TIDMATG
RNS Number : 3490U
Auction Technology Group PLC
02 December 2021
AUCTION TECHNOLOGY GROUP PLC
FULL YEAR RESULTS FOR THE YEARED 30 SEPTEMBER 2021
Strong operational and financial results ahead of expectations
as we continue to support the transformation of the auction
industry
London, United Kingdom, 2 December 2021 - Auction Technology
Group plc ("ATG", "the Company", "the Group") (LON: ATG), operator
of the world's leading marketplaces for curated online auctions,
reports strong financial results for the year ended 30 September
2021.
2021 Highlights
Financial results
FY21 FY20 Movement
Adjusted(1)
Aggregate revenue(1&2) GBP70.1m GBP52.3m +34%
Aggregate adjusted EBITDA(1&2) GBP31.8m GBP22.2m +43%
Aggregate adjusted EBITDA margin %(1&2) 45% 42% +3pp
Adjusted diluted earnings/(loss) per share(1) 6.6p (5.6p) +218%
Adjusted free cash flow(1) GBP30.4m GBP14.0m +117%
Adjusted net cash/(debt)(1) GBP24.6m GBP(200.4)m +112%
Reported (FY20 represents only 8.5 months
of trading)
Revenue GBP70.1m GBP35.5m +98%
Operating loss GBP(20.6)m GBP(5.0)m -312%
Loss before tax GBP(27.3)m GBP(19.0)m -44%
Basic loss per share (33.6)p (34.3)p +2%
Cash generated by operations GBP15.9m GBP6.8m +134%
Financial Highlights
-- Revenue of GBP70.1m, a 34% increase on an aggregate basis
year-on-year, with growth achieved in all six of the Group's
marketplaces
-- Adjusted EBITDA of GBP31.8m, a margin of 45%
-- Loss before tax of GBP27.3m after share-based payments
expense and charges for exceptional items, primarily related to the
IPO and acquisition of LiveAuctioneers and intangible asset
amortisation
-- Refinancing complete, with a five-year New Senior Facilities
Agreement, including a $204.0m term loan for the LiveAuctioneers
acquisition and $49.0m revolving credit facility
-- Strong cash generation, with GBP30.4m of adjusted free cash
flow in the period and a closing net cash position of GBP24.6m
Operational Highlights
-- Successful IPO, enhancing our ability to grow and lead the
transformation of the auction industry
-- Total hammer value(3) ("THV") up 31% year-on-year, to
GBP6.3bn with the attraction of new volume and verticals to
auctions further expanding options for growth
-- Online share(3) of 35%, up 2pp year-on-year; shift from live
to timed(3) auctions continuing across our marketplaces
-- Gross merchandise value(3) ("GMV") of GBP2.2bn, up 38%
year-on-year as a result of the increased THV and online share
-- Over 120m bidder sessions(3) , growth of 14% year-on-year
driven by the increasing appeal of the curated online channel and
by the range and quality of our inventory
-- Strengthened our team and technology, expanded our product and service offering
-- Acquisition of Auction Mobility during the year, and
LiveAuctioneers on 1 October 2021, transforms our capabilities,
reach and differentiation
Current trading and outlook
We delivered annual revenue growth of 34% in FY21, a fiscal year
which includes three quarters with very strong growth supported by
the shift online accelerated by COVID-19 compared to prior years'
quarters before the impact of COVID-19 had occurred and the final
quarter lapping a COVID-19 impacted quarter in FY20. In that final
quarter, including Live Auctioneers on a pro-forma basis, we saw
very encouraging revenue growth rates in the low double digits. The
new financial year has started ahead of our expectations with
positive trends continuing across our core marketplaces.
We anticipate FY22 revenue growth of high single digit to low
double digits, ahead of our original IPO guidance and analyst
consensus, and remain confident of achieving our medium-term growth
target of mid-teens plus revenue growth (pro-forma from FY19). We
expect continued improvement in our underlying operating margin but
this will be offset in FY22 by a combination of full year plc
costs, the impact of lower margin Payments revenue and an
incremental c.GBP2m of growth-focused investment. We remain
confident in achieving adjusted EBITDA margin percentages in the
mid-high 40's over the medium term.
John-Paul Savant, Chief Executive Officer of Auction Technology
Group plc, said:
"I am proud of our achievements as a newly listed company over
the past 12 months. Our success has been driven by the foundation
we have built over the last five years and by the enormous efforts
of our committed team at ATG working closely with our auctioneers,
bidders and partners, which is collectively allowing us to continue
to progress our mission of transforming the auction industry. We
delivered revenue growth of 34% and were excited to welcome Auction
Mobility and, following our financial year end, LiveAuctioneers, to
the Group. These are both examples of highly attractive
opportunities aligned with our desire to add value to our offering
for auctioneers and bidders and to enable an ambitious growth
strategy which provides additional value to all our
stakeholders.
"We are ideally placed to lead and benefit from the auction
industry's ongoing structural shift to online and increased
consumer demand for auctions, and we are focused on unlocking the
value of the curated secondary goods market. Our financial and
strategic progress reflects this compelling opportunity - we look
forward to continuing to accelerate the growth of the circular
economy and further enhancing an important channel of sustainable
commerce."
Webcast presentation
There will be a webcast presentation for analysts this morning
at 9.30am. Please contact ATG@tulchangroup.com if you would like to
attend.
For further information, please contact:
J.P. Morgan Cazenove +44 207 742 4000
(Joint corporate broker to ATG)
Bill Hutchings, James Summer, Will
Vanderspar
Numis Securities Limited +44 207 260 1000
(Joint corporate broker to ATG)
Nick Westlake, Matt Lewis, William
Baunton
Tulchan Communications +44 207 353 4200
(Public relations advisor to ATG) ATG@tulchangroup.com
Tom Murray, Sunni Chauhan, Matt Low,
Laura Marshall
ATG
For investor enquiries investorrelations@auctiontechnologygroup.com
For media enquiries press@auctiontechnologygroup.com
About Auction Technology Group plc
Auction Technology Group plc ("ATG") is the operator of the
world's leading marketplaces and auction services for curated
online auctions, seamlessly connecting bidders from around the
world to over 3,800 trusted auction houses across two major
sectors: Industrial & Commercial ("I&C") and Art &
Antiques ("A&A").
The Group powers seven online marketplaces using its proprietary
auction platform technology, hosting in excess of 70,000 live and
timed auctions each year. ATG has been supporting the auction
industry since 1971 and the Company has offices in the UK, US and
Germany.
CAUTIONARY STATEMENT The announcement may contain
forward-looking statements. These statements may relate to (i)
future capital expenditures, expenses, revenues, earnings,
synergies, economic performance, indebtedness, financial condition,
dividend policy, losses or future prospects, and (ii) developments,
expansion or business and management strategies of the Company.
Forward-looking statements are identified by the use of such terms
as "believe", "could", "should", "envisage", "anticipate", "aim",
"estimate", "potential", "intend", "may", "plan", "will" or
variations or similar expressions, or the negative thereof. Any
forward-looking statements contained in this announcement are based
on current expectations and are subject to risks and uncertainties
that could cause actual results to differ materially from those
expressed or implied by those statements. If one or more of these
risks or uncertainties materialise, or if underlying assumptions
prove incorrect, the Company's actual results may vary materially
from those expected, estimated or projected. No representation or
warranty is made that any forward-looking statement will come to
pass. Any forward-looking statements speak only as at the date of
this announcement. The Company and its directors expressly disclaim
any obligation or undertaking to publicly release any update or
revisions to any forward-looking statements contained in this
announcement to reflect any change in events, conditions or
circumstances on which any such statements are based after the time
they are made, other than in accordance with its legal or
regulatory obligations (including under the UK Listing Rules and
the Disclosure Guidance and Transparency Rules of the Financial
Conduct Authority). Nothing in this announcement shall exclude any
liability under applicable laws that cannot be excluded in
accordance with such laws.
LEI Number: 213800U8Q9K2XI3WRE39
1. The Group provides alternative performance measures ("APMs")
which are not defined or specified under the requirements of
International Financial Reporting Standards as adopted by the EU.
We believe these APMs provide readers with important additional
information on our business and aid comparability. We have included
a comprehensive list of the APMs in note 2 to the Consolidated
Financial Statements, with definitions, an explanation of how they
are calculated, why we use them and how they can be reconciled to a
statutory measure where relevant.
2. FY20 represents only an 8.5 month period to 30 September
2020. To aid comparability of the Group's results aggregate
measures have been used for the FY20 period as if the acquisitions
of the Standalone ATG and Proxibid Group had occurred on 1 October
2019. For further detail refer to note 2.
3. Refer to glossary for full definition of the terms.
CEO REVIEW
We have delivered strong operational and financial results
whilst simultaneously delivering value to auctioneers and bidders,
managing historically high levels of online auction activity across
all our marketplaces.
Overview
The past 12 months saw ATG take yet another large step in its
mission to transform the auction industry.
Before covering what we have achieved this year, I wanted to
take a moment to recognise briefly how the transformation of the
Company in FY20 enabled such a strong FY21.
In FY20, just as the pandemic hit, we bought Proxibid, a major
auction marketplace in North America. We then focused on the
extreme demands placed by COVID-19 on every aspect of ATG.
While the pandemic presented significant challenges for us, our
auctioneer customers and bidders, we were aided by the fact that
the industry had already been going through a structural shift from
offline to online for the past 15 years. The pandemic simply
accelerated this transition.
Auctioneers moved heavily into timed auctions and bidders who
used to bid online, in the room or on the phone were often given
online as the only choice. This important dynamic affected not only
our customers but our employees as well. Our team went from one in
which we worked in the office five days per week to one where we
are almost never in the office.
While this change would have been a challenge for any other
business, our team supports customers conducting events and sales
where the auction activity and bidding activity is happening in
real time. Real time support means that any glitch is felt
instantly, and quality is paramount. As auctioneers increased the
amount of their business being conducted online, the need for
robust technology and quality service was even more imperative.
The fact that our team of c.250, spread across the US, UK, and
Europe, has for the past 18 months been able to transfer so
effectively from office to home-work life while remotely supporting
almost 1,000 auctions per week on our technology, is a testament to
their dedication, ability, knowledge, and raw perseverance. Their
performance the previous year in incredibly challenging personal
and work situations is truly commendable. Their work is what
enabled us to have the FY21 we delivered.
In FY21, we delivered strong operational and financial results
whilst simultaneously managing historically high levels of online
auction activity across all our marketplaces, as well as
significant corporate events. In October 2020, we purchased Auction
Mobility, the best white label provider to the art, antiques, and
collectables sector globally. In June 2021 we announced the
proposed acquisition of LiveAuctioneers, the largest curated online
marketplace for Art & Antiques ("A&A") in North America.
This will add a massive and fast-growing new geography to our
A&A network and greatly expand both the inventory we offer and
the breadth of bidder base for auctioneers.
In February 2021, we successfully led an Initial Public Offering
("IPO") of the Company on the London Stock Exchange. The transition
to becoming a public company has given us access to capital to grow
and continue to lead the transformation of the industry; it has
enabled us to fund the purchase of LiveAuctioneers post the year
end in October 2021, with additional institutional funding; it also
gives us a more visible platform, with valuable transparency, and
demonstrates a commitment to our customers that we hold ourselves
and our strategy accountable to a public level of scrutiny. This
supports our credibility with customers as they look to choose
their online partner of the future, providing the reassurance of
our solid financial profile and giving them the confidence that we
will be able to serve them as a reliable and trusted partner for
many years to come.
Summary of operating performance
We have seen revenue increase this year, reflecting an increase
in THV, GMV, number of bidder sessions and online share. Through
our platforms, we attracted over 680,000 bidders from 160 countries
to 44,000 auctions and sold c6.0 million items on our
marketplaces.
We delivered strong financial results and added value to the
auction industry in unique circumstances.
We firmly believe that the shift online will continue as we move
into our post COVID-19 future, as we have demonstrated the
advantages that online selling and buying bring to both sides of
the marketplace.
Supporting our stakeholders
Over the last year, we focused on:
1 Supporting our customers - both auctioneers and bidders - to
enable them to keep running their businesses
2 Supporting our employees, both in terms of physical and mental health
3 Emerging from the pandemic in a stronger position than we entered it
We delivered against all of these priorities.
We supported our customers. The auction industry, across all
verticals, is moving increasingly from live auctions to timed. We
acted swiftly to facilitate this change. We invested heavily in our
client relationship management capabilities to better help
auctioneers optimise their digital marketing spend. We also
invested in tools such as our timed bidding dashboard which made it
more convenient and efficient for them to run online. For bidders,
we invested in better user experience, and kept almost 1,000
auctions up and running each week, facilitating the sale of over
GBP6bn of second-hand items in the past year. For many whose
businesses depend on buying at auction, this meant they could keep
going.
We supported our people. We supported our people with a
structured health and wellness programme that was packed with
activities each month to help people focus time on their wellbeing.
