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BCA Marketplace plcAnnual Report and Accounts 2017

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nnual Report and Accounts 2017

Keeping the marketplace moving

Strategic report P0101 Business highlights02 Executive Chairman’s statement04 Market overview10 BCA Marketplace16 Strategy18 Business model34 Operating review39 Risk management42 Corporate responsibility

Governance P4444 Board of Directors46 Executive Chairman’s governance

statement47 Governance report49 Audit & Risk Committee report51 Nomination Committee report52 Remuneration Committee report61 Directors’ report64 Independent auditor’s report

Financials P6666 Consolidated income statement67 Consolidated statement of

comprehensive income68 Consolidated statement of

changes in equity69 Consolidated balance sheet70 Consolidated cash flow statement71 Notes to the consolidated financial

statements108 Company balance sheet109 Company statement of changes in equity110 Company cash flow statement111 Notes to the Company financial

statements114 Shareholder information

01BCA Marketplace plc Annual Report and Accounts 2017

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Business highlights

Volumes

BCA owns and operates the UK’s and Europe’s largest used vehicle exchange, both in terms of the number of vehicles sold and revenue, and with WeBuyAnyCar, is the UK’s leading

provider of vehicle buying services. The Group’s Automotive Services division has the largest transporter fleet in the UK, significant storage capacity and technical expertise in vehicle

preparation and refurbishment.

From technical and logistics services for new vehicles, refurbishment, storage and logistics for the growing used sector and the core remarketing and auction operation, BCA offers

the economies of scale and range of services to meet the needs of an impressive portfolio of customers.

As the automotive industry continues to evolve, BCA Marketplace is uniquely placed to deliver a comprehensive range of linked services through the combined infrastructure of

regional de-fleet facilities, vehicle logistics and preparation centres and a suite of remarketing channels, including physical, hybrid and digital exchanges. BCA’s Partner Finance offering

provides additional liquidity to buyers to support growth.

BCA is investing and innovating in its business today in order to be best placed to benefit from the changing face of the automotive industry of tomorrow.

347,000Vehicles sold by

International Vehicle Remarketing

194,000Vehicles sold by WeBuyAnyCar

956,000Vehicles sold by

UK Vehicle Remarketing

2016 888

2016 333

2016 172

2017 956

2017 347

2017 194

800 300 140800 300 1401,000 360 2001,000 360 200

900

‘000 ‘000 ‘000 ‘000 ‘000 ‘000

330 170900 330 170


Executive Chairman’s statement

Together for growth“BCA Marketplace plc was formed to build a cohesive,

broad-based services business in the automotive sector and I am pleased to announce continuing strong results and strategic

progress for the Group.”

4.2%Volume growth in Europe

12.8%Volume growth in WeBuyAnyCar

Dear Shareholder,I am delighted to present BCA Marketplace’s second Annual Report. During the year the Group has continued to deliver good financial and strategic progress. Volume growth and increased services revenue across the business have driven an increase of 37.7% in adjusted EBITDA to £135.6m and adjusted diluted earnings per share has increased to 9.1p, up 30.0% (compared to 7.0p in 2016). Operating profit has increased by £58.0m to £74.3m, driven by the growth in adjusted EBITDA and a lower level of significant one-off and non-recurring items relating to acquisitions and corporate activity.

In July 2016 we acquired Paragon Group, the leading provider of de-fleet and refurbishment vehicle services in the UK, and an important component towards achieving our vision to be the leading, integrated, automotive services business. In March 2017 we acquired an alloy wheel refurbishment business, Supreme Wheels Direct, further adding to our range of in-house services. These acquisitions are consistent with our strategic aim to provide a seamless and efficient one-stop shop for the passage of vehicles throughout their life cycle.

As a result of the integration of acquired businesses, organic growth and new outsourced remarketing contracts, Group revenue exceeded £2.0 billion in the year (2016: £1.2 billion).

7.7%Volume growth in the UK

2017 135.6

2016 98.5

£135.6mTotal adjusted EBITDA* (£m)

2017 5.2

2016 1.2

5.2pEarnings per share (basic)

2017 5.1

2016 1.2

5.1pEarnings per share (diluted)

2017 9.1

2016 7.0

9.1pEarnings per share (adjusted diluted)*

2017 9.2

2016 7.1

9.2pEarnings per share (adjusted basic)*

2017 6.75

2016 6.0

6.75pDividend (pence per share)

2017 74.3

2016 16.3

£74.3mTotal operating profit (£m)


During the year we celebrated several significant milestones for the heritage of our brands. The UK Vehicle Remarketing business, British Car Auctions, recorded its 70th year of trading since its first auction as Southern Car Auctions. Throughout its history this business has worked with vendors and buyers to provide trusted and transparent remarketing. Our UK Vehicle Buying service, WeBuyAnyCar, purchased its one millionth vehicle in its tenth year of trading. Consumer recognition of WeBuyAnyCar as a trusted service provider was evidenced by the Trustpilot 5 star (out of 5) rating received during the year.

More detailed information on our operating and financial performance can be found on pages 34 to 38.

BoardAs a Board, we feel that continually striving for enhancement of operational and financial integrity lie at the heart of a well-run company. Throughout the business we look for transparency, accountability and responsibility in everything we do. Later in the report, you will find updates from Jon Kamaluddin, James Corsellis and Mark Brangstrup Watts, the Chairmen of our Board Committees and from myself in relation to our corporate governance progress in the year.

Your Board believes that the effective stewardship of the Group is enhanced by the expertise, independence and breadth of experience of its members and I am therefore delighted to have welcomed David Lis as an additional Independent Non-Executive Director. David’s biography is set out on page 45 later in this report.

DividendThe Board is pleased to recommend payment of an increased final dividend of 4.55p per share. If approved at the Annual General Meeting to be held on Thursday 7 September, this will be paid on 29 September 2017 to those shareholders on the Register at the close of business on 15 September 2017. The shares will become ex-dividend on 14 September 2017.

An interim dividend of 2.20p per share was paid on 31 January 2017. Including this, the total dividend for the year is 6.75p per share compared to a total of 6.00p per share last year, an increase of 12.5%.

Business highlights

* Adjusted measures are defined on pages 78 and 87.

Continuing strong growth

OutlookThe new financial year has started well, with performance since the year end being in line with our expectations. Growth continues with a combination of new business wins and organic growth with existing customers. These developments, together with further planned improvements in operational efficiency through our Together for Growth programme, continue to give the Board encouragement for the future.

Our peopleI would like to thank each and every one of our employees, who work with great effort and pride, to win and integrate new business while maintaining high standards of customer service.

Together, we are committed to developing a robust and ever stronger Group for the future and delivering long-term sustainable value to our customers, employees and shareholders.

Avril Palmer-BaunackExecutive Chairman26 June 2017


Market overview

Vehicle life cycle

As the automotive industry continues to evolve, BCA Marketplace is uniquely placed to deliver a comprehensive range of linked services through the

combined infrastructure of regional de-fleet facilities, vehicle logistics and preparation centres and a suite of remarketing channels,

including physical, hybrid and digital exchanges.


Vehicle Buying page 24

The typical 12 to 15 year life cycle of a vehicle involves four to five changes of owner, providing opportunities for BCA to provide services to the keeper and to both parties on each transfer of ownership.

12-15yrsAverage life cycle

of a vehicle


Vehicle Remarketing page 18

At the end of a vehicle’s life there are decisions around salvage, the recycling of parts and eventual disposal.

At each change of ownership, there are opportunities to preserve and enhance value through refurbishment and remarketing. Each vehicle may also require storage and transportation as it transfers between owners.

Vehicles are expensive, physical, fast depreciating assets, so the ability to provide efficient, joined up services at each stage

in the vehicle’s life cycle is valuable to customers.

Market overview

Vehicle life cycle


Automotive Services page 28

In the journey from the Original

Equipment Manufacturer’s (‘OEMs’) factory gate or dock

to the fleet or retail sales channel there are requirements for transportation, customs clearance, storage, handling, preparation and inspection of vehicles.

During the vehicle’s life with each owner there are opportunities for multiple services such as service and repair to be coordinated and administered.


Spotlight on

A day in the life of a driver

BCA Automotive operates the UK’s largest automotive transporter fleet, delivering a truly flexible and efficient logistics

solution for OEMs, dealer groups, rental companies and remarketing customers.

Following a year of continued investment in its core fleet and with the integration of the acquired Paragon logistics business, the transporter fleet now stands at over 740 vehicles in the UK. The business is built on long-term relationships with key strategic partners, allowing it to run an unrivalled operating model offering customers all the benefits of a strategic network by linking new and used vehicle movements. The ongoing investment ensures that

BCA Automotive operates a modern, well maintained fleet that minimises downtime and utilises the benefits of the latest technologies to constantly improve service levels.

Whether it be moving a used car into or out of an auction centre, a new car delivery to a dealer, an export movement to a port or a rental car de-fleet, BCA Automotive now moves more than two million vehicles per annum.

p Pre-delivery checks minimise downtime


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t Inspection of newvehicles pre-load toeliminate pre-deliveryquality issues

p Loaded and secured,ready for delivery

Delivery to the customer and handover inspection q


BCA Marketplace

At a glanceBCA owns and operates the UK’s and Europe’s largest used vehicle exchange, both in terms of the

number of vehicles sold and revenue, and with WeBuyAnyCar, is the UK’s leading provider of vehicle buying services. The Group’s Automotive Services division has the largest transporter fleet in the UK,

significant storage capacity and technical expertise in vehicle preparation and refurbishment.

Together with its digital connectivity, the Group is able to provide comprehensive vehicle management services to OEMs and fleet owners, and to facilitate efficient changes in ownership between all types of vendors and buyers. BCA is investing and innovating in its business today in

order to be best placed to benefit from the changing automotive industry tomorrow.

The Group’s range of services enables it to have contracts with OEMs that span the complete vehicle life cycle. Factory outbound logistics and port management services allow the Group to track the inventory of new cars as they become available, with its online tool, My Inventory, giving OEMs real time access to this information. At its fully equipped services facilities the Group can make the necessary market and customer modifications to the vehicles and perform pre-delivery inspection and quality checks.

Automotive and logistics services coordinate timely delivery for OEM demonstrator and press fleets, rental fleets, leasing companies and franchise dealers.

BCA Docusafe offers the latest automated storage systems to securely hold and retrieve the documentation associated with each vehicle, including its registration document and MOT.

Inspect Pro captures inspection information as fleet vehicles transition between drivers, with HD imagery & video recording assessments and co-ordinating & costing of repairs during the handover.

See more on BCA Partner Finance on P22

At the point of de-fleeting, or where customers return vehicles at the end of Personal Contract Purchases (‘PCPs'), the Group coordinates sending these vehicles to a range of remarketing channels, including driver sales programmes, allocation among the franchised dealer base and to open physical, hybrid and digital auctions to help distribute volume and maximise value. For dealers, the BCA Dealer Pro service can access the Group’s significant database of car transactions to advise on pricing and, using the App, can allocate surplus stock and part-exchange vehicles to auction.

Digitally linking each stage allows vehicles to move more efficiently through the entire process, minimising the holding period and costs for vendors. It provides the buyer with greater detail of the vehicle and imagery on purchase, enabling them to move quickly to advertise their upcoming inventory.

Buyers can utilise BCA Partner Finance to fund the hammer price, fees and transportation costs for a period of up to 120 days.

No competitor offers the range and scale of services that BCA does, and many customers currently only use discrete areas of our expertise. The Group strives to be needed by its customers, delivering joined up, efficient services to existing relationships and attracting others into forming new partnerships with BCA.


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Adding value in all areas

Key differentiators

BCA is unique in its breadth of services across the automotive value chain, including an online to offline offering that integrates digital and physical infrastructure. This provides a compelling customer service proposition and also creates efficiencies

through synergies across all the divisions.

• The scale and capacity of the geographic footprint, which in the UK has sites positioned along the spine of the country and close to motorways and in continental Europe the most significant remarketing presence

• The aggregation of inventory with a balanced portfolio across sectors and vendors, including the mix and diversity of supply from WeBuyAnyCar

• The tenure and strength of customer relationships on both the supply and demand side

• The experience and professionalism of the operations team

• The largest UK fleet of transporters and the UK’s largest single vehicle movement capability forming an efficient vehicle delivery network

• Buyer funding to provide additional liquidity to the vehicle exchanges

• The ability to offer fulfilment of services along the automotive value chain

• Efficiencies created through operational synergies• Digital innovation in the provision of standard tools

and services across the business• Industry and transactional insight from data

gathered at every stage of the vehicle life cycle

See our business model on P18-33


BCA Marketplace continued

The Group operates through four divisions


The Group’s UK Vehicle Remarketing division trades under the BCA brand at 24 auction centres. BCA sells vehicles at its

exchanges on behalf of a broad range of vendors including OEMs, leasing companies, dealers and vehicle buying companies.

Buyers include car supermarkets, franchised and independent dealers, professional vehicle traders and consumers.

Exchanges comprise physical, hybrid and digital auctions, and outsourced remarketing services. These are complemented by a

portfolio of pre- and post-sale value-added services including our buyer funding service, BCA Partner Finance.


The Group’s International Vehicle Remarketing division operates primarily across nine continental European countries from 28 auction centres in Denmark, France, Germany, Italy, the Netherlands, Portugal, Spain, Sweden and Switzerland.

Distinct from the UK market, continental European customers have a higher propensity to trade at online auctions - both within a country and between operating markets - and to

buy vehicles to export to countries including Austria, Belgium, Poland, Romania and the Czech Republic.

24UK auction centres

28European auction centres

See more on P18-22 See more on P18-23

Auction locations

1 2

Vehicle Services

Fleet Solutions


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Vehicle Buying

In the UK, the Group’s Vehicle Buying division operates from over 200 locations as webuyanycar.com. WeBuyAnyCar is the

UK’s leading car buying service, now an established third disposal channel for consumers. Used vehicles purchased directly from the public by WeBuyAnyCar are disposed of

exclusively through the BCA Exchange.

In continental Europe, the Group purchases batches of vehicles directly from corporate entities and remarkets them

through the International Vehicle Remarketing division.

Automotive Services

The Group’s Automotive Services division operates from 19 locations, providing the most comprehensive vehicle

movement network in the UK.

BCA Vehicle Services and BCA Fleet Solutions operate storage & preparation facilities, technical service centres

and de-fleet & refurbishment depots.

BCA Automotive and BCA Logistics operate from a number of principal vehicle loading points, providing

bulk transport and single vehicle moves.

200+WeBuyAnyCar locations

19Automotive Services locations

See more on P24-26 See more on P27-32

u WeBuyAnyCar locations

3 4

Vehicle Services

Fleet Solutions


BCA Marketplace continued

HistoryBCA Marketplace plc has acquired companies

with a heritage of growth and innovation

WeBuyAnyCarstarted trading

BCA Dealer ProBCA Assured

Smart PreparedBCA Live Online

Auction Grading

BCA Video Appraisals

Haversham Holdings formedFloat on AIM

1st auctionas Southern Counties Car Auctions


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BCA Partner Finance part-exchange launched 31 March 2017Supreme Wheels acquired(Alloy wheel refurbishment business)

1 June 2015SMA Vehicle Remarketing (SMA) acquired (Auction business)

4 February 2016Ambrosetti UK acquired(Vehicle preparation refurbishment and de-fleet)

BCA Partner Finance 1000 live dealers

Perry Barr auction centre opened

18 July 2016Paragon Group acquired(Automotive services group)

2 April 2015BCA Group acquired by Haversham HoldingsFloat on LSE as BCA Marketplace plc

25 August 2015BCA Automotive acquired(Automotive logistics business)

€752,800Mercedes G Wagon sells for €752,800 in Germany

WeBuyAnyCar bought its 1 millionth car

They’ve purchased over one million cars

1,000,000

Top five luxury buys:Rolls-Royce Wraith Coupe

Ferrari FF CoupePorsche 911 GT Coupe

Aston Martin Vanquish CoupeAston Martin DB9 Coupe

Top five most popular buys:Vauxhall Corsa

Ford FocusFord Fiesta

Vauxhall AstraBMW 3 Series


Strategy

Creating valueThe Group’s strategy is to create value through acquisition and organic growth in the

automotive sectors across the UK and Europe. The aim is to integrate along the automotive value chain, focusing on developing extended, unified solutions: increasing volumes, creating value-added services and improving efficiencies.

Short term

The Group will build upon the strengths of its fulfilment capabilities, physical real estate, vehicle buying and automotive relationships to enhance its operations and integrated solutions in both

the UK and continental Europe in order to reach full scale. In Europe, the Group will seek to expand its geographical footprint.

Medium term

The Group will continue to develop its operations along the automotive value chain in the longer term through both organic growth and tactical acquisitions, with a focus upon the intelligent use

of data and other innovations. The Group will seek to deepen the service relationship, drive efficiencies and value generation with the vehicle’s keeper.

Long term


• Continue to win volume through strong customer relationships

• Secure volume for the long term and grow to full scale

• Grow BCA Partner Finance• Enhance BCA product suite• Expand digital information

flow• Increase efficiency

through use of technology at auction branches

• Expand outsourced solutions


• Grow volume through increasing market awareness

• Standardise processes and tools and employ best practice

• Build one market• Deliver a consistent

buyer experience• Expand service offering• Broaden customer base• Increase penetration of

BCA MarketPrice

Vehicle Buying

• Grow volume by promoting the third disposal channel

• Continue to broaden the appeal of the WeBuyAnyCar brand

• Provide vehicle mix and volume to the Exchange

• Seed new sites and sale days in Europe

• Continue to improve customer service

Automotive Services

• Integrate further to achieve a single more efficient operating model

• Expand suite of value-added services

• Coordinate movements efficiently between divisions

• Package solutions for customers across all Group divisions

• Refurbish and upgrade owned vehicles for onward sale

1 32 4


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For shareholdersThe Group provides an excellent opportunity to deliver

attractive shareholder returns based upon a proven strategy, strong management team and sustainable

competitive advantages.

• Strong earnings potential• Cash generative business

model• Opportunities for organic

and acquisitive growth• Diverse revenue stream• Market leader

• Investment in the Group’s long-term sustainable growth plans

• Progressive dividend policy• Targeted pay-out ratio of

75% of earnings in the medium term

For remarketing buyersThe Group fulfils sourcing needs via the

largest aggregation of stock, providing choice, convenience and value.

• Wide choice of stock across marques, models, ages and conditions

• Market leading aggregator showing all stock with comprehensive vehicle information including guide pricing, giving confidence buying online

• Excellent vehicle presentation

• Full calendar of sales throughout the year

• Stock funding service through BCA Partner Finance, for managing cash flow and as an additional source of lending

• Delivery of vehicles • Assistance with onward

vehicle marketing e.g. imagery

For WeBuyAnyCar customersThe Group provides an alternative disposal

option to part-exchange or private sale.

• Accessible online used vehicle valuation

• Transparent process• Any make or model

purchased

• Quick and efficient on site process

• Convenient locations• Secure payment available

within two hours

For remarketing vendorsThe Group optimises price performance and sale

conversion rates of their used vehicles through a route that maximises financial return, speed and convenience.

• Physical footprint optimising returns to vendors

• Promotion of vehicles including BCA Search; online aggregation of all inventories

• Comprehensive vehicle descriptions including age, mileage, specification, condition, guide pricing and images

• Full portfolio of auction services for best presentation of vehicles including BCA Dealer Pro, collections, appraisal, valeting and BCA Assured

• Bidding/buying demand achieved through buyer base diversity

For corporate owners (OEMs, fleet operators and lease providers)

Group capabilities allow them to fully outsource vehicle management, conditioning, keeper contact

and logistical moves.

• Scale of physical estate for storage

• Integrated real time tracking of vehicles

• Geographic coverage reducing logistics costs

• Reduced time and depreciation to vehicle sale

• Transportation network allowing efficient collection and delivery

• Refurbishment and preparation capabilities to retain value

For employeesThe Group aspires to be a great place to work.

• Attract and retain employees

• Develop knowledge and skills of the Group’s sector and services

• Rewarding careers with opportunities for training and progression

• Safe and fair working environment

Delivering value

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Business model

Vehicle RemarketingThe Exchange is at the hub of the Group’s business model, managing used vehicle

transactions between vendors and buyers. This is complemented by a broad range of value-added services that fuel the Exchange. Scale, liquidity, value, efficiency and

transparency are hallmarks of the operation.

BCA sells used vehicles of all ages and types, principally cars and Light Commercial Vehicles (‘LCVs’), both online and at physical auctions, with most vehicles being auctioned simultaneously across both platforms.

Supply is generated from a wide range of customers who use auction as their primary disposal channel and who appreciate the transparency, efficiency and liquidity provided by the Exchange. Vendors include OEMs, car dealerships, rental, contract hire, leasing and finance companies. Another key source of supply is from the Group’s Vehicle Buying division.

Demand is generated by a large, diverse buyer base that ranges from large car supermarkets to vehicle traders who recognise the value, scale, choice and footprint of the Exchange network.

As an exchange the Group does not generally take title to the vehicles that it sells, instead generating revenue through transaction fees from both buyers and sellers, as well as fees generated through a portfolio of value-added digital and physical pre- and post-auction services such as inspections, logistics, appraisals, repairs, valets and the provision of buyer finance through BCA Partner Finance.

Recently enhanced service capabilities allow BCA to refurbish selected vehicles, enhancing the appraisal condition for resale. In certain circumstances BCA will take ownership of these vehicles to provide certainty to the vendor and allow the opportunity to increase sales value. In these cases the revenue and cost of sale of the vehicles are recognised on a gross basis.

The Group’s systems capture vehicle information at key stages of the automotive value chain including details of any Exchange transaction. Analytic tools and models generate insight that is used to optimise the performance of the Vehicle Remarketing and Vehicle Buying divisions as well as to provide insight services to customers.


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BCA Inspect Pro

Accurate and consistent vehicle inspections

BCA is a leader in vehicle inspections, supporting many of the UK’s leading OEMs as well as leasing and fleet operators. BCA Inspect Pro, the Group’s new inspection application, captures high definition imagery from a comprehensive and consistent inspection process to identify and record standard and out of standard damage.

BCA Inspect Pro provides the flexibility to be able to work to customer determined standards depending on specific needs, including manufacturer standards and British Vehicle Rental and Leasing Association guidelines.

The cost, repair and replacement reports provide an indication of the charges at the end of the collection and inspection process. These reports are transparent to the vehicle keeper, allowing them to review the information and provide an electronic signature on a time and geo-stamped output. This reduces contested end of contract returns and increases claim recovery efficiency.

Clarity on the true condition provides valuable data for the evaluation of potential refurbishment activities ahead of remarketing.

Spotlight on


Business model continued

Vehicle RemarketingBCA hosts exchanges online and across 52 auction centres and provides outsourced

remarketing services.

The Group is the market leader in vehicle remarketing across the UK and Europe, with a portfolio of value-added services that support customers, large and small, throughout the automotive value chain.

The divisions, which facilitated the sale of over 1.3m vehicles in the last year, operate in two distinct markets: the UK trades right-hand drive vehicles and continental Europe left-hand drive vehicles. The International Vehicle Remarketing division enables the sale and export of vehicles across country borders

as well as in the local markets. The markets are also distinguished by their sales channels and market penetration; UK vendors and buyers typically trade at physical auction centres, although all physical auctions can be accessed electronically through BCA Live Online. European customers have a higher propensity to trade through online auctions. In the UK, exchanges are the primary volume disposal channel for corporates and dealers, whilst there is a significant opportunity to increase penetration in Europe.

30.7%UK sales are online

66.0%International sales are online

1 Inspect & collectBCA inspects vehicles, providing an accurate description of vehicle condition as early as possible in the de-fleet process, utilising the latest technology to produce vehicle condition reportsThe inspection service can be integrated with our collection service to provide an outsourced end-of-lease solution for customers

1a Driver sales

2 Dealer ProBCA Dealer Pro and BCA MarketPrice in the UK and Europe are applications used by dealers to facilitate the part-exchange process and the disposal of unwanted vehicles to the Exchange. These applications provide valuations based on BCA's pricing dataBCA Push to Auction enables the rapid transfer of vehicle data from dealer part-exchange to BCA’s auction systems for increased marketing time

Outsourced solutions include ‘Driver Sales’ teams to sell end-of-lease vehicles to the current driver on behalf of the lessor

See more on valuations P33

3Delivery

4Storage


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Outsourced remarketing services are provided in the UK to OEMs, fleet and leasing companies. BCA Online provides a portfolio of tools to optimise performance in the used vehicle marketThe proposition includes multi-channel digital marketing and telesales to allocate volume, a white label platform to allow franchise dealers to view, access and purchase available stock, and digital and physical auctions to provide broad access to independent dealers and car supermarkets

11 Partner Finance BCA Partner Finance is a stock funding service that covers the hammer price, fees and delivery costs of vehicles purchased for up to 120 days

5-9 Fully integrated pre-sale (Exchange) services optimise the presentation of vehicles, including appraisal of vehicle condition, BCA Assured (a 30 point mechanical inspection) and vehicle preparation (valet and smart repairs) before they are marketed on the BCA Auction view search catalogue

See more on P22

5Refurbishment

6Vehicle

preparation (valet, appraisal,

bodyshop)

7BCA

Assured

8Imaging

and video

12Delivery out

9Auction view

BCA’s online platforms allow buyers to purchase with the same confidence as at physical auction. A dedicated messaging service enables engagement with the auction clerk during the sale, along with instant visibility of the proxy bid. The platform has advanced search tools to identify vehicles and provides a seven day purchase history

10 Vehicle remarketing (BCA e-auction, BCA Live Online, BCA Bid Now Buy Now, Physical sale)


Spotlight on

BCA Partner Finance

BCA Partner Finance provides an additional source of stock funding for the purchase of vehicles at BCA auctions. The uncomplicated process of being able to fund 100% of the invoice price and arrange delivery immediately ensures dealers are able to optimise cash

flow and stock turn, both key ingredients in successfully managing profitability.

Fast growing motor retailer Imperial Car Supermarkets chose BCA as a partner to provide stock funding and remarketing services.

Imperial Car Supermarkets has grown quickly with a clear focus on customer satisfaction and a commitment to transparency throughout the sales process.

The partnership with BCA helps the company operate more efficiently and supports growth.

BCA Partner Finance allows approved dealers to get on with the profitable business of sourcing and retailing used vehicles. Dealers value the simplicity of the service and can use the facility to fund auction purchases.

“BCA is uniquely placed to cover our remarketing needs from funding purchases to valuing and appraising part-exchanges, and then remarketing the non-retail stock. BCA brings the scale and

commitment to innovation that mirrors our own business, giving us peace of mind that our vehicles will achieve good returns, quickly and efficiently.”

Mike BellManaging Director at Imperial Car Supermarkets


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Spotlight on


One Europe – a digital roadmap

International Vehicle Remarketing has embarked on an ambitious plan to transform vehicle remarketing across a European market without borders. Today more than two out of three cars are sold electronically and one in eight cars are sold cross border, so there is already a clear trend. BCA’s focus for the next 12 months is to accelerate digital and cross border transactions.

Internal processes will be standardised and augmented in order to be able to handle greater volumes while maintaining efficiency and quality. A new auction platform will be in place with the ability to add modules designed to provide innovation and value to customers.

The buying experience will be transformed. All buyers will have ready access to all stock, with intelligent support and guidance. Buyers will be able to have full confidence in

BCA’s pan-European vehicle descriptions, objective mechanical & cosmetic grading, pricing and delivery.

For vendors the doors will be opened to a vast and efficient pan-European market, supported by BCA’s extensive physical footprint, infrastructure and expertise. Products such as BCA Inspect Pro will be used to assess the condition of returning vehicles in a standard way and the Group’s core remarketing network will convert vehicles into cash quickly and reliably.

These changes will also support an increase in stock turn and therefore profitability for dealers, a message reinforced through the Group’s increasingly popular ‘Dealer Day’ events. The Group looks forward to supporting this development and partnership further through both its market expertise and future innovation.



Vehicle BuyingVehicle Buying fuels the Exchange

with a diverse mix of vehicles.

webuyanycar.com is the UK’s leading car buying service, leveraging its proprietary online pricing quotation system and rapid physical sale process. WeBuyAnyCar purchases used vehicles directly from the public in the UK, and disposes of these vehicles through the BCA Exchange. This controlled sourcing of vehicles for the BCA Exchange ensures utilisation of assets in the BCA Vehicle Remarketing division and de-risks the Group from the variability of vendor supply. The transparency of the WeBuyAnyCar offering to the consumer helps the whole industry to become more efficient. Consumers now have an alternative channel for the disposal of used

vehicles, freeing them from the inconvenience of private sale and the potential financial inefficiency of part-exchange (particularly when consumers change vehicle make).

In continental Europe, vehicle buying has continued to be rolled out on a strategic basis, where the advantage of controlled vehicle supply provides mix and diversity to the BCA Exchange. These businesses focus on buying batches of vehicles from corporate entities, rather than directly from the public, and remarketing them through the International Vehicle Remarketing division.

4 A vehicle buyer assesses the vehicle condition against the quotation and verifies the documentationThe consumer is taken through the inspection to ensure it is fair and transparent

1 The consumer searches online to ’value’ their car. WeBuyAnyCar features prominently on search results

2 Free valuation On providing the vehicle registration number and condition details, the consumer receives a free quotation using a proprietary online pricing quotation system

3 Book appointmentThe consumer books an appointment at a local retail branch. The sites are designed to be easily accessible


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200+We Buy Any Car

locations

6 WeBuyAnyCar arranges transportation to a Remarketing centre for a sale of the vehicle by auction

www.webuyanycar.com is designed to be quick, simple and transparent for the time constrained consumer

5 Sell your carThe consumer accepts the vehicle quotation, signs a contract and selects a payment option (premium c. two hours, next day or four days)


webuyanycar.com

WeBuyAnyCar customers rate them ‘Excellent’

“Appointment only took half an hour. Saves hassle of private sale and I got more than I’d

been offered in part exchange.”

Trustpilot review7th August 2016

Why people choose webuyanycar.comDuring the year, webuyanycar.com achieved a 5 star rating (out of 5) on Trustpilot,

the independent review site, and have over 12,000 customer reviews. We continue to focus on earning consumer trust in the service we provide. As the UK’s leading car buying

service they have now purchased over one million cars WeBuyAnyCar’s customers say they value the speed and ease that the service offers them

Spotlight on

Secure payment

No strangers at your door

Finance settled

100% no obligation

Money straight in your bank

Over 200 branches

nationwide

“The buyer was very helpful and gave a detailed description of the procedures involved. I got a

better price than I was offered for part exchange.”

Trustpilot review 16th November 2016


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Spotlight on

Automotive Services

BCA has enjoyed a relationship with Fiat Chrysler at Portbury for more than 25 years.

