TIDMMRS
RNS Number : 9589Z
Management Resource Solutions PLC
20 December 2017
Management Resource Solutions plc
EPIC: MRS
20 December 2017
Management Resource Solutions plc
("MRS" or "the Company")
Results for the year ended 30 June 2017 and trading update
Management Resources Solutions plc, the company which provides
plant hire and civil earthworks services in Southern Queensland and
coal industry support services in the Hunter Valley of New South
Wales is pleased to announce its results for the year ended 30 June
2017 and to provide an update on current trading.
Financial Results for the year ended 30 June 2017
All references to dollars or $ relate to Australian dollars, the
Group's presentational currency.
The results for the financial year to 30 June 2017 ('FY17' or
'2017'), of a Net Loss After Tax of $10.8m (2016: Net Loss After
Tax $4.6m) on Revenue of $52.4m (2016: $13.3m), reflect a
significant restructuring of the MRS Group during the year, with
$4.2m (2016: $nil) of the loss relating to restructuring costs and
discontinued operations.
As previously reported in several RNS announcements including
the FY16 Annual Report issued on 30 March 2017, FY17 saw the
acquisition of various assets from SubZero Group Limited on 30
September 2016, and the closure of the consulting business in
November 2016. Also, as a result of the need to quarantine the
group from the high risk underperforming contracts in Papua New
Guinea and at Rosehill, Sydney, MRS Guernsey Limited (the operating
entity of the Papua New Guinea contract), Management Resource
Solutions Pty Ltd and MRS PNG Limited were placed into voluntary
liquidation on 15 December 2016, 7 February 2017, and 17 February
2017 respectively.
As part of this restructuring the continuing operations,
comprising Bachmann Plant Hire Pty Ltd ("BPH") and MRS Subzero Pty
Ltd (trading as MRS Services Group, "MRSSG") were transferred to a
new holding company, Holdings (MRS) Pty Ltd ("HMRS").
In addition, both the Board and Executive Management underwent
considerable change, and a Placing to re-finance the business was
undertaken in April 2017, enabling the shares to return from
suspension in May 2017.
As a result, the FY17 results include considerable non-recurring
costs. Furthermore, the continuing operations of the MRS Group
(being the holding companies MRS PLC and HMRS plus the two
operations, BPH and MRSSG) have significantly changed from what was
presented in the FY16 Annual Report. The focus has changed from
oil, gas and construction industries to a strong presence in plant
hire and civil earthworks around Ipswich in Southern Queensland
(BPH) and coal industry support services in the Hunter Valley of
New South Wales (MRSSG).
Net Profit/(Loss) After
Tax - A$'000s FY17 FY17 FY16
------------------------ --------- --------
Continuing Business
------------------------------------- -------------
Discontinued
Operating Restructuring Combined Business Total Total
---------- -------------- --------- ------------- --------- --------
MRS PLC (1,182) (3,877) (5,060) (5,592) (10,652) (369)
HMRS (462) 346 (115) (1,649) (1,764) 0
BPH 1,503 0 1,503 (1,548) (45) (174)
MRSSG (6,404) (1,029) (7,434) (25) (7,459) 0
---------- -------------- --------- ------------- --------- --------
(6,546) (4,561) (11,106) (8,814) (19,920) (543)
---------- -------------- --------- ------------- --------- --------
MRS Pty
Ltd 0 7,847 7,847 (3,042)
MRSG Pty
Ltd 0 718 718 (811)
MRSPNG
Ltd 0 570 570 (204)
--------- ------------- --------- --------
0 9,135 9,135 (4,057)
--------- ------------- --------- --------
Net profit/(loss) after
tax (11,106) 321 (10,785) (4,600)
--------- ------------- --------- --------
The full Report and Accounts for the year ended 30 June 2017 are
attached and available to download from the Company's website at
www.mrsplc.info and will be posted to shareholders shortly.
Trading Update and Outlook
The markets which BPH and MRSSG service are the strongest they
have been in years. BPH is currently working at fully capacity and
has a strong pipeline of work to complete. MRSSG is experiencing
strong demand, with revenues now exceeding $4.0m per month.
The Hunter Valley thermal coal price has been strong and stable
providing confidence for the coal mines to commit to repairs and
maintenance and Yancoal has recently completed the acquisition of
the Rio Tinto assets in the Hunter Valley.
Both BPH and MRSSG were run as separate operations with little
interaction or utilisation of shared services and group purchasing
during the financial years 2015-16 ('FY16') and 2016-17 ('FY17').
During late FY17 and 2017-17 ('FY18') the new Board prioritised
significant cost cutting and restructuring, and has restructured
the senior management, which now includes Group Human Resources,
Group Asset Management, Group Procurement and Group Financial
Management. Further changes include the recent recruitment of a
General Manager - Civil and Earthworks, as part of succession
planning at BPH.
The cost cutting and restructuring programme is now
substantially complete. As the drive to grow revenues continues,
the Board is committed to focusing on earnings growth and
shareholder value for the remainder of FY18 and beyond.
For FY18, first half expectations are for Profit after Tax and
earnings per share to exceed $2.2m and 0.8p respectively, whilst
for the full year earnings per share of not less than 2.0p are in
prospect.
Further progress is anticipated in 2018-19 as debt continues to
be repaid from the strong operational cash-flow generated by the
major changes which are now taking effect.
On behalf of the Board, I'd like to thank all employees for
their continued commitment to working safely and to all
stakeholders of MRS including employees, customers, suppliers,
funders and shareholders for maintaining their support for the
Company.
For further information:
Management Resource Solutions plc
John Zorbas, Chairman +1 778 938-7631
Nigel Burton, Director +44 7785 234447
Trevor Brown, Director +41 7941 55384
Northland Capital Partners Limited +44 (0) 20 3861 6625
(Nominated Adviser and Joint Broker)
Tom Price
Gerry Beaney
Peterhouse Corporate Finance Limited +44 (0)20 7469 0932
(Joint Broker)
Charles Goodfellow
Lucy Williams
This announcement includes inside information as defined in
Article 7 of the Market Abuse Regula􀆟on No. 596/2014
and is disclosed in accordance with the Company's obligations under
Article 17 of those Regulations. On the publication of this
announcement via a Regulatory Information Service ("RIS"), this
information is considered to be in the public domain.
About MRS
Management Resource Solutions plc (MRS), through its
subsidiaries Bachmann Plant Hire and MRS Services Group, offers
plant hire, equipment repair, refurbishment and fabrication, mine
rehabilitation, earthmoving, road construction and other support
services to a wide base of private and public sector clients in
Australia. MRS caters predominately for the mining, civil
engineering, construction and infrastructure industries.
Further information on the Company can be found at
http://www.mrsplc.info
Management Resource Solutions PLC
Annual Report
Year Ended
30 June 2017
Company number: 8046513
Management Resource Solutions PLC
Annual Report
for the year ended 30 June 2017
Officers and
advisers.......................................................................................................
1
Chairman's Statement and Strategic
Report...................................................................
2
Directors'
Report.............................................................................................................
6
Statement of directors'
responsibilities.........................................................................
11
Independent auditor's
report.........................................................................................
12
Consolidated Statement of profit and loss and other
comprehensive income............... 17
Consolidated Balance Sheet18
Consolidated Statement of Changes in Equity19
Consolidated Statement of Cash Flow20
Notes to the consolidated financial statements21
Parent company Balance Sheet52
Parent company Statement of Changes in Equity53
Notes to the parent company Balance Sheet54
Management Resource Solutions PLC
Officers and advisers
Directors
John Zorbas Chairman
Timothy Jones Finance Director
Nigel Burton Non-Executive Director
Trevor Brown Non-Executive Director
Company secretary
Timothy Jones
Registered number
8046513
Registered office
Reading Bridge House, George Street, Reading, Berkshire, RG1
8LS
United Kingdom
Australian office
2/2 Market Street, Newcastle, NSW 2300, Australia
Nominated adviser and joint broker
Northland Capital Partners Limited, 60 Gresham Street, London,
EC2V 7BB,
United Kingdom
Joint broker
Peterhouse Corporate Finance Limited, 15-17 Eldon Street,
London, EC2M 7LD,
United Kingdom
Auditors
James Cowper Kreston, Reading Bridge House, George Street,
Reading, Berkshire, RG1 8LS
United Kingdom
Solicitors as to English Law
Memery Crystal LLP, 44 Southampton Buildings, London, WC2A
1AP,
United Kingdom
Solicitors as to Australian Law
McCullough Robertson, 66 Eagle Street, Brisbane, QLD 4000,
Australia
Share registry
Equiniti, Aspect House, Spencer Road, Lancing, West Sussex, BN99
6DA,
United Kingdom
Websites
www.mrsplc.info
www.mrsplc.net
www.bph.net.au
www.mrssg.net
Management Resource Solutions PLC
Chairman's Statement and Strategic Report
Dear Shareholders,
Financial Results and Financial Key Performance Indicators
All references to dollars or $ relate to Australian dollars, the
Group's presentational currency.
The results for the financial year to 30 June 2017 ('FY17' or
'2017'), of a Net Loss After Tax of $10.8m (2016: Net Loss After
Tax $4.6m) on Revenue of $52.4m (2016: $13.3m), reflect a
significant restructuring of the MRS Group during the year, with
$4.2m (2016: $nil) of the loss relating to restructuring costs and
discontinued operations.
As previously reported in several RNS announcements including
the FY16 Annual Report issued on 30 March 2017, FY17 saw the
acquisition of various assets from SubZero Group Limited on 30
September 2016, the closure of the consulting business in November
2016, and as a result of the need to quarantine the group from the
high risk underperforming contracts in Papua New Guinea and at
Rosehill, Sydney, MRS Guernsey Limited (the operating entity of the
Papua New Guinea contract), Management Resource Solutions Pty Ltd
and MRS PNG Limited being placed into voluntary liquidation on 15
December 2016, 7 February 2017, and 17 February 2017
respectively.
As part of this restructuring the continuing operations,
comprising Bachmann Plant Hire Pty Ltd ("BPH") and MRS Subzero Pty
Ltd (trading as MRS Services Group, "MRSSG") were transferred to a
new holding company, Holdings (MRS) Pty Ltd ("HMRS").
In addition, both the Board and Executive Management underwent
considerable change, and a Placing to re-finance the business was
undertaken in April 2017, enabling the shares to return from
suspension in May 2017.
As a result, the FY17 results include considerable non-recurring
costs. Furthermore, the continuing operations of the MRS Group
(being the holding companies MRS PLC and HMRS plus the two
operations, BPH and MRSSG) have significantly changed from what was
presented in the FY16 Annual Report. The focus has changed from
oil, gas and construction industries to a strong presence in plant
hire and civil earthworks around Ipswich in Southern Queensland
(BPH) and coal industry support services in the Hunter Valley of
New South Wales (MRSSG).
Net Profit/(Loss) After
Tax - A$'000s FY17 FY17 FY16
------------------------ --------- --------
Continuing Business
------------------------------------- -------------
Discontinued
Operating Restructuring Combined Business Total Total
---------- -------------- --------- ------------- --------- --------
MRS PLC (1,182) (3,877) (5,060) (5,592) (10,652) (369)
HMRS (462) 346 (115) (1,649) (1,764) 0
BPH 1,503 0 1,503 (1,548) (45) (174)
MRSSG (6,404) (1,029) (7,434) (25) (7,459) 0
---------- -------------- --------- ------------- --------- --------
(6,546) (4,561) (11,106) (8,814) (19,920) (543)
---------- -------------- --------- ------------- --------- --------
MRS Pty
Ltd 0 7,847 7,847 (3,042)
MRSG Pty
Ltd 0 718 718 (811)
MRSPNG
Ltd 0 570 570 (204)
--------- ------------- --------- --------
0 9,135 9,135 (4,057)
--------- ------------- --------- --------
Net profit/(loss) after
tax (11,106) 321 (10,785) (4,600)
--------- ------------- --------- --------
Management Resource Solutions PLC
Chairman's Statement and Strategic Report
Management Resource Solutions plc and Holdings (MRS) Pty Ltd
The combined Continuing Operations loss of MRS PLC and HMRS for
FY17 was $5.2m. However, this included $3.5m of net non-recurring
restructuring (bad debt write-offs, consultants, legal fees,
accounting fees, Deed Of Company Arrangement costs, AIM penalties
and the foreign exchange impacts of these), and tax effect
adjustments. Continuing operational costs for MRS PLC and HMRS for
FY17 totalled $1.6m.
Management Resource Solutions Pty Ltd, MRS Guernsey Ltd and MRS
PNG Limited.
Management Resource Solutions Pty Ltd, MRS Guernsey Ltd and MRS
PNG Ltd were placed into voluntary administration during FY17. A
number of provisions and impairments were included in the FY16
accounts, however, it was not until the completion of the FY17
accounts (and further review of the FY16 accounts) that the total
cost of the closure of these businesses has been realised.
