Aim Rule 26
The information contained within this section of the website is for the purposes of AIM Rule 26 updated 29 February 2024:
Next announcement
The results for the year to 31 May 2024 will be released in September 2024.
Business Description
Leeds Group plc has been established for more than a century and is incorporated in England and Wales under Company Number 67863. Its principal country of operation is Germany. For most of its history, the Group has been mainly engaged in textile processing, specialising in fabric printing and yarn dyeing, and by 1996 had manufacturing operations in UK, Holland and Italy. In recent years, the European textile manufacturing industry has contracted, with an ever-increasing proportion of European textile consumption being sourced from the low wage economies of the Far East. In response, Leeds Group has ceased all manufacturing activities.
It is now regarded as a cash shell, owning a property in Germany which is rented out to its former subsidiary.
Country of Incorporation and Operations
Country of incorporation : England and Wales
Company registration number : 67863
Main country of operation : Rental of property in Germany
Current Constitutional Documents
The Company’s Memorandum and Articles can be found here.
Details of any other exchanges or trading platforms
The securities of the Company are traded on the AIM market operated by the London Stock Exchange plc. Its shares have not been admitted, nor have any applications been made, for any of its shares to be admitted or traded on any other exchanges or trading platform.
AIM Securities Information
This information was last updated on 3 April 2024.
AIM securities in issue: 27,320,843 ordinary shares of 25 pence each. The percentage of shares held in public hands was 35.27%.
The identity and shareholdings of the Company’s significant shareholders can be found here.
Details of Restrictions on the Transfer of Securities
There are no restrictions on the transfer of ordinary shares.
Company Documents
All Company Documents including Annual Accounts and Notifications can be found here.
Corporate Governance
The Directors have adopted the Quoted Companies Alliance Corporate Governance Code for small and mid-sized Quoted Companies as from 28 September 2018.
Chairman’s Corporate Governance Statement
As Chairman of the Board my role is to develop the strategy for the company together with the Board of Directors, monitor the ongoing performance of the companies within the Group to ensure that they are meeting our requirements and also identify potential acquisitions targets.
In addition, my role also encompasses overseeing the functioning of the Board and its effectiveness, also to ensure sound corporate governance practices are followed.
All the Directors believe strongly in the importance of good corporate governance for the creation of shareholder value over the medium to long term and to engender trust and support amongst the Group’s wider stakeholders.
In accordance with the changes to AIM Rule 26 the Company is now applying the revised Quoted Companies Alliance (‘QCA’) Corporate Governance Code (‘QCA Code’) published earlier in 2018.
I work with key executives throughout the organisation to instil good corporate governance practices in accordance with the QCA Code.
The Board monitors our corporate governance practices and will always implement improvements which further enhance performance and/or benefit stakeholders. The report is updated every year and was last updated 23 October 2023 and will need to be updated to reflect the sale of its subsidiary.
Jan G Holmstrom, Executive Chairman
The Company has complied with the Code as follows:
| Principle | Application | |
| 1 | Establish a strategy and business model which promotes long-term value for shareholders | The Company’s strategy is shaped by the Board and is set out in the 2023 Annual Report and also on the ‘About Leeds Group PLC’ website page. The company’s shares are traded on the AIM market of the London Stock Exchange. Leeds Group PLC is a textiles business which designs, sources and sells fabric. It sources mainly from the Far East and sells mainly to the European market through wholesale markets. In order to service these markets the Group has invested significantly in recent years in warehousing and distribution facilities and into double folding plant and machinery so as to provide a complete, rapid response, in-house service. The Board believes that these investments promote long term value for shareholders. The Strategic Report as presented by the Directors and as contained in the Annual Report 2023, further explains the Company’s business model and strategy. The Report also includes the key performance indicators used by the Board to monitor business performance and the risks and uncertainties facing the business and how these are addressed. |
| 2 | Seek to understand and meet shareholder needs and expectations | The Board is committed to communicating openly with shareholders to ensure that its strategy and performance are clearly understood. The Board communicates with shareholders through the Annual Report and the Interim Statement, trading and other announcement made on RNS and at the Annual General Meeting (‘AGM’) where the Board encourages investors to participate. The Company also maintains a website https://www.leedsgroup.plc.uk which contains information on the Group’s business, corporate information and specific disclosures required under AIM Rules and the QCA Code. In this way the Directors have developed a good understanding of the needs and expectations of all elements of the Company’s shareholder base. There have been no significant votes against resolutions at previous AGMs. As the companies within the Group expand, we continually review the risks and uncertainties facing the Group to ensure we identify any new key risks and how we implement appropriate action to manage these risks. |
