News alert from Benchmark

30 November 2022

Benchmark Holdings plc

("Benchmark", the "Company" or the "Group")

Q4 Results

(3 months ended 30 September 2022)

Strong end to FY22 continuing track record of consistent delivery

In compliance with the terms of the Company's unsecured green bond which requires it to publish quarterly financial information, Benchmark, the aquaculture biotechnology business, announces its unaudited results for the 3 months ended 30 September 2022 (the "period").All Q4FY22 and Q4FY21 figures quoted in this announcement are based on unaudited accounts.

This morning the Company published its full year audited results for the 12 months ended30 September 2022 which can be found onhttps://www.benchmarkplc.com/investors.   

Highlights - strong end to the year 

·     Revenues £42.8m, 15% ahead of the prior year (+6% CER) with growth across all business areas:

o Genetics - revenues 15% above Q4 2021 (+11% CER) driven by higher sales of salmon eggs

o Advanced Nutrition - revenues 10% above the prior year (-6% CER) driven by commercial focus and continued innovation

o Health - revenues +31% above Q4 2021 (+31% CER) driven by increased sales of Ectosan^âVet and CleanTreat^â

·     Adjusted EBITDA of £8.8m, 23% ahead of last year driven by higher sales, operational efficiencies and continued financial discipline

·     Adjusted EBITDA excluding fair value movements from biological assets 57% ahead

·     Refinancing of NOK850m secured bond through the issue of a NOK750m unsecured green bond

·     Post period end, refinancing of $15m RCF with a £20m RCF expiring in June 2025

·     Cash of £35.1m and Liquidity of c £51.1m (cash and available facility) as at 29th November 2022

**  Constant exchange rate (CER) figures derived by retranslating current year figures using previous year's foreign exchange rates

(1) Adjusted EBITDA is EBITDA (earnings before interest, tax, depreciation and amortisation and impairment), before exceptional items including acquisition related expenditure.

(2) Adjusted Operating Profit is operating loss before exceptional items including acquisition related items and amortisation of intangible assets excluding development costs

(3) Net debt is cash and cash equivalents less loans and borrowings

Business Area Summary

**  Constant exchange rate (CER) figures derived by retranslating current year figures using previous year's foreign exchange rates

(1) Adjusted EBITDA is EBITDA (earnings before interest, tax, depreciation and amortisation and impairment), before exceptional items including acquisition related expenditure.

Operational highlights

·     Opening of new salmon egg incubation centre in Iceland

·     Salmon egg capacity in Norway and Iceland sold out

·     Progress in commercialisation of SPR shrimp - client wins in Indonesia and Vietnam

·     Continued positive commercial momentum in Advanced Nutrition and focus on operational optimisation

·     Increased customer use and adoption of Ectosan® Vet and CleanTreat®

Current trading and outlook- good momentumin line with our expectations

·      Good start to the year and positive momentum in the business

·      Diversified business and proactive commercial approach create resilience to ongoing macroeconomic pressures

·      Recently announced change in tax regime for aquaculture producers in Norway expected to have a marginal direct effect

·      Continue to progress towards a dual listing on Euronext Growth Oslo with intention to uplist to the Oslo Børs in H1 2023

Enquiries

About Benchmark 

Benchmark is a market leading aquaculture biotechnology company. Benchmark's mission is to drive sustainability in aquaculture by delivering products and solutions in genetics, advanced nutrition and health which improve yield, growth and animal health and welfare.

Through a global footprint in 26 countries and a broad portfolio of products and solutions, Benchmark addresses many of the major aquaculture species - salmon, shrimp, sea bass and sea bream, and tilapia, in all the major aquaculture regions around the world. Find out more at www.benchmarkplc.com

Management Report

The Group reported a strong Q4, continuing the good performance delivered throughout the year.Group revenues at £42.8m were 15% ahead of the prior year (+6% CER) reflecting good trading across all business areas despite the ongoing macroeconomic challenges and price pressure in some of our end markets.Our three business areas delivered revenue growth, with Advanced Nutrition growing by 10%, Genetics by 15% and Health by 31%. Advanced Nutrition continued to capitalise on its renewed commercial focus, Genetics benefitted from peak demand for its specialist salmon eggs and in Health our growth reflects the increased customer uptake of our sea lice solution Ectosan^âVet and CleanTreat^â.