BCA has enjoyed a relationship with the Fiat Chrysler Automobile Group for more than 25 years. The Portbury vehicle import centre near Bristol receives more than 100,000 vehicles annually from the Fiat Chrysler factories in Europe and the USA. The Group’s IT systems process information from the point a

vehicle leaves the factory, tracking its status and location right through to its final delivery to a UK dealer. The joined up services of vehicle reception, storage, processing and logistics give Fiat Chrysler one point of

contact for their finished vehicle supply chain to the UK market.



Automotive ServicesSignificant physical infrastructure, comprising land for storage,

facilities for service and the UK’s largest transporter fleet, combined with digital platforms to manage and track vehicles.

The national network of sites creates industry leading capacity and the ability to provide efficient solutions and economies of scale spanning new vehicle, in life and de-fleet services.

The division was established during the year to improve support for OEMs and fleet operators throughout the vehicle life cycle.

Through the integration of Stobart Automotive, Ambrosetti, Paragon and Supreme Wheels, management and delivery of the services has been realigned into four operations: BCA Vehicle Services, BCA Fleet Solutions, BCA Automotive and BCA Logistics.

1 BCA Vehicle Services – provides new vehicle services

• Reception and handling of vehicles at the port or factory gate: From receipt of vehicles off the ship to clearing customs, Vehicle Services can process and handle all requirements either on BCA sites or managed facilities

• Pre-delivery inspection (‘PDI') and vehicle preparation: Vehicle inspection and preparation to manufacturer specifications, to ensure transit damage is identified and vehicles are presented at the highest quality to fleet and corporate customers

• Storage facilities and compound management: Vehicle shipments are stored, managed and distributed in accordance with manufacturer instructions

• Warranty and servicing: Technical inspection and vehicle maintenance

• Customisation and accessory fitment: technical and mechanical expertise to customise and fit optional accessories in line with manufacturer specifications

a


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2 BCA Fleet Solutions – delivers fleet management, de-fleet and refurbishment services

a Fleet management• Booking management and administration

of fleet vehicles (demonstration, press, VIP, pool and company cars)

• Vehicle preparation, delivery, maintenance and storage

b Fleet reporting• Document management (vehicle

registration, fines and contravention management, and V5 management)

c Refurbishment and de-fleet• Vehicle refurbishment to exacting and

consistent standards • Inspection & estimating• Service & warranty• Studio quality HD video & imaging• Secure storage

The high volume of vehicles managed allows the Group to be cost effective, whilst delivering the quality required for the remarketing channel.

b

c



3 BCA Automotive – handles bulk logisticsWith a UK fleet of over 740 trucks, the Group moves over two million vehicles per year, delivering from ports, manufacturing centres, refurbishment centres, PDI facilities and auction centres across the UK

The network also includes smaller transporters to handle lower volume deliveries such as demonstrator and press fleets

The operation is supported by a regional management function led by an experienced operational team to ensure seamless communication with customers. Technology is key, and the Group’s in-house IT capabilities ensure that solutions are state-of-the-art and linked to real time fleet tracking

The bulk fleet has a track record of delivering bespoke solutions to clients that integrate seamlessly into their logistics plans to reduce cost, time and environmental impact.

• Bulk movement of vehicles from port or factory to dealerships and corporate customers

• End of lease or early termination collection for fleet and finance companies

• Flexible collection of dealer part-exchange or overage stock, destined for either remarketing or another dealership

• Delivery to dealer forecourts of vehicles purchased at BCA or other remarketing companies


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4 BCA Logistics – provides single vehicle movementsWith single driven vehicle movements, vehicle handover specialists and trade plate drivers, the Group offers a comprehensive vehicle logistics service, supporting customers through the whole process of vehicle inspections, collections, deliveries and demonstrations

The Group’s vehicle logistics platform utilises the latest mobile, handheld and tablet technologies to deliver customer data, management dashboards and full control of the logistics process, including visibility of customer vehicle movements with real time information

Inspections can take place at any point in advance of remarketing with bespoke parameters and reporting. The BCA Inspect Pro product is fully transparent and offers timely, accurate condition information to make informed decisions on:

• Damage recharge• Vehicle repair and preparation• Remarketing sales channel and pricing

Inspections can be fully integrated with collection and subsequent remarketing activities such as vehicle repair, preparation and allocation to sale. The Group is growing volumes from both existing customers and new business wins. The ongoing investment programme is building capacity in the physical footprint, logistics, technology and process to provide an end-to-end supply chain service alongside the core vehicle remarketing business

“Integration of the acquired businesses into this structure means BCA strengthens its operations covering the vehicle

life cycle. The national network of sites creates industry leading capacity and the ability to create efficient solutions and economies of scale spanning new vehicle, in life and

de-fleet services.”

Avril Palmer-BaunackBCA Executive Chairman


Distribution Centre – Immingham

Kia Motors

Under a ten year contract, construction to develop the Kia Distribution Centre commenced in August 2015. By December 2015 the first vehicles were received from the port and dispatched into Kia’s distribution network.

The investment delivered a centre of excellence which includes state-of-the-art workshop facilities, the first

implementation of Radio Frequency Identifiers in the automotive sector for efficient compound management, and secure tarmac storage.

Following its successful opening, the facility received the 2016 Automotive Supply Chain Award for Processing Centres.

Spotlight on

“The transition was managed excellently. In the face of many challenges and constraints, the robust transition plan and structured, committed approach has delivered a centre

of excellence to the required timescales. Since the transition, KMUK has exceeded almost every plan and target and set lots of new records! My sincere thanks to your team for their

incredible efforts.”

Awais AjmalGeneral Manager Supply Chain for Kia Motors UK (‘KMUK’)


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Spotlight on

BCA Dealer Pro

Market leading accuracy, £100 per vehicle improvement over 12 months from bringing service in-house

The Group currently provides over 35,000 part-exchange valuations a week to BCA Dealer Pro customers. The accuracy of valuations is critical; too high and the dealership will not be able to recoup the value when they remarket the vehicle, too low and they risk losing the sale of the new vehicle as their customer looks elsewhere. Historically an external provider undertook this valuation service but over the last 12 months this capability has been brought in-house. This has already delivered significant improvements in accuracy for customers. Accuracy is monitored in real time by comparing valuations with the vehicle prices achieved at Group auctions. Comparing the accuracy of recent valuations with transactions from an equivalent period last year there has been an improvement of more than £100 in the absolute accuracy per vehicle.

How was this possible?The Group has a unique database of five million UK vehicle auction sales. For each of these transactions, detailed information is collated about the cosmetic condition, mechanical condition and optional extras on each vehicle as well as the standard vehicle information such as the make, model, derivative, age and mileage. Over the last 12 months the Group’s data science team has been applying modern machine learning techniques to this database. The additional (and proprietary) data has brought significant improvements to the service.


Operating review

Continuing strong growth

RevenueYear ended

2 April 2017£m

Adjusted EBITDA1

Year ended 2 April 2017

£m

Operating profit


£m

RevenueYear ended

3 April 20162

£m

Adjusted EBITDA1


£m

Operating profit


£m

UK Vehicle Remarketing 753.8 84.0 57.8 242.3 69.1 40.9International Vehicle Remarketing 135.4 26.2 11.7 109.5 18.9 5.1Vehicle Buying 837.0 19.5 12.2 698.4 16.1 8.3Automotive Services 303.5 17.2 7.4 102.9 4.2 1.3Group costs – (11.3) (14.8) – (9.8) (39.3)

Total 2,029.7 135.6 74.3 1,153.1 98.5 16.3

1 Adjusted EBITDA is considered by management to be the most appropriate indicator for assessing operational performance of the business and represents the continuing earnings before interest, tax, depreciation and amortisation, acquisition costs and other significant or non-recurring items

2 The prior period was a 15 month period, however it represented a 12 month period of trading. Prior period comparatives have been re-presented to reflect the expanded operating divisions

BCA Group performanceThe Group delivered strong growth across all divisions. This result was driven by a combination of organic volume growth, increasing penetration of new and existing services, improved efficiency and the early benefits of operating synergies from the acquired businesses. The July acquisition of Paragon was an important step in the strategy to deliver a broad based automotive support service business.

Operating divisionsDuring the year, management made significant progress in the integration of the acquired businesses to form the Automotive Services division, bringing together the facilities and capabilities of BCA Automotive (acquired August 2015), Ambrosetti (February 2016) and Paragon (July 2016) with BCA Logistics (previously part of the BCA Remarketing UK business). The four retained SMA sites (acquired June 2015) were all rebranded as BCA and integrated within the UK Vehicle Remarketing division.

As the divisional structure has expanded, the prior period comparatives have been re-presented to reflect the four operating divisions; UK Vehicle Remarketing, International Vehicle Remarketing, Vehicle Buying and Automotive Services. Group costs are reported separately. This structure reflects the financial information the Group’s Board, the chief operating decision maker, uses to make decisions about the allocation of resources, in accordance with IFRS8, Operating Segments. A reconciliation to the prior year divisional structure has been included within the segmental note on pages 78 to 80.

Divisional operating reviews are focused on adjusted EBITDA1 in order to give a more meaningful analysis, since depreciation, interest and tax are principally managed centrally on behalf of the Group and significant or non-recurring items do not directly correlate to continuing divisional operating performance. A reconciliation of adjusted EBITDA to operating profit is provided in the financial performance section on page 37.

In order to present its financial position in the most meaningful way, BCA Marketplace prepares its accounts to a Sunday within seven days of 31 March, this year being the 52 weeks to 2 April 2017. The prior period was a 15 month period, however it represented a 12 month period of trading following the acquisition of the BCA Group. Divisional trading performance over the following pages has been analysed compared to 12 months of trading in the prior year, with the acquisitions of SMA, BCA Automotive, and Ambrosetti included from their respective acquisition dates. Paragon has been included from its acquisition on 18 July 2016.

Group revenue was £2,029.7m (2016: £1,153.1m), with growth driven across all divisions.

Substantial revenue increases arose from new outsourced remarketing contracts in UK Vehicle Remarketing and the growth of Vehicle Buying; where the Group takes ownership of the vehicles before onward sale through the remarketing channel and sells vehicles in its own right as opposed to an agency basis where only a fee is recognised.

The newly created Automotive Services division delivered revenue of £303.5m, including Paragon since its acquisition, and the impact of a full year’s results for BCA Automotive and Ambrosetti.

Strong volumes in each of the divisions produced an adjusted EBITDA for the year of £135.6m (2016: £98.5m), an increase of 37.7%.

UK Vehicle Remarketing adjusted EBITDA was up 21.6% driven by growth of 7.7% in volumes, the increased penetration of BCA Partner Finance and operational efficiencies. International Vehicle Remarketing saw a 4.2% increase in volumes and as a result of operational gearing and a more favourable exchange rate, generated a 38.6% increase in adjusted EBITDA. Vehicle Buying adjusted EBITDA increased by 21.1% as a result of a 12.8% increase in WeBuyAnyCar volumes and a breakeven performance in Vehicle Buying - International.

The year on year increase in Automotive Services adjusted EBITDA is a result of the impact of acquisitions and operational efficiencies.

Operating profit increased by £58.0m driven by the growth in adjusted EBITDA set out above, and a lower level of significant one-off and non-recurring items than the prior year. The prior year included significant acquisition and placing costs in relation to the acquisition of the BCA Group and listing on the Main Market, which were not repeated in the current year. Amortisation of acquisition intangible assets increased by £4.1m to £38.5m as a result of the Paragon acquisition and the full year impact of the prior year acquisitions.

UK Vehicle RemarketingRevenue growth in the division of 211.1% was delivered primarily as a result of new outsourced remarketing contracts where BCA takes title to the vehicles and remarkets them in its own capacity. These outsourced remarketing contracts underline the Group’s capability to deliver full outsourced solutions to customers utilising our scale and service offering in the automotive services sector. These contracts provide a controlled supply of high quality, newer


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vehicles to the remarketing network, enhancing the variety of available stock in the Exchange.

Highlights Year ended

2 April 2017Year ended

3 April 20162 Change

Vehicles sold (‘000) 956 888 +7.7%Revenue per vehicle (£) 788 273 +188.6%Revenue (£m) 753.8 242.3 +211.1%Adjusted EBITDA1 (£m) 84.0 69.1 +21.6%Operating profit (£m) 57.8 40.9 +41.3%Adjusted EBITDA per vehicle (£) 88 78 +12.8%Adjusted EBITDA margin (%) 11.1 28.5

Ongoing structural changes in the UK market, including the impact of wider corporate ownership of vehicles through their first life, combined with new customer wins, generated volume growth of 7.7% in the year. Buyer demand remained consistently strong, with high conversion rates driving efficiency in the Exchange.

BCA Live Online penetration continued to increase, with more online bids demonstrating buyers’ greater confidence in transacting digitally with BCA, increasing the number of active bidders in each auction. Continued investment in imagery, appraisal and warranty products enhances buyers’ information and assurance, bringing them a better understanding of the vehicles offered. This leads to both strong conversion rates and price performance.

October saw the opening of the new auction centre at Perry Barr, Birmingham, which contains three auction lanes plus a state-of-the-art digital auction suite. There is undercover viewing for 450 vehicles, customer parking for over 400 vehicles, a restaurant, barista kiosk and business suites. It is delivering a programme of modern, premium OEM vehicle sales in the heart of the country. The site in nearby Castle Bromwich, Birmingham continues to operate its complementary Light Commercial Vehicle (‘LCV') and older vehicle sales programme. The Group continues to invest in the estate to expand capacity and appropriately target vehicle types by channel. Developments including Manchester Belle Vue LCV centre and Bedford Remarketing are set to complete during 2017/18. The conversion of former SMA sites to the BCA brand, products, services and processes has improved their efficiency and contributed to the overall UK Vehicle Remarketing performance.

BCA Partner Finance continues to enhance liquidity and capacity for dealers, increasing buyer demand. Continued growth in the number of dealers using BCA Partner Finance and a corresponding increase in the number of financed units has seen penetration increase to 11.3% of all UK Vehicle Remarketing units sold in March 2017 (March 2016: 7.0%). The resulting loan book has grown to £113.4m (2016: £64.7m). In March, BCA Partner Finance introduced a new part-exchange finance product, where dealers using the BCA Dealer Pro application can value and finance part-exchange vehicles in the same way they finance those acquired in the Group’s auctions. This solution helps dealers manage their stock efficiently and grow their business.

The improvement in adjusted EBITDA of 21.6% to £84.0m reflects the increased penetration of BCA Partner Finance, BCA Live Online and other services (BCA Assured and BCA Dealer Pro). It also reflects the improved operational efficiency resulting from the increased volume of vehicles and greater utilisation of the Group’s in-house transport capability. Adjusted EBITDA margin in the UK decreased to 11.1% as a result of the increased volume of outsourced remarketing transactions where the Group recognises the vehicle sales revenue, reducing the reported margin.

International Vehicle Remarketing The International Vehicle Remarketing division increased volume to 347,000, a growth of 4.2% compared to the prior year. This, along with a favourable exchange rate, drove a 38.6% growth in adjusted EBITDA (22.8% at constant exchange rates), reflecting operational gearing from the extensively online model. If measured at constant prior year exchange rates, revenue and adjusted EBITDA per unit would have been £345 and £67 (2016: £329 and £57, growth of 4.9% and 17.5%) respectively. The average exchange rate for the year was €1.194:£1 compared to €1.350:£1 in the prior year.

HighlightsYear ended



Vehicles sold (‘000) 347 333 +4.2%Revenue per vehicle (£) 390 329 +18.5%Revenue (£m) 135.4 109.5 +23.7%Adjusted EBITDA1 (£m) 26.2 18.9 +38.6%Operating profit (£m) 11.7 5.1 +129.4%Adjusted EBITDA per vehicle (£) 76 57 +33.3%Adjusted EBITDA margin (%) 19.4 17.3

Management continue to focus on raising awareness of auctions and building strong relationships with vendors and buyers. In the year BCA MarketPrice, the Group’s European dealer-focused part-exchange valuation tool, drove growth in remarketing volumes, while helping vendors to maximise their part-exchange performance. BCA MarketPrice provided 1.1m valuations (2016: 0.9m) to a dealer base that has grown to over 1800 dealers (2016: 1400).

The Group’s geographical coverage, flexible sites and online platforms, supported by its ability to collect, inspect, store and deliver vehicles, ensures accessibility to a wide number of buyers through both physical and electronic auctions. This infrastructure has the capacity to allow efficient growth as demand from vendors and buyers increases across Europe. Whilst BCA operates in nine countries, the buyer base was spread across 56 countries (2016: 53).


Operating review continued

The European market has the potential for a significant number of cross border transactions, volumes of which grew during the year, with 45,275 (2016: 36,033) units sold in BCA auctions being exported by buyers from different countries. In order to make this process as efficient and seamless as possible for buyers, branch appraisal & imaging, processes & systems are being standardised, providing a consistent buyer experience across the whole BCA network. To lead this work the European management team was strengthened, with a number of appointments including a European Operations Director. As the Group’s ‘One Europe’ programme develops, a greater proportion of vehicles are expected to be exported as buyers access the vehicles they require from the Group’s extensive stock.

Vehicle Buying The Vehicle Buying division incorporates WeBuyAnyCar in the UK and vehicle buying operations in Europe.

Highlights - UKYear ended



Vehicles sold (‘000) 194 172 +12.8%Revenue per vehicle (£) 4,114 4,003 +2.8%Revenue (£m) 798.1 688.6 +15.9%Adjusted EBITDA1 (£m) 19.5 16.9 +15.4%Operating profit (£m) 12.2 9.9 +23.2%Adjusted EBITDA per vehicle (£) 101 98 +3.1%Adjusted EBITDA margin (%) 2.4 2.5

Highlights - InternationalYear ended



Vehicles sold (‘000) 7.0 3.0 +133.3%Revenue (£m) 38.9 9.8 +296.9%Adjusted EBITDA1 (£m) – (0.8) –Operating result/(loss) (£m) – (1.6) –

WeBuyAnyCar celebrated ten years of trading and recorded the one millionth vehicle purchase in the year. Strong volume sales growth of 22,000 units (12.8%) cemented the market leading position. The division provides a diverse, controlled supply of vehicles into the UK Vehicle Remarketing division, with the proportion of vehicles sourced from this ‘third disposal channel’ now representing over 20% of UK Remarketing volume. Through a varied auction programme, the average WeBuyAnyCar vehicle is sold within ten days of purchase, maximising efficiency and minimising risks of price changes.

The model and evolving advertising have focused on communicating and delivering an easy, convenient and secure experience to consumers. With a network of over 200 branches, WeBuyAnyCar is close to customers throughout the UK, and makes offers on vehicles, regardless of mileage, age or condition. Vehicles purchased in the year ranged in age from a 27 day old Vauxhall Viva to a 27 year old Suzuki Vitara and in price from a £50 Toyota Starlet to a £150,000 Rolls-Royce Wraith Coupe.

We are proud that in the year, webuyanycar.com achieved 5 stars out of 5 in the Trustpilot ratings. We continue to focus on providing a transparent service and earning increased customer trust in the service we provide.

The increased volume drove a 15.4% improvement in adjusted EBITDA to £19.5m. The continued refinement of the valuation process allowed margins to be tightly controlled while delivering volume growth.

In Europe, vehicle buying is focused on purchasing vehicles directly from OEMs and other corporate entities and remarketing these through the International Vehicle Remarketing division. These initiatives will continue to be deployed where they bring benefits in volume, awareness or efficiency and deliver increased value for OEMs and corporates. These operations are used to enrich the mix in Vehicle Remarketing operations or to support customer requirements, so are managed to cover operating costs in the Vehicle Buying division.

Automotive ServicesThis division was created to bring together the new and used vehicle storage, preparation, handling, enhancement, refurbishment and transport capabilities of the acquired businesses, enabling the Group to provide a comprehensive suite of services to customers. As the integration has progressed, the geographic coverage, efficiency and capability of the customer offering has improved. Automotive Services is driven by large contracts and relationships with OEMs and corporate clients where the Group’s scale and capacity help customers manage, process and move significant numbers of vehicles. The division operates from a network of new and used vehicle processing centres across the UK (see division locations on page 13).

Highlights Year ended



Revenue (£m) 303.5 102.9 +194.9%Adjusted EBITDA1 (£m) 17.2 4.2 +309.5%Operating profit (£m) 7.4 1.3 +469.2%Adjusted EBITDA Margin (%) 5.7 4.1

Revenue and adjusted EBITDA growth stemmed from a combination of the acquisition of Paragon (see page 81 for the acquisition accounting), the full year impact of prior year acquisitions and organic growth.

BCA Vehicle Services handles, processes, enhances, stores and distributes new vehicles (imported into, or manufactured in, the UK) to the franchised dealer network or directly to fleet customers, on behalf of the automotive OEMs.

Shortly before the year end the Group completed the acquisition of Supreme Wheels, which brings the capabilities and facilities to refurbish large volumes of alloy wheels to an as new standard.

1 Adjusted EBITDA is considered by management to be the most appropriate indicator for assessing operational performance of the business and represents the continuing earnings before interest, tax, depreciation and amortisation, acquisition costs and other significant or non-recurring items

2 The prior period was a 15 month period, however it represented a 12 month period of trading. Prior period comparatives have been re-presented to reflect the expanded operating divisions


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BCA Fleet Solutions includes used vehicle processing centres that provide refurbishment and associated services to customers (principally corporate fleet owners including OEMs and their captive finance companies, rental and leasing companies), enhancing vehicles to agreed standards before remarketing. With a capability to process over 400,000 vehicles annually and storage for over 75,000 vehicles at its technical and storage locations, the Group has the capacity and capability to meet the needs of major fleet operators.

This division also owns and operates a logistics network comprising transporters, sites, plated drivers, and inspect and collect services.

The ongoing integration programme for the logistics network, including branch transport, single and multiple vehicle movements and the movement of vehicles to and from technical centres, is progressing well. During the year the number of in-house transporters dedicated to serving the auction branch network and spot movements increased, improving efficiencies within the Group and reducing our dependency on third parties.

The latest generation of BCA Inspect Pro has brought enhanced functionality to the Group’s inspection and collect services and is rapidly being taken up by fleet operators (see spotlight on BCA Inspect Pro, page 19).

The cost pressures experienced in UK logistics in the prior year were addressed largely through greater stability of the driver team and a change in the business model to roll out a hub and spoke network, enabling the use of the in-house fleet for longer distance moves. Profitability improved as a result of these actions.

Group costsGroup costs of £11.3m were incurred in the year (2016: £9.8m). This reflects the share based payment IFRS2 charge of £1.6m, an increase of £1.0m due to a full year’s charge, the full Board of Directors for the year, and the increased costs of the larger business.

Financial performanceAs set out in the Operating Divisions section, the divisional operating reviews are focused on adjusted EBITDA as this is the measure used by management to monitor business performance. Depreciation, amortisation, significant or non-recurring items, interest and taxation are managed at a Group level and do not directly impact operating performance of the divisions. The following table reconciles adjusted EBITDA to statutory operating profit, and the overall performance of the Group.

Amortisation of acquired intangible assets was £38.5m in the year (2016 £34.4m) as a result of the full year effect of prior year acquisitions and the amortisation of Paragon intangible assets from 18 July 2016.

Significant or non-recurring items of £2.4m (2016: net cost of £30.8m) consist of a profit on sale and lease back of the Perry Barr site of £5.3m (2016: £nil), partially offset by acquisition related items of £2.9m (2016: £27.4m).

RefinancingDuring the second half of the year, the Group completed a refinancing of the business providing a new increased debt facility of £250m term loan and £250m of revolving credit facility, an extended period and at an improved margin compared with the previous facility. As a result of the refinance, the remainder of debt issue costs (£4.9m) in relation to the old facility were written off in accordance with the accounting policy (see note o on page 75). Costs in respect of the new facility were capitalised and will be expensed over the life of the facility.

The Paragon invoice discounting facility was cancelled at the Group’s request with working capital requirements now being funded internally.

Cash flow and net debtDuring the period the Group generated strong cash flow from operations of £138.3m (2016: £89.9m) and ended the period with net debt of £260.5m (2016: £170.7m). The Group definition of net debt excludes the debts relating to BCA Partner Finance and finance leases, as these are funded under separate asset-backed lending agreements.

At the year end, the Group had additional asset-backed facilities in relation to BCA Partner Finance totalling £120m (2016: £60m), of which £69.0m (2016: £40.2m) was drawn, reflecting increased use of the senior Group facility and retained profits to fund this operation. BCA Partner Finance trade receivables supported by the facility grew to £113.4m (2016: £64.7m).

Finance leases principally relating to land, buildings and transporters totalled £30.8m (2016: £26.9m).

The Group continues to operate comfortably within its banking covenant, and following the refinancing has sufficient headroom for future projects.

Adjusted EBITDA1


£m

Depreciation and

amortisationYear ended

2 April 2017£m

Amortisation of acquired intangiblesYear ended

2 April 2017£m

Significant or non-recurring

itemsYear ended

2 April 2017£m

Operating profit


£m

Adjusted EBITDA1


£m

Depreciation and

amortisationYear ended

3 April 20162

£m

Amortisation of acquired intangiblesYear ended

3 April 20162

£m

Significant or non-recurring

items Year ended

3 April 20162

£m

Operating profit


£m

UK Vehicle Remarketing 84.0 (12.5) (18.5) 4.8 57.8 69.1 (9.8) (18.4) – 40.9

International Vehicle Remarketing 26.2 (3.3) (11.5) 0.3 11.7 18.9 (2.9) (10.1) (0.8) 5.1

Vehicle Buying 19.5 (1.6) (5.7) – 12.2 16.1 (1.2) (5.8) (0.8) 8.3Automotive Services 17.2 (7.7) (2.8) 0.7 7.4 4.2 (2.8) (0.1) – 1.3Group costs (11.3) (0.1) – (3.4) (14.8) (9.8) (0.3) – (29.2) (39.3)

Total 135.6 (25.2) (38.5) 2.4 74.3 98.5 (17.0) (34.4) (30.8) 16.3


TaxationThe effective tax rate for the period of 27.1% is higher than the standard rate of corporation tax in the UK as a result of significant or non-recurring items, a future rate change and the impact of higher income tax rates in Europe.

Significant or non-recurring items primarily relate to the acquisition of the Paragon business and the de-recognition of deferred tax on UK tax losses. Based on the nature of the losses and resulting restrictions on their use, it is not considered probable that the asset will be recoverable.

Excluding the impacts of rate changes, significant and non-recurring items and prior year adjustments the Group has an underlying effective tax rate of 21.8%.

The Group will publish its tax strategy on its website by the end of March 2018. The Group is committed to being compliant with all statutory obligations in respect of tax and ensuring full disclosure to the tax authorities. This includes paying the right amount of tax when it is due. The Group manages tax in a way that is consistent with its values, its standards of governance and considers the impact of its decisions on its reputation and wider stakeholders.

The Chief Financial Officer has executive responsibility for tax matters. The Group has strong relationships with professional advisers and utilises in-house specialists to ensure that tax risks are appropriately considered. When entering into commerical transactions, the Group seeks to be efficient, but fully compliant with all tax obligations.

The Group seeks to ensure it has transparent and constructive relationships with relevant tax authorities and actively engages in respect of significant transactions and future developments.

Earnings per share and dividendsAdjusted basic and diluted earnings per share were 9.2p and 9.1p (2016: 7.1p and 7.0p respectively). Earnings per share has been adjusted by using adjusted earnings and number of shares in issue for the period as shown in note 11. Statutory basic and diluted earnings were 5.2p per share and 5.1p per share (2016: 1.2p per share).

The Group continues to manage its capital across reinvesting for organic growth, acquisitions in line with strategy and maintaining its dividend pay-out ratio. The Board is committed to a progressive dividend policy for the Group to reflect its strong earnings potential and cash flow characteristics. The Company has significant distributable reserves (see Company balance sheet on page 108), and the cash generated by the operating companies in the Group can be distributed up the Group by dividends as required. The Board is targeting a pay-out ratio of 75% of earnings as dividends in the medium term. In addition to the 2.20p per share paid in January 2017 (2016: 2.00p per share paid in December 2015), the Board is pleased to propose a dividend of 4.55p per share (2016: 4.00p per share), subject to approval at the Annual General Meeting (‘AGM’) on 7 September 2017, to be paid on 29 September 2017 to shareholders on the Register on 15 September 2017.

Profit after taxProfit after tax for the year was £41.1m, which was 433.8% higher than the prior period of £7.7m. Profit after tax is stated after charging tax of £15.3m (2016: credit of £3.8m), significant or non-recurring costs within finance costs of £4.9m (2016: £nil), amortisation of acquired intangibles of £38.5m (2016: £34.4m) and net significant or non-recurring credits within operating costs of £2.4m (2016: costs of £30.8m), giving an adjusted profit before tax figure of £97.4m which is 41.0% higher than the prior period of £69.1m.

Operating review continued


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Risk management

Principal risks and uncertaintiesThe Board takes overall responsibility for risk management, with a

particular focus on determining the nature and extent of the risks it is willing to take to achieve its strategic objectives. The Audit & Risk Committee of the Board takes responsibility for overseeing the effectiveness of the risk management processes in the business.

Following the UK’s EU referendum on 23 June 2016 and the subsequent triggering of Article 50 on 29 March 2017 to commence negotiations over the departure from the EU (Brexit), the Group recognises that it is operating in a period of increased uncertainty. The Group has a direct presence and trading relationship in a number of EU countries and the Board believes that Brexit will not significantly impact the Group’s ability to conduct business into or out of the EU in the short to medium term. Cross border transactions between the UK right-hand drive market and international predominantly left-hand drive market are limited. The Board will continue to monitor the political, legal and macroeconomic developments closely.

The Group is pursuing ambitious growth plans and is prepared to accept a certain level of risk in order to remain competitive and to

continue operating in ever changing markets. The Group is clear about the specific risks faced by its businesses and the level of risk that it is prepared to accept in each part of the business.

The Group’s approach to risk is reviewed regularly, and over time its approach towards each risk may adapt as markets evolve.

Group businesses perform regular risk assessments that consider and assess specific risks relevant to their operations. These risks are mapped and calibrated to the Group risk model to inform the Audit & Risk Committee on an operations up basis.

The principal risks and uncertainties that the Board believes could have the most significant adverse impact on the Group’s business are largely unchanged from the prior year and are set out below:

Risk Description Management Actions

Economic environment

The Group could be impacted by any material adverse change in the general economic or geopolitical environment in the UK and the rest of Europe. Activity levels in the automotive industry can be affected by such factors as the availability of consumer credit, the growth of average wages and the level of unemployment, amongst others, which in turn could impact (over time) the volume of vehicles handled by the Group. Due to the relative size of the UK business compared to Europe, the Group is more exposed to changes in the UK economic environment.

Management monitors market conditions on an ongoing basis through the planning and reporting processes. Consideration is given to scalability, adaptability and the provision of a wide range of automotive services throughout the vehicle life cycle to provide responsiveness and resilience.

Strategic The Group’s future operating results are dependent, in part, on its success in implementing its strategic initiatives. The Group’s strategic initiatives are focused on expanding its Vehicle Remarketing operations and platforms, its Vehicle Buying division and its buyer finance business together with expanding the Group’s services businesses. For more detail see Strategy on page 16. These initiatives require extensive planning and management attention and therefore entail execution risk.

