21st Mar 2018 13:21
LAIRD PLC
Annual Report and Notice of Annual General Meeting
Laird PLC (the "Company") announces that it has today published its 2017 Annual Report and Accounts and Notice of the 2018 Annual General Meeting.
The documents listed below have been made available to shareholders and will be submitted to the UK Listing Authority for publication through the National Storage Mechanism where they will shortly be available for inspection at www.morningstar.co.uk/uk/NSM.
Documents:
Annual Report and Accounts 2017
Notice of Annual General Meeting
Form of Proxy
Copies of the Annual Report and Accounts 2017 and Notice of Annual General Meeting will also shortly be available on the Company's website at www.laird-plc.com.
The Company's Annual General Meeting will be held on Friday, 27 April 2018 at 10.30 am at the offices of Freshfields Bruckhaus Deringer LLP, Northcliffe House, 28 Tudor Street, London, EC4Y 0AY.
A condensed set of Laird's financial statements and information on important events that have occurred during the financial year and their impact on the financial statements were included in Laird's final results announcement released on 1 March 2018. That information, together with the information set out below, which is extracted from the 2017 Annual Report, constitutes the material required by Disclosure and Transparency Rule 6.3.5 to be communicated to the media in unedited full text through a Regulatory Information Service. This announcement is not a substitute for reading the full 2017 Annual Report. Page numbers and cross-references in the extracted information below refer to page numbers and sections in the 2017 Annual Report.
J G du Plessis
General Counsel and Company Secretary
020 7468 4040
Appendix A
Principal Risks and Uncertainties (P39 0f 2017 Annual Report)
Risk | Description and Impact | Mitigation | Risk Velocity |
Strategic 1 Key Customer Dependency Aligned to strategy points: 3,4,5 | The Group is dependent on a small number of large global customers with whom it does not have any contractual guarantees for a significant portion of its sales and a decrease in or the loss of business from one or more of these customers or increased pricing pressure from one or more of these customers would have a material adverse effect on the Group's business, results of operations and financial condition.
The Group's customers in its largest business unit typically do not commit to long-term purchase contracts, which results in low visibility on future cash flows in that business unit. | • Protecting our position by maintaining and extending a broad customer base and monitoring the market to support a swift response to market changes. • Developing the business into new and attractive growth markets in line with strategic objectives. • Maintaining a competitive and flexible manufacturing base. • Differentiating Laird with customers. • Contract review and negotiation through in-house legal team and external advisers. | Rapid. Contract terms with certain key customers could lead to short notice for significant changes to expected sales volumes. |
Strategic 2 Automotive Market Dynamics Aligned to strategy points: 2,3,4 | Rapid growth of Laird business in the automotive sector brings with it the risks associated with bidding in a competitive market for very long-term business with a limited number of large customers. Participation requires substantial up-front investment in design and development capability, well in advance of associated revenues. | • Robust business opportunity evaluation and approval processes. • Differentiating Laird with customers to achieve close partnerships. • Strategic options to balance Laird's overall business portfolio. | Slow. Automotive market dynamics drive long term visibility of the risk and slow velocity to impact. |
Strategic 3 Increased Trade Protectionism Aligned to strategy points: 3 & 5 | The Group may be adversely impacted by a move towards protectionist international trade policies. Recent political events in the United States, Europe and elsewhere have signalled increasing vocal support for a move toward protectionist international trade policies. Restrictions on or rising costs of global free trade may require the Group to relocate manufacturing activities, which could entail significant costs and could have a material adverse effect on the Group's business, financial condition and results of operations in the short-term. | • Global manufacturing footprint flexibility. • Trade Compliance optimisation strategies. • Contractual risk sharing with customers and suppliers. | Slow. Changes to international trade treaties are subject to detailed negotiation and national political governance mechanisms and subject to World Trade Organisation rules. |
Operational 4 Intellectual Property Rights (IPR) Aligned to strategy points: 1 & 4 | If the Group's products, systems or solutions are found to infringe the intellectual property rights of others, the Group may be required to change its business practices and may also become liable for damages and face invalidation of the Group's intellectual property rights.