Operating costs in Q4 2022 were 30% higher at £13.3m (Q4 2021: £10.2m) driven by higher activity levels and a strong dollar in the quarter.  The increase was 21% at constant exchange rates.  R&D expenses were £2.0m, 10% up driven by small increases in Health and Genetics with R&D spend in Advanced Nutrition remaining flat against the prior year.

Adjusted EBITDA from continuing operations for the quarter was £8.8m, 23% ahead of the prior year (Q4FY21: £7.1m) reflecting increased sales, operational leverage and financial discipline. Excluding fair value movements from biological assets, Adjusted EBITDA was £9.6m, 57% ahead of the prior year.

As noted in our full year announcement released today, our net result was impacted by an increased depreciation charge associated with the leases on the vessels for our CleanTreat® operation, and higher finance costs due to a higher interest charge and costs associated with movements of hedging instruments as well as costs associated with the refinancing of our NOK bond.

Advanced Nutrition

Revenues from Advanced Nutrition were £18.9m, up 10% (-6% CER). By product area Artemia sales were up 5%, Diets up 20% and sales from Health products increased by 25% compared to the same period last year.  The gross profit margin grew slightly from 60% to 61%.

Operating costs and R&D totalled £6.8m, up 10% compared to the prior year. Continued cost discipline and operational improvements resulted in an increase in Adjusted EBITDA of 29% (+8% CER) to £4.7m. As a result, the Adjusted EBITDA margin reached 25% (Q4FY21:21%).

Genetics

Genetics performed well in the period with revenues of £18.3m, 15% above the prior year (Q4 2021: £15.9m) driven by higher sales ofsalmoneggs resulting in all of our capacity in our Norway and Iceland facilities being sold out.  Harvest revenues were also higher, and we benefitted from first commercial revenues of our SPR shrimp compared to last year.  The gross profit margin was 55% (Q4FY21: 42%)

Adjusted EBITDA of £5.5m in the period was 65% higher than the prior year (Q4 2021: £3.3m) primarily from higher sales together with cost discipline resulting in operational leverage. Excluding the fair value movements from biological assets Adjusted EBITDA was £6.3m,173% ahead of the prior year (Q4 FY21: £2.3m).  As a result, the Adjusted EBITDA margin excluding biological asset movements was 35% (Q4 FY21: 15%).

By species, salmon delivered an excellent performance benefitting from peak demand for our biosecure, specialist eggs available year round and capacity and quality enhancements from our new incubation centre in Iceland.  In shrimp, wecontinuedto progress in our commercialisation of our recently launched SPR shrimps with client wins in Indonesia and Vietnam. We continue to work on developing our product range to the specific needs of the key shrimp markets.

Health

Health delivered a good performance in Q4, reflecting increased use and adoption of our sea lice solution Ectosan Vet and CleanTreat. Revenues in thequarterwere £5.6m, up 30% reflecting progress in use and adoption of our solution.  Adjusted EBITDA in the period was £0.6m (Q4FY21: £1.1m). This reflects the costs associated with having two CleanTreat® units in operation against one in the same period last year.   Operating costs and R&D were £1.9m in the period (Q4 FY21: £1.5m).  Costs associated with the leases of the vessels for the CleanTreat units amounted to £1.8m.

Finance costs, cashflow and net debt

During the quarter, the existing NOK 850m was refinanced through the issue of an unsecured NOK 750m green bond with a maturity date inSeptember 2025 and is to be listed on the Oslo Stock Exchange.The company also extended and increased its RCF facility from $15m to £20m with maturity in June 2025.

Net finance cost for the quarter of £5.1m was higher than the prior year (Q4 2021: £3.7m).  Movements in the quarter in the fair value of our financial instruments taken out to hedge our external borrowings caused a charge of £5.3m, (Q4 2021: charge of £0.4m).  Interest charges for the period of £5.3m (Q4 2021: £1.9m) included one-off early bond settlement fees of £1.6m and accelerated amortisation of previously deferred borrowing fees of £0.9m following the refinancing of the old bond.  These charges were offset in the quarter by foreign exchange gains of £5.6m (Q4 2021: loss £1.2m) due to movements in exchange rates towards the end of the year.

