AIM RULE 26
This information is disclosed for the purposes of Rule 26
A description of its business and where it is an investing company, its investing strategy Boxhill is a diversified company delivering best in class products focused on lotteries and e-commerce. Each of our divisions enjoys long standing relationships with blue chip clients including household names and leading charities. Boxhill will continue to deliver or acquire new products and businesses, with a particular focus on gaming and lotteries and payment processing, underpinned by a solid asset base.
Our lottery has been in operation since 2002 and we hold a coveted UK external lottery managers licence. We have raised over £5.4 million for good causes and paid prizes to over 1 million winners.
Online purchases are the life blood of almost every consumer facing company in the developed world. Boxhill group have a range of products that suit all merchant’s needs, working within both regulated frameworks and in regions where regulation is scant.
For Merchants we have developed smart switch technology that may improve successful transactions while reducing ongoing costs, we can de-risk certain transactions and reduce time to settlement, improving all important cash flow.
For consumers we are able to protect sensitive information from merchants or individuals you may wish to send money to. We have tailored solutions for the unbanked or those who have been left out of traditional retail bank environments.
Boxhill has a range of peer to peer and consumer products covering a broad spectrum of local and international needs.
Names and biographies of directors
Lord Timothy Razzall, Executive Chairman
Lord Razzall is a qualified solicitor, the Liberal Democrat spokesperson on Trade and Industry and has more than 35 years’ experience in corporate finance, mergers and acquisitions. He is the founder of Argonaut Associates which provides management, financial and corporate advisory services to entrepreneurs and corporate clients. He has chaired several quoted companies and was awarded the title of European Lawyer of the year in 1992.
Andrew J A Flitcroft – Financial Director
Mr Flitcroft is a Fellow of the Institute of Chartered Accountants in England and Wales having qualified as a chartered accountant in 1992 and worked in private practice up until 1999. Subsequently Mr Flitcroft worked in senior finance roles for companies in the technology, internet and services sectors and more recently as a consultant and director for a number of Listed and Venture Capital funded businesses. Mr Flitcroft has a broad range of experience in accounting and reporting for listed enterprises on the UK AIM, PLUS Markets and Nasdaq in the United States.
Clive Hyman – Non-Executive Director
Mr Hyman has over 30 years of experience as a financial professional. He is a Fellow of the Institute of Chartered Accountants in England & Wales, having practiced at KPMG from 1983 to 2005, becoming a Partner in 1995.
Arno Rudolf – Non-Executive Director
Mr Rudolf is a Fellow of the Association of Chartered Certified Accountants. He has over 50 years of commercial experience across a variety of industries and currently owns and operates a successful debt recovery business focused on the bloodstock and horse racing industry.
Statement of Compliance with the QCA Corporate Governance Code
The Board seeks to follow best practice in corporate governance to the extent appropriate to the Company’s size, nature and stage of development and in accordance with the regulatory framework that applies to AIM companies. Starting 28 September 2018 all AIM companies are required to comply with a recognised corporate governance code. Boxhill Technologies plc has adopted the Quoted Companies Alliance (“QCA”) Corporate Governance Code which was published in April 2018 for this purpose.
The QCA Code identifies ten principles to be followed in order for companies to deliver growth in long term shareholder value. Details of how Boxhill Technologies plc addresses key governance principles as defined in the QCA code are set out below.
The Board and its Committees
The Company is led by a Board comprising Non-Executive and Executive Directors. The appointment of Directors is considered by the Nomination and Remuneration Committee and then the Board.
The Board convenes a minimum of eleven times a year, approximately monthly, and more frequently where business needs require. The Board does not have a schedule of matters specifically reserved to it for decision-making, but its responsibilities include matters such as:
- Contracts and trading
- Material capital commitments
- Financial issues
- Approving management and statutory accounts
- Risk identification and assessment
This enables the Directors to review corporate strategy and the operations and results of the business and to discharge their duties within a framework of prudent and effective controls relating to the assessment and management of risk.
