wynnstay group plc annual report 2014

Wynnstay Group Plc SPRING CEREAL SEEDS 2015

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2 www.wynnstay.co.uk

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Financial Highlights

STRATEGIC REPORT

Principal Activities and Business Model

Group Strategy

Chairman’s Statement

Chief Executive’s Review

Finance Review

Key Performance Indicators and Risk Management

GOVERNANCE

Advisors and Board

Directors’ Report

Corporate Governance Statement

Directors’ Remuneration Statement

Independent Auditor’s Report

FINANCIAL STATEMENTS

Consolidated Statement of Comprehensive Income

Consolidated and Company Balance Sheet

Consolidated and Company Statement of Changes in Equity

Consolidated and Company Cash Flow Statement

Principal Accounting Policies

Notes to the Financial Statements

SHAREHOLDER INFORMATION

Notice of Annual General Meeting

Notes to Notice of Annual General Meeting

Financial Calendar

Contents

3

4

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10

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64

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Wynnstay Group manufactures and supplies agricultural products to farmers and the wider rural community in Wales, the Welsh border counties, the Midlands, Lancashire and Yorkshire.

The Group operates two core divisions, Agriculture and Specialist Retail which includes the country stores business and the dedicated pet product stores.

Additionally the Group has interests in Joint Ventures and an Associate Company.

Delivering sustainable

growth on a solid

foundation

Wynnstay Group Plc ANNUAL REPORT 2014 3

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2014 2013

Group Revenue £413.56 million £413.48 million

Earnings per Share 35.28 pence 36.43 pence

Shareholders’ Funds £77.23 million £71.55 million

Group EBITDA £11.37 million £11.51 million

Group Pre-Tax Profit* £8.60 million £8.46 million

Dividend per Share 10.20 pence 9.30 pence

* Group pre-tax profits include the Group’s share of pre-tax profit from joint ventures and associate investments, but excluding the exceptional costs.

Financial Highlights

Growth Record

34

6.1

8

37

5.7

8

24

3.7

4

21

4.9

5

2011

2012

2010

2009

6.9

4 7.8

2

5.9

5

5.2

0

2011

2012

2010

2009

2011

2012

2010

2009

30

.23 3

4.9

9

27

.48

26

.42

41

3.4

820

133

6.4

320

13

8.4

620

13

Group Revenue (£m)

£413.56m(2013: £413.48m)

+0.02%

41

3.5

620

14

Group Pre-Tax Profit* (£m)

£8.60m(2013: £8.46m)

+1.65%

8.6

020

14

Earnings per Share (pence)

35.28p(2013: 36.43p)

-3.16%

35

.28

2014

Dividend per Share (pence)

10.20p(2013: 9.30p)

+9.68%

7.8

0 8.5

0

7.1

0

6.5

0

2011

2012

2010

2009

9.3

020

13

10

.20

2014


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Principal Activities and Business Model

Agriculture Specialist RetailThe Agriculture Division covers the manufacturing and supply of a comprehensive range of agricultural inputs to customers throughout Wales, the West Midlands, Lancashire and Yorkshire.

Our Retail Division covers the supply of specialist agricultural and retail products to customers throughout Wales, the Midlands and Lancashire.

Feed Division

The Feed Division, which operates two compound feed

mills and one blending plant, offers a full range of animal

nutrition products to the agricultural market. The location

of the mills allows for logistically efficient delivery of our

products throughout our trading area, third party mills are

also used to satisfy additional seasonal and geographic

requirements. Both mills are multi species allowing the

business to provide a broad range of products to service the

requirements of ruminant and monogastric animals.

Glasson, which operates from Glasson Dock near Lancaster

has traditionally been a raw materials trader and fertiliser

blender. Glasson’s activities now include the packaging of

added value products supplied to specialist animal feed

retailers. The business is also involved in a joint venture,

FertLink, which has production facilities at Birkenhead and

Goole.

Arable Division

The Arable Division supplies a wide range of products

to arable and grassland farmers throughout the trading

area. The Group is recognised as a significant supplier of

fertiliser, acting as a principle supplier of GrowHow and

Yara products together with our own Top Crop brand of

fertiliser. Seed is processed in Shropshire at the arable base

as well as at Woodheads Seeds in Yorkshire. Agrochemicals

are supplied to complete the range of products.

GrainLink, the Group’s in-house grain marketing company,

provides farmers with an independent professional

marketing service backed by the financial security of

the Wynnstay Group. The Company has access to major

markets for specialist milling and malting grain as well as

feed into mills throughout our trading area.

Woodheads Seeds operates a seed processing plant, near

Selby in Yorkshire, supplying a full range of cereal and

herbage seeds to farmers and wholesale customers. The

Company also trades grain and supplies fertiliser to farmers

in its trading area.

Wynnstay Stores

The rural retail outlets are well established and provide

a comprehensive range of products for farmers and rural

dwellers. The stores, which now number 42, operate

throughout Wales, the West Midlands and Lancashire,

and supply a wide range of specialist products to farmers,

smallholders and pet owners. Our dedicated team are happy

to help customers with technical advice on all aspects of

the wide range of products available. Our increased diversity

complements our core agricultural business, acting as an

important route to market for pharmaceutical companies

with whom the Group works closely to provide specialist

professional advice to livestock farmers.

Just for Pets

Just for Pets, which is based in Hartlebury in Worcestershire,

currently has 20 specialist pet product stores operating on

busy retail sites throughout the West Midlands extending

east to Cambridge and south to Bristol. All stores offer a

wide range of pet related products and are recognised as

convenient one stop shops for all pet owners. Our staff

have considerable experience within the pet sector and a

significant proportion are qualified to offer specialist advice

to pet owners. Two stores have an easipetcare concession

offering veterinary clinic advice and services to customers;

this is further complimented by vaccination clinics in six of

our other stores.

Youngs Animal Feeds

Youngs Animal Feeds manufactures equine and small

animal feeds from its production facility at Standon in

Staffordshire. It also acts as a distributor of products to the

equine market through wholesalers and retailers in the west

of the UK.

The Group principally operates as a leading supplier of agricultural products and services in the rural economy with the extension of activities to include specialist pet products in selected urban locations. There are two complementary divisions, Agriculture and Specialist Retail, further strengthened by the involvement in Joint Ventures and an Associate Company. By recognising the importance of quality, value and advice the Group strives to be the “supplier of choice” for its customer base.

The Group

seeks to excel

in terms of

value, quality

and service

The Group is committed to becoming a leading supplier of products and services in the rural and wider economy.

Operational Strategy

The Group has a broad based business model supplying a full range of products to a wide customer base. Its activities are supported by positive macro-economic factors including, a growing world population and dietary change which is creating an increased demand for food products. The UK government has recognised the strategic importance of food production and promotes moves for greater productivity and self-sufficiency within the agricultural industry.

These factors create a sustainable market for products and services provided by the Group and gives opportunity for further development of the business model. However, the Board has always recognised that the natural processes involved in food production will create risks to certain enterprises at different times, either through climatic, disease, economic or other factors. The Group’s strategy is designed to minimise such risks through ensuring a broad and balanced spread of activities across the main agricultural input areas, rather than relying on any specific single enterprise. This strategy has provided resilience for the Group during periodic commodity volatility.

The main markets that the Group operates in are currently supplied by a relatively fragmented base. This provides a strong platform for the development of the business, which has a long track record of both organic and acquisitive growth. The Board is confident that with the expertise, balance sheet strength, and

Locations

Group Strategy

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5

enthusiasm of staff available to the business, the consolidation strategy successfully carried out for a number of years can continue. The strategy of continued geographic expansion and organic growth, by focusing on product innovation and efficiency of supply, is designed to optimise returns to all stakeholders.

Corporate goals have been identified to monitor the strategic success and value of the business to all stakeholders.

Corporate Goals

Customers – the Group seeks to excel in terms of value, quality and service.

Employees – the Group aims to attract, develop and reward high calibre personnel, and ensure a safe, interesting and productive environment to work in, thus encouraging the highest levels of customer service.

Shareholders – the Group aims to maximise net worth through a progressive dividend policy and a financial performance that supports capital growth in share value.

Suppliers – the Group wishes to provide the best marketing route, thereby procuring preferential terms and offering better value for its customers.

Business review and future developments

A review of the business and future developments of the Group are presented in the Chairman’s Statement and Chief Executive’s Review. A discussion of the principal risks and uncertainties faced by the Group are provided later in this section of the annual report.

Wynnstay Group Plc ANNUAL REPORT 2014


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Chairman’s Statement

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Overview

Wynnstay has performed well during the year, with

increased profits and the successful integration of

recent acquisitions aiding the expansion of our

Specialist Retail Division. The variable climatic

conditions experienced over the past few years

have created volatility in the agricultural market.

This has been evident in a significant variation in

yields of agricultural outputs, ultimately leading

to a reduction in commodity pricing over the last

twelve months.

Wynnstay’s diversified spread of agricultural

activities helps balance the effect of volatility

within its markets. The benefit of Wynnstay’s

cross-sector activities has been particularly

evident in the year under review, which saw a

movement of income between the two halves

of the financial year and indeed within different

sectors of the Group.

Overall Group pre-tax profits increased to

£8.60m year-on-year, a record high. Revenues of

£413.56m were similar to the prior year reflecting

both the increase in trading activity and price

deflation across the sector.

Deflation was particularly evident within the

Agricultural Division where, despite an overall

increase in volumes of trade, revenues reduced

by 4% to £308.71m. Operating profit reduced to

£3.80m mainly as a result of margin pressure

on agricultural inputs and lower than expected

market activity in fertiliser and grain in the second

half of the year, a reduction which affected the

sector as a whole.

Our Specialist Retail Division, which includes the

agriculturally-biased Wynnstay Stores, Just for

Pets and Youngs Animal Feeds, performed well

during the year. Revenue increased by 16% to

£104.62m boosted by the Carmarthen & Pumsaint

Farmers business (“CPF”) acquired in October

2013. Operating profit increased by 10% to

£4.88m. Wynnstay Stores now operates from 42

outlets, forming an essential link between farmer

customers and our Agricultural Division.

Financial Results

Revenues for the year to 31 October 2014 were

similar to the previous year at £413.56m (2013:

£413.48m). The Agricultural Division contributed

£308.71m (2013: £323.00m) to the total,

with commodity price deflation significantly

affecting its result. The Specialist Retail Division

contributed £104.62m (2013: £90.19m), with the

year-on-year increase mainly driven by a first

full year’s contribution from the CPF acquisition,

which was completed in October 2013.

Group pre-tax profit was £8.60m (2013: £8.46m

prior to £0.35m of exceptional costs relating to

the CPF acquisition and £8.11m after exceptional

costs). The operating profit contribution from the

Agricultural Division, including joint ventures,

showed a year-on-year reduction at £3.80m

(2013: £4.90m). This decrease primarily reflected

margin pressure from lower market demand

across core product categories. Including

joint ventures the Specialist Retail Division

contributed an operating profit of £4.88m (2013:

£4.43m), with the CPF acquisition performing

ahead of initial expectations. Other activities

showed an operating profit of £0.25m (2013: loss

of £0.39m) benefiting from improved joint venture

contributions.

Net finance charges amounted to £0.33m (2013:

£0.48m) due to reduced average net debt. After a

Group taxation charge of £1.90m (2013: £1.94m),

net earnings were 8.5% higher year-on-year at

£6.70m (2013: £6.17m). This equates to 35.28p

per share (2013: 36.43p). There was an increased

number of shares in issue in the year following

the fund raising in September 2013 to acquire the

CPF business.

Net assets at 31 October 2014 were 8% higher

at £77.23m or £4.07 per share (2013: £71.55m or

£4.22 per share).

Strong cash flow produced a net cash position

at the year end of £2.75m (2013: net debt

£2.49m), with commodity deflation contributing

to an improved working capital position and cash

utilisation.

The return on net assets was 11.3% (2013: 12.1%),

with the reduction mostly attributable to the

additional capital raised towards the end of last

year for the acquisition of CPF, from which further

integration benefits are still expected.

Group Reorganisation

We completed the Group restructuring prior to

the commencement of trading for the 2013/14

financial year, transferring the existing trading

activities conducted through Wynnstay Group Plc

into our trading subsidiary, Wynnstay (Agricultural

Supplies) Limited which was initially established

to effect our acquisition of the CPF business.

This internal reorganisation has created a holding

company and six trading subsidiaries which

conduct the commercial activity of the business.

Accordingly, the Company’s financial statements

reflect the reorganisation.

Diversified

activities

balance

volatility


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Dividend

The Board is pleased to propose the payment of

a final dividend of 6.80p per share (2013: 6.20p),

representing a rise of 9.7% year-on-year. This,

together with the interim dividend of 3.40p per

share, paid on 31 October 2014, takes the total

dividend for the year to 10.20p, an increase of

9.7% on the prior year (2013: 9.30p).

The final dividend will be paid on 30 April 2015

to shareholders on the register on 27 March 2015.

Subject to shareholder approval, a scrip dividend

alternative will continue to be available as in

previous years. The last date for election for the

scrip dividend will be 16 April 2015.

The Board

In July 2014, we were delighted to welcome

Howell Richards to the Board as a Non-executive

Director. He has over thirty years experience of

the agricultural industry and practical experience

of the commercial challenges in UK farming

today, having established one of the largest dairy

farms in the UK. Wynnstay will benefit from his

knowledge and expertise.

Non-executive Director, Jeff Kendrick, retired from

the Group at Wynnstay’s AGM in March 2014 and

I would like to express the Board’s thanks once

again for his tremendous contribution over 25

years of service. We also announce today that

Lord Carlile will be retiring from the Board and

the Company at the Group’s forthcoming AGM.

Lord Carlile has added significant value as a Non-

executive Director for over 16 years and Wynnstay

has greatly benefited from his experience and

wise counsel. We intend to make another Non-

executive appointment in due course.

Colleagues

All colleagues at Wynnstay show great dedication

and commitment both to the Group and our

customers. On behalf of the Board, I express our

appreciation and gratitude; – Wynnstay’s success

is the product of everyone’s hard work, passion

and dedication.

Outlook

Long term prospects for the UK agricultural

industry remain buoyant despite the short term

issues which have arisen as a result of the decline

in output prices. The industry remains cyclical,

mainly driven by climatic conditions, with the

resultant price volatility. While output prices

for our farmer customers are currently weak,

especially for the dairy sector, macro-economic

factors, including increasing global food demand,

should drive a return to more realistic prices.

Wynnstay is well placed to meet the short term

challenges, with its broad spread of activities

across the sector continuing to produce

sustainable results, and we remain confident

about the Group’s prospects. Our strategy of a

combination of organic and acquisitive growth

will continue, aided by our strong balance sheet

and record of successful business acquisitions.

Jim McCarthy

Chairman

20 January 2015

Strong balance

sheet and record

of successful

business

acquisitions


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Datganiad y Cadeirydd

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Amrywiaeth

o weithgareddau

yn cydbwyso

ansefydlogrwydd

Trosolwg

Mae Wynnstay wedi perfformio’n dda yn

ystod y flwyddyn, gan gynyddu elw, a llwyddo

i integreiddio caffaeliadau diweddar gan

gynorthwyo ehangiad ein Hisadran Manwerthu

Arebnigol. Mae’r amodau hinsoddol amrywiol a

gafwyd dros y blynyddoedd diwethaf wedi creu

ansefydlogrwydd yn y farchnad amaethyddol. Mae

hyn wedi bod yn amlwg mewn gwahaniaethau

sylweddol ym meintiau’r allbynnau amaethyddol,

gan arwain at ostyngiad mewn prisiau nwyddau

dros y deuddeg mis diwethaf.

Mae amrywiaeth o weithgareddau amaethyddol

Wynnstay yn helpu i gydbwyso effaith yr

ansefydlogrwydd o fewn ei farchnadoedd. Mae

budd gweithgareddau traws-sector Wynnstay

wedi bod yn hynod o amlwg yn y flwyddyn dan

sylw, a welodd symud mewn incwm rhwng dwy

hanner y flwyddyn ariannol ac, yn wir, o fewn

sectorau gwahanol y Grwp.

Cynyddodd elw cyn treth cyffredinol y Grwp i

£8.60m o flwyddyn i flwyddyn, sef y lefel uchaf

erioed. Roedd refeniw o £413.56m yn debyg

i’r flwyddyn flaenorol gan adlewyrchu ar y

cynnydd mewn gweithgareddau masnachu a

dadchwyddiant mewn prisiau ar draws y sector.

Roedd dadchwyddiant yn hynod o amlwg o

fewn yr Isadran Amaethyddiaeth lle gwelwyd

gostyngiad mewn refeniw o 4% i £308.71m, er y

cynnydd cyffredinol mewn meintiau masnachu.

Gostyngodd elw gweithredu i £3.80m, yn bennaf

o ganlyniad i bwysau ymylol ar fewnbynnau

amaethyddol a gweithgaredd y farchnad yn is

na’r disgwyl yng ngwerthiant gwrtaith a grawn

yn ystod ail hanner y flwyddyn. Dyma ostyniad a

effeithiodd ar y sector gyfan.

Perfformiodd ein Hisadran Manwerthu Arbenigol,

sy’n cynnwys siopau amaethyddol eu naws,

Wynnstay Stores, Just for Pets a Youngs Animal

Feeds, yn dda yn ystod y flwyddyn. Cynyddodd

refeniw 16% i £104.62m a hybwyd gan fusnes

Carmarthen & Pumsaint Farmers (“CPF”) a

gaffaelwyd ym mis Hydref 2013. Cynyddodd

elw gweithredu 10% i £4.88m. Mae Wynnstay

Stores bellach yn gweithredu o 42 o allfeydd, gan

greu cysylltiad hanfodol rhwng cwsmeriaid sy’n

ffermwyr a’n Hisadran Amaethyddiaeth.

Canlyniadau Ariannol

Roedd refeniw ar gyfer y flwyddyn hyd at 31 Hydref

2014 yn debyg i’r flwyddyn flaenorol o £413.56m

(2013: £413.48m). Cyfrannodd yr Isadran

Amaethyddiaeth £308.71m (2013: £323.00m) i’r

cyfanswm, gyda dadchwyddiant mewn prisiau

nwyddau yn effeithio ar y canlyniad yn sylweddol.

Cyfrannodd yr Isadran Manwerthu Arbenigol

£104.62m (2013: £90.19m), gyda chynnydd o

flwyddyn i flwyddyn yn cael ei lywio’n bennaf gan

gyfraniad blwyddyn lawn gyntaf o gaffael CPF, a

gwblhawyd ym mis Hydref 2013.

Roedd elw cyn treth y Grwp yn £8.60m (2013:

£8.46m cyn £0.35m o gostau eithriadol yn

ymwneud â chaffael CPF a £8.11m ar ôl costau

eithriadol). Dangosodd y cyfraniad elw gweithredu

o’r Isadran Amaethyddol, gan gynnwys mentrau ar

y cyd, ostyngiad o flwyddyn i flwyddyn o £3.80m

(2013: £4.90m). Roedd y gostyngiad hwn yn

adlewyrchu’n bennaf y pwysau o ran elw o alw is

yn y farchnad ar draws categorïau cynnyrch craidd.

Cyfrannodd yr Isadran Manwerthu Arbenigol,

gany gynnwys mentrau ar y cyd, elw gweithredu

o £4.88m (2013: £4.43), gyda chaffael CPF yn

perfformio’n well na’r disgwyliadau cychwynnol.

Gwnaeth gweithgareddau eraill elw gweithredu

o £0.25m (2013: colled o £0.39m) gan elwa ar

gyfraniadau mentrau ar y cyd gwell.