Significant losses within the discontinued operations have been
offset by the gains on debt forgiveness by the other parts of the
group, resulting in an FY17 profit of $9.1m (FY16 loss $4.1m).
Bachmann Plant Hire
Bachmann Plant Hire Pty Ltd ("BPH") is based in Ipswich,
approximately 40km west of Brisbane, and specialises in bulk
earthworks for the civil construction industry. BPH provides plant
and solutions both with and without operators (known as 'wet' and
'dry' hire respectively).
The Ipswich Economic Development Plan 2016 to 2031, enacted by
the Queensland Government, is an ambitious plan to attract 292,000
people to 20 employment and population growth areas in the vicinity
of Ipswich, resulting in an additional 120,000 jobs. More than 500
new residential dwellings are required to be completed every month
to achieve the plan, resulting in the fastest growing residential
growth corridor in Australia.
BPH has a 50-year history and an experienced workforce of long
term employees, and is perfectly located to exploit these
opportunities. Most contracts are based on bulk earthworks within a
small, well defined area of a residential or commercial
sub-division to a final level finish of +/- 50mm. Although
operations can be hampered by excessive rainfall, overall BPH
operates in a relatively low risk contracting environment. Whilst
contracts are generally relatively short (2 to 6 months in length),
there is a steady pipeline of work to complete.
FY17 was the first full year contribution by BPH to the MRS
Group, with a Net Profit After Tax of $1.5m (FY16 loss $0.2m - 5
months) on Revenue of $22.2m (FY16 $10.9m - 5 months). During FY17
BPH operated at close to full utilisation of its Plant &
Equipment. There are no discontinued operational costs in the table
below.
Unaudited Half Year Results
BPH FY17 $'000s 1H17 2H17 FY17
-------------------------- -------- -------- ---------
Revenue 11,705 10,504 22,208
-------------------------- -------- -------- ---------
Cost of Sales (8,849) (8,684) (17,533)
-------------------------- -------- -------- ---------
GM 2,856 1,820 4,675
-------------------------- -------- -------- ---------
Operating costs (1,577) 1,989 413
-------------------------- -------- -------- ---------
EBITDA 1,279 3,809 5,088
-------------------------- -------- -------- ---------
Depreciation (1,164) (1,675) (2,839)
-------------------------- -------- -------- ---------
Operating profit/(loss) 115 2,134 2,249
-------------------------- -------- -------- ---------
Interest received/(paid) (0) (222) (222)
-------------------------- -------- -------- ---------
Net profit/(loss)
before tax 115 1,913 2,027
-------------------------- -------- -------- ---------
Tax (853) 329 (524)
-------------------------- -------- -------- ---------
Net profit/(loss)
after tax (738) 2,242 1,503
-------------------------- -------- -------- ---------
The Board has approved capital expenditure to provide access to
additional Plant & Equipment, to enable BPH to grow revenues
where they are expected to be earnings enhancing.
Management Resource Solutions PLC
Chairman's Statement and Strategic Report
MRS Services Group
MRS Services Group ("MRSSG") was created through the acquisition
of various assets from SubZero Group Limited on 30 September
2016.
MRSSG is strategically located in the heart of the coal mining
region of the Hunter Valley in New South Wales, approximately 125km
North West of the coal exporting port of Newcastle and about 240km
north of Sydney. Some 90% of revenues are derived from blue chip
miners including Yancoal, Rio Tinto, BHP and Glencore. Demand for
high quality coal (with high energy content with low ash and
pollutants) from the Hunter Valley remains strong and is expected
to grow, in particular for export to China and East Asia where over
1,000 new High Energy Low Emissions (HELE) Ultra-Supercritical Coal
Fired Power Stations coal fired power stations are planned or under
construction.
The majority of MRSSG's work in the Hunter Valley is low risk,
derived from selling trade labour at hourly rates. The fabrication
and mine rehabilitation businesses are based on longer-term
contracts in well-established work relationships and well
understood risk profiles.
Initially the business suffered from a lack of working capital,
an excessive cost base and a lack of commercial and financial
discipline, with the first 6 months of operating the MRSSG assets
proving particularly challenging. However, the quality of the work
provided by MRSSG, and strong demand for the services provided by
MRSSG, have enabled management to grow revenues. Furthermore, as
outlined in the interim results announcement on 7 April, an initial
programme of rationalisation, relocation and reductions in both
overheads and operating costs has been implemented, subsequently
returning the MRSSG business to profitability in May 2017.
FY17 was the first year of contribution for MRSSG, with a Net
Loss After Tax of A$7.4m on Revenue of A$30.1m in the 9 months to
30 June. This loss includes approximately $1.0m of one off costs
including relocation, finance, and redundancy.
Unaudited Half Year Results
MRSSG FY17 $'000s
(excluding
restructuring
costs) 1H17 2H17 FY17
-------------------------- -------- --------- ---------
Revenue 9,073 20,988 30,061
-------------------------- -------- --------- ---------
Cost of Sales (8,664) (14,740) (23,404)
-------------------------- -------- --------- ---------
GM 409 6,248 6,657
-------------------------- -------- --------- ---------
Operating costs (3,314) (8,455) (11,769)
-------------------------- -------- --------- ---------
EBITDA (2,906) (2,207) (5,112)
-------------------------- -------- --------- ---------
Depreciation (115) (453) (568)
-------------------------- -------- --------- ---------
Operating profit/(loss) (3,020) (2,660) (5,680)
-------------------------- -------- --------- ---------
Interest received/(paid) (64) (1,375) (1,439)
-------------------------- -------- --------- ---------
Net profit/(loss)
before tax (3,084) (4,035) (7,119)
-------------------------- -------- --------- ---------
Tax 0 (315) (315)
-------------------------- -------- --------- ---------
Net profit/(loss)
after tax (3,084) (4,350) (7,434)
-------------------------- -------- --------- ---------
MRSSG has contributed profit on a monthly basis since May 2017,
with performance continuing to improve as revenue growth continues
and further cost saving strategies are implemented.
Management Resource Solutions PLC
Chairman's Statement and Strategic Report
MRS Outlook
The markets which BPH and MRSSG service are the strongest they
have been in years. BPH is currently working at fully capacity and
has a strong pipeline of work to complete. MRSSG is experiencing
strong demand, with revenues now exceeding $4.0m per month.
The Hunter Valley thermal coal price has been strong and stable
providing confidence for the coal mines to commit to repairs and
maintenance and Yancoal has recently completed the acquisition of
the Rio Tinto assets in the Hunter Valley.
Both BPH and MRSSG were run as separate operations with little
interaction or utilisation of shared services and group purchasing
during the financial years 2015-16 ('FY16') and 2016-17 ('FY17').
During late FY17 and 2017-17 ('FY18') the new Board prioritised
significant cost cutting and restructuring, and has restructured
the senior management, which now includes Group Human Resources,
Group Asset Management, Group Procurement and Group Financial
Management. Further changes include the recent recruitment of a
General Manager - Civil and Earthworks, as part of succession
planning at BPH.
The cost cutting and restructuring programme is now
substantially complete. As the drive to grow revenues continues,
the Board is committed to focusing on earnings growth and
shareholder value for the remainder of FY18 and beyond.
For FY18, first half expectations are for Profit after Tax and
earnings per share to exceed $2.2m and 0.8p respectively, whilst
for the full year earnings per share of not less than 2.0p are in
prospect.
Further progress is anticipated in 2018-19 as debt continues to
be repaid from the strong operational cash-flow generated by the
major changes which are now taking effect.
On behalf of the Board, I'd like to thank all employees for
their continued commitment to working safely and to all
stakeholders of MRS including employees, customers, suppliers,
funders and shareholders for maintaining their support for the
Company.
John Zorbas
Chairman
Management Resource Solutions PLC
Directors' Report
for the year ended 30 June 2017
The Directors present their report and the audited financial
statements for the year ended 30 June 2017.
Principal activities
The principal activities of the Group during the year were plant
hire, equipment repair, refurbishment and fabrication, mine
rehabilitation, earthmoving, road construction and other support
services to a wide base of private and public-sector clients in
Australia. MRS caters predominately for the mining, civil,
engineering, construction and infrastructure industries.
Issue of Shares
Details of Ordinary Shares issued during the year are set out in
notes 24 to 26 of the Financial Statements.
Share based payments
Share based payments are detailed in note 26 to the Financial
Statements.
Results and dividends
The results for the year are set out on page 17.
The Directors do not recommend the payment of a dividend.
Business and financial review
All references to dollars or $ relate to Australian dollars, the
Group's presentational currency.
A review of the business and future developments is given in the
CEO's Statement and Strategic Report on page 2.
Revenue from continuing operations for the period amounted to
$52.4 million (2016 - $13.3 million).
Net loss after tax for the period amounted to $10.8 million
(2016 - loss of $4.6 million).
At 30 June 2017, the Group had net assets of $3.7 million (2016
- net liabilities of $2.8 million), of which cash amounted to $2.0
million (2016 - $0.9 million).
Going concern
The financial statements have been prepared on the going concern
basis as, in the opinion of the Directors, at the time of approving
the financial statements, there is a reasonable expectation that
the Group will continue in operational existence for the
foreseeable future.
In order to arrive at this opinion, the Directors have prepared
detailed cash flow forecasts for the Group, which demonstrate that
it will be able to meet its liabilities as they fall due for a
period of at least twelve months from the date of approval of the
financial statements.
Further information on the going concern assumption is provided
in note 1 to the consolidated financial statements.
Key performance indicators
The Group's current key performance indicators are safety,
building revenue and profitability, and expanding our diverse
client base. Relevant information is reported in the Chairman's
Statement.
Management Resource Solutions PLC
Directors' Report
for the year ended 30 June 2017
Principal risks and uncertainties
There are risks associated with the Group's business. The Board
regularly reviews the risks to which the Group is exposed and has
in place a strategy to mitigate these risks as far as possible. The
following summary, which is not exhaustive, outlines some of the
key risks and uncertainties facing the Group at its present stage
of development:
1 General risks
Reliance on key management
The responsibility of overseeing the day-to-day operations and
the strategic management of MRS depends substantially on its senior
management and its key personnel. There can be no assurance given
that there will be no detrimental impact on MRS if one or more of
these employees cease their employment.
2. Risks relating to MRS's Businesses
2.1 General
2.1.1 Operating risks
The Group's business planning is carried out on the basis of
expected future work. The Group is reliant upon securing new
contracts. There is a risk that expected contracts will not be won.
The directors mitigate this risk by monitoring the pipeline of
future contracts.
The operations of MRS may be affected by various factors,
including operational and technical difficulties encountered in
resources; difficulties in commissioning and operating plant and
equipment; mechanical failure or plant breakdown; adverse weather
conditions; industrial and environmental accidents; industrial
disputes; and unexpected shortages or increases in the costs of
consumables, spare parts, or plant and equipment.
2.1.2 Additional requirements for capital
MRS's capital requirements depend on numerous factors. To fully
realise its growth plans MRS may require further financing. Any
additional equity financing will dilute shareholdings. Any debt
financing, if available, may involve restrictions on financing and
operating activities
2.2 Specific
2.2.1 Personnel subject to workplace safety on client sites
The Company's personnel deliver services on site. Consequently,
personnel may be subjected to risks to their health and safety
through the actions, inactions and negligence of third parties.
Numerous losses may stem from injury or death to personnel in such
a scenario and such losses may have an adverse effect on MRS's
profits, its results, its balance sheet and its financial
position.
Refer to note 23 for Financial risk.
Management Resource Solutions PLC
Directors' Report
for the year ended 30 June 2017
The Directors regularly monitor such risks and will take actions
as appropriate to mitigate them. The Group manages its risks by
seeking to ensure it is in compliance with the terms of its
agreements, and through the application of appropriate policies and
procedures, and via the recruitment and retention of a team of
skilled and experienced professionals.
Directors
The Directors of the Company during the period and the
remuneration, including pension contributions, they received were
as follows:
Remuneration
2017 2016
$ $
Paul Morffew (removed
28 October 2016) 311,161 481,357
Murray D'Almeida (resigned
17 March 2017) 246,629 135,171
Chris Berkefeld (resigned
10 April 2017) 103,739 40,343
Timothy Jones 84,173 97,847
Joe Clayton (appointed 769,335 -
19 December 2016)
John Zorbas (appointed 32,100 -
10 April 2017)
Trevor Brown (appointed 32,990 -
10 April 2017)
Nigel Burton (appointed 139,683 -
10 April 2017)
Joe Clayton resigned as a Director on 21 August 2017.
