Tclarke Regulatory News (CTO)

Annual Report and Notice of AGM

T.Clarke plc, the building services group, has today published its Annual Report and Financial Statements for the group for the year ended 31 December 2010, together with the Notice of Annual General Meeting ('AGM') and shareholder proxy form. The AGM will be held at The Riverside Room, Savoy Place, 2 Savoy Place, London WC2R 0BL at 12 noon on Friday 13th May 2011.

Copies of the Notice of AGM, the proxy form and the Annual Report and Financial Statements for the group for the year ended 31 December 2010 have been posted to shareholders who have requested hard copies and will be available on T.Clarke's website www.tclarke.co.uk. Copies of the above documents have also been submitted to the National Storage Mechanism and will shortly be available for inspection at: www.Hemscott.com/nsm.do :

The group announced its preliminary results for the year ended 31 December 2010 on 18 March 2011. The preliminary results announcement included a condensed set of financial statements and extracts from the management report including the Business Review. That information, together with the Appendix to this announcement, which contains additional information which has been extracted from the Annual Report and Financial Statements for the year ended 31st December 2010, constitutes the material required for the purposes of compliance with the Disclosure and Transparency Rules and should be read together with the preliminary results announcement, which can be downloaded from the Company's website at www.tclarke.co.uk.

This announcement should be read in conjunction with and is not a substitute for reading the full Annual Report and Financial Statements. Page and note references in the appendix below refer to page numbers and notes in the Annual Report and Accounts. 

Date: 4th April 2011

For further information contact:

Appendix

A description of the principal risks and uncertainties that the group faces is included on pages 9 to 10 and page 14 of the 2010 Annual Report and Financial Statements, and is reproduced below:

"Principal risks and uncertainties

The main areas of uncertainty facing the group relate to market conditions, acquisitions, operational risk, cost inflation, people, health and safety. These are the main risk factors that could potentially impact the group's performance.

Market Conditions

The Board reported throughout 2010 that the markets in which it operates have been extremely difficult. The board has continued to take conservative assessments of final accounts from project completions and the likely outcome for a number of ongoing projects and repeatedly stated that it believes that the outlook for 2011 will continue to be challenging. During the current recession we moved quickly to align our cost base to a reduced workload. Further reductions could be undertaken if considered appropriate to reflect the market conditions. We enter 2011 with our business in great physical and financial shape and able to respond to future challenges and opportunities as they present themselves.

Acquisitions

Our strategy is to be able to offer the complete range of building services across the UK. We will sensibly consider appropriate opportunities that can advance this strategy both in terms of geographical coverage and services offered. Acquisitions involve a degree of risk; we aim to mitigate this via due diligence prior to acquisition, ensuring effective local management are in place and by the implementation of group reporting and internal control procedures.

Going forward in the shorter term we believe future growth will be best achieved by building upon the existing group structure and the services offered and by expanding our existing businesses into areas where we do not have a local presence.

Operational risk

We are continually assessing and managing operational risks through the bidding stage to the final commissioning of an installation and handover to the client. We have experienced teams of estimators and all bids are reviewed by a Director and checks are carried out to avoid incorrect or non-competitive pricing. Inadequate supervision would result in poor quality and low productivity, both of which would result in loss of reputation and profit. Our contract engineers, supervisors, surveyors and skilled trades people receive regular training to meet our demanding standards.

Cost inflation

Commodity prices of copper and steel, which are major component parts within our industry, have seen a steady surge during the course of the year. In addition, UK prices of materials that we procure could be affected by any weakness of sterling. The majority of projects we secure do not allow for the recovery of increased labour and material costs. We have in place formal supplier framework agreements across the UK to manage and where possible mitigate this risk.

People

Our people, their values and reputation create our success and we would not have been able to deliver respectable results in another tough year without them. Providing a consistently high quality service to our clients is only possible with the right people, and attracting and retaining high calibre staff is key to our success. This is achieved through a remuneration system linked to performance and through strongly embedded training schemes throughout the group and by providing opportunity and encouragement to help our people reach their full potential. The group remains committed to providing the best training for all members of staff and draws on the expertise of its people from all group companies across the UK. However as a result of the current market conditions we have and will continue to align our business at all levels to match our current expectations. We have continuous dialogue with the trade unions and continue to review our policies and procedures in managing this risk.

Management of financial risks

The main financial risks faced by the group are as follows:

Credit risk

The group's main financial assets are contract and other trade receivables and cash and bank deposits. These assets represent the group's main exposure to credit risk, which is the risk that a counterparty will fail to discharge its obligations resulting in financial loss to the group. The group has procedures in place for mitigating the credit risk on trade receivables prior to accepting a contract and during the progression of the contract, and seeks to structure the payment profile on contracts to ensure that its exposure to risk from counterparty failure is minimised. The counterparty risk on cash and bank deposits is managed actively by the regular review of the credit-worthiness of the relevant banking institutions.

Liquidity risk

The group manages liquidity risk by maintaining adequate reserves and banking facilities, monitoring cash flows and by matching maturity profiles of financial assets and liabilities within the bounds of its contractual obligations. At the year end the group had £7.2 million net cash and bank deposits (2009: £23.2 million).

Cash flow interest rate risk

The group is exposed to changes in interest rates on its bank borrowings and deposits. Surplus cash is placed on instant access, short-term or long term deposits at fixed or floating rates. The group's financial instruments comprise cash and cash equivalents, bank deposits, overdraft facilities, contract and other trade receivables, trade payables and similar balances arising directly from operations. The group does not trade in speculative financial instruments." 

Statement of Directors' Responsibility

The following responsibility statement is repeated here solely for the purpose of complying with Disclosure and Transparency Rule 6.3.5. This statement relates to and is extracted from page 43 of the 2010 Annual Report and Financial Statements. Responsibility is for the full 2010 Annual Report and Financial Statements not the extracted information presented in this announcement and the Final Results announcement.

"Statement of directors pursuant to the disclosure and transparency rules

Each of the directors, whose names and functions are listed on page 38, confirms that, to the best of each person's knowledge and belief:

·; the financial statements, prepared in accordance with IFRS as adopted by the European Union, give a true and fair view of the assets, liabilities, financial position and profit of the group and company; and

·; the directors' report includes a fair review of the development and performance of the business and the position of the company and group, together with a description of the principal risks and uncertainties they face.

On behalf of the board

Martin Walton

Finance Director

Russell Race

Chairman

18th March 2011"

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