Cyfanswm y taliadau cyllid net oedd £0.33m

(2013: £0.48m) o ganlyniad i ddyled net gyfartalog

llai. Ar ôl tâl trethiant y Grwp o £1.90m (2013:

£1.94m), roedd enillion net, sef £6.70m (2013:

£6.17m), 8.5% yn uwch o flwyddyn i flwyddyn

Mae hyn yn cyfateb i 35.28c fesul cyfranddaliad

(2013: 36.43c). Roedd cynnydd yn nifer y

cyfranddaliadau a gyhoeddwyd yn y flwyddyn ar

ôl codi arian ym mis Medi 2013 er mwyn caffael

busnes CPF.

Roedd yr asedau net ar 31 Hydref 2014 8% yn

uwch ar £77.23m neu £4.07 fesul cyfranddaliad

(2013: £71.55m neu £4.22 fesul cyfranddaliad).

Roedd llif arian cryf wedi cynhyrchu sefyllfa arian

parod net o £2.75m ar ddiwedd y flwyddyn (2013:

dyled net o £2.49m), gyda dadchwyddiant mewn

nwyddau yn cyfrannu at sefyllfa cyfalaf gweithio

well a defnydd gwell o arian.

Roedd yr adenillion ar asedau net yn 11.3% (2013:

12.1%), gyda’r gostyngiad i’w briodoli’n bennaf i’r

cyfalaf ychwanegol a godwyd tuag at ddiwedd

y flwyddyn flaenorol wrth gaffael CPF, lle y mae

disgwyl manteision integreiddio pellach.

Ad-drefnu’r Grwp

Gwnaethom gwblhau ailstrwythuro’r Grwp cyn

dechrau masnachu ar gyfer y flwyddyn ariannol

2013/14 gan drosglwyddo’r gweithgareddau

masnachu presennol a gynhaliwyd drwy’r

Wynnstay Group Plc i’n his-gwmni masnachu,

Wynnstay (Agricultural Supplies) Cyfyngedig

a gafodd ei sefydlu’n gyntaf er mwyn i ni allu

caffael busnes CPF.

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Mae’r ad-drefnu mewnol hwn wedi creu cwmni

daliannol a chwe is-gwmni masnachu sy’n

cynnal gweithgarwch masnachol y busnes. O

ganlyniad, mae datganiadau ariannol y Cwmni yn

adlewyrchu’r ad-drefnu.

Difidend

Mae’n bleser gan y Bwrdd gynnig talu difidend

terfynol o 6.80c fesul cyfranddaliad (2013: 6.20c)

sy’n gynnydd o 9.7% o flwyddyn i flwyddyn.

Mae hyn, ynghyd â’r difidend interim o 3.40c

fesul cyfranddaliad, a dalwyd ar 31 Hydref 2014,

yn creu cyfanswm difidend o 10.20c ar gyfer y

flwyddyn, sy’n gynnydd o 9.7% o gymharu â’r

flwyddyn flaenorol (2013: 9.30c).

Caiff y difidend terfynol ei dalu ar 30 Ebrill

2015 i gyfranddalwyr sydd ar y gofrestr ar 27

Mawrth 2015. Yn amodol ar gymeradwyaeth

cyfranddalwyr, bydd difidend sgrip amgen ar gael

o hyd, fel yn y blynyddoedd blaenorol. Y dyddiad

olaf ar gyfer dewis cael difidend sgrip fydd 16

Ebrill 2015.

Y Bwrdd

Ym mis Gorffennaf 2014, roeddem yn falch

iawn o groesawu Howell Richards i’r Bwrdd fel

Cyfarwyddwr Anweithredol. Mae ganddo dros 30

mlynedd o brofiad yn y diwydiant amaethyddol

ynghyd â phrofiad ymarferol o heriau masnachol

y byd ffermio yn y DU heddiw, gan iddo sefydlu

un o’r ffermydd llaeth mwyaf yn y DU. Bydd ei

wybodaeth a’i arbenigedd o fudd i Wynnstay.

Ymddeolodd y Cyfarwyddwr Anweithredol, Jeff

Kendrick, o’r Grwp yng Nghyfarfod Cyffredinol

Blynyddol Wynnstay ym mis Mawrth 2014 a

hoffem ar ran y Bwrdd, ddiolch iddo unwaith

eto am ei gyfraniad aruthrol dros 25 mlynedd o

wasanaeth. Rydym hefyd yn cyhoeddi heddiw y

bydd yr Arglwydd Carlile yn ymddeol o’r Bwrdd

a’r Cwmni yng Nghyfarfod Cyffredinol Blynyddol

nesaf y Grwp. Mae’r Arglwydd Carlile wedi

ychwanegu gwerth sylweddol fel Cyfarwyddwr

Anweithredol am dros 16 blynedd ac mae ei

brofiad a’i gyngor doeth wedi bod o fudd mawr

i Wynnstay. Rydym yn bwriadu gwneud penodiad

Anweithredol arall maes o law.

Cydweithwyr

Mae holl gydweithwyr Wynnstay yn dangos

llawer o ymroddiad ac ymrwymiad i’r Grwp ac

i’n cwsmeriaid. Ar ran y Bwrdd, hoffwn ddatgan

ein gwerthfawrogiad a’n diolchgarwch; - mae

llwyddiant Wynnstay yn ganlyniad i waith caled,

brwdfrydedd ac ymroddiad pawb.

Rhagolwg

Mae’r rhagolygon hirdymor ar gyfer

amaethyddiaeth yn y DU yn parhau i fod yn

fywiog er y problemau tymor byr o ganlyniad

i’r gostyngiad ym mhrisiau cynnyrch. Mae’r

diwydiant yn parhau i fod yn fusnes cylchol, a

gaiff ei lywio gan yr hinsawdd yn bennaf, gyda

chyfnewidioldeb prisiau o ganlyniad i hynny. Tra

bod prisiau cynnyrch ar gyfer ein cwsmeriaid sy’n

ffermwyr yn wan ar hyn o bryd, yn enwedig ar gyfer

y diwydiant llaeth, dylai ffactorau economaidd

macro, gan gynnwys galw cynyddol am fwyd yn y

byd, arwain at ddychwelyd i brisiau mwy realistig.

Mae Wynnstay mewn lle da i gyflawni’r

sialensau tymor byr, gyda’i amrywiaeth eang

o weithgareddau ar draws y sector yn parhau i

gynhyrchu canlyniadau cynaliadwy, ac rydym yn

parhau i fod yn hyderus am ragolygon y Grwp. Y

bwriad yw parhau are ein strategaeth o gyfuniad o

dwf organig a thwf drwy gaffael, a gynorthwyir gan

ein mantolen gref a’n hanes o gaffael busnesau

llwyddiannus.

Jim McCarthy

Cadeirydd

20 Ionawr 2015

Mantolen gref

a’n hanes

o gaffael

busnesau

llwyddiannus

^

^

^

^


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Chief Executive’s Review

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Introduction

Wynnstay has demonstrated resilience in

a market which has seen a high degree of

volatility over the past two years. The Group’s

results are pleasing and in line with overall

management expectations, with a robust second

half contributing to a record annual profit before

tax of £8.60m. Whilst revenue of £413.56m

is flat year-on-year, the trading backdrop was

markedly different to the comparable period last

year, with price deflation, falling output prices

and a significant variation in weather conditions,

particularly between the two winter periods.

However the broad business base has once again

provided a buffer against the challenges arising

from the varied trading conditions during the year,

and we are gaining market share across a number

of sectors.

2014 was a year of both consolidation and

investment to support further organic growth.

In particular, we completed the integration of

recent acquisitions, including CPF purchased in

October 2013, which made its first and higher-

than-budgeted contribution to Group profitability

in the second half of the year.

While output prices for our farmer customers

remain a concern for the sector in the short

term, long term prospects remain strong with the

anticipated increase in demand continuing to be

a feature of the well-accepted macro factors.

Review of Activities

Agriculture

The Agricultural Division generated £308.71m of

revenue, a 4.4% decrease year-on-year, reflecting

a change in product mix and price deflation.

Operating profits reduced to £3.80m after two

years of strong results (2013: £4.90m). This

reduction resulted from margin pressure across

the Division’s raw material, fertiliser and seed

activities which was experienced throughout

the year. More broadly, results for the year

also reflected the mild weather conditions of

the winter, which contrasted significantly to

those experienced in the prior year, as well as

the subdued market conditions for agricultural

outputs which affected trading activity in the

second half of the year. A return to more normal

weather patterns after the winter benefited crop

production, resulting in good grazing and forage

production for livestock farmers as well as high

yields for many arable units.

Feed Products

The business manufactures feed for the poultry

and ruminant markets, and trades raw materials

within the sector. Our broad spread of feed

activities minimises the risk of exposure to any

specific market segment and acts as a buffer

against market volatility.

Demand for ruminant feed has been lower this

year against the prior year, mainly due to the

mild weather in the winter and spring, and lower

milk prices reduced demand from dairy farmers.

However, whilst overall feed volumes for the year

reduced by 2%, sales in the second half were

strong, showing an increase over the equivalent

period in 2013. There was a notable rise in sales

of blended products which offset reduced sheep

feed volumes in early spring. Our investment in

production facilities has enabled efficiencies

to be gained during the year contributing to an

improved performance in manufactured feeds.

Glasson

Operating its own port facilities at Glasson

Dock, near Lancaster, the Glasson business

is a long standing supplier of raw materials

Resilience

in a volatile

market


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to the agricultural wholesale market. It also

manufactures specialist products for wholesale

merchants and processes fertiliser for both direct

sale and to the wholesale sector. After two years

of outperformance, this year’s contribution from

Glasson was below the level of both prior years.

This reflected reduced margins across both

Glasson’s raw materials trading and fertiliser

activities. Volumes in raw materials however

were buoyant as feed manufacturers sourced

alternative raw materials to replace UK grain

which was in short supply following the poor

2013 harvest. Fertiliser sales increased during

the year within the Glasson and the FertLink joint

venture business although sales in the latter

part of the year were lower as farmers held back

from buying for the 2015 cropping year. Demand

for specialist products remains strong and the

business continues to develop within this market.

Arable Products

The arable division has developed well over

recent years despite the poor weather conditions

in 2012 and 2013. The Group is recognised as one

of the major seed processors in the UK, and sales

of cereal and herbage seed over the year reached

record levels, reflecting high volumes in the

autumn. However, margins came under pressure,

largely as a result of the reduction in grain prices

across the industry.

Fertiliser sales in the arable division increased by

19% year-on-year, incrementally benefiting from

CPF’s first full year’s contribution. Demand was

buoyant in the spring as farmers embraced ideal

growing conditions but tempered in the autumn,

with reduced margins, reflecting the pattern

experienced by our Glasson business.

The UK grain harvest has been good in 2014

reaching the expectations previously indicated.

While this brings opportunity for the GrainLink

and Woodheads grain trading teams, the fall in

grain prices in the autumn to levels last seen in

2008 has meant that farmers have been reluctant

to sell. We therefore expect a high proportion of

the volume will be marketed during the 2015

financial year.

Specialist Retail

The Specialist Retail Division, which comprises

Wynnstay Stores, Just for Pets and Youngs

Animal Feeds, performed well during the year.

Total revenues increased by 16% to £104.62m,

with operating profit rising by 10% to £4.88m.

These results benefited from the first full year’s

contribution from CPF, with the business moving

into profitability in the second half as expected.

CPF’s network of stores in South West Wales

has now been fully integrated, strengthening

our offering in this region. Just for Pets has seen

pleasing like-for-like growth reflecting increased

activity within the chain.

Wynnstay Stores

The Wynnstay Stores chain of rural retail outlets,

which now has 42 stores, including seven CPF

outlets, provides a wide range of products for

farmers and rural dwellers.

The CPF stores were fully integrated during the

year and made a good contribution in the second

half. We also acquired Mansell Powell Supplies,

a small agricultural business operating from

Pontrilas in Herefordshire, and completed the

relocation of our Llanfair Caereinion store in

Mid Wales to a larger site, enabling us to offer

a broader range of products to farmers and other

local customers. Since the year end, we have

added two further stores. In November 2014, we

opened an outlet in Aberystwyth, an area not

fully serviced previously and, in January 2015,

acquired Ross Feed, a business selling a wide

range of agricultural and smallholder products

operating in Ross-on-Wye. This latest acquisition

takes our stores total to 42 and further extends

our geographic reach, in line with our strategic

plans for the business.

Total stores revenues, including CPF stores,

increased by 25% over the prior year. On a like-

for-like basis, sales increased by 2% excluding

adjustment for deflation in feed products. This

result is particularly pleasing given the strong

performance in the previous year which benefited

from the very high feed demand during the

extended winter period.

As we focus on the requirements of farmers,

the retail team continues to investigate new

products which can aid farmer efficiency. The new

products we have introduced include large-scale

ventilation and lighting systems for dairy units,

and we have also further extended the range

of our agricultural hardware products. Our new

product initiatives have been well received and

contributed to the stores’ performance this year.

Our focus on innovation continues and the Group

is launching a comprehensive Dairy Catalogue

containing over 3,000 products for the dairy

industry. Both the expansion of our product range

Total stores

revenues,

including

CPF stores,

increased by

25%


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Chief Executive’s Review (continued)

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and this new dairy initiative will support our long

term strategy to expand into new geographic

trading areas as well as increase our penetration

within our existing regions.

Just for Pets

Just for Pets, our chain of pet product outlets,

has seen the benefit of the marketing initiatives

implemented over the past two years as consumer

sentiment has improved. Average spend increased

over the period, contributing to a 4.5% increase in

like-for-like sales for the year. Sales at our Yardley

outlet benefited from our decision to transfer the

trade from the Acocks Green store since both

operated within a similar retail catchment area.

Just for Pets focuses strongly on customer service

and has received many awards recognising the

quality of the staff and outlets in the Just for Pets

chain. The number of outlets currently stands at

20 stores and we expect to open an additional

outlet in the spring of 2015.

Youngs Animal Feeds

Youngs manufactures and distributes a range

of equine products for distribution by specialist

outlets across the centre of the UK. The business

has performed well, maintaining its position in

the market.

Joint Ventures and Associates

The Group benefits from the contribution of

an associate business, Wynnstay Fuels, and a

number of joint venture businesses, including

Bibby Agriculture, Wyro, GeoGen, FertLink and

Total Angling. All businesses have performed in

line with management expectations and continue

to make a valuable contribution to the Group.

Staff

I would like to take this opportunity to recognise

the commitment of all our staff to the continued

development of the Group. Wynnstay’s success is

based on the hard work, dedication and skills of

all staff and I would like to record my personal

appreciation and thanks.

I would also like to add my thanks both to Jeff

Kendrick who retired from the Group in 2014

and to Lord Carlile who will be retiring at the

forthcoming AGM. At the same time, I am

delighted to welcome Howell Richards who

joined Wynnstay as a Non-executive Director in

July 2014.

Global food

demand should

drive a return

to more

acceptable

prices


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Outlook

Output prices for our farmer customers have

changed significantly over the last year and

remain a concern especially for the dairy sector.

This, combined with the reform changes to the

Common Agricultural Policy, will bring further

changes to the agricultural industry including

some short term challenges. However, the macro

economic factors remain compelling as we see

continued growth in world demand for food and

energy, which should allow output prices to return

to a more acceptable level, bringing renewed

vigour to the sector.

The broad base to the Group gives a degree of

resilience during the more challenging times and

the business is well placed to offer the products

and services required for an efficient agricultural

industry. In line with our strategic plans for growth,

we will be investing in our IT and management

systems over the coming year to support the

Group’s continuing development. Overall the

agricultural sector remains strong and the Group’s

broad spread of activities forms a solid foundation

for continued development of the business and

sustainable returns for all stakeholders.

I look forward to providing an update on trading

at Wynnstay’s AGM in March. For those able to

attend our AGM please be aware that we have a

new venue for 2015, Lion Quays Hotel and Spa,

Weston Rhyn, Oswestry, Shropshire, SY11 3EN.

Ken Greetham

Chief Executive

20 January 2015


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Finance Review

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Group pre-tax

profit, which

includes the

Groups share of

pre-tax profits

from joint

ventures and

associate

investments

was £8.60m

Finance Review

Group Structure

Last year we announced that the Group had

established a new subsidiary, Wynnstay

(Agricultural Supplies) Limited, which was used

as the acquisition vehicle for the Carmarthen

& Pumsaint Farmers (“CPF”) transaction on the

1 October 2013. Prior to the commencement

of trading of the 2013/14 financial year, the

existing trading activities previously conducted

through Wynnstay Group Plc were “hived down”

into this new trading subsidiary, so that all similar

business was then conducted within the same

trading entity. This left the Group with a more

typical corporate structure of a holding Company,

Wynnstay Group Plc, which has investments in six

wholly owned trading subsidiaries, namely;

• Wynnstay (Agricultural Supplies) Limited, an

agricultural merchant.

• Glasson Grain Limited, a feed and fertiliser

merchant.

• GrainLink Limited, a grain merchant.

• Woodheads Seeds Limited, a seed and grain

merchant.

• Just for Pets Limited, a pet products retailer.

• Youngs Animal Feeds Limited, an equine

and pet products distributor.

Additionally Wynnstay Group Plc holds

investments in the principal joint ventures and

the associate Company outlined in Note 17 in

the accounts, and certain other property and

investment assets.

This change will be noted in the Company results

of the attached financial statements, which now

reflects this new role as a holding entity rather

than a trading company.

Trading Results

The financial performance of the business over

the last year has been impacted by significant

factors outside the control of the Group including;

commodity price volatility, a mild and shortened

winter, and reducing farm incomes particularly

from falling milk and grain prices. Whilst these

factors have acted to reduce revenue and

profitability in our Agriculture Division, previous

acquisition and development activity in our

Specialist Retail and other operations have

balanced the negative factors to allow the overall

business to once again report record results in

terms of Group pre-tax profitability.

Group revenue was £413.56m (2013: £413.48m),

of which £308.71m (2013: £323.00m) came

from Agriculture, which experienced generally

lower selling prices across the year as a result of

commodity price deflation. Average manufactured

feed prices, for example were some £14 per tonne

lower across the year, while fertiliser and grain

prices averaged falls of £22 and £46 per tonne

respectively. Our Specialist Retail operations

produced revenue of £104.62m (2013: £90.19m),

with most of the increase relating to a full year

contribution from the CPF acquisition. However

both retail chains also experienced like for like

sales growth, with 2.0% achieved in the Country

Stores and 4.5% at Just for Pets Limited.

The Group pre-tax profit, which includes the

Group’s share of pre-tax profits from joint ventures

and associate investments, was £8.60m (2013:

£8.46m prior to £0.35m of exceptional costs

relating to the CPF acquisition and £8.11m after

exceptional costs). Net finance charges amounted

to £0.33m (2013: £0.48m), which resulted in

Group operating profit, inclusive of joint venture

and associate contributions, of £8.93m (2013:

£8.94m excluding exceptional item and £8.59m

after exceptional item). Of this total, Agriculture

Division contributed £3.80m (2013: £4.90m) and

the Specialist Retail operations £4.87m (2013:

£4.43m). Other activities, which includes the

charge for Group share based payment costs,

contributed a profit of £0.25m (2013: loss of

£0.39m), primarily as a result of improved joint

venture income.

Group Earnings before Interest, Tax, Depreciation

and Amortisation (EBITDA) was £11.37m (2013:

£11.51m before exceptional costs), and was made

up as follows:

£millions 2014 2013

Profit before taxation 8.49 8.02

Share of tax incurred by joint ventures 0.10 0.09

Interest 0.33 0.48

Depreciation and freehold land impairment 2.51 2.52

Intangible amortisation 0.01 -

Profit on disposal of fixed assets (0.17) (0.13)

Share-based payments 0.10 0.18

Exceptional costs - 0.35

EBITDA 11.37 11.51


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Taxation

The Group’s tax charge of £1.90m (2013: £1.94m)

represented 22.1% (2013: 23.9%) of the Group

pre-tax profit, and again has benefited from the

reduction in general corporation tax rates and

the related reduction in deferred tax provisions.