Directors' Interests, including family interests, in Ordinary
Shares of the Company and in options and warrants to subscribe for
Ordinary Shares were as follows (see note 24 for details of share
based payment arrangements):
2017 2016
Ordinary Shares
Paul Morffew - 15,170,296
Murray D'Almeida - -
Chris Berkefeld - -
Timothy Jones 480,473 133,333
Joe Clayton - -
John Zorbas - -
Trevor Brown 6,000,000 -
Nigel Burton 4,000,000 -
2017 2016
Options
Paul Morffew - 1,640,834
Murray D'Almeida - 492,250
Chris Berkefeld - -
Timothy Jones 492,250 492,250
Joe Clayton - -
John Zorbas - -
Trevor Brown - -
Nigel Burton - -
Management Resource Solutions PLC
Directors' Report
for the year ended 30 June 2017
2017 2016
Warrants (exercisable
at 30 p)
Paul Morffew - -
Murray D'Almeida - -
Chris Berkefeld - -
Timothy Jones 133,333 133,333
Joe Clayton - -
John Zorbas - -
Trevor Brown - -
Nigel Burton - -
Warrants (exercisable
at 5 p)
Paul Morffew - -
Murray D'Almeida - -
Chris Berkefeld - -
Timothy Jones 360,000 -
Joe Clayton 2,500,000 -
John Zorbas 4,700,000 -
Trevor Brown 2,000,000 -
Nigel Burton 2,000,000 -
Substantial Shareholdings
At 20 December 2017, the Company was aware of the following
interests in 3% or more of the issued share capital of the
Company:
%
Karrabin Investments Pty Ltd 9.9
Leon Hogan 9.8
URU Metals Limited 9.8
Trevor Brown 5.4
Paul and Santina Morffew (including SCOPN Pty Ltd) 4.2
Macquarie Bank Limited 3.8
Daniel Smith 3.4
Management Resource Solutions PLC
Directors' Report
for the year ended 30 June 2017
Financial instruments
Details regarding the Group's use of financial instruments and
their associated risks are given in note 23 to the consolidated
financial statements.
Indemnity Provision for Directors
MRS has insurances to cover Directors' and Officers' liabilities
for an amount of GBP10,000,000 which the Directors believe to be
sufficient for the business.
Statement as to disclosure of information to auditors
All the current Directors have taken all the steps that they
ought to have taken to make themselves aware of any information
needed by the Company's Auditors for the purposes of their audit
and to establish that the Auditors are aware of that information.
The Directors are not aware of any relevant audit information of
which the Auditors are unaware.
Subsequent events
Refer to note 31 of the consolidated financial statements.
Auditors
James Cowper Kreston have expressed their willingness to
continue in office and a resolution to re--appoint them will be
proposed at the Annual General Meeting which will be held at 09:30
on 26 January 2018 at the offices of Memery Crystal, 44 Southampton
Buildings, London, WC2A 1AP.
Approved by the board of Directors on 20 December 2017 and
signed on behalf of the board by
John Zorbas
Chairman
Management Resource Solutions PLC
Statement of Directors' Responsibilities for the year ended 30
June 2017
The Directors are responsible for preparing the strategic
report, the directors' 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 elected to prepare the Group financial statements in
accordance with International Financial Reporting Standards (IFRSs)
as adopted by the European Union and to prepare the parent company
accounts in accordance with UK accounting standards including FRS
101 "Reduced Disclosure Framework". 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 and
Company for that period. The Directors are also required to prepare
financial statements in accordance with the rules of the London
Stock Exchange for companies trading securities on the Alternative
Investment Market.
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;
-- state whether the group accounts have been prepared in
accordance with IFRSs as adopted by the European Union, subject to
any material departures disclosed and explained in the financial
statements;
-- state whether the parent company accounts have been prepared
in accordance with applicable UK accounting standards, subject to
any material departures disclosed and explained in the financial
statements.
-- 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
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 requirements
of the Companies Act 2006. They are also responsible for
safeguarding the assets of the Company and hence for taking
reasonable steps for the prevention and detection of fraud and
other irregularities.
Website publication
The Directors are responsible for ensuring the annual report and
the financial statements are made available on a website. Financial
statements are published on the Company's website www.mrsplc.info
in accordance with legislation in the United Kingdom governing the
preparation and dissemination of financial statements, which may
vary from legislation in other jurisdictions. The maintenance and
integrity of the Company's website is the responsibility of the
Directors. The Directors' responsibility also extends to the
ongoing integrity of the financial statements contained
therein.
Management Resource Solutions PLC
Independent auditor's report
to the members of Management Resource Solutions PLC
Independent auditor's report to the members of Management
Resource Solutions plc
Opinion
We have audited the financial statements of Management Resource
Solutions plc (the 'company') for the year ended 30 June 2017 which
comprise the consolidated statement of comprehensive income, the
consolidated and parent company balance sheets, the consolidated
cash flow statement, the consolidated and parent company statements
of changes in equity and the related notes, including a summary of
significant accounting policies.
The financial reporting framework that has been applied in the
preparation of the consolidated financial statements is applicable
law and International Financial Reporting Standards as adopted by
the European Union. The financial reporting framework applied in
the preparation of the parent company financial statements is
applicable law and United Kingdom Accounting Standards, including
Financial Reporting Standard 101 "Reduced Disclosure Framework"
(United Kingdom Generally Accepted Accounting Practice).
In our opinion, the financial statements:
-- give a true and fair view of the state of the group and
parent company's affairs as at 30 June 2017 and of the group's loss
for the year then ended;
-- have been properly prepared in accordance with the financial
reporting frameworks as outlined above; 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 of Auditing (UK) (ISAs (UK)) and applicable law. Our
responsibilities under those standards are further discussed in the
Auditor's responsibilities for the audit of the financial
statements section of our report. We are independent of the company
in accordance with the ethical requirements that are relevant to
our audit of the financial statements in the UK, including the
FRC's Ethical Standards as applied to listed entities, and we have
fulfilled our 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.
Effect of audit opinion in previous year
We were unable to express an audit opinion on the previous
year's financial statements as it was not possible for us to obtain
sufficient appropriate audit evidence over multiple material
elements of those financial statements, details of which were
outlined in our audit report on those previous year's financial
statements. Our audit report on the previous year's financial
statements also included a disagreement regarding the accounting
treatment of a provision for future maintenance costs.
Management have corrected the accounting treatment referred to
above and we have, retrospectively, been able to perform
appropriate procedures to eliminate the impact of the previous
year's disclaimer of opinion on our opinion on the current year's
financial statements.
We do not give any opinion on the previous year's financial
statements.
Management Resource Solutions PLC
Independent auditor's report
to the members of Management Resource Solutions PLC
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
were:
-- 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 company'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.
An overview of the scope of our audit
Our audit was scoped by obtaining an understanding of the group
and its environment, assessing the risks of material misstatement
in the financial statements and planning and performing appropriate
audit procedures in response to those risks.
All of the group's operations, management and accounting
function resides in Australia. Accordingly, the majority of the
audit work was undertaken by a local firm of auditors. We directed,
supervised and reviewed their work appropriately to enable us to
form an opinion on the financial statements.
Key audit matters
Key audit matters are those matters that, in our professional
judgement, were of most significance in our audit of the financial
statements of the current period and include the most significant
assessed risks of material misstatement (whether or not due to
fraud) we identified, including those which had the greatest effect
on: the overall audit strategy; the allocation of resources in the
audit; and directing efforts of the engagement team. These matters
were addressed in the context of our audit of the financial
statements as a whole, and in forming our opinion thereon, and we
do not provide a separate opinion on these matters.
Revenue recognition
Risk description
There is an inherent risk of misstatement of revenue in most
trading businesses, whether amounting from fraud or error.
How the scope of our audit responded to the risk
To assess the appropriateness and completeness of revenue
recognised in the year the following procedures were performed:
-- examined a sample of revenue transactions by reference to underlying contractual terms;
-- examined a sample of items of accrued revenue on incomplete
projects by reference to contractual terms, stage of completeness
and subsequent invoices
-- considered the appropriateness and application of the
company's accounting policy for revenue recognition; and
-- considered the disclosures in the financial statements regarding revenue.
Key observations
The results of our testing were satisfactory and we consider the
disclosure surrounding revenue to be appropriate.
Management Resource Solutions PLC
Independent auditor's report
to the members of Management Resource Solutions PLC
Risks arising from qualifications to prior year audit report
Risk description
We were unable to express an audit opinion on the previous
year's financial statements as it was not possible for us to obtain
sufficient appropriate audit evidence over multiple material
elements of those financial statements. This cast doubt over the
opening balance sheet and, accordingly, over the current year
income statement.
How the scope of our audit responded to the risk
Additional audit procedures were undertaken this year to
address, retrospectively, those matters that gave rise to the
qualification of the prior year audit report, so far as they were
relevant to the current year's financial statements.
Key observations
The results of our testing were satisfactory.
Acquisition accounting
Risk description
The group undertook a material acquisition in the year. The
accounting for acquisitions is potentially complex and can involve
significant judgements and/or management estimates.
How the scope of our audit responded to the risk
We reviewed the acquisition accounting by reference to the
contractual arrangements and considered in detail whether the
accounting was in accordance with International Financial Reporting
Standards including, inter alia, the relevant requirements to
account for the consideration and net assets acquired at fair
value.
Key observations
The results of our testing were satisfactory.
Risks related to the liquidation of subsidiaries
Risk description
The group liquidated three of its subsidiaries during the year
giving rise to a material gain on disposal and the need for
extensive disclosures regarding discontinued activities.
How the scope of our audit responded to the risk
We reviewed the accounting for the disposal (loss of control) of
the liquidated entities in detail including reviewing the balance
sheets of the liquidated entities as at the date they exited the
group. We considered whether the group was exposed to any material
liabilities resulting from the liquidation events and further
reviewed and considered the adequacy of the disclosures in respect
of discontinued operations.
Key observations
The results of our testing were satisfactory.
Property, plant and equipment
Risk description
The group holds a material amount of property plant and
equipment (PPE) which are held in various physical locations. There
are various risks associated including existence, valuation and
impairment risk.
How the scope of our audit responded to the risk
Testing was performed on a sample basis to obtain assurance that
assets existed and were recorded at an appropriate value.
Management's impairment reviews and the conclusions drawn therefrom
were reviewed and considered in detail.
Key observations
The results of our testing were satisfactory.
Management Resource Solutions PLC
Independent auditor's report
to the members of Management Resource Solutions PLC
Our application of materiality
We define materiality as the magnitude of misstatement in the
financial statements that makes it probable that the economic
decisions of a reasonably knowledgeable person would be changed or
influenced. We use materiality both in planning the scope of our
audit work and in evaluating the results of our work.
Based on our professional judgement we determined materiality
for the financial statements as a whole to be $800,000 (2016:
$300,000), based primarily on the loss from continuing
operations.
We agreed with the directors that we would report all audit
differences in excess of $25,000 (2016: $15,000) as well as
differences below that threshold that, in our view, warranted
reporting on qualitative grounds. We also report on disclosure
matters that we identified when assessing the overall presentation
of the financial statements.
Other information included in the annual report
The directors are responsible for the other information which
comprises the information included in the annual report, other than
the financial statements and our auditor's report thereon. Our
opinion on the financial statements does not cover the other
information and, except to the extent otherwise explicitly stated
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 of 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 in 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 strategic report and the
directors' report for the financial year for which the financial
statements are prepared is consistent with the financial
statements; and
-- the strategic report and the directors' report 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 company
and its environment obtained in the course of the audit, we have
not identified material misstatements in the strategic report or
the directors' report.
We have nothing to report in respect of the following matters in
relation to the financial statements which the Companies Act 2006
requires us to report to you if, in our opinion:
-- adequate accounting records have not been kept, or returns
adequate for the audit have not been received from branches not
visited by us; or
-- the 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.
Management Resource Solutions PLC
Independent auditor's report
to the members of Management Resource Solutions PLC
Responsibilities of directors
As explained more fully in the directors' responsibilities
statement set out on page 11, 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 is 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 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 company or to cease
operating, or have no realistic alternative but to do so.
Auditors' responsibilities for the audit of the financial
statements
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
an Auditors' report 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.
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 an
auditor's report 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
statement.
A further description of our responsibilities for the audit of
the financial statements is located on the Financial Reporting
Council's website at: frc.org.uk. This description forms part of
our auditors' report.
