213800WG8RSE45I3MF222021-04-012022-03-31iso4217:GBP213800WG8RSE45I3MF222020-04-012021-03-31iso4217:GBPxbrli:shares213800WG8RSE45I3MF222022-03-31213800WG8RSE45I3MF222021-03-31213800WG8RSE45I3MF222020-03-31ifrs-full:IssuedCapitalMember213800WG8RSE45I3MF222020-03-31ifrs-full:CapitalRedemptionReserveMember213800WG8RSE45I3MF222020-03-31motorpointgroupplc:CapitalReorganisationReserveMember213800WG8RSE45I3MF222020-03-31motorpointgroupplc:EBTReserveMember213800WG8RSE45I3MF222020-03-31ifrs-full:RetainedEarningsMember213800WG8RSE45I3MF222020-03-31213800WG8RSE45I3MF222020-04-012021-03-31ifrs-full:IssuedCapitalMember213800WG8RSE45I3MF222020-04-012021-03-31ifrs-full:CapitalRedemptionReserveMember213800WG8RSE45I3MF222020-04-012021-03-31motorpointgroupplc:CapitalReorganisationReserveMember213800WG8RSE45I3MF222020-04-012021-03-31motorpointgroupplc:EBTReserveMember213800WG8RSE45I3MF222020-04-012021-03-31ifrs-full:RetainedEarningsMember213800WG8RSE45I3MF222021-03-31ifrs-full:IssuedCapitalMember213800WG8RSE45I3MF222021-03-31ifrs-full:CapitalRedemptionReserveMember213800WG8RSE45I3MF222021-03-31motorpointgroupplc:CapitalReorganisationReserveMember213800WG8RSE45I3MF222021-03-31motorpointgroupplc:EBTReserveMember213800WG8RSE45I3MF222021-03-31ifrs-full:RetainedEarningsMember213800WG8RSE45I3MF222021-04-012022-03-31ifrs-full:IssuedCapitalMember213800WG8RSE45I3MF222021-04-012022-03-31ifrs-full:CapitalRedemptionReserveMember213800WG8RSE45I3MF222021-04-012022-03-31motorpointgroupplc:CapitalReorganisationReserveMember213800WG8RSE45I3MF222021-04-012022-03-31motorpointgroupplc:EBTReserveMember213800WG8RSE45I3MF222021-04-012022-03-31ifrs-full:RetainedEarningsMember213800WG8RSE45I3MF222022-03-31ifrs-full:IssuedCapitalMember213800WG8RSE45I3MF222022-03-31ifrs-full:CapitalRedemptionReserveMember213800WG8RSE45I3MF222022-03-31motorpointgroupplc:CapitalReorganisationReserveMember213800WG8RSE45I3MF222022-03-31motorpointgroupplc:EBTReserveMember213800WG8RSE45I3MF222022-03-31ifrs-full:RetainedEarningsMember
Motorpoint Group Plc Annual Report and Accounts 2022
Transformation
delivering
signiicant growth
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Governance Financial Statements
1
Motorpoint Group Plc
Annual Report and Accounts 2022
2022 highlights
Note: FY21 performance and liquidity were impacted by forced branch closures and the challenging economic uncertainty caused by the COVID-19 pandemic.
1. based on data produced by the Society of Motor Manufacturers and Traders (‘SMMT’)
2. as per the results from The UK’s Best 100 Companies To Work For
£1,322m
record turnover
£1,446
gross proit per retail unit
£625m
online revenues
3.1%
market share
(0–4 year old car market)
1
97.7k
vehicles sold
#1
best company to
work for in the
automotive sector
2
60%
units sold online
84
net promoter score
(‘NPS’)
Revenue
£1,322.3m
Proit Before Taxation (‘PBT’)
£21.5m
Gross Margin
8.0%
Basic Earnings Per Share (‘EPS’)
18.7p
Return on Capital Employed (‘ROCE’)
74.6%
Sell your car
buying cars direct from consumers, successfully
launchedinJuly 2021
#49 Best Large Company to Work For in the UK
our eighth consecutive year in “The UK’s 100 Best Companies
To Work For”
Average time to prepare a car
improved to 8.2 days for 0-3 year old cars (9.7 days in FY21);
improved to 11.4 days for 3+ year old cars (12.4 days in FY21)
Stock turn
improved to 54 days in stock (67 days in FY21)
Finance penetration
improved to 52% (42% in FY21), and APR rate lowered again
to8.9% (from 9.9% in FY21)
More branches
Manchester, Maidstone and Portsmouth branches
opened (making 17 in total)
2022 £1,322.3m
2021 £721.4m
2022 £21.5m
2021 £9.7m
2022 8.0%
2021 8.7%
2022 18.7p
2021 8.4p
2022 74.6%
2021 52.7%
About us
Car buying
made easy
Motorpoint is the UK’s leading omnichannel retailer of
0-4y4 year nearly new vehicles driven under 30,000 miles.
Making car buying easy has been
our Purpose for over 20 years. It’s
the reason why we have such a rich
history of adapting to the needs
of our customers and continually
innovating to deliver the best car
buying experience possible.
Decades of putting our customers
at the centre of everything we
do has given us an unparalleled
understanding of what people
want when they buy a car.
This is why we believe so strongly
in giving our customers unrivalled
Choice, Value, Service, and Quality,
and why we continue to be trusted
tobe the Car Buyer’s Champion.
For the latest investor relations, visit our website | www.motorpointplc.com/investor-relations/why-invest/
Contents
Strategic Report
1 2022 highlights
2 At a glance
3 Investment case
4 Our business and our market
6 The Car Buyer’s Champion
8 Our customers’ journey
10 Market overview
12 How we create value
14 Chair’s statement
17 COVID-19 update
18 Chief Executive’s statement
23 Key performance indicators
24 Our strategy
32 Section 172 statement
35 Environmental, Social and Governance
54 Financial review
58 Risk management
61 Principal risks and uncertainties
66 Non-inancial information statement
Governance
68 Board of Directors
70 Introduction to governance
71 Corporate governance report
75 Audit Committee report
79 Nomination Committee report
82 Remuneration Committee report
84 Remuneration policy
91 Annual report on remuneration
99 Director’s report
104 Statement of Directors’ responsibilities
Financial Statements
106 Independent auditors’ report
112 Consolidated statement of
comprehensive income
113 Consolidated balance sheet
114 Consolidated statement
of changes in equity
115 Consolidated cash low statement
116 Notes to the consolidated
inancial statements
141 Company balance sheet
142 Company statement
of changes in equity
143 Notes to the company
inancial statements
147 Alternative performance measures
148 Glossary
149 Shareholder information and advisers
Strategic Report Governance Financial Statements
32
Motorpoint Group Plc
Annual Report and Accounts 2022
At a glance
The UK’s leading independent
omnichannel vehicle retailer
People powered
At our heart we are a people
powered business and it is
our talented people who help
customers when purchasing a
vehicle from Motorpoint, giving
them the advice they’re looking
for, ensuring everything is to
the standard they expect and
developing new innovations,
products and services that
constantly improve the
purchasing process.
Read more / pages 47–52
Our purpose
Our Purpose
is tomake car
buying easy.
We’re here to help
our customers
buy the car they
want, in the way
they want.
Our vision
Our Vision
is to be the
Car Buyer’s
Champion,
trusted to deliver
unrivalled
Choice, Value,
Service and
Quality.
Omnichannel and
customer centric
By focusing on making car
buying easy for our customers
we have been able to create
the very best omnichannel
experience – one that
combines the convenience
and beneits of buying online,
Home Delivery and Reserve
and Collect with an extensive
nationwide retail network
ensuring high levels of quality,
service and support.
Read more / page 4
Our medium term strategy
is to grow revenue to more
than £2bn
Underpinned by a commitment to:
Rapidly upscaling
our E-commerce
capability
Substantial increase in
technology, data and
marketing investment.
Relentless focus
on E-commerce
1
20+ years of customer
insight and innovation
Expansion of
Auction4Cars.com
4
Multiple revenue
streams – Motorpoint,
Auction4Cars.com,
ancillary services
and inance
Increasing shift to
online provides operating
model opportunities
2
Only nearly new cars –
under four years /
30,000 miles
Signiicant investments in
technology and marketing
5
Nationwide
branch network
Website improvements
boosting traic
3
Always low
prices delivering
great value
Expand digitally led
car buying service
6
Buy cars direct
from customers
Expand wholesale
and E-commerce
channels
Expanding our
E-commerce
Auction4Cars.com
platform to grow and
accommodate new
supply channels.
Increase customer
acquisition and
retention
Increasing investment in
our customer proposition,
marketing capability
and leveraging our data.
Led by online sales
and fulilment capacity
increase in new markets.
Operational
eiciency through
technology and
innovation
Further automation and
technology investment
as sales migrate to
E-commerce channels.
OUR
STAKEHOLDERS
OUR PEOPLE
AND CULTURE
OUR
COMMUNITIES
AND THE
ENVIRONMENT
GOVERNANCE RISK
MANAGEMENT
Read more / pages 32–34 Read more / pages 47–52 Read more / pages 35–52 Read more / pages 67–104 Read more / page 58–65
What makes us dierent
Digital transformation
providing opportunities
for growth
Investment case
Our omnichannel approach gives customers the choice of buying cars through
our branch network or online.
Strategic Report Governance Financial Statements
54
Motorpoint Group Plc
Annual Report and Accounts 2022
A group focused on growth... ...through two distinct brands
Our business and our market
Platform successfully upgraded to operate as an automated
marketplace to third party vendors.
Auction4Cars.com, a business to business entirely online auction marketplace platform, allows an eicient
and quick route for sale of part exchange vehicles which do not fall into our nearly new retail criteria.
The business beneits from over 9,000 registered trade users.
WHOLESALE
VEHICLES
Online only
NON-PART EXCHANGE
>4 years
>30,000 miles
PART EXCHANGE
>4 years
>30,000 miles
Lowest online
buyers’ fees from
£30
Low
cost base
Wholesale vehicles
online only
>9,000
Customers and
growing
Motorpoint is the UK’s leading omnichannel vehicle retailer.
Our retail oer of nearly new cars that are under four years old or have completed less that 30,000 miles
provides customers with an omnichannel purchasing journey combining online with 17 retail branches nationwide.
We also oer a large range of commercial vehicles under the Motorpoint brand.
NON-PART EXCHANGE
Sell your car service launched
in July 2021
<4 years
<30,000 miles
PART EXCHANGE
<4 years
<30,000 miles
NEARLY NEW
CONSUMER VEHICLES
Online + In Branch
LIGHT COMMERCIAL
VEHICLES
Online + In Branch
#1
Value retailer
84
NPS
Consumer
omnichannel
20+
years as a leading player
in the nearly new
market
Our People
Our people are at the heart of our business, not least
in ensuring the quality of the customer experience;
this is why we are determined to continually focus
on our team engagement.
Strategic Report Governance Financial Statements
76
Motorpoint Group Plc
Annual Report and Accounts 2022
Choice
Choice for our customers means not only the
model and price range of available vehicles
we stock, but also the options through which
theycan view, purchase, and take delivery of
their vehicle.
Value
Being the biggest allows us to secure the
best stock at competitive prices when we
source stock and we pass those savings on to
our customers. Eicient new branch capital
investment and no requirement to pay for
goodwill helps manage the overhead base.
Service
100% stock mobility across the UK between
any of our branches means we are able
to provide convenience led initiatives,
such asSame Day Driveaway, free Home
Delivery,Contactless Collections and a
range of inancing and ancillary products.
Part exchanges are competitively priced
andprovided and disposed through
Auction4Cars.com.
Quality
Motorpoint Quality Standard sits at the
core of our operations, ensuring we deliver
the highest levels of quality of product and
service along the entire customer journey.
In October we launched the QC app to drive
improvements in cosmetic and mechanical
issues which reduced from 7% to 3%.
The Car Buyer’s Champion
Our talented and engaged
team are focused on making
Car Buying Made Easy for our
customers and ensuring we
achieve our vision
Read more / pages 47–52
6,590
vehicles home delivered
84
Net Promoter
Score
600+
makes and models
in stock
97%
of vehicles listed as below
market price average
on Autotrader
Motorpoint has consistently had more underpriced stock
than the marketplace since June 2021.”
Autotrader Report May 2022
Strategic Report Governance Financial Statements
98
Motorpoint Group Plc
Annual Report and Accounts 2022
We make car buying easy by
being online and in branch
Our customers’ journey
Easy to
buy/sell
your car
Easy to
contact
Easy to
collect
Enthusiastic
team to help
customer through
the sales process
Digital end
to end journey
Finance completed in
privacy of own home
and with access to
all information
Same day driveaway
Home delivery
Reserve and collect
Buy Online, collect
in branch
Handover done in less
than 30 mins
Quality, service
and fulilment
support both online
and at branch
Easy to
view
Easy to
ind
In branch
Branch locations
Customer agents
within branches
Comprehensive
online search
engine; improved
listings and search
Diverse and vast
range of stock
tobrowse and
testdrive
360° virtual tour
of the vehicle and
gallery of images
with technical
speciications
Online
Beneits
Extensive
Choice
Great Value –
Motorpoint
Price Pledge
Flexible
Finance
Options
Payment
made within
minutes
of deal being
agreed
Launched
our car buying
service in
FY22
Competitive
Part exchange
Prices
Award Winning
Service
High quality
and standards
guaranteed
14-day
money back
guarantee
We have invested in creating a deeply embedded digital and retail omnichannel
customer journey that gives the car buyer the choice of how to buy their next
car in a way that its their lifestyle.”
Strategic Report Governance Financial Statements
1110
Motorpoint Group Plc
Annual Report and Accounts 2022
Market overview
We experienced signiicant
demand following the
lockdown last Spring
Supply was then curtailed following the well publicised
chip shortage impacting new cars and commercial
vans. Unprecedented inlation in used car prices in
the year. Our branches remained open from April,
despite theCOVID-19 pandemic.
6,590
cars delivered directly
to customer homes
Car market
Motorpoint’s core proposition
remains the sale of nearly new cars
and commercial vans which are up
to four years old and have covered
fewer than 30,000 miles. We monitor
available market statistics, notably
from the SMMT, which give us
transaction volumes for target market
cars but do not include recorded
mileage. We therefore use the
transaction volumes alone as a proxy
for our available market. The used
car market was inluenced by the
knock on eect of the chip shortages
limiting new car production, and
resultant unprecedented inlation. The
market increased in FY22, given the
national lockdowns the previous year,
despite the impact of chip shortages.
Consumer conidence
Branch closures during the lockdowns
in FY21 negatively impacted car
buying activity, although we did
experience signiicant uplift in online
revenue and home delivered vehicles.
Following the easing of restrictions
in April 2021, we experienced record
sales, as conidence improved.
Whilst the shift to digital channels
will continue, the majority of our
customers still wanted to visit
branches to complete their car
buying experience. Despite the
slowdown in supply, demand
remained strong as we continued to
increase our market share. Looking
forward, the impact of rising cost
inlation and worldwide vehicle
supply challenges is likely to aect
our markets, but it is diicult to assess
the impact in the short term, which is
further exacerbated by the situation
in Ukraine. However, rising inlation
is likely to place further pressure on
discretionary spending power and
consumer sentiment. In this uncertain
environment, Motorpoint will continue
to invest in revenue and market share
growth, in strategic future capabilities
and in providing an exceptional
omnichannel customer experience.
97.7k
vehicles sold,
inc 34.8k via
Auction4Cars.com
platform
Market share (0-4 year old vehicles)
3.1%
Revenues
£1,322.3m
2022 3.1%
2021 2.4%
2022
2021
£1,322.3m
£721.4m
Motorpoint exceeded our expectations with the delivery of our incredibly low
mileage Honda Jazz. The sale was conducted in a professional manner. Delivery to
our home was in the promised time window. The delivery driver kept in touch with
us by phone in the run up to arrival and ensured a smooth, pleasant handover with
clear explanation of all essentials. Thanks for your excellent service.”
Customer testimonial
Strategic Report Governance Financial Statements
1312
Motorpoint Group Plc
Annual Report and Accounts 2022
Agility, culture, eiciency
How we create value
HAPPY
We enjoy what we do and we show it – a smile is
contagious and our teams wear them naturally with pride.
A happy team makes for a better working environment
which in turn translates to a great customer experience.
HONEST
This applies to our teams, investors and customers.
Courage and honesty are the vehicles for positive
change and Team Motorpoint has embraced this.
FREE HOME DELIVERY
Our customers can choose a vehicle,
arrange inance, purchase and have it
delivered to them, without having to
leave their home. We successfully fully
launched in May 2020, and it continues
to be popular with customers, despite
the lockdown restrictions being lifted.
PART EXCHANGES
Motorpoint sells vehicles with less than
30,000 miles, and less than four years
old, to retail customers. Any vehicle in
excess of this mileage purchased from
a customer as part exchange is sold
through our wholesale E-commerce
platform Auction4Cars.com.
This platform provides invaluable live
data on the latest valuation of vehicles
sold through Auction4Cars.com and
allows us to oer the best price to our
customers for their part exchange.
F
R
E
E
H
O
M
E
D
E
L
I
V
E
R
Y
P
A
R
T
E
X
C
H
A
N
G
E
S
Our strength lies in our ability to be agile and responsive, in our people and our culture,
and in our constant focus on improving operational eiciencies across our digital
platforms and retail network.
Key strengths and resources
Underpinned by our values
Our operating model is focused on putting our employees irst. This means empowering our team and giving them the
skills andconidence to champion the customer. We achieve this through living our core values and team commitments.
PROUD
We are proud of what we do, how we do it and
the people who make it happen – we stand out
from the crowd and are proud to work as part
of Team Motorpoint.
SUPPORTIVE
We have a one team ethos and understand that together
we achieve more. We are a united team focused on
a common goal and vision and will always help our
customers and colleagues alike #drivingdreams®.
How we create value
RETAIL BRANCHES
Our retail branches oer sales, light vehicle
preparation and a large display area. All
branches oer café and lounge facilities to
enhance our customers’ experience and
comfort. Locations are generally positioned
for ease of access and located within close
proximity of a large population. Our paperless
and contactless purchase process allows
customers the option to complete their vehicle
purchase in branch or online, visit our branch
to collect their vehicle, and drive away in under
30minutes.
RETAIL WEBSITES
We constantly innovate to deliver
outstanding customer service and we have
a free nationwide Home Delivery service
with a 14-day money back guarantee to all
retail customers. Our website allows us
to maintain a convenient and trusted user
experience as customer preferences evolve.
Our upgraded imaging and vehicle
speciication details provide customers
with substantial information on the vehicle
they are researching or buying, enhancing
the conversion to sale on our website.
MyMotorpoint, our customer portal, was
launched last year and allows customers to
complete all documentation requirements
online, enabling Home Delivery and faster
handovers in branch. This is proving popular
with our customers.
R
E
T
A
I
L
B
R
A
N
C
H
E
S
R
E
T
A
I
L
W
E
B
S
I
T
E
S
New branches and growth opportunity
We can open wherever we see a market opportunity; speed and scale
are in our control. We can choose to buy an existing dealer, or develop
an entirely newoperation, avoiding the need for goodwill payments.
Breadth of stock
On average 38 brands are available on site or online, spanning all of the
leading makes and models, sourced from multiple channels. All stock is
available nationally.
Retail product oer
Our retail proposition continues to be 100% on nearly new cars and
commercial vans; our product oering is supported by providing inance
packages to our customers through our inance partners as well as
oering warranty, insurance and paint protection products.
Operational control
We have no external restrictions. Proprietary IT systems can be built;
we have bespoke values led development and sta engagement
programmes; marketing can be via any channel or into any geography; our
modest showroom it out costs support Motorpoint’s valueproposition.
Financing
We are free to negotiate for the most competitive terms on the
external market.
Car buying
In July 2021 we launched our service to purchase cars direct from
consumers. Depending on their age, cars can either be sold through
Motorpoint (thus providing a further supply chain route), or via the
Auction4Cars.com platform.
Strategic Report Governance Financial Statements
1514
Motorpoint Group Plc
Annual Report and Accounts 2022
Chair’s statement
The Group outlined a number of
medium term strategic objectives in
its FY21 Final Results which included,
among other things, to achieve £1bn
in online revenue, generate more
than £2bn in total revenue and open
12 new branches oering sales,
customer service and collection.
I have been pleased to see the
progress made on these objectives
just one year on, with the Group
growing overall revenue by 83% to
£1.32bn, and E-commerce revenue
by 43% to £625m whilst also opening
three new branches in strategically
signiicantregions.
Motorpoint’s medium term
objectives remain a focus, as it
embraces the amount and pace of
transformational change required
forit to seize its growth opportunity
in the medium term and beyond. For
example it willcontinue developing
new strategic capabilities across
the business, and in particular in
technology and marketing. The
Group has invested signiicantly in
these areas during FY22, recruiting a
number of new leaders including a
Chief Digital Oicer and a technology
Board advisor.
Motorpoint is on an exciting,
transformational journey
It is clear that Motorpoint is
embarking on an exciting,
transformational journey, and I am
proud to be a part of the next phase
of growth. I would like to take this
opportunity to thank the former
Chair, Mark Morris, for his work with
the Board and Motorpoint from 2011
to 2022, successfully leading the
Group through its IPO in 2016 and
helping to establish it as the UK’s
leading independent omnichannel
vehicleretailer.
Introduction
During my irst few months as Chair,
I have spent time with fellow Board
members and the Senior Leadership
Team, immersing myself in the Head
Oice and across the branch network,
as well as the UK used car industry
more generally. I have been incredibly
impressed by what I have seen so far.
There is no doubt that Motorpoint
is a responsible, well operated and
proitable business, with unparalleled
expertise in the UK’s used car market.
These are important assets in the
current environment and provide solid
foundations to support our emerging
plans for long term growth.
Ambition, opportunity
and execution
It was Motorpoint’s ambition and the
scale of the market opportunity that
initially attracted me to the business.
The Group has seen signiicant
changes to car buying expectations
as consumers increasingly embrace
digital content but expect to be able
to pick and choose services from
among both digital and physical
options. The used car retail market
has also changed signiicantly with
the arrival of aggressive, well funded
‘pure play’ E-commerce competitors
coupled with many legacy dealers
that may resist necessary change. We
are excited by the opportunity to lead
as the market’s largest omnichannel
used car retailer and believe we are
well positioned for success.
I am delighted to have been given the opportunity to join the Board of Motorpoint
as Chair, a role which commenced on 10 January 2022.
£1,322m
Total revenues
(up 83% from FY21)
£625m
Online revenues
(up 43% from FY21)
Motorpoint is well positioned to
deliver signiicant shareholder
value in the long term.”
John Walden
Chair
The Group has also sought out
commercial partners who, along with
myself and other Board members,
have previous experience in leading
digital and transformational change
which will lend itself to Motorpoint’s
transition to a digitally led business.
Embracing technology is essential
for the future of the business, and
will help us redeine and evolve our
exceptional customer experience
and leading value proposition for
a digitalage.
A responsibly minded
business
Motorpoint has made great strides
in progressing its ESG strategy,
propelling the Group towards being
a more responsible business. The
recently established ESG Board
Committee, and appointment of a
third party advisor who has consulted
with us on how to measure and
maximise our emission reductions,
reinforces our commitment to
operating in a sustainable manner.
We’re proud that we are now carbon
neutral on our Scope 1 and 2
emissions and are focused on driving
further improvements across the
business. The Group looks forward to
providing regular progress updates.
Value creation
I would like to thank all of my new
colleagues at Motorpoint, at our
Head Oice and across the branch
network, for their continued hard
work and commitment. Whilst the
current macroeconomic environment
and related pressures facing UK
consumers are obvious, I am excited
by the opportunity in front of us
and conident that Motorpoint is
well positioned to deliver signiicant
shareholder value in the long term.
John Walden
Chair
15 June 2022
Strategic Report Governance Financial Statements
1716
Motorpoint Group Plc
Annual Report and Accounts 2022
COVID-19 update
Reassessing the
way we operate
Following the lifting of lockdown in April 2021, our branches were able to remain
open for the remainder of the year. However, the pandemic has continued to aect
both ouremployees and customers in a number of ways, and has meant behavioural
changesformany.
During the periods of closure in FY21
we had to adapt quickly to a whole
range of challenges, whether it be
working from home, accelerating
our digital capability so all customers
could buy online with ease, or
launching free Home Delivery. Many
of the changes and learnings have
been retained, since they combine
to make our business stronger.
Although our branches were able
to successfully open in April 2021, it
was not necessarily the same in the
oice, and for many, home working
continued. Ensuring employee welfare
continued to be a vitally important
theme therefore.
During the inancial year, the Board
agreed to repay CJRS income of £81k;
this was the amount claimed in early
April before branches reopened, and
therefore related to FY22.
Continuing to respond
withagility and meeting
demand online
Record NPS score of 84 in FY22
Many of the innovations introduced
during the lockdown periods have
continued in FY22, to supplement
our omnichannel oering:
• Retail customers continue to
be able to purchase via our call
centre and digital channels; the
number of customers who require
no support or intervention to
purchase a car has increased
• 6,590 vehicles were prepared,
sold and delivered to customers’
homes, free of charge
• For many customers who still
wanted to view their car before
completing their purchase, we
continue to oer a streamlined,
contactless Reserve and
Collectoption
• Robust commitment to safety,
with strict COVID-19 compliant
procedures in place for the
majority of the year including
social distancing measures,
compulsory face covering in retail
branches, and thorough cleaning,
sanitisation of all surfaces
and vehicles.
Taking care of our people
Best company to work for in the
automotive sector
Employee support and wellbeing was
a key objective during the pandemic,
both in FY21 and FY22, since this
represented a major challenge to
the Company’s culture. Therefore,
the Board endorsed the following:
• Continued remote and
agileworking
• Contributions towards the cost
of working from home, for all
eligible employees
• Monetary gifts at Christmas
tocompensate for lack of
usualparties
• Encouraged an extensive
programme of employee
engagement, with a strong
focus on wellbeing
• Implementation of a COVID-19
secure working environment
across oices and retail branches.
Strategic Report Governance Financial Statements
1918
Motorpoint Group Plc
Annual Report and Accounts 2022
Chief Executive’s statement
Execution of these strategic
objectives provides further
evidence of Motorpoint’s agility
and entrepreneurialism to design,
test and implement new initiatives
at pace as market opportunities
arise. Motorpoint is leveraging its
exceptional industry knowledge to
continue increasing its market share
across all channels, accelerated by
investment in digital transformation.
Our ambitions for the business are
growing and we see substantial
shareholder value creation and
therefore we are increasing our
investment levels further in both
our customer proposition and
our investment in technology and
building our brand. We are more
convinced than ever that our
price leadership, strong customer
satisfaction and highly engaged
team are winning in an increasingly
competitive market.
Our operating model
begins with our team
The last two years or so has been
unprecedented, and our team has
been exemplary in their commitment
to the business throughout these
diicult times. Our team continues to
inspire me and I am grateful for their
passion, energy and enthusiasm for
our brand.
Our operating model of how our
key stakeholders interact is well
understood by our team and is
covered in detail, usually by myself,
with every new starter when they
attend our induction programme.
The Motorpoint Virtuous Circle
combined with our Values of Proud,
Happy, Honest and Supportive
continue to provide a robust
framework for explaining how we
get things done and what factors to
consider when decisions are required.
Our team also has an opportunity to
ask open questions and understand
key decisions in their interaction with
our Senior Leadership Team, who
host Team Forums at each branch,
or virtually, every month. Many of the
improvement areas in the business
are found in these sessions and our
team often has a creative solution to
issues we are facing whether they
be people, customer or operational
challenges. We also ensure each
member of our team has a one on
one meeting with their Manager
each month, to ensure pastoral and
performance conversations happen
regularly, which contributes to our
ongoing high levels of employee
engagement.
The learning and development of our
people is vital to the future success of
our business. Our new Learning and
Development platform launched last
year to the entire Company allows
individual learning journeys to be
created, logged and reviewed.
We believe that the happiness
of our team is directly correlated
to our customer satisfaction and
engagement can be enhanced by
giving something back to the team.
Our ‘One Big Dream’ initiative has
been a huge success, with our people
using two paid hours per month for
their own fulilment.
We continue to have fantastic
examples of our team using this time
to follow their dreams, whether it
be to attend a class or watch their
child in a school production. Since
2017 we have committed to being a
Real Living Wage employer and we
launched our sixth SAYE scheme in
the second half of this year, again
oering the opportunity to become a
Motorpoint shareholder to our entire
team, with strong uptake. Finally, none
of our team has had to work on their
birthday since 2015, something we
believe is a great beneit and is unique
in the UK.
Our annual participation in the
‘bHeard Best Companies to Work For’
provides an opportunity for our team
to provide honest, valuable feedback
on their engagement levels and
how we can improve these further.
I am proud that we again achieved
Top 100 status in The UK’s 100 Best
Companies to Work For. This is the
eighth consecutive year that we have
been placed in the Top 100 and is
testament to the hard work of our
management team in listening and
acting on our people’s feedback.
We were also Number 1 in the
Automotive category.
We have a responsibility to improve
diversity and inclusion in our industry.
We appointed a Head of Recruitment
and Inclusion in December 2020 and
have continued to advance our plans
during the year.
The right
culture to
succeed
E
M
P
L
O
Y
E
E
S
S
H
A
R
E
H
O
L
D
E
R
S
C
U
S
T
O
M
E
R
S
Our core values
HAPPY
HONEST
SUPPORTIVE
PROUD
Strategic investments to
continue to grow market share
We’re the UK’s leading omnichannel
vehicle retailer, investing now for
future strategic growth.”
Mark Carpenter
Chief Executive Oicer
Overview
We continue to oer our customers
every possible way of buying a vehicle
to ensure everyone can access
our outstanding price leadership
proposition. In addition, during the
year we successfully launched our car
buying service to increase our supply
channels as new car supply continues
to remain subdued.
I am especially pleased with
our achievements in the year.
We have successfully navigated
unprecedented vehicle inlation and
widely documented supply shortages.
These shortages undoubtedly limited
our growth, yet we still managed to
deliver revenue and proit before
taxation growth of 83% and 122%
respectively, and our retail unit
volumes grew by 46% on FY21. We
also continued to grow our market
share, to 3.1% of the 0-4 year old
market (FY21: 2.4%).
Strong progress has been made
on our medium term strategic
targets, with three new branches
opened successfully in the second
half ofFY22, namely Manchester,
Maidstone and Portsmouth, in
addition to our new preparation
centre in Motherwell, Scotland.
In line with our objective to leverage
E-commerce platforms to expand
our supply channels, the Motorpoint
car buying service is now a fully
automated digital irst oering
and payments are made to sellers
within minutes of the vehicle being
received. Our Auction4Cars.com
trading platform has also now been
successfully upgraded to operate as
an automated marketplace to include
third party vendors. This is being fully
launched to further new vendors in
FY23 and will enable them to auction
their own vehicles digitally.
During a year of much change in our sector our omnichannel proposition has continued
to excel, providing customers with our winning proposition of unrivalled Choice, Value,
Service and Quality.
84
Net Promoter
Score
In a year we have
stocked over
600
models
3.1%
market share (0-4 year
old car market)
Strategic Report Governance Financial Statements
2120
Motorpoint Group Plc
Annual Report and Accounts 2022
Chief Executive’s statement continued
ESG
During the year, the Group made
signiicant progress on its ESG
strategy. We recognise that climate
change is the most serious challenge
currently threatening the global
community and we understand
we have a role to play in reducing
greenhouse gas emissions. In
partnership with an independent
third party, a thorough stakeholder
engagement process and
independent materiality assessment
was conducted to ensure we
measure and maximise our emission
reductions. Through this process, we
have been able to understand and
then oset through the purchase
ofcarbon credits all our Scope 1
and2 emissions to be carbon neutral
on these aspects. Our priority is
tocontinue to reduce our Scope 1
and 2 emissions, and to focus on
Scope 3 emissions.
Motorpoint has always been
conscious of its sustainability footprint
and has recycled vehicle parts such
as tyres, batteries and brake discs
for many years wherever possible.
We have continued our partnership
with Go Green to support our drive
to become more eicient with the
classiication andsegregation of our
Motorpoint serves all buyers,
whatever their location, and whether
they wish to buy online, in person
at our branches, or through a luid
combination of both channels.
Motorpoint has become one of a
select number of businesses to be
included in the brand new Platinum
category in recognition for achieving
successive years of Feefo Gold
Trusted Service status.
Quality – our strategic vision is to
ensure that our omnichannel model
delivers the same exceptional
experience in any channel with
whichthe customer chooses to
interact. Our ambition is to be the
most trusted automotive retailer, and
this means quality across everything
we do, with complete focus on our
customers’ needs.
Strategy Update
In June 2021, we announced our
objectives to signiicantly increase our
rate of growth, with the aim of at least
doubling FY20 revenue to over £2bn
in the medium term, by:
• Growing our E-commerce revenue
to over £1bn by substantially
increasing investment in
marketing, technology and data
• Opening 12 new sales and
collection branches to service
revenue growth, increasing
investment in the customer
proposition, and expanding
our supply channels
• Leveraging our E-commerce
platform Auction4Cars.com
to accommodate new supply
channels and to launch our
marketplace oering
• Increasing operational eiciency
through further automation
and technology investment
as customers migrate to
E-commerce channels.
Overall revenue grew 83.3% from
£721.4m to £1,322.3m. Around 60%
of transaction volumes were
online inFY22 (FY21: 69% which
was inlated by branch lockdown
closures). E-commerce revenue
grew to £624.9m (FY21: £437.1m).
Consequently, we are ahead of plan
to grow revenue to £2bn.
As planned, we invested heavily in
the period in capability, technology
and marketing. We are excited by
our strong progress one year in, and
as a result are accelerating our pace
of investment in transformational
change. We have completed a
third party audit of our tech stack,
and a future road map has been
developed. A signiicant number
of new technology roles have been
recruited, with the focus on engineers
and enabling our migration to the
cloud. Our new Chief Digital Oicer
was recruited in February 2022, and
we are already seeing the beneits this
new experience brings as we execute
our shift to become an agile, product
led digital leader.
We have made signiicant
improvements to our website, email
communications and targeted
digital marketing activity. Website
traic improved by 15% compared
to the same period a year ago, and
improvements have been made in
all email metrics, with unsubscribe
rates dropping to just 0.1%. We have
invested in data science tools and
talent and this now supports buying
and pricing decisions and targeted
customer communications; we are
excited by the opportunity this brings.
Three new branches opened
successfully in the second half of
FY22, namely Manchester, Maidstone
and Portsmouth, each strategically
signiicant regions for the Group.
Ourestate has therefore expanded
to 17 branches. The future pipeline
remains strong and further openings
can be expected in FY23 as we
expand our geographical footprint
toincrease market share.
Good progress
against strategic
objectives, with strong
advancements in
technology, branch
expansion and resultant
market share growth.
waste, which is reported on page
36. The past year has seen 81% of
all business waste recycled, and our
total waste to landill igure dropping
below 1%. The next inancial year will
see us make further improvements
to reduce our waste to landill igure.
The Board is also pleased to
announce that its recently established
ESG Committee will be chaired
by Adele Cooper, an existing Non-
Executive Director. Adele’s role is
in addition to the appointment of a
specialist Sustainability Manager, who
joined the Group in September 2021,
to lead on the process outlined above.
Customers
Our highly engaged team continued
to deliver our market leading
proposition of Choice, Value,
Service and Quality to our loyal
customers during the period. We
have an unerring focus on customer
satisfaction. We take it personally
when a customer is not happy,
as we have failed if this happens,
and immediately look to remedy
any dissatisfaction. We want our
customers to be delighted. Our Net
Promoter Score (‘NPS’) was a record
high 84 in FY22 (H2 FY21: 83).
This level of customer loyalty is
recognition of our strategy of
delivering unrivalled Choice,
Value, Service and Quality:
Choice – our unique independent
model allows us to source and sell
from the broadest range of suppliers,
allowing us to lex our oering to
achieve the greatest value for our
customers. We also launched our
digital car buying service in the year,
which is another important supply
channel for Motorpoint. In the year we
have stocked well over 600 models
from 38 manufacturers, and we
are able to rapidly follow emerging
customer preferences, such as
through our increasing proportion of
hybrid and electric sales. Our range
increased in the period with a greater
proportion of prestigious vehicles,
as well moving into the greater than
three year old car market, where we
quickly gained market share.
Value – we are an omnichannel
vehicle retailer, predicated on working
to a high volume and keeping our
cost base low. This allows us to share
value with our customers, reinforcing
our volume model. We oer all
customers inance and ancillary
product oerings, where we also
champion low prices, illustrated by
our decision to again reduce our
inance APR rates, from 9.9% to 8.9%
in October 2021. For higher value
vehicles (over £35,000) our APR
rate is 7.9%. Our Value proposition
continues to appeal during these
uncertain times.
Service – service is what will
ultimately set us apart in the market.
We measure ourselves primarily
using NPS – on this measure we
have improved again, with a record
score of 84 (H2 FY21: 83). We are
delighted with this level of customer
satisfaction, but are always striving
for more, and constantly challenge
our processes to make the buying
experience as smooth as possible.
Strategic Report Governance Financial Statements
2322
Motorpoint Group Plc
Annual Report and Accounts 2022
Our Motherwell preparation centre,
our second dedicated preparation
site, opened in August 2021, and has
the capacity to prepare 20,000 cars
per annum; retail preparation capacity
is now in excess of 120,000 units
perannum (on a single shift basis)
and provides headroom as we grow
the business.
In line with our objective to leverage
E-commerce platforms to expand
our supply channels, the Motorpoint
car buying service is now a fully
automated digital irst oering and
payments are made to sellers within
minutes of the vehicle being received.
This is an area we intend to grow
signiicantly as awareness of our
highly competitive oering increases.
During FY22, 17.9% of retail vehicles
sold were sourced from consumers
(including part exchange) (FY21:
8.3%). Our Auction4Cars.com trading
Chief Executive’s statement continued
Further information
Our strategy
Read more / page 24
Financial review
Read more / page 54
It’s important that we
measure our performance
Financial KPIs
1
Non-inancial KPIs
Key performance indicators
1. Deinitions of terms can be found in the Glossary on page 148.
2. The KPIs for FY18 and FY19 have been restated following the adoption of IFRS 16 in FY20,
with the exception of the ROCE igure for FY18.
3. The 2021 data is based on H2 of that year, which is considered to be a more representative
due to lockdowns during the COVID-19 pandemic.
PBT (£m)
2
£21.5m
PBT was £21.5m, up 121.6% on FY21.
InFY21,PBT was signiicantly impacted
bythe pandemic and Government
imposed lockdowns.
Gross proit (£m)
2
£106.3m
Gross margin was 8.0% (FY21: 8.7%) and
it moderated during the year, relecting
the inlation pattern, despite continued
improvements in our preparation processes,
even as we introduced vehicles over three
years old.
Net Promoter Score
3
84
Customer satisfaction has continued
to strengthen, with record levels of
NPS being maintained.
EBITDA (£m)
2
£32.3m
EBITDA increased 76.5%, relecting
revenue growth, and despite accelerated
investment in technology and marketing.
ROCE
2
74.6%
Return on Capital Employed increased
to 74.6% in FY22.
Digital leads
643k
Given our increased focus on being a digitally
led business, we have introduced a new
KPI relating to the total number of leads,
including part exchange and sell your car.
This year saw a total number of leads through
digital channels of 643k, representing an
increase of 95% on prioryear.
Number of branches
17
Three new branches opened in the
secondhalf of FY22, taking our total
number of branches up to 17, and
improving national coverage.
platform has now been successfully
upgraded to operate as an automated
marketplace to include third party
vendors. This will be fully launched
to further new vendors in FY23 and
will enable them to auction their own
vehicles digitally. We are excited by
the opportunity this presents and look
forward to providing further details in
due course.
Motorpoint is an agile business with
growing brand awareness, low ixed
costs and a compelling operating
model that has always oered its
customers the best value proposition
in the UK used car market. We have
always sold cars online, irst through
a call centre handling online enquiries
and now through a fully integrated,
end to end digital customer journey.
This digital led experience will
continue to evolve in accordance
with what our customers demand.
Fundamentally, we see this as
providing a large choice of high
quality vehicles at outstanding
value, and with best in class levels
ofcustomer service in each market
we operate in.
While pursuing these objectives
we increasingly appreciate the
signiicant changes to consumer
buying expectations and the changes
to the marketplace of used car
retail. As the largest omnichannel
used car retailer, we are excited by
the opportunity to lead, but we also
embrace the amount and pace of
change required at Motorpoint to
seize thisopportunity.
Mark Carpenter
Chief Executive Oicer
15 June 2022
2022
2021
643k
330k
2022
2021
2020
2019
2018
£21.5m
£9.7m
£18.8m
£22.2m
£19.9m
2022
2021
2020
2019
2018
£106.3m
£62.5m
£78.9m
£79.9m
£76.4m
2022
2021
2020
2019
2018
74.6%
52.7%
96.5%
96.2%
112.6%
2022
2021
2020
2019
2018
17
14
13
12
12
2022
2021
2020
2019
2018
£32.3m
£18.3m
£27.3m
£30.1m
£27.3m
2022
2021
2020
2019
2018
84
83
81
78
77
Strategic Report Governance Financial Statements
2524
Motorpoint Group Plc
Annual Report and Accounts 2022
Rapidly upscaling our
E-commerce capability
• New tech roles recruited, with focus
on developers and the cloud
• Future roadmap for our tech stack
• Data science solutions delivered
enhancing marketing performance
and supply and demand insights
• Digital journey improvements
including the development of a
full end to end purchase journey
on our website
• Improved email engagement
metrics, such as higher click through
and lower unsubscribe rates
• Chief Digital Oicer started in
February 2022
Expand wholesale and
E-commerce channels
• Investment in Auction4Cars.com
leadership, with industry experience
• Car buying service launched and
fully automated post soft launch
in July 2021
• Website users up 15% on previous year
• Auction4Cars.com successfully
upgraded to operate as an
automated digitally led marketplace
to include third party vendors
Increase customer
acquisition and retention
• Manchester, Maidstone and
Portsmouth open
• Share of voice growth and
improved brand awareness
• Salesforce CRM launched along
with Marketing Cloud
• Reduced repeat purchasing
timelines through new vehicles
upgrade communication
programmes
• Growth in MyMotorpoint accounts
• Expansion and investment in the
van market
Operational eiciency
through technology
and innovation
• Motherwell preparation centre
open, with 20k vehicle capacity
• New QC app launched to measure
preparation eiciency
• Prep time improvement from
9.7 days to 8.2 days per vehicle
(0–3 year old cars)
• Automated payments solution
launched
Read more about our strategy
performance on the following
pages / page 26–31
The Car Buyer’s Champion
Our strategy
Good progress was made in the year against the four pillars of our strategy.
1  UPSCALE
ECOMMERCE
CAPABILITY
3  OPERATIONAL
EXCELLENCE
2  GROW OUR
MARKET SHARE
Our strategy remains to grow revenue to more than £2bn in the medium term.
This will be delivered by continued focus on our customer, ensuring we meet
their needs and demands online while delivering the highest levels of service,
quality, and support through our growing nationwide retail network.
How our strategy performed in 2022
Despite the uncertain consumer outlook, the Group’s continuing conidence
allows it to invest in its future growth strategies across multiple initiatives.
The expansion of our technology team dramatically increases our capability
to innovate and scale our online platforms with both having huge future
growth potential.”
Mark Carpenter
Chief Executive Oicer
Strategic Report Governance Financial Statements
2726
Motorpoint Group Plc
Annual Report and Accounts 2022
The operating model for our
Digital function is completed, and
recruitment of key roles started with
the introduction of a Chief Digital
Oicer, Digital Marketing Director,
Principle Product Owner and several
supporting roles into the business
already completed. Continued
migration of externally supported
capability into in house teams,
providing greater agility and
speed of delivery.
8.8m
Online users
(+15.2% on prior year)
64%
Mobile trafic
(+23% on prior year)
Online retail revenue
£415m
2022 £415m
2021 £310m
643k
digital leads
(+95% on
prior year)
Over
23k
retail units
sold online
Our strategy continued
1  UPSCALE
ECOMMERCE
CAPABILITY
Strategy Performance for 2022
Accelerating our
transformation
to be a digitally
enabled market
leader
Link to strategy
Rapidly upscaling
our E-commerce
capability
Operational eiciency
through technology
and innovation
Motorpoint’s advert views
are up 218% compared to
the marketplace, which is
seeing a decrease of 18%.”
Autotrader Report
May 2022
The introduction of Salesforce
CRM along with Service Cloud and
Marketing Cloud has provided the
tools for the continual improvement
of customer journeys throughout the
car buying process.
Improvements to how data is
structured throughout the business
has enabled us to deliver improved
performance reporting, resulting in
improvements in the eectiveness
of our digital marketing activities to
drive sales.
Strategic Report Governance Financial Statements
2928
Motorpoint Group Plc
Annual Report and Accounts 2022
The branches we opened in FY22
are at smaller locations than those
in the legacy estate, and hold fewer
vehicles. Less employees are required,
and coupled with lower running
costs, operating margins can be
maximised, along with working
capital requirements.