These included flexible working when needed, access to an employee
assistance and support helpline, external talks with nutritionists,
and scheduled get-togethers to keep in touch regularly. In our
annual survey, our employees rated as exceptionally positive our
response to taking care of their and their families' wellbeing this
past year.
We are emerging from the pandemic stronger than we entered it.
We grew our key financial metrics, we strengthened our team, and we
reinforced our technology. When combined with the expansion of our
bidder base, we are now undeniably more valuable to auctioneers and
to bidders than just one year ago. We successfully integrated
Proxibid operationally into the Group and enabled cross-listing on
the BidSpotter and Proxibid platforms, resulting in a higher online
share from the cross pollination of bidders. The acquisition of
Auction Mobility at the beginning of the financial year, and the
acquisition of LiveAuctioneers post the year end, will further
transform our capabilities and strengthen our position. One of the
value drivers for acquiring LiveAuctioneers is their online
payments product, which we intend to roll out in the latter half of
FY22 to ATG's North American customers and then into Europe.
The past year has transformed the industry and the value of what
we provide to auctioneers and bidders. An industry with a history
and business model thousands of years old demonstrated that the
move it had made online amidst the pandemic was truly a structural
shift, evolving with the needs and expectations of customers and
aligned with online commerce trends.
As we continue to invest in serving auctioneers and their
consignors, as well as the growing pool of bidders both
internationally and domestically, we will unlock further value in
this exciting and diverse segment of digital commerce.
Our purpose and strategic focus
We exist to unlock the value of the curated secondary goods
market for the benefit of auctioneers, buyers, and our society as a
whole. By giving millions of items second, third, and even infinite
lives, we are accelerating the growth of the circular economy and
creating a new global channel of sustainable commerce.
We connect bidders to millions of curated specialised and unique
items sold by auctioneers each year. We are changing the way
millions of people buy and sell tens of billions of pounds worth of
secondary market items by providing an integrated suite of digital
products and services that expand the capabilities and reach of
auctioneers, while presenting bidders with the best end-to-end
online bidding experience for auctions.
We are leading the transformation of the auction industry by
building close partnerships with our auctioneer customers as part
of a shared success business model and by establishing ourselves as
the most trusted and easy buying option for bidders. We use our
insight, digital expertise, technical breadth, and passion for the
auction industry to drive better outcomes for the consignors and
buyers of goods at auction. In the process, we attract more assets
to this powerful channel for accelerating the adoption of a more
circular economy.
Our vision is to be the largest curated online marketplace in
the world for secondary items traded at auction.
Our strategy for achieving this is to provide clear value to
both auctioneers and their consignors, as well as to bidders,
through an integrated product and service offering that meets the
end-to-end expectations of auctioneers and bidders alike.
For our auctioneer customers, we help auction houses achieve
target asset sale prices for their consignors by giving auction
houses access to world-leading digital marketplaces that massively
extend their audience reach. Putting them into contact with bidders
from over 160 countries around the world, generating over 120
million web sessions per year, helps auctioneers ensure that they
have maximised the number of eyeballs on each and every item they
are selling and therefore feel confident they have achieved the
maximum possible sale price for their consignor. At the same time
as driving their top line higher, our integrated offering helps
auctioneers lower their operating costs by eliminating process and
service inefficiencies and delivering high return on investment for
their marketing spend, resulting in more profitable auction
houses.
For bidders, our strategy is to enable them to benefit from the
incredible range and value available in the secondary market by
giving them access to the best and largest selection of specialised
and unique secondary market items in the world in an efficient,
trusted, and secure online marketplace environment.
Our strategy plays out through execution against six growth
levers:
(--) Extending our addressable market
(--) Growing our online share
(--) Enhancing the network effect
(--) Expanding operating leverage
(--) Growing take rate via value added services
(--) Pursuing accretive M&A
Executing on all six growth levers while running an IPO process
this year is testament to the strength of our value proposition to
auctioneers and bidders alike and the commitment and capabilities
of our team.
ESG
We believe in doing the right thing, and ESG is both at the
heart of our operations and central to our purpose. For the
environment, the auction industry plays an important role in
accelerating the growth of the circular economy, with the evolution
of online auctions supporting the market for second-hand goods. Our
services are a vital contribution towards this.
However, we acknowledge that there are environmental impacts of
our operations that we must address, which is why, as a new PLC, we
have calculated carbon emissions for which we are directly
responsible as well as carbon emissions resulting from the use of
our products. This is a vital first step to allow us to identify
our largest emission sources and therefore where we need to focus
future efforts.
For our people, we are committed to being a company where
everyone can work and thrive in a supportive environment. Our
people bring talent, energy and experience to the business and
diversity is vital to our success. In line with our mission to be a
trusted partner to our industry we support educational programmes
across auctions, technology and the markets we serve, as well as
sponsorships and partnerships that promote auctioneering, industry
standards and the trade in secondary goods.
Summary
The management team and Board are excited by the year ahead and
confident in the value we can continue to bring to the
industry.
Auctioneers are entrepreneurs at heart, and innovation in the
face of new opportunities or changing circumstances is a hallmark
of the most successful. Establishing the true market value for any
item has enabled auctions to be one of the longest-standing and
most reliable building blocks of the modern commercial economy.
For centuries, auctions have survived and thrived through
economic change, wars, the birth of the internet and now, a global
pandemic. The auction landscape has been changed forever by this
event. New bidders have been introduced to the world of auctions,
and bidders who had previously bid only in person and never
considered buying online are now using the internet like seasoned
dealmakers.
It is too early to know how many of those new bidders will keep
coming back to buy at auction and how many will remain online, but,
as with all retail-related industries, COVID-19 has accelerated the
inexorable shift towards online.
John-Paul Savant
Chief Executive Officer
CFO REVIEW
Group re-structure and presentation of results
The financial results for FY21 are presented for the year ended
30 September 2021. Prior to the Group embarking on its journey to
list on the London Stock Exchange, in February 2020 the Group
underwent a significant restructure at the same time as acquiring
the Proxibid Inc. ("Proxibid Group". Full details of the
restructure and the accounting implications are detailed in note 1
of the Consolidated Financial Statements. The reported financial
results for FY20 represent only an eight-and-a-half month period to
30 September 2020.
During the current financial year, the Group continued with its
growth strategy and acquired Auction Mobility LLC ("Auction
Mobility") on 16 October 2020 for consideration of up to GBP33.4m.
The results for Auction Mobility are included within the Auction
Services operating segment in FY21.
On 26 February 2021, the Group successfully completed its IPO on
the London Stock Exchange. Immediately prior to this, as part of
the Group's capital reorganisation, all shares held in Auction
Topco Limited, the Group's previous parent company, were
transferred to Auction Technology Group plc, a newly incorporated
parent entity, in a share for share exchange. The reorganisation
did not constitute a business combination under IFRS 3 "Business
Combinations" and therefore the Group has presented its
Consolidated Financial Statements as though the current Group
structure had been in place from the date of incorporation of
Auction Topco Limited on 13 January 2020.
The impact of the above restructures affects the comparability
of the Group's results. Therefore to aid comparisons between FY20
and FY21 alternative performance measures ("APMs") have been
presented. The prior period unaudited aggregate results have been
presented as if the acquisitions of Turner Topco Limited
("Standalone ATG") and Proxibid Group had occurred on 1 October
2019 and include the full year actual results for this period.
Note 2 of the Consolidated Financial Statements includes a full
reconciliation of all APMs presented to the reported results for
FY21 and FY20.
Revenue
FY21 FY20
GBPm GBPm Movement
---------------------------------- ----- ----- --------
Reported revenue
Arts & Antiques ("A&A") 16.2 8.4 92.9%
Industrial and Commercial ("I&C") 43.7 24.7 76.9%
---------------------------------- ----- ----- --------
Total marketplace 59.9 33.1 81.0%
Auction Services 7.1 0.8 787.5%
Content 3.1 1.6 93.8%
---------------------------------- ----- ----- --------
Total 70.1 35.5 97.5%
---------------------------------- ----- ----- --------
Aggregate revenue (unaudited)
Arts & Antiques ("A&A") 16.2 13.4 20.9%
Industrial & Commercial ("I&C") 43.7 34.6 26.3%
---------------------------------- ----- ----- --------
Total marketplace 59.9 48.0 24.8%
Auction Services 7.1 1.5 373.3%
Content 3.1 2.8 10.7%
---------------------------------- ----- ----- --------
Total 70.1 52.3 34.0%
---------------------------------- ----- ----- --------
Group
Reported revenue was GBP70.1m for the year, an increase of
97.5%, reflecting a full 12-month contribution for FY21 compared to
only eight-and-a-half months contribution for FY20. Aggregate
revenue grew 34.0%, reflecting strong performance across both the
A&A and I&C marketplace segments, which increased 24.8%
combined with the contribution from the acquisition of Auction
Mobility in FY21 within Auction Services.
Auctioneers across the Group's verticals and geographies
remained active, driving growth in THV above historical levels. In
addition, the trends accelerated by COVID-19, such as the shift to
online auctions, have continued, with the Group's online share
remaining strong in spite of the record THV growth.
Art & Antiques
Reported revenue increased by 92.9% and aggregate revenue by
20.9%. The growth in both reported and aggregate revenue was driven
by the impact of COVID-19 which has led to an acceleration of the
structural trend towards online activity. The second half of FY20
started to see the beginnings of disruption caused by the national
lockdowns as a result of COVID-19, particularly in the UK, with
some reduction in levels of auction activity. Although there have
been further periods of lockdown during FY21, the overall auction
activity has been less impacted.
FY21 has benefitted from the deferral of some activity in the
second half of FY20, which contributed to overall strong growth in
THV in the year.
Industrial & Commercial
Reported revenue increased by 76.9% and aggregate revenue by
26.3%. Revenue grew significantly in the I&C segment due to
both THV growth above historic levels and elevated online
share.
Overall levels of activity amongst our auctioneer base remained
extremely high with a high level of inventory coming to market for
sale through auction. THV growth has further benefitted from growth
in verticals which have not traditionally been a major source of
activity (for example equine and real estate). Elevated levels of
THV began in the second half of FY20 and have remained through
FY21.
I&C continued to benefit from the structural trends towards
online auctions and timed auctions which were significantly
accelerated as a result of the COVID-19 pandemic. The Group has not
seen material reversion to live auctions from auctioneers who
adopted timed auctions for the first time during the early months
of COVID-19, which were particularly prevalent in the US I&C
market.
Auction Services
The significant increase in the Group's reported and aggregate
revenue attributable to Auction Services in FY21 was due to the
acquisition of Auction Mobility on 16 October 2020. Revenue from
the Group's back-office products remained stable.
Content
There has been an increase in both reported and aggregate
revenue year on year. In the second half of FY20 there was a
significant decline in reported and aggregate revenue from
advertising fees generated by the Antiques Trade Gazette that
occurred due to the impact of the COVID-19 pandemic. During the
second half of FY21 there has been some recovery in advertising
volumes, however, overall it remains below levels achieved pre
pandemic.
Financial performance
Reported Aggregate
--------------------------------------
FY21 FY20 FY20
GBPm GBPm Movement GBPm Movement
-------------------------------------- ------ ------ -------- ------ --------
Revenue 70.1 35.5 97.5% 52.3 34.0%
Cost of sales (24.5) (15.1) 62.3% (22.3) 9.9%
-------------------------------------- ------ ------ -------- ------ --------
Gross profit 45.6 20.4 123.5% 30.0 52.0%
-------------------------------------- ------ ------ -------- ------ --------
Administrative expenses (66.5) (25.6) 159.8% (33.1) 100.9%
Other operating income 0.3 0.2 50.0% 0.2 50.0%
-------------------------------------- ------ ------ -------- ------ --------
Operating loss (20.6) (5.0) 312.0% (2.9) 610.3%
-------------------------------------- ------ ------ -------- ------ --------
Adjusted EBITDA (as defined in note
2) 31.8 15.9 100.0% 22.2 43.2%
-------------------------------------- ------ ------ -------- ------ --------
Finance income 10.4 - 100.0% - 100.0%
Finance cost (17.1) (14.0) (22.1)% (16.4) (4.3)%
-------------------------------------- ------ ------ -------- ------ --------
Net finance costs (6.7) (14.0) 52.1% (16.4) 59.1%
-------------------------------------- ------ ------ -------- ------ --------
Loss before tax (27.3) (19.0) (43.7)% (19.3) (41.5)%
Tax (expense) / credit (2.3) 2.6 (188.5)% 2.6 (188.5)%
-------------------------------------- ------ ------ -------- ------ --------
Loss for the year/period attributable
to the equity holders of the Company (29.6) (16.4) (80.5)% (16.7) (77.2)%
-------------------------------------- ------ ------ -------- ------ --------
Reported loss before tax
The Group's gross profit margin has increased to 65.1%, from the
reported margin of 57.5% in FY20. As a result of the Group's
operating model, increases in revenue largely flow through to gross
profit.