Alan Poole BA (Hons) FCA (Senior Statutory Auditor)
For and on behalf of
James Cowper Kreston
Statutory Auditors
Reading
Date: 20 December 2017
Management Resource Solutions PLC
Consolidated Statement of profit and loss and other
comprehensive income
for the year ended 30 June 2017
Note 2017 As restated
2016
$'000 $'000
Continuing Operations
Revenue 3 52,363 13,316
Cost of sales (39,553) (10,066)
---------- ------------
Gross profit 12,810 3,250
Recurring administrative
expenses (20,310) (2,986)
---------- ------------
(Loss)/Profit before
non-recurring costs
and finance charges (7,500) 264
Non-recurring administrative
expenses:
Acquisition expenses 5 (972) (261)
Share based payment
charges 5 (241) -
Gain on acquisition
of subsidiary - 2,152
---------- ------------
Operating loss 6 (8,713) 2,155
Finance costs - interest 10 (1,901) (101)
(Loss)/Profit before
tax (10,614) 2,054
Tax (expense)/credit 11 (492) (445)
(Loss)/Profit from
continuing operations
attributable to equity
holders of the parent
company (11,106) 1,609
Profit/(Loss) from
discontinued operations 16 321 (6,209)
---------- ------------
(Loss)/Profit for
the year attributable
to equity holders
of the parent company (10,785) (4,600)
========== ============
Earnings per share 13
Continuing Operations
Basic and diluted (12.99)c 4.85c
Discontinued Operations
Basic and diluted 0.38c (18.72)c
Total
Basic and diluted (12.61)c (13.87)c
There was no other comprehensive income for the year
(2016-nil).
Management Resource Solutions PLC
Consolidated Balance Sheet
at 30 June 2017
2017 As restated
2016
Note $'000 $'000
Assets
Non-current assets
Property, plant and equipment 14 17,574 13,404
17,574 13,404
Current assets
Trade and other receivables 18 17,536 6,123
Cash and cash equivalents 2,029 894
Tax 141 23
Inventories 19 590 234
20,296 7,274
Total assets 37,870 20,678
======= ============
Liabilities
Current liabilities
Trade and other payables 20 14,677 10,595
Borrowings 22 11,127 3,664
25,804 14,259
Non-current liabilities
Borrowings 22 7,971 6,395
Provision 19 373 190
Other non-current liabilities - 2,666
8,344 9,251
Total liabilities 34,148 23,510
Net assets/(liabilities) 3,722 (2,832)
Equity attributable to
equity holders of the parent
Share capital 24 38,711 36,677
Share premium 27 16,808 1,744
Issue costs reserve 27 (332) (332)
Reorganisation reserve 27 (36,032) (36,032)
Retained earnings 27 (15,433) (4,889)
Total equity attributable
to equity holders of the
parent 3,722 (2,832)
--------- ---------
The financial statements were approved by the board of Directors
and authorised for issue on 20 December 2017 and were signed on its
behalf by:
John Zorbas Timothy Jones
Director Director
Management Resource Solutions PLC
Consolidated Statement of Changes in Equity
for the year ended 30 June 2017
Share Share Issue Reorganisation Retained Total
Capital Premium costs reserve earnings equity
reserve
$'000 $'000 $'000 $'000 $'000 $'000
At 1 July
2015 36,623 1,221 (332) (36,032) (289) 1,191
Loss for
the Year
(restated) - - - - (4,600) (4,600)
---------- ----------
Total comprehensive
income - - - - (4,600) (4,600)
---------- ---------- ---------- ----------------- ----------- ---------
Other Movements
Issue of
Shares 54 523 - - - 577
Dividends - - - - - -
Expenses
of issue - - - - - -
---------- ---------- ---------- ----------------- ----------- ---------
Total other
movements 54 523 - - - 577
---------- ---------- ---------- ----------------- ----------- ---------
At 30 June
2016
(restated) 36,677 1,744 (332) (36,032) (4,889) (2,832)
========== ========== ========== ================= =========== =========
At 1 July
2016 (as
previously
restated) 36,677 1,744 (332) (36,032) (7,213) (5,156)
Prior Year
Adjustment - - - - 2,324 2,324
At 1 July
2016 (as
restated) 36,677 1,744 (332) (36,032) (4,889) (2,832)
Loss for
the Year - - - - (10,785) (10,785)
---------- ---------- ---------- ----------------- ----------- ---------
Total comprehensive
income - - - - (10,785) (10,785)
---------- ---------- ---------- ----------------- ----------- ---------
Other Movements
Issue of
Shares 2,034 15,972 - - - 18,006
Share based
payments
charge - - - - 241 241
Expenses
of issue - (908) - - - (908)
---------- ---------- ---------- ----------------- ----------- ---------
Total other
movements 2,034 15,064 - - 241 17,339
---------- ---------- ---------- ----------------- ----------- ---------
At 30 June
2017 38,711 16,808 (332) (36,032) (15,433) 3,722
========== ========== ========== ================= =========== =========
Management Resource Solutions PLC
Consolidated Statement of Cashflow
for the year ended 30 June 2017
2017 As restated
2016
$'000 $'000
Cash flow from operating
activities
Receipts from customers 54,967 21,653
Payments to suppliers and
employees (71,940) (20,924)
Interest received - 8
Finance costs (1,945) (256)
Tax paid (610) (322)
Net cash flow from operating
activities (19,528) 159
Cash flow from investing
activities
Purchase of SubZero non-current
assets (4,200) -
Net (purchase)/disposal
of non-current assets 207 (37)
Acquisition of subsidiary
BPH, net of cash acquired - (10,675)
Net cash flow from investing
activities (3,993) (10,712)
Cash flow from financing
activities
Net proceeds from borrowings 3,684 7,508
Proceeds from debtor finance 3,633 2,442
Proceeds from issue of
shares net of costs 17,339 577
Net cash flow from financing
activities 24,656 10,527
Net increase/(decrease)
in cash held 1,135 (26)
Cash and cash equivalents
at 1 July 2016 894 920
Cash and cash equivalents
at 30 June 2017 2,029 894
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017
1 Accounting policies
Basis of preparation
The principal accounting policies adopted in the preparation of
the financial statements are set out below. The policies have been
consistently applied to the periods presented, unless otherwise
stated.
These financial statements have been prepared on the historical
cost basis, on the basis of going concern and in line with
International Financial Reporting Standards (IFRS) and IFRIC
interpretations issued by the International Accounting Standards
Board (IASB) adopted by the European Union and in accordance with
applicable UK law.
The preparation of financial statements in conformity with IFRS
requires management to make judgements, estimates and assumptions
that affect the application of policies and reported amounts of
assets and liabilities, income and expenses. The estimates and
associated assumptions are based on historical experience and
factors that are believed to be reasonable under the circumstances,
the results of which form the basis of making judgements about
carrying values of assets and liabilities that are not readily
apparent from other sources. Actual results may differ from these
estimates.
The estimates and underlying assumptions are reviewed on an
ongoing basis. See note 2 for more details.
Going concern
The financial statements have been prepared on the going concern
basis as, in the opinion of the Directors, at the time of approving
the financial statements, there is a reasonable expectation that
the Group will continue in operational existence for the
foreseeable future.
Closure of the former consulting business has brought major cost
savings and the market environment in the Hunter Valley coal mining
sector has resulted in a significant increase in demand for the
Group's services. Based on these developments and on the Group's
ability to modify expenditure outlays further if required, and to
source additional funds, the Directors consider there are
reasonable grounds to believe that the Group will be able to pay
its debts as and when they become due and payable, and therefore
the going concern basis of preparation is considered to be
appropriate for the financial report for the year ended 30 June
2017 (as indicated in the Chairman's Report) .
The Group enjoys a strong relationship with its banker, and the
Directors believe they would be able to undertake a combination of
the following courses of action should additional funding be
required:
- continue the close relationship with the bank and restructure existing financial obligations
- negotiate alternate financing arrangements
- access additional equity funding
The Directors believe that the Group will be successful in
managing the above matters and accordingly, they have prepared the
financial report on a going concern basis.
Basis of consolidation
Where the Group has control over an investee, it is classified
as a subsidiary. The Group controls an investee if all three of the
following elements are present: power over an investee, exposure to
variable returns from the investee, and the ability of the investor
to use its power of affect those variable returns. Control is
reassessed whenever facts and circumstances indicate that there may
be a change in any of these elements of control. Subsidiaries are
fully consolidated from the date that control commences until the
date that control ceases. The consolidated financial statements
present the results of the Company and its subsidiaries ("the
Group") as if they formed a single entity. Intercompany
transactions and balances between Group companies are therefore
eliminated in full.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
1 Accounting policies (continued)
Business combinations
The consolidated financial statements incorporate the results of
business combinations using the purchase method. In the
consolidated balance sheet, the acquiree's identifiable assets,
liabilities and contingent liabilities are initially recognised at
their fair value at the acquisition date. The results of acquired
operations are included in the consolidated income statement from
the date on which control is obtained.
The Company was incorporated on 26 April 2012 for the purpose of
acquiring the entire issued share capital of Management Resource
Solutions Pty Ltd, which was previously the ultimate parent company
of the Group. This acquisition took place on 24 August 2012 by the
issue of the entire ordinary share capital of the Company to the
shareholders of Management Resource Solutions Pty Ltd in exchange
for their shareholdings in the Company.
This reconstruction is accounted for as an acquisition under
common control. Accordingly, the financial statements present the
Group results as a continuation of the results of the Group
previously headed by Management Resource Solutions Pty Ltd.
Corporate Income Tax
The income tax expense (income) for the year comprises current
income tax expense (income) and deferred tax expense (income).
Current income tax expense charged to the profit or loss is the
tax payable on taxable income. Current tax liabilities (assets) are
measured at the amounts expected to be paid to (recovered from) the
relevant taxation authority.
Deferred income tax expense reflects movements in deferred tax
asset and deferred tax liability balances during the year as well
as unused tax losses.
Current and deferred income tax expense (income) is charged or
credited outside the profit and loss when the tax relates to items
that are recognised outside the profit and loss.
Except for business combinations, no deferred income tax is
recognised from the initial recognition of an asset or liability
where there is no effect on accounting or taxable profit or
loss.
Deferred tax assets and liabilities are calculated at the tax
rates that are expected to apply to the period when the asset is
realised or the liability is settled and their measurement also
reflects the manner in which management expects to recover or
settle the carrying amount of the related asset or liability. With
respect to non-depreciable items of property, plant and equipment
measured at fair value and items of investment property measured at
fair value, the related deferred tax liability or deferred tax
asset is measured on the basis that the carrying amount of the
asset will be recovered entirely through sale. When an investment
property that is depreciable is held by the Company in a business
model whose objective is to consume substantially all of the
economic benefits embodies in the property through use over time
(rather than through sale), the related deferred tax liability or
deferred tax asset is measured on the basis that the carrying
amount of such property will be recovered entirely through use.
Deferred tax assets relating to temporary differences and unused
tax losses are recognised only to the extent that it is probable
that future taxable profit will be available against which the
benefits of the deferred tax asset can be utilised.
Discontinued operations
Discontinued operations represent cash generating units that
have been placed into voluntary administration and ceased
operating. The post-tax profit or loss of the discontinued
operation is presented as a single line
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
1 Accounting policies (continued)
on the face of the consolidated income statement. The
presentation of discontinued operations within prior periods is
restated to reflect consistent classification of discontinued
operations across all periods presented.
Prior period adjustments
The completion of the 30 June 2017 audit identified a number of
errors in the disclaimed 30 June 2016 annual report. Refer to Note
32 for details for these corrections
Operating segments
IFRS 8 "Operating Segments" requires the disclosure of segmental
information for the Group on the basis of information reported
internally to the chief operating decision-maker for
decision-making purposes. The Group considers that the role of
chief operating decision-maker is performed collectively by the
Board of Directors.
Management Resource Solutions plc is a holding company that
operates two businesses in Australia, Plant Hire and Mining
Contracting. Its customers are based in Australia.
Financial information (including revenue and profit before tax
and intra-group charges) is reported to the board on a segmental
basis. Segment revenue comprises sales to external customers and
excludes gains arising on the disposal of assets and finance
income. Segment profit reported to the board represents the profit
earned by each segment before tax and intra-group charges. For the
purposes of assessing segment performance and for determining the
allocation of resources between segments, the board reviews the
noncurrent assets attributable to each segment as well as the
financial resources available. All assets are allocated to
reportable segments. Assets that are used jointly by segments are
allocated to the individual segments on a basis of revenues
earned.
All liabilities are allocated to individual segments.
Information is reported to the board of directors on a segmental
basis as management believes that each segment exposes the Group to
differing levels of risk and rewards due to their varying business
life cycles. The segment profit or loss, segment assets and segment
liabilities are measured on the same basis as amounts recognised in
the financial statements. Each segment is managed separately.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
1 Accounting policies (continued)
Where temporary differences exist in relation to investments in
subsidiaries, branches, associates, and joint ventures, deferred
tax assets and liabilities are not recognised where the timing of
the reversal of the temporary difference can be controlled and it
is not probable that the reversal will occur in the foreseeable
future.
Current tax assets and liabilities are offset where a legally
enforceable right of set-off exists and it is intended that net
settlement or simultaneous realisation and settlement of the
respective asset and liability will occur. Deferred tax assets and
liabilities are offset where: (a) a legally enforceable right of
set-off exists; and (b) the deferred tax assets and liabilities
relate to income taxes levied by the same taxation authority on
either the same taxable entity or different taxable entities, where
it is intended that net settlement or simultaneous realisation and
settlement of the respective asset and liability will occur in
future periods in which significant amounts of deferred tax assets
or liabilities are expected to be recovered or settled.