These new branches are perfect for
our omnichannel model, since they
can act as collection centres and
hubs to service free Home Delivery,
as well as being more traditional
branches in their own right.
At Maidstone we are trialling self
service portals, where customers
have the choice of ordering their
vehicle on a screen, rather than
through a salesperson.
Three new stores
became fully
operational in FY22
17
branches
nationwide
60
minutes
We have next day free
Home Delivery within
60 minutes of
a branch
Our strategy continued
Strategy Performance for 2022
Online sales
through quality
and service
supported by our
increasing network
of branches
2  GROW OUR
MARKET SHARE
Market share (0-4 year old car market)
3.1%
2022 3.1%
2021 2.4%
Motorpoint is currently
bucking the trend for
searches, and views
and leads.”
Autotrader Report
May 2022
Link to strategy
Expand wholesale and
E-commerce channels
Strategic Report Governance Financial Statements
3130
Motorpoint Group Plc
Annual Report and Accounts 2022
• Right irst time is an aspirational KPI
metric and required the creation
and adoption of a new QC app
and reporting. Rework is costly and
wastes resource, impacting output
• The Motorpoint Standard was
also reviewed and updated
andcommunicated throughout
theorganisation
• QC app was launched in early
October 2021 and has delivered
step change performance
• Nine of our ten preparation centres
have upgraded image booths and
new turntable technology (video
and open doors)
• Quality control software was
introduced at the same time
and recruitment of direct labour
‘boothoperators’ to replace
contractor resources
• Consolidation of 29 national third
party contractors to three primary
partners is nearing completion and
single valet and repair contractor
initiative is on plan
• Preparation issues within 72 hours
of collection have been monitored
for more than 12 months
• Restructuring the technology
function, including the adoption
of new/dierent skill sets – setting
ourselves up for success.
8% reduction in
preparation time on
3+ year old cars in
FY22
The number of
preparation
issues has nearly
halved from
beginning of year
15% reduction in
preparation time
on 0-3 year old
cars in FY22
Our strategy continued
Strategy Performance for 2022
Quality included
as an additional
‘customer pledge’
to Choice, Value
and Service
And this has
delivered results
3  OPERATIONAL
EXCELLENCE
Operational eiciencies
DIGITAL SALES AND
SUPPORT TEAM
Sales enquiries received through
our website are directed to our
dedicated national sales team which
handles email, phone and web chat
enquiries. The team sell vehicles,
inance and ancillary products for
collection at a retail branch, arrange
transportation if required, value any
part exchange vehicle and support
our customers through the purchase
journey. Customers can now also
purchase directly from our website
without communicating with our
sales teams. In the event a customer
requires support, a dedicated digital
support team provides guidance
forour customers to ensure a
smoothtransaction.
GENERATING OUTSTANDING
CUSTOMER VALUE FROM
A LOW COST BASE
We are a low cost, high volume
business focused on generating
eicient returns through the eicient
deployment of capital resources.
Through a cost eective branch
opening and low operating cost
base and a relentless drive on stock
turn, management has been able to
generate strong, recurring levels of
return on capital employed.
Link to strategy
Operational eiciency
through technology
and innovation
Strategic Report Governance Financial Statements
3332
Motorpoint Group Plc
Annual Report and Accounts 2022
Section 172 statement
Our stakeholders at the
heartof our model
The Board has a duty to promote the long term, sustainable success of the Company
and of the wider Group. The baseline duty is set out in section 172 of the Companies Act
2006, but in reality, it is broader, and the Board considers a wide range of statutory and
other factors within its decision making process.
Board decision making will always encompass:
• the likely consequences of any decision in the long
term and the risks to the Group and its stakeholders;
• the interests and wellbeing of our people and the
communities where we are present;
• the impact of our vehicles and business on the
environment and the need to ‘decarbonise’;
• the Group’s relationships with its customers and
suppliers; and
• the importance of our reputation for integrity and
high standards of business conduct.
Motorpoint believes that a key mechanism in ensuring that
it makes good long term and sustainable decisions is open,
two way dialogue with all our key stakeholders. We believe
that understanding the perspective and needs of our
stakeholders is vital to the Group’s success.
Good governance, our business ethics and integrity are
essential to continue to be an attractive company for our
investors, employer for our employees, partner for our
suppliers and retailer for our customers.
This section 172 statement signposts some of the key ways
in which we have engaged with stakeholders across the
year ended 31 March 2022 and built conidence in the
sustainability of their relationship with the Group. It should
be read in conjunction with:
• the Chief Executive’s statement from page 18
topage22
• the Chair’s statement on page 14 and page 70
• the ESG report from page 35 to page 53
• the Risk landscape from page 58 to page 65
• the Chief Financial Oicer’s review from page 54
topage 57
• the Governance and related reports from page 67
topage 104
Engaging with our stakeholders
Engaging and understanding the needs of our key stakeholders has never been more important and is critical to the
Board’s decision making.
Stakeholder Why we engage How we engage
Outcomes and how feedback
reaches theBoard
Our people We have an experienced,
diverse and dedicated
workforce which we
recognise as a key asset of
our business. Therefore, it is
important that we continue
to develop the right
environment and Company
culture to encourage and
create opportunities for
individuals and teams to
realise their full potential.
• bHeard annual engagement
survey
• Appointed a new Head of
Internal Coms that has refreshed
our internal communication
approach
• Weekly all team member coms,
Motormouth, which we have
revamped this year
• As COVID-19 restrictions have
eased we have moved more of
our Learning and Development
activity back to face to face,
including welcome days where
our team meet the CEO or
members of the SLT
• Training and talent development
programmes
• Monthly CEO listening groups
called Happy Hour
• Designated NED overseeing
workforce engagement and
ensuring updates are provided
to the rest of the Board.
• bHeard results and annual people
plan presented to the Board at
January Board meeting
• Continued to oer health and
wellbeing initiatives with both
mental, physical and inancial
support. We committed to
ensuring we pay at least the
Real Living Wage
• People reports at scheduled
Board meetings
• Annual pay review and reports
to the Remuneration Committee
• We’ve invested in salary levels in
key strategic areas of the business
such as software engineering,
preparation and customer care
• Increased discount (to the
HMRC maximum of 20%) on the
Company’s Sharesave in order
to encourage greater “founder
mentality”.
Read more / pages 47–52
Our customers Our Choice, Value, Service
and Quality proposition
is reliant on having the
right partnerships to
enable us to deliver for
customers. We have an
unerring focus on customer
satisfaction and that leads
to 33% of customers repeat
purchasing from us.
• Direct feedback sought on a
regular basis via NPS (84 in
FY22), Feefo (Platinum rate)
and Google reviews
• Monitoring/reporting of sales,
footfall, website traic and
internet search analyses
• Social media and websites
• Direct contact in stores.
• High NPS score
• Strong repeat and referral
business
• Use of data to better understand
customer needs, and addressing
these
• Customer research is informing
the development of a vehicle
and customer data proile.
Our suppliers
and partners
It is crucial that we develop
and maintain strong
working relationships with
our suppliers, so we can
enhance the eiciency of
our business and create
value, and make sure we
treat suppliers in line with
our values and ethical
standards. We continually
assess our supplier and
partner network, and
leverage both internal and
external expertise to ensure
appropriate relationships
and fair economics.
• Standard terms of business
and regular supplier meetings
• Contingency planning should
there be a failure in the supply
chain
• Supplier and distributor
onboarding due diligence
(inancial, quality, business
integrity and compliance,
component supply, modern
slavery etc)
• Ongoing management
of supplier relationships.
• CEO and senior management
team focus on supply chain
challenges arising from expanding
into new channels and suppliers
• Engaging with a broad range of
suppliers and regular transition
between channels, with a similar
level of lexibility in our product
oering
• Further strengthening of supply
chain team and processes.
Strategic Report Governance Financial Statements
3534
Motorpoint Group Plc
Annual Report and Accounts 2022
Section 172 statement continued
Stakeholder Why we engage How we engage
Outcomes and how feedback
reaches theBoard
Our
communities
Our employees care deeply
about our communities. As
a responsible employer, we
want to contribute to the
economic development
and sustainability of our
communities.
• Community investment
initiatives
• Enter into partnerships to create
better gender balance within
the automotive industry
• Commitment to invest in the
successful and sustainable
delivery of careers and
education for young people
in our local communities
• Volunteering in the community.
• Awards and recognition
• Sponsorship and volunteering
by employees
• Continuing with our community
focused partnerships which
cement our contribution to the
economic development and
sustainability of these communities
• Raising funds for local charities
providing relief throughout
the COVID-19 pandemic, and
supporting frontline NHS workers
• We support Payroll Giving to allow
team members to support charities
that are important to them, many
of which will be local.
Read more / pages 50–51
Our
shareholders
As a company with a
premium listing on the
London Stock Exchange’s
Main Market, we need
to communicate clearly
and eectively with our
existing and prospective
shareholders to develop
their understanding of how
the Group’s businesses
are managed to generate
sustainable returns and
long term success.
• Annual Report
• Consultation with lead
investors and voting
advisory organisations
• RNS announcements
• Annual General Meeting
• Investor presentations
• Corporate website
• Roadshows arranged twice a
year to engage with investors
• Investors have the opportunity
to visit branches and meet a
range of employees.
• The Board is provided with regular
feedback on investors’ views and
market developments
• Despite the COVID-19 pandemic,
senior management held virtual
meetings with existing and
potential shareholders
• Face to face meetings with
investors
• We issued half and full year trading
updates via the RNS facility to
update the market on the inancial
performance of the business
• Our websites (www.motorpointplc.
com and www.motorpoint.co.uk)
provide a broad range of
information and data
• Monthly reporting on shareholder
trading.
Our
environment
Through channels such
as climate change and
increasing legislative
requirements, the natural
environment eects
many aspects of what we
do. Our own materiality
research also shows
that the importance of
environmental concerns
rated highly among our
other stakeholders. As a
business, we need to do
what we can to support our
environment to ensure a
sustainable business.
• Materiality research to highlight
key risk areas and identify
opportunities
• Monitoring of our GHG emissions
and ongoing reduction/osetting
activities to ensure we are as
carbon neutral as possible
• Continuous monitoring of our
waste and implementation of
improvements to reduce waste
to landill while increasing our
overall recycling
• Ongoing implementation
andexploration of water
savingprojects
• Continued investment into
reduction and oset of our
indirect environmental footprint,
such as products sold.
• Newly formed ESG Committee at
PLC level to oversee ESG matters
• Environment as a key pillar of the
ESG Committee
• Sustainability manager appointed
whose role includes the
implementation of environmental
projects
• Formal ESG strategy developed
with three key areas linked to
ourenvironment
• Environmental performance
measures included in Annual
Report including waste and
GHG emissions.
Read more / pages 35–46
Environmental, Social and Governance
Embedding ESG into
our business
ESG has gained signiicant prominence as
a major issue within the industry in recent
years and we are proactively responding
to this.
Environment, Social and Governance (‘ESG’) is a huge
subject and is far too diverse to focus on everything in
this report. It is important to balance investment with
measurable growth while also balancing the views of our
various stakeholders. To enable the business to progress
eectively with an ESG agenda, Motorpoint has partnered
with Bright Space Communications. Bright Space came
on board to thoroughly research the business, highlight
opportunities and develop a formal strategy.
Our roadmap with Bright Space is split into ive steps
Step 1 Identify material matters
Step 2 Prioritise and agree material matters
Step 3 Validate and link material matters
Step 4 Create an implementation roadmap
Step 5 Integration and engagement
Step 1 was initiated and completed by the end of 2021.
Research was conducted to understand the external
context of our business and where we currently sit within
the market. Bright Space also reviewed our internal
strategy plans and risk registers before then conducting
internal and external stakeholder engagement interviews.
These interviews were further supported by an internal
survey distributed around the business to understand
the views of our people. The research highlighted ten key
areas that hold signiicance across our various internal and
external stakeholders (see chart below).
Environment and climate issues score highly both
internally and externally. Additionally, climate concerns
ranked as the most critical issue for the employees that
were surveyed. Electric vehicles were raised as a topic
notonly from an environmental perspective, but also
crossed over into social research responses. The general
consensus from a social standpoint is that this is the area
that the business currently stands out in, with a lot of the
work taking place being well understood. Governance
concerns were less prominent, but data privacy was noted
among stakeholders.
The next year will see us continue to move through the
steps of the roadmap. Step 2 is being initiated with the ESG
Committee focusing on these identiied areas.
1
GHG emissions and reductions
2
Fair and inclusive workplace
3
Employee acquisition, talent
management and retention
4
Business continuity and recovery
5
Data privacy management
6
Recycling, waste recovery and reductions
7
Cybersecurity and information security
8
Energy use, conservation and reductions
9
Supply chain management
10
Changing consumption patterns
10
9
8
7
6
5
4
3
2
1
0
0 1 2 3 4 5 6 7 8 9 10
Impact on Motorpoint Value Creation
Environmental GovernanceSocial
Signiicance for Stakeholders
Ten key areas
2
3
6
8
1
45
7
10
9
Strategic Report Governance Financial Statements
3736
Motorpoint Group Plc
Annual Report and Accounts 2022
Environmental, Social and Governance continued
ENVIRONMENT
The Group takes its responsibility towards
the environment very seriously and has
introduced many initiatives focused
onreducing waste, water, improving
energy eiciency and reducing its overall
carbon footprint.
Go Green
Our partnership with Go Green has continued throughout
FY22, driving us to becoming more eicient with the
classiication and segregation of our waste. With processes
now established following the 2020 rollout, focus is now
shifting towards improvements.
We are actively pursuing dierent waste collection hauliers
to reduce our waste to landill igure. We have also reduced
our total number of waste collections across all sites,
including the removal of many obsolete, conidential waste
bins. Next inancial year will see further drives to reduce
our waste to landill igure, and a push to better segregate
our food waste, with the addition of food waste bins to be
implemented in FY23.
Key waste statistics 2022 2021
Total waste removed by Go Green 948.2t 495.6t
Percentage waste to landill 0.9% 2.9%
Percentage waste recycled 81.0% 52.5%
Percentage waste recovered 18.1% 44.4%
Tyre casings collected and recycled 11,235 4,528
Percentage of purchased casings recycled 80% 82%
FY22 saw a 91% increase in waste removed by Go Green
when compared to FY21. The FY22 total waste removed
igure is representative of the entire estate’s waste,
where as in FY21 services were being moved over to the
Go Green contract throughout the year. Site openings
and refurbishments also play a part in waste increases,
as additional skip movements are required during such
projects. In addition to the Go Green contract now being
fully implemented, we saw signiicant improvements
on the waste hierarchy. 81% of all business waste was
recycled, with our total waste to landill dropping to
under 1%.
In FY21 we implemented a partnership with Stapletons
to allow us to recycle our tyre casings directly rather
than disposing of them. By the start of FY22 all sites had
switched over to the Stapletons process and as a result
over 11,000 casings were returned for recycling, preventing
them from entering regular waste streams. In total this
represented 80% of all casings purchased by the business,
a igure we hope to improve on through FY23.
Water reduction – HSG UK
The beneits of a water reduction plan are two fold,
providing both a inancial beneit as well as doing the
right thing for the environment. To support us on our
water reduction journey we have partnered with HSG UK.
As a business, HSG UK has a unique portfolio of industry
leading products that not only support with washroom
hygiene but also water saving.
Towards the end of FY22 HSG performed location
inspections of our washrooms and by use of their award
winning Ureco urinal insert have produced proposals that
not only have signiicant water savings, but also inancial
and carbon savings too.
As of the end of the inancial year, all current branches
have been surveyed and the estimated water and inancial
savings are as follows:
Annual igures
One-o installation costs (£) 1,525
Annual servicing costs (£) 11,279
Annual water cost saving (£) 21,760
Net year 1 savings (£) 8,956
Net year 2 and onwards savings (£) 10,481
Due to the reduced number of urinal lushes thanks to
the Ureco devices, the water savings equate to a £21,760
saving on the annual water bill.
Environmental igures (three-year contract)
Total water saving (litres) 26,113,560
CO
2
reduction (tonnes) 27.47
Over the course of the initial three-year contract period,
over 26 million litres of water is projected to be saved,
aswell as a reduction in our carbon footprint.
Birmingham Clean Air Initiative
Since the inception of the Birmingham Clean Air
scrappage scheme, Birmingham City Council has
partnered with us to oer people working in the
Clean Air Zone the chance to scrap their old car and
receive £2,000 credit towards a compliant vehicle,
or a mobility credit. Throughout FY22 the business
has continued to support this scheme as we actively
promote it to our customers and provide advice on
how they can apply.
Carbon reduction and osetting
We recognise that climate change is one of the most
serious environmental challenges currently threatening the
global community and we understand that we have a role
to play in reducing greenhouse gas emissions. In addition
to this, new UK legislation will relect stricter carbon
requirements in the wake of COP26.
Our aim is to be carbon neutral, and we achieved that this
year for our Scope 1 and 2 emissions. This was through
the development of a process with our partners at iOset,
a member of the Net Zero group. The emissions were
calculated based on our electricity, gas, fuel and business
travel. We then oset these emissions by purchasing
accredited carbon credits from projects in Indonesia and
Uruguay. This process ensures that Motorpoint’s scope 1
and 2 emissions are carbon neutral, and scope 3 emissions
will be the focus in future years.
The next phase of our partnership focuses on the emissions
of our sold products. We have already secured 65,000
tonnes of carbon credits from a United Nations operated
carbon scheme, and expect this activity to continue. This
will also include an education programme to increase
customer awareness, and how they themselves can reduce
or oset their own carbon emissions. FY23 will also see us
begin to implement digital strategies, such as a free to use
online portal that can be utilised by customers to further
improve and oset their own CO
2
.
Energy management and reduction
We are committed to responsible energy management
and will promote energy eiciency throughout our
organisation.
FY21 saw us shift to more sustainable behaviours, many
ofwhich were expanded upon throughout FY22:
• Ongoing process of replacing existing lighting
with LED lighting in all locations
• Continued with home working where possible,
despite easing of COVID-19 restrictions
• Encouraged use of online meetings
• Reduction in travel, and continual communication
to all sta of hints and tips to reduce everyone’s
carbon footprint.
Strategic Report Governance Financial Statements
3938
Motorpoint Group Plc
Annual Report and Accounts 2022
Environmental, Social and Governance continued
This year has also seen us engage with Planet First,
another member of the Net Zero group, to take our energy
management a step further. With this partnership we will look
to develop a utilities veriication and management system.
This will include an online portal which will allow better
visibility of each individual location’s energy consumption.
It will also allow us to detect any spikes or dips against
normal energy usage to allow us to take action and improve.
Once clearer visibility has been established we can then
look to implement any energy reduction improvements
such as renewable energy, and change behaviours where
needed during FY23.
Methodology used in the calculation
of disclosures
SECR methodology was adopted, as speciied in
‘Environmental Reporting Guidelines: including Streamlined
Energy and Carbon Reporting and Greenhouse Gas
reporting guidance March 2019’ and used in conjunction
with Government GHG reporting conversion factors.
Streamlined Energy and Carbon
Reporting (‘SECR’)
We measure and report on carbon emissions in
compliance with SECR, covering energy use and
associated greenhouse gas emissions relating to gas,
electricity and transport, intensity ratios and information
relating to energy eiciency actions. In accordance with
the Companies Act 2006 (Strategic Report and Directors’
Report) Regulation 2013 The table to the right sets out
Motorpoint’s emissions in 2022, compared with 2021.
From an energy perspective the business has seen an
overall increase in energy usage during FY22 when
compared to last inancial year. While electricity and gas
saw minor increases our usage of fuel and increased
business travel contributed to an increase to our
overall CO
2
emissions. FY21 saw a substantial drop in
our emissions against FY20, predominantly due to the
branch closures and lockdowns caused by the COVID-19
pandemic. Because of this, our FY22 performance is
better compared to FY20.
FY22 energy usage is lower than in FY20, a great
achievement considering the additional site openings and
operations. Our usage of gas has dropped signiicantly
when compared to FY20, and we also saw noticeable
reductions in our electricity usage.
Diesel usage and business travel both represent increases
in our emissions when compared to FY20 but when the
overall emissions of the business are put into comparison
against our total square footage, FY22 still represents an
improvement against pre pandemic performance.
ENVIRONMENT continued
2022 2021
Total energy use covering
electricity, gas, other fuels
andtransport (kWh) 9,888,058 8,370,540
Scope 1 emissions generated
through combustion of gas
(tCO
2
e) 618.35 573.92
Scope 1 emissions generated
through use of other fuels
(tCO
2
e) 472.09 204.38
Scope 2 emissions generated
through use of purchased
electricity (tCO
2
e) 959.50 885.89
Scope 3 emissions generated
through business travel (tCO
2
e) 265.10 162.17
Total gross emissions (tCO
2
e) 2,315.04 1,826.36
Intensity ratio – total gross
emissions (kgCO
2
per sqft) 3.12 2.79
Note: Disclosures above are aligned with the SECR minimum
mandatory requirements for quoted companies: Global scope 1
emissions from combustion of gas/ fuel for transport purposes
and Global scope 2 emissions from purchased energy. Additional
disclosure of scope 3 emissions from business travel or employee
owned vehicles also included. Motorpoint ltd operates within the
UK only. Any other emissions fall out of scope for mandatory SECR
requirements and are not included.
A data analysis project took place to understand the average annual emissions
of our customers’ cars. This has been used to develop a customer emissions
oering, eectively making a customer’s irst year of driving a car, purchased
from Motorpoint carbon neutral, by osetting those emissions with carbon
credits. This also helps us on our journey to tackle Scope 3 emissions as
products sold are a major contributor.”
Strategic Report Governance Financial Statements
4140
Motorpoint Group Plc
Annual Report and Accounts 2022
We support the Task Force on Climate related Financial Disclosures (TCFD) and its
recommendations and are making TCFD aligned disclosures for all but two areas, these
being detailed scenario planning ( Strategy, ‘c’) and relevant scope 3 emissions disclosure
(Metrics and Targets , ‘b’), both of which are included in our pathway to full disclosure.
The Board of Directors is ultimately responsible for oversight of the climate related risks
and opportunities impacting the Group. The Board’s oversight is supported by three
committees who have delegated responsibility over various aspects of governing the
Group’s climate related risks and opportunities.
The following diagram sets out the responsibilities as follows:
We recognise that climate change is the most serious challenge currently threatening the global community and we
understand we have a role to play in reducing greenhouse gas emissions. The eects of a transitioning economy will
directly aect the motor industry throughout the value chain, evidenced by the UK Government’s commitment to the
end of the sale of conventional new petrol and diesel cars by 2030. We are committed to measuring and assessing the
impacts of climate risks and opportunities across our operations, physical branches, and supply chains.
a) Describe the Board’s oversight of climate related
risks and opportunities.
Climate related risks, including risks of a transitioning
economy as well as physical risks to Motorpoint sites and
branches are integrated as a part of our emergent risk
process, which is a part of our risk management framework.
The Board has oversight of climate risks and opportunities
through escalation via the Executive’s Risk and Compliance
Committee as well as the newly formed ESG committee
noted in the diagram above.
The Risk and Compliance Committee has a responsibility
to monitor and oversee emerging risks and as such our
climate risk register was reviewed at least quarterly by
the Board and key management personnel in the year.
As well as the Board, the Audit Committee provides twice
yearly overviews of the risks facing the organisation,
including climate change risk on the agenda.
b) Describe management’s role in assessing and
managing climate related risks and opportunities.
Management’s role is to ensure that the day to day
management of climate related risks and opportunities are
delivered along with delivering the strategy with respect
to osetting our carbon output, in line with our roadmap
to becoming a more sustainable business.
Speciic Group management activities in relation to climate
related risks and opportunities:
Our Head of Sustainability is responsible for implementing the
Group’s strategy in respect of water and waste management,
key elements in our ambition to be a more sustainable
business. In addition, our Head of Sustainability is responsible
for the measurement and reporting of our GHG emissions,
which are disclosed in line with SECR in the environment
section of the Annual Report (p.39).
Our inance function is responsible for supporting the
business in understanding the inancial impact of the Group’s
climate related risks and opportunities and has undertaken a
high level inancial analysis this year to help understand the
potential eects on the Group’s assets and costs.
All of the Group’s functions are responsible in
implementing risk management practices as deined in
the risk management framework, including in relation to
climate related risks and opportunities.
Board of Directors
• Increased focus on climate related matters
• Review and approve climate related risks and principal risks
• Quarterly reviews of climate related risks
• Chris Morgan, CFO, appointed as climate related risk register owner
Audit Committee
• Provides twice yearly
overviews of the risks facing
the organisation, including
climate change risk on the
agenda
• Reviewed Board paper in
January 2022 containing
climate related risks and
opportunities and planned
TCFD disclosures
Executive Risk and Compliance
Committee
• Delegated responsibility for identiication,
management and assessment of the Group’s risks
• Quarterly reviews of the Group Risk Register
• Quarterly reviews of the Group’s emerging risks
• Particular focus in the year on climate related
risks with a commitment to carry out the ongoing
management of those risks
• Twice yearly review of the Group’s principal risks
Environment, Social
and Governance (‘ESG’)
Committee
• Established an ESG committee
to be responsible for assessing
the Group’s environmental
sustainability strategy
Environmental, Social and Governance continued
TASK FORCE ON CLIMATE RELATED FINANCIAL DISCLOSURES ‘TCFD’ Governance
Our pathway to full disclosure is as follows:
Progress
2022
Future plans
2023
Performed a high level inancial
review of the asset classes and
cost categories likely to be
impacted most signiicantly
by climate change
Assess and develop the plan for
detailed scenario planning using
our high level inancial review as
the starting point
Starting to deliver our strategy
for transition of osetting our
organisation’s carbon output
Continued to measure and disclose
our Scope 1 and 2 GHG emissions
in line with SECR reporting, with
plans in place to measure a series
of Scope 3 emissions in the next
inancial year
Setting out our metrics and targets
to measure in future years (further
information on p.45)
Scope 3 emissions tracking
covering: employee commuting,
waste disposal and use of
sold products
Integrating our governance
structure and risk management
framework to manage climate
risks and opportunities
Strategic Report Governance Financial Statements
4342
Motorpoint Group Plc
Annual Report and Accounts 2022
a) Describe the climate related risks and
opportunities the organisation has identiied
over the short, medium, and long term.
Following the integration of climate risk and opportunity
this year into the Group’s risk management processes, we
have assessed our risks and opportunities, mapping them
to our principal risks and these can be seen in the table on
page 46.
This year climate related risks were decided to
be integrated as a part of the Group’s current risk
management processes. As such, all of the risks identiied
are within the scope of the Group’s emergent risk process
and none of the risks identiied were assessed as being
material in the short term. This will be carefully monitored
in line with the Group’s risk management processes and
will be enhanced by the Group’s plans around scenario
planning in the future.
b) Describe the impact of climate related risks and
opportunities on the organisation’s business,
strategy and inancial planning.
Whilst we have not performed scenario analysis, which
forms part of our pathway to full disclosure, during the
year we undertook an exercise as a part of our inancial
planning looking at future cashlows to ensure that
our climate related risks had been considered for any
increased costs when considering the value of our assets
and future forecasts. The indings from this work were that
when including these additional costs in future cashlows
in respect of climate related risks, there was no impairment
to assets identiied.
With respect to business and strategy, the Group
anticipates a natural shift in consumer choice towards
alternately fuelled and electric vehicles (‘EVs’) in the
medium term.
The Group has undertaken activity to prepare for this
which includes:
• Planning in place for increased electric charging points
for customer convenience at our branches;
• Planning in place for increased electric charging points
at our dedicated preparation centres;
• Technicians trained and ready to prepare EVs.
Other impacts in respect of business and strategy can
be seen on page 46 in our climate risk and opportunities
register which includes any current plans for risk
mitigations across our business and strategy.
c) Describe the resilience of the organisation’s
strategy, taking into consideration dierent climate
related scenarios, including 2° or lowerscenario
We currently do not have the necessary expertise to
disclose full scenario analysis in respect of our identiied
risks and are taking steps to be able to implement scenario
planning as a part of our progression plan towards full
TCFD disclosure.
The ongoing management of Motorpoint’s climate risks
is performed through the quarterly review of the Group’s
risk in the Risk and Compliance Committee. This will
be informed by the work of the newly established ESG
Committee, who will also meet quarterly. Our climate
risksand opportunities are mapped to our principal
risksand uncertainties, consistent with our approach
to fully integrate climate change risk into our risk
management practices.
a) Describe the organisation’s process for identifying
and assessing climate related risks.
The process for identifying and assessing climate
related risks is aligned with the Group Risk Management
Framework.
Climate related risks are within the scope of the Group’s
emergent risk process which feeds from function level
risk management as well as the Group strategy. Where an
emergent climate related risk is deemed to be material
to Group strategy it will be included in the Group Risk
Register. Group risks are subject to Group Risk and
Compliance Committee, Senior Leadership Team (‘SLT’)
and Board level review as shown in the diagram below:
Risk appetite set
by Plc Board
Group vision
3-year strategy
Group objectives
Annual plans & budgets
Group key risks/principal risks
Emerging risks
Finance
IT
Ops
Commercial
Legal
People
Reviewed by Function
Reviewed by Risk and Compliance Committee/SLT/Board
Central Function plans and risk registers
Our climate change strategy is underpinned by our desire to oset the carbon we
produce and to be a responsible, sustainable organisation whilst also ensuring climate
related risks are within appetite and opportunities are appropriately identiied and
maximised. We consider the short term horizon in line with our risk management
framework to be the possibility of a risk event crystallising before 2025. Medium term
analysis is deined as 2025 to 2030 and long term analysis being 2030 and beyond.
During the year, the CFO was designated as the risk owner for our climate risks
and opportunities.
During the year, the Board has discussed climate change risk and opportunity and
identiied both risks and opportunities for the eects of a transitioning economy as well
as physical risks of climate change. These have been through a process of review from
both the Group’s executive Risk and Compliance Committee and the Audit Committee.
Our summary climate risk and opportunity register is shown on page 46.
Strategy
Risk management
Environmental, Social and Governance continued
TCFD CONTINUED
Strategic Report Governance Financial Statements
4544
Motorpoint Group Plc
Annual Report and Accounts 2022
During the year we appointed a Head of Sustainability
to ensure that we have relevant expertise in respect
of climate change and our journey in a transitioning
economy. As well as this, steps were taken during the
year to engage with central function risk owners to
ensure that climate risks are appropriately escalated and
managed throughout our operations, in line with the risk
management framework.
b) Describe the organisation’s processes for
managing climate related risks.
During the year climate risks and opportunities were
managed using a dual approach.
Our journey towards being a more sustainable company,
including our strategic goal to oset the carbon that we
produce, will be managed by the ESG Committee, chaired
by Adele Cooper. The ESG Committee will meet quarterly
and ensure Motorpoint progresses on its journey of carbon
osetting and analysing our environmental impact.
Climate related risks, including risks of a transitioning
economy as well as physical risks to Motorpoint sites
and branches, are integrated as a part of our emergent
risk process, which is a part of our risk management
framework. A register was formed in the year consolidating
all of our climate related risks and these can be seen
on page 46. The risks on this register were all assessed
to be ‘emerging’ and as such are assessed as not
currently material to the Group’s strategy. The process
for managing individual risks is to carefully monitor the
impact assessment of these risks, with mitigating activities
actioned should any risk be deemed material and outside
of Group risk appetite.
All of the climate related risks identiied in the register of
emerging climate risks are related to the Group’s principal
risks, which have their own wider controls and mitigating
activities. As such the climate related risks include
mapping to the relevant principal risk. Details on mitigating
activities for the Group’s principal risks can be seen on
pages 61–65.
c) Describe how processes for identifying, assessing,
and managing climate related risks are integrated
into the organisation’s overall risk management.
Risk measurement and assessment is deined in the risk
management framework, and all of our climate related
risks (the register can be seen on page 46) were assessed
in line with the deined criteria for assessing emerging risks
to the business in the risk management plan.
Ongoing management of risks is performed in line
withourrisks management framework. Where assessed
to be material and outside of appetite, steps are taken
to agree mitigating actions to bring the risk exposure to
within appetite.
Our risk management framework states that risks are
managed on an integrated basis throughout our organisation
and as such, function level risk registers were updated during
the year to ensure consideration of new and emerging risks,
including climate related risks, where appropriate.
Risk management continued
Environmental, Social and Governance continued
TCFD CONTINUED
a) Disclose the metrics used by the organisation to
assess climate related risks and opportunities in
line with its strategy and risk management process.
The Group’s strategy is underpinned by a desire to achieve
carbon neutrality through osetting, and as such KPIs
are monitored closely, helping inform the Group over its
climate related risks. The metrics that the Group monitors
are within the scope of the ESG Committee which provides
oversight and governance. The day to day management
of the Group’s metrics and targets are within the scope of
the role of our Head of Sustainability who is responsible for
the implementation of our ambitions in becoming a more
sustainable business.
The KPIs are:
KPI 1: GHG Emissions (CO
2
scopes 1 and 2)
KPI 2: Internal Carbon Price per ton (£)
KPI 3: Expenditure/investment deployed toward climate
risk and opportunities (£)
In addition, the KPIs are used by Group Finance to aid its
inancial review of climate related risks. As none of the
assessed climate related risks were deemed to be material
to the Group, these KPIs are deemed appropriate, with a
commitment to review this again in FY23.
b) Disclose Scope 1, Scope 2, and, if appropriate,
Scope 3 greenhouse gas (GHG), emissions,
and the related risks
Our Scope 1, 2 and appropriate Scope 3 emissions are
disclosed as follows:
Scope 1, 2 or 3 Data Current reporting
Scope 1 Direct GHG
emissions
Already reported in line with SECR
reporting. Information is presented
in Annual Report (page 39).
Scope 2 Carbon value
of purchased
energy, gas
and fuel
Already reported in line with SECR
reporting. Information is presented
in Annual Report (page 39).
Scope 3 Purchased
goods and
services
Not currently tracked – part of
pathway to full disclosure.
Scope 3 Business travel Already reported in line with SECR
reporting. Information is presented
in Annual Report (page 39).
Scope 3 Employee
commuting
Not currently tracked but plans
in place to initiate a web app that
allows Motorpoint employees
to calculate their own footprint,
including their commute.
Scope 3 Waste disposal Not currently tracked – part of
pathway to full disclosure.
Scope 3 Use of sold
products
The GHG emissions of our cars
sold. We currently calculate the
average GHG emissions of our
annual vehicles to oset, and this
forms part of our pathway to full
disclosure.
Scope 3 Transportation
and distribution
(upstream and
downstream)
Not currently tracked – part of
pathway to full disclosure.
c) Describe the targets used by the organisation to
manage climate related risks and opportunities
and performance against targets
The principal target for the organisation is in line with
the strategy to reach net zero through carbon neutrality,
utilising oset. As such the KPIs disclosed above are
measured carefully to ensure that in the future, the
Group’s targets are met across Scope 1, 2 and 3 emissions.
The Group has metrics and targets that facilitate the measurement of the Group’s impact
on the environment, and monitor performance against the Group’s ambition with respect
to the carbon oset of operations.
Metrics and targets
Strategic Report Governance Financial Statements
4746
Motorpoint Group Plc
Annual Report and Accounts 2022
TCFD
Main Risk,
Sub Category
and Time Frame Risk Opportunity
Group Strategy &
Response
Link to
Motorpoint’s
Principal
Risks and
Uncertainties
TRANSITION
Risk of increased taxation
and regulatory requirements
as UK Government aims to
meet its own climate change
commitments.
Opportunities from more
sustainable operations
include:
• eiciency savings in
all locations;
• more eicient oices
leading to energy and
cost savings; and
• more eicient and
environmentally friendly
transport solutions.
Carbon osetting has
already begun to be
implemented and our
Head of Sustainability
along with the ESG
Committee are
managing our strategy
in respect of being
a more sustainable
business.
Regulatory and
Compliance
POLICY AND LEGAL
Long Term
TRANSITION
Technology risks include:
• not being able to meet
increased demand for electric
and alternate fuelled vehicles
leading to loss of market share.
Increased opportunity
for higher market share
of 0-4 year old electric/
alternate fuelled cars.
The Group is
expecting a shift in
consumer choice for
EVs and is already
training employees
and readying charging
facilities in prep
centres and branch
locations.
Competition,
Market and
Customers
TECHNOLOGY
Medium Term
TRANSITION
The cost of carbon osetting
becomes prohibitively expensive
due to a global push towards net
zero, pushing carbon prices up.
Eiciency and
sustainability savings
realised across operations
reducing the need for
carbon oset credits.
Carbon osetting
costs are monitored
as a KPI owned by the
Head of Sustainability
and governed through
the ESG Committee.
Economic
Vulnerability
MARKET
Long Term
Medium Term Limitations on aordable
customer inance availability
on electric/alternate fuelled
vehicles.
Increased opportunity
for higher market share
of 0-4 year old electric/
alternate fuelled cars
through solving inance
availability.
The Board maintains
oversight over its
partnerships on
customer inance
availability and is
currently comfortable
with its oerings in
this market.
Competition,
Market and
Customers
TRANSITION
Reputational risks if Motorpoint
does not respond eectively or
urgently to public concerns over
climate change include:
• loss of customer conidence
in the Motorpoint brand;
• failure to attract and retain
talent; and
• failure to attract and retain
investors.
Enhanced brand and
reputational credentials,
leading to wider
customer base and more
attractiveness as an
employer.
A materiality
assessment has been
performed with Bright
Space in the year and
the ESG Committee
will ensure climate
change, which
was identiied as a
key topic from this
assessment, is focused
on throughout FY23.
Brand and
Reputation
REPUTATIONAL
Medium Term
PHYSICAL
Physical risks of climate change
include:
• action from climate groups
impacts/disrupts business
operations;
• extreme weather events could
lead to site and inventory
damage;
• extreme weather events could
cause signiicant supply
chain disruption aecting
Motorpoint’s ability to move
cars quickly and eiciently; and
• extreme weather events could
increase competition for land
use, aecting Motorpoint’s
ability to expand to new sites.
Opportunities for
Motorpoint in respect of
its physical risks include:
• develop risk assessment
expertise to identify and
mitigate vulnerabilities
where they exist;
• work with transport
suppliers to improve
eiciencies and ensure
resilience to potential
disruption; and
• opportunity to run
smaller sites with a
reduced footprint
leading to eiciency
savings.
Group Finance has
undertaken a high
level review of the
forecast costs and
impacts on assets
as a result of climate
change, this will be
monitored further and
enhanced through
scenario planning
which forms part of
our pathway to full
disclosure.
Supply Chain
Disruption
ACUTE
Long Term
Environmental, Social and Governance continued
SOCIAL
From the very beginning Motorpoint has
been a people focused business; our team
members have always been at the heart of
our business model and our Virtuous Circle.
We have always stood up to be the Car Buyer’s Champion,
making sure our customers can buy a quality nearly new car
with no hassle from a trusted business that does things in
the right way. Then there are the communities that we work
within. Wherever we do business, we want to bring high
quality employment to the community through our team
members and their families, but more than that we want to
be a positive force for good, helping those less fortunate,
supporting those starting out in life, facilitating opportunities
and generally making sure that wherever we trade, the
community is a better place for having Motorpoint nearby.
Health & Safety
Over the last couple of years, Health and Safety has been
dominated by the response to the COVID-19 pandemic
and the Board has been focused on keeping our team
members and our customers safe. We implemented
many new processes and procedures. All the actions we
took in order to keep our teams and customers safe were
underpinned by a suite of risk assessments, guidance
documents and checklists which encompassed our end
to end business activities. External third party veriication
audits, completed by PIB, our health and safety advisor,
tested our controls and conirmed that our controls
were appropriate. These were further endorsed by
local authorities and Public Health England on the two
occasions when we self reported localised outbreaks at
the Sheield and Birtley branches. We also engaged with
local authority enforcing oicers carrying out the HSE’s
workplace COVID-19 surveys. We recorded team members
who had tested positive or were self isolating, and we also
centrally monitored conirmed cases to establish patterns
of infections, enabling us to take remedial localised action
where necessary.
As restrictions have been lifted and guidance eased, we have
adjusted our ways of working to relect the latest government
advice and best practice but we remain vigilant and are ready
to respond quickly should the situation require it.
Beyond our response to the COVID-19 crisis, the Board
recognises that the highest levels of safety are required in
order to protect our employees and customers. The Board
believes that all incidents and injuries are preventable, and
that all employees have the right to expect to return home
safely at the end of every working day.
The Group Compliance Manager, who reports to the Chief
Operating Oicer’ provides consultative support and advice
to managers at all levels for health and safety matters across
the Group. The Chief Operating Oicer reports monthly
to the Board on all key health and safety issues. The Board
requires that the Group systematically manages its health
and safety hazards, sets objectives and monitors progress
by regular measurement, audit and review.
Managers and supervisors across all levels in the Group
are responsible for managing the health and safety of their
teams as part of promoting and embracing a positive health
and safety culture. The Board emphasises the importance of
individual responsibility for health and safety at all levels of
the organisation, and expects employees to report potential
hazards, to be involved in implementing solutions and
to adhere to rules, procedures and Group policies. A key
element in the continuous improvement of health and safety
management is sharing best practice and lessons learnt
from incidents across the Group and the wider industry.
Accidents, incidents and near misses are investigated, with
actions generated to prevent recurrence.
To embed health and safety practices in the wider workforce,
we ensure that all our employees receive health and safety
training modules as part of a two year training cycle.
Completion is monitored centrally and late completers are
notiied to their line manager on a monthly basis.
The right
culture to
succeed
E
M
P
L
O
Y
E
E
S
S
H
A
R
E
H
O
L
D
E
R
S
C
U
S
T
O
M
E
R
S
Our core values
HAPPY
HONEST
SUPPORTIVE
PROUD
Strategic Report Governance Financial Statements
4948
Motorpoint Group Plc
Annual Report and Accounts 2022
Our People
Environmental, Social and Governance continued
963
Team members
334
New hires
87
Promotions
#1
best company
to work for in
the automotive
sector
4.2
Glassdoor
rating
87
Long service
Award
82%
would recommend
Motorpoint as a great
place to work to a
friend
Spread across
5, 10, 15 and 20
years’ service
awards
Our Values
We are proud
We are proud of
what we do, how
we do it and the
people who make it
happen – we stand
out from the crowd
and are proud to
work as part of
Team Motorpoint.
We are supportive
We have a one
team ethos and
understand that
together we achieve
more. We are a
united team focused
on a common goal
and vision and will
always help our
customers and
colleagues alike
#drivingdreams®.
We are happy
We enjoy what
we do and we
show it – a smile is
contagious and our
teams wear them
naturally with pride.
A happy team makes
for a better working
environment which
in turn translates to
a great customer
experience.
We are honest
We speak the truth
and give honest
feedback at all times;
this applies to our
teams, investors and
customers. Courage
and honesty are the
vehicles for positive
change and Team
Motorpoint has
embraced this.
We do all of this
together
We are equal parts of
the whole and we are
stronger together.
Our Values were updated and have been in place since 2018 and they continue to be a true relection of how we
work together at Motorpoint. In November 2021, we launched our Leadership Behaviours, demonstrating to leaders
at all levels across the business what good leadership looks like at Motorpoint and what we, and our team members,
expect from a Motorpoint Leader. These have been embedded across our processes to bring them to life and make
sure that we keep these front of mind.
FY22 Highlights:
Our people have always been the heart of our business. Our achievements this year can be attributed to our talented
teams who worked in line with our Values, demonstrating real resilience through yet another challenging year. Our people
have made sure that our customers have continued to receive industry leading service as demonstrated by Feefo /
Trustpilot; our preparation teams have looked after more cars than ever, ensuring only the very best quality cars are put in
front of our customers; and at Head Oice, our teams have supported the wider business and embarked on our strategic
digital transformation journey. Our approach to developing a high performing and inclusive culture is achieved through a
number of initiatives and is explained on the following pages.
SOCIAL continued
Equality, diversity and inclusion
We are determined to continue to build a culture
that is welcoming and inclusive to all, where people
are comfortable and free to be their genuine selves
irrespective of preferences, circumstances or background.
Our Head of Resourcing and Inclusion continues to work
across the business at all levels to help the business
highlight, educate and celebrate diversity of all types. She
is also very active across the wider automotive industry,
making sure that we are working together and sharing best
practice to tackle some of the industry wide issues we are
all facing. For Motorpoint, work in this area includes:
Cornerstone Employers’ Network –
continuing to support the next generation
We continue to be a Cornerstone Employer for the Careers
and Enterprise Academy. A Cornerstone Employer is a
business that is invested in the successful and sustainable
delivery of careers education for young people and commits
to join a leadership group of local businesses to support the
schools, colleges and young people in their area.
We maintained our partnership and delivered a signiicant
number of initiatives throughout the year, including the
Open Doors programme (which gives young people the
opportunity to take part in a series of sessions to gain an
insight into our business, meet employees and complete
work related tasks), reverse jobs fairs to improve employability
skills as well as a virtual employment project with Special
Educational Needs and Disabilities (‘SEND’) students.
We assumed the role of a lead employer for SEND schools
and are proud of the work we have started doing with
Project SEARCH as a Local Enterprise Advisor. Project
SEARCH helps young people from across Derbyshire with
dierent forms of learning disabilities to gain new skills
as well as practical, work based experience through a
structured personalised study programme as they look to
make successful transitions from school to a productive
adult life.
