finance cost - 0.6
--------------------------------------------------------------------------- --- -------- ------ ------------
Total other comprehensive income
/ (loss) for the year 10.2 (8.0)
Total comprehensive income / (loss)
for the year 16.8 (34.9)
--------------------------------------------------------------------------------- ------- ------ ------------
CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS' EQUITY
Capital
Share Share Merger Redemption Hedge Retained Total
Capital Premium Reserve Reserve Reserve Earnings Equity
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
Balance at 31 December
2019 (as previously
reported) 37.0 16.1 1.6 0.6 (0.5) 152.7 207.5
Prior year adjustment
(note 21) - - - - - (1.1) (1.1)
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Restated balance as
at 1 January 2020 37.0 16.1 1.6 0.6 (0.5) 151.6 206.4
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Loss for the year (as
previously reported) - - - - - (27.1) (27.1)
Prior year adjustment - - - - - 0.2 0.2
Other comprehensive
loss - - - - (0.5) (7.5) (8.0)
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Total comprehensive loss
for the year - - - - (0.5) (34.4) (34.9)
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Share options (value
of employee services) - - - - - 0.4 0.4
Deferred tax on share
options - - - - - (0.2) (0.2)
Issue of share capital 7.4 0.2 - - - 75.3 82.9
Transactions with Shareholders
recognised directly
in Shareholders' equity 7.4 0.2 - - - 75.5 83.1
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Balance at 31 December
2020 (Restated) 44.4 16.3 1.6 0.6 (1.0) 192.7 254.6
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Balance at 31 December
2020 (as previously
reported) 44.4 16.3 1.6 0.6 (1.0) 193.6 255.5
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Prior year adjustment
(note 21) - - - - - (0.9) (0.9)
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Balance at 31 December
2020 (Restated) 44.4 16.3 1.6 0.6 (1.0) 192.7 254.6
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Profit for the year - - - - - 6.6 6.6
Other comprehensive
income - - - - 1.3 8.9 10.2
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Total comprehensive
income for the year - - - - 1.3 15.5 16.8
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
Share options (value
of employee services) - - - - - 0.5 0.5
Purchase of own shares
by EBT - - - - - (0.1) (0.1)
Issue of share capital 0.1 0.5 - - - - 0.6
Transactions with Shareholders
recognised directly
in Shareholders' equity 0.1 0.5 - - - 0.4 1.0
--------------------------------- ----- --------- --------- ------------ --------- ---------- ----------
Balance at 31 December
2021 44.5 16.8 1.6 0.6 0.3 208.6 272.4
--------------------------------- ----- --------- --------- ------------ --------- ---------- --------
The Group has an Employee Benefit Trust (EBT) to administer
share plans and to acquire shares, using funds contributed by the
Group, to meet commitments to employee share schemes. At 31
December 2021 the EBT held 9,024 shares (2020: 8,388).
Consolidated Balance Sheet
As at As at
31 December 31 December
2021 2020
Restated
Note GBPm GBPm
Assets
Non-current assets
Goodwill 135.2 130.9
Intangible assets 9 16.7 26.5
Property, plant and equipment 10 113.3 107.2
Right of use assets 11 35.5 38.5
Textile rental items 12 48.4 35.6
Trade and other receivables 0.3 0.4
Derivative financial assets 0.3 -
349.7 339.1
-------------------------------------------- ------- ------------ ------------
Current assets
Inventories 2.2 1.4
Trade and other receivables 47.9 31.3
Current income tax assets 3.6 3.3
Cash and cash equivalents 5.2 7.8
58.9 43.8
-------------------------------------------- ------- ------------ ------------
Liabilities
Current liabilities
Trade and other payables 63.7 64.8
Borrowings 13 9.5 1.0
Lease liabilities 14 5.2 5.5
Derivative financial liabilities 0.1 0.1
Provisions 0.5 2.0
79.0 73.4
-------------------------------------------- ------- ------------ ------------
Non-current liabilities
Post-employment benefit obligations 15 2.1 14.9
Deferred income tax liabilities 3.3 1.2
Trade and other payables 0.3 0.4
Borrowings 13 18.0 -
Lease liabilities 14 32.6 35.1
Derivative financial liabilities - 2.0
Provisions 0.9 1.3
-------------------------------------------- ------- ------------ ------------
57.2 54.9
-------------------------------------------- ------- ------------ ------------
Net assets 272.4 254.6
-------------------------------------------- ------- ------------ ------------
Equity
Capital and reserves attributable to the company's
shareholders
Share capital 18 44.5 44.4
Share premium 16.8 16.3
Merger reserve 1.6 1.6
Capital redemption reserve 0.6 0.6
Hedge reserve 0.3 (1.0)
Retained earnings 208.6 192.7
-------------------------------------------- ------- ------------ ------------
Total equity 272.4 254.6
-------------------------------------------- ------- ------------ ------------
The notes on pages 20 to 39 form an integral part of these
condensed consolidated financial statements. The condensed
consolidated financial statements on pages 16 to 39 were approved
by the Board of Directors on 7 March 2022 and signed on its behalf
by:
Yvonne Monaghan
Chief Financial Officer
Consolidated Statement OF Cash Flows
Year ended Year ended
31 December 31 December
2021 2020
Restated
Note GBPm GBPm
Cash flows from operating activities
Profit / (loss) for the year 6.6 (26.9)
Adjustments for:
Taxation (credit) / charge - continuing 6 (1.8) (5.2)
- discontinuing 0.3 -
Total finance cost 4 3.3 4.9
Depreciation and impairment 55.1 66.2
Amortisation 9 11.1 11.0
Loss on disposal of tangible fixed assets 0.1 0.8
Loss on disposal of textile rental items - 0.2
Profit on termination of lease liabilities (0.2) -
(Increase) / decrease in inventories (0.8) 0.9
(Increase) / decrease in trade and other receivables (15.4) 23.7
Decrease in trade and other payables (2.1) (0.2)
Deficit recovery payments in respect of post-employment
benefit obligations (1.9) (1.9)
Share-based payments 0.5 0.4
(Decrease) / increase in provisions (2.0) 0.2
Commodity swaps not qualifying as hedges (0.3) 0.3
Insurance claims (5.3) (2.5)
Business acquisition costs charged to the income
statement 0.1 -
Cash generated from operations 47.3 71.9
Interest paid (3.2) (4.0)
Taxation received / (paid) 0.5 (3.4)
--------------------------------------------------------- ---- ------------ ------------
Net cash generated from operating activities 44.6 64.5
--------------------------------------------------------- ---- ------------ ------------
Cash flows from investing activities
Acquisition of businesses (net of cash and overdrafts
acquired) (4.8) (0.9)
Disposal of business costs (3.6) -
Purchase of other intangible assets - (1.2)
Purchase of property, plant and equipment (24.2) (20.4)
Insurance claims 5.3 2.5
Purchase of software (0.2) (1.0)
Proceeds from sale of property, plant and equipment - 0.2
Purchase of textile rental items (41.8) (28.1)
Proceeds received in respect of special charges 12 2.4 2.1
Net cash used in investing activities (66.9) (46.8)
--------------------------------------------------------- ---- ------------ ------------
Cash flows from financing activities
Proceeds from borrowings 29.0 58.0
Repayment of borrowings (12.5) (143.0)
Capital element of leases (5.7) (6.1)
Purchase of own shares by EBT (0.1) -
Proceeds from issue of Ordinary shares 18 0.6 82.9
Net cash generated from / (used in) financing activities 11.3 (8.2)
--------------------------------------------------------- ---- ------------ ------------
Net (decrease) / increase in cash and cash equivalents (11.0) 9.5
Cash and cash equivalents at beginning of year 6.6 (2.9)
Cash and cash equivalents at end of year 16 (4.4) 6.6
--------------------------------------------------------- ---- ------------ ------------
Cash and cash equivalents comprise:
Cash 5.2 7.8
Overdraft (9.6) (1.2)
Cash and cash equivalents at end of year (4.4) 6.6
------------------------------------------ ----- -----
NOTES TO THE PRELIMINARY ANNOUNCEMENT
1 BASIS OF PREPARATION & FORWARD LOOKING STATEMENTS
Basis of Preparation
Johnson Service Group PLC (the 'Company') and its subsidiaries
(together 'the Group') provide textile rental and related services
across the UK.