The Board of Directors includes two Directors who are considered by the Directors to be independent for the purposes of the QCA corporate governance code, Clive Hyman and Arno Rudolf.
The Group has an Audit Committee, Remuneration Committee, Compliance Committee, Nominations and an Operations Committee as below. Each committee has terms of reference. All committees include a chairman and at least one additional director.
The Audit Committee
Chaired by Clive Hyman with Arno Rudolf as a member, receives and reviews reports from management and the Group’s auditors relating to the annual and interim accounts and the accounting and internal control systems in use throughout the Group. The Audit Committee has unrestricted access to the Group’s auditors.
The Remuneration Committee
Chaired by Arno Rudolf and Lord Razzall as a member, reviews the scale and structure of the Executive Directors’ remuneration and the terms of their contracts. The terms and conditions of appointment of the non-executive directors (including remuneration) are set by the Board. The Remuneration Committee also advises on staff remuneration and administers the Company’s share option schemes.
The Nominations Committee
Chaired by Lord Razzall and Arno Rudolf and Clive Hyman as members. Its role is to consider appointments to the Board.
The Compliance Committee
Chaired by Lord Razzall and Clive Hyman as member, has the primary responsibility for ensuring compliance with the AIM Rules for Companies concerning the disclosure of information. The Compliance Committee works closely with the Board to ensure that the Company’s Nominated Adviser is provided with any information it reasonably requests or requires in order that it may carry out its responsibilities under the AIM Rules.
The Operations Committee
Chaired by Philip Jackson, with the Finance Director and other senior management from across the business including, Sales, Finance, Operations and IT as members.
The Operations committee provides review, guidance and oversight for the operational areas of the business whilst providing strategic insight to operational processes and issues.
The committee meets on a monthly basis to review the progress, updates and other issues arising during the month, and to provide feedback and suggestions to senior management.
The Operations Committee in turn updates the Board on a monthly basis.
Key QCA Principles
The QCA has identified ten principles that focus on the pursuit of medium to long-term value for shareholders without stifling the entrepreneurial spirit in which the company was created.
In order to adopt the QCA Code it is necessary for a company to apply the ten principles and also to publish certain related disclosures. Detailed below for each principle is a clear explanation of how the company applies the QCA Code (the corporate governance statement). The corporate governance statement is included on the Company’s website and will be in its annual report.
Establish a strategy and business model which promote long-term value for shareholders
Boxhill Technologies plc is a diversified company delivering best in class products across Lottery and eCommerce. Each of our divisions enjoys long standing relationships with blue chip clients including household names and leading charities.
Boxhill will continue to deliver or acquire new products and businesses, with a particular focus on gaming and lotteries and payment processing, underpinned by a solid asset base. Boxhill will deliver innovative best of class solutions for our clients within a structured corporate governance environment and strategic vision whilst balancing the need for systems and procedures yet still allowing flexibility and entrepreneurship in order to grow the Boxhill group of companies.
It is the intention of the Board to publish a statement in accordance with Principle 1 for inclusion in the annual report and accounts for the year to 31 January 2018; a limited statement, not in accordance with Principle 1, was included in the annual report and accounts for the year to 31 January 2017.
Seek to understand and meet shareholder needs and expectations
The Company ensures it is contactable by investors through a dedicated email address together with the company’s address and phone number which can be found on the Company’s website. The primary contact point for investor relations is Lord Razzall.
In addition, the company has twitter account @boxhillplc that shares economic news as well as occasional company updates.
The company holds an AGM to which all members are invited. The AGM is the main forum for dialogue with shareholders and the Board. The Notice of Meeting is sent to shareholders at least 21 days before the meeting. The chairs of the Board and all committees, together with all other Directors, routinely attend the AGM and time is set aside specifically to allow questions from attending members to any board member. The Board encourages constructive feedback from its shareholders on their needs and expectations for the Company through the question and answer sessions at its annual general meeting.
For each vote, the number of proxy votes received for, against and withheld is announced at the meeting.
The company believes this has been a successful strategy to date demonstrated by the proportion of shareholders that vote at each AGM. The results of the AGM are subsequently published on the Company’s corporate website.