The Group's administrative expenses have increased, reflecting
the nature of the one-off events which have taken place during the
year such as the IPO and the acquisitions. Costs related to the IPO
and the acquisition of Auction Mobility and LiveAuctioneers
totalled GBP21.8m (FY20: GBP9.8m related to the acquisition of
Proxibid and the Group restructuring). These costs have been
classified as exceptional items as further detailed in note 2 of
the Consolidated Financial Statements. As the Group is now
operating in a listed environment and has continued to grow and
recruit, employee costs have increased to GBP21.3m (FY20:
GBP13.3m).
As part of the Group's IPO process shares were issued to
Directors and employees and new share option schemes were launched
post the IPO. The share-based payment expense was GBP11.9m, which
included a one off charge of GBP10.9m arising from the equity
grants made in the run up to the IPO (FY20: GBP0.3m). With the
addition of Auction Mobility, and the full year charge for previous
acquisitions, the Group's acquired intangible assets amortisation
charge has also increased to GBP13.2m (FY20: GBP7.3m).
The above all contributed to the Group's increased loss before
tax of GBP27.3m (FY20: GBP19.0m).
Adjusted EBITDA
Adjusted EBITDA and aggregate adjusted EBITDA definitions and
reconciliations to the reported results are presented in note 2 of
the Consolidated Financial Statements. Adjusted EBITDA increased by
100.0% to GBP31.8m and aggregate adjusted EBITDA increased by 43.2%
for the year ended 30 September 2021. The adjusted EBITDA margin
for FY21 was 45.4% and in FY20 was 44.8%. The Group continues to
benefit from a high operating leverage with a significant
proportion of revenue dropping through to adjusted EBITDA.
Refinancing
During the year the Group has restructured its financing
facilities. The following events took place:
- 13 October 2020, an additional loan of $75.0m was entered into
under the Old Senior Facilities Agreement, of which $33.5m was
drawn down.
- 1 March 2021, proceeds from the IPO were used to part repay
the Old Senior Facilities leaving GBP39.4m outstanding under the
facility.
- 17 June 2021, the Old Senior Facilities were repaid in full,
and the Group entered into a New Senior Facilities Agreement.
- The New Senior Facilities Agreement comprises:
- a senior term loan facility (the "New Senior Term Facility")
for $204.0m for the acquisition of LiveAuctioneers. The New Senior
Term Facility was drawn down in full on 30 September 2021 prior to
completion of the acquisition of LiveAuctioneers on 1 October 2021.
The loan will be due for repayment on 17 June 2026.
- a multi-currency revolving credit working capital facility
(the "New Revolving Credit Facility") for $49.0m. Any sums
outstanding under the New Revolving Credit Facility will be due for
repayment on 17 June 2024, subject to the optionality of two
12-month extensions. The facility had not been drawn down as at 30
September 2021.
Finance costs
Net finance costs were GBP6.7m (FY20: GBP14.0m). Finance income
of GBP10.4m (FY20: nil) related to foreign exchange gains of
GBP8.9m, largely arising from the GBP223.8m cash in escrow balance
which is held in US dollars and the GBP1.5m movement in contingent
consideration for Auction Mobility.
Finance costs of GBP17.1m (FY20: GBP14.0m) relate to interest
costs on the borrowings of GBP8.1m including the early repayment
fees for the Old Senior Facilities Agreement, GBP2.6m for amortised
finance costs and GBP6.3m interest on the preference shares. In the
prior period GBP8.9m of interest costs were incurred on the
preference shares and GBP5.0m on the Old Senior Facilities
Agreement. The preference shares were fully settled as part of the
IPO restructure.
Taxation
The overall tax charge during the year was GBP2.3m, giving an
effective tax rate of 8.5% (FY20: credit of GBP2.6m). The tax
charge for FY21 arises due to expenses incurred on the IPO and
acquisitions that were not deductible for tax purposes and changes
to future tax rates on deferred tax liabilities.
Tax uncertainties and risks are increasing for all multinational
groups which could affect the future tax rate. The Group takes a
responsible attitude to tax, recognising that it affects all our
stakeholders. The Group seeks at all times to comply with the law
in each of the jurisdictions in which we operate, and to build open
and transparent relationships with those jurisdictions' tax
authorities. The Group's tax strategy is aligned with the
commercial activities of the business, and within our overall
governance structure the governance of tax and tax risk is given
appropriate priority by the Board.
Loss per share and adjusted earnings per share
Basic loss per share was 33.6p in FY21 compared to 34.3p in
FY20. The weighted average number of shares in issue during the
period was 88.3m (FY20: 47.8m shares). Adjusted earnings per share
for FY21 was 6.6p (FY20: loss of 5.6p). A reconciliation of the
Group's basic and diluted loss per share to adjusted earnings per
share is set out in note 2 of the Consolidated Financial
Statements.
Foreign currency impact
The Group's reported performance is sensitive to movements in
both the US dollar and the euro against the British pound sterling.
The pound sterling strengthened by 7.1% against the US dollar and
0.8% on an average rate basis against the euro compared to FY20, as
shown in the table below.
Average rate Closing rate
----------
FY21 FY20 Movement FY21 FY20 Movement
---------- ---- ---- -------- ---- ---- --------
Euro 1.14 1.14 0.8% 1.16 1.10 5.2%
US dollar 1.37 1.28 7.1% 1.35 1.29 5.0%
---- ---- -------- ---- ---- --------
When comparing aggregate revenue in FY20 to FY21, changes to
currency exchange rates had an adverse impact on aggregate revenue
of GBP3.1m.
Statement of financial position
Overall net assets have increased by GBP454.9m to GBP439.5m at
30 September 2021. Total assets increased by GBP394.9m, and the
main drivers for the increase were the cash held in escrow of
GBP223.8m for the LiveAuctioneers acquisition, the draw down of the
New Senior Term Facility of GBP148.7m and the additional goodwill
in respect of Auction Mobility of GBP19.0m. Total liabilities
decreased by GBP60.0m, primarily due to the change in financing
arrangements.
Equity
The capital structure of the Group has undergone two significant
events during the year. The first was the IPO on 26 February 2021,
when the Company issued 41,239,257 ordinary shares for a cash
consideration of GBP247.4m. The second was the equity raise via a
cash-box placing for the LiveAuctioneers acquisition on 17 June
2021, whereby the Company issued 19,999,990 for a cash
consideration of GBP244.0m.
Cash flow and adjusted net debt
The Group continued to be cash generative at the operating
level. Cash generated from operations (before tax) amounted to
GBP15.9m (FY20: GBP6.8m), after incurring cash outflows of GBP19.1m
(FY20: GBP8.5m) in relation to exceptional items referred to
above.
The net cash used in investing activities during the year was
GBP27.3m (FY20: GBP182.6m) primarily driven by the acquisition of
Auction Mobility for GBP24.9m. The net cash generated from
financing activities was GBP396.1m (FY20: GBP190.5m) reflecting the
repayment of the preference shares, the Old Senior Facilities
Agreement, the draw down on the New Senior Term Facility and the
equity raises through the IPO and cash-box placing.
Adjusted net cash at 30 September 2021 stood at GBP24.6m (30
September 2020: net debt of GBP200.4m). The Group had cash in bank
of GBP173.7m (FY20: GBP14.2m) and borrowings of GBP149.0m (FY20:
GBP214.6m).
The Group's adjusted free cash flow was GBP30.4m (FY20:
GBP14.0m), a conversion rate of 95.7% (FY20: 88.0%). A
reconciliation of the Group's cash generated by operations to
adjusted free cash flow and adjusted free cash flow conversion is
set out in note 2 of the Consolidated Financial Statements.
Dividends
As outlined in our IPO prospectus, the Group sees strong growth
opportunities through organic and inorganic investments and, as
such, intends to retain any future earnings to finance such
investments. No dividends have been paid or proposed for FY21 or
FY20.
Tom Hargreaves
Chief Financial Officer
Consolidated Statement of Profit or Loss and Other Comprehensive
Income or Loss
for the year ended 30 September 2021
Year 8.5 months
ended ended
30 September 30 September
2021 2020(1)
Note GBP000 GBP000
---------------------------------------------------------- ---- ------------- -------------
Revenue 4,5 70,080 35,478
Cost of sales (24,544) (15,042)
---------------------------------------------------------- ---- ------------- -------------
Gross profit 45,536 20,436
Administrative expenses (66,506) (25,594)
Other operating income 346 179
---------------------------------------------------------- ---- ------------- -------------
Operating loss 4 (20,624) (4,979)
Finance income 6 10,394 2
Finance cost 6 (17,078) (14,002)
---------------------------------------------------------- ---- ------------- -------------
Net finance costs 6 (6,684) (14,000)
---------------------------------------------------------- ---- ------------- -------------
Loss before tax 4 (27,308) (18,979)
Tax (expense)/credit 7 (2,322) 2,591
---------------------------------------------------------- ---- ------------- -------------
Loss for the year/period attributable to the equity
holders of the Company (29,630) (16,388)
---------------------------------------------------------- ---- ------------- -------------
Other comprehensive loss for the year/period attributable
to the equity holders of the Company
Items that may subsequently be transferred to profit
and loss:
Foreign exchange differences on translation of foreign
operations (507) (440)
---------------------------------------------------------- ---- ------------- -------------
Other comprehensive loss for the year/period, net
of tax (507) (440)
---------------------------------------------------------- ---- ------------- -------------
Total comprehensive loss for the year/period attributable
to the equity holders of the Company (30,137) (16,828)
---------------------------------------------------------- ---- ------------- -------------
Loss per share p p
Basic and diluted 8 (33.6) (34.3)
---------------------------------------------------------- ---- ------------- -------------
The above results are derived from continuing operations.
(1) 8.5 months ended 30 September 2020 represents the period
from date of incorporation of Auction Topco Limited on 13 January
2020 to 30 September 2020. See note 1 for details on the Group
reorganisation.
