ii WYG plc Annual Report & Accounts 2018 · Corporate Governance Corporate responsibility 56 Community Engagement 56 Responsible trading and CO 2 ... separately disclosed items were

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ii WYG plc Annual Report & Accounts 2018

1WYG plc Annual Report & Accounts 2018

contentsOverview

Highlights 2

Financial overview 2

Operational overview 2

Current trading and outlook 3

Chairman’s statement 4

WYG at a glance 10

Strategic Report

Strategic management 18

Strategy and objectives 19

The business model 20

Business environment 22

Main trends and factors 22

Consultancy Services 22

International Development 23

Principal risks and uncertainties 28

Corporate responsibility 34

Employee diversity 35

Business performance 36

Introduction 36

Operational review 37

Consultancy Services 38

International Development 42

People 47

Awards 51

Financial review 52

Key performance indicators 53

Going concern basis 55

Corporate Governance

Corporate responsibility 56

Community Engagement 56

Responsible trading and CO2 emissions 64

Directors 66

Directors’ report 68

Corporate governance 71

Directors’ remuneration report 75

Statement of directors’ responsibilities 79

Independent Auditor’s report to the

members of WYG plc 81

Financial Statements

Consolidated income statement 90

Consolidated statement of comprehensive

income 90

Balance sheets 91

Consolidated statement of changes in

shareholders’ equity 92

Company statement of changes in


Cash flow statements 94

Notes to the accounts 95

Shareholder Information

Information for shareholders 126

Financial Summary 130

Advisers 131

2 WYG plc Annual Report & Accounts 2018

Overview

FINANCIAL OVERVIEW• Revenue* up 1.7% at £154.4m (2017: £151.8m); H2 revenue of

£78.2m (H1: £76.2m)

• Statutory operating loss of £4.8m (2017 profit of £2.2m); loss before tax £5.3m (2017: profit of £1.6m) after previously announced £2.5m increase in legacy claim provisions and a £3.2m charge relating to the closure of the North Associates business

• Adjusted operating profit** £3.5m (2017: £8.8m); H2 operating profit of £2.5m (H1: £1.0m)

• Adjusted profit before tax** £2.9m (2017: £8.2m); H2 adjusted PBT of £2.2m (H1: £0.7m)

• Adjusted diluted earnings per share** 4.4p (2017: 11.9p)

• Loss per share 6.9p (2017: earnings of 3.3p)

• Proposed final dividend maintained at 1.2p (2017: 1.2p), giving a total dividend for the year of 1.8p (2017: 1.8p)

• Operating cash conversion*** of 190% (2017: 92%)

• Net debt as at 31 March 2018 £6.3m (30 September 2017: £10.1m, 31 March 2017: £2.5m)

• Order book up 14.7% to £166.4m as at 31 March 2018 (31 March 2017: £145.0m):

- Consultancy Services order book up 6.9% to £96.1m (2017: £89.8m) reflecting continuing growth in our infrastructure and planning markets

- International order book up 27.5% at £70.3m (2017: £55.2m) following project wins in the year

* Including revenue from Joint Ventures

** Adjusted operating profit is statutory operating profit after adding back separately

disclosed items

*** Underlying operating cash conversion is defined as adjusted operating cash flow

divided by adjusted operating profit

OPERATIONAL OVERVIEW• Consultancy Services revenue up 3.0% at £119.3m (2017:

£115.8m), reflecting improving performance across most areas, despite project delays in H1

• International Development revenues reduced to £35.1m (2017: £36.1m) as H2 was impacted by delays in funding for Turkish projects caused by the transition between the first and second phases of the IPA funding programmes

• Established a new international holding company in the Netherlands to underpin ability to bid, win and deliver EU work

• Agreed and extended £35m bank facility with HSBC to 2022

• Actions being taken to improve profitability and efficiency across the business include:

- Closed loss-making North Associates business

- Closing non-core Romanian and Bulgarian businesses – trading licences retained

- Steps taken to simplify and flatten the management structure

- Efficiency review underway, for implementation progressively in FY 2018/19 and beyond

- Targeted investment in IT, including digitalisation, business infrastructure, London presence and capabilities to support efficient future growth

• Board changes:

- Douglas McCormick appointed as Chief Executive Officer in June 2017

- Jeremy Beeton succeeded Mike McTighe as Chairman with effect from September 2017

- Marcia Marini appointed as a non-executive Director with effect from January 2018

- David Jeffcoat to retire at the AGM following 9 years’ service

Stable revenue; improved H2 and strengthening orderbook


Douglas McCormick

Chief Executive Officer of WYG plc

“These results reflect an improved second half despite the continued delays experienced by our Turkish business. Having posted a disappointing set of results at the half year, the team has taken action to start to offset the issues we highlighted in August and November 2017, and there have since been several positive developments ensuring that we met the market’s revised expectations of our profit and cash performance.

“We have made good progress implementing our strategy; extended our bank facility with HSBC; and completed a significant step to stabilise WYG’s position in light of the potential impact of Brexit.

“Many of the major projects in both of our principal business streams that were delayed in 2017 are now being delivered and our strong order book underpins a significant proportion of FY19’s projected earnings. We have a clear strategy in place, a reshaped leadership team and a strong wider group with deep expertise in our chosen markets. There is plenty of opportunity to build on this robust platform and I believe we are taking the right steps to return to growth in profitability.”

CURRENT TRADING & OUTLOOK• Consultancy Services business delivering

improved results

• International Development opportunities continue despite delays in Turkey

• Strengthening order book provides a sound basis for current year expectations and medium-term confidence

• Underlying business robust, expecting to return to an improved profitability trajectory in the medium term


Chairman’s statement

INTRODUCTIONHaving announced a disappointing set of results at the half

year, the Group delivered an improved second half, despite

the project delays experienced by our Turkish business,

delivering revenues of £154.4m, operating profit before

separately disclosed items of £3.5m, and net debt of £6.3m

for the year ended 31 March 2018.

Overall, we have seen increased activity in almost all areas

of our Consultancy Services business, albeit at lower levels

and margins than anticipated at the beginning of the year.

Our International Development business showed good

growth in all areas except Turkey which has been affected

by the transition between the first and second phases of the

IPA funding programmes.

We have improved the shape of the Group, simplifying

the management and Board structure and are underway

with a review to identify cost initiatives which, alongside

investment in the Group, will improve the Group’s efficiency

in the near term and better support sustainable growth in

the medium term.

Our response to the challenges we reported in the first

half will improve our resilience as a business capable of

generating quality revenues from front-end, value-adding

consultancy services and international development

programme implementation, monitoring and evaluation. We

now have committed funding, strong operational leadership

and good visibility of a healthy pipeline of opportunities with

international financial institutions and government agencies

with which we have good relationships.

We now anticipate that the improvement which started

in the second half of the year will continue into the new

financial year and, as we deliver on our commercial

strategy and make selected investments in the business to

support future growth, we remain confident that WYG is a

fundamentally sound business with a strong platform from

which to grow over the medium term.

COMMERCIAL STRATEGYOur strategy is to grow over time by developing and serving

markets for our consultancy and international development

expertise through an appropriate blend of organic

investment and selective acquisitions, whilst recognising

the risks and opportunities presented by a dynamic global

market and political environment.

We will achieve this by harnessing specialist skills from

across the business to address the challenges of climate

adaptation, energy planning, defence, major infrastructure

development, water management, mass migration and the

growing UK housing requirement, whilst changing the way

that we do business to become more efficient at responding

to our clients’ needs by:

Developing a simpler, more robust platform

During the last year we have brought together those parts

of our business, both in the UK and internationally, which

operate in related technical services fields under the

Consultancy Services business stream. Our International

Development business stream now focuses on projects

where we work in collaboration with governments and

international finance institutions to promote socio-economic

stability and trade development, unlocking the potential for

sustainable development among local communities.

We have closed our loss-making North Associates business

and today confirmed the closure of our Romanian and

Bulgarian businesses where we could not see sufficient

potential returns.

In addition we have taken steps to simplify, flatten and

strengthen the management structure and Board, with

all of the businesses now reporting directly to CEO

Douglas McCormick, and made a number of high calibre

appointments across the Group whilst not replacing certain

senior management and Board roles.


Driving efficiencies

Operationally, we continue to drive efficiencies in our office

portfolio, from which we derive other benefits, for example

in reduced IT costs and better collaboration to make the

most of technology to improve the quality of our delivery.

We are currently undertaking a wider efficiency review to

identify key cost-reduction initiatives to be progressively

implemented in the current financial year and beyond.

We have also recently initiated a programme to achieve a

greater standardisation of business processes throughout

the Group to deliver gains from improving systems,

embracing new technologies and investing in training. We

will be seeking to deliver measurable improvements in the

coming year.

Return to sustainable growth in the medium term

We will continue to make targeted investments in

technology, including in digitalisation of the way we work,

in Group infrastructure, in our London presence and in the

capabilities that will enable us to deliver sustainable growth

in the medium term.

We are also looking at opportunities to deploy our existing

range of specialist skills into new markets, for instance

where we can use strong sector credentials in one

geography to develop new business in another.

Once we have an enhanced and more efficient platform in

place, we will also consider selective acquisitions that will

extend our capabilities, geographical reach or access to

certain clients or funding streams.

We believe this three phased strategy will provide us with

a strong platform from which to deliver our ambition of

continuing as a trusted adviser to clients and providing

them with a broad set of expert consultancy services which

help them create value, manage risk and make critical

investment decisions.

RESULTSRevenue (including our share of Joint Venture revenues)

for the full year was up 1.7% to £154.4m (2017: £151.8m).

Revenue in the second half was up 2.5% to £78.2m (H1 2018:

£76.2m). The 9.5% increase in Consultancy Services revenue

in the second half was offset by the significant reduction in

revenue from our Turkish business.

On a statutory basis, the Group made a loss before tax of

£5.3m (2017: £1.6m) on pre-joint-venture revenues of £152.9m

(2017: £150.5m). The statutory loss reflects an increase of

£2.5m in our provision for contract claims and costs of £3.2m

relating to the closure of the North Associates business

acquired in October 2015. Earnings per share adjusted to

exclude separately disclosed items were 4.4p (2017: 11.9p).

On a statutory basis, the loss per share was 6.9p (2017:

earnings of 3.3p).

Adjusted operating profit was £3.5m (2017: £8.8m)

representing a marked reduction in adjusted operating

margin to 2.3% (2017: 5.8%). This was caused by losses in

our real estate business, high rates of staff turnover in two

key businesses areas, delays in major projects, and revised

expectations of a small number of engineering projects.

Adjusted operating profit improved in the second half to

£2.5m (H1 2018: £1.0m). Adjusted profit before tax was £2.9m

(2017: £8.2m).

The Group closed the year with net debt at 31 March

2018 of £6.3m (31 March 2017: £2.5m). This is the result

of increased investment in the business both in terms

of capital expenditure on two new offices (London and

Ankara), and expenditure on other legacy and restructuring

items. Cashflow before legacy costs (in relation to PII claims,

vacant premises and pensions) and investments was £3.0m

(2017: 5.4m).

As at 31 March 2018, the Group’s order book was up 14.7%

to £166.4m (31 March 2017: £145.0m), with the committed

pipeline of work to be undertaken in the current year giving

a sound basis for the delivery of the Board’s current year

expectations.

6

Surveying & Asset Management

One of this year’s winning images in our internal Photography Competition, this shot of Norwich Crown Point Depot was taken by Alan Taylor whilst undertaking surveys for the Asset Management team.

6


BANK FACILITYIn September 2017, we increased our committed multi-

currency revolving credit facility with HSBC from £25m to

£35m. The facility offers the Group broad flexibility between

debt and bonding requirements and now runs until

September 2022.

DIVIDENDIn April 2018, we paid an interim dividend of 0.6p. The Board

remains confident in the Group’s medium term prospects,

therefore, subject to the approval of shareholders at the

AGM, a final dividend of 1.2p will be paid on 3 October 2018

to ordinary shareholders on the register on 7 September

2018, maintaining the overall dividend for the year at 1.8p

per ordinary share (2017: 1.8p).

The Financial Results are discussed in more detail

in the Strategic Report and set out in full in the

Financial Statements.

BOARD CHANGESAs previously announced, on 12 June 2017 Douglas

McCormick took up the appointment of Chief Executive

Officer and, on 21 September 2017, I succeeded Mike

McTighe as Chairman of the Board. Neil Masom agreed to

become the Senior Independent Non-Executive Director.

Marcia Marini was appointed as a Non-Executive Director

with effect from 1 January 2018. Marcia has 25 years’

experience in a wide range of businesses and sectors,

including with UK Government agencies operating in the

international development arena. Between 2003 and 2008,

she was Managing Director of Mott Macdonald’s Health

Unit, an Executive Director of their Education Unit and, for a

time, a member of their Risk Management Committee.

Having completed nine years’ service as an independent

non-executive Director, during which time he chaired the

Audit & Risk Committee, David Jeffcoat will retire from the

Board at the conclusion of this year’s AGM. On behalf of the

Board I would like to thank David for the contribution he

has made over the past nine years. We have decided not

to replace David’s role on the Board and to operate from

September as a smaller team.

With effect from the AGM, Neil Masom will chair the

Audit & Risk Committee and Marcia Marini will chair the

Remuneration Committee.

RISKS AND UNCERTAINTIESAs an organisation that contracts directly with the EU,

we remain mindful of the challenges presented by Brexit

and the ongoing uncertainty surrounding its eventual

implementation. To date we have seen no material

impact on financial performance from the decision. Our

international business model is robust and agile and our UK

and international subsidiaries have continued to win work

with major international finance institutions and our other

clients at levels consistent with historic bid-win rates.

As announced in December 2017, we have taken steps to

mitigate the risk of Brexit by creating a new intermediate

holding and management company in the Netherlands to

ensure we remain eligible under the relevant EU regulations

to bid for, secure and deliver work funded from the EU

Budget or EU Development Funds. We achieved this by

undertaking a merger of WYG International Limited with a

newly created company registered in the Netherlands,

in accordance with the UK Companies (Cross-Border

Mergers) Regulations 2007 and the relevant provisions

of the Dutch Civil Code. The merger became effective

on 1 December 2017. The new company has inherited

the staff and the financial and project track record of its

predecessor company.

In addition, there are other geo-political uncertainties that

could affect WYG’s performance and, as we saw in both the

last two years, programme deferrals on existing contracts

and delays in the confirmation of new contracts present an

ongoing risk to WYG’s expectations of its performance.

A fuller assessment of the risks and uncertainties that could

impact the business is set out in the Strategic Report.


THE ANNUAL REPORTIn the Strategic Report we provide a description of the

business, the environment in which we work, our strategy

and business model for creating value for shareholders,

as well as a more detailed review of our performance,

analysis of our results and a description of the risks to

the business and the KPIs against which we benchmark

our performance.

In the Corporate Governance section we provide further

detail on our corporate responsibility activities, the statutory

Directors’ Report and Directors’ Remuneration Report

together with information on the key Board committees.

The Financial Statements and Shareholder Information

section (including the Notice of Annual General Meeting)

follow a similar format to previous years.

PEOPLEAs a Board, we recognise that it is the enthusiasm, quality

and dedication of our employees that underpin our success

and, during the year, we have witnessed many of the great

qualities people bring to WYG. These will be essential as

we move the business forward and it is very pleasing to see

that this has been recognised in a number of awards and

commendations during the period.

We are pleased to have made several new and high calibre

senior appointments who we expect to make significant

contributions to winning and delivering new business in the

coming years. Since the year end, we are also pleased to

have seen a stabilisation in staff turnover rates, which had

been high in two key businesses areas during the year.

CURRENT TRADING AND OUTLOOKAgainst a backdrop of relative economic stability in the

UK, continuing government expenditure on selected

infrastructure and other long-term programmes creating

a reasonably positive environment for our main public and

private sector clients, we expect opportunities for our front-

end planning and consultancy business to continue to grow.

Although we continue to experience some delays in Turkey

caused by the transition between the first and second

phases of the IPA funding programmes, IPA II projects are

now being let and there is a healthy pipeline of opportunity

in all our other international development target markets.

We are also looking at opportunities to deploy our existing

range of specialist skills into new markets and, during the

next 12 to 18 months, we expect to deliver improvements

in efficiency driven primarily by further rationalisation of

the property portfolio and greater use of technology

and innovation.

As a Board, we remain confident that the underlying

business is robust and that, supported by a strengthening

order book and the careful selection of investments in the

business to support future growth, we are taking the correct

steps to return to growth in profitability. We therefore expect

a performance in the current financial year ending in March

2019 which is in line with market expectations.

Jeremy Beeton CB

Non Executive Chairman

5 June 2018


Overseas PSP

“Proud of our #ProjectManagement and #structural #engineering team for supporting the @RoyalNavy’s UK Naval Support Facility in #Bahrain these last two years. It was a privilege for us to attend the grand opening in Mina Salman at the beginning of April 2018.”

9


WYG at a glance

WYG is an award-winning professional services firm employing around 1,600 people and operating from more than 30 locations across the UK, Europe, Africa, Asia and the Middle East.

We are driven by client service and underpinned by technical excellence. We help create value, protect value, and manage risk. We are a partner of choice for organisations operating in complex or challenging environments.

We serve our clients through two business streams:

• Consultancy Services provides bespoke specialist teams to offer high value technical services to the domestic markets in which we operate.

• International Development builds on our existing strengths to optimise the value of projects in collaboration with government and donor agencies, promoting socio-economic stability, trade development and unlocking the potential for sustainable development in local communities.

Our aim is that through proactive management consultancy we can identify opportunities for our clients, and aid their decision-making process to manage risks, inform investments, create value, and develop assets.

ACROSS THE GLOBEWe follow our clients wherever their ambition takes

them, often operating in volatile territories and uncertain

circumstances. Working on some of the most sophisticated

projects across the globe, WYG finds the very best

local partners to work with on projects to ensure that it

understands and has the ability to influence positively the

local communities it works with.

We are committed to selecting the best equipped people

for each assignment. We do our utmost to fulfil our duty

of care to keep them safe, secure and healthy no matter

where the work takes them.

Working with government and donor clients to create

stability and support restructuring following change or post-

conflict continues to be a strong focus for the Company.

We engage in long-term programmes to help our clients

ensure that the world’s growing population is served with

the necessary energy and water infrastructure whilst

minimising carbon impact and climate change. This

challenge is faced by developed, emerging and less

developed economies alike.

The business is an expert in developing infrastructure

related to population expansion, urbanisation and

transportation as the world seeks to become

super-connected.

We ensure we deliver the very best value for our clients

by providing excellent service, not just excellent services.

We’re committed to delivering the same client experience

no matter what the type of project by ensuring our

individual business units work together at a strategic level.

WYG takes this commitment to clients very seriously. It is a

people business, and by investing in training and resource

for our people, and combining that with a respect for and

ability to work as partners with our clients, we are able to

make a difference on our projects. You can find testimonies

to this in our case studies throughout this publication and

on our website at www.wyg.com.


1,600Employees

35Offices located in the UK, Turkey, South Africa, Kenya, Croatia, Poland, The Netherlands, Serbia, Russia, Uganda and Nigeria



Project Spotlight – Consultancy

The Jennings Building Restoration

Our planning experts coordinated planning delivery

and listed building consent for the restoration of an

abandoned, Grade II listed building on Porthcawl’s

seafront, Wales. The aspiration for the Jennings

Building was to bring it back into public use, providing

exciting new premises for local businesses and

inspiring further regeneration initiatives.

Sustainable Best Practice

Opened in September 2017, the Jennings Building

exemplifies best practice in planning for heritage and

culture, setting a benchmark for listed buildings in

functional harbour-side settings. In just two years, the

scheme progressed from initial design to planning,

approval, and delivery of new uses and is already

acting as a catalyst for regeneration of the wider

Porthcawl seafront and marina areas.

The re-use of an important historical building on a

brownfield site is inherently sustainable. In addition

to bringing the site back into active use, the scheme

aimed to secure a positive future for the building

with new roof insulation and high-specification

double glazing to mitigate against energy loss in this

exposed harbourside location.

Achieving the Vision

To achieve tangible local benefits, the developer,

design team and local authority worked cooperatively

throughout the land transaction and statutory

planning processes. This encouraged innovative

approaches to achieving a high-quality conversion

fulfilling the authority’s vision for the building to

become a vibrant contributor to the Porthcawl

economy while respecting the rich history of the

building itself. The project has been shortlisted for

RTPI and RICS awards.



Project Spotlight – Consultancy

Strule

We have been working on a flagship project in

Northern Ireland, which will see the relocation of

five post-primary schools and one special school

onto one brownfield site - the Strule Shared

Education Campus.

The site, which was a former army barracks site in

the town centre, is being redeveloped to provide

shared educational and sporting facilities (including

16 natural turf and 4G football sports pitches) for

up to 4,000 students.

Our appointment came in late 2015 to lead the

Integrated Consultancy Team, with Kennedy

Fitzgerald Architects (KFA) appointed as sub-

consultant and Lead Architects.

The project brings together our in-house consultancy

expertise from multiple disciplines to deliver an

integrated service to the client from project and

cost management to planning, environmental and

engineering consultancy.

Collaborative working

To align resources on this major project the full

design delivery team, including KFA and the

employer’s technical advisory team, are working

together under one roof. Working in partnership

from the design hub in our Belfast office helps a

collaborative ethos, promotes wider design team

collaboration and ensures the project is delivered

to programme.



Project Spotlight – International Development

Helping Montenegro integrate its disadvantaged groups

Working with the Employment Agency of

Montenegro (EAM) and Social Work Centres (SWC),

we have played an instrumental role in helping

to determine services and solutions to combat

hardships affecting disadvantaged groups in

Montenegro.

Strengthening Capacities

As 2017 came to a close, we completed a 21-month

project seeking to strengthen the EAM and SWC’s

capacities to integrate disadvantaged groups into

Montenegro’s labour market. The project was part

of a wider effort by the Ministry of Labour and Social

Welfare of Montenegro to modernise their service.

Prior to project implementation, we released a report

analysing the social inclusion sector and business

solutions for social activation, providing our client and

other agencies direction for further action.

Enabling Capacity-building

To share our experience with stakeholders at central

and local levels, we created capacity-building and

training activities for EAM local branch offices, SWC,

and non-governmental organisations. These sessions

focused on topics such as the role of EU policy and

European financial resources in promoting integration

for disadvantaged groups. At the same time, they

fostered the practical, personal, and communication

skills needed to reach out to those groups and make

a difference.

To further facilitate the sharing of knowledge and

experience, our team held a study visit in Croatia and

Slovenia at the end of May 2017 and also organised

regional training events to support potential grant

applicants and grant beneficiaries who work with

disadvantaged groups through the Instrument for

Pre-Accession funding programme in Montenegro.


1 Cautionary statement

This Strategic Report has been prepared solely to provide information to shareholders to assess how the directors have

performed their duty to promote the success of the Company.

The Strategic Report contains certain forward-looking statements. These statements are made by the Directors in good faith

based on the information available to them up to the time of their approval of this report and such statements should be treated

with caution due to the inherent uncertainties, including both economic and business risk factors, underlying any such forward-

looking information.

To the members of WYG plc

This Strategic Report has been prepared for the WYG group as a whole and therefore gives greater emphasis to those matters which are significant to WYG plc and its subsidiary undertakings when viewed as a whole 1.

STRATEGIC MANAGEMENT

WYG is an international project management and technical

consultancy with an in-house team of c.1,600 specialists.

WYG is also able to draw on a network of over 20,000

partners, associates and contacts from around the world to

form the teams its clients need to make their asset creation

and international development project ambitions come to

life. We help to create value, protect value and manage

risk. We are a partner of choice for organisations working

in complex or challenging environments. In the year to 31

March 2018, WYG generated revenues of £154.4m on which

it made an operating profit before separately disclosed

items of £3.5m and a statutory operating loss of £4.8m. As

at 1 June 2018, WYG had a market capitalisation of £32.0m.

WYG’s ordinary shares are traded on AIM.

Strategic Report


STRATEGY AND OBJECTIVES Our aim is to deliver shareholder value and drive

growth across the business by implementing our

strategy of developing and serving the markets for our

consultancy and international development expertise

through an appropriate blend of organic investment

and selective acquisition, whilst recognising the risks

and opportunities presented by a dynamic global

market and political environment.

In March 2017, the Board finalised a new long-term

growth strategy which aims over its five year cycle to

develop WYG’s strong reputation for being a professional

services firm underpinned by technical excellence. At the

heart of this strategy is a focus on combining the strengths

of our consultancy services and international development

businesses to generate optimum value for our clients,

delivering sustainable growth and improving margins.

Our strategy is built around interdependent key themes

which include making our presence, growth and profile in

London a priority. The other themes are: generating a new

higher value service mix, promoting ever greater integration

of the business and continuing to reduce the amount of

high risk, low value work in our portfolio. Finally, given that

we are people-focused business, we aim to the destination

of choice for talent across the industry.

During the reporting period we have:

• improved the Group’s agility by putting in a new structure that positions WYG to generate and rapidly respond to the most attractive opportunities presented by our clients’ needs as they navigate the current uncertain and dynamic global market and political environment.

Our focus over the coming 12 months will be to:

• drive further efficiencies by rationalising our office portfolio, harnessing technology to improve the quality of delivery, and reduce costs and headcount in certain areas, whilst retaining capacity to fulfil our commitments

• enhance the resilience of our business by deepening and diversifying client relationships, being focused and selective in our investments and prudently exiting from lower return activities.

This plan harnesses the specialist skills from across our

business bringing the improved focus required to address

the major challenges of climate adaptation, energy

planning, major infrastructure projects, defence, water

management, mass migration and the UK housing shortfall.

We keep our strategy under review to ensure that it remains

appropriate and focused.


WYG is a multidisciplinary provider of front-end

(programme, project management and technical)

consultancy services with an international presence.

Client profiles, workflow and service delivery models

differ between our Consultancy Services and International

Development businesses but both reporting segments

are positioned to align as closely as possible with their

respective markets.

Development of the natural, social and built environment

is the common thread running through the range of

consulting services that we offer. Consultancy Services,

especially in more mature regions such as the UK, focuses

on asset creation and enhancement through our traditional

planning and development disciplines - especially for

infrastructure, urban and environmental projects.

We commit our resources to winning places on key

framework agreements and then maximising the

opportunities arising from them. We look to increase value

for our clients by uniting our own technical and economic

expertise with that of chosen partners and then integrating

complex supply chains of small and medium-sized

enterprises to ensure we offer a comprehensive solution to

clients’ problems.

Our International Development business focuses more

on policy and institutional advice and planning for the

implementation of international development funded

programmes, usually for external agencies. We seek

to grow revenue and profitability by positioning the

International Development business in markets where

governments and international finance institutions have

made strategic, budgeted commitments, such as countries

in Africa. We continue to enjoy a leading position in a

number of EU funded programmes and our well-developed

presence in Poland, Croatia and Turkey ensures that we are

able to bid and deliver major projects across the whole pre-

and post EU accession life cycle.

Where we are exposed to particular risks, whether of scale

or due to the geo-political risk environment in which a

project is to be delivered, we adopt project-specific risk

mitigation measures and we take a portfolio approach

to ensure that the underperformance of one project is

mitigated by outperformance on others.

WYG comprises a number of limited companies (or

equivalent) within a structure headed by WYG plc. However,

at the operational level, the Group is now structured around

two principal business streams: Consultancy Services and

International Development. Each business stream has its

own support services and can draw on the expertise of a

central bidding team to enhance the prospects of winning

selected opportunities.

WYG at everystage of the

financing cycle

STRATEGY FOR GROWTH

PROJECTSTO MEETOBJECTIVES

ACCESS TORESOURCES

EVIDENCEFOR POLICY

DELIVERY

EVALUATION

The Business Model


Direction is provided by WYG plc’s Board of Directors, who

set the Group Strategy and through:

• the Senior Leadership Team (SLT) which comprises the CEO, CFO, CIO, Executive Director - Strategy and Corporate Development, HR Director, Commercial Director, MarComms Director, Executive Director, Business Development Director, General Counsel and the Managing Directors of each of our businesses

• Leadership Teams comprising the head of the relevant business, its Finance Director and others by invitation. These teams meet monthly or more often as required and report to the executive Directors at monthly Accountability Reviews and, in more depth, at Quarterly Performance Reviews.

The seven core market sectors we serve, which are

defined by reference to our clients, are: Defence & Justice,

Energy & Waste, Environment (including water and waste

water), Transport, Mining & Minerals, Urban & Commercial

Development, and Social Development & Infrastructure.

