Taxation The e¦ective rate of corporation tax was 13.5% (2016:14.7%) which was lower than the standard UK corporation tax rate of 19.2% (2016: 20.0%). This reflects the impact of long-term capital investment programmes, permanent and temporary timing di¦erences. The Group generates revenue, profit and employment, all of which deliver substantial tax revenues for the UK government in the form of VAT, Income Tax and Corporation Tax. The Group’s tax policy, which has been approved by the Board aligns with this strategy and ensures that the Group fulfils its obligations as a responsible UK taxpayer. Dividend The Board approved an interim dividend of 31.4p per share (2016: nil) which was paid on 28 November 2017 to shareholders registered on 27 November 2017 and does not propose a final dividend. The total dividend for the year of 31.4p per share is covered 5.0 times by earnings. Financial Position Net assets increased by £5.9m to £16.2m (2016:10.3m). The net book value of tangible fixed assets and software increased by £1.7m to £9.9m due to the growth in capital additions net of depreciation. Debtors reduced by £1.8m to £75.2m (2016: £77.0m) due to improvements in credit control which o¦set the impact of the Prism acquisition and increased revenue in December. Creditors payable in less than one year increased by £11.3m to £103.3m (2016: £92.0m) due to the acquisition of Prism, an increase in deferred income in Doordrop Media and other accruals.
Cash flow Cash flow from operating activities was £19.9m (2016: £11.8m) and has improved in comparison to 2016 due to cash generation from profitable trading in 2017 and working capital management. Net investments in fixed assets of £4.3m relate to additions including the new Bolton super depot, parcel sortation and continued investment in the network and e¤ciency projects. Cash inflow from financing of £1.2m includes grants received in relation to the new super depot in Bolton, interest charges which predominately relate to supplier guarantees and proceeds from issue of shares to new shareholders. Credit and working capital management The Board of Management closely monitors credit and liquidity risks and is continually looking for improvements to working capital management. Days of trading in accounts receivable and accrued income, a key measure of debtor performance in Downstream Access and Parcels, reduced from 39.0 days to 36.8 days from 2016 and 2017. Overdue debtors as a percentage of the total ledger at the year-end fell from 12.7% to 7.3%. Going concern After reviewing the Group’s forecasts and projections, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. The Group and company therefore continues to adopt the going concern basis in preparing its consolidated financial statements. Key performance indicators The Directors are reliant on specific key performance indicators such as, statistics related to market share, sales growth and profitability to provide important guidance as to likely activity and performance within the business. The key performance indicators are described within this Strategic report.
Provisions for liabilities reduced by £0.8m due to the unwinding of residual Final Mile related liabilities.
Manoj Parmar CFO
April 2018
CFO Financial Review | Whistl Annual Report 2017
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