Partnership with the Automotive 30% Club
We have continued our membership and support of the
Automotive 30% Club this year and in December our CEO
Mark Carpenter was appointed as a new patron for the
club. On his appointment Mark said:
“Improving gender balance along with the creation of
an eective diversity and inclusion policy is fundamental
to the future of work in the automotive sector. Arguably,
these areas are some of the most important matters facing
the automotive industry today. For this reason alone, I am
delighted to accept the role of Patron for the Automotive
30% Club.”
The Automotive 30% Club undertakes a range of
campaigning and lobbying work and has inspired many in
the automotive industry to get behind a range of gender
balance initiatives and educational programmes for young
people regardless of gender.
Being able to share insight, networks and time with schools to help make
their careers services meaningful will deliver a more sustainable and positive
landscape for everyone. Many young people, through no fault of their own, do
not have the opportunity to experience what careers may exist for them and
the Cornerstone Employers’ network can help change that.”
Strategic Report Governance Financial Statements
5150
Motorpoint Group Plc
Annual Report and Accounts 2022
Gender Pay Gap
Male Female Gap
Average
bonus pay
£8,387 £2,331 72.21%
Total average
hourly pay
£18.53 £14.33 22.66%
Although we have made some great progress in
closing our Gender Pay Gap through the development
and recruitment of females into leadership roles, we
acknowledge there is still some work to be done to
further close our Gender Pay Gap. We will continue to
ensure equality across our key leadership roles; an area of
opportunity is our Sales Executive demographic. As only
6% of our Sales Executives are female, the average hourly
pay for this group sits within our Upper Quartile.
All roles at Motorpoint are eligible for a performance
related bonus which means that the vast majority of our
team received a bonus in the last 12 months, irrespective of
their gender. The bonus pay gap which we have reported
can be related to the gender split across the quartiles,
especially in the upper and upper middle quartiles, where
bonus is relative to base salary and where fewer females
occupy the highest earning roles.
Gender mix
Male Female
Senior
Leadership
8 (67%) 4 (33%)
Leadership 16 (80%) 4 (20%)
Manager 59 (67%) 29 (33%)
Team Member 653 (77%) 190 (23%)
All employees 736 (76%) 227 (24%)
The table above sets our gender breakdown at various
levels in the Company, including the breakdown for all
employees, based on the 963 individuals employed as
at 31 March 2022.
Our gender mix is in line with the wider automotive
industry but we always want to improve and lead the
industry, hence our involvement in the Automotive 30%
Club and an increased focus on graduates and apprentices
who generally provide a better gender mix for team
members joining us.
Motorpoint in the community
This year our approach to supporting our local communities
has been initiated on three levels. National, local and at
team member level.
National level
This year we signed up with our irst ever national charity
campaign, Global Radio’s Make Some Noise Campaign.
The aim of Global’s Make Some Noise campaign is
“Improving lives through small and local charities”. This
year the charity has supported 100 small charities in local
communities across the UK. This includes food banks,
mental health and domestic abuse helplines, carer support,
community projects and employment programmes.
Motorpoint is the oicial national charitable partner.
Our teams all really got behind delivering the Make Some
Noise activities – in particular the Jamie Theakston and
Amanda Holden road trip. The road trip managed to raise
a massive £149,000! The trip wouldn’t have been possible
without the hard work from team members involved,
including Bernardo Melero, Sales Controller Manchester
and Jordan Dean, Head of Retail North West and Scotland,
who chatted live on the Heart Breakfast show shouting
about all the great work Motorpoint team members had
done to raise this amazing igure for Make Some Noise.
Make Some Noise Day was also a huge success. All stores
made a huge eort to get involved and a number of the
charity reps across the business organised a range of
fundraising events. As a company we raised over £3,000
on the day.
Environmental, Social and Governance continued
SOCIAL continued Local level
Whilst the Make Some Noise campaign was a national
campaign with a local feel, we still recognise that our
branches often have long-standing local charity partners
and we continued to support these activities. During the
year the following fundraising activities were completed:
Branch Charitable Partner Sponsorships
Birmingham Birmingham Children’s
Hospital
Birtley Sir Bobby Robson
Foundation
Burnley Lancashire MIND Burnley Golf Centre
Derby Motorpoint Arena
Nottingham
Derby County
Community Trust
Glasgow &
Motherwell
Beatson Cancer Care
Newport Time for Tea – Dementia Motorpoint Arena Cardi
Oldbury Birmingham Children’s
Hospital
Peterborough Sue Ryder Thorpe Hall
Hospice
Sheield Cash for Kids South
Yorkshire
Stockton on
Tees
Sir Bobby Robson
Foundation
Swansea Time for Tea – Dementia Merthyr Tydil women’s
football team
Widnes James Bulger Memorial
Trust
Manchester We Love Manchester
Maidstone Demelza – Hospice Care
for Children
Team member level
We recognise that our team members have busy lives and
diering priorities outside of the workplace. Many of them
will have personal causes that are close to their hearts and
personal to them. To support them with this we continue
to oer all colleagues the opportunity to donate to these
causes via Payroll Giving.
Doing the right thing for our people
At Motorpoint we believe that the combination of our
focus on driving dreams, robust ESG credentials and our
people and culture, not only dierentiates us from our
peers but also gives us a competitive advantage.
We believe that Motorpoint is an amazing place to work
but we constantly strive to become an even better place
to work. The Virtuous Circle is at the very heart of the way
we do business as we genuinely believe that if we get it
right for our team members, they will get it right for our
customers and that will create stronger performance
for all of our stakeholders. We are very proud to have
been listed in the Best Companies Best Places to Work
list for seven consecutive years and are number 1 in the
automotivesector.
To ensure that we maintain our focus on team member
engagement and genuinely live our values Proud, Happy,
Honest, Supportive and Together, we undertake a wide
range of team member focused activities, some of which
are as follows:
Listening to our employees
We have taken part in the Best Companies b-Heard survey
for the last eight years and this gives us high quality
feedback from our team members on what they like about
working for Motorpoint and more importantly where we
can improve. This year 90% of our employees participated
in the survey and we achieved a 2 Star (outstanding)
accreditation. Of course the important thing about an
engagement survey are the actions that you take as a
result of the feedback and at Motorpoint all areas of the
business are expected to create an Action Plan based on
their team feedback and are measured on delivery against
those action plans.
Alongside the b-Heard survey every manager in the
business with more than three direct reports receives
an individual management rating known as MC3. This
provides feedback to every manager on how they
Motivate, Consider, Converse and Care for their teams.
Anyone with a 1 Star rating or lower has to present back
their learnings and Action Plan to Senior Leaders. This year
we will also be combining the manager’s feedback with our
new Leadership Behaviours.
As well as surveys, the SLT spend a signiicant amount of
time in branches speaking to colleagues at all levels. Mark
Carpenter also holds regular Happy Hour focus groups
with team members at dierent levels across the business
and the People Team also hold regular listening groups.
Strategic Report Governance Financial Statements
5352
Motorpoint Group Plc
Annual Report and Accounts 2022
Environmental, Social and Governance continued
Learning and development
During the pandemic all of our learning and development
oering moved online to support team members whilst
they were working remotely from home. During that time
we launched a new learning management system, My
Skills, providing a wide range of e-learning opportunities
to team members.
As restrictions have started lifting, we are starting to move
some learning and development opportunities back to
face to face. Our aim is to get the blend right between
online and face to face where appropriate to make sure
we are taking the most appropriate route in supporting our
team members’ professional and personal development.
We are also increasing our focus on the development
opportunities provided through apprenticeship and
graduate schemes. We currently have 38 apprentices
across all areas of the business. We have taken on our irst
intake of newly recruited preparation apprentices. This
is a key area of talent for us and the industry and we see
apprenticeships as a great way to ill the talent pipeline
in this diicult to recruit area. We have also launched our
irst ever graduate scheme with three new graduates
joining us, taking six-month placements on rotation across
the business. Our intention is to signiicantly expand the
number of apprentices and graduates we have over the
near term.
Wellbeing
The wellbeing of our team members has always been
important to us at Motorpoint. Happy and Supported
are two of our Values and our focus on the Virtuous
Circle means we are naturally concerned about how our
colleagues are feeling, emotionally, physically, mentally
and inancially. Of course the pandemic and more general
societal interest means that employee wellbeing has
become even more important in recent years and at
Motorpoint we have tried to stay ahead of this curve.
I’ve been at Motorpoint for 5 years and it’s my job for life. I’ve never worked
somewhere with a better focus on personal growth and range of opportunities.
Hard work is rewarded, and the Company shows faith and belief in the work
you do, they’re also there to support you if you need it and with the current
climate of uncertainty this security has been incredible to me.”
Scott Greensmith Digital Merchandise Manager
We have invested in mental health irst aid (‘MHFA’) training
and have made it compulsory for all managers in the
business to be trained as well as training further team
members in each of our sites to be able to oer support
locally when needed.
Our One Big Dream scheme gives the gift of time and
lexibility, and allows an individual to take time out, once
a month, fully paid, to do something that matters to
them. We only ask that employees do something that will
genuinely drive their happiness. This beneit has received
immensely positive feedback and has been used across
an array of activities. The diversity of people’s selection
demonstrates just how important it is to apply the lexibility
to our employee beneits in order to have a real impact on
personal wellbeing. We also give extra leave for birthdays,
moving house and getting married.
We continue to partner with Sovereign Healthcare to
provide a 24-hour employee assistance programme for
our team members. This provides a counselling hotline for
team members with issues across a wide range of subjects
that may be impacting their lives and gives potential
access to face to face counselling if required. We also
provide inancial support via Sovereign Healthcare to all
team members for key health treatment including optical
support, physical therapy and dental care.
We have recently relaunched our beneits platform My
M.O.T. (Motorpoint Oers and Treats) and have upweighted
our focus on wellbeing by oering our team members a
wide range of beneits, discounts, access to materials and
advice on physical, mental and inancial wellbeing areas.
Of course, one of the best ways to ensure our team
members’ wellbeing is to provide high quality jobs that
reward people well, providing fulilling and enjoyable work
in a supported environment with quality managers and
leaders. This provides opportunities to grow and develop
personally and professionally and that brings us all the way
back to the Virtuous Circle and our Motorpoint Values.
SOCIAL continued
We are committed to promoting a culture within Motorpoint where everyone does the
right thing and acts with integrity at all times. We require all employees and third parties
who act on our behalf to conduct business honestly and with integrity, and to take
personal responsibility for ensuring that our commitment to sound and ethical
business conduct is delivered.
Whistleblowing
We operate a conidential whistleblowing hotline which
is available for all of our team and our suppliers, to
give them the opportunity to raise any issues about
dishonesty or malpractice within Motorpoint, the results
of which areindependently collated and submitted to
the Risk andCompliance Committee. The Chief People
Oicer reports regularly to the Audit Committee on
whistleblowingmatters.
Anti bribery and corruption
Motorpoint has a zero tolerance policy in respect of bribery
and corruption. This extends to all business dealings and
transactions, and includes a prohibition on oering or
receiving inappropriate gifts or making undue payments
to inluence the outcome of business dealings.
Sta are required to disclose oers of gifts, hospitality
or other incentives with a value of more than £100. All
employees receive communication of the relevant policies
as part of the onboarding process and new versions are
sent out if updated.
The Group does not make political donations.
Treating Customers Fairly
Treating Customers Fairly (‘TCF’) is a regulatory
requirement and applies to all regulated irms in the
conduct of their business. The Financial Conduct Authority
(‘FCA’) regards fair treatment of customers by irms as a
key part of FCA regulation in the retail market.
TCF is a core foundation of delivering our retail proposition
of Choice, Value, Service and Quality, and is thereby
fundamental to delivering long term business value.
To this end the Board has reviewed and maintained our
Treating Customers Fairly and Vulnerable Customers
policy. Through concerted focus, TCF has become an
integral part of the culture and is subject to frequent and
rigorous scrutiny within all forums that consider, inter
alia, customer facing processes, sta remuneration, and
product selection. We are committed to delivering the best
possible service to our customers, with objectives across
the business relecting this aim.
In particular, the following business areas are under
constant review in light of changes to Motorpoint’s
business model, customer requirements or the
regulatoryenvironment:
• marketing practices, including promotional material;
• sales processes, whether on site, via the contact centre
or digital;
• customer communications;
• record keeping; and
• complaints handling.
A review and reporting environment has been developed
to ensure that Motorpoint’s high expectations are met, and
that all systems, people and processes are supported to
achieve our TCF objectives, including via:
• qualitative quality controls, such as after sale customer
interviews and mystery shoppers;
• quantitative quality controls, such as cancellation rates
for products within their cooling o period; and
• ongoing training and support for our team, including
personalised and scheduled refresher training.
Human rights
Motorpoint conducts business in an ethical manner and
adheres to policies which support recognised human
rights principles. We continue to address the risks of
modern slavery and human traicking, with the Board
debating and adopting the annual Anti Slavery Statement
and raising awareness of the risks across the business.
Wework with our suppliers to protect workers from abuse
or exploitation by communicating to them the terms of
ourAnti Slavery Statement and request their adherence
toour policy.
GOVERNANCE
A statement of the Group’s compliance with the Modern Slavery Act
2015 can be found on the Group’s website at | www.motorpointplc.com
Strategic Report Governance Financial Statements
5554
Motorpoint Group Plc
Annual Report and Accounts 2022
Financial review
Successful year despite
industry wide challenges
Even with the well documented challenges in our industry with unprecedented inlation
and new vehicle shortages which limited our growth, the Group had a successful year.
During FY22, the Group demonstrated its ability to respond
to market conditions and vehicle price inlation by successfully
increasing its stocking facilities, which now stand at £195.0m
up from £106.0m in FY21. This highlights the conidence
lenders have in our transformational growth aspirations.”
Chris Morgan
Chief Financial Oicer
Group inancial
performance headlines
When branches reopened back in
April 2021, we initially experienced
record sales and proitability. While
demand was still high, revenue
started to moderate from June
onwards relecting industry wide
stock shortages, although we
continued to increase market share in
our core market.
Revenue for the full year increased by
83.3% to £1,322.3m (FY21: £721.4m),
following strong consumer demand
for used vehicles and the Group’s
continued strong market share gains.
FY21 comparatives were impacted by
COVID-19. Total vehicles sold were
97.7k (FY21: 67.5k). Gross proit was
£106.3m (FY21: £62.5m), an increase
of 70.1%. EBITDA, as deined on page
148, increased by 76.5% to £32.3m
(FY21: £18.3m). Proit before taxation
increased by 121.6% to £21.5m (FY21:
£9.7m). This was even with a planned
increase in strategic costs, as the
business further invested in people,
technology and marketing.
Cash at bank increased to £7.8m
(FY21: £6.0m) and we utilised £29.0m
(FY21: £Nil) of the revolving credit
facility at year end. During the year
signiicant vehicle inlation impacted
stock valuations, and we accordingly
negotiated increases in our stocking
facilities from £106.0m at the start
of the year to £195.0m by year end.
The last tranche of this increase of
£30.0m was made available in the last
week of the inancial year and used in
the early part of FY23 to reduce the
revolving credit facility balance. By
23 May 2022, the Group returned to a
net cash positive position.
Trading performance
The Group has two key revenue
streams, being (i) vehicles sold to
retail customers via the Group’s
branches, call centre and digital
channels, and (ii) vehicles sold to
wholesale customers via the Group’s
Auction4Cars.com website.
During the year, Motorpoint launched
its car buying service, purchasing cars
directly from consumers, and is now
a fully automated digital irst oering
and payments are made to sellers
within minutes of the vehicle being
received. This is an important enabler
to increase the supply of retail vehicles
and the volume of transactions
through Auction4Cars.com. During
FY22, 17.9% of retail vehicles sold were
sourced from consumers (including
part exchange) (FY21: 8.3%).
Retail
Revenue from retail customers
was up 87.3% to £1,112.3m (FY21:
£593.8m), with 62.9k vehicles sold.
Retail volumes increased by 45.9%
over FY21. Due to the reduced
supply of vehicles in the market, we
expanded our oering from our core
market of vehicles under three years
old, to include greater than three
years old, again showing our ability
to successfully adapt at pace to
changing market conditions.
In the year, our share of the 0-4 year
old market increased to 3.1% (FY21:
2.4%). Our average market share
within a 30 minute drive time of a
branch was 7.7% (FY21: 5.5%).
Gross proit per retail unit for the
inancial year was £1,446 (FY21:
£1,254). In the irst half, gross proit
perretail unit beneited from
increased demand pushing prices
up combined with robust internal
changes in buying and pricing
strategies. After this period of
unprecedented month on month
inlation, prices stabilised in the
second half, albeit at record levels.
The Group also continued to focus
on internal processes within the
vehicle handling and preparation
side of the business. Improved
speed of preparation, combined
with strong cost control, has resulted
in eiciencies. This was despite an
increased cost of preparing vehicles
in the greater than three year
oldrange.
Finance per vehicle sold improved
signiicantly in the year, with an overall
penetration of 52% (FY21: 42%), and
a record 58% in the last quarter. Our
APR inance rates were reduced
further to 8.9% from 9.9% in October
2021 as we reinforced our belief of
being the best value car retailer in
the UK. Warranty penetration also
improved from 34% in FY21 to 49%.
Our new branches in Manchester,
Maidstone and Portsmouth opened
in the second half of the year, and
whilst early days, we are pleased
with performance thus far.
Wholesale
Wholesale revenue via Auction4Cars.
com, which sells vehicles which
have been part exchanged by retail
customers, or directly purchased
from consumers, increased by 64.6%.
Wholesale volumes were aected
by the move into 3-4 year old retail
criteria. 34.8k vehicles were
sold via this purely online platform
(FY21: 24.4k).
Gross margin strengthened to 7.3%
(FY21: 6.6%), relecting both the
market and internal pricing controls.
Gross proit per wholesale unit
was £440 (FY21: £344). By the year
end our Auction4Cars.com trading
platform had been successfully
upgraded to operate as an automated
marketplace to include third party
vendors, enabling them to auction
their own vehicles digitally.
Operating expenses
Operating expenses increased from
£49.9m in FY21 to £81.3m. COVID-19
relief of approximately £3.9m explains
part of this movement, along with
variable costs which were cut
wherever possible last year, due to
the COVID-19 lockdowns. This year
the Group made a planned uplift in
strategic costs, as we further invest
in people, technology and marketing.
Marketing costs in total were £18.9m
(FY21: £7.0m) and people costs
£34.7m (FY21: £25.6m). Marketing
costs included a greater proportion of
digital spend than previously, which is
expected to continue. In addition, sta
costs rose due to planned headcount
increases and bonuses. Customer
acquisition cost per retail unit was
£300 (FY21: £163), and people cost per
retail unit £552 (FY21: £594).
Exceptional items
There have been no exceptional items
in the year (FY21: £Nil).
Interest
The Group’s net inancial expense was
£3.5m (FY21: £2.9m).
Total interest charges on the stocking
facilities in the period were £1.5m
(FY21: £1.1m), which relected the
sharp increase in inventory valuation.
Interest on lease liabilities of £1.7m
(FY21: £1.6m) was incurred during
the period.
Interest on banking facilities was
£0.3m (FY21: £0.2m).
Retail customers Wholesale customers Total
Year ended
31 March 2022
£m
Year ended
31 March 2021
£m
Year ended
31 March 2022
£m
Year ended
31 March 2021
£m
Year ended
31 March 2022
£m
Year ended
31 March 2021
£m
Revenue 1,112.3 593.8 210.0 127.6 1,322.3 721.4
Gross proit 91.0 54.1 15.3 8.4 106.3 62.5
Strategic Report Governance Financial Statements
5756
Motorpoint Group Plc
Annual Report and Accounts 2022
Financial review continued
Taxation
The tax charge in the period is
for the amount assessable for UK
corporation tax in the year net of prior
year adjustments and deferred tax.
The eective rate of tax in the year of
21.4% (FY21: 21.6%) is higher than the
charge which would result from the
standard rate of corporation tax in
the UK of 19.0%. This relects timing
dierences relating to ixed assets
and adjustments made in respect of
prior years, partly oset by the impact
of the tax rate change on the deferred
tax asset.
Shares
At 31 March 2022, 90,189,885 ordinary
shares were in issue, of which
1,372,677 were held in the Employee
Beneits Trust.
Earnings per share
Basic and diluted earnings per share
were both 18.7 pence (FY21: 8.4 pence).
Dividends
No dividend was paid in the period
(FY21: £Nil) and the Board has not
recommended a inal dividend
(FY21: £Nil) while it focuses on
driving signiicant growth.
Capital expenditure and
disposals
Cash capital expenditure was £6.9m
(FY21: £3.6m), and primarily related to
the it out of the three new branches,
the dedicated preparation centre in
Motherwell and various branch reits.
All new properties were leased.
After the year end, the sale and
leaseback of our Stockton on Tees
site was completed. The freehold was
sold for £5.0m and leased backat
an annual rent of £350k. There
wasno material proit or loss on
thistransaction.
Balance sheet
During FY22, the Group demonstrated
its ability to respond to market
conditions and vehicle price inlation
by successfully increasing its
stocking facilities, which now stand
at £195.0m up from £106.0m in
FY21. In addition, the revolving credit
facility was increased to £29.0m from
£14.0m in FY21. The Group also has
an uncommitted overdraft facility of
£6.0m which remains in place and
was undrawn at the year end. Both
are agreed until May 2024.
Non current assets were £59.2m
(FY21: £60.9m) made up of £0.6m of
intangibles, £10.9m of property, plant
and equipment, £46.7m of right-of-
use assets and £1.0m of deferred tax
asset (FY21: £Nil, £16.1m, £43.6m and
£1.2m respectively). At the year end
the Group owned three properties,
being the preparation centre in
Peterborough, the Stockton on Tees
branch, and some additional land
in Glasgow. Stockton on Tees was
subsequently sold after year end
and leased back. As a result of the
intention to sell and leaseback both
Stockton on Tees and Peterborough
at the year end, there are assets
heldfor sale of £9.2m (FY21: £Nil).
All other properties are on leases
ofvarious lengths.
Included within intangible assets
was£0.6m in relation to IT projects.
The Group closed the year with
£228.4m of inventory, up from
£128.4m at FY21 year end. Whilst stock
would have been inlated at the end
of March 2021 due to a build up for
the post lockdown reopening, used
vehicle values increased considerably
in the year, with inlation of over 30%
since the FY21 year end. The Group
also broadened its mix of SKUs, with a
greater proportion of more expensive
vehicles. Days in stock improved to 54
days (FY21: 67 days).
At 1 April 2021 the Group had £106.0m
of stocking inance facilities available
with Black Horse Limited (£80.0m)
and Lombard North Central PLC
(£26.0m), and £89.2m was drawn.
During the year, in response to the
unprecedented inlation and move
in vehicle mix, both facilities were
increased, to £120.0m and £75.0m
respectively.
The Group also has a £35.0m facility
with Santander UK PLC, split between
£6.0m available as an uncommitted
overdraft and £29.0m available as a
revolving credit facility. At the year
end, the revolving credit facility was
fully drawn, due to the timing of the
availability of the stocking increase.
This revolving credit facility was
increased by £15.0m during the year
and replaced the temporary £15.0m
bank overdraft which expired earlier
in May 2021.
Trade and other receivables have
increased to £13.6m (FY21: £7.7m),
relecting the increased volume and
sales mix at the respective year ends,
with most sales being online in March
2021 due to COVID-19. When sales
are made online the cash reaches
us instantly. When sales happen in
branches the use of card machines
brings a timing delay and increases
the debtors balance. In addition,
inance penetration increased to 52%
(FY21: 42%) leading to an increase in
commissions due.
Trade and other payables, inclusive
ofthe stock inancing facilities,
have also increased to £193.8m
(FY21: £125.7m), primarily relecting
increases in the stocking facilities
to£147.0m (FY21:£89.2m).
Borrowings relect the use of the
revolving credit facility. By 23 May 2022,
the Group had recorded a net cash
positive position. The increase in
total lease liabilities to £52.8m (FY21:
£49.3m) relects the new branches.
Cash low
Cash low from operations was
£(5.5)m outlow (FY21: £12.4m inlow).
The majority of this drop relected
the signiicant inlation coupled with
increased vehicle volumes, raising
inventory values by £100.0m in the
year, and the timing of the stocking
inance availability.
Other main items in the cash low
include capital expenditure of
£6.9m (FY21: 3.6m), payments to
satisfy future employee share plan
obligations of £5.0m (FY21: £0.4m),
an increase in borrowings of £29.0m
(FY21: £10.0m repayment), principal
lease repayments of £4.0m (FY21:
£3.6m), interest payments of £3.5m
(FY21: £2.9m) and tax payments of
£2.3m (FY21: £2.8m).
Capital structure and
treasury
The Group’s objective when
managing capital is to ensure
adequate working capital for all
operating activities and liquidity,
including a comfortable headroom
to take advantage of opportunities,
or to weather short term downturns.
The Group also aims to operate an
eicient capital structure to achieve
the business plan.
The Group’s long term funding
arrangements consist primarily of
the stocking inance facilities with
Black Horse Limited and Lombard
North Central PLC (to a maximum of
£195.0m), trade and other payables,
as well as an unsecured loan facility
provided by Santander UK PLC,
split between £6.0m available as an
uncommitted overdraft and £29.0m
available as a revolving credit facility.
This loan facility with Santander UK
PLC is due to expire in May 2024.
Chris Morgan
Chief Financial Oicer
15 June 2022
Strategic Report Governance Financial Statements
5958
Motorpoint Group Plc
Annual Report and Accounts 2022
Risk management
Continuous identiication
andreview
The expanded role and remit of the Group Risk and Compliance Committee is
testamentto our commitment to continuously strengthen and prioritise risk
managementin theCompany.
Approach to risk management
The Board is accountable for maintaining a policy of
continuous identiication and review of the principal
risks facing the Group which could threaten its future
performance or business model. On behalf of the
Board, the Audit Committee reviews the eectiveness
of Motorpoint’s risk management processes.
Motorpoint’s prioritisation of risk management was
strengthened and enhanced during the year through the
expansion and subsequent renaming of the Compliance
Committee to the Group Risk and Compliance Committee.
The Committee has delegated responsibility, from the
Audit Committee, for formally identifying and assessing
these risks annually, measuring them against a deined set
of criteria, and considering the likelihood of occurrence
and potential impact to the Group. The Group Risk and
Compliance Committee is formed of the Executive Board,
the Head of Internal Audit and Risk and risk owning Senior
Leadership Team members.
Risk management plays an integral part in the Group’s
planning, decision making and management processes. All
colleagues have a responsibility to ensure they understand
the risks in their area of activity and that they implement
and operate eective controls to manage the risks.
The Group’s risk proile is reported to the Executive
Board for review and challenge, ahead of inal review
and approval by the Board. These principal risks are then
subject to Board discussion during the course of the year,
as appropriate. To drive continuous improvement across
the business, the Group Risk and Compliance Committee
monitors the suitability and adequacy of controls in place
and the ongoing status of action plans against key risks
quarterly, with a particular focus for those risks considered
to be outside of the Group’s risk appetite.
Principal risks and uncertainties
On the following pages are details of our principal risks and
uncertainties and the key mitigating activities in place to
address them. It is recognised that the Group is exposed to
risks wider than those listed. We disclose those we believe
are likely to have the greatest impact on our business
at this moment in time and which have been subject to
debate at recent Board or Audit Committee meetings.
How the Board manages risk
The Board and each of its delegated Committees operate
to a prescribed meeting agenda in order to ensure that all
relevant risks are identiied and addressed as appropriate.
Key management information is reviewed in order to
prescribe operating controls and performance monitoring
against the Company’s strategy and business plans.
The Non-Executive Directors have particular responsibility
for monitoring the inancial and operating performance,
to ensure that progress is being made towards our agreed
goals. The Board’s responsibilities also include assessing
the eectiveness of internal controls and the management
of risk.
The Board’s review of risk and controls
During the year, the Board considered all strategic matters,
received key performance information on operating,
inancial and compliance matters and reviewed the
results of corresponding controls and risk management.
The Board received from the Audit Committee and the
executive’s Group Risk and Compliance Committee timely
information and reports on all relevant aspects of risk
and corresponding controls. We reviewed all of our key
Company policies and ensured that all matters of internal
control received adequate Board scrutiny and debate. At
Board meetings, and informally via the Chair, all Directors
had the opportunity to raise matters of particular concern
to them. There were no unresolved concerns in the year.
There were no new emerging or principal risks in the
year conirmed by the Board and the Group Risk and
Compliance Committee. However, our supply chain
and economic vulnerability risks were deemed to have
escalated in the year and have an increased risk outlook
moving forwards. The principal causes of the escalated
risk outlook are the conlict resulting from Russia’s invasion
of Ukraine, which is likely to cause further supply issues in
the motor industry as well as global economic uncertainty
from concerns over potential escalations of the conlict. In
addition, the ongoing semiconductor shortage is expected
to continue to aect the used car retail supply chain owing
to the lack of supply of new vehicles in the market.
The COVID-19 pandemic has continued to impact the
business in the year, albeit much reduced from FY21,
which is included in our economic vulnerability risk.
With respect to climate change, the Group Risk and
Compliance Committee actively manages and monitors
climate change risk within the scope of its activities.
This forms part of the continued commitment by the
Board and the Committee to integrate the identiication
and ongoing management of climate risks with the
Company’s risk management processes set out in the
Group Risk Management Framework. The summary risk
and opportunity register in respect of climate change
has been set out in our TCFD disclosure on page 46. The
register sets out how our speciic climate risks relate to the
principal risks. All of our climate change risks identiied are
being managed within the scope of our principal risks set
out on pages 61 to 65.
1st line
Operational and
management controls
• Site management with appropriate
team structure and dedicated
leadership team reporting line.
• Visible, championed values
and expected behaviours.
• Application of Company policies
andprocedures.
• Employee induction, training
and ongoing support.
• Executive and leadership
team oversight.
2nd line
Risk and compliance
monitoring
• Compliance and Data Protection
Oicers.
• Operational audit activity.
• Risk management framework.
• External specialists engaged
to monitor and report on
compliance operations.
3rd line
Independent and
externalreview
• External advisors engaged
to review1st and 2nd lines.
• Open culture of challenge
to existingprocesses and
whistleblowing hotline.
• The work of internal audit.
We concluded that appropriate controls are in place and
functioning eectively. The Board considers that the
Group’s systems provide information which is adequate
to permit the identiication of key risks to its business
and the proper assessment and mitigation of those risks.
Based on the work of the Audit and Risk and Compliance
committees, the Board has performed a robust assessment
to ensure that: (i) the principal risks and uncertainties
facing the Group’s business have been identiied and
assessed and are aligned to the Group’s business
strategies; and (ii) appropriate mitigation is in place.
Changes to principal risks
During FY22 the Group Risk and Compliance Committee
and the Board continued with its role of managing the
Group principal risks and where outside of appetite,
setting out and monitoring mitigations to bring the
risks within appetite.
We decided to remove Brexit from the principal risks
and uncertainties this year as a result of successful risk
mitigations and limited sourcing and sales activity with the
EU. The Board recognises that some residual uncertainties
in relation to Brexit remain, such as potential labour
shortages aecting the supply chain. However, these have
been included within the scope of our supply chain and
economic vulnerability risks with mitigations for those
uncertainties managed on a day to day basis.
Strategic Report Governance Financial Statements
6160
Motorpoint Group Plc
Annual Report and Accounts 2022
Viability statement
In accordance with the UK Corporate Governance Code
2018, the Board has assessed the prospects of the Group
over a period in excess of the 12 months required by the
‘Going Concern’ provision, selecting a three-year period
to the end of FY25 which takes into account the Group’s
current position and the potential impact of the principal
risks and uncertainties as set out on pages 61 to 65.
In making their assessment the Directors considered
the Group’s current balance sheet, and operational cash
lows, the availability of facilities, and stress testing of
the key trading assumptions within the Group’s plan.
The Board has taken a severe but plausible downside
scenario approach in considering the going concern
status of the Group, reducing volumes and prices, and
increasing interest rates and comparing with headroom
available against banking covenants and liquid resources
required to continue trading. Taking the base case three-
year forecast as the starting point, even when applying
a 25% reduction to revenue, as well as a substantial
increase in interest costs, the covenants were not
breached, and liquid resources were not depleted. In
this model, operating costs were not lexed outside of
built in inlationary increases. However, in the event of
a signiicant downturn, the Board would take mitigating
measures to reduce operating costs which would create
furtherheadroom.
The selection of the assumptions for the stressed budget
is inherently subjective, and whilst the Board considered
these assumptions to relect a severe but plausible
downside scenario, the future impact of economic
downturn, interest rate rises or inlating overhead
costsisimpossible to predict with absolute accuracy.
The eects of the pandemic in respect of restrictions,
lockdowns and mandatory isolation periods have
signiicantly reduced year on year and are increasingly
likely not to return. As such the Board anticipates that the
likelihood of material impacts on operations as the result
of the pandemic are less likely for FY23 and beyond. The
Board does acknowledge that there are potential future
direct and indirect implications of the pandemic, which
could continue to impact on the Group, including on its
liquidity and adherence to inancial covenants but these
are highly unlikely.
Scenario modelling has been considered throughout
the year and at year end by management to formulate
response options against moderate or severe downturns
in sales volumes, potential margin pressures and
possible cost challenges.
During FY22, the Group demonstrated its ability to
respond to market conditions and vehicle price inlation
by successfully increasing its stocking facilities, which
now stand at £195.0m up from £106.0m in FY21.
In addition, the revolving credit facility was increased
to £29.0m from £14.0m in FY21. The Group also has
an uncommitted overdraft facility of £6.0m which
remains in place and was undrawn at the year end. Both
are agreed until May 2024. Although this termination
falls within the period to 31 March 2025, the Group is
conident that any extension of the facilities can be
reasonably expected.
In the eventuality of a period of prolonged economic
downturn resulting in material reductions in sales volume
or prices as well as rising overhead costs, it is possible
that the Group would need to negotiate changes to
its current banking covenants, but such an extreme
downturn is not currently considered plausible.
The Group continues to consider and monitor further
potential mitigation actions it could take to strengthen its
cash position and reduce operating costs in the event of
a more severe downside scenario. Such cost reduction
and cash preservation actions would include but are
not limited to: reducing spend on speciic variable cost
lines including marketing and branch trading expenses;
team costs, most notably sales commissions; pausing
new stock commitments; and extending the period for
which expansionary capital spend, dividends and share
buybacks are suspended.
The Group has continued to demonstrate an
exceptionally lexible approach to trading and despite
the ongoing constriction in the supply of new vehicles,
which is expected to continue into 2023, we have been
able to use our market position to access more stock to
satisfy customer demand, both online and in branch.
The Directors have also made use of the post year
end trading performance to provide additional
assurance that the year end stock levels and associated
provisioning were reasonable, and that it is reasonable
that no branches require an impairment provision.
While only a short period has passed since the year end,
this evidence adds further comfort to the continuing
strength of the Group in an active market.
Based on this assessment, the Board conirms it has a
reasonable expectation that the Group will be able to
continue in operation and meet its liabilities as they
fall due over the period to 31 March 2025.
The Board has determined that the three-year period
constitutes an appropriate period over which to provide
its Viability Statement. This is the period detailed in our
Strategic Plan which we approve each year as part of
the strategic review. Whilst the Board has no reason to
believe the Group will not be viable over a longer period,
given the inherent uncertainty involved we believe this
presents users of the Annual Report and Accounts with
a reasonable degree of conidence while still providing
a medium term perspective.
Principal risks and uncertainties
Risk and impact Mitigating controls Progress made in FY22
Dynamic Risk
Assessment
Competition, Market and Customers
The UK vehicle market is highly
competitive, and customers
have a broad choice of retailers,
some of which oer comparable
products. The market continues
to see consolidation and
innovation, through which our
competitors have progressed
theirpropositions.
Concurrently, customer
expectations and buying
patterns are evolving, with
the traditional research and
purchase channels becoming
ever more inluenced by digital
media, peer recommendations
and convenience. There is also a
market risk identiied in respect
of climate change aecting
consumer choice.
Failing to stay ahead of the market
or to adapt to changing customer
behaviours faster than the
competition could undermine
our ability to meet our objectives.
• Continue to drive our multichannel proposition,
reined post COVID-19 to accelerate growth
opportunities.
• Continue to compete via our business model’s
consistent focus on Choice, Value, Service and
Quality; each of these cornerstones is built
into the business operation and reporting. For
example, customer satisfaction ratings are used
in the calculation of all bonuses or commissions
across the business.
• Investment in brand marketing, digital
engineering, data insight capability and service
to raise awareness of Motorpoint and meet
customer needs, including with respect to
electric vehicles and climate change related data,
such as emissions produced by cars that are sold.
• Investment in supply chain capacity and
capability, and delivery of productivity
improvements to enable us to compete eectively
and allocate resource to growth driving activity.
• Commission regular customer insight reports
to track performance against the market,
competitors, and other key indicators.
Mystery shopping best in class retailers.
• Increasing our market share in
new areas through three new
sales sites in the year as well as a
new dedicated preparation centre.
• Signiicant investment in our
digital transformation, including
the appointment of a Head of
Change and Transformation to
enhance our digital oering.
• Increased brand awareness
through continued investment in
brand marketing and nationwide
TV advertising.
• Implementing a highly lexible
and adaptable business model
inresponse to increased demand
for used cars, increasing the
range of cars Motorpoint would
typically sell.
• Electric vehicle strategy formed
during the year, with in-put
from newly appointed Head of
Sustainability. Progress includes:
communications to employees
and customers; training for
employees; and dedicated areas
on the customer website for
electric vehicles.
Brand and Reputation
As a function of being
independent of manufacturer
support, Motorpoint attracts
new and repeat customers
substantially through building
a compelling perception of
the Company’s brand and
reputation. Our customers expect
us to deliver vehicles that are
safe, compliant with legal and
regulatory requirements, and it
for purpose.
We also recognise the potential
impact of climate change on
brand and reputation in the
knowledge that failure to embrace
change to combat climate
change could result in negative
consequences for our brand and
reputation.
Failure to maintain these would
rapidly result in a loss of customer
conidence and impact levels of
business.
Unfavourable publicity concerning
the Company or the industry in
which it operates could also have
an adverse impact.
• Brand awareness and relevance expanded to both
new and existing customers, through investment
in our website, advertising and via more
personalised outbound communications.
• Customer satisfaction, measured using the NPS
system, sits at the heart of our operations and is
subject to regular scrutiny across all levels of the
business.
• We closely monitor customer perceptions using
both qualitative and quantitative feedback and
respond quickly where possible.
• Customer Sentiment Dashboard monitors the
potential impact of climate change on brand and
reputation as well as other key metrics from NPS
score, review scores of sites and feedback and
social media sentiment.
• Key messaging around our
four core value propositions
– Choice, Value, Service
and Quality.
• Began to implement a
consolidated and formalised
Customer Sentiment Dashboard
that tracks on a monthly basis
customer metrics such as repeat
business levels, NPS scores,
review site scores and feedback,
and social media sentiment.
• Business Intelligence
restructured to interpret key
customer metrics and capitalise
on new opportunities.
• Head of Sustainability appointed
in line with the Company’s
ambition to achieve sustainable,
responsible operations,
including working with the
ESG Committee on the topic of
climate change and how it may
aect our brand and reputation.
Increasing Decreasing Stable
Dynamic Risk Assessment
Risk management continued
Strategic Report Governance Financial Statements
6362
Motorpoint Group Plc
Annual Report and Accounts 2022
Risk and impact Mitigating controls Progress made in FY22
Dynamic Risk
Assessment
Availability and Terms of Customer Finance
Vehicle sales volumes rely on our
customers being able to access
aordable credit lines. As such
the Company is exposed to
the risk of lending institutions
reducing, terminating, or
materially altering the terms and
conditions on which they are
willing to oer consumer credit
to the Company’s customers.
Commission income generated
by the Company acting as a
regulated credit broker could be
impacted if either the number
of such arrangements reduces,
or the structure and amount of
commissions earned is altered.
Given the customer inance
oering has improved in the year
as well as continued positive
relationships with lenders, this
risk is deemed to be decreasing
in outlook.
• Constantly monitor the market and
emerging trends.
• Work in conjunction with our partners to keep
our consumer credit oer relevant, competitive
and viable.
• Where possible reinvest in the quality of the
customer oer, preferring to build its appeal
rather than maximise our commission rates.
• Customer inance oering
improved in the year through
the reduction of rates available
to customers.
Supply Chain Disruption
Sales/proitability and customer
satisfaction could be impacted by
supply chain disruption or loss of
access to key suppliers.
This includes potential eects
from increased risks in this area
such as the situation in Ukraine,
which is likely to further aect
supply in the motor trade, as well
as the ongoing semiconductor
issue.
Potential long term threats in this
area from climate related risks are
also included within the scope of
this risk.
• Use of a broad spread of supply channels, within
each of which are longstanding relationships.
• Employment of an experienced buying team
which is responsible for maintaining an eicient
and eective supply chain.
• Able to utilise our buying criteria within the scope
of our retail proposition (age and mileage of
vehicles) to access more supply if required.
• Business continuity plans in place for Motorpoint
non-store facilities.
• We seek to limit dependency on individual
suppliers by actively managing key supplier
relationships.
• Head of Sustainability reporting on ways in which
the supply chain can be made more sustainable,
in order to combat long term climate related risks
in this area.
• Continuation of upgraded
Home Delivery vehicle leet.
• New car buying service
introduced, which broadens
our supply channels.
• Strengthened and consolidated
our relationship with key
subcontractors in our supply
chain, including the agreement
of multiple contracts covering
all branches.
• Investigative work undertaken to
develop the sustainability of our
supply chain.
Increasing Decreasing Stable
Dynamic Risk Assessment
Risk and impact Mitigating controls Progress made in FY22
Dynamic Risk
Assessment
Economic Vulnerability
Failure to withstand the impact of
an event or combination of events
that signiicantly disrupts all or
a substantial part of the Group’s
sales or operations.
This risk includes the risk of a lack
of business resilience in the event
of: external economic pressures
and inlation causing signiicant
reduction in UK Consumer
spending, further risks of
economic shutdowns from a new
or resurgent pandemic, economic
downturn due to global conlict
causing material price rises and
energy price increases, climate
related disruption, and material
cost inlation.
• Internal control and risk management process
in place to identify and manage risks (including
emerging risks) that may impact the business.
This includes horizon scanning for potential risks
and early identiication of mitigations against
potential rising costs, falling sales volumes and
business readiness in the event of shutdowns.
• Conservative inancial approach – strong balance
sheet, balanced levels of structural debt, low risk
property portfolio, ‘value for money’ mentality.
• Strong and united Board and Management team
in place, experienced managers in key roles and
committed colleagues.
• Strong values – emphasising ’long term thinking’
and ‘acting like owners’ – which Board and
senior management are required to role model,
embedded in the business through recruitment
and appraisal, and colleague communications.
• Strong relationships maintained with key
stakeholders (shareholders, colleagues,
customers, suppliers, community).
• Investment in the Motorpoint brand and diversity
of routes to market provide lexibility through our
omnichannel approach.
• Business continuity plans in place and kept up
to date for branches, operations and technology.
• Forward planning by ESG Committee and Head of
Sustainability to plan for potential climate related
economic threats from increasing cost of carbon.
• Insurance cover in place to cover key risks,
where applicable. Particular focus on cash
low management.
• Expert third party advisers in place (e.g.,
corporate PR, corporate, banking, legal) to assist.
• Further strengthening inancial
position of the Group through
increased stocking facilities
and revolving credit facility.
• Adaptable business model in
place facilitating colleagues to
work remotely where possible
and contingency plans to close/
reopen branches and facilities
safely in accordance with legal
requirements.
• Long term planning and
investigative work begun
covering the business’ readiness
for the impacts of climate
change, including an anticipated
increased demand for electric
and alternately fuelled vehicles.
Finance and Treasury
Growth constrained by lack
of access to capital/ inancial
resource.
• Motorpoint uses a selection of inance facilities
to fund its operations including a stock inancing
facility secured against its retail vehicle stocks.
• The Group has an uncommitted £6.0m overdraft
and a £29.0m Revolving Credit Facility in place
until May 2024.
• A treasury policy and set of processes are in
place to govern and control cash low activities,
including the investment of surplus cash.
• Hedging arrangements are in place for foreign
exchange transactions, and freight and energy
prices are agreed in advance, to help mitigate
volatility and aid margin management.
• Forward looking cash low forecasts and covenant
tests are prepared to ensure that suicient liquidity
and covenant headroom exists.
• Actions continue to improve
controls around stock and cash
management, including controls
around stock purchasing and
forecasting.
• Further strengthening inancial
position of the Group through
increased stocking facilities
and revolving credit facility.
Principal risks and uncertainties continued
Strategic Report Governance Financial Statements
6564
Motorpoint Group Plc
Annual Report and Accounts 2022
Risk and impact Mitigating controls Progress made in FY22
Dynamic Risk
Assessment
IT Systems, Data and Cyber Security
Operations impacted by failure
to develop technology to support
the strategy, lack of availability
due to cyber attack or other
failure, and reputational damage/
ines due to loss of personal data.