The Company is incorporated and domiciled in the UK, its
registered number is 523335 and the address of its registered
office is Johnson House, Abbots Park, Monks Way, Preston Brook,
Cheshire, WA7 3GH. The Company is a public limited company and has
its primary listing on the AIM division of the London Stock
Exchange.
The financial information contained within this Preliminary
Announcement has been prepared on a going concern basis in
accordance with UK adopted international accounting standards in
conformity with the requirements of the Companies Act 2006.
The financial information has been prepared using accounting
policies consistent with those set out in the 2020 Annual Report
except as disclosed in note 21 of this Preliminary
Announcement.
The financial information set out within this Preliminary
Announcement does not constitute the Company's statutory accounts
for the years ended 31 December 2021 or 31 December 2020 within the
meaning of Section 434 of the Companies Act 2006, but is derived
from those accounts.
Statutory accounts for 2020 have been delivered to the Registrar
of Companies, and those for 2021 will be delivered as soon as
practicable but not later than 30 April 2022. The auditor has
reported on those accounts; the reports were unqualified and did
not contain a statement under Section 498(2) or (3) of the
Companies Act 2006.
Going Concern
Background and Summary
The Directors have adopted the going concern basis in preparing
these financial statements after careful assessment of identified
principal risks and, in particular, the possible adverse impact on
financial performance, specifically on revenue and cash flows
within the HORECA division, of a protracted delay in returning to
pre-pandemic trading levels. The process and key judgments in
coming to this conclusion are set out below. The going concern
status of the Company is intrinsically linked to that of the
Group.
The Group's business activities, together with the factors
likely to affect its future development, performance and position
are set out in the Strategic Review, Chairman's Statement and Chief
Executive's Operating Review. The financial position of the Group,
its cash flows, liquidity position and borrowing facilities are
described in the Financial Review. In addition, note 26 to the
Consolidated Financial Statements includes the Group's objectives,
policies and processes for managing its capital, its financial risk
management objectives, details of its financial instruments and
hedging activities, and its exposure to credit risk and liquidity
risk.
Going Concern Assessment
The current and plausible future impact of COVID-19 and the
related macroeconomic environment on the Group's activities and
performance has been considered by the Board in preparing its going
concern assessment. The Group has prepared a Base Case scenario,
reflecting an initial set of assumptions around financial
projections and trading performance, together with various, more
pessimistic, expectations for market developments over 2022 and
into 2023 to reflect subdued trading conditions.
The Board is required to assess going concern at each reporting
period. These assessments are significantly more difficult
currently given the uncertainties about the impact of COVID-19 on
the markets in which we operate. The level of judgement to be
applied has therefore increased considerably. The Directors have
considered three main factors in reaching their conclusions on
going concern, as set out below.
1) Cash Flows and Sensitivity Analysis
In assessing going concern, the Directors considered a variety
of scenarios in the context of the COVID-19 pandemic. These
scenarios are not the forecasts of the Group or Company but are
designed to stress test liquidity and covenant compliance. EBITDA
used within the scenarios is that used for bank covenant purposes
which is defined as adjusted operating profit before property,
plant and equipment depreciation, rental stock depreciation, right
of use asset depreciation and software amortisation. The three most
relevant scenarios, in ascending order of severity, reviewed to
test going concern are as follows:
Base Case Scenario
This scenario assumes that the HORECA market continues to
improve, with no further social distancing restrictions being
imposed. The impact of the recent slow-down in HORECA revenue
recovery experienced at the end of 2021 and also in January 2022
has been reflected however, an immediate rebound in volumes, and
hence revenue, is assumed thereafter. The scenario also includes an
estimate of the current and future impact of cost pressures which
the Group, in line with all UK businesses, is experiencing,
particularly in relation to energy and labour.
Limited Slow Down in Revenue Recovery Scenario
Although only limited restrictions have been in place over the
winter months, the ongoing pandemic dampened HORECA volumes, to a
certain extent, particularly during December 2021 and January 2022.
This scenario assumes that it will take three months for HORECA
revenue to return to the level assumed within the Base Case.
Accordingly, HORECA revenue within this scenario has been reduced
to some 84%, 91% and 96% of Base Case levels in February 2022,
March 2022 and April 2022 respectively before returning to that set
out in the Base Case.
Severe but Plausible Scenario
Building upon the "Limited slow-down in revenue recovery
scenario" above, this scenario assumes a more protracted recovery
in that it will take until September 2022 for HORECA revenue to
return to the level assumed within the Base Case. Accordingly,
HORECA revenue within this scenario has been reduced to some 82% of
Base Case levels in February 2022, gradually improving thereafter
month on month and returning to that set out in the Base Case by
September 2022.
2) Covenants
As previously announced, from March 2022, bank covenants will
revert to a leverage and interest covenant test. In all three
scenarios above, the financial projections indicate that the Group
would remain in compliance with the financial covenants in its bank
facilities. A decline in underlying EBIT / EBITDA well in excess of
that contemplated in the scenarios would need to persist throughout
the period for a covenant breach to occur. The Directors do not
consider such a scenario plausible.
The Group also has a number of mitigating actions under its
control (not all of which were included in the scenarios) including
minimising capital expenditure to critical requirements, further
reducing levels of discretionary spend and rationalising its
overhead base in order to be able to meet the covenant tests.
3) Liquidity
The Group remains well funded with access to a committed
Revolving Credit Facility of GBP135 million (the 'Facility), which
matures in August 2023. The Facility is considerably in excess of
our anticipated borrowings and provides ample liquidity in all
scenarios modelled. We anticipate that the facility will be renewed
in the coming months and have commenced discussions with our banks
to this effect.
Going Concern Statement
After considering the current financial scenarios, the severe
but plausible sensitivities and the facilities available to the
Group and Company, the Directors have a reasonable expectation that
the Group and Company have adequate resources for their operational
needs, will remain in compliance with the financial covenants set
out in the bank facility agreement and will continue in operation
for at least the period to 30 June 2023.. As a consequence, and
having reassessed the principal risks and uncertainties, the
Directors considered it appropriate to adopt the going concern
basis in preparing the Group and Company financial statements.
Forward Looking Statements
Certain statements in these condensed consolidated financial
statements constitute forward-looking statements. Any statement in
this document that is not a statement of historical fact including,
without limitation, those regarding the Group's future
expectations, operations, financial performance, financial
condition and business is a forward-looking statement. Such
forward-looking statements are subject to risks and uncertainties
that may cause actual results to differ materially. These risks and
uncertainties include, among other factors, changing economic,
financial, business or other market conditions. These and other
factors could adversely affect the outcome and financial effects of
the plans and events described in these condensed consolidated
financial statements. As a result you are cautioned not to place
reliance on such forward-looking statements. Nothing in this
document should be construed as a profit forecast.
2 SEGMENT ANALYSIS
Segment information is presented based on the Group's management
and internal reporting structure as at 31 December 2021.
The chief operating decision-maker (CODM) has been identified as
the Executive Directors. The CODM reviews the Group's internal
reporting in order to assess performance and allocate resources.
The CODM determines the operating segments based on these reports
and on the internal reporting structure.
For reporting purposes, the CODM considered the aggregation
criteria set out within IFRS 8, 'Operating Segments', which allows
for two or more operating segments to be combined as a single
reporting segment if:
1) aggregation provides financial statement users with
information that allows them to evaluate the business and the
environment in which it operates; and
2) they have similar economic characteristics (e.g. similar
long-term average gross margins would be expected) and are similar
in each of the following respects:
-- the nature of the products and services;
-- the nature of the production processes;
-- the type or class of customer for their products and
services;
-- the methods used to distribute their products or provide
their services; and
-- the nature of the regulatory environment (i.e. banking,
insurance or public utilities), if applicable.
The CODM deems it appropriate to present two reporting segments
(in addition to 'Discontinued Operations' and 'All Other
Segments'), being:
1) Workwear: comprising of our Workwear business only; and
2) Hotel, Restaurants and Catering ('HORECA'): comprising of our
Stalbridge, London Linen, Hotel Linen and Lilliput businesses, each
of which are a separate operating segment.