The Consultancy Services business is now organised

into five businesses and a business support group. Each

business has an MD who sits on the SLT.

The five businesses are:

• Infrastructure & Built Environment

• Programme & Project Management (P3M)

• Surveying & Asset Management

• Environmental

• Planning & Transport

We use a variety of approaches to charge for services

including: hourly rates, cost plus, and lump sum or fixed

price contracts, or a mixture of these. Fees may be billed on

completion of the project (usually the smaller ones), at fixed

intervals or upon the achievement of certain milestones.

For larger projects (where significant mobilisation costs may

be incurred) we may seek an advance payment which may

or may not be secured by a bond. Throughout the Group

we emphasise the importance of cash generation and the

effective management of working capital. In particular, we

place a heavy emphasis on seeking to reduce our working

capital days, one of our primary financial KPIs. Our other

financial and non-financial KPIs are described in more

detail below.

In delivering services to our clients we commit to working

hard to get to know our clients and what drives them so

that we can go beyond basic levels of service and deliver

something that is truly valuable. We strive to be creative and

to build long-term client partnerships. We seek always to

operate in accordance with our business principles as well

as the detailed policies and procedures of the Group.

We have a clearly articulated Commercial Development

and Operating Process (CDOP) which is a framework for

decision making and project management. A robust CDOP

is essential for a professional services firm with multiple

professional disciplines such as ours, because it helps us to

mitigate risk thereby creating sustainable profits and cash

to reinvest in the business, to re-invest in our people and to

create value for our shareholders.

The executive Directors, together with the Group

Commercial Director, Group Financial Controller and

General Counsel, also comprise the Investment Committee.

The purpose of the Investment Committee is to:

• ensure a strategic view is maintained of any consents requested from WYG’s main Board

• review and challenge any matters reserved for the approval of the main Board or the Investment Committee itself including:

- major bids

- where WYG main Board approval is required, make recommendations to the Board

- other out of budget investment proposals

• ensure that effective governance arrangements are in place throughout the Group.


Business Environment

MAIN TRENDS AND FACTORS The demand for consultancy services both in the UK

and overseas continues to be strong and we expect

our business to grow as a result. Despite some macro-

economic factors including Brexit, political divisions

within the Eurozone, some geopolitical instability (leading,

for example, to new trade sanctions), accelerating climate

change, cyber insecurity and terrorism, the outlook for

the international Support Services sector continues to

be positive.

CONSULTANCY SERVICESShort term economic indicators in the UK continue to be

mixed, with headlines indicating slower growth, increased

inflation and weakening business confidence, chiefly

as a result of the Brexit negotiations. However, partly in

response to these concerns, the UK Government has

been focusing on the opportunities it expects to arise from

Brexit such as reduced regulatory burdens, greater trade

freedom, an increasing focus on education and skills, and,

essential to its vision of improving living standards, driving

economic growth and boosting productivity, investment

in infrastructure. Consequently, the main drivers of WYG’s

business: which include investment in infrastructure,

housing, defence and overseas development, show no sign

of slowing down.

Published in December 2017, the National Infrastructure

and Construction Pipeline sets out details of over £460bn

of planned infrastructure investment across the public

and private sectors of which over £240bn will occur in the

next four years. The majority of this investment will be in

transport, energy and housing, sectors closely aligned

with the core services delivered through WYG’s Planning

& Transport and Infrastructure & Built Environment

businesses.

With more than 160,000 new build house starts in England

in 2017, up 5% on 2016, most regions showing growth

and the long-term trend showing a steady year-on-year

increase, WYG’s national planning team, the third largest

in the UK, is well placed to benefit. As articulated in its

housing white paper, “Fixing our Broken Housing Market”

(announced in February 2017) the UK Government remains

committed to increasing the number, rate of building and

construction quality of new homes. WYG’s planning teams

are currently working on c.170 major housing schemes

across the UK. These have the potential to deliver more

than 150,000 new homes within the next five years.

The UK Government’s land release strategy connects our

residential and project management expertise with most

major UK Government departments including the NHS,


Ministry of Justice and public sector bodies such as the

Homes England and Network Rail. Foremost among these

is the Defence Infrastructure Organisation which has plans

to release sufficient land to build 55,000 new homes. The

c.£2bn the DIO expects to raise from sales will be reinvested

in the remaining estate. The DIO is committed to investing

around £4bn over 10 years (from 2016) in its ageing estate

which also generates significant opportunities for our

Programme and Project Management business. This is

on top of the £1.8bn allocated to Army Basing on which we

also work.

In the Nuclear Sector, the UK has more than £250 billion

of decommissioning to undertake and the Nuclear

Decommissioning Authority recognises that collaboration

across the industry and government is essential to get

costs down and maximise economic recovery. The

decommissioning of the UK’s current and future nuclear

liabilities represents a significant spend over a lengthy

timeframe and over the long term, offers opportunities for

suitably qualified and experienced practitioners such as

WYG to expand into the international decommissioning

market. To secure the low carbon power generating

capacity the UK needs, the Government is supporting

public and private investment in the nuclear new build

programme with projects such as Hinckley Point C power

station and Moorside. Both in the decommissioning and

new nuclear programmes, WYG’s Surveying & Asset

Management business has core skills and a depth of

experience developed mainly at Sellafield to offer.

We believe there are also opportunities to benefit from

the thriving UK rail infrastructure market combining the

expertise we have developed in Central & Eastern Europe

with our existing multidisciplinary skill set in the UK. With

15,000 live projects, Network Rail accounts for around

22% of all infrastructure spending in the UK. A significant

proportion of this is devoted to planning, permitting,

ground investigation and ecology - all of which are

core strengths of WYG’s Planning & Transport and

Environmental businesses.

INTERNATIONAL DEVELOPMENT WYG’s International Development business works for a

range of private, national and supra-national public sector

clients across its international development markets.

The availability of project and programme funding is the

main business driver for most of our overseas operations

so the seven-year EU budget – the Multi-annual Financial

Framework or MFF 2014-2020, which was approved in

December 2013, is of particular relevance to WYG. This

authorises spending of up to €960bn, with a strong

emphasis on budgetary discipline, boosting growth and

creating jobs. This resonates well with our core areas of

technical expertise in public financial management and

the delivery of economic, social and technical assistance

programmes. It also means that there are increasing

opportunities for our growing Monitoring & Evaluation

team which plays an important role in helping funders

and contracting authorities make good choices, improve

programmes as they are rolled out, ensure that their aims

are achieved, and that they are getting value for money.

EU funds are distributed through:

• the European Social Fund (ESF), which focuses on improving employment opportunities, promoting social inclusion and investing in skills by providing the help people need to fulfil their potential

• the European Regional Development Fund, which supports research and innovation, small to medium-sized enterprises and the creation of a low carbon economy

• the European Development Fund (EDF), which provides aid for development cooperation with African, Caribbean and Pacific countries. The EDF is not funded from the EU budget but from direct contributions from EU Member States, as such, the EDF does not fall under the MFF 2014-2020 medium sized enterprises and the creation of a low carbon economy

• the Instrument for Pre-Accession Assistance (IPA), described in more detail below.

One element of the MFF 2014-2020 is the Instrument for

Pre-Accession Assistance (IPA). IPA I had a total budget of

some €11.5bn; its successor, IPA II, has a budget of €11.7bn


for the period 2014 to 2020. Of this sum, €4.4bn has been

allocated to Turkey. These funds are designed to help

the beneficiaries make political and economic reforms

preparing them for the rights and obligations that come

with EU Membership. They also help the EU achieve its

own objectives regarding a sustainable economic recovery,

energy supply, transport, the environment, climate

change and migration. The other beneficiaries are Albania,

Bosnia and Herzegovina, the former Yugoslav Republic

of Macedonia, Kosovo, Montenegro and Serbia. We have

offices and/ or projects in all of these countries. Despite

the impact on our Turkish business caused by the delay in

transitioning from IPA I to IPA II, projects under IPA II are now

flowing through.

WYG’s International Development business, which

accounted for c.23% of WYG’s revenue in FY 2018,

provided some resilience during the UK downturn.

Conversely, in 2015/6, largely due to the delay in signing

the MFF 2014-2020, and more recently with the hiatus in

Turkey in late 2017/ early 2018 caused by delays in new

programmes being tendered under the next funding cycle,

IPA II, we saw a decline in overseas revenue from EAA and

Turkey whilst the UK provided stability and growth. The

integration of our predominantly UK Consultancy Services

and International Development businesses, under the WYG

umbrella seeks to maximise value for shareholders by

being sufficiently agile to follow the major funding streams

that drive our growth. This approach also gives us good

defensive characteristics.

Despite signs that EU funding is starting to move away

from supporting a heavy infrastructure in well developed

countries and towards the sort of education, employment

and social cohesion sectors supported by the European

Social Fund, there are still significant funds available for

infrastructure and our technical services teams in Poland,

the Western Balkans and Turkey is well positioned to

benefit, particularly through its expertise in transport and

water & waste water.

The UK’s commitment to spend 0.7% of Gross National

income in Overseas Development Assistance is enshrined

in law. As a result, the UK, is expected to remain a global

leader in international development - both financially

and technically. With a buoyant pipeline and spending

exceeding £10bn in 2017, the Department for International

Development (DfID) is under pressure to diversify its

supplier base presenting significant opportunities for WYG’s

International Development business. Although UK aid is

untied i.e. it is open to organisations of all nationalities,

and we expect increased competition from consultants

from countries with shrinking aid budgets, we believe

our position on key frameworks with the UK Foreign &

Commonwealth Office (FCO), World Bank and DfID including

the Conflict Stability and Security Fund (FCO), the Prosperity

Fund (DfID) and the Good Governance Fund for Eastern

Europe (DfID), as well increasing funding for climate change

resilience in developing countries, make us well positioned

to benefit.

A recurring challenge and opportunity for us is to ensure

that we have in place robust and responsive critical support

systems to fulfil our duty of care obligations to employees

and associates. We continue to invest in the expertise and

resources to make this possible. This has enabled us to

deliver projects in the Democratic Republic of the Congo,

Somalia, Nigeria and other countries where the quality of

our duty of care arrangements has been recognised as

excellent by our clients and partners.


OTHER TRENDS AND FACTORSIn the Chairman’s Statement on pages 4 to 8 we explain how

we have taken steps to mitigate the risk of Brexit by creating

a new intermediate holding and management company

in the Netherlands to ensure we remain eligible under the

relevant EU regulations to bid for, secure and deliver work

funded from the EU Budget or EU Development Funds.

There has been further consolidation in the consultancy

services industry driven by factors including low interest

rates, the positive outlook for the sector, growing

margins and the continuing rapid developments in IT

and connectivity. The acquisition by Jacobs of CH2m,

of Waterman by CTI Engineering of Japan, and of ESI

Consulting by Canadian headquartered firm, Stantec,

illustrate that the desire on the part of investors for

increasing yields and a broader spread of risk and

opportunity mean that mergers and acquisition activity

is set to continue. However, we continue to believe that

our best route to optimising value for all stakeholders is

by continuing as an independent group, and we consider

that our portfolio of UK and international work allows us to

make the most of global opportunities while keeping the

associated risks to a reasonable level.

Competition for high quality staff and its effect on wage

inflation presents an ongoing challenge. We have further

strengthened our in-house resourcing team and reviewed

and, where appropriate adjusted, our pay and benefits to

meet this challenge. Similarly, competition for the best

opportunities is intense and we find ourselves coming up

against not only our traditional competitors such as Mott

Macdonald, Aecom, Turner and Townsend but also the

high-end management consultancies such as PwC, KPMG

and McKinsey & Company, Inc.. Despite this, we still find

that on many of our international development projects our

competitors are often keen to partner with us to access our

references, expertise and local presence. When we are not

in partnership we seek to make the most of the advantages

of operating from a lower cost base and with a better

developed local presence in our key markets.

26

London Office client event

November 2017.

26

27

“The move to our new London office Angel Court will

further accelerate both the development of our profile as a professional services

organisation and make WYG an even better place to work.

Over recent years our London office space has not adequately

reflected the excellent work we deliver for clients and the

move is a catalyst to deliver higher value integrated project

solutions for existing and new clients.”

Nathan Holloway

Divisional Director, Due Diligence, London


Principal Risks & UncertaintiesThe Board is responsible for determining the Group’s risk

appetite and tolerance levels to see that robust procedures

for risk management are in place.

As detailed in the Strategy and Objectives section above,

and the Corporate Governance section below, the Group

has established a number of internal controls to manage its

risks effectively.

We regularly review our approach to risk management

and we take steps to ensure that we attract, develop and

retain the right people with the appropriate skills to identify,

collate and manage business risk. We aim to ensure

that emerging business risks are captured, appropriate

mitigations are in place and that we learn from our

experiences around the Group.

The Audit & Risk Committee has delegated authority from

the Board to oversee and review the effectiveness of

this risk control framework. The Committee has adopted

a Group Heat Risk Map that is updated regularly by the

executive management team and is reviewed by the

Committee periodically. All risks are categorised according

to potential impact and probability in order to determine the

Group’s exposure, and action plans are created accordingly.

The key risk areas potentially impacting on the business are

set out in the table below. Having increased our provision

for PII claims in the year, we consider it appropriate to

recognise that the probability and potential impact of our

litigation risk has increased. This, year, for the first time, we

have set out our views on the risks to the Group associated

with IT infrastructure, cyber and data security.

Increased risk No change since 2017 Decreased risk

Risk Potential impact Mitigation Trend

International risk

Risks associated with conducting

business in different jurisdictions around

the world include: economic, social or

political instability, fluctuations in currency

exchange rates, changes in foreign laws and

challenges presented by the outcome of the

UK’s EU Referendum.

Ability to win new contracts, deliver them

profitably and collect cash in a timely manner.

WYG mitigates a major part of this risk by contracting mainly

with UK, European and other governments and international

finance institutions, meaning that business, contractual and

payment risk is minimal.

Significant movements in foreign exchange rates

could affect sterling profits and the values of

assets and liabilities on the balance sheet which

are valued in foreign currencies.

Despite fluctuations in exchange rates, the Group does not

at present consider it necessary to hedge such investments

since the majority of its operational income and expenditure

is incurred in the same currencies, notably the Euro.

Following the Brexit vote, the possibility that UK

owned or registered entities will no longer be

eligible to bid for certain EU-funded contracts

or may be considered less commercially

acceptable bidders.

We have created a new intermediate holding and

management company in the Netherlands to ensure that

we remain eligible under the relevant EU regulations to bid

for, secure and deliver work funded from the EU Budget and

EU Development Funds. The new company has inherited

the staff, and the financial and project track record of its

predecessor company.

Working in fragile and conflict affected states

We operate in some countries where there

is a heightened risk of crime, kidnap, terrorist

related activity and potential exposure to

disease. In some cases, the Group works for

or alongside Government agencies which

may afford greater protection but can also

increase our risk of being targeted.

Increased security and health risks for staff

working on projects abroad.

The Group has extensive safety and security policies and

procedures in place, a dedicated and experienced security

team and technological back up.

Delays, deferrals or cancellations of projects for

reasons outside the Group’s control.

The Group has contracts in place which enable it to track,

support and provide medical and security advice (including,

if necessary, emergency repatriation) to all its employees on

a worldwide basis.



Security and crisis

Global political instability, acts of terror,

natural disasters and opportunistic or

serious crime across a full spectrum of

operational areas constitutes a dynamic and

long-term threat to our staff, premises and IT

infrastructure.

Direct and indirect risks to staff, business

continuity, clients and other contractors as

well as the potential for brand and reputational

damage to the Group.

The Group has a well-established framework of security and

crisis response planning to address and mitigate the risks

and threats it may encounter. We monitor, respond, improve,

train and periodically test our security and crisis planning

through processes overseen by a Security Committee.

Market risk

The Group’s core markets continue to be

susceptible to economic changes and

market volatility.

A new, substantial downturn in one of our key

markets, or in a number of markets at the same

time, could have an adverse effect on the Group.

We mitigate this risk by keeping our direct and indirect

exposure to each of our markets under review, and by

implementing strategic plans to ensure a balanced portfolio.

Reductions in the number of opportunities,

increases pricing pressures and reductions our

operating margins.

The Group benefits from the spread in sector and

geographical diversity which provides some protection

against market changes in specific countries or sectors.

Government and EU spending

Each of the Group’s core market sectors

is heavily influenced by variations in UK

government spending programmes and,

in the case of the international business,

the spending programmes of the EU and

various overseas governments and other

international organisations.

Significant new reductions in UK government

or EU spending affecting sectors on which the

Group relies could have an adverse effect on the

business.

We have expanded our growth into international markets in

order to create a balanced risk portfolio.

Following the UK general elections in 2010 and 2015, major

public spending cuts were introduced. The majority of

those have now been implemented or announced and our

business model adjusted accordingly.

To overcome the peaks and troughs of the EU’s seven year

budget cycle we continue our efforts to diversify in our core

overseas markets

Key customers

Certain of the Group’s revenues are

dependent on it being designated an

‘approved supplier’ by a number

of customers

There can be no guarantee that the Group will

retain this status

The Group seeks to mitigate such risks by ensuring that it has

ongoing dialogue with these customers and by monitoring

closely its business relationships with them

Large, complex and potentially loss making contracts

WYG undertakes a number of large,

complex projects, some with tight margins

and others that are subject to factors outside

our control..

Underperformance on a major contract or series

of contracts, whether or not due to factors within

WYG’s control, could cause significant financial

loss and/ or reputational damage to the Group..

CDOP, WYG’s operating process, is a robust internal

framework for decision making. It sets out detailed,

mandatory project management principles, progress reviews

and authority limits at each stage of a contract from bidding,

through inception to completion and lessons learned.

We also mitigate this risk by taking on a balanced portfolio of

such projects to ensure that a significant loss on one is offset

by being on target or outperforming on the others..

Bribery and corruption risk

The Group operates in certain countries

where the inherent risk of bribery and

corrupt practices is higher than in our more

established stable markets..

Exposure to such practices may lead to loss-

making contracts, other financial losses and

an adverse effect upon the Group’s reputation

elsewhere.

We have a clearly defined ethics and anti-bribery policy

which is supported by training and internal checks.

Litigation risk

WYG operates in a number of markets in

which there is an inherent risk of claims for

alleged professional negligence.

In common with its competitors, WYG receives

professional negligence or similar claims on an

ongoing basis.

The Group is insured against the majority of professional

negligence claims and seeks to mitigate the risks of such

claims through its internal processes and controls.

30

Kirkstall Forge

“Number One Kirkstall Forge in #:Leeds has won lots of awards recognition recently, including the Golden Leaf award from @plants_artwork and the Property wellbeing Award from @PWNews. We’re proud to have contributed our #engineering and #infrastructure services.”

30



Key employees

The Group’s success depends, to a

significant extent, on the continued services

of its Directors and senior management

team who have substantial experience in the

industry and in their specific roles.

The loss of members of the senior management

team and of other suitably qualified employees

could be detrimental to the business.

We mitigate these risks through succession planning, our

overall performance and reward programme and our share-

based incentive scheme for senior management and setting

appropriate notice periods and restrictive covenants – and

we are prepared to act quickly if such a loss occurs.

Resourcing

In certain of our sectors, increasing

market strength has impacted upon

the employment environment resulting

in increased competition for talented

specialists and higher salary expectations.

Higher staff turnover rates and the loss of

associated knowledge.

Loss of associated clients.

Failure to attract and retain high quality staff

impacts the ability of the Group to win contracts

and grow the business.

We use a range of staff recruitment and retention methods

including social media, raising awareness of our employer

brand, re-launching our employee referral programme

and increasing the ratio of direct hires to agency hires.

We conduct regular reviews of salary and benefits,

benchmarking and realigning them as required to ensure

that we continue to attract and retain high calibre individuals.

Acquisition integration

One element of the Group’s growth

strategy consists of making selective, niche

acquisitions.

As seen with the acquisition of North Associates,

unforeseen difficulties in the integration of

acquisitions could result in increased expense,

loss of key customers, decline in profitability,

and disruption to the Group which could reduce

the value to the Group of the acquisition.

We conduct a thorough structured due diligence process

before making acquisitions.

We aim to negotiate terms which provide protection

against underperformance including earn outs, deferred

consideration and appropriate warranty and indemnity

protection.

As part of any acquisition we adopt an integration process

which addresses areas such as systems integration,

client management, Group wide processes and controls,

management of internal and external communications, staff

consultation and regular management reporting.

Health and Safety

Involvement in the construction industry

(including, for example, working at height,

underground, trackside, airside or close to

heavy machinery) gives rise to health and

safety risks for both our staff and third parties

Risk to staff, clients and other contractors as

well as the potential for reputational damage to

the Group

The Group aims continually to improve its health and safety

performance and has well established accident reporting

procedures and processes in place to mitigate such risks.

These are overseen by the Security Committee

IT Infrastructure, Cyber and Data Security

The Group’s daily operational activities

are dependent on having a robust IT

infrastructure..

Prolonged outage or corruption of the IT

infrastructure could result in failure to deliver

projects on time which in turn, could lead to loss

of customers and future business opportunities,

causing a decline in profitability, the potential

for reputational damage to the Group and

difficulties in producing timely and accurate

information for internal and external reporting..

The Group aims to continuously improve its IT infrastructure

which is in the process of being updated to ISO 27001 as part

of the ongoing cyber security project.

The Group undertakes regular back-ups and penetration

testing. There is insurance cover in place to mitigate against

business disruption..

Risks associated with cyber security are

constantly increasing. The Group recognises

the increased threats facing companies from

third-party attempts to exploit weaknesses

in cyber security..

Inadequate security could cause significant

business disruption and loss of sensitive

data. This could result in financial loss and/or

reputational damage to the Group.

The Group seeks to mitigate such risks by having access

controls, firewalls and virus checkers and has been awarded

the Cyber Essentials Security Certificate. Security awareness

training is now being made available to all employees. The

Group has created an Information Security Team to continue

to monitor and improve the Group’s IT security in light of

continuing threats.

The implementation of the General Data

Protection Regulation and changes to the

Privacy in Electronic Communications

Regulation has led to heightened awareness

across the EU of the rights of data subjects

and the responsibilities of data controllers

and processors

A lack of suitable procedures or inadequate

modification of existing business processes

could lead the Group to fail to comply with the

regulations leading to significantly increased

fines and reputational damage.

The Group has performed risk assessments, sought external

advice from specialists and introduced new policies and

procedures. Training is has already been provided to key

teams within the business that require it and is being made

more generally available to all employees.

32

Cementing our presence in East Africa

We celebrated the official opening our our new offices in both Ankara and Nairoi this year, The new office in Nairobi will act as a regional hub, cementing its presence in the region by providing support to ongoing assignments, particularly within conflct-affected states.

It will also serve as the focal point for business development in the region, with its location allowing for increased market intelligence and interaction with relevant parties on the ground.

32

33

“The Nairobi office opening shows WYG’s commitment

to the region and acknowledgement that Kenya

and the greater East Africa is a vibrant market – one that is

worth tapping into.”Winnie Awuor

Consultant at WYG, Nairobi


Corporate Responsibility

OVERVIEWA significant proportion of our business is based on social

and environmental projects. We believe that our work

in these fields helps to embed a culture of corporate

responsibility throughout the business and that the high

proportion of our business that is directly focused on social,

environmental and ethical outcomes delivers benefits for

our clients, employees and other stakeholders.

We understand that sustainability needs to be embedded in

our own business strategies, decision making and practices

at all levels and to that end, the Board, its committees and

the operational management of the business routinely

take account of social, environmental and ethical risks and

opportunities in their decision making.

Further details of our approach to Corporate Responsibility,

including employee welfare initiatives, are set out in the

Corporate Responsibility Report set out below on pages 56

to 61 of the Annual Report.

RESPONSIBLE TRADINGAs an international business, our people are expected to

be aware of, and give proper consideration to, all cultures

and economic groupings including disadvantaged and

vulnerable adults and children. We seek to comply with

the laws and regulations of the countries in which we

operate and, in response to recent concerns in the

international development sector, we have drawn up a

safeguarding policy.

We continue to seek closer engagement with our suppliers

so that together we can reduce the impact of our supply

chain on the environment, particularly with regards to

travel, transport and office products. We aim to work

with suppliers who are also environmentally aware and

can demonstrate sustainable practices. We manage

this through a careful selection process as part of which

our suppliers must complete an evidence-based pre-

qualification questionnaire. We check some of the answers

independently and audit suppliers periodically.

CO2 EMISSIONSWe continue to make a significant effort to make energy

savings and emissions reductions through the individual

office energy management plans introduced in 2011/12

and updated in 2015. Although we have seen a decrease

in overall CO2 emissions in the year, this is chiefly due

to the closure of business premises from previous year

acquisitions.

We publish our CO2 emissions and energy consumption

data in detail in the Corporate Responsibility Report rather

than in this section of the Strategic Report since the Board

is of the opinion that the nature of WYG’s business is such

that this data is not materially significant to the economic

decisions of shareholders.


Employee Diversity

New RecruitsMen 310 Women 266

54% 46%

BoardMen 5Women 1

SLT 1

(Senior Management Team)

Men 6 Women 1

Total Group2018: Men 1,041 Women 600Men 63% Women 37%

2017: Men 969 Women 599Men 62% Women 38%

63% 37%

Subsidiary Directors

1,2 Men 20 Women 5

80%

20%

86%

14%

83%

17%

1. Excludes two men who are also on the WYG plc main Board.

2. Excludes members of the WYG plc main Board and members of the Senior

Leadership Team who are also directors of trading entities which are included in consolidation.

WYG is committed to recruiting and retaining the best

available employees and we believe that encouraging

diversity amongst our workforce helps us to achieve this.

Our aim is that our workforce will be representative of all

sections of society and that each employee feels respected

and able to give their best. We believe that diversity helps

us to deliver a better overall service to our clients.

WYG is also committed to providing equality and fairness

for all in our employment and not discriminating on the

grounds of gender, gender reassignment, marital status

(including civil partnerships), race, ethnic origin, colour,

nationality, national origin, disability, sexual orientation,

religion or age.

In April 2018, we published our gender pay gap data in line

with Government requirements. The results can be found

the on the Government website: https://gender-pay-gap.

service.gov.uk/

Like many organisations in our peer group, our gender

pay gap is largely a reflection of the disproportionate ratio

of men to women at various levels of seniority within our

business. This is particularly the case within our senior

levels since those roles command higher salaries.

We have supported a number of initiatives to begin to

address the gender imbalance. These have included

the appointment of Marcia Marini as a non-executive

Director and incorporating unconscious bias training

into our graduate development programmes with the

intention of extending this to all hiring managers. We

are also supporting females with ambition to become

leaders through membership of the Women in Leadership

Association (WLA). This not only gives access to useful

resources and networking, but also allows for a number of

our females to become part of their mentoring programme.

We also have flexible working options to help our staff

to balance their personal commitments with their work

commitments and a number of flexible benefits that enable

all of our staff to tailor their benefits choices to their lifestyle.

We know that we still have some way to go not only on

gender diversity but also on diversity in its broader context

so that all our staff feel valued within a diverse and inclusive

workforce. Continuing to address our gender imbalance is

one key part of this goal.

GENDER DIVERSITY (as at 31 March 2018)

https://gender-pay-gap.service.gov.uk/

https://gender-pay-gap.service.gov.uk/


INTRODUCTION

Over the period as a whole, our Consultancy Services

business saw growth in almost all its main markets, albeit

not quite enough to absorb all of the impact of the issues

that affected the business in the first half.

Significantly lower than anticipated volumes of work under

major framework contracts, combined with the loss or

delay of certain new contracts we had previously expected

to win in the first half, led the Board to announce on 24

November 2017 that it was taking a more cautious view of

trading performance for the remainder of the financial year.

That guidance took account of:

• the impact of intense competition for senior talent in the Southern region of our Planning and Transport Planning business;

• the decision by the lead developer to defer investment in the proposed new nuclear power plant at Moorside which had severe knock on effects for many businesses, including Britain’s Energy Coast, a major client of the real estate consultancy, North Associates, which had its core operation in Cumbria;

• a review of major contracts which concluded that a small number of UK engineering projects were likely to deliver lower profitability than previously forecast; and

• continuing softness in the Polish market where, despite having completed most of the restructuring necessary in Poland and with the business starting to deliver better profitability from its reduced cost base, it appeared unlikely to achieve its targets for the year.

In the second half, having addressed the issues described

above, the Consultancy Services business delivered an

improved performance in both revenue and profit terms,

closing the year more positively.