However it remained above the pro-rata standard

rate for the period of 21.8% (2013: 23.4%)

primarily as a result of certain cost items not

being deductible for tax purposes. Actual tax

cash payments in the year were £2.27m, (2013:

£2.04m) which included accelerated instalment

payments at Glasson Grain, and initial quarterly

payments on account of the current year for the

new trading subsidiary Wynnstay (Agricultural

Supplies) Limited.

Earnings Per Share and Dividend

Basic earnings per share were 35.28p (2013:

36.43p), based on a weighted average number of

shares in issue during the year of 18.981m (2013:

16.941m). The Board proposes to recommend the

payment of a final dividend of 6.80p per share to

be paid on the 30 April 2015, which when added

to the interim dividend of 3.40p per share paid

on the 31 October 2014, makes a total of 10.20p

for the year (2013: 9.30p), an increase of 9.7%.

The total dividend is expected to be covered

3.44 times (2013: 3.65 times) by earnings, and

represents the seventh consecutive year that the

Board has been able to raise the dividend by over

8%.

Share Capital

During the year a total of 258,252 (2013:

2,108,136) new ordinary shares were issued for a

total equivalent cash amount of £0.711m (2013:

£9.836m). A total of 195,282 (2013: 357,406)

shares were issued in relation to the exercise of

employee share options for a total consideration

of £0.321m (2013: £0.801m). The remaining

62,970 (2013: 68,488) shares were issued to

existing shareholders exercising their right to

receive dividends in the form of new shares

under the Company’s scrip dividend scheme for

a total equivalent cash value of £0.390m (2013:

£0.333m). No other shares were issued during the

year. During the previous financial year there was

a private institutional placing of new shares in

which 1,682,242 shares were issued at a price of

£5.35 per share, raising a net of expenses total

of £8.702m. These funds were primarily used to

fund the acquisition of the CPF business, with

the surplus being applied for general corporate

purposes.

Balance Sheet

Group net assets, inclusive of goodwill, at the

year end amounted to £77.23m (2013: £71.55m).

Based on the weighted average number of shares

in issue during the year of 18.981m, (2013:

16.941m) this represented a net asset value per

share of £4.07 (2013: £4.22). During the financial

year the share price traded in a range between a

low of £5.44 in October 2014 and a high of £6.81

in March 2014.

Capital investment in fixed assets amounted

to £3.06m (2013: £3.02m) and £0.20m (2013:

£nil) was invested in goodwill when the Group

acquired the trade of Mansell Powell Supplies in

Pontrilas. Additionally a further small amount of

£0.09m (2013: £0.13m) was invested during the

year to enhance the Pwllheli development which

continues to be marketed as an investment sale.

Lower commodity prices, which restricted revenue

growth, had a beneficial impact on working

capital utilisation during the year, and as at the

year end, enabled lower levels of inventories and

trade receivables to be reported. This was partially

offset by lower trade payables, but still resulted in

an improvement in Net Working Capital, which is

defined as, the net of inventory, trade and other

receivables and trade and other payables, which

at the year end was £31.1m (2013: £31.8m).

Net asset

value per

share of

£4.07


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Finance Review (continued)

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Cashflow, Net Cash and Banking Facilities

Continued cash generation from trading,

together with the working capital improvement

mentioned above, has again produced another

year of strong positive cashflow from operating

activities, which was £9.18m (2013: £10.44m).

Total net cash investment, excluding assets

acquired under finance leases amounted to

£2.22m (2013: £6.38m, including acquisitions).

New equity finance, primarily this year from

scrip dividends and employee options, was raised

of £0.71m (2013: £9.84m). After the payment

of £1.82m (2013: £1.47m) in dividends to

shareholders, term debt repayments of £2.85m

(2013: £2.54m), and new loans drawn of £0.27m

(2013: £0.90m) there was a net increase in cash

and cash equivalents in the business of £3.27m

(2013: £10.79m increase). When added to the net

reduction in term and other existing non liquid

debts of £2.24m (2013: £1.41m) and accounting

for the new loan of £0.27m (2013: £0.90m) a

total positive movement in funding in the year

of £5.24m (2013: £11.30m) was achieved. This

resulted in the net debt position at the beginning

of the year of £2.49m being converted into a net

cash position of £2.75m at the year end.

However this strong cash position at the year end

should be noted as representing the traditional

seasonal trough of the Group’s working capital

cycle, and as the business moves into the more

usual heavy trading patterns of the winter and

spring, short term borrowings will again be

required to finance peak trading activities. The

Board continues to prioritise the maintenance

of adequate banking facilities to accommodate

unexpected commodity price volatility. Continued

strong support from the Group’s primary bankers,

HSBC, has enabled new facilities, on improved

terms, to be offered and we expect these to be

in place for use from April 2015, and which will

include a significant proportion on a committed

term basis. The Board believes projected

overall debt will remain well within these new

arrangements, which will replace all existing

working capital facilities, which currently amount

to £18.5m.

Key Performance Indicators and Risk

Management

Details of Key Performance Indicators and the

risks and uncertainties for the business are given

in the Strategic Report on page 17.

Paul Roberts

Finance Director

20 January 2015

A total

positive

movement in

funding in the

year of £5.24m

resulted in the

net debt position

at the beginning

of the year of

£2.49m being

converted into

a net cash

position of

£2.75m at the

year end


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Key Performance Indicators and Risk Management

Key Performance Indicators

The performance of the business is regularly monitored against Key Performance Indicators (KPI’s), (the results for which are reported in the Chairman’s Statement on page 6 and 7. These indicators are defined as follows:

Revenue: The invoiced value of sales from the Group’s activities, measured at a fair value net of all rebates and excluding value added tax.

EBITDA: Group pre-tax profit, including share of pre-tax profits of joint ventures and associates and profit on fixed asset disposals, before interest, taxation, depreciation, fixed asset impairment charges and share based payments.

Earnings per Share: Profit for the year after taxation divided by the weighted average number of shares in issue during the year excluding any shares held by the Group’s Employee Share Ownership Trust.

Return on Net Assets: Group pre-tax profit, including share of pre-tax profits of joint ventures and associates before intangible and amortisation, share-based payment charges or exceptional costs, divided by the balance sheet net asset value.

Net Asset per Share: The balance sheet net asset value, divided by the weighted average number of shares in issue during the year, excluding any shares held by the Group’s Employee Share Ownership Trust.

Risk Management

Risks and uncertainties for the business are classified into two main categories, Financial and Operational. The Board monitor such risks and have developed policies for managing the uncertainties they bring. The main elements of these controls operate in the following areas:

Financial Risk Management:

The Group policies for managing treasury risks are developed and approved by the Board and are designed to minimise exposure to market volatility. They include:

Interest Rate – While currently most of the Group’s term debt is floating base rate linked, the Board constantly reviews its option to fix the rates attached to this debt through the use of interest rate swap derivatives. Fixed rate term finance is used for the acquisition of vehicles.

Foreign Currency – The main currency related risk to the Group arises from the forward purchasing of imported raw materials for our Glasson business. This risk is mainly managed by entering into currency purchase agreements at the time the underlying transaction is completed. The fair value of these contracts is not material. As at the year end the principal amounts relating to forward purchased currency amounted to £3,655,694 (2013: £2,281,000).

Commodity Price - While the Group does not engage in the taking of speculative commodity positions, it does have to make significant forward

purchases of certain raw materials, particularly for use in its animal feed manufacturing activities. Position reporting systems are in place to ensure the Board is appraised of the exposure level on a regular basis, and where possible hedging tools, primarily wheat futures contracts on the London LIFFE market, are used to manage price decisions.

Credit – A significant proportion of the Group’s trade is conducted on credit terms and as such a risk of non payment is always present. Detailed systems of credit approval before initial supply, the operation of credit limits and an active credit control policy act to minimise this risk and historically the incidence of bad debts is low. The grain trading business has exposed the Group to certain substantial customer credit balances, and to assist in mitigating this perceived risk, a credit insurance policy has been purchased to provide partial cover against default by certain customers.

Finance Availability – The banking crisis of recent years and fluctuating commodity prices, which can adversely impact working capital levels, demonstrate the need to ensure that adequate financial resources are available to accommodate unexpected, but foreseeable, trading patterns and conditions. The Group has historically operated with banking facilities that provide healthy headroom above the anticipated maximum requirement as projected in working capital cycle forecasts. Whilst this remains the case, the Group is currently negotiating new banking arrangements that also include a significant element of committed facilities over a five year period.

Internal Controls – As the Group operates across a number of different markets in both its Agriculture and Specialist Retail segments, strong internal controls are required to ensure the business is not exposed to financial irregularities or losses that are not readily identifiable. Such controls include policies for the proper authorisation of the procurement of all products and services, and the sanctioning of expense expenditure and employment costs. These policies are principally controlled by the Management Boards of the operating subsidiaries of the Group, who meet on a regular and routine basis. The Group Chief Executive and Finance Director attend all these meetings and undertake business and financial reviews of subsidiary activity with particular attention paid to the monitoring of actual performance against budget.

Operational Risk Management:

Trading concerns are regularly reviewed in routine Management Board meetings of the operating subsidiaries of the Group, with conclusions reported to the Board. Existing identified risks include :

Customer Loss and Competition – There is a constant risk of customer loss from increasing competition in the agricultural sector as the industry continues to consolidate with certain participants growing significantly over the last twelve months. The Group continues to counter this risk by pursuing a sensible growth strategy to increase its market share primarily through

geographic expansion and acquisitions. The Group specifically seeks to maintain a broad spread of activities across the main agricultural input areas to minimise threats affecting any particular farming enterprise. Significant investment continues in the Company’s sales channels, both in terms of the traditional direct teams and new trading desk facilities.

Manufacturing Productivity – Much of the Group’s feed business is conducted on a customer “made to order” basis. This requires sophisticated order processing, manufacturing and delivery systems, as low lead times can provide a competitive advantage. The breakdown of any of these systems, through mechanical fault, weather and traffic disruption, or computer malfunctions and errors can create the risk of order fulfilment failure. The Group protects against this through the operation of multiple supply points, with third party manufacturing arrangements in place, and the back up of all IT systems supported with a disaster recovery plan. The increasing use of Customer Relationship Management (CRM) systems allow for higher levels of pre-emptive order processing encouraging customer retention.

Supply Chain Efficiency – The Group’s considerable inventories both in the retail businesses and as raw materials for the manufacturing activities are vital to the success of the organisation, and disruption to this supply would damage revenue streams. To minimise this risk, the Group operates partnership relationships with as many suppliers as possible which endeavour to ensure that optimum stock levels are maintained in Group warehouses, in wholesaler locations or within committed supplier facilities. A project team is currently working to optimise stock turn ratios while ensuring adequate availability through challenging seasonal cycles.

Reputation – The Group’s trading philosophy is to seek to be the “Supplier of Choice” to its customers. To achieve this, a reputation for quality products, service and value for money must be maintained. Through a comprehensive employee Information and Consultation policy, all members of staff and local management are tasked with enhancing the Group’s reputation in the eyes of customers and all other stakeholders of the business. The Group’s corporate plan is communicated to management at various levels within the business to facilitate a strong understanding of the ethos and culture necessary for continued success.

Fraud – More difficult general economic circumstances may increase the risk of fraud being perpetrated on the Group. The Board has recognised this increased risk, and continually reviews internal systems and controls, addressing areas of identified weaknesses including any matters raised as part of the Group audit process.

Our 2014 Strategic Report from pages 4 to 17 has been reviewed and approved by the Board of Directors on the 20 January 2015.

Paul Roberts Finance Director


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Advisers

DIRECTORS J J McCarthy

J C Kendrick (retired 18 March 2014)

Lord Carlile CBE QC

B P Roberts

K R Greetham

D A T Evans

P M Kirkham

H J Richards (appointed 14 July 2014)

SECRETARY B P Roberts

COMPANY NUMBER 2704051

REGISTERED OFFICE Eagle House

Llansantffraid-ym-Mechain

Powys

SY22 6AQ

AUDITOR KPMG LLP

8 Princes Parade

Liverpool

L3 1QH

PRINCIPAL BANKERS HSBC Plc

Corporate Banking Centre

3 Rivergate

Bristol

BS1 6ER

NOMINATED ADVISOR &

STOCKBROKER Shore Capital Limited

Bond Street House

11 Clifford Street

London

W1S 4JU

REGISTRARS Neville Registrars Limited

Neville House

18 Laurel Lane

Halesowen

West Midlands

B63 3DA

SOLICITORS Harrisons Solicitors LLP DWF LLP

11 Berriew Street 5 St Paul’s Square

Welshpool Liverpool

Powys L3 9AE

SY21 7SL

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Board of Directors

James John McCarthy

(age 59)

Chairman

Jim joined the Board in July 2011

and was appointed chairman of

the Group in November 2013.

He has a wealth of corporate and

management experience from

a background in the retailing

industry which spans over 38

years. He is currently Chief

Executive Officer of Poundland

Limited.

Lord Carlile CBE QC

(age 66)

Vice-Chairman

Lord Carlile joined the Board

in 1998 following a period as

Chairman of the Company’s

Special Share Trust while he was

MP for Montgomeryshire. He

currently also acts as a Deputy

High Court Judge and is an active

member of the House of Lords

Philip Michael Kirkham

(age 57)

Senior Independent

Non-Executive Director

Philip joined the Board in April

2013. He runs a mixed farming

business in the West Midlands and

also has significant experience in

the UK livestock sector. He is non-

executive chairman of National

Milk Records Plc and a director of

Meadow Quality Ltd.

Bryan Paul Roberts

(age 51)

Finance Director

Paul joined the Board in 1997

when he also became Company

Secretary. He originally joined

the Company in 1987 having

previously worked in the animal

feed industry. He is a fellow

of the Chartered Institute of

Management Accountants.

Howell John Richards

(age 50)


Howell joined the Board in

July 2014. He has significant

experience within the

agricultural supply industry and

has established a large dairy

enterprise in South Wales. As

a member of a number of well

recognised committees Howell

promotes the UK dairy industry

and supports initiatives for young

entrants into UK farming.

Kenneth Richard Greetham

(age 55)

Chief Executive

Ken joined the Board in 2008

when he became Chief Executive.

He joined Wynnstay in 1997

following the integration of

Shropshire Grain and was

responsible for the development

of the Group’s arable activities.

David Andrew Thomas Evans

(age 46)

Retail Director

Andrew joined the Board in 2008

and has executive responsibility

for all the Group’s retail activities.

He is also a dairy farmer in Mid

Wales.


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Directors’ Report for the year ended 31 October 2014

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The Directors present their report together with

the audited financial statements of the Parent

Company (“the Company”) and the Group for the

year ended 31 October 2014.

Wynnstay Group Plc (“the Company”) is a public

limited company incorporated and domiciled in

the United Kingdom under the Companies Act

2006.

The address of the Company’s registered office is

Wynnstay Group Plc, Eagle House, Llansantffraid-

Ym-Mechain, Powys, SY22 6AQ.

The Company has its primary listing on AIM, part

of the London Stock Exchange.

The Group financial statements were authorised

for issue by the Board of Directors on 20 January

2015.

Further information on the activities of the

business and the Group strategy are presented

in the Chairman’s Statement, Chief Executive’s

Review, Strategic Report and Corporate

Governance Report included within the Group’s

full published Annual Report.

Share Capital

The movement in the share capital during the

period is detailed in note 28 to the financial

statements.

Results, Dividends and Transfers to Reserves

Reported under IFRS the Group profit before

taxation is £8,493,000 (2013: £8,021,000). After a

taxation charge of £1,796,000 (2013: £1,850,000),

the Group profit for the year is £6,697,000 (2013:

£6,171,000).

The Directors recommend a final ordinary dividend

of 6.80p per ordinary 25p share net (2013: 6.20p per

ordinary 25p share net), to be paid on 30 April 2015,

to shareholders on the register at the close of

business on 27 March 2015.

The share price will be marked ex dividend with

effect from the 26 March 2015. In accordance

with the rules of the Company’s Scrip Dividend

Scheme, eligible shareholders will be entitled to

receive their dividend in the form of additional

shares. New mandate forms for this scheme

should be signed and lodged with the Company

Secretary 14 days before the dividend payment

date of 30 April 2015.

Land and Buildings

In the opinion of the Directors, the current open

market value of the Group’s interest in land

and buildings exceeds the book value at 31

October 2014 (refer to note 15) by approximately

£3,980,000 (2013: £3,705,000).

25p Ordinary Shares SAYE Option Discretionary Options

2014 2013 2014 2013 2014 2013

J J McCarthy - - - - - -

J C Kendrick (retired 18 March 2014) n/a 10,375 n/a - n/a -

Lord Carlile CBE QC 33,421 32,909 - - - -

B P Roberts 102,719 105,219 5,335 4,150 31,000 44,500

K R Greetham 42,725 39,969 3,784 1,413 31,000 62,000

D A T Evans 19,260 18,965 2,371 - 26,000 35,500

P M Kirkham - - - - - -

H J Richards (appointed 14 July 2014) - n/a - n/a - n/a

Directors and their interests

The Directors of the company who held office during the year and their interests in the share capital of the Company at the year end were as follows:

In addition to the above shareholdings, Mr B P Roberts and Mr K R Greetham are trustees of the Company’s Employee Share Ownership Plan trust, which at

the year end held 10,494 shares (2013: nil shares).

Accordingly these directors were deemed to hold an additional non-beneficial holding in such shares.

No Director at the year end held any interest in any subsidiary or associate Company. Mr J C Kendrick (retired 18 March 2014) held an interest in Morrey

Oils Limited, the controlling shareholder in Wynnstay Fuels Limited, an associate of the Group. Biographical details of the Directors are set out before the

Directors’ report.

Directors’ Appointments and Retirements

Under Article 91, Mr J J McCarthy and Mr B P

Roberts retire from the Board by rotation at the

forthcoming Annual General Meeting and, being

eligible, offer themselves for re election. Having

been appointed during the year, Mr H J Richards

retires under Article 86, and, being eligible, offers

himself for re-election. Lord Carlile will retire

from the Board after the Annual General Meeting

having reached the Board’s agreed retirement

age.

Directors’ and Officers’ Liability Insurance

During the year the Company purchased and

maintained liability insurance for its Directors

and Officers which remained in force at the date

of this report.

Employees

The Group has procedures for keeping its

employees informed about the progress of the

business. The Group continues to encourage

employee motivation by operating a Savings

Related Share Option Scheme open to all

employees. The Group provides training and

support for all employees where appropriate, and

gives a full and fair consideration to disabled

applicants in respect of duties which may be

effectively performed by a disabled person. Where

existing employees become disabled, the Group

will seek to continue employing them, bearing

in mind their disability and provided suitable

duties are available. Failing this, all attempts

will be made to provide a continuing income.

Health and safety matters are a high priority issue


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Substantial Shareholdings

At 31 October 2014, the following shareholders held 3% or more of the issued share capital of the Company:

Registered Shareholder Beneficial Holder

Ferlim Nominees Limited 8.1% Discretionary managed funds of Investec Wealth & Investment Limited

Chase Nominees Limited 7.7% Schroder Investment Management Limited

Europe Nominees Limited 5.3% Polar Capital

Vidacos Nominees Limited 3.4% Discretionary managed funds of Brown Shipley Private Bank

The Directors are not aware of any other person, Company or Group of Companies that held 3% or more of the issued share capital of the Company.

for the Board, who consider a monthly report on

developments and any incidents that may have

occurred, including accidents and near misses.

Policy for Payment of Creditors

The Group agrees terms and conditions with

suppliers before business takes place and, while

there is no Group code or standard it is not Group

policy to extend supplier payment terms beyond

that agreed. There are no suppliers subject to

special arrangements. The average credit terms

for the Group as a whole based on the year end

trade payables figure and a 365 day year is 42

days (2013: 42 days).