Property, Plant and Equipment
Property, plant and equipment are measured on the cost basis and
are therefore carried at cost less accumulated depreciation and any
accumulated impairment losses. In the event the carrying amount of
plant and equipment is greater than its estimated recoverable
amount, the carrying amount is written down immediately to its
estimated recoverable amount and impairment losses recognised
either in profit or loss or as a revaluation decrease if the
impairment losses relate to a revalued asset.
Goodwill
Goodwill arising on the acquisition of a subsidiary represents
the excess of the fair value of the consideration given over the
fair value of the identifiable net assets acquired. Goodwill is
initially recognised as an asset at cost and is subsequently
measured at cost less any accumulated impairment losses. Goodwill
impairment reviews are undertaken annually, or more frequently if
events or changes in circumstances indicate potential impairment.
The carrying value of goodwill is compared with the recoverable
amount, which is the higher of the value in use and the fair value
less costs to sell. Any impairment is recognised immediately as an
expense, separately disclosed in the intangible fixed asset note to
the financial statements, and is not subsequently reversed.
Where the fair value of the identifiable net assets acquired
exceeds the fair value of the consideration given, the excess is
recognised as a gain in the Consolidated Statement of Profit &
Loss.
Depreciation
The depreciable amount of all fixed assets including buildings
and capitalised lease assets is depreciated on a straight-line
basis over the asset's useful life to the consolidated group
commencing from the time the asset is held ready for use. Leasehold
improvements are depreciated over the shorter of either the
unexpired period of the lease or the estimated useful lives of the
improvements.
The depreciation rates used for each class of depreciable assets
are:
Class of Fixed Asset Depreciation Rate
--------------------------- --------------------
Leasehold improvements 5% straight line
--------------------------- --------------------
Plant and equipment 15 - 37.5% reducing
for hire balance
--------------------------- --------------------
Leased plant and equipment 40% straight line
--------------------------- --------------------
Office equipment 15 - 37.5% straight
line
--------------------------- --------------------
The assets' residual values and useful lives are reviewed, and
adjusted if appropriate, at the end of each reporting period. An
asset's carrying amount is written down immediately to its
recoverable amount if the asset's carrying amount is greater than
its estimated recoverable amount.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
1 Accounting policies (continued)
Gains and losses on disposals are determined by comparing
proceeds with the carrying amount. These gains or
losses are included in the statement of comprehensive
income. When revalued assets are sold, amounts included
in the revaluation surplus relating to that asset
are transferred to retained earnings.
Leases
Leases of fixed assets, where substantially all the
risks and benefits incidental to the ownership of
the asset - but not the legal ownership - are transferred
to entities in the consolidated group, are classified
as finance leases.
Finance leases are capitalised by recording an asset
and a liability at the lower of the amounts equal
to the fair value of the leased property or the present
value of the minimum lease payments, including any
guaranteed residual values. Lease payments are allocated
between the reduction of the lease liability and
the lease interest expense for the period.
Leased assets are depreciated on a straight-line
basis over the shorter of their estimated useful
lives or the lease term.
Lease payments for operating leases, where substantially
all the risks and benefits remain with the lessor,
are recognised as expenses on a straight-line basis
over the lease term.
Lease incentives under operating leases are recognised
as a liability and amortised on a straight-line basis
over the life of the lease term.
Financial Instruments
Initial recognition and measurement
Financial assets and financial liabilities are recognised
when the company becomes a party to the contractual
provisions of the instrument. For financial assets
this is equivalent to the date that the company commits
itself to either purchase or sell the asset (i.e.
trade date accounting is adopted). Financial instruments
are initially measured at fair value plus transaction
costs, except where the instrument is classified
'at fair value through profit or loss' in which case
transaction costs are expensed to profit or loss
immediately.
Impairment
At the end of each reporting period, the Group assesses
whether there is objective evidence that a financial
asset has been impaired. Impairment losses are recognised
in profit or loss immediately.
Impairment of non-financial assets
At the end of each reporting period, the Group assesses
whether there is any indication that an asset may
be impaired. The assessment will include considering
external sources of information and internal sources
of information. If such an indication exists, an
impairment test is carried out on the asset by comparing
the recoverable amount of the asset, being the higher
of the asset's fair value less costs to sell and
value in use to the asset's carrying amount. Any
excess of the asset's carrying amount over its recoverable
amount is recognised immediately in profit or loss
Foreign Currency Transactions and Balances
Functional and presentation currency
The functional currency of each group entity is measured
using the currency of the primary economic environment
in which that entity operates. The consolidated financial
statements are presented in Australian dollars which
is the functional currency for most of the group,
and the presentational currency.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
1 Accounting policies (continued)
Transactions and balances
Foreign currency transactions are translated into
functional currency using the exchange rates prevailing
at the date of the transaction. Foreign currency
monetary items are translated at the year-end exchange
rate. Non-monetary items are translated at the year
- end exchange rate. Non-monetary items measured
at historical cost continue to be carried at the
exchange rate at the date of the transaction. Non-monetary
items measured at fair value are reported at the
exchange rate at the date when fair values were determined.
Exchange differences arising on the translation of
monetary items are recognised in profit or loss,
except where deferred in equity as a qualifying cash
flow or net investment hedge.
Exchange differences arising on the translation of
non-monetary items are recognised directly in other
comprehensive income to the extent that the underlying
gain or loss is directly recognised in other comprehensive
income; otherwise the exchange difference is recognised
in profit or loss.
Employee Benefits
An accrual is made for the Group's liability for
employee benefits in relation to the Group's unpaid
contribution to defined contribution benefit schemes.
The Group's obligations in respect of defined contribution
pension schemes are recognised as a cost in the income
statement.
Provisions
Provisions are recognised when the Group has a legal
or constructive obligation, as a result of past events,
for which it is probable that an outflow of economic
benefits will result and that outflow can be reliably
measured.
Provisions are measured using the best estimate of
the amounts required to settle the obligation at
the end of the reporting period.
Cash and Cash Equivalents
Cash and cash equivalents include cash on hand, deposits
held at call with banks, other short-term highly
liquid investments with original maturities of three
months or less, and bank overdrafts. Bank overdrafts
are shown within short-term borrowings in current
liabilities on the statement of financial position.
Revenue and Other Income
Revenue recognition relating to the provision of
services is determined with reference to the stage
of completion of the transaction at the end of the
reporting period and where outcome of the contract
can be estimated reliably. Stage of completion is
determined with reference to the services performed
to date as a percentage of total anticipated services
to be performed, based on surveys of work performed.
Where the outcome cannot be estimated reliably, revenue
is recognised only to the extent that related expenditure
is recoverable.
All revenue is stated net of VAT and similar taxes.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
1 Accounting policies (continued)
Trade and other receivables
Trade and other receivables include amounts due from
customers for goods sold and services performed in
the ordinary course of business. Receivables expected
to be collected within 12 months of the end of the
reporting period are classified as current assets.
All other receivables are classified as non-current
assets.
Trade and other receivables are initially recognised
at fair value and subsequently measured at amortised
cost using the effective interest method, less any
provision for impairment. Refer to Note 1 for further
discussion on the determination of impairment losses.
Inventories
Raw materials, stores, and work in progress are stated
at the lower of cost and net realisable value. Cost
comprises direct materials, and direct labour. Costs
are assigned to individual items of inventory on
the basis of weighted average costs. Net realisable
value is the estimated selling price in the ordinary
course of business less the estimated costs of completion
and the estimated costs necessary to make the sale.
Trade and Other Payables
Trade and other payables represent the liabilities
for goods and services received by the Group that
remain unpaid at the end of the reporting period.
Borrowing Costs
Borrowing costs are recognised in the statement of
consolidated income for the period in which they
are incurred.
Goods and Services Tax (GST), Value Added Tax (VAT)
and equivalent taxes
Revenues, expenses and assets are recognised net
of the amount of GST and VAT, except where the amount
of GST or VAT incurred is not recoverable GST or
VAT.
Rounding
Amounts in the financial statements have been rounded
off in accordance with the instrument to the nearest
thousand dollars, or in certain cases, the nearest
dollar.
Recent accounting developments, new standards, amendments
and Interpretations
(a) Standards, amendments and interpretations effective
in 2017 and applied by the Group:
The Company has adopted the following revisions and
amendments to IFRS issued by the International Accounting
Standards Board, which are relevant to and effective
for the Company's financial statements for the period
beginning 1 July 2016.
* IFRS 2 Share--based Payment -- Definitions of vesting
conditions
* IFRS 3 Business Combinations -- Accounting for
contingent consideration in a business combination
* IFRS 5 Non--current Assets Held for Sale and
Discontinued Operations -- Changes in methods of
disposal
* IFRS 7 Financial Instruments: Disclosures --
Servicing contracts
* IFRS 7 Financial Instruments: Disclosures --
Applicability of the offsetting disclosures to
condensed interim financial statements
* IFRS 8 Operating Segments -- Aggregation of operating
segments
* IFRS 8 Operating Segments -- Reconciliation of the
total of the reportable segments' assets to the
entity's assets
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
1 Accounting policies (continued)
(a) Standards, amendments and interpretations effective
in 2017 and applied by the Group: (continued)
* IFRS 10 and IAS 28 Sale or Contribution of Assets
between an Investor and its Associate or Joint
Venture -- Amendments to IFRS 10 and IAS 28
* IFRS 10 and IAS 28 Sale or Contribution of Assets
between an Investor and its Associate or Joint
Venture -- Amendments to IFRS 10 and IAS 28 IFRS 10,
IFRS 12 and IAS 28 Investment Entities: Applying the
Consolidation Exception -- Amendments to IFRS 10,
IFRS 12 and IAS 28
* IFRS 11 Accounting for Acquisitions of Interests in
Joint Operations -- Amendments to IFRS 11
* IFRS 14 Regulatory Deferral Accounts
* IAS 1 Disclosure Initiative -- Amendments to IAS 1
* IAS 16 and IAS 38 -- Clarification of Acceptable
Methods of Depreciation and Amortisation --
Amendments to IAS 16 and IAS 38
* IAS 16 Property, Plant and Equipment and IAS 38
Intangible Assets -- Revaluation method --
proportionate restatement of accumulated
depreciation/amortisation
* IAS 19 Employee Benefits -- Discount rate: regional
market issue
* IAS 24 Related Party Disclosures -- Key management
personnel
* IAS 27 -- Equity Method in Separate Financial
Statements -- Amendments to IAS 27
* IAS 34 Interim Financial Reporting -- Disclosure of
information 'elsewhere in the interim financial
report'
The Directors have assessed that the adoption of
these revisions and amendments did not have an impact
on the financial position or performance of the group
and company.
(b) Standards, amendments and interpretations that
are not yet effective and have not been early adopted:
At the date of authorisation of these financial statements,
the following Standards and Interpretations which
have not been applied in these financial statements
were in issue but not yet effective:
Effective date - periods beginning on or after 1
January 2017
Effective date* -- 1 January 2017
* IAS 7 Disclosure Initiatives - Amendments to IAS 7
* IAS 12 Recognition of Deferred Tax Assets for
Unrealised Losses - Amendments to IAS 12
* AIP IFRS 12 Disclosure of Interests in Other Entities
-- Clarification of the scope of the disclosure
requirements in IFRS 12
Effective date* -- 1 January 2018
* IFRS 2 Classification and Measurement of Share based
Payment Transactions -- Amendments to IFRS 2
* IFRS 9 Financial Instruments
* IFRS 15 Revenue from Contracts with Customers
* IFRIC Interpretation 22 Foreign Currency Transactions
and Advance Consideration
* AIP IFRS 1 First--time Adoption of International
Financial Reporting Standards -- Deletion of
short--term exemptions for first--time adopters
* AIP IAS 28 Investments in Associates and Joint
Ventures -- clarification that measuring investees at
fair value through profit or loss is an investment --
by -- investment choice
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
1 Accounting policies (continued)
(b) Standards, amendments and interpretations that
are not yet effective and have not been early adopted:
(continued)
Effective date* -- 1 January 2019
* IFRS 16 Leases
* the standard is effective for accounting periods
beginning in or after this date
The Directors anticipate that the adoption of these
Standards and Interpretations in future periods will
have no material impact on the financial statements
of the group and company.
-------------------------------------------------------------------
2 Critical Accounting Estimates and Judgements
The Directors evaluate estimates and judgments incorporated into
the financial statements based on historical knowledge and best
available current information. Estimates assume a reasonable
expectation of future events and are based on current trends and
economic data, obtained both externally and within the Group.