It was also a year of two halves for our International

Development business. Having started the year slowly in

Africa, Rest of World/Multi-country (ARM), when two major

programmes we expected to mobilise during the early part

of the financial year were delayed, the business started to

perform in line with expectations in Q2 and, by December

2017, had begun to catch up some of the ground lost. Work

on both these major programmes is now progressing well.

By contrast, in Turkey, we enjoyed a strong first half,

making the most of the opportunities won in 2016/17 under

IPA I. Unfortunately, the second-half was characterised by

delays in new programmes being tendered under the next

funding cycle, IPA II. Although projects are now flowing

from IPA II, these delays meant that, for the year as a whole,

the International Development business saw a reduction in

revenue and profitability on previous years.

.

Business Performance


OPERATIONAL REVIEWOperationally, the Group was structured and reported throughout the financial year in line with our new organisational structure:.

GROUP REVENUE BY STREAM

ConsultancyServices

International Development

77.3% 22.7%

Consultancy Services – which included all our UK activities and those parts of our international business which operated in similar technical services fields and comparable markets i.e. Poland and Bulgaria



Consultancy Services

77.3% of Group Revenue

WYG’s Consultancy Services business generated a 3.0% increase

in revenue to £119.3m (2017: £115.8m) with an operating profit before

separately disclosed items and central overheads of £5.4m (2017: £8.4m).

WYG Consultancy Services provides expertise in a broad

range of services across the full lifecycle of projects in

property, assets and infrastructure, which makes us well

positioned to take advantage of growing opportunities

in our markets. During the period, we operated in three

divisions: Planning & Advisory Services, Asset & Project

Management and Infrastructure & Built Environment.

With effect from April 2018, we have been operating as

five units: Infrastructure & Built Environment, Programme

& Project Management (P3M), Surveying & Asset

Management, Environmental, and Planning & Transport with

a strong senior team in place to build upon our expertise in

each of these areas.

In Infrastructure & Built Environment, our architectural,

engineering and design teams continue to see good

opportunities not only in the education, highways and rail

markets but also for more innovative and efficient methods

of delivering our services such as BIM (Building Information

Modelling), VR (Virtual Reality) and GIS (Geographic

Information Systems). For example, our use of Level 2 BIM

on the Curzon Building on Birmingham City University’s

campus led directly to improved coordination between

the design and construction processes and generated

significant cost savings. We have delivered flagship projects

such as Southern Regional College’s £35m new campus in

Armagh, which won an award for procurement innovation,

and are working on the development of the Leeds City

College Quarry Hill campus. Our Highways team sees

the allocation of vehicle excise duty funding towards the

strategic road network and positive announcements in

the Road Investment Strategy which could see a doubling

investment in the network over the next funding period,

as presenting exciting new opportunities. Our work on

Leicester’s Haymarket Bus Station covered highways,

civil engineering and structural and M&E engineering,

demonstrating how we are able to bring together an

effective multi-disciplinary team to deliver prestigious new

schemes for our clients. In Rail, we have secured a number

of new projects in station support and environmental

planning in the UK, as well as feasibility studies for several

major new projects in Poland. In Nuclear, we are supporting

James Fisher Nuclear Ltd (JFN) in its four year contract

with Magnox to undertake decommissioning activities

on the Steam Generating Heavy Water Reactor (SGHWR)

at the Winfrith Site, Dorset. This is the biggest single

decommissioning contract outside of Sellafield for WYG

and positions us well for emerging opportunities in nuclear

decommissioning across the UK.

Our Programme & Project Management or P3M team

continues to focus heavily on a broad portfolio of defence-

related projects not only in the UK but also overseas,

with commissions as varied as a new urban development

district on part of the former Aldershot Garrison to the UK

Naval Support Facility at Mina Salman in Bahrain which

was formally opened in April 2018. This four year project

involved engagement with stakeholders at tri-service

level and with other governmental bodies both in Bahrain

and the UK and drew on the close cooperation of our

structural engineering colleagues. Leveraging the duty of

care expertise developed working overseas in the defence

sector we continue to grow our relationship with FCO

Services, providing support to them across a geographically

diverse asset portfolio. Our PMs and Cost Consultants also


work widely across the commercial, residential, and social

housing sectors and we have helped our clients deliver a

variety of new office and housing units across the UK.

Our Surveying & Asset Management business is

developing ways of digitising some of its core service

offering, generating efficiencies and competitive advantage

in our service delivery and continues to look at innovation

in other areas. In this business we combine our building

surveying, safety management, building consultancy,

asbestos and assurance services. A significant proportion

of our work comes through the energy sector. Although

uncertainty remains in the UK new build sector, we remain

confident that nuclear will be an important part of the

energy supply chain for the foreseeable future. We have

a strong nuclear capability built on a 30-year presence in

nuclear in West Cumbria. We have also been appointed

for new CDM (Construction Design & Management) and

acoustic requirements with EDF at Hinckley C, while

being well placed for the expected Moorside project.

Within the nuclear decommissioning market, we were

appointed on a new framework at Dounreay for asbestos

management consultancy complementing our design

and geo-spatial expertise in this very specialist sector.

In other energy markets, low carbon generation and

balancing infrastructure continue to be a focus for us. The

increasing economic viability of wind has led to new work

in planning and site support. Beyond our nuclear and other

energy work, we have longstanding framework contracts

for our facilities and asset management services with the

Ministry of Justice, Surrey County Council, Crossrail and

Sussex Police. We continue to provide our whole asset

management services across a number of other sectors to

UK clients with broad portfolios such as Network Rail and

Royal Mail, while internationally we support FCO Services

on projects all around the world.

Our Environmental business is also showing growth.

Residential and mixed use development remain the

major sources of our environmental planning work,

where we bring a good track record and our sustainability

principles together to inform master planning and

design. Infrastructure, in particular in highways, rail and

flood defence, also draws heavily on many of our geo-

environmental skill areas as does land regeneration,

particularly through our frameworks with National Grid and

Homes England. We recently began work at Perry Barr

in Birmingham on the site for the 2022 Commonwealth

Games Village and, we expect this major project, which

will ultimately deliver up to 3,000 new homes, new

infrastructure and transport, to transform that area as we

look to build our presence in the city.

We are the UK’s third largest planning consultancy with

more than 200 staff across our Planning & Transport

Planning practices. The UK government’s continuing focus

on residential construction is leading to an increase in our

work, including a growing number of proposals for large

scale greenfield development. We are also increasing our

activity in the retail and hotel sectors, while working across

the UK to build projects that use the combination of our

national coverage and local expertise. Our expertise in

Intelligent Transport Systems is enabling us to work with our

International Development Business to build state of the art

public transport systems and improved traffic management

in developing cities across the world including Nairobi. This

combination of our socio-economic and technical skills to

deliver infrastructure development is expected to deliver

further growth in the coming year.

A significant proportion of our work draws on more than one

of these disciplines and we are constantly looking at ways

to maximise the opportunities that our combined expertise

affords, while delivering as seamless and frictionless an

experience for our clients as possible. As we look to the

future, we expect our strategic focus on greater efficiency,

standardisation and digitisation across the business to

generate significant benefits both across the Consultancy

Services business and the broader Group.

As at 31 March 2018, the Consultancy Services business’s

order book had increased by 7.0% to £96.1m (31 March

2018: £89.8m).

4040

41

Case Study – Consultancy

Birmingham Conservatoire

The Royal Birmingham Conservatoire is one of the most ambitious, exciting and

successful educational projects that our civil and structural engineering teams have

worked on. On a confined city centre site, it provides five acoustically separated

performance spaces, including a 500-seat concert hall, alongside recording and

teaching facilities, a public exhibition space and more than 70 music practice rooms.

Opened in 2017, the Conservatoire is the first new, purpose designed teaching,

rehearsal and performance space built in the UK for over a generation and is part of

a £260m campus expansion programme for Birmingham City University (BCU). We

already had a long-term relationship with BCU, having provided multidisciplinary

services on the nearby Curzon Building, and were appointed in 2014 for both the

Conservatoire and the concurrent Phase 3 development.

Groundbreaking Acoustics

The central challenge of the design was the need to provide acoustic isolation of the

performance spaces and practice rooms. The tight footprint of the site and adjacency

of a major trunk road, with associated noise and vibration issues, compounded this

making placement of the main zones crucial to the success of the development.

To counter these issues, we designed an innovative ‘box-in-box’ construction.

This stacked the performance spaces as structurally separate concrete boxes

with acoustic isolation from each other, and the surrounding structure, provided

by dedicated elastomeric foundation bearings. Surrounding these performance

spaces, the public atria, exhibition spaces and bars are at the lower levels whilst

individual practice rooms, recording studios and teaching facilities are located at

the upper levels.

The largest box, the 25m high, 500-seat concert hall, accommodates a full orchestra

with an 18m clear span. This is positioned above two smaller boxes accommodating

the recital hall and a smaller experimental music space. At the other end of the

building, two further boxes, housing the East Side Jazz Club and organ room, are

also stacked one on the other.

Sophisticated Digital Collaboration

BIM (building information modelling) level 2 was applied throughout the design and

construction processes, from conception through to completion, to enabled this

complex structure to meet the needs of the university and provide cost efficiencies.

This sophisticated collaboration between the teams allowed combined architectural,

structural and services models to be collated, highlighting clashes and pinch points

and enabling potential issues to be quickly resolved.

The Conservatoire has provided BCU with a unique facility, the first of its kind in the

digital age, that offers a world class environment to inspire, impress and attract high

calibre students, internationally renowned performers and teachers to the University.


International Development (IDB)

22.7% of Group Revenue

WYG’s International Development business generated revenue of £35.1m

(2017: £36.1m) with an operating profit before separately disclosed items

and central overheads of £2.0m (2017: £4.7m)..

We generate our revenue from socio-economic, technical

and infrastructure programmes, organised on a sectoral

basis. The main sectors were:

• Public Financial Management (PFM) & Governance

• Monitoring, Evaluation & Learning (MEL)

• Human Resources and Social Development

• Climate Change & Adaption

• Infrastructure & Advisory Services

In 2017/18 we saw a significant increase in opportunities in

these sectors and we expect this favourable environment

to continue for the foreseeable future. In addition, as part of

our Brexit mitigation strategy, WYG has created a new legal

entity in the Netherlands, WYG International B.V., which has

been fully integrated with our IDB business in order to allow

continued access to our European Markets.

With two major contract wins funded by the UK

Government, we took an important step towards

diversifying our client-base beyond its historic dependence

on EuropeAid and World Bank. These were the multi-million

pound evaluation programme of the globally-operating

FCO Prosperity Fund Programme, and the “Climate Resilient

Infrastructure Development Facility (CRIDF) Phase II”, both

of which are now operating successfully in partnership

with HMG. The award of the FCO evaluation programmes

reinforces WYG’s strength in the niche MEL sector and

greatly expands our regional presence into South America,

SE Asia and China as well as consolidating in Africa, CIS and

Western Balkans.

The award of CRIDF II has bolstered the portfolio of

our Climate Change and Adaptation Division. Another

key project in this sector is the Sustainable Agriculture

Intensification Research and Learning in Africa (SAIRLA)

programme which is being jointly managed by WYG

alongside the Natural Resources Institute at the University

of Greenwich. SAIRLA is a five-year, £8 million programme

aimed at delivering more effective policies and investments

in sustainable agricultural intensification.

Our early intervention into migration mitigation through the

establishment of the Migration Partnership has secured

a number of new contracts, most notably the award of a

programme funded by the EU Emergency Trust Fund –

“Building Opportunities for Resilience in the Horn of Africa

(BORESHA)”.

Our Infrastructure and Advisory Services team has seen

a significant increase in revenue, mainly through the EIB

funded Western Balkans Infrastructure Facility (WBIF)

programme – where WYG either inputs or leads on three

major Infrastructure Project Facility programmes focusing

on project preparation in the energy, transport, environment

and social infrastructure sectors. WYG’s work with the

WBIF continues to provide opportunity for growth as the

highly successful facility is further extended both within the

Western Balkans and into other regions including Middle

East and North Africa.


Our Infrastructure & Advisory Services Division also

continued to lead the market in the water & waste water

sector in Turkey, where we are delivering six major

projects. We have also successfully completed our first

major project in the Turkish transport sector, “Turkey’s

National Transport Masterplan” and our first project in the

environment sector. We continue to make good progress

with our efforts to diversify in technical services and pursue

eligible opportunities with a range of public and private

sector organisations in relation to: soft environment (i.e.

climate change, agro-environment, environmental impact

assessment, eco labelling), transport (i.e. road safety,

capacity building for ministry of transport, accessibility of

passenger transport services), energy (renewables, energy

efficiency) and in other sectors in Turkey, Jordan, Lebanon

and the rest of the region.

The PFM Division continues to be very active in winning

work and project delivery, with wins in Somalia, Nigeria

and The Gambia, while Human Resources and Social

Development Division delivered a wide variety of

programmes in Turkey designed for institutional capacity

building, education, employment and social inclusion.

Now that the IPA II Instrument is beginning to come

through, WYG’s Turkish business has secured significant

wins, with the Town Twinning Programme and a project

designed to achieve a better functioning consumer

protection framework in line with EU Member States’

best practices.

The donor market, which underpins so much of what we do,

is showing signs of being highly buoyant as we move into

the next financial year, with the EU IPA (Instrument for Pre-

accession Assistance) II programme’s €1.2 billion projected

spend in the Western Balkans and Turkey where WYG has a

strong footprint, UK HMG pipeline becoming more tangible

and the EU Trust Fund releasing more opportunities.

This coming year we will be adding Risk & Security to our

sector portfolio.

Despite a difficult year impacted by significant delays,

we now expect to benefit from the results of a very busy

business development period and return to delivering

projects and increasing revenues.

At 31 March 2018, the International Development

business’s order book had increased by 27.4% to £70.3m

(31 March 2017: £55.2m.)

WYG plc Annual Report & Accounts 201844

45

Case Study – International Development

Intelligent Transport System in Nairobi

As Nairobi continues to grow as the social and economic hub of Kenya, so does

its traffic congestion. To address that concern, we have been helping the Kenya

Urban Roads Authority implement an Intelligent Transport System.

Funded by the Kenyan Government and the World Bank under the National Urban

Transport Improvement Project Programme, the project aims to deliver modern

computer and communications technologies to reduce congestion and accidents.

It also seeks to support real-time management of road networks to all road users’

benefit, including pedestrians.

Transforming transport networks

To transform the traffic networks, WYG is collaborating with German

consultancies, Gauff Consultants and Schlothauer & Wauer GmbH, in designing a

hundred various traffic junctions. Alongside those, we are installing an automated

traffic management centre that will relay traffic information based on data collated

through the system via devices such as red-light enforcement cameras. CCTV

and variable message signs showing traffic information will also be implemented

as additional traffic control measures.

That lack of traffic regulation in Nairobi has led to poor driving behaviour causing

many serious accidents. The high economic growth in the region only amplifies

this issue. To combat the congestion, the City authorities employ hundreds of

police to manage key junctions. The new junctions will release these officers to

fight crime, a significant secondary benefit of the junctions.

The new junctions will also support other transport proposals being developed

in the city. Like many other African cities, Nairobi has a loosely regulated public

transport system based on private mini-buses. The City is developing new Bus

Rapid Transport (BRT) routes that will provide high-quality, frequent-bus services

on key corridors. The new traffic signal junctions will support these services and

manage the interaction between private vehicles and the new buses.

Added benefits

While the use of technology and process automation will undoubtedly help

reduce congestion and manage daily travel responsiveness, it also yields many

other benefits, including improved safety and air quality, a wealth of data on traffic

flow, better planning of new infrastructure, and more.

Our experts are currently in the project’s first phase (15 months), planning and

designing, with tender documents expected for completion by next spring.

Implementation, as part of the second phase of the consultancy work (66 months)

is thereafter set to commence in 2019. During this phase, our team plans to

supervise the implementation and provide oversight and monitoring for the new

system including the implementation of a Traffic Management Centre.

46

Health & Wellbeing

Last summer’s WYG Active High Five! campaign involved climbing five virtual peaks (although some of our colleagues in Kenya climbed Mount Kenya for real). It was the most successful campaign to date, with 364 active participants, including our Senior Leadership Team.

46


People

As at 31 March 2018, we employed 1,641 employees (2017: 1,568). As

we deliver our plans for growth in the coming year we expect to see

employee numbers increase in a number of business areas in line with

our strategic plan.

The Board recognises that our people are our most

important asset: they drive and deliver our performance.

We greatly appreciate the personal and professional

commitment they have demonstrated throughout the

year. Working closely with our partners, our people

deliver expert advice, technical assistance and project

management to clients around the globe. Our work helps

to change, shape and enhance the world’s landscapes,

societies and economies. Therefore, attracting, developing

and retaining high calibre individuals is critical to the

ongoing success of the business. Competition for talented

employees is particularly intense in our sector so to provide

an environment in which people can thrive, we have during

the past year:

• Continued internal communications channels with:

- The Thread: a monthly electronic newsletter which has rapidly become a valuable source of information about individuals and activities around the business

- Quarterly team briefings: to share consistent messages, important knowledge and information on business performance with all employees personally, rather than in writing

- ASK WYG: a confidential channel allowing WYG employees to ask any question to any member of the leadership team and then be certain of an honest and timely reply with, in most cases, both the question and the reply being made available to all on the intranet.

• Improved employee engagement:

- Employee forum: a platform where elected representatives can express views freely and make suggestions on how we can improve business practices. It is also a place where ideas and new initiatives can be tested before they are implemented

- Global Engagement Team (GET): “One WYG” was the theme at the heart of this year’s programme, addressing a recurrent aspiration: how do we work and collaborate to become One WYG and offer our clients a unique value proposition?

- New office openings in Turkey, London and Nairobi

- BOOST social events: an initiative bringing together new and existing employees within a local office and allowing them to get to know one another around food, drinks and entertainment

- Launched our mental health campaign with ‘5 Ways of wellbeing’. Further campaigns are planned, including stress awareness and how to recognise the signs and reduce the key triggers of stress.

• Improved career development opportunities:

- Continued our Graduate Development Programme: a 36 month programme giving graduates the opportunity to learn how the business operates and develop their skills in key areas at the same time as progressing their professional development

- We have been working with the Trailblazer group of companies for the new Chartered Town Planner Degree Level Apprenticeship

- Developed and held apprenticeship assessment centres to identify early careers talent

- We are committed to developing our staff and recognise the value of secondments and job shadowing opportunities. Secondments are valuable opportunities to support career development and progression by offering the chance to increase skills, knowledge and experience working in new and different environments, without the disruption of moving permanently and whilst retaining continuity of employment

- We have continued to recruit and develop several apprentices into the business across a variety of

WYG plc Annual Report & Accounts 2018

roles and are supporting their progression towards their vocational qualifications. We currently have 11 apprentices ranging from existing employees to new starters engaged on business administration project management and accountancy apprenticeship standards.

• Improved benefits:

- Continued to conduct regular salary and benefits reviews, benchmarking and realigning as required to ensure that we continue to be able to attract and retain high calibre individuals

- Issued every individual with a total reward statement to ensure that they are aware of the true value of their benefits package

- Ongoing review of the flexible benefits offering to include additional benefits such as will writing and vehicle breakdown cover.

EMPLOYEE INVOLVEMENTOur success depends upon the continued commitment

and motivation of our workforce and it is our policy that

employees are kept informed of matters affecting their

employment and of our financial results on a regular

basis. The Group undertook an employee survey in 2017,

as they have done in previous years to gauge the views

of employees on a number of topics the results were

presented to the Board and at the GET event which 130 or

so employees attended.

Given the competition for quality people and the

challenging markets in which we operate we have looked

to use a range of resourcing methods such as social media

and a digital marketing campaign to raise awareness of

our employer brand, along with promoting our internal

Employee Referral Programme. Direct hiring has been a

major focus to minimise recruitment spend. We finished

the year on a 84% rate of direct hires. A large number of

recruits continue to be graduates who join in their chosen

specialism and, given their importance to the ongoing

success of WYG, we continue to run our successful

Graduate Development Programme, nurturing and

developing our graduates, as well as making use of the

Apprenticeship Levy.

Our strategy is about utilising multiple channels to source

high calibre candidates and, wherever possible, to seek to

grow our own talent and support them in achieving their

career goals.

49

WYG GET Together

The Big Paint, Liverpool, January 2018

49

50

Allerdale Council: Workington Leisure Centre

“Wow! Workington Leisure Centre is the Tourism and Leisure Winner at the #RICSAwards @WorkingtonLC @BetterNorth.”

50


Awards

This year our teams have maintained their strong track record for

winning major industry awards demonstrating that our people continue

to deliver work that is independently recognised as being outstanding.

The awards include:

BIM Awards 2018

Doing It: Project Manager/Cost

Consultant – Caolain Boyd

APM Yorkshire & the Humber

2018

Young Project Manager of the

Year – Will Pearson

British Expertise Awards 2018

Young Consultant of the Year

– Cara Buchan

APM Project Management

Awards 2017

Project of the Year: Glen Douglas

APM Project Management

Awards 2017

Social Project of the Year: Build

Back Better with Community

Action Nepal

2017 Property & Construction

Awards

Best Professional Services

Company

Brownfield Briefing awards 2017

Best re-use of materials on a

project

2017 RICS Northern Ireland

Infrastructure Award, Stoneyford

Integrated Constructed Wetland

RTPI South West Awards for

Planning Excellence

Excellence in Decision Making in

Planning

The Planning Awards 2017

Best Use of Heritage in

Placemaking

We have also been shortlisted for a number of prestigious awards including the NCE100 Awards, ACE Consultancy &

Engineering Awards, RICS Regional Awards, Ground Engineering Awards, RTPI Awards and CIEEM Awards.


Financial Review

Including our share of Joint Venture revenues, revenue for

the full year increased by 1.7% to £154.4m (2017: £151.8m).

Revenue in the second half was £78.2m (H1 2018: £76.2m).

A 9.5% increase in Consultancy Services revenue in the

second half was offset by the significant reduction in

revenue from our Turkish business as projects funded by

IPA I closed out, new projects funded by IPA II were slow

to come through and two major international projects took

longer to start than anticipated.

On a statutory basis, the Group made a loss before tax

of £5.3m (2017: £1.6m) on pre-Joint-Venture revenues of

£152.9m (2017: £150.5m). The statutory loss reflects an

increase of £2.5m in our provision for contract claims

and costs of £3.2m relating to the closure of the North

Associates business acquired in October 2015. Although we

have had considerable success in reducing the number and

value of outstanding liabilities from legacy businesses over

the past few years, in light of certain contract claims issues

from discontinued businesses, we decided in December

2017 that it would be prudent to increase this provision,

which is reported within separately disclosed items.

Adjusted* operating profit was £3.5m (2017: £8.8m)

representing a marked reduction in adjusted operating

margin to 2.3% (2017: 5.8%). This was caused by losses in our

real estate business; the high rate of turnover in headcount

within our Planning and Transport Planning businesses

leading to lower efficiency; delays in volumes on some

major frameworks; and revised expectations in relation to a

small number of engineering projects leading to a reduction

in margins. However, adjusted operating profit did improve

in the second half to £2.5m (H1 2018: £1.0m) and the rate of

staff turnover has started to reduce. Adjusted profit before

tax was £2.9m (2017: £8.2m).

* See note 2

Separately disclosed costs for the year (including share

based payments and amortisation of intangible assets) were

£8.3m. Key elements of this were: the increased charge for

PII claims of £2.5m announced in December 2017; £3.2m

of costs relating to the closure of the real estate advisory

business referred to above; amortisation of intangible assets

of £1.2m; and costs in relation to the strategic growth plan

and group wide restructuring.

Fully diluted earnings per share adjusted to exclude

separately disclosed items were 4.4p (2017: 11.9p). On a

statutory basis, the loss per share was 6.9p (2017: earnings

of 3.3p).

The primary component of finance costs is the charges

relating to our bond and banking facilities. Finance costs

were level at £0.6m (2017: £0.6m) reflecting our ongoing use

of the HSBC facility and the utilisation of advance payment

bonds to mobilise large programmes of international

development work.

The Group still has significant losses brought forward in the

UK meaning that it will continue to pay a reduced rate of

UK tax for the foreseeable future. We also generate profit

in many of our overseas activities, upon which we pay local

corporation tax.

The Group closed the year with net debt of £6.3m (31 March

2017: £2.5m). Our cash outlays have included the planned

application of £2.8m towards legacy issues (including

ongoing commitments on unoccupied offices), dividend

payments of £1.3m and c. £2.5m cash costs of restructuring

within the Group.

We have also been able to make some further capital

investment in upgrades to our offices and IT during the year

- most notably in our new London office at Angel Court and

our offices in Ankara and Nairobi.

Cash generation and the effective management of

working capital are fundamental to the business and cash

conversion is a key performance target for the senior

management team. Our working capital KPI, on an ‘after

payments received on account’ basis, improved to 74 days

(2017: 78 days) against our KPI target of 76 days. Cash flow

before legacy costs and investments of £3.0m (2017: £5.0m)

was weaker, chiefly as a result of the significant reduction in

operating profit, but operating cash conversion at 190% was

a marked improvement on the previous year (2017: 95%).


As at 31 March 2018, the Group’s order book was up

14.7% to £166.4m (31 March 2017: £145.0m) with our

Consultancy Services order book up 6.9% to £96.1m

(2017: £89.8m) reflecting continuing the strength of

infrastructure and planning markets, and our International

order book up 27.5% to £70.3m (2017: £55.2m). This healthy

pipeline of work, a substantial proportion of which is to b

e undertaken in the current year, gives a sound basis

for current year expectations.

PENSION SCHEMESThe Group has fixed residual liabilities in respect of one

defined benefit scheme (the White Young Consulting Group

Limited Retirement Benefit Plan (1986) (1986 Scheme)). On

20 March 2015, the 1986 Scheme was transferred to the

Financial Assistance Scheme and, in accordance with s161

of the Pensions Act 2004, is treated as having been wound

up from that date. Under a Court approved settlement,

WYG Engineering Limited will pay £3.2m into the 1986

Scheme in instalments over 12 years ending in 2025. Other

than this, WYG has no further liability to the 1986 Scheme

or any other defined benefit pension scheme.

TAX STRATEGY & POLICYWYG’s tax strategy is to organise and arrange its tax

obligations in the most efficient way for the Company

and its Shareholders having due regard to what may be

acceptable under local legislation or is accepted practice in

any territory in which the Group operates. The Group’s tax

policy is to comply with and meet its responsibilities under

local territory laws and regulations.

The Chief Financial Officer is responsible for the Group’s

tax strategy and all final decisions in respect of tax policy

matters. We require all significant tax policy and planning

issues raised by local tax advisers to be notified to the

relevant business Finance Director and then to the Group

Financial Controller if appropriate. Group companies are

expected to confirm that local filing requirements have

been complied with.

Group companies are required to provide for all taxation

liabilities arising under local taxation regulations on a

periodic basis at the estimated effective rate for the full

year and the full year tax charge is based on the tax

computations to be lodged with the tax authorities. In

exceptional circumstances, the provision for tax may differ

from the computation of liabilities to be submitted to the

authorities but such accounting treatment may only be

adopted after clearance to do so has been obtained from

the Group Financial Controller.

The Board seeks to ensure that the business strategies

and tax governance policies are aligned, are clearly

communicated through an effective operational framework

and appropriate controls to mitigate key risks are

implemented.

TREASURY OPERATIONS Our policy on treasury and financial risk is set by the Board

and reviewed on a regular basis. The treasury risk faced by

the Group includes credit risk and foreign exchange risk,

details of which are in note 20.

It is our policy that we do not speculate in financial

instruments or enter into speculative transactions. The

types of financial instruments we use include internal cash

resources, borrowings, bonds and receivable and payable

balances arising directly from Group operations.

The majority of revenue and expenditure from operations

is denominated in the same currency giving an effective

hedge to relevant transactions. A proportion of our net

assets is denominated in Euros.

KEY PERFORMANCE INDICATORSWe identify and set key performance indicators (KPIs)

at different levels throughout the business. At the Group

level the main focus of our analysis is on the KPIs and

performance measures the Board has set for financial

performance, operations and efficiency, and growth.

54

Woodland View

“Our #multidiciplinary #experts helped inegrate an essential mental health facility, Woodland View, into North Ayrshire Comunity Hospital in #Irvine, delivering value #engineering to reduce capital and running costs.”