Positive operating cashflows from strong trading in the quarter, together with repayment of some of the borrowings in the refinancing exercise, left net debt at the quarter end at £73.7m (30 June 2022: £89.1m; 30 Sept 2021: £80.9m). Net debt excluding lease liabilities was £47.5m (30 June 2022: £59.3m; 30 Sept 2021: £56.9m).

Outlook

We have had a good start to the year and there is good momentum in the business. Cost inflation and other macroeconomic pressures will continue to be a feature across the world in 2023 and we are not immune. However, we have a well-diversified, balanced business which creates resilience to challenges in individual markets as well as opportunities. In addition, we will continue to proactively mitigate potential pressure on our business and our margins through pricing, supplier management and operational improvements. The recently announced change in the tax regime for aquaculture producers in Norway is expected to have a marginal direct effect on our business.

Looking further into the future, Benchmark is uniquely positioned in an industry that is structurally growing and driven by multiple megatrends. This creates significant opportunity for growth and increasing returns for shareholders in the near and medium term and for many years to come.

Consolidated Income Statement for the period ended 30 September 2022

1 EBITDA - Earnings before interest, tax, depreciation, amortisation, and impairment

2 Adjusted EBITDA - EBITDA before exceptional items including acquisition related items

Consolidated Statement of Comprehensive Income for the period ended 30 September 2022

The accompanying notes are an integral part of this consolidated financial information.

Consolidated Balance Sheet as at 30 September 2022

The accompanying notes are an integral part of this consolidated financial information.

Consolidated Statement of Changes in Equity for the period ended 30 September 2022

*Other reserves in this statement is an aggregation of capital redemption reserve and foreign exchange reserve.

Consolidated Statement of Cash Flows for the period ended 30 September 2022

Unaudited notes to the quarterly financial statements for the period ended 30 September 2022

1. Basis of preparation

Benchmark Holdings plc (the 'Company') is a company incorporated domiciled in the United Kingdom. These consolidated quarterly financial statements as at and for the three months and year ended 30 September 2022 represents that of the Company and its subsidiaries (together referred to as the 'Group').

These quarterly financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting and should be read in conjunction with the Group's consolidated financial statements as at and for the year ended 30 September 2022. They do not include all the information required for a complete set of IFRS financial statements.  However, selected explanatory notes are included to explain events and transactions that are significant to an understanding of the changes in the Group's financial position and performance since the last annual financial statements.  Statutory accounts for the year ended 30 September 2022 were approved by the Directors on 30 November 2022 and will be deliveredto the Registrar of Companies after the AGM on 16 February 2023. The audit report received on those accounts was (i) unqualified and (ii) did not contain a statement under section 498(2) or (3) of the Companies Act 2006.

Going concern

The Group's business activities, together with the factors likely to affect its future development, performance and position are set out in the Management Report.

As at 30 September 2022 the Group had net assets of £323.3m (30 September 2021: £279.6m), including cash of £36.4m (30 September 2021: £39.5m) as set out in the consolidated balance sheet. The Group made a loss for the year of £30.5m (year ended 30 September 2021: loss £11.6m).

As noted in the Strategic Report, we have seen a year of strong performance following an extended period impacted by COVID-19, with improvements throughout the year in all of our three business areas. The Directors have reviewed forecasts and cash flow projections for a period of at least 12 months including downside sensitivity assumptions in relation to trading performance across the Group to assess the impact on the Group's trading and cash flow forecasts and on the forecast compliance with the covenants included within the Group's financing arrangements.

In the downside analysis performed, the Directors considered severe but plausible scenarios on the Group's trading and cash flow forecasts, firstly in relation to continued roll out of the Ectosan®Vet and CleanTreat offering. Sensitivities considered included modelling slower ramp up of the commercialisation of Ectosan® Vet and CleanTreat® through delayed roll-out of the revised operating model for the service, together with reductions in expected biomass treated and reduced treatment prices. Key downside sensitivities modelled in other areas included assumptions on slower commercialisation of SPR shrimp, slower salmon egg sales growth both in Chile and to land-based farms in Genetics, along with sensitivities on sales price increases and potential supply constraints on CIS artemia in Advanced Nutrition. Mitigating measures within the control of management have been identified should they be required in response to these sensitivities, including reductions in areas of discretionary spend, deferral of capital projects and temporary hold on R&D for non-imminent products.