Auditor Reappointment

Pursuant to section 487 of the Companies Act

2006, a resolution proposing the reappointment

of KPMG LLP will be submitted to the Annual

General Meeting on 24 March 2015.

Disclosure of Information to Auditor

The Directors who were members of the Board at

the time of approving the Directors’ Report are

listed on page 19. Having made enquires of fellow

Directors each of these Directors, at the date of

this report, confirms that:

• to the best of each Director’s knowledge and

belief, there is no relevant audit information

of which the Group’s auditor is unaware;

and

• each Director has taken all the steps a

Director might reasonably be expected to

have taken to be aware of relevant audit

information and to establish that the

Group’s auditor is aware of that information.

This confirmation is given and should be

interpreted in accordance with the provisions of

s418 of the Companies Act 2006.

Statement of Directors’ Responsibilities in Respect of the Annual Report and Accounts, Strategic Report and Directors’ Report and the Financial Statements

The Directors are responsible for preparing the

Annual Report and Accounts, Strategic Report and

Directors’ Report and the financial statements in

accordance with applicable law and regulations.

Company law requires the Directors to prepare

Group and Parent Company financial statements

for each financial year. Under that law they have

elected to prepare both the Group and the Parent

Company financial statements in accordance with

IFRSs as adopted by the EU and applicable law. As

required by the AIM Rules of the London Stock

Exchange they are required to prepare the Group

financial statements in accordance with IFRSs as

adopted by the EU and applicable law and have

elected to prepare the Parent Company financial

statements on the same basis.

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 Parent Company

and of their profit or loss for that period. In

preparing each of the Group and Parent Company

financial statements, the Directors are required

to:

• select suitable accounting policies and then

apply them consistently;

• make judgments and estimates that are

reasonable and prudent;

• state whether they have been prepared in

accordance with IFRSs as adopted by the

EU; and

• prepare the financial statements on the

going concern basis unless it is inappropriate

to presume that the Group and the Parent

Company will continue in business.

The Directors are responsible for keeping adequate

accounting records that are sufficient to show and

explain the Parent Company’s transactions and

disclose with reasonable accuracy at any time

the financial position of the Parent Company

and enable them to ensure that the financial

statements comply with the Companies Act 2006.

They have general responsibility for taking such

steps as are reasonably open to them to safeguard

the assets of the Group and to prevent and detect

fraud and other irregularities.

Under applicable law and regulations, the Directors

are also responsible for preparing a Directors’

Report, Corporate Governance Statement and

Directors’ Remuneration Statement that complies

with that law and those regulations.

The Directors are responsible for the maintenance

and integrity of the corporate and financial

information included on the Company’s website.

Legislation in the United Kingdom governing

the preparation and dissemination of financial

statements may differ from legislation in other

jurisdictions.

By order of the Board

Paul Roberts

Finance Director

20 January 2015


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Corporate Governance Statement for the year ended 31 October 2014

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The Principles of Good Governance

The Board is committed to high standards

of corporate governance. The adoption and

maintenance of good governance is the

responsibility of the Board as a whole, who

have considered the twelve principles of

good practice published in the QCA Corporate

Governance Guidelines for Smaller Companies

updated in 2013. The Board believes that it has

incorporated these principles in formulating a

Corporate Governance policy appropriate to the

size of the Group, and which can provide comfort

for the Company’s numerous and widespread

shareholder base who have the right to expect the

highest possible level of standards. The Directors

are pleased to provide the following information:

The Board of Directors

The Board currently comprises seven directors,

three of whom are executive and four non-

executives. The roles of Chairman and Chief

Executive are separated. The Chairman is non-

executive and is elected by the whole Board on

an annual basis, with Mr J J McCarthy originally

being appointed to this role in November 2013.

The executive directors all have considerable

experience in the agricultural supply industry and

have spent much of their careers with the Group,

providing a significant degree of management

continuity. The non-executives bring a range of

business and commercial expertise to the Board,

including direct agriculture, specialist retail, legal

and political skills. Mr P M Kirkham, having been

appointed in April 2013 is deemed the Senior

independent non-executive, and Lord Carlile,

CBE QC, although having served on the Board

for longer than the code recommended period of

nine years, is still deemed independent through

the integrity provided from his other roles, which

amongst other activities include acting as a

circuit judge and a government advisor on various

sensitive matters. Following the retirement of

Mr J C Kendrick in March 2014, Mr H J

Richards joined the Board in July 2014 further

strengthening the agricultural trading knowledge

and independence of the Board. The Chairman is

responsible for the periodic performance reviews

of the Board sub-committees and non-executive

directors, and has concluded that the correct

balance of skills and experience is in place for the

effective stewardship of the business. A formal

schedule of matters requiring Board approval

is maintained, and covers such areas as Group

strategy, approval of financial budgets and results,

Board appointments, approval of major capital

expenditure and dividend policy. The Board

normally meet once a month with additional

meetings as necessary. Directors are able, if

necessary, to take independent professional advice

in furtherance of their duties, at the Company’s

expense. All directors and some senior members

of staff have adopted a set of guidelines in regard

to their responsibilities for the management and

conduct of the Company. The Board believes that

this structure, together with the operation of its

sub-committees described below, satisfies the

flexible and effective management elements of

the QCA guidelines.

Board Committees

Audit Committee

This Committee consists of Mr P M Kirkham

(Committee Chairman), Lord Carlile CBE QC and

Mr J J McCarthy. The Committee meets at least

three times a year with additional meetings as

required. The Committee has standard terms of

reference which have been formally approved by

the Board, and which include the supervision of

the external audit process and the effectiveness

of the internal financial controls. The terms

of reference further task the Committee with

identifying and evaluating significant internal

and external risks faced by the Company, and

then making recommendations to the Board on

appropriate strategies for effectively managing

these risks. Such risks include:

• The reliability of internal and external

reporting systems;

• The safeguarding of assets from

inappropriate use, loss and fraud;

• Identifying and properly managing

liabilities; and

• Ensuring the business operates within all

applicable legislation and uses best practice

wherever possible.

The Audit Committee met three times during the

year and all committee members attended, with

the exception of Mr J J McCarthy at one meeting.

The Committee agreed the nature and scope of

the audit with the auditor and monitored their

findings. The Committee organise internal audit

assignments to test the operating effectiveness of

internal systems and controls. These assignments

are not completed by specific internal audit

employees, but appropriate members of staff. The

Committee has procedures in place to enable it

to meet with the auditor without the presence of

the Company’s management and it formulates

and oversees the Company policy on maintaining

auditor objectivity and independence in relation

to non audit services. The policy is to ensure that

the nature of the non audit services performed

or the fee income relative to the audit does

not compromise the auditors’ independence,

objectivity or integrity and complies with ethical

standards. Details of such services and fees are

provided in note 6 to the accounts.

Remuneration Committee

This Committee of the Board consists of

Mr J J McCarthy, Mr P M Kirkham and is chaired

by Lord Carlile CBE QC. The Committee meets

at least once a year and has standard terms of

reference in place which have been formally

approved by the Board. These terms of reference

include the formulation of remuneration policies

for executive directors and senior managers, and

the supervision of employee benefit structures

throughout the Company. The Remuneration

Committee met twice during the year and all

committee members attended with the exception

of Mr J J McCarthy at one meeting.

Nomination Committee

This Committee of the Board currently consists

of Mr J J McCarthy, Mr K R Greetham and is

chaired by Mr P M Kirkham. The Committee

meets at least once a year and has standard

terms of reference in place which have been

formally approved by the Board. The Committee

is tasked with reviewing the leadership needs of

the Company and making recommendations to

ensure the continuity of such leadership through

the identification, evaluation and appointment of

both executive and non-executive directors.

The Nomination Committee met four times during

the year and all committee members attended.

Relations with Shareholders

The Board recognises the importance of

communicating with its shareholders and

maintains dialogue with institutional shareholders

and analysts, and presentations are made when

financial results are announced. Lord Carlile

CBE QC is the nominated independent non-

executive Director who makes himself available

to shareholders who may require an independent

contact.

The Annual General Meeting is the principal

forum for dialogue with private shareholders who

are given the opportunity to raise questions at

the meeting. The Company aims to send out

notice of the Annual General meeting at least 21

working days before the meeting. Shareholders

also have access to the Company’s website at

www.wynnstay.co.uk.

Going Concern

The Directors have prepared the financial

statements on a going concern basis, having

satisfied themselves from a review of internal


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budgets and forecasts and current bank facilities

that the Group has adequate resources to continue

in operational existence for the foreseeable future.

Internal Control

The Board of Directors has overall responsibility

for the system of internal controls, including

financial, operational and compliance, operated

by the Group and for its effectiveness. Such

a system can only provide reasonable and

not absolute assurance against material

misstatement or loss, as it is designed to manage

rather than eliminate the failure to achieve

business objectives.

The key procedures within the control structure

include:

• Managers at all levels in the Group have

clear lines of reporting responsibility within

a clearly defined organisational structure;

• Comprehensive financial reporting

procedures exist with budgets covering

profits, cash flows and capital expenditure

being prepared and adopted by the Board

annually. Actual results are reported

monthly to the Board and results compared

with budgets and last year’s actual. Revised

forecasts are prepared as appropriate; and

• There is a structural process for appraising

and authorising capital projects with clearly

defined authorisation levels.

Corporate Social Responsibility

The Directors recognise the importance of

managing the business in a responsible, fair and

ethical manner, and strive to engender such values

in every aspect of the Group’s operations. Social,

environmental and sustainable considerations

are taken into account in the formulation of

polices in the following areas of activity:

Human resources – the relationship nature of

much of the Group’s trading activities makes it

heavily dependent on the quality and efficiency

of the personnel involved in the business.

People management and development is

therefore critical to the success of the Group, and

considerable effort and investment is put into

the recruitment, training, welfare and support of

all staff. The Group is committed to creating a

fair, enjoyable and fulfilling work environment

and has policies in place to create opportunity,

prevent discrimination, encourage engagement

and keep staff informed on aspects of the

business.

Health and safety – the Group takes the health

and safety of its staff, customers and everyone

else involved with the business very seriously. All

staff receive basic training and where individual

roles require, additional specialist support is

provided. Occupational health specialists are

utilised to screen employees who operate in

environments with an added risk of exposure

to noise, vibration or other hazards that may

cause harm. The Group and subsidiary Boards

routinely consider health and safety matters

and ensure adequate resources are in place to

enable all personnel to fulfil their obligations

in this regard. The Audit Committee considers

an annual report on safety, risk and compliance

management and will require appropriate action

be taken where areas of concern are identified.

Reportable injuries (Riddor) during the financial

year numbered two across the core Group, which

was a decrease on the previous year when there

were eight incidents.

Sustainability and limiting environmental

impact – the business seeks to operate

all activities in a sustainable manner, and

management are actively encouraged to consider

and minimise the environmental impact of their

operations. Energy usage is recorded across the

Group and reported centrally for monitoring, with

individual departments tasked with efficiency

improvement targets on a unit productivity

basis. A significant number of capital investment

projects to improve energy efficiency have been

completed in recent years, including solar power

generation, biomass boiler installations and

capacitor controlled electric motors in the feed

mills. Recycling processes operate across the

Group for plastics, paper, cardboard, metal, wood,

electrical equipment and used oils. Central

facilities are used for the collection of these

items from individual stores by the Group’s own

vehicle fleet following product deliveries. Fuel

efficiency is paramount in vehicle investment

decisions, and mileage management is a key

task for all fleet responsible personnel.

Supporting the community – playing an active

part in the communities in which it operates

is an important concept for the management

of the business. Support includes community

event sponsorship, charitable donations,

educational and other group visits, provision

of work experience, and assistance with time

and resource provision for social and charitable

initiatives. The Group also supports selected

research projects with local educational

establishments, and has recently assisted

with a piece of work at Aberystwyth University

into Campylobacter contamination in the UK

poultry industry. Each year the Company selects

specified charities and organisations to work

with, and has been pleased to support the

Royal Agriculture Benevolent Institution and

the National Federation of Young Farmers Clubs

in the current year. Additionally, customers at

Just for Pets Limited have raised funding for the

training of a fifth guide dog puppy during the

year, which will bring the total amount raised

over the last three years to over £30,000 for this

worthy cause.

Auditor Independence

The Board is satisfied that KPMG LLP has

adequate policies and safeguards in place to

ensure that auditor objectivity and independence

is maintained. The Group meets its obligations

for maintaining the appropriate relationship

with the external auditors through the Audit

Committee whose terms of reference include

an obligation to consider and keep under

review the degree of work undertaken by the

external auditor, other than the statutory audit,

to ensure such objectivity and independence is

safeguarded.

By order of the Board.

Paul Roberts

Secretary

20 January 2015


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Directors’ Remuneration Statement for the year ended 31 October 2014

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Introductory Statement

As a Company listed on the Alternative

Investment Market (“AIM”) of the London Stock

Exchange, the Company is exempt from the s420

obligation of the Companies Act 2006 to prepare

a Directors’ remuneration report, and the s439

obligation to put a written remuneration policy

to a shareholders vote once every three years.

However the Board believe that it should operate

to the highest corporate governance standards

appropriate to companies of its size and resource

availability. It is therefore pleased to provide the

following voluntary information, and to refer to

the details of the Directors’ remuneration received

during the year which can be found in Note 9 to

the Accounts which is provided in accordance

with AIM Rule 19. Details of Directors’ current

shareholdings are provided in the shareholding

section of the Directors’ report.

Board Remuneration Policy

All matters relating to remuneration of the

Directors of the Company are determined by the

Remuneration Committee whose decisions are

made with a view to achieving the broad objective

of rewarding individuals for the nature of their

work and the contribution they make towards the

Group achieving its strategic aims. Proper regard

is given to the need to attract and retain high

quality and motivated staff at all levels and to

ensure the effective management of the business.

The Committee will be cognisant of comparative

pay levels after taking into account geographic

location and the operations of the business.

The remuneration policy for Directors is set so as

to achieve the above objectives and is broadly

split into Executive and Non-Executive categories,

and consists of the following components in each

sub category:

Executive Directors:

Element Purpose Operation and Review

Basic Salary

Annual Performance

Bonuses

Profit Related Pay

Pension and Death in

Service Life Assurance

Benefits in Kind

Long Term Incentive Plans

Other Share Schemes

To attract and retain effective

management to implement

Group strategy.

To reward delivery of pre-agreed

annual financial objectives.

To encourage achievement

of profit budgets within main

trading subsidiaries.

To facilitate retention and

motivate effective management.

To assist Directors in the

completion of their duties.

To align executive rewards with

returns for shareholders and to

encourage executive retention

and strategic consistency.

To align executive rewards with

benefits available for other

managers in a tax efficient

manner.

Reviewed by the Committee on an annual basis with effect from the

beginning of October, consistent with annual reviews conducted

for all other employees. The current values of individual approved

salaries effective from October 2014, together with the amounts

actually being received are shown in the table opposite. Paid monthly

in arrears.

Individually constructed performance related schemes measured

against specific criteria agreed annually. Paid in the March following

the financial year to which the bonus relates, after completion of the

annual audit.

Subsidiary Company wide employee scheme to reward all staff with a

pro-rata profit share, based on a pre-set formula set out in the report

opposite. Paid in the February following the announcement of the

financial results for the previous year, after completion of the annual

audit.

Fixed Company contributions expressed as a percentage of current

basic salary for each individual paid into a personal pension scheme

held in that individual’s name. The death in service cover provides for

four times current annual salary paid into trust, where death occurs

during the term of the Director’s employment contract.

Benefits restricted to the provision of a Company car and private

medical insurance.

Single fixed term schemes, with performance related conditions,

where the maximum payout is set at approximately one year’s basic

salary paid in shares, based on the market value of those shares as at

the commencement of the scheme.

HMRC Approved tax efficient share schemes offered to other

employees which are also made available to Executive Directors on

the same periodic basis. These include discretionary Company Share

Option Plans (CSOP) and eligible Save As You Earn plans (SAYE).


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Non-Executive Directors:

Element Purpose Operation and Review

Basic Annual Fee

Travelling Expenses

Medical Insurance Benefit

in Kind

To attract and retain a balanced

skill set of individuals to

ensure strong stewardship and

governance of the Group.

To reimburse legitimately

incurred costs of attending

necessary Board and associated

meetings.

To assist Directors in the

completion of their duties.

Fees are set so as to reflect the factors pertinent to respective

positions, taking into account the anticipated amount of time

commitment, and comparative rates paid by other companies of a

similar size. The Non-Executive Directors do not participate in share

option awards, performance bonuses or pension arrangements. Fees

are reviewed by the Remuneration Committee on an annual basis.

Pre-set rates used to reimburse mileage, travel, accommodation and

other incurred expenses in line with those used for other employees.

Benefits restricted to the provision of private medical insurance for

those Directors who do not have alternative arrangements in place.

Remuneration Report

Executive Directors’ Remuneration

In line with the above policy, the Remuneration Committee have approved the following details of Executive Directors’ remuneration:

• Basic salaries. A current maximum approved salary limit for the roles of Chief Executive and Finance Director was approved by the Remuneration

Committee in April 2012, which are shown in the table below in column A. Within these limits, the basic salaries paid during the last financial year

are shown in column B, while the current annualised salaries, which were increased by the standard Company increment in October 2014 of 2.1%,

are shown in column C.

Basic Salary Column A Column B Column C

Executive Approved Basic Salary Current Basic

Director Salary Nov 13 – Oct 14 Salary

£000’s £000’s £000’s

K R Greetham 160 139 142

B P Roberts 130 101 103

D A T Evans n/a 87 89

• Annual performance bonuses and profit related pay. The contractual bonus schemes for K R Greetham and B P Roberts are based on a fixed

percentage of the Group pre-tax Profit, which includes the Group’s share of pre-tax profits from joint ventures and associate investments. The scheme

for D A T Evans is based on a fixed percentage of the Retail segment operating contribution adjusted for administrative costs. The respective bonus

percentages and payments are shown in the table on page 26 in columns A and B respectively. The Executive Directors also participate in the

Company Profit Related Pay Scheme (“PRP”) which is a scheme for employees of Wynnstay (Agricultural Supplies) Limited and Grainlink Limited

and which pays an annual bonus based on a formula which produces a percentile result which is then applied to the relevant individual’s prior year

earnings. The formula calculation is the aggregate of the pre-tax profit of Wynnstay (Agricultural Supplies) Limited and Grainlink Limited divided

by the aggregate of the combined revenues of those companies excluding inter-company turnover, expressed as a percentage. The relevant rate for

2013, paid in February 2014, was 3.4%, with the actual PRP paid shown in Column C on page 26. The anticipated rate for 2014 relating to the last

financial year is 3.6% of relevant earnings.


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Directors’ Remuneration Statement (continued)

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Bonuses Column A Column B Column C

Executive Contractual Bonus PRP

Director Annual received Mar 14 received Feb 14

Bonus % £000’s £000’s

K R Greetham 0.750% 61 7

B P Roberts 0.375% 30 5

D A T Evans 0.400% 23 3

• Pension and death in service life cover. Individual Company contributions to personal pension plans are based on the value of the Executive Directors

basic salary only. The annual defined Company contributions to a personal pension scheme held in the individual’s name expressed as a percentage

of current salary is shown in the table below in column A and the amounts paid on behalf of each individual during the last financial year is shown

in column B. The death in service life assurance cover is provided in a Group policy covering all members, with individual costs attributed to separate

members being unavailable. However the scheme to which all three of the Executive Directors belong had a total renewal cost at November 2013

of £60,995, and there were 376 members covered, meaning an average cost of £162 per person.

