Minerva Equity Limited - 31 March 2019 Final 19.08.2019 - Flipbook - Page 16
Minerva Equity Limited (formerly DMWSL 881 Limited)
Strategic Report
for the period ended 31 March 2019 (continued)
Business model (continued)
Key Account Ownership
We understand our client’s needs through focused account management led by our respective
Executive Directors and their management teams.
Commercial Discipline
Proven cost-effective control measures are in place to ensure effective risk management and
accurate and reliable financial reporting.
Bespoke Business Solutions
Our specialist teams support the bespoke development of systems and processes to meet the
specific need of each of our clients to deliver best in class solutions.
Long-term relationships
We nurture long-term relationships with our clients across multiple contracts including multi-year
frameworks.
Established Management
Our Senior Management team has significant experience and expertise within our markets.
Key performance indicators (KPIs)
The Board monitors progress on the overall Group strategy and trading by reference to KPIs, the
principal measures being turnover, EBITDA, Group operating profit, order book, cash flow and
accident frequency rate. These measures are discussed in the Chief Executive’s review and the
Financial review.
Principal business risks
Economic conditions
Much of the Group’s activities operate within framework agreements which do not provide
guaranteed levels of turnover. Economic conditions impact our clients and our contracts. In addition,
our clients rely on borrowing in the financial markets to finance their operations. There is a risk that
clients will seek to reduce expenditure or extend payment terms in order to manage their cash
resources. We engage in regular dialogue with our clients to continually assess these risks and
adjust our resources accordingly.
Economic regulation
Many of the Group’s contracts are with major blue-chip clients who operate in regulated industries.
Both the funding of programmes and the political support for private involvement may be subject to
change.
The regulatory risks for the Group’s clients are cyclical. In the water, electricity distribution, gas
distribution and rail industries, prices are set every five to eight years. There is a risk that the
operating cost targets and capital investment programmes approved by Regulators will impact our
turnover and profitability. However, once final determinations are announced, our clients have
considerable visibility of workload. We engage in regular dialogue with our clients to continually
assess these risks and adjust our resources accordingly.
Contract renewals
The Group’s long-term contracts periodically come up for renewal. There is a risk that the Group
may not renew its contracts with existing clients during a competitive tender process, impacting on
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