| 3 | Take into account wider stakeholder and social responsibilities and their implications for long term-success | The Board recognises its responsibility under UK law to promote the success of the Group for the benefit of its stakeholders and understands that the business has a responsibility towards its stakeholders including shareholders, employees, customers, suppliers, regulators and to the local community. The Board sets standards across the Group and monitors these at regular Board meetings. The Board is very conscious that the tone and culture it sets impacts all aspects of the Group and the way employees behave and operate. The Board encourages open dialogue and commitment to providing the best service possible to the Group’s customers and considerate interactions with suppliers. The Company monitors feedback from all of its stakeholders as reported by the Group companies and the Board uses this to develop future policy. Being a participant in the textile industry, the Board is keenly aware of environmental and labour considerations and is actively working to ensure that it is at the forefront of meeting the standard expected over the coming years. |
| 4 | Embed effective risk management, considering both opportunities and threats, throughout the organisation | The Board has an active program of working with all the Group companies to assist with achieving goals and to discuss and resolve any issues that arise. The Board is responsible for the Group’s system of internal controls and for reviewing its effectiveness. The system is designed to manage, rather than eliminate, the risk of failure to achieve the Group’s strategic objectives and can only provide reasonable but not absolute assurance against material misstatement or loss. The Board monitors financial controls through the setting and approval of annual budgets throughout the Group and the regular review of monthly management accounts which are produced within three weeks of the month end. Each Group company has defined authorisation levels for expenditure, the placing of orders and signing authorities. The daily cash movements of the Group companies are reconciled and monitored by their finance departments. The Group’s cash flow is monitored by the Board. Each year on behalf of the Board, the Company Secretary attends audit review meetings at which the auditors present their findings including a comprehensive review of risks/potential risks which cover both financial and non-financial issues potentially affecting a Group company. Group Board meetings are held in Germany at least twice a year which include a meeting with the senior management team and Directors of Hemmers Itex. |
| 5 | Maintain the Board as a well-functioning, balanced team led by the chair | The purpose of the Board is to ensure that the business is managed for the long-term benefit of all shareholders, whilst at the same time having regard for all stakeholders. The Board has a formal schedule of matters reserved for its decisions as set out in Principle 10 below. There are at least four full Board meetings spread across each year which tie in as far as possible with the Group’s financial reporting calendar. At least two meetings will be based at Hemmers Itex. Additional meetings are held as required. The full Board is responsible and accountable to the shareholders for the management and success of the Group and to provide effective controls to assess and manage risks in the Company. The Board currently comprises the Executive Chairman and two Non-Executive Directors, one of whom is an independent non-executive director. The Directors are considered to be independent of the management. However, the Executive Chairman and one of the other Non-Executive Director are representatives of significant shareholders and so do not meet the definition of Independent Directors. Each is aware of his statutory responsibilities to act in the interests of all shareholders and they consider their interests to be aligned to promote the long term success of the company. Thus, the Board only has one Independent Non-Executive Director rather than two as recommended by the QCA code. The Directors believe that the current Board structure has the necessary range of skills, objectivity and diversity to manage what is a simple structure business and that to increase the number of Independent Non-Executive Directors would add cost rather than benefit. The Directors of Hemmers Itex are invited to join Board meetings to report on the operations of the subsidiary. The Board continually keeps this position under review and has identified triggers that it believes would lead to additional appointments. These include proposed diversification into new business areas; a significant acquisition; significant organic growth into new territories. The Board has established procedures to identify and monitor potential or actual conflicts of interest. The Board is supported by the Audit, Remuneration and Nominations Committees, each of which has access to information, resources and advice that it deems necessary, at the Company’s cost, to enable the committee to discharge its duties. The Committees’ Terms on Reference are posted on the AIM rule 26 page of Company’s website. The Audit Committee is comprised of all the Directors and is chaired by the independent Non-Executive Director. The Group Company Secretary/Finance Manager attends the meetings by invitation. The Audit Committee meets at least twice a year and is responsible for ensuring that the