Pension Column A Column B

Pension

Executive Pension Contribution

Director % £000’s

K R Greetham 9.6% 13

B P Roberts 6.5% 6

D A T Evans 6.5% 6

• Benefits in kind. Each Executive Director is supplied with a Company car, primarily for the furtherance of their duties. However these vehicles are

available for the executive’s private use and as such have a taxable benefit in kind value calculated in accordance with HMRC rules. These values

for the tax year ending April 2014 are shown in the table below in column A. Executives refund the cost of fuel they use for private motoring on a

monthly basis. Additionally the Company pays the cost of providing private medical insurance for the executives to ensure that should they require

treatment this is provided as quickly as possible, and minimises any period of potential absence from their duties. The cost to the Company of this

cover for each individual in 2014 is shown below in column B.

Benefits in kind Column A Column B

Executive Company Car Private

Director Value Medical Cover

K R Greetham £8,473 £602

B P Roberts £7,578 £602

D A T Evans £7,432 £602

• Long term incentives. The Remuneration policy allows for a single long term incentive plan to be in place at any one time. The 2008 scheme was

structured as a Long Term Performance Related Unapproved Share Option Scheme and vested between October 2013 and March 2014. This scheme

targeted an overall maximum financial gain approximating to one years basic salary as at the beginning of the scheme, for a 100% achievement

of the performance criteria. The award was paid in ordinary shares based on the market value as at the time of exercise. The number of eligible

options and the financial value of the gain obtained from the exercise of the awarded options for each executive are shown in the table opposite.

The financial value of the gain being defined as the difference between the market price of the shares on the date of option exercise and the option

price, which was £0.25, multiplied by the number of options eligible to be exercised. Each executive qualified for the maximum 100% award based

on the achievement of the performance criteria, which related to the basic earnings per share achieved in the financial year ending October 2013

and the market capitalisation of the Company on that date. These respective results were 36.43p and £104.5 million.


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LTIP’s 2008 Scheme 2014 Scheme

Executive Director No of award Financial value Maximum

Options of gain Award

£000’s No. of Options

K R Greetham 22,756 136 23,000

B P Roberts 15,385 91 23,000

D A T Evans 11,538 69 18,000

Following the final vesting date of the above scheme, a new long term incentive plan was implemented for Executive Directors in October 2014

in line with the policy criteria outlined above. The scheme is again structured as a Long Term Performance Related Unapproved Share Option

Scheme with options being exercisable within a six month period commencing on the third anniversary of the grant date, providing the performance

conditions have been satisfied. The maximum award available for a 100% achievement of the performance criteria for each executive, in terms of

eligible options, is shown in the table above. The performance conditions relate to the earnings per share (“EPS”) and market capitalisation (“MC”)

of the Group as at October 2017, with the size of the award, as a percentage of the maximum available, based on the matrix below. The executive

will pay an option price of 25p per share.

(MC) (EPS)

< £110m £110m £115m £120m £125m £130m £135m £140m >£140m

<36p nil nil nil nil nil nil nil nil nil

36p nil 30% 40% 50% 60% 70% 80% 90% 100%

37p nil 40% 50% 60% 70% 80% 90% 100% 100%

38p nil 50% 60% 70% 80% 90% 100% 100% 100%

39p nil 60% 70% 80% 90% 100% 100% 100% 100%

40p nil 70% 80% 90% 100% 100% 100% 100% 100%

41p nil 80% 90% 100% 100% 100% 100% 100% 100%

42p nil 90% 100% 100% 100% 100% 100% 100% 100%

>42p nil 100% 100% 100% 100% 100% 100% 100% 100%

• Other share schemes. The Executive Directors participate in the discretionary Approved Company Share Option Plan (CSOP), which is a tax efficient

scheme providing the opportunity to hold up to £30,000 of option value, which providing the scheme rules and legislation are complied with, can

be exercised free of income tax liability for the holder. Additionally the current Executive Directors are eligible to participate in Saye As You Earn

(SAYE) option invitations, subject to the scheme and legislative limitations. Such options held by the Executive Directors, which do not have any

performance criteria attached to them, are exercisable between April 2015 and April 2022 and details are provided in the Directors’ Report on page

20 and 21, and in Note 9 to the accounts.

Non-Executive Directors’ Remuneration

The remuneration of the Non-Executive Directors’ is and has been paid in accordance with the policy outlined above and has been set so as to reflect the

factors pertinent to their respective positions. Details of the amounts received during the last financial year and the current levels of Basic Annual Fees

being paid are given in the table below:

Basic Fee Benefits Travelling Current Benefits

in kind Expenses Basic Fee in kind

£000’s £000’s £000’s £000’s £000’s

J J McCarthy 49 - 1 49 -

P M Kirkham 34 - 1 34 1

J C Kendrick *1 14 - - n/a n/a

Lord Carlile CBE, QC 34 1 1 34 1

H J Richards *2 8 - - 34 1

2014 / 2015

*1 Retired March 2014*2 Appointed July 2014

Lord Carlile CBE, QC

Vice-Chairman and Chairman of Remuneration Committee

20 January 2015

By order of the Board.


Financial Year ended Oct 2014


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Independent Auditor’s Report to the Shareholders of Wynnstay Group Plc

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We have audited the financial statements

of Wynnstay Group Plc for the year ended

31 October 2014 set out on pages 30 to 62.

The financial reporting framework that has been

applied in their preparation is applicable law

and International Financial Reporting Standards

(IFRSs) as adopted by the EU and, as regards the

Parent Company financial statements, as applied

in accordance with the Companies Act 2006.

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

auditor’s 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.

Respective Responsibilities of Directors and Auditor

As explained more fully in the Directors’

Responsibilities Statement set on out page 21,

the Directors are responsible for the preparation

of the financial statements and for being satisfied

that they give a true and fair view.

Our responsibility is to audit, and express

an opinion on, the financial statements in

accordance with applicable law and International

Standards on Auditing (UK and Ireland). Those

standards require us to comply with the Auditing

Practices Board’s Ethical Standards for Auditors.

Scope of the Audit of the Financial Statements

A description of the scope of an audit of

financial statements is provided on the

Financial Reporting Council website at

www.frc.org.uk/auditscopeukprivate.

Opinion on Financial Statements

In our opinion:

• the financial statements give a true and fair

view of the state of the Group’s and of the

Parent Company’s affairs as at 31 October

2014 and of the Group’s profit for the year

then ended;

• the Group financial statements have been

properly prepared in accordance with IFRSs

as adopted by the EU;

• the Parent Company financial statements

have been properly prepared in accordance

with IFRSs as adopted by the EU and as

applied in accordance with the provisions

of the Companies Act 2006; and

• the financial statements have been prepared

in accordance with the requirements of the

Companies Act 2006.

Opinion on other Matters Prescribed by the Companies Act 2006

In our opinion:

• the information given in the Strategic

Report and Directors’ Report for the

financial year for which the financial

statements are prepared is consistent with

the financial statements.

Matters on which we are Required to Report by Exception

We have nothing to report in respect of the

following matters where the Companies Act

2006 requires us to report to you if, in our

opinion:

• adequate accounting records have not

been kept, by the Parent Company, or

returns adequate for our audit have not

been received from branches not visited by

us; or

• the Parent Company 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;

Nicola Quayle (Senior Statutory Auditor)

For and on behalf of

KPMG LLP, Statutory Auditor

Chartered Accountants 8 Princes Parade

Liverpool

L3 1QH

20 January 2015


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Consolidated Statement of Comprehensive Income for the year ended 31 October 2014

Fin

anci

al S

tate

me

nts

Revenue

Cost of sales

Gross profit

Manufacturing, distribution and selling costs

Administrative expenses

Other operating income

Group operating profit before intangible amortisation, share-based

payment costs and exceptional item

Intangible amortisation and share-based payments

Exceptional item

Group operating profit

Interest income

Interest expense

Share of profits/losses in associate and joint ventures

accounted for using the equity method

Share of tax incurred by associate and joint ventures

Profit before taxation

Taxation

Profit for the year

Earnings per 25p share

Diluted earnings per 25p share

All of the above are derived from continuing operations.

There was no other comprehensive income during the current or prior year.

The notes on pages 34 to 62 form part of these financial statements.

Note

2

4

5

6

3

3

7

10

12

12

2014

£000

413,558

(360,353)

53,205

(40,838)

(4,455)

588

8,500

(109)

-

8,391

(326)

428

8,493

(1,796)

6,697

35.28p

34.63p

£000

52

(378)

536

(108)

2013

£000

413,481

(363,728)

49,753

(36,672)

(4,319)

-

8,762

(182)

(350)

8,230

(478)

269

8,021

(1,850)

6,171

36.43p

35.25p

£000

46

(524)

362

(93)


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Consolidated and Company Balance Sheetas at 31 October 2014

Registered number 2704051

The financial statements were approved by the Board of Directors on 20 January 2015 and signed on its behalf.

J J McCarthy – Director B P Roberts - Director


Assets

Non-current assets

Goodwill

Property, plant and equipment

Investment in subsidiaries

Investments accounted for using equity method

Intangibles

Current assets

Inventories

Trade and other receivables

Held for sale assets

Financial assets

- loan to joint venture

Cash and cash equivalents

Total assets

Liabilities

Current liabilities

Financial liabilities - borrowings

Trade and other payables

Current tax liabilities

Net current assets / (liabilities)

Non-current liabilities

Financial liabilities – borrowings

Trade and other payables

Deferred tax liabilities

Total liabilities

Net assets

Equity

Share capital

Share premium

Other reserves

Retained earnings

Total Equity

Note

13

15

16

16

14

19

20

21

17

24

25

22

23

25

22

27

28

£000

17,209

18,289

-

3,643

89

39,230

29,758

48,749

2,372

2,802

8,990

92,671

131,901

(3,938)

(47,088)

(678)

(51,704)

40,967

(2,300)

(339)

(327)

(2,966)

(54,670)

77,231

4,777

27,633

2,796

42,025

77,231

£000

17,014

17,861

-

3,365

99

38,339

30,602

51,271

2,287

3,067

6,636

93,863

132,202

(4,855)

(49,338)

(1,221)

(55,414)

38,449

(4,269)

(711)

(259)

(5,239)

(60,653)

71,549

4,713

26,986

2,697

37,153

71,549

£000

-

8,258

18,182

749

-

27,189

-

29,896

2,372

2,802

12

35,082

62,271

(2,600)

(3,167)

(13)

(5,780)

(29,302)

(1,369)

(94)

-

(1,463)

(7,243)

55,028

4,777

27,633

2,627

19,991

55,028

2014

£000

6,660

13,124

18,182

1,048

-

39,014

17,334

36,819

2,287

3,067

647

60,154

99,168

(3,192)

(34,655)

(700)

(38,547)

21,607

(4,237)

(417)

(105)

(4,759)

(43,306)

55,862

4,713

26,986

2,528

21,635

55,862

2013

Group Company

2014 2013


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Consolidated and Company Statement of Changes in Equity as at 31 October 2014

Fin

anci

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tate

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Group

At 1 November 2012

Profit for the year

Total comprehensive income for the year

Transactions with owners of the Company, recognised directly in equity

Shares issued during the year

Dividends

Equity settled share-based payment transactions

Total contributions by and distributions to owners of the Company

At 31 October 2013

Profit for the year


Transactions with owners of the Company, recognised directly in

equity


Dividends



At 31 October 2014

Share

capital

£000

4,186

-

-

527

-

-

527

4,713

-

-

64

-

-

64

4,777

premium

account

£000

17,677

-

-

9,309

-

-

9,309

26,986

-

-

647

-

-

647

27,633

Other

reserves

£000

2,515

-

-

-

-

182

182

2,697

-

-

-

-

99

99

2,796

Retained

earnings

£000

32,448

6,171

6,171

-

(1,466)

-

(1,466)

37,153

6,697

6,697

-

(1,825)

-

(1,825)

42,025

Total

£000

56,826

6,171

6,171

9,836

(1,466)

182

8,552

71,549

6,697

6,697

711

(1,825)

99

(1,015)

77,231

Share

Company

At 1 November 2012

Profit for the year


Transactions with owners of the Company, recognised directly in equity


Dividends



At 31 October 2013

Profit for the year


Transactions with owners of the Company, recognised directly in

equity


Dividends



At 31 October 2014

Share

capital

£000

4,186

-

-

527

-

-

527

4,713

-

-

64

-

-

64

4,777

Share

premium

account

£000

17,677

-

-

9,309

-

-

9,309

26,986

-

-

647

-

-

647

27,633

Other

reserves

£000

2,346

-

-

-

-

182

182

2,528

-

-

-

-

99

99

2,627

Retained

earnings

£000

19,889

3,212

3,212

-

(1,466)

-

(1,466)

21,635

181

181

-

(1,825)

-

(1,825)

19,991

Total

£000

44,098

3,212

3,212

9,836

(1,466)

182

8,552

55,862

181

181

711

(1,825)

99

(1,015)

55,028

There was no other comprehensive income during the current or prior year.



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Fin

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Consolidated and Company Cash Flow Statementas at 31 October 2014

Cash flows from operating activities

Cash generated from operations

Interest received

Interest paid

Tax paid

Net cash flows from operating activities

Cash flows from investing activities

Acquisitions in the year

Utilisation of cash acquired on acquisition

Proceeds from sale of property, plant and equipment

Purchase of property, plant and equipment

Proceeds on sale of investments

Investments in assets held for resale

Purchase of investments

Dividends received

Net cash flows used by investing activities

Cash flows from financing activities

Net proceeds from the issue of ordinary share capital

Net proceeds from drawdown of new loans

Finance lease principal repayments

Repayment of borrowings

Dividends paid to shareholders

Net cash flows generated from financing activities

Net increase/(decrease) in cash and cash equivalents

Cash and cash equivalents at the beginning of the period

Cash and cash equivalents at the end of the period

Note

38

24

2014

£000

11,773

52

(378)

(2,271)

9,176

(120)

-

289

(2,450)

150

(85)

-

-

(2,216)

711

272

(792)

(2,054)

(1,825)

(3,688)

3,272

5,117

8,389

2013

£000

12,956

46

(524)

(2,036)

10,442

(5,254)

47

729

(1,878)

150

(130)

(40)

-

(6,376)

9,836

896

(830)

(1,708)

(1,466)

6,728

10,794

(5,677)

5,117

2014

£000

1,759

-

(26)

(110)

1,623

-

-

132

(695)

150

(85)

-

-

(498)

711

-

-

(646)

(1,825)

(1,760)

(635)

647

12

2013

£000

(3,972)

30

(433)

(802)

(5,177)

(566)

-

678

(792)

150

(130)

(41)

500

(201)

9,836

896

(774)

(1,107)

(1,466)

7,385

2,007

(1,360)

647

Group Company



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Principal Accounting Policies

Accounting Policies

The Group’s principal accounting policies

adopted in the preparation of these financial

statements are set out below. These policies

have been consistently applied to all years

presented, unless otherwise stated.

Basis of preparation

The Group’s financial statements have been

prepared in accordance with International

Financial Reporting Standards as adopted

by the European Union (IFRS), International

Financial Reporting Interpretation Committee

(IFRIC) interpretations and those provisions

of the Companies Act 2006 applicable to

companies reporting under IFRS. The Group

financial statements have been prepared

under the historical cost convention other than

certain assets which are at deemed cost under

the transition rules, share based payments

which are included at fair value and certain

financial instruments which are explained in

the relevant section below. A summary of the

material Group accounting policies are set out

below. The preparation of financial statements in

conformity with IFRS requires the use of certain

critical accounting estimates and assumptions

that affect the reported amounts of assets and

liabilities at the date of the financial statements,

and the reported amounts of revenues and

expenses during the reporting period. Although

these estimates are based on management’s

best knowledge of the amount, event or actions,

actual results ultimately may differ from those

estimates.

Going concern

As highlighted in note 24 to the financial

statements, the Group meets its day to day

working capital requirements through the use

of cash balances and overdraft facilities which

are due for review on an annual basis. The

current economic conditions create uncertainty,

particularly over: (a) the level of demand for

the Group’s products; (b) the exchange rate

between sterling and the US dollar which has

consequences for the cost of the Group’s raw

materials; and (c) the availability of bank finance

in the foreseeable future.

The Group’s forecasts and projections, taking

account of reasonable possible changes in

trading performance, show that the Group should

be able to operate within the level of its current

cash balances and overdraft facilities. These

overdraft facilities are next scheduled for review,

as usual, in April 2015, however the Group are

currently finalising negotiations with their main

bank for new debt arrangements on improved

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terms, and have received a credit approved offer

which is expected to be in place before April

2015. During these negotiations no matters have

been drawn to the Group’s attention to suggest

that the new facilities or the existing overdraft

arrangements may not be forthcoming.

Basis of consolidation

The Group’s consolidated financial statements

incorporate the financial statements of Wynnstay

Group Plc (‘the Company’) and entities controlled

by Wynnstay Group Plc (its ‘subsidiaries’)

together with the Group’s share of the results

of its associate and joint ventures. Group inter-

company transactions are eliminated in full.

Results of subsidiary undertakings acquired are

included in the financial statements from the

effective date of control. The net assets, both

tangible and intangible, of acquired subsidiary

undertakings are incorporated into the financial

statements on the basis of their fair value as

at the effective date of control. All business

combinations are accounted for by applying the

acquisition method. Subsidiaries are entities

where the Group has the power to govern the

financial and operating policies, generally

accompanied by a share of more than 50% of the

voting rights. Subsidiaries are consolidated from

the date on which control is assumed by the

Group and are included until the date the Group

ceases to control them. Associates are entities

over which the Group has significant influence

but not control, generally accompanied by a

share of between 20% and 50% of the voting

rights. Joint ventures are entities over which

the Group has joint control. Investments in

associates and joint ventures are accounted for

using the equity method.

Revenue recognition

Revenue represents the invoiced value of sales

which fall within Wynnstay Group’s ordinary

activities. Revenue is measured at the fair value

of the contract, net of rebates excluding value

added tax and after eliminating sales within the

Group.

Revenue from the sale of goods is recognised

either at the point of sale through the till or

when the Group has transferred the significant

risks and rewards of ownership of goods to the

buyer, for example, delivering products into the

customer’s possession, and when the amount of

revenue can be measured reliably and when it is

probable that the economic benefits associated

with the transaction will flow to the Group.

Non-recurring items

Non-recurring items that are material by size

and/or by nature are disclosed on the face of

the consolidated statement of comprehensive

income and within a note to the financial

statements as exceptional items. Management

consider that the separate disclosure of non-

recurring items helps provide a better indication

of the Group’s underlying business performance.

Financial instruments

Financial assets and liabilities are recognised

on the Company and Group’s consolidated

balance sheet when the Company and/or Group

becomes a party to the contractual provisions of

the instrument. The main categories of financial

instruments are:

Trade receivables

Trade and other receivables are recognised at fair

value, less any impairment losses.

Investments

Investments are initially measured at cost. They

are classified as either ‘available-for-sale’, ‘fair

value’, or ‘held to maturity’. Where securities

are designated as at ‘fair value’ gains or losses

arising from changes in fair value are included

in the net profit or loss for the period. For

‘available-for-sale’ investments, gains or losses

arising from changes in fair value are recognised

directly in equity, until the security is disposed

of or is determined to be impaired, at which

time the cumulative gain or loss previously

recognised in equity is included in the net profit

or loss for the period. Equity investments that

do not have a quoted market price in an active

market and whose fair value cannot be reliably

measured by other means are held at cost.

Interest-bearing borrowings

Interest-bearing bank loans and overdrafts

are initially recorded at fair value, net of

attributable transaction costs. Subsequent to

initial recognition, interest-bearing borrowings

are stated at amortised cost with any difference

between proceeds and redemption value

being recognised in the Group Statement of

Consolidated Income over the period of the

borrowings on an effective interest basis.

Trade payables

Trade and other payables are recognised at fair

value.

Equity instruments

Equity instruments issued by the Group and/or

Company are recorded at the proceeds received,

net of direct issue costs. An equity instrument is

any contract that evidences a residual interest

in the assets of the Group and/or Company after

deducting all of its liabilities.