Consolidated Statement of Financial Position
as at 30 September 2021
30 September 30 September
2021 2020
Note GBP000 GBP000
------------------------------------- ---- ------------ ------------
ASSETS
Non-current assets
Goodwill 10 141,160 124,023
Other Intangible assets 10 68,077 74,830
Property, plant and equipment 379 478
Right of use assets 12 1,401 1,924
Deferred tax asset 366 -
Trade and other receivables 85 88
------------------------------------- ---- ------------ ------------
Total non-current assets 211,468 201,343
Current assets
Trade and other receivables 9,699 8,653
Current tax asset 437 -
Cash and cash equivalents 11 397,451 14,193
------------------------------------- ---- ------------ ------------
Total current assets 407,587 22,846
------------------------------------- ---- ------------ ------------
Total assets 619,055 224,189
------------------------------------- ---- ------------ ------------
LIABILITIES
Non-current liabilities
Trade and other payables - (522)
Current tax liabilities (1,392) (1,578)
Loans and borrowings 13 (148,686) (213,444)
Lease liabilities 12 (775) (1,208)
Deferred tax liabilities (9,260) (11,588)
------------------------------------- ---- ------------ ------------
Total non-current liabilities (160,113) (228,340)
Current liabilities
Trade and other payables (17,310) (7,231)
Current tax liabilities (1,168) (2,119)
Loans and borrowings 13 (353) (1,159)
Lease liabilities 12 (657) (756)
------------------------------------- ---- ------------ ------------
Total current liabilities (19,488) (11,265)
------------------------------------- ---- ------------ ------------
Total liabilities (179,601) (239,605)
------------------------------------- ---- ------------ ------------
Net assets/(liabilities) 439,454 (15,416)
------------------------------------- ---- ------------ ------------
EQUITY
Share capital 14 12 11
Share premium 14 235,903 -
Other reserve 14 238,385 1,125
Capital redemption reserve 5 -
Share option reserve 1,649 276
Foreign currency translation reserve (947) (440)
Retained losses (35,553) (16,388)
------------------------------------- ---- ------------ ------------
Total equity 439,454 (15,416)
------------------------------------- ---- ------------ ------------
Consolidated Statement of Changes in Equity
for the year ended 30 September 2021
Foreign
Capital Share currency
Share Share Other redemption option translation Retained Total
capital premium reserve reserve reserve reserve losses equity
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
--------------------------- -------- -------- -------- ----------- -------- ------------ -------- --------
13 January 2020 - - - - - - - -
Comprehensive loss
Loss for the period - - - - - - (16,388) (16,388)
Other comprehensive loss - - - - - (440) - (440)
--------------------------- -------- -------- -------- ----------- -------- ------------ -------- --------
- - - - - (440) (16,388) (16,828)
Transactions with owners
Issue of ordinary shares 11 - 1,125 - - - - 1,136
Movement in equity-settled
share-based payments - - - - 276 - - 276
--------------------------- -------- -------- -------- ----------- -------- ------------ -------- --------
30 September 2020 11 - 1,125 - 276 (440) (16,388) (15,416)
Comprehensive loss
Loss for the year - - - - - - (29,630) (29,630)
Other comprehensive loss - - - - - (507) - (507)
--------------------------- -------- -------- -------- ----------- -------- ------------ -------- --------
- - - - - (507) (29,630) (30,137)
Transactions with owners
Issue of ordinary shares
as consideration for
a business combination,
net of transaction
costs and tax 6 235,903 237,260 - - - - 473,169
Share buyback of ordinary
shares, net of tax (5) - - 5 - - - -
Movement in equity-settled
share-based payments - - - - 1,373 - 10,401 11,774
Tax relating to items
taken directly to equity - - - - - - 64 64
--------------------------- -------- -------- -------- ----------- -------- ------------ -------- --------
30 September 2021 12 235,903 238,385 5 1,649 (947) (35,553) 439,454
--------------------------- -------- -------- -------- ----------- -------- ------------ -------- --------
Consolidated Statement of Cash Flows
for the year ended 30 September 2021
Year 8.5 months
ended ended
30 September 30 September
2021 2020
Note GBP000 GBP000
---------------------------------------------------------- ---- ------------- -------------
Cash flows from operating activities
Loss before tax (27,308) (18,979)
Adjustments for:
Amortisation of acquired intangible assets 10 13,219 7,306
Amortisation of internally generated software 10 4,576 2,843
Depreciation of property, plant and equipment 228 167
Depreciation of right of use assets 12 743 483
Share-based payment expense 15 11,892 276
Loss on disposal of property, plant and equipment - 10
Net exchange differences - (3)
Net finance costs 6 6,684 14,000
Increase in trade and other receivables (439) (1,527)
Decrease in trade and other payables 6,271 2,248
---------------------------------------------------------- ---- ------------- -------------
Cash generated by operations 15,866 6,824
Income taxes paid (6,090) (513)
---------------------------------------------------------- ---- ------------- -------------
Net cash generated from operating activities 9,776 6,311
---------------------------------------------------------- ---- ------------- -------------
Cash flows from investing activities
Acquisition of subsidiaries, net of cash acquired 9 (24,948) (181,195)
Payment for internally generated software 10 (1,956) (1,304)
Payment for property, plant and equipment (149) (81)
Payment of deferred consideration 9 (234) -
---------------------------------------------------------- ---- ------------- -------------
Net cash used in investing activities (27,287) (182,580)
---------------------------------------------------------- ---- ------------- -------------
Cash flows from financing activities
Payment of contingent consideration (492) (1,847)
Repayment of loans and borrowings (108,956) (2,697)
Repayment of preference shares (117,716) -
Proceeds from loans and borrowings 176,639 86,088
Proceeds from the issue of preference shares 714 111,859
Interest element of lease payments 12 (74) (71)
Capital element of lease payments 12 (742) (509)
Issue of new share capital, net of share issue costs 473,158 857
Interest paid (26,428) (3,187)
---------------------------------------------------------- ---- ------------- -------------
Net cash generated by financing activities 396,103 190,493
---------------------------------------------------------- ---- ------------- -------------
Cash and cash equivalents at beginning of the year/period 14,193 -
Net increase in cash and cash equivalents 378,592 14,224
Effect of foreign exchange rate changes 4,666 (31)
---------------------------------------------------------- ---- ------------- -------------
Cash and cash equivalents at the end of the year/period 397,451 14,193
---------------------------------------------------------- ---- ------------- -------------
Notes to the Consolidated Financial Statements
1. Accounting policies
While the financial information contained in this Preliminary
Announcement has been prepared in accordance with the recognition
and measurement criteria of International Accounting Standards in
conformity with the requirements of the Companies Act 2006, the
applicable legal requirements of the Companies Act 2006 and
International Financial Reporting Standards ("IFRS") adopted
pursuant to Regulation (EC) No 1606/2002 as it applies in the
European Union, this announcement does not itself contain
sufficient information to comply with IFRS.
The information for the year ended 30 September 2021 does not
constitute statutory accounts for the purposes of Section 435 of
the Companies Act 2006. A copy of the accounts for the previous
holding company Auction Topco Limited for the year ended 30
September 2020 has been delivered to the Registrar of Companies.
The auditor's report on those accounts was not qualified and did
not contain statements under Section 498(2) or 498(3) of the
Companies Act 2006. The accounts for the year ended 30 September
2021 have been audited and finalised on the basis of the financial
information presented by the Directors in this Preliminary
Statement and will be delivered to the Registrar of Companies
following the Annual General Meeting.
General information
Auction Technology Group plc (the "Company") is a company
incorporated in the United Kingdom under the Companies Act. The
Company is a public company limited by shares and is registered in
England and Wales.
Group reorganisation
On 13 February 2020, Auction Topco Limited, through its
subsidiary Auction Bidco Limited, simultaneously purchased Turner
Topco Limited and its subsidiaries ("Standalone ATG") and Proxibid
Inc. and its subsidiaries ("Proxibid Group") (together forming the
"Auction Topco Limited Group"). Prior to the acquisition of
Standalone ATG and Proxibid Group, Auction Topco Limited had no
trading activity.
On 17 February 2021, as part of the capital reorganisation, all
shares held in Auction Topco Limited were transferred to Auction
Technology Group plc, a newly incorporated parent entity, in a
share for share exchange. Following this reorganisation Auction
Technology Group plc completed an Initial Public Offering ("IPO")
on the London Stock Exchange for a proportion of its share capital.
The Company was admitted to the premium listing segment of the
Official List of the FCA and London Stock Exchange's Main Market
for listed securities effective 26 February 2021.
As there were no changes in rights or proportion of control
exercised because of the insertion of Auction Technology Group plc
on top of the existing Auction Topco Limited Group, the
reorganisation does not constitute a business combination under
IFRS 3 "Business Combinations". Following guidance from IAS 8
"Accounting Policies, Changes in Accounting Estimates and Errors",
the integration of the Company has been prepared under merger
accounting principles. This policy, which does not conflict with
IFRS, reflects the economic substance of the transaction. Under
these principles, the Group has presented the Consolidated
Financial statements of the Group as though the current Group
structure had been in place from the date of incorporation of
Auction Topco Limited. The comparative and current year
consolidated reserves of the Group are adjusted to reflect the
statutory share capital, share premium and other reserve of Auction
Technology Group plc as if it had always existed. A merger reserve
of GBP1,527,000 has been recognised in other reserves to complete
the equity position as a result of the application of merger
accounting (see note 14).
These Consolidated Financial Statements are the first full year
set of financial statements presented for the newly formed Group
and the prior period comparison is to that of the former Auction
Topco Limited Group. Although there has been a capital
reorganisation, the underlying structure of the Group is unchanged
and as such the Consolidated Statement of Profit or Loss and Other
Comprehensive Income, Consolidated Statement of Financial Position,
Consolidated Statement of Changes in Equity and Consolidated Cash
Flow Statement have been presented on a consistent basis to the
prior period.
Basis of preparation
The Consolidated Financial Statements consolidate those of the
Company and its subsidiaries (together referred to as the
"Group").
The Consolidated Financial Statements have been prepared under
the historical cost convention, except for certain financial
instruments which have been measured at fair value. The accounting
policies applied in these Consolidated Financial Statements are the
same as those applied in the most recent annual financial
statements for the predecessor group. The Group has presented its
Consolidated Financial Statements of the Group as though the
current Group structure had been in place from the date of
incorporation of Auction Topco Limited.
The following new accounting standards, amendments and
interpretations to accounting standards have been issued but these
are not mandatory for 30 September 2021 and they have not been
adopted early by the Group:
- IFRS 9, IAS 39, IFRS 7, IFRS 4 and IFRS 16: Interest Rate Benchmark Reform
- Amendment to IFRS 16: COVID-19 Related Rent Concessions beyond June 2021
- Annual Improvements to IFRS Standards 2018 -2020
- Amendments to IAS 16: Property, Plant and Equipment: proceeds before intended use
- Amendments to IFRS 3: Business Combinations: reference to conceptual framework
- IFRS 17: Insurance Contracts
- Amendments to IAS 1: Classification of liabilities as current and non-current
- IAS 37: Onerous Contracts: costs of fulfilling a contract
- IFRS 4: Extension of the temporary exemption from applying IFRS 9
- Amendments to IAS 1 and IFRS Practice Statement 2: disclosure of accounting policies
- Amendments to IAS 12: Deferred Tax related to assets and
liabilities arising from a single transaction
- Amendments to IAS 8: Definition of accounting estimates
The Directors anticipate that the adoption of planned standards
and interpretations in future periods will not have a material
impact on the financial statements of the Group.
Going concern
At 30 September 2021, the Group's adjusted net cash position,
excluding lease liabilities and cash held, was GBP24.6m and
comprise of cash and cash equivalents of GBP173.7m and loans and
borrowings of GBP149.0m.
The following changes took place after the Company was admitted
to the London Stock Exchange on 26 February 2021:
- Primary proceeds were used to, amongst other things, repay all
outstanding liabilities with financing parties except for the loans
under the Senior Facilities Agreement.
- On 1 March 2021 an Amendment and Restatement Deed resulted in
GBP39.4m (US$43.2m and GBP8.0m) left outstanding under the Old
Senior Facilities Agreement.
- As part of the proposed acquisition for LiveAuctioneers Group,
a New Senior Facilities Agreement was entered into on 17 June 2021.
The New Senior Facilities Agreement includes the following:
- US$204.0m New Senior Term Facility for the acquisition of
LiveAuctioneers Group. The New Senior Term Facility was drawn in
full immediately prior to completion of the acquisition on 1
October 2021 and will be due for repayment on 17 June 2026; and
- US$49.0m multi-currency New Revolving Credit Facility. Any
sums outstanding under the New Revolving Credit Facility will be
due for repayment on 17 June 2024, subject to the optionality of
two 12-month extensions.
- All outstanding liabilities under the Old Senior Facility
Agreement were repaid in full on 25 June 2021.
On 17 June 2021, as part of a capital raising the Company issued
19,999,990 ordinary shares of 0.01p each for a cash consideration
of GBP244.0m. The proceeds net of expenses were received and held
in escrow for the purposes of the acquisition of LiveAuctioneers
Group.
The Directors have undertaken the going concern assessment for
the Group for a minimum of 12 months from the date of signing these
financial statements. The Directors have assessed the Group's
prospects, both as a going concern and its viability longer term of
three years, which includes the LiveAuctioneers Group acquisition
on 1 October 2021 (the "Enlarged Group").
As part of the going concern review the Directors have reviewed
the Enlarged Group's forecasts and projections and assessed the
headroom on the Enlarged Group's New Facilities and the banking
covenants. This has been considered under a base case and several
plausible but severe downside scenarios, taking into consideration
the Group's principal risks and uncertainties. Even in the most
extreme downside scenario (the combination of all downside
scenarios occurring at once) modelled the Group would be able to
operate within the level of its current available debt facilities
and covenants.
As 30 September 2021 the Group has cash of GBP173.7m (excluding
the cash held in escrow) and is in a net current asset
position.
After due consideration, the Directors have concluded that there
is a reasonable expectation that the Group has adequate resources
to continue in operational existence for at least 12 months from
the date of this report. For this reason, the Directors continue to
adopt the going concern basis in preparing the Consolidated
Financial Statements for the year ended 30 September 2021.
2. Alternative performance measures
The Group uses a number of alternative performance measures
("APMs") in addition to those measures reported in accordance with
IFRS. Such APMs are not defined terms under IFRS and are not
intended to be a substitute for any IFRS measure. The Directors
believe that the APMs are important when assessing the ongoing
financial and operating performance of the Group and do not
consider them to be more important than, or superior to, their
equivalent IFRS. The APMs improve the comparability of information
between reporting periods by adjusting for factors such as one-off
items and the timing of acquisitions.
The APMs are used internally in the management of the Group's
business performance, budgeting and forecasting, and for
determining Executive Directors' remuneration and that of other
management throughout the business. The APMs are also presented
externally to meet investors' requirements for further clarity and
transparency of the Group's financial performance. Where items of
profits or costs are being excluded in an APM, these are included
elsewhere in our reported financial information as they represent
actual income or costs of the Group.
Other commentary within the CFO's Review, should be referred to
in order to fully appreciate all the factors that affect the
Group.
Adjusted EBITDA
Adjusted EBITDA is the measure used by the Directors to assess
the trading performance of the Group's businesses and is the
measure of segment profit.
Adjusted EBITDA represents profit/(loss) before taxation,
finance costs, depreciation and amortisation, share-based payment
expense and exceptional items. Adjusted EBITDA at segment level is
consistently defined but excludes central administration costs
including Directors' salaries.