financial performance of the Group is properly reported and monitored and for meeting the auditors and reviewing the reports from the auditors relating to accounts and internal control systems. The external auditors will attend all meetings.The Remuneration Committee comprises the Directors and is chaired by the Chairman. The Remuneration Committee reviews and if appropriate sanctions remuneration proposals made by the Directors of Hemmers Itex.No director is permitted to participate in discussions or decisions concerning his own remuneration. The Remuneration Committee meets as and when necessary.The Nominations Committee comprises all members of the Board and is chaired by the Chairman. The Nomination Committee reviews and, if appropriate, approves recommendations for the appointment of additional Directors or replacement of current Directors and for succession planning for the Company.The Board and its Committees receive appropriate and timely information and minutes are kept of all relevant committee meeting matters.Any Director can challenge proposals with decisions being taken after discussion. Any director can ask for a concern to be formally noted. Specific actions arising from meetings are agreed by the Board or relevant committee and then followed up by management.Directors have access to advice or services needed to enable them to carry out their roles and duties.
In 2022/23, there were nine internet Board meetings and one other Board meetings In 2022/23 all Directors attended the two audit committee All Directors are subject to reappointment by shareholders at the first Annual General Meeting following their appointment and thereafter by rotation. The Directors spend such time as is necessary to ensure that their roles and duties are carried out effectively. |
| 6 | Ensure that between them the Directors have the necessary up-to-date experience, skills and capabilities | The skills and experience of the Board are set out in their biographical details included within the Directors’ Report of the Company’s Annual Report. The experience and knowledge of each of the Directors gives them the ability to constructively challenge strategy and to scrutinise performance. The Board comprises Directors with a range of different skills including business and financial experience, IT experience and corporate finance experience. All the Directors have considerable experience within the textile and leather industry and therefore are well placed to offer challenge to the Senior management and Directors of Hemmers Itex. In addition, the Company’s Directors have held senior executive positions for a number of years in UK plc companies and therefore are fully aware of their corporate responsibilities and the need to ensure compliance with the AIM regulatory requirements. The Directors of the Company and their responsibilities on the Board are:Role of the Executive Chairman – Jan Holmstrom: The Non-Executive Chairman has overall responsibility for corporate governance and in promoting high standards throughout the Company. As well as leading and chairing the Board, the Non-Executive Chairman’s responsibilities are:-
Jan Holmstrom has held a number of positions as Chairman of private and plc companies and has considerable textile and corporate finance experience. Role of the Group Finance Manager and Company Secretary – Dawn Henderson: The roles of Group Finance Manager and Company Secretary are combined. The Board acknowledges the QCA guidelines on this matter and consider the joint roles appropriate for the Company’s size. The Group Finance Manager is responsible for providing financial oversight of the Group, preparing the accounts, monitoring the performance of the Group companies and reporting on financial matters to the Board. Providing financial input on acquisitions. The Company Secretary is responsible for providing clear and timely information flow to the Board and its Committees and supports the Board on matters of corporate governance and risk. The Company Secretary has direct access to the Chairman on matters of Corporate Governance. Dawn Henderson is a qualified Chartered Accountant who qualified with KPMG in 1988. She has held various Finance Director and Company Secretary roles both within the private and plc environment. Role of the Independent Non-Executive Director – David Cooper: The role of the Independent Non-Executive Director is to contribute independent thinking and judgement through the application of their external experience and knowledge, scrutinise the performance of the management of Hemmers, provide constructive challenge and ensure that the Company is operating within the governance and risk framework approved by the Board. David Cooper is a qualified Chartered Accountant with considerable corporate and accounting experience and has also worked in the textile industry for many years. Role of the Non-Executive Director – Johan Claesson: The role of the Non-Executive Director is to scrutinise the performance of the management of Hemmers, provide constructive challenge and ensure that the Company is operating within the governance and risk framework approved by the Board. Johan Claesson has held a number of positions as Non-Executive Director of private and plc companies and has also worked in the textile industry for many years. He also has considerable experience in the IT and property. Each director is responsible for maintaining the level of skill set required by the role and this is achieved by continuing professional education, technical updates from professional bodies and advisors and an active role assisting the existing Group companies. Whenever required the Directors seek legal, regulatory and audit advice from external advisors. The Board as a whole is well placed to implement the Company’s strategy. |