We seek at all times to provide open and realistic communications with shareholders while ensuring compliance with our regulatory obligations.
Take into account wider stakeholder and social responsibilities and their implications for long-term success
The Company believes that, in addition to its shareholders, suppliers, clients and regulatory partners, its employees are the main stakeholders. We continually work to improve our employment practices and create a rewarding environment for all employees. Additionally, we invest in training and development for employees and management and believe in diversity in the workplace.
The Company has an open and compliant approach to its dealings with the regulators concerned with the admission of the Company’s shares to trading on the AIM Market. The Board seeks to identify suppliers that provide the right balance of capabilities and cost and are identified purely on an arms-length commercial basis. The Company’s suppliers will be paid in line with agreed payment terms and the Board will act in an ethical manner in all dealings and expect the same from its suppliers.
The Board recognises that as it develops, there will be wider stakeholder and social responsibilities which will have to be taken into account, in particular in relation to the communities in which it becomes active. The Board will seek constructive feedback from all its stakeholders and Clive Hyman has been designated as the Non-Executive director to whom any stakeholder may provide open and confidential feedback.
Embed effective risk management, considering both opportunities and threats, throughout the organisation
The Board identifies and addresses all risks based on a considered assessment of the likelihood of a risk occurring and the magnitude of the risk to the Company were it to occur, from both an upside and downside perspective. The nature of the Group and its business model creates reliance upon retaining and incentivising its senior management and certain key employees, whose expertise will be important to the fortunes of the Group going forward. The Directors have endeavoured to ensure that the principal members of its management team are suitably incentivised, but the retention of such staff cannot be guaranteed.
Demand for the Group’s services may be significantly affected by the general level of economic activity and economic conditions in the regions and sectors in which the Group operates. Therefore, a continuation of the challenging economic environment, especially in regions or sectors where the Group’s operations are focused, could have a material adverse effect on the Group’s business and financial results.
The Group’s financial risk management strategy is based on sound economic objectives and corporate practices. The main financial risks concern the availability of funds to meet obligations as they arise (liquidity risk) and fluctuations in exchange rates (exchange rate risk).
The Group is engaged in business activities where there are a number of competitors. Many of these competitors are larger than the relevant businesses carried on by the Group and have access to greater funds than the Group, which will potentially enable them to gain market share at the expense of the Group.
The Directors cannot discount circumstances where an acquisition would support the Group’s business strategy. However, there is no guarantee that the Group will successfully be able to identify, attract and complete suitable acquisitions or that the acquired business will perform in line with expectations.
Funding and working capital
Maintaining a sufficient level of working capital is essential to enable the Group to meet its foreseeable obligations and achieve its strategy. Failure to manage working capital could impact upon the ability of the Group to grow
Management of Growth
The ability of the Group to implement its strategy in an expanding market requires effective planning and management control systems. The Group’s growth plans may place a significant strain on its management, operational, financial and personnel resources. The Group’s future growth and prospects will, therefore, depend on its ability to manage the growth and to continue to expand and improve operational, financial and management information and quality control systems on a timely basis, whilst at the same time maintaining effective cost controls. Any failure to expand and improve operational, financial and management information and quality control systems in line with the Group’s growth could have a material adverse effect on its business, financial condition and results of operations.
Any failure to expand the Group’s service offering in response to customer demand and/or industry developments may have an adverse effect on the Group’s financial performance and prospects.
Reliance on Partners
Much of the Group’s business is dependent on partners (acquiring banks, charities, clubs, etc.). Changes in key relationships with those partners, change of strategic direction by partner organisations, changes in the viability of partner-owned technology, economic and other business circumstances could all have an adverse effect on the financial performance of the Group.
Legal and regulatory matters
The Group is subject to a considerable degree of regulation and legislation. Changes in or extensions of laws and regulations affecting the industry in which the Group operates (or those in which its customers operate) and the rules of industry organisations could restrict or complicate the Group’s business activities, with the potential to increase compliance/legal costs significantly.