The following table provides a reconciliation from loss before
tax to adjusted EBITDA:
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
----------------------------------------------------- ------------- -------------
Loss before tax (27,308) (18,979)
Adjustments for:
Net finance costs (note 6) 6,684 14,000
Amortisation of acquired intangible assets (note 10) 13,219 7,306
Amortisation of internally generated software (note
10) 4,576 2,843
Depreciation of property, plant and equipment 228 167
Depreciation of right of use assets (note 12) 743 483
Share-based payment expense (note 15) 11,892 276
Exceptional operating items 21,765 9,789
----------------------------------------------------- ------------- -------------
Adjusted EBITDA 31,799 15,885
----------------------------------------------------- ------------- -------------
The following table provides the calculation of adjusted EBITDA
margin which represents adjusted EBITDA divided by revenue:
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
---------------------------- ------------- -------------
Reported revenue (note 4,5) 70,080 35,478
Adjusted EBITDA 31,799 15,885
Adjusted EBITDA margin 45.4% 44.8%
---------------------------- ------------- -------------
The basis for treating these items as adjusting is as
follows:
Share-based payment expense
The Group issued several share awards to employees and Directors
before the IPO and operates employee share schemes. Income
statement charges relating to such schemes are significant non-cash
charges (and related expenses) and are driven by a valuation model
which references the Group's share price and future performance
expectations. The income statement charge or credit is consequently
subject to volatility and does not fully reflect current
operational performance.
Exceptional operating items
The Group applies judgement in identifying significant items of
income and expenditure that are disclosed separately from other
administrative expenses as exceptional where, in the judgement of
the Directors, they need to be disclosed separately by virtue of
their nature or size in order to obtain a clear and consistent
presentation of the Group's ongoing business performance. Such
items could include, but may not be limited to, listing costs
associated with the IPO, costs associated with business
combinations, gains and losses on the disposal of businesses,
significant reorganisation or restructuring costs and impairment of
goodwill and acquired intangible assets. Any item classified as an
exceptional item will be significant and not attributable to
ongoing operations and will be subject to specific quantitative and
qualitative thresholds set by and approved by the Directors prior
to being classified as exceptional.
The exceptional operating items are detailed below:
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
---------------------------------- ------------- -------------
Acquisition costs (13,323) (7,963)
Listing costs (8,442) -
Restructuring costs - (1,826)
---------------------------------- ------------- -------------
Total exceptional operating items (21,765) (9,789)
---------------------------------- ------------- -------------
For the year ended 30 September 2021, the Group's exceptional
operating costs are in respect of listing costs of the IPO and the
acquisition costs predominantly relating to the acquisition of
LiveAuctioneers Group (see note 17) and Auction Mobility LLC (see
note 9). These costs comprise legal, professional and other
consultancy expenditure incurred. The business has undertaken
focused acquisitive activity in the year which has been
strategically implemented to increase income, service range and
critical mass of the Group. The cash related to exceptional
operating items is GBP19,058,000 (2020: GBP8,534,000).
For the period ended 30 September 2020, acquisition costs
comprise legal, professional and incidental expenditure incurred in
relation to the acquisition of Proxibid Inc. and Turner Topco
Limited. Restructuring costs comprise costs levied for professional
advice and redundancy costs in connection with restructuring
activities.
Adjusted earnings/(losses) and adjusted diluted earnings per
share
Adjusted earnings/(losses) excludes share-based payment expense,
exceptional items (operating and finance), amortisation of acquired
intangible assets, and any related tax effects.
The basis for treating these items as adjusting is as
follows:
Amortisation of intangible assets acquired through business
combinations
The amortisation of acquired intangibles arises from the
purchase consideration of a number of separate acquisitions. These
acquisitions are portfolio investment decisions that took place at
different times and are balance sheet items that relate to M&A
activity rather than the trading performance of the business. The
adjustment comprises amortisation of acquired intangible assets -
brand, customer relationships and non-compete agreements but does
not include amortisation of acquired software.
Exceptional finance items
Exceptional finance items include foreign exchange differences
arising on the revaluation of the foreign currency loans and cash
held on escrow (restricted cash) and costs incurred on the early
repayment of loan costs. The income statement charge does not fully
reflect current operational performance.
Number of ordinary shares
The number of ordinary shares for 30 September 2021 reflects the
number of shares in issue at IPO adjusted for the dilutive effect
from non-vested/non-exercised ordinary shares granted after the IPO
through Long Term Incentive Plan awards to the Executive Directors
and other senior management. The number of ordinary shares for 30
September 2020 reflects the number of shares in issue for the
IPO.
The following table provides a reconciliation from loss after
tax to adjusted earnings/(losses):
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
--------------------------------------------------------- ------------- -------------
Loss attributable to equity shareholders of the Company (29,630) (16,388)
Adjustments for:
Amortisation of acquired intangible assets - brand,
customer relationships and non-compete agreements 9,797 5,345
Exceptional finance items (5,652) -
Share-based payment expense 11,892 276
Exceptional operating items 21,765 9,789
Tax on adjusted items (1,538) (4,583)
--------------------------------------------------------- ------------- -------------
Adjusted earnings/(losses) 6,634 (5,561)
--------------------------------------------------------- ------------- -------------
Number Number
Reported weighted average number of shares 88,248,037 47,784,365
Adjustment for: weighted average effect of shares issued
in the period up to and including the IPO 11,751,963 52,215,635
--------------------------------------------------------- ------------- -------------
Number of shares in issue at IPO 100,000,000 100,000,000
Weighted average number of shares held by the Trust (622) -
Effect of dilutive share options 128,106 -
--------------------------------------------------------- ------------- -------------
Number of ordinary shares and dilutive options at 30
September 100,127,484 100,000,000
--------------------------------------------------------- ------------- -------------
p p
--------------------------------------------------------- ------------- -------------
Adjusted diluted earnings per share (in pence) 6.6 (5.6)
--------------------------------------------------------- ------------- -------------
Aggregate revenue, adjusted EBITDA and adjusted EBITDA
margin
The Group has made certain acquisitions that have affected the
comparability of the Group's results. To aid comparisons between
FY21 and FY20 in the CFO's review, the prior period results have
been presented to include the full year results as if the
acquisitions of Turner Topco Limited ("Standalone ATG") and
Proxibid Inc. ("Proxibid Group") had occurred on 1 October 2019.
The adjustment below reflects the actual revenue, adjusted EBITDA
and adjusted EBITDA margin from Proxibid Group and Standalone ATG
for the period 1 October 2019 to 12 February 2020. These aggregate
measures will fall away after FY21.
The following table provides reconciliation of aggregate revenue
and aggregate adjusted EBITDA from reported results for the year
ended 30 September 2020:
Year ended
30 September
2020
GBP000
----------------------------------------------------- -------------
Reported revenue 35,478
Unaudited revenue from 1 October 2019 to 12 February
2020 16,828
------------------------------------------------------ -------------
Aggregate revenue (unaudited) 52,306
------------------------------------------------------ -------------
Adjusted EBITDA 15,885
Unaudited adjusted EBITDA from 1 October 2019 to 12
February 2020 6,353
------------------------------------------------------ -------------
Aggregate adjusted EBITDA (unaudited) 22,238
------------------------------------------------------ -------------
Aggregate adjusted EBITDA margin (unaudited) 42.5%
------------------------------------------------------ -------------
Adjusted net cash/(debt)
Adjusted net cash/(debt) comprises external borrowings net of
arrangement fees, cash and cash equivalents and allows management
to monitor the indebtedness of the Group. Adjusted cash/(debt)
excludes lease liabilities and cash held in escrow (restricted
cash).
30 September 30 September
2021 2020
GBP000 GBP000
---------------------------------------------------- ------------ ------------
Cash and cash equivalents excluding restricted cash
(note 11) 173,675 14,193
---------------------------------------------------- ------------ ------------
Current loans and borrowings (note 13) (353) (1,159)
Non-current loans and borrowings (note 13) (148,686) (213,444)
---------------------------------------------------- ------------ ------------
Total loans and borrowings (149,039) (214,603)
---------------------------------------------------- ------------ ------------
Adjusted net cash/(debt) 24,636 (200,410)
---------------------------------------------------- ------------ ------------
Adjusted free cash flow and adjusted free cash flow
conversion
Free cash flow represents cash flow from operations less
capitalised development costs, which include development costs in
relation to software that are capitalised when the related projects
meet the recognition criteria under IFRS for an internally
generated intangible asset. Movement in working capital is adjusted
for balances relating to exceptional items. The Group monitors its
operational efficiency with reference to operational cash
conversion, defined as free cash flow as a percentage of adjusted
EBITDA.
The Group uses adjusted cash flow measures for the same purpose
as adjusted profit measures, in order to assist readers of the
accounts in understanding the operational performance of the Group.
The two measures used are free cash flow and free cash flow
conversion. A reported free cash flow and cash conversion rate has
not been provided as it would not give a fair indication of the
Group's free cash flow and conversion performance given the high
value of exceptional items.
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
----------------------------------------------------- ------------- -------------
Adjusted EBITDA 31,799 15,885
----------------------------------------------------- ------------- -------------
Cash generated from operations 15,866 6,824
Adjustments for:
Exceptional items 21,765 9,789
Working capital from exceptional and other items (5,098) (1,255)
Additions to internally generated software (note 10) (1,956) (1,304)
Additions to property, plant and equipment (149) (81)
----------------------------------------------------- ------------- -------------
Adjusted free cash flow 30,428 13,973
----------------------------------------------------- ------------- -------------
Adjusted free cash flow conversion (%) 95.7% 88.0%
----------------------------------------------------- ------------- -------------
3. Significant judgements and key sources of estimation uncertainty
The preparation of the Group's Consolidated Financial Statements
requires the use of certain judgements, estimates and assumptions
that affect the reported amounts of assets, liabilities, income and
expenses.
Estimates and judgements are evaluated continually, and are
based on historical experience and other factors, including
expectations of future events that are believed to be reasonable
under the circumstances.
Key estimation uncertainties are the key assumptions concerning
the future and other key sources of estimation uncertainty at the
reporting date that may have a significant risk of causing a
material adjustment to the carrying amounts of assets and
liabilities within the next period. Changes in accounting estimates
may be necessary if there are changes in the circumstances on which
the estimates were based, or as a result of new information or more
experience.
Significant judgements are those that the Group has made in the
process of applying the Group's accounting policies and that have
the most significant effect on the amounts recognised in the
financial statements.
Significant judgements and key sources of estimation uncertainty
are provided below:
Estimates
Impairment of goodwill and other intangible assets
At least on an annual basis management performs a review of the
carrying values of goodwill and intangible assets.
This requires an estimate of the value in use of the
cash-generating unit ("CGU") to which the goodwill and intangible
assets are allocated. To estimate the value in use, management
estimates the expected future cash flows from the CGU and discounts
them to their present value at a determined discount rate, which is
appropriate for the country where the goodwill and intangible
assets are allocated to.
Forecasting expected cash flows and selecting an appropriate
discount rate inherently requires estimation. Sensitivity analysis
has been performed over the estimates (see note 10). The resulting
calculation is sensitive to the assumptions in respect of future
cash flows and the discount rate applied. Management considers that
the assumptions made represent their best estimate of the future
cash flows generated by the CGUs, and that the discount rate used
is appropriate given the risks associated with the specific cash
flows. Although based on the sensitivity analysis performed there
is no impairment charge to goodwill or other intangible assets, and
this estimate does not meet the definition of a key source of
estimation uncertainty as per IAS 1, it is considered appropriate
to disclose this as an area of significant estimation due to the
size of the balance and the fact that it could change as a result
of future events.
Contingent consideration arising on the acquisition of Auction
Mobility
The Group acquired Auction Mobility LLC on 16 October 2020. The
consideration comprised US$33.0m, which was paid on completion,
deferred consideration of US$0.3m and a contingent amount up to a
maximum of US$10.0m, which is payable in early 2022 subject to the
achievement of certain revenue targets. For further details please
see note 9.
Management has prepared a forecast of the expected revenue
performance and fair valued the contingent consideration using a
weighted average probability model, discounting the cash outflow to
its net present value using a risk-free rate. Forecasting expected
revenue performance inherently requires estimation and the
potential range of outcomes of the contingent consideration payable
is US$nil to US$10.0m.
Judgements
Goodwill and other intangible assets arising from business
combinations
The purchase price of an acquired company is allocated between
intangible assets and the net tangible assets of the acquired
business with the residual of the purchase price recorded as
goodwill. The determination of the value of the intangible assets
requires significant judgements and estimates to be made by the
Directors. These judgements can include, but are not limited to,
the cash flows that an asset is expected to generate in the future
and the appropriate weighted average cost of capital.
Judgement is also required in determining appropriate useful
economic lives ("UEL") of the intangible assets arising from
business combinations. Management makes this judgement on an asset
class basis and has determined that contracts with customers have a
UEL of seven to 14 years; brands have a UEL of five to 10 years;
software has a UEL of three years; and non-compete agreements have
a UEL of four years.
4 . Operating segments
Segmental information is presented in respect of the Group's
segments and reflects the Group's management and internal reporting
structure, which is used to assess both the performance of the
business and to allocate resources within the Group. The assessment
of performance and allocation of resources is focused on the
category of customer for each type of activity.