The CODM's rationale for aggregating the Stalbridge, London
Linen, Hotel Linen and Lilliput operating segments into a single
reporting segment is set out below:
-- the gross margins of each operating segment are within a
similar range, with the long-term average margin expected to
further align;
-- the nature of the customers, products and production
processes of each operating segment are very similar;
-- the nature of the regulatory environment is the same due to
the similar nature of products, processes and customers involved;
and
-- distribution is via exactly the same method across each
operating segment.
The CODM assesses the performance of the reporting segments
based on a measure of operating profit, both including and
excluding the effects of non-recurring items from the reporting
segments, such as restructuring costs and impairments when the
impairment is the result of an isolated, non-recurring or
non-operating event. Interest income and expenditure are not
included in the result for each reporting segment that is reviewed
by the CODM Segment results include items directly attributable to
a segment as well as those that can be allocated on a reasonable
basis, for example rental income received by Johnson Group
Properties PLC (the property holding company of the Group) is
credited back, where appropriate, to the paying company for the
purpose of segmental reporting. There have been no changes in
measurement methods used compared to the prior year.
Other information provided to the CODM is measured in a manner
consistent with that in the financial statements. Segment assets
exclude deferred income tax assets, derivative financial assets,
current income tax assets and cash and cash equivalents, all of
which are managed on a central basis. Segment liabilities include
lease liabilities but exclude current income tax liabilities, bank
borrowings, derivative financial liabilities, post-employment
benefit obligations and deferred income tax liabilities, all of
which are managed on a central basis. These balances are part of
the reconciliation to total assets and liabilities.
Exceptional items have been included within the appropriate
reporting segment as shown on pages 23 to 24.
Workwear
Supply and laundering of workwear * Workwear
garments and protective wear.
HORECA
Linen services for the hotel, restaurant
and catering sector. * Stalbridge
* London Linen
* Hotel Linen
* Lilliput
All Other Segments
Comprising of central and Group costs.
All
Other
Year ended 31 December 2021 Workwear HORECA Segments Total
GBPm GBPm GBPm GBPm
Revenue
Rendering of services 125.8 142.3 - 268.1
Sale of goods 3.1 0.2 - 3.3
------------------------------------------------ ----------- --------- ---------- -------
Total revenue 128.9 142.5 - 271.4
------------------------------------------------ ----------- --------- ---------- -------
Result
Operating profit / (loss) before amortisation
of intangible assets (excluding software
amortisation) and exceptional items 22.5 (5.2) (4.6) 12.7
Amortisation of intangible assets
(excluding software amortisation) - (11.0) - (11.0)
Exceptional items 3.0 (0.1) 3.8 6.7
Operating profit / (loss) 25.5 (16.3) (0.8) 8.4
Total finance cost (3.3)
Profit before taxation 5.1
Taxation credit 1.8
------------------------------------------------ ----------- --------- ---------- -------
Profit for the year from continuing
operations 6.9
------------------------------------------------ ----------- --------- ---------- -------
Loss for the year from discontinued
operations (0.3)
------------------------------------------------ ----------- --------- ---------- -------
Profit for the year attributable to
equity holders 6.6
------------------------------------------------ ----------- --------- ---------- -------
All Other
Workwear HORECA Segments Total
GBPm GBPm GBPm GBPm
Balance sheet information
Segment assets 138.7 259.7 1.1 399.5
Unallocated assets: Current
income tax assets 3.6
Derivative financial assets 0.3
Cash and cash equivalents 5.2
Total assets 408.6
-------------------------------------------------------------------- ----------- --------- ---------- --------
Segment liabilities (38.4) (61.8) (3.0) (103.2)
Unallocated liabilities: Bank
borrowings (27.5)
Derivative financial
liabilities (0.1)
Post-employment benefit
obligations (2.1)
Deferred income tax
liabilities (3.3)
Total liabilities (136.2)
-------------------------------------------------------------------- ----------- --------- ---------- --------
Other information
Non-current asset additions
- Property, plant and equipment 12.7 9.8 - 22.5
- Right of use assets 0.4 0.6 - 1.0
- Textile rental items 19.6 27.1 - 46.7
- Capitalised software - 0.1 - 0.1
Depreciation, impairment and
amortisation expense
- Property, plant and equipment 5.5 11.3 - 16.8
- Right of use assets depreciation 2.2 3.9 - 6.1
- Textile rental items depreciation 16.1 16.1 - 32.2
- Intangible software - 0.1 - 0.1
- Customer contracts - 11.0 - 11.0
-------------------------------------------------------------------- ----------- --------- ---------- --------
The results, assets and liabilities of all segments arise in the
Group's country of domicile, being the United Kingdom.
All
Other
Year ended 31 December 2020 (Restated) Workwear HORECA Segments Total
GBPm GBPm GBPm GBPm
Revenue
Rendering of services 127.1 100.3 - 227.4
Sale of goods 2.4 - - 2.4
------------------------------------------------ --------------- --------- ---------- -------
Total revenue 129.5 100.3 - 229.8
------------------------------------------------ --------------- --------- ---------- -------
Result
Operating profit / (loss) before amortisation
of intangible assets (excluding software
amortisation) and exceptional items 23.5 (31.5) (3.9) (11.9)
Amortisation of intangible assets
(excluding software amortisation) (0.1) (10.9) - (11.0)
Exceptional items (0.1) (4.2) - (4.3)
Operating profit / (loss) 23.3 (46.6) (3.9) (27.2)
Total finance cost (4.9)
Loss before taxation (32.1)
Taxation credit 5.2
------------------------------------------------ ----------- --------- ---------- -------
Loss for the year attributable to
equity holders (26.9)
------------------------------------------------ ----------- --------- ---------- -------
All
Discontinued Other
Operations Workwear HORECA Segments Total
GBPm GBPm GBPm GBPm GBPm
Balance sheet information
Segment assets - 130.9 239.1 1.8 371.8
Unallocated assets: Current
income tax assets 3.3
Cash and cash
equivalents 7.8
----------------------------------------------------
Total assets 382.9
---------------------------------------------------- ------------- ----------------- --------- --------- --------
Segment liabilities (3.5) (47.1) (55.0) (3.5) (109.1)
Unallocated liabilities: Bank
borrowings (1.0)
Derivative
financial
liabilities (2.1)
Post-employment
benefit
obligations (14.9)
Deferred income
tax liabilities (1.2)
----------------------------------------------------
Total liabilities (128.3)
---------------------------------------------------- ------------- ----------------- --------- --------- --------
Other information
Non-current asset additions
- Property, plant and equipment - 6.0 14.7 - 20.7
- Right of use assets - 3.4 1.8 - 5.2
- Textile rental items - 14.1 9.8 - 23.9
- Intangible software - 1.0 - - 1.0
- Customer contracts - - 1.2 - 1.2
Depreciation, impairment and
amortisation expense
- Property, plant and equipment - 5.3 11.2 - 16.5
- Right of use assets depreciation - 2.2 4.5 0.1 6.8
- Right of use assets impairment - 0.1 - - 0.1
- Textile rental items depreciation - 17.7 24.5 - 42.2
- Textile rental items impairment - - 0.6 - 0.6
- Customer contracts - 0.1 10.9 - 11.0
---------------------------------------------------- ------------- ----------------- --------- --------- --------
The results, assets and liabilities of all segments arise in the
Group's country of domicile, being the United Kingdom.
3 EXCEPTIONAL ITEMS
2021 2020
GBPm GBPm
Costs in relation to business acquisition activity (0.1) -
Restructuring costs - (5.8)
Insurance claims 5.9 2.5
Other costs re insurance claims (0.6) -
Income from Parent Company Guarantees 1.5 -
Impairment losses re insurance claims - (1.0)
Total exceptional items 6.7 (4.3)
---------------------------------------------------- ------ ------
Current year exceptional items
Costs in relation to business acquisition activity
During the year, professional fees of GBP0.1 million were paid
relating to the acquisition of Lilliput (Dunmurry) Limited. Further
information relating to the acquisition is provided in note 19.