• Formal IT governance processes in place to
cover all aspects of IT management.
• Changes to IT services are managed through
a combination of formal programmes for large
and complex programmes, or bespoke iterative
development methodologies for smaller scale
changes.
• A detailed IT development and security roadmap
is in place, aligned to strategy.
• Comprehensive third party support in place for
relevant technologies.
• Business continuity in place for all major systems
and applications.
• Regular vulnerability scans, annual penetration
testing with systematic methodology to treat
identiied threats.
• Business process, authorisation controls and
access to sensitive transactions are kept
under review.
• Signiicant investment in digital
transformation is underway,
upgrading and replacing legacy
systems.
• Ongoing actions in respect of
network refresh programme,
hardware refresh programme
and strengthening our change
management controls.
• Strengthened, renewed and
thoroughly socialised data
protection policy.
Regulatory and Compliance
Fines, damages claims, and
reputational damage could be
incurred if we fail to comply
with legislative or regulatory
requirements, including
consumer law, health and safety,
employment law, GDPR and data
protection and the Bribery Act.
The Company also has various FCA
permissions to carry on a range of
regulated insurance and consumer
credit activities from which it
derives income. There is a risk that
increased regulation or restrictions
on the sales process or nature of
these products would restrict the
income available to the Company.
• Operational management are responsible
for liaising with the Company Secretary and
external advisers to ensure that new legislation
is identiied, and relevant action taken.
• Training on the requirements of the Bribery
Act and anti money laundering policies are
in place for all relevant colleagues and
policies are communicated to all suppliers.
• Whistleblowing procedure and independently
administered helpline which enables colleagues
to raise concerns in conidence.
• Expanded and renamed
‘Group Risk and Compliance
Committee’ ensuring robust
regular oversight and review
of compliance matters by the
SLT. Continued to conduct
horizon scanning processes to
identify changes in regulatory
expectations.
• Strengthened, renewed and
thoroughly socialised data
protection policy.
Increasing Decreasing Stable
Dynamic Risk Assessment
Risk and impact Mitigating controls Progress made in FY22
Dynamic Risk
Assessment
People and Culture
The success of the business could
be impacted if it fails to attract,
retain and motivate high calibre
colleagues.
Maintaining and evolving the
culture of our business (embodied
in our shared values) is essential
to delivering our strategy
and ensuring the long term
sustainability of our business.
• The composition of the Executive team is
regularly reviewed by the Board to ensure that
it is appropriate to deliver the growth plans of
the business.
• Succession plans and appraisals are in place
across the Group.
• Shared values describe and embed our culture.
• The Group’s Remuneration Policy detailed in this
report is designed to ensure that high calibre
executives are attracted and retained. Lock in
of senior management is supported by awards
under the Long Term Incentive Plan.
• Mark Carpenter, CEO, appointed
as a patron of the ‘Automotive
30% Club’ which focuses on
improving gender balance and
diversity and inclusion in the
motor industry.
• Further discount oered this year
(20%) for the annual Sharescheme
programme to all employees.
• Increased Group Board focus
on Board and Executive
team succession and talent
management.
• Materiality assessment conducted
by Bright Space Communications
concluding on key environmental,
social and governance themes
considered most important by our
employees, wider industry trends
and global matters.
• Actions in respect of organisational
design review are continuing.
Health, Safety and Welfare
The risk that accidents, hazards
or incidents are caused by unsafe
practices at work, resulting in
injury or death to customers,
employees or third parties.
• Health and safety training for all new starters,
with additional role speciic training for
employees in branches.
• Implemented incident management processing
to ensure major incidents are dealt with
appropriately and problems are logged
and actively progressed to resolution.
• Undertake risk and control assessments to
monitor compliance.
• Continually monitor our mandatory regulatory
training to ensure that all colleagues are kept
informed.
• Ensure that incident reporting including lessons
learnt exercises take place to meet health and
safety obligations.
• Incidents are reported online, via a reporting
tool. Line management deal with minor incidents.
Major incidents are escalated to the Senior
Leadership Team who are supported by PIB
Risk Management (‘PIB’).
• Risk assessment is managed in the following
ways:
– line management on the branches have a
number of online risk assessment checklists
to verify the relevant controls are in place; and
– higher level risk assessments are carried out on
workshop activities by PIB including Hand Arm
Vibration and Control of Substances Hazardous
to Health. The Group Compliance Manager
also carries out higher level risk assessments
covering branch transport safety, gates and
barriers as well as ire risk assessment.
• Ongoing actions from six
monthly insurance inspections
of the Lifting Operations and
Lifting Equipment Regulations
and periodic inspection and
maintenance under Provision
and Use of Work Equipment
Regulations.
• Ongoing actions from incident
reporting included within
monthly Board submissions and
also discussed within monthly
Operations Manager Health and
Safety Governance including
deep dive into causations, issues
arising/lessons learnt and best
it solutions.
• Ongoing actions from
strengthened and enhanced
Fire Risk Assessment conducted
across all branches in FY22.
Principal risks and uncertainties continued
Financial Statements
6766
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Non-inancial information statement
In accordance with section 414CB of the Companies Act 2006, the sections cross referred to in the table below are
incorporated into this non-inancial information statement.
Environmental matters
Stakeholder engagement:
community andenvironment
Read more / page 34
Streamlined Energy and
Carbon Reporting
Read more / page 39
Energy eiciency actions
Read more / page 37
Going green
Read more / page 36
As part of this year’s SECR, we have established an
Environment Social and Governance Committee.
In addition our talent team are working on business
projects focused on improving the sustainability of
the business and our impact on the environment.
Related principal risk: Brand
and Reputation; Regulatory
and Compliance
Read more / pages
61, 64
Company’s employees
At a glance
Read more / page 48
Our operating model begins
with our team
Read more / page 2
Our Core values
Read more / page 48
Our Stakeholders
Read more / page 32
Winning Culture
Read more / page 47
Supporting employee wellbeing
Read more / page 52
The Company has various employee centric policies and
guidance including: Sta Handbook; HR Policies including
equal opportunities; anti bullying and harassment;
whistleblowing; enhanced maternity leave; paternity leave;
health, safety and welfare; data protection; and privacy.
Related principal risk: People
and Culture; IT Systems, Data,
andCyberSecurity
Read more / pages
64, 65
Social matters
Investing in our communities
Read more / page 50
Supporting great causes
Read more / page 50
Anti corruption and anti bribery
matters
Read more / page 53
Related principal risk: Brand and
Reputation; Economic Vulnerability;
Regulatory and Compliance
Read more / pages 61,
63, 64
Respect for human rights
Real living wage
Read more / page 19
Modern slavery
Read more / page 53
Treating customers fairly
Read more / page 53
Related principal risk: Brand
and Reputation; Regulatory and
Compliance People and Culture
Read more / pages 61,
64, 65
Anti corruption and anti bribery matters
Whistleblowing hotline,
anti corruption and anti bribery
Read more / page 53
Related principal risk:
Regulatory and Compliance
Read more / page 64
Investment case
Read more / page 3
Non-inancial KPIs
Read more / page 23
Business model
Read more / pages
4, 5
Governance
68 Board of Directors
70 Introduction to governance
71 Corporate governance report
75 Audit Committee report
79 Nomination Committee report
82 Remuneration Committee report
84 Remuneration policy
91 Annual report on remuneration
99 Directors’ report
104 Statement of Directors’ responsibilities
Financial Statements
6968
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Chris Morgan
Chief Financial Oicer
January 2021
Chris was appointed Chief
Financial Oicer in January
2021. Chris was formerly group
inance director at Speedy
Hire Plc. Prior to this Chris
held senior inance leadership
positions at Go Outdoors and
Tesco, where he was latterly
the inance director for the
Czech Republic and Slovakia.
Chris is a Fellow of the Institute
of Chartered Accountants in
England and Wales.
None
Board of Directors
Experienced management
team delivering excellence.
Appointment
Background and career
External roles
John Walden
Independent Non-Executive
Chair and Chair of the
Nomination Committee
Mark Carpenter
Chief Executive Oicer
Committee
membership key
January 2022 April 2016
John has held prior roles
including chair of Naked Wines
plc, chair of the Jersey parent
company of Holland & Barrett
International, and non-executive
director of Celine Jersey Topco
Ltd, the Jersey holding company
of Debenhams. John was also
an executive director at FTD
Companies. John served as CEO
of Argos and its parent company
Home Retail Group plc, and he
has held several senior roles
with Best Buy Co. including EVP
and president of the internet
division. John has been a
driving force in omnichannel
and consumer driven retailing,
as well as leading digital and
transformational change, both
in the UK and US.
Mark was appointed as Chief
Executive Oicer in May 2013
following two years as CFO,
and has 18 years’ experience
in motor retail. Mark was
previously Finance Director
of Sytner Group Limited from
2005 to 2010. Prior to this,
Mark was with Andersen,
where he qualiied as a
CharteredAccountant.
Since March 2021, John has
been the chair of SnowFox
Topco Ltd, the Guernsey topco
responsible for Yo Sushi. John is
also a partner inInversion LLC.
Audit
Committee
Remuneration
Committee
Nomination
Committee
ESG
Committee
Committee
Chair
None
Mary McNamara
Senior Independent
Non-Executive Director
and Chair of the
Remuneration Committee
Adele Cooper
Independent Non-Executive
Director
Keith Mansield
Independent Non-Executive
Director and Chair of the
Audit Committee
May 2016 (appointed as Senior
Independent Director in
October 2016)
March 2020 May 2020
Mary was CEO of the
commercial division and
board director of the Banking
Division at Close Brothers
Group Plc. She spent 17
years with GE in a number
of leadership roles, including
CEO of the European Fleet
Services business. Mary has
also spent time with Skandia
and 14 years at Harrods.
Adele has extensive marketing
and senior leadership
experience, having worked at
some of the world’s leading
technology companies, most
recently at Pinterest from
June 2015 to December 2019.
While at Pinterest, Adele was
responsible for the UK and
Ireland, overseeing strategic,
commercial and operational
management. Prior to this,
Adele has been with Facebook
and Google in a lead global
relationship role and a variety
of regional and global lead roles
in marketing and operations.
Keith was appointed to the
Board of Motorpoint Group
Plc as Independent Non-
Executive Director in May
2020. A Chartered Accountant
by background, Keith brings
extensive accountancy
experience, having worked
at PwC for over 30 years,
during which time he served
as Chair of PwC in London
responsible for assurance, tax
and advisory services. As a
partner for 22 years, he has led
services to public and private
companies across a range of
industrysectors.
Chair of the remuneration
committee and member of the
nomination and governance
committee of OSB Group plc.
Adele is Chief Revenue Oicer
at &Open and also a non-
executive director of Conjura
IrelandLimited.
Keith is the senior independent
director of Tritax Eurobox
plc, where he chairs the
audit committee and is a
member of the management
engagement committee and
nomination committee. Keith
is also the senior independent
director and chair of the
audit committee of Digital
9 Infrastructure plc, and
Chair of Albemarle Fairoaks
AirportLimited.
Appointment
Background and career
External roles
Financial Statements
7170
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Introduction to governance
Chair’s introduction
Dear Shareholder
I am delighted to present my irst
Corporate Governance review for
Motorpoint. The aim of this report is
to explain Motorpoint’s governance
framework and outline how it was
applied on a practical basis in the
year under review – a year that has
continued to be hugely challenging
due to the COVID-19 pandemic
and one that has required great
adaptability, resourcefulness and
governance strength in depth.
The Board’s role in setting the
Group’s culture and core values is a
signiicant one, and understanding
the work being undertaken in this
area has been a priority for me
since being appointed. I have had
in depth conversations with Mark
Carpenter and the rest of the Board to
understand how all Board members
have given their time to supporting
the management team, in various
capacities, across the last year and
formulating our plans for continuing
to do so in FY23. FY22 has shown that
this best enables a culture across
the Group of agile decision making
and speed of reaction to events,
whilst maintaining the innovative
drive that has been the hallmark of
Motorpoint’s success to date. I am
very proud of the work which has
been carried out throughout FY22
on employee wellbeing and the top
down engagement with sta, which
will ultimately lead to a better, more
open working environment.
As a Board, we are conscious
that we are accountable to all our
shareholders and must have regard
to other stakeholders such as
employees, customers, suppliers
and the environment. We maintain
an active dialogue with shareholders
throughout the year and listen to
views of representatives of investors
and inancial institutions. We also
welcome the opportunity to answer
shareholders’ questions at our 2022
Annual General Meeting (‘AGM’).
Board meetings have continued to
be conducted in a hybrid format.
This format has allowed for greater
lexibility, and we will continue to
operate in this way in the comingyear.
ESG
We are committed to an ESG
agenda which aims to exceed our
stakeholders’ expectations. The past
year has accelerated expectations for
all companies to make good progress
in this area, and to support our work
in this area we have formed an ESG
Committee to develop, implement
and monitor our ESG strategy.
This committee will also be
responsible for overseeing and
supporting stakeholder engagement
on ESGmatters.
Board changes
The only change to the Board over the
past year relates to my appointment
as Chair on 10 January 2022, following
the retirement of MarkMorris.
Biographies for each of the current
Directors are set out on pages
68 and 69. The progress in talent
development and diversity can be
found on page 80.
Compliance statements
Throughout the year ended 31 March
2022, the Company has complied
with the provisions as set out in the
2018 Corporate Governance Code
(the ‘2018 Code’) (a copy of which is
available on the Financial Reporting
Council’s website at www.frc.org.uk)
inall respects.
Our eectiveness
Every year we perform a review of
the eectiveness of the Board. The
indings show that the work we do
as a Board and in our committees
continues to be eective. Our review
also conirmed that our focus in the
coming year should continue to be
on strategy, stakeholder engagement
and ensuring strong, consistent
governance practices.
Board priorities
Our priorities for next year are very
much focused around building rapid
but sustainable growth in the Group
and delivering on our strategic plan
with a strong governance underpin.
John Walden
Chair
15 June 2022
Corporate governance report
Board leadership
and purpose
The role of the Board
The Board sets the Company’s
strategic aims and ensures that the
necessary resources are in place
to allow the Company’s objectives
to be met, in a way that enables
sustainable long term growth. It is also
responsible for corporate governance
and the overall inancial performance
of the Group. The Board establishes
the Company’s culture, values and
ethics and it is important that the
correct ‘tone from the top’ is set, with
all Directors being required to devote
suicient time to their role.
The current Board composition
is the Chair, three independent
Non-Executive Directors and
two Executive Directors.
Roles and responsibilities
The Chair’s role
The Chair’s primary role is the
leadership of the Board. He ensures
that the Directors receive accurate,
timely and clear information and
is responsible for cultivating a
boardroom culture of honesty and
openness which encourages debate,
challenge where appropriate, and
enables the Non-Executive Directors
to make an eective contribution.
The Chair sets the Board’s agenda and
ensures suicient time is allocated for
the discussion of all agenda items.
The Chair also consults with the
Non-Executive Directors, in particular
the Senior Independent Director, on
matters of corporate governance and
ensures all Directors are made aware
of any major shareholders’ issues and
concerns.
The Board is satisied that the Chair
fulils his responsibilities of enabling
the Board to make sound decisions.
Chief Executive Oicer’s role
The Chief Executive Oicer (‘CEO’) is
responsible for the day to day running
of the Group’s business and includes
the development and implementation
of strategy and of decisions made by
the Board as well as the operational
management of the Group.
Chief Financial Oicer’s role
The Chief Financial Oicer (‘CFO’) is
responsible for the Group’s inancial
activities, including control, planning
and reporting, and also contributes
to the broader management of the
Group’s business. The CFO supports
the CEO with the development,
implementation and tracking of
the Group’s strategy. Chris Morgan
is also the Company Secretary.
The Executive Directors (being the
CEO and the CFO) attend committee
meetings by invitation of the
committee chair where appropriate.
Senior Independent Director’s
role
The Senior Independent Director
– currently Mary McNamara – acts
as a sounding board to the Chair
and serves as an intermediary for
the other Directors when necessary.
The Senior Independent Director is
available to shareholders to assist
with addressing concerns that may
arise and meets with the other Non-
Executive Directors (excluding the
Chair) at least once a year to review
the performance of the Chair. This
year, in compliance with the 2018
Code, Mary McNamara served as
Acting Chair of the Nomination
Committee when the decision to
recommend the successor to the
incumbent Chair of the Board and
of the Nomination Committee
wasmade.
The Senior Independent Director also
typically meets with Non-Executive
Directors without the Chair present
at least annually and conducts
the annual appraisal of the Chair’s
performance and provides feedback
to the Chair on the outputs of that
appraisal. Because our new Chair,
John Walden, was appointed in the
fourth quarter with little opportunity
for feedback, this appraisal was not
conducted in FY22. However, all
Directors have the ability to raise any
relevant views which they have with
the Senior Independent Director if
they feel this is warranted.
Independent Non-Executive
Directors
The Non-Executive Directors bring
independence, along with a broad
mix of business skills, knowledge
and experience to the Board. They
provide an external perspective
to Board discussions and are
responsible for the scrutiny of the
executive management on behalf
of shareholders. The Non-Executive
Directors constructively challenge
Board discussions and help develop
proposals on strategy. At least
annually, the independent Directors
meet without the presence of the
Executive Directors.
The Board assessed its Chair,
John Walden, as independent
on appointment. John has no
prior history with the Company
and following an independence
assessment prior to his nomination,
the Board conirmed his
independence.
Non-Executive Directors monitor the
reporting of performance and ensure
that the Company is operating within
the governance and risk framework
approved by the Board.
Financial Statements
7372
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
The Company Secretary’s role
The Company Secretary ensures
that eective communication
lows between the Board and its
committees and between senior
management and the Non-Executive
Directors. The Company Secretary
is responsible for ensuring that
the Board operates in accordance
with the Company’s corporate
governanceframework.
The appointment and removal of
the Company Secretary is a matter
for the whole Board.
Matters reserved for the Board
In order to retain control of key
decisions and ensure that there
is a clear division of responsibility
between the Board and the day to day
running of the business, the Board
has a formal schedule of matters
reserved for its decision. These
reserved matters include inancial
reporting, investment appraisal and
risk management. The matters were
reviewed by the Board during 2020
to ensure they were aligned with
the 2018 Code, and will be reviewed
again in July 2022.
Board committees
The Board operates several
committees to support it in carrying
out its duties. Further information
about the work carried out by these
committees can be found on the
following pages:
• Audit Committee (p.75)
• Nominations Committee (p.79)
• Remuneration Committee (p.82)
Board focus during the year
The Board holds a number of
scheduled meetings each year,
including a strategy day which is
usually held o site. Most meetings
in FY22 were held via teleconference
due to the COVID-19 pandemic,
however where permitted, the
Company did hold some in
person this year.
Key areas of focus during the
year were:
Strategy
• In April 2021, the Board adopted
a new strategic plan prompted
by the rapid change in the car
retail environment which included
a changing landscape of how
customers choose to buy cars.
The Board reviewed progress
against this plan regularly
during the course of the year
• Investor relations and
communications
• Strategic growth opportunities
such as the opening of new
branches, technology and
marketing investment, eiciencies
and exploration of other growth
opportunities
Financial
• Approved the full year results
announcement and the Annual
Report for the 2021 inancial year.
In doing so, the Board considers
that the Annual Report, taken
as a whole, is fair, balanced and
understandable, and provides
the information necessary for
shareholders to assess the
group’s and company’s position,
performance, business model and
strategy
• Continued suspension of the
payment of any dividends
• Renewal and increase in stock
inancing and banking facilities
with Lombard, Black Horse
and Santander
• Budget for FY23
• Half year results, full year
results and trading updates
• Review of Group cash
position and forecasting
• Monthly performance
reporting and review
Internal control and
risk management
• Performed the annual review
of the eectiveness of internal
control, risk identiication
and mitigation
• Carried out a robust assessment
of the emerging and principal
risks facing the Group. Further
information on these principal
risks, the procedures in place to
identify emerging risks and how
these are being managed or
mitigated can be found on pages
61 to 65
• Approved the Viability Statement
as disclosed in the Annual Report
2021, which sets out that the
Group will be able to continue in
operation and meet its liabilities
as they fall due over the next
three years
• Through the Audit Committee,
considered and approved the
adoption of the going concern
basis of accounting in preparing
the half and full year results
• Through the Audit Committee,
made an assessment of the
Group’s prospects over a
three-year period
• Through the Audit Committee,
the Company’s irst in house Head
of Internal Audit and Risk was
appointed in November 2021
• Through the Audit Committee,
approved a new related parties
transactions policy and process
Corporate governance report continued
People, talent and culture
• Appointment of a new
Non-Executive Chair and Chair
of the Nomination Committee
• Succession planning and talent
development for all senior roles
• Reviewed the results of the
engagement survey
• Considered general employee
wellness in light of the pandemic
• Ensured safe and comfortable
working environments
• Reviewed and approved
amendments to the Company’s
all employee share plans
(Sharesave; SIP)
• Through the Remuneration
Committee, approved an
increased discount (to the HMRC
maximum of 20%) of the option
price under the Company’s HMRC
approved Sharesave scheme
open to all employees
Governance, compliance
and ethics
• Approved AGM business such
as the Notice of Meeting and
related ancillaries
• Reviewed the internal Board
evaluation process
• Assessed the independence
of all Directors
• Through the Remuneration
Committee, introduced policies
on the granting and vesting of
equity awards and on bonuses
• Began the process of establishing
an ESG Committee
• Approved the Modern Slavery
Act statement, available on
the Company’s website
www.motorpointplc.com
Board independence
and appointment terms
The Board has reviewed the
independence of each Non-Executive
Director and considers each of them
to be independent of management
and free from business or other
relationships that could interfere
with the exercise of independent
judgement. The Company meets
the requirement under Provision 11
of the 2018 Code that at least half
of the Board, excluding the Chair, are
Non-Executive Directors whom the
Board considers to be independent.
The Board believes that any shares
in the Company held personally by
a member of the Board serves to
align their interests with those of
the shareholders.
The former chair, Mark Morris,
and the CEO, Mark Carpenter,
own approximately 9.6% and 9.8%
respectively of the shares of the
Company. Both Mark Morris and Mark
Carpenter were considered by their
fellow Directors to be independent
in character and judgement in
performing their respective duties
during the periods of their tenure
in the year. Mark Morris is no longer
on the Board, but the Board is fully
conident that, in the very unlikely
event of a conlict emerging between
Mark Carpenter’s duties as a Director
and his interests as a shareholder, he
would absent himself from the Board
discussions in question (and the
Board would ensure that he does so).
The terms and conditions of
appointment of the Non-Executive
Directors are contained within their
Letters of Appointment. The terms
of appointment for the Directors
conirm they are expected to devote
such time as necessary for the
proper performance of their duties.
The Board reviews and approves as
necessary any additional external
appointments the Directors may
look to obtain.
The CEO and CFO do not currently
have a non-executive directorship
on any other listed company board.
Board meetings
The Board met regularly to discharge
its duties eectively and held
additional conference calls between
the scheduled meetings as and when
circumstances required. Directors
are provided with meeting papers
approximately one week in advance
of each Board or committee meeting.
Members of the Senior Leadership
Team are regularly invited to attend
Board meetings to present on their
speciic area of responsibility.
Board and committee attendance FY22
The Board has regular scheduled meetings throughout the year. Directors’
attendance at Board and committee meetings during the year is outlined below:
Director
Board (14
meetings)
Audit
Committee (3)
Nomination
Committee (4)
Remuneration
Committee (4)
Mark Carpenter 14 – 4 –
Chris Morgan 14 – – –
Mark Morris (resigned
10 January 2022) 11/11 – 4 –
John Walden (appointed
10 January 2022) 3/3 – – –
Mary McNamara 14 3 4 4
Keith Mansield 14 3 4 4
Adele Cooper 14 3 4 4
Financial Statements
7574
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Annual General Meeting
The 2022 AGM will be held on 27 July
2022. Based on current guidelines
issued by the UK Government it will
be possible to hold this year’s AGM
in person, with shareholders present.
However, given the constantly
evolving nature of the situation in
relation to the COVID-19 pandemic,
shareholders are strongly encouraged
to appoint the Chair of the meeting
as their proxy and submit their voting
instructions electronically in advance
of the Meeting.
The Notice convening the 2022 AGM
will be circulated to shareholders
separately, along with details on how
shareholders can still raise questions
to the Board in advance and follow
the proceedings of the AGM remotely.
We will ensure that shareholders are
kept informed using the Notice of
Meeting, our website, and relevant
regulatory announcements in
duecourse.
Conlicts of interest
The Company’s Articles of
Association, in line with the
Companies Act 2006, allow the Board
to authorise any potential conlicts
of interest that may arise and impose
limits or conditions as appropriate.
The Board has a formal process for
the Directors to disclose any conlicts
of interest and any decision of the
Board to authorise a conlict of
interest is only eective if it is agreed
without the conlicted Director(s)
voting or without their votes being
counted. In making such a decision,
the Directors must act in a way they
consider in good faith will be most
likely to promote the success of the
Group.
Independent advice
The Directors may take independent
professional advice, if necessary,
at the Company’s expense.
Board training and development
Directors are continually updated
on the Group’s business, the markets
in which we operate and changes
to the competitive and regulatory
environments through presentations
and brieings to the Board from
Executive Directors and the Senior
Leadership Team.
Directors received brieings from
the Company Secretary during the
year on governance and compliance
matters and relevant legislative
changes.
Relations with shareholders
All shareholders have access to
the Chair and the Senior Non-
Executive Independent Director,
who are available to discuss any
questions which shareholders may
have in relation to the running of
the Company.
The Board recognises the need
to ensure that all Directors are
fully aware of the views of major
shareholders. Copies of all analysts’
research relating to the Company
are circulated to Directors upon
publication. The Company receives
a monthly Investor Relations report
which includes an analysis of the
Company’s shareholder register.
John Walden
Chair
15 June 2022
Corporate governance report continued
Composition of the Board
INED
Executive 2
4
INED/Executive split
Male
Female 2
4
Male/Female Split
Audit Committee report
Audit Committee
Chair’s Statement
Dear Shareholder
I am pleased to present the report
of the Audit Committee (the
‘Committee’) for FY22. The principal
purpose of this report is to look
back over the inancial year ended
31 March 2022 and describe the
Committee’s responsibilities and
activities during the year.
The Committee fulils an important
oversight role, monitoring the
eectiveness of the Group’s
system ofinternal control and
risk management framework and
reviewing the integrity of the Group’s
inancial reporting. The principal
role of the Committee is to assist
the Board in fulilling its oversight
responsibilities in relation to inancial
reporting and inancialcontrols.
As Chair of the Committee, my
principal objective is to ensure the
soundness and eectiveness of the
Group’s systems and controls. Risk
management and internal control
continues to be a priority topic for
the Group, ensuring Motorpoint
can respond with pace and robustly
to economic uncertainty and the
residual eects of the pandemic. Risk
management processes have been
further strengthened in the year and
the internal audit function has been
successfully expanded, representing
the achievement of key objectives in
respect of risk and internal control for
the Group.
We are aware of the
recommendations made by
Lord Brydon in his report of the
independent review into the quality
and eectiveness of audit’ and
continue to monitor developments
in relation to the proposed Audit,
Reporting and Governance Authority
(‘ARGA’). Our future assurance plans
embrace these recommendations
and include formalising our irst audit
and assurance policy, which will set
out our three-year strategy over audit
and assurance for the Group. The
new policy is currently in the planning
phase and is set to be reviewed by
the Audit Committee in FY23.
Risk management and internal control continues to be a priority topic for the
Group, ensuring Motorpoint can respond with pace and robustly to economic
uncertainty and the residual eects of the pandemic. Risk management processes
have been further strengthened in the year and the internal audit function has been
successfully expanded representing the achievement of key objectives in respect
of risk and internal control for the Group.”
Keith Mansield
Audit Committee Chair
Committee Governance
Committee membership
During the year the Committee
comprised:
Keith Mansield (Chair)
Adele Cooper
Mary McNamara
The Committee met three times
during the year and attendance is
set out in the table on page 73.
Financial Statements
7776
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
The impacts of COVID-19 were
signiicantly reduced during the
year and the future possibilities
of lockdowns, restrictions and
mandatory isolation periods, all of
which could impact the operations
of the Group, appear to be reduced.
This has represented an opportunity
for renewed focus on strategic risks
and objectives. The Group now has
regular third line assurance work
performed, provided by the work
of the newly expanded internal
auditfunction.
I would like to thank my colleagues on
the Committee for their contribution
during this year and extend my
thanks to our colleagues within the
business who have contributed
immensely towards the successful
navigation through a year with
continued operational challenges
anduncertainty.
Committee composition
and membership
The Committee currently comprises
three independent Non-Executive
Directors.
During the year, the following
members served on the Committee:
• Keith Mansield (Chair)
• Adele Cooper
• Mary McNamara
The Committee met three times
during the year and attendance is
set out in the table on page 79.
The Board believes that the members
of the Committee as a whole have
competence relevant to the sector
in which the Group operates, gained
from their respective external roles,
previous and present. Biographical
details of Committee members are
set out on pages 68 and 69.
In particular, the Board has identiied
me as the member of the Committee
having recent and relevant inancial
experience for the purposes of
the 2018 Code. I have a wealth of
accounting experience from my
previous roles, having worked at
PricewaterhouseCoopers LLP
(‘PwC’) for 30 years.
At the invitation of the Chair of the
Committee, the Chair, CEO and CFO
attended all meetings during the year
in order to maintain eective and
open communications.
The external auditors, PwC, attend
meetings of the Committee and
have direct access to the Committee
should they wish to raise any
concerns outside of the formal
Committee meetings.
Role of the Committee
The role and responsibilities of
the Committee are set out in its
terms of reference which are
available on the Company’s website
motorpointplc.com. The key
objectives of the Committee are to
review and report to the Board and
shareholders on the Group’s inancial
reporting, internal control and risk
management systems, and on the
independence and eectiveness
of the external auditor.
Further details on the responsibilities
of the Committee are as follows:
• Monitor the inancial reporting
process including the review
of the integrity of the inancial
statements of the Company,
including its annual and half year
inancial results. Other formal
announcements relating to
inancial performance or inancial
information contained in certain
other documents is reviewed
by the Board and therefore
not speciically discussed by
theCommittee;
• Review and assess the Annual
Report in order to determine
whether it can advise the Board
that, taken as a whole, the Annual
Report is fair, balanced and
understandable, and provides
shareholders with the information
they need to assess the
Company’s position, performance,
business model and strategy;
• Review reports from the internal
audit function;
• Monitor the statutory audit of
the annual and the consolidated
inancial statements;
• Review signiicant inancial
reporting issues;
• Recommend to the Board the
reappointment of the external
auditor and approve their
remuneration and terms of
engagement; and
• Monitor and review the external
auditor’s independence and
objectivity and the eectiveness
of the external audit process,
including considering relevant
UK professional and regulatory
requirements and the
appropriateness of the provision by
the auditors of non-audit services.
The terms of reference authorise the
Committee to obtain independent
legal or other professional advice
at the Company’s expense.
Activities
The Committee reviewed the
following items since the last report:
• Annual Report and Accounts to
31 March 2022 and half year
results to 30 September 2021;
• Chair met and had discussions
with PwC as part of the audit
process;
• External audit plan and review
of eectiveness;
• Non-audit services policy
(‘NAS’) and reached a general
presumption that PwC is not
best placed to oer NAS so as to
safeguard their independence;
• The Group’s prospects (going
concern and viability);
• Tax and treasury policy;
• Corporate risk assessment
including review of the key risks,
risk management activities and
emerging risks;
• Findings from the external auditor
on the FY22 year end audit;
Audit Committee report continued
• Findings from initial risk
assessments performed by
internal audit and the internal
audit plan for FY23; and
• Considered the letter from the
Financial Reporting Council’s
review of the 2021 Annual Report,
which did not identify any
notable concerns. Some minor
observations were raised which
have been addressed in this
year’s report.
Financial reporting
The primary role of the Committee
in relation to inancial reporting is
to review with both management
and the external auditor, and report
to the Board the appropriateness
of the annual inancial statements,
considering amongst other matters:
• Clarity of the disclosures and
compliance with inancial
reporting standards and relevant
inancial and governance
reporting requirements;
• Areas in which signiicant
judgements have been applied,
including discussions with
appropriate challenge on such
matters undertaken with the
external auditors; and
• Whether the Annual Report, taken
as a whole, is fair, balanced and
understandable, and provides
the information necessary
for shareholders to assess
the Company’s performance,
business model and strategy.
The statement incorporating the
conclusion of this assessment
is included later in this section.
In addition to the above, the
Committee supports the Board in
completing its assessment on the
adoption of the going concern basis
of preparing the inancial statements.
Furthermore, as part of the
Committee’s responsibility to provide
advice to the Board on the long term
viability statement, the Committee
performed a robust review of the
process and underlying assessment
of the Group’s longer term prospects
made by management.
Signiicant matters considered by
the Committee in relation to the
inancial statements
In the preparation and inal approval
of the inancial statements,
the Committee discussed with
management the key sources of
estimation and critical accounting
judgements. The Committee
considered the following signiicant
issues in relation to the FY22 inancial
statements:
• Inventory Valuation: Inventory is
valued at the lower of cost and
net realisable value. Margins
on vehicles have increased in
FY22 due to a global shortage
of semiconductors resulting
in a reduction of the supply of
new vehicles, this in turn has
pushed demand, and therefore
price, up for used cars. There is
a risk that the solving of supply
shortages could lead to selling
prices reducing below cost and
so require a provision against
inventory cost. A provision is
included based on historical and
forecast sales and potential net
realisable value. The Committee
is comfortable based on
performance subsequent to
the year end that the level of
inventory provision is appropriate.
Annual Report
The Committee has undertaken a
review and assessment of the Annual
Report in order to determine whether
it can advise the Board that, taken
as a whole, the Annual Report is
fair, balanced and understandable,
and provides shareholders with the
information they need to assess the
Company’s position, performance,
business model and strategy.
In doing this the Committee
considered the following:
• the description of the business is
consistent with the Committee’s
own understanding;
• the narrative of the strategic
report fairly relects the
performance of the Group over
the period reported on;
• that there is a clear and well
articulated link between all areas
of disclosure including going
concern and viability; and
• the indings from the external
auditor as part of the FY22 year
end audit.
All relevant issues relating to the
Annual Report were fully discussed at
the Committee meeting in June 2022.
The Committee has concluded that
the Annual Report, taken as a whole,
is fair, balanced and understandable
and that it can advise the Board as
required by the 2018 Code and other
relevant rules and regulations.
Going concern and viability
statement
The Company is required to include
statements in its Annual Report
relating to going concern and
viability. The Committee reviewed and
discussed a report from management
and concluded that the inancial
statements can be prepared on a
going concern basis and that there
is a reasonable expectation that the
Group will be able to continue in
operation and meet its liabilities as
they fall due over the next three years.
The Directors assessed the prospects
of the Group over a three-year
period, which relects the budget
and planning cycle adopted by
the Group. The assessment of the
Group’s prospects, together with the
Group’s going concern and Viability
Statement, are set out on pages 103
and 60 respectively of the Corporate
Governance report.
Financial Statements
7978
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Internal audit
A Head of Internal Audit and Risk
was appointed in November 2021
following the FY21 decision that the
structure of the function should be
expanded. At each meeting, the
Committee receives a report from
internal audit detailing the indings
from completed reviews conducted
during the period, including the status
of agreed management actions to
strengthen internal controls.
The initial focus for the function has
been to:
• conduct a series of risk
assessments across the Group;
• developing a risk based audit plan
to provide third line assurance
over the eectiveness of the
Group’s internal controls; and
• conduct assurance work per the
risk based plan.
The internal audit approach has been
reviewed by the Committee, with the
audit plan approved in January 2022
which is to be delivered throughout
FY23.
External auditor
Independence
There are a number of robust policies
in place, all of which aim to safeguard
the independence of the external
auditor. In accordance with best
practice, the external audit contract will
be put out to tender every ten years,
with the next retender due no later
than the year ending 31 March 2027.
In accordance with the Auditing
Practices Board standards, the lead
audit partner at PwC will be rotated
every ive years to ensure continuing
independence. Mark Skedgel, the
current audit partner, assumed this
responsibility for the year ended
31 March 2020.
There are no contractual obligations
that restrict the Company’s choice
of external auditor.
External auditor eectiveness
The Committee conducts an
annual external audit eectiveness
review each year which examines
the auditor’s independence, the
audit planning process, audit
approach and delivery, audit team
expertise and experience, resources,
responsiveness and communication
in respect of the inancial year
audit. In order to discharge this
responsibility the Committee
followed the process outlined below.
• The terms, areas of responsibility,
duties and scope of work of the
external auditor as set out in the
engagement letter are reviewed
at the Committee meetings;
• The Committee discusses and
agrees at the planning stage the
draft list of speciic risks to audit
eectiveness and quality (speciic
audit quality risks);
• The Committee assesses audit
planning work in respect of
speciic audit quality risks;
• The narrative of the Strategic
Report fairly relecting the
performance of the Group
over the period reported on;
• All Committee members, key
members of management, and
those who regularly provide
input into the Committee provide
feedback on how well PwC
performed the year end audit; and
• The feedback and conclusions
are discussed, along with the
conclusion regarding speciic
audit risks, with an overall
conclusion on audit eectiveness
reached. Any opportunities for
improvement are brought to the
attention of the external auditor.
The Committee concluded that PwC
provided an eective, independent
and objective audit and that the
Committee was therefore satisied
that it had obtained a high quality
audit. The Committee agreed
to recommend to the Board the
reappointment of PwC as the Group’s
external auditor and a resolution to
this eect will be proposed at the
2022 AGM.
Non-audit services
To further safeguard the
independence and objectivity of the
external auditor, non-audit services
provided by the external auditor are
considered, and where appropriate
authorised, by the Committee in
accordance with a non-audit services
policy. This policy limits the amount
and type of services undertaken
by our auditor. Permitted services
are subject to a cap of 70% of the
average of the fees paid for the
statutory audits over a three-year
period.
There were no non-audit fees for
the year ended 31 March 2022.
Keith Mansield
Audit Committee Chair
15 June 2022
Audit Committee report continued Nomination Committee report
Dear Shareholder
I am pleased to present the report
of the Nomination Committee (the
‘Committee’) for FY22. Typically, this
report would be presented by the
Committee’s Chair, but since the most
important work of the year related
to the change of the chair, as Senior
Independent Director and in keeping
with the spirit of the 2018 Code, it is my
pleasure to present the report this year.
I would like to take the opportunity,
on behalf of the Board, to place on
record our thanks to Mark Morris for his
work with the Board and leadership of
Motorpoint from 2011 to2022.
The Nomination Committee keeps
under regular review the structure
and composition of the Board and
its committees and ensures that the
Board has the appropriate balance
of skills, expertise and experience to
support the Company and ensure the
appropriate corporate governance
standards and practices are in place.
In FY22, the Committee continued
to focus on ensuring that the Board
is composed of members with the
appropriate balance of skills, expertise
and experience to support the
Company and ensure the appropriate
corporate governance standards and
practices are in place. This included
the search for and recommendation
of our new Chair of the Board and
of the Nomination Committee,
John Walden.
The Committee regularly reviews the
diversity of the Board, its committees
and senior management, as part
of the Board evaluation process.
Issues of diversity and inclusion are
considered by the Board directly due
to their signiicance and importance
within the business. I believe the
Company will be more successful if
it creates an inclusive and supportive
culture where every individual, of
any identity, from any background,
feels they can be their authentic self
at work. Further details on diversity
within the business can be found
within the Strategic Report on pages
49 and 50.
The Committee carried out an
internally facilitated review of its
eectiveness and the output was
discussed by the Committee. This
concluded that the Board was
operating eectively. The Committee
will also oversee any new diversity
and inclusion initiatives for FY22.
All Directors are subject to election
or re-election to the Board by
shareholders on an annual basis
at the Company’s AGM.
The Chair, on behalf of the Board, has
conirmed each Director continues
to be an eective member of the
Board and will stand for election
or re-election at the 2022AGM.
Nomination Committee
Chair’s Statement
Committee Governance
Committee membership
and attendance
During the year the Committee
comprised:
Mark Morris
(Chair until 10 January 2022)
John Walden
(Chair from 10 January 2022)
Adele Cooper
Keith Mansield
Mark Carpenter
Mary McNamara
The Committee met four times
during the year and attendance is
set out in the table on page 73.
Financial Statements
8180
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Committee responsibilities
The Committee is responsible for:
• Board composition: The
Committee considers the balance
of skills, diversity, knowledge
and experience of the Board
and its committees and reviews
the Board’s structure, size and
composition, including the time
commitment required from
Non-Executive Directors;
• Board nominations: The
Committee leads on the
recruitment and appointment
process for Directors and makes
recommendations regarding any
adjustments to the composition
of the Board;
• Succession planning:
The Committee proposes
recommendations to the Board
for the continuation in service of
each Director and ensures that
the Board is well prepared for
changes to its composition and
that appropriate succession
plans are in place.
The Committee has formal terms
of reference which are available
on the Company’s website
motorpointplc.com.
Activities of the Committee
During the year the main activities
of the Committee were as follows:
• Oversaw the appointment of the
new Chair of the Board and of
the Nomination Committee; and
• Supported the Executive team
in considering strategic hires of
senior executives in light of the
changing industry landscape,
including the appointment of a
irst ever Chief Digital Oicer in
February 2022.
Chair recruitment process
The Nomination Committee oversaw
the search and appointment of a new
Chair to replace Mark Morris who
announced in November his plan to
retire from the Company in January
2022. The process, which was agreed
in advance by the Committee, was
thorough and inclusive. An external
search led by digital executive search
irm, The Up Group, was followed
by an interview process which gave
the Non-Executive Directors the
opportunity to meet shortlisted
candidates.Following the interviews,
the Nomination Committee met to
discuss feedback on each candidate
and was unanimous in its inal
selection and recommendation to the
Board that John Walden be appointed
as Chair of the Board and of the
Nomination Committee with eect
from 10 January 2022.
Composition of the Board as at
31March 2022
INED/Executive split
Chair 1
INED (excluding the Chair) 3
Executive 2
Male/female split
Male 4
Female 2
Diversity and inclusion
The Board recognises the importance
of diversity and inclusion in the
boardroom and seeks to recruit
Directors with varied backgrounds,
skills and experience. Appointments
are made on merit and against
objective criteria, taking account of
the skills, experience and expertise
ofcandidates.
At the year end there were two female
members of the Board, representing
33% of the Board, which meets the
33% target for FTSE 350 boards set
by the Hampton-Alexander Review.
The Board aims to retain or improve
this level in the future and look to
improve on other areas of diversity
too, including ethnicity and the
recommendations set out by the
Parker Review.
The Board’s composition and
size is kept under review by the
Nomination Committee in order
to retain an appropriate balance
of skills, experience, diversity and
knowledge of the Group. The Board
also recognises the importance
of diversity and inclusion at senior
management level. The Group’s
Senior Leadership Team, who are
direct reports to the CEO, is made up
of seven members including the CEO
and CFO. There are 43 direct reports
to the Senior Leadership Team for
the purposes of Hampton-Alexander
Reporting. Information on initiatives
on diversity and inclusion can be
found in the People section of the
Strategic Report on page 49.
Nomination Committee report continued
2022 Board and Committee Eectiveness Review
The Board undertakes a formal evaluation of its performance, and that of each Director, on an annual basis. The principal
committees of the Board undertake an annual evaluation of their eectiveness, in accordance with their terms of
reference. In early 2022, an internally facilitated evaluation of the Board and its committees, which took the form of a
questionnaire, was circulated to the relevant Board members. The questionnaire sought input on a range of matters
including composition and diversity of the Board, senior leadership succession, review of strategic plans and the
adequacy of the information in Boardpapers.
The results of the internal review were circulated to members of the Board and its recommendations were discussed
and adopted at the March 2022 Board meeting. A number of actions were identiied as set out in the below table.
Issue/Recommendation Action
Stakeholder engagement Stakeholder engagement will be further enhanced through the development
of a structured and suitable programme of events, meetings and/or forums to
ensure regular, quality dialogue between the Board and stakeholders. Speciic
focus will be given to understanding stakeholder views on ESG matters to ensure
alignment with the Company’s ESG strategy.
The Board will regularly review the list of identiied stakeholders to ensure it
remains relevant.
Company secretarial support The Company Secretary has had varying levels of interim company secretarial
support through the year. The level of support required will be monitored to
ensure good governance practices are consistently followed.
Quality of Board papers The new Chair and Company Secretary to review the information provided
in operational reports to ensure that the quality of Board papers addresses
the appropriate topics and has suicient level of detail. A new format will be
introduced for all Board papers to clearly identify the purpose and the ask of
Board members in each case.
Externally facilitated Board evaluation External Board evaluation to be sought during FY23.
The Board is satisied that each Director continues to contribute eectively to the Board and the Board’s committees.
Election or re-election of Directors
In compliance with the 2018 Code, all of the current Directors will stand for re-election at the forthcoming AGM.