The Board has determined an operating management structure
aligned around the four core activities of the Group. Following the
acquisition of Auction Mobility during the year, a fourth operating
segment for Auction Services has been separated from the previous
three reported segments. The comparative split of segmental revenue
has been restated to separately analyse Auction Services products
previously incorporated into the A&A and I&C segments. This
change is an alignment of how the businesses are managed
internally.
The four operating segments are as follows:
- Arts & Antiques ("A&A") auction revenues: focused on
offering auction houses that specialise in the sale of arts and
antiques access to the platforms thesaleroom.com and
lot-tissimo.com. A significant part of the Group's services is
provision of the platform as a marketplace for the A&A auction
houses to sell their goods. The segment also generates earnings
through additional services such as marketing income. The Group
contracts with customers predominantly under service agreements,
where the number of auctions to be held and the service offering
differs from client to client.
- Industrial & Commercial ("I&C") auction revenues:
focused on offering auction houses that specialise in the sale of
industrial and commercial goods and machinery access to the
platforms BidSpotter.com, BidSpotter.co.uk and Proxibid.com, as
well as i-bidder.com for consumer surplus and retail returns. A
significant part of our services is provision of the platform as a
marketplace for the I&C auction houses to sell their goods. The
segment also generates earnings through additional services such as
marketing income. The Group contracts with customers predominantly
under service agreements, where the number of auctions to be held
and the service offering differs from client to client.
- Auction Services: includes revenues from the Group's auction
house back-office products with Auction Mobility and other white
label products including Wavebid.com.
- Content: focused on the Antiques Trade Gazette paper and
online magazine. The business focuses on two streams of income:
selling subscriptions to the Gazette and also selling advertising
space within the paper and online. The Directors have disclosed
information required by IFRS 8 for the Content segment despite the
segment not meeting the reporting threshold.
There are no undisclosed or other operating segments.
An analysis of the results for the year/period by reportable
segment is as follows:
Year ended 30 September 2021
Centrally
Auction allocated
A&A I&C Services Content costs Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------------------------------------- ------- -------- --------- ------- ---------- --------
Revenue 16,203 43,695 7,129 3,053 - 70,080
-------------------------------------- ------- -------- --------- ------- ---------- --------
Adjusted EBITDA (see note
2 for definition and reconciliation) 13,938 37,897 5,276 1,063 (26,375) 31,799
Amortisation of intangible
assets (note 10) (4,307) (12,321) (1,167) - - (17,795)
Depreciation of property
plant and equipment (53) (160) (6) (9) - (228)
Depreciation of right of
use assets (note 12) (259) (410) (17) (57) - (743)
Share-based payment expense
(note 15) (1,415) (3,276) (61) - (7,140) (11,892)
Exceptional items (note
2) - - (1,107) - (20,658) (21,765)
-------------------------------------- ------- -------- --------- ------- ---------- --------
Operating profit/(loss) 7,904 21,730 2,918 997 (54,173) (20,624)
Net finance costs (note
6) - - - - (6,684) (6,684)
-------------------------------------- ------- -------- --------- ------- ---------- --------
Profit/(loss) before tax 7,904 21,730 2,918 997 (60,857) (27,308)
-------------------------------------- ------- -------- --------- ------- ---------- --------
8.5 months ended 30 September 2020
Centrally
Auction allocated
A&A I&C Services Content costs Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------------------------------------- ------- ------- --------- ------- ---------- --------
Revenue 8,352 24,684 840 1,602 - 35,478
-------------------------------------- ------- ------- --------- ------- ---------- --------
Adjusted EBITDA (see note
2 for definition and reconciliation) 6,932 19,747 672 513 (11,979) 15,885
Amortisation of intangible
assets (note 10) (2,686) (7,463) - - - (10,149)
Depreciation of property
plant and equipment (36) (121) (5) (5) - (167)
Depreciation of right of
use assets (note 12) (189) (244) (10) (40) - (483)
Share-based payment expense
(note 15) - - - - (276) (276)
Exceptional items (note
2) - (4,767) - - (5,022) (9,789)
-------------------------------------- ------- ------- --------- ------- ---------- --------
Operating profit/(loss) 4,021 7,152 657 468 (17,277) (4,979)
Net finance costs (note
6) - - - - (14,000) (14,000)
-------------------------------------- ------- ------- --------- ------- ---------- --------
Profit/(loss) before tax 4,021 7,152 657 468 (31,277) (18,979)
-------------------------------------- ------- ------- --------- ------- ---------- --------
Segment assets which exclude deferred tax assets are measured in
the same way as in the financial statements. These assets are
allocated based on the operations of the segment and the physical
location of the asset.
30 September 2021 30 September 2020
-----------------
Total Additions Additions
non-current to non-current Total non-current to non-current
assets assets assets assets
GBP000 GBP000 GBP000 GBP000
----------------- ------------ --------------- ----------------- ---------------
A&A 50,433 1,714 53,448 56,310
I&C 133,320 715 147,652 155,464
Auction Services 27,218 29,511 56 70
Content 131 10 187 219
----------------- ------------ --------------- ----------------- ---------------
211,102 31,950 201,343 212,063
----------------- ------------ --------------- ----------------- ---------------
The Group has taken advantage of paragraph 23 of IFRS 8
"Operating Segments" and does not provide segmental analysis of net
assets as this information is not used by the Directors in
operational decision making or monitoring of business
performance.
5. Revenue
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
----------------------------------------- ------------- -------------
Product and customer types
A&A 16,203 8,352
I&C 43,695 24,684
Auction Services 7,129 840
Content 3,053 1,602
----------------------------------------- ------------- -------------
70,080 35,478
----------------------------------------- ------------- -------------
Primary geographical markets
United Kingdom 18,901 9,605
North America 47,773 24,116
Germany 3,406 1,757
----------------------------------------- ------------- -------------
70,080 35,478
----------------------------------------- ------------- -------------
Timing of transfer of goods and services
Point in time 62,142 32,886
Over time 7,938 2,592
----------------------------------------- ------------- -------------
70,080 35,478
----------------------------------------- ------------- -------------
The Group has recognised the following assets and liabilities
related to contracts with customers:
30 September 30 September
2021 2020
GBP000 GBP000
--------------------- ------------ ------------
Contract assets 597 784
--------------------- ------------ ------------
597 784
--------------------- ------------ ------------
Contract liabilities 1,367 575
--------------------- ------------ ------------
1,367 575
--------------------- ------------ ------------
6. Net finance costs
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
----------------------------------------------- ------------- -------------
Foreign exchange gain 8,923 -
Interest income 9 2
Movements in contingent consideration (note 9) 1,462 -
----------------------------------------------- ------------- -------------
Finance income 10,394 2
Interest on loans and borrowings (8,071) (5,014)
Movements in contingent consideration - (31)
Interest on lease liabilities (65) (71)
Interest payable on preference shares (6,328) (8,886)
Amortisation of finance costs (2,614) -
----------------------------------------------- ------------- -------------
Finance cost (17,078) (14,002)
----------------------------------------------- ------------- -------------
Net finance costs (6,684) (14,000)
----------------------------------------------- ------------- -------------
7. Taxation
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
-------------------------------------- ------------- -------------
Current tax
Current tax on loss for the year 4,566 2,174
Adjustments in respect of prior years (40) -
-------------------------------------- ------------- -------------
Total current tax 4,526 2,174
-------------------------------------- ------------- -------------
Deferred tax
Current year (3,039) (4,765)
Adjustments from change in tax rates 1,299 -
Adjustments in respect of prior years (464) -
-------------------------------------- ------------- -------------
Deferred tax (2,204) (4,765)
-------------------------------------- ------------- -------------
Tax expense/(credit) 2,322 (2,591)
-------------------------------------- ------------- -------------
The tax on the Group's loss before tax differs from the
theoretical amount that would arise using the standard tax rate
applicable to profits of the Group as follows:
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
------------------------------------------------------- ------------- -------------
Loss before tax (27,308) (18,979)
Tax at United Kingdom tax rate of 19% (2020: 19%) (5,189) (3,606)
Tax effect of:
Expenses not deductible for tax purposes 6,839 3,388
Differences in US tax rates 283 70
Deferred tax not recognised (381) 102
Adjustment to tax charge in respect of deferred tax
arising on acquisition (25) (3,218)
Adjustments to tax charge in respect of current period
deferred tax - 673
Adjustments in respect of change in tax rates 1,299 -
Adjustments in respect of prior years (504) -
------------------------------------------------------- ------------- -------------
Tax expense/(credit) 2,322 (2,591)
------------------------------------------------------- ------------- -------------
The Group's tax affairs are governed by complex local tax
regulations in the UK, US and Germany. Given the uncertainties that
could arise in the application of these regulations, judgements are
often required in determining the tax that is due. Where management
is aware of potential uncertainties in local jurisdictions, that
are judged more likely than not to result in a liability for
additional tax, a provision is made for management's best estimate
of the liability, determined with reference to similar transactions
and third-party advice. This provision at 30 September 2021
amounted to GBP1,392,000 (2020: GBP1,576,000).
Factors that may affect future tax charges
The UK Budget on 3 March 2021 announced an increase in the UK
corporation tax rate from 19% to 25% with effect from 1 April 2023.
The effect of the rate increase is reflected in the Consolidated
Financial Statements as has been substantively enacted at the
balance sheet date. The current tax expense for the year would have
been GBP5,607,000 if the expected increased rate of corporation tax
at 25% for the UK entities had applied.
8. Loss per share
Basic loss per share is calculated by dividing the loss for the
year attributable to ordinary shareholders by the weighted average
number of ordinary shares outstanding during the year, after
excluding the weighted average number of non-vested ordinary
shares.
Diluted earnings per share is calculated by dividing the loss
for the year attributable to ordinary shareholders by the weighted
average number of ordinary shares including
non-vested/non-exercised ordinary shares. During the year ended 30
September 2021, the Group awarded conditional share awards to
Directors and certain employees through an LTIP (see note 15). The
non-vested/non-exercised ordinary shares are anti-dilutive given
the loss for the year and are therefore excluded from the weighted
average number of ordinary shares for the purpose of diluted
earnings per share calculation.
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
-------------------------------------------------------- ------------- -------------
Loss attributable to equity shareholders of the Company (29,630) (16,388)
-------------------------------------------------------- ------------- -------------
As set out in note 1, a reorganisation of the Group in February
2021 has resulted in a significant change in the capital structure
of the Company. This is reflected in the weighted average numbers
of shares used in the basic loss per share calculations which are
as follows:
Number Number
Weighted average number of shares 88,248,037 47,784,365
Weighted average number of shares held by the Employee
Benefit Trust (622) -
------------------------------------------------------- ---------- ----------
Weighted average number of shares 88,247,415 47,784,365
Dilutive share options 128,106 -
------------------------------------------------------- ---------- ----------
Basic and diluted loss per share (in pence) (33.6)p (34.3)p
------------------------------------------------------- ---------- ----------
9. Acquisition of Auction Mobility LLC
On 16 October 2020, the Group acquired 100% of the equity share
capital of Auction Mobility LLC for a total maximum consideration
of $43,308,000 (equivalent to GBP33,350,000), comprising upfront
cash consideration of $33,000,000 (equivalent to GBP25,424,000),
deferred consideration of $305,000 (GBP234,000) and contingent
consideration of up to a maximum $10,000,000 (equivalent to
GBP7,692,000), subject to the performance of the acquired company
against certain targets. Auction Mobility provides a customised
auction software platform, a leading white label app and web
developer, for auction houses. The purpose of the acquisition was
to further strengthen the Group's presence in the US.
At acquisition, the Directors calculated the fair value of the
contingent consideration expected to be paid, based on a weighted
average probability model, resulting in a liability of
GBP3,918,000. The key inputs to the model were revenue growth
assumptions and percentage probability weightings applied to
forecast earn-out cash flows.
At the date of acquisition, Auction Mobility LLC had net assets
with a fair value of US$13,786,000 (equivalent to GBP10,604,000).
The acquisition accounting is set out below.
At fair
value
GBP000
-------------------------------------------------- -------
Intangible assets - software 2,786
Intangible assets - customer relationships 6,094
Intangible assets - brand 371
Intangible assets - non-compete agreement 1,286
Trade receivables 462
Other debtors and prepayments 647
Cash and cash equivalents 476
Trade payables (129)
Accruals and contract liabilities (1,389)
-------------------------------------------------- -------
Net assets on acquisition 10,604
Goodwill (note 10) 18,972
-------------------------------------------------- -------
Total consideration 29,576
-------------------------------------------------- -------
Consideration satisfied by:
Cash consideration 25,424
Contingent consideration 3,918
Deferred consideration 234
-------------------------------------------------- -------
29,576
-------------------------------------------------- -------
Net cash outflow arising on acquisition:
Cash consideration 25,424
Less: cash and cash equivalents balances acquired (476)
-------------------------------------------------- -------
24,948
-------------------------------------------------- -------
Goodwill arises as a result of the surplus of consideration over
the fair value of the separately identifiable assets acquired. The
main reason leading to the recognition of goodwill is the future
economic benefits arising from assets which are not capable of
being individually identified and separately recognised; these
include the value of the assembled workforce within the business
acquired. All of the goodwill recognised is expected to be
deductible for income tax purposes.