Insurance claims and other costs
During the prior year, a Workwear processing plant was destroyed
as a result of a fire. Interim insurance proceeds of GBP5.2 million
have been received during the current year. Costs of GBP0.4 million
have been incurred for initial works to demolish the damaged
building along with associated professional fees of GBP0.2 million.
Negotiations are continuing with the insurers for a final
settlement value which is expected to be received in 2022.
A further Workwear processing plant was damaged as a result of
flooding during the previous year. Final settlement proceeds of
GBP0.7 million were received during the current year in respect of
this insurance claim.
Income from Parent Company Guarantees
During the period of ownership of the Facilities Management
division the Company had given guarantees over the performance of
contracts entered into by the division. As part of the disposal of
the division the purchaser has agreed to pursue the release or
transfer of obligations under the Parent Company guarantees and
this is in process. The Sale and Purchase Agreement contains an
indemnity from the purchaser to cover any loss in the event a claim
is made prior to release. A further clause within the Sale and
Purchase Agreement, obligated the purchaser to make an additional
one-off payment in the event the business was subsequently sold. On
16 November 2021, the business was sold and therefore a payment of
GBP1.5 million was made to the Group in respect of this
obligation.
Prior year exceptional items
Restructuring costs
Restructuring costs include GBP4.7 million of redundancy costs
relating to the realignment of the workforce in response to the
impact of COVID-19 and GBP1.1 million in respect of the closure of
the Workwear plant in Newmarket, of which GBP0.4 million related to
redundancy costs.
Insurance claims and impairment losses
During the prior year, a Workwear processing plant was destroyed
as a result of a fire. Plant and equipment with a net book value of
GBP0.5 million and textile rental items with a net book value of
GBP0.2 million were destroyed and have been written off. Interim
insurance proceeds of GBP1.5 million were received.
A further Workwear processing plant was damaged as a result of
flooding during the prior year. Plant and equipment with a net book
value of GBP0.3 million was written off. Interim insurance proceeds
of GBP1.0 million were received.
4 FINANCE COST
2021 2020
GBPm GBPm
Finance cost:
- Interest payable on bank loans and overdrafts 1.4 2.0
- Discontinuance of hedge accounting on interest
rate swaps previously designated as cash flow hedges - 0.6
- (Gain) / loss on interest rate swaps not qualifying
as hedges (0.2) 0.1
- Amortisation of bank facility fees 0.3 0.4
- Finance costs on lease liabilities relating to
IFRS 16 (note 14) 1.6 1.7
- Notional interest on post-employment benefit obligations
(note 15) 0.2 0.1
Total finance cost 3.3 4.9
-------------------------------------------------------------- ------ -----
Following the equity placing in June 2020 which raised GBP82.7
million, the Group repaid its loans outstanding at that date. Hedge
accounting was therefore discontinued at that date as the Group no
longer had any loans for the Group's interest rate swaps to
economically hedge. Accordingly, the Mark to Market value of GBP0.6
million, as at 30 June 2020, was transferred from equity and
recognised as an expense within finance costs. The change in fair
value on interest rate swaps was recognised directly within finance
costs resulting in a GBP0.2 million credit (2020: GBP0.1 million
charge).
5 ALTERNATIVE PERFORMANCE MEASURES (APMs)
Throughout this Preliminary Statement, we refer to a number of
APMs. A reconciliation of the APMs used are shown below:
Adjusted profit / (loss) before taxation 2021 2020
GBPm GBPm
Restated
Profit / (loss) before taxation 5.1 (32.1)
Amortisation of intangible assets (excluding
software amortisation) 11.0 11.0
Exceptional items (6.7) 4.3
Adjusted profit / (loss) before taxation 9.4 (16.8)
Taxation thereon 0.5 3.2
----------------------------------------------- ------- ---------
Adjusted profit / (loss) after taxation 9.9 (13.6)
----------------------------------------------- ------- ---------
Adjusted EBITDA 2021 2020
GBPm
GBPm Restated
Operating profit / (loss) before amortisation
of intangible assets
(excluding software amortisation) and exceptional
items 12.7 (11.9)
Software amortisation 0.1 -
Property, plant and equipment depreciation 16.8 16.5
Right of use asset depreciation 6.1 6.8
Textile rental items depreciation 32.2 42.2
----------------------------------------------------- ------ ----------
Adjusted EBITDA 67.9 53.6
----------------------------------------------------- ------ ----------
6 TAXATION
2021 2020
GBPm GBPm
Current tax
UK corporation tax credit for the year - (3.7)
Adjustment in relation to previous years (0.8) (0.4)
-------------------------------------------------------- ------ ------
Current tax credit for the year (0.8) (4.1)
Deferred tax
Origination and reversal of temporary differences (3.0) (1.9)
Changes in tax rate 1.6 0.7
Adjustment in relation to previous years 0.4 0.1
--------------------------------------------------------
Deferred tax credit for the year (1.0) (1.1)
------ ------
Total credit for taxation included in the Consolidated
Income Statement (1.8) (5.2)
-------------------------------------------------------- ------ ------
The tax credit for the year is lower than (2020: lower than) the
effective rate of Corporation Tax in the UK of 19% (2020: 19%). A
reconciliation is provided below:
2021 2020
GBPm GBPm
Restated
Profit / (loss) before taxation 5.1 (32.1)
-------------------------------------------------------- ------ ---------
Profit / (loss) before taxation multiplied
by the effective rate of Corporation Tax in
the UK 1.0 (6.1)
Factors affecting taxation charge for the year:
Non-taxable income (0.4) -
Tax effect of expenses not deductible for tax
purposes 0.5 0.5
Impact of super deduction (2.5) -
Difference in current and deferred taxation
rates (1.6) -
Changes in tax rate 1.6 0.7
Adjustments in relation to previous years (0.4) (0.3)
-------------------------------------------------------- ------ ---------
Total credit for taxation included in the Consolidated
Income Statement (1.8) (5.2)
-------------------------------------------------------- ------ ---------
Taxation in relation to amortisation of intangible assets
(excluding software amortisation) has increased the credit for
taxation on continuing operations by GBP1.6 million (2020: GBP1.2
million increase). Taxation in relation to exceptional items has
decreased the credit for taxation on continuing operations by
GBP0.3 million (2020: GBP0.8 million increase).
The rate of UK corporation tax is currently 19.0%. The Finance
Bill 2021 enacted provisions to increase the main rate of UK
corporation tax to 25% from 6 April 2023 for businesses with
profits of GBP250,000 or more. As such, deferred income tax
balances at the balance sheet date have been measured at the tax
rate expected to be applicable at the date the deferred income tax
assets and liabilities are realised. Management has performed an
assessment, for all material deferred income tax assets and
liabilities, to determine the period over which the deferred assets
and liabilities are forecast to be realised, which has resulted in
an average deferred income tax rate of 23.3%.
The impact of the change in deferred tax rate has been a GBP1.6
million charge (2020: GBP0.7 million charge) in the Consolidated
Income Statement and GBPnil (2020: GBP0.2 million credit)
recognised within Other Comprehensive Income.
A capital allowance super deduction, which offers 130% first
year relief on qualifying main rate plant and machinery investments
until 31 March 2023, has been included within the tax calculations
for 31 December 2021. This allowance provides a 30% permanent
difference on our Textile Rental items given their short life
nature. The impact of the super deduction to 31 December 2021 is a
GBP2.5 million credit recognised within the Consolidated Income
Statement.
During the year, a deferred taxation charge of GBP2.1 million
(2020: GBP1.7 million credit) has been recognised in Other
Comprehensive Income in relation to post-employment benefit
obligations.
During the year, GBPnil relating to deferred taxation (2020:
GBP0.2 million charge) has been recognised directly in
Shareholders' equity.
7 DIVIDS
Whilst the Board recognises the importance of dividends to our
Shareholders, this had to be balanced with the impact that COVID-19
has had on our business. As previously guided, the Board does not
propose to declare a dividend in respect of 2021 but will keep
future dividends under review and look to reinstate its dividend
policy once there is more certainty that trading levels will return
to, and remain at, more normal levels.