54

55WYG plc Annual Report & Accounts 2018 55

FINANCIAL PERFORMANCEUnder this heading we assess our performance on revenue,

profit and cash. We link executive Directors’ pay to these

financial KPIs through the bonus scheme (STIP) by setting

specific targets relating to profit before tax and separately

disclosed items, cash conversion and revenue.

OPERATIONS AND EFFICIENCYThese KPIs include measures to assess order intake,

utilisation, earnings per person, working capital days, the

proportion of direct (i.e. fee-earning) staff to indirect staff,

and claims.

GROWTHKPIs measured under this heading include: order book,

international revenue, the split of international public and

private work, and the conversion rates of expressions of

interest to bids and bids to contract wins.

Within each business segment the metrics we use to

assess KPIs can vary considerably, so we use a variety of

methods to measure performance against the KPIs. For

example, an acceptable level of order intake or earnings per

person may be very different in a part of the business where

we undertake a large volume of relatively small projects as

compared with one where we work on a small number of

very long-term projects. ‘Traffic light’ reports are produced

for monthly management meetings. Where concerns are

identified, the Board requires targeted mitigating measures

to be identified, put in place and reported upon.

In addition, we have KPIs for:

Health & Safety – measured by reference to near misses as

well as reportable incidents.

Technical excellence - intended to measure and improve

the technical quality of solutions and services we provide to

our clients and measure our profile in the technical press.

Leadership & Line Management - this is predominantly

measured through our annual employee survey and

through key indicators such as retention rates and feedback

from leavers.

Staff Satisfaction – this is measured through a number of

methodologies:

• our annual employee survey

• employee retention rates

• employee absence

GOING CONCERN BASISHaving taken into account the Group’s financial and trading

performance in the reporting period and undertaken

a careful review of the Group’s budget, cash position,

order book and the committed facilities available to it, the

Directors have formed the conclusion that the Company

and the Group have adequate resources to continue to

operate for the foreseeable future after taking into account

reasonably foreseeable risks and uncertainties relating to

its business. For this reason, the Directors continue to adopt

the going concern basis in preparing these accounts.

CONCLUSIONHaving posted a disappointing set of results at the half year,

the team has taken action to start to offset the issues we

highlighted in August and November 2017, and there have

since been several positive developments. Our Consultancy

Services business performed better in the second half,

consistent with our historical seasonal trading pattern. And,

despite the significant decrease in revenue coming through

our Turkish business in the second half, we met the market’s

revised expectations of our profit and cash performance

following the guidance we gave in November.

We have made good progress implementing our strategy;

extended our bank facility with HSBC; and completed a

significant step to stabilise WYG’s position in light of the

potential impact of Brexit.

Many of the major projects in both of our principal

business streams that were delayed in 2017, are now being

delivered, and our strong order book underpins a significant

proportion of FY19’s projected earnings. We have a clear

strategy in place, a reshaped leadership team and a strong

wider group with deep expertise in our chosen markets.

There is plenty of opportunity to build on this robust

platform and we are taking the right steps to return to

growth in profitability.

The Strategic Report has been approved by the Board and

signed on its behalf by:

Douglas McCormick Iain Clarkson

Chief Executive Officer Chief Financial Officer

5 June 2018 5 June 2018



Corporate Responsibility POLICYAt WYG we apply our skills to create a positive, sustainable

future for our business, society and the environment. We

define sustainability broadly, covering all of the social,

environmental and ethical aspects of what we do to help

our clients meet their own sustainability goals. We believe

that sustainability needs to be embedded in our own

business strategies, decision making and practices at all

levels and to that end, the Board, its committees and the

operational management of the business routinely take

account of social, environmental and ethical risks and

opportunities in their decision making.

BUSINESS ACTIVITYA significant proportion of our business is based on social

and environmental projects. During the past 12 months our

consultants in the UK have, among other things:

• supported Flintshire County Council in taking the first steps towards the realisation of the North Wales metro integrated transport network initiative, developing solutions to complete the gaps in the strategic cycle network

• continued our work with the Defence Infrastructure Organisation (DIO) to deliver projects as part of the Army Basing Programme. Most recent to date saw 322 new homes for Service personnel and their families in Wiltshire

• supported Jessica’s Sarcoma Awareness charity by securing outline planning permission for the development of respite lodges for the cancer charity

• we re-affirmed our commitment to the Armed Forces Covenant, supporting Armed Forces Day, the Poppy Appeal, Walking with the Wounded and numerous other

military events and causes because we have a strong bond with the Armed Forces and a long-standing history of working alongside service personnel in difficult conditions

• taken a lead in the redevelopment of a 120-acre brownfield site in Omagh to provide shared educational and sporting facilities for up to 4,000 students.

Overseas, the majority of our work is to support

international development funding agencies. Over the last

two decades we have built upon our skills and experience

to assist in strengthening societies by reducing poverty,

improving education and infrastructure, enhancing trade,

strengthening institutions and promoting social inclusion.

Our work this year has included:

• helping the Kenya Urban Roads Authority implement an Intelligent Transport System to help address its current traffic problem.

• working with the Employment Agency of Montenegro (EAM) and Social Work Centres (SWC), to determine services and solutions to combat hardships affecting disadvantaged groups in Montenegro.

SOCIAL VALUE AND COMMUNITY ENGAGEMENTAt WYG we are committed to the social value agenda and

we are proud of our efforts and achievements in this regard.

This is demonstrated by the range and scale of activities we

undertake to ensure we have a positive social impact on

our communities.

We provide our people with up to three volunteering days

per annum to support charities and worthy causes of their


choice. This programme is about working with the local

community, utilising their individual skills and capabilities

to improve local communities and the lives of those who

live there. In the past year our employees in the UK have

undertaken more than 1,880 hours of volunteering activities

on causes in our communities.

More information on how we seek to improve WYG’s

employer value proposition to support candidate attraction

and retention is set out in the Business Performance section

of the Strategic Report under ‘People & Awards’.

We have also matched the funds raised by our colleagues

in a number of individual and office-based fundraising

events for national and local charities, sponsored

community-based events and local volunteering. Among

the many initiatives this year we have:

• supported the repair or rebuild of over 30 projects in Nepal, following ‘Building Back Better’ principles, through our work with the Community Action Nepal charity. Our contribution has been recognized with numerous awards including from British Expertise International the Association for Project Management

• used a volunteering day to take part in the JLL Property Triathlon North at MediaCity (July 2017). We entered three teams from Leeds and Manchester offices, all of whom completed the 750m swim, 20km cycle and 5km run respectively

• helped raise over £20k for the British Legion’s Poppy Appeal

• raised money for a number of charities as part of our Employee Engagement campaign, High Five which was the most successful to date with 364 active participants logging 10,211 activities over the six week period.

We are proud to say that we have many individuals within

WYG that support our engagement with the community

through volunteering their own time and expertise,

undertaking activities such as:

• performing the role of non-executive director for local charities

• running and/or participating in local support groups

• acting as school governor, treasurer or parent association members

• participating in ‘getting ready for work schemes’ helping to prepare school leavers or ex-offenders for job interviews

• managing local clubs such as scouts, brownies and sporting teams

• managing international voluntary projects to ensure adequate healthcare for children in post-conflict affected areas

• undertaking sporting challenges to raise funds for the support of local and national charities.

58

Community Action Nepal

“After 3 long years we did it! We built it all back and we built it back better!”

Glyn Utting, 2018.

58

5959


THE BRIBERY ACT 2010Our procedures are designed to reflect the UK

Government’s guidelines in relation to the Bribery Act:

proportionality, top level commitment, proper risk

assessment, due diligence, communication (including

training), monitoring and review. Our guidance notes

and other anti-bribery resources, which were thoroughly

reviewed and updated in 2017, are available on our Group

intranet and our “anti-bribery” e-learning module has been

completed by all of our employees who work in areas we

consider to be high risk.

MODERN SLAVERY ACT 2015 - WYG SLAVERY AND HUMAN TRAFFICKING STATEMENT 2018

WYG plc and its subsidiaries (WYG) acknowledge that

slavery and human trafficking represent gross violations

of fundamental human rights. WYG fully supports the

implementation of the Modern Slavery Act 2015 and

seeks to operate in such a manner as to ensure, so

far as possible, that slavery and human trafficking do

not take place within our business or supply chains.

We recognise the importance of transparency in our

approach to tackling these issues and expect the same

high standards to be held by our contractors, suppliers

and business partners.

WYG’s Structure, Business and Supply Chains

As an international programme, project management and technical consultancy with a turnover of more than £150m, WYG comprises a number of limited UK and international companies headed by WYG plc. Due to the nature of our national and international development business, WYG’s supply chains consist primarily of other professional service providers whose employees have qualifications and skills that are unlikely to be exploited through forced labour. We assess the risk of modern slavery and human trafficking occurring in our business to be low but we recognise that no organisation can consider itself immune or afford to be complacent.

Our Policies on Slavery and Human Trafficking

WYG is committed to operating all aspects of our business in an ethical manner. Our Ethics Policy directly references our zero tolerance stance on slavery and human trafficking. Our Whistleblowing Charter also confirms that incidences and/or suspicions related to slavery or human trafficking must be reported. These and other relevant policies are reviewed annually and published on our intranet to ensure wide distribution. They are also part of our compulsory induction process for new employees.

Due Diligence Processes for Slavery and

Human Trafficking

Before they can start any work for WYG or on our behalf, our national and international suppliers are subject to strict checks to assess their compliance and suitability. Our Supplier Information Form and Pre-Qualification Questionnaires now directly enquire as to whether such organisations are covered by the Modern Slavery Act 2015 and, if they are, require them to provide a copy of their slavery and human trafficking statement pursuant to section 54(1). If they are not subject to the provisions of the Act, suppliers are required to provide details of their Modern Slavery Policy (or equivalent documents), any training or education offered and any due diligence processes they operate. The information received is scrutinised and further investigation taken where necessary.

Assessing and Managing RiskOur risk management processes seek to ensure that particular areas of risk in our business and supply chains are identified and impact assessments undertaken prior to the commencement of projects. In cases where a specific ethical concern has been raised, the ethical issues, including any related to slavery and human trafficking, will be referred to and considered by our Ethics Committee prior to the approval of project work.

Training

Given WYG’s limited risk exposure and our enhanced due diligence and other processes in place, we have decided not to implement specific training in modern slavery and human trafficking at this stage. However, in circumstances where we consider there may be particularly high risks, appropriate training will be developed and targeted at those personnel who may have direct exposure. WYG’s Ethics Committee will review this stance periodically.

This statement, which is also published on WYG’s website, is made pursuant to section 54(1) of the Modern Slavery Act 2015 and constitutes WYG’s slavery and human trafficking statement for the financial year ended 31 March 2018.


HEALTH AND SAFETY We remain committed to our award-winning high standards

of health, safety and welfare of employees and others who

may be affected by our activities. The health and safety

arrangements of our UK operations are certified to OHSAS

180001, as they have been since 2004. We have a robust

site inspection regime and seek to improve compliance

scores as part of long-term strategy supported by targeted,

independent site visits. We are committed to reducing the

number of lost time accidents and incidents across the

Group and continue to place a heavy emphasis on near

miss reporting to improve awareness and behaviour.

Accident and enforcement record

RIDDOR reportable accidents in the UK

Accident Frequency Rate (AFR)*

2017/18 2016/17 2015/16 2014/15 2013/14

–––Environmental incidents/near misses

Reportable incidents in the UK

2012/13

0.06 0.08 0.04 0.00

– –

0.000.04

*AFR = Total number of reportable injuries x 100,000

Man hours worked

6262

63

NEWS – Army Basing Plan, Salisbury Plain

Archaeologists working in Wiltshire identified a unique network of First World War tunnels under Salisbury Plain.

The tunnels are part of a First World War battlefield used

to train men to fight in and under the trenches of France

and Belgium. The soldiers have left the mine galleries deep

in the Wiltshire chalk but they have also left their names –

over a hundred inscriptions written by soldiers training on

Salisbury Plain between 1915 and 1918.

The trenches and the tunnels beneath them have been

found during archaeological work in advance of new Army

housing at Larkhill on Salisbury Plain. Archaeologists have

been working alongside specialist engineers and tunnel

specialists to investigate the underground battlefield.

The First World War is famous for its miles of trenches.

Trench systems also included dugouts - underground

chambers used as troop shelters, headquarters, medical

posts and stores - that were relatively safe from the bombs

and bullets on the surface but mining also had more malign

purposes. Both sides dug tunnels under no-man’s-land

between the opposing trench lines. Once under the enemy

trenches they laid large explosive charges to blow holes

in the lines of trenches. Both sides played cat and mouse,

digging towards each other and trying to stop the enemy

from placing their explosives.

At Larkhill there are dug outs and there are underground

mines snaking under no-man’s-land with the defenders’

counter-mines seeking them out. There are listening posts,

where soldiers used stethoscopes to hear the enemy

miners’ pick axes at work. There is also evidence of soldiers

learning how to lay small charges to blow the enemy tunnel

and bury the enemy soldiers alive.

Martin Brown (WYG) Archaeological Consultant to the

Army Basing Project said

“This is the first time anyone has found and excavated

tunnels used to train the sappers and miners before they

were deployed overseas. We have found them as part

of the largest single investigation of First World training

trenches anywhere in the world. Our excavations have

revealed this story for the first time. That we didn’t expect

these underground remains shows that much remains left

to discover, even from only a century ago.”

Leaving their mark – 100 years on

Soldiers training in the trenches have left their names to

be found by the archaeologists. Over one hundred pieces

of graffiti have been found written on and carved into the

chalk of trenches, dugouts and tunnels. The names include

men who died, others who survived, decorated heroes

and one deserter. The names come from Wiltshire men in

the Wiltshire Regiment, from West Yorkshire coal miners,

drafted in to work underground for King and Country, from

the two Halls brothers who signed their names and wrote

“Semper Fidelis” (Ever Faithful) beneath. A poignant “RIP

19 Manchester Scouts” may recall friends from pre-war

Scouting adventures killed in action.

Soldiers from all over Britain wroite on the chalk and there

are lots of Australian names too, recording men from the

Australian Third Division, who trained on Salisbury Plain

in 1916.


Responsible Trading & CO2 Emissions

We continue to make a significant effort to make energy

savings and emissions reductions through the individual

office energy management plans introduced in 2011/12 and

updated in 2015.

The tables and charts below (which are calculated using

the World Resources Institute’s GHG Protocol Tools

including the International Energy Agency) illustrate our

total greenhouse gas emissions in the UK and key overseas

offices for the past five years, being the period for which

we have usable data, an analysis of the key sources of

those emissions, and the ratio of such emissions per square

metre of UK office space. Water consumption based on

billed cubic metres of water used in UK offices is assessed

as low in significance and is omitted from reporting (due to

reduction measures already in place).

During 2018 we will be developing and seeking

accreditation of an energy management system to ISO

50001. This will enable the Group to comply with the Energy

Savings Opportunities Scheme (ESOS) Regulations 2014

and put in place more robust methods for collecting and

reporting energy usage.

TABLE 1: CO2E (TONNES) EMISSIONS BREAKDOWN BY METHOD

3

UK utilities

Fuel cards4

Overseas

utilities2 5 6

Cars and

vans

Public

transport1 2

2017

2017

2017

2017

2017

2016

2016

2016

2016

2016

2015

2015

2015

2015

2015

2014

2013

2014

2013

2014

2013

2014

2013

2014

2013

556.06

273.36

0.26

1,098.03

1.526.52

747.94

605.80

1.5

971.04

1,416.66

875.1

254.72

31.18

959.14

1,295.39

851.63

601.66

578.72

440.60

1.30

0.00

830.86

722.34

80.72

75.24

TOTAL EMISSIONSCO2e (tonnes)

2013 20152014 2016 2017

3,454

1,8402,343

3,4163,738

1 Public transport is the mileage from journeys by train

(including London underground and metros) and air

travel (domestic, shorthaul and longhaul).

2 No air travel or overseas utilities data is available for 2013

3 Realigned to calendar year for better reporting in line

with CDP reporting

4 Fuel card usage was lower in 2014 due to the changeover

in the supplier of pool vehicles. Mileage was captured

during the temporary use of hire vehicles. Fuel card

usage increased again in 2016 but reduced in 2017 as fuel

cards were restricted to pool vehicles only.

5 There was an increase in overseas utilities reported in

2015 but we moved into fully serviced offices from 2016

meaning that usage returned to its previously low levels.

1 UK Utilities is the combination of electricity, gas and oil

and overseas utilities is electricity only.

2 Excludes fully serviced managed offices for which no

data is available. These excluded offices are captured via

landlord reporting in accordance with ESOS 2014.


2017

Fleet (cars and vans)1

Rail (Network Rail)

Air2

TOTAL9,584,879

miles

2013 2014 2015 2016

2,522,151 2,780,2213,259,415

833,404997,123

3,037,303

1,401,054

3,343,706

3,944,125

1,466,301

3,894,760

4,243,076

1,447,043TOTAL

3,355,555 miles

TOTAL3,777,344

miles

TOTAL7,697,772

miles

TOTAL8,754,132

miles

BUSINESS MILEAGE BY METHODWe collect data on our business mileage. The information

in the table below is taken from UK company business

mileage expense claims and fuel card data which provides

the total amount of litres consumed. Public transport is

the mileage from journeys by train (including London

underground and metros) and air travel (domestic, shorthaul

and longhaul). To enable better and more timely reporting

we have realigned our GHG reporting to the calendar year.

With an expanding business and international geographical

footprint, our business mileage per person has increased

during the year. Nevertheless, through our investment

in better technology, greater use of that technology for

meetings and placing greater emphasis on the importance

of controlling costs and reducing our impact on the

environment we continue to bear down on travel and

travel costs.

Electricity (Kwh)

0

1

2

3

4

5

2014

2013

2015

2016

2017

3.80

2.88

3.47

4.71 4.61

Gas (Kwh)

2014

2013

2015

2016

2017

0.330.450.41 0.44 0.49

NOTES:

1. CO2 (Kg) per square metre is based on the calculation of

total energy against the Group’s UK property footprint.

Energy consumption is based on billed Kwh usage of gas

and electricity within UK Offices and oil consumption in

litres within UK Offices. In summer 2015 the Group ceased

to use oil for heating within its offices.

2. Excludes non-UK offices where data is unavailable

3. Excludes fully serviced managed offices for which no

data is available. These excluded offices are captured via

landlord reporting in accordance with ESOS 2014.

1 Includes grey fleet and pool vehicles. 2 No air data is available for 2012-13 or 2013-14. 3 Realigned to calendar year.

TABLE 2: TOTAL CONSUMPTION (CO2e (KG) per m2) PER FUEL USED IN UK OFFICES


Directors

Jeremy Beeton CB

Non-executive Chairman (65)

Jeremy Beeton was appointed to the Board in October 2015 and took over as

Chairman in September 2017. He has more than 40 years’ international business

experience of Government, private and public companies, project management,

construction and facilities management. He is currently a non-executive director

of SSE plc, John Laing Group plc and OPG plc, and serves on the advisory

board of PricewaterhouseCoopers LLP and the governing Court of Strathclyde

University. He was Director General of the UK Government Olympic Executive

from 2007 until the handover of the Olympic baton to Rio de Janeiro at the

conclusion of the London 2012 Olympic Games. Between 1999 and 2007, he

was Principal Vice President and Director of Bechtel Ltd. He is a Fellow of the

Institution of Civil Engineers.

Douglas McCormick

Chief Executive Officer (56)

Douglas was appointed as CEO of WYG effective from 12 June 2017. He has

over 30 years’ experience in the construction industry, and was previously

Chief Executive Officer of Sweett Group plc. During his 18 months in that role

Douglas established a period of improved stability, creating significant value for

shareholders. Prior to that, Douglas was Group Managing Director, Rail, Atkins

(UK). He is a Fellow of the Royal Institution of Chartered Surveyors and holds an

MSc in Construction Management and a BSc in Quantity Surveying. In addition,

he is a non-executive Director of the Institute for Collaborative Working.

Iain Clarkson

Chief Financial Officer (51)

Iain joined WYG in June 2016. Previously he was Finance Director for Amec

Foster Wheeler’s Clean Energy business. Prior to that Iain held various Finance

Director positions in Westinghouse Electric Company, a global nuclear

technology provider, including two periods spent working in the United States.

Iain started his career with PWC where he qualified as an ACA before moving

into Corporate Finance to work on Mergers & Acquisitions. He moved across

into industry in 1996 and now has over 20 years’ financial leadership experience

in international consulting and engineering businesses and has a particular

specialism in the international energy sector.


David Jeffcoat

Non-executive Director and Chairman of the Audit and Risk Committee (68)

David Jeffcoat was appointed to the Board in December 2009. He is a qualified

accountant with extensive experience in the engineering and technology

sectors. He was Group Finance Director and Company Secretary of FTSE

250 manufacturing group Ultra Electronics Holdings plc from 2000 until his

retirement in April 2009. Prior to that, he served as Group Financial Controller

with Smiths Industries plc (now Smiths Group).

Neil Masom OBE

Senior Independent Director and Chairman of the Remuneration Committee

(59)

Neil was appointed to the Board in October 2015. He was appointed to the board

of HS2 in September 2014 as Director and Audit Committee Chair, and also

holds non-executive director roles at IFS AB, a PE backed Swedish software

company, and CQC Holdings Ltd. He was formerly non-executive Chairman

of FCO Services. Neil is a Chartered Engineer whose previous executive roles

have included some 30 years with BAE Systems culminating in the position of

Managing Director, Logistics and Information Systems.

Marcia Marini

Non-executive Director (50)

Marcia Marini joined the Board as a Non-Executive Director in January 2018.

She has 25 years’ experience in senior roles in a wide range of businesses and

sectors with private and not-for profit entities, a strong management consultancy

background, and has also worked extensively with Government agencies,

particularly in the UK. Marcia is also the founder of Ancora Consulting Limited, a

management consultancy firm and, as a senior organisational development and

change management professional, she now consults with many small, medium

and large corporations.


Directors’ Report

The Directors present their Annual Report

and the audited accounts of the Company

and its subsidiaries (Group) for the year ended

31 March 2018.

REVIEW OF OPERATIONSWYG plc is incorporated and domiciled in England. The

address of its registered office is Arndale Court, Otley Road,

Headingley, Leeds LS6 2UJ.

As required by the Companies Act 2006, a review of the

Group’s business, together with an indication of its future

prospects and a description of the principal risks facing the

Group, is provided in the Chairman’s Statement on pages 4

to 8, the Strategic Report on pages 18 to 55 and in the five

year financial summary on page 130.

Details of the Group’s subsidiaries are listed on pages 113 to

114. The Group also has branch offices in Kurdistan, Russia

and South Africa and a representative office in Serbia.

SHARE CAPITAL The Company’s ordinary shares are traded on AIM, a market

operated by the London Stock Exchange plc.

Accordingly, as at 31 March 2018, the Company’s share

capital was as follows:

72,669,665 ordinary shares of 0.1 pence each

4,540,758 convertible shares of 0.1 pence each

There are no shares held in treasury. The rights and

obligations attaching to each class of shares are set out in

the Company’s Articles of Association which are available

on our website.

DIVIDENDAn interim dividend of 0.6p was paid to shareholders on 4

April 2018. Subject to the approval of shareholders at the

AGM, a dividend of 1.2p will be paid on 3 October 2018

to ordinary shareholders on the register at the close of

business on 7 September 2018 bringing the total dividend

for the year to 1.8p.

EMPLOYEE BENEFIT TRUSTThe Company’s Employee Benefit Trust (EBT) was

established to satisfy awards granted under the Company’s

share options plans. The trustees of the EBT are RBC Cees

Trustees UK Limited which is resident in Jersey. As at

31 March 2018, the EBT held 25,500 Ordinary Shares.

DIRECTORS The Directors of the Company who served during the year

and up to the date of the signing of the financial statements

were as follows:

Jeremy Beeton

Mike McTighe (resigned 21 September 2017)

Douglas McCormick (appointed 12 June 2017)

Paul Hamer (resigned 9 June 2017)

Iain Clarkson

David Jeffcoat

Neil Masom

Marcia Marini (appointed 1 January 2018)

The biographical details of the Directors can be found on

pages 66 to 67.


DIRECTORS’ ELECTION AND ROTATION David Jeffcoat who will shortly complete the maximum

nine years’ service on the Board during which he could be

deemed an independent non-executive under the Code,

has confirmed that he will retire from the Board at the

conclusion of the AGM and will not be seeking re-election.

In accordance with the Articles of Association, which

require that any Director appointed during the year shall

hold office only until the next AGM and shall then be eligible

for election, Marcia Marini is seeking election at the AGM.

Marcia Marini’s biographical details are set out on page 67.

DIRECTORS’ INTERESTSThe beneficial interests of the Directors of the Company

and their families in the ordinary shares of the Company

and their options and/or awards over shares comprised in

the Company’s share schemes are detailed in the Directors’

Remuneration Report on pages 75 to 78.

No Director had any interests in any contract with the

Company or its subsidiaries at any time during the year

other than those arising from their service contracts or

letters of appointment and through the Company’s share

option schemes.

The Company maintains insurance to cover directors’ and

officers’ liability.

DIRECTORS’ INDEMNITIESAs permitted by the Companies Act 2006, the Company

has indemnified the Directors in respect of proceedings

which may be brought by third parties. Neither the

Company’s indemnity nor its insurance provides cover in

the event that a Director is proved to have acted

fraudulently or dishonestly.

GREENHOUSE GAS EMISSIONS (GHG) REPORTINGThe Group’s report on GHG emissions is contained within

our Corporate Responsibility Report on pages 64 to 65.

CORPORATE GOVERNANCEThe Group’s statement on Corporate Governance is

included in the Corporate Governance Report on pages 71

to 74 of this report.

ANNUAL GENERAL MEETINGThe AGM will be held at the Company’s registered office at

Arndale Court, Otley Road, Headingley, Leeds LS6 2UJ on

25 September 2018 at 10.00am. Formal notice of the AGM,

will be communicated separately to shareholders and on

the Company’s website at www.wyg.com at the

appropriate time.

SIGNIFICANT SHAREHOLDINGS

Artemis Investment Management

Slater Investments

Cannacord Genuity Wealth Management

AB Traction

Robert Keith

Miton Asset Management

Janus Henderson Investors

AXA Framlington Investment Managers

14,002,192

9,540,000

8,195,000

6,666,153

6,337,000

4,983,861

4,800,000

2,500,000

As at 15 May 2018 the Company had been notified of the following interests in 3% or more of its issued share capital:

Number of shares held % issued share capital

http://www.wyg.com


SUBSTANTIAL CONTRACTS AND CHANGE OF CONTROLThe Group has in place various contractual arrangements

with customers and suppliers some of which provide for

termination in the event of a change of control but none of

which is considered to be significant in terms of its potential

impact on the business as a whole.

The Group also has a revolving credit facility with HSBC

Bank plc which provides that the facilities may be cancelled

in the event of a change of control.

TREASURY POLICYThe Group’s policy on treasury and financial risk is set by

the Board and is subject to regular reporting and review.

The main risks faced by the Group relate to foreign currency

risk, credit risk, and cash flow. A more detailed explanation

of these risks and the Group’s policy for managing them is

set out on pages 28 to 31 and in note 20 to the Accounts.

EMPLOYMENT POLICIES Our policy is to ensure there is adequate provision for the

health, safety and welfare of our employees and of other

people who may be affected by our activities. In addition to

our robust duty of care and health and safety procedures

we are also committed to our employees’ wellbeing.

We support flexible working, and provide a Health and

Wellbeing Handbook which includes the provision of free

fruit, holistic health therapies, wellness checks, discounted

gym membership, nutritional advice and a health cash plan.

We also provide an employee assistance programme, free

of charge, to all employees that offers impartial advice and

support on issues such as personal finances, relationship

issues or stress management.

EMPLOYMENT OF DISABLED PERSONSDisabled employees and applicants are treated equally

with others having regard to their ability, experience and the

requirements of the job. We commit to making reasonable

adjustments to be able to offer employment or continued

employment within the Group.

DIVERSITYOur approach to employee diversity is set out in detail on

page 35 of the Strategic Report.

EMPLOYEE INVOLVEMENTOur success depends upon the continued commitment

and motivation of our workforce and it is our policy that

employees are kept informed of matters affecting their

employment and of our financial results on a regular basis.

We describe in the People section of the Strategic Report

on pages 46 to 49 how we encourage employees to

share their views, ideas and feedback; how we respond to

their views and how we communicate with them through

different channels.

POLITICAL DONATIONSThe Group made no political donations (2017: nil).

GOING CONCERNAs explained in the Strategic Report on pages 18 to 55,

the Directors continue to adopt the going concern basis

in preparing these accounts.

