TIDMCEPS
RNS Number : 4785V
CEPS PLC
13 December 2021
13 December 2021
CEPS PLC
("CEPS" or the "Company")
Pension scheme, extension of existing related party loans and
general trading update
Pension Scheme
CEPS announces that the Trustee of the Company's defined benefit
scheme (Dinkie Heel plc Retirement Benefits Scheme (the "Scheme"))
has entered into a buy-in contract with Aviva. This will provide
long-term security for the benefits of all of the members of the
Scheme and also removes longevity, investment and funding risks in
the Scheme. The current expectation is that the contract will
convert to a full buy-out policy in due course without the need for
any additional financial support from the Company. Although
supportive of the decision of the Trustees to enter into the buy-in
contract, this was a decision made by the Trustees and not one that
could be taken by CEPS.
The Scheme is expected to go into formal winding up as soon as
possible once data cleansing and Guaranteed Minimum Pension
equalisation is complete. It is possible that at this time a
surplus arising from the excess of Scheme assets over Scheme
liabilities, will be repaid to CEPS, but at the moment it is too
early to determine how much this will be. A further announcement
will be made when there is more certainty about the figure.
There is no impact on the Company's balance sheet as a
consequence of this transaction as the actuarial surplus on the
Scheme has not been recognised as the Company does not have an
unconditional right to refunds of surpluses arising in the Scheme.
However, it will mean that CEPS will, in due course, no longer need
to expense costs and professional fees in relation to the
administration of the Scheme. Moreover, the uncertainty of whether
the Company will need to make-good any future deficit in the Scheme
will be removed. Both these actions will have a positive impact on
future cash.
Extension of Existing Related Party Loans
1. On 20 May 2021 the Company announced that it had secured a
third-party loan for GBP2,000,000 which was repayable on or before
30 June 2022 (the "Loan"). The Loan has been extended such that it
is repayable on or before 30 June 2025. All other terms of the Loan
remain the same including the annual interest rate of 7 per cent.
accruing daily and payable in arrears on 31 March, 30 June, 30
September and 31 December.
CEPS' obligations in respect of the Loan have been guaranteed by
Mr David Horner, a director of the Company. Given that David Horner
is a director of the Company, the provision of the guarantee is
considered to be a related party transaction pursuant to AIM Rule
13. The directors of the Company who are considered independent for
the purposes of the Loan, being Geoff Martin, David Johnson and
Vivien Langford, having consulted with the Company's nominated
adviser, Cairn Financial Advisers LLP, consider the guarantee of
the Loan by David Horner to be fair and reasonable insofar as the
Company's shareholders are concerned.
2. The repayment date of the loan from Chelverton Asset
Management Limited (the "CAM Loan"), which now stands at
GBP2,950,000 after the repayment of the short-term element of the
CAM Loan of GBP150,000 made possible by the equity placing on 17
September 2021, has been extended from 31 March 2022 to 31 March
2023. All other terms of the CAM Loan remain the same including
that it carries an interest rate of 5 per cent. accruing daily and
payable in arrears on 31 March, 30 June, 30 September and 31
December.
CEPS' obligations in respect of the CAM Loan have been
guaranteed by Mr David Horner. As David Horner is a director of the
Company and, therefore, deemed to be a related party pursuant to
the AIM Rules for Companies, is a 14.06% shareholder and, together
with his family, owns 55.25% of CAM Holdings Limited, which owns
100% of CAM (which is, therefore, itself a related party), both the
extension of the CAM Loan, and the provision of the guarantee, are
considered to be related party transactions pursuant to AIM Rule
13. The directors of the Company who are considered independent for
the purposes of the CAM Loan, being Geoff Martin, David Johnson and
Vivien Langford, having consulted with the Company's nominated
adviser, Cairn Financial Advisers LLP, consider the CAM Loan and
the guarantee of the CAM Loan by David Horner to be fair and
reasonable insofar as the Company's shareholders are concerned.
Trading Update
As the Company is approaching its financial year end of 31
December 2021, it is useful to provide a trading update. The Board
of CEPS is confident that all segments will perform better than in
the previous year, notwithstanding the well-publicised challenges
in the British economy, and are well placed to deliver good growth.
No further significant acquisitions in new segments are anticipated
over the next two years while the Company focuses on enhancing its
existing portfolio companies through both organic growth and
bolt-on acquisitions.
In addition, further to the announcement made on 15 March 2022
relating to the acquisition by Hickton Group Limited ("HGL") of
Millington Lord Limited ("MLL"), the additional GBP100,000 of
earn-out consideration, the payment of which was dependent on the
combined MLL group achieving certain turnover targets over the
period from 15 March 2022 to 31 August 2021, has been paid. The
payment was funded from existing cash resources within HGL.
This announcement contains inside information for the purposes
of Article 7 of EU Regulation 596/2014 (which forms part of
domestic UK law pursuant to the European Union (Withdrawal) Act
2018).
The Directors of the Company accept responsibility for the
content of this announcement.
Enquiries
CEPS PLC
Vivien Langford, Group Finance
Director +44 1225 483030
Cairn Financial Advisers LLP
James Caithie / Sandy Jamieson
/ Ludovico Lazzaretti +44 20 7213 0880
Caution regarding forward looking statements
Certain statements in this announcement, are, or may be deemed
to be, forward looking statements. Forward looking statements are
identi ed by their use of terms and phrases such as "believe",
"could", "should" "envisage", "estimate", "intend", "may", "plan",
"potentially", "expect", "will" or the negative of those,
variations or comparable expressions, including references to
assumptions. These forward-looking statements are not based on
historical facts but rather on the Directors' current expectations
and assumptions regarding the Company's future growth, results of
operations, performance, future capital and other expenditures
(including the amount, nature and sources of funding thereof),
competitive advantages, business prospects and opportunities. Such
forward looking statements re ect the Directors' current beliefs
and assumptions and are based on information currently available to
the Directors .
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END
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(END) Dow Jones Newswires
December 13, 2021 09:59 ET (14:59 GMT)
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