Motorpoint Group Plc Annual Report and Accounts 2021 Motorpoint Group plc Annual Report and Accounts 2021

Reigniting growth through E-commerce MOTORPOINT

Car buying made easy Motorpoint is the UK’s leading omnichannel retailer of 0-3 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 are trusted to be the Car Buyer’s Champion.

People Omnichannel and powered customer-centric At our heart we are a people powered business and it is our By focusing on making car buying easy for our customers we talented people who help customers when purchasing a have been able to create the very best omnichannel experience. vehicle from Motorpoint, giving them the advice they’re One that combines the convenience and benefits of buying online, looking for, ensuring everything is to the standard they expect Home Delivery and Reserve and Collect with an extensive and developing new innovations, products and services that nationwide retail network ensuring high levels of quality, constantly improve the purchasing process. service and support. 1 45 77

Strategic Report Governance Financial Statements 1 FY21 Highlights 46 Board of Directors 78 Independent auditor’s report 2 At a glance 48 Introduction to governance 84 Consolidated statement of 6 Investment case 49 Corporate governance report comprehensive income 7 Market overview 52 Audit Committee report 85 Consolidated balance sheet 8 How we create value 55 Nomination Committee report 86 Consolidated statement of changes in equity 10 Chief Executive’s statement 58 Remuneration Committee report 87 Consolidated cash flow statement 14 Chairman’s statement 60 Remuneration policy 88 Notes to the consolidated 16 Response to COVID-19 66 Annual report on remuneration financial statements 18 Our strategy 72 Director’s report 111 Company balance sheet 20 Strategy in action 76 Statement of Directors’ responsibilities 112 Company statement 22 Section 172 of changes in equity Environmental, social and governance 24 113 Notes to the company 33 Financial review financial statements 39 Principal risks and uncertainties 117 Alternative performance measures 44 Non-financial information statement 118 Glossary 119 Shareholder information and advisers

Motorpoint Group plc Annual Report and Accounts 2021 FY21 HIGHLIGHTS

Financial highlights Strategic Report

Revenue Gross Margin

2021 £721.4m 2021 8.7%

2020 £1,018.0m 2020 7.8%

Profit Before Tax (‘PBT’) Basic Earnings Per Share (‘EPS’) Governance

2021 £9.7m 2021 8.4p

2020 £18.8m 2020 16.4p

FY21 performance and liquidity were impacted by forced branch closures and the challenging economic uncertainty caused by the COVID-19 pandemic. Strategic and operational highlights Financial Statements

68,000 69% +35% vehicles sold, inc 25,000 units sold online online retail volume via Action4Cars platform growth

Next day Home Delivery 9,300 available within #18 Best large vehicles home delivered 60 company to work minutes of branches for in the UK

Net Promoter Score (NPS) #18 Best Large Company to #1 Best Company to work of 83 in H2 Work For in the UK, our seventh for in Wales 14 day money back consecutive year in the top 100  Employee engagement guarantee launched #1 Best Company To Work For In at records levels (bHeard) Following successful launch The Automotive Sector  Stockton on Tees, our 14th of free Home Delivery, 1,000 branch opened vehicles delivered in first month

Motorpoint Group plc Annual Report and Accounts 2021 1 AT A GLANCE

The UK’s leading independent omnichannel vehicle retailer

Our Purpose Our Vision Our Purpose is to make car buying easy. Our Vision is to be the car buyer’s We’re here to help our customers buy champion, trusted to deliver unrivalled the car they want, in the way they want. choice, value, service and quality.

Our medium term strategy is to grow revenue to more than £2 billion

Rapidly upscaling Increase customer Expand wholesale Operational efficiency our E-commerce acquisition and and E-commerce through technology capability retention channels and innovation

Substantial increase in Increasing investment in Expanding our Further automation and technology, data and our customer proposition, E-commerce technology investment marketing investment. marketing capability Auction4Cars.com as sales migrate to and leveraging our data. platform to grow and E-commerce channels. Led by online sales accommodate new and fulfilment capacity supply channels. increase in new markets.

Powered by our people See more detail on P30

Underpinned by a commitment to:

Our Our people Our communities Governance Risk stakeholders and culture and the environment management

See more detail See more detail See more detail See more detail See more detail on P22 on P31 on P28 on P32 on P36

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021

Team Member Team IT Support Head Office We’ve been protected and supported been protected financially We’ve receiving the pandemic as well throughout opportunities.I also and development training of the Senior Leadership many that appreciate and friendly to approachable are Team colleagues of all levels.” “ AT A GLANCE CONTINUED

Our Brands A Group focused on growth through two distinct channels: Motorpoint and Auction4Cars.com. Motorpoint is the UK’s leading omnichannel vehicle retailer. Auction4Cars.com is the UK’s leading independent trade car auction site.

Motorpoint Auction4Cars.com Our retail offer of nearly new cars that are under three years Auction4Cars.com, a business-to-business entirely old or have completed less that 30,000 miles provides online auction market place platform, allows an efficient and customers with an omnichannel purchasing journey quick route for sale of part-exchange vehicles which do not combining online with 14 retail branches nationwide. fall into our nearly new retail criteria. The business benefits We also offer a range of commercial vehicles under from over 9,000 registered trade users. the Motorpoint brand.

20+ years Wholesale >9,000 Consumer nearly new vehicles Customers omnichannel dominance online and growing only

Lowest online #1 83 buyers’ fees Low Value retailer cost base NPS from £30

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021

Team Member Team Service Customer Swansea I have never been in such a never I have environment, working supportive as a team. works everyone where The management genuinely I always well-being. your for care and enthusiastic motivated feel when in work.” “ Motorpoint Quality Standard sits at sits Quality Standard Motorpoint Value the secure us to biggest the Being allows prices when we best at competitive stock savings pass those and we stock source branch new Efficient our customers. on to and no requirement capital investment goodwill helps manage the for pay to base. overhead Quality ensuring our operations, of the core quality of the highest levels deliver we and service along the entire product of journey. customer

See more detail on on detail more See pages 23 and 29

as Same Day Driveaway, free Home Delivery, Home Delivery, free Driveaway, as Same Day ofContactless Collections and a range Part- financing and ancillary products. priced and competitively are exchanges through disposed and provided Auction4Cars.com. 100% stock mobility across the UK between mobility across stock 100% able to are means we our branches of any such initiatives, convenience-led provide Service Choice means not only customers our Choice for available of range the model and price stock, options but also the we vehicles purchase, can view, which they through their vehicle. of delivery and take Our people Our people are at the heart of our business, business, our of heart the at are people Our customer the of quality the ensuring in least not to determined are we why is this experience; engagement. team our on focus continually The Car Buyer’s Champion Buyer’s Car The our for Easy Made Buying Car making on focused are team engaged and talented Our vision. our achieve we ensuring and customers INVESTMENT CASE

What makes us different

Key highlights

Only nearly new cars Nationwide 20+ years of Always Multiple revenue – under three years / branch network customer insight and lowest price streams – Motorpoint, 30,000 miles innovation Auction4Cars.com, ancillary services and finance

We make car buying easy by being online and in branch 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 fits their lifestyle.

Easy to Easy to Easy to Easy to Easy to find view buy collect contact

Branch Diverse and Enthusiastic In branch locations vast range of team to help stock to customer Customer browse and through the sales agents within test drive process branches Same day Friendly, highly driveaway trained team Home delivery available Reserve and both online Collect and at branch Comprehensive 360 virtual tour Finance online search of the vehicle completed in Online engine and gallery of privacy of own images with home and with technical access to all specifications information

KEY BENEFITS OF BUYING FROM MOTORPOINT

• Extensive Choice • Flexible Finance Options • Free Home Delivery • Great Value - Motorpoint Price Pledge • Competitive Part-exchange Prices • Same Day Driveaway • Award-Winning Service • Test Drives Available • Contactless Collections • Quality Standard • Buy Online, Collect in Branch • 14 day money back guarantee

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 MARKET OVERVIEW MARKET Consumer confidence Branch consumer confidence. unsettled The pandemic significantly car buying impacted negatively during the lockdowns closures uplift significant in online experience did although we activity, the Whilst the shift digital channels will continue, to revenue. complete to visit branches to still want our customers majority of Whilst the pandemic has created their car buying experience. positioned better now are consumers many ongoing uncertainty, in FY21. in the country dropped and consumer credit financially, be an issue to expected restrictions and holiday airline travel With customers’ be less to competition for is likely there some time, for the up demand following coupled with pent This, pocket. of share in grow to likely is very that the market indicates closures, branch The accelerated as consumer confidence improves. FY22, sales coupled with new and offering, our E-commerce of expansion of with a high level the Board provides collection branches in share gain further to market potential confidence in the Group’s ahead.the year The UK nearly new car market contracted significantly in FY21, but is expected expected is but FY21, in significantly contracted market car new UK nearly The

Motorpoint’s core proposition is the sale of nearly new cars which nearly cars is the sale of new proposition core Motorpoint’s than 30,000 fewer covered old and have years three up to are the statistics, notably from market available monitor miles. We but cars target-market for volumes us transaction which give SMMT, use the transaction therefore We mileage. do not include recorded The used car market. our available for alone as a proxy volumes the across dealerships in FY21 due to shrunk considerably market national lockdowns. through UK closing Car market Car Accelerated E-commerce investment means we are well positioned to further increase increase further to positioned well are we means investment E-commerce Accelerated market share. market FY22. in strongly rebound to HOW WE CREATE VALUE

Agility, culture, efficiency 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 efficiencies across our digital platforms and retail network.

KEY STRENGTHS AND RESOURCES HOW WE CREATE VALUE

New branches and growth Retail branches opportunity Our retail branches offer sales, light vehicle We can open wherever we see a market preparation and a large display area. All branches opportunity; speed and scale are in our control. offer café and lounge facilities to enhance our We can choose to buy an existing dealer, or customers’ experience and comfort. Locations develop an entirely new operation, avoiding are generally positioned for ease of access and the need for goodwill payments. located within close proximity of a large population. Our paperless and contactless purchase process allows customers the option to Breadth of stock complete their vehicle purchase in branch or On average 35 brands are available on site online, visit our branch to collect their vehicle, or online, spanning all of the leading makes and drive away in under 30 minutes. and models, sourced from multiple channels. All stock is available nationally. Retail website We constantly innovate to deliver outstanding Retail product offer customer service and we have now launched a Our retail proposition continues to be 100% nationwide Home Delivery service with a 14 day on nearly new cars; our product offering is money back guarantee to all retail customers. supported by providing finance packages to Our website allows us to maintain a convenient our customers through our finance partners as and trusted user experience as customer well as offering warranty, insurance and paint preferences evolve. Our upgraded imaging and protection products. vehicle specification details provide customers with substantial information on the vehicle they are researching or buying, enhancing the Operational control conversion to sale on our website. MyMotorpoint, We have no external restrictions. Proprietary our customer portal was launched in the year IT systems can be built; we have bespoke and allows customers to complete all values‑led development and staff engagement documentation requirements online, enabling programmes; marketing can be via any channel Home Delivery and faster handovers in branch. or into any geography; our modest showroom fit-out costs support Motorpoint’s value Free Home delivery proposition. Our customers can choose a vehicle, arrange finance, purchase and have it delivered to Financing them, without having to leave their home. We We are free to negotiate for the most successfully ran our Home Delivery pilot in competitive terms on the external market. March 2020, which was fully launched in May 2020 and was integral to sales made prior to our branches fully reopening in June 2020.

Part-exchanges Motorpoint sells vehicles with less than 30,000 miles 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 offer the best price to our customers for their part-exchange.

Motorpoint Group plc 8 Annual Report and Accounts 2021 Strategic Report

Operational efficiencies

THE VALUE THIS CREATES FOR OUR STAKEHOLDERS UNDERPINNED BY OUR VALUES Governance

Our operating model is focused on putting our employees first. This means empowering our team and giving them the skills and confidence 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. Financial Statements

Supportive We have a one team ethos and understand that together we achieve more. We are a Digital sales and support team united team focused on a common goal and vision and will always help our customers Sales enquiries received through our website are directed to and colleagues alike #drivingdreams®. our dedicated national sales team which handles email, phone and web chat enquiries. The team sell vehicles, finance and ancillary products for collection at a retail branch, arrange Happy transportation if required, value any part-exchange vehicle We enjoy what we do and we show it – and support our customers through the purchase journey. a smile is contagious and our teams wear them Customers can now also purchase directly from our website naturally with pride. A happy team makes without communicating with our sales teams. In the event for a better working environment which in turn a customer requires support, a dedicated digital support translates to a great customer experience. team provides guidance for our customers to ensure a smooth transaction. Honest Generating outstanding customer value from This applies to our teams, investors and customers. Courage and honesty are a low cost base the vehicles for positive change and Team We are a low cost, high value business focused on generating Motorpoint has embraced this. efficient returns through the efficient deployment of capital resources. Through a cost-effective 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.

Motorpoint Group plc Annual Report and Accounts 2021 9 CHIEF EXECUTIVE’S STATEMENT

Taking positive action Given the impact of the COVID-19 pandemic and Government imposed lockdowns, the Group delivered a robust volume performance in the year, underlining the strength of Motorpoint’s omnichannel model and in particular, the momentum and potential of its enhanced digital capabilities.

Overview Our operating model begins Motorpoint has delivered a resilient trading with our people performance for the year, against a The past year has been unprecedented, backdrop of forced branch closures and the and our people have been exemplary in challenging economic uncertainty caused their commitment to the business, with by the COVID-19 pandemic. We took team engagement scores reaching their positive actions to accelerate planned highest ever level in the second half of initiatives, notably investment in digital, to the year. support our growth strategy. Our operating model of how our key The Group has prioritised investment in stakeholders interact is well understood by E-commerce, launching contactless our people and is covered in detail with collections, a free Home Delivery service, a every new starter when they attend our 14-day money back guarantee and, most induction programs which were held recently, a fully digital part-exchange and virtually this year. The Motorpoint Virtuous finance offering, enabling customers to Circle combined with our Motorpoint “We took positive complete their purchase process entirely Values continue to provide a robust online. The results from our accelerated framework for explaining how we get things action to accelerate investment to date have exceeded done and what factors to consider when planned initiatives, expectations and E-commerce will continue decisions are required. Our people have an to be our priority moving forward. opportunity to ask open questions and notably investment in understand key decisions in their Our focus on growing our E-commerce and interaction with our Senior Leadership Home Delivery channels continued digital, to support our Team, who host Team Forums at each throughout FY21 with further milestones branch, or virtually, usually every month. growth strategy.” achieved. We also continued our branch Many of the improvement areas in the expansion programme, opening a new business are found in these sessions and Mark Carpenter branch (our 14th) at Stockton on Tees in the team often has a creative solution to Chief Executive Officer December 2020. The pandemic situation issues we are facing whether they be has meant that branch research activity to people, customer or operational challenges. identify further new locations was reduced during the lockdowns. Lockdown easing in The learning and development of our the new financial year has meant that this people is vital to the future success of our activity has accelerated, and we are business. Our new Learning and confident of opening more branches this Development platform launched last year to year, with several at an advanced stage. the entire Company allows individual These will further support our digital learning journeys to be created, logged and investment, by offering Reserve and reviewed. I am also delighted at the Collection centres and Home Delivery on a progress we have made by growing our nationwide basis. Technology and Marketing teams this past year. We believe that the happiness of our people 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 fulfilment.

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E D L O Honest EH SHAR Our core values Our core Proud Supportive Happy The right culture to succeed The right culture

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Score 83 Net Promoter H2 is considered to be a more representative period, since customer activity period, since customer representative be a more to H2 is considered at the start FY21 of lockdown during the first impacted significantly was 1. We continue to have fantastic examples of our people of examples fantastic have to continue We whether it be to their dreams, follow using this time to I am proud a school production. a class or watch attend that enterprises team engagement of the breadth of supports. actively Motorpoint that is in rate a minimum pay ensured have we Since 2017 launched our fifth and we Living Wage line with the Real become a the opportunity to scheme offering SAYE team. I am delighted our entire to shareholder Motorpoint by embraced scheme are this of see that the rewards to seeing strong again offering our team, with this year’s the business. across take-up 100 Top Times Our annual participation in the Sunday an opportunity provides For Best Companies Work to for our people to provide valuable feedback on their feedback valuable provide our people to for these can improve we and where levels engagement was insight and great no exception, was This year further. pleased that our people and I am extremely by provided This is the seventh 100 status. Top again achieved we been placed in the have that we year consecutive our of work the hard 100 and is testament to Top and acting on our team in listening management feedback. people’s inclusion and diversity improve to a responsibility have We and a Head Recruitment of appointed We in our industry. our plans in and will advance Inclusion in December 2020 30% also joined the Automotive ahead.the months I have UK from MDs and CEOs of network a voluntary Club, and supplier retailing manufacturing, based automotive gender a better companies achieving of with the purpose industry. balance within the automotive CHIEF EXECUTIVE’S STATEMENT CONTINUED

Customers Motorpoint serves all car buyers, whatever Our highly engaged team continued to their location, and whether they wish to buy online, in-person at our branches, or In a year we deliver our leading proposition of Choice, through a combination of both channels. have stocked over Value, Service and Quality to our loyal customers during the year. We have an Motorpoint has become one of a select unerring focus on customer satisfaction number of businesses to be included in the and that leads to 33% of customers repeat brand-new Platinum category in recognition purchasing from us. We take it personally for achieving successive years of Feefo 300 Gold Trusted Service status. when a customer is not happy, as we have models failed if this happens. Quality – a new pillar to our strategic vision This level of loyalty is recognition of our to ensure that our omnichannel model strategy of delivering unrivalled Choice, delivers the same experience as our pure Value, Service and Quality: branch model. Our ambition is to be the most trusted automotive retailer, Choice – our unique independent model and this means quality across everything allows us to source and sell from the we do, with complete focus on our broadest range of suppliers. In the year we customers’ needs. have stocked over 300 models, and we are able to rapidly follow emerging customer Financial position preferences, such as through our increasing Group revenues of £721.4m for the year 33% proportion of hybrid and electric sales. were 29.1% lower compared to the previous of customers Value – we are an omnichannel car retailer, year (FY20: £1,018.0m), as a consequence repeat purchasing of the COVID-19 pandemic and from us predicated on working to a high volume and keeping our cost base modest. This Government imposed lockdowns. Profit allows us to share value with our customers, before tax reduced to £9.7m (FY20: reinforcing our volume model. We support £18.8m) and we were able to break even in our cars with competitive finance and the second half of the year, despite all retail ancillary offerings, where we also champion branches being closed for over four of the low prices, such as where we have reduced six months. Overall marketing spend was in our customer finance rates in December line with the previous year, reflecting a 2020. Our Value proposition has become reduction during lockdowns, but an increasingly appealing during these acceleration in spend prior to the uncertain times. reopening of branches in April 2021. Service – service is what will ultimately set Gross margin increased to 8.7% (FY20: us apart in the market. We measure 7.8%). This increase reflects robust vehicle ourselves primarily using Net Promoter margins, strong buying and pricing controls, Score (‘NPS') – on this measure we have as well as efficiency improvements to the improved again, with a score of 83 in H2 (H2 preparation processes. is considered to be a more representative Trade revenue fell in line with retail sales, period, since customer activity was since Auction4Cars.com sells wholesale significantly impacted during the first vehicles which have been part-exchanged lockdown at the start of FY21). by retail customers. Roughly 25,000 We are delighted with this level of customer vehicles were sold via this purely online satisfaction, but are always striving for more, platform. Gross margin strengthened to and constantly challenge our processes to 6.6% (FY20: 5.2%), again the result of the make the car-buying experience as smooth market and internal pricing controls. as possible.