The Group’s growth has, in part, been attributable to the acquisition of other businesses, and the Group may continue to expand its business through acquisitions and other business combinations in the future. Diversification of the Group through adding new business activities brings increased complexity and requires additional management resources and skills in order to execute the Group’s strategy of developing a more extensive automotive support services business.

Extensive strategic planning, due diligence and integration modelling are conducted to ensure alignment and fit of acquisitions.

Acquisition and organic business development are focused on services complementary to the Group’s existing offerings.

Investment is made in management capability and sector expertise.



Commercial The Group’s business is dependent on the flow of vehicles through its services. The Group’s key customers provide significant volumes. The loss of a number of these customers or a significant adverse change in the structure of the marketplace as regards the normal terms of business could have a material negative impact on the Group’s future performance.

The Group’s experienced commercial team uses performance monitoring tools and key performance indicators to maintain strong commercial relationships with its customer base, anticipating and solving issues as they arise.

Management works constantly to develop improved digital and physical services to meet customer needs.

Operational The Group incurs significant employment costs and competes with other employers to recruit and retain employees. An increase in the wages and salaries necessary to attract and retain suitable employees may be necessary in the future. In addition, future legislative changes could necessitate an increase in payroll costs.

Availability of suitable land for the storage and handling of vehicles is required to meet the Group’s growth plans.

The Group undertakes significant marketing activities, in particular for its Vehicle Buying division, and any material increase in advertising costs could increase the Group’s marketing expenses.

The Group incurs significant fuel costs in its logistics operations that may escalate. If the Group is unable to pass on future cost increases to its customers, its operating profit margin could be impacted.

Management monitors market rates for wages and salaries, reviews employee turnover and through exit interviews collates information on the appropriateness of the Group’s remuneration structure.

Management works with real estate advisors to identify, lease and manage suitable sites.

Management reviews marketing investment options on an ongoing basis, and undertakes price negotiations appropriate to the scale of the business to allow the Vehicle Buying division to control cost increases and to achieve good value for marketing activities.

Fuel escalation and statutory wage increase clauses are included in customer contracts where possible to protect the business from material changes in fuel and employment costs.

Competition The loss of market share to competitors would have an adverse impact on volume, impacting the operational and financial performance of the Group.

Management works to maintain a strong market position by ensuring very high standards for each of the services provided by the Group, offering a wide portfolio of well-situated sites which provide efficient solutions for customers and the ability to store and manage significant volumes of vehicles.

Management also strives to position the Group as a market leader in innovation through technology to maintain a competitive advantage as new remarketing and distribution channels are created and trialed.

IT systems and information security

The Group’s business and financial performance depend on the effective operation of its information and technology systems. Any issues with the reliability, availability or cyber security of the Group’s systems, online service offerings and business information could impact the Group’s reputation, the number of buyers or vendors or necessitate additional costs.

Management employs specialist resources within the Group’s IT function to monitor information security, recommending and adopting improvements as necessary.

Regular disaster recovery testing and business continuity drills are performed.

Management continues to review and enhance data protection policies.

Despite taking these measures, it is recognised that a cyber security attack on the Group could cause significant disruption and reputational damage.

Intellectual property and brand

The Group’s intellectual property rights include proprietary technology relating to online auction systems as well as trademarks of the Group’s brands, business knowledge and copyrights. The Group has well-established names and brands in many of the markets in which it operates. Any significant damage to these could have an adverse impact on the Group’s performance.

The Group’s intellectual property rights are protected legally, where possible, in every country in which the Group’s products and services are distributed, deployed or made available.

Management works with appropriate media to ensure the best coverage across the different media platforms.

Risk management continued


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Management A significant change in the Group’s senior management could weaken the Group’s business and its ability to execute its strategy. The Group’s senior management has extensive experience in the industry in which the Group operates and has skills that are critical to the operation of the Group’s businesses and the execution of its strategy.

The Remuneration Committee and the Board regularly review the senior management remuneration policy and engagement to ensure that both are market appropriate and motivational. Given the scale and success of the business, the Group is confident that it is capable of attracting and retaining management resources of the highest quality.

Financial and liquidity

The Group reports its results in Sterling but operates in the UK and continental Europe and is therefore exposed to foreign currency exchange rate fluctuations.

The Group’s strategy involves, amongst other things, growing areas of the business that include providing credit facilities to vehicle buyers and buying and holding vehicles in different countries as inventory, on a short-term basis, prior to resale through the Group’s Exchanges.

The Group relies on its finance providers to provide adequate debt to enable the Group to execute its strategies. The Group’s financing is all held at floating interest rates.

The Group operates in multiple taxation regimes which increases the complexity and risk of compliance with certain indirect taxes such as VAT or its equivalent.

Management monitors the macroeconomic and legislative changes in the markets in which it operates.

Credit provided to customers is monitored closely, with additional security taken under a risk based approach.

Regular dialogue is held with the Group’s banks.

Systems, procedures and controls are regularly reviewed to identify, detect and remediate any transactional issues.

Regulation and legislation

The Group’s operations are subject to compliance with extensive laws and regulations, both in the UK and across continental Europe, including laws relating to vehicle brokerages and auctions, data protection, competition, consumer protection, health and safety, money laundering, bribery and taxation. Non-compliance with, or a change in, these laws and regulations could have an adverse effect on the reputation and performance of the Group.

Management has strengthened the central legal function and retains external specialist legal advisors as necessary to support the businesses in the countries in which they operate.

Health and safety experts are employed to provide advice on best practice and to ensure this is acted upon.

A confidential independent reporting line is available for employees and third parties to report concerns.

Physical damage

Natural events, such as hailstorms and flooding or other events such as terrorism, large-scale accidents or theft may impact the Group’s physical auction facilities or affect vehicles stored on the Group’s property awaiting sale or other activity.

Management monitors possible causes of physical damage on a site-by-site basis and risks and concerns are reported to ensure that there is full visibility of any potential issues that might occur and to ensure that insurance cover is in place where appropriate. Where remedial or preventative action is recommended, management considers the appropriateness of such actions on a commercial basis.


Corporate responsibility

Recognising the Group’s leading position within the industry and its place within

the wider community

BCA is aware of its role as an employer and a good neighbour within its community and seeks to be both positive and supportive to the areas in which it operates. It also recognises the Group’s place within the wider environment and leading position within the industry and aims to conduct business in a safe, secure, legal and fair manner for all interested parties including customers, suppliers, employees and the wider community. Maintaining high standards in all these areas is vital to the continued success and development of the Group.

The Group’s approach to corporate responsibility covers the following key areas: our employees, the environment, health and safety and our community. The Board has overall responsibility for corporate responsibility, regularly assessing the needs of the Group’s stakeholders and delegating day-to-day management of corporate responsibility issues to the divisional operating boards. The Group’s principles of corporate responsibility apply to all our employees and sets the minimum standard for their behaviour.

Our employees BCA believes its people are the best in the business. They are friendly, expert and professional and understand that providing excellent service to customers is how to grow the business. Our employees are important to us so we treat them properly and fairly, aiming to make working for the Group rewarding, with a good working environment and the opportunity for career development.

The Group also operates initiatives enabling employees to gain nationally recognised professional qualifications such as National Vocational Qualifications and The Institute of Car Fleet Management’s Introductory Level Certificate. There is also an Apprentice and Graduate Training Scheme to develop future talent.

Employee involvement and commitment are a key focus. The Group’s vision and performance are shared with employees through a number of channels including team meetings, written communications, electronic communications, bespoke staff campaigns and training, bulletin boards and the Company intranet. Annual conferences take place in the UK and Europe where employees are recognised for their achievements including great performance, loyalty and commitment across different areas of the business.

Gender diversity as at 31 March 2017 Female Male Total

Directors of BCA Marketplace plc 1 7 8

Senior Managers (being members of the divisional operating boards, excluding Directors) 1 22 23

Other senior staff, department heads and unit and regional managers 53 240 293

All employees 1,901 4,981 6,882

The Group is committed to treating its employees and job applicants fairly and equally in accordance with its employment practices, policies and procedures and irrespective of age, disability, sex, sexual orientation, gender reassignment, race, colour, ethnic or national origin, religion or belief, marriage or civil partnership, pregnancy and maternity or membership or non-membership of a trade union. This commitment is reflected in the Group’s Code of Conduct.

Individuals with a disability are encouraged to apply for employment with the Group and the Group seeks to provide appropriate facilities to help with their application and attendance for interview, so that they have an equal opportunity to be selected. Whilst employed by the Group, an employee’s needs may change. Where this is the case, the Group will investigate, in consultation with the employee, the possibility of making reasonable and appropriate adjustments to enable them to remain in the Group’s employment and to undertake their role in accordance with those needs.

The Group remains committed to acting ethically, lawfully and in accordance with legislation in respect of human rights. As part of this ongoing commitment the Group has recently published its statement in respect of the Modern Slavery Act 2015 and will continue to monitor and address any issues that come to its attention in this respect by taking prompt and appropriate action on a case by case basis.

EnvironmentThe Group strives to maintain its properties, land and boundaries to a condition that does not adversely affect or endanger its neighbours and the surrounding communities. The Group abides by the law and local planning requirements and considers and responds to issues or concerns raised by its neighbours regarding the operation of its business promptly.

The Group’s locations integrate environmental management into their operational systems and procedures. Monitoring environmental performance in relation to the emission and discharge of pollutants into the air and water is an integral part of the Group’s operations.

Greenhouse gas reporting The Group is required by the Companies Act 2006 (Strategic report and Directors’ report) Regulations 2013 to measure and report its direct and indirect greenhouse gas (‘GHG’) emissions.

Direct GHG emissions are from sources that are owned or controlled by the Group. Indirect GHG emissions are a consequence of the activities of the Group but that occur at sources owned or controlled by other entities.

Scope 1 emissions: Direct emissions controlled by the Group arising from the combustion of fuel which results from the logistics fleet and company cars. This is regardless of whether the vehicles are owned or leased as the Group is responsible for their emissions.


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Scope 2 emissions: Indirect emissions attributable to the Group due to its consumption of purchased electricity.

The methodology used to calculate emissions is based on the GHG Protocol’s Financial Control approach. Emission factors used are from UK government (‘DEFRA') conversion factor guidance current for the year reported.

The report includes the ‘Scope 1’ (combustion of fuel) and ‘Scope 2’ (purchased electricity and gas) emissions associated with the Group’s offices and vehicles for the year to 2 April 2017. Revenue has been used as the intensity ratio as this is a relevant indicator of growth and is aligned with the Group’s business strategy.

2017 2016

Absolute carbon emissions (tCO2)Scope 1 71,026 33,047Scope 2 13,229 8,707

84,255 41,754Revenue (£m) 2,029.7 1,153.1Carbon intensity (tonnes of CO2 per £m revenue) 41.5 36.2

The absolute carbon emissions and the carbon intensity have increased and primarily reflect the full year impact of the acquisitions made in the prior year, and the acquisition of Paragon in the current year.

Health and safetyThe Group’s Vehicle Remarketing divisions operate from over 50 locations across the UK and continental Europe. Over 1.3m vehicles were sold in the current financial period. In addition, the Group operates at over 200 locations to support the Vehicle Buying division. As large numbers of vehicles are stored and prepared for sale at these sites and at the physical auctions, members of the public and the Group’s employees come into close contact with vehicles as they move to and from the auction hall. Furthermore, the Group’s employed and contracted drivers collect and deliver vehicles across both the UK and continental Europe and operate a fleet of over 740 vehicle transporters. Consequently, the Group’s operations are subject to regulations requiring adequate precautions to prevent injuries arising from collisions and impacts with vehicles moving within the Group’s locations and on public roads.

The Group is committed to providing a safe working environment wherever it operates, employing a proactive network of health and safety personnel covering all locations that share knowledge and experience with the aim of fostering best practice and ensuring consistently high standards of safety across the Group. Health & Safety Managers and committees are responsible for monitoring and reporting adherence to the Group’s health and safety protocols to the HASEC committee which ultimately reports on health and safety matters to the Board.

Our communityThe Group is conscious that it operates within the automotive community. As part of its commitment to this it works with BEN, a not-for-profit organisation, dedicated to making positive differences to people’s lives, helping those from the automotive industry and their families deal with any problems they may be facing. BEN provides a wide range of free confidential information, advice and support services, including highly-regarded care centres at various locations throughout the UK.

The Strategic report (which comprises the Business highlights, the Executive Chairman’s statement, BCA Marketplace, Strategy, Market overview, Business model, Operating review, Risk management and Corporate responsibility sections) is approved by the Board of Directors and signed on its behalf by:

Avril Palmer-Baunack Tim LampertExecutive Chairman Chief Financial Officer26 June 2017


Stephen Gutteridge Senior Independent

Non-Executive Director Date of appointment to Board

27 August 2015

Committee membershipA RN

Stephen has an extensive range of industrial and public company

experience both as an Executive and Non-Executive Director across the oil and gas, utilities, packaging, training and education sectors. He

held the roles of Chairman at Nighthawk Energy plc between

2011 and 2014, at President Energy plc between 2007 and 2011 and

also at Star Energy Group plc from its IPO through to its acquisition by

Petronas. Stephen’s executive experience includes his role as

Managing Director of Supply at Seeboard plc during its time as a

£1.5bn publicly-listed utility company. Stephen is currently a

Non-Executive Director of Fulcrum Utility Services plc.

Avril Palmer-BaunackExecutive Chairman

Date of appointment to Board 4 July 2014

Avril has over 20 years of executive experience with leading businesses

in the UK automotive, support services, industrial engineering and insurance services sectors. Through a number of high profile industry

roles, Avril has acquired significant experience of delivering operational

improvements and implementing business turnarounds, executing organic and acquisitive growth strategies and a track record of delivering shareholder value in a

public environment.

Avril has also held a broad range of executive roles throughout the

automotive industry, with experience in companies engaged

in vehicle salvage, car hire, auctions, transportation, distribution,

logistics, vehicle processing and infrastructure.

Avril was previously Executive Chairman and Deputy CEO of Stobart Group plc, one of the

largest British multimodal logistics companies with interests in transport, distribution and

infrastructure. Prior to this Avril was CEO of Autologic Holdings Plc, the

largest finished vehicle logistics company in the UK and Europe. She

joined Autologic from Universal Salvage Plc, where she held the

position of CEO from March 2005 until the sale of the company to

Copart UK Ltd in June 2007.

Avril is also currently Non-Executive Chairman of Redde plc.

Tim Lampert Chief Financial Officer

Date of appointment to Board 30 September 2015

Tim started his career in manufacturing companies before

joining a division of Bombardier Inc. in finance roles in the UK and the Middle East. He joined Autologic

Holdings Plc in 1997 and held various roles including Finance,

Logistics, Projects and Managing Director. He was also involved in

a number of acquisitions and disposals and, ultimately, the

successful sale of this company. Tim was instrumental in the

acquisition of the BCA Group and has a wide range of experience of the requirements of growth for

large businesses. Tim is a fellow of the Association of Chartered

Certified Accountants.

Board of Directors

Governance

A A

R R

N N

Committee membership key:

Audit & Risk Committee Member

Nomination Committee Member

Remuneration Committee Member

Committee Chair

Committee Chair

Committee Chair

Mark Brangstrup Watts Non-Executive

Director Date of appointment to Board

4 July 2014


Mark Brangstrup Watts founded Marwyn, the asset management and corporate finance group, in

2002 with James Corsellis. Mark is joint managing partner of Marwyn

Capital LLP, which provides corporate finance advice, and

Marwyn Investment Management LLP, which provides asset

management solutions and investment advisory services. Mark

is a Director of Marwyn Asset Management Limited, a regulated fund manager, and is also a trustee

of the Marwyn Trust.

Mark has held board positions on several Official List and AIM listed

companies, including Entertainment One Limited, Advanced Computer Software plc, Inspicio plc, Melorio

plc and Talarius plc, amongst others. Mark is currently a

Non-Executive Director of Zegona Communications plc and an Executive Director of Gloo

Networks plc, Safe Harbour Holdings plc, Wilmcote Holdings plc

and Le Chameau Group plc.


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Piet Coelewij Independent


27 August 2015

Committee membership A RN

Piet is a multilingual Dutch national who has an extensive international

background and a proven track record of leading growth businesses

in innovative and disruptive business environments. Piet is CEO of Wehkamp, the leading online

department store in the Netherlands. Prior to that

appointment, Piet was Vice President of Global Operations of US-based Sonos, a wireless HiFi

equipment manufacturer, and he has also held senior positions at Amazon.com in the UK between

2007 and 2011 and at Phillips Consumer Electronics in China

between 2004 and 2006.

Piet is an independent Non-Executive Director of Displaydata

Limited, a UK based privately owned technology company.

Piet’s extensive digital experience and background will support the

Group’s digital growth opportunities.

James Corsellis Non-Executive

Director Date of appointment to Board

4 July 2014


James Corsellis founded Marwyn, the asset management and

corporate finance group, in 2002 with Mark Brangstrup Watts. James

is joint managing partner of Marwyn Capital LLP, which provides

corporate finance advice, and Marwyn Investment Management

LLP, which provides asset management solutions and

investment advisory services. James is a Director of Marwyn Asset

Management Limited, a regulated fund manager, and is also a trustee

of the Marwyn Trust.

James has held board positions on several Official List and AIM listed companies, including as Chairman of Entertainment One Limited and Director of Breedon Aggregates

Limited and Concateno plc, amongst others. James is currently

an Executive Director of Gloo Networks plc, Safe Harbour

Holdings plc, Wilmcote Holdings plc and Le Chameau Group plc.

David LisIndependent

Non-Executive DirectorDate of appointment to Board

28 June 2016


David Lis was Chief Investment Officer, Equities and Multi Assets,

of Aviva Investors before his retirement in March 2016. David

began his career as an investment analyst at NatWest, following which

he became a fund manager at J Rothschild Investment

Management and Morgan Grenfell & Co Limited. David founded

Windsor Investment Management LLC, serving as managing director until its acquisition by RBS fund

management arm, Capitol House Limited. David joined Norwich

Union Investment Management Limited in 1997 (later merging to

form Aviva Investors), before becoming Head of Equities in 2012 and subsequently Chief Investment Officer, Equities and Multi Assets.

David is a Non-Executive Director of Melrose Industries plc and Electra Private Equity plc. David is also a Director of The Investor Forum, a body launched in 2014 with the

backing of the National Association of Pension Funds, the Association

of British Insurers and the Investment Association, which aims to promote the value of long-term

investment by facilitating better engagement between UK public

companies and their shareholders.

Jon Kamaluddin Independent


27 August 2015


Jon is a fellow of the Institute of Chartered Accountants and has a

strong background in finance, retail and e-commerce. Jon was, until

October 2013, International Director of ASOS plc, having also held the role of Finance Director and Company Secretary between

2004 and 2009. He was instrumental to ASOS plc’s

significant growth and led its global expansion. Jon served on

the ASOS main board throughout his tenure, during which time

ASOS market capitalisation grew from £30m to £4bn. Jon is the Senior Independent Director at FarFetch.com, a leading luxury clothing marketplace and Non

Executive Chairman of Klarna, a privately owned digital payments

business in Stockholm.


Executive Chairman’s governance statement

Governance continued

“We have established a Board that has a well-balanced array of skills and is well-attuned to the Group’s requirements.”

Avril Palmer-BaunackExecutive Chairman

Dear ShareholderOn behalf of the Board, I am pleased to present our Governance report for the financial year ended 2 April 2017. As Executive Chairman, it is my responsibility to ensure that the Group is and continues to be governed and managed with transparency and in the best interests of stakeholders.

In the last 12 months the Board has continued its drive to improve the existing governance structures and to enhance the internal control systems, policies and procedures to ensure they are appropriate for a company of our size and complexity.

Whilst the Company is not required to comply or explain any non-compliance with the UK Corporate Governance Code (September 2014) (the ‘Code’) as amended from time to time, for as long as it has a Standard Listing, the Company is committed to, and recognises the value and importance of, high standards of corporate governance. In due course and in any event prior to admission to the Premium segment of the Official List, the Board intends to comply as far as appropriate with the Code. A full version of the Code can be found on the Financial Reporting Council’s website http://www.frc.org.uk

The Code recommends that an evaluation of the effectiveness of the Board and its Committees is conducted annually and that this process is facilitated externally at least every third year. This year the evaluation process was carried out internally and required each Director to respond to a series of questions devised by the Company Secretary and agreed with me. The process considered the Board and its Committees’ composition, strengths and weaknesses, range and balance of skills, experience, independence and knowledge of the Company, diversity (including gender diversity), how the Board works together as a unit, risk management, succession planning and any training issues. The Board has considered the results of these evaluations and will take steps to address any required improvements.

As referred to in the Executive Chairman’s Statement on page 3, we have added an additional Independent Non-Executive Director to the Board and each of its Committees. This builds on the objectivity and independence strengthening work that I reported to you in the 2016 report and accounts. Consequently, the Directors consider that the Board has a well-balanced array of skills and remains well-attuned to the Group’s requirements.

This year we have welcomed the Paragon and Supreme Wheels businesses to the Group and, as stated in last year’s report, we will continue to focus on improving our standards of corporate governance across the whole of our business.

We are committed to maintaining an active dialogue with our shareholders and will hold our AGM on 7 September 2017 at the offices of Berwin Leighton Paisner LLP, Adelaide House, London Bridge, London EC4R 9HA.

Avril Palmer-BaunackExecutive Chairman26 June 2017

BCA core valuesThe Group’s business objectives include operating to high standards of ethical behaviour. To support those objectives, we aim for excellence in what we do through the application of the following core values:

• We are honest and act with integrity• Our customers are at the heart of our business• We are open for business with a “can do” attitude• We are innovative• We co-operate with and motivate each other• We treat our colleagues with respect• We are proud of our business and our achievements

but we act modestly


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Governance report

The role of the BoardThe Company is controlled by the Board of Directors on behalf of the Company’s shareholders and provides leadership of the Company. Matters reserved for the Board include setting strategy, approving budgets and financial statements and setting up key policies. Other matters are delegated to the Board committees. Day-to-day operational matters are delegated to the Executive Directors and the Group’s divisional operating boards. The Board held ten full meetings in the year to 2 April 2017 and attendance is summarised on page 48. The Board meetings consider business and financial performance, updates on key programmes within the business, strategic considerations, periodic risk assessments, reports from Board committees and legal and investor relations feedback.

Board compositionThe Board at the date of this report consists of four Independent Non-Executive Directors, two Non-Executive Directors and two Executive Directors, including an Executive Chairman.

The Code recommends that the role of Chairman and Chief Executive should not be exercised by the same individual. Avril Palmer-Baunack continues to hold the role of Executive Chairman. Avril has significant and unique expertise, knowledge and industry relationships in the UK and Europe which continues to contribute to the successful acquisition and management of businesses by the Company in accordance with its stated strategy to develop a range of automotive service solutions that enable the Group to add value along the vehicle supply chain. In light of this proven expertise the Board continues to believe that combining the roles of Chairman and Chief Executive remains the right approach at this stage in the Group’s development.

James Corsellis and Mark Brangstrup Watts have been Non-Executive Directors of the Company since its formation and, through their position as managing partners of Marwyn, were heavily involved in the Company’s acquisition of the BCA Group. As noted in the Directors’ remuneration report, both have an ongoing interest in the H.I.J. scheme and, as a result, they are not considered by the Board to be independent. Notwithstanding this, the Group meets the Code’s requirement that at least half of the Board should comprise Independent Non-Executive Directors.

Committees of the BoardThe Board has three Committees, namely the Audit & Risk Committee, the Remuneration Committee and the Nomination Committee, to carry out certain tasks on its behalf. The full terms of reference for each Committee are available on the Company’s website (www.bcamarketplaceplc.com) under Corporate Governance and from the Company Secretary on request.

Audit & Risk Nomination Remuneration

Role and terms of reference Reviews and reports to the Board on the Group’s financial and narrative reporting, internal controls and risk management systems, compliance, whistleblowing and fraud, and internal and external audit

Reviews the structure, size and composition of the Board and its Committees and makes appropriate recommendations to the Board. Considers succession planning for the Executive Directors

Responsible for all elements of the remuneration of the Executive Directors

Chairman Jon Kamaluddin James Corsellis Mark Brangstrup Watts

Members Stephen GutteridgeMark Brangstrup WattsPiet CoelewijJames CorsellisDavid Lis

Stephen GutteridgeMark Brangstrup WattsPiet CoelewijJon KamaluddinDavid Lis

Stephen GutteridgePiet CoelewijJames CorsellisJon KamaluddinDavid Lis

Committee report on pages 49 – 50 51 52 – 60

The Chairman of each Committee provides a report or update of each meeting of the respective Committee to the Board at the subsequent Board meeting.


Board and Committee membership and attendance The attendance of Directors at Board and Committee meetings of which they were members from 4 April 2016 to 2 April 2017 is set out below:

Full Board Audit & Risk Remuneration Nomination

Total number of meetings 10 3 3 1

Avril Palmer-Baunack 10 * * *Tim Lampert 10 * * *Stephen Gutteridge 10 3 3 1Mark Brangstrup Watts 9 1 3 1Piet Coelewij 10 3 3 1James Corsellis 10 2 3 1Jon Kamaluddin 10 3 3 1David Lis1 6 2 2 –

1 David Lis was appointed to the Board on 28 June 2016

* Avril Palmer-Baunack and Tim Lampert attended these meetings by invitation

The Board also held a number of further meetings to approve procedural matters.

Biographies of all the members of the Board appear on pages 44 to 45.

Advice and supportThe Directors may take independent professional advice at the Company’s expense provided that they give notice to the Executive Chairman.

Board evaluationKnowing where the Board performs well and where it can improve is a key part of ensuring ongoing improvement and effectiveness. An evaluation of the Board and its Committees has been carried out in the current period as referred to on page 46. A thorough review of the Board’s processes, practice and culture will be conducted on an annual basis.

Relations with shareholdersThe Board is committed to providing good communication channels with shareholders. The Executive Directors and our manager of investor relations are in regular contact with our main shareholders to ensure their views on the Company are known and discussed. We aim to keep shareholders abreast of Group developments through press releases and trading and other statements, together with formal reporting of the interim and full year results. We host shareholder visits to our operations to enable shareholders to gain a better understanding of our business, and regularly partake in investor roadshows. An investor relations report is presented at Board meetings to ensure all aspects of shareholder communication, changes in holdings and price movements are discussed. The website offers a readily available source of Company information, from trade press releases to formal Stock Exchange announcements and other key financial documents.

Governance report



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Audit & Risk Committee report

Dear ShareholderI am pleased to present the 2017 Audit & Risk Committee report.

The Audit & Risk Committee acts on behalf of the Board and on your behalf as shareholders, to ensure the integrity of the Group’s financial reporting, evaluate its system of risk management and internal control, and oversee the performance of the internal and external auditors.

Following his appointment as an additional Independent Non-Executive Director on 28 June 2016, David Lis joined the Audit and Risk Committee, further strengthening the independence of the Committee. I am happy to report that the Committee membership continues to comply with the UK Corporate Governance Code and related guidance, with all members being Non-Executive Directors and the majority being Independent but also maintains the sound range of financial and commercial expertise required to fulfil its role effectively.

During the year, the Committee has met to consider the interim results announcement, the planning of the audit process and its effectiveness, the Group’s relationship with the external auditor and has undertaken regular reviews of the Group’s internal controls and risk management systems.

Internal control and risk management systems in relation to the financial reporting processThe Board acknowledges its responsibility for establishing and maintaining the Group’s system of internal controls and delegates responsibility for monitoring the effectiveness of this to the Audit & Risk Committee. The Audit & Risk Committee reviews the system of internal controls through reports received from management, along with others from the external auditor.

The system of internal controls is designed to manage, rather than eliminate, the risk of failure to achieve business objectives and can provide only reasonable and not absolute assurance against material misstatement or loss.

The Group’s risk management process has been embedded into the enlarged operations of the business. Risks are identified and reviewed at operational, functional and Group levels culminating in a Group risk register, which identifies the risk area, the probability of the risk occurring, the impact if it does occur and the actions being taken to manage the risk to the desired level. The principal risks and uncertainties facing the Group are set out on pages 39 to 41.

In respect of financial reporting, monthly consolidated management accounts provide relevant, reliable and up-to-date financial and non-financial information to management and are summarised in the Chief Financial Officer’s report to the Board which analyses the differences between actual and budgeted results on a monthly basis. Annual plans, forecasts, performance targets and long-range financial plans allow management to monitor the key business and financial activities, and progress towards achieving the financial objectives. The annual budget is approved by the Board.

There are formal policies and procedures in place which ensure the integrity and accuracy of the accounting records and serve to safeguard the Group’s assets. These have been reviewed and updated during the year, aligning the policies and procedures across the enlarged Group. There are formal procedures by which staff can, in confidence, raise concerns about possible improprieties in financial administration and other matters, under the Group’s whistleblowing policy.

The Committee receives regular reports from management regarding monitoring of these controls, and assures itself that the internal control environment of the Group is operating effectively.

Annual Report and AccountsThe Committee met during the year to review and approve the Annual Report and Accounts for the prior year, the interim financial statements and the plan for this Annual Report and Accounts. The Committee has also met once since the year end to approve this Annual Report and Accounts. In reviewing the financial statements with management and the auditor, the critical accounting judgements and key sources of estimation and uncertainty set out in note 3 to the financial statements have been discussed and debated. As a result of our review, the following items have been identified that require particular judgement or have significant potential impact on the interpretation of this Annual Report and Accounts:


Significant issue How addressed

Valuation of intangibles The Group undertook a Purchase Price Allocation exercise using experience gained working with external specialists in the prior year to identify and value the acquired intangible assets. Management reviewed the assumptions.

Impairment of goodwill and intangible assets Consideration has been given to management’s assumptions, in particular in relation to future trading and the current discount rate, used to support the carrying value of goodwill and intangible assets.

Significant or non-recurring items Consideration has been given to management’s classification of items as significant or non-recurring, in particular in relation to acquisition and other significant items.

Share based payments and pension benefits In conjunction with the advice of relevant specialists, consideration was given to the specific circumstances of the arrangements and the requirements of the associated standards in relation to management’s calculation and the presentation of the share based payment and pension arrangements.

Arrangement fees Management assessed the refinance using qualitative factors including the reduction in restrictive clauses in the loan agreement, the proportion of senior debt compared to revolving credit facility and the reduced risk profile of the Group (see accounting policy o on page 75). It was determined that the new facility was an extinguishment and refinance and as such the previous facility arrangement fee costs were written off.

Further details of the accounting policies, judgements, estimates and non-GAAP measures are given on pages 71 to 78.

The Committee has reviewed the judgements made in these areas by management and, after due challenge and debate, was content with the assumptions made and the judgements applied.

Internal auditThe Group has an in-house internal audit function which focuses on operational processes and controls.