Key estimates and judgements
(i) Impairment
The Group assesses impairment at the end of each reporting
period by evaluation of conditions and events specific to the Group
that may be indicative of impairment triggers. Recoverable amounts
of relevant assets are reassessed using value-in-use calculations,
which incorporate various key assumptions.
(ii) Revenue recognition
Revenue on long-term contracts requires estimates to be made of
the degree of completion and accordingly the amount of revenue and
direct costs to recognise at accounting dates.
(iii) Purchase consideration - Bachmann Plant Hire Pty Ltd
('BPH')
Under the term of the acquisition, deferred payments will become
due to the vendors computed by reference to earnings achieved by
BPH in future periods. The total consideration has been computed on
the assumption that the earnings targets specified will be achieved
but not exceeded.
(iv) Losses on termination of contracts
Following the decision to terminate these contracts, full
provision has been made for all contract costs incurred and it has
been assumed that no further amounts will be received in respect of
the outstanding sales invoices at 30 June 2017.
(v) Going concern
As explained in the accounting policy set out in note 1, the
financial statements have been prepared on the going concern basis
which assumes that the Group will continue in operational existence
for the foreseeable future.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
3 Revenue
Revenue represents amounts invoices to customers for services
provided, exclusive of Value Added Tax and similar taxes.
4 Operating segments
Operating segments are reported in a manner consistent with the
internal reporting provided to the chief operating decision-maker.
The chief operating decision-maker has been identified as the Board
of Directors.
Segmental information is as follows:
2017 Australian Australian Corporate Total Discontinued Total
Plant Mining Continuing Operations
Hire Contracting Operations
$'000 $'000 $'000 $'000 $'000 $'000
Revenue 22,208 30,061 93 52,363 3,624 55,988
Cost of sales (16,149) (23,405) - (39,553) (6,492) (46,046)
Administration
expenses (1,194) (13,208) (5,616) (20,017) (2,816) (22,834)
Depreciation (2,839) (568) - (3,407) (20) (3,427)
Gain on distressed
debt - - - - 6,025 6,025
------------ ------------- ---------- ------------ ------------- -----------
Operating
profit/(loss)
before tax 2,026 (7,120) (5,522) (10,614) 321 (10,292)
============ ============= ========== ============ ============= ===========
Income tax
expense (492) - - (492) - (492)
------------ ------------- ---------- ------------ ------------- -----------
Operating
profit/(loss)
after tax 1,534 (7,120) (5,522) (11,106) 321 (10,785)
============ ============= ========== ============ ============= ===========
` `
Capital Expenditure 3,659 4,346 - 8,005 - 8,005
============ ============= ========== ============ ============= ===========
Segment assets 19,711 13,984 4,175 37,870 - 37,870
Segment liabilities (8,831) (18,973) (6,344) (34,148) - (34,148)
============ ============= ========== ============ ============= ===========
2016 Australian Australian Corporate Total Discontinued Total
Plant Mining Continuing Operations
Hire Contracting Operations
$'000 $'000 $'000 $'000 $'000 $'000
Revenue 10,943 - 2,373 13,316 10,002 23,318
Cost of sales (8,246) - (1,820) (10,066) (13,760) (23,826)
Administration
expenses (1,308) - (924) (2,232) (2,185) (4,417)
Depreciation (1,117) - - (1,117) (75) (1,192)
Gain on acquisition
of subsidiary - - 2,152 2,152 - 2,152
Operating
profit/(loss)
before tax 272 - 1,782 2,054 (6,018) (3,964)
Income tax
expense (445) - - (445) (191) (636)
------------ ------------- ---------- ------------ ------------- -----------
Operating
profit/(loss)
after tax (173) - 1,782 1,609 (6,209) (4,600)
============ ============= ========== ============ ============= ===========
Capital Expenditure 15,739 - - 15,739 - 15,739
============ ============= ========== ============ ============= ===========
Segment assets 19,949 - 186 20,422 543 20,678
Segment liabilities (1,335) - (13,167) (14,502) (9,008) (23,510)
============ ============= ========== ============ ============= ===========
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
4 Operating segments (continued)
Revenues from transactions with customers exceeding 10% of total
revenue were as follows:
2017 2016
$'000 $'000
Customer A 13,555 -
Customer B 8,402 10,236
Customer C 7,936 -
Customer D 5,687 -
Others 16,783 3,080
------- -------
52,363 13,316
5 Administrative expenses
Acquisition expenses of $1,570,300 (2016-$792,202) represent the
professional fees and other associated costs incurred in the
acquisition of MRS SubZero in FY17 and Bachmann Plant Hire Pty Ltd
in FY16.
Details of the share based payments charge are set out in note
26.
6 Operating profit 2017 2016
$'000 $'000
This is stated after charging
the following:
Depreciation and amortisation 3,427 1,192
Lease payments - 56
Impairment losses 2,914 6,117
Foreign exchange differences 612 94
7 Auditors' remuneration 2017 2016
$'000 $'000
Fees payable to the Group's
auditors for audit of
the annual accounts
Audit of the Company
and the consolidation 51 50
Fees payable to other
auditors for audit services 235 62
Fees payable to the Group's
auditors for other services
Tax services 2 2
288 114
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
8 Staff costs and directors' 2017 2016
emoluments
$'000 $'000
Staff costs (including
directors) Group
Wages and salaries 33,602 6,712
Pension costs 2,049 195
Social security costs 551 71
36,202 6,978
The remuneration of the directors was as follows:
Share
Salaries Other based
& fees benefits payments Total
2017 2017 2017 2017
$'000 $'000 $'000 $'000
Directors' emoluments
Group - 2017
Paul Morffew (removed
28 October 2016) 163 108 40 311
Murray D'Almeida (resigned
17 March 2017) 247 - - 247
Chris Berkefeld (resigned
10 April 2017) 93 - 11 104
Timothy Jones 76 1 7 84
Joe Clayton (appointed
19 December 2016, resigned
21 August 2017) 249 470* 51 770
John Zorbas (appointed
10 April 2017) 15 - 17 32
Trevor Brown (appointed
10 April 2017) 26 - 7 33
Nigel Burton (appointed
10 April 2017) 131 1 7 139
* includes provision
for termination pay
1000 580 140 1,720
Share
Salaries Other based
& fees benefits payments Total
2016 2016 2016 2016
$'000 $'000 $'000 $'000
Directors' emoluments
Group - 2016
Paul Morffew (removed
28 October 2016) 446 36 - 482
Murray D'Almeida (resigned
17 March 2017) 135 - - 135
Chris Berkefeld (appointed
16 February 2016) 40 - - 40
Timothy Jones 98 - - 98
719 36 - 755
The key management personnel of the Group are considered to be
the Directors of Management Resource Solutions PLC.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
9 Staff numbers
The average monthly number of employees (including directors)
during the year was as follows:
2017 2016
Number Number
Group
Technical 352 99
Administrative 58 15
------- -------
410 114
======= =======
Company
Administrative 2 1
10 Finance costs 2017 2016
$'000 $'000
Interest expense 1,901 101
1,901 101
11 Taxation
Group
(a) The tax charge comprises
2017 2016
$'000 $'000
Current tax 492 226
Deferred tax - 409
Under provision in respect -
of prior years
------ -----------
492 635
(b) Reconciliation of total
tax charge:
2017 2016
$'000 $'000
Accounting loss from continuing
operations before
income tax 322 2,053
Accounting loss from discontinued
operations
before income tax (10,614) (6,018)
Total accounting loss before
income tax (10,292) (3,965)
----------- --------------
Tax at Australian statutory income
tax rate of 30% (2016 - 30%) (3,088) (1,189)
Effects of:
* derecognise DTA from prior years - 409
* unrecognised tax losses 3,580 1,415
Tax (credit)/charge 492 635
----------- --------------
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
12 Dividend Paid
2017 2016
$'000 $'000
No dividends were paid during - -
the year
- -
13 Earnings per share
The calculation of the basic and diluted earnings per share is
based on the following data:
Earnings for the purposes of earnings per share:
2017 2016
$'000 $'000
From continuing operations (11,106) 1,609
From discontinued operations 321 (6,209)
(10,785) (4,600)
Weighted average number of shares for the purposes of earnings
per share:
2017 2016
Number Number
Weighted average number
of ordinary shares in issue 85,482,507 33,173,480
Options and warrants in issue are anti-dilutive because of the
loss from continuing operations. Accordingly, the diluted EPS
calculation is identical to the basic EPS calculation.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
14 Property, plant and equipment
Leasehold Plant & Leased plant Total
improvements equipment &
equipment
$'000 $'000 $'000 $'000
Cost
At 1 July 2015 6 159 321 486
Additions - 1,494 - 1,494
Acquired - 14,245 - 14,245
Disposals - - (61) (61)
Reallocation - - - -
-------------- ----------- ------------- -------
At 30 June 2016 6 15,898 260 16,164
Additions - 3,805 - 3,805
Acquired - 4,200 - 4,200
Disposals (6) (430) (260) (696)
Reallocation - - - -
-------------- ----------- ------------- -------
At 30 June 2017 - 23,473 - 23,473
-------------- ----------- ------------- -------
Depreciation
At 1 July 2015 6 75 145 226
Charge for the
year - 1,156 36 1,192
Acquired - 1,353 - 1,353
Eliminated on
disposals - - (37) (37)
Reallocation - - 26 26
-------------- ----------- ------------- -------
At 30 June 2016 6 2,584 170 2,760
Charge for the
year - 3,415 12 3,427
Eliminated on
disposals (6) (100) (182) (288)
Reallocation - - - -
At 30 June 2017 - 5,899 - 5,899
-------------- ----------- ------------- -------
Net book value
At 30 June 2017 - 17,574 - 17,574
-------------- ----------- ------------- -------
At 30 June 2016 - 13,314 90 13,404
-------------- ----------- ------------- -------
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
15 Subsidiaries
The consolidated financial statements include the financial
statements of Management Resource Solution PLC and the following
subsidiaries:
Proportion
of voting rights
and of equity
interest
2017 2016
Management Resource Solutions
Pty Ltd (VA)* Australia 100% 100%
MRS PNG Limited (VA)* UK 100% 100%
MRS Guernsey Limited (VA)* Guernsey 100% 100%
Bachmann Plant Hire Pty.
Ltd. Australia 100% 100%
MRS Subzero Pty Ltd Australia 100% Nil
Holdings (MRS) Pty Ltd Australia 100% Nil
* Entity placed into Voluntary Administration (VA)
Management Resource Solutions Pty Ltd, MRS Guernsey Limited and
MRS PNG Limited were placed into Voluntary Administration during
FY17, prior to this, the principal activity was the supply of
technical and strategic services. The principal activity of
Bachmann Plant Hire Pty. Ltd is plant hire. The principal activity
of MRS Subzero Pty. Ltd is mining maintenance, fabrication, and
bulk earth works. The principal activity of Holdings (MRS) Pty. Ltd
is the holding company for Bachmann Plant Hire Pty Ltd and MRS
Subzero Pty Ltd, replacing Management Resource Solutions Pty
Ltd.
On 1 October, the company's wholly-owned subsidiary, MRS Subzero
Pty Ltd, acquired various assets from the SubZero Group Limited
(SZG). Initial total consideration of $6.12 million (comprising a
cash payment of $1 million on settlement, a deferred payment of
$500,000 payable in cash 12 months after the date of completion and
the issue of 7,596,967 new ordinary shares of EUR0.01 each in
Management Resource Solutions plc), less the employee entitlements.
Following the initial acquisition estimates, a reconciliation of
the book value of the assets adjusted the purchase price. The
adjusted purchase value is detailed below.
The acquisition had the following estimated effect on the
group's assets and liabilities.
Book value Fair value Fair
adjustments value
$'000 $'000 $'000
Fair value of net assets
of entity acquired:
Plant and equipment 4,200 - 4,200
Inventories 336 - 336
Work in Progress 345 - 345
Prepayments 76 - 76
Employee entitlements (741) - (741)
-
4,216 - 4,216
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
15 Subsidiaries (continued)
Under the acquisition agreement, the purchase consideration of
$4,216,000 was to be satisfied as follows:
$'000
Basic consideration 614
Shares Issued 1,859
Debt 1,743
4,216
16 Discontinued Operations
Management Resource Solutions Pty Ltd, MRS Guernsey Limited and
MRS PNG Limited were placed into Voluntary Administration during
FY17, refer to note 15 for more information.