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 organisational design support to this digitalorganisational in with further investment transformation our people. business has Our Auction4Cars.com the disrupt a huge opportunity to using auction market, established vehicle Motorpoint and trusted respected the well supply the to stock acquire to brand additional generating wholesale market, exciting are There and profit. revenue opportunities scale the business further to in this E-commerce and investment marketplace channel will enable its be unleashed. to potential and Outlook Trading Current COVID-19 In line with the Government’s fully branches retail the Group’s roadmap, has been The Board opened in April 2021. of the initial levels by encouraged very with a consumer demand since reopening, sales record achieving branches number of been recently has more Supply weeks. ease. this to expect but we constrained, Digital sales strong. remained have Margins the Board and well, perform to continued for its momentum growing expects and Reserve Home Delivery E-commerce, and Collect services as consumer buying evolve. habits along on innovation, our focus to Thanks model agile operating with our low-cost, is Motorpoint offering, brand and strong the of advantage take to positioned well purchase to shiftcontinued consumers of access to the continuing whilst also online, market. in-branch larger currently means that Our truly omnichannel offering a seamless, fully integrated can provide we whether they our customers, to experience a or through in-person buy online, wish to both.combination of Carpenter Mark Officer Chief Executive June 2021 16 Growing our E-commerce revenue to revenue our E-commerce Growing substantially increasing £1bn by over and technology in marketing, investment data sales new and collectionOpening 12 in the investment increasing branches, our and expanding proposition, customer supply channels our E-commerce Leveraging to platform Auction4Cars.com supply channels and new accommodate offering launch our marketplace to through efficiency operational Increasing further and technology automation to migrate as customers investment channels E-commerce now through a fully integrated, end-to-end digital-led This journey. customer digital experience will continue evolve in to 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 our through online, purchasing whether retail branches, or using combination a of channels. these is becoming ever journey The customer our of expansion fluid. An accelerated more new coupled with 12 offering, E-commerce the provides sales branches, and collection confidence that we with increased Board and revenue share both market can grow in the coming years. rapidly significantly plans to has exciting The Group with the aim growth, of rate its increase in the revenue at leastof doubling FY20 margin with an improved medium term, leverage as we cash generation and strong base. cost the operating through: This will be achieved • • • • to will use data and technology We segmentation, customer enable targeted increase to network our branch expand capacity and establish collection customer and enhance hubs, and home delivery Operating expenses 11.8% fell £49.9m by to (FY20: £56.6m), despite the opening of Stockton and on Tees the full year effect of Swansea, which opened in January 2020. CJRS from benefitted also business The income totalling £3.9m (FY20: £0.3m) and reliefrates of £1.8m (FY20: £Nil) in FY21. Overheads remained under tight control throughout FY21, with all discretionary spend challenged.Branch level costs were particularly possible, wherever reduced during periods where there were no customers. onsite specific cost closures, the branch Due to steps and cash management reduction pay including a voluntary taken, were salary equivalent I received reduction. two for the National Minimum Wage to CFO salary and the the former months, of during this period. All 2021 halved was suspended, annual bonus schemes were took Team Senior Leadership and the entire cuts. pay voluntary robust balance sheet remains The Group’s debt, and net cash at thewith no structural £0.8m). (FY20: £6.0m to end increased year within both the headroom This ensured facilities. bank financing and stocking £12.3m) (FY20: £3.6m of Capital expenditure on Tees Stockton the new to related accelerate in IT to and investment branch, of a number Also, our digital investment. The in the year. refurbished were branches branch sale and leaseback our Swansea of cash realising in early completed 2021, was £6.1m. of proceeds achieve To objectives: strategic New than and more £1bn in online revenue in the medium term £2bn in total revenue Motorpoint is an agile business with strong brand awareness, low fixed costs and a compelling operating model that has always offered its customers the best value proposition in the UK used car market. We always soldhave cars online, first through a call centre handling online enquiries and CHAIRMAN’S STATEMENT

Accelerating digital transformation The Group’s robust performance underlined the importance and potential of its online channel, despite the unprecedented impact of COVID-19. The shift in our strategic focus is an exciting moment in the Group’s development.

Introduction Motorpoint serves all car buyers, whatever At the onset of the first UK lockdown, with their location, and whether they wish to buy uncertainty around the duration and depth online, in-person at our branches or of the crisis, the Board took a number of through a combination of both channels. short-term actions to protect the business Motorpoint customers are delighted with and sought to share the burden of those the unrivalled Choice, Value, Service and across stakeholder groups. 2021 Executive Quality they receive: underlined in our Director annual bonus schemes were recent NPS of 83 in H2, up from 81 in FY20. cancelled, and the Executive Directors and Performance the Senior Leadership Team took voluntary pay cuts. Our CEO Mark Carpenter received Group revenues for the year were 29.1% the pay equivalent to the National Minimum lower compared to the previous year, as a Wage for two months and the salary and consequence of the COVID-19 pandemic fees of the other directors were halved. and Government imposed lockdowns. Our Dividends were suspended and share showrooms were shut for around six buybacks cancelled. These were difficult months of the year. In these “The whole Motorpoint decisions, but we acted quickly to protect circumstances, the Group delivered a business can take great the business and it placed the Group in an robust performance, underlining the exceptionally strong position when the strength of Motorpoint’s omnichannel pride in its response market reopened. model and in particular, the momentum and potential of its online channel. to very challenging As the UK’s leading independent Approximately 68,000 vehicles were sold times.” omnichannel vehicle retailer, our approach during the year, including circa 25,000 has always been to provide the customer wholesale units purely online through the with a first class, integrated customer Group’s Auction4Cars.com platform. Of Mark Morris experience. Our customers can shop online the retail sales, 52% were sold online (over Chairman from a desktop or mobile device, by 22,000 units), retaining our position as one 16 June 2021 telephone, and/or at one of our retail of the leading retailers of nearly new cars in branches, and the experience is seamless. the UK, both online and offline. The increase in our online business accelerated the need to upskill, train and In the first three months of 2021, when all bring on board additional team members. retail branches were closed, online sales We prioritised investment in E-commerce, grew 89% against the equivalent period last launching contactless collections, a free year, with Home Delivery contributing 57% Home Delivery service, a 14-day money of this. In March alone, 3,300 units were #18 back guarantee and, most recently, a fully sold online. The results from our accelerated investment to date have Best large digital part-exchange and finance offering. exceeded the Board’s expectations and company to work This enables customers to complete their purchase process entirely online. These E-commerce will continue to be our priority for in the UK initiatives build from a strong and long moving forward. history of online sales and previous The Group successfully opened its 14th investment in automation and branch, at Stockton on Tees, in December data utilisation. 2020, and completed the sale and The Group is utilising the footprint of leaseback of its Swansea branch in existing retail locations to act as spokes early 2021. for distribution and collection nationwide, enabling same day in-branch collection and next-day home delivery.

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Closing Position We welcome his replacement, Chris The Group’s balance sheet remains robust Morgan, who joined us as the new Chief Agile, ambitious with no structural debt, and net cash Financial Officer in January 2021. Chris (comprising cash and cash equivalents less brings a strong set of financial, operational and robust and strategic skills to the Board. borrowings) at the year end was £6.0m. The Motorpoint will continue to evolve cash positive position demonstrates the We are looking to further broaden the skill with the buying behaviours of our strength of the business, the impact of the base of the Board to help ensure we customers and aggressively Financial Statements investment decisions and activities, not capture the opportunity afforded by defending and growing our leading having forward purchasing commitments, evolving customer buying habits. market position in the nearly new and a well-controlled and adaptable cost car market. base. The significant amount of cash that The Year Ahead the business is able to generate allows The business has proven success on All of the Group’s retail branches reopened flexibility to invest in our E-commerce delivering consistent growth and on 12 April 2021 in England and Wales, and strategy and new branches. combined with our robust on 26 April 2021 in Scotland, supported by infrastructure and accelerated a host of operational improvements Dividend investment in digitalising the delivered over the last year. The Board business the Group is confident in Given that FY21 represented a period of anticipated pent-up consumer demand its ambitions to achieve a medium- disruption and uncertainty, the Board has upon reopening, and this has proven to be term objective to double its decided it is not appropriate to declare a the case. final dividend. While the Group’s capital FY20 revenues. allocation framework under our new The Board also expects continued growing strategic objectives will prioritise momentum for its E-commerce, Home investment in faster growth, the very high Delivery and Reserve and Collect services cash generative qualities of the business as consumer buying habits evolve. The grow revenue mean that shareholders should still expect accelerated expansion of our E-commerce to more than ongoing cash returns, and as such, this will offering, coupled with new sales and be kept under regular review. fulfilment branches, provides the Board with a high level of confidence in the Board Composition Group’s potential to gain significant further Part of my role as Chairman is to ensure market share. £2 that your Board has the necessary skills, Further excitement comes from the billion knowledge and experience to make investment into Auction4Cars and the informed judgements that are in the best significant opportunity this will bring. interests of all stakeholders. We have today unveiled our new strategic I would like to pay tribute to Gordon Hurst, objectives, and the Board is very excited who stepped down in May 2020. We about the changes and opportunities welcomed Keith Mansfield to the Board in that this brings. The new plans are May 2020 as Chair of the Audit Committee discussed in more detail in the Chief and Non-Executive director of the Executive’s statement. Company. Keith also serves on the Nomination and Remuneration committees. Finally, I would like to thank my fellow Board A chartered accountant by profession, Keith members and everyone at Motorpoint for has chaired a number of audit committees their hard work and commitment, and for for organisations with a public as well as the way they responded to the COVID-19 commercial mandate. pandemic, ensuring that the business was further strengthened during these James Gilmour stepped down as Chief difficult times. Financial Officer on 20 August 2020, having been with the Group since 2016. Mark Morris Chairman 16 June 2021 Motorpoint Group plc Annual Report and Accounts 2021 15 RESPONSE TO COVID-19

COVID-19 timeline

Pay Free 1,000th £140k Motorpoint Pay reductions at Home Delivery Home Delivery saving for NHS temporarily closes Board and senior service launched completed in first workers retail branches team levels month

March April May June July 2020 2020 2020 2020 2020

• UK Government • UK social distancing • Phased reopening • Trading volumes since • Almost 500 NHS announced national rules extended of branches with new branches reopened workers save over lockdown and new • Vehicle discount social distancing stronger than £140k due to the social distancing rules. scheme launched measures anticipated special discount Motorpoint temporarily for NHS workers • Launch of contactless • Branches in Wales and scheme launched closes retail branches in April • Pay reductions at collection with Reserve Scotland allowed to • All discretionary Board and senior and Collect and open on 22 June and spend halted team levels socially distanced 29 June, respectively safe zones at each • Provided laptops • Free nationwide Home • Full COVID-19 audit branch and remote working Delivery service completed on all capabilities planning completed • Handover Portal branches by in-house development and Health and Safety • Rolled out upgraded • Additional sterilisation roll out telephony solution to process added to the • Implemented enable call centre staff final vehicle • Slot booking for unaccompanied to work from home preparation stage collections test drive process • Online Sales team • Launch of Online • Appointments system and customer care Collections Portal (to accommodate functions work • Full suite of risk appointments in from home but assessments and branches) maintain business guidelines produced • Rolled out ability to operating hours and compliance take payments on the training in place website for all employees • New technology • External third party solutions to audit Motorpoint’s accommodate higher implementation of volume of online and COVID-19 guidelines telephone payments and working practices • New wireless payment • Despite difficulties terminals at branches with supply, Motorpoint to be more mobile to acquires sufficient accommodate social volume of PPE to distancing maintain operations • Investment in for a six month period Auction4Cars to accommodate higher number of customers • Negotiated an increased temporary banking facility. This additional facility was not used Motorpoint Group plc 16 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 17

Motorpoint Group plc Group Motorpoint 2021 enabled March Digital Fully digital purchase digital purchase Fully including process part-exchange valuation Online Customer completed journey purchase processpurchase • • Annual Report and Accounts 2021

2021 January 100% by Customer and by Nationwide third third Nationwide national lockdown force comes into sales teamsBranch fully furloughed are Outbound call campaigns to comingcustomers deals end-of-life to Preparation teams Preparation capacity maintained • • • Rapid movement to remote and agile working remote to Rapid movement Job Retention Coronavirus the Government’s of advantage Took colleagues of proportion a large for Scheme (furlough scheme) pay voluntary took and the Board Team Senior Leadership paid colleagues at 100% help maintain our lowest to reductions earningsof engagement, employee of programme an extensive Encouraged on wellbeing focus with a strong environment working secure a COVID-19 Implementation of details see page 25. more For branches. offices and retail across Taking care of our people care Taking in FY21 engagement scores employee Record during objective has been a key support and wellbeing Employee the to a major challenge since this represented the pandemic, : the following endorsed the Board Therefore, culture. Company’s • • • • • 2020 December Retail branches Retail Reopen Retail branches Retail a nationally for re-open short time,of period again at theclosing start 2021 of •

2020 October 2nd November announced for announced for national lockdown lockdown national Second national announced lockdown November for firebreak day 17 in Wales lockdown starting October 23 • •

2020 Live branches September September Track and Trace and Trace Track in all Motorpoint in place to monitorin place to Government update Government and enhancement controls COVID-19 of Risk AssessmentsNew and created implemented live and Trace Track in all Motorpoint branches tracker COVID-19 Daily casesall suspected and negative) (positive and absence Retail customers were able to purchase via our call centre and via our call centre purchase able to were customers Retail digital channels the rollout through in our digital offering investment Accelerated prepared, units 9,300 service. national Home Delivery our free of homes customers’ to sold and delivered their car before view to who still wanted customers many For contactless a streamlined, offered we completing their purchase, and Collect option Reserve compliant with strict COVID-19 safety, to commitment Robust in place including social distancing measures, procedures and thorough branches, in retail covering compulsory face and vehiclescleaning, all surfaces sanitisation of • • • • • • • Responding with agility and meeting demand online with agility and meeting Responding in second half of FY21 results NPS Record in all which resulted Despite the challenges COVID-19 of the Group FY21, much of for being closed branches retail through trading continue to ways innovative introduced omnichannel offering: its • OUR STRATEGY

The Car Buyer’s Champion Our strategy continues to focus on our customer, ensuring we meet their needs and demands online while delivering the highest levels of service, quality, and support through our nationwide retail network.

FY21 Strategy performance

1. GROW OUR OMNICHANNEL 2. GROW OUR MARKET SHARE

How we performed this year

Online To increase our market share we have so far: By driving investment in Technology and E-commerce a great deal • Migrated customers online. 36% of cars were sold online since has been delivered in FY21; from enabling Home Delivery, to delivering reopening in April 2021. Investment in marketing increased brand an end-to-end digital customer experience including: awareness to drive online activity. • Customer handover slot, booking and view • Built logistics capability to offer customers free next day Home Delivery within 60 minutes of a Motorpoint branch or collection • New mobile payment terminals anywhere within the UK. Collection booking at Point of Sale is • New imaging solutions now live. • Pay by link • Made further progress to acquire smaller branches (sales and We are implementing new systems and architectural design that will collection centres) to offer greater opportunity to serve customers give us a single, accurate view of the customer, as well as providing a in any way they wish to buy a vehicle. There is a correlation better customer experience, reducing the margin for error and between market share increases and branches, despite the rise improving efficiency. in online and Home Delivery. Branch presence in a particular market increases our brand awareness. • Continued to improve our IT systems by developing and improving Branches functionality and performance. Integration of customer data into Motorpoint has 14 branches, Stockton on Tees being the most a cohesive view to improve their experience. recent opening in December 2020. Good geographical coverage across large parts of England, Scotland and Wales. Investment in branch refurbishment and planning further expansion of sales and collection centres into the South of England.

Our medium term goals

Rapidly upscaling our Increase customer acquisition Expand wholesale and Operational efficiency through E-commerce capability and retention E-commerce channels technology and innovation • Increased investment in • Open 12 new sales and • Invest in Auction4Cars.com • Increase capacity for >200,000 technology and data science collection branches to accommodate new supply vehicles • Leverage data to drive • Increase Customer Acquisition channels • Complete Hub and Spoke intelligence – customer Cost in the short term with • Enable migration to B2B preparation model segmentation, inventory and subsequent reduction platform with multiple vendors • New preparation centres, buying efficiency • Drive E-commerce sales • Motorpoint ‘Sell your Car’ starting with Glasgow (open • Drive the potential increase of aggressively proposition for non part- Summer 2021) online sales to 50% of revenue • Drive brand awareness and exchange customers • Increase automation and • Invest in the best people ‘shared value’ customer technology in preparation proposition • Target logistics efficiency • Personalisation of E-commerce to reduce cost per vehicle customer journey to enhance movement in network lifetime value • Reduce customer repeat purchase cycle • Quality Control and operational excellence • Outbound and Save teams launched • Target Light Commercial Vehicle online sales Motorpoint Group plc 18 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 19

21 21 14 83 13 81 20 20 Motorpoint Group plc Group Motorpoint 2 12 19 19 78 Annual Report and Accounts 2021 12 18 18 77 11 17 17 77 Non-financial KPIs Non-financial Number of branches Number in branch retail 14th opened its The group addition the only new being on Tees Stockton the had restricted as lockdown during the year, branches. new of identification Net Promoter Score (%) Score Promoter Net to has continued satisfaction Customer being NPS of levels with record strengthen, maintained. 21 21 18.3 62.5 set by an set by 20 20 f 27.3 78.9

1 19 19 30.1 79.9

1 18 18 27.3 76.4 17 17 22.6 62.2 Adjusted EBITDA (£m) EBITDA Adjusted £18.3m to 33.0% by decreased EBITDA Adjusted o in volumes the reduction due to Gross profit was £62.5m, a decrease of 20.8%, 20.8%, of a decrease £62.5m, was profit Gross the pandemic and lockdowns. again reflecting reflects which 8.7% to increased margin Gross buying and pricing strong margins, vehicle robust to improvements as efficiency as well controls, process. the preparation margins. in gross improvement Gross profit (£m) Gross profit 21 21 9.7 125

20 20 1 139 18.8 19 19 147 1 22.2 18 18 143 19.9 17 17 The KPIs for FY17, FY18 and FY19 have been restated following the adoption of IFRS 16 in FY20. 16 IFRS the adoption of following been restated have and FY19 FY18 FY17, The KPIs for at the start FY21. of lockdown during the first impacted significantly activity was since customer period, representative be a more to H2 is considered 144 16.2 1. 2. GP/Adjusted overheads (%) overheads GP/Adjusted and margin in gross Despite an improvement % has overhead GP/Adjusted overheads, lower and the volumes lower mainly due to decreased, within overheads. costs fixed of proportion Adjusted PBT (£m) PBT Adjusted the by impacted significantly was PBT Adjusted lockdowns. imposed pandemic and Government in the even breaking £9.7m, was PBT Adjusted branches all retail despite the year second half of of the six months of four over for being closed that period. Financial KPIs Financial STRATEGY IN ACTION

GROW OUR OMNICHANNEL

Accelerating our transformation to be a digitally enabled market leader

At the centre of this transformation is ensuring that customers are able to self-serve where appropriate and access information and 52% support at any time, from anywhere. of retail sales were sold online Transformation delivered to date This approach has enabled us to speed up A great deal has been delivered in the last delivery; create better, more reliable year from enabling Home Delivery, to an services; realise efficiencies through end to end customer journey, as well as automation; and enable business growth using technology to remove the manual foundational work that will position our Over environment as both a capable platform ‘ceiling’. and a springboard to drive truly integrated, Key highlights intelligent services. • Over 22,000 units were sold online To support business growth we are representing 52% of retail sales 22k redesigning our environment as well as the retail units sold governance and standards that support • Q4 (Jan-Mar 2021) online sales grew online and maintain it. We have implemented 89% against prior year, with Home more effective ways of working to improve Delivery 57% of this quality and pace. We have invested in new • Contactless collection skillsets to ensure scoping is accurate. We will continue to keep up to date with • Full part-exchange and financing technical trends and build roadmaps that online; instant decision making future proof our estate.