The year ended with the successful refinancing of its NOK 850 million bond which was due to mature in June 2023 with the issue of a NOK 750 million unsecured green bond maturing in 2025. This was achieved against a backdrop of challenging macroeconomic and market conditions and places the Group in a much stronger position in light of the ongoing market environment. Additionally, following the year end, the USD15m RCF was refinanced with the agreement of a new GBP20m RCF on 21 November 2022 with a maturity of June 2025 maturity. Furthermore, our NOK 216m loan facility (which had NOK 165.6m outstanding at the year end) which was set to mature in October 2023 was combined with our NOK 17.5m overdraft facility into a new loan facility of NOK 179.5m on 1 November 2022, with a new maturity date in a further 5 years no later than 15 January 2028. Following all of these refinancing transactions, the Directors are satisfied there are sufficient facilities in place during the assessment period.

The global economic environment has recently experienced turbulence largely as a result of the conflict in Eastern Europe with supply issues in a number of industries impacted and inflation at high levels. Against this backdrop, the Group shows resilience against these pressures in its forecasts, with financial instruments in place to fix interest rates and with opportunities available to mitigate globally high inflation rates, such that even under all of the above scenario analysis, the Group has sufficient liquidity and resources throughout the period under review whilst still maintaining adequate headroom against the borrowing covenants.

The Directors therefore remain confident that the Group has adequate resources to continue to meet its liabilities as and when they fall due within the period of 12 months from the date of approval of these financial statements. Based on their assessment, the Directors believe it remains appropriate to prepare the financial statements on a going concern basis.

1.     Basis of preparation (continued)

These financial statements have been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and International Financial Reporting Standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union.

The preparation of financial statements in compliance with adopted IFRSs requires the use of certain critical accounting estimates. It also requires Group management to exercise judgement in applying the Group's accounting policies. The areas where significant judgements and estimates have been made in preparing the financial statements and their effect are disclosed in Note 2.

2.     Accounting policies

The accounting policies adopted are consistent with those used in preparing the consolidated financial statements for the financial year ended 30 September 2022.

Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total earnings.

Alternative performance measures ('APMs')

The Directors measure the performance of the Group based on a range of financial measures, including measures not recognised by EU-adopted IFRS. These APMs may not be directly comparable with other companies' APMs, and the Directors do not intend these as a substitute for, or superior to, IFRS measures.

Directors have presented the performance measures Adjusted EBITDA, Adjusted Operating Profit, Adjusted Profit Before Tax and Adjusted EBITDA excluding fair value movement on biological assets because they monitor performance at a consolidated level using these and believe that these measures are relevant to an understanding of the Group's financial performance (see note 10). Furthermore, the Directors also refer to current period results using constant currency, which are derived by retranslating current period results using prior year's foreign exchange rates.

Use of estimates and judgements

The preparation of quarterly financial information requires management to make certain judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual amounts may differ from these estimates.

In preparing these quarterly financial statements the significant judgements made by management in applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those applied to the consolidated financial statements for the year ended 30 September 2022.

3.     Segment information

Operating segments are reported in a manner consistent with the reports made to the chief operating decision maker. It is considered that the role of chief operating decision maker is performed by the Board of Directors.

The Group operates globally and for management purposes is organised into reportable segments based on the following business areas:

·     Genetics -harnesses industry leading salmon breeding technologies combined with state-of-the-art production facilities to provide a range of year-round high genetic merit ova.

·     Advanced Nutrition -manufactures and provides technically advanced nutrition and health products to the global aquaculture industry.

·     Health-the segment provides health products and services to the global aquaculture market.

3.     Segment information (continued)

In order to reconcile the segmental analysis to the consolidated income statement, corporate and inter-segment sales are also shown. Corporate sales represent revenues earned from recharging certain central costs to the operating business areas, together with unallocated central costs.

Measurement of operating segment profit or loss

Inter-segment sales are priced along the same lines as sales to external customers, with an appropriate discount being applied to encourage use of Group resources at a rate acceptable to local tax authorities.  This policy was applied consistently throughout the current and prior period.

Reconciliations of segmental information to IFRS measures

4.     Revenue

The Group's operations and main revenue streams are those described in its financial statements to 30 September 2022. The Group's revenue is derived from contracts with customers.