STATEMENT ON DISCLOSURE OF INFORMATION TO THE INDEPENDENT AUDITOREach of the persons who is a Director at the date of the

approval of this annual report confirms that there is no

relevant audit information of which the Company’s auditor

is unaware.

Each Director has taken all reasonable steps to make

himself aware of any relevant audit information and to

establish that the Company’s auditor is aware of that

information. This confirmation is given and should be

interpreted in accordance with the provisions of s418 of the

Companies Act 2006.

INDEPENDENT AUDITORDeloitte LLP has expressed its willingness to be re-

appointed. A resolution to re-appoint them as independent

auditor will be proposed at the AGM.

By order of the Board

Benjamin Whitworth

Company Secretary

5 June 2018



UK CORPORATE GOVERNANCE CODEWYG is committed to high standards of corporate

governance throughout the Group.

As a company whose shares are traded on AIM, WYG is

not required to comply with all the requirements of the

UK Corporate Governance Code (Code) published by the

Financial Reporting Council in 2016. However, the Board

continues to implement policies and procedures designed

to comply with the Code so far as reasonably practicable

and appropriate for a public company of its size and

complexity and in the light of the nature of the risks and

challenges it faces.

This report sets out how the principles identified in the

Code have been applied by the Group in the financial year

to 31 March 2018.

THE BOARD The Board currently comprises a Non-executive Chairman

(Jeremy Beeton), two Executive Directors (Douglas

McCormick, Chief Executive Officer and Iain Clarkson,

Chief Financial Officer) and three Non-executive Directors

(David Jeffcoat, Neil Masom and Marcia Marini). The Board

considers Jeremy Beeton, David Jeffcoat, Neil Masom and

Marcia Marini to be independent.

The roles of Chairman and Chief Executive are separate

and clearly defined in writing. The Chairman is responsible

for the leadership of the Board and for monitoring its

effectiveness. The Chief Executive is responsible for the

executive management of the Group’s business.

All Directors are subject to election by the shareholders

at the first opportunity after their initial appointment to the

Board and to re-election thereafter at intervals of not more

than three years. Biographical details of the Directors are

set out on pages 66 and 67. The Non-executive Directors

bring a balance and range of skills and experience to the

Board and its committees. None of the Executive Directors

holds non-executive directorships outside of the Group

although Douglas McCormick is a non-executive Director of

the Institute for Collaborative Working.

The Board is collectively responsible to shareholders for the

Group’s overall strategy and direction within a framework of

controls which enables risk to be assessed and managed.

It has a schedule of matters reserved to it for decision,

including: strategy, policy, approval of budgets, acquisitions

and disposals, major capital expenditure, and a risk

assessment and assurance.

An evaluation of the performance of the Board was last

conducted in 2015. The Chairman reviewed the outputs

from the evaluation with each Director individually and

the conclusions of the overall assessment were reviewed

by all the Directors. The Board does not consider that an

externally facilitated evaluation is appropriate at this stage

of the Group’s development. Following the significant

changes to the Board in 2017 and 2018, the Company

intends to conduct an evaluation of its performance in 2018.

As regards the diversity on the Board, we believe Board

composition is a key element of Board effectiveness. Each

member and potential member of our Board must be

able to demonstrate the skills, experience and knowledge

required to contribute to the effectiveness of the Board.

WYG believes that the Board’s perspective and approach

can be enhanced through gender, age and cultural diversity

and we support the principle of boardroom diversity. It is our

policy to consider overall Board balance when appointing

new directors and we will always seek to appoint on merit

against objective criteria, including diversity.

All Directors have access to the advice and services of

the Company Secretary, who is responsible for ensuring

that Board procedures and applicable rules and

regulations are observed. There is an agreed procedure

for Directors to take independent professional advice at

the Company’s expense, if necessary, in the performance

of their duties. Where it is considered appropriate, training

is made available to the Directors. The Company has

appropriate insurance cover in respect of legal action

against its Directors.


The Company’s Articles of Association permit the Board to

authorise directors’ conflicts of interest should they arise.

The Company maintains a register of interests which are

deemed to be permanently disclosed and authorised.

The register is updated annually and as and when a new

potential conflict of interest is notified. At each Board and

Committee meeting, Directors are prompted to declare

any conflict of interest. The Board (or Committee) then

authorises the conflict thereby enabling the relevant

Director to participate in and vote at the meeting or, where

applicable, to abstain or even to absent themselves from

the meeting.

BOARD MEETINGSThe Board meets formally on a regular basis. One meeting

each year is specifically reserved for a strategic review. The

Board is provided with management information which

includes detailed monthly management accounts which

include an analysis of the Group’s actual performance

against budget, latest forecast and the previous year. The

form and quality of the information are reviewed to ensure

that it is of a quality appropriate to enable the Board to

discharge its duties. In light of the challenges faced by

the Company during the year there were three additional

unscheduled meetings of the Board attended by all

available Directors to consider the financial performance of

the Company and review appropriate announcements.

The following table shows the number of years each

Director has served on the Board as at the financial year end

and their attendance at scheduled Board and Committee

meetings:

Name

Tenure (yrs)

in years Full Board

Audit & Risk

Committee

Remuneration

Committee

Nominations

Committee

Number of meetings held 9 4 3 1

Douglas McCormick1 1 8/8 - - 1/1

Iain Clarkson 2 9/9 - - -

David Jeffcoat 8 8/9 4/4 3/3 1/1

Jeremy Beeton 2 9/9 4/4 2/3 1/1

Neil Masom 2 8/9 4/4 3/3 1/1

Marcia Marini2 1 3/3 1/1 1/1 -

Paul Hamer3 9 1/1 - - -

Mike McTighe4 8 3/3 1/1 1/1 -

1. Douglas McCormick joined the Board on 12 June 2017.

2. Marcia Marini joined the Board on 1 January 2018.

3. Paul Hamer resigned from the Board on 9 June 2017.

4. Mike McTighe resigned from the Board on 21 September 2017.


COMMITTEES OF THE BOARDThe Board delegates certain specific responsibilities to

committees. Each committee has clearly defined terms of

reference which are reviewed annually by the Board. The

terms of reference for the Board and each of its committees

are available on our website at www.wyg.com

AUDIT & RISK COMMITTEEThe Audit & Risk Committee is chaired by David Jeffcoat.

David is a qualified accountant with extensive experience in

the engineering and technology sectors. He is considered

by the Board to have the necessary recent and relevant

financial experience for his role as chairman. The other

members of the Committee are Non-executive Directors

Jeremy Beeton, Neil Masom and Marcia Marini. The

Executive Directors also attend most meetings of the

Committee at the invitation of the chairman.

Key features of its terms of reference comprise:

• ensuring as far as possible the integrity of the Company and Group statutory financial statements

• making recommendations to the Board regarding the external auditor’s appointment, re-appointment and/or removal, and fees

• agreeing the scope and nature of the external audit process and considering the resultant reports prepared by the auditor

• monitoring the arrangements that the executive management has in place to identify and mitigate major operational, financial, reputational and other significant risks within the Group

• monitoring the effectiveness of the internal audit function, ensuring that it is independent, adequately resourced and has appropriate standing within the Group

• reviewing procedures for detecting fraud and ensuring that arrangements are in place whereby staff may, in confidence, raise concerns about possible improprieties in financial or other matters; and

• reviewing and approving the Group Finance Manual, including delegated authority levels, on a regular basis.

During the year the Committee met formally on four

occasions. The Committee also met the external auditor

without the presence of the Company’s executive

management to review the financial statements and discuss

any other relevant matters in confidence. The chairman of

the Committee also held informal meetings and telephone

calls with the Head of Internal Audit and the senior external

audit partner on a regular basis during the year.

The Committee chairman reports to every main Board

meeting on any relevant audit & risk-related developments

and provides copies of the Committee minutes and relevant

reports to all Board members.

A detailed description of the principal risks and

uncertainties facing the Group, the impact they might have

on the Group and the mitigation measures in place is set out

on pages 28 to 31 of the Strategic Report.

The Audit & Risk Committee also monitors the nature and

extent of non-audit work undertaken by the auditor. Details

of the fees paid to the external auditor for the twelve

months to 31 March 2018, the split between audit and non-

audit fees and information on the nature of non-audit fees

is included in note 4 to the accounts. The non-audit fees

paid to the auditor were not considered by the Audit & Risk

Committee to affect the independence of the auditor.

REMUNERATION COMMITTEEThe composition and role of the Remuneration

Committee is set out in the Directors’ Remuneration Report

on pages 75 to 78. Full details of the Directors’ remuneration

and a statement on remuneration policy

are included in the report.

NOMINATIONS COMMITTEEThe Nominations Committee comprises all the Non-

executive Directors and the Chief Executive Officer and

is chaired by Jeremy Beeton. The Committee’s terms of

reference include periodic reviews of the structure, size

and composition of the Board and the identification and

nomination of candidates for appointment to the Board.

The Committee also considers succession planning for the

Board and senior managers of the Group. During the year

http://www.wyg.com


The Committee met on a number of occasions to consider

the recruitment and selection of the new Chief Executive

Officer, Marcia Marini as a non-Executive Director and

succession planning generally. The Committee used the

services of an external search consultant. Detailed reports

on a shortlist of candidates were prepared for and reviewed

by the Committee before the final selection was made.

DIALOGUE WITH SHAREHOLDERSWe value the views of all our shareholders and recognise

their interest in our performance, strategy and objectives.

There is a regular dialogue with institutional investors,

fund managers, brokers, analysts and the media. These

meetings are generally conducted by the Chief Executive

Officer and the Chief Financial Officer. Feedback on these

meetings and copies of resulting analysts’ reports are

provided to the other members of the Board.

Formal communication with shareholders is mainly through

the Half Year and Annual Reports, face to face meetings

and online presentations. All shareholders are invited to

attend the AGM, which is attended by the full Board.

There is a comprehensive investors section on our

website, www.wyg.com, which is regularly reviewed to

ensure that all shareholders have access to the most

up-to-date information.

The Chairman and the Senior Independent Director are

available to shareholders at any time to discuss strategy

and governance matters. Non-executive Directors do not

ordinarily attend meetings with major shareholders but

would do so if this was requested.

Approved by the Board and signed on its behalf by:

Benjamin Whitworth

Company Secretary

5 June 2018


Directors’ Remuneration Report

REMUNERATION COMMITTEE The Remuneration Committee comprises all Non-executive

Directors and is chaired by Neil Masom.

The Remuneration Committee is mindful of the continuing

public focus on executive pay and, in particular, market

‘best-practice’ requirements for companies to show that

their executives’ pay arrangements are closely aligned with

the creation of shareholder value and the company’s long-

term strategy.

TERMS OF REFERENCEThe Remuneration Committee has clearly defined terms

of reference to determine, on behalf of the Board, all

aspects of remuneration of the Executive Directors

consisting of salary, pension, benefits, and annual and

long-term incentives. The Committee’s terms of reference

are reviewed annually by the Board. It is also kept advised

of and consulted on all aspects of senior management

remuneration across the Group. The Chief Executive Officer

is invited to attend meetings of the Committee but not

when his own arrangements are being considered. The

Chief Financial Officer attends and advises the committee

as required by invitation. No Director participates in

discussions about their own remuneration. The Committee

obtains regular governance updates from, and has available

to it the advice of, FIT Remuneration Consultants LLP.

Copies of the Committee’s terms of reference are available

on the Company’s website www.wyg.com

REMUNERATION POLICY The overall policy of the Board is to:

• attract, motivate and retain talented people at all levels across the Group

• provide competitive salary and benefit packages and

• encourage the holding of shares in the Company as an effective way of aligning the interests of the senior management team with those of shareholders.

BASIC SALARYThe Executive Directors’ basic salaries are reviewed by the

Committee each year taking into account individual and

Group performance. It uses as a comparator the salaries of

other companies of a similar size and complexity and the

level of base salary of other senior staff in the Group.

The Executive Directors have agreed not to seek an

increase in their basic salaries in FY 2019.

BENEFITSBenefits include a car allowance or a car and payment of its

operating expenses and fuel, life assurance and entitlement

to a non-contributory private healthcare scheme.

PENSIONSExecutive Directors are members of a defined contribution

pension scheme. Annual contributions are calculated by

reference to a percentage of base salary, with Executive

Directors each receiving contributions of 17.5% of salary.

The Executive Directors are not required to contribute. In

circumstances where the Company’s contribution to an

Executive Director’s pension scheme exceeds the annual

allowance permitted by HMRC, the executive is permitted

to elect to receive an amount equal to the excess as salary

in lieu of pension contribution. Any such payment is not

treated as salary for the purposes of calculating STIP or PSP

award opportunities.

MANAGEMENT INCENTIVE PLANSThe Company operates three share-based management

incentive plans which were approved by shareholders in

2015. They are:

• Short Term Incentive Plan (STIP) incorporating a Deferred Annual Bonus Share Plan (DABS) – an annual bonus arrangement for the executive Directors and senior management team which includes a significant element of bonus deferral in the form of cash and share-based payments which are subject to the achievement of demanding PBT and cash conversion targets;

• Performance Share Plan (PSP) – covering senior executive and leadership teams, vesting of awards being dependent

http://www.wyg.com


upon achievement of absolute EPS growth and TSR targets (measured against a peer group); and

• Restricted Share Plan (RSP) – covering other key senior employees

(together, the ‘Management Incentive Plans’).

The Management Incentive Plans are designed to retain

and incentivise existing talent, and to enhance our ability

to recruit new talent to support our growth ambitions, in

addition to aligning the interests of the Directors with those

of our shareholders.

The performance targets under the STIP and DABS Plan

are based on a combination of some or all of PBT, revenue,

cash conversion and orderbook, which have been selected

as the key factors in driving further growth of the Group,

and personal targets. The DABS plan contains a significant

element of deferred bonus which must be held as shares

which, in turn, seeks to encourage long-term holding.

The PSP is intended to ensure the alignment of our

executive team with shareholder objectives in using both

EPS and TSR targets as measures of performance and

growth. The PSP focuses on incentivising and rewarding the

delivery of stretching financial performance targets and to

reward the creation of long-term shareholder value based

on the delivery of growth of EPS and TSR.

The RSP seeks to encourage employee retention.

It is the Board’s intention that the Management Incentive

Plans will fall within the recommended “10% in 10 years

dilution” aggregate limit which will apply to all awards in

respect of new issues of shares made under the DABS Plan,

the PSP and the RSP. This limit is forward looking from the

2015 AGM and excludes dilution from any awards made

under the TIP (see below).

CASH PERFORMANCE RELATED ANNUAL BONUS AND DABS PLANExecutive Directors participate in a performance related

annual bonus scheme – the STIP; the maximum bonus

payable is 150% (2017: 225%) of salary. Bonuses can only be

earned if challenging performance targets determined by

the Committee at the start of the financial year are achieved.

Two thirds of any bonus outcome will be deferred for a

period of 3 years, one half of which (i.e one third of the

bonus outcome) will be deferred in the form of a cash

award and one half of which (i.e one third of the bonus

outcome) will be an award of shares under the DABS plan.

For the year ended 31 March 2018, the Executive Directors’

performance-related annual bonus scheme comprised

four separately weighted elements based on achieving

clearly defined stretching profit before tax, revenue, cash

conversion and orderbook targets. For the other elements

to become payable, the profit before tax target must also

have been met.

Although the cash conversion and order book target were

met, the profit before tax target was not met. Accordingly,

there was no bonus paid to the Executive Directors nor was

there any award of options under the DABS Plan.

The Executive Directors’ performance-related annual

bonus scheme for the year to 31 March 2018 will comprise

elements based on achieving profit before tax, cash

conversion and revenue targets. There will be a smaller

element based on the achievement of specified personal

targets. Each element of the bonus will be independently

assessed on a sliding scale.

LONG-TERM INCENTIVESPSP

The Company has granted options over a total of 1.8m

ordinary shares under the PSP – of which 0.6m were

granted to the Executive Directors. Vesting of PSP awards

will be determined in equal measures by the achievement

of absolute EPS growth targets and relative TSR targets,

with TSR measured against a comparator group of support

services companies drawn from the FTSE SmallCap, FTSE

Fledgling and AIM indices. The targets are summarised as

follows:

Performance Level

Potential Vesting of each part of the award (50% subject to TSR; 50% subject to EPS) TSR attainment

EPS attainment (3 year growth)

Maximum 100% Upper Quartile or above

50% or more growth

Intermediate Between 25% and 100% on a straight-line basis

Median to Upper Quartile

Between 25% and 50% growth

Threshold 25% Median 25% growth


This plan requires participants to build and retain a

holding of vested awards or shares equal in value to the

participant’s maximum annual cash bonus potential.

RSP

The Company has granted options over 1.1m ordinary

shares under the RSP. This arrangement is focused on the

retention of selected key staff. The Executive Directors do

not participate in this plan. Awards will usually vest after

three years subject to continued employment.

Transformation Incentive Plan (TIP)

The TIP is now closed to new entrants. There are 60,000

options outstanding under the TIP all of which have vested

and are now exercisable.

Awards to the Executive Directors are set out in the table of

Directors’ interests below.

Chairman’s Share Award and Matching Share Award

Shortly after he resigned from the Board on 21 September

2017, Mike McTighe exercised all of the options awarded to

him in 2011 under:

• the Chairman’s Share Award (which mirrored the key terms of the TIP described above) and

• the Matching Share Award (whereby his investment of £100,000 in the Company’s capital restructuring could be matched on a 2.5 to 1),

that had vested in the intervening period.

In total this amounted to options over 1,075,162 ordinary

shares. There are no longer any options outstanding under

the Chairman’s Share Award or the Matching Share Award.

The current Chairman and the other Non-executive

Directors do not participate in the new incentive

arrangements.

EXECUTIVE DIRECTORS’ SERVICE AGREEMENTSAll service agreements for the Executive Directors are

terminable on 12 months’ notice by either party and contain

stringent restrictive covenants. None of the Executive

Directors’ service contracts contains provision for pre-

determined compensation for loss of office.

NON-EXECUTIVE DIRECTORS’ APPOINTMENTS AND REMUNERATIONThe Chairman and the Non-executive Directors do not

have contracts of employment but are appointed by letter

of appointment. Such appointments are initially for a three

year term and are terminable on three months’ notice

by either party at any time. There are no entitlements in

respect of loss of office. The remuneration of the Non-

executive Directors is determined by the Board within the

limits set out in the Articles of Association. Save in the

case of the one off awards to Mike McTighe above, Non-

executive Directors are not eligible for pensions, share

incentives or bonus payments.

The following table sets out the most recent election/

re-election dates for the Chairman and each of the Non-

executive Directors.

Name

Date of appointment as a Non-executive Director

Date of last election/ re-election at AGM

Expiry of current three year term

Jeremy Beeton 1 October 2015 22 September 2016

21 September 2019

David Jeffcoat 6 December 2009

22 September 2016

21 September 2019

Neil Masom 1 October 2015 22 September 2016

21 September 2019

Marcia Marini 1 January 2018 - 31 December 2021


2018 2017

Emoluments1 BonusBenefits

in kindPension or payment

in lieu Total Total

£‘000 £‘000 £’000 £’000 £’000 £’000

Executive Directors

Douglas McCormick2 269 - - 8 278 -

Iain Clarkson 241 - - 26 267 199

Paul Hamer3 123 34 1 20 178 403

Non-executive directors

Jeremy Beeton 66 - - - 66 40

David Jeffcoat 40 - - - 40 40

Marcia Marini4 10 10 -

Neil Masom 40 - - - 40 40

Mike McTighe5 52 - - - 52 125

1 Includes basic salary, car allowance in lieu of company car and fees to Non-executive Directors.

2 Payment in relation to the period Douglas McCormick held office during the year, having joined the Board on 12 June 2017.

3 Payment in relation to the period Paul Hamer held office during the year, having resigned from the Board on 9 June 2017 and his employment terminated on 31 July 2017.

4 Payment in relation to the period Marcia Marini held office during the year, having joined the Board on 1 January 2018.

5 Payment in relation to the period Mike McTighe held office during the year, having resigned from the Board on 21 September 2017.

DIRECTORS’ INTERESTSAs at 31 March 2018, the total beneficial, family and contingent interests of the Directors in the share capital of the Company

were as follows:

As at 31 March 2018 As at 31 March 2017

Beneficial Shares DABS PSP Beneficial Shares DABS PSP

Douglas McCormick

20,495 - 412,500 - - -

Iain Clarkson 20,000 - 365,000 - - 140,000

Jeremy Beeton 30,000 - - 15,000 - -

David Jeffcoat 155,710 - - 150,570 - -

Marcia Marini - - - - - -

Neil Masom 28,590 - - 28,590 - -

Having resigned from the Board on 9 June 2017, Paul Hamer retained his entitlement to 33,492 DABS. He exercised these

options on 22 September 2017.

Mr Hamer also retained his entitlement to a total of 377,255 options under the PSP (after pro-rating for the period from the

date of the relevant award to the date of his resignation). These options will be tested against the applicable EPS and TSR

criteria in 2018 and 2019. It is likely that the awards due to be tested in 2018 (238,587) will not meet any of the targets and

therefore will lapse.

Mr Hamer has no other outstanding awards under any of the Group’s share schemes.

Neil Masom

Chairman of the Remuneration Committee

5 June 2018


Statement of Directors’ Responsibilities

The Directors are responsible for preparing the Annual

Report, the Directors’ Remuneration Report and the

financial statements in accordance with applicable law

and regulations.

Company law requires the Directors to prepare financial

statements for each financial year. Under that law the

Directors have prepared the Group and Parent Company

financial statements in accordance with International

Financial Reporting Standards (IFRSs) as adopted by the

European Union. Under company law the Directors must

not approve the financial statements unless they are

satisfied that they give a true and fair view of the state of

affairs of the Group and the Company and of the profit or

loss of the Company for that period. In preparing these

financial statements, the Directors are required to:

• select suitable accounting policies and then apply them consistently

• make judgements and accounting estimates that are reasonable and prudent

• state whether applicable IFRSs as adopted by the European Union have been followed, subject to any material departures disclosed and explained in the financial statements, and

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

The Directors are responsible for keeping adequate

accounting records that are sufficient to show and explain

the Company’s transactions and disclose with reasonable

accuracy at any time the financial position of the Company

and the Group and enable them to ensure that the

financial statements comply with the Companies Act

2006. They are also responsible for safeguarding the

assets of the Company and the Group and hence for

taking reasonable steps for the prevention and detection

of fraud and other irregularities.

The Directors are responsible for the maintenance and

integrity of the corporate and financial information included

on the Company’s website. Legislation in the United

Kingdom governing the preparation and dissemination of

financial statements may differ from legislation in other

jurisdictions.

Each of the Directors, whose names and functions are listed

in the Directors’ Report, confirm that, to the best of their

knowledge:

• the financial statements, prepared in accordance with the relevant financial reporting framework, give a true and fair view of the assets, liabilities, financial position and profit of the Company and the undertakings included in the consolidation taken as a whole

• the Strategic Report includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties they face and

• the annual report and financial statements, taken as a whole, are fair, balanced and understandable and provide the information necessary for shareholders to assess the Company’s position and performance, business model and strategy.

This responsibility statement was approved by the Board of

Directors on 30 May 2018 and is signed on its behalf

By order of the Board

Benjamin Whitworth

Company Secretary

5 June 2018


One of the best of this year’s images in our internal Photography Competition, this common lizard was captured by Lucy Perrins whilst undertaking ecology surveys in Chelmsford, UK.

80


INDEPENDENT AUDITOR’S REPORT TO THE MEMBERS OF WYG plc

Report on the audit of the financial statements

OPINIONIn our opinion:

• the financial statements give a true and fair view of the state of the group’s and of the parent company’s affairs as at 31 March 2018 and of the group’s loss for the year then ended;

• the group financial statements have been properly prepared in accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union and IFRSs as issued by the International Accounting Standards Board (IASB);

• the parent company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and

• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006.

We have audited the financial statements of WYG plc

(the ‘parent company’) and its subsidiaries (the ‘group’)

which comprise:

• the consolidated income statement;

• the consolidated statement of comprehensive income;

• the consolidated and parent company balance sheets;

• the consolidated and parent company statements of changes in equity;

• the consolidated cash flow statement; and

• the related notes 1 to 28.

The financial reporting framework that has been applied in

their preparation is applicable law and IFRSs as adopted by

the European Union and, as regards the parent company

financial statements, as applied in accordance with the

provisions of the Companies Act 2006.

BASIS FOR OPINIONWe conducted our audit in accordance with International

Standards on Auditing (UK) (ISAs (UK)) and applicable law.

Our responsibilities under those standards are further

described in the auditor’s responsibilities for the audit of the

financial statements section of our report.

We are independent of the group and the parent company

in accordance with the ethical requirements that are

relevant to our audit of the financial statements in the

UK, including the FRC’s Ethical Standard as applied to

listed entities, and we have fulfilled our other ethical

responsibilities in accordance with these requirements.

We believe that the audit evidence we have obtained is

sufficient and appropriate to provide a basis for our opinion.

SUMMARY OF OUR APPROACH

Key audit matters

The key audit matters that we identified in the current year were:

• Revenue recognition - accounting for complex contracts;

• Recoverability and valuation of Work In Progress; and

• Claims provisioning

Materiality The materiality that we used for the group financial statements was £350,000 which was determined on the basis of a balanced portfolio of benchmarks used by stakeholders in the business.

ScopIng The audit scope is as follows;

• Full scope audit ,performed by the UK group team, for all UK and Dutch registered companies;

• Audit to a component materiality, performed by local overseas teams, for all companies registered in Turkey, Croatia and Poland; and

• Analytical review procedures to a component materiality for Romania, Bulgaria and Russia.


CONCLUSIONS RELATING TO GOING CONCERN

We are required by ISAs (UK) to report in respect of the following matters where:

• the directors’ use of the going concern basis of accounting in preparation of the financial statements is not appropriate; or

• the directors have not disclosed in the financial statements any identified material uncertainties that may cast significant doubt about the group’s or the parent company’s ability to continue to adopt the going concern basis of accounting for a period of at least twelve months from the date when the financial statements are authorised for issue.

We have nothing to

report in respect of

these matters.

.

KEY AUDIT MATTERSKey audit matters are those matters that, in our professional judgement, were of most significance in our audit of the

financial statements of the current period and include the most significant assessed risks of material misstatement

(whether or not due to fraud) that we identified. These matters included those which had the greatest effect on: the overall

audit strategy, the allocation of resources in the audit; and directing the efforts of the engagement team.

These matters were addressed in the context of our audit of the financial statements as a whole, and in forming our opinion

thereon, and we do not provide a separate opinion on these matters

REVENUE RECOGNITION – ACCOUNTING FOR COMPLEX CONTRACTS

Key audit matter description

Revenue recognised (excluding Joint Ventures share) on complex projects for the year is £152.9m (2017:£150.5m).

The results of the Group each year are heavily dependent upon management’s judgements in relation to the final outcome of the margin on projects worked on in the year. Profit should only be recognised on contracts if the final outcome can be assessed reliably. There is a risk of material misstatement that the revenue and profits recognised are not recoverable, or losses are not recognised appropriately. Additionally, costs and associated revenues could be incorrectly allocated across reporting periods.

Accounting for complex contracts is included as a principal risk in the Strategic report on page 29 and an area of significant judgement in the accounting policies in note 1. The revenue recognised by the group in the year is disclosed in note 3.

How the scope of our audit responded to the key audit matter

We have performed the following work around this key audit matter:

• where appropriate, tested the operating effectiveness of key controls in place around accounting for complex contracts and where operating effectiveness testing has not been performed, evaluated the design and implementation of key controls in place around accounting for complex contracts;

• assessed the design and implementation of key controls in place around forecast costs to complete;

• selected a sample of projects for review using a number of specific criteria including contract risk, absolute project value, stage of completion, amounts recoverable on projects held at the balance sheet date, and forecast margin. We have also selected a sample for testing from the remaining residual population;

• assessed whether our selection covers a sufficient amount of the Group balance sheet exposure (contract debtors and WIP) along with appropriate coverage of revenue and cost in the period and those contracts with a high percentage of work left to complete;

• performed audit procedures to determine the appropriateness of the judgements taken and challenged the commercial team around the range of possible outcomes in order to assess where their judgements reside along this continuum;

• considered the application of the Group’s accounting policies at each subsidiary to understand the level of consistency and approach to project risk;

• assessed and challenged the forecast costs to complete by assessing the reasonableness of forecasts prepared and reviewing managements past forecasting accuracy;

• reviewed any subsequent events (including post year end settlements, working capital recovery and valuation) which may impact project performance; and

• completed substantive testing of the underlying accounting for contracts, including vouching and review of revenues recognised to cash receipts and certifications, a sample of costs to assess whether they are a valid cost and have been allocated to contracts accurately and underlying documentation to support the level of variations recognised in revenue and profit.