See more detail on P6

Motorpoint Group plc 20 Annual Report and Accounts 2021 GROW OUR MARKET SHARE Strategic Report Governance

Online sales through quality and service supported by our branches Financial Statements

Stockton Stockton on Tees on Tees • Opened December 2020 • Sales-only branch, preparation fulfilled by increased capacity in Birtley became • Streamlined branch team, consistent fully operational in with sales focus, including shared December 2020 General Manager Retail branch 60 minute reach Swansea • Opened in January 2020 and performed strongly despite COVID-19 restrictions 14 See more detail on P10 branches nationwide 60 minutes We have next day free Home Delivery within 60 minutes of a branch

Motorpoint Group plc Annual Report and Accounts 2021 21 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 base-line 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: This section 172 statement signposts some of the key ways in which we have engaged with stakeholders across the year ended 31 March • the likely consequences of any decision in the long-term and the 2021 and built confidence in the sustainability of their relationship risks to the Group and its stakeholders; with the Group. It should be read in conjunction with: • the interests and wellbeing of our people and the communities where we are present; • the Chief Executive’s Review from page 10 to page 13 • the impact of our vehicles and business on the environment and • the Chairman’s Statement on page 14 and page 15 the need to ‘de-carbonise’; • the ESG report from page 24 to page 32 • the Group’s relationships with its customers and suppliers; and • the Risk Landscape from page 36 to page 43 • the importance of our reputation for integrity and high standards • the Chief Financial Officer’s Review from page 33 to page 35 of business conduct. • the Governance and related reports from page 48 to page 76. 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.

Motorpoint Group plc 22 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 23

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 read more on page 28. read more read more on page 30. read more Awards / recognition Awards employees by and volunteering Sponsorship Continuing with our community focused our contribution which cement partnerships and the economic development to sustainability these of communities local charities providing Raising funds for pandemic, the COVID-19 throughout relief NHS workers. and supporting frontline feedback with regular is provided The Board and market views on investors’ developments senior pandemic, Despite the COVID-19 held virtualmanagement meetings with shareholders and potential existing a number of provide Secretariat Company queries to onservices such as responding with shareholders private holdings to share support registrars of updates trading issued half and full year We on the market update to via the RNS facility the business of the financial performance and (www.motorpointplc.com) Our websites a provide (https://www.motorpoint.co.uk/) and data. information of range broad Initiated the diversity and inclusion the diversity Initiated Inclusion created a newly by led programme Committee and Head Recruitment a new of Appointed change drive to Diversity health wellbeing and offer Continue to and with both mental, physical initiatives ensuring to committed financial support. We at least the living wage. pay we score High NPS business and referral repeat Strong customerunderstand better data of to Use these and addressing needs, the is informing research Customer data and customer a vehicle of development profile. on team focus and senior management CEO supply chain challenges arising by channels and suppliers new into expanding suppliers of range with a broad Engaging channels, between transition and regularly in our product flexibility of with a similar level offering supply chain team of strengthening Further and processes.

• • • • • • • • • • • • • • • • • • • Outcomes: Community investment initiatives Community investment create to partnerships into Enter gender balance within thebetter industry automotive in the invest Commitment to ofsuccessful and sustainable delivery young and education for careers people in our local communities. Annual Report RNS announcements MeetingAnnual General presentations Investor website. Corporate bHeard engagement survey engagement bHeard our to a virtual alternative Created have hires and all new day, welcome a virtual welcome attend been able to our CEO and meet with day and talent development Training programmes to points virtual touch new Launched and employees to connected stay This forums. listening our regular host Hour sessions. is done via our Happy on a regular sought feedback Direct in H2), Feefo (83 basis via NPS and Google reviews (Platinum rate) team is also on Care Our Customer and help on the listen hand to email. and by telephone business of and terms Standard supplier meetings regular planning should there Contingency in the supply chain be a failure on-boarding and distributor Supplier due diligence (financial, quality, and compliance,business integrity Modern Slavery supply, component etc) supplier of Ongoing management relationships. • • • • • • • • • • • • • • • • • • How we engage we How

Why we engage we Why our communities. on a premium-listing with As a company Main Exchange’s Stock the London bank debt, of we and a borrower Market clearly communicate andneed to and with our existing effectively to and lenders shareholders prospective the how of their understanding develop managed to businesses are Group’s and sustainable returns generate success. long-term Our employees care deeply about our care Our employees employer, communities. As a responsible the economic to contribute to want we and sustainability of development It is crucial that we develop and maintain develop It is crucial that we with our relationships working strong the can enhance so we suppliers, our business of and create efficiency suppliers treat we sure make and value, Our Choice, Value, Service and Quality Value, Our Choice, the right on having is reliant proposition for deliver enable us to to partnerships on an unerring focus have We customers. and that leads to satisfaction customer purchasing repeat customers of 33% us. from and ethicalin line with our values assess continually our We standards. supplier and partner and network, and external both internal leverage appropriate ensure to expertise economics. and fair relationships We have an experienced, diverse and diverse an experienced, have We recognise which we workforce dedicated our business. asset of Therefore, as a key to continue it is important that we and environment the right develop and encourage to culture Company individuals and opportunities for create their full potential. realise teams to

Our shareholders Our communities and partners and Our suppliers suppliers Our Our customers Stakeholder people Our Engaging with our stakeholders Engaging with decision making. important the Board to and is critical been more has never stakeholders our key the needs of and understanding Engaging ENVIRONMENTAL, SOCIAL AND GOVERNANCE Supporting our environment The Group takes its responsibility towards the environment very seriously and has introduced many initiatives focused on reducing waste, improving energy efficiency and reducing its overall carbon footprint.

Go Green Birmingham Clean Air Zone Initiative Our partnership with Go Green, launched in 2020, has been fully Birmingham City Council partnered with us to offer people working in rolled out in FY21 and enabled us to be more efficient with the the Clean Air Zone the chance to scrap their old car and receive classification and segregation of our waste. We have recycling £2,000 credit towards a compliant vehicle, or a mobility credit. We are facilities in every retail location, workshop and office. The following proud to have been given the opportunity to support the Clean Air initiatives were undertaken during FY21: Zone’s Scrappage and Mobility Scheme and through it help play our • 4,528 tyre casings collected from branches and recycled; part in reducing the level of nitrogen dioxide emissions in Birmingham. • 3.9% of waste to landfill; Streamlined Energy and Carbon Reporting (‘SECR') • 59% vehicles banded Euro 6; We measure and report on carbon emissions in compliance with • 82% of parts disposed recycled; and SECR, covering energy use and associated greenhouse gas • All three main third party valet service providers are using emissions relating to gas, electricity and transport, intensity ratios bio-degradable products. and information relating to energy efficiency actions. In accordance with the Companies Act 2006 (Strategic Report and Directors’ Energy efficiency actions Report) Regulation 2013, the table below sets out Motorpoint’s We are committed to responsible energy management and will emissions in 2021, compared with 2020. practise energy efficiency throughout our organisation, wherever it’s 2021 2020 cost effective. We recognise that climate change is one of the most Total energy use covering electricity, gas, serious environmental challenges currently threatening the global other fuels and transport (kWh) 8,370,540 10,310,413 community and we understand we have a role to play in reducing Total emissions generated through

greenhouse gas emissions. combustion of gas (tCO2e) 573.92 832.89 Total emissions generated through use of We have implemented the policies below for the purpose of purchased electricity (tCO e) 885.89 1,095.57 increasing the business’s energy efficiency in the relevant 2 Total emissions generated through use of financial year. other fuels (tCO2e)1 204.38 174.89 • Continued process of replacing existing lighting with LED lighting Total emissions generated through business in all sites. travel (tCO2e) 162.17 218.90

• Moved to remote home working due to COVID-19. Will review Total gross emissions (tCO2e) 1,826.36 2,322.25 when situation permits. Intensity ratio - total gross emissions

• Implemented and encouraged use of video conferencing. (kgCO2 per sqft) 2.79 3.55 • Travel reduced due to COVID-19. Our roadmap to achieving compliance with mandatory Methodology used in the calculation of disclosures Taskforce on Climate related Financial Disclosures (‘TCFD') SECR methodology as specified in ‘Environmental reporting As confirmed by the FCA, from 1 January 2021 all premium listed guidelines: including Streamlined Energy and Carbon Reporting companies in the UK are required to make better disclosures about and greenhouse gas reporting guidance March 2019’ used in how climate change affects their business, consistent with the conjunction with Government GHG reporting conversion factors. recommendations of the TCFD. We have already been focusing on this important matter, and are recruiting a dedicated Sustainability Manager to develop a sustainability led reporting standard of the actual and potential impacts of climate change on our business, as well as to explain how we identify and manage such risks and opportunities in our FY22 Annual Report and Accounts.

Case study Sound sustainable governance is crucial for our business and Approach Procurement use paper from suppliers who hold we expect our suppliers to support our sustainability obligations FSC and PEFC certifications to ensure the paper they use and aspirations. originate from sustainably managed resources, and filter suppliers and materials to precise environmental credentials. We have partnered with Approach Procurement Solutions Their internal systems and processes allow for a consolidation of (‘Approach Procurement’), a procurement platform which has deliveries which reduces the overall number of delivery journeys a global supply chain with each member appointed for their and a reduction in CO emissions. ability to work within the environmental requirements set out by 2 their clients. Approach Procurement undertake a series of due The hybrid mail solutions delivered through innovative print, diligence initiatives (such as staff satisfaction and retention, and mail and digital technologies allows Approach Procurement to effective relationships with all key stakeholders) to ensure ethical provide meaningful communications whilst minimising their business practices are employed in order to deliver strong, sustainability footprint. sustainable solutions.

1. Increase in other fuels due to availability of diesel at nine branches (FY20: six branches). Motorpoint Group plc 24 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 25

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Policies and practices Policies that the highest recognises The Board to in order required are safety of levels The and customers. our employees protect and injuries that all incidents believes Board and that all employees preventable, are home return to expect to the right have day. working every at the end of safely who Compliance Manager, The Group Officer the Chief Operating to reports support and advice to consultative provides health safety and for at all levels managers The Chief the Group. across matters the to monthly Officer reports Operating issues. The health and safety on all key Board systematically that the Group requires Board sets hazards, healthmanage its and safety regular by progress and monitors objectives audit and review. measurement, in all levels across and supervisors Managers managing the for responsible are the Group their teams as part of of health and safety health a positive and embracing promoting emphasises The Board culture. and safety the importance individual responsibility of the of at all levels health and safety for to employees and expects organisation, in be involved to hazards, potential report to adhere solutions and to implementing policies. A key and Group rules, procedures of improvement in the continuous element is sharing management health and safety and lessons learnt best from practice and the wider the Group across incidents and near incidents Accidents, industry. with actions investigated, misses are recurrence. prevent to generated in the practices embed health and safety To our that all ensure we wider workforce, health and safety receive employees modules as part a two-year of training by Completion is monitored cycle. training Support Managers Operations Regional second module failures with notification for discussion with line management. for sent

Social distancing safe ensure used to Floor markings are andsocial distancing is in operation easily managed. to in order taken have All the actions we is safe our people and customers keep risk of a suite underpinned by and guidance documents assessments, which encompass our end tochecklists end business activities, and all our team third External this. to adhere members confirmed that audits party verification and appropriate were our controls these were further endorsed by local by further endorsed these were authorities Health and Public England occasions when we on the few More localised outbreaks. self-reported engage with begun to have we recently carrying officers local authority enforcing COVID-19 workplace out the HSE’s have we On a daily basis, surveys. who team members recorded vigilantly and or self-isolating, been tested have confirmed monitored also centrally infections, of cases establish to patterns localised remedial take enabling us to action.

Sanitation stations Sanitation and notices provided Sanitation stations are these. the use of reinforce Temperature checking Temperature on mandatory checking In addition to to made available were facilities arrival, check their temperature staff to the day. throughout PPE to provided are and gloves masks Face all staff. Enhanced cleaning desks surfaces, and branch All office sanitised. regularly are and workstations In response to the new dangers from COVID-19, we implemented additional Health and implemented we COVID-19, from dangers the new to In response safe. our staff and customers keep to at all our facilities procedures Safety such as: measures practical of included the deployment Actions Health & Safety Health We recognise that as a business we have an important role to play in our play to important an role have that as a business we recognise We In hardship. in unprecedented has resulted COVID-19 local community. a good being these challenging times, about Motorpoint it is not just operate. the communities in which we but about giving back to employer Social ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONTINUED

“Motorpoint has always been heavily immersed in supporting the local communities and specifically helping to positively impact the future. Being able to make a meaningful contribution to a young person’s life in this way is a privilege, something we genuinely feel proud to be part of. We truly believe that confidence and knowledge allows choice and self belief.”

Enterprise Employers Network – continuing to support the next generation We reported in our 2020 Annual Report and Accounts that we became 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 significant number of initiatives throughout lockdown to ensure the young people still had access to meaningful employer encounters, including the Open Doors programme (which started in February and 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 different 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. “Being able to share insight, networks and time with schools As a result of our commitment to Project to help make their careers services meaningful will deliver a SEARCH and similar activities we are classified more sustainable and positive landscape for everyone. as a disability confident employer and were Many young people, through no fault of their own, do not nominated for a RIDI (Recruitment Industry Disability Initiative) award. We were a finalist for have the opportunity to experience what careers may exist our supported internships in Peterborough. for them and the Cornerstone Employers’ network can help change that”.

Motorpoint Group plc 26 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 27

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Apprenticeships the cut back by schemes were Although our apprenticeship their complete apprentices had seven we pandemic, full to our programme return plan to We qualifications. capacity in FY22. Providing Derbyshire Education Business Partnership Derbyshire Providing with suitable accommodation Education up with Derbyshire teamed we In December 2020, internship their supported provide to Business Partnership class-based learning scheme with suitable space for office the Partnership’s of in a closure resulted after COVID-19 accommodation earlier in the year. Partnership with the Automotive 30% Club 30% with the Automotive Partnership Club 30% Mark Carpenter joined the Automotive Our CEO inclusion and gender on raising The club is focused this year. as a As well industry. the automotive balance throughout gender balance, maintain a minimum 30% to commitment engage with to us with a platform provides our membership specialist of and access an array people, schools and young to us with a platform It also provides in equality. networks others. and inspire our best practice share ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONTINUED

Motorpoint in the community Our charity initiatives are branch led with each branch nominating their own charity partner to work with during the year. This translates into successful outcomes for all our stakeholders. During the year the following fund-raising activities were completed:

Branch Charitable Partner Sponsorships Birmingham Birmingham Children's Hospital Birtley Sir Bobby Robson Foundation Chester-Le-Street Amazons Burnley Lancashire MIND Burnley Golf Club Castleford The Prince of Wales Hospice Castleford Tigers Derby The Royal School for the Deaf Derby Motorpoint Arena Nottingham Glasgow Scottish Guide Dogs Newport Newport MIND Motorpoint Arena Cardiff Oldbury Birmingham Children's Hospital Peterborough Sue Ryder Thorpe Hall Hospice Sheffield Cash for Kids South Yorkshire Stockton on Tees Sir Bobby Robson Foundation Swansea Maggie's Cancer Centre Widnes James Bulger Memorial Trust

We also donated £3,500 to the Samaritans, a registered charity aimed at providing emotional support to anyone in emotional distress, struggling to cope, or at risk of suicide throughout the United Kingdom and Ireland, often through their telephone helpline. Outside of our corporate charity partners our employees also wanted to be able to do their bit for their chosen personal charities and Motorpoint has historically matched each donation. Colleagues across the business have taken part in fund raising activities for Prostate Cancer UK, Prince of Wales Hospice, Pontefract and Wolfpack 100 raising money for FareShare, a charity which helps fight hunger and tackle food waste. These are just a few of the examples our community minded teams have been involved in over the past 12 months.

Payroll giving Charities have found that donations diminished over the past year, so more than ever we felt it important to maintain our partnership with payroll giving. Employees continue to gift to charities of their choice directly through payroll and we also hosted a campaign where donations to new charities would be matched.

Employee Heroes Adam Gilmore “I volunteered for a charity that we support called Life Savers Scotland who are an emergency blood £3.5k transport charity that provides a free service to the NHS. Donated to During last year I helped out collecting COVID-19 tests Samaritans from all the local hospitals and transporting them to the main lab in Glasgow for testing.”

Motorpoint Group plc 28 Annual Report and Accounts 2021 Key facts Strategic Report

Team engagement Team turnover Glassdoor score Roles recruited Highest ever levels as Reduced to 19% from 26% evidenced by receiving the this year - this is a trend we 3* Best Companies have seen year on year, with 4.5/5 197 Governance Accreditation a reduction of 16% in last three years

Internal promotions We have partnered with Miss People and

Macaroon to support a fantastic social Financial Statements enterprise as well as provide 1st Culture Award anniversary treats for all our teams as 46 they achieve this milestone Finalist

Top 100 Best Companies for the 7th year running

#18 Best Large Company To Work For in the UK #1 Best Company To Work For In The Automotive Sector #1 Best Company To Work For in Wales

Values

We are proud We are supportive We are proud of what we do, how we do it and We have a one team ethos and understand the people who make it happen – we stand out that together we achieve more. We are a united from the crowd and are proud to work as part of team focused on a common goal and vision and Team Motorpoint. will always help our customers and colleagues alike #drivingdreams®.

We are happy We are honest We enjoy what we do and we show it – a smile We speak the truth and give honest feedback at is contagious and our teams wear them naturally all times; this applies to our teams, investors and with pride. A happy team makes for a better customers. Courage and honesty are the vehicles working environment which in turn translates for positive change and Team Motorpoint has to a great customer experience. embraced this.

Motorpoint Group plc Annual Report and Accounts 2021 29 ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONTINUED

At Motorpoint we believe that the combination of our focus on driving dreams, robust ESG credentials and people and culture differentiates us from our peers.

Our people Employee wellbeing We will continue to emphasise the Employee wellbeing has always been high importance of employee wellbeing and the Our people are at the heart of our business. on the agenda, but this year we have seen critical role employers play in providing Our achievements this year can be the impact of the pandemic reinforce the support to colleagues. We continue to build attributed to our talented teams who employee requirement for further support. on our support package in this area and worked with pride and resilience through a In Motorpoint, when we talk about ensure that we regularly emphasise the hugely challenging year. Our people have supporting our employees with their importance of being open about these issues, regularly encouraging colleagues demonstrated determination, commitment wellbeing, it covers all four areas: mental, to also be open and to support each other, and dedication, adapting to new ways of emotional, physical and financial. while providing additional support to working and embracing change to ensure colleagues. the future success of the business. Our Mental Health First Aiders (‘MHFAs') approach to developing a high performing We have over 30 trained MHFAs and have and inclusive culture is achieved through made it a compulsory training module for a number of initiatives and is explained all managers in our business. In addition on the following pages. every Motorpoint branch has two trained MHFAs to support the teams locally. COVID-19 safeguarding measures All of our HR Business Partners are also formally qualified. 2020 was a year of unprecedented change for our teams. COVID-19 forced three Partnerships separate lockdowns and many of our colleagues were furloughed. This put a stop We continue to partner with Sovereign to many of our usual methods of Healthcare to provide a 24-hour employee support counselling hotline and financial connecting, celebrating and engaging with support for key health treatment including our workforce. Despite all these changes it optical support, physical therapy and has been a hugely powerful year for our dental care. team which has delivered some exceptional Talent development at Motorpoint results. Our team has been fully committed Emotional wellbeing – One Big Our growth plans remain ambitious and to delivering excellence for our customers Dream scheme exciting, and we have recruited into 197 throughout the year, as is shown in our NPS. roles this year. Talent and succession As a business we have remained truly Our One Big Dream scheme gives the planning is at the core of enabling this focused on safeguarding our team, gift of time and flexibility, and allows an growth. This year has seen the ensuring we are digitally mobilised, individual to take time out, once a month, introduction of our new Leadership and our culture and values remain at fully paid to do something that matters Development programme as well as the core of all we do. to them. We only ask that employees do something that will genuinely drive their offering some core personal All head office teams, along with our online happiness. This benefit has received development workshops and sales and customer care departments, were immensely positive feedback and has been operational technical training for all mobilised to remote working in March used across an array of activities. The team members joining the preparation, 2020. We safely moved all employees to diversity of people’s selection demonstrates yard and customer service teams. home working and have created COVID-19 just how important it is to apply the This year we have partnered with Raise secure working spaces in all our branches. flexibility to our employee benefits in order The Bar, a unique online programme Our support teams will remain working in a to have a real impact on personal wellbeing. featuring global experts to inspire a new flexible and agile way with workspaces We also give extra leave for birthdays, generation of leaders, facilitated by being centres for connectivity and moving house and getting married. industry leading specialists to develop a creativity. bespoke fast track leadership Financial wellbeing programme for our emerging talent. Learning in lockdown Since its launch in 2018 my MoT, our We hosted a number of virtual sessions with employee discount portal has delivered We run the internationally recognised external experts and ensured they were £37,000 savings to our employees on their Navigator and Springboard programmes available to employees and their families everyday purchases. provided by specialist consultants every and friends who were also in their bubble. year and applications are open to These included managing change and During lockdown our senior leaders sent everyone in the business. building resilience, sleep and yoga. We even regular communications, not only on Coaching is a core part of our culture. provided some resources to support with practical and business updates, but also Our Senior Leadership Team has been home schooling and cooking. on key resources and tools, to support our team and their family, who were negatively actively mentoring a number of our We also launched our new Learning impacted. We protected our lower earning emerging leaders to develop these Management System, MySkills, to provide team members’ pay (who were furloughed) individuals reach their full potential, full access of our training materials and at 100% and have committed to tracking with the guidance of an impartial other e-learning resources to all employees as a real living wage employer as we move designated contact. throughout lockdown. into 2021.