Acquisition costs of GBP1,107,000 directly related to the
business combination have been immediately expensed to the
Consolidated Statement of Profit or Loss as part of administrative
expenses and included within exceptional items (see note 2).
The fair value of the assets acquired includes gross trade
receivables of GBP462,000 which are expected to be fully
recoverable.
The Group's contingent consideration as at 30 September 2021
amounted to GBP2,301,000. The Group regularly performs a review of
the ongoing businesses to assess the impact of the fair value of
the contingent consideration. The change of GBP1,462,000 (2020:
GBPnil) in these fair values was reported as a finance income in
the Consolidated Statement of Profit or Loss. Exchange differences
to reserves were recorded within foreign exchange differences on
translation of foreign operations in the Consolidated Statement of
Comprehensive Profit or Loss.
Between 16 October 2020 and 30 September 2021, Auction Mobility
LLC contributed GBP5,801,000 to Group revenues and a profit of
GBP246,000 for the period ended 30 September 2021. If the
acquisition had occurred on 1 October 2020, Group revenue would
have been GBP70,326,000 and Group loss before tax would have been
GBP27,348,000.
10. Goodwill and other intangible assets
Total
acquired Internally
Customer Non-compete Intangible generated
Software relationships Brand agreement assets software Goodwill Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
-------------------------- -------- -------------- ------- ----------- ----------- ---------- -------- -------
Cost
13 January 2020 - - - - - - - -
Acquisition of business 9,373 54,429 11,283 - 75,085 8,590 124,023 207,698
Additions - - - - - 1,304 - 1,304
-------------------------- -------- -------------- ------- ----------- ----------- ---------- -------- -------
1 October 2020 9,373 54,429 11,283 - 75,085 9,894 124,023 209,002
Acquisition of business
(note 9) 2,786 6,094 371 1,286 10,537 - 18,972 29,509
Additions - - - - - 1,956 - 1,956
Exchange differences (214) (706) (228) (50) (1,198) (365) (1,835) (3,398)
-------------------------- -------- -------------- ------- ----------- ----------- ---------- -------- -------
30 September 2021 11,945 59,817 11,426 1,236 84,424 11,485 141,160 237,069
-------------------------- -------- -------------- ------- ----------- ----------- ---------- -------- -------
Amortisation and
impairment
13 January 2020 - - - - - - - -
Amortisation 1,961 4,717 628 - 7,306 2,843 - 10,149
-------------------------- -------- -------------- ------- ----------- ----------- ---------- -------- -------
1 October 2020 1,961 4,717 628 - 7,306 2,843 - 10,149
Amortisation 3,422 8,246 1,258 293 13,219 4,576 - 17,795
Exchange differences (7) (16) (6) 4 (25) (87) - (112)
-------------------------- -------- -------------- ------- ----------- ----------- ---------- -------- -------
30 September 2021 5,376 12,947 1,880 297 20,500 7,332 - 27,832
-------------------------- -------- -------------- ------- ----------- ----------- ---------- -------- -------
Net book value
1 October 2020 7,412 49,712 10,655 - 67,779 7,051 124,023 198,853
-------------------------- -------- -------------- ------- ----------- ----------- ---------- -------- -------
30 September 2021 6,569 46,870 9,546 939 63,924 4,153 141,160 209,237
-------------------------- -------- -------------- ------- ----------- ----------- ---------- -------- -------
Impairment assessments for cash-generating units ("CGUs")
containing goodwill
During the year, the goodwill in respect of each of the CGUs was
tested for impairment. The Group tests for impairment of goodwill
at the operating segment level (see note 4) representing an
aggregation of CGUs reflecting the level at which goodwill is
monitored.
The recoverable amount for CGU groups has been determined on a
value in use basis ("VIU"). The key assumptions are those regarding
the projected cash flows, the long-term growth rate and the
discount rates applied.
The carrying amount of goodwill recorded in the CGU groups and
basis of recoverable amounts are set out below:
30 September 30 September Long-term
2021 2020 Valuation growth Discount
GBP000 GBP000 method rate rate
----------------- ------------ ------------ --------- --------- --------
A&A 32,742 32,742 VIU 2.00% 9.07%
I&C 90,179 91,281 VIU 2.24% 10.12%
Auction Services 18,239 - VIU 2.24% 10.12%
----------------- ------------ ------------ --------- --------- --------
Total goodwill 141,160 124,023
----------------- ------------ ------------ --------- --------- --------
The Directors have determined the values assigned to each of the
above key assumptions as follows:
Assumption Approach
==========================================================
Estimated future are determined by reference to the budget for the year
cash flows following the balance sheet date and forecasts for the
following two years, after which a long-term perpetuity
growth rate is applied. The most recent financial budget
approved by the Board has been prepared after considering
the current economic environment in each of the Group's
markets. These projections represent the Directors' best
estimate of the future performance of these businesses.
================ ==========================================================
Long-term growth are applied after the forecast period. These are based
rates on external reports on long-term GDP growth rates for
the main markets in which each CGU operates. Therefore,
these do not exceed the long-term average growth rates
for the individual markets.
================ ==========================================================
Pre-tax discount are derived from the Group's benchmarked weighted average
rates cost of capital ("WACC"). They represent the Group's
assessment of the current market and other risks specific
to the CGUs.
================ ==========================================================
Sensitivity analysis
Sensitivity analysis has been performed based on changes to key
assumptions considered to be reasonably possible by management.
Sensitivity analysis has been performed around the key assumptions
including, reducing the long-term growth rate, increasing the
discount rates in isolation, reducing the long-term growth rate and
discount rate by 100 BPS and applying the long-term growth rate to
the FY21 cash flows which reduces the three-year CAGR. Results for
both goodwill and intangibles testing showed that the CGU was not
impaired when applying these reasonably possible sensitivity
scenarios.
11. Cash and cash equivalents
Cash and cash equivalents comprise cash at bank and in hand and
cash held in escrow.
The carrying amount of these assets approximates to their fair
value.
30 September 30 September
2021 2020
GBP000 GBP000
---------------- ------------ ------------
Cash in bank 173,675 14,193
Restricted cash 223,776 -
---------------- ------------ ------------
397,451 14,193
---------------- ------------ ------------
Cash in bank includes cash of GBP2,402,000 (2020: GBPnil) held
by the Trustee of the Group's Employee Benefit Trust relating to
pre-IPO share awards for employees. These funds are restricted and
are not available to circulate within the Group on demand.
As a result of the capital raising on 17 June 2021, the cash,
net of transaction fees associated with the acquisition and
financing of LiveAuctioneers (see note 17), was transferred to an
escrow account. These funds are restricted and are not available to
circulate within the Group on demand.
12. Leases
The Group leases assets including property, motor vehicles and
computer equipment.
The German office lease expired in July 2021 but included an
option to extend through to July 2027. For the year ended 30
September 2020, the Directors concluded that it was reasonably
certain that they would exercise the option to extend the lease
through July 2027 and had therefore accounted for the lease cost
over that period. However, during the year ended 30 September 2021
the Directors decided a more favourable location was better suited
to the business and therefore the associated right of use asset and
lease liability has been subject to modification. At 1 July 2021,
the Group entered into a new lease with an option to extend until
July 2031 which is treated as an addition. The Directors concluded
that it was reasonably certain that they would exercise their right
to extend the lease through to July 2031.
The weighted average incremental borrowing rate contracted in
2021 was 5.2% (2020: 4.2%).
Land and
buildings Computer
leasehold equipment Motor vehicles Total
GBP000 GBP000 GBP000 GBP000
----------------------------------- ---------- ---------- -------------- -------
Right of use assets
13 January 2020 - - - -
Acquisition of business 1,861 535 11 2,407
Depreciation charge for the period (342) (138) (3) (483)
----------------------------------- ---------- ---------- -------------- -------
1 October 2020 1,519 397 8 1,924
Additions 336 - - 336
Modification (79) - - (79)
Depreciation charge for the year (522) (214) (7) (743)
Exchange differences (17) (20) - (37)
----------------------------------- ---------- ---------- -------------- -------
30 September 2021 1,237 163 1 1,401
----------------------------------- ---------- ---------- -------------- -------
Lease liabilities
13 January 2020 - - - -
Acquisition of business 1,886 545 20 2,451
Interest charge for the period 57 13 1 71
Lease payments (416) (149) (15) (580)
Exchange differences 11 11 - 22
----------------------------------- ---------- ---------- -------------- -------
1 October 2020 1,538 420 6 1,964
Additions 336 - - 336
Modification (88) - - (88)
Interest charge for the year 60 13 1 74
Lease payments (575) (234) (7) (816)
Exchange differences (18) (20) - (38)
----------------------------------- ---------- ---------- -------------- -------
30 September 2021 1,253 179 - 1,432
----------------------------------- ---------- ---------- -------------- -------
Current 481 176 - 657
Non-current 772 3 - 775
----------------------------------- ---------- ---------- -------------- -------
30 September 2021 1,253 179 - 1,432
----------------------------------- ---------- ---------- -------------- -------
The charge recognised in the Consolidated Statement of Profit or
Loss for the year/period was as follows:
Year 8.5 months
ended ended
30 September 30 September
2021 2020
GBP000 GBP000
--------------------------------------------------- ------------- -------------
Depreciation charge (743) (483)
Interest charge including net gain on modification (65) (71)
--------------------------------------------------- ------------- -------------
(808) (554)
--------------------------------------------------- ------------- -------------
At 30 September 2021, there was GBPnil (2020: GBPnil) of
non-cancellable commitments relating to short-term leases. There
were GBPnil (2020: GBPnil) low-value lease commitments.
13. Loans and borrowings
The carrying amount of loan and borrowings classified as
financial liabilities at amortised cost approximates to their fair
value.
30 September 30 September
2021 2020
GBP000 GBP000
------------------------ ------------ ------------
Current
Secured bank loan - 789
Unsecured loan notes 353 370
------------------------ ------------ ------------
353 1,159
------------------------ ------------ ------------
Non-current
Secured bank loan 148,686 77,754
Preference shares - 125,414
Subordinated loan notes - 9,947
Unsecured loan notes - 329
------------------------ ------------ ------------
148,686 213,444
------------------------ ------------ ------------
149,039 214,603
------------------------ ------------ ------------
On 13 October 2020, new parties added to the Old Senior
Facilities Agreement, were entered with Macquarie and Sixth Street
for US$75.0m, of which US$33.5m (equivalent of GBP25.7m) was drawn
at this date. The loan carried an effective rate of interest of
EURIBOR+6.5% payable half yearly and was secured on the assets of
the Group.
Primary proceeds from the IPO were used to, amongst other
things, repay all outstanding liabilities with financing parties
except for the Old Senior Facilities Agreement and current
unsecured loan notes.
An Amendment and Restatement Deed under the Old Senior
Facilities Agreement effective from 1 March 2021 resulted in
GBP39.4m (US$43.2m and GBP8.0m) available under the facility. The
loan, net of loan arrangement fees of GBP1.4m, was repayable on 10
February 2027.
The Group entered into a New Senior Facilities Agreement on 17
June 2021 which included:
- a senior term loan facility (the "New Senior Term Facility")
for US$204.0m for the acquisition of LiveAuctioneers. The New
Senior Term Facility was drawn down in full on 30 September 2021
prior to completion of the acquisition of LiveAuctioneers on 1
October 2021. The loan will be due for repayment on 17 June
2026.
- a multi-currency revolving credit working capital facility
(the "New Revolving Credit Facility") for US$49.0m. Any sums
outstanding under the New Revolving Credit Facility will be due for
repayment on 17 June 2024, subject to the optionality of two
12-month extensions. The facility had not been drawn down as at 30
September 2021.
The New Senior Facilities Agreement contains an adjusted net
leverage covenant which tests the ratio of adjusted net debt
against Adjusted EBITDA and an interest cover ratio which tests the
ratio of adjusted EBITDA against net finance charges, in each case,
as at the last date of each financial quarter, commencing with the
financial quarter ending 30 September 2021.
On 25 June 2021, the Group repaid all outstanding indebtedness
in relation to the Old Senior Facilities Agreement and all
facilities thereunder were cancelled. The security provided by the
Group in connection with the Old Senior Facilities Agreement was
also released.
