Trimite Top Co Limited - Limited company accounts 20.1

REGISTERED NUMBER: 11059057 (England and Wales)

Group Strategic Report,

Report of the Directors and

Consolidated Financial Statements

for the Year Ended 31 March 2020

for

TRIMITE TOP CO LIMITED

Page

Company Information

1

Group Strategic Report

2

Report of the Directors

5

Report of the Independent Auditors

7

Consolidated Statement of Comprehensive Income

9

Consolidated Balance Sheet

10

Company Balance Sheet

11

Consolidated Statement of Changes in Equity

12

Company Statement of Changes in Equity

13

Consolidated Cash Flow Statement

14

Notes to the Consolidated Cash Flow Statement

15

Notes to the Consolidated Financial Statements

16

Directors:

N A Johnson

S P Thornhill

N E Smith

Registered office:

2e Eagle Road

Moons Moat North Industrial Estate

Redditch

B98 9HF

Registered number:

11059057 (England and Wales)

Auditors:

Haines Watts Birmingham LLP

5-6 Greenfield Crescent

Edgbaston

Birmingham

B15 3BE

Bankers:

HSBC UK Bank plc

1 Centenary Square

Birmingham

B1 1HQ

The directors present their strategic report of the company and the group for the year ended 31 March 2020.

Introduction

The company was incorporated on 10 November 2017 and the directors present their strategic report for the year ended 31 March 2020.

Following the acquisition of the Stretford Holdings Limited group and related undertakings in the period to 31March 2019 , the principal activity of the group remains the manufacture of paints, varnishes and similar coatings, mastics and sealants.

The principal activity of the company was that of a holding company.

Review of business

The Group is engaged in the development, testing and manufacture of functional coatings primarily for the industrial sector. Additionally, the Group is also engaged in toll manufacturing of industrial and decorative coatings on behalf of other paint companies.

The Group is reporting its second period of consolidated results following a significant restructuring which involved the following corporate transactions:-

-

The takeover of Stretford Holdings Limited, based in Gibraltar, by Trimite Top Co Limited, and the Group becoming domiciled in the UK

-

The acquisition of Firwood Paints Limited in Bolton, Lancashire

-

The buyout of Grebe AG minority share interests in Weillburger Coatings (UK) Limited and Carrs Coatings Limited and settlement of their shareholder loan

-

New additional equity being subscribed for £2,272,881

Significant one off costs were incurred by the Group as a result of the various transactions set out above in the period ended 31 March 2019. These had a material impact on the first period results.

The operating loss before amortisation and depreciation was £1,974,617.

Becoming a world-leading paint and coatings producer

Trimite Group is a dedicated paints and coatings producer. It has, however, taken a number of different forms and operated across a wide range of industries throughout its history. The current Group is the product of four UK paint companies:-

-

Trimite Limited (was Weilburger Coatings (UK) Limited)

-

Carrs Coatings Limited

-

Firwood Paints Limited

-

Trimite Technologies Limited

Each of these companies has its own history. Carrs can trace its origins to 1892 when the Carrs family set up their first paint site in Birmingham and Firwood Paints Limited was established in 1925.

Global premium customers have an increasing requirement for coatings of the highest standard and Trimite intends to be a significant supplier as these OEMs expand their range of products and volumes. The directors have confidence in the strength and ambition of these OEMs and will support them as an agile and flexible supplier delivering the highest of performance levels in both service and product. The Group continues to invest substantially in research and development activities, completing a number of process projects and bringing several new products into manufacture in this year and last. This R&D strategy is closely aligned to the Group's policy of continual investigation and investment in the latest production techniques and equipment, helping to differentiate Trimite from its competitors in terms of design, production ability and overall product quality. The shareholders and directors continually look for opportunities to grow the product range, increase the range of services and capabilities on offer to customers to expand into new markets. The board is confident that the Group has the necessary funding arrangements and support in place to achieve the objectives of the strategic business plan, with the aim of delivering long-term sustainable growth and enhanced performance.

The Company has a strong social corporate responsibility ethos and sponsors and holds regular events supporting the local community and charities.