Disaggregation of revenue

In the following tables, revenue is disaggregated by primary geographical market and by sales of goods and services. The table includes a reconciliation of the disaggregated revenue with the Group's reportable segments (see note 3).

Sale of goods and provision of services

4.     Revenue (continued)

Sale of goods and provision of services (continued)

Primary geographical markets

4.    Revenue (continued)

Primary geographical markets (continued)

5.     Exceptional- restructuring, disposal, and acquisition related items

Items that are material because of their size or nature, non-recurring and whose significance is sufficient to warrant separate disclosure and identification within the consolidated financial statements are referred to as exceptional items. The separate reporting of exceptional items helps to provide an understanding of the Group's underlying performance.

Acquisition-related items are costs incurred in investigating and acquiring new businesses. In 2021 contingent consideration of £850,000 was released in relation to the purchase of Benchmark Genetics (USA) Inc.

Exceptional costs include: £843,000 (2021: £nil) of legal and professional costs in relation to preparing for listing the Group on the Oslo stock exchange, and £276,000 (2021: £480,000) relating to restructuring costs.

Costs in relation to disposals includes a credit of £1,203,000 (2021: £nil) in relation to additional contingent consideration received and receivable from disposals in previous years (£294,000 relating to the disposal of Aquaculture UK on 7 February 2020, and £909,000 relating to the disposal of Improve International Limited and its subsidiaries on 23 June 2020) together with legal fees, lease costs and disposal items (net of proceeds received) totaling £42,000 relating to additional costs and disposals proceeds relating to disposals that occurred in 2020.

6.    Taxation

7.     Loss per share

Basic loss per share is calculated by dividing the loss attributable to ordinary equity holders of the Company by the weighted average number of ordinary shares in issue during the period.

Diluted loss per share is calculated by adjusting the weighted average number of ordinary shares outstanding to assume conversion of all dilutive potential ordinary shares. This is done by calculating the number of shares that could have been acquired at fair value (determined as the average market price of the Company's shares for the period) based on the monetary value of the subscription rights attached to outstanding share options and warrants. The number of shares calculated above is compared with the number of shares that would have been issued assuming the exercise of the share options and warrants.

Therefore, the Company is required to adjust the earnings per share calculation in relation to the share options that are in issue under the Company's share-based incentive schemes, and outstanding warrants. However, as any potential ordinary shares would be anti-dilutive due to losses being made there is no difference between Basic loss per share and Diluted loss per share for any of the periods being reported.

A total of 6,240,304 potential ordinary shares have not been included within the calculation of statutory diluted loss per share for the year (30 September 2021: 4,615,712). These potential ordinary shares could dilute earnings/loss per share in the future.

8.     Loans and borrowings

At 30 September 2022 the fair value of the unsecured floating rate listed green bond of NOK 750m was not materially different to the nominal value and has not been separately disclosed. At 30 September 2021 the fair value of 2023 850m NOK Loan notes was £73,981,000.

On 27 September 2022, the Group successfully issued a new unsecured floating rate listed green bond of NOK 750m. The bond which matures in September 2025, has a coupon of three-month NIBOR + 6.50% p.a. with quarterly interest payments, and is to be listed on the Oslo Stock Exchange. The proceeds were used to repay the NOK 850m floating rate listed bond, originally raised in June 2019.

A USD 15m Revolving Credit Facility ("RCF") has been provided by DNB Bank ASA (50%) and HSBC UK Bank PLC (50%). At 30 September 2022 £4,000,000 was drawn on this facility. The facility was undrawn at 30 September 2021.

8.   Loans and borrowings (continued)

Benchmark Genetics Salten AS (formerly SalmoBreed Salten AS) had the following loans (which are ring-fenced debt without recourse to the remainder of the Group) at 30 September 2022:

-      Term loan with a balance of NOK 165.6m (2021: NOK 180.0m) provided by Nordea Bank Norge Abp. The loan is a five-year term loan ending November 2023 at an interest rate of 2.5% above three-month NIBOR.

-      NOK 20.0m 12-month working capital facility provided by Nordea Bank Norge Abp. This was undrawn at 30 September 2022 (2021: undrawn).

-      An additional NOK 17.5m overdraft facility was provided by Nordea Bank Norge Abp during the year with maturity in December 2022. This facility was undrawn at 30 September 2022.

