1 year ago

Keepmoat Annual Report 2020

  • Text
  • Lease
  • Keepmoat
  • Strategic
  • Annual
  • Income
  • Assets
  • Limited
  • Homes
  • Statements
  • October
Keepmoat has released its Group financial results for the year ending 31 October 2020.


FINANCIAL STATEMENT Directors’ Report The directors present their annual report, the consolidated audited financial statements of the Group for the year ended 31 October 2020. Principal activities Keystone JVco Limited is the ultimate UK based parent company of a Group of Companies formed to facilitate the acquisition of Lakeside 1 Limited, the ultimate parent of the Keepmoat Group at the time, by funds managed by TDR Capital LLP and Sun Capital Partners Limited, in November 2014. The Company continues to be an investment holding Company heading a Group of Companies which are engaged in the construction of residential dwellings. The Company’s subsidiaries are listed in note 23 to the financial statements. Business review and future developments The consolidated loss for the financial year was £14.4m (year ended 31 October 2019 profit of: £30.7m). The Company did not pay a dividend during the year (year ended 31 October 2019: £nil) and no final dividend is proposed (31 October 2019: £nil). A review of the results, performance and future developments for the Group are presented in the Strategic Report on pages 7 to 62 which forms part of this report. Post balance sheet events On 11 December 2020 Castle 1 Limited, a Keystone JVco Limited subsidiary, acquired BDW Trading Limited’s 50% members’ capital holding in BK Scotswood LLP for £2.0m. Going concern The Group’s business activities, together with the factors likely to affect its future development, are set out in the Strategic Report on pages 7 to 62. The financial position of the Group, its cash flows and borrowing facilities are described on page 61 of the Strategic Report. Having considered the Group’s forecasts including its forecast cashflows, the directors are satisfied that the Company has sufficient liquidity and covenant headroom to enable the Group to conduct its activities and meet its liabilities as they fall due for the foreseeable future being at least twelve months. Accordingly, these financial statements are prepared on the going concern basis. Further details of the Directors’ assessment of going concern can be found in the principal accounting policies on pages 73 to 79. Financial risk management In the course of its ordinary activities, the Group is exposed to financial risks which include liquidity, credit and interest rate risks. These risks are monitored and managed through robust policies and procedures. Further details are included in note 22 of the financial statements. Liquidity risk relates to the Group generating sufficient cash flow to meet its operational requirements while avoiding debt covenant breaches or excessive debt levels. Total borrowings are a combination of long-term loans and long term committed revolving working capital credit facilities. Credit risk is in relation to trade receivables from customers. Given that the majority of trade receivables are with public and regulated organisations, the exposure to credit risk is very limited. Interest rate risk relates to the impact of interest rate increases on the Group’s floating rate borrowings. Following the Group’s refinancing on 11 December 2018 the Group’s term loan, revolving credit and overdraft facilities are all on floating rates. The Group’s interest rate risk has increased following completion of refinancing. Directors The directors who held office during the period and up to the date of signing the financial statements are given below: M A Budd (resigned 20th March 2020) S J Robertson J W Mitchell (appointed 24th April 2020) E J C Hawkes All the above directors are representatives of the Company’s shareholders, being TDR Capital LLP, which has effective control of 85% of the issued share capital of the Company or Sun Capital Partners Limited which has effective control of the remaining 15%. In accordance with the Articles of Association, none of the directors are required to retire by rotation. Employees The Group believes that its success depends upon its employees and their development. Further details are provided within the Strategic Report. 64 KEEPMOAT.COM

DIRECTORS’ REPORT Directors’ indemnities The Group maintains liability insurance for its directors and officers which remains in place up to the date of this Annual Report. The Group has also provided an indemnity for its directors, which is a qualifying third-party indemnity provision for the purposes of the Companies Act 2006. 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 regulation. Company law requires the directors to prepare financial statements for each financial year. Under that law the directors have prepared the group financial statements in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice (United Kingdom Accounting Standards, comprising FRS 101 “Reduced Disclosure Framework”, and applicable law). Under company law, 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; • state whether international accounting standards in conformity with the requirements of the Companies Act 2006 have been followed for the group financial statements and United Kingdom Accounting Standards, comprising FRS 101 have been followed for the company financial statements, subject to any material departures disclosed and explained in the financial statements; • make judgements and accounting estimates that are reasonable and prudent; and • prepare the financial statements on the going concern basis unless it is inappropriate to presume that the group and company will continue in business. The directors are responsible for the maintenance and integrity of the company’s website. Legislation in the United Kingdom governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions. Directors’ confirmations In the case of each director in office at the date the directors’ report is approved: • so far as the director is aware, there is no relevant audit information of which the group’s and company’s auditors are unaware; and • they 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’s and company’s auditors are aware of that information. Walker guidelines The directors consider the annual report and financial statements to comply with all aspects of the guidelines for transparency and disclosure in private equity owned companies. Independent auditors PricewaterhouseCoopers LLP have indicated their willingness to continue in office. Approved by and signed on behalf of the Board. E J C Hawkes Director 28 February 2021 The directors 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 keeping adequate accounting records that are sufficient to show and explain the group’s 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. ANNUAL REPORT & FINANCIAL STATEMENTS 2020 65