Principal risks and uncertainties

The Group's principal financial instruments comprise an invoice discounting facility, loans issued by Duke Royalty UK Limited, other loan facilities, finance leases and cash. The main purpose of these financial instruments is to raise finance for the company's operations. The Group has various other financial instruments such as trade debtors and trade creditors; which arise from its operations. The Group does not enter into derivative transactions.

It is, and has been throughout the year under review, the Group's policy that no trading in financial instruments shall be undertaken. The main risks arising from the company's financial instruments are interest rate risk, liquidity risk and credit risk. The board reviews and agrees policies for managing each of these risks and they are summarised below:

Interest rate risk

The Group's exposure to market risk for changes in interest relate primarily to the invoice discounting facility and external loans. The Group's policy is to manage its interest cost using a mix of financial instruments on varying terms.

Liquidity risk

The Group's objective is to maintain a balance between continuity of funding and flexibility through the use of an invoice discounting facility and external borrowings. It should be noted that on 25th June 2019 an additional £1,000,000 equity funding was subscribed into the Group to provide additional liquidity. Furthermore, Duke Royalty UK Limited provided additional funding amounting to £1,000,000 in December 2019. In November 2020, Duke Royalty UK Limited entered into an arrangement with the Group to take £682,779 of equity in the Group in return for interest unpaid during the months of April 2020 through September 2020.

Credit risk

The Group trades with only recognised, credit worthy third parties. It is the Group's policy that all customers who wish to trade on credit terms are subject to credit vetting procedures. In addition, recoverable balances are monitored on an on-going basis with the result that the Group's exposure to bad debts is not significant.

Given the nature of the Group's business other risks include the following:

-

Competition selling similar products at lower prices

-

Ensuring that Group's UK based manufacturing costs are globally competitive

-

Exit from the EU resulting in difficult trading conditions

-

Global or regional recession reducing demand

-

Difficulty in maintaining margins in the face of commodity or exchange rate fluctuations

-

Product related legislation

-

Concentration of sales to individual customers or in individual sectors

-

Retention of key management and staff

Management continues to assess the risk and opportunities arising from the above and take action to mitigate any adverse impact.

Financial key performance indicators

The Group considers revenue, gross profit and operating profit as the key financial performance indicators with environmental impact and customer satisfaction as the key non-financial performance indicators.

Future developments

The Group's future success is dependent upon providing a consistent high quality, product range at competitive prices to a broad spectrum of customers across a number of markets to minimise risk. We also wish to broaden our offering to existing customers as well as seeking to service new customers and markets. The strong market growth we are seeing in China and India gives us confidence that we can develop our global footprint and the closure of the Hayes manufacturing site in December 2019 has been seen to generate cost savings in excess of £1m per annum.

Going concern

The directors have prepared detailed cashflow forecasts which extend to the period ending 31 March 2022 and show that the Group should have adequate resources to continue as a going concern. As stated above, the Group has carried out significant restructuring since its incorporation and the directors believe that the business is now stronger as a result and is well placed to absorb future opportunities and challenges that may present themselves. The Group's net debt position is carefully managed and the business retains an excellent relationship with the primary lender, Duke Royalty UK Limited, who remain supportive of the Group's medium term strategy and growth plans. Based on this review; the directors have concluded that it is appropriate for these financial statements to be prepared on a going concern basis.

This report was approved by the board and signed on its behalf.

On behalf of the board:

S P Thornhill - Director

26 March 2021

The directors present their report with the financial statements of the company and the group for the year ended 31 March 2020.

Dividends

No dividends will be distributed for the year ended 31 March 2020.

The loss for the period, after taxation, amounted to £4,337,109.

Events since the end of the year

Information relating to events since the end of the year is given in the notes to the financial statements.

Directors

The directors who have held office during the period from 1 April 2019 to the date of this report are as follows:

R Garea - appointed 13 August 2019

N A Johnson - appointed 26 November 2019

A Shivdasani - appointed 13 August 2019

S P Thornhill - appointed 26 November 2019

E F Kembery - appointed 13 August 2019 - resigned 11 October 2019

N E Smith was appointed as a director after 31 March 2020 but prior to the date of this report.

D G Roberts , A Shivdasani , R Garea and P J Westwood ceased to be directors after 31 March 2020 but prior to the date of this report.