8 EARNINGS / (LOSS) PER SHARE 2021 2020
GBPm GBPm
Restated
Profit / (loss) for the financial year from
continuing operations attributable to Shareholders 6.9 (26.9)
Amortisation of intangible assets from continuing
operations (net of taxation) 9.4 9.8
Exceptional costs from continuing operations
(net of taxation) (6.4) 3.5
----------------------------------------------------------- ------------ ------------
Adjusted profit / (loss) from continuing operations
attributable to Shareholders 9.9 (13.6)
----------------------------------------------------------- ------------ ------------
Loss from discontinued operations attributable
to Shareholders (0.3) -
----------------------------------------------------------- ------------ ------------
Total profit / (loss) from all operations attributable
to Shareholders 9.6 (13.6)
----------------------------------------------------------- ------------ ------------
No. of No. of
shares shares
Weighted average number of Ordinary shares 444,939,982 412,947,064
Potentially dilutive Ordinary shares 206,112 835,491
----------------------------------------------------------- ------------ ------------
Diluted number of Ordinary shares 445,146,094 413,782,555
----------------------------------------------------------- ------------ ------------
Basic earnings / (loss) per share
From continuing operations 1.6p (6.5)p
From discontinuing operations (0.1)p -
----------------------------------------------------------- ------------ ------------
From total operations 1.5p (6.5)p
Adjustments for amortisation of intangible assets
(continuing) 2.1p 2.4p
Adjustment for exceptional items (continuing) (1.5)p 0.8p
Adjustment for exceptional items (discontinued) 0.1p -
----------------------------------------------------------- ------------ ------------
Adjusted basic earnings / (loss) per share (continuing) 2.2p (3.3)p
Adjusted basic earnings / (loss) per share (discontinued) - -
----------------------------------------------------------- ------------ ------------
Adjusted basic earnings / (loss) per share from
total operations 2.2p (3.3)p
Diluted earnings / (loss) per share
From continuing operations 1.6p (6.5)p
From discontinuing operations (0.1)p -
----------------------------------------------------------- ------------ ------------
From total operations 1.5p (6.5)p
----------------------------------------------------------- ------------ ------------
Adjustments for amortisation of intangible assets
(continuing) 2.1p 2.4p
Adjustment for exceptional items (continuing) (1.5)p 0.8p
Adjustment for exceptional items (discontinued) 0.1p -
-----------------------------------------------------------
Adjusted diluted earnings / (loss) per share 2.2p (3.3)p
----------------------------------------------------------- ------------ ------------
Adjusted diluted earnings / (loss) per share
(continuing) 2.2p (3.3)p
Adjusted diluted earnings / (loss) per share
(discontinued) - -
----------------------------------------------------------- ------------ ------------
Adjusted diluted earnings / (loss) per share
from total operations 2.2p (3.3)p
----------------------------------------------------------- ------------ ------------
Adjusted diluted earnings per share excluding
super deduction (continuing) 1.7p (3.3)p
----------------------------------------------------------- ------------ ------------
Basic earnings per share is calculated using the weighted
average number of Ordinary shares in issue during the year,
excluding those held by the Employee Benefit Trust, based on the
profit for the year attributable to Shareholders. Adjusted earnings
per share figures are given to exclude the effects of amortisation
of intangible assets (excluding software amortisation) and
exceptional items, all net of taxation, and are considered to show
the underlying performance of the Group.
As disclosed in note 6, the current year total taxation credit
has benefited from GBP2.5 million of additional credit resulting
from the capital allowance super deduction, which offers 130% first
year relief on qualifying main rate plant and machinery investments
until 31 March 2023. Due to the distortion this has on adjusted
diluted earnings per share in 2021, an adjusted diluted earnings
per share value excluding this benefit has been disclosed.
For diluted earnings per share, the weighted average number of
Ordinary shares in issue is adjusted to assume conversion of all
potentially dilutive Ordinary shares. The Company has potentially
dilutive Ordinary shares arising from share options granted to
employees. Options are dilutive under the SAYE scheme, where the
exercise price together with the future IFRS 2 charge of the option
is less than the average market price of the Company's Ordinary
shares during the year. Options under the LTIP schemes, as defined
by IFRS 2, are contingently issuable shares and are therefore only
included within the calculation of diluted EPS if the performance
conditions, as set out in the Directors' Remuneration Report, are
satisfied at the end of the reporting period, irrespective of
whether this is the end of the vesting period or not.
Potentially dilutive Ordinary shares are dilutive at the point,
from a continuing operations level, when their conversion to
Ordinary shares would decrease earnings per share or increase loss
per share. For the year ended 31 December 2021 potentially dilutive
Ordinary shares have been treated as dilutive, as their inclusion
in the diluted earnings per share calculation decreases the loss
per share from continuing operations. For the year ended 31
December 2020, potentially dilutive Ordinary shares have not been
treated as dilutive, as their inclusion in the diluted earnings per
share calculation decreases the loss per share from continuing
operations.
There were no events occurring after the balance sheet date that
would have changed significantly the number of Ordinary shares or
potentially dilutive Ordinary shares outstanding at the balance
sheet date if those transactions had occurred before the end of the
reporting period.
9 INTANGIBLE ASSETS
Capitalised software
2021 2020
GBPm GBPm
Restated
Opening net book value (as previously reported) 1.5 1.9
Prior year restatement (see note 21) - (1.4)
Additions 0.1 1.0
Amortisation (0.1) -
Closing net book value 1.5 1.5
------------------------------------------------- ------- ---------
Other intangible assets
2021 2020
GBPm GBPm
Opening net book value 25.0 34.8
Additions - 1.2
Business combinations (note 19) 1.2 -
Amortisation (11.0) (11.0)
Closing net book value 15.2 25.0
--------------------------------- ------- -------
Other intangible assets comprise of customer contracts and
relationships. During the year to 31 December 2021, the Group
acquired customer contracts valued at GBPnil (2020: GBP1.2
million).
10 PROPERTY, PLANT AND EQUIPMENT
2021 2020
GBPm GBPm
Opening net book value 107.2 104.0
Additions 22.5 20.7
Business combinations (note 19) 0.5 -
Depreciation (16.8) (16.5)
Disposals (0.1) (1.0)
Closing net book value 113.3 107.2
--------------------------------- ------- -------
CAPITAL COMMITMENTS
Orders placed for future capital expenditure contracted but not
provided for in the financial statements are shown below:
2021 2020
GBPm GBPm
Software - 0.1
Property, plant and equipment 10.9 10.3
------------------------------- ------- -------
11 RIGHT OF USE ASSETS
2021 2020
GBPm GBPm
Opening net book value 38.5 39.0
Additions 1.0 5.2
Business combinations (note 19) 0.8 -
Reassessment/modification of assets previously
recognised 1.3 1.9
Depreciation (6.1) (6.8)
Impairment losses - (0.1)
Disposals - (0.7)
Closing net book value 35.5 38.5
------------------------------------------------ ------ ------
The reassessment / modification of assets relates to rental
increases and extensions to lease terms that have been agreed
during the year to 31 December 2021 and 31 December 2020 for
property leases that were in place at the start of the relevant
year.
12 TEXTILE RENTAL ITEMS
2021 2020
GBPm GBPm
Opening net book value 35.6 56.8
Additions 46.7 23.9
Business combinations (note 19) 0.7 -
Depreciation (32.2) (42.2)
Impairment losses - (0.6)
Disposals - (0.2)
Special charges (2.4) (2.1)
Closing net book value 48.4 35.6
--------------------------------- ------- -------
13 BORROWINGS
2021 2020
GBPm GBPm
Current
Overdraft 9.6 1.2
Bank loans (0.1) (0.2)
9.5 1.0
------------- ------ ------
Non-current
Bank loans 18.0 (0.2)
18.0 (0.2)
------------- ------ ------
27.5 0.8
------------- ------ ------
At 31 December 2021, borrowings were secured and drawn down
under a committed facility dated 21 February 2014, as amended and
restated from time to time. This amended facility comprised a
GBP135.0 million rolling credit facility (including an overdraft)
which runs to August 2023 and a GBP40.0 million rolling credit
facility which was cancelled by the Group on 11 February 2022.