Key observations We were satisfied that management’s judgements in respect of accounting for complex contracts are considered reasonable and revenue in relation to compex contracts is appropriately stated.


RECOVERABILITY AND VALUATION OF WORK IN PROGRESS “WIP”


At the end of 31 March 2018 the group had WIP of £23.6m (2017: £29.8m). The recoverability and valuation of WIP is considered to be a key audit matter, as part of the wider project accounting process. In such an environment, evidence of aged or slow moving WIP may suggest there is value recognised which cannot be recovered. Working capital days is one of the group’s KPIs and the group has a clear focus on the recovery of WIP.

Recoverability and valuation of work in progress is included as an area of significant judgement in the accounting policies in note 1 and the gross WIP balance and provision against this balance is included in note 15 to the accounts.



• tested the design, implementation and operating effectiveness of key controls related to the valuation and recoverability of WIP and debtors;

• agreed of a sample of WIP and receivables to post year-end certification and post year-end cash receipts respectively;

• where amounts are not yet cash settled (which is not unusual based on the contractual parties the group engages with), we have agreed a sample of Work In Progress and receivables to supporting evidence, including support for time and expenses claimed, and consideration of the payment profile of the project to date;

• discussed with commercial management on the reasoning behind any aged Work In Progress or receivables for which there is no provision, so as to ensure the provision held is adequate; and

• discussed with commercial management and agreed to supporting evidence where available, the reasoning behind any provision in place, so as to ensure the provision is not overstated

Key observations We were satisfied that management’s judgements in respect of recoverability and valuation of WIP are considered reasonable and WIP is appropriately stated.

CLAIMS PROVISIONING


At 31 March 2018 the group held a provision in respect of Professional Indemnity claims of £2.4m (2017: £1.2m). There is a risk of material misstatement that the provision recognised in respect of such claims is not appropriately valued and recognised, in accordance with IAS 37. The provisions in place are judgemental in terms of value, meaning that their valuation is an estimate, but there is also the risk of material misstatement that claims are not complete on the balance sheet due to newer claims in earlier stages which have not yet been raised to the group or that are difficult to determine the value of. As such, this key audit matter focuses on both the valuation of claims included and completeness of the balance.

Claims provisioning is included as a principal risk in the Strategic report on page 29 and an area of significant judgement in the accounting policies in note 1. A reconciliation in the provision balance from the prior to current year is included in note 18.



• reviewed the most recent ‘traffic light’ report from the PI Insurance broker and claims advisor for any incident coloured as red ‘high value, complex or active notifications’ and assessed whether an appropriate provision is in place;

• challenged the provision calculated by management, with reference to the claim status report received from PI Insurance broker and claims advisor and have held discussions with management, including the Legal Director and reviewed supporting third party documentation.

• performed substantive procedures on all claims with a provision value greater or year on year movement of more than £0.1m. This includes consideration of settlements and other adjustments to provisions recognised and a retrospective review of the judgements taken by management, in the prior year;

• discussed with management the completeness of the claims included in the provision; and

• reviewed board minutes for any discussion of claims not recognised within the provision, or by the PI Insurance broker and claims adviser.

Key observations We were satisfied that management’s judgements in respect of the valuation and completeness of the claims provision is appropriate and the claims provision is appropriately stated.


OUR APPLICATION OF MATERIALITYWe define materiality as the magnitude of misstatement in the financial statements that makes it probable that the

economic decisions of a reasonably knowledgeable person would be changed or influenced. We use materiality both in

planning the scope of our audit work and in evaluating the results of our work.

Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Group financial statements Parent company financial statements

Materiality £350,000 £280,000

Basis for determining materiality

The basis for determining materiality has taken into account key drivers of the business such as revenue, operating profit adjusted for separately disclosed items (“OPASD”), as per note 2 and net assets.

The determined materiality equates to 4.3% of OPASD 0.2% of revenue and 1.4% of net assets

The basis for determining materiality has taken into account the net assets of the company and also the group materiality set.

The determined materiality equates to 0.75% of the parent company’s net assets.

Rationale for the benchmark applied

This approach has been taken to consider a balanced portfolio of benchmarks used by stakeholders in the business

The parent company is a holding company, which does not trade. It has therefore been considered that a materiality determined on net assets is the most appropriate basis for an investment holding entity.

We agreed with the Audit Committee that we would report to the Committee all audit differences in excess of £17,500 for

the group, as well as differences below that threshold that, in our view, warranted reporting on qualitative grounds. We

also report to the Audit Committee on disclosure matters that we identified when assessing the overall presentation of the

financial statements.

OPASD £3.5m

Group materiality £350k

Component materiality range£176k to £280k

Audit Committee reporting threshold£17.5k


AN OVERVIEW OF THE SCOPE OF OUR AUDITThe scope of the group audit is as follows;

• Full scope audit by the group audit team for all UK and Dutch registered companies;

• Full scope audit by a component audit team for all companies registered in Turkey, Croatia and Poland;

• Analytical review procedures performed by the group audit team for Romania, Bulgaria and Russia; and

• Audit of the consolidation.

Due to the levels of revenue and profit contribution to

the group the Croatian, Turkish and Polish entities have

undergone a full scope audit, performed by a component

audit team.

Component audit teams have performed their work in line

with component materialities set by the group audit team.

These component materialities were capped at £280,000,

giving the range £175,000 to £280,000.

The audit partner has visited the components and attended

meetings with the component auditor in Poland, Turkey

and Croatia.

The scoping decisions made provide the following

coverage of revenue, operating profit adjusted for

separately disclosed items and net assets across the group.

Full scope audit performed by group teamFull scope audit performed by component teamReview at group level

REVENUE

81%

18%

1%

OPERATING PROFIT ADJUSTED FOR SEPERATELY DISCLOSED ITEMS

69%

27%

4%

NET ASSETS

80%

10%

10%


OTHER INFORMATION

The directors are responsible for the other information. The other information comprises

the information included in the annual report, other than the financial statements and our

auditor’s report thereon.

Our opinion on the financial statements does not cover the other information and, except

to the extent otherwise explicitly stated in our report, we do not express any form of

assurance conclusion thereon.

In connection with our audit of the financial statements, our responsibility is to read the

other information and, in doing so, consider whether the other information is materially

inconsistent with the financial statements or our knowledge obtained in the audit or

otherwise appears to be materially misstated.

If we identify such material inconsistencies or apparent material misstatements, we are

required to determine whether there is a material misstatement in the financial statements

or a material misstatement of the other information. If, based on the work we have

performed, we conclude that there is a material misstatement of this other information, we

are required to report that fact.

.We have nothing to


these matters..


RESPONSIBILITIES OF DIRECTORSAs explained more fully in the directors’ responsibilities statement, the directors are

responsible for the preparation of the financial statements and for being satisfied that

they give a true and fair view, and for such internal control as the directors determine is

necessary to enable the preparation of financial statements that are free from material

misstatement, whether due to fraud or error.

In preparing the financial statements, the directors are responsible for assessing the group’s

and the parent company’s ability to continue as a going concern, disclosing as applicable,

matters related to going concern and using the going concern basis of accounting unless

the directors either intend to liquidate the group or the parent company or to cease

operations, or have no realistic alternative but to do so.

AUDITOR’S RESPONSIBILITIES FOR THE AUDIT OF THE FINANCIAL STATEMENTSOur objectives are to obtain reasonable assurance about whether the financial statements

as a whole are free from material misstatement, whether due to fraud or error, and to

issue an auditor’s report that includes our opinion. Reasonable assurance is a high level of

assurance, but is not a guarantee that an audit conducted in accordance with ISAs (UK) will

always detect a material misstatement when it exists. Misstatements can arise from fraud or

error and are considered material if, individually or in the aggregate, they could reasonably

be expected to influence the economic decisions of users taken on the basis of these

financial statements.

A further description of our responsibilities for the audit of the financial statements is located

on the Financial Reporting Council’s website at: www.frc.org.uk/auditorsresponsibilities.

This description forms part of our auditor’s report.

USE OF OUR REPORTThis report is made solely to the company’s members, as a body, in accordance with

Chapter 3 of Part 16 of the Companies Act 2006. Our audit work has been undertaken so

that we might state to the company’s members those matters we are required to state to

them in an auditor’s report and for no other purpose. To the fullest extent permitted by

law, we do not accept or assume responsibility to anyone other than the company and the

company’s members as a body, for our audit work, for this report, or for the opinions we

have formed.

http://www.frc.org.uk/auditorsresponsibilities.


REPORT ON OTHER LEGAL AND REGULATORY REQUIREMENTS

OPINIONS ON OTHER MATTERS PRESCRIBED BY THE COMPANIES ACT 2006In our opinion, based on the work undertaken in the course of the audit:

• the information given in the strategic report and the directors’ report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the strategic report and the directors’ report have been prepared in accordance with applicable legal requirements.

In the light of the knowledge and understanding of the group and or the parent company and their environment obtained

in the course of the audit, we have not identified any material misstatements in the strategic report or the directors’ report.

MATTERS ON WHICH WE ARE REQUIRED TO REPORT BY EXCEPTION

Adequacy of explanations received and accounting records

Under the Companies Act 2006 we are required to report to you if, in our opinion:

• we have not received all the information and explanations we require for our audit; or

• adequate accounting records have not been kept by the parent company, or returns adequate for our audit have not been received from branches not visited by us; or

• the parent company financial statements are not in agreement with the accounting records and returns.

We have nothing to


these matters.

Directors’ remuneration

Under the Companies Act 2006 we are also required to report if in our opinion certain

disclosures of directors’ remuneration have not been made.

We have nothing to


these matters.

Simon Manning FCA (Senior statutory auditor)

For and on behalf of Deloitte LLP

Statutory Auditor

Leeds, UK

5 June 2018


Financial Statements

WYG plc Annual Report & Accounts 2018 89

Consolidated income statement 90

Consolidated statement of comprehensive

income 90

Balance sheets 91

Consolidated statement of changes in


Cash flow statements 94

Notes to the accounts 95


CONSOLIDATED INCOME STATEMENT

For the year ended 31 March 2018

Note

2018

£’000

2017

£’000

Continuing operations

Revenue including share of joint venture revenues 154,351 151,824

Less share of joint venture revenues (1,500) (1,284)

Revenue 3 152,851 150,540

Operating expenses 4 (157,700) (148,585)

Share of result of joint ventures 88 198

Operating (loss)/profit 2 (4,761) 2,153

Finance costs 6 (587) (554)

(Loss)/profit before tax (5,348) 1,599

Taxation 7 336 779

(Loss)/profit for the year (5,012) 2,378

(Loss)/profit attributable to the owners of the parent (5,012) 2,378

(Loss)/earnings per share 8

Basic (6.9p) 3.3p

Diluted (6.9p) 3.3p

Operating (loss)/profit for the year includes net costs of £8.3m (2017: £6.6m) that are separately disclosed in Note 2.

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME


2018

£’000

2017

£’000

(Loss)/profit for the year (5,012) 2,378

Other comprehensive income:

Currency translation difference* 390 1,110

Other comprehensive income for the year, net of tax 390 1,110

Total comprehensive (loss)/income for the year (4,622) 3,488

Total comprehensive (loss)/income attributable to:

Owners of the parent (4,622) 3,488

*These items might be reclassified subsequently to the income statement.


BALANCE SHEETS

As at 31 March 2018

Group Company

Note

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Non-current assets

Goodwill 10 18,193 18,193 - -

Other intangible assets 11 3,663 7,325 - -

Property, plant and equipment 12 4,277 3,180 - -

Investment in joint ventures 13 737 603 - -

Investments 13 - - 52,734 52,734

Deferred tax assets 14 1,173 1,246 - -

28,043 30,547 52,734 52,734

Current assets

Work in progress 15 23,722 29,986 - -

Trade and other receivables 16 27,697 30,323 - -

Current tax assets 213 370 - -

Cash and bank balances 4,750 6,518 360 353

56,382 67,197 360 353

Current liabilities

Trade and other payables 17 (40,512) (49,608) (15,983) (14,173)

Current tax liabilities (304) (235) - -

Borrowings 19 (6,000) (4,000) - -

(46,816) (53,843) (15,983) (14,173)

Net current assets/(liabilities) 9,566 13,354 (15,623) (13,820)

Non-current liabilities

Borrowings 19 (5,000) (5,000) - -

Retirement benefit obligations 27 (1,851) (2,115) - -

Deferred tax liabilities 14 (1,390) (2,035) - -

Provisions 18 (3,807) (3,177) - -

(12,048) (12,327) - -

Net assets 25,561 31,574 37,111 38,914

Equity attributable to the owners of the parent

Share capital 21 78 75 78 75

Translation reserve 1,885 1,495 13 13

Retained earnings 23,598 30,004 37,020 38,826

Total equity 25,561 31,574 37,111 38,914

The Directors have taken advantage of Section 408 of the Companies Act 2006 and have not prepared a separate income statement or statement of comprehensive income for the

Company. The consolidated loss attributable to equity shareholders includes a loss of £412,000 (2017: £435,000) attributable to the Company.

The accounts on pages 90 to 124 were approved by the Board of Directors on 5 June 2018 and signed on its behalf by:

D. MCCORMICK I. CLARKSON

WYG plc, Registered Number: 01869543


CONSOLIDATED STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY


Note

Share capital

£’000

Translation reserve

£’000

Retained earnings

£’000

Total

£’000

Non controlling

interest

£’000

Total equity

£’000

Balance as at 1 April 2016 73 385 27,791 28,249 32 28,281

Profit for the year - - 2,378 2,378 - 2,378


Currency translation differences - 1,110 - 1,110 - 1,110

Other comprehensive income for the year - 1,110 - 1,110 - 1,110

Total comprehensive income for the year - 1,110 2,378 3,488 - 3,488

Share based payments charge - - 906 906 - 906

Issue of share capital 21 2 - - 2 - 2

Dividends 9 - - (1,103) (1,103) - (1,103)

Reduction in minority shareholding - - 32 32 (32) -

Balance at 31 March 2017 75 1,495 30,004 31,574 - 31,574

Balance as at 1 April 2017 75 1,495 30,004 31,574 - 31,574

Loss for the year - - (5,012) (5,012) - (5,012)


Currency translation differences - 390 - 390 - 390

Other comprehensive income for the year - 390 - 390 - 390

Total comprehensive income/(loss) for the year - 390 (5,012) (4,622) - (4,622)

Share based payments credit - - (73) (73) - (73)

Issue of share capital 21 3 - - 3 - 3

Purchase of treasury shares - - (33) (33) - (33)

Dividends 9 - - (1,288) (1,288) - (1,288)

Balance at 31 March 2018 78 1,885 23,598 25,561 - 25,561


COMPANY STATEMENT OF CHANGES IN SHAREHOLDERS’ EQUITY


Company

Share capital

£’000

Translation reserve

£’000

Retained earnings

£’000

Total

£’000

Balance as at 1 April 2016 73 13 39,458 39,544

Loss for the year - - (435) (435)

Total comprehensive loss for the year - - (435) (435)

Share-based payments charge - - 906 906

Issue of share capital 2 - - 2

Dividends - - (1,103) (1,103)

Balance at 31 March 2017 75 13 38,826 38,914

Company

Balance as at 1 April 2017 75 13 38,826 38,914

Loss for the year - - (412) (412)

Total comprehensive loss for the year - - (412) (412)

Share-based payments credit - - (73) (73)

Issue of share capital 3 - - 3

Purchase of treasury shares - - (33) (33)

Dividends - - (1,288) (1,288)

Balance at 31 March 2018 78 13 37,020 37,111


CASH FLOW STATEMENTS


Group Company

Note

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Operating activities

Cash generated from/(used in) operations 22 1,158 3,380 7 (8)

Interest paid (475) (554) - -

Tax paid (361) (944) - -

Net cash generated from/(used in) operating activities 322 1,882 7 (8)

Investing activities

Purchases of property, plant and equipment (2,509) (1,654) - -

Purchases of intangible assets (computer software) (173) (260) - -

Settlement of deferred consideration (230) (2,276) - -

Net cash used in investing activities (2,912) (4,190) - -

Financing activities

Proceeds on issue of shares 3 - - -

Purchase of treasury shares (33) - - -

Dividends 9 (1,270) (684) - -

Drawdown of borrowings 2,000 1,000 - -

Net cash generated from financing activities 700 316 - -

Net (decrease)/increase in cash and cash equivalents (1,890) (1,992) 7 (8)

Cash and cash equivalents at beginning of year 6,518 8,231 353 361

Effects of foreign exchange rates on cash and cash equivalents 122 279 - -

Cash and cash equivalents at end of year 23 4,750 6,518 360 353


NOTES TO THE ACCOUNTS1. SIGNIFICANT ACCOUNTING POLICIES

General information

WYG plc (the Company) is a public Compat limited by shares incorporated in the United Kingdom under the Companies Act and is registered in England and Wales. The address of the Company’s registered office is shown on page 131.

The principal activities of the Company and its subsidiaries (the Group) and the nature of the Group’s operations are set out in the strategic report on pages 18 to 55.

These financial statements are presented in pounds sterling because that is the currency of the primary economic environment in which the group operates. Foreign operations are included in accordance with the policies set out below.

Basis of accounting

The accounts have been prepared on a going concern basis in accordance with International Financial Reporting Standards (IFRS), International Financial Reporting Interpretations Committee (IFRIC) interpretations endorsed by the European Union (EU) and those parts of the Companies Act 2006 applicable to companies reporting under IFRS (see pages 68 to 70 in the Directors’ Report). The accounts have been prepared under the historical cost convention. These policies have been consistently applied to all the years presented.

The preparation of accounts in conformity with IFRS generally requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the accounts and the reported amounts of revenues and expenses during the reporting period. Although these estimates are based on management’s best knowledge of the amount, event or actions, actual results ultimately may differ from those estimates.

Standards, amendments to published standards and interpretations effective for the year ended 31 March 2018

Other than noted below, there are no IFRS or IFRIC interpretations that are effective for the first time for the year ended 31 March 2018 that have had a material impact on the Group.

Standards, amendments to published standards and interpretations issued but not effective for the year ended 31 March 2018 and not early adopted

At the date of authorisation of these financial statements, the Group has not applied the following new and revised IFRSs that have been issued but are not yet effective:

IFRS9 – Financial instruments. This will be adopted in the financial statements for the year ended 31 March 2019. There is no material impact to the Group.

IFRS15 – Revenue from contracts with customers. This will be adopted in the financial statements for the year ended 31 March 2019. There is no material impact on revenues and earnings from the adoption of this standard. Net assets will reduce by circa £0.9m at 31 March 2018 as pre-contract costs will no longer be capitalised.

IFRS16 – Leases

IFRS2 (amendments) – Classification and measurement of share-based payment transactions

IAS7 (amendments) – Disclosure initiative

IAS12 (amendments) – Recognition of deferred tax assets for unrealised losses

IFRS10 and IAS28 – Sale or contribution of assets between an investor and its associate

The Directors do not expect that the adoption of the Standards listed above will have a material impact on these financial statements of the Group in future periods, except as noted below:

IFRS16 – Leases will have a material impact on the reported assets, liabilities, income statement and cash. It is not practical to provide a reasonable estimate of the effect of this standard until a detailed review has been completed.

Basis of consolidation

The consolidated accounts incorporate the accounts of the Company and entities controlled by the Company (its subsidiaries) made up to 31 March each year. Control is achieved when the Company:

• has the power over the investee;

• is exposed, or has rights, to variable return from its involvement with the investee; and

• has the ability to use its power to affects its returns.

The Company reassesses whether or not it controls an investee if facts and circumstances indicate that there are changes to one or more of the three elements of control listed above.


1. SIGNIFICANT ACCOUNTING POLICIES CONTINUEDWhen the Company has less than a majority of the voting rights of an investee, it considers that it has power over the investee when the voting rights are sufficient to give it the practical ability to direct the relevant activities of the investee unilaterally. The Company considers all relevant facts and circumstances in assessing whether or not the Company’s voting rights in an investee are sufficient to give it power, including:

• the size of the Company’s holding of voting rights relative to the size and dispersion of holdings of the other vote holders;

• potential voting rights held by the Company, other vote holders or other parties;

• rights arising from other contractual arrangements; and

• any additional facts and circumstances that indicate that the Company has, or does not have, the current ability to direct the relevant activities at the time that decisions need to be made, including voting patterns at previous shareholders’ meetings.

Consolidation of a subsidiary begins when the Company obtains control over the subsidiary and ceases when the Company losses control of the subsidiary. Specifically, the results of subsidiaries acquired or disposed of during the year are included in the consolidated income statement from the date the Company gains control until the date when the Company ceases to control the subsidiary.

Profit or loss and each component of other comprehensive income are attributed to the owners of the Company and to the non-controlling interests. Total comprehensive income of the subsidiaries is attributed to the owners of the Company and to the non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Where necessary, adjustments are made to the accounts of subsidiaries to bring the accounting policies used into line with the Group’s accounting policies.

All intragroup assets and liabilities, equity, income, expenses and cash flows relating to transactions between the members of the Group are eliminated on consolidation.

Non-controlling interests in subsidiaries are identified separately from the Group’s equity therein. Those interests of non-controlling shareholders that are present ownership interests entitling their holders to a proportionate share of net assets upon liquidation may initially be measured at fair value or at the non-controlling interests’ proportionate share of the fair value of the acquiree’s identifiable net assets. The choice of measurement is made on an acquisition-by-acquisition basis. Other non-controlling interests are initially measured at fair value. Subsequent to acquisition, the carrying amount of non-controlling interests is the amount of those interests at initial recognition plus the non-controlling interests’ share of subsequent changes in equity. Total comprehensive income is attributed to non-controlling interests even if this results in the non-controlling interests having a deficit balance.

Changes in the Group’s interests in subsidiaries that do not result in a loss of control are accounted for as equity transactions. The carrying amount of the Group’s interests and the non-controlling interests are adjusted to reflect the changes in their relative interests in the subsidiaries. Any difference between the amount by which the non-controlling interests are adjusted and the fair value of the consideration paid or received is recognised directly in equity and attributed to the owners of the Company.

Revenue recognition

Gross revenue represents the value of work earned during the year on contracts by reference to total contract value and stage of completion, including third party payments. Stage of completion is normally measured by the proportion that contract costs incurred for work performed to date bear to the estimated total contract costs, except where this would not be representative of the stage of completion.

Profit is recognised on a percentage completion basis when the outcome of a contract or project can be reasonably foreseen. Provision is made in full for estimated losses. Where the outcome of a contract cannot reasonably be foreseen, profit is taken on completion. When it is probable that total contract costs will exceed total contract revenue, the expected loss is recognised as an expense immediately.

The Group employs the use of third party contractors on its projects but this is not considered a primary source of revenue. In accordance with IAS 11 these costs have been accounted as part of the cost of the projects. The Group has primary responsibility for the work carried out, including work done by subcontractors whose services would have no separate value without the existence of the project controlled by the Group. Since the Group is acting as principal it recognises revenue based on the gross amount received or receivable in respect of its performance under the sales contract with the end customer.

Third party payments represent costs incurred by the Group on behalf of clients which are invoiced at no margin. Progress payments receivable in excess of the value of work executed on individual contracts are included in trade and other payables.

Unbilled revenue

As described above revenue represents the value of work earned during the year by reference to the total contract value and stage of completion. Unbilled revenue is the difference between the revenue recognised and the amounts actually invoiced to customers. Where revenue exceeds the amount of invoicing, the excess is included within work-in-progress. Where invoicing exceeds the amount of revenue recognised these amounts are disclosed as payments received on account, in trade and other payables.

Separately disclosed items

Items that are material and whose significance is sufficient to warrant separate disclosure and identification within the consolidated accounts are included within separately disclosed items (see note 2).

Other intangible assets

Intangible assets purchased separately, such as software licences that do not form an integral part of related hardware, are capitalised at cost and amortised on a straight-line basis over their useful economic life. Intangible assets acquired through a business combination are initially measured at fair value and amortised on a straight-line basis over their useful economic lives. Fair value of the acquired intangible assets is calculated based on the estimated future benefits the Group will derive from the asset acquired, discounted at an appropriate Weighted Average Cost of Capital (WACC). The useful economic lives used are as follows:

Computer software – 3 to 5 years

Order books – 1 to 4 years

Customer relationships – 5 to 10 years


1. SIGNIFICANT ACCOUNTING POLICIES CONTINUEDGoodwill

Goodwill arising on consolidation represents the excess of the cost of acquisition over the Group’s interest in the fair value of the identifiable assets and liabilities of a subsidiary, associate or jointly controlled entity at the date of acquisition. Goodwill is recognised as an asset and tested for impairment at least annually by reference to the relevant cash-generating unit (CGU) and is carried at cost less accumulated impairment losses. Any impairment is recognised immediately in the income statement and is not subsequently reversed (see note 10).

Impairment of assets

Assets that are subject to depreciation and amortisation are tested for impairment whenever events or changes in circumstance indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs to sell and value in use. For the purposes of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash flows discounted at an appropriate rate.

Property, plant and equipment

Property, plant and equipment is stated at cost less accumulated depreciation and any recognised impairment loss. The cost of an item of property, plant and equipment comprises its purchase price and any costs directly attributable to bring the asset into use.

Depreciation is charged so as to write off the cost of assets as follows:

Short leasehold improvements – equally over the life of the lease

Motor vehicles – 30% per annum on net book value

Office furniture and equipment – 20% to 33.3% per annum on original cost

Assets held under finance leases are depreciated over their expected useful lives on the same basis as owned assets or, where shorter, over the term of the relevant lease.

Leases

Assets held under finance leases, hire purchase contracts and other similar arrangements, which confer rights and obligations similar to those attached to owned assets, are capitalised as tangible fixed assets at the fair value of the leased asset (or, if lower, the present value of the minimum lease payments as determined at the inception of the lease) and are depreciated over the shorter of the lease terms and their useful lives. The capital elements of future lease obligations are recorded as liabilities, while the interest elements are charged to the profit and loss account over the period of the leases to produce a constant periodic rate of interest on the remaining balance of the liability.

Rentals under operating leases are charged on a straight-line basis over the lease term, even if the payments are not made on such a basis. Benefits received and receivable as an incentive to sign an operating lease are similarly spread on a straight-line basis over the lease term.

The Group has a number of vacant leasehold properties. Provision has been made for the residual lease commitments together with other outgoings, after taking into account assumptions relating to later periods of sub-lease.

Work in progress

Work in progress is stated at cost plus attributable profits less foreseeable losses and progress payments received and receivable. Cost comprises direct staff costs and attributable overheads. Attributable profit is that proportion of the total profit currently estimated to arise over the duration of a contract, as earned at the balance sheet date. Work-in-progress is recognised when projects are assessed for contract progress and the proportion of contract work completed at the balance sheet date is determined in relation to the total contract works. Appropriate provisions are made for slow moving and irrecoverable work-in-progress.

Cash and cash equivalents

Cash and cash equivalents comprise cash at bank and other short term highly liquid investments with a maturity of three months or less.

Tax

The tax expense represents the sum of the tax currently payable and deferred tax along with any adjustments to prior year estimates.

The tax currently payable is based on taxable profit for the year. Taxable profit differs from net profit as reported in the income statement because it excludes items of income or expense that are taxable or deductible in other years and it further excludes items that are never taxable or deductible. The Group’s liability for current tax is calculated using tax rates that have been enacted or substantively enacted by the balance sheet date.

Deferred tax is the tax expected to be payable or recoverable on differences between the carrying amounts of assets and liabilities in the accounts and the corresponding tax bases used in the computation of taxable profit, and is accounted for using the liability method. Deferred tax liabilities are generally recognised for all taxable temporary differences and deferred tax assets are recognised to the extent that it is probable that taxable profits will be available against which deductible temporary differences can be utilised. Such assets and liabilities are not recognised if the temporary difference arises from goodwill or from the initial recognition (other than in a business combination) of other assets and liabilities in a transaction that affects neither the tax profit nor the accounting profit.

The carrying amount of deferred tax assets is reviewed at each balance sheet date and reduced to the extent that it is no longer probable that sufficient taxable profits will be available to allow all or part of the asset to be recovered.