Audit, risk and internal control
The Company has an established framework of internal financial controls, the effectiveness of which is regularly reviewed by the Executive Management, the Audit Committee and the Board in light of an ongoing assessment of significant risks facing the Company.
- The Board is responsible for reviewing and approving overall Company strategy, approving revenue and capital budgets and plans, and for determining the financial structure of the Company. Monthly results and variances from plans and forecasts are reported to the Board.
- The Audit Committee assists the Board in discharging its duties regarding the financial statements, accounting policies and the maintenance of proper internal business, and operational and financial controls, including the review of results of work performed by the Group controls function.
- The Operations Committee assists the Board in terms of reviewing operational activity, processes and financials.
- There are comprehensive procedures for budgeting and planning, for monitoring and reporting to the Board business performance against those budgets and plans, and for forecasting expected performance over the remainder of the financial period. These cover profits, capital expenditure and balance sheets. Monthly results are reported against budget and compared with the prior year, and forecasts for the current financial year are regularly revised in light of actual performance.
The Board has ultimate responsibility for the Group’s system of internal control and for reviewing its effectiveness. However, any such system of internal control can provide only reasonable, but not absolute, assurance against material misstatement or loss. The Board considers that the internal controls in place are appropriate for the size, complexity and risk profile of the Group. The principal elements of the Group’s internal control system include:
- Close management of the day-to-day activities of the Group by the Executive Directors
- An organisational structure with defined levels of responsibility, which promotes decision-making and rapid implementation while minimising risks
- A comprehensive annual budgeting process producing a detailed integrated profit and loss, balance sheet and cash flow, which is approved by the Board
- Detailed monthly reporting of performance against budget
- Central control over key areas such as capital expenditure authorisation and banking facilities
The Group continues to review its system of internal control to ensure compliance with best practice, while also having regard to its size and the resources available.
It is the intention of the Board to provide an updated risk management approach, in accordance with Principle 4, for inclusion in the annual report and accounts for the year to 31 January 2018; a limited statement, not in accordance with Principle 4, was included in the annual report and accounts for the year to 31 January 2017.
Maintain the board as a well-functioning, balanced team led by the chair
The board of Boxhill Technologies plc currently comprises two Executive Directors, one being the Chairman, and two independent non-executive Directors. The appointed Company Secretary is one of the Executive Directors who possesses the relevant experience to perform this function. The Company actively continues in its search for the best candidate to perform the chief executive officer role for the Group.
The Board is considered to be of an appropriate size to comply with relevant Corporate Governance requirements and enable efficient decision making.
The Board considers, after careful review, that the Non-Executive Directors bring an independent judgement to bear. The Board is satisfied that it has a suitable balance between independence on the one hand, and knowledge of the Company on the other, to enable it to discharge its duties and responsibilities effectively.
All Directors are encouraged to use their independent judgement and to challenge all matters, whether strategic or operational. During the year eleven Board meetings took place. These were held at the Boxhill Technologies Plc head office in London.
The Board is aware of the other commitments and interests of its Directors, and changes to these commitments and interests are reported to and, where appropriate, agreed with the rest of the Board.
The Chairman assisted by the Senior Independent Director (Clive Hyman) take a position of leadership on all matters of Corporate Governance. They are supported in this by the Company Secretary, who ensures that the Board (and any Board Committees) are provided with high quality information on a timely manner in order to facilitate a proper assessment of the matters requiring a decision or insight.
The following directors are regarded as independent:
- Clive Hyman
- Arno Rudolf
It is the intention of the Board to provide an update on Principle 5 for inclusion in the annual report and accounts for the year to 31 January 2018; a limited statement, not in accordance with Principle 5, was included in the annual report and accounts for the year to 31 January 2017.
Ensure that between them the directors have the necessary up-to-date experience, skills and capabilities
The Directors of the Company have been chosen because of the skills and experience they offer. Full biographical details are included on the Company’s website.
The Board considers that all of the Non-executive Directors are of sufficient competence and calibre to add strength and objectivity to its activities. The Board is satisfied that, between the Directors, it has an effective and appropriate balance of skills and experience. The Board regularly reviews the composition of the Board to ensure that it has the necessary breadth and depth of skills to support the ongoing development of the Group.