| 7 | Evaluate Board performance based on clear and relevant objectives, seeking continuous improvement | There is no formal performance evaluation process in place currently. The Directors will consider what performance evaluation framework is required for the Group. Responsibility for succession planning lies with the Nomination Committee. The Committee is satisfied that the Board has the skills it presently requires. The Board has considered the critical functions within each of the businesses to ensure adequate cover exists for each position which would enable contingency and succession to be managed in an appropriate timescale. |
| 8 | Promote a corporate culture that is based on ethical values and behaviours. | The Board recognises that its decisions will impact the corporate culture of the Group as a whole and that this will affect the performance of the business. The Board is also very conscious that the tone and culture that it sets will greatly impact all aspects of the Group and the way employees behave and operate. The importance of sound ethical values and behaviours is crucial to the ability of the Group to successfully achieve its corporate objectives. Senior management regularly visit group companies and employees are invited to other group company offices. The Board has regular interaction with Group company employees and monitors corporate culture in this way. Additionally, it ensures its sound ethical practices and behaviours are deployed at Group company meetings. |
| 9 | Maintain Governance structures and processes that are fit for purpose and support good decision making by the Board | The roles and responsibilities of each Director are set out in the response to Principle 6. The terms of reference of the Board committees are set out in response to Principle 5. There are a wide range of matters reserved for the Board. These include strategy, finance, corporate governance, approval of significant capital expenditure, appointment of key personnel and compliance with legal and regulatory requirements. The Company’s governance framework is reviewed to maintain the highest levels of business performance. |
| 10 | Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders | The Board recognises that meaningful engagement with its shareholders is integral to the continued success of the Group. The Board are kept informed of the views of the shareholders through reports from the Company Secretary. The Board believes that the Annual Report, and the Interim Report published at the half‑year, play an important part in presenting all shareholders with an assessment of the Group’s position and prospects. All reports and press releases are published on the Group’s website. The Annual General Meeting is the principal opportunity for private shareholders to meet and discuss the Group’s business with the Directors. There is an open question and answer session during which shareholders may ask questions both about the resolutions being proposed and the business in general. The Directors are also available after the meeting for an informal discussion with shareholders. The Committees of the Board have not published committee reports . They will consider whether to do so in the future. The Board is supported by the Audit and Remuneration Committees, each of which has access to information, resources and advice that it deems necessary, at the company’s cost, to enable the Committee to discharge its duties. These duties are set out in the Terms of Reference which are available on the website.The Audit CommitteeThe Audit Committee has met with the external auditors during the course of the year to monitor progress and discuss any issues arising.The Remuneration CommitteeThe Remuneration Committee reviews and determines on behalf of the Board and shareholders of the Company the pay, benefits and other terms of service of the Directors of the Company and the broad pay strategy with respect to the Hemmers management.Remuneration Policy
The objective of the Company’s remuneration policy is to develop remuneration packages which motivate Directors and support the business objectives in the short, medium and long term; to align the interests of Directors with the interests of long term shareholders; encourage executives to operate within the risk parameters set by the Board and ensure that the company can recruit and retain high quality executives through packages which are fair and attractive but not excessive. Matters reserved for the Board Management structure and appointments
Strategic/Policy considerations
Transactions
i. Pension funding ii. Contracts in excess of one year’s duration iii. Giving securities over significant Company assets (including mortgages and charges over the Company’s property)
4. Finance
General
Notices of all general meetings for the past 5 years are contained within the Annual Accounts. These are included here. There have been no significant votes against any resolution proposed at a general meeting in the past 5 years. Significant means more than 20% of those who voted, voting against a resolution. |
Directors
Jan G Holmstrom (Executive Chairman)
Jan has worked in the financial services sector during his entire career and has a wealth of experience working internationally e.g. in the UK, Hong Kong and Sweden. Jan is Non-Executive Chairman of Johnson and Starley Limited, Combat Heating Solutions Limited, Dravo Limited and a Non-Executive Director of International Fibres Group (Holdings) Limited, UIM Property Limited and Browallia Holdings Limited. Jan joined the Board of Leeds Group in November 2011 and was appointed Chairman in October 2014.