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Derivative financial instruments and hedging

The Group uses derivative financial instruments

to hedge its exposure to foreign exchange,

and commodity risks arising from day to day

activities. The Group does not hold or issue

derivative financial instruments for trading

purposes, however, if derivatives do not qualify

for hedge accounting they are accounted for as

such.

Derivative financial instruments are recognised

and stated at fair value. Where derivatives do not

qualify for hedge accounting, any gains or losses

on re-measurement are immediately recognised

in the Group Statement of Consolidated Income.

Where derivatives qualify for hedge accounting,

recognition of any resultant gain or loss depends

on the nature of the hedge relationship and the

item being hedged. In order to qualify for hedge

accounting, the Group is required to document

from inception the relationship between the

item being hedged and the hedging instrument.

The Group is also required to document and

demonstrate an assessment of the relationship

between the hedged item and the hedging

instrument, which shows that the hedge will

be highly effective on an ongoing basis. This

effectiveness testing is performed at each period

end to ensure that the hedge remains highly

effective.

Derivative financial instruments with maturity

dates of more than one year from the balance

sheet date are disclosed as non-current.

Fair value hedging

Derivative financial instruments are classified

as fair value hedges when they hedge the

Group’s exposure to changes in the fair value

of a recognised asset or liability. Changes in

the fair value of derivatives that are designated

and qualify as fair value hedges are recorded in

the Group Statement of Comprehensive Income

together with any changes in the fair value of the

hedged item that is attributable to the hedged

risk.

Leases

Leases are classified as finance leases at

inception where substantially all of the risks and

rewards of ownership are transferred to the Group.

Assets classified as finance leases are capitalised

on the balance sheet and are depreciated over

the expected useful life of the asset. The interest

element of the rental obligations is charged

to the Group Statement of Comprehensive

Income over the period of the lease. Rentals

paid under operating leases are charged to the

Group Statement of Comprehensive Income

on a straight-line basis over the term of the

lease. Leasehold land is normally classified as

an operating lease. Payments made to acquire

leasehold land are included in prepayments at

cost and are amortised over the life of the lease.

Any incentives to enter into operating leases are

recognised as a reduction of rental expense over

the lease term on a straight-line basis.

Property, plant and equipment

Property, plant and equipment are stated at

cost, net of accumulated depreciation and any

provision for impairment losses. Depreciation is

provided at rates calculated to write off the cost

less estimated residual value of fixed assets over

their expected useful lives as follows:

Freehold property

- 2.5% - 5% per annum straight line

Lease premium

- over the period of the lease

Leasehold land and buildings

- over the period of the lease

Plant and machinery and office equipment

- 10% - 33% per annum straight line

Motor vehicles

- 20% - 30% per annum straight line

Goodwill

Goodwill represents the excess of the cost of

acquisition over the fair value of the identifiable

assets, liabilities and contingent liabilities of the

acquired entity at the date of the acquisition.

At the date of acquisition, goodwill is allocated

to cash generating units for the purpose of

impairment testing. Goodwill is recognised as

an asset and assessed for impairment annually.

Any impairment is recognised immediately in

the Group Statement of Comprehensive Income.

Once recognised, an impairment of goodwill is

not reversed.

Impairment of assets

At each reporting date, the Group assesses

whether there is any indication that an asset

may be impaired. Where an indicator of

impairment exists, the Group makes an estimate

of recoverable amount. Where the carrying

amount of an asset exceeds its recoverable

amount the asset is written down to its

recoverable amount. Recoverable amount is the

higher of fair value less costs to sell and value in

use, and is considered for each individual asset.

If the asset does not generate cash flows that are

largely independent of those from other assets or

groups of assets, the recoverable amount of the

cash generating unit to which the asset belongs

is determined. Discount rates reflecting the

asset specific risks and the time value of money

are used for the value in use calculation.

Employment benefit costs

The Group operates a defined contribution

pension scheme. Contributions to this scheme

are charged to the Group Statement of

Comprehensive Income as they are incurred, in

accordance with the rules of the scheme.

Inventories

Inventories are stated at the lower of cost and net

realisable value. Cost comprises direct materials

and, where applicable, direct labour costs

and those overheads that have been incurred

in bringing the inventories to their present

location and condition. Where appropriate,

cost is calculated on a specific identification

basis. Otherwise inventories are valued using

the first-in-first-out method. Net realisable value

represents the estimated selling price less all

estimated costs to completion and costs to be

incurred in marketing, selling and distribution.

Taxation including deferred taxation

The income tax expense represents the sum of

the current income tax and deferred income tax.

Current income tax is based on the taxable profits

for the year. Taxable profit differs from the profit

as reported in the Statement of Comprehensive

Income because it excludes items of income

and expense that are taxable or deductible in

other years and it further excludes items that are

never taxable or deductible. The Group’s liability

for current tax is calculated using tax rates that

have been enacted or substantively enacted by

the balance sheet date.

Deferred income tax is provided in full, using

the liability method, on temporary differences

arising between the tax bases of assets and

liabilities and their carrying amounts in the

Group financial statements. However, deferred

income tax is not accounted for if it arises

from initial recognition of an asset or liability

other than a business combination. Deferred

income tax is determined using tax rates (and

laws) that have been enacted or substantively

enacted by the balance sheet date and are

expected to apply when related deferred income

tax asset is realised or the deferred income tax

liability settled. Deferred income tax assets are

recognised to the extent that it is probable that

future taxable profits will be available against

which the temporary differences can be utilised.

Dividends

Final equity dividends to the shareholders of the

Company are recognised in the period that they

are approved by the shareholders. Interim equity

dividends are recognised in the period that they

are paid.


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Share-based payments

The Group issues equity-settled share-based

payments to certain employees. Equity-settled

share-based payments are measured at fair

value at the date of the grant. The fair value

determined at the grant date of the equity-

settled share-based payments is expensed on

a straight-line basis over the vesting period,

based on the Group’s estimate of shares that

will eventually vest. Fair value is measured

by use of a valuation model. The expected life

used in the model has been adjusted, based on

management’s best estimate, for the effects

of non-transferability, exercise restrictions and

behavioural considerations. The movements in

respect of equity-settled share-based payments

are recognised in other reserves.

Investments

Investments held as fixed assets are shown at

cost less provisions impairment.


Cash and cash equivalents, for the purposes of

the consolidated cash flow statement, comprise

cash at bank and in hand, money market deposits

and other short term highly liquid investments

with original maturities of three months or

less and bank overdrafts. Bank overdrafts are

presented in borrowings within current liabilities

in the balance sheet.

Foreign currencies

Monetary assets and liabilities denominated in

foreign currencies are translated into sterling

at the rate of exchange ruling at the balance

sheet date. Transactions in foreign currencies

are translated into sterling at the rate ruling on

the date of the transaction. Exchange gains and

losses are recognised in the Group Statement of

Comprehensive Income.

Employee share ownership trust

The Company operates an employee share

ownership trust. The assets, liabilities, income

and cost of the ESOP are incorporated into the

financial statements of the Group.

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Significant judgements, key assumptions and estimates

Application of certain Group accounting policies

requires management to make judgements,

assumptions and estimates concerning the

future as detailed:

Application of the “own use” exemption

Forward contracts are entered into by the

Group to purchase and/or sell grain and other

agricultural commodities, and management

judge that these forward commodity contracts

are entered into for the Groups “own use”

rather than as trading instruments when they

are entered into. They continue to be held in

accordance with the Group’s expected purchase,

sale and/or usage requirements.

Impairment of goodwill

The carrying value of goodwill must be assessed

for impairment annually. This requires an

estimation of the value in use of the cash

generating units to which goodwill is allocated.

Value in use is dependent on estimations of

future cash flows from the cash generating unit

and the use of an appropriate discount rate to

discount those cash flows to their present value.

Valuation of share-based payments

The fair value of share-based payments

is determined using valuation models

and is charged to the Group Statement of

Comprehensive Income over the vesting period.

Estimations of vesting and satisfaction of

performance criteria are required to determine

fair value.

Provision for impairment of trade receivables

The financial statements include a provision for

impairment of trade receivables that is based

on management’s estimation of recoverability.

There is a risk that the provision will not match

the trade receivables that ultimately prove to be

irrecoverable.

Provision for impairment of inventories

The financial statements include a provision

for impairment of inventories that is based on

management’s estimation of recoverability.

There is a risk that the provision will not match

the inventories that ultimately prove to be

impaired.

Principal Accounting Policies (continued)


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New standards and interpretations

The following new accounting standards, amendments and interpretations to published standards are not yet effective and have not been adopted early

by the Group:

International Financial Reporting Standards (“IFRS”)

Transition guidance : Amendments to IFRS 10, IFRS 11 and IFRS 12 1 January 2014

IFRS 10: ‘Consolidated financial statement’ 1 January 2014

IFRS 11: ‘Joint arrangements’ 1 January 2014

IFRS 12: ‘Disclosure of interest in Other Entities’ 1 January 2014

1 January 2014

Amendments to existing standards

Certain elements of Annual Improvements to IFRS 2009 - 2011 1 January 2014

IAS 27 (revised 2011): ‘Separate financial statements’ 1 January 2014

IAS 28 (revised 2011): ‘Investments in associates and joint ventures’ 1 January 2014

There have been a number of minor changes to standards which became applicable for the year ended 31 October 2014, none of which have been

assessed as having a significant impact on the Group.

EU effective date for accounting periods commencing on

or after


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Notes to the Financial Statements

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1. The Company is taking advantage of the exemption, in s408 of the Companies Act 2006, not to present its individual income statement and

related notes that form a part of these approved financial statements.

2. Segmental Reporting

IFRS 8 requires operating segments to be identified on the basis of internal financial information about the components of the Group that are

regularly reviewed by the chief operating decision maker (“CODM”) to allocate resources to the segments and to access their performance.

The chief operating decision-maker has been identified as the Board of Directors (‘the Board’). The Board reviews the Group’s internal reporting

in order to assess performance and allocate resources. The Board has determined that the operating segments, based on these reports are

Agriculture, Specialist Retail and Other.

The Board considers the business from a product/service perspective. In the Board’s opinion, all of the Group’s operations are carried out in the

same geographical segment namely the United Kingdom.

Agriculture - Manufacturing and supply of animal feeds, fertiliser, seeds and associated agricultural products.

Specialist Retail - Supplies of a wide range of specialist products to farmers, smallholders, and pet owners.

Other - Miscellaneous operations not classified as Agriculture or Specialist Retail.

The Board assesses the performance of the operating segments based on a measure of operating profit. Finance income and costs are not

included in the segment result that is assessed by the Board. Other information provided to the Board is measured in a manner consistent with

that in the financial statements.

Inter-segmental transactions are entered into under the normal commercial terms and conditions that would be available to unrelated third

parties.

The segment results for the year ended 31 October 2014 are as follows:

Year ended 31 October 2014

Revenue from external customers

Segment result

Share of results of associate and joint ventures before tax

Interest income

Interest expense

Profit before tax

Income taxes (includes tax of associate and joint ventures)

Profit for the year attributable to equity shareholders

Segment net assets

Corporate net cash (note 25)

Total net assets

Agriculture

£000

308,711

3,476

326

3,802

29,449

Specialist Retail

£000

104,617

4,798

77

4,875

37,849

Other

£000

230

117

133

250

7,181

Total

£000

413,558

8,391

536

8,927

52

(378)

8,601

(1,904)

6,697

74,479

2,752

77,231

Year ended 31 October 2013

Revenue from external customers

Segment result

Share of results of associate and joint ventures before tax

Exceptional item

Interest income

Interest expense

Profit before tax

Income taxes (includes tax of associate and joint ventures)

Profit for the year attributable to equity shareholders

Segment net assets

Corporate net borrowings (note 25)

Total net assets

Agriculture

£000

322,995

4,542

359

4,901

29,553

Specialist Retail

£000

90,191

4,427

-

4,427

37,194

Other

£000

295

(389)

3

(386)

7,290

Total

£000

413,481

8,580

362

8,942

(350)

46

(524)

8,114

(1,943)

6,171

74,037

(2,488)

71,549


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3. Finance Costs

Interest expense:

Interest payable on borrowings

Interest payable on finance leases

Interest payable on other loans

Interest and similar charges payable

Interest income

Interest receivable

Finance costs

2014

£000

(271)

(107)

-

(378)

52

52

(326)

2013

£000

(378)

(108)

(38)

(524)

46

46

(478)

4. Other Operating Income

Rental income

Grooming commission

Profit on sale of Acocks Green

Other operating income

2014

£000

375

28

136

49

588

2013

£000

-

-

-

-

-

5. Exceptional Item

Exceptional costs

2014

£000

-

2013

£000

(350)

Exceptional costs relate to the expenses associated with the acquisition and subsequent re-organisation of the business and certain trading assets of Carmarthen & Pumsaint Farmers.

6. Group Operating Profit

The following items have been included in arriving at operating profit:

Staff costs

Depreciation of property, plant and equipment: - owned assets

- under finance

Amortisation of intangibles

(Profit) on disposal of fixed assets

Other operating lease rentals payable

Repairs and maintenance expenditure on plant, property and equipment

Trade receivables impairment

2014

£000

23,816

1,945

564

10

(171)

2,858

1,630

68

2013

£000

21,597

1,881

641

1

(131)

2,323

1,715

52

Services provided by the Group’s auditor

During the year the Group obtained the following services from the Group’s auditor:

Audit services – statutory audit

Tax services

Due diligence

XBRL tagging

2014

£000

95

4

-

1

2013

£000

90

4

27

1

Included in the Group audit fee are fees of £5,000 (2013: £43,500) paid to the Group’s auditor in respect of the Parent Company, the fees relating to the parent company are borne by one of the Group’s subsidiaries.


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Notes to the Financial Statements (continued)

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7. Share of Post-tax Profit/(Loss) of Associate and Joint Ventures

Share of post-tax profit in associate

Share of post-tax profits/(loss) in joint ventures

Total share of post-tax profits of associate and joint ventures

2014

£000

85

343

428

2013

£000

54

215

269

8. Staff Costs

The aggregate payroll costs, including Directors’ emoluments, charged in the financial statements for the Group were as follows:

Wages and salaries

Social security costs

Pension and other costs

Cost of share-based reward

2014

£000

21,041

1,887

789

99

23,816

The average number of employees, including Directors’ employed by the Group during the year was as follows:

Administration

Production

Sales, distribution and retail

2014

No.

97

91

793

981

2013

£000

19,121

1,701

593

182

21,597

2013

No.

100

89

712

901


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9. Directors’ Remuneration

Directors’ emoluments

Company contributions to money purchase pension schemes

Aggregate gains made on the exercise of Approved SAYE options

2014

£000

621

25

296

942

2013

£000

642

25

52

719

Aggregate Directors’ remuneration

Details of the Directors’ interest in the share capital of the Company, including outstanding share options at the year end, are provided in the Directors‘ Report. The following remuneration detail is provided in accordance with AIM Rule 19.

Name of Director

Executives

K R Greetham

B P Roberts

D A T Evans

Non-Executives

J J McCarthy


Lord Carlile CBE, QC

P M Kirkham


E G Owen (died September 2013)

J E Davies (retired March 2013)

Basic salary

£000

139

101

87

49

14

34

34

8

-

-

466

Benefits

in kind

£000

9

8

8

-

-

1

-

-

-

-

26

Annual

bonuses

£000

68

35

26

-

-

-

-

-

-

-

129

2014

Total

£000

216

144

121

49

14

35

34

8

-

-

621

2013

Total

£000

210

140

112

33

33

34

19

-

45

16

642

Money purchase pension scheme

Contribution paid by the Group to money purchase pension schemes in

respect of such Directors were:

K R Greetham

B P Roberts

D A T Evans

2014

No.

3

£000

13

6

6

25

2013

No.

3

£000

13

6

6

25

Retirements benefits are accruing to the following number of Directors under:

Gains made on exercise of Unapproved 5 year LTIP options (2013: Approved SAYE options)

K R Greetham

B P Roberts

D A T Evans

2014

£000

136

91

69

296

2013

£000

22

8

22

52


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Analysis of tax charge in year

Current tax

- continuing operations

- adjustments in respect of prior years

Total current tax

Deferred tax

- accelerated capital allowances

- effect of decrease of rate

Total deferred tax

Tax on profit on ordinary activities

2014

£000

1,839

(111)

1,728

77

(9)

68

1,796

2013

£000

1,915

(7)

1,908

(51)

(7)

(58)

1,850

10. Taxation

Factors affecting tax charge for the year

The tax assessed for the year is lower than (2013:lower) the standard rate of corporation tax in the UK applicable to the Group 21.83% (2013: 23.41%), explained as follows:

Profit on ordinary activities before tax

Profit on ordinary activities multiplied by standard rate of corporation tax in

the UK of 21.83% (2013: 23.41%)

Effects of:

Tax effect of share of profit of associates and joint ventures

Expenses not deductible for tax purposes

Adjustment to tax charge in respect of prior years

Utilisation of tax losses

Effect of decrease in rate

Other items

Total tax charge for year

2014

£000

8,493

1,854

(93)

23

(111)

7

(9)

125

1,796

2013

£000

8,021

1,877

(63)

145

(7)

8

(7)

(103)

1,850

Factors that may affect future tax charges

The Chancellor has announced a reduction in the main rate of UK corporation tax to 20% effective from 1 April 2015 enacted on 2 July 2013. This will reduce the Group’s future current tax charge accordingly.

The deferred tax liability has been calculated based on the rate of 20% substantively enacted at the balance sheet date.

11. Dividends

Subsequent to the year end it has been recommended that a final dividend of 6.80p net per ordinary share (2013: 6.20p) be paid on 30 April 2015. Together with the interim dividend already paid on 31 October 2014 of 3.40p net per ordinary share (2013: 3.10p) this would result in a total dividend for the financial year of 10.20p net per ordinary share (2013: 9.30p).

Final dividend paid for prior year

Interim dividend paid for current year

2014

£000

1,177

648

1,825

2013

£000

946

520

1,466


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Earnings attributable to shareholders (£000)

Weighted average number of shares in issue during the year (number ‘000)

Earnings per ordinary 25p share (pence)

2014

6,697

18,981

35.28

2013

6,171

16,941

36.43

2014

6,697

19,338

34.63

2013

6,171

17,508

35.25

Basic earnings per share Diluted earnings per share

12. Earnings per share

Basic earnings per 25p ordinary share is calculated by dividing the earnings attributable to ordinary shareholders by the weighted average number of ordinary shares in issue during the year excluding those held in the Employee Share Ownership Trust (note 35) which are treated as cancelled.

For diluted earnings per share, the weighted average number of ordinary shares is adjusted to assume conversion of all dilutive potential ordinary shares (share options and warrants) taking into account their exercise price in comparison with the actual average share price during the year.

13. Goodwill

After initial recognition, goodwill is subject to annual impairment tests or more frequently if events or changes in circumstances indicate that it might be impaired, in accordance with IAS 36.

Group

Cost

At 1 November 2012

Additions

At 31 October 2013

Additions (note 18)

At 31 October 2014

Aggregate impairment

At 1 November 2012 and 31 October 2013

Impairment charge

At 31 October 2014

Net book value

At 31 October 2014

At 31 October 2013

Company

Cost

At 1 November 2012

Transfer from investments

At 31 October 2013

Transferred to subsidiary

At 31 October 2014

Aggregate impairment

At 1 November 2012 and 31 October 2013

Transferred to subsidiary

At 31 October 2014

Net book value

At 31 October 2014

At 31 October 2013

£000

17,251

1,400

18,651

195

18,846

1,637

-

1,637

17,209

17,014

£000

6,618

936

(7,554)

-

894

-

-

During the year the goodwill was transferred to the trading subsidiary of Wynnstay (Agricultural Supplies) Limited as part of the hive down of the Company’s trade and assets of the trading business of Wynnstay Group Plc.

