26th March 2015
AGA RANGEMASTER GROUP PLC
2014 ANNUAL REPORT & ACCOUNTS
AGA Rangemaster Group plc (the "Company") has today posted or otherwise made
available to shareholders the following documents:
* Annual Report & Accounts for the year ended 31st December 2014
(`2014 Annual Report & Accounts');
* Notice of Annual General Meeting (`AGM Notice');
* Form of Proxy.
The Company's 2015 Annual General Meeting will be held at Mallory Court Hotel,
Harbury Lane, Leamington Spa, Warwickshire CV33 9QB on Thursday 30th April 2015
at 11.00am.
In accordance with Listing Rule 9.6.1R a copy of each of these documents has
been uploaded to the National Storage Mechanism and will be available for
viewing shortly at www.hemscott.com/nsm.do.
As required by Disclosure and Transparency Rule 6.3.5R, the Company confirms
that the 2014 Annual Report & Accounts and the AGM Notice are now available to
view or download in pdf format on the Company's website at
www.agarangemaster.com/investor-relations. Copies of the above documents may be
obtained directly from the Company Secretary at the Company's registered
office: AGA Rangemaster Group plc, Juno Drive, Leamington Spa, Warwickshire
CV31 3RG.
The Company's 2014 Full Year Results announcement of 6th March 2015 contained a
management report as well as the audited financial statements which were
prepared in accordance with the applicable accounting standards. The 2014
Annual Report & Accounts contains information regarding the Company's key risks
and uncertainties, related party transactions and a responsibility statement
relating to the content of the 2014 Annual Report & Accounts. An extract of
this information is provided below as required by Disclosure and Transparency
Rule 6.3.5R, however this material should be read in conjunction with and is
not a substitute for reading the full 2014 Annual Report & Accounts. Page
numbers and cross-references in the following appendices refer to page numbers
and cross-references in the 2014 Annual Report & Accounts.
APPENDICES
Appendix A: Key Risks and Uncertainties
The key risks and uncertainties are set out on pages 18 and 19 of the 2014
Annual Report & Accounts. The unedited full text relating to these disclosures
is set out below:
Key risks and uncertainties
The Group has a strong risk identification, evaluation and management process.
The effectiveness of this process is regularly reviewed by the board as are the
resultant risks and risk response plans. The Group's internal control and risk
management policies are set out on pages 30 and 31.
The following table sets out the principal risks and uncertainties that might
impact on the Group's long-term performance and could cause actual results to
differ materially from the expected and historical results. As the Group seeks
to exploit new opportunities the profile of these risks might change and new
risks, or risks that are currently deemed immaterial, may also impact the
Group's profitability and its ability to meet its targets.
RISK MITIGATION
COMPETITION/MARKET EROSION
The Group operates in a number of • We have differentiated, high quality
competitive markets and as such the products and actively invest in new
activities of our competitors can product development and design to
adversely affect the Group. maintain our position.
Competition in the market place
particularly from online retailers can • Our `built from experience' campaign
create pricing pressures. Further, the for Rangemaster highlights the quality
heavy promotion of built-in cookers differentials.
and new competitor products can impact
demand. • Constant monitoring of our market
position and competitor strategies.
A significant downwards pressure on
pricing and or a reduction in demand • Value engineering programmes assist
might impact the Group's ability to with the maintenance and enhancement
deliver its strategy and business of margin and pricing strategies
plans.
FINANCIAL COVENANTS AND FUNDING
• Our bank facilities are sufficient
The Group has bank facilities in place for our needs and do not mature until
to support its operations and to August 2016.
provide guarantees to cover future
contributions to the pension scheme. • The Group keeps its bankers
regularly informed of its progress
A breach of banking covenants might against its strategy, business plans
result in additional financial and financial covenants.
operating restrictions being placed on
the business and could have a wider • The Group focuses closely on cash
impact including that with the trustee management.
of the pension schemes.
FINANCIAL INSTRUMENTS
The Group has a global customer base • The Group's treasury policy sets the
and an international supply chain. As framework for hedging foreign exchange
such it is exposed to both foreign and interest rate risks.
exchange and interest rate risks.
Significant fluctuations can impact • The Group offsets currency flows
profitability and cash flow. internally where possible and where
appropriate puts in place foreign
exchange contracts.
GENERAL ECONOMIC CONDITIONS
The Group's operations are sensitive • The Group tracks key economic
to global economic conditions metrics for the markets in which it
particularly the consumer and housing operates. The data is used to identify
markets. Our exposure is most notable early signs of change enabling the
in the UK, the USA and France. The UK Group to adjust its strategic plans
is growing but consumer confidence and modify its investment priorities
requires a sustained period of rising on a timely basis.
household incomes to recover to
pre-downturn levels. • The Group seeks to increase
international sales and to reduce
Improved global economic conditions individual market dependency.
would bring benefits given the
operational gearing of the Group
whereas adverse conditions can result
in reduced demand for our products.
HEALTH, SAFETY AND ENVIRONMENTAL
The safety of employees, customers and • We are committed to achieving the
visitors to our premises is of highest standards. We conduct regular
critical importance. As a business audits to ensure compliance with
with a range of activities including relevant laws and regulations. We
manufacturing, retail and off site review both incidents and `near
services,the Group is exposed to a misses' to establish their root cause.
number of health and safety risks.
• We have a health and safety
The Group is committed to adhering to executive committee of the board
environmental standards set by with a focus on these aspects of the
governments and other organisations. business.
