RWS Annual Report 2022 web - Flipbook - Page 92
Directors' Report
INTRODUCTION
The Directors present their Annual Report together with the audited consolidated
financial statements for the year ended 30 September 2022.
RESEARCH AND DEVELOPMENT
Substantial shareholdings
As at 30 September 2022, the following were
substantial shareholders:
Substantial shareholding
% holding
Andrew Brode
23.2
Liontrust Asset Management
11.7
Octopus Investments
4.5
RGM Capital
3.3
GENERAL INFORMATION
RWS Holdings plc is the ultimate parent company of the
RWS Group which operates internationally. RWS Holdings
plc is registered in England and Wales (company number
03002645). The principal activities of the Company and
its subsidiaries are described in the Strategic Report on
pages 12 to 24.
BUSINESS PERFORMANCE AND RISKS
The review of the business, operations, principal risks and
outlook is dealt with in the Strategic Report on pages 12
to 23 and 44 to 47. The key performance indicators (page
24) of the Group are revenues and adjusted pre-tax profit
before amortisation of acquired intangibles, share-based
payment expenses, acquisition costs and exceptional items.
DIVIDENDS
The Directors recommend a final dividend of 9.5 pence
per ordinary share (see note 10) to be paid on 24 February
2023 to shareholders on the register at 27 January 2023,
which, together with the interim dividend of 2.25 pence
paid in July 2022, results in a total dividend for the year of
11.75 pence (2021: 10.5 pence).
The final dividend will be reflected in the financial
statements for the year ending 30 September 2023.
The proposed total dividend per share is 1.4 times (2021:
1.0 times) covered by basic earnings per share.
RWS is constantly engaged in research and development
activities to improve the quality of the services offered to
customers and to optimise the operation of the Group.
See notes 5 and 13 for further details.
GOING CONCERN ACCOUNTING BASIS
In assessing the basis of preparation of the financial
statements for the year ended 30 September 2022, the
Directors have considered the principles of the Financial
Reporting Council’s ‘Guidance on Risk Management,
Internal Control and Related Financial and Business
Reporting, 2014’; particularly in assessing the applicability
of the going concern basis, the review period and
disclosures. The period of assessment is the 18 months
ending 31 March 2024.
As at 30 September 2022, the Group has net cash of
£25.2m comprising the Group’s US$220m revolving
credit facility (“RCF”) (£29.3m drawn at year end) and
lease liabilities of £46.7m, less cash and cash equivalents
of £101.2m. On 3 August 2022, the Group refinanced the
RCF in order to both increase the facility’s term and size.
The refinancing increased the RCF from US$120.0 million
to US$220 million and the term expiry from February
2024 to August 2026 with a one-year extension option.
The facility is provided by a consortium of banks, all of
whom participated in the modified facility, together with
2 new lenders. At year end the Group’s net leverage ratio
(as defined by the RCF agreement) is -0.11x of EBITDA,
while its interest coverage ratio (as defined by the RCF
agreement) is 64.2 of EBITDA, and are well within the
covenants permitted by the Group’s RCF agreement.
In making their going concern assessment, the Directors
have considered the Group’s current financial position
and forecast earnings and cashflows for the 18-month
period ending 31 March 2024. The business plan used
to support this going concern assessment is derived
from the Board-approved budget. The Directors have
undertaken a rigorous assessment of going concern and
liquidity considering key uncertainties and sensitivities,
the committed funding and liquidity positions under its
debt covenants and its ability to continue generating cash
from trading activities.
In light of the Group’s principal risks and uncertainties
disclosed on page 44 of the Strategic Report on the
Group’s profitability and financial position, the Directors
believe that the appropriate sensitivity in assessing the
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RWS — Annual Report 2022
GOVERNANCE REPORT