Motorpoint Group plc 30 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 31

Gap -0.57% 73.29% Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 £10.56 Female £2,889.75 Male £10.50 £10,818.38 Average bonus pay Average hourly pay average Total Avoid any unconscious bias when writing our vacancy adverts. All of our adverts go our adverts All of adverts. writing our vacancy unconscious bias when any Avoid and position that the tone This ensures go live. they before a gender decoder through our redesigning of also in the process are We gender neutral. are our adverts of which is underpinned brand, with the corporate alignment ensure to brand employer and employees. our customers for neutralisation ensuring gender by friendly policies, including parental our family and improve monitor to continue We and paternity enhanced offer We working. flexible to and our approach leave and working flexible to our approach changed completely have and we pay maternity balance help with their work-life to home from work our teams to encourage actively wellbeing. and overall a networking with Flex, partnered have talent pipeline we our female further drive To coach and support each other on ideas, mentor, share to successful of females group paths. their career and Team with the Senior Leadership Gap report our Gender Pay will share We who make support those and guidance to provide to teams continue leadership selection decisions. Closing the Gap Gap through our Gender in closing Pay progress great made some have Although we acknowledge we roles, leadership into females of and recruitment the development will continue We Gap. further our Gender be done to close Pay to is still some work there opportunity of is our Sales and an area roles, leadership our key equality across ensure to the average female, are our Sales of Executives Although 6% demographic. Executive Quartile. within our Upper sits this group for hourly pay and a restructure Team our Senior Leadership into females new two of The introduction in females of the representation impacted has positively level leadership build in a new to by This is further demonstrated 19%. to 5% from which has increased Quartile, the Upper workforce our female of during FY21 18% strategy; and development our recruitment male counterparts. of with 8% compared or promotion increase a pay received strategy: Attraction • • • • Equality, Diversity and Inclusion Diversity Equality, individuality to and celebrate educate to this year set up an Inclusion Committee have We our Equality, forward move to regularly meets The Inclusion Committee inclusivity. drive building a of against our objectives delivering are we ensure to and Inclusion focus Diversity the Chief by is chaired Committee The Inclusion true inclusion in our workforce. of strategy as the Group across from Officer other team member representatives and has eight People in our people team to a role appointed also formally have and allies. We peer mentors The and Inclusion plans. Diversity our Equality, to and expertise resource dedicated provide and Team with the Senior Leadership directly and Inclusion will work Head Recruitment of proactively are we ensure to build our plans and goals in order to network our employee true inclusion. of a culture deliver against them so that we measuring ourselves Engaging/Listening to our employees is and advocacy engagement Employee been have high. We at a record by rating employer with a 3* accredited class’ ‘world Best Companies, showing engagement. The employee of levels after awarded accolade was prestigious in grading an exceptional received we employee bHeard the Best Companies’ and pay staff well-being, covering survey leadership growth, personal benefits, us once has led to This result and more. 100 Best in the Top again being ranked in the UK. This For Work Companies To 100 in the Top 18th ranked were we year a 2021, For Best Companies Work to since the last Best huge improvement our exceeding Companies event 24 42 by of highest ranking previous places. at number Alongside our position 100 Best Companies to in the Top 18 1st in listed was list, Motorpoint For Work Best Companies Sector the Automotive our best are list. These results Work to and a huge achievement ever, rankings of. proud extremely are which we independent in external Our rankings high and really also remain platforms of us maintain a Glassdoor rating saw the year. 5 throughout out of 4.5+ on employee up the volume Turning really are and ensuring that we voice is most connecting with what matters out a number rolled have essential. We in the absence of do this, to ways new of much of for visit branches being able to in our invested have We the year. and team as communication platforms virtual touch as launched new well employees to connected stay to points forums. listening our regular and host where Hours done via Happy These are a month. forums two hosts our CEO ENVIRONMENTAL, SOCIAL AND GOVERNANCE CONTINUED

“We are committed to promoting a culture within Motorpoint where everyone does the right thing and acts with integrity at all times.”

Governance 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 TCF is a core foundation of delivering our A review and reporting environment has We operate a confidential whistleblowing retail proposition of Choice, Value, Service been developed to ensure that Motorpoint’s hotline which is available for all of our team and Quality, and is thereby fundamental to high expectations are met, and that all and our suppliers, to give them the delivering long-term business value. To this systems, people and processes are opportunity to raise any issues about end the Board has reviewed and maintained supported to achieve our TCF objectives, dishonesty or malpractice within our Treating Customers Fairly and including via: Vulnerable Customers policy. Through Motorpoint, the results of which are • qualitative quality controls, such as after concerted focus, TCF has become an independently collated and submitted to sale customer interviews and mystery integral part of the culture and is subject to the Compliance Committee. shoppers; frequent and rigorous scrutiny within all Anti-bribery and corruption forums that consider, inter alia, customer- • quantitative quality controls, such as facing processes, staff remuneration, and cancellation rates for products within Motorpoint has a zero-tolerance policy in product selection. We are committed to their cooling-off period; and respect of bribery and corruption. This delivering the best possible service to our extends to all business dealings and • ongoing training and support for our customers, with objectives across the transactions, and includes a prohibition on team, including personalised and business reflecting this aim. offering or receiving inappropriate gifts or scheduled refresher training. making undue payments to influence the In particular, the following business areas Human rights outcome of business dealings. are under constant review in light of Motorpoint conducts business in an ethical changes to Motorpoint’s business model, Staff are required to disclose offers of gifts, manner and adheres to policies which customer requirements or the regulatory hospitality or other incentives with a value support recognised human rights environment: of more than £200. All employees receive principles. We continue to address the risks communication of the relevant policies as • marketing practices, including of modern slavery and human trafficking, part of the onboarding process and new promotional material; with the Board debating and adopting the versions are sent out if updated. annual Anti-Slavery Statement and raising • sales processes, whether on site, via the awareness of the risks across the business. The Group does not make political contact centre or digital; We work with our suppliers to protect donations. • customer communications; workers from abuse or exploitation by • record keeping; and communicating to them the terms of our Treating Customers Fairly • complaints handling. Anti-Slavery Statement and request their Treating Customers Fairly (‘TCF') is a adherence to our policy. regulatory requirement and applies to all regulated firms in the conduct of their A statement of the Group’s compliance business. The Financial Conduct Authority with the Modern Slavery Act 2015 can (‘FCA') regards fair treatment of customers be found on the Group’s website at by firms as a key part of FCA regulation in www.motorpointplc.com. the retail market.

Motorpoint Group plc 32 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 33

£m 2020 78.9

31 March 1,018.0 Year ended Year Total £m 2021 62.5 Motorpoint Group plc Group Motorpoint 721.4 31 March Year ended Year Annual Report and Accounts 2021 £m 9.3 2020 FINANCIAL REVIEW FINANCIAL 179.0 31 March Year ended Year £m 8.4 2021 127.6 Wholesale customers 31 March Year ended Year £m 2020 69.6 839.0 31 March Year ended Year £m 2021 54.1 Retail customers Retail 593.8 31 March Year ended Year

Revenue Revenue the Group’s branches, call centre and digital channels, and (ii) vehicles sold to wholesale sold to and digital and (ii) vehicles channels, call centre branches, the Group’s website. Auction4Cars.com via the Group’s customers profit Gross COVID-19 changing quickly to respond to agility its demonstrated During the pandemic the Group June, to through 2020 March the middle of from closed were Branches conditions. trading the for January 2021 from and then and December, in November with further closures our financial year. of remainder included suspending costs cash and reduce preserve to during the year taken Actions of proportion spending and furloughing a large discretionary reducing capital projects, pay also taking voluntary members and Board Team colleagues, with the Senior Leadership paid colleagues their salaries. of In addition, at 100% help maintain our lowest to reductions with our lender, agreed was facility overdraft £15.0m month 12 a further temporary help support should it have cash impacts, to short term 2020 in May Santander UK PLC, relating not used. Amounts was This additional facility during the pandemic. been required £Nil) (FY20: support £1.8m of rates and £0.3m) (FY20: £3.9m scheme totalling the CJRS to in the year. received were sales when branches strong experienced the Group Despite the challenges COVID-19, of and especially the financial year, during the second quarter of customers, open to were In plans. our growth phase of the next entered start FY22 as we to an excellent enjoyed the outlook for and sales during FY21, E-commerce by encouraged was addition, the Board stream. this revenue headlines financial performance Group as a £1,018.0m) (FY20: £721.4m to 29.1% by reduced 2021 31 March to year the for Revenue lockdowns. imposed pandemic and Government the COVID-19 consequence of to increased margin Gross 20.8%. of a decrease £78.9m), (FY20: £62.5m was profit Gross buying and pricing strong margins, vehicle robust reflected This increase 7.8%). (FY20: 8.7% processes. the preparation to improvements as efficiency as well controls, (FY20: £9.7m to tax fell before Profit £27.3m). (FY20: £18.3m to 33.0% by decreased EBITDA fixed of the proportion reflecting against revenue reduction with the increased £18.8m), all despite the year, of in the second half even broke Group The within overheads. costs in and an increase that period, of six months the of four over for being closed branches retail reopening. the April 2021 for in preparation 2021 spend in March marketing debt, and net cash at the year with no structural robust balance sheet remains The Group’s £0.8m). (FY20: £6.0m to end increased performance Trading via customers retail sold to being (i) vehicles streams, revenue key has two The Group

Chris Morgan Officer Chief Financial this unprecedented period as a stronger business and better E-commerce E-commerce business and better as a stronger period this unprecedented our digital transition. accelerate to confidence renewed enabled, with The Group experienced strong sales when branches were open to were sales when branches strong experienced The Group from emerging are We online performance. and accelerated customers, reaping rewards reaping rewards E-commerce investment investment E-commerce By reacting quickly andBy to closuresdecisively theof our branches, business demonstrated the agility to respond quickly to the changing conditions andtrading a strong with emerged balance sheet to support growth future ambitions.” “ FINANCIAL REVIEW CONTINUED

Despite the impact of COVID-19, the Group delivered a robust Interest volume performance in the year, underlining the strength of The Group’s net financial expense decreased to £2.9m (FY20: Motorpoint’s omnichannel model, and in particular, the momentum £3.5m) with borrowings under the Group’s bank facility being fully and potential of its online channels. Roughly 68,000 vehicles were repaid during the year. sold in total. During FY21 the Group increased its stocking facility with Black We accelerated our investment in our digital offering through the Horse Limited by £5.0m, taking the total to £80.0m, in addition rollout of our free national Home Delivery service and a to the existing £26.0m stocking facility with Lombard North streamlined, contactless Reserve and Collect option for the large Central PLC. number of customers who still want to view their car before completing their purchase. At 31 March 2021 the Group had £106.0m (FY20: £101.0m) of stocking finance facilities available of which £89.2m (FY20: £86.1m) Retail was drawn. Revenue from retail customers was down 29.2% to £593.8m (FY20: The Black Horse Limited facility is repayable on the earlier of the sale £839.0m), with approximately 43,000 vehicles sold. Of these 52% of the respective vehicle or a latest date of between 90 and 150 were sold online, retaining our position as the number one retailer of days from date of drawdown of the facility amount. The repayment nearly new cars in the UK, both online and offline. Between launch term was extended by 30 days for vehicles on the scheme as at in May 2020 and the end of the period, circa 9,300 vehicles were 18 March 2021. Since renegotiation the facility bears interest at the delivered to customers’ homes (FY20: Nil). rate of 1.0% over Finance House Base Rate. Gross margin improved to 9.1% in the year (FY20: 8.3%) reflecting a The Lombard North Central PLC was negotiated in March 2019 and number of positive trends. While vehicle margin benefited from all borrowings are secured against the vehicle which the stocking increased demand pushing prices up during open periods, internal finance facility is drawn down against. The finance is repayable on changes in buying and pricing strategies have resulted in continued the earlier of the respective vehicle sale, or a latest date of between positive movements in this area. 90 and 120 days from date of drawdown of the facility amount. The Finance and extras per vehicle sold were broadly consistent with repayment term was extended by 60 days for vehicles on the the previous year, despite the increased mix of online trading. scheme as at 4 February 2021. The facility bears interest at the rate of 1.35% over Finance House Base Rate. The Group also continues to focus on internal processes within the vehicle handling and preparation side of the business. Improved The Group also has a £20.0m facility with Santander UK PLC, split speed of preparation, combined with strong cost control, has between £6.0m available as an overdraft and £14.0m available as a resulted in a further strengthening of gross margin in the year. revolving credit facility. At 31 March 2020, £10.0m was drawn on this facility, to ensure operational liquidity over the year end period of The Group opened a new branch in December 2020 at Stockton on COVID-19 disruption. This was fully repaid in the year. Tees, taking the total of trading locations to 14. Due to the lockdown from January 2021, sales from this new branch were minimal in the Total interest charges on these above facilities were £1.3m year. However, sales at Swansea, which opened in January 2020, (FY20: £1.9m). were encouraging during the times when that branch was open. Interest on lease liabilities of £1.6m (FY20: £1.6m) was incurred Both branches have performed well once the lockdown measures during the year. were lifted in April 2021. Taxation Wholesale The Group seeks to manage its taxation obligations in the UK in Wholesale revenue fell in line with retail sales, since Auction4Cars. compliance with applicable tax laws and regulations, ensuring that com sells wholesale vehicles which have been part-exchanged by available tax incentives and allowances are utilised, and recognised retail customers. Roughly 25,000 vehicles were sold via this purely where it makes commercial sense to do so giving regard to the online platform. Gross margin strengthened to 6.6% (FY20: 5.2%), costs of making the associated claims. again the result of the market and internal pricing controls. The tax charge in the period is for the amount assessable for UK Operating expenses corporation tax in the year net of prior year adjustments and Operating expenses fell by 11.8% to £49.9m (FY20: £56.6m), deferred tax credits. The effective rate of tax in the year of 22.0% including the impact of CJRS receipts of £3.9m (FY20: £0.3m) and (FY20: 19.0%) is higher than the charge which would result from the rates support of £1.8m (FY20: £Nil). Overheads remained under tight standard rate of corporation tax in the UK of 19.0%. This reflects control throughout FY21, with all discretionary spend challenged. timing differences relating to fixed assets. Branch level costs were reduced wherever possible, particularly Shares during periods when there were no onsite customers. Marketing expenses were level with the previous year, with reduced activity At 31 March 2021, 90,189,885 ordinary shares were outstanding, of during periods of closure, but increased activity as we moved which 34,841 were held in the Employee Benefits Trust. towards the April 2021 reopening. Marketing costs also included a greater proportion of digital spend than previously, which is Earnings per share expected to continue. Basic and diluted earnings per share were both 8.4 pence (FY20: both 16.4 pence), a fall of 48.8%. Exceptional items There have been no exceptional items in the year (FY20: £Nil).

Motorpoint Group plc 34 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 35

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Organic growth: the Board will continue to invest in IT systems invest to will continue the Board growth: Organic customers, serve enable us to better locations to and new branch; online or at a purchase wish to whether they a pay to intends the Board shareholders: to returns Regular growing of with a policy shareholders, dividend to regular the business cycle; dividends through enhancing consider value would the Board Acquisitions: existing with its consistent acquisition opportunities in markets operations; to is committed capital: whilst the Board excess of Treatment is that balance sheet,maintaining their expectation an efficient cash to excess returning of will be a resumption there or special dividends. buybacks share of in the form shareholders, Cash flow and net debt Cash flow £33.2m) (FY20: £12.4m was operations from Cash generated from down 98.4%, of conversion cash an operating representing by is primarily driven This movement year. in the previous 148.9% and COVID-19, to relating described above the same factors in April reopening branches for as preparation balance sheet trends, purchasing. inventory increased has driven 2021 were distributions and shareholder Capital reduced spend was and investing from outflows in cash resulting paused in the year year. than the previous financing activities being lower and debt, and cash equivalents, cash net of position The Group’s the Group’s demonstrating £6.0m to £0.8m from has improved environment. in a stressed and strength flexibility throughout positive net cash balances monthly Closing remained the year. and treasuryCapital structure primarily through is provided funding long term The Group’s debt, with bank property related 16 funds and IFRS shareholders’ should it be required. debt available split between with Santander UK PLC, loan facility The Group’s as a revolving available and £14.0m as an overdraft available £6.0m funding short is used primarily as a mechanism for facility, credit £15.0m month 12 capital A further needs. temporary working term to 2020 May in with Santander UK PLC agreed was facility overdraft been required help support should it have short cash impacts, term not used. The was This additional facility during the pandemic. 2024. May in expires facility £20.0m existing Capital allocation policy to in the business in order invest to continue to intends The Board This is on capital employed. and return profit revenue, grow and investment E-commerce for include expenditure to expected strategy. supportGroup’s the locations to new returns shareholder maximise long term is to objective The Board’s and it has cash generated, of a disciplined deployment through in support capital this: allocation policy of the following adopted • • • • Chris Morgan Officer Chief Financial June 2021 16 Dividends and the £2.3m) (FY20: paid in the year dividend was No interim a final dividend (2020: £Nil). There has not recommended Board during the year. buybacks has also been no share and disposals Capital expenditure primarily £12.3m), (FY20: £3.6m was Cash capital expenditure location Only one new on Tees. Stockton the opening of to relating the restricted had as lockdown opened during the year, was branches. new of identification digital its strengthen to in projects is also investing The Group FY22. into will continue this strategy and online presence; offering the to £Nil) (FY20: relate £6.1m of in the year proceeds Disposal which the Group for January 2020), (opened branch Swansea other up funds for free to a sale and leaseback agreement entered Swansea aligns the financing of activities. This approach growth estate. the property with the majority of Balance sheet balance sheet, with net a strong have continues to The Group cost In addition to £15.6m. to £12.0m by increasing assets current managed during the year. proactively capital was working scrutiny, equivalent £20.2m), (FY20: £27.6m were 2021 at 31 March Net assets pence per share. 30.6 to £16.1m made up of £61.8m) (FY20: £60.9m were assets Non-current and assets right-of-use and equipment, £43.6m plant property, of and £1.3m £41.6m £18.9m, tax (FY20: assets deferred of £1.2m being the properties three owns currently The Group respectively). branch, on Tees the Stockton in Peterborough, centre preparation on are All other properties and some additional land in Glasgow. lengths. leases various of up 14.8% inventory, of with £128.4m the year closed The Group partly the due to was This planned increase FY20. to compared but primarily due to branch, on Tees the Stockton addition of branch the April 2021 up demand of the pent for preparing reopening. has a significant the Group buying activity, increased of As a result compares which £3.7m, end of balance at the year receivable VAT and accrued income have Prepayments in FY20. payable a £1.4m to the timing primarily due to £1.4m, to in FY20 £0.4m also risen from period. in the current receivable a rebate of financing facilities, the stock of inclusive and other payables, Trade of result as a direct £111.8m) (FY20: £125.7m to also increased have end. buying activities in the lead the year up to increased £45.4m) (FY20: lease in total £49.3m liabilities to The increase activity. branch the new reflects RISK MANAGEMENT

Continuous identification and review

Many of our principal risks were escalated in the year due to the impact of COVID-19. This has in particular exacerbated economic conditions, health and safety, consistency of supply, and raised liquidity stress, as highlighted in the individual risk descriptions set out on pages 39 to 43.