In addition, John Walden will stand for irst election at the AGM. Following the annual evaluation of the Board and
its committees, and the recruitment process for John Walden, the Board has determined that all Directors standing
for election or re-election at the AGM continue to be eective, hold recent and relevant experience and continue to
demonstrate commitment to the role.
Biographical details of each Director standing for election or re-election will be set out in the Notice of AGM.
Mary McNamara
Senior Independent Director
On behalf of the Nomination Committee Chair
15 June 2022
Financial Statements
8382
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Remuneration Committee report
Remuneration Committee
Chair’s Statement
Dear Shareholder
I am pleased to present the
Company’s Directors’ Remuneration
Report for the inancial year ended
31 March 2022.
Board changes
In January 2022, Mark Morris retired
from the Board and stepped down
from his role as Non-Executive Chair.
We were delighted that John Walden
joined the Board as our Non-Executive
Chair and Chair of our Nomination
Committee on 10 January 2022.
Recognising alternative opportunities
open to John at the time of his joining
Motorpoint, the Committee agreed to
a irst year fee of £300,000, £100,000
of which has been used to invest
in Company shares, plus an annual
fee of £200,000 per year, which will
be the fee level after the irst year.
John has also agreed to purchase
£200,000 worth of shares within the
irst year of joining, which he will hold
for the duration of his tenure. He will
receive no other fees.
Performance for FY22 and
remuneration outcomes
Following the return to more normal
trading conditions early in FY22, the
Group enjoyed an excellent year, with
internal targets being exceeded. In
addition to inancial measures, strong
progress was made against strategic
objectives, with three new branches
opened, the development of the
digital irst car buying service and the
upgrade of the Auction4Cars.com
platform to operate as an automated
marketplace. NPS (which measures
customer satisfaction) was a record
84. As a consequence of these
achievements, the Committee agreed
that a signiicant majority of the
eligible bonus (93.8%) relating to
FY22 be paid.
Mark Carpenter’s PSP award granted
in July 2019 was subject to 50% on
EPS growth targets and 50% on
market share growth of 0-2 year old
vehicles measured over the three-
year period to 31 March 2022. Due to
COVID-19, as well as other external
inluences, EPS grew by 2%, and
market share fell by 7.2% (both based
on compound annual growth rate).
As a result of the threshold targets not
being met, the award will lapse in full.
In accordance with our Executive
Remuneration Policy, we encourage
inancial and operational performance
and align the interests of Directors
with the Company strategy through
an annual bonus. Annual bonuses are
payable at the sole of discretion of
the Committee, which has the ability
to adjust the formula driven outturn
of the annual bonus calculation.
Performance will normally be based
on a mix of inancial and operational
measures aligned to the strategic
objectives of the business.
The table below provides a summary of total remuneration for the Executive Directors for FY22.
Salary (£’000) Beneits (£’000) Pension (£’000) Bonus (£’000) RSA (£’000) Total (£’000)
Mark Carpenter 350 2 35 329 262 978
Chris Morgan 255 2 8 240 191 696
Committee Governance
Committee membership
During the year the Committee
comprised:
Mary McNamara (Chair)
Adele Cooper
Keith Mansield
The Committee met four times
during the year and attendance is
set out in the table on page 73.
Performance targets were previously
based on the Company’s strategy of
targeting the 0-3 year old car market.
However, the reduced supply of new
vehicles led the Company to revise
its core oering to the 0-4 year old
car market and thereby ensuring
sustainable business growth. As
such, it is deemed appropriate for
performance targets in respect of
the annual bonus to be aligned to
this change and performance has
therefore been measured against
relevant thresholds for the 0-4 year
old car market. The Committee is
satisied that the use of discretion has
resulted in revised targets that are
equally as challenging as the original
targets set.
The Committee is comfortable that
the Policy has operated as intended
and that remuneration is appropriate
taking into account the use of
discretion for the annual bonus,
the CEO pay ration for FY22 and
the performance delivered during
theyear.
Application of the Policy for FY23
Salary increases for both Executive
Directors will be in line with the
increase for the workforce of 3%
ofsalary.
The annual bonus opportunity will
remain at 100% of salary and will be
based on PBT, market share growth,
customer satisfaction and employee
engagement metrics. In addition,
we will introduce an environmental
metric based on sales of electric
vehicles, and also set individual
targets in line with the Company’s
strategic objectives, including as
appropriate, relating to digitisation of
the business and Auction4Cars.com.
Restricted Share awards will be
made at 75% of salary level for both
Executive Directors.
The Committee is kept aware of
the latest developments in the
executive pay arena, particularly
those recommended by institutional
shareholders and we monitor these
closely. We believe that Motorpoint’s
approach to remuneration is
appropriate and represents a fair
balance between shareholder and
management interests.
On behalf of all of my colleagues on
the Committee, I hope that you will
support the resolution approving the
Annual report on remuneration at this
year’s AGM.
Consideration of pay conditions
within the wider team
When making decisions on executive
remuneration, the Committee takes
into account pay conditions for the
Company as a whole, although it
has not, to date, consulted directly
with employees on this subject. The
Committee will review its approach
to engaging with employees
on remuneration matters and in
particular to explain how the pay for
senior executives aligns to the pay
practices for the workforce generally.
The Group has a strong ‘team culture’
and accordingly there is consistency
in how packages are structured
across the whole Senior Leadership
Team, with all Executive Directors and
senior managers participating in the
same annual incentive plan.
However, there are some dierences
in the structure of the remuneration
policy for the Executive Directors
compared with other senior
managers, which the Committee
believes are necessary to relect
the dierent levels of responsibility.
The two main dierences are the
increased emphasis on performance
related pay for Executive Directors
(through a higher variable pay
opportunity) and a greater focus
on long term alignment (through
additional holding periods for the long
term incentive awards and minimum
shareholding guidelines).
In relation to share based incentives,
senior managers participate in a
Restricted Shares plan, with shares
awarded linked to performance and
service, which must be held for the
long term.
The Board did not engage with the
workforce in FY22 to explain the
alignment between executive pay
and that of the workforce generally
but will review how best do so in the
coming year.
Shareholder views
The Committee values the views of
the Company’s shareholders and
takes into account guidance from
shareholder representative bodies.
Shareholder feedback received in
relation to the AGM, as well as any
additional feedback received during
the year, will be considered as part
of the Company’s annual review.
Before any signiicant changes to
the Policy are proposed, the Chair
of the Committee will discuss these
changes with the Company’s major
shareholders to ensure that the Policy
remains supportive of their interests.
The Committee consulted extensively
in relation to the remuneration policy
approved in 2020 and changes were
made to incorporate shareholders’
feedback and again in relation to the
salary increase for the CEO.
Mary McNamara
Remuneration Committee Chair
15 June 2022
Financial Statements
8584
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Remuneration policy
Directors’ remuneration policy
This section of the report details the
Remuneration Policy for Executive
Directors. The Policy was approved
at the 2020 AGM on 24 August
2020 and is eective for up to three
years from this date. A copy of the
Policy can be found within the 2020
Annual Report and Accounts at
www.motorpointplc.com.
Compliance statement
This report has been prepared in
accordance with the provisions of the
Companies Act 2006 and Schedule
8 of the Large and Medium-sized
Companies and Groups (Accounts
and Reports) (Amendment)
Regulations 2013 (Regulations). It
also meets the requirements of the
UK Listing Authority’s Listing Rules
and the Disclosure and Transparency
Rules. The sections of the
Remuneration Report that are subject
to audit are marked as Audited
Information. The remaining sections
of the Remuneration Report are not
subject to audit.
Purpose and link to strategy Operation Performance Measurement Maximum Opportunity
Base salary
To aid the recruitment of
Executive Directors of a
suitable calibre for the role
and to provide a core level
of reward to relect the
duties required.
Base salaries will normally be
reviewed annually by the Committee
with any increases typically taking
eect from 1 April each year.
Base salary levels are set at a
level to relect the experience,
skills and responsibilities of the
individual as well as the scope
and scale of their role.
Increases to base salary will
relect the performance of the
individual and Company and
external indicators such as
inlation.
While there is no maximum
salary, increases will normally
be in line with the typical level
of increase awarded to other
employees of the Group.
For details of the current base
salary levels for the Executive
Directors see page 97.
Beneits
To provide a market
competitive beneits
package for the executives
to aid recruitment and
retention.
The beneits oered to Executive
Directors comprise family medical
insurance and company car.
The Committee may oer an
equivalent cash allowance instead
if it feels it is more suitable.
Other reasonable beneits may be
oered as appropriate (including, in
exceptional circumstances, relocation
and/or disturbance allowances).
Executive Directors may also be
reimbursed for any reasonable
expenses incurred in performing their
duties, and any income tax payable
thereon.
Not applicable. There is no maximum limit on the
value of the beneits provided
but the Committee monitors the
total cost of the beneit provision
on a regular basis.
Pension
To provide market
competitive pension
arrangements for the
executives and to aid
recruitment and retention.
Executive Directors are eligible for a
contribution to the Group personal
pension plan, or any other nominated
personal pension fund.
Where appropriate, Executive
Directors may instead receive a cash
allowance in lieu of formal pension
contributions, or a combination
of both.
Not applicable. 10% of base salary for the CEO.
At the end of this policy period
the pension contribution for all
Executive Directors will reduce
to the same percentage that
applies to the majority of the
workforce. The pension for the
CFO, appointed in January 2021,
is 3% of salary.
For new appointments, pension
contribution will be aligned to
the contribution available to
the majority of the workforce.
A breakdown of all elements of the Executive Remuneration Policy and an explanation of how they operate can be found
in the table below:
Purpose and link to strategy Operation Performance Measurement Maximum Opportunity
Annual bonus
To encourage improved
inancial and operational
performance and align
the interests of Directors
with the short term
Companystrategy.
Executive Directors are eligible for
bonuses, payable in cash, on an
annual basis. Bonus payments are
subject to the achievement of annual
performance targets.
Annual bonuses are payable at the
sole discretion of the Committee.
The Committee has discretion to
adjust the formula driven outturn
of the annual bonus calculation.
All bonus payments are subject
to appropriate recovery and
withholdingarrangements.
Performance will normally be
based on a mix of inancial and
operational measures aligned
to the strategic objectives of
thebusiness.
Financial performance will
usually be represented by PBT
targets, although the Committee
reserves the right to include
other measures in support of the
Company strategy as it sees it.
Stretching performance targets
will be determined taking into
account internal and external
forecasts, and will be set out
on a retrospective basis in the
Annual Report on Remuneration,
unless considered to still be
commercially sensitive.
100% of salary.
Long term incentives – Restricted Shares
To encourage improved
inancial and operational
performance and align the
interests of Directors with
the long term Company
strategy and the interests
of shareholders through
shareownership.
Restricted Shares will be granted
to Executive Directors and selected
Senior Managers.
Awards will normally be granted
following the publication of the
Company’s annual results each year.
Restricted Shares may normally
vest no sooner than 50%, 25% and
25% over three, four and ive years
from grant, subject to service, and
subject to an underpinning inancial
performance condition.
Awards are additionally subject to a
post vesting holding period during
which time vested shares may not be
sold (other than for tax) before ive
years from grant.
This holding period will continue
post cessation of employment (to
the extent that awards do not lapse).
The Committee may determine that
dividend equivalents will accrue over
the vesting/holding period.
Vesting of awards is at the sole
discretion of the Committee and the
Committee may reduce the level of
the award after grant and at vesting,
if it considers that it is appropriate
to do so.
Restricted Shares are subject
to recovery and withholding
arrangements.
In order for Restricted Shares
to vest, the Remuneration
Committee must be satisied
that business performance is
robust and sustainable and that
management has strengthened
the business. In assessing
this performance condition,
the Committee will consider
inancial and non-inancial
KPIs of the business as well
as delivery against strategic
priorities. To the extent it is not
satisied that this performance
condition is met, the Committee
may scale back the level of
vested awards including to zero.
This performance assessment
will take place at the end of the
third year.
Normally 75% of salary.
However, an individual maximum
of 100% of salary may apply in
exceptional circumstances.
Financial Statements
8786
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Remuneration policy continued
Purpose and link to strategy Operation Performance Measurement Maximum Opportunity
All employee share plans
To align the interests
of Directors and other
employees with those of the
shareholders through share
ownership.
The Company has adopted employee
share plans in which the Executive
Directors are eligible to participate
on the same terms as all other
employees.
Not applicable. In line with statutory limits.
Shareholding guidelines
To align the interests of
Directors with those of the
shareholders through share
ownership.
All Executive Directors are required
to build and maintain a shareholding
equivalent in value to 200% of their
annual base salary.
Until this guideline is met, Directors
must retain half of any Restricted
Shares that vest (after payment of tax
and national insurance contributions).
Post cessation of employment,
Executives will be required to retain
the lower of the shareholding
requirement (200% of salary) or the
actual shares they hold on cessation
of employment for a period of two
years. Any future purchases of
shares by the Executives will be
excluded from this requirement.
The Committee has discretion to
amend the requirement in certain
circumstances as it considers
appropriate.
Not applicable. Not applicable.
Choice of performance measures
The Committee retains lexibility as to the choice of performance measures for future annual bonus and PSP award cycles.
Measures will be selected as appropriate to relect the business strategy and to ensure the delivery of sound inancial
performance. The current performance measures are disclosed in the Annual report on remuneration, together with the
link to the business strategy.
Incentive plan operation
The Committee will operate the Company’s incentive plans according to their respective rules and consistent with normal
market practice, the Listing Rules and HMRC rules where relevant, including lexibility in a number of regards.
This includes timing of awards, dealing with leavers and making adjustments to awards following acquisitions, disposals,
changes in share capital and other merger and acquisition activity. The Committee also retains the ability to adjust the
targets and/or set dierent measures for the annual bonus plan and outstanding PSP awards if events occur which cause
it to determine that the conditions are no longer appropriate and the amendment is required so that the conditions
achieve their original purpose and are not materially less diicult to satisfy. The Committee may adjust the formula driven
outturn of the annual bonus calculation in the event it considers that the outturn does not relect underlying performance,
overall shareholder experience or employee reward outcome.
Recovery and withholding provisions may be operated at the discretion of the Committee in respect of awards granted
under the annual bonus plan arrangements, outstanding PSP awards and Restricted Shares in certain circumstances
(including where there is a material misstatement or restatement of audited accounts, an error in assessing any applicable
performance condition or bonus outcome, or in the event of gross misconduct on the part of the participant, corporate
failure, failure of risk management or reputational damage).
Any use of the above discretions would, where relevant, be explained in the Annual report on remuneration.
Remuneration Policy for Non-Executive Directors
The table below sets out how pay is structured for the Non-Executive Directors.
Purpose and link to strategy Operation Performance Measurement Maximum Opportunity
Fees
To ensure a fair reward for
services provided to the
Company.
NEDs receive a ixed base fee
for their role on the Board, plus
supplementary fees for additional
responsibilities such as performing
the role of SID, or chairing one of the
Board Committees.
The Non-Executive Chair receives a
ixed fee only, and is not eligible for
any additional responsibility fees.
Fee levels are reviewed on an annual
basis, and may be increased taking
into account factors such as the time
commitment of the role and market
levels in companies of comparable
size and complexity and other
broadly comparable companies.
Each NED will be entitled to be
reimbursed for all reasonable
expenses incurred by them in the
course of their duties to the Company
and has the beneit of indemnity
insurance maintained by the Group
on their behalf indemnifying them
against liabilities they may potentially
incur to third parties as a result of his/
her oice as Director.
Where there has been a material
increase in time commitment in
the year fees may be temporarily
increased to relect this.
Not applicable. Current fee levels are set
out in the Annual report on
remuneration.
Aggregate fee levels are subject
to the maximum limit set out in
the Articles of Association.
Share ownership guidelines
To align the interests of
Directors with those of
shareholders through
share ownership.
All NEDs are encouraged to build and
maintain a shareholding equivalent in
value to 100% of their annual fees.
Not applicable. Not applicable.
Financial Statements
8988
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Remuneration policy continued
Reward scenarios
The bar charts below detail how the composition of the Executive Directors’ remuneration package varies at dierent
levels of performance.
• Threshold includes ixed pay only (i.e. base salary, beneits and pension).
• On target includes ixed pay, 60% of maximum bonus, and full vesting of Restricted Shares.
• Maximum includes ixed pay, maximum bonus payout, and full vesting of Restricted Shares.
• Maximum plus the impact of 50% share price appreciation on Restricted Shares.
Salary levels are eective as at 1 April 2022, and the value for beneits is the cost of providing those beneits in FY22.
No share price growth has been factored into the chart, except where indicated, and all amounts have been rounded
to the nearest £1,000.
£1,400,000
£1,200,000
£1,000,000
£800,000
£600,000
£400,000
£200,000
Chief Executive Oicer Chief Financial Oicer
£0,000
£399,000
Threshold ThresholdOn target On targetMaximum MaximumMaximum
with 50%
share price
appreciation
Maximum
with 50%
share price
appreciation
£273,000
£627,000
£831,000
£1,029,000
£885,000
Fixed Pay Annual Bonus Restricted Shares
100% 45%
24%
31%
39%
35%
26%
34%
100% 44%
25%
36%
27%
31%
36%
32%
37% 32%
31%
35%
£1,165,000
£732,000
Approach to recruitment remuneration
New Executive Director hires (including those promoted internally) will be oered packages in line with the Policy in place
at the time, except as noted below:
• If it is considered appropriate to set the salary for a new Executive Director at a level which is below market, his or
her salary may be increased in future periods to achieve the desired market positioning by way of a series of phased
above inlation increases, subject to his or her continued development in the role.
• Any bonus payment for the year of joining will normally be pro-rated to relect the proportion of the period worked,
and the Committee may set dierent performance measures and targets, depending on the timing and nature of
the appointment.
• The Committee recognises that it may be necessary in some circumstances to provide compensation for amounts
forfeited from a previous employer (‘buy out awards’). Any buy out awards would be limited to the value of
remuneration forfeited when leaving the former employer and would be structured so as to be, to the extent possible,
no more generous in terms of the key terms (e.g. time to vesting and performance targets) than the incentive it is
replacing. Where possible any such payments would be facilitated through the Company’s existing incentive plans,
but, if not, the awards may be granted outside of these plans, as permitted under the Listing Rules, which allow for
the grant of awards to facilitate the recruitment of an Executive Director.
• In the case of an internal appointment, any variable pay element awarded in respect of the prior role will be allowed
to pay out according to its original terms or adjusted as considered appropriate to relect the new role.
External directorships
Executive Directors are permitted to take on external non-executive directorships at other listed companies, though
normally only one other appointment, to bring a further external perspective to the Group and help in the development
of key individuals’ experience. In order to avoid any conlicts of interest, all appointments are subject to the approval of the
Nomination Committee. Executive Directors are permitted to retain the fees arising from any appointments undertaken.
Service contracts and payments for loss of oice
The terms of Directors’ service contracts and letters of appointments are set out below. All Executive Directors’
service agreements and Non-Executive Directors’ letters of appointment are available for inspection at the Company’s
registered oice.
Director Date of contract / letter Date of expiry
Notice period by Company
or Director
Executive Directors
Mark Carpenter 12 May 2016 N/A 9 months
Chris Morgan 11 January 2021 N/A 9 months
Non-Executive Directors
John Walden 10 January 2022 10 January 2025 3 months
Mary McNamara 14 May 2019 14 May 2022 3 months
Adele Cooper 6 March 2020 6 March 2023 3 months
Keith Mansield 20 May 2020 20 May 2023 3 months
Financial Statements
9190
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Remuneration policy continued
The remuneration related elements of the current contracts for Executive Directors are as follows:
Provisions Treatment
Termination payment The Company may (at its discretion) elect to terminate the employment by making a payment
in lieu of notice equivalent in value to the base salary which the Executive Director would have
received during any unexpired period of notice.
Mitigation The payment in lieu of notice will be payable in monthly instalments (subject to mitigation,
i.e. reduced on a pound for pound basis if alternative employment/engagement is taken up
during the payment period).
Annual bonus There is no contractual right to any bonus payment in the event of termination although in
certain circumstances the Committee may exercise its discretion to pay a bonus for the period
of employment and based on performance assessed after the end of the inancial year.
Share awards The default treatment, under the PSP plan rules (including in relation to Restricted Shares) is for
all unvested awards to lapse in full on cessation.
However, if the participant ceases to be an employee or a Director within the Group because
of his/her death, injury, disability, retirement, redundancy, their employing company or the
business for which they work being sold out of the Group or in other circumstances at the
discretion of the Committee, then his/her award will normally vest on the original scheduled
vesting date (except in the case of death, where the default position will be for the award to
vest on cessation of employment).
The default position in this case is that an award will vest subject to: (i) the extent to which the
performance conditions (if any) have been satisied over the full performance period; and (ii)
the prorating of the award by reference to the period of time served in employment during
the normal vesting period. However, the Committee can decide to allow early vesting and/
or reduce or eliminate the prorating of an award if it regards it as appropriate to do so in the
particular circumstances.
Other Outstanding shares under an all employee share plan will vest in accordance with the terms
of the plan and HMRC legislation.
The Committee may pay any statutory entitlements or settle or compromise claims in
connection with a termination of employment, where considered in the best interest of
the Company.
Outplacement services and reimbursement of legal costs may also be provided.
Annual report on remuneration
This part of the report has been prepared in accordance with Part 4 of The Large and Medium-sized Companies
and Groups (Accounts and Reports) (Amendment) Regulations 2013 which amended The Large and Medium-sized
Companies and Groups (Accounts and Reports) Regulations 2008, and 9.8.6R of the Listing Rules. The Annual Report
on Remuneration will be put to an advisory shareholder vote at our next AGM.
Committee membership and attendance
During the year the Committee comprised:
Mary McNamara (Chair)
Adele Cooper
Keith Mansield
The Chair and CEO attend meetings by invitation but are not members of the Committee.
The Committee met four times during the year and attendance is set out in the table on page 73.
Advice to the Committee
The Committee receives information and takes advice from inside and outside the Group. Internal support is provided by
the Company Secretary. The CEO and any other Director or employee may be invited to attend Committee meetings by
the Chair where relevant. No individual is present when matters relating to his or her own remuneration are discussed.
Following a formal review by the Committee during 2020, Korn Ferry was appointed as adviser to the Committee. Korn
Ferry is a signatory to the Remuneration Consultants’ Code of Conduct and has conirmed to the Committee that it
adheres in all respects to the terms of the Code. Fees paid to Korn Ferry during the year were £48k (ex VAT), which
relected the applicable hourly rates agreed with Korn Ferry. The Committee is satisied, following a discussion involving
all the members of the Committee, that the advice it received is objective and independent. Korn Ferry did not provide
any other services to the Company during the year.
Remuneration in FY22
Directors’ single igure of remuneration (audited)
The table below shows the aggregate emoluments earned by the Directors of the Company during FY22 and also sets out
the comparative information for FY21.
Director Period
Salary/fees
(£’000)
Beneits
1
(£’000)
Pension
(£’000)
RSA
2
(£’000)
Total ixed
remuneration
(£’000)
Bonus
(£’000)
PSP
3
(£’000)
Total variable
remuneration
(£’000)
Total
(£’000)
Mark Carpenter FY22 350 2 35 262 649 329 0 329 978
FY21 231 2 27 206 466 0 0 0 466
Chris Morgan FY22 255 2 8 191 456 240 0 240 696
FY21 58 1 2 0 61 0 0 0 61
John Walden
4
FY22 144 0 0 0 144 0 0 0 144
FY21 N/A N/A N/A N/A N/A N/A N/A N/A N/A
Mark Morris
5
FY22 78 0 0 0 78 0 0 0 78
FY21 100 0 0 0 100 0 0 0 100
Mary McNamara FY22 53 0 0 0 53 0 0 0 53
FY21 49 0 0 0 49 0 0 0 49
Adele Cooper FY22 40 0 0 0 40 0 0 0 40
FY21 38 0 0 0 38 0 0 0 38
Keith Mansield FY22 47 0 0 0 47 0 0 0 47
FY21 40 0 0 0 40 0 0 0 40
1. Relates to provision of family private medical insurance.
2. The face value on grant of the RSA awards is shown in the table above as there are no performance conditions other than underpins tested on vesting.
3. The 2018 and 2019 PSP awards lapsed in full.
4. From his appointment on 10 January 2022, and includes a one-o fee of £100,000, the net amount of which he will invest in Company shares.
5. Mark Morris retired on 10 January 2022.
Financial Statements
9392
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Details of variable pay earned in the year (audited)
Annual bonus
Executive Directors were eligible for a maximum annual bonus payment of 100% of salary, subject to PBT, market share
growth, customer and employment engagement measures, along with selected strategic objectives.
The table below sets out the performance conditions and targets that were set in relation to FY22 and the performance
achieved. As set out earlier in this report, the Committee exercised discretion in relation to the growth in share of the
0-4 year old car market performance condition. The Committee is satisied this exercise of discretion is appropriate and
results in targets equally as challenging as the targets originally set.
Weighting Performance required
1
Performance
achieved
Payout of
element (%
of element
weighting)
Performance measure
Threshold
(30% payout)
Stretch
(100% payout)
PBT 15% £19.97m £21.97m £21.5m 13.8%
Growth in share of 0-4 year old car market 25% +ve +0.5% +0.67% 25%
Customer – NPS 10% 79 83 83.9 10%
Employee engagement 10% 1 star
2
3 star
2
2 star
2
5%
New branches opened 10% 2 3 3 10%
Auction4Cars.com marketplace 10% n/a Operational Operational 10%
Sell your car 20% 500 cars 1,500 2,175 20%
Total 100% 93.8%
1. Payable on a sliding scale between target levels, with the exception of Auction4Cars.com marketplace where the target is either met or not.
2. Employer star rating in the Best Companies b-Heard survey.
The bonus payout for FY22 is 93.8% of maximum which is payable entirely in cash.
Outstanding share awards, including details of awards granted during the year and awards vesting based
on performance to 31 March 2022 (audited)
The below table sets out details of the Executive Directors’ outstanding awards under the PSP and other share schemes.
Name
Year of
grant Scheme
At
31 March
2021
Awards
granted
during the
period
Awards
exercised
during the
period
Awards
lapsed
during the
period
At
31 March
2022
Vesting
date
Exercise
price
Mark Carpenter FY19 2019 PSP 106,339 – – (106,339) 0 20 July 2021 –
FY20 2020 PSP 155,470 – – – 155,470 22 July 2022 –
FY21 2021 RSA 75,753 – – – 75,753 24 Aug 2023* –
FY22 2022 RSA – 95,558 – – 95,558 16 June 2024* –
FY19 2019 SAYE 1,904 – (1,904) – 0 1 Feb 2022 189.00p
FY20 2020 SAYE 1,565 – – – 1,565 1 Feb 2023 230.00p
FY21 2021 SAYE 1,298 – – – 1,298 1 Feb 2024 277.20p
FY22 2022 SAYE – 1,304 – – 1,304 1 Feb 2025 276.00p
Chris Morgan FY22 2022 RSA – 69,621 – – 69,621 16 June 2024* –
FY22 2022 SAYE – 1,304 – – 1,304 1 Feb 2025 276.00p
* The irst tranche of the RSA shares vest on their third anniversary of grant, at 50% of the award and then 25% vests on the fourth and ifth
anniversaries of grant.
Annual report on remuneration continued
Performance Share Plan (‘PSP’) (audited)
Award will vest on the third anniversary of the date of grant, subject to achievement of the below performance conditions.
A two-year post vesting holding period will apply thereafter, during which time any vested shares (net of any taxes due)
may not be sold.
PSP 2020
An award was made to Mark Carpenter under the Company’s PSP to the value of 125% of base salary in July 2019.
The awards are subject to 50% on EPS growth targets and 50% on market share growth of 0-2 year old vehicles measured
over the three inancial years from 1 April 2019 to 31 March 2022. The targets and the performance achieved are set out
below:
EPS growth
(CAGR)
Market share
growth
(0-2 year)
Threshold (12.5%) 7.5% 5.0%
Maximum (50%) 12% 10.0%
Actual performance 2% (7.2)%
As actual EPS growth and market share growth over the period was less than the threshold growth required, the 2020 PSP
will lapse in full. The Committee did not exercise any discretion in determining the inal vesting outcome.
Restricted Share Awards (‘RSA’) (audited)
At the 2020 AGM, shareholders approved that PSP awards be replaced by Restricted Shares. The award level for the
Executive Directors will normally be 75% of salary each year. In order for Restricted Shares to vest, the Committee must be
satisied that the business performance is robust and sustainable, and that management has strengthened the business.
The Restricted Shares ordinarily vest on the third, fourth and ifth anniversaries of the grant (in 50%, 25% and 25% portions
respectively). Awards are additionally subject to a post vesting holding period during which time vested shares may not be
sold (other than for tax) before ive years from grant.
RSA 2021
RSA awards in the form of nil cost options (‘Options’) granted under the rules of the PSP were based on the average of the
closing middle market quotations of the share price during the ive dealing days before grant, being 271.4 pence.
Date of grant
Grant level as
% of salary
Shares
awarded
Share price at
grant date
Face value of
award
Measurement period for
performance underpin
Mark Carpenter 24 August 2020 75% 75,753 271.4p £205,593.64 1 April 2020 to
31 March 2023
RSA 2022
RSA awards in the form of nil cost options (‘Options’) granted under the rules of the PSP were based on the average of the
closing middle market quotations of the share price during the ive dealing days before grant, being 274.7 pence.
Date of grant
Grant level as
% of salary
Shares
awarded
Share price at
grant date
Face value of
award
Measurement period for
performance underpin
Mark Carpenter 16 June 2021 75% 95,558 274.7p £262,497.83 1 April 2021 to
31 March 2024
Chris Morgan 16 June 2021 75% 69,621 274.7p £191,248.89 1 April 2021 to
31 March 2024
Financial Statements
9594
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Annual report on remuneration continued
Save As You Earn (‘SAYE’) (audited)
In December of each year since 2016, Motorpoint has launched a SAYE scheme for all permanent employees. Eligible
employees are invited to subscribe for options over the Company’s shares at an exercise price representing a 20%
discount to the closing mid market price the day before the invitation date. The maximum subscription oered is
£3,600 (equivalent to £100 per month over the 36-month saving period).
Table of Directors’ share interests (audited)
The share interests of each Director as at 31 March 2022 (together with interests held by his or her connected persons)
are set out in the table below.
Executive Directors are required by the Policy to hold shares to the value of 200% of salary and must retain 50% of
any outstanding PSP award vesting or any Restricted Shares vesting (net of any taxes due) until this guideline is met.
Additionally, the Non-Executive Directors are encouraged to hold shares to the value of 100% of their annual fee.
Shareholdings are set out as a percentage of salary or fees in the table below.
At 31 March 2022
Name
Beneicially
owned
shares
1
Unvested PSP
awards
Unvested
Restricted
Share awards
Unexercised
SAYE options Total
Percentage of
salary/fees
3
Executive Directors
Mark Carpenter 8,881,693 155,470 171,311 4,167 9,212,641 7,613%
Chris Morgan 13,445 – 69,621 1,304 84,370 16%
Non-Executive Directors
John Walden – – – – – –
Mark Morris
2
8,509,556 – – – 8,509,556 25,529%
Mary McNamara 65,500 – – – 65,500 374%
Adele Cooper 13,327 – – – 13,327 100%
Keith Mansield 36,876 – – – 36,876 233%
1. Some of these shares may be held through nominees.
2. As at date of retiring on 10 January 2022.
3. Calculated as the value of all fully owned shares held at 31 March 2022, valued using the three-month average share price over the period
to 31 March 2022 (300p), divided by base salary as eective 31 March 2022.
During the period from 31 March 2022 to the publication of this report, there have been no changes in the Directors’
share interests. Details of the PSP 2020, due to lapse in July 2022, can be found on page 93.
None of the Directors hold any loans against their shares or otherwise use their shares as collateral.
External directorships
None of the Executive Directors currently hold non-executive directorships at any other listed companies.
Total shareholder return and Chief Executive Oicer earnings history
The chart below shows the Company’s Total Shareholder Return performance compared with that of the FTSE SmallCap
Index over the period from the date of the Company’s admission onto the London Stock Exchange, to 31 March 2022.
The FTSE SmallCap Index has been chosen as an appropriate comparator as it is the index of which the Company is
a constituent.
140
160
180
200
120
100
80
60
40
20
Value of £100 Invested at IPO (£)
£100 Invested TSR
0
12 May 2016 31 Mar 2017 31 Mar 2018 31 Mar 2019 31 Mar 2020 31 Mar 2021 31 Mar 2022
Motorpoint FTSE SmallCap
The total remuneration igure for the CEO since 9 May 2016 is shown in the table below, along with the value of bonuses
paid, and LTIP vesting, as a percentage of the maximum opportunity.
FY17 FY18 FY19 FY20 FY21 FY22
Total remuneration (£’000) 262 443 287 410 466 978
Annual bonus (% of maximum) 0% 61% 0% 39% 0% 94%
LTIP vesting (% of maximum) N/A
1
N/A
1
0% 0% 0% 0%
1. No long term incentive awards were eligible to vest over the relevant period.
Financial Statements
9796
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Annual report on remuneration continued
Change in remuneration of Directors and employees
The table below compares the dierence in remuneration payable to the Directors over the period FY20 to FY22 to the
average employee of the Company. For the purpose of this disclosure, these igures have been compiled comparing the
average of all employees in the corresponding periods separately and are based on annualised igures for each year.
FY21 vs FY22 FY20 vs FY21
Base
salary/fees
% change
Beneits
% change
Annual
bonus
% change
5
Base
salary/fees
% change
Beneits
% change
Annual
bonus
% change
5
Mark Carpenter (CEO) 51.5% 0% 100% (15.7)% 0% (100)%
Chris Morgan (CFO)
1
N/A N/A N/A N/A N/A N/A
Mark Morris
2
N/A N/A N/A (8.0)% 0% 0%
John Walden
3
N/A N/A N/A N/A N/A N/A
Adele Cooper 5.3% 0% 0% N/A N/A N/A
Keith Mansield
4
17.5% 0% 0% N/A N/A N/A
Mary McNamara 8.2% 0% 0% (7.5)% 0% 0%
Average employee 8.5% 14.6% 41.4% 4.5% 3.0% (4.5)%
1. Chris Morgan joined the Board in January 2021.
2. Mark Morris left the Board in January 2022.
3. John Walden joined the Board in January 2022.
4. Keith Mansield joined the Board in May 2020.
5. Includes performance related commission for employees; Executive Directors elected not to take an annual bonus in 2021.
CEO to employee pay ratio (The Companies (Miscellaneous Reporting) Regulations 2018)
The table below discloses the ratio between the CEO’s remuneration and Motorpoint’s wider workforce.
FY Method
25th
percentile
pay ratio
Median
pay ratio
75th
percentile
pay ratio
2022 Option A 31.3:1 28.3:1 16.4:1
2021
1
Option A 17.6:1 15.8:1 10.7:1
2020 Option A 20.5:1 18.0:1 10.25:1
1. 2021 data restated to ensure same methodology applied as 2022.
Disclosure of employee data used to calculate the ratio for FY22:
25th
percentile
£’000
Median
£’000
75th
percentile
£’000
Total pay and beneits of employees £22,616 £25,159 £43,380
Basic salary of employees £19,760 £20,995 £25,000
The table above sets out the CEO pay ratio for each inancial year from FY20. The CEO pay is compared to the pay of our
UK employees at the 25th, 50th and 75th percentile, calculated by reference to 31 March 2022.
In line with last year’s calculation, the ratios have been calculated in accordance with Option A, as this is considered to be
the most accurate method of calculation.
CEO pay has been calculated using the total single igure. The total pay for the employees comprises full time equivalent
salary, beneits, pension and annual bonus payments relating to FY22 performance.
At 28.3:1, the median CEO pay ratio has increased for FY22 compared to FY21; this is primarily due to a bonus being paid
in FY22, compared to FY21 where no bonus was paid out.
The Committee is satisied the ratios are representative of Motorpoint’s pay and reward policies.
Relative importance of spend on pay
The following table sets out the percentage change in sta costs, dividends paid and share buyback in FY22 compared to
the prior year.
FY21
(£m)
FY22
(£m)
Percentage
change
Total employee remuneration 25.6 34.7 36%
Dividends paid 0 0 0%
Share buyback 0 0 0%
Statement of shareholder voting (2021 AGM voting)
The following table shows the voting results at the Company’s 2021 AGM in respect of the resolution on the Remuneration
Report for FY21 and the voting results at the 2020 AGM in respect of the resolution to approve the current Directors’
Remuneration Policy.
Votes cast % votes for
% votes
against
Votes
withheld
Directors’ Remuneration Report FY21 95.1 4.9 0
Directors’ Remuneration Policy FY20 93.1 6.9 37,500
Implementation of the Policy in FY23
A summary of how the remuneration policy will be applied during the forthcoming inancial year is set out below.
Base salaries
Salaries will be increased in line with the average increase for the workforce for FY23.
1 April 2021 1 April 2022
Percentage
change
Mark Carpenter £350,000 £360,500 3%
Chris Morgan £255,000 £262,650 3%
Beneits and pension
No changes are proposed to the provision of pension and beneits. Executive Directors will continue to receive family
private medical insurance, and a company car. Pension contributions (or cash in lieu of pension) will be 10% of salary for
the CEO and 3% of salary for the CFO. The CEO pension will reduce to the workforce rate at the end of this policy period.
Annual bonus
The structure of the annual bonus plan for FY23 has been updated to include the introduction of an environmental
measure, and to ensure personal targets are aligned with the Company’s strategic objectives. Executive Directors will be
eligible for an annual bonus payment up to a maximum of 100% of salary. Bonuses will be based on PBT, market share
growth, customer and employee engagement measures, and the number of electric vehicles sold compared to FY22,
with each measure awarded independently. Personal targets will be aligned to the Company’s goals, and include as
appropriate digitisation of the business and Auction4Cars.com. The Committee considers the forward looking targets
to be commercially sensitive as they relate to the current inancial year, but full disclosure of targets and performance
against them will be provided in next year’s Annual Report.
PBT is a inancial KPI for Motorpoint and is directly linked to our key strategic objective of delivering proitable earnings
growth by growing in our local markets, growing online sales and opening new branches. Our customers and employees
are two priority stakeholder groups, and ensuring high levels of customer satisfaction and employee engagement is key
to ensuring the success of our strategy and our Company.
Financial Statements
9998
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Annual report on remuneration continued
Long term incentives
Executive Directors will receive an award of Restricted Shares equal to 75% of base salary. The number of shares to be
granted will be determined with reference to the average of the closing middle market quotations of the shares during
the ive dealing days before the date of grant.
The shares will vest 50%, 25% and 25% at years three, four and ive, respectively, subject to the achievement of the
underpin. All awards would need to be held (other than sales to pay any tax) for a total of ive years from grant. In order
for Restricted Shares to vest, the Committee must be satisied that business performance is robust and sustainable and
that management has strengthened the business. In assessing this performance condition, the Committee will consider
inancial and non-inancial KPIs of the business as well as delivery against strategic priorities. To the extent it is not satisied
that this performance condition is met, the Committee may scale back the level of vested awards, including to zero. This
performance assessment will take place at the end of the third year.
Chair and Non-Executive Directors’ fees
The fees payable to the NEDs of the Company are as follows. The fees payable to the NEDs for FY23 will increase
from £40,000 to £45,000. This increase has been approved following a benchmarking survey undertaken by external
remuneration advisors, which demonstrated the previous rate was signiicantly below the market median for similar
sized businesses. The Chair of the newly formed ESG Committee will receive an additional fee for taking on this added
responsibility.
Non-Executive Chair £200,000
Other NEDs £45,000
Additional responsibility fees:
Chair of the Remuneration Committee £7,500
Chair of the Audit Committee £7,500
Chair of the ESG Committee £3,750
Senior Independent Director £5,000
In addition, as permitted under the Policy, Non-Executive Directors will have any reasonable expenses reimbursed
including any tax liability incurred.
Approval
This report was approved by the Board on 15 June 2022 and is signed on its behalf by:
Mary McNamara
Remuneration Committee Chair
15 June 2022
Directors’ report
The Directors present their report, together with the audited inancial statements of the Group and the Company,
for the year ended 31 March 2022.
The Directors’ report comprises the Board biographies (on pages 68 and 69), the Corporate Governance report
(frompage 70 to page 74), the Directors’ report (from page 99 to page 103) and the Shareholder information section
(onpage 149).
The following information is provided in other appropriate sections of the Annual Report and is incorporated by the
following references:
Information Reported in Page numbers
Likely future developments and performance
of the Company
Strategic report 10
Employee engagement Strategic report 33
SECR Strategic report 39
Stakeholder engagement Strategic report 32
Corporate Governance statement 70 - 74
Directors Board leadership and purpose 71
Remuneration report – Directors’ beneicial interests
and shareholding requirements 94
Viability Statement Strategic report 60
Details of Long Term Incentive Plan Remuneration report 93
Accounting policies Financial statements 116 - 123
Financial instruments Financial statements 134 - 137
Financial risk management Financial statements 134 - 137
Composition/operation of Board and committees Corporate Governance report 71 - 74
Articles of Association
Any amendments to the Company’s Articles of Association may only be made by passing a special resolution at a general
meeting of the shareholders of the Company.
Directors
The names of Directors who served during or served the end of the year of their period of appointment, are listed on
pages 68 and 69, together with details of each Director’s skills, experience and current external appointments.
Directors’ indemnities and insurance
The Company’s Articles of Association provide for the Directors and oicers to be appropriately indemniied subject to the
provisions of the Companies Act 2006. The Company also holds directors’ and oicers’ liability insurance cover in place
for the year and up to the date of signing this report.
Independent auditors
PricewaterhouseCoopers LLP acted as auditors throughout the year. In accordance with Section 489 and Section 492 of
the Companies Act 2006, resolutions proposing the reappointment of PricewaterhouseCoopers LLP as the Company’s
auditors and authorising the Directors to determine the auditor’s remuneration will be put to the 2022 AGM.
Donations and political expenditures
No political donations were made by the Company during the year and no contributions were made by the Company
during the year to any non-UK political party.
Financial Statements
101100
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Employees with disabilities
Motorpoint is an equal opportunities employer and our culture is one that promotes excellence and celebrates success.
We are committed to eliminating discrimination and encouraging diversity. We take pride in having a workplace which
celebrates diversity. Our aim is that our people will be truly representative of all sections of society and relect the diverse
customer base that we enjoy.
It is important that each person feels respected and is able to perform to the best of their ability – we do not tolerate any
form of discrimination and actively promote equal opportunities. Motorpoint proudly employs a number of people with a
registered disability and gives full and fair consideration to new applications for employment made by disabled persons;
this also includes internal promotions throughout the business. Our training and development interventions are available
to all sta and we ensure reasonable adjustments are made for new and existing team members, should they be required,
to accommodate their needs and deliver a safe and welcoming work environment.
This support applies throughout an employee’s career with us and should an individual ind their circumstances change
and they become disabled during their employment we would ensure total support and inclusion.
Research and development
The Company does not engage in research and development.
Existence of brands outside the UK
The Company has no branches outside the UK.
Workforce engagement
The Board recognises its various legal, iduciary, statutory and governance obligations and duties in relation to stakeholder
engagement, including those in respect of its own workforce. Mary McNamara, the Chair of Motorpoint’s Remuneration
Committee, is the designated Non-Executive Director with responsibility to engage with (and oversee engagement
with) employees and involve relevant views and experiences in Board discussion and decision making (the ‘Designated
NED for Workforce Engagement’). As the Designated NED for Workforce Engagement, Mary engages with (and
oversees engagement with) employees in ways that are most eective in discerning relevant views and understanding
theirexperiences.
The Company in January 2022 established its irst ever Board committee on ESG matters to ensure a dedicated forum
for stakeholder, including workforce, matters at Board level.
During the year, the Company has also endeavoured to encourage a founder mentality among its workforce and in
order to encourage greater participation in the Company’s Sharesave scheme, it increased the discount on the option
to purchase shares under that HMRC approved plan from 10% to 20%, the maximum permitted by HMRC.
Engagement with other stakeholders
In the discharge of their various legal, statutory and governance obligations and duties, the Directors have endeavoured
to act to promote the success of the Group for the beneit of its members as a whole, and in doing so have regard for the
interests of its various stakeholders. Details of the various stakeholder groups and their associated engagement strategies
are provided on page 32 of this report. The Board ensures, in its discussion of relevant matters, that stakeholder interests
are considered in related discussions and decision making processes and inform policies and procedures.
Substantial shareholdings
Information provided to the Company by substantial shareholders pursuant to the DTR is published via a Regulatory
Information Service. As at 31 March 2022, the Company has been notiied of the interests as set out below in its issued
share capital. All such share capital has the right to vote at general meetings.
Directors’ report continued
Shareholder as at 31 March 2022 No. of Ordinary Shares % of issued shares
Immersion Capital 17,647,958 19.57
abrdn 9,481,975 10.51
Mark Carpenter 8,881,693 9.85
Mark Morris 8,509,556 9.44
Forager Capital Management 4,378,870 4.86
Hunter Capital 3,283,401 3.64
Punch Card Capital LP 2,910,815 3.23
The Company received notiication on 25 April 2022 that Forager Capital Management had increased its holding to
4,516,370 ordinary shares (5.01%).