Failure to protect the Group's intellectual property rights could adversely affect the Group's financial condition and results of operations.
| • Specialist IPR legal review. • Patent checks in the product development process. • Customer audit compliance. • Patent registration strategy. • Internal monitoring of patent registrations. | Slow. Long tail negotiation and litigation risks. |
Risk | Description and Impact | Mitigation | Risk Velocity |
Operational 5 Product Risk Aligned to strategy points: 1,4,5 | Actual, possible or perceived defects, failures or quality issues associated with the Group's products could lead to product recalls and litigation, including product liability claims, or negative publicity that could materially adversely affect the Group's reputation, business, financial condition and results of operations. | • Product and operations quality control processes. • Supplier quality review and audits. • Automotive, ISO and other relevant standards compliance Production controls; Logistics standards compliance; Customer relationship management. • Contractual controls to limit liability where possible. • Proactive customer relationship management. | Rapid. A product incident or failure can in some cases lead to a short notice product recall. |
Operational 6 Operations Continuity Aligned to strategy points: 1 & 5 | Disruptions of operations at the Group's key factories or sites due to disasters or other business continuity events could impact the Group's ability to meet its production requirements and a failure to successfully recover from such an event could have a material adverse effect on the Group's business.
A cybersecurity incident could negatively impact the Group's business or operations or may harm its relationships with customers. | • Risk management and recovery plans in place at site, business unit and corporate functional levels. • Use of expert partners to continuously improve site risk management controls IT security and back-up procedures. • Flexing production between sites. • Cyber and IT protections and Business Interruption Plans. | Rapid. Major business interruption incidents such as natural catastrophes, or a site fire, can have an immediate and enduring operational impact. |
Operations 7 Contract Risk Aligned to strategy points: 3,4,5 | Market dynamics in some parts of the business with large key customers could lead to onerous or imbalanced contracts, potentially for very long term business, where assumptions on future cost and efficiencies could lead to commitments to potentially unprofitable business and/or unlimited or very high potential penalties and legal costs. | • Robust business opportunity evaluation and approval processes. • Comprehensive contract review by internal legal function. • Effective operational efficiency mechanisms. • Product quality and compliance controls. | Moderate. Velocity to impact is assessed as moderate reflecting the contractual and litigation Characteristics of the risk. |
Finance 8 Foreign Exchange Rate Movement Aligned to strategy points: 3 & 5 | Exchange rate movements could impact on reported profit through a combination of translational and transactional risk. | • Commercial management of exposures. • Hedging activity. • Matching of currency borrowings. • Debt apportionment in currencies to offset translation risk. | Moderate. Risk is driven by in year trends rather than short term fluctuations. |
Appendix B
Directors' Responsibility Statements (P93 of 2017 Annual Report)
The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable United Kingdom law and regulations. Under that law the Directors have prepared Group financial statements in accordance with International Financial Reporting Standards ('IFRS') as adopted by the European Union and the parent company financial statements in accordance with United Kingdom Generally Accepted Accounting Practice.
The Directors are required to prepare financial statements for each financial year which present a true and fair view of the financial position of the Group and Company and the financial performance and cash flows of the Group for that period. In preparing those financial statements on a going concern basis, the Directors are required to:
· select suitable accounting policies and then apply them consistently;
· make judgements and accounting estimates that are reasonable;
· present information, including accounting policies, in a manner that provides relevant, reliable, comparable and understandable information;
· state that the Group has complied with IFRS as adopted by the EU and that the parent company has complied with UK accounting standards, 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 Group and the Company will continue in business.
The Directors are responsible for keeping proper accounting records which disclose with reasonable accuracy at any time, the financial position of the Group and enable them to ensure that the financial statements comply with the Companies Act 2006 and as regards the Group financial statements, Article 4 of the IAS Regulation. 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. They are also 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. We confirm that, to the best of our knowledge:
i. the Group financial statements, prepared in accordance with IFRS as adopted by the EU, give a true and fair view of the assets, liabilities, financial position and result of the Group taken as a whole;
ii. the Strategic Report includes a fair review of the development and performance of the business and the position of the Group, together with a description of the principal risks and uncertainties that it faces; and
iii. 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 Group's performance, business model and strategy.
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