During the year investments valued at £nil (2013: £936,401) have been transferred to goodwill in the Company, the investments trade and assets have been hived up into Wynnstay Group Plc in the current and preceding year in respect of PSB and Banbury acquisitions.

7,554

(894)

6,660


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13. Goodwill (continued)

Goodwill Impairment

Goodwill arising on business combinations is not amortised but is reviewed for impairment on an annual basis, or more frequently if there are indications that goodwill may be impaired. Goodwill acquired in a business combination is allocated to groups of cash generating units according to the level at which management monitor that goodwill.

Recoverable amounts for cash generating units are based on the higher of value in use and fair value less costs to sell. Value in use is calculated from cash flow projections for the next 5 years using data from the Group’s latest internal forecasts, the results of which are reviewed by the Board.

The key assumptions for the value in use calculations are those regarding discount rates, growth rates and expected changes in margins. Management estimate discount rates using pre-tax rates that reflect the current market assessment of the time value of money and the risks specific to the cash generating units. Changes in selling prices and direct costs are based on past experience and expectations of future changes in the market. Given the current economic climate, a sensitivity analysis has been performed in assessing the recoverable amounts of goodwill.

In October 2014 and 2013, impairment reviews were performed by comparing the carrying value of goodwill with the recoverable amount of the cash generating units to which goodwill has been allocated.

The pre-tax discount rates used to calculate value in use was 10.4% (2013: 6% to 12%) in respect of Agriculture and 10.4% (2013: 9% to 15%) in respect of Specialist Retail. These discount rates are derived from the Group’s weighted average cost of capital, as adjusted for the specific risks relating to each operating segment. The forecasts are extrapolated based on estimated long-term average growth rates of 0% to 3% (2013: 0% to 3%).

Management have identified a number of cash generating units within the two operating segments.

14. Intangible Assets

Group

Cost

Balance as at 1 November 2012, 31 October 2013 and 31 October 2014

Aggregate amortisation

Balance as at 1 November 2013

Amortisation charge for the period

At 31 October 2014

Net book value

At 31 October 2014

At 31 October 2013

£000

100

1

10

11

89

99


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Group

Cost

At 1 November 2012

Additions

Acquisition through business combinations

Disposals

At 31 October 2013

Additions

Reclassification

Disposals

At 31 October 2014

Depreciation

At 1 November 2012

Charge for the year


On disposals

At 31 October 2013

Charge for the year

Reclassification

On disposals

At 31 October 2014

Net book value

At 31 October 2014

At 31 October 2013

Leasehold

land and

buildings

£000

1,355

77

-

-

1,432

39

(362)

-

1,109

482

47

-

-

529

66

(76)

-

519

590

903

Freehold

land and

buildings

£000

12,269

9

-

(207)

12,071

926

362

(100)

13,259

3,513

301

-

(71)

3,743

279

76

(25)

4,073

9,186

8,328

Plant, machinery

and office

equipment

£000

18,094

1,709

113

(1,304)

18,612

1,256

-

(24)

19,844

12,152

1,207

15

(884)

12,490

1,135

-

(20)

13,605

6,239

6,122

Motor

vehicles

£000

6,035

1,221

136

(705)

6,687

834

-

(705)

6,816

3,858

967

17

(663)

4,179

1,029

-

(666)

4,542

2,274

2,508

Total

£000

37,753

3,016

249

(2,216)

38,802

3,055

-

(829)

41,028

20,005

2,522

32

(1,618)

20,941

2,509

-

(711)

22,739

18,289

17,861

The net book value of plant and machinery and motor vehicles above includes amounts of £1,655,446 (2013: £2,213,173) representing assets

held under finance leases.

15. Property, Plant and Equipment


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15. Property, Plant and Equipment (continued)


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The net book value of plant and machinery and motor vehicles above includes amounts of £nil (2013: £2,028,576) representing assets held

under finance leases.

Company

Cost

At 1 November 2012

Additions

Disposals


At 31 October 2013

Additions

Transfer to subsidiary company on hive down

Disposals

At 31 October 2014

Depreciation

At 1 November 2012

Charge for the year

On disposals


At 31 October 2013

Charge for the year

Transfer to subsidiary company on hive down

On disposals

At 31 October 2014

Net book value

At 31 October 2014

At 31 October 2013

Freehold

land and

buildings

£000

11,635

9

(207)

-

11,437

695

-

(100)

12,032

3,328

272

(71)

-

3,529

270

-

(25)

3,774

8,258

7,908

Plant, machinery

and office

equipment

£000

12,402

810

(1,276)

19

11,955

-

(11,955)

-

-

9,277

523

(856)

15

8,959

-

(8,959)

-

-

-

2,996

Motor

vehicles

£000

5,497

1,060

(624)

42

5,975

-

(5,975)

-

-

3,475

877

(614)

17

3,755

-

(3,755)

-

-

-

2,220

Total

£000

29,534

1,879

(2,107)

61

29,367

695

(17,930)

(100)

12,032

16,080

1,672

(1,541)

32

16,243

270

(12,714)

(25)

3,774

8,258

13,124


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16. Fixed Asset Investments

Group

Cost

At 1 November 2012

Additions

Share of profit /(loss) or investment income

Disposal

At 31 October 2013

Additions

Share of profit or investment income

Disposal

At 31 October 2014

Provision for impairment

At 1 November 2012, 31 October 2013 and 31

October 2014

Net book value

At 31 October 2014

At 31 October 2013

Joint

ventures

£000

2,577

40

215

(150)

2,682

343

(150)

2,875

69

2,806

2,613

Associate

£000

543

-

54

-

597

85

-

682

-

682

597

Other

unlisted

investments

£000

181

-

1

-

182

-

-

182

27

155

155

Total

£000

3,301

40

270

(150)

3,461

428

(150)

3,739

96

3,643

3,365


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16. Fixed Asset Investments (continued)

Company

Cost

At 1 November 2012

Additions or Investment income

Disposal

Transferred to goodwill

At 31 October 2013

Disposal

Transferred to subsidiary company

At 31 October 2014

Provision for impairment

At 1 November 2012 and

31 October 2013

Transferred to subsidiary company

At 31 October 2014

Net book value

At 31 October 2014

At 31 October 2013

Joint

ventures

£000

1,030

40

(150)

-

920

(150)

-

770

69

-

69

701

851

Associate

£000

48

-

-

-

48

-

-

48

-

-

-

48

48

Other

unlisted

investments

£000

175

1

-

-

176

-

(176)

-

27

(27)

-

-

149

Total

£000

19,605

807

(150)

(936)

19,326

(150)

(176)

19,000

96

(27)

69

18,931

19,230

Shares

in group

undertakings

£000

18,352

766

-

(936)

18,182

-

-

18,182

-

-

-

18,182

18,182


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17. Principal Subsidiaries, Joint Ventures and Associate

Principal subsidiaries

Subsidiary undertakings represent the following limited companies, all of which were incorporated in the UK:

Company name

Proportion of

shares held

(Ordinary)

% Nature of business

Glasson Group (Lancaster) Limited 100 Holding company

Glasson Grain Limited 100 Feed and Fertiliser merchant

Just for Pets Limited 100 Pet products retailer

Wynnstay (Agricultural Supplies) Limited 100 Agricultural merchant

Woodheads Seeds Limited 100 Seed merchants

Youngs Animal Feeds Limited 100 Equine and pet products distributor

Grainlink Limited 100 Grain merchant

Wrekin Grain Limited 100 Dormant company

Eifionydd Farmers Limited 100 Dormant company

Glasson Shipping Services Limited 100 Dormant company

Glasson Fertilisers Limited 100 Dormant company

Westhope Livestock Supplies Limited 100 Dormant company

MVZ Farm Supplies Limited 100 Dormant company

Shropshire Grain Limited 100 Dormant company

Welsh Feed Producers Limited 100 Dormant company

Pigeon Post Limited 100 Dormant company

Wynnstay Country Farmstock Limited 100 Dormant company

Petssesories Limited 100 Dormant company

C & M Transport Limited 100 Dormant company

PSB (Country Supplies) Limited 100 Non trading company

Banbury Farm and General Supplies Limited 100 Dormant company

Investments in the subsidiaries listed above are held directly by Wynnstay Group Plc, with the exception of the following which are direct

subsidiaries of the respective following companies:

Glasson Group (Lancaster) Limited

Glasson Shipping Services Limited

Glasson Grain Limited

Glasson Fertilisers Limited

Youngs Animal Feeds Limited

Eifionydd Farmers

Just for Pets Limited

Petssesories Limited


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Principal joint ventures

The above interests in joint ventures are represented by the following limited companies, all of which were incorporated in the UK:

Investments in joint ventures listed above are held directly by Wynnstay Group Plc, with the exception of Fertlink Limited which is a joint

venture with Glasson Grain Limited.

Joint ventures are accounted for using the equity method.

The aggregate amounts of the Group’s share of joint venture assets and liabilities are:

Company name Interest Nature of business

Wyro Developments Limited 50%- Ordinary Property development

Bibby Agriculture Limited 50% - Ordinary Distribution of compound animal feeds 50% - PreferenceGeogen Technologies Limited 50% - Ordinary Supplier and installation of renewable energy

Total Angling Limited 50% - Ordinary Retailer of angling products

Fertlink Limited 50% Ordinary Fertiliser blending

Revenue

Expenses

2014

£000

31,251

(30,823)

2013

£000

29,390

(29,097)

Non-current assets

Current assets

Current liabilities

Non-current liabilities

Net assets

2014

£000

1,019

5,513

(4,081)

(95)

2,356

2013

£000

969

6,184

(5,145)

(130)

1,878

Group’s share of joint ventures profit before tax

2014

£000

428

2013

£000

293

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17. Principal Subsidiaries, Joint Ventures and Associate (continued)

The aggregate amount of the Group’s share of joint venture revenue and expenses not included in these financial statements are:

The aggregate amount of the Group’s share of pre-tax profits included in these financial statements is:


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Principal associate

The above interests in associates is represented by the following limited company, which was incorporated in the UK:

Company name Interest Nature of Business

Wynnstay Fuels Limited 40% Supply of petroleum products

Summarised financial information in respect of the Group’s associate is as follows:

Total assets

Total liabilities

Net assets

Group’s share of associate net assets

Total revenue

Profit for the period

Group’s share of associate profit before tax

2014

£000

3,388

(1,806)

1,582

633

19,809

270

108

2013

£000

3,833

(2,464)

1,369

548

21,045

173

69

For the purposes of consolidation, the following periods of account have been used for each of the associated undertakings and joint ventures:

Company name Interest

Wyro Developments Limited

Wynnstay Fuels Limited

Bibby Agriculture Limited

Fertlink Limited

Geogen Technologies Limited

Total Angling Limited

31 October 2014

31 December 2013

31 August 2014

31 October 2014

31 October 2014

31 October 2014

IAS 27 “Consolidated and separate financial statements” and IAS 28 “Investments in Associates” require the use of accounting periods within

three months of the year end. Because of the other parties involved, Wynnstay Group Plc are unable to influence a change in accounting

reference date of Wynnstay Fuels Limited. In the opinion of the directors there is no material effect on the reported figures as a result of this

departure.

Transactions and balances with subsidiaries

Amounts due from subsidiary undertakings:

Trade receivables

Amounts due to subsidiary undertakings:

Trade payables

Transactions reported in the statement of

comprehensive income:

Revenue

Purchases

2014

£000

-

-

-

-

Company

2013

£000

413

1,688

3,385

13,385

Trading transactions

During the year, the Group and Company entered into the following trading transactions with subsidiaries, associates and joint ventures:


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Transactions and balances with associate

Amounts due from associated undertaking:

Trade receivables

Amounts due to associated undertaking:

Trade payables

Transactions reported in the statement of comprehensive

income:

Revenue

Purchases

2014

£000

4

4

104

104

35

545

2013

£000

4

4

64

64

45

1,066

2014

£000

-

-

-

-

-

-

2013

£000

4

4

64

64

45

1,065

Group Company

Transactions and balances with joint ventures

Amounts due from joint ventures:

Trade receivables

Loans

Amounts due to joint ventures:

Trade payables

Transactions reported in the statement of comprehensive

income:

Revenue

Purchases

Income received

2014

£000

2,082

2,802

4,884

290

290

24,919

14,507

67

2013

£000

2,215

3,067

5,282

1,078

1,078

13,729

11,321

72

2014

£000

-

2,802

2,802

-

-

-

-

-

2013

£000

1,183

3,067

4,250

55

55

1,703

273

72

Group Company

Sales of goods to related parties were made at the Group’s usual list prices, less average discounts. Purchases were made at market price

discounted to reflect the quantity of goods purchased and relationships between the parties.


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18. Business Combinations

During the year the Group completed one acquisition which was structured as an asset purchase.

On 1 October 2014 Wynnstay (Agricultural Supplies) Limited completed the purchase of the goodwill and certain assets of Mansell Powell

Supplies, a supplier of agricultural goods based in Pontrilas, Herefordshire, Powys, for an initial consideration of £154,001, consisting of

goodwill of £120,000 and stock of £20,001, paid at completion, with a further £14,000 paid for stock upon completion of valuation. Additional

contingent payments for goodwill of up to £75,000 may be paid over the next three years depending on the profitability of the acquired

enterprise. The maximum consideration for goodwill of £195,000 has been measured as the fair value of the liability.

The acquisition extends the Group’s geographic trading area and farmer customer base, as well as adding an additional outlet to the Group’s

Country Store chain.

19. Inventories

Raw materials and consumables

Finished goods and goods for resale

2014

£000

6,584

23,174

29,758

2013

£000

7,759

22,843

30,602

2014

£000

-

-

-

2013

£000

1,290

16,044

17,334

Group Company

20. Trade and Other Receivables

Current

Trade receivables

Amounts owed by group undertakings

Other receivables

Fair value of derivatives

2014

£000

45,876

-

2,598

275

48,749

2013

£000

48,858

-

2,385

28

51,271

2014

£000

-

29,891

5

-

29,896

2013

£000

29,814

6,173

832

-

36,819

Group Company

Trade receivables are stated after a provision for impairment of £910,695 (2013: £903,118) (Company £nil (2013: £459,876)).

21. Held for Sale Assets

Held for sale assets relate to a property formerly included within fixed assets but now held for resale.

Held for sale assets

2014

£000

2,372

2013

£000

2,287

2014

£000

2,372

2013

£000

2,287

Group Company


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22. Trade and Other Payables

Trade payables

Amounts owed to Group undertakings

Other taxes and social security

Other payables

Accruals and deferred income

Contingent consideration

Fair value of derivatives

2014

£000

42,160

-

783

674

2,694

365

412

47,088

2013

£000

42,260

-

672

2,646

3,273

373

114

49,338

2014

£000

-

2,783

-

45

-

339

-

3,167

2013

£000

27,975

3,798

404

586

1,519

373

-

34,655

Group Company

Current

Included within the Company’s trade payables are £nil (2013: £1,687,553) of intercompany trade creditors.

2013

£000

-

-

417

417

Other payables

Government grants

Contingent consideration

2014

£000

166

29

144

339

2013

£000

256

38

417

711

2014

£000

-

-

94

94

Group Company

Non-current

Current tax liabilities

2014

£000

678

678

2013

£000

1,221

1,221

2014

£000

13

13

2013

£000

700

700

Group Company

23. Current Tax Liabilities

24. Cash and Cash Equivalents and Bank Overdrafts

Cash and cash equivalents per balance sheet

Bank overdrafts

Cash and cash equivalents per

cash flow statement

2014

£000

8,990

(601)

8,389

2013

£000

6,636

(1,519)

5,117

2014

£000

12

-

12

2013

£000

647

-

647

Group Company


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Included within the Company’s trade payables are £nil (2013: £1,687,553) of intercompany trade creditors.

25. Financial Liabilities - Borrowings

Bank loans and overdrafts due within one year or on demand:

Secured overdrafts

Secured loans

Loan capital (unsecured)

Other loanstock (unsecured)

Net obligations under finance leases

2014

£000

601

1,979

2,580

656

16

686

3,938

2013

£000

1,519

1,940

3,459

672

17

707

4,855

2014

£000

-

1,927

1,927

656

17

-

2,600

2013

£000

-

1,840

1,840

672

17

663

3,192

Group Company

Current

Bank loans:

Secured

Net obligations under finance leases

2014

£000

1,549

1,549

751

2,300

2013

£000

3,354

3,354

915

4,269

2014

£000

1,369

1,369

-

1,369

2013

£000

3,355

3,355

882

4,237

Group Company

Non-current

After 31 August 2006 the loanstock is redeemable at par at the option of the Company. Interest at 1.5% per annum is payable to the holders of

the convertible unsecured loanstock.

The bank loans include term loans repayable by instalments as follows:

Barclays Bank Plc

HSBC Bank Plc

HSBC Bank Plc

Lombard Bank Loan

Monthly

instalment

£53,774

£52,389

£57,730

£5,111

Balance

outstanding

2014

£944,197

£1,277,277

£1,076,336

£231,433

Balance

outstanding

2013

£1,556,481

£1,869,294

£1,769,095

-

Interest

rate

2% over base rate

1.8% over base rate

2.00% over base rate

4.75% per annum

Maturity

date

May 2016

Nov 2016

June 2016

Dec 2018

These loans are secured by legal charges over certain of the Company’s freehold property.

Bank loans and overdrafts include overdrafts totalling £3,944,768 (2013: £1,519,346) relating to subsidiary companies, which are secured by

debentures over the assets of those companies.

Non-current


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25. Financial Liabilities - Borrowings (continued)


Finance lease obligations are secured on the assets to which they relate.

Borrowings are repayable as follows:

On demand or within one year

In the second year

In the third to fifth years inclusive

Over five years

Finance leases included above are repayable as follows:

On demand or within one year

In the second year

In the third to fifth years inclusive

Over five years

The net borrowings are:

Borrowings as above


Net (cash)/debt

2014

£000

3,938

1,791

509

-

6,238

686

419

332

-

1,437

6,238

(8,990)

(2,752)

2013

£000

4,855

2,487

1,782

-

9,124

707

502

413

-

1,622

9,124

(6,636)

2,488

2014

£000

2,600

1,369

-

-

3,969

-

-

-

-

-

3,969

(12)

3,957

2013

£000

3,192

2,465

1,772

-

7,429

663

480

402

-

1,545

7,429

(647)

6,782

Group Company

26. Financial Instruments

Fair values of non-derivative financial assets and financial liabilities

The fair value of current assets and current liabilities are assumed to approximate to book value due to the short-term maturity of these

instruments.

Where market values are not available, fair values of financial assets and financial liabilities have been calculated by discounting expected

future cash flows at prevailing interest rates. The fair value of current assets and current liabilities are assumed to approximate to the book

value due to the short term maturity of the instruments. The fair value of the non current borrowings have been assessed and are not deemed

to differ materially from book value.

Fair values of derivative financial assets and financial liabilities

Derivatives are used to hedge exposure to market risks, and those that are held as hedging instruments are formally designated as hedges as

defined in IAS 39. Derivatives may qualify as hedges for accounting purposes and the Group’s hedging policies are further described below.

Fair value hedges

The Group maintains futures based commodity contracts to hedge against the open long or short physical positions on its forward purchase and

sales books. Changes in the fair value of derivatives that are designated and qualify as fair value hedges are recorded in the Group Statement

of Comprehensive Income, together with any changes in the fair value of the hedged asset or liability that are attributable to the hedged risk.

The gain or loss on the hedging instrument and hedged item is recognised in the Group Statement of Comprehensive Income. If the hedge no

longer meets the criteria for hedge accounting, the adjustment to the carrying value of the hedged item is amortised to the Group Statement of

Comprehensive Income under the effective interest rate method.

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Finance lease obligations are secured on the assets to which they relate.