Approach to risk management Principal risks and uncertainties How the Board manages risk The Board is accountable for maintaining a On the following pages are details of our The Board and each of its delegated policy of continuous identification and principal risks and uncertainties and the key Committees operate to a prescribed review of the principal risks facing the mitigating activities in place to address meeting agenda in order to ensure that all Group which could threaten its future them. It is recognised that the Group is relevant risks are identified and addressed performance or business model. On behalf exposed to risks wider than those listed. We as appropriate. Key management of the Board, the Audit Committee reviews disclose those we believe are likely to have information is reviewed in order to prescribe the effectiveness of Motorpoint’s risk the greatest impact on our business at this operating controls and performance management processes. moment in time and which have been monitoring against the Company’s strategy subject to debate at recent Board or Audit and business plans. The Compliance Committee has delegated Committee meetings. responsibility, from the Audit Committee, The Non‑Executive Directors have particular for formally identifying and assessing these responsibility for monitoring the financial risks annually, measuring them against a and operating performance, to ensure that defined set of criteria, and considering the progress is being made towards our agreed likelihood of occurrence and potential goals. The Board’s responsibilities also impact to the Group. The Compliance include assessing the effectiveness of Committee is formed of the two Executive internal controls and the management Directors and the Company Secretary. of risk. The Group’s risk profile is reported to the Executive Board for review and challenge, ahead of final 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 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.

Motorpoint Group plc 36 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 37

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 External advisors engaged to review review engaged to advisors External 1st and 2nd lines. challenge to of Open culture and processes existing hotline. whistleblowing audit function internal An expanded to being put in place) (currently supportobjective. this Independent and review external • • • 3rd line 3rd We concluded that appropriate controls are in place and are controls concluded that appropriate We that the Group’s considers The Board functioning effectively. permit the to which is adequate information provide systems assessment business its and the proper to risks key of identification risks. those and mitigation of the and Compliance committees, the Audit of on the work Based that: (i) the ensure assessment to a robust has performed Board business have the Group’s and uncertaintiesprincipal risks facing the Group’s aligned to and assessed,been identified and are mitigation is in place. and (ii) appropriate business strategies; Compliance and Data Protection Compliance Data and Protection Officers. audit activity. Operational framework. Risk management engaged to specialists External on compliance and report monitor operations. 2nd line Risk and compliance monitoring • • • • Visible, championed values and championed values Visible, behaviours. expected policies and company Application of procedures. and induction, training Employee ongoing support. team and leadership Executive oversight. Site management with appropriate with appropriate management Site and dedicated team structure line. team reporting leadership • • • • • 1st line and Operational management controls The Board’s review of risk and controls review The Board’s received matters, all strategic considered the Board During the year, financial and on operating, information performance key corresponding of the results and reviewed compliance matters the Audit from received and risk management. The Board controls on all and reports timely information and Compliance committees controls. risk and corresponding of aspects relevant that all policies and ensured Company our key all of reviewed We and scrutiny Board adequate received control internal of matters via the Chairman, all and informally meetings, Board At debate. particular of concern matters raise had the opportunity to Directors concerns in the year. no unresolved were them. There to RISK MANAGEMENT CONTINUED

Viability statement This includes agreement on repayment extensions on the stocking In accordance with the UK Corporate Governance Code 2018, the loan facilities, and notably securing an additional 12 month Board has assessed the prospects of the Group over a period in temporary uncommitted £15.0m overdraft facility with Santander excess of the 12 months required by the ‘Going Concern’ provision, UK PLC in May 2020 which was not used and has not been renewed selecting a three year period to the end of FY24 which takes into subsequent to the year end. account the Group’s current position and the potential impact of In the eventuality of a further period of prolonged closure of all or the principal risks and uncertainties as set out on pages 39 to 43. most of the Group’s branches, it is possible that the Group would In making their assessment the Directors considered the Group’s need to negotiate changes to its current banking covenants but this current balance sheet, its strong track record of generating is something which has only be considered in the more extreme operational cash flows, the availability of facilities, and stress testing downturn scenarios modelled which are not currently of the key trading assumptions within the Group’s plan. considered plausible. The Board has considered a stressed budget position, which The Group continues to consider and monitor further potential models multiple branch closures during FY22 as well as depressed mitigation actions it could take to strengthen its cash position and volumes during open periods, and then one further closure in each reduce operating costs in the event of a more severe downside of the following two years. The perceived impact of COVID-19 in scenario. Such cost reduction and cash preservation actions would FY23 and FY24 of the stress test is reduced compared to FY22 and include, but are not limited to; reducing spend on specific variable therefore the stress factors applied in the model for those two years cost lines including marketing and branch trading expenses, team is less significant. Management demonstrated during FY21 that costs most notably sales commissions, pausing new stock significant cost control measures can be implemented at short commitments and extending the period for which expansionary notice and therefore similar actions have been factored into this capital spend, dividends, and share buybacks are suspended. scenario, including the utilisation of certain Government support The introduction of contactless collection and home delivery initiatives until such support is no longer available under current options during FY21 allowed the Group to maintain steady sales Government legislation. Whilst this stressed scenario places levels through its online and digital sales channels during later additional pressures on both cash flow and profitability, the Group periods of branch closure. Further, as evidence that consumer expects a level of socially distanced sales will again be possible demand for a physical presence still remains strong, record levels during future lockdowns, and ultimately expects to return to normal of sales volumes have been seen when our branches have been levels of volume upon reopening. permitted to reopen. The selection of the assumptions for the stressed budget is inherently The Group has demonstrated an exceptionally flexible approach to subjective, and whilst the Board considered these assumptions to trading in a restricted environment, in particular experiencing reflect a substantial downside, albeit plausible, scenario, the future improving online sales, and is well placed to capitalise on growth impact of the Coronavirus pandemic is unknown. opportunities as we enter FY22. Given recent reported trends in Coronavirus case numbers, as well The Directors have also made use of the post year end trading as vaccination coverage, there is very good reason to be optimistic performance to provide additional assurance that the year end that any future impact of the pandemic is likely to be less severe stock levels and associated provisioning were reasonable, and that than what was seen in FY21. The Board does acknowledge that it is reasonable that no branches require an impairment provision. there are potential future direct and indirect implications of the While only a short period has passed since the year end, this pandemic which could continue to impact on the Group, including evidence adds further comfort to the continuing strength of the on its liquidity and adherence to financial covenants but these are Group in an active market. highly unlikely. Based on this assessment, the Board confirms it has a reasonable Scenario modelling has been considered throughout the year and expectation that the Group will be able to continue in operation and at year end by management to formulate response options against meet its liabilities as they fall due over the period to 31 March 2024. moderate or severe downturns in sales volumes, potential margin pressures and possible cost challenges. The Board has determined that the period constitutes an appropriate period over which to provide its Viability Statement. During FY21, the Group demonstrated its ability to take extensive This is the period detailed in our Strategic Plan which we approve actions to minimise the impact on short term cash flows; each year as part of the strategic review. Whilst the Board has no temporarily pausing all capital expenditure, furloughing team reason to believe the Group will not be viable over a longer period, members, suspending dividend payments and the share buyback given the inherent uncertainty involved we believe this presents programme, except to cover employee related share-based users of the Annual Report and Accounts with a reasonable degree payments, and reducing all non-essential spend. The Group has of confidence while still providing a medium term perspective. made use of the Government’s Coronavirus Job Retention Scheme and continues to work closely with its financing partners.

Motorpoint Group plc 38 Annual Report and Accounts 2021 PRINCIPAL RISKS AND UNCERTAINTIES

Risk and impact Mitigating controls Progress made in FY21 Strategic Report Competition, Market and Customers The UK vehicle market is highly • Continue to drive our multichannel • Successful re-platform of our competitive and customers have a broad proposition, refined post COVID-19 to motorpoint.co.uk website and choice of retailers, some of which offer accelerate growth opportunities. introduction of Home Delivery and our comparable products. The market • Continue to compete via our business Reserve and Collect offer with minimal continues to see consolidation and model’s consistent focus on Choice, disruption, enabling us to serve innovation, through which our Value, Service and Quality; each of customers when branches were closed competitors have progressed their these cornerstones is built into the due to COVID-19. propositions. business operation and reporting. For • Increased brand awareness through Concurrently customer expectations and example, customer satisfaction ratings continued investment in brand Governance buying patterns are evolving, with the are used in the calculation of all marketing and nationwide TV traditional research and purchase bonuses or commissions across advertising. channels becoming ever more influenced the business. • Continued innovation in our digital by digital media, peer recommendations • Investment in brand marketing, digital offering and strengthened campaigns. and convenience. engineering, data insight capability and service to raise awareness of Failing to stay ahead of the market or to Motorpoint and meet customer needs. adapt to changing customer behaviours faster than the competition could • Investment in supply chain capacity undermine our ability to meet and capability, and delivery of our objectives. productivity improvements to enable us to compete effectively and allocate resource to growth driving activity. Financial Statements • Commission regular customer insight reports to track performance against the market, competitors and other key indicators. Mystery shopping best in class retailers.

Brand and Reputation As a function of being independent of • Brand awareness and relevance • Conducted brand tracking analysis in manufacturer support, Motorpoint expanded to both new and existing November 2020 to understand brand attracts new and repeat customers customers, through investment in our perception from active consumers in substantially through building a website, advertising and via more the market. Second session delivered in compelling perception of the Company’s personalised outbound April 2021. brand and reputation. Our customers communications. • Launched new TV creative to carry key expect us to deliver vehicles that are safe, • Customer satisfaction, measured using messaging around our four core value compliant with legal and regulatory the NPS system, sits at the heart of our propositions – Choice, Value, Service requirements, and fit for purpose. operations and is subject to regular and Quality. Failure to maintain these would rapidly scrutiny across all levels of the • Improved social media monitoring result in a loss of customer confidence business. processes to ensure customer and impact levels of business. • We closely monitor customer interactions are considered and dealt perceptions using both qualitative and with quickly and effectively. Unfavourable publicity concerning the quantitative feedback, and respond Company or the industry in which it • Migration of website pages into a quickly where possible. operates could also have an new content management system adverse impact. • We constantly review our branch accelerated. This enabled changes process to ensure we continue to and updates to content to be made deliver on the customer proposition. quicker and with more creative flexibility.Roadmap of branch improvements now in place for key pages and journeys within the online buying journey.

Motorpoint Group plc Annual Report and Accounts 2021 39 PRINCIPAL RISKS AND UNCERTAINTIES CONTINUED

Risk and impact Mitigating controls Progress made in FY21 Availability and Terms of Customer Finance Vehicle sales volumes rely on our • Constantly monitor the market and • The wider ongoing economic impacts customers being able to access emerging trends. of the COVID-19 are yet unknown, but affordable credit lines. As such the • Work in conjunction with our partners may lead to a change in customer Company is exposed to the risk of to keep our consumer credit offer affordability and a change in risk lending institutions reducing, terminating relevant, competitive and viable. appetite of lending institutions. or materially altering the terms and • Where possible reinvest in the quality of • Customer finance offered through a conditions on which they are willing to the customer offer, preferring to build panel of key relationship partners to offer consumer credit to the its appeal rather than maximise our minimise any negative impact on Company’s customers. commission rates. the customer. 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.

Supply Chain Disruption Sales/profitability and customer • Use of a broad spread of supply • COVID-19 safe processes implemented satisfaction could be impacted by supply channels, within each of which are in our distribution centres and Home chain disruption or loss of access to long-standing relationships. Delivery Network to enable operations key suppliers. • Employment of an experienced buying to continue throughout and post the team which is responsible for COVID-19 crisis. This included a maintaining an efficient and effective significant increase in ‘Direct to supply chain. Customer’ deliveries from our suppliers. • Able to utilise our buying criteria within • ’Fit for Future’ logistics capacity plan the scope of our retail proposition (age developed. Will need to evolve this as and mileage of vehicles) to access we increase capacity to meet increased more supply if required. demand for home delivery. • Business continuity plans in place for • Upgraded home delivery vehicle fleet. Motorpoint non-store facilities. • Business continuity plans for all • We seek to limit dependency on branches reviewed, and successfully individual suppliers by actively executed. managing key supplier relationships.

Brexit The ongoing risk of disruption on the • Post-Brexit risk assessment in place and • Continuing to work with logistics supply chain following the UK’s exit from regularly reviewed, and mitigations in partners and suppliers to minimise risk the European Union is likely to have at place. of supply chain disruption and ensure least some impact on Motorpoint - with • Hedging requirements regularly that processes are in place for new circa 80% of new UK cars being imported reviewed. customs’ regimes. from the EU. Any movement in foreign • Contingency plans put in place to adjust • Plans in place to manage potential port exchange rates or friction within the to new legislation from January 2021. congestion. transport or customs process have the • Prepared operational plan to manage potential to impact pricing and volume fall in value of sterling. allocation in the UK.

Motorpoint Group plc 40 Annual Report and Accounts 2021 Risk and impact Mitigating controls Progress made in FY21 Strategic Report Economic Vulnerability Failure to withstand the impact of an • Internal control and risk management Action taken to mitigate impact of event or combination of events that process in place to identify and COVID-19 crisis including: significantly disrupts all or a substantial manage risks (including emerging risks) • Securing financial position of the Group part of the Group’s sales or operations that may impact the business. by ceasing all non-essential (e.g. pandemic). • Conservative financial approach – expenditure, reduction or freezing of strong balance sheet, relatively low salaries. levels of structural debt, low risk • Increasing the frequency of Board property portfolio, ‘value for money’

meetings. Governance mentality. • Ensuring that we had plans in place for • Strong and united Board and colleagues to work remotely where Management team in place, possible and contingency plans to experienced managers in key roles and close/ reopen branches and facilities committed colleagues. safely in accordance with legal • Strong values – emphasising ’long term requirements. thinking’ and ‘acting like owners’ – • Prioritising safety of colleagues and which Board and senior management customers. are required to role model, embedded in the business through recruitment • Working closely with suppliers to and appraisal, and colleague implement alternative fulfilment routes. communications. • Increasing engagement with Financial Statements • Strong relationships maintained with colleagues, customers and suppliers. key stakeholders (shareholders, • Increased focus on colleague colleagues, customers, suppliers, well-being. community). • Investment in the Motorpoint brand and diversity of routes to market provide flexibility through our omnichannel approach. • Business continuity plans in place and kept up to date for branches, operations and technology. • Insurance cover in place to cover key risks, where applicable. Particular focus on cash flow management. • Expert third-party advisers in place (e.g. corporate PR, corporate, banking, legal) to assist.

Finance and Treasury Growth constrained by lack of access to • Motorpoint uses a selection of finance • Actions continue to improve controls capital/ financial resource. facilities to fund its operations including around stock and cash management, a stock financing facility secured including controls around stock against its retail vehicle stocks. purchasing and forecasting. • The Group has a £6.0m overdraft and a • Forward-looking cash flow forecasts £14.0m Revolving Credit Facility in and covenant tests prepared to ensure place until May 2024. that sufficient liquidity and covenant • A treasury policy and set of processes headroom exists. are in place to govern and control cash • Negotiated an increased temporary flow activities, including the investment banking facility approved by the Board of surplus cash. in June 2020. This additional facility was • Hedging arrangements in place for not used. foreign exchange transactions, and freight and energy prices are agreed in advance, to help mitigate volatility and aid margin management.

Motorpoint Group plc Annual Report and Accounts 2021 41 PRINCIPAL RISKS AND UNCERTAINTIES CONTINUED

Risk and impact Mitigating controls Progress made in FY21 IT systems, Data and Cyber Security Operations impacted by failure to develop • Formal IT governance processes in place • Relaunch of motorpoint.co.uk platform technology to support the strategy, lack to cover all aspects of IT management. achieved with minimal disruption to of availability due to cyber attack or other • Changes to IT services are managed offer a fully digital part exchange and failure, and reputational damage/fines through a combination of formal finance offering enabling customers to due to loss of personal data. programmes for large and complex complete their purchase process programmes, or bespoke iterative entirely online. development methodologies for • Implemented more effective ways of smaller-scale changes. working to improve quality and pace. • A detailed IT development and security • We have invested in new skill sets to roadmap is in place, aligned to strategy. ensure scoping is accurate. • Comprehensive third-party support in • Continued to implement a plan to place for relevant technologies. protect personal and sensitive data, • Business continuity in place for all major following the appoint of our Chief systems and applications. Technology Officer who is also an • Regular vulnerability scans, annual experienced Data Protection Officer. penetration testing with systematic methodology to treat identified threats. • Business process, authorisation controls and access to sensitive transactions are kept under review. Regulatory and Compliance Fines, damages claims and reputational • Policies and training are in place in • Health and safety has been integral to damage could be incurred if we fail to respect of key compliance areas. These our response to the COVID-19 crisis and comply with legislative or regulatory are regularly reviewed and updated. we developed and implemented safe requirements, including consumer law, • Operational management are physical measures and processes at health and safety, employment law, GDPR responsible for liaising with the our branches and offices. and data protection, Bribery Act. Company Secretary and external • Continued to conduct horizon scanning advisers to ensure that new legislation is processes to identify changes in The Company also has various FCA identified and relevant action taken. regulatory expectations. These include permissions to carry on a range of any changes that may be required as a regulated insurance and consumer credit • Training on the requirements of the result of the FCA supervisory review and activities from which it derives income. Bribery Act and anti-money laundering enforcement process such as the There is a risk that increased regulation or policies are in place for all relevant introduction of Thematic Review TR19/2 restrictions on the sales process or nature colleagues and policies are released in April 2019, specifically of these products would restrict the communicated to all suppliers. focused on consumer insurance income available to the Company. • Whistleblowing procedure and independently administered helpline products which has been carefully which enables colleagues to raise considered by the business. concerns in confidence. People and Culture The success of the business could be • The composition of the Executive team • The safety and wellbeing of our impacted if it fails to attract, retain and is regularly reviewed by the Board to colleagues was central to our response motivate high-calibre colleagues. ensure that it is appropriate to deliver to the COVID-19 crisis. the growth plans of the business. Maintaining and evolving the culture of • Plan to increase our focus on diversity • Succession plans and appraisals are our business (embodied in our shared and inclusion, starting by appointing a in place across the Group. values) is essential to delivering our Head of Recruitment and Inclusion to strategy and ensuring the long-term • Shared values describe and embed develop and implement our ambitious sustainability of our business. our culture. diversity and inclusion plans. • The Group’s Remuneration Policy • Increased Group Board focus on Board detailed in this report is designed to and Executive team succession and ensure that high-calibre executives are talent management. attracted and retained. Lock-in of senior • Mental health first aiders – all line management is supported by awards managers are now trained. Trained under the Long-Term Incentive Plan. mental health first aiders are available on all our branches. • Successful colleague engagement methods used in the COVID-19 crisis will be the model for future communication.

Motorpoint Group plc 42 Annual Report and Accounts 2021 Risk and impact Mitigating controls Progress made in FY21 Strategic Report Health, Safety and Welfare The risk that accidents, hazards or • Health and safety training for all new • Incidents are reported online, via a incidents are caused by unsafe practices starters, with additional role-specific reporting tool. Line management deal at work, resulting in injury or death to training for employees in branches. with minor incidents. Major incidents are customers, employees or third parties. • Implemented incident management escalated to the Senior Leadership Team processing to ensure major incidents who are supported by PIB Risk are dealt with appropriately and Management (‘PIB'). problems are logged and actively • Risk assessment is managed in the progressed to resolution. following ways:

• Undertake risk and control assessments • line management on the branches Governance to monitor compliance. have a number of online risk • Continually monitor our mandatory assessment checklists to verify the regulatory training to ensure that all relevant controls are in place; and colleagues are kept informed. • higher level risk assessments are • Ensure that incident reporting including carried out on workshop activities by lessons learnt exercises take place to PIB including Hand Arm Vibration and meet health and safety obligations. 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 fire risk assessment. Financial Statements • 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. • Majority of technical and health and safety training is delivered online. The Training Pathways were overhauled and revised at the end of 2020 to enable a smoother delivery whilst reducing the number of failed modules arising as a result of the bulk delivery method no longer in place. Completion is monitored by Regional Operations Support Managers. • 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 fit solutions.