External auditThe Audit & Risk Committee is responsible for monitoring the performance, objectivity and independence of the Group’s auditor PricewaterhouseCoopers LLP (‘PwC’). PwC have been external auditor to the Company since its formation in 2014 and were also auditor to the acquired BCA Group. In assessing the effectiveness of the external audit process, the Committee has considered:• the external audit plan, including the key audit risk areas, materiality and significant judgement areas;• the terms of the audit engagement letter and the associated level of audit fees;• management’s feedback on the external audit process; and• the independence of the external auditor including a review of the non-audit services provided.

On the basis of this, it was concluded that it was in the best interests of the Company to recommend the re-appointment of PwC as auditor for the forthcoming year. The resolution to re-appoint PwC will propose that they hold office until the conclusion of the next AGM at which accounts are laid before the Company, at a level of remuneration to be determined by the Directors. The Audit & Risk Committee has reviewed the remuneration received by PwC for non-audit work conducted during the financial period which is detailed in note 10 to the financial statements on page 86 and note that there were non-audit fees incurred in the year of £0.1m relating to a review and recommend over our existing ethics and compliance policies.

Jon Kamaluddin, FCAChairman, Audit & Risk Committee26 June 2017

Audit & Risk Committee report



FinancialsG


Nomination Committee report

Dear ShareholderI am pleased to provide the report of the Nomination Committee for 2017. The purpose of the Committee is to ensure that there is a formal and transparent procedure for the appointment of new Directors to the Board. Our duties include reviewing the Board’s structure, size and composition, including the skills, knowledge and experience the Board has and may need. Following this review we then make appropriate recommendations to the Board, taking into account succession planning for Directors, the Group’s challenges and opportunities and with due regard for the benefits of diversity. Our policy is to ensure that the best candidate is selected to join the Board and this approach will remain in place going forward, without prescriptive or quantitative targets.

The members of the Committee are shown on page 47. As recommended by the Code, the Committee is comprised of a majority of Independent Non-Executive Directors. The Executive Directors attend the Committee by invitation where it is appropriate for them to do so.

The Committee met on 28 June 2016 to evaluate and recommend the appointment of David Lis as an Independent Non-Executive Director to the Board for a period of three years, subject to annual re-election at the AGM. David’s appointment followed an objective assessment of the Group’s needs and strategy and the Board’s skills and experience, and involved a thorough search with the assistance of one of the world’s leading global executive search firms, Korn Ferry, with whom the Group has no other relationship.

The Committee has also reviewed the composition of the three Committees of the Board. The membership of the Remuneration and the Audit & Risk Committees, as shown on page 47, also fulfil the requirements of the Code being comprised of at least three Independent Non-Executive Directors.

On Admission to the Main List and in the absence of any Independent Non-Executive Directors, Mark Brangstrup Watts and I were appointed to the three Committees. Whilst the requirement for three Independent Non-Executive Directors is satisfied, in order to take advantage of the knowledge of the strategic direction of the Group and of the acquired businesses, the Committee recommended, and the Board agreed, that Mark and I should remain on these Committees and, given the stage of the Group’s development, that Mark would continue to chair the Remuneration Committee. In so doing, ongoing continuity has not been lost.

The Code states that the Nomination Committee should be chaired by an Independent Non-Executive Director. For similar reasons to those discussed in the paragraph above, the Committee recommended, and the Board agreed, that I should remain as Chairman of the Nomination Committee.

Board induction and training An induction programme is arranged for new Non-Executive Directors that includes a comprehensive pack of information on the Group, meetings with senior management and other Board members, visits to a number of the Group’s sites and briefings to share the Group’s strategy.

The Directors also have access to ongoing training as required.

On the recommendation of the Committee all Directors will offer themselves for re-election at the forthcoming AGM.

James CorsellisChairman, Nomination Committee26 June 2017


Annual statement by the chairman of the Remuneration Committee


Dear ShareholderOn behalf of the Board, I am pleased to present the Remuneration Committee’s report for the year ended 2 April 2017.

Last year, the Remuneration Committee (the ‘Committee’) developed the Company’s remuneration policy, building upon the foundations laid down by the Executive incentive scheme which was agreed with shareholders as part of the process to acquire the BCA Group. The Committee believes that this policy provides the most appropriate remuneration structure to motivate its Directors in a manner consistent with the objectives of the shareholders. This policy was subject to a binding vote and was approved by shareholders at the 2016 AGM. The policy was adopted by the Company immediately. No changes are proposed to this policy and a summary of its key components are set out on pages 58 to 60.

The Group reported strong profits for the year and completed strategic acquisitions that increase the breadth of services offered and enhance the development of the Group. Consequently, the performance criteria of the annual incentive scheme were satisfied in full and the Executive incentive scheme, originally issued in 2014 but not yet vested, remains relevant and a strong motivational tool for the Directors. The Annual report on remuneration which provides details of Directors remuneration for the year is set out on pages 53 to 57.

On 28 June 2016, we welcomed David Lis to the Board. David’s remuneration was agreed in line with the remuneration policy consistent with other Non-Executive Directors. Otherwise, the Board has been stable throughout the year. During the year the Committee considered the level of pension contributions payable to the Executive Directors in light of the tapered annual allowance introduced in April 2016. The Committee exercised its discretion such that once pension contributions equal to the tapered annual allowance had been made, each Executive Director should receive taxable pay in lieu of pension contributions such that the net amount received, after deductions, were the same as would have been the case before the introduction of the tapered annual allowance. In taking this view, the Committee considers that each Executive Director has received their pension benefits in line with their service contracts and in line with the Company’s Remuneration Policy.

The Committee met three times during the year and in March it agreed remuneration changes for the forthcoming year, in line with the remuneration policy. Salaries for Executive Directors and fees for Non-Executive Directors for the forthcoming year will not be increased. The annual performance target will be based 100% on the Group’s underlying profitability. No further long-term incentives will be awarded; the existing scheme remains in place and continues to be relevant and appropriate. Subject to meeting the performance criteria, which are set out on page 54-55, this scheme may vest in November 2017.

The Committee is satisfied that the current remuneration packages in place continue to be appropriate and is mindful that this will need to be kept under review during the course of 2017.

Mark Brangstrup WattsChairman, Remuneration Committee26 June 2017


FinancialsG


Annual report on remuneration

The information provided in this Annual report on remuneration, on pages 52 to 57, is subject to audit except where indicated otherwise.

Executive Directors’ remunerationFor the year ended 2 April 2017 For the 15 months ended 3 April 2016

Salary£’000

Taxable benefits3

£’000

Annual incentives

£’000Pension4

£’000Total£’000

Salary£’000

Taxable benefits3

£’000

Completion bonus5

£’000

Annual incentives

£’000Pension4

£’000Total

£’000

Avril Palmer-Baunack 485 53 485 75 1,098 547 50 6,044 485 48 7,174Tim Lampert1 320 40 320 52 732 135 16 – 135 14 300Spencer Lock2 – – – – – 147 13 – 150 – 310

1 Tim Lampert was appointed as a Director on 30 September 2015 and his remuneration in the comparative period therefore represents the six months ended 3 April 20162 Spencer Lock resigned on 30 September 2015 3 The Directors each had use of a fully expensed company car and received private medical insurance and life insurance4 Includes amounts paid into money purchase personal pension plans and taxable payments made in lieu of pension contributions5 Avril Palmer-Baunack’s service agreement contained a bonus arrangement which was dependent on the completion of the first acquisition of a trading business or company

by the Group. Once this condition was satisfied Avril was entitled to an amount equal to 0.5% of the enterprise value of the transaction and as such, as a consequence of the acquisition of the BCA Group, Avril was entitled to a completion bonus of £6,044,000

Annual incentive schemeThe Executive Directors participate in an incentive scheme, payable in cash, in which the minimum annual incentive payable is nil and the maximum is 100% of relevant salaries. The Remuneration Committee based the incentives entirely on the achievement of Group profitability targets, set from the three-year plan created for the acquisition of the BCA Group. This target was chosen as Group profitability is currently identified as the key driver to shareholder value and the most appropriate measure of annual performance. The target was achieved in full.

PensionPension contributions are set at an underlying level of 10% of salary and include payments made into money purchase pension plans and taxable payments made in lieu of pension contributions. Pension contributions into money purchase pension plans were made below or at the level of the tapered annual allowance. Above that level, Executive Directors receive taxable pay in lieu of pension contributions such that the net amount received, after deductions, is the same as would have been the case before the introduction of the tapered annual allowance.

Non-Executive Directors’ remunerationFor the year

ended 2 April 2017

Fees£’000

For the 15 months ended

3 April 2016Fees

£’000

Mark Brangstrup Watts 50 50Piet Coelewij1 50 30James Corsellis 50 50Stephen Gutteridge1 50 30Jon Kamaluddin1 60 36David Lis2 38 –

1 Stephen Gutteridge, Jon Kamaluddin and Piet Coelewij were each appointed on 27 August 2015 and their remuneration in the comparative period therefore represents the seven months ended 3 April 2016

2 David Lis was appointed on 28 June 2016 and therefore his remuneration represents the nine months ended 2 April 2017

Directors’ interest in shares and share optionsInterest in Ordinary shares

at the start and end of the year

Interest in H.I.J. scheme at the start and end of the year

(unvested)

At 2 April 2017number




Avril Palmer-Baunack 707,657 666,667 303,923 303,923Tim Lampert 19,232 – 26,654 26,654Funds managed by Marwyn Asset Management Ltd1 20,941,110 18,541,110 – –Marwyn Long Term Incentive LP2 – – 202,500 202,500Stephen Gutteridge 25,000 – – –Piet Coelewij 86,000 – – –David Lis 100,000 – – –

1 James Corsellis and Mark Brangstrup Watts ultimately own and are Non-Executive Directors of Marwyn Asset Management Limited2 Marwyn Long Term Incentive LP is a partnership in which James Corsellis and Mark Brangstrup Watts have a beneficial interest

No other Director holds, or held at any time during the year, a beneficial interest in the Company’s Ordinary shares.


Long-term incentive scheme – the H.I.J. schemeNo changes have been made to the Company’s long-term incentive scheme during the current year. This incentive scheme was created prior to the acquisition of the BCA Group to reward Directors for the creation of value for shareholders, once all investors have received a preferential level of return. In order to make these arrangements most efficient, they were based around a subscription for shares in H.I.J. Limited (‘the H.I.J. shares’), a wholly owned subsidiary of BCA Marketplace plc.

The Directors subscribe for H.I.J. shares, which are subject to a number of conditions, as detailed below. If these conditions have been met, the holders of H.I.J. shares can give a redemption notice to the Company. On being presented with such a notice, the Company may purchase the H.I.J. shares either for cash or for the issue of new Ordinary shares at its discretion, at a value as described below.

Growth conditionThe growth condition is the compound annual growth rate of the invested capital in the Company being equal to or greater than 10% per annum. The growth condition takes into account the date and price at which shares in the Company have been issued, the date and price of any subsequent share issues and the date and amount of any dividends paid or capital returned by the Company to its shareholders.

Vesting conditionThe H.I.J. shares are subject to certain vesting conditions, at least one of which must be, and continue to be, satisfied in order for a holder of H.I.J. shares to exercise their redemption rights and which ends on 10 November 2019. The vesting conditions are as follows:

(i) a sale of all or a material part of the business of H.I.J. Ltd;(ii) a sale of all of the issued Ordinary shares of H.I.J. Ltd occurring;(iii) a winding up of H.I.J. Ltd occurring;(iv) a sale or change of control of the Company; or(v) it is later than the third anniversary of AIM Admission (which was 10 November 2014).

The Directors have agreed that if they cease to be involved with the Company in the first three years following AIM Admission then in certain circumstances a proportion of their H.I.J. shares may be forfeited.

Compulsory redemptionIf the growth condition is not satisfied on or before the fifth anniversary of AIM Admission or such later date as the Company and holders of 66% of all the H.I.J. shares agree, the H.I.J. shares must be sold to the Company or, at its election, redeemed, in both cases at a price equal to the subscription price per H.I.J. share. Subsequently, if there is a sale of the business within a period of one year of the fifth anniversary, which would otherwise have satisfied the conditions, the holders of the H.I.J. shares will be entitled to receive an amount calculated in accordance with the award.

Redemption valueSubject to the provisions detailed above, the H.I.J. shares can each be sold to the Company for a proportion of an aggregate value up to the Incentive Scheme Cap.

Under the Incentive Scheme Cap, the value of awards under all of the Company’s share incentive arrangements will not, at the point of vesting or over a ten year period, exceed 10% of the excess of the market value of the Company (based on a 30 day volume-weighted average mid-market price and taking dividends and any prior return of capital into account) over and above the aggregate placing price paid by shareholders for its share capital (the ‘10% growth’).

The effect of the Incentive Scheme Cap is that if there are no other share incentive schemes with any potential value at the time that the H.I.J. shares vest, then the aggregate value of the H.I.J. shares will be all of the 10% growth. If other share incentive arrangements are in place, the potential value of those arrangements will be deducted from the value attributed to the H.I.J. shares, such that the aggregate value of those arrangements together with the H.I.J. shares does not exceed the 10% growth.




FinancialsG


Awards under the H.I.J. scheme No awards have been made during the current year and none of the H.I.J. shares have been forfeited, exercised or expired. Details of the awards made to date under the H.I.J. scheme, together with the number outstanding at 2 April 2017, are shown below:

Current participation in the 10% Growth1

Date of award Minimum Maximum Issue price NumberSubscription

value

11 July 2014 £0.01 202,500 £2,02515 June 2015 £0.05 101,423 £5,071

Avril Palmer-Baunack Aggregate holding 4.85% 5.70% 303,923 £7,096Tim Lampert 22 October 2015 0.42% 0.50% £0.07 26,654 £1,999Marwyn Long Term Incentive LP2 11 July 2014 3.23% 3.80% £0.01 202,500 £2,025

Total 8.50% 10.00% 533,077

1 At 2 April 2017 other share incentive arrangements were in place which may entitle the holders up to 1.5% of the 10% Growth. These awards are subject to separate performance conditions and it is possible that no award could be made under these arrangements. These are disclosed in note 29 to the financial statements

2 Marwyn Long Term Incentive LP is a partnership in which James Corsellis and Mark Brangstrup Watts are limited partners

Payments to past DirectorsNo additional payments have been made to past Directors in the current year.

During the comparative period to 3 April 2016, Spencer Lock resigned as a Director on 30 September 2015 but remained as Group Managing Director until 31 March 2016 when he left the business subject to a 12 month notice period included in his service agreement. For completeness, the table below shows the total amounts paid by the Company to Spencer Lock since he resigned from the Board on 30 September 2015, all of which was accounted for and disclosed in the comparative period:

For the 15 months ended 3 April 2016

Salary£’000

Payment in lieu of notice

£’000

All taxable benefits

£’000

Annual incentive scheme1

£’000

Payment in lieu of pension

contributions2

£’000Total

£’000

Spencer Lock 150 300 12 150 66 678

1 In respect of the period from 1 October 2015 to 3 April 2016, excluding the amount included in the table of Executive Directors’ remuneration above, which is in respect of services between 2 April 2015 and 30 September 2015

2 Representing payment of taxable income in lieu of pension contributions

The following disclosures in the Annual report on remuneration are not subject to audit.

Contracts of service and letters of appointment

Executive Directors: contracts of service Date of appointment Date of contractNotice period

(months)Length of service at 26 June 2017

Avril Palmer-Baunack 4 July 2014 25 March 2015 121 3 yearsTim Lampert 30 September 2015 1 July 2015 121 1 year and 9 months

Non-Executive Directors: letters of appointment

James Corsellis 4 July 2014 25 March 2015 32 3 yearsMark Brangstrup Watts 4 July 2014 25 March 2015 32 3 yearsStephen Gutteridge 27 August 2015 10 August 2015 32 1 year and 10 monthsJon Kamaluddin 27 August 2015 21 August 2015 32 1 year and 10 monthsPiet Coelewij 27 August 2015 17 August 2015 32 1 year and 10 monthsDavid Lis 28 June 2016 28 June 2016 32 1 year

1 The Company has the option of making a payment in lieu of any unexpired notice period2 If not re-elected as a Director at an AGM the appointment is terminated with immediate effect and without compensation


Share priceThe chart illustrates the performance of an investment of £100 in the Company’s shares made on 2 April 2015, when the Company acquired the BCA Group and was admitted to trading on the Official List, which has been compared to the performance of the same investment on the same date in the FTSE 250 All Share Index. The Board believes this is the most appropriate broad equity market index with which to compare the Company’s performance.

140

BCA Marketplace plc

130

120

110

100

90

80

04/1506/15

08/1510/15

12/1502/16

04/1606/16

08/1610/16

12/1602/17

06/1704/17

FTSE 250

Executive Chairman’s total remuneration as a single figureThe table below sets out the Executive Chairman’s total remuneration as a single figure together with the percentage of their maximum annual incentive awarded over the same period as the chart above in respect of the Company’s share price.



Executive Chairman total remuneration (£’000) 1,098 1,068Annual incentive awarded (% of maximum) 100% 100%Share award vesting (% of maximum) None None

1 The single figure for total remuneration is for the year from 2 April 2015, the date that the BCA Group was acquired and the Company was admitted to trading on the Official list, to 3 April 2016. The remuneration of £1,068,000 excludes salary of £62,000 for the three months to 2 April 2015 and the completion bonus of £6,044,000 paid in respect of the acquisition of the BCA Group. This single figure for total remuneration provides a more meaningful comparison of remuneration in respect of the share price performance and is a more meaningful basis for comparison to future years. The single figure for total remuneration for the 15 month period to 3 April 2016 is £7,174,000

Percentage change in remuneration of the Executive ChairmanThe table below sets out the percentage change in salary, benefits and annual bonus for the Executive Chairman compared to all other employees.

Executive Chairman All employees

% change in base salary 0% 1.3%% change in benefits1 5.7% 0%% change in annual bonus 0% 5.1%

1 Increase for the Executive Chairman represents the assessed benefit in respect of a new car and the cost of providing medical and life insurance, rather than a change in the nature of benefits. The change shown for all employees represents the nature of benefits




FinancialsG


Relative importance of spend on payThe table below shows the relative importance of spend on pay for all employees in comparison to adjusted EBITDA and distributions to shareholders. Total employee pay includes wages and salaries, pension costs, social security and share-based payments.

For the year ended

2 April 2017£’m


3 April 2016 £’m % change

Total employee pay 222.4 157.2 41.5Adjusted EBITDA 135.6 98.5 37.7Distributions1 52.7 46.8 12.6

1 Distributions to shareholders include interim and final dividends paid and payable in respect of the financial period

Statement of voting at the Annual General Meeting At the 2016 AGM, shareholders voted to approve the Directors’ remuneration report and the Directors’ remuneration policy. All resolutions were passed unanimously on a show of hands. The table below shows a summary of the Proxy Forms received by the Registrars, appointing the Chairman of the AGM as proxy.

Directors’ remuneration report Directors’ remuneration policy

Number of votes % of votes cast Number of votes % of votes cast

Number of votes in favour 670,936,557 95.4% 613,664,657 87.2%Number of votes against 32,671,195 4.6% 89,943,095 12.8%Number of abstentions votes 125 125Total votes cast 703,607,877 100% 703,607,877 100%


The Directors’ remuneration policy (‘the Remuneration Policy’) was approved by shareholders at the 2016 AGM, and took immediate effect. No changes are proposed for the 2017/18 financial year and therefore shareholders will not be asked to vote on the Policy at the AGM this year.

An extract of the policy is provided below. The full policy can be found in the 2016 Annual Report, which is available on our website.

Remuneration packages for Executive Directors

Base salary

Purpose and link to strategy Designed to attract, retain and motivate, whilst remaining competitive.

Operation and performance conditions Takes into account the role performed by the individual and information on the rates of pay for similar jobs in companies of comparable size and complexity.

Maximum opportunity Salary is reviewed annually and otherwise by exception. The Executive Directors’ salaries as at 3 April 2017 and the forthcoming financial year were:• Avril Palmer-Baunack: £485,000• Tim Lampert: £320,000

Performance assessment Salary is reviewed annually with effect from the start of each financial year and is determined by taking account of information on the rates of salary for similar jobs in companies of comparable size and complexity. Any changes to this basic salary will be made by taking into account additional responsibilities held by that individual, their performance and inflationary or general pay awards within the Group.

Benefits

Purpose and link to strategy Designed to provide benefits appropriate to the role, whilst remaining competitive.

Operation and performance conditions Benefits are provided to the Executive Directors in line with market practice.

Maximum opportunity Set at a level considered to be commensurate with the role and comparable with those provided in companies of a similar size and complexity.

Performance assessment Not applicable.

Pension

Purpose and link to strategy Designed to provide pension benefits commensurate to the role, whilst remaining competitive.

Operation and performance conditions Executive Directors may elect to receive pension contributions or a cash allowance in lieu of contributions.

Maximum opportunity Contributions are set at a level which the Remuneration Committee considers to be commensurate with the role and comparable with those provided in companies of a similar size and complexity.


Remuneration Policy (unaudited)



FinancialsG


Annual incentive scheme

Purpose and link to strategy Intended to reward for individual achievements and the performance of the Group in the financial year.

Operation and performance conditions The Remuneration Committee reviews performance against the objectives set under the scheme and determines awards accordingly.

Maximum opportunity Maximum of 100% of salary.

Performance assessment The targets against which annual performance is judged are primarily based on the Group’s underlying profitability and can include other strategic objectives.

Long-term incentive scheme

Purpose and link to strategy Intended to incentivise towards the long-term development of the Group.

Operation and performance conditions Under the existing scheme, awards were made in 2014 and 2015. The Remuneration Committee reviews the development of the Group against the terms of the scheme to ensure that it remains appropriate.

Maximum opportunity In aggregate for all participants in the scheme, a maximum of 10% of the growth in value of the Company, as described on pages 53 to 55.

Due to the long-term nature of the H.I.J. scheme, which only allows the Directors to receive benefits under that scheme once shareholders have experienced significant growth in the value of their investment and had an opportunity to realise that growth, there are no clawback arrangements in respect of awards.

Performance assessment The achievement of 10% Growth in total shareholder return, as defined on page 54.

Remuneration packages for Non-Executive Directors

Fees

Purpose and link to strategy To attract and retain Non-Executive Directors of the appropriate experience and calibre.

Operation and performance conditions The fees of Non-Executive Directors are determined by the Board based upon comparable market levels. Other than with the exception noted above in relation to the H.I.J. share scheme, the Non-Executive Directors do not participate in the Company’s incentive schemes and nor do they receive any benefits or pension contributions. Where Non-Executive Directors have the responsibility to chair a sub-committee they may be eligible to receive additional annual fees of £10,000.

Maximum opportunity Not applicable.



Share ownership guidelinesThere is no minimum shareholding requirement.

Other payments The Committee reserves the right to make payments outside the Remuneration Policy in exceptional circumstances. The Committee would only use this right where it believes that this is in the best interests of the Company and when it would be disproportionate to seek the specific approval of the shareholders in a general meeting.

Policy for payment on loss of officeThe service agreements for the Executive Directors allow for lawful termination of employment by making a payment in lieu of notice or by making phased payments over any remaining unexpired period of notice. At the discretion of the Committee, the rationale for which would be fully disclosed in the Annual report on remuneration, a pro-rata annual incentive may become payable at the normal payment date for the period of employment and based on full year performance. The Committee reserves the right to make additional liquidated damages payments outside the terms of the Directors’ service contracts.

RecruitmentWhen hiring a new Executive Director, the Committee will use the Remuneration Policy to determine the Executive Director’s remuneration package. To facilitate the hiring of candidates of the appropriate calibre to implement the Group’s strategy, the Committee may include any other remuneration component or award not explicitly referred to in this Remuneration Policy sufficient to attract the right candidate.

Outside appointmentsThe Company recognises that Executive Directors may be invited to become Non-Executive Directors of other companies and that this can help broaden the skills and experience of a Director. Executive Directors are permitted to take on other Non-Executive positions with other companies and to retain their fees in respect of such a position.

Upon appointment as the Executive Chairman of the Company Avril Palmer-Baunack was permitted to retain her existing Non-Executive Chairmanship of Redde plc and the associated annual remuneration of £200,000.

Remuneration Policy (unaudited)


Statement of consideration of employment conditions elsewhere in the GroupThe Group applies the same key principles to setting remuneration for its employees as those applied to the Directors’ remuneration. In setting salaries and benefits each business considers the need to retain and incentivise key employees to ensure the continued success of the Group. Employees of the Group were not consulted in setting the Remuneration policy.

Consideration of shareholder viewsThe Committee considers it extremely important to maintain open and transparent communication with the Company’s shareholders. The views of shareholders received through various avenues, such as at the AGM, during meetings with investors and through other contact during the year, are considered by the Committee and will help to inform the development of the overall Remuneration policy.


FinancialsG


BCA Marketplace plc is incorporated and registered in England with registered number 09019615. The address of the Company’s registered office is BCA Bedford, Coronation Business Park, Kempston Hardwick, Bedford MK43 9PR.

The Company’s accounting reference date is 31 March and its accounts are prepared to a Sunday within seven days of that date. This Annual Report therefore covers the year to 2 April 2017.

The report has been drawn up and presented in accordance with, and in reliance upon, applicable English Law and the liabilities of the Directors in preparing this report shall be subject to the limitations and restrictions provided by such law. The Directors’ report is designed to inform shareholders and help them assess how the Directors have performed their duty to promote the success of the Company.

Strategic report and corporate governanceThe Strategic report can be found on pages 1 to 43 and is included by reference into this Directors’ report. The Strategic report sets out the development and performance of the Group’s business during the financial year, the position of the Company at the end of the year, a description of the principal risks and uncertainties facing the Company, indications of future developments in the business, reporting of Greenhouse Gas Emissions and the Group’s Governance report.

DividendAn interim dividend of 2.20p per Ordinary share was paid to shareholders on the Register of members at the close of business on 16 December 2016. The Directors are recommending a final dividend for the year of 4.55p per Ordinary share which together with the interim dividend of 2.20p, makes a total for the year to 2 April 2017 of 6.75p, amounting to £52.7m. Subject to shareholder approval at the AGM on 7 September 2017, the final dividend will be paid on 29 September 2017 to shareholders on the Register of members at the close of business on 15 September 2017.

Share capital The shares in issue at the year-end comprised 780,247,192 (2016: 780,247,192) Ordinary shares of £0.01, giving a total nominal value of £7.8m (2016: £7.8m). The holders of Ordinary shares are entitled to receive dividends as declared from time to time, and are entitled, on a poll, to one vote per share at general meetings of the Company. Details of the Company’s share capital are shown in note 24 to the Group’s financial statements.

Powers of the Company DirectorsThe AGM in September 2016 granted the Directors the authority to allot shares up to a maximum nominal amount of £2.6m (being one third of the Company’s issued share capital at that date) plus a further £2.6m in connection with a rights issue. The AGM also granted the Directors the authority to make market purchases of shares up to 15% of the share capital of the Company within prescribed limits. These authorities were not exercised in the period.

Directors’ report

Substantial shareholdingsAs at 20 June 2017, the Directors had been advised of the following interests in the shares of the Company.

Substantial shareholders of 3% or more, as at 20 June 2017 Number of shares % shareholding

Invesco Asset Management 176,538,549 22.63Woodford Asset Management 117,527,144 15.06Capital Group Co 110,483,002 14.16Aviva Investors 108,914,993 13.96AXA Framlington Investment

Management33,716,667 4.32

Marwyn Asset Management Ltd 32,503,634 4.17Royal London Asset Management 25,388,400 3.25

It should be noted that these holdings may have changed since being notified to the Company. However, pursuant to Rule 5.1 of the Disclosure and Transparency Rules notification of any change is not required until the next applicable threshold is crossed.

Directors The Directors of the Company as at the date of this report are named on pages 44 to 45 together with their profiles.

All Directors who have served during the year and who remain a Director as at 2 April 2017 will retire and offer themselves for re-election at the forthcoming AGM. The interests of the Directors in the share capital of the Company at 2 April 2017, the Directors’ total remuneration for the year and details of their service contracts and letters of appointment are set out in the Remuneration Committee report on pages 52 to 60.

With the exception of the interest in H.I.J. shares disclosed on pages 53 to 55, no Directors have beneficial interests in the shares of any subsidiary company. In the period following 2 April 2017 to the date of this report, Stephen Gutteridge’s interest in shares increased by 5,000 shares and Funds managed by Marwyn Asset Management (see page 53) increased their shareholding by 11,562,524 shares.

Directors’ indemnitiesThe Company maintains Directors’ and officers’ liability insurance, which gives appropriate cover for legal action brought against its Directors and officers.

Directors’ conflicts of interestThe Group has procedures in place for managing conflicts of interest. Should a Director become aware that they, or their connected parties, have an interest in an existing or proposed transaction with the Group, they should notify the Board in writing or at the next Board meeting. Internal controls are in place to ensure that any related party transactions involving Directors, or their connected parties, are conducted on an arm’s length basis. Directors have a continuing duty to update any changes to these conflicts.

Significant agreements – change of controlThe Group’s term loan and revolving facility contain customary prepayment, cancellation and default provisions including, if required by a lender, mandatory prepayment of all utilisations provided by that lender upon the sale of all or substantially all of the business and assets of the Group or a change of control. The Company does not have agreements with any Director that would provide compensation for loss of office or employment resulting from a takeover except for provisions which may cause awards and options granted under such arrangements to vest on a takeover.


Corporate responsibilityThe Board considers that issues of corporate responsibility are important. The Board’s report, including the Group’s policies on employee involvement and disability, and a statement on Greenhouse Gas Emissions for the Group, is set out in the Corporate responsibility report on pages 42 and 43.

Political donationsDuring the year the Group did not make any donations to any political party or other political organisation and did not incur any political expenditure within the meaning of Sections 362 to 379 of the Companies Act 2006.

Events after the balance sheet dateAfter the balance sheet date, deferred consideration in respect of the Paragon acquisition was paid.

Annual General MeetingThe AGM of the Company will be held at the offices of Berwin Leighton Paisner LLP, Adelaide House, London Bridge, London EC4R 9HA at 9.30am on 7 September 2017.

The resolutions being proposed at the 2017 AGM are general in nature and include the receipt of the Annual Report and Accounts including the Remuneration report, the re-election of all the members of the Board, the re-appointment of the auditor, the renewal for a further year of the limited authority of the Directors to allot the unissued share capital of the Company and the disapplication of pre-emption rights, the renewal of the authority to make off-market purchases and the request for shareholder approval to reduce the notice period for calling general meetings (other than the AGM) to 14 clear days.

Going concernThe Group’s business activities, together with the factors likely to affect its future development, performance and position are set out on pages 1 to 43. The financial position of the Group, its cash flows, liquidity position and borrowing facilities are described in the ’Operating review’ section on pages 34 to 38. In addition, note 27 to the Group financial statements include the Group’s objectives, policies and processes for managing its capital, its financial risk management objectives, details of its financial instruments and its exposures to credit risk and liquidity risk. The Board has a reasonable expectation that the Company and Group have adequate resources to continue in operational existence for the foreseeable future and have therefore continued to adopt the going concern basis in preparing these financial statements.