Statement of directors' responsibilities

The directors are responsible for preparing the Group Strategic Report, the Report of the Directors and the financial statements in accordance with applicable law and regulations.

Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have elected to prepare the financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards and applicable law). Under company law the directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the company and the group and of the profit or loss of the group for that period. In preparing these financial statements, the directors are required to:

-	select suitable accounting policies and then apply them consistently;

-	make judgements and accounting estimates that are reasonable and prudent;

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

The directors are responsible for keeping adequate accounting records that are sufficient to show and explain the company's and the group's transactions and disclose with reasonable accuracy at any time the financial position of the company and the group and enable them to ensure that the financial statements comply with the Companies Act 2006. They are also responsible for safeguarding the assets of the company and the group and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities.

Statement as to disclosure of information to auditors

So far as the directors are aware, there is no relevant audit information (as defined by Section 418 of the Companies Act 2006) of which the group's auditors are unaware, and each director has taken all the steps that he ought to have taken as a director in order to make himself aware of any relevant audit information and to establish that the group's auditors are aware of that information.

Auditors

The auditors, Haines Watts Birmingham LLP, will be proposed for re-appointment at the forthcoming Annual General Meeting.

On behalf of the board:

S P Thornhill - Director

26 March 2021

Opinion

We have audited the financial statements of Trimite Top Co Limited (the 'parent company') and its subsidiaries (the 'group') for the year ended 31 March 2020 which comprise the Consolidated Statement of Comprehensive Income, Consolidated Balance Sheet, Company Balance Sheet, Consolidated Statement of Changes in Equity, Company Statement of Changes in Equity, Consolidated Cash Flow Statement and Notes to the Consolidated Cash Flow Statement, Notes to the Financial Statements, including a summary of significant accounting policies. The financial reporting framework that has been applied in their preparation is applicable law and United Kingdom Accounting Standards, including Financial Reporting Standard 102 'The Financial Reporting Standard applicable in the UK and Republic of Ireland' (United Kingdom Generally Accepted Accounting Practice).

In our opinion the financial statements:

-	give a true and fair view of the state of the group's and of the parent company affairs as at 31 March 2020 and of the group's loss for the year then ended;

-	have been properly prepared in accordance with United Kingdom Generally Accepted Accounting Practice; and

-	have been prepared in accordance with the requirements of the Companies Act 2006.

Basis for opinion

We conducted our audit in accordance with International Standards on Auditing (UK) (ISAs (UK)) and applicable law. Our responsibilities under those standards are further described in the Auditors' responsibilities for the audit of the financial statements section of our report. We are independent of the group in accordance with the ethical requirements that are relevant to our audit of the financial statements in the UK, including the FRC's Ethical Standard, and we have fulfilled our other ethical responsibilities in accordance with these requirements. We believe that the audit evidence we have obtained is sufficient and appropriate to provide a basis for our opinion.

Conclusions relating to going concern

We have nothing to report in respect of the following matters in relation to which the ISAs (UK) require us to report to you where:

-	the directors' use of the going concern basis of accounting in the preparation of the financial statements is not appropriate; or

-

the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the group's ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

However, not all future events or conditions can be predicted. The COVID-19 viral pandemic is one of the most significant economic events for the UK with unprecedented levels of uncertainty of outcomes. It is therefore difficult to evaluate all of the potential implications on the company's trade, customers, suppliers and wider economy. The Directors' view on the impact of COVID-19 is disclosed in the accounting policies note.

Other information

The directors are responsible for the other information. The other information comprises the information in the Group Strategic Report and the Report of the Directors, but does not include the financial statements and our Report of the Auditors thereon.

Our opinion on the financial statements does not cover the other information and, except to the extent otherwise explicitly stated in our report, we do not express any form of assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the other information and, in doing so, consider whether the other information is materially inconsistent with the financial statements or our knowledge obtained in the audit or otherwise appears to be materially misstated. If we identify such material inconsistencies or apparent material misstatements, we are required to determine whether there is a material misstatement in the financial statements or a material misstatement of the other information. If, based on the work we have performed, we conclude that there is a material misstatement of this other information, we are required to report that fact. We have nothing to report in this regard.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion, based on the work undertaken in the course of the audit:

-	the information given in the Group Strategic Report and the Report of the Directors for the financial year for which the financial statements are prepared is consistent with the financial statements; and

-	the Group Strategic Report and the Report of the Directors have been prepared in accordance with applicable legal requirements.

