The group’s accounts for the financial year ending 31 May 2020 were filed late. 

Sales slipped by 2.38% to £114.8m, while operating profit prior to exceptionals increased to £1.65m from £1.29m. 

Adjusted EBITDA increased from £5.1m to just under £8.1m. The figure was boosted by £6.44m in depreciation, up from £3.8m the prior year. 

Added value, the directors’ preferred measure of performance, rose by £135k to £69.9m. 

The pre-tax loss was £8.3m, up from £6.1m the prior year. 

Auditors Grant Thornton flagged the macro economic uncertainties around Brexit and Covid-19, and drew attention to the note in YM’s accounts “which describes material uncertainties relating to the forecast sales of the group over the 12 months from the date of approval of these financial statements and the continued availability of the bank facilities”.

YM’s directors have identified material uncertainties around projected new business growth for its packaging products, and expected contract wins in its traditional market sectors. 

The directors also noted that YM’s £17m invoice finance facility with Barclays had been renewed in February 2021 and would be up for renewal again in February 2022. They said they had no reason to believe it would not be renewed “on similar terms to those currently in place”. 

The 2019/20 financial year had previously been billed as the beginning of a turnaround for the group under a three-year plan, with chief financial officer Lee Richardson predicting earnings “substantially ahead of the prior year”.

YM said its performance was impacted by the Covid-19 pandemic in the second half, most particularly in March-May 2020, resulting in “significant reductions in volumes” as customers in high street retail and travel reduced or suspended their marketing activities. 

“Despite the effects of Covid-19 on performance during the year and through 2020 and into 2021, as a result of the group’s strong track record in winning new business, combined with the new products recently launched that will allow the group to broaden its product offering and enter new markets, the directors are confident that the group remains well positioned to deliver on its growth plans during future years,” the directors stated. 

“The directors believe that a partial, if not full recovery, will occur during the forecast period which will provide additional benefit to the financial projections.”

YM said its new recyclable packaging product could be used by online retailers and “fresh food distribution”, with the directors “very excited by the potential” for the new product. 

After the balance sheet date, £20.25m in shareholder loan notes were converted to ordinary share capital. 

The redemption date for £19m in senior loan notes owed to major backer Pricoa was pushed back by a further year, to September 2022. The interest rate has increased from 9% to 11%, charged quarterly. 

The senior loan notes have gone up by £3m on the prior year.

The redemption date for the subordinated loan notes of £13.5m, also with Pricoa, was also pushed back by another year, to March 2023. The interest rate on this loan is 17%, 14% quarterly and 3% rolled. The interest rate is unchanged. 

The accounts were signed off on 1 July and filed at Companies House on 3 July. Chief executive Stephen Goodman had previously told Printweek they were filed at the end of June. 

It’s not clear why the accounts took so long to file. YM Group is now nearly two months into the 2021/22 financial year. 

Regarding the financial year ended 31 May 2021, in his commentary Richardson said the results were currently being prepared and directors expected EBITDA to be “broadly in line” with 2019/20 “despite the full year adverse impact of the prolonged Covid-19 pandemic on trading performance”.

“During the year to 31 May 2021 the directors have taken action to re-align the cost base of the business, to reflect Covid-19 impacted activity levels. The full year effect of this exercise is expected to benefit performance during the forecast period,” he stated.