Auditor PricewaterhouseCoopers LLP has confirmed its willingness to continue in office as auditor of the Group. In accordance with section 489 of the Companies Act 2006, separate resolutions for the re-appointment of PricewaterhouseCoopers LLP as auditor of the Group and for the Directors to determine their remuneration will be proposed at the forthcoming AGM of the Company.

Statement as to disclosure of information to auditorsThe Directors who held office at the date of approval of this Directors’ report confirm that, so far as they are each aware, there is no relevant audit information of which the Company’s auditor is unaware; and each Director has taken all the steps that they ought to have taken as a Director to make themselves aware of any relevant audit information and to establish that the Company’s auditor is aware of that information.

Responsibility statement of the Directors in respect of the Annual Report and AccountsWe confirm that to the best of our knowledge:

• the financial statements, prepared in accordance 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 the undertakings included in the consolidation taken as a whole; and

• the Strategic report includes a fair review of the development and performance of the business and the position of the issuer and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.

The Directors are responsible for preparing the Annual Report and the financial statements in accordance with applicable law and regulations.

Company law requires the Directors to prepare Group and Parent Company financial statements for each financial year. Under the law they are required to prepare the Group financial statements in accordance with International Financial Reporting Standards (‘IFRSs') as adopted by the EU and applicable law and have elected to prepare the Parent Company financial statements on the same basis.

Under company law the Directors must not approve the financial statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Parent Company and of their profit or loss for that period. In preparing each of the Group and Parent Company financial statements, the Directors are required to:

• select suitable accounting policies and then apply them consistently;

• make judgements and estimates that are reasonable and prudent;

• state whether they have been prepared in accordance with IFRSs as adopted by the EU; and

• prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Company will continue in business.

Directors’ report



FinancialsG


The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Parent Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Parent Company and enable them to ensure that its financial statements comply with the Companies Act 2006. They have general responsibility for taking such steps as are reasonably open to them to safeguard the assets of the Group and to prevent and detect fraud and other irregularities.

Under applicable law and regulations, the Directors are also responsible for preparing a Strategic report, Directors’ report, Directors’ remuneration report and Corporate Governance Statement that complies with the law and those regulations.

The Directors are responsible for the maintenance and integrity of the corporate and financial information included on the Company’s website. Legislation in the UK governing the preparation and dissemination of financial statements may differ from legislation in other jurisdictions.

For and on behalf of the Directors:

Avril Palmer-Baunack Tim LampertExecutive Chairman Chief Financial Officer26 June 2017


Independent auditor’s report


Report on the financial statementsOur opinionIn our opinion:• BCA Marketplace plc’s Group financial statements and Parent

Company financial statements (the ‘financial statements’) give a true and fair view of the state of the Group’s and of the Parent Company’s affairs as at 2 April 2017 and of the Group’s profit and the Group’s and the Parent Company’s cash flows for the year then ended;

• the Group financial statements have been properly prepared in accordance with International Financial Reporting Standards (‘IFRSs’) as adopted by the European Union;

• the Parent Company financial statements have been properly prepared in accordance with IFRSs as adopted by the European Union and as applied in accordance with the provisions of the Companies Act 2006; and

• the financial statements have been prepared in accordance with the requirements of the Companies Act 2006 and, as regards the Group financial statements, Article 4 of the IAS Regulation.

What we have auditedThe financial statements, included within the Annual Report and Accounts (the ‘Annual Report’), comprise:• the Consolidated and Company balance sheets as at 2 April

2017;• the Consolidated income statement and Consolidated

statement of comprehensive income for the year then ended;• the Consolidated and Company cash flow statements for the

year then ended;• the Consolidated and Company statement of changes in equity

for the year then ended; and• the notes to the financial statements, which include a summary

of significant accounting policies and other explanatory information.

Certain required disclosures have been presented elsewhere in the Annual Report, rather than in the notes to the financial statements. These are cross-referenced from the financial statements and are identified as audited.

The financial reporting framework that has been applied in the preparation of the financial statements is IFRSs as adopted by the European Union and, as regards the Parent Company financial statements, as applied in accordance with the provisions of the Companies Act 2006, and applicable law.

In applying the financial reporting framework, the Directors have made a number of subjective judgements, for example in respect of significant accounting estimates. In making such estimates, they have made assumptions and considered future events.

Opinions on other matters prescribed by the Companies Act 2006In our opinion, based on the work undertaken in the course of the audit:• the information given in the Strategic report and the Directors’

report for the financial year for which the financial statements are prepared is consistent with the financial statements; and

• the Strategic report and the Directors’ report have been prepared in accordance with applicable legal requirements.

In addition, in light of the knowledge and understanding of the Group, the Parent Company and their environment obtained in the course of the audit, we are required to report if we have identified any material misstatements in the Strategic report and the Directors’ report. We have nothing to report in this respect.

In our opinion, based on the work undertaken in the course of the audit:• the part of the Directors’ Remuneration report to be audited

has been properly prepared in accordance with the Companies Act 2006.

Other matters on which we are required to report by exception Adequacy of accounting records and information and explanations receivedUnder the Companies Act 2006 we are required to report to you if, in our opinion:• we have not received all the information and explanations we

require for our audit; or• adequate accounting records have not been kept by the Parent

Company, or returns adequate for our audit have not been received from branches not visited by us; or

• the Parent Company financial statements and the part of the Directors’ Remuneration report to be audited are not in agreement with the accounting records and returns.

We have no exceptions to report arising from this responsibility.

Directors’ remunerationUnder the Companies Act 2006 we are required to report to you if, in our opinion, certain disclosures of Directors’ remuneration specified by law are not made. We have no exceptions to report arising from this responsibility.

Responsibilities for the financial statements and the auditOur responsibilities and those of the DirectorsAs explained more fully in the Statement of Directors’ responsibilities set out on page 62, the Directors are responsible for the preparation of the financial statements and for being satisfied that they give a true and fair view.

Our responsibility is to audit and express an opinion on the financial statements in accordance with applicable law and International Standards on Auditing (UK and Ireland) (‘ISAs (UK & Ireland)’). Those standards require us to comply with the Auditing Practices Board’s Ethical Standards for Auditors.


FinancialsG


This report, including the opinions, has been prepared for and only for the Parent Company’s members as a body in accordance with Chapter 3 of Part 16 of the Companies Act 2006 and for no other purpose. We do not, in giving these opinions, accept or assume responsibility for any other purpose or to any other person to whom this report is shown or into whose hands it may come save where expressly agreed by our prior consent in writing.

What an audit of financial statements involvesWe conducted our audit in accordance with ISAs (UK & Ireland). An audit involves obtaining evidence about the amounts and disclosures in the financial statements sufficient to give reasonable assurance that the financial statements are free from material misstatement, whether caused by fraud or error. This includes an assessment of:• whether the accounting policies are appropriate to the Group’s

and the Parent Company’s circumstances and have been consistently applied and adequately disclosed;

• the reasonableness of significant accounting estimates made by the Directors; and

• the overall presentation of the financial statements.

We primarily focus our work in these areas by assessing the Directors’ judgements against available evidence, forming our own judgements, and evaluating the disclosures in the financial statements.

We test and examine information, using sampling and other auditing techniques, to the extent we consider necessary to provide a reasonable basis for us to draw conclusions. We obtain audit evidence through testing the effectiveness of controls, substantive procedures or a combination of both.

In addition, we read all the financial and non-financial information in the Annual Report to identify material inconsistencies with the audited financial statements and to identify any information that is apparently materially incorrect based on, or materially inconsistent with, the knowledge acquired by us in the course of performing the audit. If we become aware of any apparent material misstatements or inconsistencies we consider the implications for our report. With respect to the Strategic Report and Directors’ Report, we consider whether those reports include the disclosures required by applicable legal requirements.

John Minards (Senior Statutory Auditor) for and on behalf of PricewaterhouseCoopers LLPChartered Accountants and Statutory AuditorsSt Albans26 June 2017


For the year ended

2 April 2017


3 April 2016¹

Note £m £m £m £m

Revenue 4 2,029.7 1,153.1 Cost of sales (1,624.5) (844.5)

Gross profit 405.2 308.6 Operating costs 7 (330.9) (292.3)

Operating profit 4 74.3 16.3 Finance income 0.4 0.3 Finance costs 9 (18.3) (12.7)

Profit before income tax 56.4 3.9 Income tax (charge)/credit 12 (15.3) 3.8

Profit for the year/period 41.1 7.7

Attributable to: Equity owners of the Parent 40.9 7.7 Non-controlling interests 0.2 –

41.1 7.7

Earnings per share from continuing operations attributable to the

equity holders of the Parent during the year/period

Basic earnings per share (pence) 11 5.2 1.2 Diluted earnings per share (pence) 11 5.1 1.2

Operating profit: 74.3 16.3

Add: Depreciation and amortisation 4 25.2 17.0 Amortisation of acquired intangibles 4 38.5 34.4 Acquisition related items 4 2.9 27.4 Business closure costs 4 – 1.1 Profit on sale and leaseback 4 (5.3) – Other significant or non-recurring items 4 – 2.3 Adjusted EBITDA 135.6 98.5

Less: Depreciation and amortisation (25.2) (17.0) Net finance costs (17.9) (12.4)

Add: Arrangement fees write-off 4.9 – Adjusted profit before income tax 97.4 69.1 Adjusted earnings per share from continuing operations attributable to

the equity holders of the Parent during the year/period

Adjusted basic earnings per share (pence) 11 9.2 7.1Adjusted diluted earnings per share (pence) 11 9.1 7.0

1 The prior period is a 15 month period ended 3 April 2016 that contains 12 months of trading of the BCA Group from its acquisition on 2 April 2015, and incorporates other acquired companies from their respective dates of acquisition by the Group

Consolidated financial statements

Consolidated income statement


Strategic reportFinancials

Governance

For the year ended 2 April 2017

£m


3 April 2016£m

Profit for the year/period 41.1 7.7 Other comprehensive income: Items that will not be reclassified to the income statement

Remeasurements on defined benefit schemes, including deferred tax (7.9) (0.3)Deferred tax on net movements in share based payments 0.1 –

Items that may be subsequently reclassified to the income statement Foreign exchange translation 22.4 29.0

Total other comprehensive income, net of tax 14.6 28.7

Total comprehensive profit for the year/period 55.7 36.4

Attributable to: Equity owners of the Parent 55.5 36.4 Non-controlling interests 0.2 –

55.7 36.4


Consolidated statement of comprehensive income



Consolidated statement of changes in equity

Attributable to equity owners of the Parent

Non-controlling

interests£m

Totalequity

£m

Note

Share capital

£m

Share premium

£m

Merger reserve

£m

Foreign exchange

reserve£m

(Accumulated deficit)/

retained profit£m

Total£m

Balance at 31 December 2014 0.3 28.7 – – (0.3) 28.7 – 28.7 Total comprehensive income for

the period Profit for the period – – – – 7.7 7.7 – 7.7 Other comprehensive income – – – 29.0 (0.3) 28.7 – 28.7

Total comprehensive income for the period – – – 29.0 7.4 36.4 – 36.4

Contributions and distributions Net proceeds from shares issued 24 7.5 986.6 103.6 – – 1,097.7 – 1,097.7 Capital reduction 24 – (1,015.3) – – 1,015.3 – – – Share based payments 29 – – – – 0.6 0.6 – 0.6 Dividends paid 25 – – – – (15.6) (15.6) – (15.6)

Changes in ownership interests Acquisition of subsidiary with non-controlling interest – – – – – – (0.2) (0.2)

Total transactions with owners 7.5 (28.7) 103.6 – 1,000.3 1,082.7 (0.2) 1,082.5

Balance at 3 April 2016 7.8 – 103.6 29.0 1,007.4 1,147.8 (0.2) 1,147.6 Total comprehensive income for

the year Profit for the year – – – – 40.9 40.9 0.2 41.1 Other comprehensive income – – – 22.4 (7.8) 14.6 – 14.6

Total comprehensive income for the year – – – 22.4 33.1 55.5 0.2 55.7

Contributions and distributions Share based payments 29 – – – – 1.6 1.6 – 1.6 Dividends paid 25 – – – – (48.4) (48.4) – (48.4)

Changes in ownership interests Acquisition of subsidiary with non-controlling interest 5 – – – – (0.6) (0.6) 0.2 (0.4)

Total transactions with owners – – – – (47.4) (47.4) 0.2 (47.2)

Balance at 2 April 2017 7.8 – 103.6 51.4 993.1 1,155.9 0.2 1,156.1



Governance


Consolidated balance sheet

Note

As at 2 April 2017

£m

As at 3 April 2016

£m

Non-current assets Intangible assets 13 1,559.5 1,449.5 Property, plant and equipment 14 133.3 115.5 Deferred tax assets 23 11.8 15.9

Total non-current assets 1,704.6 1,580.9

Current assets Inventories 15 58.3 19.3 Trade and other receivables 16 337.1 210.0 Cash and cash equivalents 17 84.4 102.4 Current tax – 0.3

Total current assets 479.8 332.0

Total assets 2,184.4 1,912.9

Non-current liabilities Bank borrowings 19 (254.9) (273.1)Trade and other payables 18 (101.9) (88.7)Pension deficit 22 (17.3) (7.6)Provisions 21 (17.7) (18.7)Deferred tax liabilities 23 (113.3) (110.8)

Total non-current liabilities (505.1) (498.9)

Current liabilities Bank borrowings 19 (90.0) –Partner Finance borrowings 20 (69.0) (40.2)Trade and other payables 18 (358.5) (225.3)Current tax (4.5) – Provisions 21 (1.2) (0.9)

Total current liabilities (523.2) (266.4)

Total liabilities (1,028.3) (765.3)

Net assets 1,156.1 1,147.6

Equity shareholders’ funds Share capital 24 7.8 7.8 Merger reserve 24 103.6 103.6 Foreign exchange reserve 24 51.4 29.0 Retained profit 24 993.1 1,007.4

Equity shareholders’ funds 1,155.9 1,147.8 Non-controlling interests 0.2 (0.2)

Total shareholders’ funds 1,156.1 1,147.6

The financial statements on pages 66 to 107 were approved by the Board on 26 June 2017 and were signed on its behalf by:

Avril Palmer-Baunack Tim LampertExecutive Chairman Chief Financial Officer



Consolidated cash flow statement

Note


£m


3 April 2016£m

Cash generated from operations 6 138.3 89.9 Increase in Partner Finance loan book (48.7) (36.6)Interest paid (8.9) (6.1)Interest received 0.1 0.3 Income tax paid (13.3) (3.7)

Net cash inflow from operating activities before acquisition related cash flows 67.5 43.8 Acquisition related cash flows (3.0) (46.4)

Net cash inflow/(outflow) from operating activities 64.5 (2.6)

Cash flows from investing activities Purchase of property, plant and equipment (53.8) (24.6)Purchase of intangible assets (10.9) (13.3)Proceeds from sale of property, plant and equipment 36.6 4.9 Proceeds from sale of asset held for sale – 1.5 Acquisition of subsidiary undertakings, net of cash acquired (99.6) (690.3)

Net cash outflow from investing activities (127.7) (721.8)

Cash flows from financing activities Proceeds from share issue 24 – 993.4 Dividends paid 25 (48.4) (15.6)Proceeds from borrowings 400.0 275.0 Repayments of borrowings (335.0) (468.6)Financing fees paid 19 (2.9) (7.7)Proceeds from sale and leaseback of finance leases 5.8 – Payment of finance lease liabilities (6.0) (1.8)Increase in Partner Finance borrowings 28.8 20.5

Net cash inflow from financing activities 42.3 795.2

Net (decrease)/increase in cash and cash equivalents (20.9) 70.8 Foreign exchange on cash held 2.9 2.8 Cash and cash equivalents brought forward 102.4 28.8

Cash and cash equivalents at year/period end 17 84.4 102.4



Governance

Notes to the consolidated financial statements

1. General informationBCA Marketplace plc (the ‘Company’), was incorporated in April 2014 with the aim to acquire and manage companies in the UK and European automotive sector. On 2 April 2015, BCA Marketplace plc acquired the BCA Group (‘BCA Group’). This was followed by the acquisitions of SMA Vehicle Remarketing Limited (‘SMA’) on 1 June 2015, Stobart Automotive Limited (‘BCA Automotive’) on 25 August 2015 and Ambrosetti (U.K.) Limited (‘Ambrosetti’) on 4 February 2016. On 18 July 2016 Paragon Automotive Limited Group of Companies (‘Paragon’) was acquired, followed by Supreme Wheels Direct Limited (‘Supreme Wheels’) on 31 March 2017, both are discussed further in note 5.

The Group financial statements consolidate those of the Company and its subsidiaries (together referred to as the ‘Group’). The Parent Company financial statements present information about the Company as a separate entity and not about its Group, and can be found on pages 108 to 113.

The comparative period in these financial statements is for a 15 month period ended 3 April 2016, however, this represents 12 months of trading since the BCA Group acquisition on 2 April 2015, and incorporates other acquired companies from their respective dates of acquisition by the Group.

The Company is a public limited company, listed on the London Stock Exchange and incorporated and domiciled in the UK with the registered number 09019615. The address of the Company’s registered office is, BCA Marketplace plc, BCA Bedford, Coronation Business Park, Kempston Hardwick, Bedford MK43 9PR.

2. Accounting policies(a) Basis of preparationThese consolidated financial statements for the year ended 2 April 2017 have been prepared in accordance with International Financial Reporting Standards (‘IFRS’) and IFRS Interpretations Committee (‘IFRS IC’) interpretations as adopted by the European Union (‘Adopted IFRS’) and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The consolidated financial statements have been prepared under the historical cost convention, as modified by the revaluation of financial assets and financial liabilities (including derivatives) at fair value through profit or loss.

The financial statements and the notes to the financial statements are presented in millions of pounds sterling (‘£m’) except where otherwise indicated.

Judgements made by the Directors in the application of the accounting policies that have a significant effect on the financial statements and estimates with a significant risk of material adjustment in the next year are discussed in note 3.

(b) Going concernThe Group maintains a mixture of medium-term debt, committed credit facilities, finance lease arrangements and cash reserves, which together are designed to ensure that the Group has sufficient available funds to finance its operations. The Board reviews forecasts of the Group’s liquidity requirements based on a range of scenarios to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its committed borrowing facilities at all times, so that the Group does not breach borrowing limits or covenants (where applicable) on any of its borrowing facilities. During the year the Group agreed a new loan facility, as discussed in note 19, which enhances the Group’s liquidity.

After making appropriate enquiries and having considered the business activities and the Group’s principal risks and uncertainties, the Directors are satisfied that the Company and the Group as a whole have adequate resources to continue in operational existence for the foreseeable future. Accordingly, the consolidated financial statements have been prepared on a going concern basis.

(c) Basis of consolidationSubsidiaries are all entities over which the Group has control. The Group controls an entity when the Group is exposed to, or has rights to, variable returns from its involvement with the entity and has the ability to affect those returns through its power over the entity. Subsidiaries are fully consolidated from the date on which control is transferred to the Group. They are deconsolidated from the date that control ceases.

Losses applicable to non-controlling interests are allocated to the non-controlling interests even if doing so causes the non-controlling interests to have a deficit balance.

Intragroup balances, and any gains and losses or income and expenses arising from intragroup transactions, are eliminated in preparing the consolidated financial statements. Gains arising from transactions with jointly controlled entities are eliminated to the extent of the Group’s interest in the entity. Losses are eliminated in the same way as gains, but only to the extent that there is no evidence of impairment.


2. Accounting policies continued(d) New standards, amendments and interpretationsNo new standards, amendments or interpretations effective for the first time for the financial year beginning on or after 1 January 2016 have had a material impact on the Group or Parent Company.

Standards and interpretations which are issued but not yet effective and have not been early adopted by the Group are as follows:• IFRS 9 Financial instruments addresses the classification, measurement and recognition of financial assets and financial liabilities and

replaces IAS 39. IFRS 9 will become effective for accounting periods starting on or after 1 January 2018, subject to EU endorsement. The impact of the standard is currently being assessed by management but it is not expected to have a material impact on the Group.

• IFRS 15 Revenue from contracts with customers will become effective for accounting periods starting on or after 1 January 2018, subject to EU endorsement. The impact of the standard is currently being assessed by management, which requires a thorough review of existing contractual arrangements. Given the proximity between the timing of performance obligations being met and revenue being recognised, management’s initial assessment is that the impact of this standard is limited.

• IFRS 16 Leases establishes principles for the recognition, measurement, presentation and disclosure of leases and replaces IAS17. IFRS 16 will become effective for accounting periods starting on or after 1 January 2019, subject to EU endorsement. The impact of the standard is currently being assessed by management but will result in the recognition of a lease liability and a corresponding asset on the Group’s balance sheet in respect of the majority of leases, which predominantly represent buildings and vehicle transporters, and are currently classified as operating leases.

(e) Foreign currency translationThe functional currency of the Company and the majority of entities within the Group is Sterling because that is the currency of the primary economic environment in which they operate. The Group’s presentation currency is Sterling.

Transactions and balancesForeign currency transactions are translated into the respective functional currency of Group entities using the exchange rates prevailing at the date of the transaction. Foreign exchange gains and losses resulting from the settlement of such transactions and from the translation at period-end exchange rates of unsettled monetary assets and liabilities denominated in foreign currencies are recognised in the income statement. Non-monetary assets and liabilities that are measured in terms of historical cost in a foreign currency are translated using the exchange rate at the date of the transaction.

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. All other foreign exchange gains and losses are presented in the income statement within other income or other operating costs.

Consolidation of Group companiesThe results and financial position of all Group entities that have a functional currency different from the presentation currency are translated into the presentation currency as follows:• assets and liabilities including goodwill, intangible assets arising on acquisition and fair value adjustments arising on consolidation for

each balance sheet presented are translated at the closing rate at the date of that balance sheet;• income and expenses for each income statement presented are translated at average exchange rates (unless this average is not a

reasonable approximation of the cumulative effect of the rates prevailing on the transaction dates, in which case income and expenses are translated at the rate on the dates of the transactions); and

• all resulting exchange differences are recognised in other comprehensive income and are accumulated in the foreign exchange translation reserve or non-controlling interest.

On disposal of a foreign subsidiary, the cumulative amount of the exchange differences recognised in other comprehensive income and accumulated in the foreign exchange translation reserve shall be recognised in the income statement when the gain or loss on disposal is recognised.

(f) Property, plant and equipmentOwned assetsItems of property, plant and equipment are stated at cost or deemed cost less accumulated depreciation and impairment losses. Cost includes the original purchase price of the asset and the costs attributable to bringing the asset to its working condition for its intended use. When parts of an item of property, plant and equipment have different useful lives, those components are accounted for as separate items of property, plant and equipment. Subsequent costs are included in the asset’s carrying amount or recognised as a separate asset, as appropriate, only when it is probable that future economic benefits associated with the item will flow to the Group and when the cost of the item can be measured reliably.

Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the income statement.




Governance

Assets under constructionThe costs of assets that are being constructed are capitalised as described in the owned assets paragraph above. Assets under construction are not depreciated until the asset is deemed to be available for use. For the asset to be available for use it has to be in the location and condition necessary for it to be capable of operating in the intended manner. Once the asset is available for use it is no longer classified as an asset under construction and is instead depreciated like any other item of property, plant and equipment.

Leased assets Leases under which the Group assumes substantially all the risks and rewards of ownership of an asset are classified as finance leases. Property, plant and equipment acquired under a finance lease is recorded at fair value or, if lower, the present value of minimum lease payments at inception of the lease, less depreciation and any impairment.

Each lease payment is allocated between the liability and finance charges. The corresponding rental obligations, net of finance charges, are included in the other short-term or long-term payables as appropriate. The interest element of the finance cost is charged to the income statement over the lease period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.

Assets leased under operating leases are not recorded on the balance sheet. Rental payments are charged directly to the income statement on a straight-line basis over the period of the lease. Lease incentives received are recognised as a reduction of rental expense over the lease term, on a straight line basis.

DepreciationDepreciation is charged to the income statement on a straight-line basis over the estimated useful lives of each part of an item of property, plant and equipment. Any property, plant and equipment acquired under a finance lease is depreciated over the shorter of the useful life of the asset and the lease term. Freehold land and assets under construction are not depreciated. The rates of depreciation are as follows:

Land and buildings 50 years or the unexpired lease period if shorterFixture, fittings and equipment 2 – 10 yearsPlant, machinery and motor vehicles 3 – 25 years

Assets acquired through business combinations are depreciated over their remaining useful life at acquisition. The residual values and useful lives are reviewed and adjusted if appropriate, at each balance sheet date. For the Group’s impairment policy on non-financial assets see (i) Impairment of non-financial assets.

(g) Intangible assetsIntangible assets comprise internally generated software, acquired computer software and intangible assets, such as customer relationships and brand, arising as part of the assessment of assets on the acquisition of a business. These are carried at cost less accumulated amortisation and any recognised impairment loss.

Costs relating to the development of computer software for internal use are capitalised once all the development phase recognition criteria of IAS 38 are met. Costs incurred before this point are expensed as incurred and are not recognised as an asset in a subsequent period. The assessment identifies unique software products that are controlled by the Group and that will probably generate economic benefits exceeding costs beyond one year. Salary and related employment costs that are directly attributable to the development of the software are then capitalised. When the software is available for its intended use these costs are amortised in equal annual amounts over the estimated useful life of the software.

Amortisation and impairment are charged to operating costs in the period in which they arise. Amortisation is calculated on a straight-line basis from the date on which the assets are brought into use with useful lives as indicated below:

Customer relationships 12 – 20 yearsBrand 15 – 25 yearsSoftware – Internally generated 3 – 10 yearsSoftware – Acquired 3 – 7 years or the licence term if shorter

Assets acquired through business combinations are amortised over the remaining useful life at acquisition.

Amortisation periods and methods are reviewed annually and adjusted if appropriate. For the Group’s impairment policy on non-financial assets see (i) Impairment of non-financial assets.


2. Accounting policies continued (h) GoodwillGoodwill arises on the acquisition of subsidiaries and is recognised initially as the excess of the consideration transferred, over the Group’s interest in fair value of the net identifiable assets, liabilities and contingent liabilities of the acquiree and the fair value of the non-controlling interest in the acquiree. Goodwill is stated at cost less accumulated impairment losses. Goodwill is allocated to cash-generating units, which are no higher than an operating segment prior to aggregation, and is not amortised but is tested annually for impairment.

An impairment charge is recognised in the income statement for any amount by which the carrying value of goodwill exceeds its recoverable amount. Goodwill that is not denominated in Sterling is retranslated at each balance sheet date.

(i) Impairment of non-financial assetsGoodwill has an indefinite useful life and is not subject to amortisation. As a result it is tested annually for impairment, or more frequently if events or changes in circumstances indicate that it might be impaired. Other assets that are subject to amortisation are reviewed for impairment whenever events or changes in circumstances indicate that the carrying amount may not be recoverable. An impairment loss is recognised for the amount by which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount is the higher of an asset’s fair value less costs of disposal and value in use. For the purpose of assessing impairment, assets are grouped at the lowest levels for which there are separately identifiable cash inflows (‘cash-generating units’), which are largely independent of the cash inflows from other assets or group of assets. Non-financial assets, other than goodwill, that suffered an impairment are reviewed for possible reversal of the impairment at each reporting date.

(j) Financial assets ClassificationThe Group classifies its financial assets as loans and receivables. Management determines the classification of its financial assets at initial recognition.

Loans and receivablesLoans and receivables are non-derivative financial assets with fixed or determinable payments that arise principally through the provision of services to customers. They are initially recognised at fair value and are subsequently stated at amortised cost using the effective interest method, where the impact is material. They are included in current assets, except for maturities greater than 12 months after the end of the reporting period. Loans and receivables comprise trade and other receivables and cash and cash equivalents in the balance sheet.

Impairment of financial assets Impairment provisions are recognised when there is objective evidence (such as significant financial difficulties on the part of the counterparty, default or significant delay in payment) that the Group will be unable to collect all of the amounts due under the terms of the receivable, the amount of such a provision being the difference between the net carrying amount and the present value of the future expected cash flows associated with the impaired receivable discounted at the assets’ original effective interest rate.

For trade receivables, which are reported net of any provisions, such provisions are recorded in a separate provision account with the loss being recognised within operating costs in the income statement. On confirmation that the trade receivable will not be collectable, the gross carrying value of the asset is written off against the associated provision.

(k) InventoriesInventories primarily represent vehicles acquired by the Group that have not yet been sold and where the Group has the risk and reward of ownership of such vehicles. Other inventories comprise vehicle spares. All inventories are stated at the lower of purchase cost and net realisable value. Cost represents expenses incurred in bringing each product to its present location and condition. In the Vehicle Remarketing divisions, in the course of achieving a successful sale on behalf of a vendor, it can be necessary to take legal title of a vehicle before selling it to the end customer. This occurs with 1% to 2% of volume and the net gain or loss is included within cost of sales. In the Vehicle Buying division the vehicle cost is net of any administration fees paid to the Group by the seller of the vehicle. Net realisable value is based on estimated normal selling price, less further costs expected to be incurred on completion of the sale and disposal.

(l) Cash and cash equivalentsCash and cash equivalents comprise cash balances and call deposits with an original maturity of three months or less. Bank overdrafts that are repayable on demand and form an integral part of the Group’s cash management are included as a component of cash and cash equivalents for the purpose of the cash flow statement. (m) Offsetting financial instrumentsFinancial assets and liabilities are offset and the net amount reported in the balance sheet only when there is a legally enforceable right to offset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability simultaneously.




Governance

(n) Trade and other payablesTrade and other payables are initially stated at fair value and subsequently measured at amortised cost using the effective interest method.

(o) BorrowingsBorrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost using the effective interest method.

Fees paid on the establishment of loan facilities are recognised as transaction costs of the loan to the extent that it is probable that some or all of the facility will be drawn-down. In this case, the fee is deferred until the draw-down occurs. To the extent there is no evidence that it is probable that some or all of the facility will be drawn-down, the fee is capitalised as a prepayment for liquidity services and amortised over the expected utilisation of the facility to which it relates.

As described in note 19, the Group agreed a new borrowing facility in February 2017. There is a choice, when determining if a new facility is substantially different from an existing facility, between making a decision solely on quantitative factors or also using qualitative factors. Management have taken the decision to apply qualitative factors when making this assessment. The impact of this assessment has been to derecognise the old facility and the associated arrangement fees in the year.

(p) ProvisionsA provision is recognised in the balance sheet when the Group has a present legal or constructive obligation as a result of a past event, that can be measured reliably and it is probable that an outflow of economic benefits will be required to settle the obligation. If the effect is material, provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessments of the time value of money and, when appropriate, the risks specific to the liability. The increase in the provision due to the passage of time is recognised in finance costs.