Matters on which we are required to report by exception

In the light of the knowledge and understanding of the group and the parent company and its environment obtained in the course of the audit, we have not identified material misstatements in the Group Strategic Report or the Report of the Directors.

We have nothing to report in respect of the following matters where the Companies Act 2006 requires us to report to you if, in our opinion:

-	adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

-	the parent company financial statements are not in agreement with the accounting records and returns; or

-	certain disclosures of directors' remuneration specified by law are not made; or

-	we have not received all the information and explanations we require for our audit.

Responsibilities of directors

As explained more fully in the Statement of Directors' Responsibilities set out on page five, the directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view, and for such internal control as the directors determine necessary to enable the preparation of financial statements that are free from material misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group's and the parent company's ability to continue as a going concern, disclosing, as applicable, matters related to going concern and using the going concern basis of accounting unless the directors either intend to liquidate the group or the parent company or to cease operations, or have no realistic alternative but to do so.

Auditors' responsibilities for the audit of the financial statements

Our objectives are to obtain reasonable assurance about whether the financial statements as a whole are free from material misstatement, whether due to fraud or error, and to issue a Report of the Auditors that includes our opinion. Reasonable assurance is a high level of assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will always detect a material misstatement when it exists. Misstatements can arise from fraud or error and are considered material if, individually or in the aggregate, they could reasonably be expected to influence the economic decisions of users taken on the basis of these financial statements.

A further description of our responsibilities for the audit of the financial statements is located on the Financial Reporting Council's website at www.frc.org.uk/auditorsresponsibilities. This description forms part of our Report of the Auditors.

Use of our report

This report is made solely to the company's members, as a body, in accordance with Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so that we might state to the company's members those matters we are required to state to them in a Report of the Auditors and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company and the company's members as a body, for our audit work, for this report, or for the opinions we have formed.

ANDREW JONES (Senior Statutory Auditor)

for and on behalf of Haines Watts Birmingham LLP

5-6 Greenfield Crescent

Edgbaston

Birmingham

B15 3BE

26 March 2021

Turnover

15,764,762

20,303,762

Cost of sales

(10,379,264

)

(13,618,874

)

Gross profit

5,385,498

6,684,888

Distribution costs

(794,135

)

(843,269

)

Administrative expenses

(7,005,896

)

(6,979,248

)

(2,414,533

)

(1,137,629

)

Exceptional income/(expenses)

(507,925

)

310,090

Operating loss

5

(2,922,458

)

(827,539

)

Interest receivable and similar income

7

-

436,454

(2,922,458

)

(391,085

)

Interest payable and similar expenses

8

(1,473,181

)

(3,194,097

)

Loss before taxation

(4,395,639

)

(3,585,182

)

Tax on loss

9

58,530

140,799

Loss for the financial year

(4,337,109

)

(3,444,383

)

Other comprehensive income

Defined benefit pension gains/(losses)

(166,000

)

22,000

Income tax relating to other comprehensive income

-

-

Other comprehensive income for the year, net of income tax

(166,000

)

22,000

Total comprehensive income for the year

(4,503,109

)

(3,422,383

)

Loss attributable to:

Owners of the parent

(4,337,109

)

(3,444,383

)

Total comprehensive income attributable to:

Owners of the parent

(4,503,109

)

(3,422,383

)

Fixed assets

Intangible assets

11

5,866,851

6,606,344

Tangible assets

12

1,671,243

2,379,368

Investments

13

-

-

7,538,094

8,985,712

Current assets

Stocks

14

1,883,689

2,393,043

Debtors

15

4,135,970

5,160,546

Cash at bank

556,001

502,610

6,575,660

8,056,199

Creditors

Amounts falling due within one year

16

6,907,008

7,152,149

Net current (liabilities)/assets

(331,348

)

904,050

Total assets less current liabilities

7,206,746

9,889,762

Creditors

Amounts falling due after more than one year

17

(12,218,500

)