All Directors receive regular and timely information on the Group’s operational and financial performance. Relevant information is circulated to the Directors in advance of meetings. The business reports monthly on its headline performance against its agreed budget, and the Board reviews the monthly update on performance and any significant variances are reviewed at each meeting.
All Directors are able to take independent professional advice in the furtherance of their duties, if necessary, at the Company’s expense. In addition, the Directors have direct access to the advice and services of the Company Secretary and Chief Financial Officer.
The Chairman, in conjunction with the Company Secretary, ensures that the Directors’ knowledge is kept up to date on key issues and developments pertaining to the Group, its operational environment and to the Directors’ responsibilities as members of the Board. During the course of the year, Directors received updates from the Company Secretary and various external advisers on a number of corporate governance matters.
Details of each director’s relevant experience, skills and personal qualities can be found here https://boxhillplc.com/about-us/. Each board member keeps their skills up to date through a combination of courses, continuing professional development through professional bodies and reading.
It is intended that the Company will include a statement in accordance with Principle 6 in the annual report and accounts for the year to 31 January 2018; no statement in accordance with Principle 6 was included in the annual report and accounts for the year to 31 January 2017.
Evaluate board performance based on clear and relevant objectives, seeking continuous improvement
The Company undertakes regular monitoring of personal and corporate performance using agreed key performance indicators and detailed financial reports and works with is corporate advisors to ensure standards are of an appropriate level for a publicly quoted company.
In addition, the Board annually reviews its own performance as a whole and of each individual Director. The performance of each Committee is also assessed and guidance and or improvements are made where and when considered appropriate and necessary. These evaluations were not undertaken in previous years. It is intended that these evaluations shall be undertaken annually, after the end of each financial year but prior to the publication of the respective annual report and accounts.
The Board also considered and ensures that each Director has the appropriate skills, knowledge, experience and qualifications to be able to perform his or her duties to the highest standard required.
The Company’s approach to succession planning is to bring talented individuals into the group at an operating level with the objective of their graduating to Board level in due course.
It is intended that the Company will include a statement in accordance with Principle 7 in the annual report and accounts for the year to 31 January 2018; no statement in accordance with Principle 7 was included in the annual report and accounts for the year to 31 January 2017.
Promote a corporate culture that is based on ethical values and behaviours
A strong corporate culture that is based on ethical values and behaviours is a key part to a successful company.
The Group is committed to providing a safe environment for its staff and all other parties for which the Group has a legal or moral responsibility in this area.
An open culture is encouraged within the Group, with regular communications to staff and staff feedback regularly sought. The Executive Committee monitors the Group’s cultural environment and seeks to address any concerns than may arise, escalating these to Board level as necessary.
The company carries out regular reviews of the performance of each employee and officer of the company.
It is intended that the Company will include a statement in accordance with Principle 8 in the annual report and accounts for the year to 31 January 2018; no statement in accordance with Principle 8 was included in the annual report and accounts for the year to 31 January 2017.
Maintain governance structures and processes that are fit for purpose and support good decision-making by the board
The board of Boxhill Technologies plc currently comprises an Executive Chairman, one Executive Director (the Finance Director) and two independent non-executive Directors. The appointed Company Secretary is the Executive Finance Director, a qualified Chartered Accountant with the relevant experience to perform this function. The board will actively consider adding additional members to the Board as and when the size of the Company requires.
The Board has overall responsibility for the management and success of the Group. The Executive Directors have day-to-day responsibility for the operational management of the Group’s activities. The Non-executive Directors are responsible for bringing independent and objective judgment to Board decisions.
The Chairman is responsible for overseeing the running of the Board, ensuring that no individual or group dominates the Board’s decision-making and ensuring the Non-executive Directors are properly briefed on matters. The Chairman has overall responsibility for corporate governance matters in the Group and chairs the Nominations and Corporate Governance Committee. The Company Secretary is responsible for ensuring that Board procedures are followed and applicable rules and regulations are complied with.