Property leases and dilapidationsProvisions for onerous leases on property are recognised when it is probable that future obligations under the lease will exceed earnings achievable from the property, taking into account the Directors’ estimation of likely income from the subletting of vacant property. The amounts of such net outflows are discounted at the risk-appropriate rate, and are stated net of any anticipated sub-lease income.

Provisions for dilapidations are made in respect of property leases on a lease by lease basis and are based on the Group’s best estimate of the likely committed cash outflow. Where relevant, these estimated outflows are discounted to net present value.

(q) Share capitalOrdinary shares are classified as equity. Incremental costs directly attributable to the issue of new shares are shown in share premium as a deduction from the proceeds.

(r) RevenueOutsourced vehicle auction revenue represents the vehicle sale proceeds obtained when the vehicle is sold and is recognised on the date of sale. It is the intention for the Group to take legal title of certain vehicles based on contractual agreements with corporates before the vehicle is sold to the end customer through the various remarketing channels.

Vehicle auction revenue represents vendor and buyer fees for vehicles sold by the Group, together with fees for related services including transportation, inspection, valeting and mechanical checks. Revenue is recognised at the time the service is provided, which is predominantly at the point the vehicle is sold at auction. Revenue represents the fees for the auction service not the value of the vehicle sold, as the Group does not incur the significant risks and rewards of ownership as part of the transaction.

Interest and loan origination fees earned in respect of the provision of Partner Finance loans are recognised over the term of the funding and are included within revenue. Fees charged by Partner Finance are recognised evenly over the period that the relevant service is provided.

Vehicle buying revenue represents the vehicle sale proceeds obtained when the vehicle is sold and is recognised on the date of sale. Transaction fees charged to vendors of vehicles are recognised on the purchase invoice date and treated as a reduction in the cost of inventory and therefore in the cost of sales.

Revenue for other services, including logistics and automotive services, is recognised once the contracted service has been provided. For transportation or delivery services, this is deemed to be when the customer has received the vehicle; for storage services this is deemed to be once an activity has been completed, such as receiving and parking a vehicle, and generally on a daily basis for storage charges; for vehicle repair and vehicle enhancement work this is deemed to be when work has been completed to a stage that can be invoiced to the customer; and for fleet services management this is deemed to be over the period the service is provided.


2. Accounting policies continued (s) Advertising and marketing costsThe Group carries out a variety of advertising and marketing activities. These include advertising activities which correlate to the number of vehicles that are acquired by the Group through the Vehicle Buying division and for subsequent sale through the Group’s auctions for which revenue is recognised. These direct advertising costs are therefore recognised as a cost of sale. All other indirect advertising and marketing costs are recognised within operating costs.

The cost of advertising design is expensed as incurred and the expense of advertising campaigns is expensed in the income statement in the period in which the advertising space or air time is utilised.

(t) Net finance costsFinance costsFinance costs comprise interest payable on borrowings, direct transaction costs, unwinding of the discount on provisions, net interest cost of defined benefit pension arrangements and foreign exchange losses on finance balances. Transaction costs are amortised over the life of the debt using the effective interest method.

Finance incomeFinance income comprises interest receivable on funds invested and foreign exchange gains on finance balances. Interest income is recognised in the income statement as it accrues using the effective interest method.

(u) Income taxIncome tax for the periods presented comprises current and deferred tax. Income tax is recognised in income or other comprehensive income except to the extent that it relates to items recognised directly in equity, in which case it is recognised in equity.

Current tax is the expected tax payable on the taxable income for the period, using tax rates enacted or substantively enacted at the balance sheet date, and any adjustment to taxes payable in respect of previous periods. Current tax assets and liabilities are offset only if certain criteria are met.

Deferred tax is recognised in respect of temporary differences between the carrying amounts of assets and liabilities for financial reporting purposes and the amounts used for taxation purposes.

The following temporary differences are not provided for: the initial recognition of goodwill; the initial recognition of other assets or liabilities that affect neither accounting nor taxable profit other than in a business combination; and differences relating to investments in subsidiaries to the extent that they are unlikely to reverse in the foreseeable future. The amount of deferred tax provided is based on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted at the balance sheet date.

A deferred tax asset is recognised only to the extent that it is probable that future taxable profits will be available against which the asset can be utilised. Deferred tax assets are reduced to the extent that it is no longer probable that the related tax benefit will be realised.

Deferred tax assets and liabilities are offset when there is a legally enforceable right to offset current tax assets against current tax liabilities and when the deferred tax assets and liabilities relate to income taxes levied by the same taxation authority on either the taxable entity or different taxable entities where there is an intention to settle the balances on a net basis.

Additional income taxes that arise from the distribution of dividends are recognised at the same time as the liability to pay the related dividend.

(v) Employee benefitsPension obligationsThe Group operates defined contribution and defined benefit plans.

A defined contribution plan is a pension plan under which the Group pays fixed contributions into a separate entity. The Group has no legal or constructive obligations to pay further contributions if the fund does not hold sufficient assets to pay all employees the benefits relating to employee service in the current and prior periods. The Group has no further payment obligations once the contributions have been paid. The contributions are recognised as an employee benefit expense when they are due. Prepaid contributions are recognised as an asset to the extent that a cash refund or a reduction in the future payments is available.

The defined benefit plans operated by the Group in the United Kingdom are closed to new members. The costs of providing benefits under the plans are determined using the projected unit credit actuarial valuation method.




Governance

The current service cost is included in operating costs in the consolidated income statement. Past service costs are similarly included where the benefits have vested, otherwise they are amortised on a straight-line basis over the vesting period. Administrative scheme expenses associated with the plans are recorded within operating costs when incurred in line with IAS 19. Net interest income or interest cost relating to the funded defined benefit pension plans is included within finance income or finance costs as relevant in the consolidated income statement.

Changes to the retirement benefit obligation or asset due to experience and changes in actuarial assumptions are included in the consolidated statement of comprehensive income, presented as remeasurements of the defined benefit scheme in full in the period in which they arise.

Where scheme assets exceed the defined benefit obligation the net asset is only recognised to the extent that an economic benefit is available to the Group in accordance with the terms of the scheme and where consistent with relevant statutory requirements.

Share based payment transactionsThe Group operates equity-settled, share-based plans. The fair value of the employee services received in exchange for the grant of the awards is recognised as an expense. The total amount to be expensed over the vesting period is determined by reference to the fair value of the compensation as determined by independent valuations. Non-market vesting conditions are included in assumptions about the number of awards that are expected to vest.

The cost of equity-settled transactions are recognised, together with a corresponding increase in equity, over the period which the performance conditions are fulfilled, ending on the date on which the relevant employees are expected to become fully entitled to the award (vesting date).

At each reporting date, the cumulative expense recognised for equity-settled transactions reflects, in the opinion of the Directors, the number of awards that will vest and the proportion of the period to vesting that has expired. Directors’ estimates are based on the best available information at that date.

No expense is recognised for awards that do not ultimately vest, except for awards where vesting is conditional upon a market condition, which are treated as vesting, irrespective of whether or not the market condition is satisfied, provided that all other performance conditions are satisfied.

3. Critical accounting judgements and estimatesThe preparation of the Group’s consolidated and Parent Company financial statements under Adopted IFRS requires the Directors and management to make judgements, estimates and assumptions that affect the reported amounts of assets and liabilities and the disclosure of contingent assets and liabilities. Accounting policies are reviewed annually for appropriateness. Estimates and judgements are evaluated continually and are based on historical experience and other factors including expectations of future events that are believed to be reasonable under the circumstances. Actual results may differ from these estimates, with any changes arising being recognised in the period in which the change in estimate is made or the final result determined.

Certain of the Group’s significant accounting policies are considered by the Directors to be critical because of the level of complexity, judgement or estimation involved in their application and their impact on the consolidated financial statements. These are discussed below:

JudgementsThe principal judgements made in the year are as follows:

Acquisition accountingAs described in note 5, BCA Marketplace plc legally acquired the BCA Group in April 2015. Management were required to apply judgement as to whether this should be treated as an accounting acquisition or reverse acquisition. Having considered all the factors in IFRS 3 Business combinations, it was determined that this transaction should be accounted for as an acquisition.

EstimatesThe Directors consider that the following estimates and assumptions are likely to have the most significant effect on the amounts recognised in the consolidated and Parent Company financial statements:

Acquisition accountingFor all acquisitions in the period, management are required to apply judgement and make estimates in relation to the identification and valuation of separable assets and liabilities arising on these acquisitions. In determining the period over which the asset is to be amortised, management must also assess the likely economic life of the asset.

Management have estimated the fair value of contingent consideration likely to arise on the acquisition of subsidiary undertakings by taking account of financial and market targets over the relevant period of time. The time value of money was estimated using an appropriate discount rate.


3. Critical accounting judgements and estimates continuedImpairment of goodwill and intangible assetsAn impairment review has been performed of all goodwill and intangible assets held by the Group. The impairment review is performed on a value in use basis, which requires estimation of future net operating cash flows, the time period over which they will occur, an appropriate discount rate and an appropriate growth rate. Specifically, the future cash flows are sensitive to the assumptions made about the revenue growth, EBITDA margin and the long-term growth rate of the relevant market. Given the degree of subjectivity involved, actual outcomes could vary significantly from these estimates. The detailed assumptions used and associated sensitivity analysis is discussed further in note 13.

TaxationAccruals for current tax and amounts payable under local indirect taxes such as sales taxes and VAT are based on management’s interpretation of country-specific tax law, and require judgements about the likelihood that tax positions taken will be sustained. Management estimates the amount of taxes payable based upon their analysis and determines whether provision should be made for potential settlement of disputed positions through negotiation. All such provisions are included in current liabilities. Any estimated exposure to interest on tax liabilities is provided for in the related tax charge.

Deferred tax assets and liabilities represent management’s best estimate in determining the amounts to be recognised. When assessing the extent to which deferred tax assets should be recognised, consideration is given to the timing and level of future taxable income.

Provisions for onerous leasesWhen the present value of the future cash flows receivable from the operation of leased assets is less than the present value of the rental payments to which the Group is committed, the Group provides for any further onerous element of the contract. Determining the amount of such a provision requires estimating the future net cash flows receivable in respect of these assets, and in the particular case where the leased properties are vacant this requires assessing the likely period for which the property will remain vacant, the cost of any works required to enhance its marketability and the rental income receivable when the property is sublet.

Share based paymentsThe Group’s share based payments have been valued by independent valuation experts. The key estimates used in calculating the fair value of the options are the fair value of the Company’s shares at the grant date, the expected share price volatility, the risk-free interest rate, the expected life of the instrument and the number of shares expected to vest.

PensionsThe Group’s net retirement benefit obligation, which is assessed by independent actuaries each period, is based on key assumptions including discount rates, inflation, future salary increases and pension costs. These assumptions may be different to the actual outcome.

4. Segmental reporting

Key Performance Indicator – adjusted EBITDA Management uses an adjusted profit measure to monitor the ongoing profitability of the Group, which is defined as Earnings before interest, taxation, depreciation and amortisation (‘EBITDA’) adjusted for significant and non-recurring items. The significant and non-recurring items that are excluded from EBITDA to calculate adjusted EBITDA are as follows:• acquisition expenses and gains and losses on business combinations, disposals and changes in ownership;• income and expenses that are significant and non-recurring or non-trading in nature, including business closure costs, restructuring

costs and onerous lease provisions;• impairment charges and accelerated depreciation and amortisation on property, plant and equipment, intangibles and goodwill; • amortisation of intangible assets arising on acquisition of businesses.

The Directors primarily use the adjusted EBITDA measure when making decisions about the Group’s activities as it is the most reliable and relevant profit measure across all segments. As this is a non-GAAP measure, adjusted EBITDA measures used by other entities may not be calculated in the same way and hence are not directly comparable.

Management has determined the operating segments based on the operating reports reviewed by the Board of Directors that are used both to assess performance and make strategic decisions. Management has identified that the Board of Directors is the chief operating decision maker in accordance with the requirements of IFRS 8 ‘Operating Segments’.

The Board of Directors consider the business to be split into the four main divisions generating revenue: Vehicle Remarketing UK, Vehicle Remarketing International, Vehicle Buying and Automotive Services. Group Costs comprise central head office functions and any costs not directly attributable to the segments.




Governance

Information on segment assets and liabilities is not regularly reported to the Board of Directors and is therefore not disclosed.


Vehicle Remarketing Vehicle Buying

£m

Automotive Services

£m

GroupCosts

£mTotal

£mUK£m

International£m

Revenue Total revenue 756.7 136.3 837.4 321.2 – 2,051.6 Inter-segment revenue (2.9) (0.9) (0.4) (17.7) – (21.9)

Total revenue from external customers 753.8 135.4 837.0 303.5 – 2,029.7

Adjusted EBITDA 84.0 26.2 19.5 17.2 (11.3) 135.6 Depreciation and amortisation (12.5) (3.3) (1.6) (7.7) (0.1) (25.2)

71.5 22.9 17.9 9.5 (11.4) 110.4

Amortisation of acquired intangibles (18.5) (11.5) (5.7) (2.8) – (38.5)Acquisition related items (0.5) 0.3 – 0.7 (3.4) (2.9)Profit on sale and leaseback 5.3 – – – – 5.3

Operating profit 57.8 11.7 12.2 7.4 (14.8) 74.3 Finance income 0.4 Finance cost (18.3)

Profit before taxation 56.4

Capital expenditure 30.1 2.9 1.1 36.4 – 70.5

Acquisition related items primarily relate to the acquisition of the Paragon Group. Profit on sale and leaseback represents the net profit following the disposal of an auction site and its subsequent leaseback on an operating lease basis.


4. Segmental reporting continuedThe segmental reporting table that follows has been re-presented from that disclosed in the Annual Report and Accounts 2016. The re-presentation reflects the changes to Group segments and therefore provides a more meaningful comparison. The total amounts adjusted between segments are shown in the table below. Further details of the change in segmentation are discussed in the ‘Operating review’ section.

Segmental information re-presented for the 15 months ended 3 April 2016


£m

Automotive Services

£mOther

£m

Group Costs

£mTotal

£mUK£m

International£m

External revenue as reported 267.2 109.5 698.4 – 78.0 – 1,153.1 Adjustments (24.9) – – 102.9 (78.0) – –

External revenue as re-presented 242.3 109.5 698.4 102.9 – – 1,153.1

Adjusted EBITDA as reported 69.4 18.9 16.1 – (5.9) – 98.5 Adjustments (0.3) – – 4.2 5.9 (9.8) –

Adjusted EBITDA as re-presented 69.1 18.9 16.1 4.2 – (9.8) 98.5

For the 15 months ended 3 April 2016


£m

Automotive Services

£m

Group Costs

£mTotal

£mUK£m

International£m

Revenue Total revenue 245.3 109.9 698.4 111.9 – 1,165.5 Inter-segment revenue (3.0) (0.4) – (9.0) – (12.4)

Total revenue from external customers 242.3 109.5 698.4 102.9 – 1,153.1

Adjusted EBITDA 69.1 18.9 16.1 4.2 (9.8) 98.5 Depreciation and amortisation (9.8) (2.9) (1.2) (2.8) (0.3) (17.0)

59.3 16.0 14.9 1.4 (10.1) 81.5

Amortisation of acquired intangibles (18.4) (10.1) (5.8) (0.1) – (34.4)Acquisition costs – – – – (27.4) (27.4)Business closure costs – – (0.8) – (0.3) (1.1)Other significant or non-recurring items – (0.8) – – (1.5) (2.3)

Operating profit 40.9 5.1 8.3 1.3 (39.3) 16.3 Finance income 0.3 Finance cost (12.7)

Profit before taxation 3.9

Capital expenditure 25.6 3.4 2.1 20.3 0.1 51.5

Revenue with external customers in the UK and Ireland represents £1.8bn (2016: £1.1bn) of the Group’s revenue, with the other £0.2bn (2016: £0.1bn) being generated within Europe. Revenue by type is shown below:


£m


3 April 2016£m

Sale of goods 1,284.0 699.6 Rendering of services 734.0 446.8 Interest 11.7 6.7

Total revenue 2,029.7 1,153.1




Governance

5. AcquisitionsThe following acquisitions have been made by the Group in the year:

ParagonOn 18 July 2016 the Group acquired 100% of the Ordinary shares of Paragon Automotive Limited and subsidiary companies for initial consideration of £102.7m, which is subject to adjustment based on certain circumstances and contingent earn-out payments of up to a maximum of £30m, subject to achievement of financial and market targets over the two financial years ending March 2017 and 2018. Management provisionally estimates that earn-out payments of £20m will be made over this period, which together with expected adjustments to the initial consideration and discounting for the time-value of money, represent a fair value of £18.6m. Following the year end, the March 2017 earn-out payment was paid.

As the leading provider of outsourced vehicle services in the UK, Paragon supplements recent acquisitions and the Group’s current offerings in logistics, refurbishment, imaging, inspection and finance. The acquisition will enable BCA to provide a comprehensive suite of services across the automotive supply chain to OEMs, corporate fleets and dealers alike. The fair values of the assets and liabilities (excluding cash and borrowings) have been determined on a provisional basis whilst being formally reviewed and will be finalised within 12 months of acquisition.

Provisionalfair value

£m

Intangible assets: – Brand 5.9 – Customer relationships 44.6 – Software net book value 0.3Property, plant and equipment 8.4Inventories 2.0Trade and other receivables 28.4Cash and cash equivalents 4.7Trade and other payables (32.1)Deferred tax liability (9.3)Borrowings (2.8)

Net assets acquired 50.1Goodwill 71.2

ConsiderationInitial consideration 102.7Consideration contingent upon events after acquisition date 18.6

Total consideration 121.3

The net movements in net assets and goodwill of £0.7m since the Interim report predominantly reflect updates to working capital items.

Goodwill arising on the acquisition represents the assembled workforce, geographical coverage and buyer synergies from combining the Paragon operations with those of the Group.

The fair value of acquired receivables was £25.5m. The gross contractual amounts receivable were £25.9m, of which £0.4m were not expected to be received.

Supreme WheelsOn 31 March 2017 the Group acquired 75% of the Ordinary shares of Supreme Wheels Direct Limited for initial consideration of £1.6m, which was settled in cash. There is a put and call option to purchase the remaining 25% of the Ordinary shares three years after acquisition. Management has provisionally estimated the amount to purchase the remaining shares, which with discounting for the time value of money, represents a fair value of £0.6m.

Impact of acquisitionsThe consolidated income statement includes revenue and profit before tax, before non-recurring items, for acquisitions in the period of £125.0m and £3.0m respectively. Had the acquisitions occurred on 4 April 2016, it is estimated that their revenue and profit before tax, before non-recurring items, for the year ended 2 April 2017 would have been £178.2m and £5.2m respectively. In determining these amounts, management have assumed that the fair value adjustments that arose on the date of the acquisitions and all circumstances of the acquisitions would have been the same if the acquisitions had taken place on 4 April 2016.


5. Acquisitions continuedPrior period acquisitionsBCA Marketplace plc made four acquisitions in the prior period and in each case acquired 100% of the share capital, with the consideration settled in cash unless otherwise stated.

In accordance with IFRS 3, final measurement period adjustments were made to the provisional values disclosed in the Annual Report and Accounts 2016 relating to the acquisitions listed below. This resulted in a restatement of £1.0m following the revaluation of a property.

BCA Group (acquired 2 April 2015)The BCA Group was acquired for £815.5m satisfied by £711.2m in cash and £104.3m by the issue of 69,535,522 Ordinary shares. The fair value of the Ordinary shares issued was based on the placing share price of the Company as at 2 April 2015 of £1.50 per share. The BCA Group is the number one vehicle remarketing business in the UK and Europe, as well as owning WeBuyAnyCar, the market leading vehicle buying business in the UK. This acquisition was the first in the Group’s initial strategy of acquiring and developing substantial businesses in the automotive sector.

Goodwill has arisen on the acquisition due to the unique position that the BCA Group has in the automotive sector. The BCA Group has created a marketplace and a proposition with an assembled workforce, significant barriers to entry and geographical presence generating a value that cannot be defined and measured as an intangible asset. As such the excess over the identified net assets has been recognised as goodwill.

SMA (acquired 1 June 2015)SMA operates within the vehicle remarketing sector of the automotive industry and therefore complements the acquisition of the BCA Group. Goodwill represents the assembled workforce and geographic coverage which are not identified as intangible assets in their own right.

BCA Automotive (acquired 25 August 2015)BCA Automotive operates vehicle transporters in the UK and therefore complements the acquisition of the BCA Group and SMA through its additional logistics expertise and geographical coverage. Goodwill arising on the acquisition represents the assembled workforce, logistics capabilities and buyer synergies arising from the combining of the operations of BCA Automotive with the logistics businesses within the BCA Group and SMA.

Ambrosetti (acquired 4 February 2016)Ambrosetti specialises in vehicle preparation, refurbishment and de-fleet services as well as logistics services from its storage facilities in Northamptonshire and Kent. The acquisition therefore adds to the Group’s capability to provide services along the automotive value chain, from factory gates or port with technical and logistics services for new vehicles to refurbishment and logistics services for used vehicles and the core remarketing and auction operation. Goodwill represents the assembled workforce and geographic coverage which are not identified as intangible assets in their own right.




Governance

The following table summarises the consideration transferred, and the recognised amounts of assets and liabilities assumed at the acquisition date in the prior period:

As reported 3 April 2016

£m

Adjustments to provisional

fair values£m

Fair value£m

Intangible assets: – Brand name 161.0 – 161.0 – Vendor relationships 338.1 – 338.1 – Buyer relationships 62.4 – 62.4 – Software fair value uplift 22.5 – 22.5 – Software net book value 21.2 – 21.2 Property, plant and equipment 89.6 (1.0) 88.6 Inventories 15.3 – 15.3 Trade and other receivables 180.8 – 180.8 Cash and cash equivalents 79.8 – 79.8 Trade and other payables (346.4) – (346.4)Provisions (21.1) – (21.1)Pension liability (8.2) – (8.2)Deferred tax liability created (98.8) – (98.8)Borrowings and overdraft (469.2) – (469.2)

Net assets acquired 27.0 (1.0) 26.0 Goodwill 846.6 1.0 847.6

Consideration 873.8 – 873.8 Non-controlling interests (0.2) – (0.2)

873.6 – 873.6

Fair value of acquired receivables 154.4 – 154.4 Gross contractual amounts receivable 155.8 – 155.8

Contractual cash flows not expected to be received 1.4 – 1.4


6. Cash generated from operations

Note


£m


3 April 2016£m

Cash flows from operating activities Profit for the year/period 41.1 7.7 Adjustments for:

Income tax charge/(credit) 12 15.3 (3.8)Finance income (0.4) (0.3)Finance costs 9 18.3 12.7 Depreciation 14 14.3 7.8 Amortisation 13 49.4 43.6 Profit on sale of property, plant and equipment (4.5) (0.2)Loss on sale of intangibles 0.7 – Equity-settled share based payments 1.6 0.6 Retirement benefit obligations (0.2) (1.0)Significant or non-recurring items 2.1 27.4

Changes in working capital: Inventories (36.8) (3.7)Trade and other receivables (46.4) 8.3 Trade and other payables 84.9 (7.7)Provisions (1.1) (1.5)

Cash generated from operations 138.3 89.9

7. Operating costs


£m


3 April 2016£m

Employment costs 136.6 110.1 Operating lease – land and buildings 37.4 30.9 Operating lease – other 2.2 2.4 Depreciation of property, plant and equipment 8.6 5.8 Amortisation of intangible assets 49.4 43.6 Other operating costs 96.7 99.5

Operating costs 330.9 292.3




Governance

8. Employees and DirectorsStaff costs for the Group during the year/period:

Note


£m


3 April 2016£m

Wages and salaries 195.1 137.3 Pension costs 4.6 3.3 Social security costs 21.1 16.0 Share based payment expense 29 1.6 0.6

Total gross employment costs 222.4 157.2

Staff costs capitalised (4.8) (8.1)

Total employment cost expense 217.6 149.1

Average monthly number of people employed (including Executive Directors) by reportable segment:

For theyear ended2 April 2017

Number

For the15 months ended

3 April 2016Number

UK 2,324 2,333International 877 797

Vehicle Remarketing 3,201 3,130Vehicle Buying 434 435Automotive Services 3,274 1,530Group 26 22

Total employee numbers 6,935 5,117

The employee numbers reflect the average employee numbers, or where applicable the average number of employees since acquisition. In the current period the total above therefore includes the average number of people employed by Paragon for the nine months since its acquisition. In the prior period the total includes the average number of people employed by the BCA Group for the 12 month period ended 3 April 2016, by SMA for the ten month period, BCA Automotive for the seven month period and Ambrosetti the two month period. The average number of employees for the 15 month period would otherwise be 3,668 people, which is not reflective of the ongoing number of employees within the Group.

The segmental employee number table above has been re-presented from that disclosed in the Annual Report and Accounts 2016. The re-presentation reflects the changes to Group segments and therefore provides a more meaningful comparison. The total employee numbers adjusted between segments are shown in the table below. Further details of the change in segmentation are discussed in the ‘Operating review’ section.


8. Employees and Directors continued


3 April 2016 as reported

NumberAdjustment

Number


3 April 2016 as re-presented

Number

UK 2,477 (144) 2,333 International 797 – 797

Vehicle Remarketing 3,274 (144) 3,130 Vehicle Buying 435 – 435 Automotive Services – 1,530 1,530 Other 1,408 (1,408) – Group – 22 22

Total employee numbers 5,117 – 5,117

Directors’ emolumentsFor details of Directors’ emoluments see the Remuneration Committee report on pages 52 to 60.

Retirement benefitsThe Group offers membership to defined contribution schemes in the UK and Europe. The pensions cost in the year to 2 April 2017 was £3.7m (period to 3 April 2016: £2.3m).

In addition the Group operates the BCA Pension Plan and the Automotive Plan. The BCA Pension Plan and the Automotive Plan are defined benefit schemes closed to new members. Further information is set out in note 22.

9. Finance costs

Note


£m


3 April 2016£m

Interest payable 9.7 9.6 Finance lease interest 0.8 0.4 Net interest expense on retirement benefit obligations 22 0.3 0.2 Unwinding of discount on provisions and non-current liabilities 2.6 2.5 Write-off of arrangement fees 4.9 –

Finance costs 18.3 12.7

10. Auditor’s remunerationDuring the year/period the Group (including its overseas subsidiaries) obtained the following services from the Group auditor at costs as detailed below:


£m


3 April 2016£m

Fees payable to the Group auditor and its associates for the audit of the Parent Company and consolidated financial statements 0.3 0.3

Fees payable to Group auditor and its associates for other services: – The audit of Group subsidiaries 0.7 0.7 – Audit related assurance services – 1.9 – Tax advisory services – 0.1 – Tax compliance services – 0.1 – Other services 0.1 –

Total auditor’s remuneration 1.1 3.1

Included in fees payable to the Group auditor and its associates for the audit of Parent Company and consolidated financial statements is £0.1m (2016: £0.1m) relating to the audit of the Company’s financial statements.




Governance

11. Earnings per share Basic earnings per share amounts are calculated by dividing net profit for the period attributable to ordinary shareholders by the weighted average number of Ordinary shares outstanding during the period.



3 April 2016

Profit for the year/period attributable to equity shareholders (£m) 40.9 7.7

m m

Weighted average number of shares used in calculating basic earnings per share 780.2 630.2 Incremental shares in respect of employee share schemes 16.5 13.0

Weighted average number of shares used in calculating diluted earnings per share 796.7 643.2

Basic earnings per share (pence) 5.2 1.2 Diluted earnings per share (pence) 5.1 1.2

Key Performance Indicator – adjusted earnings per shareAdjusted earnings per share is presented in addition to that required by IAS 33, Earnings per Share, to align the adjusted earnings measure with the performance measure reviewed by the Directors. The Directors consider that this gives a more appropriate indication of underlying performance. Adjusted earnings per share amounts are calculated by dividing net profit for the period attributable to ordinary shareholders, adjusted for significant or non-recurring items and their associated tax impact, by the weighted average number of Ordinary shares outstanding during the period.

The prior period adjusted diluted earnings per share figure below has been calculated using the weighted average number of shares in issue for the 12 month period from the Placing and acquisition of the BCA Group on 2 April 2015, as opposed to the full 15 month period that the comparative represents. Management believe this adjustment to the weighted average number of shares is consistent with the earnings of the BCA Group which are included for the same period.

Note


£m


3 April 2016£m

Profit for the year/period attributable to equity shareholders 40.9 7.7 Add back: Significant or non-recurring items 4,9 41.0 65.2 Tax credit on significant or non-recurring items (9.7) (17.7)

Adjusted earnings 72.2 55.2

m m

Weighted average number of shares used in calculating adjusted basic earnings per share 780.2 780.2 Incremental shares in respect of employee share schemes 16.5 13.1

Weighted average number of shares used in calculating adjusted diluted earnings per share 796.7 793.3

Adjusted basic earnings per share (pence) 9.2 7.1 Adjusted diluted earnings per share (pence) 9.1 7.0


12. Income tax

Current taxation Note


£m


3 April 2016£m

Current tax on profit for the period 18.7 3.6 Adjustments in respect of prior periods (0.1) –

Total current tax charge 18.6 3.6

Deferred taxation

Origination and reversal of temporary differences (5.7) 1.7 Adjustments in respect of prior periods 2.7 – Changes in recognition of deferred tax 2.4 –Impact of change of UK tax rate (2.7) (9.1)

Total deferred tax credit 23 (3.3) (7.4)

Income tax charge/(credit) 15.3 (3.8)

The tax charge/credit for the period differs from the standard rate of corporation tax in the UK of 20.0% (2016: 20.2%). The differences are explained below:


£m


3 April 2016£m

Profit on ordinary activities before tax 56.4 3.9

Profit on ordinary activities multiplied by the rate of corporation tax in the UK of 20.0% (2016: 20.2%) 11.3 0.8 Effects of: Expenses not deductible for tax purposes 1.3 6.9 Income not subject to tax (0.4) (2.5)Reduction in UK tax rate (2.7) (9.1)Changes in recognition of deferred tax 2.4 (0.4)Effect of different tax rates on profits earned outside the UK 0.8 0.5 Adjustments in respect of prior periods 2.6 –

Total taxation charge/(credit) 15.3 (3.8)

The Group has operations across Europe, however, the principal location of trading where the majority of business profits are derived is the UK. The effective tax rate has therefore been referenced to the UK corporation tax rate of 20.0% for the period.

Effective tax rateThe effective tax rate for the year of 27.1% is higher than the standard rate of corporation tax in the UK as a result of significant or non-recurring items, rate change and the impact of higher income tax rates in Europe.

Changes in recognition of deferred tax relate to the net de-recognition of deferred tax on UK tax losses. Based on the nature of the losses and resulting restrictions on their use, it is not considered probable that the asset will be recoverable.