It recognises that an environmental
incident could impact on the community • Accreditation to ISO 9001:2008, ISO
in which we operate. Further, the 14001:2004 and BS OHSAS 18001:2007
environmental performance and ensures a framework is in place with
reputation of our products may affect clear policies, procedures and audits.
customer demand and the environmental
performance of our operations impact • Our product development and value
profitability and efficiency. engineering programmes help ensure
product performance is continuously
improved, taking advantage of new
and emerging technologies.
LEGAL AND REGULATORY
Compliance with laws and regulations • The Group is committed to compliance
is fundamental to the Group's success. with relevant laws and regulations and
Changes to laws and regulatory sees this compliance as central to the
requirements remain a source of both operations.
risk and opportunity throughout the
Group. In particular, changing • We monitor the legal and regulatory
regulations in the EU and the USA in environment within the
respect of the energy efficiency of countries in which we operate and
products. maintain dialogue with relevant
regulatory bodies. We take specialist
public policy advice, if required.
Management are tasked with ensuring
that employees are aware of and comply
with regulations and laws specific to
their roles.
• In respect of product regulations
our design team maintains an ongoing
development programme to ensure that
our product range remains compliant.
This programme produces ever improving
products which are also a source of
opportunity for the Group.
PENSION SCHEME FUNDING
The Group is the sponsor of a large • Following the triennial actuarial
and mature defined benefit pension valuation undertaken as at 31st
scheme and can be called on to meet December 2011 a deficit recovery plan
funding deficits and make payments was agreed and in 2012 a £16 million
under deficit recovery plans. contribution from cash held on deposit
was made. Further deficit
A formal actuarial valuation of the contributions of £4m in 2015 and
scheme is undertaken at least rising to £10m in 2016 are due to be
every three years. Such valuations made by the Group.
can reveal an increased deficit that
requires additional cash • The 2014 triennial actuarial
contributions or guarantees from the valuation is now in preparation and
Group. the Group will then discuss with the
trustee of the pension scheme any
The actuarial valuations are heavily required changes to the existing
driven by prevailing gilt yields arrangements.
which can be subject to market
distortions or affected by government • The defined benefit scheme is closed
action. As such, wide fluctuations in to new entrants and pensionable
the appraised liabilities are possible salaries were frozen in 2009/10. The
which in turn could severely constrain nature of current pension provision in
the finances of the Group. the Group is kept under review.
Deficit recovery plans need to be • Cash flows within the defined
agreed with the trustee of the pension benefit scheme are closely monitored
scheme who has to take the views and to link the requirements to pay
powers of The Pensions Regulator into pensions with cash generated from the
account. assets held.
• The Group monitors market conditions
and discusses with the trustee steps
to strengthen the corporate covenant.
• In 2014 the Group became subject to
the UK pension auto- enrolment
requirements and a new pensions
vehicle has been put in place for this
purpose.
PEOPLE
The Group requires skilled people to • The Group HR director oversees the
enable it to develop fully and exploit Group's people strategy. This includes
new opportunities both in the UK and an annual review of its succession and
overseas. A failure to recruit quality personal development plans. The board
personnel in a competitive market and is kept updated on key issues.
develop existing talent might in time
erode our competitive advantage. • Remuneration packages including
fixed, variable and long-term elements
Further, a failure to plan adequately and compensation arrangements are
for succession could also damage the regularly benchmarked to ensure the
future prospects of the Group. Group's remuneration policy remains in
line with market practice.
SUPPLY CHAIN
The Group's manufacturing operations • We closely monitor our supply chain
require the timely supply of quality and employ a range of strategies to
parts and materials. reduce reliance on individual
suppliers and minimise the impact of
Supply chain disruptions can adversely potential supplier failures.
impact the Group. Such disruptions
include the failure of key suppliers • We conduct supplier audits to assess
and environmental or industrial compliance with the terms of supply
accidents. agreements including processes,
product specifications and
Quality issues in the supply chain can manufacturing conditions.
also adversely impact the Group as
faulty or substandard parts are
unacceptable.
Appendix B: Related Party Transactions
The related party transactions are set out in note 28 to the Group accounts on
page 83 of the 2014 Annual Report & Accounts. The unedited full text relating
to these disclosures is set out below:
The Group recharges the Group pension scheme with part of the cost of
administration. The total amount recharged in the year to 31st December 2014
was £0.1m (2013: £0.1m) and this was included in the amount outstanding at the
year end of £0.2m (2013: £0.1m).
Key management's compensation
The compensation of the key management team, including executive directors, at
the balance sheet date is set out below:
2014 2013
£m £m
Salaries and short-term benefits 1.4 1.6
Post employment benefits 0.1 0.1
Share based payments - 0.1
Total emoluments to key management 1.5 1.8
Appendix C: Responsibility Statement
The 2014 Annual Report & Accounts contain a responsibility statement in
compliance with DTR 4.1.12 signed by order of the board by W B McGrath, Chief
Executive and S M Smith, Finance Director. The directors' responsibility
statement is set out on page 50 of the 2014 Annual Report & Accounts for the
Group. This statement is set out in unedited full text below. This states that
on 6th March 2015, the date of approval of the 2014 Annual Report & Accounts,
the directors confirm that to the best of their knowledge:
* the financial statements, prepared in accordance with IFRS, give a
true and fair view of the assets, liabilities, financial position
and profit of the Company and the undertakings included in the
consolidation taken as a whole; and
* the strategic report includes a fair review of the development and
performance of the business and the position of the Company and the
undertakings included in the consolidation as a whole, together with
a description of the principal risks and uncertainties they face.
The directors consider that the annual report and accounts, taken as a whole,
having taken advice from the audit and risk committee, are fair, balanced and
understandable and provides the information necessary for shareholders to
assess the Group's performance, business model and strategy.
For further information contact:
P M Sissons
Company Secretary
AGA Rangemaster Group plc
Telephone Number +44 (0)1926 455755