The shareholdings of Motorpoint Group Plc Directors are listed within the Directors’ Remuneration Report.
Powers of the Directors
The powers of the Directors are set out in the Companies Act 2006 and the Company’s Articles of Association. The
Directors were granted authority to issue and allot shares at the 2021 AGM. Shareholders will be asked to renew these
authorities in line with the latest institutional shareholder guidelines at the 2022 AGM.
Appointment and replacement of Directors
With regard to the appointment and replacement of Directors, the Company is governed by the Articles of Association
(the ‘Articles’), the 2018 Code, the Companies Act 2006 and related legislation. Directors can be appointed by the
Company by ordinary resolution at a general meeting, or by the Board. If a Director is appointed by the Board, such
Director will hold oice until the next AGM and shall then be eligible subject to Board recommendation, for election
at that meeting.
In accordance with Provision 18 of the 2018 Code, each of the Directors, being eligible, will oer themselves for election
or re-election at this year’s AGM (subject to any retirements). The Company can remove a Director from oice, either by
passing a special resolution or by notice being given by all the other Directors.
John Walden was appointed to the Board on 10 January 2022 as Non Executive Chair and Chair of the Nomination
Committee. His appointment and continuing membership of the Board are both subject to election at the Company’s
2022 AGM.
Dividends
No dividends (interim or inal) were paid, and no dividend is recommended by the Board.
Share capital
As at 31 March 2022, the Company’s issued share capital comprised 90,189,885 Ordinary Shares with a nominal value
of £0.01 each.
Ordinary Shares
The holders of Ordinary Shares are entitled to one vote per share at meetings of the Company. All Ordinary Shares, other
than those held from time to time in Treasury, are freely transferable and rank pari passu for voting and dividend rights.
The Company is not aware of any agreements between holders of shares that result in any restrictions.
Employee Beneit Trust
As at 31 March 2022, the Motorpoint Employee Beneit Trust held 1,372,677 Ordinary Shares (FY21: 34,841).
Further information about share capital can be found in note 28 of the Financial Statements.
Financial Statements
103102
Motorpoint Group Plc
Annual Report and Accounts 2022
GovernanceStrategic Report
Change of control provisions
The Directors are not aware of there being any signiicant agreements that contain any material change of control
provisions to which the Company is a party other than in respect of the inancing facility which expires in May 2024.
Under the terms of the facility, and in the event of a change of control of the Company, the bank can withdraw funding
and all outstanding loans, accrued interest and other amounts due and owing become payable within 30 days of the
change. No person holds securities carrying special rights regarding control of the Company.
Purchase of own shares
At the Company’s AGM on 27 July 2021, shareholders approved an authority for the Company to make market purchases
of its own shares up to a maximum of 9,018,988 shares (being approximately 10% of the issued share capital at that time)
at prices not less than the nominal value of each share (being £0.01 each). No use was made of this authority during the
period. The Company intends to renew this authority at its 2022 AGM.
Allotment of shares
At the Company’s AGM on 27 July 2021 shareholders approved an authority for the Company to allot ordinary shares up
to a maximum nominal amount of £300,632 (being approximately one third of the Company’s issued share capital at that
time) increasing to £601,265 (being approximately two thirds of the Company’s issued share capital at that time) in the
case of a rights issue. The Company intends to renew this authority at its 2022 AGM.
Acquisitions of other companies’ shares
The Company did not purchase or acquire the shares of another company in the year ended 31 March 2022; nor did any
nominee of the Company or another company do so with the Company’s inancial assistance; nor did the Company take
alien or other charge on shares of another company.
Subsequent events
After the year end, a sale and leaseback transaction was completed, relating to our site in Stockton-on-Tees. The freehold
was sold for £5.0m and leased back at an annual rent of £350k. There was no material proit or loss on this transaction.
Disclosure table pursuant to Listing Rule LR 9.8.4R
In accordance with LR 9.8.4R, the table below sets out the location of the information required to be disclosed,
where applicable.
Listing Rule Information to be included Disclosure
9.8.4(1) Interest capitalised by the Group. None.
9.8.4(2) Unaudited inancial information (LR 9.2.18R). None.
9.8.4(4) Long term incentive scheme information
involving Board Directors (LR 9.4.3R).
Details can be found on page 93 of the Directors’
Remuneration Report.
9.8.4(5) Waiver of emoluments by a Director. None.
9.8.4(6) Waiver of future emoluments by a Director. None.
9.8.4(7) Non-pre-emptive issues of equity for cash. None.
9.8.4(8) Non-pre-emptive issues of equity for cash
in relation to major subsidiary undertakings.
None.
9.8.4(9) Listed company is a subsidiary of another company. Not applicable.
9.8.4(10) Contracts of signiicance involving a Director
or a controlling shareholder.
None.
9.8.4(11) Contracts for the provision of services by
a controlling shareholder.
None.
9.8.4(12) Shareholder waiver of dividends. The trustees of the Motorpoint Group Plc Employee
Share Trust have a dividend waiver in place in respect
of Ordinary Shares which are its beneicial property.
9.8.4(13) Shareholder waiver of future dividends. The trustees of the Motorpoint Group Plc Employee
Share Trust have a dividend waiver in place in respect
of Ordinary Shares which are its beneicial property.
9.8.4(14) Agreement with controlling shareholder. None.
Directors’ report continued
Going concern
The inancial statements are prepared on a going concern basis. The Group regularly reviews market and inancial
forecasts and has reviewed its trading prospects in its key markets. During the year signiicant vehicle inlation impacted
stock valuations, and we accordingly negotiated increases in our stocking facilities from £106.0m at the start of year to
£195.0m by year end. The last tranche of this increase was £30.0m, and this was made available in the last week of the
inancial year. Accordingly, this was used in the early part of FY23 to reduce the utilised revolving credit facility balance
of £29.0m as at the year end. This revolving credit facility was increased by £15.0m during the year and replaced the
temporary £15.0m bank overdraft which expired earlier in May 2021.
In making their assessment the Directors considered the Group’s current balance sheet, and operational cash lows,
theavailability of facilities, and stress testing of the key trading assumptions within the Group’s plan.
For the purpose of considering going concern the Group focuses on a period of at least 12 months from the point
ofsigning the accounts.
The Board has taken a severe but plausible downside scenario approach in considering the going concern status of
the Group, reducing volumes and prices, and increasing interest rates and comparing with headroom available against
banking covenants and liquid resources required to continue trading. Taking the base case three-year forecast as the
starting point, even when applying a 25% reduction to revenue, as well as a substantial increase in interest costs, the
covenants were not breached, and liquid resources were not depleted. In this model, operating costs were not lexed
outside of built-in inlationary increases. However, in the event of a signiicant downturn, the Board would take mitigating
measures to reduce operating costs, which would create further headroom.
The Directors have made use of the post year end trading performance to provide additional insight into the continuing
viability of the business. While only a short period has passed since the year end, this evidence adds further comfort to the
continuing strength of the Group in an active market. Given the continued historical liquidity of the Group and suiciency
of reserves and cash in the stressed scenarios modelled, the Board has concluded that the Group has adequate resources
to continue in operational existence over the going concern period and into the foreseeable future thereafter. Accordingly,
they continue to adopt the going concern basis in preparing the consolidated inancial statements.
The Annual Report was approved by the Board on 15 June 2022.
On behalf of the Board
Chris Morgan
Chief Financial Oicer
15 June 2022
105104
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Statement of directors’ responsibilities
The directors are responsible for preparing the Annual
Report and Accounts and the inancial statements in
accordance with applicable law and regulation.
Company law requires the directors to prepare inancial
statements for each inancial year. Under that law the
directors have prepared the group inancial statements
in accordance with UK adopted international accounting
standards and the company inancial statements in
accordance with United Kingdom Generally Accepted
Accounting Practice (United Kingdom Accounting
Standards, comprising FRS 102 “The Financial Reporting
Standard applicable in the UK and Republic of Ireland”,
andapplicable law).
Under company law, directors must not approve the
inancial statements unless they are satisied that they
give a true and fair view of the state of aairs of the group
and company and of the proit or loss of the group for that
period. In preparing the inancial statements, the directors
are required to:
• select suitable accounting policies and then apply
them consistently;
• state whether applicable UK adopted international
accounting standards have been followed for the
group inancial statements and United Kingdom
Accounting Standards, comprising FRS 102 have been
followed for the company inancial statements, subject
to any material departures disclosed and explained in
the inancial statements;
• make judgements and accounting estimates that are
reasonable and prudent; and
• prepare the inancial statements on the going concern
basis unless it is inappropriate to presume that the
group and company will continue in business.
The directors are responsible for safeguarding the
assets ofthe group and company and hence for taking
reasonable steps for the prevention and detection of fraud
and other irregularities.
The directors are also responsible for keeping adequate
accounting records that are suicient to show and explain
the group’s and company’s transactions and disclose with
reasonable accuracy at any time the inancial position of
the group and company and enable them to ensure that
the inancial statements and the Directors’ Remuneration
Report comply with the Companies Act 2006.
The directors are responsible for the maintenance
and integrity of the company’s website. Legislation in
the United Kingdom governing the preparation and
dissemination of inancial statements may dier from
legislation in other jurisdictions.
Directors’ conirmations
The directors consider that the Annual Report and
Accounts and accounts, taken as a whole, is fair,
balancedand understandable and provides the
information necessary for shareholders to assess
thegroup’s and company’s position and performance,
business model and strategy.
Each of the directors, whose names and functions are
listed in the Board of Directors section of the Governance
report on pages 68 and 69 conirm that, to the best of
theirknowledge:
• the group inancial statements, which have been
prepared in accordance with UK adopted international
accounting standards, give a true and fair view of
theassets, liabilities, inancial position and proit of
thegroup;
• the company inancial statements, which have
been prepared in accordance with United Kingdom
Accounting Standards, comprising FRS 102, give a
true and fair view of the assets, liabilities and inancial
position of the company; and
• the Strategic Report includes a fair review of the
development and performance of the business and
theposition of the group and company, together with
adescription of the principal risks and uncertainties
that it faces.
In the case of each director in oice at the date the
directors’ report is approved:
• so far as the director is aware, there is no relevant
audit information of which the group’s and company’s
auditors are unaware; and
• they have taken all the steps that they ought to have
taken as a director in order to make themselves aware
of any relevant audit information and to establish
thatthe group’s and company’s auditors are aware
ofthat information.
Financial Statements
106 Independent auditors’ report
112 Consolidated statement of comprehensive
income
113 Consolidated balance sheet
114 Consolidated statement of changes
inequity
115 Consolidated cash low statement
116 Notes to the consolidated inancial
statements
141 Company balance sheet
142 Company statement of changes in equity
143 Notes to the Company inancial statements
147 Alternative performance measures
148 Glossary
149 Shareholder information and advisers
107106
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Independent auditors’ report
Opinion
In our opinion:
• Motorpoint Group Plc’s group
inancial statements and company
inancial statements (the “inancial
statements”) give a true and fair
view of the state of the group’s
and of the company’s aairs as at
31 March 2022 and of the group’s
proit and the group’s cash lows
for the year then ended;
• the group inancial statements
have been properly prepared in
accordance with UK-adopted
international accounting
standards;
• the company inancial statements
have been properly prepared
in accordance with United
Kingdom Generally Accepted
Accounting Practice (United
Kingdom Accounting Standards,
comprising FRS 102 “The Financial
Reporting Standard applicable in
the UK and Republic of Ireland”,
and applicable law); and
• the inancial statements have
been prepared in accordance
with the requirements of the
Companies Act 2006.
We have audited the inancial
statements, included within the
Annual Report and Accounts
2022 (the “Annual Report”), which
comprise: the Consolidated balance
sheet and Company balance sheet as
at 31 March 2022; the Consolidated
statement of comprehensive income,
Consolidated cash low statement,
Consolidated statement of changes
in equity and Company statement
of changes in equity for the year
then ended; and the notes to the
inancial statements, which include
a description of the signiicant
accounting policies.
Our opinion is consistent with our
reporting to the Audit Committee.
Report on the audit of the inancial statements
Basis for opinion
We conducted our audit in
accordance with International
Standards on Auditing (UK) (“ISAs
(UK)”) and applicable law. Our
responsibilities under ISAs (UK) are
further described in the Auditors’
responsibilities for the audit of
the inancial statements section
of our report. We believe that the
audit evidence we have obtained is
suicient and appropriate to provide
a basis for our opinion.
Independence
We remained independent of the
group in accordance with the ethical
requirements that are relevant to
our audit of the inancial statements
in the UK, which includes the FRC’s
Ethical Standard, as applicable to
listed public interest entities, and
we have fulilled our other ethical
responsibilities in accordance with
these requirements.
To the best of our knowledge and
belief, we declare that non-audit
services prohibited by the FRC’s
Ethical Standard were not provided.
Other than those disclosed in
note8to the inancial statements,
wehave provided no non-audit
services to the company or its
controlled undertakings in the
periodunder audit.
Our audit approach
Overview
Audit scope
• We conducted audit work over
Motorpoint Limited (the Group’s
trading company) and Motorpoint
Group Plc (the Company) which
together accounted for 100% of
the Group’s revenue and proit
before tax.
Key audit matters
• Inventory valuation (group)
• Recoverability of investment in
subsidiary undertakings (parent)
Materiality
• Overall group materiality:
£1,075,000 (2021: £845,000)
based on 5% of proit before tax
(2021: 5% of three year average
adjusted proit before tax).
• Overall company materiality:
£914,000 (2021: £720,000) based
on 1% of total assets, restricted by
component materiality allocation.
• Performance materiality:
£806,000 (2021: £634,000)
(group) and £686,000 (2021:
£540,000) (company).
The scope of or audit
As part of designing our audit, we
determined materiality and assessed
the risks of material misstatement in
the inancial statements.
Key audit matters
Key audit matters are those matters
that, in the auditors’ professional
judgement, were of most signiicance
in the audit of the inancial statements
of the current period and include
the most signiicant assessed risks
of material misstatement (whether
or not due to fraud) identiied by the
auditors, including those which had
the greatest eect on: the overall
audit strategy; the allocation of
resources in the audit; and directing
the eorts of the engagement team.
These matters, and any comments
wemake on the results of our
procedures thereon, were addressed
in the context of our audit of the
inancial statements as a whole, and
in forming our opinion thereon, and
we do not provide a separate opinion
on these matters.
This is not a complete list of all risks
identiied by our audit.
to the members of Motorpoint Group Plc
We tailored the scope of our audit
to ensure that we performed
enough work to be able to give an
opinion onthe inancial statements
as a whole, taking into account
the structure of the group and the
company, the accounting processes
and controls, and the industry in
which they operate.
The Group and all of its subsidiaries
are based in the UK. There is one
trading entity, Motorpoint Limited,
which has 17 retail sites, as at 31
March 2022, spread across the UK.
Motorpoint Limited and Motorpoint
Group Plc, the Company, were
considered to be signiicant
components, due to their contribution
to the Group inancial statements. Full
scope audits were carried out on both
of these components. The audit work
performed over Motorpoint Limited
and Motorpoint Group Plc gave us the
has considered the impact of climate
change risk on the impairment
assessment over non-current
assets and in the Group’s viability
assessment.
Materiality
The scope of our audit was inluenced
by our application of materiality. We
set certain quantitative thresholds
for materiality. These, together with
qualitative considerations, helped us
to determine the scope of our audit
and the nature, timing and extent of
our audit procedures on the individual
inancial statement line items and
disclosures and in evaluating the
eect of misstatements, both
individually and in aggregate on
the inancial statements as a whole.
Based on our professional judgement,
we determined materiality for the
inancial statements as a whole
as follows:
evidence we needed for our opinion
on the Group inancial statements
as a whole. These two entities cover
100% of the Group’s revenue and
proit before tax. All audit work was
completed by the Group audit team.
We made enquiries of management
to understand management’s process
for assessing climate-related risks and
opportunities, the extent of potential
impact of climate change risk on
the Group’s inancial statements
and the Group’s preparedness for
this. The Environmental, Social and
Governance report describes and
explains how climate change could
have an impact on the group’s
business. Using our knowledge of
the business we considered whether
the risks identiied by management
are materially complete and have
been appropriately estimated and
disclosed in the inancial statements.
We have assessed how the group
Recoverability of investment in subsidiary undertakings is a new key audit matter this year. Going concern and impairment
consideration relating to COVID-19, which was a key audit matter last year, is no longer included because of the risk in
respect of going concern and impairment has reduced, with all sites reopening and forecasts improving as the impact
of COVID-19 has decreased. Otherwise, the key audit matters below are consistent with last year.
Key audit matter How our audit addressed the key audit matter
Inventory valuation (group)
Refer to page 77 (Audit Committee report) and note 4 of the
consolidated inancial statements. Motorpoint’s provision
is based on historic data. Management’s assessment
involves a degree of judgement regarding historical data
being relective of future sales levels and margins. Given
the magnitude of inventory balances and the estimation
uncertainty as to the appropriate level of provision, there
is arisk that inventory is being carried in excess of net
realisable value.
• We have veriied the mathematical accuracy of
management’s models in calculating the inventory provision,
agreeing historical data used within the model.
• We have tested a sample of inputs used in management’s
models to appropriate third party evidence.
• We have challenged the time period of historical data used
within the calculation and sensitised the time period to
assess the impact.
• We have reviewed and challenged management’s forecast
margins post year end. We have reviewed sales since
the year end to understand margins achieved post year
end and assessed the impact of this on the remaining
population of unsold vehicles.
Based on our procedures, the carrying value of inventory
isconsistent with the evidence obtained.
Recoverability of investment in subsidiary undertakings (parent)
Refer to page 144, note 3 of the Company inancial
statements. As at 31 March 2022 the parent Company’s
balance sheet includes investments of £101.4m (FY21:
£101.3m). Annually, the Directors consider whether any
events or circumstances have occurred that could indicate
that the carrying amount of ixed asset investments may
not be recoverable. Management have not identiied any
indicators of impairment during the year.
We have considered whether there are any indicators
of impairment, including comparing to current market
capitalisation. No indicators were identiied. We consider
thecarrying value of investment in subsidiaries to be
materially correct.
How we tailored the audit scope
109108
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Independent auditors’ report continued
Financial statements – group Financial statements – company
Overall materiality £1,075,000 (2021: £845,000). £914,000 (2021: £720,000).
How we
determined it
5% of proit before tax (2021: 5% of three
year average adjusted proit before tax).
1% of total assets, restricted by component
materiality allocation.
Rationale for
benchmark
applied
We have applied this benchmark, a generally
accepted auditing benchmark, as we believe
that this is the key measure used by the
shareholders in evaluating the performance
of the group.
We have applied this benchmark, a generally
accepted auditing benchmark, as we believe
that this is the key measure used by the
shareholders in evaluating the performance
of the parent company.
For each component in the scope
of our group audit, we allocated
a materiality that is less than our
overall group materiality. The range
of materiality allocated across
components was between £917,000
and £1,021,000.
We use performance materiality
to reduce to an appropriately
low level the probability that the
aggregate of uncorrected and
undetected misstatements exceeds
overall materiality. Speciically, we
use performance materiality in
determining the scope of our audit
and the nature and extent of our
testing of account balances, classes
of transactions and disclosures, for
example in determining sample sizes.
Our performance materiality was
75% (2021: 75%) of overall materiality,
amounting to £806,000 (2021:
£634,000) for the group inancial
statements and £686,000 (2021:
£540,000) for the company inancial
statements.
In determining the performance
materiality, we considered a
number of factors - the history of
misstatements, risk assessment and
aggregation risk and the eectiveness
of controls - and concluded that
an amount at the upper end of our
normal range was appropriate.
We agreed with the Audit Committee
that we would report to them
misstatements identiied during
our audit above £50,000 (group
audit) (2021: £40,000) and £50,000
(company audit) (2021: £40,000) as
well as misstatements below those
amounts that, in our view, warranted
reporting for qualitative reasons.
least twelve months from when the
inancial statements are authorised
for issue.
In auditing the inancial statements,
we have concluded that the directors’
use of the going concern basis of
accounting in the preparation of the
inancial statements is appropriate.
However, because not all future
events or conditions can be
predicted, this conclusion is not a
guarantee as to the group’s and the
company’s ability to continue as a
going concern.
In relation to the directors’ reporting
on how they have applied the UK
Corporate Governance Code, we
have nothing material to add or draw
attention to in relation to the directors’
statement in the inancial statements
about whether the directors
considered it appropriate to adopt the
going concern basis of accounting.
Our responsibilities and the
responsibilities of the directors
with respect to going concern are
described in the relevant sections
of this report.
Reporting on other
information
The other information comprises
all ofthe information in the Annual
Report other than the inancial
statements and our auditors’ report
thereon. The directors are responsible
for the other information, which
includes reporting based on the Task
Force on Climate-related Financial
Disclosures (TCFD) recommendations.
Our opinion on the inancial
Conclusions relating
to going concern
Our evaluation of the directors’
assessment of the group’s and the
company’s ability to continue to
adopt the going concern basis of
accounting included:
• We reviewed the board approved
budget/ forecasts to support the
going concern assumptions and
impairment assessments;
• We assessed management’s
historical forecasting accuracy;
• We compared the budgets
and forecasts used in the
going concern and impairment
assessments to actual post year
end data;
• We challenged the key
assumptions used in
management’s models and
reviewed the downside models
to assess the impact on covenant
liquidity and impairment
headroom;
• We veriied the arithmetic
accuracy of management’s
models mentioned above; and
• We reviewed management’s
disclosures in relation to going
concern and found them to be
consistent with the modelling
performed.
Based on the work we have
performed, we have not identiied
any material uncertainties relating to
events or conditions that, individually
or collectively, may cast signiicant
doubt on the group’s and the
company’s ability to continue as
a going concern for a period of at
statements does not cover the
other information and, accordingly,
we do not express an audit opinion
or, except to the extent otherwise
explicitly stated inthis report, any
form of assurance thereon.
In connection with our audit of the
inancial statements, our responsibility
is to read the other information and, in
doing so, consider whether the other
information is materially inconsistent
with the inancial statements or
our knowledge obtained in the
audit, or otherwise appears to be
materially misstated. If we identify
an apparent material inconsistency
or material misstatement, we are
required to perform procedures
to conclude whether there is a
material misstatement of the
inancial statements or a material
misstatement of the other
information. If, based on the work we
have performed, we conclude that
there is a material misstatement of
this other information, we are required
to report that fact. We have nothing to
report based on these responsibilities.
With respect to the Strategic report
and Directors’ report, we also
considered whether the disclosures
required by the UK Companies Act
2006 have been included.
Based on our work undertaken in the
course of the audit, the Companies
Act 2006 requires us also to report
certain opinions and matters as
described below.
Strategic report and
Directors’report
In our opinion, based on the work
undertaken in the course of the
audit, the information given in the
Strategic report and Directors’ report
for the year ended 31 March2022
is consistent with the inancial
statements and has been prepared
in accordance with applicable
legalrequirements.
• The directors’ statement in
the inancial statements about
whether they considered it
appropriate to adopt the going
concern basis of accounting
in preparing them, and their
identiication of any material
uncertainties to the group’s and
company’s ability to continue
to do so over a period of at
least twelve months from the
date of approval of the inancial
statements;
• The directors’ explanation as to
their assessment of the group’s
and company’s prospects, the
period this assessment covers and
why the period is appropriate; and
• The directors’ statement as to
whether they have a reasonable
expectation that the company will
be able to continue in operation
and meet its liabilities as they
fall due over the period of its
assessment, including any related
disclosures drawing attention to
any necessary qualiications or
assumptions.
Our review of the directors’ statement
regarding the longer-term viability
of the group was substantially less
in scope than an audit and only
consisted of making inquiries and
considering the directors’ process
supporting their statement; checking
that the statement is in alignment
with the relevant provisions of the
UK Corporate Governance Code; and
considering whether the statement
is consistent with the inancial
statements and our knowledge and
understanding of the group and
company and their environment
obtained in the course of the audit.
In light of the knowledge and
understanding of the group and
company and their environment
obtained in the course of the audit,
we did not identify any material
misstatements in the Strategic
report and Directors’ report.
Directors’ Remuneration
In our opinion, the part of the
Remuneration Committee report
to be audited has been properly
prepared in accordance with the
Companies Act 2006.
Corporate governance
statement
The Listing Rules require us to review
the directors’ statements in relation
to going concern, longer-term
viability and that part of the corporate
governance statement relating to
the company’s compliance with
the provisions of the UK Corporate
Governance Code speciied for our
review. Our additional responsibilities
with respect to the corporate
governance statement as other
information are described in the
Reporting on other information
section of this report.
Based on the work undertaken as
part of our audit, we have concluded
that each of the following elements
of the corporate governance
statement, included within the
Corporate governance report is
materially consistent with the inancial
statements and our knowledge
obtained during the audit, and we
have nothing material to add or
draw attention to in relation to:
• The directors’ conirmation that
they have carried out a robust
assessment of the emerging
and principal risks;
• The disclosures in the Annual
Report that describe those
principal risks, what procedures
are in place to identify emerging
risks and an explanation of how
these are being managed or
mitigated;
111110
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Independent auditors’ report continued
In addition, based on the work
undertaken as part of our audit, we
have concluded that each of the
following elements of the corporate
governance statement is materially
consistent with the inancial
statements and our knowledge
obtained during the audit:
• The directors’ statement that they
consider the Annual Report, taken
as a whole, is fair, balanced and
understandable, and provides
the information necessary for
the members to assess the
group’s and company’s position,
performance, business model
and strategy;
• The section of the Annual Report
that describes the review of
eectiveness of risk management
and internal control systems; and
• The section of the Annual Report
describing the work of the Audit
Committee.
We have nothing to report in respect
of our responsibility to report when
the directors’ statement relating to
the company’s compliance with the
Code does not properly disclose a
departure from a relevant provision of
the Code speciied under the Listing
Rules for review by the auditors.
Responsibilities for the
inancial statements and
the audit
Responsibilities of the directors
for the inancial statements
As explained more fully in
the Statement of directors’
responsibilities, the directors are
responsible for the preparation of the
inancial statements in accordance
with the applicable framework and for
being satisied that they give a true
and fair view. The directors are also
responsible for such internal control
as they determine is necessary to
enable the preparation of inancial
There are inherent limitations in the
audit procedures described above.
We are less likely to become aware
of instances of non-compliance
with laws and regulations that are
not closely related to events and
transactions relected in the inancial
statements. Also, the risk of not
detecting a material misstatement
due to fraud is higher than the risk
of not detecting one resulting from
error, as fraud may involve deliberate
concealment by, for example, forgery
or intentional misrepresentations,
or through collusion.
Our audit testing might include
testing complete populations of
certain transactions and balances,
possibly using data auditing
techniques. However, it typically
involves selecting a limited number
of items for testing, rather than
testing complete populations. We
will often seek to target particular
items for testing based on their size
or risk characteristics. In other cases,
we will use audit sampling to enable
us to draw a conclusion about the
population from which the sample
is selected.
A further description of our
responsibilities for the audit of the
inancial statements is located on
the FRC’s website at: www.frc.org.
uk/auditorsresponsibilities. This
description forms part of our
auditors’ report.
Use of this report
This report, including the opinions,
has been prepared for and only for
the 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.
compliance with laws and regulations
related to the Listing Rules, UK tax
legislation and Financial Conduct
Authority regulations, and we
considered the extent to which non-
compliance might have a material
eect on the inancial statements.
We also considered those laws and
regulations that have a direct impact
on the inancial statements such
as the Companies Act 2006. We
evaluated management’s incentives
and opportunities for fraudulent
manipulation of the inancial
statements (including the risk of
override of controls), and determined
that the principal risks were related
to posting of inappropriate journal
entries with unusual account
combinations to increase revenue
or reduce expenditure, and
management bias in accounting
estimates. Audit procedures
performed by the engagement
team included:
• Review of correspondence
with regulators;
• Enquiries of management
including consideration of
known or suspected instances
of non-compliance with laws
and regulations or fraud;
• Review minutes of meetings
held by those charged with
governance;
• Challenging assumptions
and judgements made by
management in their signiicant
accounting estimates to identify
potential management bias, in
particular in relation inventory
valuation; and
• Identifying and testing journal
entries, in particular any journal
entries posted with unusual
account combinations that
increase revenue or reduce
expenditure.
Other matter
In due course, as required by
the Financial Conduct Authority
Disclosure Guidance and
Transparency Rule 4.1.14R, these
inancial statements will form part of
the ESEF-prepared annual inancial
report iled on the National Storage
Mechanism of the Financial Conduct
Authority in accordance with the ESEF
Regulatory Technical Standard (‘ESEF
RTS’). This auditors’ report provides no
assurance over whether the annual
inancial report will be prepared using
the single electronic format speciied
in the ESEF RTS.
Mark Skedgel
(Senior Statutory Auditor)
for and on behalf of
PricewaterhouseCoopers LLP
Chartered Accountants and Statutory
Auditors
Birmingham
15 June 2022
statements that are free from material
misstatement, whether due to fraud
or error.
In preparing the inancial statements,
the directors are responsible for
assessing the group’s and the
company’s ability to continue as
a going concern, disclosing, as
applicable, matters related to going
concern and using the going concern
basis of accounting unless the
directors either intend to liquidate
the group or the company or to
cease operations, or have no
realistic alternative but to do so.
Auditors’ responsibilities for the
audit of the inancial statements
Our objectives are to obtain
reasonable assurance about whether
the inancial statements as a whole
are free from material misstatement,
whether due to fraud or error, and to
issue an auditors’ report that includes
our opinion. Reasonable assurance is
a high level of assurance, but is not a
guarantee that an audit conducted in
accordance with ISAs (UK) will always
detect a material misstatement when
it exists. Misstatements can arise from
fraud or error and are considered
material if, individually or in the
aggregate, they could reasonably be
expected to inluence the economic
decisions of users taken on the basis
of these inancial statements.
Irregularities, including fraud, are
instances of non-compliance
with laws and regulations. We
design procedures in line with our
responsibilities, outlined above, to
detect material misstatements in
respect of irregularities, including
fraud. The extent to which our
procedures are capable of detecting
irregularities, including fraud, is
detailed below.
Based on our understanding of the
group and industry, we identiied
that the principal risks of non-
Other required
reporting
Companies Act 2006
exception reporting
Under the Companies Act 2006
we are required to report to you if,
in our opinion:
• we have not obtained all the
information and explanations
we require for our audit; or
• adequate accounting records
have not been kept by the
company, or returns adequate for
our audit have not been received
from branches not visited by
us;or
• certain disclosures of directors’
remuneration speciied by law
are not made; or
• the company inancial statements
and the part of the Remuneration
Committee report to be audited
are not in agreement with the
accounting records and returns.
We have no exceptions to report
arising from this responsibility.
Appointment
We were irst appointed as auditors
of Motorpoint Limited by its
Directors on 18 September 2015
to audit the inancial statements
for the year ended 31 March 2015
and subsequently reappointed
on 29 February 2016 to audit the
inancial statements for the year
ended 31 March 2016. Following the
reorganisation of the group headed
by Motorpoint Holdings Limited
and the formation of Motorpoint
Group Plc, we were appointed by
the Directors of Motorpoint Group
Plc on 28 October 2016 to audit the
inancial statements for the year
ended 31 March 2017 and subsequent
inancial periods. The period of
total uninterrupted engagement is
8 years, covering the years ended
31March2015 to 31 March 2022.
113112
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Note
2022
£m
2021
£m
Revenue 6 1,322 .3 721.4
Cost of sales 7 (1,216. 0) (658.9)
Gross proit 106.3 62.5
Operating expenses 7 (81 .3) (4 9 . 9)
Operating proit 25 .0 12.6
Finance expense 11 (3. 5) (2 .9)
Proit before taxation 21.5 9 .7
Taxation 12 (4 . 6) (2.1)
Proit for the year 16.9 7. 6
Other comprehensive income and expenses:
Items that will not be reclassiied to proit or loss
Tax relating to items which will not be reclassiied to proit or loss 12 (0.2) –
Other comprehensive expense (0. 2) –
Total comprehensive income for the year attributable to equity
holders of the parent 16 .7 7. 6
Earnings per share attributable to equity holders of the parent
Basic 13 1 8 .7p 8.4p
Diluted 13 1 8 .7p 8.4p
The Group’s activities all derive from continuing operations.
The notes on pages 116 to 140 are an integral part of these consolidated inancial statements.
Consolidated statement of comprehensive income
For the year ended 31 March 2022
Consolidated balance sheet
As at 31 March 2022
Note
2022
£m
2021
£m
ASSETS
Non-current assets
Property, plant and equipment 16 10.9 1 6 .1
Right-of-use assets 17 46.7 4 3.6
Intangible assets 15 0.6 –
Deferred tax asset 18 1 .0 1. 2
Total non-current assets 59. 2 60.9
Current assets
Assets held for sale 20 9. 2 –
Inventories 19 228.4 128. 4
Trade and other receivables 21 13.6 7. 7
Current tax receivable 12 – 1.7
Cash and cash equivalents 22 7. 8 6 .0
Total current assets 25 9.0 14 3 .8
TOTAL ASSETS 318. 2 2 0 4 .7
LIABILITIES
Current liabilities
Trade and other payables, excluding contract liabilities 24 (19 3 . 8) (12 5 .7)
Borrowings 23 (2 9.0) –
Lease liabilities 17 (3.3) (2. 4)
Current tax liabilities 12 (0. 6) –
Provisions 25 (0 .1) (0.1)
Total current liabilities (2 26 . 8) (128 . 2)
Net current assets 32. 2 15 .6
Non-current liabilities
Lease liabilities 17 (4 9 . 5) (4 6. 9)
Provisions 25 (2 .5) (2 .0)
Total non-current liabilities (52 .0) (48.9)
TOTAL LIABILITIES (27 8.8) (1 7 7. 1)
NET ASSETS 39. 4 2 7. 6
EQUITY
Called up share capital 28 0. 9 0.9
Capital redemption reserve 29 0 .1 0 .1
Capital reorganisation reserve 30 (0 . 8) (0.8)
EBT reserve 31 (4 .7) (0.1)
Retained earnings 43.9 2 7. 5
TOTAL EQUITY 39. 4 2 7. 6
The consolidated inancial statements on pages 112 to 140 were approved by the Board of Directors on 15 June 2022 and
were signed on its behalf by:
M Carpenter C Morgan
Chief Executive Oicer Chief Financial Oicer
Motorpoint Group Plc
Registered number 10119755
115114
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Note
Called up
share capital
£m
Capital
redemption
reserve
£m
Capital
reorganisation
reserve
£m
EBT
reserve
£m
Retained
earnings
£m
Total
equity
£m
Balance at 1 April 2020 0.9 0.1 (0. 8) – 2 0.0 20. 2
Proit for the year – – – – 7. 6 7. 6
Other comprehensive income
for the year – – – – – –
Total comprehensive income
for the year – – – – 7. 6 7. 6
Transactions with owners in
their capacity as owners:
Share-based payments 34 – – – – 0. 2 0.2
EBT share purchases and
commitments 31 – – – (0 .4) – (0.4)
Share-based compensation
options satisied through the EBT 31 – – – 0.3 (0. 3) –
– – – (0 .1) (0 .1) (0. 2)
Balance at 31 March 2021 0.9 0 .1 (0 .8) (0 .1) 2 7. 5 2 7. 6
Proit for the year – – – – 16.9 16.9
Other comprehensive expense
for the year – – – – (0. 2) (0 . 2)
Total comprehensive income
for the year – – – – 1 6 .7 1 6.7
Transactions with owners in
their capacity as owners:
Share-based payments 34 – – – – 0.1 0 .1
EBT share purchases and
commitments 31 – – – (5 .0) – (5 .0)
Share-based compensation
options satisied through the EBT 31 – – – 0.4 (0. 4) –
– – – (4 . 6) (0 . 3) (4 . 9)
Balance at 31 March 2022 0. 9 0 .1 (0. 8) (4 .7) 43.9 39. 4
The notes on pages 116 to 140 are an integral part of these consolidated inancial statements.
Consolidated statement of changes in equity
For the year ended 31 March 2022
Note
2022
£m
2021
£m
Cash lows from operating activities
Cash (used in)/generated from operations 33 (5 . 5) 12.4
Interest paid on borrowings and inancing facilities (1 . 8) (1. 3)
Interest paid on lease liabilities (1 .7) (1 .6)
Income tax paid (2. 3) (2. 8)
Net cash (used in)/generated from operating activities (11 . 3) 6 .7
Cash lows from investing activities
Purchases of property, plant and equipment and intangible assets (6. 9) (3 . 6)
Proceeds from disposal of property, plant and equipment and right-of-use assets – 6 .1
Net cash (used in)/generated from investing activities (6. 9) 2.5
Cash lows from inancing activities
Payments to satisfy employee share plan obligations (5 .0) (0.4)
Repayment of leases (4 . 0) (3 .6)
Proceeds from/(repayment of) borrowings 29.0 (10.0)
Net cash generated from/(used in) inancing activities 20.0 (14 .0)
Net increase/(decrease) in cash and cash equivalents 1.8 (4 . 8)
Cash and cash equivalents at the beginning of the year 6.0 10. 8
Cash and cash equivalents at end of year 7. 8 6.0
Net cash and cash equivalents comprises: Cash at bank 7. 8 6.0
Consolidated cash low statement
For the year ended 31 March 2022
117116
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
(d) Basis of consolidation
The consolidated inancial statements incorporate the inancial statements of the Company, entities controlled by the Company
(its subsidiaries) and the Motorpoint Group Plc Employee Beneit Trust made up to 31 March each year.
A list of subsidiaries is disclosed in note 3 to the Company inancial statements.
The EBT is consolidated on the basis that the Company has control, thus the assets and liabilities of the EBT are included in the
Balance Sheet and shares held by the EBT in the Company are presented as a deduction from equity. The EBT has been solely set
up for the purpose of issuing shares to Group employees to satisfy awards under the various share-based schemes detailed in
note 34 and has no ability to access or use assets, or settle liabilities, of the Group.
Subsidiaries 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 aect 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. Intercompany transactions and balances between Group companies are
eliminated on consolidation.
(e) Segmental reporting
The Group has prepared segmental reporting in accordance with IFRS 8 ‘Operating Segments’. The Group’s chief operating
decision maker is considered to be the Board of Directors. During the year the information presented to the Board has changed
to relect the dierent product mix and rates of growth which are expected to continue in the future between the wholesale and
the retail revenue streams. Segmental information is presented on the same basis as the management reporting. An operating
segment is a component of the business where discrete inancial information is available and the operating results are regularly
reviewed by the Group’s chief operating decision maker to make decisions about resources to be allocated to the segment and
to assess its performance.
Operating segments are aggregated into reporting segments to combine those with similar characteristics.
The Group operates its omnichannel vehicle retailer oering through a branch network and separate inancial information is
prepared for these individual branch operations. These branches are considered separate ‘cash-generating units’ for impairment
purposes. However, it is considered that the nature of the operations and products is similar and they all have similar long term
economic characteristics and the Group has applied the aggregation criteria of IFRS 8. In addition, the Group operates an
independent trade car auction site oering a business-to-business entirely online auction market place platform which is assessed
by the Board as a separate operation and thus there are two reportable segments: retail and wholesale.
(f) Revenue recognition
Revenue represents amounts chargeable, net of value added tax, in respect of the sale of goods and services to customers.
Revenue is measured at the fair value of the consideration receivable, when it can be reliably measured, and the speciied
recognition criteria for the sales type has been met. The transaction price is determined based on periodically reviewed
prices and are separately identiied on the customer’s invoice. There are no estimates of variable consideration.
The transaction price for motor vehicles and motor related services is at fair value as if each of those products are
soldindividually.
(i) Sales of motor vehicles
Revenue from sale of motor vehicles is recognised when the control has passed; that is, when the vehicle has been collected by,
or delivered to, the customer. Payment of the transaction price is due immediately when the customer purchases the vehicle.
Sales of accessories, such as mats, are recognised in the same way.
(ii) Sales of motor related services and commissions
Motor related services sales include commissions on inance introductions, extended guarantees and vehicle asset protection as
well as the sale of paint protection products. Sales of paint protection products are recognised when the control has passed; that
is, the protection has been applied and the product is supplied to the customer.
Vehicle extended guarantees where the Group is contractually responsible for future claims are accounted for by deferring
the guarantee income received along with direct selling costs, and then releasing the income on a straight line basis over the
remaining life of the guarantee. Costs in relation to servicing the extended guarantee income are expensed to the statement of
comprehensive income as incurred. The Group has not sold any of these policies in the current or prior period but continues to
release income in relation to legacy sales.
Vehicle extended guarantees and asset protection (‘GAP insurance’) where the Group is not contractually responsible for future
claims, are accounted for by recognising the commissions attributable to Motorpoint at the point of sale to the customer.
Where the Group receives inance commission income, primarily arising when the customer uses third-party inance to purchase
the vehicle, the Group recognises such income on an ‘as earned’ basis.
The assessment is based on whether the Group controls the speciic goods and services before transferring them to the end
customer, rather than whether it has exposure to signiicant risks and rewards associated with the sale of goods or services.
1. General information
Motorpoint Group Plc (the ‘Company’) is incorporated and domiciled in the United Kingdom under the Companies Act2006.
The Company is a public company limited by shares and is listed on the London Stock Exchange; the address of the registered
oice is Champion House, Stephensons Way, Derby, England, United Kingdom, DE21 6LY. The consolidated inancial statements
of the Group as at and for the year ended 31 March 2022 comprise the Company, all of its subsidiaries and the Motorpoint Group
Plc Employee Beneit Trust (the ‘EBT’) as listed on page 144, together referred to as the ‘Group’. These inancial statements are
presented in pounds sterling because that is the currency of the primary economic environment in which the Group operates.
The principal activities of the Group and the nature of the Group’s operations are set out in the Strategic Report on pages 1 to 66.
2. Summary of signiicant accounting policies
The principal accounting policies applied in the preparation of these consolidated inancial statements are set out below.
The policies have been consistently applied to all years presented, unless otherwise stated.
(a) Basis of preparation
The consolidated inancial statements of the Group have been prepared and approved by the Board on a historical cost basis
except for assets held for sale and in accordance with UK-adopted International Accounting Standards and the requirements
of the Companies Act 2006 as applicable to companies reporting under those standards.
The preparation of inancial statements in conformity with IFRS requires the use of certain critical accounting estimates. It also
requires management to exercise its judgement in the process of applying the Group’s accounting policies. The areas involving a
higher degree of judgement or complexity, or areas where assumptions and estimates are signiicant to the consolidated inancial
statements, are disclosed in note 4.
(b) Going concern
The inancial statements are prepared on a going concern basis. The Group regularly reviews market and inancial forecasts and
has reviewed its trading prospects in its key markets. During the year signiicant vehicle inlation impacted stock valuations, and
we accordingly negotiated increases in our stocking facilities from £106.0m at the start of year to £195.0m by year end. Thelast
tranche of this increase was £30.0m, and this was made available in the last week of the inancial year. Accordingly, this was used
in the early part of FY23 to reduce the utilised revolving credit facility balance of £29.0m as at the year end. This revolving credit
facility was increased by £15.0m during the year and replaced the temporary £15.0m bank overdraft which expired earlier in
May2021.
In making their assessment the Directors considered the Group’s current balance sheet, and operational cash lows, the
availability of facilities, and stress testing of the key trading assumptions within the Group’s plan.
For the purpose of considering going concern the Group focuses on a period of at least 12 months from the point of signing
theaccounts.
The Board has taken a severe but plausible downside scenario approach in considering the going concern status of the Group,
reducing volumes and prices, and increasing interest rates and comparing with headroom available against banking covenants
and liquid resources required to continue trading. Taking the base case three-year forecast as the starting point, even when
applying a 25% reduction to revenue, as well as a substantial increase in interest costs, the covenants were not breached, and
liquid resources were not depleted. In this model, operating costs were not lexed outside of built-in inlationary increases.
However, in the event of a signiicant downturn, the Board would take mitigating measures to reduce operating costs, which
would create further headroom.
The Directors have made use of the post year end trading performance to provide additional insight into the continuing viability
of the business. While only a short period has passed since the year end, this evidence adds further comfort to the continuing
strength of the Group in an active market. Given the continued historical liquidity of the Group and suiciency of reserves
and cash in the stressed scenarios modelled, the Board has concluded that the Group has adequate resources to continue in
operational existence over the going concern period and into the foreseeable future thereafter. Accordingly, they continue to
adopt the going concern basis in preparing the consolidated inancial statements.
(c) New standards, amendments and interpretations
The Group has not early-adopted standards, interpretations or amendments that have been issued but are not mandatory for
31March 2022 reporting periods.
The following amended standards and interpretations eective for the current inancial year have been applied and have not
had a signiicant impact on the Group’s consolidated inancial statements in the current or future reporting periods and on
foreseeable future transactions.
• Interest Rate Benchmark Reform – Amendments to IFRS 7, IFRS 4 and IFRS 16;
• Amendments to UK and Republic of Ireland accounting standards UK’s exit from the European Union.