In accordance with IFRS 5 the total profits for 2017 relating to
discontinued activities for the year were presented on a single
line on the income statement, and are analysed below:
2017 2016
$'000 $'000
Revenue 3,624 10,002
Cost of sales (3,578) (7,643)
-------- ---------
Gross profit (46) 2,359
Recurring administrative
expenses (2,194) (1,573)
-------- ---------
Profit before non-recurring
costs and finance
charges (2,148) 786
Non-recurring administrative
expenses:
Acquisition expenses (598) (531)
Amounts written off
on terminated contracts (2,914) (6,117)
Share based payment - -
charges
Gain on forgiveness 6,025 -
of distressed debt
Impairment on investments - -
-------- ---------
Operating Profit
/ (Loss) 365 (5,862)
Finance costs -
interest (44) (156)
Profit / (Loss)
before tax 321 (6,018)
Tax (expense)/credit - (191)
Profit / (Loss)
from discontinued
operations 321 (6,209)
-------- ---------
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
16 Discontinued Operations 2017 2016
(continued)
Note $'000 $'000
Assets
Non-current assets
Property, plant and equipment - 223
Other non-current assets - 4,140
- 4,363
Current assets
Trade and other receivables - 134
Cash and cash equivalents - 186
Inventories - -
- 320
Total assets - 4,683
======== ========
Liabilities
Current liabilities
Trade and other payables - 2,468
Borrowings - 234
- 2,702
Non-current liabilities
Borrowings - 3,639
Deferred tax - -
Provision - -
Other non-current liabilities - 2,667
- 6,306
Total liabilities - 9,008
Net (liabilities)/assets - (4,325)
Equity attributable to
equity holders of the
parent
Share capital - 415
Share premium - -
Issue costs reserve - -
Reorganisation reserve - -
Retained earnings - (4,740)
Total equity attributable
to equity holders of the
parent - (4,325)
----- --------
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
16 Discontinued Operations (continued)
2017
$'000
Cash flow from operating
activities
Receipts from customers 9,691
Payments to suppliers and
employees (13,243)
Interest received -
Finance costs (44)
Tax paid 25
Net cash flow from operating
activities (3,570)
Cash flow from investing
activities
Net proceeds from investment 4,140
Net proceeds from other
non-current assets 29
Net cash flow from investing
activities 4,169
Cash flow from financing
activities
Net proceeds from intercompany
loans 3,060
Net proceeds from debt
forgiveness (3,844)
Net cash flow from financing
activities (784)
Net increase/(decrease)
in cash held (186)
Cash and cash equivalents
at 1 July 2016 186
Cash and cash equivalents
at 30 June 2017 -
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
17 Deferred tax
Opening (Charged)/ (Charged)/ Closing
Balance Credited Credited Balance
to Profit/Loss to Directly
to Equity
$'000 $'000 $'000 $'000
Deferred tax assets
409 (409) - -
Balance at 30 June
2016 409 (409) - -
- - - -
Balance at 30 June - - - -
2017
Deferred tax liability
Timing differences - - - -
- - - -
Balance at 30 June - - - -
2016
Timing differences - - - -
Balance at 30 June - - - -
2017
There is an unrecognised deferred tax asset in the Group of
approximately $5,404,715 (2016 $1,825,017) in respect of tax losses
which has not been included in the balance sheet owing to
uncertainty that it will provide recoverable.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
18 Trade and other receivables 2017 2016
(current)
$'000 $'000
Trade receivables 14,615 6,032
Prepayments 21 7
Accrued Income 1,640 -
Other receivables 1,260 84
17,536 6,123
Included within trade receivables were retentions of $124,573
(2016 - $431,820).
.
The Group's ageing of trade receivables is
as follows:
Current 10,191 4,711
1 - 30 days 2,896 1,099
31 - 60 days 755 2,170
61 - 90 days 616 3,115
> 90 days 931 1,717
Provision for bad and doubtful
debts (774) (6,780)
--------- --------
14,615 6,032
19 Inventories 2017 2016
$'000 $'000
The Group's inventory is as follows:
Raw materials, stores and work in
progress 590 234
590 234
20 Trade and other payables 2017 2016
(current)
$'000 $'000
Trade creditors and accruals 2,656 5,850
Other creditors 7,911 854
Employee benefits provision 1,454 457
Owing to a former Director 450 323
Greg Bachmann - Working
Capital Loan 1,706 1,778
Current Liabilities - BPH
Earnout Payments 500 1,333
14,677 10,595
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
21 Provisions (non-current) 2017 2016
$'000 $'000
Employee benefits provision 373 190
373 190
22 Borrowings 2017 2016
$'000 $'000
Current
Lease liability secured 1,202 45
Loan from EFIC - 187
Debtor Financing 6,075 2,442
Bank loans 3,850 990
Total current borrowings 11,127 3,664
Non-Current
Lease liability secured 1,903 27
Bank loans 6,068 6,368
Total non-current borrowings 7,971 6,395
Total Borrowings 19,098 10,059
Assets pledged as security
are:
Plant and equipment -
Leased plant and equipment 13,023 10,059
13,023 10,059
Analysis of borrowings and
lease liabilities by maturity
is as follows
0 - 6 months 8,312 3,722
6 - 12 months 2,815 1,106
1 - 2 years 5,273 3,525
2 - 5 years 2,698 1,706
--------- ---------
19,098 10,059
--------- ---------
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
23 Financial instruments
The Group's financial instruments consist of deposits with
banks, money market instruments, short-term investments, accounts
receivable and payable, and borrowings. The totals for each
category of financial instrument, measured in accordance with IAS
39 as detailed in the accounting policies to these financial
statements, are as follows:
2017 2016
$'000 $'000
Financial assets
Cash and cash equivalents 2,029 894
Receivables 15,875 6,116
Total Financial Assets 17,904 7,010
======= =======
Financial liabilities
Trade and other payables 14,536 14,563
Borrowings 19,098 10,059
Total Financial Liabilities 33,634 24,622
In the opinion of the Directors, the fair value of the financial
assets and financial liabilities is the same as the amount stated
above.
Financial Risk Management/Capital Management Policies
The Directors' overall risk management strategy seeks to assist
the Company in meeting its financial targets, whilst minimising
potential adverse effects on financial performance. Risk management
policies are approved and reviewed by the Board of Directors on a
regular basis. These include the credit risk policies and future
cash flow requirements.
Specific Financial Risk Exposures and Management
The main risks the Group is exposed to through its financial
instruments are credit risk and liquidity risk. There have been no
substantive changes in the types of risks the Company is exposed
to, how these risks arise, or the Board's objectives, policies and
processes for managing or measuring the risks from the previous
period.
a. Credit risk
Exposure to credit risk relating to financial assets arises from
the potential non-performance by counterparties of contract
obligations that could lead to a financial loss to the Group. The
Group is also exposed by its concentration on a small number of
major clients. The Group's maximum exposure to credit risk is its
total receivables.
Credit risk is managed through maintaining procedures ensuring,
to the extent possible, that customers and counterparties to
transactions are of sound credit worthiness and includes the
utilisation of systems for the approval, granting and renewal of
credit limits, the regular monitoring of exposures against such
limits and the monitoring of the financial stability of significant
customers and counterparties. Such monitoring is used in assessing
receivables for impairment. Depending on the division within the
Group, credit terms are generally 15 to 30 days from the date of
invoice.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
23 Financial instruments (continued)
Risk is also minimised through investing surplus funds in
financial institutions that maintain a high credit rating or in
entities that the finance committee has otherwise assessed as being
financially sound. Where the Group is unable to ascertain a
satisfactory credit risk profile in relation to a customer or
counterparty, the risk may be further managed through title
retention clauses over goods or obtaining security by way of
personal or commercial guarantees over assets of sufficient value
which can be claimed against in the event of any default.
b. Liquidity risk
Liquidity risk arises from the possibility that the Group might
encounter difficulty in settling its debts or otherwise meeting its
obligations related to financial liabilities. The Group manages
this risk through the following mechanisms:
3/4 preparing forward-looking cash flow analyses in relation to
its operational, investing and financing activities;
3/4 managing credit risk related to financial assets;
3/4 only investing surplus cash with major financial institutions; and
3/4 comparing the maturity profile of financial liabilities with
the realisation profile of financial assets.
At the balance sheet date, the Group's only borrowings were
those set out in note 19 and all cash resources were available on
demand.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
24 Share capital
Authorised, issued and fully Ordinary Shares Deferred Shares
paid
Nominal value per share
EUR0.01
Number $'000 Number $'000
At 1 July 2016 36,346,093 457 30,400,015 36,220
To satisfy a key condition
precedent to complete the
acquisition of core assets
of SubZero Group Limited 26,666,667 396
Part consideration of acquisition
of core assets of SubZero
Group Limited 7,596,967 130
Consideration to Align Research
as payment for work completed 228,571 3
BPH First Earn-Out Payment
to G Bachmann 3,610,226 51
Consideration to RFC Ambrian
as payment for work completed 397,353 6
BPH Second and Third Earn-Out
Payments to G Bachmann 11,051,261 155
Capital Raise - Share Allotment 70,000,000 1,021
Consideration to Vantage
Performance as payment for
work completed 1,823,708 27
Broking Commission 6,000,000 88
Director - Tim Jones - in
lieu of accrued fees 347,240 5
Capital Raise - Share Allotment
to Directors 10,000,000 148
Consideration to Align Research
as payment for work completed 360,000 5
At 30 June 2017 174,428,086 2,491 30,400,015 36,220
25 Warrants
In connection with its admission to listing on AIM on 11
December 2014, the Company issued 2,566,667 warrants to subscribe
for new Ordinary Shares, at 30p per share, to investors and
advisors. The Warrants are exercisable in whole or in part until
the third anniversary of the admission to listing (11 December
2017) and are non-transferable. No warrants were exercised during
the year and all remained outstanding at 30 June 2017. No
application has been made or will be made for the Warrants to be
admitted to trading on AIM.
On 4 April 2017, the Company issued a total of 10,407,120
warrants to subscribe for new Ordinary Shares in the company, at 5p
per share, in settlement of various creditors and obligations to
directors.
Included in the total were 360,000 warrants issued to Timothy
Jones, a director, in consideration of his waiving of the provision
in his agreement of three months' notice.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
25 Warrants (continued)
On 5 May 2017, the company issued 10,407,120 warrants to
subscribe for new ordinary shares in the company, at 5p per
share.
GW (Joe) Clayton 2,500,000 warrants
Chris Berkefeld 547,120 warrants
Vantage Performance 5,000,000 warrants
Tim Jones 360,000 warrants
Paul Morffew 2,000,000 warrants
On 8 June, the Company issued warrants to subscribe for new
Ordinary Shares in the Company, subject to certain performance
conditions, at 5p per share (the NED warrants), to the Company's
directors as follows:
John Zorbas 4,700,000 warrants
Trevor Brown 2,000,000 warrants
Nigel Burton 2,000,000 warrants
Subject to the performance conditions attaching to the NED
warrants, all the above warrants are exercisable (in whole or in
part) at any time up to the fifth anniversary of the date of issue,
after which they will lapse.
The Group recognised a share based payment charge of $241,395
(2016, $nil) in respect of the warrants (calculated using the
Black-Scholes model). The inputs to the model were as follows:
Share Price 4.5 -5.5p
Excursive Price 5p
Expected Volatility 14%
Risk free rate of interest 0.50%
Expected life 5 years
No warrants were exercised during the year and all remained
outstanding at 30 June 2017. No application has been made or will
be made for the warrants to be admitted to trading on AIM.
Information on warrants exercised since 30 June 2017 is given in
note 29.
26 Share options
Grant of Options
On 11 December 2014, in connection with the admission to listing
of the Company's Share Capital, the following options over ordinary
shares of EUR0.01 in the capital of the Company ("Ordinary Shares")
were granted to directors and employees of the company.
No of Options
2017 2016 Exercise
Price
Paul Morffew (former
director) - 1,640,834 30p
Murray D'Almeida
(director) - 492,250 30p
Timothy Jones
(director) - 492,250 492,250 30p
Employees - 239,083 30p
Employees - 400,000 EUR0.01
-------------------------- ------------------
492,250 3,264,417
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
26 Share options (continued)
492,250 options, representing 0.3% of the Company's issued share
capital, were outstanding at 30 June 2017. The other options have
lapsed following the resignation or termination of the employment
of the option holders. The options are exercisable (in whole or in
part) at any time up to the seventh anniversary of the date of the
grant after which they will lapse.
No options over ordinary shares were granted during the years
ended 30 June 2016 or 2017.
27 Reserves
Reserve Description and purpose
Share capital Amount subscribed for share capital at nominal value.
Share premium Amount subscribed for share capital in excess of
minimal value, net of allowable expenses.
Issue costs reserve Costs associated with the reorganisation described under "Business combinations: in note 1.
Reorganisation reserve Excess of the nominal value of shares
issued in exchange for the shares in Management Resource Solutions
Pty Ltd.
Retained earnings Cumulative net gains and losses recognised in the statement of comprehensive income.
Details of movements in each reserve are set out in the
Consolidated Statement of Changes in Equity.