Johan Claesson (Non-Executive Director)
Johan has been a major shareholder in Leeds Group since 1999, and has extensive business interests, both private and in the public arena. Johan is Chairman of Catella AB, a public listed company and Chairman of Claesson & Anderzén, a private property company. Johan joined the Board of Leeds Group in September 2004.
David Cooper (Independent Non-Executive Director)
David is a chartered accountant and member of the Institute of Chartered Accountants of Scotland. Previously David was Group Finance Director and Company Secretary of AIM-listed Dawson International PLC, gaining over 25 years’ experience in the global textiles industry. He is now Finance Manager and Company Secretary of Xelect Limited which supplies genetic consultancy services to the aquaculture sector. David joined the Board of Leeds Group in October 2014. David remains an independent director as he has no business relationship with any other directors or shareholders in Leeds Group.
The Board
The Board of Leeds Group consists of three non-executive directors and its principal responsibilities are to:
- Agree strategy and performance objectives with the management of the Group’s subsidiaries
- Regularly monitor performance against agreed objectives
- Identify investment opportunities as part of the Group’s longer term growth plans.
The Board recognises its responsibility for the proper management of the Company and is committed to maintaining a high standard of corporate governance. The Directors recognise the importance of sound corporate governance commensurate with the size and nature of the Company and the interests of its Shareholders.
The Board meets regularly to consider strategy, performance, corporate governance and the framework of internal controls. To enable the Board to discharge its duties, all Directors receive appropriate and timely information.
The senior management of Hemmers are invited to attend Board meetings to update the Board on the finance and operations of Hemmers Itex.
Any necessary briefing papers are distributed to all Directors in advance of the Board meetings.
Procedures are in place to enable the Directors to obtain independent professional advice in the furtherance of their duties, if necessary, at the Company’s expense.
The Audit Committee
The audit committee comprises the three Directors of the Company, and is chaired by the Group’s independent non-executive Director, Mr David Cooper. The audit committee meets not less than twice a year, and receives and reviews reports from the Company’s auditors relating to the annual accounts and to the internal control procedures in use throughout the Group. It is responsible for ensuring that the financial performance of the Group is properly reported with particular regard to legal requirements, accounting standards and the AIM Rules for Companies.
The terms of the Audit Committee can be found here.
The Remuneration Committee
The remuneration committee comprises the three Directors of the Company. It meets not less than once a year. It is responsible for determining and reviewing the terms and conditions of service (including remuneration) of the senior management of the trading subsidiary, Hemmers Itex.
The terms of the Remuneration Committee can be found here.
UK City Code on Takeovers and Mergers
The UK City Code on Takeovers and Mergers applies to the Company.
Advisor Information
The Company’s Advisors are as follows:
Nominated Adviser and Broker
Cairn Financial Advisers LLP
Ninth Floor, Cheyne House
107 Cheapside
London
EC2V 6DN
Solicitors
Walker Morris
33 Wellington Street
Leeds
LS1 4DL
Registrars
Link Group
Central Square
29 Wellington Street
Leeds
LS1 4DL
Tel: 0871 664 0300
Calls to the Link Group shareholder helpline are charged at the standard geographic rate and will vary by provider. Calls outside the United Kingdom will be charged at the applicable international rate. Lines are open between 09:00 – 17:30, Monday to Friday excluding public holidays in England and Wales.
Email shareholderenquiries@linkgroup.co.uk
Auditor
MHA
Sixth Floor, 2 London Wall Place
London
EC2Y 5AU
Principal Bankers
Lloyds Bank
1 Lovell Park Road
Leeds
LS1 1NS
Registered Office
Craven House
14-18 York Road
Wetherby
Leeds
LS22 6SL