14. Share capital
30 September 30 September
2021 2020
GBP000 GBP000
----------------------------------------------------------- ------------ ------------
Allotted, called up and fully paid
119,999,990 ordinary shares at 0.01p each (2020: 1,052,743
ordinary share at 0.1 p each) 12 11
----------------------------------------------------------- ------------ ------------
12 11
----------------------------------------------------------- ------------ ------------
As detailed in note 1, the Group completed a capital
reorganisation during February 2021. The issued share capital as at
30 September 2021 represents the authorised share capital of
Auction Technology Group plc. The Company was incorporated on 18
January 2021 to act as the holding company for the Group and issued
one ordinary share of 0.1p at GBP1. On 25 January 2021 the Company
issued 50,000 non-voting redeemable preference shares with a
nominal value of GBP1.00 each. On 17 February 2021, the Company
issued 1,083,793 ordinary shares of 0.1p each with an aggregate
nominal value of GBP10,838 following the share for share exchange
for the entire share capital of Auction Topco Limited.
The issued share capital as at 30 September 2020 represents the
authorised share capital of Auction Topco Limited and the share
premium as at 30 September 2020 has been restated in the other
reserve to reflect the reorganisation as a result of the
application of merger accounting.
The movements in share capital, share premium and other reserve
are set out below:
Number Share Share Other
of capital premium reserve
shares GBP000 GBP000 GBP000
-------------------------------------------- ------------ -------- -------- --------
13 January 2020 1 - - -
Shares issued for grant of pre-IPO share
awards 1,052,742 11 - 1,125
-------------------------------------------- ------------ -------- -------- --------
1 October 2020 1,052,743 11 - 1,125
Shares issued for grant of pre-IPO share
awards and pre-admission awards 41,834 - - 402
Share buyback (10,783) - - -
Capital reorganisation
- Subdivision of shares creating 97,994,100
shares at 0.01p each 97,014,159 - - -
- Share buyback (39,337,210) (5) - -
- Shares issued for IPO 41,239,257 4 247,431 -
Shares issued for business combination 19,999,990 2 - 243,998
Share issue costs - - (11,528) (7,140)
-------------------------------------------- ------------ -------- -------- --------
30 September 2021 119,999,990 12 235,903 238,385
-------------------------------------------- ------------ -------- -------- --------
From 1 October 2020 to 17 February 2021, the Group issued 41,834
share awards. On 17 February 2021 a purchase for cancellation of
10,783 ordinary shares of GBP0.01p was cancelled. The aggregate
nominal values of the shares cancelled was GBP107.83.
On 26 February 2021, the capital reorganisation comprised:
- the ordinary shares were subdivided such that the number of
ordinary shares increased by 100 and the nominal value of shares
decreased from 0.1p to 0.01p.
- the Company completed the purchase for cancellation of
39,233,357 ordinary shares of 0.01p each and 103,853 ordinary
shares of 0.1p for cash consideration of GBP2. The aggregate
nominal value of the shares cancelled was GBP4,962.
- the Company repurchased and cancelled the 50,000 redeemable
preference shares of GBP1.00 at nominal value.
- in connection with the IPO, the Company issued 41,239,257
ordinary shares of 0.01p each with an aggregate nominal value of
GBP4,124 for a cash consideration of GBP247,435,000.
On 17 June 2021, as part of a capital raising, the Company
issued 19,999,990 ordinary shares of 0.01p each with an aggregate
nominal value of GBP2,000 for a cash consideration of
GBP244,000,000.
Other reserve
The other reserve comprised:
- a merger reserve that arose on the Group reorganisation and is
the adjustment of the comparative and current year consolidated
reserves of the Group to reflect the statutory share capital and
share premium of Auction Technology Group plc as if it had always
existed.
- share premium, net of share issue costs, was recognised in the
other reserve in accordance with section 612 of the Companies Act
2006 for the equity raise on 17 June 2021 was via a cash-box
placing.
15. Share-based payments
The Group had two share-based payment plans in effect in the
2021 financial year, of which one was in place prior to Admission
on the London Stock Exchange. After Admission on the London Stock
Exchange, the Company adopted a discretionary share plan called the
Auction Technology Group plc Long Term Incentive Plan (the
"LTIP").
Shares awards pre-IPO including pre-admission awards
From 1 October 2020 to 17 February 2021, the Group issued the
following pre-IPO share awards:
- 6,500 Auction Topco Limited B Ordinary shares to certain
employees.
- 16,260 Auction Topco Limited A Ordinary shares to certain
Non-Executive Directors.
- 8,097 Auction Topco Limited B Ordinary shares to the ATG
Employee Benefit Trust for the benefit of certain employees as a
staff gift and payment of associated tax liabilities for share
awards issued to employees and Executive Directors.
From 1 October 2020 to 17 February 2021, the Group issued the
following pre-admission share awards:
- 10,977 Auction Topco Limited B Ordinary shares to the
Executive Directors and certain employees.
From 13 January 2020 to 17 February 2021, 231,293 ordinary
shares in Auction Topco Limited, including the share awards
detailed above, have been issued to its employees and Non-Executive
Directors. As part of the Group reorganisation described in note 1
and 14 the ordinary shares in Auction Topco Limited were exchanged
in a share for share exchange with Auction Technology Group plc,
subdivided such that the number of ordinary shares increased by 100
to 23,129,300 and reduced by 9,627,043 shares as part of the share
buyback. This resulted in 13,502,257 ordinary shares listed in the
IPO.
The holders were subject to a service condition and, as such,
the shares represent remuneration for service thereby constituting
an IFRS 2 equity-settled, share-based arrangement. In addition, the
pre-admission awards are subject to a three-year holding period
subject to the recipient's continued employment. In January 2021,
the Group made an announcement to pursue an IPO on the London Stock
Exchange. As a result, a share-based payment expense was recognised
in the Statement of Profit or Loss, being the fair value of the
awards at their respective grant dates. The pre-IPO share awards
vested on the date of the IPO. The fair value charge in the year to
30 September 2021 for the pre-IPO awards is GBP10,124,000 (2020:
GBP276,000) and the pre-admission awards is GBP795,000 (2020:
GBPnil).
LTIP options
On admission to the London Stock Exchange on 26 February 2021,
the Company granted conditional nil-cost share options over 437,665
shares through the LTIP to the Executive Directors and other senior
management. A further 59,859 and 4,720 were granted on 5 April 2021
and 5 July 2021 respectively to senior management. It is expected
that these awards will normally vest over a three-year period
subject to the recipient's continued employment at the date of
vesting and, for Executive Directors, the satisfaction of
performance conditions to be measured over three financial years.
The fair value charge in the period to 30 September 2021 is
GBP973,000.
16. Related party transactions
The following related party transactions took place in FY21 and
FY20:
On 13 February 2020 preference shares of GBP86,401,000 were
issued to funds advised by TA Associates Management LP. The
preference shares including interest amounting to GBP97,085,000
were repaid on 1 March 2021 (accrued interest as at 30 September
2020: GBP6,562,000).
On 13 February 2020 preference shares of GBP26,093,000 were
issued to funds advised by ECI Partners LLP. The preference shares
including interest amounting to GBP29,377,000 were repaid on 1
March 2021 (accrued interest as at 30 September 2020:
GBP1,982,000).
On 13 February 2020 preference shares of GBP4,508,000 were
issued to members of the management team. The preference shares
including interest amounting to GBP5,269,000 were repaid on 1 March
2021 (accrued interest as at 30 September 2020: GBP342,000).
On 13 February 2020 a loan note of GBP385,000 was issued to a
member of the management team. Interest of GBP49,000 (accrued
interest as at 30 September 2020: GBP24,000) was waived on 26
February 2021 and the loan note repaid on 26 February 2021.
On 13 February 2020 a subordinated loan note of US$13,000,000
(equivalent of GBP9,334,000) was issued to funds held by ECI
Partners LLP and TA Associates Management LP. The subordinated loan
note and related accrued interest of US$15,157,000 (equivalent of
GBP10,883,000) (accrued interest as at 30 September 2020:
GBP759,000) were repaid on 1 March 2021.
On 30 September 2020, Tom Hargreaves, a Director of the Company,
received a loan of GBP7,000; the full amount and related interest
were repaid on 26 February 2021.
On 30 December 2020 preference shares of GBP272,000 were issued
to Breon Corcoran, a Non-Executive Director. On 15 January 2021
preference shares were issued to Non-Executive Directors Scott
Forbes and Penny Ladkin-Brand for GBP221,000 each. The proceeds
from the redemption of their preference shares including interest
amounting to GBP724,000 were used to apply for the subscription of
ordinary shares on IPO.
17. Events after the balance sheet date
On 17 June 2021, the Group announced the proposed purchase of
LiveAuctioneers by means of an acquisition of the entire issued and
to be issued share capital of Platinum Parent, Inc. The acquisition
was based on an implied enterprise value of US$525.0m.
Due to its size, the acquisition was classed as a Class 1
transaction under the Listing Rules, and therefore required
shareholder approval. The Group's shareholders approved the
acquisition on 20 August 2021. Prior to the acquisition completing,
approval by the relevant antitrust authorities, including approval
in the UK and US, had to be obtained. The acquisition completed
post the year end on 1 October 2021.
The consideration for the acquisition of US$525.0m was settled
with US$500.0m in cash on completion and earn-out consideration of
up to US$25.0m. The consideration was financed through the Group's
new Senior Term Loan and the equity raise.
Given the acquisition had not yet completed at 30 September 2021
no accounting for the acquisition in accordance with IFRS 3
"Business Combinations" has been included in the FY21 financial
statements.
There were no other events after the balance sheet date.
Glossary
A&A Art & Antiques
Aggregate basis certain measures have been used as the acquisitions of Turner
Topco Limited and Proxibid Inc. on 13 February 2020 have
affected the comparability of the Group's results of operations
for 2021. The measures are presented for the Group to provide
comparisons of the Group's results between 2020 and 2021
as if the acquisitions had occurred on 1 October 2019
-------------------------------------------------------------------
Auction Mobility Auction Mobility LLC
-------------------------------------------------------------------
Bidder sessions web sessions on the Group's marketplaces online within a
given time frame
-------------------------------------------------------------------
BidSpotter the Group's marketplace operated via the www.BidSpotter.co.uk
and www.BidSpotter.com domain
-------------------------------------------------------------------
Big 4 Christie's, Sotheby's, Phillips and Bonhams A&A auction
houses
-------------------------------------------------------------------
EBITDA earnings before interest, taxes, depreciation and amortisation
-------------------------------------------------------------------
Enlarged Group the existing Group including the proposed acquisition of
LiveAuctioneers Group
-------------------------------------------------------------------
GMV gross merchandise value, representing the total final sale
value of all lots sold via winning bids placed on the marketplaces
or the platform, excluding additional fees (such as online
fee and auctioneers' commissions) and sales of retail jewellery
(being new, or nearly new, jewellery)
-------------------------------------------------------------------
i-bidder the Group's marketplace operated by the www.i-bidder.com
domain
-------------------------------------------------------------------
I&C Industrial & Commercial
-------------------------------------------------------------------
KPIs key performance indicators
-------------------------------------------------------------------
LiveAuctioneers Platinum Parent, Inc. and its subsidiaries
Group
-------------------------------------------------------------------
Live auctions Live auctions typically feature a physical auction room
(with bidders participating in the room and by phone) supplemented
by bids made online. Lots are run consecutively and so apart
from the first lot there is no fixed time for specific lots
to be called
-------------------------------------------------------------------
Lot-tissimo the Group's marketplace operated via the www.lot-tissimo.com
domain
-------------------------------------------------------------------
LTIP Awards the Company's Long Term Incentive Plan
-------------------------------------------------------------------
Marketplaces the online auction marketplaces operated by the Group
-------------------------------------------------------------------
Online share represents GMV as a percentage of THV.
-------------------------------------------------------------------
Proxibid the Group's marketplace operated via the www.proxibid.com
domain
-------------------------------------------------------------------
Proxibid Group the operations of Proxibid Inc. and its subsidiaries prior
to acquisition by Auction Topco Limited
-------------------------------------------------------------------
The Saleroom the Group's marketplace operated via the www.the-saleroom.com
domain
-------------------------------------------------------------------
Standalone ATG the operations of Turner Topco Limited and its subsidiaries
prior to acquisition by Auction Topco Limited
-------------------------------------------------------------------
Take rate represents the Group's marketplace revenue as a percentage
of GMV. Marketplace revenue is the Group's reported revenue
excluding Content revenue
-------------------------------------------------------------------
THV total hammer value, representing the total final sale value
of all lots listed on the marketplaces or the platform excluding
additional fees (such as online fee and auctioneers' commissions)
and sales of retail jewellery (being new, or nearly new,
jewellery)
-------------------------------------------------------------------
Timed auctions auctions which are held entirely online (with no in-room
or telephone bidders) and where lots are only made available
to online bidders for a specific, pre-determined timeframe
-------------------------------------------------------------------
Verticals like-for-like industry or inventory, for example, art and
antiques, industrial and construction, consumer surplus
and returns and sub-verticals such as equine, real estate
and classic cars.
-------------------------------------------------------------------
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END
FR QLLBBFLLZFBF
(END) Dow Jones Newswires
December 02, 2021 02:00 ET (07:00 GMT)
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