Individual tranches are drawn down, in sterling, for periods of
up to six months at SONIA rates of interest prevailing at the time
of drawdown, plus the credit adjustment spread and the applicable
margin. The margin for the period to 31 March 2022 is fixed at
2.00% and then varies between 1.25% and 2.25% thereafter.
The secured bank loans are stated net of unamortised issue costs
of GBP0.1 million (2020: GBP0.4 million) of which GBP0.1 million is
included within current borrowings (2020: GBP0.2 million) and
GBPnil is included within non-current borrowings (2020: GBP0.2
million within non-current trade and other receivables as there
were no borrowings at the end of the prior period for the fees to
be offset against).
The Group has two net overdraft facilities for GBP5.0 million
and GBP3.0 million with two of its principal bankers (2020: GBP5.0
million and GBP3.0 million).
As at 31 December 2021, the Group has in place the following
hedging arrangements which have the effect of replacing LIBOR/SONIA
with fixed rates as follows:
-- for GBP15.0 million of borrowings, LIBOR is replaced with
1.144% from 30 January 2019 to 31 January 2022; and
-- for GBP15.0 million of borrowings, LIBOR is replaced with
0.805% from 8 January 2020 to 9 January 2022. From 10 January 2022
to 9 January 2023, SONIA plus 0.1193% Credit Adjustment Spread is
replaced with 0.805%.
As the final rate fix for the interest rate swap ending 31
January 2022 was 31 October 2021, when LIBOR was still being
quoted, the transition from LIBOR to SONIA was not required for
this swap.
Following the equity placing in June 2020 hedge accounting was
discontinued at that date as the Group no longer had any loans for
the Group's interest rate swaps to economically hedge. Hedge
accounting has not been resumed.
Amounts drawn under the revolving credit facility have been
classified as either current or non-current depending upon when the
loan is expected to be repaid.
14 LEASE LIABILITIES
2021 2020
GBPm GBPm
Opening liabilities 40.6 40.4
New leases recognised 1.0 5.1
Business combinations (note 19) 0.8 -
Reassessment / modification of leases previously
recognised 1.3 1.9
Lease payments (7.3) (7.8)
Disposals (0.2) (0.7)
Finance costs 1.6 1.7
Closing liabilities 37.8 40.6
-------------------------------------------------- ------ ------
Of which are:
Current lease liabilities 5.2 5.5
Non-current lease liabilities 32.6 35.1
------------------------------- ----- -----
Closing liabilities 37.8 40.6
------------------------------- ----- -----
The reassessment/modification of leases relates to rent
increases and extensions to lease terms that have been agreed
during the year.
15 POST-EMPLOYMENT BENEFIT OBLIGATIONS
The Group has applied the requirements of IAS 19, 'Employee
Benefits' (revised June 2011) to its employee pension schemes and
post-retirement healthcare benefits. The Group operates a defined
benefit pension scheme, the Johnson Group Defined Benefit Scheme
('JGDBS'). The JGDBS was closed to future accrual on 31 December
2014.
As part of the Group's objective to reduce its overall pension
deficit, deficit recovery payments of GBP1.9 million (2020: GBP1.9
million) were paid to the JGDBS. A net re-measurement and
experience gain of GBP11.0 million has been recognised in the year
to 31 December 2021.
The gross post-employment benefit obligation and associated
deferred income tax asset thereon is shown below:
2021 2020
GBPm GBPm
Gross post-employment benefit obligation 2.1 14.9
Deferred income tax asset thereon (0.4) (2.8)
------------------------------------------ ------ ------
Net liability 1.7 12.1
------------------------------------------ ------ ------
The reconciliation of the opening gross post-employment benefit
obligation to the closing gross post-employment benefit obligation
is shown below:
2021 2020
GBPm GBPm
Opening gross post-employment benefit obligation (14.9) (7.3)
Notional interest (0.2) (0.1)
Deficit recovery payments 1.9 1.9
Utilisation of post-retirement healthcare
obligation 0.1 -
Re-measurement and experience gains / (losses) 11.0 (9.4)
Closing gross post-employment benefit obligation (2.1) (14.9)
-------------------------------------------------- ------- -------
16 ANALYSIS OF NET DEBT
Net debt is calculated as total borrowings net of unamortised
bank facility fees, less cash and cash equivalents. Non-cash
changes represent the effects of the recognition and subsequent
amortisation of fees relating to the bank facility, changing
maturity profiles, debt acquired as part of an acquisition and the
recognition of lease liabilities entered into during the year.
At 31 At 31
December Non-cash December
2021 2020 Cash Flow Changes 2021
GBPm GBPm GBPm GBPm
Debt due within one
year 0.2 1.5 (1.6) 0.1
Debt due after more
than one year 0.2 (18.0) (0.2) (18.0)
Lease liabilities (See
note 14) (40.6) 5.7 (2.9) (37.8)
---------------------------- --- ---------- ---------- ----------- ----------
Total debt and lease
financing (40.2) (10.8) (4.7) (55.7)
Cash and cash equivalents 6.6 (11.0) - (4.4)
---------------------------- --- ---------- ---------- ----------- ----------
Net debt (33.6) (21.8) (4.7) (60.1)
---------------------------- --- ---------- ---------- ----------- ----------
At 1 At 31
January Non-cash December
2020 Cash Flow Changes 2020
2020 GBPm GBPm GBPm GBPm
Debt due within one year 0.3 0.1 (0.2) 0.2
Debt due after more than
one year (84.7) 85.1 (0.2) 0.2
Lease liabilities (40.4) 6.1 (6.3) (40.6)
-------------------------------- --------- ---------- --------- ----------
Total debt and lease financing (124.8) 91.3 (6.7) (40.2)
Cash and cash equivalents (2.9) 9.5 - 6.6
--------- ---------- --------- ----------
Net debt (127.7) 100.8 (6.7) (33.6)
-------------------------------- --------- ---------- --------- ----------
The cash and cash equivalents figures are comprised of the
following balance sheet amounts:
2021 2020
GBPm GBPm
Cash (Current assets) 5.2 7.8
Overdraft (Borrowings, Current liabilities) (9.6) (1.2)
(4.4) 6.6
--------------------------------------------- ------ ------
Lease liabilities are comprised of the following balance sheet
amounts:
2021 2020
GBPm GBPm
Amounts due within one year (Lease liabilities,
Current liabilities) (5.2) (5.5)
Amounts due after more than one year (Lease
liabilities, Non-current liabilities) (32.6) (35.1)
(37.8) (40.6)
------------------------------------------------- ------- -------
17 RECONCILIATION OF NET CASH FLOW TO MOVEMENT IN NET DEBT
2021 2020
GBPm GBPm
(Decrease) / increase in cash in year (11.0) 9.5
(Increase) / decrease in debt and lease financing (10.8) 91.3
--------------------------------------------------- ------- --------
Change in net debt resulting from cash flows (21.8) 100.8
Debt acquired through business acquisitions (2.3) -
Lease liabilities recognised during the period (2.1) (6.3)
Non-cash movement in unamortised bank facility
fees (0.3) (0.4)
Movement in net debt (26.5) 94.1
Opening net debt (33.6) (127.7)
--------------------------------------------------- ------- --------
Closing net debt (60.1) (33.6)
--------------------------------------------------- ------- --------
18 SHARE CAPITAL
2021 2020
Issued and Fully Paid Shares GBPm Shares GBPm
Ordinary shares of
10p each:
- At start of year 444,211,100 44.4 369,760,824 37.0
- New shares issued 1,045,539 0.1 74,450,276 7.4
- At end of year 445,256,639 44.5 444,211,100 44.4
------------------------- ------------ ----- ------------ -----
Issue of Ordinary shares of 10p each
An analysis of the new shares issued in each year is shown
below:
2021 2020
Issued and Fully
Paid Shares GBP Shares GBP
Ordinary shares of
10p each:
note
- EBT a 560,000 56,000 300,000 30,000
note
- SAYE b 485,539 48,554 235,088 23,509
note
- Placing c - - 73,915,188 7,391,519
New shares issued 1,045,539 104,544 74,450,276 7,445,028
----------------------------- ---------- -------- ----------- ----------
Note a: 560,000 (2020: 300,000) Ordinary shares were allotted to
the EBT at nominal value to be used in relation to employee share
option exercises. The total nominal value received was GBP56,000
(2020: GBP30,000). At the time of allotment, the EBT already held
8,388 (2020: 12,468) Ordinary shares of 10 pence each which,
together with the 560,000 (2020: 300,000) newly allotted Ordinary
shares of 10 pence each, were used to satisfy the exercise of
559,364 (2020: 304,080) LTIP options. In addition, the EBT did not
sell any shares (2020: nil).
