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Keepmoat Annual Report 2020

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  • Keepmoat
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  • Homes
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  • October
Keepmoat has released its Group financial results for the year ending 31 October 2020.

NOTES TO THE

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 11 – Inventories 31 October 2020 31 October 2019 £’000 £’000 Land held for and under development 219,749 199,948 House building developments in progress 247,033 207,939 466,782 407,887 The Group carries out a detailed annual review of the net realisable value of land held for and under development both relating to plots currently in development, and land and phases of sites not yet in development. Net realisable value for land where construction of homes had commenced at the year-end or is anticipated to commence within the next 12 months was assessed by estimating selling prices and costs (including sales and marketing expenses) taking into account current market conditions. Land where house building had not commenced at the year-end and was more likely to be sold undeveloped is assessed by re-appraising the land using current selling prices and costs for the proposed development and assuming an appropriate financial return to reflect the current housing market conditions and the prevailing financing environment. At the year-end, the net realisable value provision amounts to £nil (31 October 2019: £nil). This provision will be closely monitored for adequacy and appropriateness as regards under and over provision to reflect circumstances at future balance sheet dates. Government grants are recognised within inventories and are allocated to the income statement over the useful lives of the related assets. The effect of this treatment is to reduce the fair value of inventories by £7,421,000 (31 October 2019: £11,665,000) and to reduce cost of sales in the income statement by £1,379,000 (31 October 2019: £2,299,000). Included within inventories are £0.2m of part exchange properties (31 October 2019: £0.3m). Part exchange properties of £2.1m (31 October 2019: £0.1m) were disposed of during the year for proceeds of £2.1m (31 October 2019: £0.1m). 12 – Trade and other receivables 31 October 2020 31 October 2019 £’000 £’000 Non-current: Amounts due from related party undertakings (note 23) 5,732 5,069 Prepayments 1,024 1,789 Current: 6,756 6,858 Trade receivables 15,958 14,486 Less: provision for impairment of receivables (237) (787) Trade receivables – net of provision for impairment 15,721 13,699 Amounts due from related party undertakings (note 23) 2,799 4,221 Other receivables 6,077 8,699 Prepayments 5,451 4,382 Contract assets 15,265 13,512 Other receivables include £nil of restricted cash (31 October 2019: £5.0m). 45,313 44,513 Prepayments includes £1.4m of unamortised issue costs associated with the revolving credit facility as the group was not drawn on the facility. In the year ended 31 October 2019 these are included in issue costs within loans and borrowings to net off against the drawn facility at that date (note 16). 92 KEEPMOAT.COM

FINANCIAL REVIEW 12 – Trade and other receivables (continued) Movements on the Group provision for impairment of trade receivables are as follow: 31 October 2020 31 October 2019 £’000 £’000 As at 1 November 787 1,569 Credited to the income statement (550) (782) As at 31 October 237 787 Provisions for impaired receivables have been included in cost of sales in the income statement. Consideration of the credit quality of trade receivables is set out under credit risk in note 22. 13 – Cash and cash equivalents (excluding bank overdrafts) 31 October 2020 31 October 2019 £’000 £’000 Cash at bank and in hand 57,040 41,484 Cash and cash equivalents include the following for the purposes of the consolidated cash flow statement: 31 October 2020 31 October 2019 £’000 £’000 Cash at bank and in hand 57,040 41,484 Bank overdrafts (note 16) (254) (6,311) Cash and cash equivalents 56,786 35,173 ANNUAL REPORT & FINANCIAL STATEMENTS 2020 93