Deferred tax is calculated at the tax rates that are expected to apply in the period when the liability is settled or the asset is realised. Deferred tax is charged or credited in the income statement, except when it relates to items charged or credited directly to equity, in which case the deferred tax is also dealt with in equity.


1. SIGNIFICANT ACCOUNTING POLICIES CONTINUEDForeign currency translation

Items included in the accounts of each of the Group’s entities are measured using the currency of the primary economic environment in which the entity operates (the “functional currency”). The consolidated accounts are presented in Sterling, which is the Company’s functional and presentation currency for the consolidated accounts.

Transactions in currencies other than the functional currency are recorded at the rates of exchange prevailing on the dates of the transactions. At each balance sheet date, monetary assets and liabilities that are denominated in foreign currencies are retranslated at the rates prevailing on the balance sheet date. Gains and losses arising on retranslation are included in the income statement for the period, except for exchange differences arising on non-monetary assets and liabilities where the changes in fair value are recognised directly in equity.

On consolidation, the assets and liabilities of the Group’s overseas operations are translated at exchange rates prevailing on the balance sheet date. Income and expense items are translated at the average exchange rates for the period unless exchange rates fluctuate significantly. Exchange differences arising, if any, are classified as equity and transferred to the Group’s translation reserve.

Goodwill and fair value adjustments arising on the acquisition of a foreign entity are treated as assets and liabilities of the foreign entity and translated at the closing rate.

Investments in subsidiary undertakings

Investments in subsidiary undertakings are stated in the Company’s Balance Sheet at cost less any provision for impairment in value.

Joint arrangements

Where the Group is party to an arrangement over which it has joint control, the joint arrangement is classified as either:

• Joint operation: where the parties that have joint control over the arrangement have rights to the assets and obligations for the liabilities relating to the arrangement;

• The Group recognises its share of assets, liabilities, revenues and expenses relating to its involvement in Joint operations;

• Joint Venture: where the parties that have joint control of the arrangement have rights to the net assets of the arrangement;

The Group recognises its involvement in a Joint Venture as an investment using the equity method.

Employee benefits

Retirement benefit costs

Payments to defined contribution retirement benefit schemes are charged as an expense as they fall due.

Short term compensated absences

A liability for short term compensated absences, such as holiday, is recognised in trade and other payables for the amount the Group may be required to pay as a result of the unused entitlement that has accumulated at the balance sheet date.

Segmental reporting

Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, and who has been identified by the Board of Directors. The Group’s operations are now managed and reported by key technical segments, Consultancy Services and International Development. The prior period results have been restated to reflect this new reporting structure.

Share-based payments

The Group issues equity-settled payments to certain employees. Equity-settled share-based payments are measured at fair value at the date of grant. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight line basis over the vesting period, based on the Group’s estimate of shares that will eventually vest.

The fair value of share options is measured by use of the Monte-Carlo pricing model. The expected life used in the model has been adjusted, based on management’s best estimate, for the effects of non-transferability, exercise restrictions and behavioural considerations.

Financial instruments

Financial assets and financial liabilities are recognised on the Group’s Balance Sheet when the Group becomes a party to the contractual provisions of the instrument.

Trade receivables

Trade receivables do not carry any interest and are stated at their amortised cost as reduced by appropriate allowances for estimated irrecoverable amounts. A provision for impairment is established where there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of the receivables. The amount of the provision is recognised in the income statement.

Bank borrowings

Interest-bearing bank loans and overdrafts are recorded at the proceeds received, net of direct issue costs. Finance charges, including premiums payable on settlement or redemption and direct issue costs, are accounted for on an accrual basis in the income statement and are added to the carrying amount of the instrument to the extent that they are not settled in the period in which they arise.

Trade payables

Trade payables are not interest-bearing and are stated at their amortised cost.

Equity instruments

Equity instruments issued by the Company are recorded at the proceeds received, net of direct issue costs.


1. SIGNIFICANT ACCOUNTING POLICIES CONTINUEDCapital risk management

The Group’s objectives when managing capital are to safeguard the Group’s ability to continue as a going concern in order to provide returns for shareholders and benefits for other stakeholders and to maintain an optimal capital structure to reduce the cost of capital. In order to maintain or adjust the capital structure, the Group may adjust the amount of dividends paid to shareholders, return capital to shareholders, issue new shares or sell assets to reduce debt.

The key element of capital managed by the Group is its liquid cash resources and these are monitored on a daily basis.

The Group is subject to a number of restrictions from its lenders as to the amounts of cash that are held in certain jurisdictions and outside the security of the lender group.

Dividend distribution

Dividend distribution to the Company’s shareholders is recognised as a liability in the Group’s accounts in the period in which the dividends are approved by the Company’s shareholders.

Project claims

Project claims can be made as a consequence of disputes or shortcomings in project delivery and could impact upon the results of the Group. It is embedded in the Group’s culture that client relationships are developed so as to ensure client satisfaction. However, it is recognised that project claims are possible, and that these risks cannot completely be eliminated. In the event that such claims arise, in common with others operating in the sector, the Group has established professional indemnity insurance policies that are intended to protect against significant losses.

Significant judgements and key sources of estimation uncertainty

The preparation of the financial statements requires the Group to make estimates, judgements and assumptions that affect the reported amounts of assets, liabilities, revenues and expenses and related disclosure of contingent assets and liabilities. The Directors base their estimates on historical experience and various other assumptions that they believe are reasonable under the circumstances, the results of which form the basis for making judgements about the carrying value of the assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates under different assumptions or conditions.

Areas of judgement that have a critical effect on the amounts recognised in the accounts are:

Key judgements:

• Revenue recognition and the assessment of the percentage of contract completion achieved. The Group assesses contract progress and determines the proportion of contract work completed at the balance sheet date in relation to the total contract works.

• Review of asset carrying values and impairment charges. The Group performs impairment testing in accordance with the accounting policy described within the significant accounting policies in the notes to the accounts. The calculation of recoverable amounts requires the use of estimates and assumptions consistent with the most recent budgets and plans that have been formally approved by management.

• Professional indemnity claims. Provision is made on an assessment of claims and necessarily includes estimates as to the likely costs. All active claims are reviewed regularly. To the extent that actual claims and settlements differ from those projected, the provisions could vary significantly (see note 18).

• Work in progress and receivables valuation. The Group assess work in progress and trade receivables for exposure to losses. Provision is made in full for estimated losses (see note 15).

In addition, there are other areas of estimated uncertainty in the accounts in relation to key sources of estimation and uncertainty:

• The valuation of share options. Uncertainty arises due to the assumptions over future share price, performance of the Group and leavers. Further details on share options can be found in note 26.

• Deferred tax balances. Uncertainty arise due to the assumptions of future tax rates and the future performance of the Group. Further details on deferred tax can be found in note 14.

• Vacant leasehold properties. The Group has a number of vacant leasehold properties, the majority of which are held under head leases expiring within the next five years. Provision has been made for the residual lease commitments together with other outgoings, after taking into account assumptions relating to later periods of sub-lease (see note 18).


2. DETAILED CONSOLIDATED INCOME STATEMENT Revenue

including share of joint ventures

£’000

Operating (loss)/profit

£’000

(Loss)/profit before tax

£’000

Year ended 31 March 2018

Before separately disclosed items 154,351 3,506 2,919

Separately disclosed items - (8,267) (8,267)

Total 154,351 (4,761) (5,348)

Year ended 31 March 2017

Before separately disclosed items 151,824 8,768 8,214

Separately disclosed items - (6,615) (6,615)

Total 151,824 2,153 1,599

Details of separately disclosed items

2018

£’000

2017

£’000

Share option credit/(costs) 251 (742)

Amortisation of acquired intangible assets (1,160) (1,863)

Impairment of intangible assets (2,406) -

Other charges (4,952) (4,010)

Separately disclosed items (8,267) (6,615)

The Group has incurred a number of material items in the year, whose significance is sufficient to warrant separate disclosure. The key elements included within separately disclosed items are:

• Annual credit/(charge) in relation to share option costs. The credit in the current year reflects the reduction in associated employee tax liabilities following the fall in the Group’s share price

• Annual charge for the amortisation of acquired intangibles

• Impairment of acquired intangibles following the closure of North Associates

• Items included in other charges in the year are legacy claims relating to non-continuing businesses, closure costs of North Associates, bank refinancing fees and costs incurred for the strategic growth plan net of credits in relation to deferred acquisition balances

• The other charges in the prior year relate to costs incurred for the strategic growth plan and the closure of certain Polish operations.

The Directors believe that the operating profit before separately disclosed items gives a better view of underlying trading for the Group and enables the user of the accounts to more accurately understand the Group’s performance. Although the share option costs and amortisation of intangible assets are charges which occur annually, the Directors excluded those charges from operating profit before separately disclosed items because their value is significant and they are not related to the underlying performance of the business. The other charges in the year are expected to be one off in nature. Consequently, the Directors believe it is appropriate to exclude them from operating profit before separately disclosed items.


3. SEGMENTAL INFORMATIONBusiness segments

IFRS 8 requires segment reporting to be based on the internal financial information reported to the chief operating decision maker. The Group’s chief operating decision maker is deemed to be the executive management team comprising the Chief Executive Officer and the Chief Financial Officer. Its primary responsibility is to manage the Group’s day-to-day operations and analyse trading performance.

Following the launch of the Group’s new long-term growth strategy, the business has been reorganised to focus on the strengths of our consultancy services and international development business. The Group’s segments are detailed below and are those segments reported in the Group’s management accounts used by the executive management team as the primary means for analysing trading performance. The Executive management team assesses profit performance using operating profit measured on a basis consistent with the disclosure in the Group accounts.

The Group’s operations are now managed and reported by key technical segments as follows:

• Consultancy Services (includes UK and CEE; 91% of revenues relate to the UK)

• International Development

The prior period results have been restated to reflect this new reporting structure.

The segment results for the year ended 31 March 2018 are as follows:


2018

£’000


2018

£’000

Group

2018

£’000

Revenues including share of joint venture revenues 119,264 35,087 154,351

Less share of joint venture revenues (1,500) - (1,500)

117,764 35,087 152,851

Result

Operating profit before central overheads and separately disclosed items 5,441 2,015 7,456

Central overheads (3,950)

Operating profit before separately disclosed items 3,506

Separately disclosed items (Note 2) (8,267)

Operating loss (4,761)

Finance costs (587)

Loss before tax (5,348)

Tax 336

Loss for the period (5,012)

Loss attributable to the owners of the parent (5,012)

Other information:

Additions to property, plant and equipment and intangible assets 1,984 698 2,682

Depreciation, amortisation and impairment charges 4,841 321 5,162


3. SEGMENTAL INFORMATION CONTINUEDConsultancy

Services

2018

£’000


2018

£’000

Group

2018

£’000

Balance sheet

Assets

Segment assets 60,960 17,329 78,289

Unallocated corporate assets 6,136

Group total assets 84,425

Liabilities

Segment liabilities (34,241) (10,078) (44,319)

Unallocated corporate liabilities (14,545)

Group total liabilities (58,864)

Unallocated corporate assets represent cash and cash equivalents, tax recoverable, retirement benefit assets and deferred tax assets. Unallocated corporate liabilities represent financial liabilities, retirement benefit obligations, corporation tax and deferred tax liabilities.


3. SEGMENTAL INFORMATION CONTINUEDRestated


2017

£’000

Restated International

Development

2017

£’000

Group

2017

£’000

Revenue

External revenue 115,766 36,058 151,824

Less share of joint venture revenues (1,284) - (1,284)

114,482 36,058 150,540

Operating profit before central overheads and separately disclosed items 8,383 4,677 13,060

Central overheads (4,292)

Operating profit before separately disclosed items 8,768

Separately disclosed items (note 2) (6,615)

Operating profit 2,153

Finance costs (554)

Profit before tax 1,599

Tax 779

Profit for the year 2,378

Profit attributable to the owners of the parent 2,378

Other information

Additions to property, plant and equipment and intangible assets 1,711 203 1,914

Depreciation and amortisation 3,457 448 3,905


3. SEGMENTAL INFORMATION CONTINUEDRestated


2017

£’000

Restated International

Development

2017

£’000

Group

2017

£’000

Balance sheet

Assets

Segment assets 68,466 21,144 89,610

Unallocated corporate assets 8,134

Group total assets 97,744

Liabilities

Segment liabilities (40,139) (12,646) (52,785)

Unallocated corporate liabilities (13,385)

Group total liabilities (66,170)

Unallocated corporate assets represent cash and cash equivalents, tax recoverable and deferred tax assets. Unallocated corporate liabilities represent financial liabilities, retirement benefit obligations, corporation tax and deferred tax liabilities.


4. OPERATING EXPENSES 2018

£’000

2017

£’000

Staff costs (Note 5) 70,689 66,662

Other external and operating charges 81,849 78,018

Depreciation 1,331 1,670

Amortisation of intangible assets 3,831 2,235

157,700 148,585

Operating profit has been arrived at after charging:

2018

£’000

2017

£’000

Depreciation of property, plant and equipment 1,331 1,670

Amortisation and impairment of intangible assets 3,831 2,235

Loss on disposal of property, plant, equipment and intangibles 100 4

Operating lease rentals – plant and machinery 734 774

Operating lease rentals – other 3,493 3,669

During the year, the Group (including its overseas subsidiaries) obtained the following services from the Company’s auditor and its associates:

2018

£’000

2017

£’000

Fees payable to the Company’s auditor for the audit of the parent company and consolidated accounts 24 20

Fees payable to the Company’s auditor and its associates for other services:

The audit of the Company’s subsidiaries 205 172

Total audit fees 229 192

Tax advisory services - 18

Other assurance services 28 -

Total non-audit fees 28 18


5. STAFF COSTSThe average monthly number of employees was:

Group

2018

Number

2017

Number

Technical 1,259 1,252

Administrative 301 321

1,560 1,573

The actual number of employees at 31 March was:

Group

2018

Number

2017

Number

Technical 1,329 1,251

Administrative 312 317

1,641 1,568

Their aggregate remuneration comprised:

Group

2018

£’000

2017

£’000

Wages and salaries 58,977 54,451

Social security costs 8,096 7,747

Pension costs 3,867 3,722

Share option (credit)/costs (note 2) (251) 742

70,689 66,662

In addition to the above permanent staff, the Group utilises the services of agency and temporary contract staff as circumstances require. Staff costs for the Company are £245,000 (2017: £274,000) reflecting amounts paid to Directors. The Company has no employees.

Details of Directors’ remuneration are given in the Directors’ Remuneration Report. Only the information included within the Directors’ remuneration table on page 78 consisting of the emoluments, pension and benefits in kind has been audited and forms part of these financial statements.

The Directors have identified 9 (2017: 8) key management personnel, this comprises the two executive Directors and senior operational management of the wider Group whose cost to the Group was as follows:

Group

2018

£’000

2017

£’000

Wages and salaries 1,634 1,250

Social security costs 199 173

Pension costs 226 191

2,059 1,614


6. FINANCE COSTS2018

£’000

2017

£’000

Interest on bank loans, bonds, guarantees and overdrafts 587 554

7. TAXATION2018

£’000

2017

£’000

Corporation tax:

Current year charge – UK - 250

Current year charge/(credit) – foreign 241 (282)

Adjustments in respect of prior years - UK (5) (452)

Adjustments in respect of prior years - foreign - 203

Total current tax charge/(credit) 236 (281)

Deferred tax:

Origination and reversal of temporary differences (611) (504)

Effect of change in tax rate - 14

Exchange differences 39 (8)

Total tax credit (336) (779)

Corporation tax is calculated at 19% (2017: 20%) of the estimated taxable profit for the year. In the prior year, the tax charge borne on the repayment of the pension surplus received from the winding up of the WYD Pension scheme was calculated at 35%.

Tax for other jurisdictions is calculated at the rates prevailing in the respective jurisdictions. Reductions to the corporation tax rate to 19% with effect from 1 April 2017 and to 17% with effect from 1 April 2020 have been introduced by the Finance No2 Act 2015 and the Finance Act 2016. Accordingly UK deferred tax has been provided and recognised at the rates applicable to the years in which temporary differences are expected to reverse. Furthermore legislation to provide for a separate Northern Ireland corporation tax rate was enacted in the Corporation Tax (Northern Ireland) Act 2015. It was intended that the rate would be 12.5% from April 2018. The Northern Ireland rate is not substantively enacted as there is currently no functioning devolved assembly in Stormont and the relevant commencement regulations have not been passed by the UK Government. Management estimates that when the 12.5% rate is substantively enacted the effect will be to reduce the recognised deferred tax asset on tax deductible goodwill by £94k.


7. TAXATION CONTINUEDFactors affecting the current tax credit for the year

The tax credit for the year is lower (2017: lower) than the standard rate of corporation tax in the UK when applied to reported profit. The differences are explained below:

2018

£’000

2017

£’000

(Loss)/profit before tax (5,348) 1,599

(Loss)/profit before tax multiplied by the standard rate of UK corporation tax rate

of 19% (2017: 20%) (1,016) 320

Tax effect of expenses that are not deductible in determining taxable loss/profit 591 784

Tax effect of utilisation of tax losses not previously recognised (858) (653)

Deferred tax assets not previously recognised (187) (943)

Tax effect of income not taxable in determining taxable profit (138) -

Tax effect of adjustments for share based payments (389) -

Change in unrecognised deferred tax assets 1,619 -

Effect of rate change on intangibles 32 14

Adjustment in respect of prior years 5 (257)

Foreign taxes (4) -

Effect of different tax rates of subsidiaries operating in other jurisdictions 3 18

Exchange differences 39 (8)

Other (33) (54)

Total tax credit (336) (779)

The company’s loss for this accounting year is taxed at an effective rate of 19% (2017: 20%).

The future effective tax rate will be affected by future reduction in UK corporation tax rates, the mix of profits between UK and overseas territories with different tax rates, the utilisation of losses for which no deferred tax asset has been recognised and the incurring of losses for which no deferred tax asset is considered supportable. Deferred tax assets are recognised by an annual judgement that depends on the performance in different countries. This will impact the ultimate effective tax rate.


8. (LOSS)/EARNINGS PER SHAREThe calculation of basic and diluted earnings per share is based on the following data:

2018

£’000

2017

£’000

(Loss)/earnings for the purposes of basic and diluted earnings per share being profit for the year attributable to the owners (5,012) 2,378

Adjustment relating to separately disclosed items (see note 2) 8,267 6,615

Tax impact of separately disclosed items (10) (354)

Earnings for the purposes of basic and diluted adjusted earnings per share 3,245 8,639

2018

Number

2017

Number

Number of shares

Weighted average number of shares for basic earnings per share 72,729,665 71,131,521

Effect of dilutive potential ordinary shares:

Share options 1,049,173 1,560,338

Weighted average number of shares for diluted earnings per share 73,778,838 72,691,859

(Loss)/earnings per share

Basic (6.9p) 3.3p

Diluted (6.9p) 3.3p

Adjusted earnings per share

Basic 4.5p 12.1p

Diluted 4.4p 11.9p

The adjusted earnings per share is calculated after excluding separately disclosed items. In the opinion of the Directors, this more accurately reflects the underlying performance of the Group.

9. DIVIDENDSThe final dividend of 1.2p per share for the year ended 31 March 2017 (2016: 1.0p per share) was paid in September 2017. The interim dividend of 0.6p per share for the year ended 31 March 2018 (2017: 0.6p) was approved on 1 December 2017 and paid in April 2018 and was accrued in the financial statements at 31 March 2018. The amount recognised during the year was £1,288,000 (2017: £1,103,000).

The Directors have proposed a final dividend of 1.2p per share for the year ended 31 March 2018 (2017: 1.2p). This has not yet been approved by shareholders and so is not included as a liability in the financial statements.


10. GOODWILL

£’000

Cost

At 1 April 2016, 31 March 2017, 31 March 2018 69,931

Accumulated impairment losses at 1 April 2016, 31 March 2017, 31 March 2018 (51,738)

Net book value

At 1 April 2016, 31 March 2017, 31 March 2018 18,193

Goodwill is tested for impairment annually and whenever there are indications that it may have suffered an impairment. Goodwill is considered impaired to the extent that its carrying amount exceeds its recoverable amount, which is the higher of the value in use and the fair value less costs to sell of the CGU to which it is allocated. The CGU relates to the reporting segments as reported in note 3. In the impairment tests of goodwill performed, the recoverable amount was determined based on the value in use calculations.

The value in use calculations are based on cash flow forecasts derived from the most recent twelve month financial plans approved by the Board.

Cash flows for the periods beyond the twelve month financial plans for the CGUs to which significant amounts of goodwill were allocated were calculated as follows: cash flows from years two and thereafter were projected to remain constant per annum, so prudently not exceeding the long term growth rates in the principal end markets.

Discount rates were applied to the resulting cash flow projections that reflect current market assessments of the time value of money. Pre tax discount rates used in the annual impairment were 15% (2017: 15%).

Following the review at 31 March 2018, management concluded that no further impairment was necessary.

Management has assessed the sensitivity of the recoverable amounts to key assumptions to be as follows: a one percentage point increase in the pre tax discount rate of 15% would reduce the recoverable amount by £2,292,000; a one percentage fall in operating margin across the CGUs would reduce the recoverable amount by £801,000; and a one percentage point fall in the assumed long term growth rate of 0% would reduce the recoverable amount by £1,279,000.

The net book value of goodwill relating to the Consultancy Services is £17,062,000 (2017: £17,062,000) and International Development £1,131,000 (2017: £1,131,000).


11. OTHER INTANGIBLE ASSETS

Order books

£’000

Customer relationships

£’000

Total acquired intangibles

£’000

Computer software

£’000

Total

£’000

Cost

At 1 April 2016 4,670 18,459 23,129 2,429 25,558

Additions - - - 260 260

Exchange differences - - - 52 52

Disposals - - - (973) (973)

At 31 March 2017 4,670 18,459 23,129 1,768 24,897

Additions - - - 173 173


Disposals - - - (261) (261)

At 31 March 2018 4,670 18,459 23,129 1,714 24,843

Accumulated amortisation

At 1 April 2016 3,647 10,723 14,370 1,893 16,263

Charge for the year 457 1,406 1,863 372 2,235


Disposals - - - (973) (973)

At 31 March 2017 4,104 12,129 16,233 1,339 17,572

Charge for the year 268 892 1,160 265 1,425

Impairment (see note 2) 298 2,108 2,406 - 2,406


Disposals - - - (261) (261)

At 31 March 2018 4,670 15,129 19,799 1,381 21,180

Net book value

At 31 March 2018 - 3,330 3,330 333 3,663

At 31 March 2017 566 6,330 6,896 429 7,325

At 31 March 2016 1,023 7,736 8,759 536 9,295

Where appropriate, intangible assets identified in business combinations have been recognised in accordance with the provisions of IFRS 3 (Business combinations) and IAS 38 (Intangible assets). Intangible assets have only been recognised where they have identifiable future economic benefits that are controlled by the entity, it is probable that these benefits will flow to the entity and their fair value can be measured reliably.

There were no intangible assets in the Company (2017: £nil).


12. PROPERTY, PLANT AND EQUIPMENT

Short leasehold improvements

£’000

Motor vehicles

£’000

Office furniture and equipment

£’000

Total

£’000

Cost

At 1 April 2016 4,527 542 3,783 8,852

Additions 684 23 947 1,654

Exchange differences - 39 133 172

Disposals (17) (849) (866)

At 31 March 2017 5,211 587 4,014 9,812

Additions 831 23 1,655 2,509


Disposals (3,196) (223) (853) (4,272)

At 31 March 2018 2,846 402 4,892 8,140

Accumulated amortisation

At 1 April 2016 3,129 454 2,088 5,671

Charge for the year 461 41 1,168 1,670


Disposals - (17) (845) (862)

At 31 March 2017 3,590 510 2,532 6,632

Charge for the year 364 37 930 1,331


Disposals (3,141) (207) (824) (4,172)

At 31 March 2018 813 353 2,697 3,863

Net book value

At 31 March 2018 2,033 49 2,195 4,277

At 31 March 2017 1,621 78 1,481 3,180

At 31 March 2016 1,398 88 1,695 3,181


13. INVESTMENTS AND JOINT ARRANGEMENTSInvestments

Company investment in subsidiary undertakings

Cost

£’000

Provision

£’000

Value

£’000

At 1 April 2016, 31 March 2017, 31 March 2018 161,796 (109,062) 52,734

The Company’s subsidiaries are:

Subsidiary Place of business* % Holding**

WYG Group Limited England 100

WYG Engineering Limited England 100

WYG Environment Planning Transport Limited England 100

WYG Management Services Limited England 100

WYG International BV Netherlands 100

WYG International Projects Limited England 100

WYG Planning Limited England 100

Arndale 22 Limited England 100

North Associates (Cumbria) Limited England 100

Taylor & Hardy Limited England 100

WYG Engineering (Northern Ireland) Limited Northern Ireland 100

WYG Environmental & Planning (Northern Ireland) Limited Northern Ireland 100

WYG Management Services (Northern Ireland) Limited Northern Ireland 100

WYG International Danismanlik Limited Sirketi Turkey 100

WYG International Sp.z.o.o. Poland 100

PSDB Sp z.o.o. Poland 100

WYG Consulting Sp z.o.o Poland 100

WYG HR Consulting Sp z.o.o. Poland 100

WYG International Consulting SRL Romania 100

WYG Bulgaria EOOD Bulgaria 100

WYG Savjetovanje d.o.o. Croatia 100

WYG Kenya Limited Kenya 100

WYG Projects Uganda Limited Uganda 100

WYG Advisory Services (Proprietary) Limited South Africa 100

Africa Infrastructure Technical Services South Africa 100

Alliance Environment and Planning Limited *** England 100

Delta Partnership Solutions Limited *** England 100

FMW Consultancy Limited *** England 100


13. INVESTMENTS AND JOINT ARRANGEMENTS CONTINUED

Subsidiary Place of business* % Holding

Signet Planning Limited *** England 100

WYG East Africa Limited Kenya 100

o.o.o. WYG Russia 100

o.o.o.IEEC Russia 100

International Economic & Energy Consulting Limited *** England and Wales 100

International Management Consultants Limited *** England 100

Management Consultants Group Limited *** England 100

Trench Farrow Limited *** England 100

White Young Green International Limited *** England 100

White Young Green Limited *** England 100

WYG Projects Nigeria Limited Nigeria 100

WYG Zimbabwe (Private) Limited Zimbabwe 100

WYG Consulting Limited England 100

WYG Advisory Limited England 100

Waste Management Research Limited England 100

IMC Montan Limited (Joint venture) England 50

The investments in all of the above companies (excluding WYG Group Limited which is held directly) are held through subsidiary undertakings.

* All subsidiaries located in England have their registered office at Arndale Court, Otley Road, Headingley, Leeds LS6 2UJ;

Northern Ireland subsidiaries at 1 Locksley Business Park, Montgomery Road, Belfast BT6 9UP;

Netherlands subsidiary: Prins Bernhardplein 200, 1097JB Amsterdam, Netherlands

Turkey subsidiaries at Binası Mustafa Kemal Mahallesi, 2128, Sokak, No 14, Cankaya, Ankara, 06520, Turkey

Poland subsidiaries at Bitwy Warszawskiej 1920 roku nr 7, 02-366, Warsaw, Poland snd Ul. Marynarska 15 02-674, Warsaw, Poland

Romanian subsidiaries at 5 Scarlatescu, Bucharest 1, Romania

Bulgaria subsidiaries at 40 Vasil Levski Blvd, Floor 3, Sofia, Bulgaria

Croatia subsidiaries at Ulica grada Vukovara 269G, Zagreb 10000, Croatia

Kenya subsidiaries at Plot 2/14 Kilimani Road Nairobi Kenya

Uganda subsidiaries at Plot 91 Kira Road, Bukoto, Kampala, PO BOX 73331, Uganda

South Africa subsidiaries at Ground Floor, Block G, Hatfield Gardens, 333 Grosvenor St, Pretoria.

** The % holding relates to both the proportion of ownership interest and proportion of voting power held.

*** For the year ended 31 March 2018, these dormant subsidiaries are entitled to exemption from audit under s479A of the Companies Act 2006relating to subsidiary companies.

Joint arrangements

The significant arrangements over which the Group currently exercises joint control are shown below:

Joint arrangement Nature Activity % control Principal location

IMC Montan JV Incorporated joint venture Multi-disciplinary consultants

50 Russia

The IMC Montan joint venture is accounted for as an investment using the equity method.

IMC Montan JV, the 50% owned joint venture had revenue of £3.0m (2017: £2.6m), an operating profit of £260,000 (2017: profit £447,000) and profit after tax of £166,000 (2017: profit of £395,000). The joint venture paid dividends to its owners of £53,000 (2017: £nil).