Notes to the consolidated inancial statements
119118
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
(j) Property, plant and equipment
Property, plant and equipment is stated at the cost less depreciation. The cost of property, plant and equipment includes directly
attributable costs. Depreciation is provided on tangible ixed assets so as to write o the cost or valuation, less any estimated
residual value, over their expected useful economic life as follows:
Asset class Depreciation method and rate
Land Nil
Freehold property 5% straight line
Short term leasehold improvements Lower of 20% straight line or remaining lease term
Plant and machinery 20% straight line
Fixtures and ittings 20% straight line
Oice equipment 20% – 33.3% straight line
Assets in the course of construction are recorded separately within property, plant and equipment and are transferred to the
appropriate classiication when complete and depreciated from the date they are brought into use.
The residual values of the assets and their useful lives are reviewed, and adjusted if appropriate, at each balance sheet date.
The carrying value of assets is reviewed for impairment if events or changes in circumstances suggest that the carrying value
may not be recoverable. Assets are written down to their recoverable amount if lower than their carrying value, and any
impairment is charged to the statement of comprehensive income.
Gains and losses on disposals are determined by comparing the proceeds with the carrying amount and are recognised in the
statement of comprehensive income within ‘other income’.
(k) Financial instruments
IFRS 9 requires an entity to recognise inancial assets and inancial liabilities in the Group’s Balance Sheet when the Group
becomes party to the contractual provisions of the instrument.
The Group classiies inancial instruments, or their component parts, on initial recognition as inancial assets, inancial liabilities
or equity instruments according to the substance of the contractual arrangements entered into.
An equity instrument is any contract that evidences a residual interest in the assets of the Group after deducting all of its liabilities.
Equity instruments issued by the Group are recorded as the proceeds received, net of direct issue costs.
Financial assets
Trade receivables are initially recognised when they originate. All other inancial assets are initially recognised when the Group
becomes a party to the contractual provisions of the instrument.
At initial recognition, the Group measures a inancial asset at its fair value plus, in the case of a inancial asset not at fair value
through proit or loss (‘FVPL’), transaction costs that are directly attributable to the acquisition of the inancial asset. Transaction
costs of inancial assets carried at FVPL are expensed in proit or loss. A trade receivable without a signiicant inancing
component is initially measured at the transaction price.
A inancial asset is classiied either as being measured subsequently at fair value (either through other comprehensive income or
through proit or loss), or measured at amortised cost. The classiication depends on the Group’s business model for managing
the inancial assets and the contractual terms of the cash lows.
All inancial assets of the Group are classiied as measured at amortised cost. Financial assets are not reclassiied subsequent
to their initial recognition unless the Group changes its business model for managing inancial assets.
A inancial asset is measured at amortised cost if it meets both of the following conditions and is not designated as at fair value
reported in proit or loss:
• it is held within a business model whose objective is to hold assets to collect contractual cash lows; and
• its contractual terms give rise on speciied dates to cash lows that are solely payments of principal and interest on the
principal amount outstanding.
Financial assets at amortised cost are subsequently measured at amortised cost using the eective interest method. The
amortised cost is reduced by impairment losses. Interest income, foreign exchange gains and losses, and impairments are
recognised in proit or loss. Any gain or loss on de-recognition is recognised in proit or loss.
The Group recognises loss allowances for Expected Credit Losses (‘ECL’) on inancial assets measured at amortised cost. ECL
are probability-weighted estimates of credit losses. Credit losses are measured as the present value of all cash shortfalls (i.e.the
dierence between the cash lows due to the Group in accordance with the contract and the cash lows that the Group expects
to receive). All trade receivable balances are assessed individually.
ECL are discounted at the eective interest rate of the inancial asset. Loss allowances for inancial assets measured at amortised
cost are deducted from the gross carrying amount of the assets.
Notes to the consolidated inancial statements continued
2. Summary of signiicant accounting policies continued
Products and services Nature, timing of satisfaction of performance obligations and signiicant payment terms
Sale of motor vehicles The Group sells nearly new vehicles and accessories to retail customers. Revenue is
recognised at the point the vehicle is collected by, or delivered to, the customer. The
satisfaction of the performance obligation occurs on delivery or collection of the product.
The Group also sells vehicles acquired through retail customer trade-ins to trade
customers through its website Auction4Cars.com. Vehicles do not leave the premises
until they are paid for in full and therefore the revenue and the proit are recognised at
the point of sale. The satisfaction of the performance obligation occurs on collection
of the vehicle.
The Group operates a return policy which is consistent with the relevant consumer
protection regulations. This is oered in the form of a free nationwide Home Delivery
service with a 14 day money back guarantee to all retail customers.
Sales of motor related services
and commissions
The Group receives commissions when it arranges inance, insurance packages, extended
warranty and paint protection for its customers, acting as agent on behalf of a limited
number of inance, insurance and other companies. For inance and insurance packages,
commission is earned and recognised as revenue when the customer draws down the
inance or commences the insurance policy from the supplier which coincides with the
delivery of the product or service. Commissions receivable for all motor related services
are paid typically in the month after the inance is drawn down. For extended warranty
and paint protection, the commission earned by the Group as an agent is recognised as
revenue at the point of sale on behalf of the Principal.
The Group oered an Extended Guarantee for either 12 or 24 months, which commenced
from the end of the manufacturer’s warranty period. The revenue is deferred until the
start of the policy period, and then released on a straight line basis over the policy term.
Any directly attributable costs from the sale (e.g. sales commission) are also deferred
and released over the same period. Customer claims are taken to the statement of
comprehensive income as they are incurred during the policy term.
(g) Dividend distribution
Dividend distribution to the Group’s shareholders is recognised as a liability in the Group’s inancial statements in the period which
the dividends are approved.
(h) Foreign currency
The Group’s functional and presentation currency is the pound sterling.
Foreign currency transactions are translated into the functional currency using the exchange rates prevailing at the dates of
the transactions or valuation where items are re-measured. Foreign exchange gains and losses resulting from the settlement of
such transactions and from the translation at year end exchange rates of monetary assets and liabilities denominated in foreign
currencies are recognised in the statement of comprehensive income.
(i) Intangible assets other than goodwill
Intangible assets with inite useful lives that are acquired separately are carried at cost less accumulated amortisation and
accumulated impairment losses. The estimated useful life and amortisation method are reviewed annually with the eect of any
changes being relected on a prospective basis.
Intangible assets acquired in a business combination and recognised separately from goodwill are initially recognised at their fair
value at the acquisition date. Subsequent to initial recognition, intangible assets acquired in a business combination are reported
at their initial fair value less amortisation and accumulated impairment losses.
Research costs are expensed as incurred. An intangible asset arising from development expenditure on a project is only
recognised if management considers that it is technically feasible and that there are suicient resources available to complete
the asset so that it will be available for use or sale, that it intends to complete and is able to sell or use the asset to generate future
economic beneits and that the costs of the development project can be measured reliably. Following the initial recognition of the
expenditure, the asset will be carried at cost less accumulated amortisation and impairment losses.
Amortisation is applied once the asset is available for use to write o the cost over the period which is expected to beneit from
the sale of the asset.
The annual amortisation rates applied to the Group’s intangible assets on a straight line basis are as follows:
Asset class Depreciation method and rate
IT Projects 20% straight line
121120
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
• the lease payments change due to changes in an index or rate or a change in expected payment under a guaranteed residual
value, in which cases the lease liability is re-measured by discounting the revised lease payments using the initial discount rate
(unless the lease payments change is due to a change in a loating interest rate, in which case a revised discount rate is used); or
• the lease contract is modiied and the lease modiication is not accounted for as a separate lease, in which case the lease
liability is re-measured by discounting the revised lease payments using a revised discount rate.
When the lease liability is re-measured, an equivalent adjustment is made to the right-of-use asset unless its carrying amount is
reduced to zero, in which case any remaining amount is recognised in proit or loss.
Right-of-use asset – initial recognition
The right-of-use asset comprises the initial measurement of the corresponding lease liability, lease payments made at or before
the commencement date, any dilapidation or removal costs, and any initial direct costs. They are subsequently measured at cost
less accumulated depreciation and impairment losses.
Where the Group has an obligation for costs to dismantle and remove a leased asset, restore the branch on which it is located
or restore the underlying asset to the condition required by the terms and conditions of the lease, a provision is recognised and
measured under IAS 37. The present value of these costs are included in the related right-of-use asset.
The right-of-use asset is presented as a separate line in the Balance Sheet.
Right-of-use asset – subsequent measurement
Right-of-use assets are depreciated over the shorter of the lease term and useful life of the underlying asset.
Impairment
The Group applies IAS 36 to determine whether a right-of-use asset is impaired and accounts for any identiied impairment loss as
described in the ‘Impairment – non-inancial assets’ policy. Variable rents that do not depend on an index or rate are not included
in the measurement of the lease liability and the right-of-use asset. The related payments are recognised as an expense in the
period in which the event or condition that triggers those payments occurs.
Sale and leaseback
A sale and leaseback transaction is where the Group sells an asset and immediately re-acquires the use of the asset by entering
into a lease with the buyer. A sale occurs when control of the underlying asset passes to the buyer. A lease liability is recognised,
the associated property, plant and equipment asset is de-recognised, and a right-of-use asset is recognised at the proportion of
the carrying value relating to the right retained. Any gain or loss arising relates to the rights transferred to the buyer.
(m) Inventory
Inventory is valued at the lower of cost and net realisable value, after due regard for slow moving vehicles.
Net realisable value is based on selling price less anticipated costs of completion and selling costs. When calculating an inventory
provision management considers the nature and condition of the inventory as well as applying assumptions around expected
saleability, determined on historic trading patterns.
Inventory cost is calculated using the speciic identiication method.
(n) Assets held for sale
Assets are classiied as held for sale if their carrying amount will be recovered principally through a sale transaction rather than
through continuing use and a sale is considered highly probable. They are measured at the lower of their carrying amount and fair
value less costs to sell, except for assets such as deferred tax assets, assets arising from employee beneits, inancial assets and
investment property that are carried at fair value and contractual rights under insurance contracts, which are speciically exempt
from this requirement.
An impairment loss is recognised for any initial or subsequent write-down of the asset to fair value less costs to sell. A gain is
recognised for any subsequent increases in fair value less costs to sell of an asset, but not in excess of any cumulative impairment
loss previously recognised. A gain or loss not previously recognised by the date of the sale of the asset is recognised at the date
of derecognition.
Assets are not depreciated or amortised while they are classiied as held for sale. Interest and other expenses attributable to the
liabilities of a disposal group classiied as held for sale continue to be recognised.
Assets classiied as held for sale are presented separately from the other assets in the balance sheet.
(o) Trade receivables
Trade receivables represent the principal amounts outstanding from inance companies in respect of the inanced element of
sales to customers for motor vehicle and related products. Trade receivables are recognised net of any provision for impairment.
The carrying value of certain inancial assets are measured on an expected credit loss approach. Trade and other receivables
do not contain a signiicant inancing element and therefore expected credit losses are measured using the simpliied approach
permitted by IFRS 9, which requires expected lifetime losses to be recognised from the initial recognition of the receivables.
(p) Cash and cash equivalents
Cash and cash equivalents include cash in hand and at bank, and deposits held at call with banks. Where applicable, bank
overdrafts are shown within borrowings in current liabilities.
2. Summary of signiicant accounting policies continued
At each reporting date, the Group assesses whether inancial assets carried at amortised cost are credit-impaired. A inancial
asset is ‘credit-impaired’ when one or more events that have a detrimental impact on the estimated future cash lows of the
inancial asset have occurred. The gross carrying amount of a inancial asset is written o (either partially or in full) to the extent
that there is no realistic prospect of recovery. This is generally the case when the Group determines that the debtor does not have
assets or sources of income that could generate suicient cash lows to repay the amounts subject to the write-o.
From time to time based on purchasing decisions the Group holds hedging instruments to hedge currency risks arising from its
activities. Hedging instruments are recognised at fair value. Any gain or loss on re-measurement is recognised in the statement
of comprehensive income. However, the treatment of gains or losses arising from hedging instruments which qualify for
hedge accounting depends on the type of hedge arrangement. The fair value of hedging instruments is the estimated amount
receivable or payable to terminate the contract determined by reference to the market prices prevailing at the balance sheet
date. A gain or loss in respect of an eective hedge of a net investment in an overseas operation is recognised directly in equity.
Any ineective portion of the hedge is recognised in the statement of comprehensive income. The Group currently has no hedge
arrangements and no gain or loss is recognised in proit or loss in administrative expenses.
Financial liabilities
Financial liabilities are classiied on initial recognition as either other inancial liabilities measured at amortised cost or at fair value
through proit or loss.
Osetting of inancial assets and liabilities
Financial assets and liabilities are oset and the net amount reported in the balance sheet when there is a legally enforceable
right to oset the recognised amounts and there is an intention to settle on a net basis or realise the asset and settle the liability
simultaneously. The legally enforceable right must not be contingent on future events and must be enforceable in the normal
course of business and in the event of default, insolvency or bankruptcy of the Group or the counterparty.
(l) Leases
The Group applies IFRS 16, using the following practical expedients permitted by the standard:
• reliance on previous assessments on whether leases are onerous;
• the accounting for operating leases with a remaining lease term of less than 12 months as at 1 April 2020 as short term
leases;and
• the use of hindsight in determining the lease term where the contract contains options to extend or terminate the lease.
The Group also elected not to reassess whether a contract is, or contains, a lease at the date of initial application. Instead,
for contracts entered into before the transition date the Group relied on its assessment made applying IAS 17 and IFRIC 4
‘Determining whether an Arrangement contains a Lease’.
Lease liability – initial recognition
The lease liability is initially measured at the present value of the lease payments that are not paid at the commencement date.
The lease payments are discounted at the Group’s incremental borrowing rate. The incremental borrowing rate is determined
based on a series of inputs including the risk free-rate based on Government bond rates in addition to speciic adjustments for
risk and security. Lease payments included in the measurement of the lease liability comprise:
• ixed lease payments (including in-substance ixed payments), less any lease incentives;
• variable lease payments such as those that depend on an index or rate (such as RPI), initially measured using the index
or rate at the commencement date;
• the amount expected to be payable by the Group under residual value guarantees;
• the exercise price of purchase options where the Group is reasonably certain to exercise the options; and
• payments of penalties for terminating the lease, if the lease term relects the exercise of an option to terminate the lease.
Break and extension options are included in leases to provide operational lexibility should the economic outlook for an asset
be dierent to expectations, and hence at commencement of the lease, break or extension options are not typically considered
reasonably certain to be exercised, unless there is a valid business reason otherwise.
The lease liability is presented as a separate line in the Consolidated Balance Sheet, split between current and non-current liabilities.
Lease liability – subsequent measurement
The lease liability is subsequently measured by increasing the carrying amount to relect interest on the lease liability (using the
eective interest method) and by reducing the carrying amount to relect the lease payments made.
Lease liability – re-measurement
The lease liability is re-measured where:
• there is a change in the assessment of exercise of a purchase option, in which case the lease liability is re-measured by
discounting the revised lease payments using a revised discount rate; or
Notes to the consolidated inancial statements continued
123122
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
The fair value determined at the grant date of the equity-settled share-based compensation is expensed on a straight line basis over
the vesting period, based on the Group’s estimates of equity instruments that will eventually vest. At each balance sheet date, the
Group revises its estimate of the number of equity instruments expected to vest as a result of the eect of non-market based vesting
conditions. The impact of the revision of the original estimates, if any, is recognised in the statement of comprehensive income such
that the cumulative expenses relect the revised estimate, with a corresponding adjustment to equity reserves.
SAYE share options granted to employees are treated as cancelled when employees cease to contribute to the scheme. This
results in accelerated recognition of the expenses that would have arisen over the remainder of the original vesting period.
Cash-settled share-based compensation to employees and others providing similar services is measured at the fair value of the
equity instruments at the grant date. A liability is recognised at the current fair value determined at each balance sheet date and
at settlement.
(x) Government grants
Grants are recognised only when there is reasonable assurance that the Group will comply with the conditions attached to them
and that the grants will be received. Grants that are receivable as compensation for expenses already incurred are recognised in
the statement of comprehensive income in the period in which they become receivable.
(y) Earnings per share (‘EPS’)
The Group presents basic and diluted EPS for its Ordinary Shares. Basic EPS is calculated by dividing the proit attributable to
Ordinary Shareholders by the weighted average number of Ordinary Shares outstanding during the year. For diluted EPS, the
weighted average number of Ordinary Shares is adjusted to assume conversion of all dilutive potential Ordinary Shares.
(z) Exceptional items
Material non-recurring items of income and expense are disclosed as ‘exceptional items’. Examples of items that may give rise to
disclosure as exceptional items include costs of major restructuring and reorganisation of the business, corporate reinancing and
restructuring costs.
3. Underlying proit measures
The Group’s chief operating decision maker is considered to be the Board of Directors. The Board of Directors measures the
overall performance of the Group by reference to the following non-GAAP measures:
• earnings before interest, tax, depreciation and amortisation (‘EBITDA’);
• operating proit before exceptional items (adjusted operating proit); and
• proit before taxation before exceptional items (adjusted proit before taxation).
The adjusted measures are applied by the Board of Directors to understand the earning trends of the Group and are considered
the most meaningful measures by which to assess the true operating performance of the Group. In the current and prior year
there are no exceptional items noted; however these underlying proit measures remain valid when considering earlier years.
4. Critical accounting estimates and judgements
The preparation of inancial statements requires the use of accounting estimates which, by deinition, will seldom equal the
actual results. Management also needs to exercise judgement in applying the Group’s accounting policies. This note provides
an overview of the areas that involved a higher degree of judgement or complexity, and of items which are more likely to be
materially adjusted due to estimates and assumptions turning out to be wrong. Detailed information about each of these
estimates and judgements is included in other notes together with information about the basis of calculation for each aected
line item in the inancial statements.
Inventory provisions (note 19): Inventories are stated at the lower of cost and net realisable value. As in previous years, a provision
is included where management feels net realisable value falls below cost. The level of provision is determined by management
estimates based on historical and forecast sales and potential net realisable value.
Signiicant judgements
IFRS 16 Lease term (note 17): The lease term is a signiicant component in the measurement of both the right-of-use asset and
lease liability. Where leases contain options to break, the Group has assumed that these are exercised, unless there is reasonable
certainty that the lease will be extended, and therefore the assumed duration for the liability is to the break point. Similarly, for
any extension options, these have not been assumed to be utilised unless there is reasonable certainty. Judgement is exercised
in determining whether there is reasonable certainty that an option to extend the lease or purchase the underlying asset will be
exercised, or an option to terminate the lease will not be exercised, when ascertaining the periods to be included in the lease
term. In determining the lease term, all facts and circumstances that create an economical incentive to exercise an extension
option, or not to exercise a termination option, are considered at the lease commencement date. The Group reassesses whether
it is reasonably certain to exercise an extension option, or not exercise a termination option, if there is a signiicant event or
signiicant change in circumstances.
Future possible cash outlows not included in the lease liability
Some leases contain break clauses or extension options to provide operational lexibility. Potential future undiscounted lease
payments not included in the reasonably certain lease term, and hence not included in lease liabilities, total £4.6m (FY21: £4.5m).
Future increases or decreases in rentals linked to an index or rate are not included in the lease liability until the change in cash
lows takes eect.
2. Summary of signiicant accounting policies continued
(q) Current and deferred tax
The tax expense for the period comprises current and deferred tax. Tax is recognised in the statement of comprehensive income,
except to the extent that it relates to items recognised in other comprehensive income or directly in equity.
The current tax charge is calculated on the basis of tax laws enacted or substantively enacted at the balance sheet date.
Deferred tax is recognised, without discounting, in respect of all temporary dierences arising between the treatment of certain
items for taxation and accounting purposes, which have arisen but not reversed by the balance sheet date. Deferred tax is
measured at the rates, based on the tax rates and law enacted or substantively enacted at the balance sheet date, that are
expected to apply in the periods when the timing dierences are expected to reverse.
Deferred tax assets are recognised only to the extent that it is probable that future taxable proits will be available against which
the temporary dierences can be utilised.
Deferred tax assets and liabilities are oset when there is a legally enforceable right to oset 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
same taxable entity or dierent taxable entities and there is an intention to settle the balances on a net basis.
(r) Trade payables
Trade payables are obligations to pay for goods or services that have been acquired in the ordinary course of business from
suppliers. Accounts payable are classiied as current liabilities if payment is due within one year or less. If not, they are presented
as non-current liabilities.
Trade payables are recognised initially at fair value and subsequently measured at amortised cost using the eective interest
method, unless the eect is immaterial.
(s) Stocking inance facilities
Stocking inance facilities, included within trade and other payables, are borrowings secured against the vehicle against which the
facility is drawn down. These are short term liabilities which are settled on the sale of a vehicle or a ixed maturity not greater than
150 days and as a result form part of the normal business operating cycle (see note 23 for more details). They are recognised initially
at fair value and subsequently measured at amortised cost using the eective interest method, unless the eect is immaterial.
(t) Share capital
Ordinary Shares are classiied as equity. Costs incurred in issuing equity are deducted from the equity instrument.
(u) Provisions
Provisions for making good obligations are recognised when the Group has a present legal or constructive obligation as a
result of past events, it is probable that an outlow of resources will be required to settle the obligation, and the amount can be
reliably estimated. Provisions are not recognised for future operating losses. Where there are a number of similar obligations,
the likelihood that an outlow will be required in settlement is determined by considering the class of obligations as a whole. A
provision is recognised even if the likelihood of an outlow with respect to any one item included in the same class of obligations
may be small.
Provisions are measured at the present value of management’s best estimate of the expenditure required to settle the present
obligation at the end of the reporting period. The discount rate used to determine the present value is a pre-tax rate that relects
current market assessments of the time value of money and the risks speciic to the liability. The increase in the provision due to
the passage of time is recognised as interest expense.
(v) Borrowings
Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at
amortised cost using the eective interest rate method. The eective interest rate method is a method of calculating the
amortised cost and allocating the interest cost over the relevant period.
The eective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the
inancial instrument.
(w) Employee beneits
(i) Pensions
The Group operates a deined contribution pension scheme for employees. The assets of the scheme are held separately from
those of the Group. The annual contributions are charged in the statement of comprehensive income in the year in which they
become payable in accordance with the rules of the scheme.
(ii) Other employee beneits
The Group recognises an expense for other short-term employee beneits, primarily holiday pay and employee commissions
and bonuses on an accruals basis.
(iii) Share-based compensation
Equity-settled share-based compensation to employees and others providing similar services are measured at the fair value
of the equity instruments at the grant date. The estimate is measured using the Black-Scholes pricing model and excludes the
eect of non-market based vesting conditions. Details regarding the determination of the fair value of equity-settled share-based
transactions are set out in note 34.
Notes to the consolidated inancial statements continued
125124
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
The Group recognises the following accrued income balances:
2022
£m
2021
£m
Accrued income
Commissions
1
0.1 0.4
0.1 0.4
1 Accrued income relates to commissions earned from inance companies received the following month.
The Group recognises the following deferred income balances within accruals and deferred income:
2022
£m
2021
£m
Deferred income
Vehicles invoiced not collected 3.9 3.3
Commissions received not earned 3.0 3.0
Total deferred income 6.9 6.3
7. Operating proit
Analysed as:
Operating proit include the eect of charging:
2022
£m
2021
£m
Inventory recognised as expense 1,210.7 654.9
Write down of inventories recognised as an expense 1.0 0.2
Employee beneit expense (note 9) 34.7 25.6
Depreciation of property, plant and equipment (note 16) and right-of-use assets (note 17) 7.3 5.7
Expense on short term and low value leases 0.4 0.2
Loss on disposal of property, plant and equipment – 0.1
Total expenses comprise:
2022
£m
2021
£m
Cost of sales 1,216.0 658.9
Operating expenses:
Selling and distribution expenses 28.6 13.9
Administrative expenses 52.7 36.0
Total operating expenses 81.3 49.9
Total expenses 1,297.3 708.8
Receipts associated with the Coronavirus Job Retention Scheme of £0.1m which related to April 2021 were repaid in full to HMRC
before the end of the year (FY21: £3.9m claimed).
8. Auditor’s remuneration
2022
£m
2021
£m
Auditor’s remuneration:
Fees payable for the audit of the parent Company and consolidated inancial statements 0.2 0.2
Fees payable for the audit of the Company’s subsidiaries – –
Fees payable for non-audit services – –
Total 0.2 0.2
Non-audit services relate to access to the auditor’s generic online accounting manual.
5. Segmental information
The Group has prepared segmental reporting in accordance with IFRS 8 ‘Operating Segments’. During the year the information
presented to the Board has changed to relect the dierent product mix and rates of growth which are expected to continue
in the future between the wholesale and retail revenue streams. Segmental information is presented on the same basis as the
management reporting.
(a) Description of segments and principal activities
The Group’s operating segments are determined based on the Group’s internal reporting to the Board. The performance of
operating segments is assessed by the Board on the basis of gross proit with all assets and liabilities assessed on a Group basis.
The Board examines the Group’s performance from a product perspective and has identiied two reportable segments of
itsbusiness:
• Retail – the Motorpoint brand is an omnichannel vehicle retailer oering nearly new cars that are under four years old or have
completed less than 30,000 miles. This segment also includes a range of commercial vehicles under the Motorpoint brand.
• Wholesale – Auction4Cars.com is an independent trade car auction site oering a business-to-business entirely online auction
market place platform allowing an eicient and quick route for sale of part exchange vehicles which do not fall into the nearly
new retail criteria and purchases direct from consumers.
(b) Segment gross proit
Retail
2022
£m
Retail
2021
£m
Wholesale
2022
£m
Wholesale
2021
£m
Total
2022
£m
Total
2021
£m
Gross proit
Revenue 1,112.3 593.8 210.0 127.6 1,322.3 721.4
Cost of sales (1,021.3) (539.7) (194.7) (119.2) (1,216.0) (658.9)
Gross proit 91.0 54.1 15.3 8.4 106.3 62.5
Transactions between operating segments are made on an arm’s length basis in a manner similar to those with third parties.
Cost of sales are speciic and therefore directly attributable to each segment. Operating and inancial expenses are not
segregated for internal reporting purposes and hence have not been disclosed here.
(c) Other proit and loss disclosures
There was no impairment charge or other signiicant non-cash item recognised in FY22 (FY21: £Nil).
(d) Segment assets and liabilities
Segment assets and liabilities are measured in the same way as in the inancial statements. No further disclosure has been
provided here, as internally assets and liabilities are not segregated for reporting purposes.
6. Revenue
Revenue has been analysed between the sale of goods and the sale of services below.
Revenue from the sale of motor vehicles is split in note 5 above. All other revenue below relates to the retail segment as deined
in note 5a.
2022
£m
2021
£m
Revenue analysis
Revenue from sale of motor vehicles 1,253.1 687.5
Revenue from motor related services and commissions 62.9 29.0
Revenue recognised that was included in deferred income at the beginning
of the year – Sale of motor vehicles 3.3 1.7
Revenue recognised that was included in deferred income at the beginning
of the year – Motor related services and commissions 3.0 3.0
Revenue recognised that was included in the contract liability balance at the beginning
of the year – Extended guarantee income – 0.2
Total revenue 1,322.3 721.4
The Group has no contract liabilities (FY21: £Nil).
Notes to the consolidated inancial statements continued
127126
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
12. Taxation
The tax charge in the statement of comprehensive income represents:
2022
£m
2021
£m
Current tax:
UK corporation tax 4.3 2.0
Adjustment in respect of prior years 0.3 –
Total current tax 4.6 2.0
Deferred tax:
Origination and reversal of temporary dierences 0.2 0.1
Impact of UK corporation tax rate change (0.2) –
Total deferred tax – 0.1
Total tax charge in the consolidated statement of comprehensive income 4.6 2.1
Reconciliation of the total tax charge
The tax charge in the statement of comprehensive income in the year diers from the charge which would result from the
standard rate of corporation tax in the UK of 19% (FY21: 19%):
2022
£m
2021
£m
Proit before taxation 21.5 9.7
Proit before taxation at the standard rate of corporation tax of 19% (FY21: 19%) 4.1 1.8
Tax eect of:
– Fixed asset dierences 0.3 0.3
– Expenses not deductible for tax purposes 0.1 –
– Adjustment in respect of prior years 0.3 –
– Re-measurement of deferred tax for changes in tax rates (0.2) –
Tax charge in the consolidated statement of comprehensive income 4.6 2.1
A tax payable balance of £0.6m (FY21: tax receivable balance of £1.7m) is included within current liabilities (FY21: current assets)
as a result of the timing of the payments on account to HMRC.
Amounts recognised directly in equity
2022
£m
2021
£m
Aggregate current and deferred tax arising in the reporting period and recognised
in other comprehensive income and directly debited or credited to equity:
– Deferred tax: Remeasurement of deferred tax for changes in tax rates (0.2) –
– Deferred tax: Adjustment in respect of prior years 0.4 –
Tax charge in the consolidated statement of comprehensive income 0.2 –
Factors aecting current and future tax charges
An increase in the UK corporation tax rate from 19% to 25% (eective 1 April 2023) was substantively enacted on 24 May 2021.
As at the balance sheet date of 31 March 2022 the deferred tax asset has been calculated based on these rates, relecting the
expected timing of reversal of the related temporary dierences (FY21: 19%).
9. Employees and Directors
The aggregate employee beneit expenses were as follows:
2022
£m
2021
£m
Employee beneit expenses:
Wages and salaries 30.8 22.1
Social security costs 3.2 2.7
Pension costs 0.6 0.6
Share-based compensation charge (note 34) 0.1 0.2
34.7 25.6
The average monthly number of employees (including Directors but excluding third party contractors) employed by the Group
was as follows:
2022
No.
2021
No.
Average number of people employed:
Sales and operations 589 517
Administration and support 291 252
880 769
Receipts associated with the Coronavirus Job Retention Scheme of £0.1m which related to April 2021 were repaid in full to HMRC
before the end of the year (FY21: £3.9m claimed).
10. Directors’ and key management remuneration
Key management has been identiied as the Directors of Motorpoint Group Plc.
2022
£m
2021
£m
Short term employee beneits 1.0 0.6
Share-based payment – –
Employer contributions paid to money purchase schemes – –
1.0 0.6
During the year the number of key management who were receiving beneits was 2 (FY21: 2).
In respect of the highest paid Director refer to page 91 of the Annual Report on Remuneration.
11. Finance expense
2022
£m
2021
£m
Interest on bank borrowings 0.3 0.2
Interest on stocking inance facilities 1.5 1.1
Other interest payable 1.7 1.6
Total inance expense 3.5 2.9
Notes to the consolidated inancial statements continued
129128
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
16. Property, plant and equipment
Land
£m
Freehold
property
£m
Short term
leasehold
improvements
£m
Plant and
machinery
£m
Fixtures
and ittings
£m
Oice
equipment
£m
Work in
progress
£m
Total
£m
Cost
At 1 April 2020 6.2 5.9 7.2 1.5 1.3 3.2 2.5 27.8
Additions – 2.0 0.3 0.1 0.5 0.2 0.5 3.6
Transfers – 2.2 0.1 – – – (2.3) –
Disposals and assets
classed as held for sale (0.9) (3.4) (0.4) (0.1) (0.1) (0.3) (0.2) (5.4)
At 31 March 2021 5.3 6.7 7.2 1.5 1.7 3.1 0.5 26.0
Additions – – 2.3 0.3 0.9 0.6 2.2 6.3
Transfers – – 0.8 0.4 0.4 0.4 (2.0) –
Disposals and assets
classed as held for sale (3.1) (6.7) – – – – (0.1) (9.9)
At 31 March 2022 2.2 – 10.3 2.2 3.0 4.1 0.6 22.4
Accumulated depreciation
At 1 April 2020 – 0.1 4.3 1.0 1.1 2.4 – 8.9
Provided during the year – 0.3 0.9 0.2 0.1 0.4 – 1.9
Disposals and assets held
for sale – (0.1) (0.4) (0.1) (0.1) (0.2) – (0.9)
At 31 March 2021 – 0.3 4.8 1.1 1.1 2.6 – 9.9
Provided during the year – 0.4 1.0 0.2 0.3 0.4 – 2.3
Disposals and assets held
for sale – (0.7) – – – – – (0.7)
At 31 March 2022 – – 5.8 1.3 1.4 3.0 – 11.5
Net book value
At 31 March 2022 2.2 – 4.5 0.9 1.6 1.1 0.6 10.9
At 31 March 2021 5.3 6.4 2.4 0.4 0.6 0.5 0.5 16.1
At 31 March 2020 6.2 5.8 2.9 0.5 0.2 0.8 2.5 18.9
The depreciation expense of £2.3m (FY21: £1.9m) has been recorded in operating expenses.
Under IAS 36, the Group performs an annual assessment as to the existence of impairment indicators. Management identiied
an indicator of impairment as a result of the general market conditions including interest rates, inlation and supply shortages,
which could have diering impacts at an individual site level. As such, an impairment assessment has been performed.
Recoverable amounts for cash-generating units are the higher of fair value less costs of disposal, and value in use. Future cashlow
projections are based on the Group’s internal forecasts and include modest ongoing performance improvement, including in the
newest branches. The Group considers these cashlows to be reasonable and conservative. Management estimates the risk-
adjusted discount rate using pre-tax rates that relect the current market assessment of the time value of money.
The impairment review results in every cash-generating unit showing a suiciency of future cashlows, so no impairment charge
has been made. The minimum headroom on any cash-generating unit is £4.4m (FY21: £1.4m).
The Group has carried out sensitivity analysis on the impairment tests using various reasonably possible scenarios based on
possible market movements. No reasonable changes in assumptions applied would result in an impairment.
The impairment review also includes performance of a high-level inancial review of the asset classes and cost categories likely to
be impacted most signiicantly by climate change. An exercise was undertaken as part of our inancial planning to ensure that our
climate-related risks and any associated costs had been considered when assessing the value of our assets and future cashlow
forecasts. An estimated impact of climate-related risks was included in the impairment review performed. Although there were
material costs anticipated as a result of climate-related risks, this did not result in any impairment being identiied.
13. Earnings per share
Basic and diluted EPS are calculated by dividing the earnings attributable to equity shareholders by the weighted average number
of Ordinary Shares during the year.
2022 2021
Proit attributable to Ordinary Shareholders (£m) 16.9 7.6
Weighted average number of Ordinary Shares in issue (‘000) 90,190 90,190
Basic EPS (pence) 18.7 8.4
Diluted weighted average number of Ordinary Shares in issue (‘000) 90,259 90,265
Diluted EPS (pence) 18.7 8.4
The dierence between the basic and diluted weighted average number of shares represents the dilutive eect of the currently
operating schemes and the vested but not yet exercised options. This is shown in the reconciliation below.
The shares for the PSP20 scheme, RSA21 and RSA22 have performance criteria which have not been met so the options are not
yet dilutive. There is a maximum of 1,142,392 additional options which have not been included in the dilutive calculation in relation
to these schemes. Further information is included in note 34.
2022 2021
Weighted average number of Ordinary Shares in issue (‘000) 90,190 90,190
Adjustment for share options (‘000) 69 75
Weighted average number of Ordinary Shares for diluted earnings per share (‘000) 90,259 90,265
14. Dividends
During the year no dividends were paid (FY21: £Nil).
The Board has not proposed a inal dividend (FY21: £Nil) for the year ended 31 March 2022.
15. Intangible asset
IT projects
£m
Total
£m
Cost and Net book value
At 1 April 2020 – –
Additions – –
Disposals – –
At 31 March 2021 – –
Additions 0.6 0.6
Disposals – –
At 31 March 2022 0.6 0.6
There was no amortisation charge during the year in respect of intangible assets (2021: £Nil).
The intangible assets balance comprises capitalised employee and third party costs incurred in relation to developing new
application programming interfaces between platforms used by the Group.
Notes to the consolidated inancial statements continued
131130
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
The total cash outlow for leases held as right-of-use assets in FY22 was £5.7m (FY21: £5.2m).
An expense on short term leases is also included of £0.4m (FY21: £0.2m).
There are no low value leases.
(c) The Group’s leasing activities and how these are accounted for
The Group leases various oices and retail branches. Rental contracts are typically made for ixed periods of three to 20 years,
but may have extension options.
Lease terms are negotiated on an individual basis and contain a range of dierent terms and conditions. The lease agreements
do not impose any covenants other than the security interests in the leased assets that are held by the lessor. Leased assets may
not be used as security for borrowing purposes.
Where leases contain options to break, the Group has assumed that these are exercised, unless there is reasonable certainty that
the lease will be extended, and therefore the assumed duration for the liability is to the break point. Similarly, for any extension
options, these have not been assumed to be utilised unless there is reasonable certainty.
Leases are recognised as a right-of-use asset and a corresponding liability at the date at which the leased asset is available for
use by the Group.
Lease payments to be made under reasonably certain extension options are also included in the measurement of the liability.
The lease payments are discounted using the interest rate implicit in the lease. If that rate cannot be readily determined, which is
generally the case for leases in the Group, the lessee’s incremental borrowing rate is used, being the rate that the individual lessee
would have to pay to borrow the funds necessary to obtain an asset of similar value to the right-of-use asset in a similar economic
environment with similar terms, security and conditions.
To determine the incremental borrowing rate, the Group:
• where possible, uses recent third-party inancing received by the individual lessee as a starting point, adjusted to relect
changes in inancing conditions since third party inancing was received;
• uses a build-up approach that starts with a risk-free interest rate adjusted for credit risk for leases held by the Group, which
does not have recent third party inancing; and
• makes adjustments speciic to the lease where relevant.
Lease payments are allocated between principal and inance cost. The inance cost is charged to proit or loss over the lease
period so as to produce a constant periodic rate of interest on the remaining balance of the liability for each period.
Right-of-use assets are depreciated over the shorter of the asset’s useful life and the lease term on a straight line basis.
There have been no lease payment breaks during the year.
Extension and termination options
Extension and termination options are included in a number of property and equipment leases across the Group. These are used
to maximise operational lexibility in terms of managing the assets used in the Group’s operations. The majority of extension and
termination options held are exercisable only by the Group and not by the respective lessor.
Impairment assessment
Management has completed an impairment review of the Group’s estate, using each Retail Branch as a cash-generating unit.
Recoverable amounts for cash-generating units are the higher of fair value less costs of disposal, and value in use. Further detail
can be found in note 16.
18. Deferred tax assets
The movement in deferred taxation assets and liabilities during the year, without taking into consideration the osetting of
balances within the same tax jurisdiction, is as follows:
Other temporary dierences
Accelerated
capital
allowances
£m
Other timing
dierences
£m
Total
£m
At 1 April 2020 1.2 0.1 1.3
Charged to the statement of comprehensive income (0.1) – (0.1)
At 31 March 2021 1.1 0.1 1.2
Charged to equity (0.2) – (0.2)
At 31 March 2022 0.9 0.1 1.0
Deferred tax of Nil (FY21: £0.4m) is expected to be recovered or settled within 12 months from the reporting date.
An increase in the UK corporation tax rate from 19% to 25% (eective 1 April 2023) was substantively enacted on 24 May 2021.
As at the balance sheet date of 31 March 2022 the deferred tax asset has been calculated based on these rates, relecting the
expected timing of reversal of the related temporary dierences (FY21: 19%).
17. Leases
The Group only acts as a lessee.
(a) Amounts recognised in the statement of inancial position
The balance sheet shows the following amounts relating to leases:
Land and
buildings
£m
Right-of-use assets
Balance at 1 April 2020 41.6
Additions to right-of-use assets 5.8
Depreciation charge (3.8)
Balance at 31 March 2021 43.6
Balance at 1 April 2021 43.6
Additions to right-of-use assets 8.1
Depreciation charge (5.0)
Balance at 31 March 2022 46.7
Land and
buildings
£m
Lease liabilities
Balance at 1 April 2020 45.4
Additions to lease liabilities 7.5
Repayment of lease liabilities (including interest element) (5.2)
Interest expense related to lease liabilities 1.6
Balance at 31 March 2021 49.3
Current 2.4
Non-current 46.9
Balance at 1 April 2021 49.3
Additions to lease liabilities 7.5
Repayment of lease liabilities (including interest element) (5.7)
Interest expense related to lease liabilities 1.7
Balance at 31 March 2022 52.8
Current 3.3
Non-current 49.5
A maturity analysis of lease liabilities based on undiscounted gross cash lows as at 31 March 2022 is reported in the table below;
2022
£m
2021
£m
Within one year 6.1 5.4
In the second to ifth years inclusive 22.3 20.6
After ive years 35.1 35.1
Total minimum lease payments 63.5 61.1
Interest charges (10.7) (11.8)
Lease liability 52.8 49.3
(b) Amounts recognised in the statement of comprehensive income
The statement of comprehensive income shows the following amounts relating to leases:
2022
£m
2021
£m
Depreciation charge of right-of-use assets
Buildings 5.0 3.8
Finance expense
Interest expense 1.7 1.6
Notes to the consolidated inancial statements continued
133132
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Net debt reconciliation
Borrowings
£m
Leases
£m
Sub-total
£m
Cash
£m
Total
£m
Net debt as at 1 April 2020 (10.0) (45.4) (55.4) 10.8 (44.6)
Cash lows 10.0 3.6 13.6 (4.8) 8.8
New leases – (7.5) (7.5) – (7.5)
Other changes
Interest expense (1.3) (1.6) (2.9) – (2.9)
Interest payments (presented as operating
cash lows) 1.3 1.6 2.9 – 2.9
Net debt as at 31 March 2021 – (49.3) (49.3) 6.0 (43.3)
Financing cash lows (29.0) 4.0 (25.0) 1.8 (23.2)
New leases – (7.5) (7.5) – (7.5)
Other changes
Interest expense (1.8) (1.7) (3.5) – (3.5)
Interest payments (presented as operating
cash lows) 1.8 1.7 3.5 – 3.5
Net debt as at 31 March 2022 (29.0) (52.8) (81.8) 7.8 (74.0)
24. Trade and other payables: amounts due within one year
2022
£m
2021
£m
Trade payables:
– Trade creditors 11.8 19.4
– Stocking inance facilities
1
147.0 89.2
Other taxes and social security: updated
– VAT payable 1.8 –
– PAYE/NI payable 1.0 0.7
Other creditors 0.1 –
Accruals and deferred income
2
32.1 16.4
193.8 125.7
1 Stocking inance facilities are provided from Black Horse Limited and Lombard North Central PLC. At 31 March 2022 the Group had £195.0m (FY21: £106.0m) of
stocking inance facilities available of which £147.0m (FY21: £89.2m) was drawn.
The stocking inance facility with Black Horse Limited was renegotiated in May 2019 and all borrowings are secured against the vehicle which the stocking inance facility is
drawn down against. During FY21 this facility was increased from £75.0m to £80.0m and during FY22 it was increased by an additional £40.0m to £120.0m. The inance is
repayable on the earlier of the sale of the respective vehicle or a latest date of between 90 and 150 days from date of drawdown of the facility amount. In FY21 the repayment
term was extended by 30 days for vehicles already on the scheme as at 18 March 2021. The facility bears interest at the rate of 1% over Finance House Base Rate.
The stocking inance facility with Lombard North Central PLC was negotiated in March 2019 and all borrowings are secured against the vehicle which the stocking
inance facility is drawn down against. The inance is repayable on the earlier of the sale of the respective vehicle or a latest date of between 90 and 120 days from
date of drawdown of the facility amount. In FY21 the repayment term was extended by 60 days for vehicles already on the scheme as at 4 February 2021 and during
FY22 the limit was increased from £29.0m to £75.0m on the same terms as the original agreement. The facility bears interest at the rate of 1.35% over the Sterling
Overnight Index Average (‘SONIA’) rate since 1 January 2022 when 7 day LIBOR rate was no longer published.
Interest expense in the year of £1.5m (FY21: £1.1m) has been recognised as a inance cost.
2 Included within accruals and deferred income is £3.9m (FY21: £3.3m) in relation to vehicles invoiced not collected at the reporting date and £3.0m (FY21: £3.0m)
of commissions received in advance.
Other than the stocking inance facilities payable, trade and other payables are all non-interest bearing.
Due to their short maturities, the fair value of current liabilities approximates to their book value and all are in sterling.
19. Inventories
2022
£m
2021
£m
Finished goods: New and used vehicles for resale 228.4 128.4
The replacement cost of inventories is not considered to be materially dierent from the above values.
Provisions against inventory total £2.5m (FY21: £1.4m).
Inventory with a carrying value of £147.0m (FY21: £89.2m) has been pledged as security for the stocking inance facilities where
funding has been drawn down on that inventory.
20. Assets held for sale
2022
£m
2021
£m
Land and buildings 9.2 –
Assets classiied as held for sale comprise land and buildings relating to the Group’s branches in Stockton on Tees and
Peterborough. For Peterborough, there was the intention to sell and leaseback the property as at the year end, with a buyer found
post year end, however, the transaction had not been completed at the date of signing. Further detail on the Stockton on Tees
transaction can be found in note 36 Post balance sheet events.
21. Trade and other receivables
Due within one year
2022
£m
2021
£m
Trade receivables
1
9.9 2.1
Other receivables – 0.5
VAT receivables – 3.7
Prepayments 3.6 1.0
Accrued income
2
0.1 0.4
13.6 7.7
1 Trade receivables are non-interest bearing and generally have a term of less than seven days. Due to their short maturities, the fair value of current trade and other
receivables approximates to their book value. Trade receivables represent amounts due from inancial institutions on the inanced element of vehicle sales to
customers. The maximum exposure to credit risk is the carrying amount. The Group has no provisions against trade receivables (FY21: £Nil).