Excluding the impacts of rate changes, significant and non-recurring items and prior year adjustments, the Group has an underlying effective tax rate of 21.8%. This is higher than the 20.4% effective tax rate estimated in the Interim report for the six months ended 2 October 2016, primarily due to European business performance. The effective tax rate in 2017 will depend on the geographical mix of profits and changes to the legislation.

Reductions in UK tax rateReductions in the UK corporation tax rate to 19% (effective from 1 April 2017), 18% (effective 1 April 2020) and 17% (effective 1 April 2020) were substantively enacted prior to the balance sheet date. This will reduce the Group’s future tax charge accordingly. Deferred tax assets and liabilities reported at the balance sheet date have been measured using these rates.




Governance

13. Intangible assets

Goodwill

£m

Customer relationships

£mBrands

£mSoftware

£mTotal

£m

Cost At 1 January 2015 – – – – – Acquired through business combinations 846.6 400.5 161.0 43.7 1,451.8 Additions – – – 13.3 13.3 Disposals (2.9) – – (1.3) (4.2)Exchange difference 18.3 10.8 1.9 1.4 32.4

At 3 April 2016 862.0 411.3 162.9 57.1 1,493.3 Acquired through business combinations 73.0 45.1 5.9 0.3 124.3 Additions – – – 10.9 10.9 Disposals – – – (2.2) (2.2)Exchange difference 13.8 9.4 1.6 1.0 25.8

At 2 April 2017 948.8 465.8 170.4 67.1 1,652.1

Accumulated amortisation

At 1 January 2015 – – – – – Charge for the year – 22.0 8.8 12.8 43.6 Disposals – – – (0.8) (0.8)Exchange difference – 0.6 0.1 0.3 1.0

At 3 April 2016 – 22.6 8.9 12.3 43.8 Charge for the year – 25.2 9.4 14.8 49.4 Disposals – – – (1.5) (1.5)Exchange difference – 0.7 – 0.2 0.9

At 2 April 2017 – 48.5 18.3 25.8 92.6

Net book value At 3 April 2016 862.0 388.7 154.0 44.8 1,449.5

At 2 April 2017 948.8 417.3 152.1 41.3 1,559.5

Amortisation charges have been treated as operating costs in the income statement. Further details of intangible assets acquired through business combinations are disclosed in note 5.

GoodwillGoodwill acquired in a business combination is allocated to the cash-generating unit (‘CGU’) or group of CGUs that are expected to benefit from the synergies associated with that business combination. These CGU groups represent the lowest level within the Group at which the associated goodwill is monitored for management purposes. Goodwill is monitored by management at an operating segment level and has been allocated to operating segments as follows:

£m

Vehicle Remarketing – UK 536.5 Vehicle Remarketing – International 208.8 Vehicle Buying 115.9 Automotive Services 87.6

948.8

Goodwill is tested annually for impairment at each reporting date, or whenever there is an indication that the asset may be impaired, by comparing the carrying amount of these assets with their recoverable amounts which is derived from a value in use calculation. Where the recoverable amount exceeds the carrying amount of the assets, the assets are considered as not impaired. No impairment charges were incurred in the year ended 2 April 2017.

The budgets for the next financial year, which were subject to Board approval, form the basis of the cash flow projections for each CGU. Cash flow projections for the next four financial years reflect management’s expectations of the medium term operating performance of each CGU and growth prospects in the CGU’s markets and regions, and are based on the forecasts that were prepared at the time of the acquisition of the respective CGUs. Cash flow forecasts therefore cover a period of five years following the year end.


13. Intangible assets continuedOther key assumptions in the value in use calculation are shown below:

Vehicle Remarketing Vehicle Buying UK International Automotive Services

Growth rate applied beyond approved forecast period 1.8% 1.0% 1.8% 1.0% – 1.8%Pre-tax discount rate 10.6% 11.4% 10.0% 10.5% – 11.3%

Growth rates used do not exceed expectations of long-term growth in the local market.

The discount rate is estimated by the Group using a range of equity costs for similar companies and external market data, with samples chosen where applicable from the same markets or territories as the CGU.

The calculation of value in use for goodwill is sensitive to the following key assumptions:• Operating cash flow• Discount rate

The Directors consider that there is no reasonably possible change in the key assumptions made in their impairment calculations that would give rise to an impairment.

14. Property, plant and equipment

Land and buildings

£m

Fixtures, fittings and equipment

£m

Plant, machinery and motor

vehicles£m

Total£m

Cost At 1 January 2015 – – – – Acquired through business combinations 58.9 5.5 25.2 89.6 Additions 12.8 2.7 22.7 38.2 Disposals (5.8) (0.2) (3.6) (9.6)Exchange difference 3.4 0.5 0.3 4.2

At 3 April 2016 69.3 8.5 44.6 122.4 Acquired through business combinations (0.4) 1.0 7.5 8.1 Additions 20.6 5.4 33.6 59.6 Disposals (16.3) (2.3) (25.1) (43.7)Exchange difference 1.9 – 0.1 2.0

At 2 April 2017 75.1 12.6 60.7 148.4

Accumulated depreciation At 1 January 2015 – – – – Charge for the year 1.6 1.4 4.8 7.8 Disposals (0.1) – (1.7) (1.8)Exchange difference 0.6 0.2 0.1 0.9

At 3 April 2016 2.1 1.6 3.2 6.9 Charge for the year 2.2 2.5 9.6 14.3 Disposals (0.1) (2.3) (3.4) (5.8)Exchange difference (0.1) (0.1) (0.1) (0.3)

At 2 April 2017 4.1 1.7 9.3 15.1

Net book value At 3 April 2016 67.2 6.9 41.4 115.5

At 2 April 2017 71.0 10.9 51.4 133.3




Governance

Land and buildings includes assets under construction at the Manchester Belle Vue and Bedford sites with a net book value of £10.9m, which are not yet being depreciated. Land and buildings also includes an investment property which has been accounted for using the cost model.

Assets acquired through business combinations within land and buildings include a £1.0m write down of assets following the completion of acquisition accounting relating to the previous period. Please see note 5 for further details.

Finance lease commitmentsIncluded in property, plant and equipment are land and building assets held under finance leases with a net book value of £5.9m (2016: £3.4m) and accumulated depreciation of £3.8m (2016: £0.6m) and plant, machinery and motor vehicle assets under finance leases with a net book value of £31.8m (2016: £25.2m) and accumulated depreciation of £10.5m (2016: £2.1m).

15. Inventories

As at2 April 2017

£m

As at3 April 2016

£m

Gross inventories 59.1 19.6Inventory provision (0.8) (0.3)

Net inventories 58.3 19.3

Inventories recognised as an expense and charged to cost of sales for the year to 2 April 2017 were £1,318.0m (period to 3 April 2016: £657.8m). Write-down of inventories recognised as an expense in the year to 2 April 2017 amounted to £0.9m (period to 3 April 2016: £0.3m).

16. Trade and other receivables

As at2 April 2017

£m

As at3 April 2016

£m

Trade receivables not past due 228.2 147.6Trade receivables past due 49.2 26.5Provision for impairment (2.3) (2.0)

Trade receivables – net 275.1 172.1Other receivables 18.1 12.3Accrued income 22.2 7.9Prepayments 21.7 17.7

Total trade and other receivables 337.1 210.0

As at 2 April 2017 £113.4m (2016: £64.7m) of trade receivables were due from customers under the Partner Finance arrangements and are secured on vehicles held by those customers. Trade and other receivables are presented as current assets and there is no difference between the carrying amount and the fair value. Trade and other receivables are considered past due once they have passed their contracted due date. Movements on the Group provision for impairment of trade receivables are as follows:

As at2 April 2017

£m

As at3 April 2016

£m

At period start (2.0) –Acquired through business combinations (0.4) (1.4)Provision for receivables impairment (0.9) (1.0)Utilisation of provision during the period 0.7 0.3Unused amounts reversed 0.3 0.1

At year/period end (2.3) (2.0)

The creation and release of provisions for impaired receivables have been included in operating costs in the income statement.


16. Trade and other receivables continuedThe ageing of receivables is as follows:

As at2 April 2017

£m

As at3 April 2016

£m

Not past due and not impaired 228.2 147.6Up to 30 days overdue and not impaired 34.3 19.3Up to 30 days overdue and impaired 0.6 –Past 30 days overdue and not impaired 12.2 5.0Past 30 days overdue and impaired 2.1 2.2

Total trade receivables 277.4 174.1Impairment (2.3) (2.0)

Net trade receivables 275.1 172.1

17. Cash and cash equivalents

As at2 April 2017

£m

As at3 April 2016

£m

Cash at bank and in hand 84.4 102.4

Cash and cash equivalents are shown net of overdrafts. The Group has a legal right of offset over specified bank accounts. The gross cash and overdraft balances are shown below:

As at2 April 2017

£m

As at3 April 2016

£m

Gross amount of recognised financial assets: Cash at bank and in hand 91.2 109.5Gross amount of recognised financial liabilities set off in the balance sheet: Overdraft (6.8) (7.1)


18. Trade and other payables

As at 2 April 2017

£m

As at 3 April 2016

£m

Trade payables 186.6 139.8 Obligations under operating leases 68.8 66.9 Social security and other taxes 22.6 11.5 Accruals and other payables 151.6 68.9 Obligations under finance leases 30.8 26.9

Total trade and other payables 460.4 314.0

Trade and other payables – current 358.5 225.3 Trade and other payables – non-current 101.9 88.7





Governance

Obligations under operating leases reflect the fair value of current market terms of operating leases at acquisition, together with the cumulative difference between annual operating lease charges and cash payments made in accordance with the lease agreement. The Group also hold finance leases, further details of which can be seen as follows:

As at 2 April 2017

£m

As at 3 April 2016

£m

The minimum lease payments under finance leases fall due as follows:Not later than one year 6.7 5.0Later than one year but not more than five 24.5 20.9More than five years 2.4 4.1

Minimum lease payments 33.6 30.0Future finance charge on finance leases (2.8) (3.1)

Present value of finance lease liabilities 30.8 26.9

Of which:Not later than one year 5.7 4.1Later than one year but not more than five 22.7 18.8More than five years 2.4 4.0

Minimum lease payments 30.8 26.9

19. Bank borrowings

As at2 April 2017

£m

As at3 April 2016

£m

Non-currentBank borrowings 254.9 273.1

CurrentBank borrowings 90.0 –

In February 2017 the Group agreed a £500m multi-currency facility, including a £250m revolving facility and a £250m term loan. The term loan was drawn down in full and £90m of the revolving facility was also drawn down, net of transaction costs of £2.9m, and used to repay the previous debt facility held within the Group. The facility will run for four years with an option for a further 12 months by mutual consent, with no repayment of capital due before that time.

Carrying amounts are stated net of unamortised transaction costs. The transaction costs, together with the interest expense, are being allocated to the income statement over the term of the facility at a constant rate on the carrying amount. The fair value of bank borrowings is equal to the nominal value of the bank loan as the impact of discounting is not significant. The fair value of gross bank borrowings is £347.6m, (2016: £279.3m) which is equal to the nominal value. The effective interest rate including the impact of non-utilisation fees on the revolving facility and the utilisation fees for the letters of credit drawn down from the revolving facility, as well as the amortisation of debt issue costs is 3.0% (2016: 3.5%).

The Group’s principal bank loans at 2 April 2017 were denominated in Sterling £296.3m, (2016: £231.3m) and Euros €60.0m (2016: €60.0m), and bear variable interest based on LIBOR and EURIBOR respectively. They were secured by a fixed and floating charge over the Group’s present and future assets.

As part of the acquisition of Paragon during the year the Group also acquired an invoice discounting facility held within Paragon. This facility was repaid in February 2017 and has not been replaced.

At 2 April 2017, the Group had issued letters of credit in the ordinary course of business of £5.5m (2016: £5.5m) and drawn down £90.0m (2016: £nil) on the revolving facility, leaving the following as undrawn borrowing facilities:

As at2 April 2017

£m

As at3 April 2016

£m

Floating rate borrowingsExpiring beyond one year 154.5 94.5

For more information about the Group’s exposure to interest rate and foreign currency risk see note 27.


20. Partner Finance borrowingsThe Group has an asset-backed finance facility to fund the Partner Finance business. This is a revolving facility that allows a drawdown of up to £120.0m. The amount is advanced solely to a Partner Finance subsidiary in respect of specific receivables. Interest is charged on the drawn down element of the facility at a variable rate of interest, based on the Bank of England base rate. At 2 April 2017 the borrowings were £69.0m (2016: £40.2m).

21. Provisions

Onerous leaseprovision

£mOther

£mTotal

£m

At 4 April 2016 19.1 0.5 19.6Additional provisions 0.1 0.1 0.2Utilised (1.4) – (1.4)Unwinding of discounted amount 0.5 – 0.5

At 2 April 2017 18.3 0.6 18.9

Analysis of maturity profile:

As at2 April 2017

£m

As at3 April 2016

£m

Current 1.2 0.9Non-current 17.7 18.7

Total provisions 18.9 19.6

Onerous lease provisionPrior to the acquisition of the BCA Group two properties in the UK had been identified for which the Group had no future use. A provision exists for the minimum lease payments estimated to be paid until the end of the leases in 2031, net of management’s estimate as to likely revenues receivable in respect of sub leases or other uses of the properties. The future payments have been discounted, where appropriate, at the risk-appropriate rate of 3%.

Other provisionsThis balance primarily relates to a dilapidations provision, which was made in order to make good any defects within leasehold buildings used within the business and is expected to be utilised within the next ten years.

22. Pensions and other post-retirement benefits The Group participates in several defined contribution schemes and two defined benefit schemes (‘the BCA Pension Plan’ within the BCA Group and ‘the Automotive Plan’ within BCA Automotive).

The BCA Pension Plan provides benefits based on final pensionable salary. The plan is closed to new members. The valuation used for these accounts is based on the results of an actuarial valuation carried out as of 5 April 2014 and updated to the year end date by Capita, independent consulting actuaries, in accordance with IAS 19.

The Automotive Plan provides benefits based on final pensionable salary. The plan closed to future accrual from 1997. The valuation used for these accounts is based on the results of an actuarial valuation carried out as of 6 April 2013 and updated to the year end date by Broadstone, independent consulting actuaries, in accordance with IAS 19.

The defined benefit plans are registered with HMRC and comply fully with the regulatory framework published by the UK pensions regulator. Benefits are paid to the members from separate funds administered by independent trustees. The BCA Pension Plan has five trustees, three of whom are appointed by the Group and two chosen by scheme members. The Automotive Plan has four trustees, two of whom are appointed by the Group and two chosen by scheme members. The Trustees are required to act in the best interests of the members and are responsible for making funding and investment decisions in conjunction with the Group.




Governance

The principal assumptions used for the BCA Pension Plan and the Automotive Plan are as follows:

As at 2 April 2017 As at 3 April 2016

BCA Automotive BCA Automotive

Rate of increase in salaries 3.40% n/a 3.10% n/aRate of increase in deferred pensions 2.40% 2.40% 2.10% 2.10%Rate of increase in pensions:

LPI (5.0% Cap) 3.20% n/a 3.00% n/aLPI (2.5% Cap) 2.15% n/a 2.05% n/aFixed 3.00% Nil or 3.00% 3.00% Nil or 3.00%

Discount rate 2.50% 2.50% 3.45% 3.45%Rate of inflation: Retail price index 3.40% 3.40% 3.10% 3.10% Consumer price index 2.40% 2.40% 2.10% 2.10%

Assumptions regarding future mortality experience are set based on published statistics and experience.

The assumptions used by the actuary are the best estimates chosen from a range of possible actuarial assumptions which, due to the timescale covered, may not necessarily be borne out in practice.

The mortality assumptions adopted imply the following expected future lifetimes from age 65:


BCAAge

AutomotiveAge

BCAAge

AutomotiveAge

Males 23.0 23.0 22.9 22.2Females 25.0 25.0 24.9 24.4

The liability recognised in the consolidated balance sheet is determined as follows:


BCA£m

Automotive£m

Total£m

BCA£m

Automotive£m

Total£m

Present value of funded obligations (90.0) (14.8) (104.8) (73.8) (13.6) (87.4)Fair value of plan assets 73.9 13.6 87.5 68.0 11.8 79.8

Net pension liability (16.1) (1.2) (17.3) (5.8) (1.8) (7.6)

The amounts recognised in the income statement are as follows:

For the year ended 2 April 2017 For the 15 months ended 3 April 2016

BCA£m

Automotive£m

Total£m

BCA£m

Automotive£m

Total£m

Current service cost (0.9) – (0.9) (1.0) – (1.0)Net interest expense (0.2) (0.1) (0.3) (0.1) (0.1) (0.2)

Total amount charged to the income statement (1.1) (0.1) (1.2) (1.1) (0.1) (1.2)

The amounts recognised in the statement of comprehensive income are as follows:


BCA£m

Automotive£m

Total£m

BCA£m

Automotive£m

Total£m

Actuarial (losses)/gains on liabilities:Experience gains and losses 0.1 (3.0) (2.9) (0.1) 0.1 –Changes in financial assumptions (17.3) – (17.3) 3.8 – 3.8

Actuarial gains/(losses) on assets:Experience gains and losses 7.4 3.2 10.6 (4.1) 0.1 (4.0)

Total amount recognised in other comprehensive income (9.8) 0.2 (9.6) (0.4) 0.2 (0.2)


22. Pensions and other post-retirement benefits continuedAnalysis in the movement in the net liability:


BCA£m

Automotive£m

Total£m

BCA£m

Automotive£m

Total£m

At start of year/period (5.8) (1.8) (7.6) – – –Balance at acquisition – – – (5.0) (3.2) (8.2)Contributions by employer 0.6 0.5 1.1 0.7 1.3 2.0Actuarial (losses)/gains recognised in the period (9.8) 0.2 (9.6) (0.4) 0.2 (0.2)Net interest expense (0.2) (0.1) (0.3) (0.1) (0.1) (0.2)Current service cost (0.9) – (0.9) (1.0) – (1.0)

At end of year/period (16.1) (1.2) (17.3) (5.8) (1.8) (7.6)

Changes in the present value of the defined benefit obligation are as follows:


BCA£m

Automotive£m

Total£m

BCA£m

Automotive£m

Total£m

At start of year/period 73.8 13.6 87.4 – – –Balance at acquisition – – – 75.0 14.0 89.0Current service cost 0.9 – 0.9 1.0 – 1.0Interest expense on plan liabilities 2.4 0.5 2.9 2.4 0.3 2.7Actuarial losses/(gains):

Experience gains and losses (0.1) 3.0 2.9 0.1 (0.1) –Changes in financial assumptions 17.3 – 17.3 (3.8) – (3.8)

Contributions by employees 0.3 – 0.3 0.4 – 0.4Benefits paid (4.6) (2.3) (6.9) (1.3) (0.6) (1.9)

At end of year/period 90.0 14.8 104.8 73.8 13.6 87.4

Changes in the fair value of the defined benefit asset are as follows:


BCA£m

Automotive£m

Total£m

BCA£m

Automotive£m

Total£m

At start of year/period 68.0 11.8 79.8 – – –Balance at acquisition – – – 70.0 10.8 80.8Interest income on plan assets 2.2 0.4 2.6 2.3 0.2 2.5Employer contributions 0.6 0.5 1.1 0.7 1.3 2.0Actuarial gains/(losses):

Experience gains and losses 7.4 3.2 10.6 (4.1) 0.1 (4.0)Contributions by employees 0.3 – 0.3 0.4 – 0.4Benefits paid (4.6) (2.3) (6.9) (1.3) (0.6) (1.9)

At end of year/period 73.9 13.6 87.5 68.0 11.8 79.8

At the end of the reporting period the plan assets by category had been invested as follows:


BCA£m

Automotive£m

Total£m

BCA£m

Automotive£m

Total£m

Equities (quoted) 33.7 7.7 41.4 33.9 6.2 40.1Corporate bonds (quoted) 26.7 2.0 28.7 24.8 2.1 26.9Government bonds (quoted) 4.2 3.3 7.5 3.5 3.0 6.5Diversified growth funds (quoted) 9.3 – 9.3 5.5 – 5.5Other – 0.6 0.6 0.3 0.5 0.8

Total plan assets 73.9 13.6 87.5 68.0 11.8 79.8




Governance

Risk managementThese defined benefit plans expose the Group to actuarial risks, such as mortality risk, interest rate risk and market investment risk. The investment policies of each scheme are described below:

Asset volatility Plan liabilities, in respect of defined benefit obligations, are calculated on a discounted basis using a discount rate which is set with reference to corporate bond yields. If the plan assets underperform this yield, then this will create a deficit. The trustees of each plan, and their advisers, carry out regular reviews of asset allocations within each plan and consider the need to switch assets in line with the investment strategies. Currently the plans hold approximately 40% of assets as defensive assets (government and corporate bonds) with the intention of mitigating significant changes in yields.

As each plan matures, the level of investment risk is reduced by investing more in government and corporate bonds that better match the liabilities. However, the Group believes that due to the long term nature of the scheme liabilities, a level of continuing equity investment is an appropriate element of the long term investment strategy.

In respect of Guaranteed Minimum Pension (‘GMP’) obligations, the strategy has the objectives of achieving an overall rate of return that is sufficient to meet pensioners’ reasonable expectations, reduce investment return volatility over the short-term period to retirement where this is possible and to invest in assets that are liquid such that they enable switching between asset classes. In order to achieve these objectives, the strategy is to invest in a mixture of on-risk assets (including equities) and off-risk assets (including bonds, gilts and cash), with the proportionate allocation of the latter increasing according to an agreed profile as members approach their normal retirement date.

Inflation The plans’ pension liabilities in deferment are linked to inflation. Higher inflation will lead to higher liabilities, although in the majority of cases there are caps on the level of inflationary increases to be applied to pension obligations in order to protect the plans from extreme inflation. The BCA Pension Plan holds approximately 5% of the plans’ assets in index-linked bonds to partially hedge against this risk. The remainder of the plans’ assets are either unaffected by or loosely correlated with inflation, and so an increase in inflation can lead to an increase in the plan deficit.

Mortality The plans’ obligation is to provide a pension for the life of their members, so realised increases in life expectancy will result in an increase in the plans’ benefit payments. Whilst future mortality rates cannot be predicted with certainty the plans adopt up to date mortality assumptions and review the overall risk as part of the triennial actuarial valuations.

Bond yields Plan liabilities are likely to increase following a decrease in the interest rate. This is due to a reduction in the interest rate having the effect of a decrease in bond yields. This risk is partially mitigated by the level of defensive assets held by the plans, which will increase in value following a decrease in interest rate. If interest rates increase, the opposite is true for both plan liabilities and assets.

Salary changes The calculation of the BCA Pension Plan liabilities uses the future estimated salaries of plan participants. Increases in the salary of plan participants above that assumed will increase the plan liabilities.

The Automotive Plan is closed to future accruals, so is not exposed to this risk.

Sensitivity analysisThe disclosures above are dependent on the assumptions used. The table below demonstrates the sensitivity of the defined benefit obligations to changes in the significant assumptions used for the schemes.

Impact on the defined benefit obligations:

BCA£m

Automotive£m

BCA% of liability

Automotive% of liability

Discount rate: +0.25% (4.4) (0.5) (4.9%) (3.4%)

Inflation and related assumptions: +0.25% 3.5 0.2 3.9% 1.4%

Mortality: reduced by 10% 3.6 n/a 4.0% n/aMortality: Long-term rate of longevity improvement: +0.25% n/a 0.0 n/a 0.0%



22. Pensions and other post-retirement benefits continuedThe above analysis is based on a change in an assumption while holding all other assumptions constant, and in practice this is unlikely to occur. The above variances have been used as they are believed to be reasonably possible fluctuations.

Expected future cash flowsThe Group expects the employer contributions to be made to its defined benefit plans in the 2017/18 financial year to be £1.1m. The Group’s management do not expect any material changes to the annual cash contributions over the next three years; however it keeps contributions under review in the light of movements in the funding position of the schemes.

The defined benefit obligations are based on the current value of expected benefit payment cash flows to members over the next several decades. The average duration of the liabilities is approximately 21.5 years for the BCA Pension Plan and 22 years for the Automotive Plan.

23. Deferred tax

Deferred tax assets

Property, plant and

equipment£m

Operating lease

obligations£m

Pension deficit

£m

Losses carried

forward£m

Share based

payments£m

Other£m

Total£m

At 4 April 2016 4.1 2.9 1.5 6.9 – 0.5 15.9 Acquired through business combinations – – – 0.1 – 0.1 0.2 (Charged)/credited to the income statement (2.0) (0.3) (0.1) (3.8) 0.3 (0.3) (6.2)Charged to other comprehensive income – – 1.7 – 0.1 – 1.8 Exchange difference – – – 0.1 – – 0.1

At 2 April 2017 2.1 2.6 3.1 3.3 0.4 0.3 11.8

Deferred tax liabilities

Intangible Assets

£mOther

£mTotal

£m

At 4 April 2016 (109.9) (0.9) (110.8)Acquired through business combinations (9.3) (0.2) (9.5)Credited to the income statement 9.4 0.1 9.5Exchange difference (2.5) – (2.5)

At 2 April 2017 (112.3) (1.0) (113.3)

A deferred tax asset relating to UK tax losses of £5.2m has not been recognised as at 2 April 2017 (2016: £nil). Due to the nature of the losses and resulting restrictions on their use it is not expected that the asset will reverse in future periods based on current forecasts.

24. Share capital and reserves

Number of £0.01Ordinary shares

Nominalvalue

£m

Sharepremium

£m

Mergerreserve

£m

At 31 December 2014 25,041,670 0.3 28.7 –Issued in connection with the acquisition of BCA Group 755,205,522 7.5 1,021.7 103.6Share issue costs relating to equity – – (35.1) –Capital reduction – – (1,015.3) –

At 3 April 2016 and at 2 April 2017 780,247,192 7.8 – 103.6

The holders of Ordinary shares are entitled to receive dividends as declared and are entitled to one vote per share at meetings of the Company. The movements in share capital are described below:• On 2 April 2015, the Company issued 755,205,522 shares for the Placing as part of the acquisition of the BCA Group. 685,670,000

were issued for cash at a price of £1.50 each and 69,535,522 were issued as consideration for shares in the BCA Group at a fair value of £1.50 each. On the same date, all 780,247,192 Ordinary shares in issue were admitted to the Official List of the UK Listing Authority and to trading on the Main Market of the London Stock Exchange.

• On 3 June 2015, the Company cancelled its share premium account by Special Resolution as confirmed by an Order of the High Court of Justice, Chancery Division.



Governance

The following describes the nature and purpose of each reserve within shareholders’ equity:

Share premiumThe amount subscribed for share capital in excess of nominal value less any costs directly attributable to the issue of new shares.

Merger reserveThe amount in excess of nominal value of shares issued in exchange for shares on an acquisition in relation to section 612 of the Companies Act 2006.

Foreign exchange reserveThe foreign exchange reserve represents the difference arising from the changes to foreign exchange rates upon assets and liabilities of overseas subsidiaries.

Retained earnings Cumulative net gains and losses recognised in the Group income statement.

25. DividendsAn interim dividend of £17.2m, 2.20p per share (2016: £15.6m, 2.00p per share), was paid on 31 January 2017 to shareholders on the Register on 16 December 2016.

After the balance sheet date a final dividend of 4.55p per qualifying Ordinary share has been proposed by the Directors (2016: 4.00p per share), subject to approval by shareholders at the AGM. This will be payable on 29 September 2017 to shareholders on the Register on 15 September 2017. The final dividend has not been provided for.

26. Commitments and contingenciesCapital commitmentsCapital commitments at the year end were £20.3m (2016: £10.9m).

Operating lease commitmentsThe Group leases various properties and other assets under operating lease agreements. The non-cancellable lease terms are between three months and 60 years, and certain of the lease agreements are renewable at the end of the lease period at market rates.

The total future aggregate minimum lease payments under operating leases are as follows:


Land and buildings

£mOther

£m

Land and buildings

£mOther

£m

Within one year 38.9 7.4 31.5 4.9 Later than one year and less than five years 148.1 17.2 119.2 9.7 After five years 397.0 2.0 347.4 0.2

Total operating lease commitments 584.0 26.6 498.1 14.8

The total future aggregate minimum lease payments due to the Group under sub leases are £0.4m (2016: £4.1m).

ContingenciesThere are no disputes with any third parties that would result in a material liability for the Group.



27. Financial instruments – risk managementCategories of financial instruments

As at2 April 2017

£m

As at3 April 2016

£m

Financial assetsLoans and receivables 377.6 286.8

Financial liabilitiesAmortised cost 774.7 533.5

Loans and receivables include trade receivables, other receivables and cash and cash equivalents. Included in financial liabilities at amortised cost are trade and other payables excluding obligations under operating and finance leases, bank borrowings and Partner Finance borrowings.

Financial risk managementThe Group’s activities expose it to a variety of financial risks: market risk (including currency risk and interest rate risk), credit risk and liquidity risk. Risk management is carried out by the Audit & Risk Committee on behalf of the Board of Directors.

Market riskMarket risk is the risk that changes in market prices (principally exchange rates and interest rates) will affect the Group’s income or the value of its holdings of financial instruments.

Foreign exchange riskThe Group operates in the UK and continental Europe (Germany, France, Spain, Portugal, Netherlands, Italy, Denmark, Sweden, and Switzerland) and is therefore exposed to foreign exchange risk. Foreign exchange risk arises primarily on recognised assets and liabilities and net investments in foreign operations. These overseas operations’ revenues and costs are mainly denominated in the currencies of the countries in which the operations are located. The most significant of these is the Euro. The Euro to Sterling exchange rates used by the Group are shown below:


For the15 months

ended3 April 2016

Euro – opening (period start) 1.2503 1.3595Euro – average 1.1940 1.3500Euro – closing 1.1694 1.2503

The functional currencies of the revenue and adjusted EBITDA of the Group’s operations are as follows:


GBP Euro Other Total GBP Euro Other Total

Revenue (£m) 1,855.4 148.7 25.6 2,029.7 1,037.2 101.6 14.3 1,153.1Revenue (%) 91.4% 7.3% 1.3% 100.0% 90.0% 8.8% 1.2% 100.0%Adjusted EBITDA (£m) 106.0 22.9 6.7 135.6 79.6 15.0 3.9 98.5Adjusted EBITDA (%) 78.2% 16.9% 4.9% 100.0% 80.8% 15.2% 4.0% 100.0%

The Group does not have significant transactional foreign currency cash flow exposures. The Group monitors its exposure to currency fluctuations on an ongoing basis. The Group maintains part of its net debt in Euros to reflect the currency in which its EBITDA is generated.

The Group does not normally hedge profit translation exposures. During the year and as at 2 April 2017 the Group did not have any hedges in place.

For the year ended 2 April 2017, if Sterling had strengthened by 10% on average against the Euro with all other variables held constant, adjusted EBITDA for the period would have been £2.1m lower (2016: £1.4m lower) as a result of a reduction of the equivalent value in Sterling of profits denominated in Euros.