Motorpoint Group plc Annual Report and Accounts 2021 43 NON–FINANCIAL 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-financial information statement.

Environmental matters Social matters Stakeholder engagement: community Investing in our communities page 26 page 23 and environment Supporting great causes page 32 Streamlined Energy and Carbon Reporting page 24 Anti-corruption and anti-bribery matters page 32 Energy efficiency actions page 24 Related principal risk: Brand and Reputation; Economic Going green page 24 Vulnerability; regulatory and compliance see pages 39 and 41.

As part of this year’s SECR, we have established an Environment Social and Governance Committee. In addition our talent team are Respect for human rights working on business projects focused on improving the Real living wage page 30 sustainability of the business and our impact on the environment. Modern slavery page 32 Company’s employees Treating customers fairly page 32 Related principal risk: see page 42 At a glance page 2 Our operating model begins with our team page 9 Our Core values page 11 Anti-corruption and anti-bribery matters Our Stakeholders page 22 Whistle-blowing hotline, anti-corruption page 32 Winning Culture page 30 and anti-bribery Supporting employee wellbeing page 30

The Company has various employee-centric policies and guidance Related principal risk: Regulatory and Compliance page 42. including: Staff Handbook; HR Policies including equal opportunities; anti-bullying and harassment; whistle-blowing; enhanced maternity leave; paternity leave; health, safety and Investment case page 6 welfare; data protection; and privacy. Non-financial KPIs page 19

Related principal risk: People and Culture; IT Systems, Data, and Cyber Security see page 42.

Motorpoint Group plc 44 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 45

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021

Nomination Committee report Nomination Committee report Committee report Remuneration policy Remuneration on remuneration Annual report report Directors’ responsibilities Statement of directors’ Board of Directors Board to governance Introduction report governance Corporate Committee report Audit

58 60 66 72 76

46 48 49 52 55 Governance BOARD OF DIRECTORS

Delivering excellence

The PLC Board has seen a further strengthening in its membership since we last reported.

Mark Carpenter Chris Morgan Mark Morris Chief Executive Officer Chief Financial Officer Non-Executive Chairman

Appointment Appointment Appointment April 2016 January 2021 April 2016 Committee memberships Committee memberships Committee memberships Member of the Nomination Committee None Chair of the Nomination Committee Background and career Background and career Background and career Mark was appointed as Chief Executive Chris was appointed Chief Financial Officer Mark has been Chairman of Motorpoint Officer in May 2013 following two years as in January 2021. Chris was formerly Group Limited since January 2013 and prior to CFO, and has 18 years’ experience in motor Finance Director at Speedy Hire Plc. Prior to that chairman/consultant since December retail. Mark was previously finance director this Chris held senior finance leadership 2010. He has over 20 years’ experience in of Sytner Group Limited from 2005 to positions at Go Outdoors and Tesco, where car retail having been finance director and 2010. Prior to this, Mark was with Andersen, he was latterly the Finance Director for the then managing director of Sytner Group where he qualified as a Chartered Czech Republic and Slovakia. Chris is a Plc. Prior to his role at Sytner Group, Mark Accountant. Fellow of the Institute of Chartered was in audit, business advisory and Accountants in England and Wales. corporate finance with PwC where he External roles qualified as a Chartered Accountant. None. External roles None. External roles None.

Motorpoint Group plc 46 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 47

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Keith Mansfield Keith Non-Executive Independent theChair of and Director Committee Audit Appointment 2020 May Committee memberships of member Committee, the Audit Chair of and Nomination the Remuneration committees and career Background of the Board to appointed was Keith plc as Independent Group Motorpoint A 2020. in May Director Non-Executive background, by Accountant Chartered accountancy brings extensive Keith over at PwC for worked having experience, as time he served during which 30 years, for responsible PwC in London chairman of tax and advisory services. As aassurance, he has led services to 22 years, partner for a companies across public and private industry of sectors. range roles External of director is the senior independent Keith the he chairs where plc, Eurobox Tritax the and is a member of audit committee and committee engagement management is also the Keith nomination committee. and chair of director senior independent Digital of 9the audit committee Albemarle and chair of plc, Infrastructure Airport Limited. Fairoaks

Adele Cooper Adele Independent Non-Executive Director Non-Executive Appointment 2020 March Committee memberships and Remuneration the Audit, Member of Nomination committees and career Background and senior marketing has extensive Adele at worked having experience, leadership leading technology the world’s some of from at Pinterest companies, recently most While at December 2019. June 2015 to the UK for responsible was Adele Pinterest, strategic, overseeing and Ireland, management. and operational commercial been with Facebook has Adele this, Prior to and Google in a lead global relationship and global regional of and a variety role and operational. in marketing lead roles roles External of director is a non-executive Adele Limited. Ireland Conjura

Appointment as Senior (appointed 2016 May 2016) in October Director Independent Committee memberships the member of Remuneration, Chair of and Nomination committees Audit and career Background division the commercial of CEO Mary was Division the Banking of director and board 17 She spent Plc. Group Brothers at Close leadership with GE in a number of years Fleet the European of including CEO roles, Services business. Mary has also spent at Harrods. years and 14 time with Skandia roles External and committee the remuneration Chair of the nomination andmember of plc. Group OSB of committee governance Senior Independent Mary McNamara Non-Executive Director and Chair Director Non-Executive Committee the Remuneration of INTRODUCTION TO GOVERNANCE

Chairman’s introduction

As a Board, we are conscious that we are Board changes accountable to all our shareholders and There has been an important strengthening must have regard to other stakeholders of the Board over the past year or so. In such as employees, customers, suppliers March 2020 we were joined on the Board and the environment. We maintain an active by Adele Cooper, and in May 2020 Keith dialogue with shareholders throughout the Mansfield was appointed, both brought year and listen to views of representatives considerable experience and knowledge to of investors and financial institutions. We bear over the last year as Non-Executive also welcome the opportunity to answer Directors. shareholders’ questions at our 2021 Annual General Meeting (‘AGM'). In January 2021 we were joined by Chris Morgan when he took on the role of Chief The Company as a whole had to quickly Financial Officer following the resignation adapt to new ways of working since of James Gilmour in August 2020. mid-March 2020 with Board meetings scheduled more frequently and held partly Biographies for each of the current “Proper corporate governance or entirely online. Where meetings were Directors are set out on pages 46 and 47. is important in underpinning conducted in a hybrid format, physical The progress in talent development and our long-term success” attendance was in accordance with UK diversity can be found on pages 30 and 31. Government guidelines. Mark Morris Compliance statements Chairman Monitoring culture and Throughout the year ended 31 March 2021, colleague engagement the Company has complied with the The Board has a wide range of experience, provisions as set out in the 2018 Corporate Dear Shareholder skills and diversity among its members that Governance Code (the ‘2018 Code’) (a copy proved invaluable during the COVID-19 of which is available on the Financial On behalf of the Board, I am pleased to pandemic. The Board has supported the Reporting Council’s website at www.frc.org. report on Motorpoint’s Corporate management team in seeking to raise uk) in all respects except that I was not Governance during the past financial year. standards in diversity and inclusion. The deemed to be independent upon The aim of this report is to explain Group set up an Inclusion Committee appointment as Chairman (Provision 9) – an Motorpoint’s governance framework and chaired by the Chief People Officer this explanation of the Board’s view on this outline how it was applied on a practical year. The primary purpose of the Inclusion matter is set out under the section headed basis in the year under review – a year that Committee is to educate and celebrate ‘Board independence and appointment has been hugely challenging due to the individuality to drive inclusivity. We have terms’ on page 50 of the Corporate COVID-19 pandemic and one that has appointed a new Head of Recruitment, Governance report. required great adaptability, resourcefulness Diversity and Inclusion to provide dedicated and governance strength-in-depth. resource and expertise in developing and Our effectiveness The Board’s role in setting the Group’s implementing our equality, diversity, and Every year we perform an internal review of culture and core values is a significant one. inclusion plans. the effectiveness of the Board. The findings show that the work we do as a Board and in Mark Carpenter and I speak frequently with We are continuing to help create an agile our committees continues to be effective. each other, and all the Board members and inclusive working environment that Our review also confirmed that our focus in have given their time to supporting the helps our people work in a way that’s best the coming year should continue to be on management team, in various capacities, for them and enables collaboration and strategy, succession and development and across a very difficult year. FY21 has shown teamwork in delivering our strategy. More we will commence a search for an that this best enables a culture across the details of our response to the COVID-19 additional Non-Executive Director during Group of agile decision making and speed pandemic, culture, our employee welfare 2021. When recruiting, diversity will be a of reaction to events, whilst maintaining the measures in place and wider social significant consideration and focus in the innovative drive that has been the hallmark engagement can be found in the People recruitment process. of Motorpoint’s success to date. I am very section on page 30 of this report. proud of the work which has been carried Board priorities out throughout FY21 on employee wellbeing and the top-down engagement Our priorities for next year are very much with staff, which will ultimately lead to a focused around building rapid but better, more open working environment. sustainable growth in the Group and delivering on our strategic plan with a strong governance underpin.

Mark Morris Chairman 16 June 2021

Motorpoint Group plc 48 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 49

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Detailed debate on the strategy, in on the strategy, Detailed debate of particular digital the transformation the business and communications relations Investor opportunities such as growth Strategic branches new the opening of the impact of the potential Considered our of on the safety pandemic COVID-19 operations people and on the Group’s and reviewed and financial performance mitigating its plans for management’s and operations impact on the Group’s customers results the full-year Approved Report and the Annual announcement financial year the 2020 for the final of Cancelled the payment dividend in 2020 FY22 for Budget and results full-year results, Half-year updatestrading cash position Group of Review and forecasting reporting performance Monthly and review Matters reserved for the Board for reserved Matters decisions key of control retain to In order is a clear division of that there and ensure and the the Board between responsibility the business, running of the day-to-day matters schedule of has a formal Board decision. These its reserved for reserved include financial reporting, matters and risk management. appraisal investment the Board by reviewed were The matters aligned were they ensure to during 2020 The full schedule of Code. with the 2018 on our website is available reserved matters www.motorpointplc.com. during the year focus Board scheduled holds a number of The Board including a strategy meetings each year, all Almost site. off which is usually held day scheduled or meetings in this financial year, held via video conference. were otherwise, were: the year during focus of areas Key Strategy • • • • Financial • • • • • • CORPORATE GOVERNANCE REPORT GOVERNANCE CORPORATE Chief Financial Officer’s role Officer’s Chief Financial is Officer (‘CFO') The Chief Financial financial the Group’s for responsible and planning activities, control, including the to contributes and also reporting, the Group’s of management broader with supports the CEO business. The CFO implementation and the development, Chris strategy. the Group’s of tracking Company of also assumed the role Morgan basis with effect on an interim Secretary 2021. February 27 from and (being the CEO Directors The Executive meetings by Committee attend the CFO) Chair where the Committee of invitation appropriate. role Senior Independent Director’s as a acts Director The Senior Independent and the Chairman to sounding board the other for as an intermediary serves The Senior when necessary. Directors to is available Director Independent assist with addressing to shareholders with the and meets arise concerns that may (excluding Directors other Non-Executive review to the Chairman) at least once a year the Chairman. of the performance Directors Independent Non-Executive bring Directors The Non-Executive mix of with a broad along independence, and experience business knowledge skills, an external provide They the Board. to are discussions and Board to perspective the executive of the scrutiny for responsible shareholders. on behalf of management constructively Directors The Non-Executive discussions and help challenge Board on strategy. proposals develop the monitor Directors Non-Executive that and ensure performance of reporting within the is operating the Company approved and risk framework governance the Board. by role Secretary’s The Company that ensures Secretary The Company between communication flows effective and between Committees and its the Board and the Non-Executive senior management is Secretary The Company Directors. ensuring that the Board for responsible with the in accordance operates governance corporate Company’s framework. the of and removal The appointment the for is a matter Secretary Company whole Board. Board leadershipBoard and purpose the Board of The role strategic the Company’s sets The Board that the necessaryaims and ensures the allow in place to are resources be met, in a way to objectives Company’s that enables growth. sustainable long-term corporate for It is also responsible financial and the overall governance The Board the Group. of performance values culture, establishes the Company’s and ethics and it is important that the is set,all with the top’ from ‘tone correct devote to being required Directors their role. time to sufficient Mark Morris by chaired meetings are Board openness of and a culture who promotes the Executive including inviting debate, Directors and the Non-Executive Directors Motorpoint’s and challenge debate to matters. strategic is the composition Board The current Non- independent Chairman, three Executive and two Directors Executive Directors. and responsibilities Roles role The Chairman’s is the primary role The Chairman’s that the He ensures Board. the of leadership timely and clear accurate, receive Directors for and is responsible information honesty of culture a boardroom cultivating debate, and openness which encourages and enables appropriate, challenge where an make to Directors the Non-Executive The Chairman sets contribution. effective sufficient and ensures agenda the Board’s all the discussion of for time is allocated Chairman also consults The agenda items. in Directors, with the Non-Executive particular Director, the Senior Independent and governance corporate of on matters any of made aware are all Directors ensures issues and concerns. major shareholders’ the Chairman is satisfied that The Board enabling the of fulfils his responsibilities sound decisions. make to Board role Officer’s Chief Executive is Officer (‘CEO') The Chief Executive of running the day-to-day for responsible business and includes the the Group’s and implementation of development the decisions made by and of strategy as the operational as well Board the Group. of management CORPORATE GOVERNANCE REPORT CONTINUED

Internal control and risk management The Chair, Mark Morris, and the CEO, Mark The CEO and CFO do not currently have a • Performed the annual review of the Carpenter, own approximately 9.6% and non-executive directorship on any other effectiveness of internal control, risk 9.8% respectively of the shares of the listed company board. identification and mitigation Company. Both Mark Morris and Mark Carpenter continue to be considered by Board meetings • Approved the Viability Statement as their fellow Directors to be independent in The Board met regularly to discharge its disclosed in the Annual Report 2021 character and judgement in performing duties effectively and held additional • Approved the adoption of a going their respective duties. The Board is fully conference calls between the scheduled concern basis of accounting in preparing confident that, in the very unlikely event of a meetings as and when circumstances the half and full year results conflict emerging between those duties required. Where a Director was unable to • Considered the Group Cyber Security and their interests as shareholders, they attend a meeting, they were provided with Programme and Health and Safety report would absent themselves from the Board the meeting papers to review and so they discussions in question (and the Board People, talent and culture could provide any comments to the would ensure that they did so). In that Chairman, Committee Chair or Company • Appointment of a new Non-Executive event, the Senior Independent Director Secretary prior to the meeting. Directors are Director and CFO would ordinarily assume the role of chair of provided with meeting papers • Succession planning and talent the relevant meeting. approximately one week in advance of development for all senior roles each Board or Committee meeting. The terms and conditions of appointment Members of the Senior Leadership Team • Reviewed the results of engagement of the Non-Executive Directors are are regularly invited to attend Board survey contained within their Letters of meetings to present on their specific area • Considered general employee wellness Appointment. The terms of appointment for of responsibility. in light of the pandemic the Directors confirm they are expected to • Ensured safe and comfortable working devote such time as necessary for the environments proper performance of their duties. The Board reviews and approves as necessary Governance, compliance and ethics any additional external appointments the • Approved AGM business such as the Directors may look to obtain. Notice of Meeting and related ancillaries • Reviewed the internal Board evaluation process and discussion of the external Board and Committee attendance FY21 Board and Committee evaluations to be The Board has regular scheduled meetings throughout the year. Directors’ attendance held during the course of 2021 at Board and Committee meetings during the year is outlined below: • Reviewed the Directors’ Conflicts of Interest procedures Audit Nomination Remuneration Director Board (13) Committee (4) Committee (1) Committee (5) • Approved the Modern Slavery Act statement, available on the Company’s Mark Morris 13 – 1 – website www.motorpointplc.com Mark Carpenter 13 – 1 – Board independence and Mary McNamara 13 4 1 5 appointment terms Adele Cooper 13 4 1 5 The Board has reviewed the independence of each Non-Executive Director (excluding Keith Mansfield1 10 3 1 3 the Chairman) and considers each of them Gordon Hurst2 3 1 – 2 to be independent of management and free from business or other relationships James Gilmour3 4 – – – that could interfere with the exercise of Chris Morgan4 2 – – – independent judgement. The Company meets the requirement under Provision 11 of 1 Keith Mansfield was appointed with effect from 20 May 2020. the 2018 Code that at least half of the 2 Gordon Hurst resigned with effect from 20 May 2020. Board, excluding the Chair, are Non- 3 James Gilmour resigned with effect from 24 August 2020. 4 Chris Morgan was appointed with effect from 11 January 2021. 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.