Note b: 485,539 (2020: 235,088) SAYE Scheme options were
exercised with a total nominal value of GBP48,554 (2020:
GBP23,509).
Note c: During the year ended 31 December 2020, the Company
placed 73.9 million Ordinary shares (the '2020 Placing') with
existing and new institutional investors raising net proceeds of
GBP82.7 million (gross proceeds of GBP85.0 million less costs of
GBP2.3 million) of which GBP7.4 million was credited to share
capital. The 2020 Placing shares represented approximately 19.99
per cent. of the Company's existing share capital. The 2020 Placing
price of 115 pence per share was equal to a discount of 7 per cent.
to the 10-day average closing mid-market price of 123.6 pence per
share, and 2 per cent. to the 10-day volume weighted average price
of 117.5 pence per ordinary share both ending on 28 May 2020, being
the last practicable day prior to the publication of the
announcement.
Whilst the Directors were cognisant to the effect of any
non-pre-emptive issuance on retail shareholders, due to the size of
the transaction, and the short timeframe required to secure
additional liquidity as part of the Company's response to the
extreme circumstances of the COVID-19 pandemic, the 2020 Placing
was undertaken on a non-pre-emptive basis using a cash box
structure. The Company was, therefore, able to rely on Section 612
of the Companies Act 2006, which provides relief from the
requirements under Section 610 of the Companies Act 2006 to create
a share premium account. As such, no share premium was recorded in
relation to the 2020 Placing shares and, instead, the net proceeds
in excess of the nominal value of the 2020 Placing shares was
credited to retained earnings. Such retained earnings are
considered to be distributable for the purposes of the Companies
Act 2006.
For the avoidance of doubt, existing share awards were not
normalised to negate the dilutive effect of the 2020 Placing.
The total proceeds received on allotment in respect of all of
the above transactions were GBP0.6 million (2020: GBP82.9 million)
and were credited as follows:
2021 2020
GBPm GBPm
Share capital 0.1 7.4
Share premium 0.5 0.2
Retained earnings - 75.3
0.6 82.9
------------------- ----- -----
19 BUSINESS COMBINATIONS
On 30 September 2021, the Group acquired 100% of the share
capital of Lilliput (Dunmurry) Limited ('Lilliput') for a net
consideration of GBP3.1 million (being gross consideration of
GBP6.2 million adjusted for normalised working capital, cash and
debt like items) plus associated fees. Since acquisition, Lilliput
has incurred a loss of GBP0.2 million on revenue of GBP1.6 million.
Had the business been acquired at the start of the period it is
estimated that a loss of GBP0.7 million would have been generated
from revenue of GBP5.2 million.
The provisional fair value of assets and liabilities acquired
are as follows:
Lilliput
GBPm
Intangible assets - Goodwill 4.3
Intangible assets - Customer contracts 1.2
Property, plant and equipment 0.5
Right of use assets 0.8
Textile rental items 0.7
Trade and other receivables 1.4
Cash and cash equivalents / (overdraft) (0.8)
Trade and other payables (2.3)
Borrowings (1.5)
Lease liabilities (0.8)
Deferred income tax liability (0.4)
----------------------------------------- ---------
Net consideration 3.1
----------------------------------------- ---------
Goodwill represents the deferred income tax arising on the
recognition of the customer contracts plus the expected benefits to
the wider Group arising from the acquisition. None of the acquired
goodwill is expected to be deductible for tax purposes.
During 2020, the initial fair value of the trade and other
payables acquired as part of the Fresh Linen acquisition was
increased by GBP0.4 million, with a corresponding increase in
goodwill.
Cash flows from business acquisition activity
The cash flows in relation to business acquisition activity are
summarised below:
2021 2020
GBPm GBPm
Net consideration payable (3.1) -
Deferred consideration (0.8) (0.9)
Overdraft acquired (0.8) -
Costs in relation to business acquisition
activity (0.1) -
(4.8) (0.9)
------------------------------------------- ------ ------
In respect of deferred consideration:
-- the 2021 figure of GBP0.8 million reflects the payment of the
Fresh Linen deferred consideration of GBP0.8 million recognised in
2019; and
-- the 2020 figure of GBP0.9 million reflects the payment of the
PLS contingent consideration of GBP0.2 million recognised in 2017
along with the payment of GBP0.7 million for deferred consideration
recognised in the prior year for Fresh Linen.
20 DISCONTINUED OPERATIONS
As previously disclosed, a contingent liability arose as a
condition of the sale of the Facilities Management division in
August 2013, whereby the Group had put in place indemnities, to the
purchaser, in relation to any future amounts payable in respect of
contingent consideration relating to the Nickleby acquisition which
was completed in February 2012. The contingent consideration was
settled during the year for GBP3.3 million including associated
costs. GBP1.6 million has been recognised in the Consolidated
Income Statement during 2021 in relation to this settlement.
On 4 January 2017, the Group disposed of the Dry Cleaning
division. Provisions of GBP1.1 million, made at the point of
disposal are no longer required and have been credited to the
Consolidated Income Statement during 2021. Furthermore, property
provisions of GBP0.5 million relating to historic disposals are
also no longer required and have been credited back to the
Consolidated Income Statement in 2021.
Income Statement
The Income Statement from discontinued operations included
within the Consolidated Income Statement are as follows:
2021 2020
GBPm GBPm
Exceptional items
- Property provision 1.6 -
- Indemnity settlement (1.6) -
------------------------------------------- ------ -----
Operating result - -
------------------------------------------- ------ -----
Taxation (0.3) -
------------------------------------------- ------ -----
Retained loss from discontinued operations (0.3) -
------------------------------------------- ------ -----
Cash Flows
The cash flows from discontinued operations included within the
Consolidated Statement of Cash Flows are as follows:
2021 2020
GBPm GBPm
Net cash used in investing activities (3.6) -
------------------------------------------- ------ -----
Net cash flow from discontinued operations (3.6) -
------------------------------------------- ------ -----
Along with the settlement discussed above, a further cash
settlement of GBP0.3 million was made in relation to indemnities
made to the purchaser of the Dry Cleaning division. These amounts
had been provided for in full at the point of disposal.
21 PRIOR YEAR RESTATEMENT
In 2021, the IFRS Interpretations Committee (IFRIC) published an
agenda decision on the clarification of accounting in relation
to
the configuration and customisation costs incurred in
implementing Software-as-a-Service (SaaS) as follows:
-- Amounts paid to the cloud vendor for configuration and
customisation that are not distinct from access to the cloud
software are expensed over the SaaS contract term.
-- In limited circumstances, other configuration and
customisation costs incurred in implementing SaaS arrangements may
give rise to an identifiable intangible asset, for example, where
code is created that is controlled by the entity.
-- In all other instances, configuration and customisation costs
will be expensed as the customisation and configuration services
are received.
Following the agenda decision, the Group reviewed its costs
incurred in respect of the configuration and customisation of
cloud-based software applications implemented across the Group. As
it was concluded that the Group's arrangements were not in the
scope of IFRS 16, the costs were assessed in line with the guidance
in IAS 38. The costs incurred did not create a resource controlled
by the Group that is separate to the software and as such did not
relate to a separately identifiable asset under IAS 38. The Group's
accounting policy has therefore been revised so that such costs are
expensed to the Consolidated Income Statement. As the configuration
and customisation services were performed in conjunction with a
third party, the costs should be expensed as and when the services
are received. This clarification has been accounted for
retrospectively resulting in a prior year restatement.
The Group identified GBP1.5 million of capitalised costs
incurred prior to 1 January 2020 which should, in light of the
agenda decision, have been expensed to the Consolidated Income
Statement as incurred. Amortisation thereon of GBP0.1 million was
charged to the Consolidated Income Statement prior to 1 January
2020 resulting in a GBP1.4 million adjustment to Intangible assets
at 1 January 2020.