The Group’s derivative financial assets and liabilities that are measured at fair value at 31 October 2014, have been considered against the

following hierarchical criteria to assess their classification level:

- quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);

- inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly (that is, as

prices) or indirectly (that is, derived from prices) (Level 2); and

- inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).

All derivative financial assets and liabilities are classified as Level 1 instruments as they are valued at quoted market prices.

Risks associated with financial instruments

The main risks to which the Group is exposed are as follows:

• Market Risk

Market risk is the risk that changes in market prices, such as foreign exchange rates, interest rates and equity prices that will affect

the Group’s income or the value of its holdings of financial instruments

• Interest rate risk

While currently most of the Group’s term debt is floating base rate linked, the Board constantly review their option to fix the rates

attached to this debt through the use of Interest rate swap derivatives. Fixed rate term finance is used for the acquisition of vehicles.

• Foreign currency risk

The main currency related risk to the Group comes from the forward purchasing of imported raw materials for our Glasson Grain

business. This risk is mainly managed by entering into currency purchase agreements at the time the underlying transaction is

completed. The fair value of these contracts is not material.

As at the year end the principal amounts relating to forward purchased currency amounted to £3,655,694 (2013: £2,281,000)

• Commodity price risk

While the Group does not engage in the taking of speculative commodity positions, it does have to make significant forward

purchases of certain raw materials, particularly for use in its animal feed manufacturing activities. Position reporting systems are in

place to ensure the Board is appraised of the exposure level on a regular basis, and where possible hedging tools, primarily wheat

futures contracts on the London LIFFE market are used to manage price decisions.

• Credit risk

Credit risk is the risk of financial loss to the Group if a customer or counterparty to a financial instrument fails to meet its

contractual obligations, and arises principally from the Group’s receivables from customers and investment securities.

A significant proportion of the Group’s trade is conducted on credit terms and as such a risk of non payment is always present.

Detailed systems of credit approval before initial supply, the operation of credit limits and an active credit control policy act to

minimise this risk and historically the incidence of bad debts is low. The Group’s grain trading activities has exposed it to certain

substantial customer credit balances, and to assist in mitigating this perceived risk, a credit insurance policy has been purchased

to provide partial cover against default by certain customers.

The overdue accounts are reviewed monthly at divisional management meetings to mitigate exposure to credit risk and make

provisions accordingly.

Concentration of credit risk with respect to trade receivables is limited due to the Group’s customer base being large and unrelated.

Due to this, management believes that there is no further credit risk provision required in excess of the normal provision for

doubtful receivables. Included within the Company trade receivables are £nil (2013: £412,988) of intercompany trade debtors.

At 31 October 2014 trade receivables of £7,392,623 (2013: £7,132,000), (Company £nil (2013: £5,365,000)) were past due but were

not impaired.

These related to a number of independent customers for whom there is no recent history of default.

The aging analysis is as follows:

Up to 3 months

Over three months

2014

£000

5,954

1,439

2013

£000

5,548

1,584

2014

£000

-

-

2013

£000

4,075

1,290

Group Company

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26. Financial Instruments (continued)


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Liquidity risk

Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.

The Group has appropriate overdraft facilities in place to allow flexibility in managing liquidity.

The effective interest rates at the balance sheet dates were as follows:

Bank overdraft

Bank borrowings

Loan capital

Finance leases

2014

2.0%

2.4%

1.5%

5.9%

2013

2.2%

2.4%

1.5%

6.9%

2014

-

2.4%

1.5%

-

2013

2.0%

2.4%

1.5%

6.9%

Group Company

At 1 November

Transferred to subsidiary Company

Charge for the year

At 31 October

2014

£000

259

-

68

327

2013

£000

317

-

(58)

259

2014

£000

105

(105)

-

-

2013

£000

105

-

-

105

Group Company

The provision for deferred taxation is made up as follows:

Accelerated capital allowances

2014

£000

327

2013

£000

259

2014

£000

-

2013

£000

105

Group Company

27. Deferred Taxation

28. Share Capital

Authorised

Ordinary shares of 25p each

Allotted, called up and fully paid

Ordinary shares of 25p each

No. of shares000

40,000

19,108

£000

10,000

4,777

No. of shares000

40,000

18,850

£000

10,000

4,713

2014 2013

During the year 62,970 shares (2013: 68,488) were issued with an aggregate nominal value of £15,743 (2013: £17,122) and were fully paid up

for equivalent cash of £390,418 (2013: £333,036) to shareholders exercising their right to receive dividends under the Company’s scrip dividend

scheme.

A total of 195,282 (2013: 357,406) shares with an aggregate nominal value of £48,821 (2013: £89,352) were issued for a cash value of

£320,511 (2013: £800,994) to relevant holders exercising options in the Company. No other shares were issued for cash in this financial year

(2013: 1,682,242 shares with a nominal value of £420,560 were issued to other parties in a private share placing for a total net cash value of

£8,702,310).


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29. Share-Based Payments

The following options were exercised, lapsed and outstanding at the year end:

Exercise

Price per

share £

2.5300

0.2500

3.7500

5.4750

0.2500

2.2000

2.2000

3.4000

5.0600

Exercisable by

Sept 2013 - Aug 2018

Oct 2013 - Mar 2014

April 2015 - March 2022

Oct 2017 - Oct 2024

Oct 2017 - Mar 2018

Sept 2013 - Feb 2014

April 2015 - Sept 2015

Sept 2017 - Feb 2018

Aug 2019 - Jan 2020

As at 1

November

2013

152,450

177,000

40,000

-

-

369,450

12,273

186,829

153,717

-

352,819

722,269

(Exercised)/

Issued in

year

(110,100)

(74,679)

-

373,000

100,000

288,221

(10,351)

-

(152)

352,696

342,193

630,414

Lapsed in

year

-

(102,321)

-

-

-

(102,321)

(1,922)

(1,413)

(13,078)

(2,665)

(19,078)

(121,399)

As at

31 October

2014

42,350

-

40,000

373,000

100,000

555,350

-

185,416

140,487

350,031

675,934

1,231,284

Discretionary Share Option Schemes

Granted August 2008

Granted October 2008

Granted April 2012



Granted August 2008

Granted March 2010

Granted August 2012

Granted July 2014

Savings Related Option Schemes

During the year 184,779 (2013: 44,550) Discretionary Share Options and 10,503 (2013: 312,856) Savings Related Options were exercised and

satisfied by the allotment of new shares by the Company. The change in the number of other Savings Related Options relates to members

withdrawing from the scheme by leaving employment or closing their savings contracts.

Fair Value of Options after 7 November 2002

During the year, the Group charged £99,269 (2013: £181,647) of share based remuneration cost to its Group Statement of Comprehensive

Income based on a movement in the fair value of outstanding options granted after November 2002. The weighted average fair value of these

options were estimated by using the Black-Scholes option-pricing model and the following assumptions.

Weighted average assumptions

Share price at year end

Average share price

Exercise price

Expected volatility

Expected life

Number of options

Risk free interest rate

Number of options exercisable

2014

£5.47

£6.16

£4.10

9.43%

2.92 years

1,188,934

0.50%

42,350

2013

£6.28

£4.89

£2.17

12.6%

0.85 years

1,079,675

0.50%

341,723

The expected volatility used was the standard deviation of the daily share price over the previous year and the risk fee interest rate was based

on bank base rate at the year end.


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30. Contingent Liabilities

The Company is part of a composite banking agreement with Just for Pets Limited, Wynnstay (Agricultural Supplies) Limited and Youngs Animal

Feeds Limited.

Under the terms of the agreement the bank is authorised to offset credit balances to reduce the liabilities of the other companies included in

the agreement. At the balance sheet date the potential combined liability to the companies was £nil (2013: £nil).

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31. Capital Commitments

At 31 October 2014 the Group and Company had capital commitments as follows:

Contracts placed for future capital expenditure not provided in

the financial statements

2014

£000

598

2013

£000

95

2014

£000

-

2013

£000

68

Group Company

32. Operating Lease Commitments

Non-cancellable operating leases are payable as follows:

Group

Expiry date:

Within 1 year

Between 2 and 5 years

Over 5 years

Company

Expiry date:

Within 1 year

Between 2 and 5 years

Over 5 years

2014

£000

2,720

7,354

4,520

781

1,836

917

2013

£000

2,620

8,163

4,190

369

1,247

510

2014

£000

79

167

-

-

-

-

2013

£000

99

94

-

-

-

-

Land and buildings Other

33. Group Financial Commitments

The Group has guaranteed the overdrafts of one of its joint ventures to a maximum of £125,000 (2013: £125,000).

34. Pension Commitments

The Group operates two defined contribution pension schemes which are administered on a separate basis. The pension and associated costs

charge for the year was £789,126 (2013: £593,067). The liability owed to the pension schemes at 31 October 2014 was £74,623 (2013: £67,591).

35. Employee Share Ownership Trust

The Company operates an employee share ownership trust (ESOP). As at 31 October 2014, 10,494 ordinary 25p shares (2013: nil ordinary 25p

shares) were held by the trust with an aggregate market value of £57,402 (2013: £nil). The assets, liabilities, income and costs of the ESOP are

incorporated into the financial statements of the Group.


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36. Post Balance Sheet Event

On 12 January 2015 the Group completed the purchase of the goodwill and certain assets of Ross Feed Limited, a supplier of agricultural and

hardware goods based in Ross on Wye, Herefordshire.

Details of the estimated asset values acquired and the provisional price paid are given below, together with the previous trading performance

of the business acquired as extracted in the latest available unaudited accounts of the business.

Date of acquisition

Initial fair value of acquisition :

Plant and equipment

Inventories

Goodwill

Estimated total fair value of acquisition

Consideration paid as follows:

Net cash paid on completion

Less retention pending confirmation of Net Asset values at completion

Fair value of contingent consideration to be paid after one year

Estimated total fair value of acquisition

Fair Value

£000

19

170

312

501

365

76

60

501

12 January 2015

The final consideration to be paid is subject to confirmation of the Inventories value, and the financial performance of the acquired business in

the period from acquisition to 1 January 2016.

In line with the sale and purchase agreement the maximum contingent consideration will be £60,000.

Revenue in the year to 30 June 2014, being the latest complete information available, was £1,044,000 and profit on ordinary activities before

tax in that year was £123,000. The acquisition of the business extends the Group’s geographic trading area and farmer customer base, as well

as adding an additional outlet to the Group’s Country Store chain.

37. Related Party Transactions

During the year trading took place between the Group and a number of its Directors. All transactions were carried out on an arm’s length basis.

Transactions with Key Management Personnel

Key management personnel are considered to be Directors and their remuneration is disclosed within the Director’s Remuneration disclosure

(note 9).

J J McCarthy


Lord Carlile CBE QC

K R Greetham

D A T Evans

B P Roberts

P M Kirkham


2014

£

-

-

-

849

281,696

385

298,262

2,093,523

2,674,715

2013

£

-

-

-

222

213,469

1,034

84,686

-

299,411

31 October

2014

£

-

-

-

23

31,720

78

33,327

395,402

460,550

31 October

2013

£

-

-

-

55

25,097

61

17,020

-

42,233

Total sales Balance outstanding


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38. Cash Generated from/(used in) Operations

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Profit for the year

Adjustments for:

Tax

Dividend received

Depreciation of tangible fixed assets

Impairment of other intangible fixed assets

(Profit) on disposal of property, plant and equipment

Interest income

Interest expense

Share of results of joint ventures and associate

Share-based payments

Changes in working capital (excluding effects of

acquisitions and disposals of subsidiaries):

Decrease in short term loan to joint venture

Decrease/(increase) in inventories

Decrease/(increase) in trade and other receivables

(Decrease)/increase in payables

Cash generated from operations

2014

£000

6,697

1,796

-

2,509

10

(171)

(52)

378

(428)

99

265

844

2,522

(2,696)

11,773

2013

£000

6,171

1,850

-

2,522

-

(131)

(46)

524

(269)

182

185

(1,000)

(1,600)

4,568

12,956

2014

£000

181

123

-

270

-

(57)

-

26

-

99

265

-

1,625

(773)

1,759

2013

£000

3,212

879

(500)

1,672

-

(112)

(30)

433

-

182

185

(2,136)

(9,108)

1,351

(3,972)

Group Company


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Notice of Annual General Meeting

Notice is hereby given that the twenty third

Annual General Meeting (the “Meeting”) of

Wynnstay Group Plc (the “Company”) will be

held at The Lion Suite, Lion Quays Hotel and

Spa, Weston Rhyn, Oswestry, Shropshire, SY11

3EN on Tuesday 24 March, 2015 at 11.45 am to

transact the following business:

Ordinary Business

1. To receive and adopt the Company’s annual

accounts for the financial year ended 31

October 2014 together with the Directors’

Report and Auditor’s Report on those

accounts.

2. To declare a final dividend for the year

ended 31 October 2014.

3. To re-appoint the following Director who

retires by rotation under Article 91:

James John McCarthy


retires by rotation under Article 91:

Bryan Paul Roberts


retires under Article 86:

Howell John Richards

6. To re-appoint KPMG LLP as auditor, to hold

office from the conclusion of the Meeting

to the conclusion of the next Meeting at

which accounts are laid before the Company

at a remuneration to be determined by the

Directors.

7. To approve as an Ordinary Resolution,

that the Directors be and they are hereby

generally and unconditionally authorised

subject to the provisions set out in Article

146 (Payment of Scrip Dividends) to offer

shareholders the right to elect to receive

Ordinary Shares, credited as fully paid,

instead of the whole (or some part, to be

determined by the Board) of any dividend to

be declared during the period from the date

of this Resolution to the expiry of the fifth

anniversary of the date of this Resolution,

on such terms and conditions as the Board

may determine.

Special Business

To consider and, if thought fit, pass the

following Resolutions which will be

proposed as Special Resolutions :

8. That, the Directors be and they are hereby

generally and unconditionally authorised

for the purposes of Section 551 of the

Companies Act 2006 (the “Act”) to

exercise all powers of the Company to

allot equity securities up to an aggregate

nominal amount of £450,000 provided

that this authority shall, unless renewed,

varied or revoked by the Company in

General Meeting, expire on the earlier of

the next Annual General Meeting of the

Company and 15 months from the date

of this Resolution save that the Company

may, before such expiry, make an offer or

agreement which would or might require

relevant securities to be allotted after such

expiry, and the Directors may allot relevant

securities in pursuance of such offer or

agreement notwithstanding that the

authority conferred by this Resolution has

expired. This authority is in substitution

for all previous authorities conferred upon

the Directors pursuant to Section 80 of the

Companies Act 1985 or Section 551 of the

Companies Act 2006, but without prejudice

to the allotment of any relevant securities

already made or to be made pursuant to

such authorities.

9. That, subject to passing Resolution 8 the

Directors be and they are empowered

pursuant to Section 570 of the Act to allot

equity securities wholly for cash pursuant

to the authority conferred by the previous

Resolution as if Section 561 of the Act did

not apply to any such allotment, provided

that this power shall be limited to the

allotment of equity securities:-

(a) in connection with an offer of such

securities by way of rights to holders

of Ordinary Shares in proportion (as

nearly as may be practicable) to their

respective holdings of such shares,

but subject to such exclusions or

other arrangements as the Directors

may deem necessary or expedient in

relation to fractional entitlements

or any legal or practical problems

under the laws of any territory, or the

requirements of any regulatory body or

stock exchange; and

(b) otherwise than pursuant to sub-

paragraph (a) above up to an aggregate

nominal amount of £450,000, and shall

expire on the earlier of the next Annual

General Meeting of the Company

and 15 months from the date of this

Resolution save that the Company

may, before such expiry make an

offer or agreement which would or

might require equity securities to

be allotted after such expiry and the

Directors may allot equity securities

in pursuance of any such offer or

agreement notwithstanding that the

power conferred by this Resolution has

expired.

10. That, the Company be and is generally

and unconditionally authorised for the

purposes of Section 701 of the Act to

make one or more market purchases

(within the meaning of Section 693 of

the Act) on the London Stock Exchange

of Ordinary Shares of £0.25 each in the

capital of the Company provided that:-

(a) the maximum aggregate number

of Ordinary Shares authorised to be

purchased is 500,000 (representing

approximately 2.6% of the Company’s

issued ordinary share capital);

(b) the minimum price which may be paid

for such shares is £0.25 per share;

(c) the maximum price which may be

paid for an Ordinary Shares shall not

be more than 5% above the average

of the middle market quotations for

an ordinary share as derived from

the London Stock Exchange Daily

Official List for the five business days

immediately preceding the date on

which the ordinary share is purchased;

(d) unless previously renewed, varied

or revoked, the authority conferred

shall expire at the conclusion of the

Company’s next Annual General

Meeting or 15 months from the date of

passing this Resolution, if earlier; and

(e) the Company may make a contract or

contracts to purchase Ordinary Shares

under the authority conferred prior to

the expiry of such authority which will

or may be executed wholly or partly

after the expiry of such authority and

may make a purchase of ordinary

shares in pursuance of any such

contract or contracts.

By Order of the Board.

B P Roberts

20 January 2015

Company Secretary

Wynnstay Group Plc

Eagle House

Llansantffraid-ym-Mechain

Powys

SY22 6AQ

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Notes to the Notice of Annual General Meeting

1. Appointment of proxies

A member of the Company is entitled

to appoint a proxy to exercise all or

any of their rights to attend, speak and

vote at the Meeting. A form of proxy

accompanies this document and if it is

to be used, it must be deposited at the

Companies Head Office not less than

24 hours before the meeting. A proxy

does not need to be a member of the

Company but must attend the Meeting

to represent you.

2. Authority to continue to offer Scrip

Dividends

Under the Articles of Association of

the Company, the Directors may with

the authority of shareholders offer

the opportunity to elect to receive

scrip dividends in the form of new

Ordinary Shares instead of cash.

Ordinary resolution 7 is put forward

to allow the continuation of such

shareholder authority following the

expiry of a routine period, and simply

grants approval for the continuation

of the existing scheme for a further

five years. The Board have no plans

to alter or amend the terms or other

conditions of the operation of the

existing mandate based scheme

and all existing instructions would

be honoured on the approval of this

resolution.

3. Authority to allot shares

Special resolutions 8 and 9 are put

forward to give the Directors authority

to allot new shares (including to

those shareholders exercising their

preference to receive dividends

in the form of Scrip shares). The

resolutions limit the requested

authority to the stated maximum

as an added shareholder protection.

These authorities give the Directors

the flexibility in financing possible

business opportunities and are normal

practise for a Company of this size.

4. Authority to purchase shares

Special resolution 10 is put forward

to give the Directors the ability to buy

back and cancel existing shares if they

feel that such action would benefit all

remaining shareholders.

5. Documents on display

Copies of necessary documents will

be available for at least 15 minutes

prior to the Meeting and during the

Meeting.

6. Enquiries relating to the Meeting

Members are welcome to contact the

Company Secretary with any enquiries

relating to the Meeting or the Agenda

during normal business hours at any

time prior to the meeting. Enquiries

concerning shareholdings should be

directed to the Company’s external

registrar at the following address:

Neville Registrars, 18 Laurel Lane,

Halesowen, West Midlands, B63 3DA

(Tel. 0121 585 1131)


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21 January 2015

24 March 2015

27 March 2015

30 April 2015

June 2015

Announcement of 2014 Results

Annual General Meeting

Dividend Record Date

Payment of Final 2014 Dividends

Announcement of 2015 Interim Results


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Notes

Wynnstay Group Plc

Eagle HouseLlansantffraid

PowysSY22 6AQ

t: 01691 828512f: 01691 828690

e: [email protected]

Registered in Wales and England www.wynnstay.co.uk

wynnstay group plc annual report 2014

Documents

group pretax profits

group revenue m413

agricultural products

retail division

feed division

retail products

associate company

milliongroup pretax