The joint venture had current assets of £1,956,000 (2017: £1,663,000) and current liabilities of £482,000 (2017: £554,000) at 31 March 2018.


14. DEFERRED TAX The following are the principal deferred tax assets and liabilities recognised by the Group and movements thereon during the current year and prior year:

Accelerated tax

depreciation

£’000

Share based

payments

£’000

Tax deductible

goodwill

£’000

Retirement benefit

obligations

£’000

Intangible assets

£’000

Other temporary

differences

£’000

Losses

£’000

Deferred tax assets

not recognised

£’000

Total

£’000

Deferred tax asset at 1 April 2016 2,164 1,423 449 442 - 833 6,998 (11,085) 1,224

Deferred tax liability at 1 April 2016 (10) - - (280) (1,659) (562) - - (2,511)

Credit/(charge) to income 159 (720) (36) 237 415 (675) (654) 1,778 504

Effect of change in tax rates (129) (39) (23) (22) 38 (4) (352) 517 (14)

Foreign exchange - - - - - 8 - - 8

As at 31 March 2017 2,184 664 390 377 (1,206) (400) 5,992 (8,790) (789)

Deferred tax asset at 31 March 2017 2,194 664 390 377 - 419 5,992 (8,790) 1,246

Deferred tax liability at 31 March 2017 (10) - - - (1,206) (819) - - (2,035)

(Charge)/credit to income (241) (618) (34) (62) 628 (19) 827 130 611

Foreign exchange - - - - - (39) - - (39)

As at 31 March 2018 1,943 46 356 315 (578) (458) 6,819 (8,660) (217)

Deferred tax asset at 31 March 2018 1,949 46 356 315 - 348 6,819 (8,660) 1,173

Deferred tax liability at 31 March 2018 (6) - - - (578) (806) - - (1,390)

1,943 46 356 315 (578) (458) 6,819 (8,660) (217)

The Company had no deferred tax assets or liabilities at either year end.

Deferred tax assets in relation to losses have been recognised with regard to expected future taxable profits.

At the balance sheet date the Group had unused tax losses of £40.0m (2017: £34.6m) available for offset against future profits. A deferred tax asset has been recognised in respect of £0.4m (2017: £0.4m) of such losses. No deferred tax asset has been recognised in respect of the remaining £6.8m (2017: £5.9m).


15. WORK IN PROGRESS Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Work-in-progress 24,910 31,124 - -

Provision (1,188) (1,138) - -

Net work-in-progress 23,722 29,986 - -

The value of work in progress comprises the costs incurred on a contract plus an appropriate proportion of overheads and attributable profit. Profit is recognised on a percentage completion basis when the outcome of a contract or project can be reasonably foreseen. Provision is made in full for estimated losses.

16. TRADE AND OTHER RECEIVABLES Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Amounts falling due within one year

Amounts receivable on contracts 25,132 26,998 - -

Less: provision for impairment of trade receivables (1,036) (536) - -

Trade receivables – net 24,096 26,462 - -

Prepayments and accrued income 3,202 2,777 - -

Other receivables 399 1,084 - -

27,697 30,323 - -

Amount receivable from the sale of services can be analysed as follows

Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Amount receivable not past due 14,158 18,979 - -

Amount receivable past due but not impaired 8,967 6,673 - -

Amount receivable impaired (gross) 2,007 1,346 - -

Less impairment (1,036) (536) - -

24,096 26,462 - -

The allocation of the impairment according to invoice due date is as follows:

Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Between 61 and 120 days 23 - - -

Between 121 and 150 days 41 - - -

Between 151 and 330 days 251 209 - -

Greater than 330 days 721 327 - -

1,036 536 - -


16. TRADE AND OTHER RECEIVABLES CONTINUED

At 31 March 2018 trade receivables of £9.0m (2017: £6.7m) were past due but not impaired. These relate to a number of independent customers for whom there is no recent history of default. The ageing analysis of these trade receivables according to invoice due date is as follows:

Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Between 0 and 30 days 5,506 2,635 - -

Between 31 and 60 days 1,079 911 - -

Between 61 and 120 days 1,608 1,717 - -

Between 121 and 150 days 172 456 - -

Between 151 and 330 days 602 954 - -

8,967 6,673 - -

The carrying amounts of the Group’s trade receivables are denominated in the following currencies

Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Sterling 17,310 19,224 - -

Euro 6,482 6,450 - -

Polish Zloty 668 1,040 - -

Other 672 284 - -

25,132 26,998 - -

Movements on the Group provision for impairment of trade receivables are as follows

Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

At 1 April 536 1,004 - -

Provision for receivables impairment 727 226 - -

Utilised in the year (232) (708) - -

Exchange differences 5 14 - -

As at 31 March 1,036 536 - -

The creation of provision for impaired receivables has been included in operating expenses in the income statement.

The other classes within trade and other receivables do not contain impaired assets. There is no material difference between the carrying value and the fair value of financial assets and financial liabilities at the balance sheet date.

The maximum exposure to credit risk at the reporting date is the fair value of each class of receivable mentioned above. The Group does not hold any collateral as security.


17. TRADE AND OTHER PAYABLES

Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Current

Trade payables 10,028 10,493 - -

Payments received on account 8,958 12,785 - -

Social security and other taxes 4,695 5,946 - -

Accruals and other payables 16,831 19,651 - -

Amounts owed to subsidiary undertakings - - 15,983 14,173

Deferred consideration - 733 - -

40,512 49,608 15,983 14,173

Amounts owed to subsidiary undertakings are repayable on demand and command no interest.

Included in Payments received on account are £6.2m (2017: £9.6m) of amounts which are secured with an advance payment bond.

18. PROVISIONS

Claims

£’000

Vacant leasehold properties

£’000

Total

£’000

At 1 April 2016 2,169 3,771 5,940

Charge in year 1,056 - 1,056

Utilised during the year (2,025) (1,042) (3,067)

Release of provision - (752) (752)

At 31 March 2017, 1 April 2017 1,200 1,977 3,177

Charge in year 2,700 285 2,985

Utilised during the year (1,475) (880) (2,355)

At 31 March 2018 2,425 1,382 3,807

Claims

Provisions are made for current and estimated obligations in respect of claims made by contractors and the general public relating to accident and other insurable risks arising as a result of the business activities of the Group. Given the nature of these items, the expected timing of payments is uncertain.

Vacant leasehold properties

The Group has a small number of vacant leasehold properties, the majority of which are held under head leases expiring within the next year. Provision has been made for the residual lease commitments together with other outgoings, after taking into account assumptions relating to later periods of sub-lease.


19. BORROWINGS

Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

Current

Bank loans and overdrafts (all payable on demand) 6,000 4,000 - -

6,000 4,000 - -

Non-current

Bank loans 5,000 5,000 - -

5,000 5,000 - -

Financial liabilities are repayable as follows:

On demand or within one year 6,000 4,000 - -

In the second year 5,000 5,000 - -

11,000 9,000 - -

The financial liabilities above are all denominated in Sterling.

The Group has outstanding issued bonds and guarantees to the value of £12,278,000 (2017: £15,394,000). No liability is expected to arise from these bonds and guarantees.

Included in bank loans and overdrafts is £11,000,000 (2017: £9,000,000) of loans drawn under the Group’s five year facility with HSBC. The facility allows for amounts to be drawn for variable periods, with each amount attracting an interest cost of LIBOR plus a margin of between 1.6% and 2.3% (2017: 1.65% to 2.35%). At 31 March 2018, whilst the loans have been drawn for short term durations, it is the Directors’ current intention that £5,000,000 will continually be renewed for a period of more than one year. Consequently this amount has been disclosed as a non-current liability.


20. FINANCIAL INSTRUMENTSThe Group is exposed to a number of different market risks in the normal course of business including foreign currency risks, credit risks and cash flow and interest rate risks.

Risk management is carried out by Group Treasury under policies approved by the Board of Directors. These principles are embedded in the Group Treasury and Cash Management Operating Guidelines and Procedures. The Board provides written principles for overall risk management, as well as written policies covering specific areas, such as currency exposure management, interest rate risk, working capital control and investment of excess liquidity.

Foreign Currency Risk

The Group’s overall risk management programme seeks to minimise potential adverse effects on the Group’s financial performance. Policy is to manage centrally the Group’s liquidity, funding and exposure to foreign currency risk in a manner which ensures straightforward administration, minimisation of risk and operational flexibility.

The Group is exposed to foreign currency risk on sales and purchases that are denominated in currencies other than Sterling. The currency giving rise to this risk is primarily the Euro, though most of the Group’s trading is denominated in the currencies relevant to the local subsidiaries, thus matching the currency with its cost base. As a result the Group does not hedge everyday foreign currency transactions.

The table below shows the extent to which Group companies have monetary assets and liabilities in currencies other than the local functional currency:

Functional currency of Group operations

Sterling

2018

£’000

Euro

2018

£’000

Sterling

2017

£’000

Euro

2017

£’000

Sterling - 2,110 - 1,625

Euro 1,265 - 178 -

US Dollar 167 157 117 321

Polish Zloty - 828 - 1,278

Turkish Lira - (244) - (887)

Other - 563 - 589

1,432 3,414 295 2,926

At 31 March 2018 if Sterling had weakened/strengthened by 10% against the Euro, with all other variables held constant, post-tax profit for the year would have been affected by +/- £0.1m.

Credit Risk

Credit risk arises from deposits with banks and credit exposure to customers, including outstanding receivables and invoiced work performed for these parties.

The Group has a customer credit policy in place and the exposure to credit risk is monitored on an ongoing basis. At 31 March 2018 there were no significant concentrations of credit risk. The maximum exposure to credit risk is the carrying amount of each financial asset included on the balance sheet.

Liquidity risk

Established procedures are in place to ensure that the operational and working capital requirements of the Group can be met at all times. These include:

• regular review, monitoring and forecasting of working capital requirements across Group companies;

• use of short term, local bank facilities.

Cash Flow and Interest Rate Risk

At 31 March 2018 the Group had committed bonding and debt facilities of £40.0m (2017: £33.0m).

In September 2017 the Group extended its committed multi-currency revolving credit facility with HSBC. The facility is now £35m and runs until September 2022, and it offers broad flexibility between debt and bonding requirements. The flexible debt facility allows for amounts to be drawn for variable periods, allowing the Group to manage cash flows and interest costs. The Group’s exposure is with the movement of LIBOR, and amounts payable will vary according to the change in the LIBOR rate.

At 31 March 2018 all financial liabilities are floating rate liabilities.

Fair Values

The fair values of the financial assets and liabilities of the Group are considered to be materially equivalent to their book value.


21. SHARE CAPITAL 2018

£’000

2017

£’000

Issued, authorised and fully paid:

Ordinary:

72,669,665 (2017: 69,898,105) new ordinary shares of 0.1p each 73 70

4,540,758 (2017: 4,540,758) convertible shares of 0.1p each 5 5

78 75

The ordinary shares have full voting rights and are entitled to participate in a return of capital or assets.

The convertible shares are subject to certain conditions, and have rights of conversion into ordinary shares. The convertible shares have no voting, economic or other rights save certain circumstances, and are not entitled to participate in a return of capital or assets. The convertible shares are not listed on AIM or any other investment exchange and the holder is entitled to convert the convertible shares into ordinary shares at any time provided that:

• The Company’s volume weighted average ordinary share price rises above £1.50 for a period of at least 25 consecutive trading days between the second and tenth anniversary following the placing in July 2011; or

• An offer is made to acquire the entire issued share capital of the Company which becomes unconditional in all respects (or, if conducted by way of a scheme of arrangement, such scheme of arrangement becomes effective); or

• The ordinary shares cease to be listed either on AIM or the main market of the London Stock Exchange.

The convertible shares have been recorded as equity as the holders do not have an unconditional right to require their redemption.

The issues of shares in the year were made to satisfy the exercise of share options (note 26).

22. CASH GENERATED FROM/(USED IN) OPERATIONS

Group Company

2018

£’000

2017

£’000

2018

£’000

2017

£’000

(Loss)/profit from operations (4,761) 2,153 (412) (435)

Adjustments for:

Depreciation of property, plant and equipment 1,331 1,670 - -

Amortisation and impairment of intangible assets 3,832 2,235 - -

Loss on disposal of property, plant and equipment 100 4 - -

Share options (credit)/charge (251) 742 - -

Operating cash flows before movements in working capital 251 6,804 (412) (435)

Decrease in work in progress 6,822 1,976 - -

Decrease/(increase) in receivables 2,927 (7,030) - 2,164

(Decrease)/increase in payables (8,842) 1,630 419 (1,737)

Cash generated from/(used in) operations 1,158 3,380 7 (8)


23. ANALYSIS OF CHANGES IN NET DEBT

Group

At 1 April 2017

£’000

Cash flows

£’000

Other non-cash items

£’000

At 31 March 2018

£’000

Cash and cash equivalents 6,518 (1,890) 122 4,750

Bank loans and overdrafts (9,000) (2,000) - (11,000)

Net (debt)/cash (2,482) (3,890) 122 (6,250)

Cash in restricted access accounts (1,214) (50) (32) (1,296)

Unrestricted debt (3,696) (3,940) 90 (7,546)

Restricted cash relates to restricted access accounts in WYG International BV. Other non-cash movements represent currency exchange differences.

24. CONTINGENT LIABILITIES AND GUARANTEESThe Company and its subsidiary undertakings cross guarantee to the Group’s principal bankers the loans and overdrafts, if any, of each Company covered by the guarantee. At 31 March 2018 the Group’s loans and overdrafts amounted to £11,000,000 (2017: £9,00,000).

The Group has outstanding bonds and guarantees to the value of £12,278,000 (2017: £15,394,000) in the ordinary course of business. No liability is expected to arise from these bonds and guarantees.

25. FINANCIAL COMMITMENTSAt 31 March 2018, the Group and the Company had capital commitments outstanding of £nil (2017: £nil). The Company had no capital commitments at either year end.

At 31 March 2018, the Group had outstanding commitments for future minimum lease payments under non-cancellable operating leases, which fall due as follows:

2018 2017

Group

At 1 April 2017

£’000

Cash flows

£’000

Other non-cash items

£’000

At 31 March 2018

£’000

Within one year 2,214 670 2,830 506

In the second to fifth years inclusive 4,787 1,377 3,240 816

After five years 3,129 - 114 -

10,130 2,047 6,184 1,322


26. SHARE-BASED PAYMENTS At 31 March 2018 outstanding options and awards to subscribe for ordinary shares in the Company, granted in accordance with the rules of the relevant share option schemes were as follows:

Transformation Incentive Plan

Matching share awards

Performance share gain

Restricted share plan

Deferred annual bonus

share plan Total

Exercise price 0.1p 0.1p 0.1p 0.1p 0.1p

At 1 April 2016 4,103,907 500,000 1,407,934 1,140,500 - 7,152,341

Awarded - - 1,587,439 30,000 78,602 1,696,041

Lapsed (307,581) - (431,262) (92,781) (5,075) (836,699)

Exercised (1,480,758) - - - - (1,480,758)

At 31 March 2017 2,315,568 500,000 2,564,111 1,077,719 73,527 6,530,925

At 1 April 2017 2,315,568 500,000 2,564,111 1,077,719 73,527 6,530,925

Awarded - - 1,824,260 185,000 - 2,009,260

Lapsed - - (1,186,620) (171,900) (10,239) (1,368,759)

Exercised (2,255,568) (500,000) - (25,319) (33,492) (2,814,379)

At 31 March 2018 60,000 - 3,201,751 1,065,500 29,796 4,357,047

Exercisable at 31 March 2018 60,000 - - - - 60,000

Fair value of options issued in the year - - 93p 93p -

Weighted average share price at date of exercise 63.5p 64p - 92.5p 63p

Transformation Incentive Plan (TIP)

On 12 July 2011 the Company established the TIP in order to incentivise the Company’s most senior executives. The TIP operated as a standard long-term incentive plan under which share option awards were granted. The exercise price for awards is a nominal amount. Awards under the TIP were originally intended to vest on the achievement of share price threshold targets for the Ordinary Shares (based on when the options were issued over a five year timescale).

On 24 September 2015, 12.2m options previously awarded under the TIP were surrendered. The remaining options under the TIP scheme had performance thresholds of £1.25, £1.30, and £1.35 (which have all been met) and £1.50 (which was not met prior to the closure of the plan).

Matching share award

In addition, on 12 July 2011, the Company established a separate share matching arrangement for the then Chairman, Mike McTighe to ensure his continued retention within the business (the ‘Matching Share Award’). Under the Matching Share Award, in consideration for Mr McTighe, investing £100,000 to acquire new Ordinary Shares, he was granted a share option award of 2.5 Ordinary Shares for each new Ordinary Share so acquired, being a total of 500,000 Ordinary Shares (‘Matching Shares’). The Matching Share Award had a nominal value exercise price. There were no performance conditions that apply to this award. The Matching Share Award vested on 12 July 2014 (being the third anniversary of the admission of the New Ordinary Shares to trading on AIM) and were fully exercised on 6 September 2017.

Performance share plan (PSP)

The Performance Share Plan (PSP) covering the senior executive and leadership teams only was established on 24 September 2015. Awards under the PSP are made each year and will only vest on the achievement of earnings per share (EPS) growth and total shareholder return (TSR) targets measured over three years and are dependent on continued employment.

The targets are summarised as follows:

Performance level Potential vesting of award (50% TSR; 50% EPS) TSR attainment EPS attainment (3 year growth)

Maximum 100% Upper Quartile or above 50% or more growth

Intermediate Between 25% and 100% on a straight line basis Median to Upper Quartile Between 25% and 50% growth

Threshold 25% Median 25% growth

Options issued under the PSP attract a charge under IFRS. The fair value of these share options has been calculated using the Monte-Carlo pricing model. The key assumptions within the model are the risk free rate of interest (0.33%), the dividend yield (0.89%) and the Company’s share price volatility (19- 32%).


26. SHARE-BASED PAYMENTS CONTINUEDRestricted share plan (RSP)

The Restricted Share Plan (RSP) covers other key senior employees. There are no targets or market conditions attached to these awards. All awards will trigger after three years’ continued employment.

Options issued under the RSP attract a charge under IFRS. The fair value of these share options has been calculated by discounting the share price at the grant date by the dividends over the expected life from the date of calculation. The key assumptions within the calculation are the dividend yield (0.89%) and the expected life (2.5 years).

Deferred Annual Bonus Plan (DABS Plan)

The DABS Plan is a component of the revised annual bonus arrangements for executives approved by shareholders at the AGM in September 2015. Bonuses can only be earned if challenging performance targets determined by the Committee at the start of the financial year are achieved. It includes significant elements of bonus deferral in the form of cash and shares such that two thirds of any bonus outcome will be deferred for a period of three years, one half of which (i.e. one third of the bonus outcome) will be deferred in the form of a cash award and one half of which (i.e. one third of the bonus outcome) will be an award of shares under the DABS Plan.

Employee Benefit Trust

At 31 March 2018 the EBT held 25,500 (2017: nil) ordinary shares with a cost of £23,659 (2017: £nil) and a market value of £8,925 (2017: £nil).

Weighted average exercise price and charges

The options outstanding at 31 March 2018 had a weighted average exercise price of 0p (2017: 0p) and a weighted average remaining contractual life of 1.5 years (2017: 2.5 years).

During the year the Group recognised total credit of £251,000 (2017: £742,000 charge) in relation to share-based payment transactions.

27. RETIREMENT BENEFIT SCHEMESDefined Contribution Schemes

The Group operates a defined contribution retirement benefit scheme for all UK qualifying employees with Aegon. The assets of the scheme are held separately from those of the Group in funds under the control of trustees.

The total cost charged to income of £3,867,000 (2017: £3,722,000) represents contributions payable to these schemes by the Group at rates specified in the rules of the plan. As at 31 March 2018, contributions of £474,000 (2017: £350,000) due in respect of the current reporting period had not been paid over to the scheme.

Defined Benefit Schemes

The Group has residual liabilities in respect of one defined benefit scheme (the White Young Consulting Group Limited Retirement Benefit Plan (1986) (the ‘1986 Scheme’)). In 2013 we reached a full and final, binding settlement with the representative beneficiary and independent trustee of the 1986 Scheme, concluding an issue that had been in dispute since 2008. Under the Court approved settlement, we will pay £3.2m into the Scheme in instalments over 12 years. Other than this, WYG has no further liability to the 1986 Scheme.

On 20 March 2015, the 1986 Scheme was transferred to the Financial Assistance Scheme and, in accordance with s161 of the Pensions Act 2004, is treated as having been wound up from that date.

On 31 March 2016, the Group effected a buyout of all its liabilities in respect of the only other defined benefit scheme in the Group, the WYD pension scheme (the ‘WYD’ Scheme). The process of formally winding up the WYD Scheme was completed on 31 December 2016.

The remaining scheme gives rise to an overall net pension liability at 31 March 2018 of £1.9m (2017: £2.1m).

The net liability is included in the balance sheet in Retirement benefit obligations. Amounts recognised in income in respect of this defined benefit scheme is £nil (2017: £nil).

28. RELATED PARTIESThere is no ultimate controlling party.

Company

Funds are transferred within the Group, dependent on the operational needs of individual companies. Balances owed by other Group undertakings are shown in note 18 to the accounts. Investment income of £nil (2017: £nil) was received from a subsidiary company. There are no material transactions between WYG plc and its subsidiaries.


Proud to support our armed forces.

Armed Forces Day 2017

125


Shareholder information

Information for Shareholders

2018 2019

6 Sep: Ex-dividend date for final dividend

7 Sep: Final dividend record date

3 Oct: Final dividend payment date* April: Interim dividend payment date**

* Subject to shareholder approval** Subject to Board approval

23 Sep: AGM 5 Dec: Half-Year Report

June: Preliminary Results 2019

March: Trading Update


ANNUAL GENERAL MEETINGThe AGM will be held at the Company’s registered office

at Arndale Court, Otley Road, Headingley, Leeds LS6 2UJ

on 25 September 2018 at 10.00am. Formal notice of the

AGM, will be communicated separately to shareholders

and made available on the Company’s website at

www.wyg.com at the appropriate time.

SHARE PRICEInformation on our share price is available on the Company’s

website, www.wyg.com, numerous other websites and is

also listed in some daily newspapers.

REGISTRARAll matters relating to the administration of shareholdings

should be directed to Link Asset Services, The Registry,

34 Beckenham Road, Beckenham, Kent BR3 4TU,

telephone: 0871 664 0300 (calls cost 12p per minute plus

network extras, lines are open 9:00am - 5:30pm Monday

to Friday for UK callers or if calling from overseas

+44 (0) 37 1664 0300).

You can register for electronic communications and access

your personal shareholding at www.signalshares.com.

If you have not previously registered for this service you will

require your investor code which is printed on your share

certificate or statement of holding.

http://www.wyg.com

http://www.wyg.com

http://www.signalshares.com


ELECTRONIC COMMUNICATIONSShareholder communications can be received

electronically rather than receiving hard copies by post.

This offers shareholders an opportunity to receive company

documentation quickly and in a user-friendly format while

reducing costs and the consumption of natural resources.

Please note that all notices of meetings, the Annual

Report & Accounts and other shareholder documents, are

published on the Company website at www.wyg.com

WEBSITEThe WYG website, www.wyg.com, includes a section for

investors that provides a wide range of information about

the Company, including the latest regulatory news and

downloadable copies of the report and accounts.

UNSOLICITED EMAILThe Company is obliged by law to make its share register

available to third parties who may then use it for a mailing

list. If you are a UK shareholder and you wish to limit receipt

of unsolicited email you may do so by registering with the

Mailing Preference Service (MPS). Registration can be made

online at www.mpsonline.org.uk or via telephone on

+44 (0) 207 291 3310.

SHAREGIFTIf you have only a small number of shares which would cost

more for you to sell than they are worth, you may wish to

consider donating them to the charity ShareGift (Registered

Charity 1052686) which specialises in accepting such

shares as donations. The relevant stock transfer form may

be obtained from the Company’s Registrars. There are no

implications for Captial Gains Tax purposes (no gain or loss)

on gifts of shares to charity and it is also possible to obtain

income tax relief. Further information about ShareGift may

be obtained on: +44 20 7930 3737 or from www.sharegift.org.

WARNING TO SHAREHOLDERSMany companies are now aware that shareholders have

received unsolicited telephone calls or correspondence

regarding investment matters, typically from overseas-

based ‘brokers’. They often target UK shareholders

offering to buy shares at a discount or to sell what turn

out to be worthless or high-risk investments. These are

commonly known as ‘boiler-room scams’. Such ‘brokers’

can be very persistent and very persuasive. The following

advice is provided:

• Make sure you get the name of the person calling and their organisation

• Only ever deal with companies authorised by the Financial Conduct Authority (FCA) at www.fca.org.uk/firms/financial-services-register

• Report the matter to the FCA by completing their online form at http://www.fca.org.uk/consumers/report-scams-unauthorised-firm or call the FCA Consumer Helpline on (UK): 0300 500 8082

• Callers may be persistent so hang up the phone if they continue to contact you.

Please be aware that if you deal with an unauthorised

firm you will not be eligible to receive payment under the

Financial Services Compensation Scheme.

http://www.wyg.com

http://www.wyg.com

http://www.sharegift.org

http://www.fca.org.uk/firms/financial-services-registe

http://http://www.fca.org.uk/consumers/report-scams-unauthorised-firm

http://http://www.fca.org.uk/consumers/report-scams-unauthorised-firm


Looking west from our London office at Angel Court.

129


Financial Summary

CONSOLIDATED INCOME STATEMENT

IFRS

2018

£’000

2017

£’000

2016

£’000

2015

£’000

2014

£’000

Results

Revenue 154,351 151,824 133,482 130,464 126,914

Operating profit 1 3,506 8,768 7,221 5,802 4,806

Profit before tax 1 2,919 8,214 7,020 5,686 4,229

(Loss)/Profit attributable to the owners of the parent (5,012) 2,378 2,832 1,923 2,053

Dividend per ordinary share:

Interim paid 0.6p 0.6p 0.5p 0.3p -

Final – proposed 1.2p 1.2p 1.0p 0.7p 0.5p

Share price at 31 March 34p 91.5p 134.5p 111p 110p

1 Before separately disclosed items.

CONSOLIDATED BALANCE SHEET

IFRS

2018

£’000

2017

£’000

2016

£’000

2015

£’000

2014

£’000

Goodwill and other intangibles 21,856 25,518 27,488 18,731 17,598

Property, plant and equipment 4,277 3,180 3,181 2,307 2,242

Work in progress 23,722 29,986 30,372 21,145 21,563

Receivables 27,697 30,323 23,848 21,108 22,601

Payables (45,741) (54,951) (56,789) (52,555) (58,658)

31,811 34,056 28,100 10,736 5,346

Shareholders’ equity 25,561 31,574 28,281 22,546 20,087

Net financial liabilities/ (assets) 6,250 2,482 (181) (11,810) (14,741)

31,811 34,056 28,100 10,736 5,346

131WYG plc Annual Report & Accounts 2018 131

Advisers

131

COMPANY SECRETARY AND REGISTERED OFFICEBenjamin Whitworth

Arndale Court

Otley Road

Headingley

Leeds

LS6 2UJ

COMPANY NUMBER01869543

INDEPENDENT AUDITORDeloitte LLP

1 City Square

Leeds

LS1 2AL

BANKERSHSBC Bank plc

33 Park Row

Leeds

West Yorkshire

LS1 1LD

REGISTRARSLink Asset Services

The Registry

34 Beckenham Road

Beckenham

Kent

BR3 4TU

SOLICITORSDLA Piper UK LLP

3 Noble Street

London

EC2V 7EE

NOMINATED ADVISER AND JOINT CORPORATE BROKERNplus1 Singer Advisory LLP

1 Bartholomew Lane

London

EC2N 2AX

JOINT BROKERWH Ireland Limited

Royal House

28 Sovereign Street

Leeds

LS1 4BJ

FINANCIAL PUBLIC RELATIONSMHP Communications

6 Agar Street

London

WC2N 4HN

132

Birmingham Conservatoire

132

http://www.wyg.com

http://www.wyg.com

https://www.instagram.com/wyggroup/

https://twitter.com/wyggroup

https://www.linkedin.com/company/wyg-group

Documents

ii WYG plc Annual Report & Accounts 2018 · Corporate Governance Corporate responsibility 56 Community Engagement 56 Responsible trading and CO 2 ... separately disclosed items were