The impact of the prior year restatement on the Group's opening
Consolidated Balance Sheet is as follows:
As at As at
31 December Prior year 1 January
2019 adjustment 2020
GBPm GBPm GBPm
Non-current assets
Intangible assets 36.7 (1.4) 35.3
Current liabilities
Current income tax liabilities 4.5 (0.3) 4.2
Net assets 207.5 (1.1) 206.4
----------------------------------- ------------ ------------ ----------
Capital and reserves attributable
to the Company's Shareholders
Retained earnings 152.7 (1.1) 151.6
----------------------------------- ------------ ------------ ----------
Total equity 207.5 (1.1) 206.4
----------------------------------- ------------ ------------ ----------
The impact of the prior year restatement on the Group's retained
earnings as at 1 January 2020 is as follows:
GBPm
As at 31 December 2019 152.7
Recognition of cloud-based software costs (1.5)
Reverse amortisation previously charged 0.1
Decrease in current income tax liabilities 0.3
Adjustment to retained earnings (1.1)
-------------------------------------------- -------
As at 1 January 2020 151.6
-------------------------------------------- -------
As a result of the above costs being expensed through the
Consolidated Income Statement prior to 1 January 2020, amortisation
of the previously capitalised costs have been reversed in the year
to 31 December 2020. This cost was GBP0.2 million. The impact of
the prior year restatement on the Consolidated Income Statement for
the year ended 31 December 2020 is as follows:
Year ended Prior year Year ended
31 December adjustment 31 December
2020 2020
GBPm GBPm GBPm
Operating loss before amortisation
of intangible assets
(excluding software amortisation)
and exceptional items (12.1) 0.2 (11.9)
Operating loss (27.4) 0.2 (27.2)
Loss before taxation (32.3) 0.2 (32.1)
Loss for the year attributable to
equity holders (27.1) 0.2 (26.9)
The impact of the prior year restatement on the Group's earnings
per share for the year ended 31 December 2020 is as follows:
Year ended Year ended
31 December Prior year 31 December
2020 adjustment 2020
p p p
Basic loss per share (6.6) 0.1 (6.5)
Adjusted basic loss per share (3.4) 0.1 (3.3)
Diluted earnings per share (6.6) 0.1 (6.5)
Adjusted diluted earnings per share (3.4) 0.1 (3.3)
22 EVENTS AFTER THE REPORTING PERIOD
There were no events occurring after the balance sheet date that
require disclosing in accordance with IAS 10, 'Events after the
reporting period'.
23 PRINCIPAL RISKS AND UNCERTAINTIES
Our Approach to Risk Management
The Board has overall accountability for ensuring that risk is
effectively managed across the Group and, on behalf of the Board,
the Audit Committee coordinates and reviews the effectiveness of
the Group's risk management process.
Risks are reviewed by all of our businesses on an ongoing basis
and are measured against a defined set of likelihood and impact
criteria. This is captured in consistent reporting formats enabling
the Audit Committee to review and consolidate risk information and
summarise the principal risks and uncertainties facing the Group.
Wherever possible, action is taken to mitigate, to an acceptable
level, the potential impact of identified principal risks and
uncertainties.
The Board formally reviews the most significant risks facing the
Group at its February and August meetings, or more frequently
should new matters arise. Throughout 2021, and other than as
described below, the overall risk environment remained largely
unchanged from that reported within the Group's 2020 Annual
Report.
Risk Appetite
The Board interprets appetite for risk as the level of risk that
the Company is willing to take in order to meet its strategic
goals. The Board communicates its approach to, and appetite for,
risk to the business through the strategy planning process and the
internal risk governance and control frameworks. In determining its
risk appetite, the Board recognises that a prudent and robust
approach to risk assessment and mitigation must be carefully
balanced with a degree of flexibility so that the entrepreneurial
spirit which has greatly contributed to the success of the Group is
not inhibited. Both the Board and the Audit Committee remain
satisfied that the Group's internal risk control framework
continues to provide the necessary element of flexibility without
compromising the integrity of risk management and internal control
systems.
Emerging Risks
The Board has established processes for identifying emerging
risks, and horizon scanning for risks that may arise over the
medium to long term. Emerging and potential changes to the Group's
risk profile are identified through the Group's risk governance
frameworks and processes, and through direct feedback from
management, including changing operating conditions, market and
consumer trends.
Principal Risks and Uncertainties
The principal risks and uncertainties affecting the Group are
summarised below:
* Economic Conditions * Competition and Disruption
* Failure of Strategy * Recruitment, Retention and Motivation of Employees
* Loss of a Processing Facility * Health and Safety
* Cost Inflation * Compliance and Fraud
* Insufficient Processing Capacity * Information Systems and Technology
* Customer Sales and Retention * Climate Change and Energy Costs
Full details of the above risks, together with details on how
the Board takes action to mitigate each risk, will be provided in
our 2021 Annual Report. These risks and uncertainties do not
comprise all of the risks that the Group may face and are not
necessarily listed in any order of priority. Additional risks and
uncertainties not presently known to the Board, or deemed to be
less material, may also have an adverse effect on the Group.
In accordance with the provisions of the UK Corporate Governance
Code, the Board has taken into consideration the principal risks
and uncertainties in the context of determining whether to adopt
the going concern basis of preparation and when assessing the
future prospects of the Group.
24 STATEMENT OF DIRECTORS' RESPONSIBILITIES IN RESPECT OF THE FINANCIAL STATEMENTS
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 to prepare the Group and Company financial statements in
accordance with UK-adopted international accounting standards.
Under company law the Directors must not approve the financial
statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Group and Company and of the
profit or loss of the Group for that period.
In preparing the financial statements, the Directors are
required to:
-- select suitable accounting policies and then apply them
consistently;
-- make judgments and accounting estimates that are reasonable
and prudent; and
-- state whether applicable UK-adopted international accounting
standards have been followed, subject to any material departures
disclosed and explained in the financial statements.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the Group and
Company's transactions and disclose with reasonable accuracy at any
time the financial position of the Group and Company and enable
them to ensure that the financial statements comply with the
Companies Act 2006. They are also responsible for safeguarding the
assets of the Group and Company 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 Group's
website. Legislation in the United Kingdom governing the
preparation and dissemination of financial statements may differ
from legislation in other jurisdictions.
The Directors are responsible for preparing the Annual Report in
accordance with applicable law and regulations. Having taken advice
from the Audit Committee, the Directors consider that the Annual
Report and the financial statements, taken as a whole, provides the
information necessary to assess the Group and Company's
performance, business model and strategy and is fair, balanced and
understandable.
To the best of our knowledge:
-- the Group financial statements, prepared in accordance with
UK-adopted international accounting standards, give a true and fair
view of the assets, liabilities, financial position and profit or
loss of the Company and the undertakings included in the
consolidation, taken as a whole; and
-- the Strategic Report and Directors' Report include a fair
review of the development and performance of the business and the
position of the Company and the undertakings included in the
consolidation, taken as a whole, together with a description of the
principal risks and uncertainties that they face.
The Directors confirm that:
-- so far as each Director is aware, there is no relevant audit
information of which the Group and Company's auditor is unaware;
and
-- the Directors have taken all the steps that they ought to
have taken as a Director in order to make themselves aware of any
relevant audit information and to establish that the Group and
Company's auditor is aware of that information.
25 PRELIMINARY ANNOUNCEMENT
A copy of this Preliminary Announcement is available on request
to all Shareholders by post from the Company Secretary, Johnson
Service Group PLC, Johnson House, Abbots Park, Monks Way, Preston
Brook, Cheshire, WA7 3GH. The announcement can also be accessed on
the Internet at www.jsg.com.
The 2021 Annual Report will be made available on the Group's
website (www.jsg.com) on or before 25 March 2022.
26 APPROVAL
The Preliminary Announcement was approved by the Board of
Directors on 7 March 2022.
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
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END
FR UBVWRUKUORAR
(END) Dow Jones Newswires
March 08, 2022 02:00 ET (07:00 GMT)
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