(11,538,407

)

Pension liability

22

(140,000

)

-

Net liabilities

(5,151,754

)

(1,648,645

)

Capital and reserves

Called up share capital

20

1,772

1,401

Share premium

21

3,271,109

2,271,480

Retained earnings

21

(8,424,635

)

(3,921,526

)

Shareholders' funds

(5,151,754

)

(1,648,645

)

The financial statements were approved by the Board of Directors and authorised for issue on 26 March 2021 and were signed on its behalf by:

S P Thornhill - Director

Fixed assets

Intangible assets

11

-

-

Tangible assets

12

-

-

Investments

13

1

1

1

1

Current assets

Debtors

15

3,045,201

2,043,333

Creditors

Amounts falling due within one year

16

145,866

143,998

Net current assets

2,899,335

1,899,335

Total assets less current liabilities

2,899,336

1,899,336

Creditors

Amounts falling due after more than one year

17

1,351,698

1,351,698

Net assets

1,547,638

547,638

Capital and reserves

Called up share capital

20

1,772

1,401

Share premium

21

3,271,109

2,271,480

Retained earnings

21

(1,725,243

)

(1,725,243

)

Shareholders' funds

1,547,638

547,638

Company's loss for the financial year

-

(1,725,243

)

The financial statements were approved by the Board of Directors and authorised for issue on 26 March 2021 and were signed on its behalf by:

S P Thornhill - Director

Called up

share

Retained

Share

Total

capital

earnings

premium

equity

£

£

£

£

Changes in equity

Acquisition of minority

interest

-

(499,143

)

-

(499,143

)

Shares issued during the

period

1,401

-

2,271,480

2,272,881

Total comprehensive income

-

(3,422,383

)

-

(3,422,383

)

Balance at 31 March 2019

1,401

(3,921,526

)

2,271,480

(1,648,645

)

Changes in equity

Issue of share capital

371

-

999,629

1,000,000

Total comprehensive income

-

(4,503,109

)

-

(4,503,109

)

Balance at 31 March 2020

1,772

(8,424,635

)

3,271,109

(5,151,754

)

Called up

share

Retained

Share

Total

capital

earnings

premium

equity

£

£

£

£

Changes in equity

Issue of share capital

1,401

-

2,271,480

2,272,881

Total comprehensive income

-

(1,725,243

)

-

(1,725,243

)

Balance at 31 March 2019

1,401

(1,725,243

)

2,271,480

547,638

Changes in equity

Issue of share capital

371

-

999,629

1,000,000

Balance at 31 March 2020

1,772

(1,725,243

)

3,271,109

1,547,638

Cash flows from operating activities

Cash generated from operations

1

(688,600

)

(1,006,635

)

Interest paid

(1,472,293

)

(1,128,700

)

Interest element of hire purchase payments paid

(888

)

(10,819

)

Tax paid

(1

)

-

Taxation refund

80,523

-

Net cash from operating activities

(2,081,259

)

(2,146,154

)

Cash flows from investing activities

Purchase of tangible fixed assets

(196,514

)

(80,989

)

Sale of tangible fixed assets

691,053

820,001

Proceeds from sale of Stetford Holdings

-

6,761,330

Net cash outflow on acquisitions

-

(3,610,307

)

Preference dividends paid

-

(130,260

)

Net cash from investing activities

494,539

3,759,775

Cash flows from financing activities

New loans in year

1,000,000

11,499,000

Repayment of loans due to shareholders

-

(13,939,423

)

Capital repayments in year

(339,443

)

(614,792

)

Share issue

1,000,000

2,272,881

New hire purchase agreements

-

18,251

Hire purchase repayments

(20,446

)

(13,159

)

Debt issue costs

-

(755,517

)

Invoice financing draw downs

-

421,748

Net cash from financing activities

1,640,111

(1,111,011

)

Increase in cash and cash equivalents

53,391

502,610

Cash and cash equivalents at beginning of year

2

502,610

-

Cash and cash equivalents at end of year

2

556,001

502,610

1.	Reconciliation of loss before taxation to cash generated from operations

Period

10/11/17

Year Ended

to

31/3/20

31/3/19

£

£

Loss before taxation

(4,395,639

)