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Relations with shareholders Relations the access to have All shareholders Chairman and the Senior Non-Executive to available who are Director, Independent questions which shareholders discuss any the the running of to in relation have may Company. ensure the need to recognises The Board the views of fully aware are that all Directors Copies all of major shareholders. of the Company to relating research analysts’ upon publication. Directors to circulated are Investor a monthly receives The Company which includes an analysis report Relations register. shareholder the Company’s of Morris Mark Chairman June 2021 16 The Board has a formal process for the for process has a formal The Board interest of conflicts any disclose to Directors authorise a to the Board decision of and any if it is is only effective interest conflict of Director(s) without the conflicted agreed being counted. or without their votes voting In making such a decision, the Directors consider in good they must act in a way the promote to likely will be most faith success the Group. of Independent advice independent take may The Directors at the if necessary, advice, professional expense. Company’s and development training Board on the updated continually are Directors in which we business, the markets Group’s and changes the competitive to operate through environments and regulatory the Board to and briefings presentations and the Senior Directors Executive from Team. Leadership the briefings from received Directors on during the year Secretary Company and and compliance matters governance changes. legislative relevant Male Female 4 2 ■ ■ Male/Female split Male/Female INED Executive 2 3 INED/Executive split* INED/Executive ■ ■ (*excluding the Chairman) (*excluding Composition Board of the Annual General Meeting Annual General July 2021. will be held on 27 AGM The 2021 the guidelines issued by on current Based hold to it will be possible UK Government with shareholders in person, AGM this year’s the constantly given However, present. to in relation the situation of nature evolving are shareholders pandemic, the COVID-19 the Chair appoint to encouraged strongly and submit the meeting as their proxy of in instructions electronically their voting the Meeting. of advance will be AGM the 2021 The Notice convening along separately, shareholders to circulated can still shareholders with details on how and in advance the Board questions to raise the AGM of the proceedings follow that shareholders will ensure We remotely. using the Notice of informed kept are and relevant Meeting, our website, in due course. announcements regulatory Conflicts of interest Articles Association, in of The Company’s allow 2006, line with the Companies Act potential authorise any to the Board arise and that may interest of conflicts or conditions as appropriate. limits impose AUDIT COMMITTEE REPORT

Audit Committee Chair’s Statement

Dear Shareholder Committee composition and membership I am pleased to present the report of the The Committee currently comprises three Audit Committee (the ‘Committee’) for FY21. independent Non-Executive Directors. The principal purpose of this report is to look back over the financial period ending During the year the following members 31 March 2021 and describe the served on the Committee: Committee’s responsibilities and activities • Keith Mansfield (Chair, appointed with during that period. effect from 20 May 2020) The Committee fulfils an important • Adele Cooper oversight role, monitoring the effectiveness • Gordon Hurst (resigned on 20 May 2020) of the Group’s system of internal control and risk management framework, and • Mary McNamara reviewing the integrity of the Group’s The Committee met four times during the financial reporting. The principal role of the year and attendance is set out in the table “The Company’s risk Committee is to assist the Board in fulfilling on page 50. management processes were its oversight responsibilities in relation to critical in ensuring Motorpoint financial reporting and financial controls. The Board believes that the members of the could respond with pace and Committee as a whole have competence robustly to the uncertainty Since I was appointed as Chair of the relevant to the sector in which the Group caused by COVID-19.” Committee last year, I have been able to operates, gained from their respective broaden and deepen my understanding of external roles, previous and present. Keith Mansfield the business and each of its functions, Biographical details of Committee Audit Committee Chair enabling the Committee to move forward members are set out on pages 46 and 47. into 2021 with a clear vision – namely, to ensure the soundness and effectiveness of In particular, the Board has identified Keith the Group’s systems and controls, which Mansfield as the member of the Committee has been even more important amid a having recent and relevant financial global pandemic. experience for the purposes of the 2018 Code. Keith has a wealth of accounting The impact of COVID-19 was a significant experience from his previous roles, having issue and a risk to the Group during the worked at PricewaterhouseCoopers LLP period, and this still continues to be the (‘PwC’) for 30 years. case. The Company’s risk management processes became increasingly critical early At the invitation of the Chair of the in 2020 with the emergence of COVID-19 Committee, the Chairman, CEO and CFO and the many risks this posed to the attended all meetings during the year in continuity of our business operations, order to maintain effective and open including the closure of our branches, a communications. reduction in sales and most importantly the The external auditors, PwC, attend risk to the safety of our staff and customers. meetings of the Committee and have direct I would like to thank my colleagues on the access to the Committee should they wish Committee for their contribution during this to raise any concerns outside of the formal challenging year and extend my thanks to Committee meetings. our colleagues within the business who Keith Mansfield have worked tirelessly during a time of Audit Committee Chair extreme uncertainty. 16 June 2021

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Going the concern: the impact of pandemic has placed Coronavirus the Group’s on unusually high stresses As profitability. and cash flow short-term considered have management a result, period month a 12 covering forecasts a signing, producing of the date from of budget including a reduction stressed In the margins. and reduced volumes the models considered, extreme most consider need to would Group banking current its negotiation regarding remote the perceived Given covenants. cases, the these of extreme likelihood is satisfied that no materialCommittee and the Group uncertainty exists a going be considered continues to concern. an annual 36 requires IAS Impairments: Whilst indicators. impairment of review impact of long-term the anticipated the of the severity is limited, COVID-19 an definition of within the pandemic falls 36. trigger under IAS impairment a detailed has completed Management future using expected review impairment in use of the value illustrate to cash flows unit level. at a cash-generating assets This assessment indicates that the assets the Group’s of amount recoverable higher than their carrying value. are lease of liabilities and right-of- Valuation significant requires 16 IFRS use assets: theestimation, particularly around and borrowing, of rate incremental The lease terms. around judgements been based on have rates incremental have estimates it would what the Group the funds party borrow to a third pay to necessary obtain a similar an asset of to asset, with similar the right-of-use to value security and economicterms, is satisfied The Committee environment. and reasonable used are that the rates the leases held. for appropriate Significant matters considered by the by Significant considered matters to the financialCommittee in relation statements the of and final approval In the preparation the Committee financial statements, the key discussed with management estimation of and criticalsources The Committee judgements. accounting issues significant the following considered the FY21 financial statements: to in relation • • •

Annual Report and Accounts to 31 March 31 March to and Accounts Annual Report to results year and half 2021 2020; 30 September with PwCChair met and had discussions as part the audit process; of of audit plan and review External effectiveness; and servicesNon-audit (‘NAS') policy that the presumption a general reached so as NAS PwC is not best offer placed to their independence; safeguard to (going concern prospects The Group’s and viability); policy; and treasury Tax risk assessment includingCorporate risk management risks, the key of review and risks; activities and emerging on the auditor the external from Findings end audit.FY21 year and compliance the disclosures Clarity of and standards with financial reporting and governance financial relevant requirements; reporting judgements in which significant Areas been applied, including discussions have challenge on such with appropriate with the external undertaken matters andauditors; taken Whether the Annual Report, balanced and is fair, as a whole, the and provides understandable shareholders necessary for information performance, assessto the Company’s The business model and strategy. the conclusion incorporating statement this assessmentof on page is included 76. Activities following the reviewed The Committee the last report: since items • • • • • • • • reporting Financial in the Committee of The primaryrole review is to financial reporting to relation the external and with both management the the Board to and report auditor, the annual financial of appropriateness considering amongst otherstatements, matters: • • • the Committee the above, In addition to in completing its supports the Board assessment the going on the adoption of the financial preparing concern basis of as part the of Furthermore, statements. provide to responsibility Committee’s on the long-term the Board advice to the Committeeviability statement, the process of review a robust performed and underlying assessment the Group’s of made by prospects longer-term management.

Monitor the financial reporting process process the financial reporting Monitor of the integrity of including the review the Company, of the financial statements annual and half-year including its Other formal financial results. financial to relating announcements or financial information performance contained in certain is other documents not and therefore the Board by reviewed the Committee; specifically discussed by in and assess the Annual Report Review whether it can advise determine to order the as a whole, that, taken the Board balanced and is fair, Annual Report and provides understandable, with the information shareholders assess need to the Company’s they business performance, position, model and strategy; the annual, the statutory audit of Monitor financial statements; and the consolidated financial significant Review reporting issues; reporting the the Board to Recommend auditor the external of reappointment and their remuneration and approve and engagement; of terms auditor’s the external and review Monitor independence and objectivity and the audit the external of effectiveness including considering relevant process, and regulatory UK professional and the appropriateness requirements of the auditors by the provision of services.non-audit • • • Role of the Committee Role the of and responsibilities The role of terms set out in its are Committee on the available which are reference www.motorpointplc. website Company’s the Committee of objectives com. The key and the Board to and report review to are financial on the Group’s shareholders and risk control internal reporting, and on the systems, management the of independence and effectiveness auditor. external the of details on the responsibilities Further as follows: are Committee • • • authorise the reference of The terms obtain legal or independent to Committee advice at the Company’s other professional expense. AUDIT COMMITTEE REPORT CONTINUED

• Inventory provisions: Given the closure of The Directors assessed the prospects of the • The Committee discusses and agrees at the Group’s retail branches during FY21 Group over a three-year period, which the planning stage the draft list of specific and reduction in sales volumes due to the reflects the budget and planning cycle risks to audit effectiveness and quality Coronavirus pandemic, there is some adopted by the Group. (specific audit quality risks); continued uncertainty around the future The assessment of the Group’s prospects, • The Committee assesses audit planning sale value of inventory at the year end. A together with the Group’s going concern work in respect of specific audit provision is included based on historical and Viability Statement, are set out on quality risks; and forecast sales and potential net pages 38 and 75 of the Corporate • All Committee members, key members of realisable value. The Committee is Governance report. management, and those who regularly comfortable based on performance provide input into the Committee provide subsequent to the year end that the level Internal audit feedback on how well PwC performed of inventory provision is appropriate. The Committee continued to review the the year-end audit; and requirement for an Internal Audit function Annual Report during the year, and following discussion • The feedback and conclusions are The Committee has undertaken a review with the new CFO, now believes that it is the discussed, along with the conclusion and assessment of the Annual Report in right and proper time to build this function. regarding specific audit risks, with an order to determine whether it can advise The process to recruit a designated Internal overall conclusion on audit effectiveness the Board that, taken as a whole, the Annual Audit resource has commenced. reached. Any opportunities for Report is fair, balanced and understandable improvement are brought to the attention and provides shareholders with the External auditor of the external auditor. information they need to assess the Independence The Committee concluded that PwC Company’s position, performance, business provided an effective, independent and There are a number of robust policies in model and strategy. objective audit and that the Committee was place, all of which aim to safeguard the therefore satisfied that it had obtained the In doing this the Committee considered the independence of the external auditor. In highest quality audit possible. The following: accordance with best practice, the external Committee agreed to recommend to the audit contract will be put out to tender every • the description of the business is Board the re-appointment of PwC as the ten years, with the next retender due no consistent with the Committee’s own Group’s external auditor and a resolution to later than the year ending 31 March 2027. understanding; this effect will be proposed at the 2021 AGM. • that there is a clear and well articulated In accordance with the Auditing Practices link between all areas of disclosure Board standards, the lead audit partner at Non-audit services including going concern and viability; and PwC will be rotated every five years to To further safeguard the independence and ensure continuing independence. Mark • the findings from the external auditor as objectivity of the external auditor, non-audit Skedgel, the current audit partner, assumed part of the FY21 year end audit. services provided by the external auditor are this responsibility for the year ended considered, and where appropriate All relevant issues relating to the Annual 31 March 2020. authorised, by the Committee in Report were fully discussed at the accordance with a non-audit services policy. Committee meeting in June 2021. There are no contractual obligations This policy limits the amount and type of that restrict the Company’s choice of services undertaken by our auditor. The Committee has concluded that the external auditor. Annual Report, taken as a whole, is fair, Permitted services are subject to a cap of balanced and understandable and that it External auditor effectiveness 70% of the average of the fees paid for the can advise the Board as required by the statutory audits over a three-year period. The Committee conducts an annual 2018 Code and other relevant rules and external audit effectiveness review each There were no non-audit fees for the year regulations. year which examines the auditor’s ended 31 March 2021. independence, the audit planning process, Going concern and viability statement audit approach and delivery, audit team Keith Mansfield The Company is required to include expertise and experience, resources, Audit Committee Chair statements in its Annual Report relating to responsiveness and communication in 16 June 2021 going concern and viability. The Committee respect of the financial year audit. In order reviewed and discussed a report from to discharge this responsibility the management and concluded that the Committee followed the process financial statements can be prepared on a outlined below. going concern basis and that there is a reasonable expectation that the Group will • The terms, areas of responsibility, duties be able to continue in operation and meet and scope of work of the external auditor its liabilities as they fall due over the next as set out in the engagement letter are three years. reviewed at the Committee meetings;

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Board composition: The Committee composition: Board diversity, skills, of the balance considers the Board of and experience knowledge the and reviews committees and its and composition, size structure, Board’s required including the time commitment Directors; Non-Executive from leads nominations: The Committee Board and appointment on the recruitment and makes Directors for process any regarding recommendations of the composition to adjustments the Board; Succession planning: The Committee the Board to recommendations proposes in service the continuation each of for is that the Board and ensures Director changes its to for prepared well and that appropriate composition in place. succession plans are Committee Governance Committee Governance Committee membership and attendance comprised: the Committee During the year Mark Morris (Chair) CooperAdele 2020) May on 20 (resigned Hurst Gordon 2020) May on 20 Mansfield (appointed Keith Mark Carpenter Mary McNamara met once during the yearThe Committee out in the table is set onand attendance page 50. Committee responsibilities for: is responsible The Committee • • • terms has formal The Committee available which are reference of website on the Company’s www.motorpointplc.com.

NOMINATION COMMITTEE REPORT NOMINATION The Committee regularly reviews the reviews regularly The Committee and committees its the Board, of diversity as partsenior management, the Board of and Issues diversity of process. evaluation the Board by considered inclusion are their significance and due to directly importance within the business. I believe successful if it more will be the Company culture and supportive an inclusive creates from identity, any individual, of every where can be their they feels background, any details on Further self at work. authentic within the business can be found diversity on page 31. Report within the Strategic internally carried out an The Committee and effectiveness its of review facilitated the discussed by the output was This concluded that the Committee. effectively operate to continued Committee the for and confirmed that the focus recruit to be to continue would year coming support the to the Board additional skills to Board develop strategy, refocused as successionsuccession as well planning, the of the other members planning for team and talent management executive The in the wider organisation. management new any will also oversee Committee FY22. for and inclusion initiatives diversity election or subject to are All Directors on shareholders by the Board to re-election AGM. an annual basis at the Company’s a for appointed are Directors Non-Executive annual subject to years, three of term at the AGM. re-election has Board, the The Chairman, on behalf of be continues to confirmed each Director an effective member of the Board and will the Board member of an effective at the election or re-election stand for 2021 AGM. 2021

Ensuring an appropriate mix ofEnsuring an appropriate to supportskills and diversity the business in its growth.” Mark Morris Mark Chair Nomination Committee “ Dear Shareholder the of the report present I am pleased to (the ‘Committee’) Nomination Committee under keeps The Committee FY21. for and the structure review regular and its Board the of composition has that the Board and ensures committees expertise skills, balance of the appropriate support to the Company and experience corporate the appropriate and ensure are and practices standards governance in place. to has continued the Committee In FY21, is on ensuring that the Board focus with the members of composed and expertise skills, balance of appropriate and support the Company to experience corporate the appropriate ensure in are and practices standards governance and for This included the search place. Chief Financial our new of recommendation Committee and Audit Chris Morgan, Officer, Mansfield. Keith Chair,

Chair’s Statement Chair’s Nomination CommitteeNomination NOMINATION COMMITTEE REPORT CONTINUED

Activities of the Committee Non-Executive Director and Audit The Board composition and size is kept During the year the main activities of the Committee Chair recruitment process under review by the Committee in order to retain an appropriate balance of skills, Committee were as follows: In light of Gordon Hurst’s resignation from experience, diversity and knowledge of the the Board which took effect in May 2020, a • Oversaw the appointment of the Group. The Board also recognises the recruitment process was undertaken for his Chief Financial Officer and a new importance of diversity and inclusion at successor. The Committee agreed a Non-Executive Director (the process senior management level. The Group’s description of the role and of the followed is described below); Senior Leadership Team, who are direct capabilities required, following an • Discussed the diversity and inclusion of reports to the CEO, is made up of seven evaluation of the balance of skills, the Board’s composition and operation; members including the CEO and CFO. experience, independence and knowledge There are 40 direct reports to the Senior • Continued to focus on strengthening the required. Appropriate candidates were then Leadership Team for the purposes of Senior Leadership Team, especially in the sought based on merit, against the Hampton-Alexander Reporting. Information area of E-commerce; objective criteria set out, paying particular on initiatives on diversity and inclusion can attention to the merits of diversity on the • Focused on adding to the Board skill set be found in the People section of the Board. by recruitment of a further Non-Executive Strategic Report on page 31. Director with strong E-commerce skills. Drax Executive were appointed to oversee Performance evaluation CFO recruitment process the process and suitable candidates were considered in detail and interviewed by The Board undertakes a formal evaluation The Committee, led by the Chairman, members of the Committee. Following this of its performance, and that of each oversaw the search and appointment of a process, Keith Mansfield was appointed to Director, on an annual basis. The principal new Chief Financial Officer to replace the Board on 20 May 2020 as a Non- committees of the Board undertake an James Gilmour who resigned in August Executive Director, and chair of the Audit annual evaluation of their effectiveness, in 2020. The process, which was agreed in Committee. accordance with their terms of reference. In advance by the Committee, was thorough 2020, an internally facilitated evaluation of and inclusive. An internal and extensive Composition of the Board as at the Board and its committees, which took external search by two recruitment 31 March 2021 the form of a questionnaire, was circulated specialists was followed by an interview INED/Executive split* to the relevant Board members as well as to process which gave the Chairman and the Senior Leadership Team. The each of the Non-Executive Directors the Chair 1 questionnaire sought input on a range of opportunity to meet short-listed candidates. INED 3 matters including composition and diversity Despite inevitable disruption to physical of the Board, Senior Leadership succession, meetings during the process, there was Executive 2 review of strategic plans and the adequacy good communication with the Committee Male/female split of the information in Board papers. throughout the process and the Chairman Male 4 received support from the Senior The Executive members of the Board have Independent Director and the Group Chief Female 2 frequent contact with all Executives and in People Officer as well as the Company normal circumstances make regular visits to Secretary. Diversity and inclusion Group branches. All new Non-Executive members of the Board will carry out The Committee engaged Macildowie The Board recognises the importance of Company visits as part of their induction Recruitment and Retention executive diversity and inclusion in the boardroom and routinely thereafter. The Board search firm (who had no relevant and seeks to recruit directors with varied members also engage with our current and connections with individual Directors or backgrounds, skills and experience. future business leaders working within the with the Company) following a selection Appointments are made on merit and Group. This regular interaction between the process based on objective criteria. Each against objective criteria, taking account of Board and the business provides a vital individual Committee member met with the the skills, experience and expertise of channel of communication and a forum for Chair to discuss their views and objective candidates. open dialogue, which encourages the criteria, taking into account the current At the year-end there were two female sharing of knowledge and experience. skills, experience, independence, and members of the Board, representing 33% of balance on the Board, noting the benefits the Board, which meets the 33% target for of diversity. FTSE 350 boards set by the Hampton- Following the interviews, the Committee Alexander review. The Board aims to retain met to discuss feedback on each candidate or improve this level in the future and look and was unanimous in its final selection and to improve on other areas of diversity too. recommendation to the Board that Chris Morgan be appointed as Chief Financial Officer with effect from 11 January 2021.

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 review the Directors’ tenure and review and review tenure the Directors’ review the Chair and of the re-appointment service whose Directors Non-Executive or year in the next expire agreements two; a of commence the recruitment with strong Director Non-Executive experience; E-commerce on Board view a long-term take and succession diversity composition, the consideration planning, taking into and skills evaluation the Board of result assessment the and changes to and values strategy, overall Company’s mission; the succession of oversight continue and Senior planning at Executive level. Team Leadership Priorities for the year ahead the year Priorities for will: the Committee FY22, For • • • • Morris Mark Chair Nomination Committee June 2021 16 Action the composition of the Board on this Committee will continue to focus through The Board, an additional for and associated succession It intends to commence a search plans. will be a significant diversity When recruiting, during 2021. Director Non-Executive process. in the recruitment and focus consideration to in order experience E-commerce with strong Director of a Non-Executive The recruitment is under its long-term strategy of skill for has the adequate breadth that the Board ensure consideration. plans and the talent management succession and development The Committee will review of a Head of E-commerce. including the recruitment management of the wider organisation, Given Day. Strategy 2021 debated at the April management was by proposed The strategy will spend time conducting a within the business, the Board pace of transformation the rapid debrief after the implementation decisions and consider lessons learnt. of strategic in operational provided the information to review Secretary and Company The incoming CFO topics. the appropriate addresses papers that the quality of Board to ensure reports to be sought during 2021. evaluation External Board Election or re-election of DirectorsElection or re-election the all of Code, In compliance with the 2018 at re-election will stand for Directors current In addition, Chris AGM. the forthcoming election at the first will stand for Morgan the of the annual evaluation Following AGM. the and committees, and its Board the Chris Morgan, for process recruitment that all Directors has determined Board the at election or re-election standing for hold recent be effective, to continue AGM to and continue experience and relevant the role. to commitment demonstrate details each of Director Biographical will be election or re-election standing for AGM. set out in the Notice of 2020 Board effectiveness review effectiveness Board 2020 at the discussed and adopted were recommendations and its the Board of members to circulated were review the internal of The results be these would agreed The Committee table. in the below as set out identified were actions meeting. A number of Board 2021 March facilitated. will be externally which it is intended evaluation, Board the 2021 following be undertaken actions to included with the new The Board is satisfied that each Director is satisfied that each Director The Board the to effectively contribute continues to committees. and the Board’s Board evaluation Board 350 Code states that FTSE The 2018 an externally companies should have three at least every evaluation facilitated is not, as at the Whilst the Company years. it 350, in the FTSE this report, of date conducting an of the value recognises and as such evaluation facilitated externally carrying out an externally to committed a due to However, in 2021. review facilitated Company the Group of re-organisation Board function, an external Secretarial It was not conducted. was evaluation process facilitated that an externally agreed to in order in 2021, later until be deferred Officer and Chief Financial the new allow the ability to Directors Non-Executive new the Company. fully embed into Senior Leadership Team succession planning Team Senior Leadership decisions strategic Reviewing papers Quality of Board evaluation Externally Board facilitated Issue/Recommendation composition, succession and evaluation Board planning. REMUNERATION COMMITTEE REPORT

Remuneration Committee Chair’s Statement Our Remuneration Policy supports the achievement of our strategic objectives by aligning reward with our long-term sustainable performance.