The Board has also established an Audit Committee, Remuneration Committee, Compliance Committee, Nominations Committee and an Operations Committee as above. Each committee has terms of reference. Memberships of the different committees is set out at the start of this statement. The terms of reference for the different committees can be viewed here https://boxhillplc.com/regulatory-news/aim-26-rule/.
Lord Razzell’s participation in the remuneration and nomination committee is not regarded as best practice under the QCA Corporate Governance Code as he is an executive director. The Board however consider it appropriate due to the temporary nature of his executive appointment (while the Company seeks an appropriate chief executive) and the skills and experience which he brings.
Communicate how the company is governed and is performing by maintaining a dialogue with shareholders and other relevant stakeholders.
The Board ensures that all stakeholders are kept up to date with the developments of the Company through the Annual Report and Accounts, half-year announcements, the Annual General Meeting (AGM) and trading updates throughout the year. The Board encourages two-way communications with all shareholders and stakeholders whether that be by:
- telephone, email or letter
- investor meetings
- financial updates including interim and annual audited accounts
- General Meetings of the Company including the Annual General Meeting
And via the Company’s website www.boxhillplc.com
The votes at all general meetings of the Company from 2018 will be published on the Company’s website.
If any significant proportion of votes (>20% of independent votes) cast are against a resolution, the Board will provide an explanation on the same page of the action it intends to take.
Notices of all general meetings and annual report and accounts published by the Company for the last five years can be viewed on the Company’s website.
It is intended that the Company will include a statement in accordance with Principle 10 in the annual report and accounts for the year to 31 January 2018; no statement in accordance with Principle 10 was included in the annual report and accounts for the year to 31 January 2017.
The Company is subject to the City Code on Takeovers and Mergers, as published by the Panel on Takeovers and Mergers and updated from time to time.
Country of incorporation, main country of operation
Boxhill Technologies Plc is incorporated in England, and its main country of operation is the United Kingdom.
View the Articles of Association here.
Most recent annual report
View the latest Annual Report here.
View the latest documents here.
Notifications from the last 12 months
View the latest documents here.
View the document here.
Number of securities in issue
Number of securities in issue: 2,815,829,770.
Number of securities held in treasury
There are currently no shares held in treasury.
Shareholdings in the Company of greater than 3% are as follows:
|Shareholder||Number of Ordinary Shares Held||Percentage of Share Capital Held|
|Empire Global Management Limited||500,000,000||17.76%|
1 Includes shares held by Bluedale Corporate Limited, a company Mr Botros controls, and 46,236,391 held by J M Malone, Mr Botros’ wife.
2 Includes shares held by Management Express Limited, a company that Mr Rose controls, and 50,000,000 held by Mr Rose.
3 A company controlled by Philip Jackson.
|Director||Number of Ordinary Shares Held||Percentage of Share Capital Held|
1 Includes shares held by Bluedale Corporate Limited, a company Mr Botros controls, and 46,236,391 held by J M Malone, Mr Botros’ wife. Mr Botros is a director of a subsidiary of the Company.
2 Includes shares held by Management Express Limited, a company that Mr Rose controls, and 50,000,000 held by Mr Rose. Mr Rose is a director of a subsidiary of the Company.
3 Includes shares held by Moorhen Limited, a company Mr Jackson controls. Mr Jackson is a director of a subsidiary of the Company.
4 Director of Boxhill Technologies PLC
Total Not In Public Hands
The total percentage of shares not in public hands is 31.69% defined as being beneficial holdings of shares held by shareholders holding above 10% and the directors holdings.
Details of any restrictions on transfer
There are no restrictions on transfer of securities.
Details of Company Advisers
Nominated Advisers and other Advisers
Nominated Adviser and Broker
Allenby Capital Limited
5 St Helen’s Place
t: +44 (0) 20 3328 5656
f: +44 (0) 20 3394 2970
KPMG LLP (UK)
15 Canada Square
This information is disclosed for the purposes of AIM Rule 26.Last updated: September 28, 2018 at 9:58 am