Page 203 - Sigmaroc Annual-Report 2023

Goijens will continue to prepare their company financial statements in line with the Belgian GAAP rules.
Nordkalk entities use local GAAP rules to prepare and report their financial statements. The Group reports using UK IAS standards and in order to comply with the Group’s reporting standards, management of Nordkalk processed several adjustments to ensure the financial information included at a Group level complies with UK IAS. Nordkalk will continue to prepare their company financial statements in line with the local GAAP rules.
The Group recognises any non-controlling interest at the non-controlling interest’s proportionate share of the recognised amounts of acquiree’s identifiable net assets.
b) Associates
Associates are entities over which the Group has significant influence but not control over the financial and operating policies. Investments in associates are accounted for using the equity method of accounting and are initially recognised at cost. The Group’s share of its associates’ post-acquisition profits or losses is recognised in profit or loss, and its share of post-acquisition movements in reserves is recognised in other comprehensive income. The cumulative post- acquisition movements are adjusted against the carrying amount of the investment.
Accounting policies of equity–accounted investees have been changed where necessary to ensure consistency with the policies adopted by the Group.
c) Joint Arrangement
A joint arrangement is an arrangement in which two or more parties have joint control. A joint venture is a joint arrangement in which the parties that share joint control have rights to the net assets of the arrangement. Joint arrangements are accounted for using the equity method of accounting and are initially recognised at cost. The Group’s share of its associates’ post-acquisition profits or losses is recognised in profit or loss.
d) Employee Benefit Trust
Where considered appropriate, adjustments are made to the financial information of subsidiaries to bring the accounting policies used into line with those used by other members of the Group. All intercompany transactions and balances between Group enterprises are eliminated on consolidation.
The Employee Benefit Trust is considered to be a special purpose entity in which the substance of the relationship is that of control by the Group in order that the Group may benefit from its control. The assets held by the trust are consolidated into the Group.
2.3. Going Concern
The Financial Statements have been prepared on a going concern basis which the directors consider to be appropriate for the following reasons.
The Group meets its day-to-day working capital and other funding requirements through operating cash generation and its Debt Facilities. The Debt Facilities comprise of a €600 million committed term facility, €150 million revolving credit facility and a further €100 million uncommitted accordion which matures on 21 November 2028. The Group has met all covenants on its Debt Facilities.
The Group has prepared cash flow forecasts for a period of more than 12 months which anticipate a continuous upward trend of profitability and cash generation. As the Group has
a strong focus on operational gearing, it can remain flexible during economically disruptive events which can have a negative effect on cash flow.
At 31 December 2023, the Group had cash of £55.9 million (2022: £68.6 million) and undrawn banking facilities under the legacy debt of £173 million (2022: £173 million), and at the date of this report has similar levels of liquidity which is expected to provide sufficient funds for the Group to discharge its liabilities as and when they fall due and ensure covenants are met.
Based on the above, the directors believe that it remains appropriate to prepare the financial statements on a Going Concern basis.
2.4. Segment Reporting
Operating segments are reported in a manner consistent with the internal reporting provided to the chief operating decision-maker. The chief operating decision-maker, who is responsible for allocating resources and assessing performance of the operating segments, has been identified as the Board of Directors that makes strategic decisions.
2.5. Foreign Currencies
e) Functional and Presentation Currency
Items included in the Financial Statements are measured using the currency of the primary economic environment in which the entity operates (the ‘functional currency’). The Financial Statements are presented in Pounds Sterling, rounded to the nearest £000’s, which is the Company’s functional currency.
f) Transactions and Balances
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of the transactions or valuation where such items are re-measured. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at year-end exchange rates of monetary assets and liabilities denominated in foreign currencies are recognised in the Income Statement. Foreign exchange gains and losses that relate to borrowings and cash and cash equivalents are presented in the Income Statement within ‘finance income or costs’. An exception to this is when the borrowings exchange differences arise on monetary items that form part of the reporting entity’s net investment in a foreign operation, in the consolidated financial statements the exchange gain or loss will be shown in other comprehensive income. All other foreign exchange gains and losses are presented in the Income Statement within ‘Other net gains/(losses)’.
Translation differences on non-monetary financial assets and liabilities such as equities held at fair value through profit or loss are recognised in profit or loss as part of the fair value gain or loss. Translation differences on non- monetary financial assets measured at fair value, such as equities classified as available for sale, are included in other comprehensive income.
g) Group companies
The results and financial position of all the Group entities (none of which has the currency of a hyperinflationary economy) that have a functional currency different from the presentation currency are translated into the presentation currency as follows:
• assets and liabilities for each period end date presented are translated at the period-end closing rate;
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