Governance

Details of the currencies in which the Group’s cash, trade and other receivables, trade and other payables and loans and overdrafts are denominated are set out below:


GBP£m

Euro£m

Other£m

Total£m

GBP£m

Euro£m

Other£m

Total£m

Cash 45.5 29.1 9.8 84.4 58.8 35.6 8.0 102.4 Trade and other receivables 281.0 45.9 10.2 337.1 160.9 39.4 9.7 210.0 Trade and other payables (368.8) (74.7) (16.9) (460.4) (236.6) (64.9) (12.5) (314.0)Borrowings (including Partner Finance

borrowings) (362.6) (51.3) – (413.9) (266.4) (46.9) – (313.3)

Net (404.9) (51.0) 3.1 (452.8) (283.3) (36.8) 5.2 (314.9)

Interest rate riskThe Group’s interest rate risk arises from the Group’s borrowings as disclosed in Note 19. Interest rates have been historically low and stable in terms of both LIBOR and EURIBOR rates and consequently no structured hedging has been implemented in the current period. The Group will continue to monitor interest rates and assess the requirement for hedging in the future. All of the Group’s finance leases are at fixed rates of interest.

For the period ended 2 April 2017, if the average rate on floating rate borrowings had been 50 basis points higher with all other variables held constant, post-tax profit for the period would have been £1.2m lower (2016: £1.1m lower).

Credit riskCredit risk is the risk of financial loss in the Group if a customer or counterparty to a financial instrument fails to meet its contractual obligations and arises principally through trade receivables from customers and cash balances.

The Group has policies in place to ensure that services are only provided to clients with an appropriate credit history.

Customers who have an account with BCA Partner Finance are able to finance vehicles acquired through UK Vehicle Remarketing. Prior to opening an account and subsequently, at least on an annual basis, a credit assessment is completed and appropriate security is obtained. In addition, legal title of the vehicle remains with the Group until the outstanding balance is settled in full.

Cash and cash equivalents are held with reputable institutions. The cash required for working capital is held with reputable banks in each country of operation as appropriate. All other material cash balances are deposited with financial institutions whose credit rating is at least Standard and Poors A- or equivalent.

Liquidity riskLiquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due.

Cash flow forecasting is performed in the operating entities of the Group and aggregated by Group Finance. Group Finance monitors forecasts of the Group’s liquidity requirements to ensure it has sufficient cash to meet operational needs while maintaining sufficient headroom on its undrawn committed borrowing facilities at all times so that the Group minimises the risk of breaching borrowing limits or covenants on any of its borrowing facilities. Such forecasting takes into consideration the Group’s debt financing plan and covenant compliance requirements on its borrowings.

The Group has a £250m (2016: £100m) revolving facility. At 2 April 2017 £90.0m (2016: £nil) of the facility had been drawn, as well as £5.5m (2016: £5.5m) of the facility having been utilised to provide guarantees to third parties. This revolving facility is considered by management to provide adequate flexibility given the current liquidity of the business.



27. Financial instruments – risk management continuedThe table below analyses the Group’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amounts disclosed in the tables below are the contractual undiscounted cash flows:

As at 2 April 2017

Carryingamount

£m

Contractualtotal

£m

Within1 year

£m

Between 1and 2 years

£m


£m

Over 5 years

£m

Bank borrowings 344.9 347.6 90.0 – 257.6 –Partner Finance borrowings 69.0 69.0 69.0 – – –Trade and other payables 460.4 391.6 356.2 15.7 17.3 2.4

As at 3 April 2016

Carryingamount

£m

Contractualtotal

£m

Within1 year

£m


£m


£m

Over5 years

£m

Bank borrowings 273.1 279.3 – – 279.3 –Partner Finance borrowings 40.2 40.2 40.2 – – –Trade and other payables 314.0 247.1 218.8 5.4 18.9 4.0

Capital risk managementThe Board’s policy is to maintain a strong capital base (which comprises share capital, reserves and net debt excluding finance leases and Partner Finance borrowings) so as to maintain creditor and market confidence and to sustain future development of the business. There were no changes in the Group’s approach to capital management during the period.

Fair valueThe fair values of all financial instruments are equal to their carrying value.

28. Related party transactionsRemuneration of the Directors, who constitute the key management personnel of the Group, has been disclosed in the Remuneration Committee report on pages 52 to 60. Other related party transactions with the Group are as follows:

Transaction amount Balance owed/(owing)

Related party relationship


£m


3 April 2016£m

As at2 April 2017

£m

As at3 April 2016

£m

BCA Gestão de Pátios S.A. – (0.1) – 0.1Marwyn Capital LLP (0.7) (7.7) – –Axio Capital Solutions Ltd – (0.1) – –

Payments to Marwyn Capital LLP relate to acquisition fees, corporate finance advisory fees and ongoing administrative and office services.

Axio Capital Solutions Ltd, a company related to Marwyn, provides company secretarial services. BCA Gestão de Pátios S.A., a joint venture, was disposed of on 15 June 2016.

The Group has not made any provision for bad or doubtful debts in respect of related party debtors, nor has any guarantee been given during the period regarding related party transactions.

29. Share based paymentsAs at 2 April 2017, share based incentives are in place for senior executives within the Group. These arrangements are based around shares in H.I.J. Limited (‘H.I.J.’) and are subject to the Share Incentive Scheme Cap (‘the Incentive Cap’), which restricts the aggregate value of all share incentives in place to a maximum value of 10% of the growth in Shareholder Value, which is broadly defined as the increase in market capitalisation of all Ordinary shares of the Company issued up to the date of vesting, allowing for any dividends and other capital movements.

The Group has the option to settle all incentives in issue either for cash or for the issue of new Ordinary shares at its discretion. It is assumed that the incentives will be settled by the issue of new Ordinary shares.



Governance

There are two incentive schemes in place as at 2 April 2017, the H.I.J. scheme (which applies to the Company and the Group) and the Performance based scheme (which applies to the Group only).

(a) The H.I.J. scheme is subject to both a Growth condition and the satisfaction of at least one of the Vesting conditions.i. Growth conditionThe Growth condition requires that the average compound annual growth of the Company’s equity value must be at least 10% per annum. The Growth condition is measured from 10 November 2014, when the Company was admitted to trading on AIM (‘AIM Admission’) and takes into account new shares issued, dividends and capital returned to shareholders.

ii. Vesting conditionsAt least one of the Vesting conditions must be (and continue to be) satisfied. The vesting period ends on the fifth anniversary of Admission, being 10 November 2019.

The Vesting conditions are as follows:• a sale of all or a material part of the business of H.I.J. Ltd;• a sale of all of the issued Ordinary shares of H.I.J. Ltd occurring;• a winding up of the H.I.J. Ltd occurring;• a sale or change of control of the Company; or• it is later than the third anniversary of AIM Admission.

(b) The Performance based scheme is subject to the same Growth condition and Vesting conditions described above and in addition is also subject to further Performance conditions.

iii. Performance conditionsPerformance conditions are based on the business’s key performance indicators (‘KPIs’) including volumes, average revenue/unit and EBITDA. Under these measures, points accrue over a three-year period starting with the year ending 3 April 2016, which determine the proportion of the scheme that will vest, up to a maximum of 1.5% of the growth in Shareholder Value. For example, if 50% of the points available from these KPIs are earned, then 50% of the 1.5% (0.75%) will be available under the Performance based scheme.

Any share of the growth in Shareholder Value not earned through achievement of KPIs will revert to the H.I.J. scheme, such that, subject to the Growth condition and the Vesting conditions, all of the Incentive Cap will vest.

The incentive holders have agreed that if they cease to be involved with the Group during the performance period then in certain circumstances a proportion of their incentives may be forfeited.

The share based incentives in issue are shown in the table below:

Date issuedNumber of H.I.J.

sharesNominal value of

H.I.J. sharesSubscription value

of H.I.J. shares

Current participation in

increase in Shareholder Value

At 31 December 2014 405,000 £4,050 £4,050 6.46%

For the 15 months ended 3 April 2016Issued during the period:H.I.J. scheme 15 June 2015 101,423 £1,014 £5,071 1.62%H.I.J. scheme 22 October 2015 26,654 £267 £1,999 0.42%Performance based scheme 14 December 2015 n/a n/a n/a 1.50%

At 3 April 2016 and 2 April 2017H.I.J. scheme 533,077 £5,331 £11,120 8.50%Performance based scheme n/a n/a n/a 1.50%

Total Incentive Cap 10.00%

Valuation of share based incentives The share based incentives have been assumed to be equity-settled and have been accounted for in accordance with IFRS 2.

The value of the services received in exchange for the share based incentives is measured by reference to the fair value of the incentives at their grant date. The fair value is recognised in the consolidated income statement, together with a corresponding increase in shareholders’ equity, on a straight-line basis over the vesting period, based on an estimate of the number of shares that will ultimately vest.

Vesting conditions, other than market conditions, are not taken into account when estimating the fair value. Market conditions are those conditions that are linked to the share price of the Group.



29. Share based payments continuedAt the end of each reporting period the Group revises its estimates of the number of shares that are expected to vest due to non-market conditions. It recognises the impact of the revision to original estimates, if any, in the consolidated income statement, with a corresponding adjustment to shareholders’ equity. At the year end the Group expects all share based incentives to vest in full.

H.I.J. shares (1st issue) H.I.J. shares (2nd issue) Performance based scheme

Date of issue 11 July 2014 and 15 June 2015 22 October 2015 14 December 2015

Number of shares granted 506,423 26,654 n/a

Exercise price n/a n/a n/a

Vesting period From the thirdanniversary of Admission

to the fifth anniversary

From the thirdanniversary of Admission

to the fifth anniversary

From 30 September 2018

Vesting date assumed for thecalculation of fair value

10 November 2018 10 November 2017 30 September 2018

Fair value of incentives at grant £268,000 £1,030,977 £3,060,266

During the period, £1.6m (2016: £0.6m) has been recognised in the consolidated income statement as a charge in relation to the share based incentives. The value of the share based incentives granted under the scheme has been calculated using a Monte Carlo model:

• The fair value of the issue on 11 July 2014 was performed prior to the Admission of the Group to AIM and is therefore based on a weighted average estimate of £20m raised on Admission and volatility of 20% based on a weighted average share price over the vesting period. The issue of shares on 15 June 2015 was part of a reduction in the value of those share incentives, as a result of the introduction of the Incentive Cap, and therefore no further assessment of fair value was required.

• The fair values of the issues on 22 October 2015 and 14 December 2015 are based on the market capitalisation of the Group at the date of their grant and volatility of 20% based on an analysis of the share price volatility of a sample of the Group’s peer group.

Investor Founder SharesDuring the period ended 31 December 2014, 194,996 Investor Founder Shares with an aggregate issue price and nominal value of £1,950 were issued to a number of Investor Founders that participated in the initial placing on AIM on 10 November 2014. The Investor Founder Shares were subject to similar growth and vesting conditions as the H.I.J. shares and as at 31 December 2014 could each be sold to the Group for an aggregate value equivalent to a maximum of 6.5% of the increase in Shareholder Value in the Group. As part of the Placing to acquire the BCA Group on 2 April 2015 it was agreed that the Investor Founder Shares would be forfeited and as such all Investor Founder Shares were repurchased by the Group at their nominal value of £1,950 and then cancelled.

The Investor Founder Shares Scheme has been accounted for in accordance with the requirements of IAS 32 as a financial liability at fair value as the incentive scheme does not include a service requirement. Following the cancellation of the Investor Founder Shares the charge of £277 made in the period ended 31 December 2014 was reversed during the prior period.

30. Events after the reporting periodAfter the balance sheet date, deferred consideration in respect of the Paragon acquisition was paid (see note 5).



Governance

31. List of Group undertakingsAll companies are 100% owned unless otherwise stated.

Group undertaking Nature of businessCountry ofincorporation Registered Office

Autolink Ltd Dormant England and Wales Headway House, Crosby Way,Farnham, Surrey GU9 7XG

Autotrax Ltd (76%) Property Leasing England and Wales Headway House, Crosby Way,Farnham, Surrey GU9 7XG

BC Autolicitatii România - S.R.L Dormant Romania Bucharest, 1st district, BuzestiSt. no. 50-52, module 12, 11th floor

BC Remarketing S.A. Motor Vehicle Remarketing France 5 rue Charles de Gaulle - 94140Alfortville

BCA Administratie B.V. Vehicle Sale and Purchase Netherlands De Landweer 4, 3771 LN BarneveldBCA Auctions GmbH Motor Vehicle Remarketing Germany Flosshafenstrasse 5, 41460

Neuss, GermanyBCA Auctions Holdings B.V. Intermediate Parent Netherlands De Landweer 4, 3771 LN BarneveldBCA Autoauktion A/S Motor Vehicle Remarketing Denmark Auktionsvej 8, DK-7120, VejleBCA Autoauktionen GesmbH Non-trading Austria Börsegasse 10/5, 1010 WienBCA Autoauktionen GmbH Motor Vehicle Remarketing Germany Flosshafenstrasse 5, 41460

Neuss, GermanyBCA Automotiv GmbH & Co. KG Motor Vehicle Remarketing Germany Flosshafenstrasse 5, 41460

Neuss, GermanyBCA Automotiv Verwaltungs GmbH Intermediate Parent Germany Flosshafenstrasse 5, 41460

Neuss, GermanyBCA Automotive Ltd Dormant England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGBCA AutoRemarketing Schweiz Motor Vehicle Remarketing Switzerland Industriepark / LC2,

CH – 6246 AltishofenBCA Autoveiling – Enchères Autos S.A. Non-trading Belgium Rue de l’Hospice Communal 35 –

1170 Watermael-BoitsfortBCA Autoveiling B.V. Motor Vehicle Remarketing Netherlands De Landweer 4, 3771 LN BarneveldBCA Central Ltd Intermediate Parent and

Management Service CompanyEngland and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGBCA España Autosubastas de

Vehículos SLMotor Vehicle Remarketing Spain Sagasta, 15 Planta 2 puerta

Izquierda 28004 MadridBCA Europe Ltd Intermediate Parent and England and Wales Headway House, Crosby Way,

Management Service Company Farnham, Surrey GU9 7XGBCA Fleet Solutions Ltd Motor Vehicle Processing Services England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGBCA Fleet Solutions 2 Ltd Vehicle Rectification Services England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGBCA Group Europe Ltd Intermediate Parent England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGBCA Holdings Germany GmbH Intermediate Parent Germany Flosshafenstrasse 5, 41460

Neuss, GermanyBCA Holdings Ltd Intermediate Parent England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGBCA Hungária Gépjárm-aukciós Kft. Dormant Hungary 1061 Budapest, Andrássy út 36.

2. em. 5. , MagyarországBCA Italia SRL Motor Vehicle Remarketing Italy Via Emilia 143/A, Lodi 26900BCA Logistics Ltd Motor Vehicle Distribution England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGBCA Ltd Dormant England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGBCA Management de Vehiculos SL Vehicle Sale and Purchase Spain Sagasta, 15 Planta 2 puerta

Izquierda 28004 MadridBCA Osprey Finance Ltd Dormant England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XG




BCA Osprey I Ltd Intermediate Parent England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

BCA Osprey II Ltd Intermediate Parent England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

BCA Outsource Solutions Ltd Motor Vehicle Remarketing England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

BCA Pension Trustees Ltd Dormant England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

BCA Polska Sp. z o.o. Motor Vehicle Remarketing Poland Klaudyn, 5 Estrady str,05-080 Izabelin

BCA Remarketing Group Ltd Intermediate Parent England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

BCA Remarketing Solutions Ltd Motor Vehicle Remarketing England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

BCA Servicios Inmobiliarios SL Property Leasing Spain Sagasta, 15 Planta 2 puerta Izquierda 28004 Madrid

BCA Trading Ltd Intermediate Parent England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

BCA Vehicle Finance Ltd Motor Vehicle Finance England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

BCA Vehicle Remarketing AB Motor Vehicle Remarketing Sweden Box 5208,151 13 Södertälje

BCA Vehicle Services Ltd Motor Vehicle Processing Services England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

BCAuto Enchères S.A. Motor Vehicle Remarketing France 5 rue Charles de Gaulle – 94140 Alfortville

British Car Auctions Ltd Motor Vehicle Remarketing England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Burrpark Ltd Supply of Labour and Equipment Scotland BCA Kinross, Bridgend, KinrossKY13 8EN

Carland.com Ltd (84%) Motor Vehicle Remarketing England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

CarTrade2B AB Vehicle Sale and Purchase Sweden Box 5208,151 13 Södertälje

CarTrade2B GmbH Vehicle Sale and Purchase Germany Flosshafenstrasse 5, 41460 Neuss, Germany

CD&R Osprey Investment S.à r.l. Dormant Luxembourg 5, Rue Guillaume J. Kroll, Luxembourg, Luxembourg

Expedier Catering Ltd Catering England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Expert Remarketing Ltd Dormant England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Fleet Control Monitor GmbH (76%) Vehicle Inventory Management Germany Alsfelder Str. 23, 36272 Niederaula, Germany

FleetSelect B.V. Motor Vehicle Remarketing Netherlands De Landweer 4, 3771 LN BarneveldG – Grupo – Investimentos e

Participações, S.A.Intermediate Parent Portugal Av. Antonio Augusto de Aguiar,

38 – 6º, 1050-016 LisboaH.I.J. Ltd Intermediate Parent Jersey One Waverley Place, Union Street,

St Helier, Jersey JE1 1AXLife on Show Ltd (51%) Supply of Photographic Software to

the Automotive IndustryEngland and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGMagna Motors Ltd Dormant England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGMotor Auctions (Properties) Ltd Property Leasing Scotland BCA Kinross, Bridgend, Kinross

KY13 8ENNKL Automotive Ltd Provision of Logistics Labour England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGParagon Automotive 2009 Ltd Property Leasing England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XG

31. List of Group undertakings continued



Governance


Paragon Automotive Logistics Ltd Motor Vehicle Distribution England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Paragon Automotive Ltd Dormant England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Paragon Automotive Services Ltd Property Leasing England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Paragon Fleet Solutions Ltd Marketing and Support Services to the Vehicle Manufacturing Industry

England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Paragon Remarketing Services Ltd Motor Vehicle Remarketing England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Paragon Vehicle Services Ltd Dormant England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Pennine Metals B Ltd Intermediate Parent England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

S.P.L.A. – Sociedade Portuguesa de Leliões de Automóveis, S.A.

Motor Vehicle Remarketing Portugal Av. Antonio Augusto de Aguiar, 38 –6º, 1050-016 Lisboa

Scottish Motor Auctions (Holdings) Ltd Dormant England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Scottish Motor Auctions Ltd Dormant Scotland BCA Kinross, Bridgend, Kinross KY13 8EN

Sensible Automotive Ltd Distribution and Vehicle Services for the Automotive Sector

England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

SMA Vehicle Remarketing Ltd Motor Vehicle Remarketing England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Smart Prepared Systems Ltd Dormant England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

Supreme Wheels Direct Ltd (75%) Vehicle Rectification Services England and Wales Headway House, Crosby Way, Farnham, Surrey GU9 7XG

T4g One Europe ApS Vehicle Sale and Purchase Denmark Auktionsvej 8, DK-7120, VejleTF1 Ltd Intermediate Parent England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGThe British Car Auction Group Ltd Intermediate Parent England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGTradeouts Ltd (51%) Provision of Online Dealer to Dealer

Platforms for Online SalesEngland and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGVAM UK Acquisition Corporation Ltd Intermediate Parent England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGWalon Automotive Services Ltd Dormant England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGWalon Ltd Logistics Services for the Automotive

SectorEngland and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGWe Buy Any Car Ltd Vehicle Sale and Purchase England and Wales Headway House, Crosby Way,

Farnham, Surrey GU9 7XGZABATUS Gründstucks –

Vermietungsgesellschaft mbH & Co. Objekt BCA Neuss KG (94%)

Property Leasing Germany Königsallee 106, 40216 Düsseldorf, Germany

Financial statements for all of the companies listed can be requested from the Company Secretary BCA Bedford, Coronation Business Park, Kempston Hardwick, Bedford MK43 9PR.


Company balance sheet

Company financial statements

Note

As at2 April 2017

£m

As at3 April 2016

£m

Non-current assetsProperty, plant and equipment 0.2 –Investments 3 1,067.6 1,067.6

Total non-current assets 1,067.8 1,067.6

Current assetsTrade and other receivables 4 0.3 17.1Cash and cash equivalents 5 0.4 3.7

Total current assets 0.7 20.8

Total assets 1,068.5 1,088.4

Current liabilitiesTrade and other payables 6 (33.7) (2.5)

Total liabilities (33.7) (2.5)

Net assets 1,034.8 1,085.9

Equity shareholders’ fundsShare capital 7 7.8 7.8Merger reserve 7 103.6 103.6Retained profit 923.4 974.5

Total shareholders’ funds 1,034.8 1,085.9

The Company has elected to take the exemption under section 408 of the Companies Act 2006 not to present the Parent Company profit and loss account and the related notes. The loss for the Parent Company for the year ended 2 April 2017 was £4.3m (15 month period ended 3 April 2016: loss of £25.5m).

The financial statements on pages 108 to 113 were approved by the Board on 26 June 2017 and were signed on its behalf by:

Avril Palmer-Baunack Tim LampertExecutive Chairman Chief Financial Officer



Governance

Company statement of changes in equity


Note

Sharecapital

£m

Sharepremium

£m

Mergerreserve

£m

(Accumulateddeficit)/

retained profit£m

Total£m

Balance at 31 December 2014 0.3 28.7 – (0.3) 28.7Total comprehensive income for the periodLoss for the period – – – (25.5) (25.5)

Total comprehensive loss for the period – – – (25.5) (25.5)Contributions and distributionsNet proceeds from shares issued 7 7.5 986.6 103.6 – 1,097.7Capital reduction 7 – (1,015.3) – 1,015.3 –Dividends paid 8 – – – (15.6) (15.6)Share based payments 11 – – – 0.6 0.6

Total transactions with owners 7.5 (28.7) 103.6 1,000.3 1,082.7

Balance at 3 April 2016 7.8 – 103.6 974.5 1,085.9

Total comprehensive income for the yearLoss for the year – – – (4.3) (4.3)

Total comprehensive loss for the year – – – (4.3) (4.3)Contributions and distributionsDividends paid – – – (48.4) (48.4)Share based payments – – – 1.6 1.6

Total transactions with owners – – – (46.8) (46.8)

Balance at 2 April 2017 7.8 – 103.6 923.4 1,034.8


Company cash flow statement



£m


3 April 2016£m

Cash flows from operating activitiesLoss for the year/period (4.3) (25.5)Adjustments for:

Finance income – (0.2)Depreciation 0.1 –Equity-settled share based payments 1.6 0.6Acquisition related costs 1.9 23.0

Changes in working capital:Trade and other receivables 0.1 (0.4)Trade and other payables (0.2) 1.8

Cash outflow from operations (0.8) (0.7)Interest received – 0.2

Net cash outflow from operating activities before acquisition related costs (0.8) (0.5)Acquisition related costs (1.9) (22.4)

Net cash outflow from operating activities (2.7) (22.9)

Cash flows from investing activitiesPurchase of property, plant and equipment (0.4) –Proceeds from sale of property, plant and equipment 0.1 –Acquisition of subsidiary undertaking – (711.2)Capital contribution to subsidiary undertaking – (252.1)

Net cash outflow from investing activities (0.3) (963.3)

Cash flows from financing activitiesProceeds of share issue – 993.4Amounts loaned from/(to) subsidiary undertakings 48.1 (16.7)Dividends paid (48.4) (15.6)

Net cash (outflow)/inflow from financing activities (0.3) 961.1

Net decrease in cash and cash equivalents (3.3) (25.1)Cash and cash equivalents at period start 3.7 28.8

Cash and cash equivalents at year/period end 0.4 3.7



Governance

Notes to the Company financial statements

1. Accounting policiesBasis of preparationThese Company financial statements for the year ended 2 April 2017 have been prepared in accordance with International Financial Reporting Standards (‘IFRS’) and IFRS Interpretations Committee (‘IFRS IC’) interpretations as adopted by the European Union (‘Adopted IFRS’) and with those parts of the Companies Act 2006 applicable to companies reporting under IFRS. The accounting policies have, unless otherwise stated, been applied consistently to all periods presented in these financial statements. The financial statements have been prepared under the historical cost convention.

The financial statements and the notes to the financial statements are presented in millions of pounds sterling (‘£m’) except where otherwise indicated.

The accounting policies applied in the preparation of these Company financial statements are the same as those set out in note 2 of the Group financial statements, with the exception of section 2(c) ‘Basis of consolidation’ and the policy on investments in subsidiaries, which are stated at cost less impairment.

2. Employees and DirectorsStaff costs for the Company during the year/period:

Note


£m


3 April 2016£m

Wages and salaries 3.1 8.7 Pension costs 0.1 0.1 Social security costs 0.7 1.2 Share based payment expense 11 1.6 0.6

Total employment cost expense 5.5 10.6

The average monthly number of people employed (including Executive Directors) during the year to 2 April 2017 was 12 (period to 3 April 2016: 8 people). Employment costs for the period ended 3 April 2016 included a completion bonus in relation to the acquisition of the BCA Group. For details and Directors’ emoluments information see the Remuneration Committee report on pages 52 to 60. The Company offers membership to a defined contribution scheme, the pension cost in the year to 2 April 2017 was £0.1m (period to 3 April 2016: £0.1m).

3. Investments in subsidiaries

Total£m

Cost

At 3 April 2016 and 2 April 2017 1,067.6

At 2 April 2017 the Company owns 100% of the issued share capital of H.I.J. Ltd, a company incorporated in Jersey, and owns indirectly the subsidiary undertakings listed in note 31 of the consolidated accounts.

4. Trade and other receivables

As at2 April 2017

£m

As at3 April 2016

£m

Other receivables 0.3 0.4Amounts owed by subsidiary undertakings – 16.7

Total trade and other receivables 0.3 17.1

5. Cash and cash equivalents

As at2 April 2017

£m

As at3 April 2016

£m



6. Trade and other payablesAs at

2 April 2017£m

As at3 April 2016

£m

Trade payables – 0.2Social security and other taxes 0.1 0.1Accruals and other payables 2.1 1.8Amounts owed to subsidiary undertakings 31.5 0.4


7. Share capital and reservesThe details of the Company’s share capital and the nature of the reserves are disclosed in Note 24 of the consolidated financial statements.

8. DividendsThe details of the Company’s dividends are disclosed in Note 25 of the consolidated financial statements.

9. Financial instruments – risk managementFinancial risk managementThe Company’s activities expose it to a variety of financial risks: market risk (including currency and interest rate risk), credit risk and liquidity risk. Risk management is carried out by the Audit & Risk Committee on behalf of the Board of Directors.

Market riskMarket risk is the risk that changes in market prices (principally exchange rates and interest rates) will affect the Company’s income or the value of its holdings of financial instruments.

Foreign exchange riskThe Company has no direct significant interaction with foreign currency. Members of the Group in which the Company holds its investment operate in continental Europe, which means that through its investment the Company has some indirect exposure to foreign exchange risk.

Interest rate riskThe Company has no external debt and therefore has no significant exposure to interest rate risk. The intercompany loans within trade and other payables are at a floating interest rate.

Credit riskCredit risk is the risk of financial loss in the Company if a counterparty to a financial instrument fails to meet its contractual obligations and arises principally through receivables from Group companies and cash balances.

Cash and cash equivalents are held with reputable institutions. All material cash amounts are deposited with one of the Group’s principal bank service providers in the UK.

Liquidity riskLiquidity risk is the risk that the Company will not be able to meet its financial obligations as they fall due.

The Company’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufficient liquidity to meet its liabilities when due, under both normal and stressed conditions, without incurring unacceptable losses or risking damage to the Company’s reputation.

The Company currently meets all liabilities from cash reserves and intercompany loans. The Company’s liability for operating expenses is monitored on an ongoing basis to ensure cash resources are adequate to meet liabilities as they fall due.

Notes to the Company financial statements



Governance

The table below analyses the Company’s non-derivative financial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the contractual maturity date. The amounts disclosed in the tables below are the contractual undiscounted cash flows:

As at 2 April 2017

Carryingamount

£m

Contractualtotal

£m

Within1 year

£m


£m


£m

Over5 years

£m

Trade and other payables 33.7 33.7 33.7 – – –

As at 3 April 2016

Carryingamount

£m

Contractualtotal

£m

Within1 year

£m


£m


£m

Over5 years

£m

Trade and other payables 2.5 2.5 2.5 – – –

Capital risk managementThe aim of the Company is to maintain sufficient funds to enable it to make suitable investments and incremental acquisitions whilst minimising recourse to bankers and/or shareholders.

Fair valuesThe fair values of all financial instruments in both periods are equal to their carrying values.

10. Related party transactionsRemuneration of the Directors’ who constitute key management personnel of the Company, has been disclosed in the Remuneration Committee report on pages 52 to 60. Other related party transactions with the Company are as follows:

Transaction amount Balance owed/(owing)

Related party relationship


£m


3 April 2016£m

As at2 April 2017

£m

As at3 April 2016

£m

Subsidiaries:Amounts owed to the Company (loan) – – – 16.7Amounts owing by the Company – – (31.5) (0.4)Management fees 4.9 2.3 – –Interest income (0.1) 0.1 – –Other:Marwyn Capital LLP (0.7) (7.7) – –Axio Capital Solutions Ltd – (0.1) – –

Payments to Marwyn Capital LLP relate to acquisition fees, corporate finance advisory fees and ongoing administrative and office services.

Axio Capital Solutions Ltd, a company related to Marwyn, provides company secretarial services.

The Company has not made any provision for bad or doubtful debts in respect of related party debtors nor has any guarantee been given during the period regarding related party transactions.

11. Share based paymentsThe details of the Company’s share based payments are set out in Note 29 in the consolidated financial statements.

12. Commitments and contingenciesCapital commitmentsThere are no capital commitments at either period end to disclose in this report.

ContingenciesThere are no disputes with any third parties that would result in a material liability for the Company.

The Company has entered into an agreement over various bank loans and overdrafts of certain Group undertakings and has granted as security a fixed and floating charge over all its present and future assets. At the year/period end the loans totalled £347.6m (2016: £279.3m).


Shareholder information

Advisers and Registrar

Financial Adviser and Joint BrokerCenkos Securities plc

Joint BrokerJ.P. Morgan Cazenove

AuditorPricewaterhouseCoopers LLP

SolicitorsBerwin Leighton Paisner LLP

PR advisersSquare 1 ConsultingBell Pottinger

RegistrarCapita Asset Services

Group Legal Director and Company Secretary Martin Letza

ISIN: GB00BP0S1D85Ticker: BCA

Registered OfficeBCA Marketplace plcBCA BedfordCoronation Business ParkKempston HardwickBedford MK43 9PRCompany Number: 09019615

Website: www.bcamarketplaceplc.com

BCA Marketplace plcBCA BedfordCoronation Business ParkKempston HardwickBedfordMK43 9PR

For more informationwww.bcamarketplaceplc.com

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