2 Accrued income relates to commissions earned from inance companies.
None of the Group’s trade receivables or other receivables were past due or impaired (FY21: £Nil). Trade and other receivables
are valued at their book value which is equivalent to fair value and all are in sterling.
22. Cash and cash equivalents
2022
£m
2021
£m
Cash at bank and in hand 7.8 6.0
23. Borrowings
The Group’s available borrowings consist of an unsecured loan facility provided by Santander UK PLC, split between £6.0m
available as an overdraft and £29.0m available as a revolving credit facility. A temporary 12 month £15.0m overdraft facility was
agreed with Santander UK PLC in May 2020 to help support short term cash impacts, should it have been required during the
pandemic. This temporary £15.0m overdraft facility expired in May 2021 and subsequently a £29.0m revolving credit facility was
negotiated in January 2022. The revolving credit facility and the overdraft expire in May 2024. As at the reporting date £29.0m
of the revolving credit facility (FY21: £Nil) and £Nil of the overdraft (FY21: £Nil) was drawn down. The terms of the revolving credit
facility and overdraft require a full repayment for a period of at least one day or more in each inancial year and half year with no
less than one month between repayments.
The inance charge for utilising the facility is dependent on the Group’s borrowing ratios as well as the base rate of interest in
eect. During the year ended 31 March 2022 interest was charged at 1.4% (FY21: 1.4%) per annum. The interest charged for the
year of £0.3m (FY21: £0.2m) has been expensed as a inance cost.
Notes to the consolidated inancial statements continued
135134
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
(c) Funding and liquidity risk
The funding arrangements of the Group at the balance sheet date consisted primarily of the stocking inance facilities, trade
and other payables, as well as an unsecured loan facility provided by Santander UK PLC, split between £6.0m available as an
uncommitted overdraft and £29.0m available as a revolving credit facility. Further information regarding these arrangements is
included in note 23.
The Group monitors its risk to a shortage of funds using a long term business plan that considers the maturity of all of its inancial
liabilities and the projected cash lows from operations. The Group aims to have suicient committed borrowing facilities and
operating cash lows to cover its core long term requirements.
The maturity table that follows details the contractual, undiscounted cash lows (both principal and interest) for the Group’s
non-derivative inancial liabilities into relevant maturity groupings based on the remaining period at the balance sheet date to the
contractual maturity date. Interest payments have been calculated using the LIBOR rates at the period end, except where rates
had already been contracted.
2022
Within
180 days
£m
Between 180
days and
1 year
£m
Between
1 and 2 years
£m
Between
2 and 5 years
£m
Over
5 years
£m
Total
£m
Borrowings 29.0 – – – – 29.0
Stocking inance facilities 147.0 – – – – 147.0
Trade creditors and accruals 37.0 – – – – 37.0
Lease liabilities 3.0 3.0 5.9 16.5 35.1 63.5
216.0 3.0 5.9 16.5 35.1 276.5
2021
Within
180 days
£m
Within
1 year
£m
Between
1 and 2 years
£m
Between
2 and 5 years
£m
Over
5 years
£m
Total
£m
Borrowings – – – – – –
Stocking inance facilities 89.2 – – – – 89.2
Trade creditors and accruals 29.5 – – – – 29.5
Lease liabilities 2.7 2.7 5.4 15.2 35.1 61.1
121.4 2.7 5.4 15.2 35.1 179.8
(d) Capital market risk
The Group is subject to capital market risk, primarily in relation to changes in interest rates. The Group’s interest bearing inancial
liabilities are analysed as follows:
2022 2021
Floating
£m
Fixed
£m
Total
£m
Floating
£m
Fixed
£m
Total
£m
Sterling denominated 176.0 – 176.0 89.2 – 89.2
Total 176.0 – 176.0 89.2 – 89.2
At 31 March 2022 and 2021 the loating rate inancial liabilities comprise stocking inance facilities that bear interest at rates based
on Finance House Base Rate and a revolving credit facility which bears interest based on the Sterling Overnight Index Average
(‘SONIA’) rate since 1 January 2022 when the LIBOR rate was no longer published.
The following table demonstrates the sensitivity to a reasonably possible change in interest rates, with all other variables held
constant, to the Group’s results before tax. The Group’s equity would be impacted by this amount less tax at the prevailing rate.
Increase/
decrease in
basis points
2022
£m
2021
£m
Sterling +50 (0.9) (0.4)
Sterling -50 0.9 0.4
(e) Capital management
The Group’s objective when managing capital is to ensure adequate working capital for all operating activities and liquidity,
including a comfortable headroom to take advantage of shorter term opportunities, or to weather short term shocks. Secondly
the Group aims to operate an eicient capital structure to achieve the business plan. For these purposes the Group considers
capital to be shareholders’ equity, borrowings and stocking inance facilities.
Consistent with others in the industry the Group monitors capital through the following ratio: total net debt as per note 22 divided
by EBITDA.
25. Provisions
2022
£m
Current
2022
£m
Non-current
2022
£m
Total
2021
£m
Current
2021
£m
Non-current
2021
£m
Total
Make good provision
1
– 2.5 2.5 – 1.9 1.9
Onerous lease
2
0.1 – 0.1 0.1 0.1 0.2
0.1 2.5 2.6 0.1 2.0 2.1
Movements in each class of provision during the inancial year are set out below:
2022
£m
Make good
provision
1
2022
£m
Onerous
lease
2
2022
£m
Total
2021
£m
Make good
provision
1
2021
£m
Onerous
lease
2
2021
£m
Total
Carrying amount at start of year 1.9 0.2 2.1 1.9 0.4 2.3
Charged to statement of
comprehensiveincome:
– Additional provisions recognised 0.6 – 0.6 – – –
– Unwinding of discount – – – – – –
Amounts used during the year – (0.1) (0.1) – (0.2) (0.2)
Carrying amount at end of year 2.5 0.1 2.6 1.9 0.2 2.1
1 Make good provision
Motorpoint Group Plc is required to restore the leased premises of its retail stores to their original condition at the end of the respective lease terms. A provision has
been recognised for the present value of the estimated expenditure required to remove any leasehold improvements. These costs have been capitalised as part of
the cost of right-of-use assets and are amortised over the shorter of the term of the lease and the useful life of the assets.
The timing of the cash outlow relating to the make good provision is in line with the life of the relevant lease. The remaining term on existing leases ranges from 2 to
16 years with a weighted average of 10 years.
There is judgement associated with the potential cost of remediation of each property and estimated provisions have been based on the past experience of theGroup.
2 Onerous leases
The Group operates across a number of locations and if there is clear indication that a property will no longer be used for its intended operation, a provision may be
required based on an estimate of potential liabilities for periods of lease where the property will not be used at the end of the reporting period, to unwind over the
remaining term of the lease. The onerous lease is likely to be utilised for a period of 4 years.
26. Financial instruments and risk management
The principal inancial liabilities comprise inventory inance facilities, borrowings, and trade and other payables. The main purpose
of these inancial liabilities is to provide working capital funding for the Group. The main risks arising from inancial liabilities are
discussed further below. The principal inancial assets comprise trade and other receivables, and cash at bank and in hand. The
maximum exposure at the balance sheet date is the carrying value of the inancial assets as disclosed in this note.
(a) Credit risk
The Group trades predominantly with retail customers. Sales to such customers are for cash and/or part-exchange, often with
inance provided by a selected panel of inancial institutions. The majority of the Group’s sales are thus for cash or the remittances
of funds from inancial institutions, which is achieved in a short period after the sale. As such the Group does not consider that
it is exposed to credit risk from retail customers. Receivable balances are monitored on an ongoing basis with the result that
the Group’s exposure to bad debts is not considered to be signiicant. The maximum exposure is the carrying value amount as
disclosed in this note. There is no signiicant concentration of credit risk within the Group. As a consequence, the Directors are
satisied that the Group’s exposure to credit risk is acceptable.
With respect to credit risk arising from other inancial assets of the Group, which comprise cash and cash equivalents, the Group’s
exposure to credit risk arises from the default of counterparties, with a maximum exposure equal to the carrying amount of these
instruments. Default is deined as the risk of inancial loss to the Group if a customer or counterparty to a inancial instrument
fails to meet its contractual obligations. Counterparty credit risk is managed through the monitoring and active management
of counterparty balances.
(b) Foreign exchange risk
The Group is not exposed to a signiicant foreign exchange risk. In FY21 and FY22 there were no purchases of inventory from the
EU, or other overseas countries and no hedging contracts were entered into.
At 31 March 2022 if sterling had weakened/strengthened by 10% against the Euro, with all other variables held constant, the
recalculated post-tax proit for the year would therefore have been unchanged (FY21: unchanged) as a result of foreign exchange
losses/gains on the translation of euro-denominated trade payables.
Notes to the consolidated inancial statements continued
137136
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
2021
Other inancial
liabilities at
amortised cost
£m
Liabilities
not within
the scope
of IFRS 9
£m
Total
£m
Borrowings – – –
Trade creditors 19.4 – 19.4
Stocking inance facilities 89.2 – 89.2
Other taxes and social security – 0.7 0.7
Lease liabilities 49.3 – 49.3
Accruals and deferred income 10.1 6.3 16.4
168.0 7.0 175.0
Fair value hierarchy
Financial instruments carried at fair value are required to be measured by reference to the following levels:
• Level 1: quoted prices in active markets for identical assets or liabilities.
• Level 2: inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly
(i.e.as prices) or indirectly (i.e.derived from prices).
• Level 3: inputs for the asset or liability that are not based on observable market data (unobservable inputs).
The Group has no inancial instruments carried at fair value.
(h) Credit quality of inancial assets
As disclosed in note 21 the Group has no inancial assets that are past due or impaired. The Group’s inancial assets represent
balances due from a selected panel of inancial institutions that provide inance to the Group’s retail customers and cash and cash
equivalents held with banks. The Group has banking arrangements in place with Barclays Bank plc, Santander UK PLC and Lloyds
Bank plc, all of which have a Fitch credit rating of A+. The Group does not obtain credit ratings for its customers. Due to their short
maturities the expected credit loss on inancial assets is estimated at £Nil.
27. Post employment beneit obligations
The Group operates a deined contribution pension scheme. The pension cost charge for the year represents contributions
payable by the Group to the scheme and is disclosed in note 9. Contributions totalling £0.1m (FY21: £0.1m) were payable to the
scheme at the end of the year and are included in accruals.
28. Share capital
2022 2021
Number
‘000
Amount
£m
Number
‘000
Amount
£m
Allotted, called up and fully paid Ordinary Shares of 1p each
Balance at the end of the year 90,190 0.9 90,190 0.9
1 Share buyback
There has been no share buyback during FY21 and FY22.
Since the commencement of the current share buyback programme in 2019 as at 31 March 2022, 615,000 shares have been bought back and cancelled
representing 0.7% of the issued Ordinary Shares, at a cost of £1.8m.
There are currently no shares held in treasury for use to satisfy employee share plan obligations.
The Group does not have a limited amount of authorised capital.
29. Capital redemption reserve
The capital redemption reserve represents the purchase by the Group of its own shares and comprises the amount by which
distributable proits were reduced on these transactions in accordance with s733 of the Companies Act 2006. £Nil (FY21:
£Nil) wastransferred into the capital redemption reserve during the year in respect of shares purchased by the Group and
subsequently cancelled.
30. Capital reorganisation reserve
The capital reorganisation reserve represents the capital reduction in the nominal value of shares in Motorpoint Group Limited
(re-registered as Motorpoint Group Plc on 10 May 2016) from £1 to 1p.
26. Financial instruments and risk management continued
The funding arrangements of the Group at the balance sheet date consisted primarily of the stocking inance facilities, trade and
other payables, as well as an unsecured loan facility provided by Santander UK PLC, split between £6.0m available as an overdraft
and £29.0m available as a revolving credit facility. Further information regarding these arrangements is included in note 23.
There are certain covenants on the revolving credit and stocking facilities relating to a maximum debt to equity and interest rate
cover in respect of the Group consolidated inancial statements. The Group reviews covenant compliance on a monthly basis,
both retrospectively and prospectively. As discussed more in note 2 and 4, in a stressed scenario, it is possible the Group would
need to negotiate changes to the banking covenants but this is not considered plausible in the scenarios modelled.
At 31 March 2022 the Group had undrawn stocking inance facilities of £48.0m (FY21: £16.8m) and undrawn credit facilities of £6m
(FY21: £35.0m). The excess headroom as at the current period end includes the additional stocking facility agreed on 25 March
2022 and further information can be found in note 2.
Under the terms of the major borrowing facilities, the Group is required to comply with the following inancial covenants, terms
are deined within the Alternative performance measures section of the Glossary:
• the interest cover (EBITDA to borrowing costs) should not be less than 4:1
• adjusted leverage being the total net debt to adjusted EBITDA should not exceed 3:1
• the reported Net Worth
1
will not at any stage fall below the amount of £30.0m.
1 New covenant applicable from 1 December 2021 as a result of renegotiating the Black Horse stocking facility.
The Group has complied with these covenants as applicable throughout the reporting period. As at 31 March 2022, they were
108:1, 1:1 and £39.4m respectively (FY21: 62:1, 0:1 and not applicable respectively).
(f) Fair value estimation
The Group has no inancial assets or liabilities carried at fair value.
(g) Financial instruments by category
The Group’s inancial assets are all measured at amortised cost.
2022
Carrying value
£m
Trade receivables 9.9
Other receivables –
Accrued income 0.1
Cash and cash equivalents 7.8
17.8
2021
Carrying value
£m
Trade receivables 2.1
Other receivables 0.5
Accrued income 0.4
Cash and cash equivalents 6.0
9.0
The Group’s liabilities are classiied as follows:
2022
Other inancial
liabilities at
amortised cost
£m
Liabilities
not within
the scope
of IFRS 9
£m
Total
£m
Borrowings 29.0 – 29.0
Trade creditors 11.8 – 11.8
Stocking inance facilities 147.0 – 147.0
Other taxes and social security – 2.8 2.8
Lease liabilities 52.8 – 52.8
Other creditors 0.1 – 0.1
Accruals and deferred income 25.2 6.9 32.1
265.9 9.7 275.6
Notes to the consolidated inancial statements continued
139138
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Performance Share Plan
The Group operates a Performance Share Plan for Executive Directors and certain key senior managers.
Restricted Share Award (‘RSA’)
Restricted shares dier from performance shares in a way that the grant level is scaled back, but the vesting of the shares
is not subject to speciic future conditions (other than a performance underpin).
SAYE scheme
The Group operates a SAYE scheme for all employees under which employees are invited to subscribe for options over
the Company’s shares at an exercise price representing a 10% discount to the closing mid-market price the day before the
invitationdate.
Plan
Grant
date
Vesting
date
Lapse
date
Settlement
type
Number
of shares
granted
Fair value at
grant date
2
£
Exercise
price
£
Performance
criteria
SIP 27-Jun-16 27-Jun-19 N/A equity-settled 194,023 1.877 Nil No
SIP 22-Dec-17 22-Dec-20 N/A cash-settled 118,716 1.877 Nil No
FY17 PSP 23-Jun-16 22-Jun-19 23-Jun-26 equity-settled 596,659 2.300 Nil Yes
FY18 PSP 21-Jul-17 21-Jul-20 21-Jul-27 equity-settled 830,267 1.385 Nil Yes
FY19 PSP 20-Jul-18 1-Apr-21 20-Jul-28 equity-settled 323,303 2.420 Nil Yes
FY20 PSP (A) 22-Jul-19 22-Jul-21 22-Jul-29 equity-settled 203,620 2.204 Nil Yes
FY20 PSP (B)
1
22-Jul-19 22-Jul-22 22-Jul-29 equity-settled 412,022 2.204 Nil Yes
FY21 RSA (A) 24-Aug-20 24-Aug-23 24-Aug-30 equity-settled 199,333 2.480 Nil Yes
FY21 RSA (B) 24-Aug-20 24-Aug-23 24-Aug-30 equity-settled 37,877 2.480 Nil Yes
FY21 RSA (C) 24-Aug-20 24-Aug-24 24-Aug-30 equity-settled 18,938 2.447 Nil Yes
FY21 RSA (D) 24-Aug-20 24-Aug-25 24-Aug-30 equity-settled 18,938 2.336 Nil Yes
FY22 RSA (A) 16-Jun-21 16-Jun-24 16-Jun-31 equity-settled 297,013 1.907 Nil Yes
FY22 RSA (B) 16-Jun-21 16-Jun-24 16-Jun-31 equity-settled 82,589 1.907 Nil Yes
FY22 RSA (C) 16-Jun-21 16-Jun-25 16-Jun-31 equity-settled 41,295 1.688 Nil Yes
FY22 RSA (D) 16-Jun-21 16-Jun-26 16-Jun-31 equity-settled 41,295 1.494 Nil Yes
SAYE17 27-Dec-16 1-Feb-20 1-Aug-20 equity-settled 770,041 0.320 1.12 No
SAYE18 27-Dec-17 1-Feb-21 1-Aug-21 equity-settled 417,765 0.490 1.77 No
SAYE19 21-Dec-18 1-Feb-22 1-Aug-22 equity-settled 283,012 0.500 1.89 No
SAYE20 23-Dec-19 1-Feb-23 1-Aug-23 equity-settled 222,040 0.890 2.30 No
SAYE21 23-Dec-20 1-Feb-24 1-Aug-24 equity-settled 259,001 0.940 2.77 No
SAYE22 20-Dec-21 1-Feb-25 1-Aug-25 equity-settled 403,215 1.024 2.76 No
5,770,962
1 The current assumption of non-vesting conditions reduces the fair value to zero at the balance sheet date.
2 The fair value at grant date as disclosed above is prior to applying an assumption for the number of shares not expected to vest due to participants leaving the scheme.
SIP SAYE PSP RSA 2022 2021
FY22 FY21 FY22 FY21 FY22 FY21 FY22 FY21
Weighted
average
exercise
price
£
Number
of options
Weighted
average
exercise
price
£
Number of
options
Outstanding
at 1 April FY 55,173 63,045 586,484 581,604 962,361 1,459,519 268,1 78 – 0.74 1,872,196 0.55 2,104,168
Awarded – – 403,215 259,001 – – 462,192 275,086 0.82 865,407 1.34 534,087
Forfeited/
lapsed – – (153,677) (120,628) (526,923) (483,490) – (6,908) (0.52) (680,600) (0.41) (611,026)
Exercised (8,787) (7,872) (111,212) (133,493) – (13,668) – – (1.74) (119,999) (1.53) (155,033)
Outstanding
at 31 March
FY 46,386 55,173 724,810 586,484 435,438 962,361 730,370 268,178 0.79 1,937,0 0 4 0.74 1,872,196
Exercisable
at 31 March
FY 46,386 55,173 35,985 37,655 23,416 23,416 – – 0.60 105,787 0.57 116,244
The option pricing model used by the entity to value the shares in the period in which they were launched is the
Black-Scholesmodel.
The range of exercise prices of share options outstanding at the end of the period for SAYE plans is between £1.12 and £2.77
(FY21:£1.12 – £2.77). The exercise price for PSP and RSA share awards is £Nil (FY21: £Nil).
31. Employee beneit trust (‘EBT’) reserve
The EBT has an independent trustee and has been set up to satisfy awards which are exercised in accordance with the terms
of the various share-based schemes detailed in note 34.
At 31 March 2022 the EBT held 1,372,677 (FY21: 34,841) Ordinary Shares of 1p each in the Group, the market value of which
amounted to £4.7m (FY21: £0.1m). Details of outstanding share awards and options are shown in note 34.
The consideration paid for the Ordinary Shares of 1p each in the Group held by the EBT at 31 March 2022 and 31 March 2021 has
been shown as an EBT reserve and presented within equity for the Group. All other assets, liabilities, income and costs of the EBT
have been incorporated into the accounts of the Group.
The table below shows the movements in equity from EBT transactions during the year:
2022 2021
Number
‘000
Amount
£m
Number
‘000
Amount
£m
Shares purchased by the EBT in the year 1,449,048 5.0 183,494 0.4
Shares issued in respect of employee share schemes (111,212) (0.4) 165,093 (0.3)
Proceeds of £0.2m (FY21: £0.3m) were received on the exercise of share-based payments. The weighted average cost of shares
issued by the EBT was £0.4m (FY21: £0.3m).
Subsequent to the year end, employee share options over 3,808 (FY21: 6,721) shares had been exercised and had been satisied
by Ordinary Shares issued by the EBT.
32. Other commitments
Capital commitments
The Group had capital commitments of £Nil at 31 March 2022 (FY21: £Nil).
33. Cash low from operations
2022
£m
2021
£m
Proit for the year attributable to equity shareholders 16.9 7.6
Adjustments for:
Taxation charge 4.6 2.1
Finance costs 3.5 2.9
Operating proit 25.0 12.6
Share-based payments 0.1 0.2
Loss on disposal of property, plant and equipment and right-of-use assets – 0.1
Depreciation charge 7.3 5.7
Cash low from operations before movements in working capital 32.4 18.6
Increase in inventory (100.0) (16.6)
Increase in trade and other receivables (5.9) (3.3)
Increase in trade and other payables 68.0 13.7
Cash (used in) / generated from operations (5.5) 12.4
34. Share-based compensation
Share options are granted to Senior Executives and other individuals throughout the organisation. The Group currently operates
three share schemes and these are the Performance Share Plan (’PSP’), the Share Incentive Plan (‘SIP’) and the Save As You Earn
(‘SAYE’) schemes. During FY21 the Restricted Shares Award scheme (‘RSA’) was introduced, which operates under the rules of the
PSP scheme.
The total expense recognised immediately in proit and loss arising from equity-settled share-based payment transactions in the
year relating to the three schemes including associated national insurance (‘NI’) charges was £0.1m (FY21: £0.2m).
NI is being accrued, where applicable, at a rate of 15.05% which management expects to be the prevailing rate when the awards
are exercised, based on the share price at the reporting date. NI for the year ended 31 March 2022 relating to all awards was a
charge of £Nil (FY21: £Nil).
Share Incentive Plan
The Group operates a SIP under which an award was made available to all eligible employees following admission to the London
Stock Exchange in May 2016.
Notes to the consolidated inancial statements continued
141140
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
34. Share-based compensation continued
The assumptions used in the measurement of the fair value at grant dates of the SAYE scheme are as follows:
Share price
at grant date
£
Expected
volatility
%
Option
life years
Risk-free
rate
%
Dividend
yield
%
Non-vesting
condition
%
Fair value
per option
£
20 December 2021 3.45 43.6 3.0 1.3 1.63 27.1 0.75
23 December 2020 2.81 51.7 3.0 2.5 1.29 27.1 0.94
23 December 2019 2.89 37.5 3.0 2.5 3.00 27.1 0.89
21 December 2018 2.04 34.5 3.0 2.5 2.85 27.1 0.50
27 December 2017 1.97 34.3 3.0 2.5 2.85 27.1 0.49
27 December 2016 1.28 33.0 3.0 2.5 3.10 27.1 0.32
The maximum subscription oered is £3,600 (equivalent to £100 per month over the 36 month saving period). Contributions from
salary are made into a savings account and on maturity participants can exercise their option to buy shares at the discounted rate
with their saved contributions or have the funds returned to them.
Expected volatility is estimated by considering historic average share price volatility of the Motorpoint Group Plc share price at the
grant date. The requirement that an employee has to save in order to purchase shares under the SAYE is a non-vesting condition.
This feature has been incorporated into the fair value at grant date by applying a discount to the valuation obtained from the
Black-Scholes pricing model.
FY22 SAYE FY21 SAYE FY20 SAYE FY19 SAYE
Number
Option
exercise
price £ Number
Option
exercise
price £ Number
Option
exercise
price £ Number
Option
exercise
price £
Outstanding at 1 April 2021 – – 248,292 2.77 164,222 2.30 136,315 1.89
Awarded 403,215 2.76 – – – – – –
Forfeited (31,163) – (62,451) – (31,607) – (13,706) –
Vested/early exercise – – (432) – (1,251) – (86,624) –
Outstanding at 31 March 2022 372,052 – 185,409 – 131,364 – 35,985 –
The total charge in the year, included in administrative expenses, in relation to these awards was £0.1m (FY21: £0.1m).
The weighted average remaining contractual life of the outstanding share options based on the relevant vesting date as at the
year end is 1.6 years (FY21: 1.4 years).
35. Transactions and balances with related parties
There were no transactions with related parties other than Directors and key management. Their remuneration, including
share-based payment as detailed in note 10 to the Financial Statements, and their beneiciary owned shares, are detailed
in the Remuneration Committee Report on page 94.
36. Post balance sheet events
After the year end, a sale and leaseback transaction was completed, relating to our site in Stockton-on-Tees. The freehold was
sold for £5.0m and leased back at an annual rent of £350k. There was no material proit or loss on this transaction.
Notes to the consolidated inancial statements continued
Note
2022
£m
2021
£m
Assets
Non-current assets
Investments 3 101.4 101.3
Total non-current assets 101.4 101.3
Total assets 101.4 101.3
Liabilities
Current liabilities
Creditors: amounts falling due within one year 4 (52.1) (46.4)
Total current liabilities (52.1) (46.4)
Net current liabilities (52.1) (46.4)
Total liabilities (52.1) (46.4)
Net assets 49.3 54.9
Equity
Called up share capital 6 0.9 0.9
Capital redemption reserve 7 0.1 0.1
EBT reserve (4.7) –
Retained earnings
At 1 April 2021 and 2020 respectively 53.9 53.8
Loss for the year (0.3) (0.1)
Share-based payments 0.1 0.2
Share-based compensation options satisied through the EBT (0.7) –
53.0 53.9
Total equity 49.3 54.9
The notes on pages 143 to 146 are an integral part of these inancial statements.
The inancial statements on pages 141 to 146 were approved by the Board of Directors on 15 June 2022 and were signed on its
behalf by:
M Carpenter C Morgan
Chief Executive Oicer Chief Financial Oicer
Motorpoint Group Plc
Registered number 10119755
Company balance sheet
As at 31 March 2022
143142
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Called up
share
capital
£m
Capital
redemption
reserve
£m
EBT
reserve
£m
Retained
earnings
£m
Total
equity
£m
At 1 April 2020 0.9 0.1 – 53.8 54.8
Loss for the year – – – (0.1) (0.1)
Transactions with owners in their capacity as owners:
Share-based payments – – – 0.2 0.2
– – – 0.2 0.2
At 31 March 2021 0.9 0.1 – 53.9 54.9
Loss for the year – – – (0.3) (0.3)
Transactions with owners in their capacity as owners:
Share-based payments – – – 0.1 0.1
EBT share purchases and commitments – – (5.4) – (5.4)
Share-based compensation options satisied through
the EBT – – 0.7 (0.7) –
– – (4.7) (0.6) (5.3)
Balance at 31 March 2022 0.9 0.1 (4.7) 53.0 49.3
Company statement of changes in equity
For the year ended 31 March 2022
1. Summary of signiicant accounting policies
Motorpoint Group Plc (the ‘Company’) is incorporated and domiciled in the United Kingdom under the Companies Act 2006.
The Company is a public company limited by shares and is listed on the London Stock Exchange; the address of the registered
oice is Champion House, Stephensons Way, Derby, England, DE21 6LY. The principal activity of the Company is to provide the
services of the Directors to the Group and that of a holding company.
(a) Basis of preparation
These Company inancial statements for the year ended 31 March 2022 have been prepared in accordance with United Kingdom
accounting standards including FRS 102 and the Companies Act 2006. These inancial statements are prepared on a going
concern basis, under the historical cost convention. The accounting policies have been consistently applied to all the years
presented, unless otherwise stated.
The Directors of the Company are also Directors of Motorpoint Group Plc and have used the going concern principle on the
basis that the current proitable inancial projections and facilities of the consolidated Group will continue in operation for the
foreseeable future, being a period of at least 12 months from the date of this report. The Company is in a net current liability
position; however as Motorpoint Limited is a wholly owned subsidiary of the Company, those outstanding balances will not be
settled unless the Company has the means to repay. For further details of the going concern status of the Group see page 116.
The Company inancial statements have been prepared in sterling which is the functional and presentational currency of the
Company and have been presented in round £m.
As permitted under section 408 of the Companies Act 2006 an entity proit and loss is not included as part of the published
consolidated inancial statements of Motorpoint Group Plc.
(b) Critical accounting judgements
The preparation of the inancial statements requires management to exercise its judgement in the process of applying the Group
and Company accounting policies. The areas involving a higher degree of judgement or complexity for the Group are disclosed
in note 4 to the consolidated inancial statements. There are no critical estimates or judgements speciic to the Company.
(c) Investment in subsidiaries
Investments in subsidiaries are held at cost, less any provision for impairment. Annually, the Directors consider whether any events
or circumstances have occurred that could indicate that the carrying amount of ixed asset investments may not be recoverable.
If such circumstances do exist, a full impairment review is undertaken to establish whether the carrying amounts exceed the
higher of net realisable value or value in use. If this is the case, an impairment charge is recorded to reduce the carrying value of
the related investment. Where equity-settled share-based compensation is granted to the employees of subsidiary companies,
the fair value of the award is treated as a capital contribution by the Company and investments in subsidiaries are adjusted to
relect this capital contribution.
(d) Dividend distribution
Dividend distribution to the Company’s shareholders is recognised as a liability in the Company’s inancial statements in the
period in which the dividends are approved by the Company’s shareholders.
(e) Financial instruments
The Company is applying sections 11 and 12 of FRS 102 in respect of the recognition and measurement of inancial instruments.
Financial assets and inancial liabilities are recognised in the Company’s balance sheet when the Company becomes party to the
contractual provisions of the instrument.
The Company classiies inancial instruments, or their component parts, on initial recognition as inancial assets, inancial liabilities
or equity instruments according to the substance of the contractual arrangements entered into.
(f) Financial equity
An equity instrument is any contract that evidences a residual interest in the assets of the Company after deducting all of its
liabilities. Equity instruments issued by the Company are recorded as the proceeds received, net of direct issue costs.
(g) Financial liabilities
Financial liabilities are classiied on initial recognition as either other inancial liabilities measured at amortised cost or at fair value
through proit or loss.
(h) Share capital
Ordinary Shares are classiied as equity. Costs incurred in issuing equity are deducted from the equity instrument.
(i) Employee beneits
(i) Pensions
The Group operates a deined contribution pension scheme for employees. The assets of the scheme are held separately from
those of the Group. The annual contributions are charged in the statement of comprehensive income in the year in which they
become payable in accordance with the rules of the scheme.
(ii) Other employee beneits
The Group recognises an expense for other short-term employee beneits, primarily holiday pay and employee commissions and
bonuses on an accruals basis.
Notes to the Company inancial statements
145144
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
1. Summary of signiicant accounting policies continued
(iii) Share-based compensation
Equity-settled share-based compensation to employees and others providing similar services are measured at the fair value
of the equity instruments at the grant date. The estimate is measured using the Black-Scholes pricing model and excludes the
eect of non-market based vesting conditions. Details regarding the determination of the fair value of equity-settled share-based
transactions are set out in note 34 of the Group’s inancial statements.
The fair value determined at the grant date of the equity-settled share-based compensation is expensed on a straight line basis over
the vesting period, based on the Group’s estimates of equity instruments that will eventually vest. At each balance sheet date, the
Group revises its estimate of the number of equity instruments expected to vest as a result of the eect of non-market based vesting
conditions. The impact of the revision of the original estimates, if any, is recognised in the statement of comprehensive income such
that the cumulative expenses relect the revised estimate, with a corresponding adjustment to equity reserves.
SAYE share options granted to employees are treated as cancelled when employees cease to contribute to the scheme. This
results in accelerated recognition of the expenses that would have arisen over the remainder of the original vesting period.
Cash-settled share-based compensation to employees and others providing similar services is measured at the fair value of the equity
instruments at the grant date. A liability is recognised at the current fair value determined at each balance sheet date and at settlement.
(j) Exemptions for qualifying entities under FRS 102
FRS 102 allows certain disclosure exemptions. The Company has taken the exemptions under FRS 102 paragraphs 1.12 (b), (d)and
(e) from including the preparation of a cash low statement and disclosure in relation to share-based compensation and key
management compensation, since equivalent disclosures are included in the consolidated inancial statements of the Group
headed by Motorpoint Group Plc.
2. Employees and Directors
The Company has no employees other than Directors (FY21: none). Full details of the Directors’ remuneration and interests are set
out in the Remuneration Committee Report on pages 82 to 98.
There were no transactions with related parties other than Directors and key management remuneration including share-based
payment as detailed in note 10 to the consolidated inancial statements. The shares beneicially owned by the Directors of the
Company are detailed in the Remuneration Committee Report on page 94.
3. Investments
2022
£m
2021
£m
At 1 April 101.3 101.1
Share-based payment charge 0.1 0.2
At 31 March 101.4 101.3
At 31 March 2022 the Company had the following 100% owned subsidiary companies, all of whom are registered in England and
Wales. Motorpoint Limited is the only direct subsidiary.
Subsidiary undertaking Registered address Principal activity Registered number
Motorpoint Limited Champion House, Stephensons
Way, Derby, England, DE21 6LY
Motor vehicle retail 03482801
Chartwell Leasing Limited
1
Champion House, Stephensons
Way, Derby, England, DE21 6LY
Dormant 04100916
Auction 4 Cars Limited
1
Champion House, Stephensons
Way, Derby, England, DE21 6LY
Dormant 09603690
Motorpoint Group Plc
Employee Beneit Trust
2
12 Castle Street, Jersey, JE2 3RT Employee beneit scheme Not applicable
1 These subsidiary undertakings are entitled to exemptions under sections 476 and 480 of the Companies Act 2006 relating to dormant companies.
2 The EBT is consolidated in the inancial statements of the Group on the basis that the Company has control as detailed in note 2 to the consolidated inancialstatements.
Notes to the Company inancial statements continued
4. Creditors: amounts falling due within one year
2022
£m
2021
£m
Bank loans and overdrafts 29.0 –
Amounts owed to Group undertakings 23.1 46.4
52.1 46.4
Amounts due to Group undertakings are repayable on demand, unsecured and non-interest bearing. See note 9 for further details
on borrowings.
5. Financial instruments
Financial instruments utilised by the Company during the year ended 31 March 2022 may be analysed as follows:
2022
£m
2021
£m
Financial liabilities measured at amortised cost 52.1 46.4
52.1 46.4
Financial instruments included within current assets and liabilities (excluding cash) are generally short term in nature and
accordingly their fair values approximate to their book values.
The Company’s inancial liabilities are repayable on demand and therefore their fair value is equal to their book value.
6. Called up share capital
2022 2021
Number
’000
Amount
£m
Number
‘000
Amount
£m
Allotted, called up and fully paid Ordinary Shares of 1p each
Balance at the end of the year 90,190 0.9 90,190 0.9
1 There has been no share buyback during FY21 and FY22.
Since the commencement of the current share buyback programme in 2019 as at 31 March 2022, 615,000 shares have been bought back and cancelled
representing 0.7% of the issued Ordinary Shares, at a cost of £1.8m.
At 31 March 2022 the EBT held 1,372,677 (FY21: 34,841) Ordinary Shares of 1p each in the Company, the market value of which
amounted to £4.7m (FY21: £0.1m). Details of outstanding share awards and options are shown in note 34 of the consolidated
inancial statements.
The Company does not have a limited amount of authorised capital.
7. Capital redemption reserve
The capital redemption reserve represents the purchase by the Company of its own shares and comprises the amount by
which distributable proits were reduced on these transactions in accordance with s733 of the Companies Act 2006. £Nil (FY21:
£0.1m) was transferred into the capital redemption reserve during the year in respect of shares purchased by the Company and
subsequently cancelled.
8. Dividends
During the year no dividends were paid (FY21: £Nil).
The Board has not proposed a inal dividend (FY21: £Nil) for the year ended 31 March 2022.
9. Borrowings
The Group’s available borrowings consist of an unsecured loan facility provided by Santander UK PLC which is in place until
May 2024 and is split between £6.0m available as an uncommitted overdraft and £29.0m available as a revolving credit
facility. Further detail is available in note 23 of the consolidated Group inancial statements. The revolving credit facility and
the overdraft expire in May 2024. As at the reporting date £29.0m of the revolving credit facility (FY21: £Nil) and £Nil of the
overdraft (FY21: £Nil) was drawn down.
The inance charge for utilising the facility is dependent on the Group’s borrowing ratios as well as the base rate of interest in
eect. During the year ended 31 March 2022 interest was charged at 1.4% (FY21: 1.4%) per annum. The interest charged for the
year of £0.3m (FY21: £0.2m) has been expensed as a inance cost.
147146
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
10. Commitments and contingencies
Capital commitments
The Company had no capital commitments at 31 March 2022 (FY21: £Nil).
Contingencies
There are no disputes with any third parties that would result in a material liability for the Company.
The Company acts as guarantor over the Group’s £195.0m (FY21: £109.0m) stocking inance facilities with Black Horse Limited
and Lombard North Central PLC.
11. Related parties
During the year, a management charge of £1.1m (FY21: £0.8m) was received from Motorpoint Limited in respect of services rendered.
During the year Motorpoint Limited paid interest of £0.2m (FY21: £0.2m) on behalf of the Company.
On behalf of Motorpoint Group Plc, Motorpoint Limited paid Directors’ salaries and fees of £1.1m (FY21: £0.9m) during the year
and has recharged this to Motorpoint Group Plc.
At the year end the balance outstanding due to Motorpoint Limited totalled £23.1m (FY21: £46.4m).
The Company grants share awards to employees of Motorpoint Limited as detailed in note 34 to the consolidated inancial
statements. As a result, there was a share-based payment charge of £0.1m (FY21: £0.2m) as disclosed in the Company’s Statement
of Changes in Equity with a corresponding increase in Investments.
Notes to the Company inancial statements continued
Alternative performance measures ‘APMs’
Introduction
We assess the performance of the Group using a variety of alternative performance measures that are not deined under IFRS and
are therefore termed non-GAAP measures. The non-GAAP measures we use are: adjusted operating proit; adjusted PBT; adjusted
EBITDA, adjusted EPS; GP/adjusted overheads ratio; operating cash conversion; EBITDA and ROCE. The rationale for using these
measures, along with a reconciliation from the nearest measures prepared in accordance with IFRS, is presented below.
The APMs we use may not be directly comparable with similarly titled measures used by other companies.
GP/adjusted overheads ratio
We measure inancial performance based on our gross proit/adjusted overheads ratio. The calculation of this measure is
asfollows:
Year ended 31 March
2022
£m
2021
£m
Gross proit 106.3 62.5
Adjusted overheads (81.3) (49.9)
Gross proit/adjusted overheads 130.8% 125.3%
In the current and prior year adjusted overheads is equal to operating expenses as a result of there being no exceptional items.
Operating cash conversion
We also measure inancial performance based on operating cash conversion. The calculation of this measure is as follows:
Year ended 31 March
2022
£m
2021
£m
Cash (used in)/generated from operations (5.5) 12.4
Operating proit 25.0 12.6
Cash (used in)/generated from operations/operating proit (22.0)% 98.4%
EBITDA
Year ended 31 March
2022
£m
2021
£m
Proit before taxation 21.5 9.7
Finance expense 3.5 2.9
Depreciation 7.3 5.7
Amortisation – –
EBITDA 32.3 18.3
Return on capital employed (‘ROCE’)
A commonly used metric that can be used to compare performance to other inancial businesses. It measures the proit (i.e. return)
relative to the amount of capital employed. The higher the ROCE the greater the return for the capital employed in the business.
Year ended 31 March 2022 2021
Operating proit (£’m) 25.0 12.6
Average net assets (£’m) 33.5 23.9
ROCE (%) 74.6 52.7
149148
Motorpoint Group Plc
Annual Report and Accounts 2022
Strategic Report Financial StatementsGovernance
Shareholder information and advisersGlossary
Registered oice
Motorpoint
Champion House
Stephensons Way
Derby DE21 6LY
United Kingdom
Legal advisers
Pinsent Masons LLP
30 Crown Place
London EC2A 4ES
Registrar
Link Group
Unit 10
Central Square
29 Wellington Street
Leeds
LS1 4DL
Company number
10119755
Company secretary
Chris Morgan
Joint stock brokers
Numis Securities Limited
45 Gresham Street
London
EC2V 7QA
Financial PR
FTI Consulting
200 Aldersgate
Aldersgate Street
London EC1A 4HD
Tel: +44 20 3727 1000
Shore Capital Stockbrokers Limited
Bond Street House
14 Cliord Street
London W1S 4JU
Bankers
Santander UK PLC
2 Clumber Street
Nottingham NG1 3GA
Share listing
MOTR.L 1 pence Ordinary Shares are listed
on the London Stock Exchange and are the
only class of shares in issue
Financial calendar
27 July 2022
Early October 2022
Late November 2022
Annual General Meeting
Half Year Trading Update
Interim Results Announcement
Independent Auditor
PricewaterhouseCoopers LLP
One Chamberlain Square
Birmingham
B3 3AX
Shareholder enquiries
Our registrars will be pleased to deal with any questions regarding your shareholdings on 0333 300 1950 (calls are charged
at the standard geographic rate and will vary by provider) or email enquiries@linkgroup.co.uk. Alternatively, you can access
www.signalshares.com where you can view and manage all aspects of your shareholding securely including electronic
communications, account enquiries or address amendments.
Investor relations website
The investor relations section of our website, www.motorpointplc.com, provides further information for anyone interested in
Motorpoint. In addition to the Annual Report and Accounts and share price, Company announcements including the full year
results announcements are also published there.
Cautionary note regarding forward-looking statements
Certain statements made in this Report are forward-looking statements. Such statements are based on current expectations and
assumptions and are subject to a number of risks and uncertainties that could cause actual events or results to dier materially
from any expected future events or results expressed or implied in these forward-looking statements. They appear in a number
of places throughout this Report and include statements regarding the intentions, beliefs or current expectations of the Directors
concerning, amongst other things, the Group’s results of operations, inancial condition, liquidity, prospects, growth, strategies
and the business. Persons receiving this Report should not place undue reliance on forward-looking statements. Unless otherwise
required by applicable laws, regulations or accounting standards, Motorpoint Group Plc does not undertake to update or revise
any forward-looking statements, whether as a result of new information, future developments or otherwise.
Term Meaning
Adjusted basic Earnings per Share Earnings attributable to equity shareholders adjusted for Exceptional Items/
weighted average number of Ordinary Shares during the year
Adjusted EBITDA Earnings Before Finance Expense, Tax, Depreciation and Amortisation
adjusted for Exceptional Items
Adjusted diluted Earnings per Share Earnings attributable to equity shareholders adjusted for Exceptionals/
weighted average number of Ordinary Shares during the year adjusted
for dilutive share options
Adjusted Operating Costs Operating Expenses before Exceptionals
Adjusted Operating Proit Operating Proit before Exceptionals
Adjusted Overheads Operating Expenses before Exceptionals
Adjusted PBT Proit Before Tax before Exceptionals
AGM Annual General Meeting
APM Alternative Performance Measure
CAGR Compound Annual Growth Rate
Capital Employed Average of the opening and closing position of the year for Net Assets
adjusted for related party balances and legacy EBT liability
CEO Chief Executive Oicer
CFO Chief Financial Oicer
CJRS Coronavirus Job Retention Scheme
DEFRA Department for Environment, Food and Rural Aairs
DTR Disclosure Guidance and Transparency Rules
EBITDA Earnings Before Interest, Tax, Depreciation and Amortisation
EBT Employee Beneit Trust
EPS Earnings per Share
ESG Environmental, Social and Governance
FCA Financial Conduct Authority
FRC Financial Reporting Council
FTE Full Time Equivalent
GAAP Generally Accepted Accounting Practice
GP Gross Proit
GP/Adjusted Overheads Gross Proit/Operating Costs before Exceptionals
HMRC HM Revenue and Customs
IAS International Accounting Standards
IFRS International Financial Reporting Standards
INED Independent Non-Executive Director
IPO Initial Public Oering
LIBOR London Interbank Oered Rate
LTIP Long Term Incentive Plan
NBS New Bridge Street
NED Non-Executive Director
NI National Insurance
NPS Net Promoter Score
OEM Original Equipment Manufacturer
Operating Cash Conversion Cash generated from operations/operating proit
PBT Proit Before Tax
PCI Payment Card Industry
PCP Personal Contract Purchase
PSP Performance Share Plan
PwC PricewaterhouseCoopers LLP
ROCE Return On Capital Employed, being Operating Proit/Capital Employed
RSA Restricted Share Award
SAYE Save As You Earn
SECR Streamlined Energy and Carbon Reporting
SID Senior Independent Non-Executive Director
SIP Share Incentive Plan
Structural Debt Debt excluding stock inance facilities
VED Vehicle Excise Duty
150
Motorpoint Group Plc
Annual Report and Accounts 2022
Notes
Motorpoint Group Plc
Champion House
Stephensons Way
Derby
DE21 6LY
Motorpoint Group Plc Annual Report and Accounts 2022