-      Term loan with a balance of NOK 40.1m (2021: NOK 44.7m) provided by Innovasjon Norge. The loan is a 12-and-a-half-year term loan maturing in March 2031. The interest rate on this loan at 30 September 2022 was 4.95%. The interest rate on this loan is variable.

-      NOK 21.75m loan provided by Salten Aqua ASA (the minority shareholder). The loan attracts interest at 2.5% above three-month NIBOR and is repayable on maturity of the Nordea term loan above.

Subsequent to the year end on 1 November 2022, the Nordea Bank term loan above was refinanced together with an existing undrawn overdraft facility into a new loan facility of NOK 179.5m with a new maturity date in a further five years no later than 15 January 2028. Other terms remain the same.

Furthermore on 21 November 2022, the Group refinanced the USD15m RCF with a secured GBP20m RCF provided by DNB Bank ASA, maturing on 27 June 2025. The margin on this facility is a minimum of 2.75% and a maximum of 3.25%, dependent upon the leverage of the Group above the relevant risk free reference or IBOR rates depending on which currency is drawn.

The lease liabilities are secured on the assets to which they relate.

9.    Share capital and additional paid-in share capital

During the year ended 30 September 2022, the Group issued a total 184,694 ordinary shares of 0.1p each to certain employees of the Group relating to share options of which 12,509 were exercised at a price of 0.1 pence, and 172,185 were exercised at a price of 42.5p.

On 29 November 2021, the Company issued 33,401,620 new ordinary shares of 0.1 pence each by way of a placing and subscriptions at an issue price of 62.0 pence per share. Gross proceeds of £20.7m were received for the placing and subscription shares. Non-recurring costs of £0.6m were in relation to the share issues and this has been charged to the share premium account (presented within Additional paid-in share capital).

During the year ended 30 September 2021, the Group issued a total of 2,152,600 ordinary shares of 0.1p each to certain employees of the Group relating to share options, of which 426,182 were exercised at a price of 0.1 pence, 1,626,436 were exercised at a price of 42.5 pence and 99,982 were exercised at a price of 58.5 pence.

During the prior year, contingent consideration totalling USD 450,000 (£333,000) became payable following the acquisition of aquaculture breeding programmes centred on shrimp from Centro de Investigación de la Acuicultura de Colombia Ceniacua on 11 August 2016. At the Group's discretion, the contingent consideration was paid in ordinary shares in the Group and the Group therefore issued 536,272 ordinary shares of 0.1p each on 13 January 2021 to settle this liability.

10.   Alternative performance measures and other metrics

Management has presented the performance measures EBITDA, Adjusted EBITDA,Adjusted EBITDA before fair value movement in biological assets,Adjusted Operating Profit and Adjusted Profit Before Tax because it monitors performance at a consolidated level using these and believes that these measures are relevant to an understanding of the Group's financial performance.

Adjusted EBITDA which reflects underlying profitability, is earnings before interest, tax, depreciation, amortisation, impairment, and exceptional items including acquisition related items and is shown on the Income Statement.

Adjusted EBITDA before fair value movements in biological assets, which is Adjusted EBITDA before the non-cash fair value movements in biological assets arising from their revaluation in line with International Accounting Standards.

Adjusted Operating Profit is operating loss before exceptional items including acquisition related items and amortisation and impairment of intangible assets excluding development costs as reconciled below.

Adjusted Profit Before Tax is earnings before tax, amortisation and impairment of intangibles assets excluding development costs, and exceptional items including acquisition related items as reconciled below. These measures are not defined performance measures in IFRS. The Group's definition of these measures may not be comparable with similarly titled performance measures and disclosures by other entities.

Reconciliation of Adjusted Operating Profit to Operating Loss

Reconciliation of Loss Before Taxation to Adjusted Profit Before Tax

10.  Alternative performance measures and other metrics (continued)

Other Metrics

Liquidity

A key financial covenant is a minimum liquidity of £10m, defined ascash plus undrawn facilities.

The undrawn bank facility relates to the RCF facility.  At 30 September 2022, £4,000,000 (2021: £nil) of the RCF was drawn, leaving £9.4m undrawn (2021: £11.1m).

11.   Net debt

Net debt is cash and cash equivalents less loans and borrowings.

==