28 Leasing commitments
2017 2016
$'000 $'000
Finance lease commitments
Payable - minimum lease
payments
no later than 12 months 1,202 45
between 12 months and
two years 1,202 27
between two and five years 701 -
Minimum lease payments 3,105 72
Present value of minimum
lease payment 3,105 72
During February 2017 the Bachmann Plant Hire Pty Ltd "Rent to
Buy" agreement was finalised. For the periods February 2016 to
January 2017, the repayments of the "rent to buy" agreement were
treated as rental expense. From February 2017 the "rent to buy"
assets are recognised in the PP&E and the residual financial
liability is recognised as a finance lease. The "rent to buy"
assets are being depreciated over the residual rental period.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
29 Related party transactions
Disclosure regarding remuneration of the Directors is given in
note 8, and the Directors' Report. Details of the Group's
subsidiaries, which are considered to be related parties, are given
in note 15.
Environmental Auditors Australia Pty Ltd and SCOPN Super Pty
Ltd, both companies controlled by Paul Morffew, then a director,
and his wife, provided office space at a total charge of $30,000
(2016 - $62,000).
Per the "Deed of Settlement" with Mr Paul Morffew and SCOPN Pty
Ltd, Mr Morffew received:
-- $323,910.66 repayment of loan from Management Resource
Solutions plc
-- 2,000,000 warrants
-- Pay out up to $100,000 to suppliers to which Mr Morffew gave
personal guarantees whilst in the role of CEO of MRS Group
($71,562.42 paid to date).
-- $90,000 lump sum employment termination
and in addition to this
-- Forgiveness of $200,000 loan from Management Resource
Solutions Pty Ltd
Lindfield Associates Pty Ltd was paid $38,000 (2016-nil) for
services provided by former director Chris Berkefeld during January
and February 2017, a period in which he was not serving as a
director.
During 2017 the working capital loan to Greg Bachmann (and
family) was transferred from Management Resource Solutions Pty Ltd
to Holdings (MRS) Pty Ltd. The principle value of the loan is
$1,650,000 and is subject to interest of 9.45% per annum
30 Contingent asset/liability
No contingent assets or liabilities have been recognised.
31 Subsequent events
-- On 21 August 2017 GW (Joe) Clayton ceased to be a Director
and Chief Executive Officer for the Company and all its
subsidiaries.
-- On 28 September 2017, the Voluntary Administrator of MRS PNG
Limited advised that the administration process had finalised and
the company is being deregistered
-- On 5 October 2017, the London Stock Exchange published
details of a censure of the Company and a fine of GBP125,000 for
historic breaches of the AIM Rules, discounted to GBP85,000 for
early settlement of the proceedings. The Exchange states in its
announcement that since the events that are the subject of this
censure:
-- save for the finance director, the Company has a new
board;
-- when the matter was brought to the attention of the finance
director, the nominated adviser was immediately made aware of the
issues and action was taken;
-- none of the current members of the board bear any
responsibility for these breaches.
-- On 19 October 2017, the Joint Voluntary Liquidators of MRS
Guernsey Limited withdrew their claim for A$3.6m
-- On 26 October 2017 John Zorbas, Chairman of the Company
exercised 2,350,000 Warrants at an exercise price of 5p each.
-- On 30 October 2017, payment of $500,000 due as deferred
consideration to the vendors of Bachmann Plant Hire Pty Ltd was
satisfied by $200,000 cash and issue of $300,000 shares in
Management Resource Solutions plc.
-- On 17 November 2017, the Deed Administrators of Management
Resource Solutions Pty Ltd advised that the Deed of Company
Arrangement executed on 3 April 2017 has been fully effectuated.
The company is now in the process of being deregistered.
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
31 Subsequent events (continued)
-- On 8 December 2017, the Joint Voluntary Administrator of MRS
Guernsey Limited advised that the company is been approved to be
deregistered.
Issue of shares
On 26 October 2017, John Zorbas, a director, exercised 2,350,000
NED Warrants at an exercise price of 5p each. The consideration
received by the Company was $117,500 (approximately $0.2
million).
On 27 October 2017, 3,167,916 Ordinary Shares in the Company
were issued to the vendors of Bachmann Plant Hire Pty Ltd in part
settlement of deferred consideration of $500,000. Based on the
calculation set out in the purchase agreement, the value of those
shares was $300,000. The balance of $200,000 was settled in
cash.
32 Restatement of Financial Results
2016 Increase/ 2016
(decrease) (Restated)
$'000 $'000
Revenue 25,231 (1,913) 23,318
Cost of sales (19,536) 1,827 (17,709)
--------- ------------- ------------
Gross profit 5,695 (86) 5,609
Recurring administrative
expenses (5,336) 860 (4,476)
--------- ------------- ------------
Profit before non-recurring
costs and finance
charges 359 774 1,133
Non-recurring administrative
expenses:
Acquisition expenses (876) - (876)
Amounts written
off on terminated
contracts (6,588) 471 (6,117)
Share based payment - - -
charges
Gain on acquisition
of subsidiary 808 1,344 2,152
--------- ------------- ------------
Operating loss (6,297) 2,589 (3,708)
Finance costs -
interest (260) 4 (256)
Loss before tax (6,557) 2,593 (3,964)
Tax (expense)/credit (305) (331) (636)
(Loss) for the
year attributable
to equity holders
of the parent company (6,862) 2,262 (4,600)
(Loss) per share
attributable to
equity of the parent
company
Basic and diluted (20.7)c 6.8c (13.9)c
--------- ------------- ------------
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
32 Restatement of Financial Results (continued)
2016 Increase/ 2016
(decrease) (Restated)
Note $'000 $'000 $'000
Assets
Non-current assets 13,749 (345) 13,404
Current assets 7,668 (397) 7,274
Total assets 21,417 (739) 20,678
========== ============= ============
Liabilities
Current liabilities 17,564 (3,086) 14,259
Non-current liabilities 9,009 242 9,251
-------------
Total liabilities 26,573 (3,001) 23,510
Net (liabilities)/assets (5,156) 2,262 (2,832)
Total equity attributable
to equity holders
of the parent `(5,156) 2,262 (2,832)
========== ============= ============
Revenue: reduction in Revenue is due to a number of corrections,
1) reallocation of Other Income to Cost of Sales, the majority of
the Other Revenue is fuel rebates, this is a correction of a prior
year allocation, 2) intercompany sales where not correctly
eliminated in the previously issued accounts and 3) correction in
revenue raised to customers, which also resulted on a reduction in
the provision of doubtful debts.
Cost of Sales: reduction in Cost of Sales is due to a number of
corrections, 1) the reallocation of the fuel rebates and 2)
correction of the elimination of the intercompany sales.
Reoccurring Administrative expenses: the reduction is due to the
reversal of the repairs and maintenance provision.
Amounts written off on terminated contracts: reduction due to
correction in provision for doubtful debts
Gain on acquisition of subsidiary: the correction in the
acquisition accounting for Bachmann Plant Hire Pty Ltd (BPH).
Non-current Assets: the movement is due to the finalisation of
the tax review for 2016
Current Assets: the movement is due to the correct elimination
of intercompany transactions
Current Liabilities: the movement is due to a number of
corrections 1) correct allocation between current and non-current
borrowings, 2) correction in the liability due to the incorrect
acquisition accounting for BPH and 3) the elimination of
intercompany transactions.
Non-current Liabilities: the movement is due to the offset of
the reversal of the provision for repairs and maintenance and the
correction in the allocation of Borrowings
Management Resource Solutions PLC
Notes to the consolidated financial statements
for the year ended 30 June 2017 (continued)
This page is intentionally left blank
Management Resource Solutions PLC
Parent company Balance Sheet
At 30 June 2017
Parent Company Balance Sheet
2017 2016
Notes $'000 $'000
Fixed assets
Investments in subsidiaries 4 - -
Current assets
Trade and other receivables 5 7,002 53
Cash assets 715 60
7,717 113
--------- ---------
Total assets 7,717 113
========= =========
Current liabilities
Amounts falling due within
one year 6 (270) (4,080)
Net assets 7,447 (3,967)
Capital and reserves
Share capital 7 38,711 36,677
Share premium 16,807 1,744
Issue costs reserve (193) (193)
Reorganisation reserve (35,341) (35,341)
Retained earnings (12,536) (6,854)
Shareholders' funds 7,447 (3,967)
The financial statements were approved by the board of Directors
and authorised for issue on 20 December 2017 and were signed on its
behalf by:
John Zorbas Timothy Jones
Director Director
Management Resource Solutions PLC
Parent company Statement of Changes in Equity
At 30 June 2017
Parent Company Statement of Changes in Equity
Share Capital Share Issue Reorganisation Retained Total
Premium costs reserve earnings equity
reserve
$'000 $'000 $'000 $'000 $'000 $'000
At 1 July 2015 36,623 1,221 (193) (35,341) (1,864) 446
Loss for the Year - - - - (4,990) (4,990)
---------------- ----------
Total comprehensive income - - - - (4,990) (4,990)
---------------- ---------- ---------- ----------------- ----------- ---------
Other movements
Issue of Shares 54 523 - - - 577
Expenses of
issue - - - - - -
Total other
movements 54 523 - - - 577
------- ------- ------ --------- --------- --------
At 1 July 2016 36,677 1,744 (193) (35,341) (6,854) (3,967)
Loss for the
Year - - - - (5,923) (5,923)
------- ------- ------ --------- --------- --------
Total comprehensive
income - - - - (5,923) (5,923)
Other Movements
Issue of Shares 2,034 15,972 - - - 18,005
Share based
payments charge - - - - 241 241
Expenses of
issue - (909) - - - (909)
------- ------- ------ --------- --------- --------
Total other
movements 2,034 16,807 - - 241 17,338
------- ------- ------ --------- --------- --------
At 30 June 2017 38,711 16,807 (193) (35,341) (12,536) 7,447
======= ======= ====== ========= ========= ========
Management Resource Solutions PLC
Notes to the parent company Balance Sheet for the year ended 30
June 2017
The separate financial statements of the Company are presented
as required by the Companies Act 2006
1 Accounting policies
Basis of preparation
The accounts are prepared under the historical cost convention
and in accordance with applicable UK accounting standards. Refer to
the Group accounting policies save as outlined below.
The parent company financial statements have been prepared in
accordance with Financial Reporting Standard 101 "Reduced
Disclosure Framework" (FRS101)
As permitted by FRS101 no parent company cash flow statement has
been presented. In addition, the following disclosure exemptions
have been taken:
-- disclosure requirements of paragraphs 45(b) and 46 to 52 of IFRS 2 Share-based Payment;
-- disclosure requirements of IFRS 7 Financial Instruments: Disclosures;
-- the requirement in paragraph 38 of IAS 1 Presentation of
Financial Statements to present comparative information in respect
of paragraph 73(e) of IAS 16 Property, Plant and Equipment;
-- disclosure requirements of paragraphs 134 to 136 of IAS 1
Presentation of Financial Statements in respect of capital
management;
-- disclosure about the effects of new but not yet effective IFRSs under IAS 8; and
-- disclosure requirements in respect of the compensation of Key
Management Personnel under IAS 24 Related Party Disclosures.
Investments
Investments are stated at cost less provision for any permanent
diminution in value. Amounts receivable from subsidiary
undertakings are assessed for impairment and provisions made where
appropriate.
2 Loss attributable to members of the parent company
The loss dealt with in the financial statements of the parent
company is $5,923,000 (2016 - $4,990,000). As permitted by s408 of
the Companies Act 2006, the Company has elected not to present its
own profit and loss account for the year.
3 Staff costs and directors' emoluments
These are disclosed in note 8 & 9 to the consolidated
financial statements.
4 Investments in subsidiaries 2017 2016
$'000 $'000
Cost
At 1 July 2016 - -
At 30 June 2017 - -
Details of holdings in subsidiary companies are set out in note
15 to the consolidated financial statements.
Management Resource Solutions PLC
Notes to the parent company Balance Sheet for the year ended
June 2017 (continued)
5 Trade and other receivables 2017 2016
$'000 $'000
Other debtors 10 204
Amounts owing by group undertakings 6,992 -
7,002 53
Amounts owing by group undertakings
are repayable on demand and not
interest bearing.
6 Creditors: amounts falling due
within one year
$'000 $'000
Trade creditors and accruals 39 140
Other creditors 231 88
Amounts owed to group undertakings - 3,617
Amount owing to a former
Director - 323
270 4,080
`
Amounts owed by group undertakings
are repayable on demand and not
interest bearing.
7 Share capital
Details of the share capital are set out in note 24 to the
consolidated financial statements.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR PGGWUPUPMGWU
(END) Dow Jones Newswires
December 20, 2017 08:30 ET (13:30 GMT)
Management Resource Solu... (LSE:MRS)
Historical Stock Chart
From Jun 2024 to Jul 2024
Management Resource Solu... (LSE:MRS)
Historical Stock Chart
From Jul 2023 to Jul 2024