(3,585,182

)

Depreciation charges

947,841

1,112,076

Profit on disposal of fixed assets

(564

)

(145,716

)

Exceptional license disposal proceeds

-

(709,402

)

Shortfall of normal pension contribution

(166,000

)

22,000

Finance costs

1,473,181

3,194,097

Finance income

-

(436,454

)

(2,141,181

)

(548,581

)

Decrease in stocks

509,354

221,818

Decrease in trade and other debtors

1,139,417

1,615,360

Decrease in trade and other creditors

(196,190

)

(2,295,232

)

Cash generated from operations

(688,600

)

(1,006,635

)

2.	Cash and cash equivalents

The amounts disclosed on the Cash Flow Statement in respect of cash and cash equivalents are in respect of these Balance Sheet amounts:

Year ended 31 March 2020

31/3/20

1/4/19

£

£

Cash and cash equivalents

556,001

502,610

Period ended 31 March 2019

31/3/19

10/11/17

£

£

Cash and cash equivalents

502,610

-

3.	Analysis of changes in net debt

At 1/4/19

Cash flow

At 31/3/20

£

£

£

Net cash

Cash at bank

502,610

53,391

556,001

502,610

53,391

556,001

Debt

Finance leases

(36,361

)

20,446

(15,915

)

Debts falling due within 1 year

(278,763

)

(910

)

(279,673

)

Debts falling due after 1 year

(11,538,407

)

(680,093

)

(12,218,500

)

(11,853,531

)

(660,557

)

(12,514,088

)

Total

(11,350,921

)

(607,166

)

(11,958,087

)

1.	Statutory information

Trimite Top Co Limited is a private company, limited by shares , registered in England and Wales. The company's registered number and registered office address can be found on the General Information page.

2.	Accounting policies

Basis of preparing the financial statements

These financial statements have been prepared in accordance with Financial Reporting Standard 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland" and the Companies Act 2006. The financial statements have been prepared under the historical cost convention.

The following principal accounting policies have been applied:

Going concern

The Directors have prepared detailed cashflow forecasts which extend to the period ending 31 March 2022 and show that the Group should have adequate resources to continue as a going concern. The Group has carried out significant restructuring since its incorporation and the Directors believe that the business is now stronger as a result and is well placed to absorb future opportunities and challenges that may present themselves. The Group's net debt position is carefully managed and the business retains an excellent relationship with the primary lender, Duke Royalty UK Limited, who remain supportive of the Group's medium term strategy and growth plans. Based on this review, the Directors have concluded that it is appropriate for these financial statements to be prepared on a going conern basis.

In response to the COVID-19 pandemic, the Directors have tested their cash flow analysis to take into account the impact on their business of possible scenarios brought on by the impact of COVID-19, alongside the measures that they can take to mitigate the impact. Based on these assessments, given the measures that could be undertaken to mitigate the current adverse conditions, and the current resources available, the Directors have concluded that they can continue to adopt the going concern basis in preparing the annual report and accounts.

Financial Reporting Standard 102 - reduced disclosure exemptions

The group has taken advantage of the following disclosure exemptions in preparing these financial statements, as permitted by FRS 102 "The Financial Reporting Standard applicable in the UK and Republic of Ireland":

•

the requirements of paragraphs 11.42, 11.44, 11.45, 11.47, 11.48(a)(iii), 11.48(a)(iv), 11.48(b) and 11.48(c);

•

the requirements of paragraphs 12.26, 12.27, 12.29(a), 12.29(b) and 12.29A.

Basis of consolidation

The consolidated financial statements include the financial statements of the Company and its subsidiary undertakings made up to 31 March 2020. A subsidiary is an entity that is controlled by the parent. The results of subsidiary undertakings are included in the consolidated profit and loss account from the date that control commences until the date that control ceases. Control is established when the Company has the power to govern the operating and financial policies of an entity so as to obtain benefits from its activities. In assessing control, the Group takes into consideration potential voting rights that are currently exercisable.

The acquisition method of accounting has been used to show the consolidated results of the group for the period ended 31 March 2020.

Under Section 408 of the Companies Act 2006 the Company is exempt from the requirement to present its own profit and loss account.