Hill & Smith Holdings PLC (the "Company")

2010 Annual Report and Accounts and Notice of 2011 Annual General Meeting ("AGM")

 

Hill & Smith Holdings PLC has today posted, or otherwise notified as being available on its website www.hsholdings.com, the following documents:

 

1.   2010 Annual Report and Accounts

2.   Notice of 2011 AGM

 

In accordance with Listing Rule 9.6.1 a copy of each of these documents has been uploaded to the National Storage Mechanism and will be available for viewing shortly.

 

A hard copy of the 2010 Annual Report can be obtained upon request to the Company Secretary, Hill & Smith Holdings PLC, Westhaven House, Arleston Way, Shirley, Solihull, B90 4LH.

 

The statutory accounts for the year ended 31 December 2010 have been approved by the Board and will be delivered to the Registrar of Companies following the Company's AGM. 

 

Compliance with Disclosure and Transparency Rule 6.3.5 ("DTR 6.3.5") - Extracts from the 2010 Annual Report

 

The information below, headed as Appendix A, B and C, and which is extracted from the 2010 Annual Report, is included solely for the purpose of complying with DTR 6.3.5 and the requirements it imposes on how to make public Annual Financial Reports.  It should be read in conjunction with the Company's Preliminary Announcement issued on 9 March 2011 (available at www.hsholdings.com).  Together these constitute the material required by DTR 6.3.5 to be communicated to the media in unedited full text through a Regulatory Information Service.  This material is not a substitute for reading the full 2010 Annual Report.  All page numbers and cross-references in the extracted information below refer to page numbers in the 2010 Annual Report.

 

Appendix A - Risk Factors

 

Market customer related

The impact of a general economic downturn that leads to a reduction in customer demand and production volumes.

The Group derives part of its revenue from Government spending on infrastructure projects such as road and rail and any timing, funding or policy issues can have an adverse impact on key areas of the business.

 

Mitigation

Forward looking indicators are regularly reviewed to identify deteriorating market conditions.  The cost base is reduced as required and there is a management structure in place to enable a rapid response to changing circumstances.

We have a diversified portfolio of products and services to various markets and maintain a key account management programme for major customers on a global basis. In addition we continue to increase our capabilities to service customers in emerging markets.

 

Commercial relationships

The Group benefits from close commercial relationships with a number of long standing key customers and suppliers. The loss of any of these or a significant worsening of commercial terms could have an impact on the Group's reported results.

 

 

Mitigation

The Group ensures sufficient resource is devoted to maintaining the close working relationships we have with customers and suppliers.

 

Product failure

Many of the Group's products are supplied to the public sector for the benefit of members of the public.  To the extent that any of the Group's products fail, this could generate adverse publicity and have a significant effect on the Group's reputation, its financial position and its ability to win new business.

 

Mitigation

Where appropriate, accreditation, regulatory approval and testing are undertaken to reach required compliance levels.

Comprehensive quality control procedures are backed up by an appropriate level of insurance cover through a major insurer.

 

Environmental and safety risks

Changes in legislation and standards, or the Group's failure to adequately control environmental risks, may have an adverse effect on the Group.  A serious failure on the part of the Group to adequately control its health and safety risks could have an adverse impact on its operations, reputation and financial performance.

 

Mitigation

Operational management work within the policies and processes laid down by the Group. Where appropriate outside specialist expertise is engaged and recommendations and improvements monitored for implementation as necessary.  Although we believe that our operations are in compliance with current regulations, we cannot eliminate the risk of all accidents or non-compliance.

 

Pensions

Factors outside the Company's control, such as mortality rates, interest and inflation rates andinvestment performance, may lead to an increase in the deficit and Company contributions.

 

Mitigation

The Group liaises regularly with the Trustees on all aspects, including assessment of the risks factors, appropriate mitigating actions and investment performance of the assets.

 

Human resources

Future success will depend, to a large degree, on the ability of the Group to attract and retain skilled and qualified personnel.

 

Mitigation

Policies and processes are reviewed and maintained to manage the risks relating to our employees. As part of these policies the Group seeks to offer competitive rates of pay and review salaries annually. Benchmarking of pay rates is undertaken along with performance appraisals and training programmes.

 

Acquisitions

The Group is an active acquirer.  Acquisitions can involve risks that might have a material impact on the Group's financial performance and reputation.

 

Mitigation

Comprehensive due diligence is carried out prior to the completion of an acquisition and, where practical, representations, warranties and indemnities are obtained from vendors. A post acquisition review of the integration and performance is undertaken.

Business conduct risks

The Group operates in a number of different territories and a potential breach in the area of ethical behaviour could impact the Group's reputation or image.

 

Mitigation

Our reputation with our stakeholders is fundamental to the continued success of the Group and we mitigate reputational risks through various means, including:

-     Our Code of Business Ethics and Whistleblowing Policy.

-     Our systems of internal control and risk management.

The Group's Code of Business Ethics and Anti-Corruption Policy are further described in the Corporate Social Responsibility section of this Report.

 

Financial risks

The Group is exposed to a number of financial risks including credit risk, liquidity risk and market risks.

 

Mitigation

Financial risks are managed at a Group level and a fuller description and explanation of how they are managed is described in Note 19 and on pages 67 to 72 of the Financial Statements contained in this Report.

 

Appendix B - Directors Responsibilities Statement pursuant to Disclosure and Transparency Rule 4

 

The following statement is extracted from page 42 of the 2010 Annual Report and is repeated here for the purposes of compliance with DTR 6.3.5.  This statement relates solely to the 2010 Annual Report and is not connected to the extracted information set out in this announcement or the Preliminary Announcement.

 

We confirm that to the best of our knowledge:

 

·     the Group and Parent Company Financial Statements in the Annual Report, which have been prepared in accordance with applicable UK law and with the applicable set of accounting standards, give a true and fair view of the assets, liabilities, financial position and profit or loss of the Company and Group as a whole;

·     the management report (which comprises the Directors' Report and the Business Review) includes a fair review of the development and performance of the business and the position of the Company and Group as a whole, together with a description of the principal risks and uncertainties that they face.

 

Appendix C - Related Party Transactions

 

The key management are considered to be the Board of Directors of Hill & Smith Holdings PLC, whose remuneration can be seen in the Directors' Remuneration Report on pages 35 to 41 and in the Related party details (Note 24) on page 81 of the 2010 Annual Report

 

 

 

 

John Humphreys

Company Secretary

Hill & Smith Holdings PLC

 

1 April 2011