Dear Shareholder his service agreement and the Policy, Mr Gilmour received salary and benefits I am pleased to present the Company’s until the end of his employment. He was Directors’ Remuneration Report for the not eligible to receive a bonus for FY21 and financial year ended 31 March 2021. all of his unvested incentive awards lapsed on cessation of employment. This report is split into three sections: this Annual Statement; the Remuneration Policy We were delighted that Chris Morgan joined (the ‘Policy’); and the Annual Report on the business as Chief Financial Officer on Remuneration. 11 January 2021. His base salary is £255,000, pension is 3% of salary (in line with the rate Actions taken in response to COVID-19 for our employees generally) and he will The Remuneration Committee (the participate in the annual bonus scheme and ‘Committee’) and the Executive Directors Restricted Shares in line with the Policy. The reacted swiftly during the first lockdown in base salary has been set at a higher level April 2020 to conserve cash and ensure than that of his predecessor, which was “The remuneration outcomes that the remuneration of executives was in acknowledged as having been significantly for 2021 strike the right balance line with the broader stakeholder lower than competitive market rates and, in between rewarding our experience, through the following actions: a consultation with shareholders in early employees for their exceptional 2020 the CFO salary rate had originally • The Committee postponed the efforts this year and being been proposed to increase to this level. contemplated significant base salary equitable in the broader Additionally, the pension contribution is increases for the CEO and the former context. Our Remuneration lower, at 3% of salary, compared to the 10% CFO Policy supports the pension contribution for James Gilmour. achievement of our strategic The Board took the following objectives by aligning reward voluntary actions from 1 April 2020: Remuneration Policy with our long-term sustainable During 2019, the Committee undertook a performance.” • Temporarily reduced the Executive Directors’ salary and Non-Executive comprehensive review of the Policy to ensure Mary McNamara Director fees. There was a 50% reduction that it reflected recommended market Remuneration Committee Chair in the salary of the former CFO until practice and continued to both motivate and 1 June 2020 and the CEO received salary retain our people. Following consultation with equivalent to the National Minimum our major shareholders, a new Remuneration Wage until 1 June 2020 Policy was tabled at the 2020 AGM for shareholder approval and received the • Salary reductions for all other members support of 93.1% of the votes cast. The most of the senior leadership team significant change in the new Policy was the • A waiver of any entitlement to the FY21 introduction of a new incentive plan, based annual bonus by the Executive Directors on ‘Restricted Shares’ to replace Performance Shares. This will result in reduced quantum Board changes and share awards will vest over a longer James Gilmour, Chief Financial Officer since period with recipients able to take a April 2016, tendered his resignation in longer-term view on performance and August 2020 to pursue other business strategy. The 2020 Annual Report sets out a interests. In accordance with the terms of detailed explanation of the reasons for changing our approach in relation to our policy for long-term incentive pay.

Motorpoint Group plc 58 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 59

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 We see this latest change as a second, and latest change as a see this We in which will result final, stage a review of our Executive packages for pay appropriate and any years three the next for Directors or CFO the CEO for further salary increases will period the policy of the remainder over workforce be in line with the average barring genuinely exceptional increase, circumstances. FY22 for Application of the Policy the annual FY22, for incentives of In terms of at 100% bonus opportunity remain will PBT, salary and will be based on Adjusted satisfaction customer growth, share market metrics. engagement and employee will be made at awards Share Restricted both Executive for salary of level 75% Directors. changes the to no proposed are As there at the shareholders by as approved Policy approve to will be no vote there AGM, 2020 will, There AGM. at the 2021 the Policy to be the usual advisory resolution however, and the the Annual Statement approve which on Remuneration, Annual Report for outcomes on the remuneration focus the and how under review the year the Policy implement to intends Committee year. next the latest of aware is kept The Committee arena, pay in the executive developments by particularly recommended those monitorwe and shareholders institutional that Motorpoint’s believe We these closely. is appropriate remuneration to approach balance between a fair and represents interests. and management shareholder colleagues on the my all of On behalf of will support the I hope that you Committee, on the Annual Report approving resolution AGM. at this year’s Remuneration Mary McNamara Chair Committee Remuneration June 2021 16

61 82 Total 260 (£’000)

- - - PSP (£’000)

- - - Bonus (£’000)

2 9 27 (£’000) Base salary in early 2020, review As part the policy of the total considered the Committee the Executive packages for remuneration and senior management, noting Directors that the salaries had been set consciously 2016, in at Admission levels market below at the appropriate considered which was an investor had been Whilst there time. modest leading to consultation in 2019 aware was the Committee salary increases, salaries were Directors’ that both Executive be behind what would still significantly for rates appropriate market considered as responsibilities and respective their roles Small a FTSE of leaders high performing and a successful motorCap company and as part On this basis, the of retailer. the in 2020, review policy broader that the salaries determined for Committee from should increase and CFO the CEO and £350,000 to and £215,000 £274,125 from with effect respectively, £250,000 mid- to be closer so as to 1 April 2020, were These increases levels. market consulted. investors those supported by our of closure with the Subsequently, national under the first showrooms that determined the Committee lockdown should be postponedthe salary increases reduced instead (and indeed salaries were James our CFO, in 2020 Later significantly). our and Chris Morgan, resigned Gilmour, on a salary of appointed was CFO, new pension lower (with a significantly £255,000 so this issue only remained contribution), the CEO. for relevant on and with the Company one year Now, and the outlook positive, profitably trading with investors consulted the Committee support, has received again and, having the CEO’s to that the increase determined should be as originally proposed, salary, 1 April 2021. from implemented Pension

1 1 2 (£’000) Benefits

72 58 231 Salary (£’000) Implementation of the policy for FY21 for policy of the Implementation of the operation of year the first FY21 was operation intended and its policy the new the of light in significantly revised was pandemic on the the COVID-19 impact of salary proposed above, business. As noted and then salaries delayed were increases reduced. were on Adjusted based The annual bonus was customer growth volume retail PBT, and Google and ratings) (NPS satisfaction through (measured engagement employee participation in the Best Companies to Directors The Executive survey). For Work bonus their annual forego to volunteered the wider stakeholder of FY21 in light for that Government and the fact experience the Coronavirus through taken support was Scheme. Job Retention Restricted of award made our first We was policy after the new in August Shares AGM. at the 2020 approved Share under the Performance An award Vesting 2018. July in granted (‘PSP')Plan was on challenging contingent was the award of the over measured targets growth EPS 2021. 31 March to financial years three at required the shares of vesting Threshold per annum with full growth least EPS 10% per growth EPS 18% for achieved vesting Compound Annual Growth annum. EPS period the performance over (‘CAGR') Rate the below was which 21%, a decline of was the awards and therefore target threshold will lapse in full in July 2021. during the year, pay to the reduction With the annual of waiver including the voluntary that is comfortable the Committee bonus, and as intended has operated the Policy The is appropriate. that remuneration also confirms that noCommittee performance made to were amendments and no FY21 incentives, for targets of in respect exercised was discretion the year. outcomes for incentive The table below provides a summary of total remuneration for the Executive Directors for FY21. for Directors the Executive for a summary remuneration total of provides The table below Mark Carpenter James Gilmour Chris Morgan REMUNERATION POLICY

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 differences in the structure of the remuneration policy for the Executive Directors compared with other senior managers, which the Committee believes are necessary to reflect the different levels of responsibility. The two main differences 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 to explain the alignment between executive pay and that of the workforce generally but intends to do so during the year, now that it is looking more likely that there will be a more normal operating environment.

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 significant 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.

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 effective 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. 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 Base Salary To aid the recruitment of Base salaries will normally be reviewed Base salary levels are set at a While there is no maximum salary, Executive Directors of a annually by the Committee with any level to reflect the experience, increases will normally be in line with suitable calibre for the role increases typically taking effect from skills and responsibilities of the the typical level of increase awarded and to provide a core level 1 April each year. individual as well as the scope to other employees of the Group. of reward to reflect the and scale of their role. Base salaries for the Executive duties required. Increases to base salary will Directors were aligned to reflect the performance of the competitive market levels during individual and Company and FY21. external indicators such as For details of the current base salary inflation. levels for the Executive Directors see page 66.

Motorpoint Group plc 60 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 61

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Maximum OpportunityMaximum 10% of base salary for the CEO. At the At the CEO. base salary of for 10% period the pension this policy end of Directors all Executive for contribution the same percentage to will reduce thethat applies the majority of to workforce. pension appointments, new For the to will be aligned contribution the majority to available contribution the Accordingly, the workforce. of CFO appointed the newly pension for salary. of is 3% There is no maximum limit on the is no There but the provided the benefits of value of cost the total monitors Committee on a regular the benefit provision basis. salary. of 100% Performance Measurement Performance Not applicable. Not applicable. will normally be Performance and financial based on a mix of aligned to measures operational the of objectives the strategic business. will performance Financial by usually be represented although targets, PBT Adjusted the reserves the Committee include other measures to right in support the Company of as it sees fit.strategy targets performance Stretching taking intowill be determined and external internal account and will be set out on forecasts, basis in the a retrospective Remuneration, on Report Annual still be to unless considered sensitive. commercially Operation Executive Directors are eligible for a eligible for are Directors Executive personal the Group to contribution other nominatedpension plan, or any pension fund. personal Directors Executive appropriate, Where in a cash allowance instead receive may or a pension contributions, formal lieu of both. combination of eligible for are Directors Executive in cash, on an annualbonuses, payable the to subject are payments Bonus basis. annual performance of achievement targets. at the sole payable Annual bonuses are The the Committee. of discretion adjust the to has discretion Committee the annual of outturn formula-driven bonus calculation. subject to are All bonus payments and withholding recovery appropriate arrangements. The benefits offered to Executive Executive to offered The benefits medical family comprise Directors car. and company insurance an equivalent offer may The Committee more it is instead if it feels cash allowance suitable. be offered may benefits Other reasonable (including, in exceptional as appropriate and/or relocation circumstances, allowances).disturbance also be may Directors Executive expenses reasonable any for reimbursed their duties, and in performing incurred thereon. income tax payable any Purposeto strategy and link Annual Bonus improved encourage To financial and operational and align theperformance with Directors of interests the short Company term strategy. Pension market- provide To pensioncompetitive the for arrangements aid and to executives and retention. recruitment Benefits market- a provide To benefitscompetitive the executives for package and aid recruitment to retention. REMUNERATION POLICY CONTINUED

Purpose and link to strategy Operation Performance Measurement Maximum Opportunity

Long term incentives – Restricted Shares To encourage improved Restricted Shares will be granted to In order for Restricted Shares to Normally 75% of salary. financial and operational Executive Directors and selected vest, the Remuneration However, an individual maximum of performance and align the Senior Managers. Committee must be satisfied 100% of salary may apply in interests of Directors with Awards will normally be granted following that business performance is exceptional circumstances. the long-term Company the publication of the Company’s annual robust and sustainable and that strategy and the interests results each year. management has strengthened of shareholders through the business. In assessing this Restricted Shares may normally vest no share ownership. performance condition, the sooner than 50%, 25%, and 25% over Committee will consider three, four and five years from grant, financial and non-financial KPIs subject to service, and subject to an of the business as well as underpinning financial performance delivery against strategic condition. priorities. To the extent it is not Awards are additionally subject to a post satisfied with this performance vesting holding period during which time condition is met, the Committee vested shares may not be sold (other than may scale back the level of for tax) before five years from grant. vested awards including to zero. This holding period will continue post This performance assessment cessation of employment (to the extent will take place at the end of the that awards do not lapse). third year. 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.

All employee share plans To align the interests of The Company has adopted employee Not applicable. In line with statutory limits. Directors and other share plans in which the Executive employees with those of Directors are eligible to participate on the the shareholders through same terms as all other employees. share ownership.

Shareholding guidelines To align the interests of All Executive Directors are required to Not applicable. Not applicable. Directors with those of the build and maintain a shareholding shareholders through share equivalent in value to 200% of their ownership. 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.

Motorpoint Group plc 62 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 63

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Maximum OpportunityMaximum Not applicable. Current fee levels are set out in the are levels fee Current on Remuneration. Annual Report subject to are levels fee Aggregate the maximum limit set out in the Articles Association. of Performance Measurement Performance Not applicable. Not applicable. Operation All NEDs are encouraged to build and to encouraged All NEDs are in equivalent maintain a shareholding their annual fees. of 100% to value NEDs receive a fixed base fee for their for base fee a fixed NEDs receive supplementary plus on the Board, role such additional responsibilities for fees or chairing SID, of the role as performing Committees. the Board one of a Chairman receives The Non-Executive any and is not eligible for only, fee fixed fees. additional responsibility on an annual reviewed are levels Fee taking into be increased and may basis, such as the time factors account and market the role of commitment size in companies comparable of levels other broadly and and complexity companies. comparable be to NED will be entitled Each expenses all reasonable for reimbursed his of them in the course by incurred and has theduties the Company to indemnity insurancebenefit of their behalf on the Group maintainedby indemnifyingagainst liabilities them he/ parties third incur to potentially she may as Director. office his/her of as a result has been a material there Where in the year in time commitment increase to increased be temporarily may fees this. reflect Purpose and link to strategy To align the interests of align the interests To of with those Directors through shareholders ownership. share Share ownership guidelines ownership Share Fees for award a fair ensure To the to services provided Company. Choice of performance measures Choice of performance will be Measures cycles. award annual bonus and PSP future for measures performance the choice of as to flexibility retains The Committee performance The current sound financial performance. of the delivery ensure and to the business strategy reflect to as appropriate selected the business strategy. with the link to together on Remuneration, Report in the Annual disclosed are measures plan operation Incentive practice, with normal market rules and consistent their respective to plans according incentive the Company’s will operate The Committee regards. in a number of including flexibility relevant, rules where and HMRC the Listing Rules changes disposals, in share acquisitions, following awards to and making adjustments dealing with leavers This includes awards, timing of measures different set and/or adjust the targets the ability to also retains The Committee and acquisition activity. capital and other merger no longer that the conditions are determine which cause it to occur if events awards the annual bonus plan and outstanding PSP for less difficult to not materially and are their original purpose so that the conditions achieve is required and the amendment appropriate does outturn that the it considers calculation in the event the annual bonus of outturn adjust the formula-driven may The Committee satisfy. outcome. reward or employee experience shareholder overall underlying performance, not reflect under the annual granted awards of in respect the Committee of at the discretion be operated may and withholding provisions Recovery is a material there (including where in certain circumstances Shares and Restricted awards outstanding PSP bonus plan arrangements, or in the condition or bonus outcome, applicable performance in assessing any an error accounts, audited of restatement or misstatement damage). or reputational risk management of failure failure, on the part misconduct the participant, of corporate gross of event on Remuneration. in the Annual Report be explained relevant, where would, discretions the above use of Any Directors Non-Executive for Policy Remuneration Directors. the Non-Executive for is structured pay out how sets The table below REMUNERATION POLICY CONTINUED

Reward scenarios The bar charts below details how the composition of the Executive Directors’ remuneration package varies at different levels of performance. • Threshold includes fixed pay only (i.e. base salary, benefits and pension). • On-target includes fixed pay, 60% of maximum bonus, and full vesting of Restricted Shares. • Maximum includes fixed 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 effective as at 1 April 2021, and the value for benefits is the cost of providing those benefits in FY21. 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 £1,131,000

£1,000,000 £1,000,000 £860,000 35% 26% £806,000 £800,000 £710,000 31% £608,000 35% £600,000 27% 35% 31% 24% 31% £387,000 £400,000 36% 32% £264,000 25%

£200,000 100% 45% 39% 34% 100% 44% 37% 33%

£0,000 Threshold Target Maximum Maximum Threshold Target Maximum Maximum with 50% with 50% share price share price appreciation appreciation

Chief Executive Oicer Chief Financial Oicer

Fixed Pay Annual Bonus Restricted Shares

Approach to recruitment remuneration New Executive Director hires (including those promoted internally) will be offered 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-inflation 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 reflect the proportion of the period worked, and the Committee may set different 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 (eg 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 reflect 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 conflicts 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.

Motorpoint Group plc 64 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 65

3 months 3 months 3 months 3 months 9 months 9 months Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Notice period by Company or Director Company Notice period by N/A N/A Date of expiry 14 May 2022 May 14 2022 May 14 20 May 2023 May 20 6 March 2023 6 March 12 May 2016 12 May 14 May 2019 May 14 2019 May 14 20 May 2020 May 20 6 March 2020 6 March 11 January 2021 Date of contract / letter Date of contract The Company may (at its discretion) elect to terminate the employment by making a payment in lieu of notice equivalent in lieu of making a payment by the employment terminate elect to discretion) (at its may The Company notice. period of unexpired during any received have would Director the base salary the Executive to which in value on a pound for reduced mitigation, i.e. to (subject instalments in monthly notice will be payable in lieu of The payment period). up during the payment is taken employment/engagement pound basis if alternative the although in certain termination of circumstances in the event bonus payment any to right is no contractual There assessed and based on performance employment the period of a bonus for pay to discretion its exercise may Committee after the financial year. the end of to awards all unvested is for Shares) Restricted to plan rules relation (including in under the PSP treatment, The default lapse in full on cessation. death, injury, his/her because of within the Group or a Director if the participant ceases be an employee to However, the being sold out of work which they or the business for company their employing redundancy, retirement, disability, on the original will normally vest award then his/her the Committee, of at the discretion or in other circumstances Group on cessation vest to the award will be for position default the death, in the case of where (except date scheduled vesting employment). of conditions (if which the performance to (i) the extent subject to: will vest in this case is that an award position The default the period of to reference by the award of period; and (ii) the pro-rating the full performance been satisfied over have any) early vesting allow can decide to the Committee period. However, during the normal vesting in employment time served do so in the particular to it as appropriate if it regards an award of the pro-rating or eliminate reduce and/or circumstances. the plan and HMRC of with the terms in accordance plans will vest share under an all employee Outstanding shares legislation. of connection with a termination claims in or compromise or settle statutory entitlements any pay may The Committee the Company. of in the best interest considered where employment, also be provided. may legal costs of servicesOutplacement and reimbursement Treatment Provisions Mitigation Annual bonus awards Share Other Termination Termination payment Chris Morgan Directors Non-Executive Mary McNamara Mark Morris Cooper Adele Mansfield Keith as follows. are Directors Executive for contracts the current of elements The remuneration-related Executive Directors Executive Mark Carpenter Director Service contracts and payments for loss of office for Service and payments contracts and service agreements Directors’ All Executive set out below. are appointments of and letters service contracts Directors’ of The terms office. registered at the Company’s inspection for available are appointment of letters Directors’ Non-Executive 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 Gordon Hurst (resigned on 20 May 2020) Keith Mansfield (appointed on 20 May 2020) The Chairman and CEO attend meetings by invitation but are not members of the Committee. The Committee met five times during the year and attendance is set out in the table on page 50.

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 confirmed to the Committee that it adheres in all respects to the terms of the Code. Fees paid to Korn Ferry during the year were £36,090, which reflected the applicable hourly rates agreed with Korn Ferry. The Committee is satisfied, 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 FY21 Directors’ single figure of remuneration (audited) The table below shows the aggregate emoluments earned by the Directors of the Company during FY21 and also sets out the comparative information for FY20.

Total fixed Total variable Salary/fees Benefits1 Pension RSA2 remuneration Bonus PSP3 remuneration Total Director Period (£’000) (£’000) (£’000) (£’000) (£’000) (£’000) (£’000) (£’000) (£’000) FY21 231 2 27 206 466 – – – 466 Mark Carpenter FY20 274 2 27 – 303 107 – 107 410 FY21 72 1 9 – 82 – – – 82 James Gilmour4 FY20 215 1 22 – 238 – – – 238 FY21 58 1 2 – 61 – – – 61 Chris Morgan5 FY20 N/A N/A N/A N/A N/A N/A N/A N/A N/A FY21 92 N/A N/A N/A 92 N/A N/A N/A 92 Mark Morris FY20 100 N/A N/A N/A 100 N/A N/A N/A 100 FY21 49 N/A N/A N/A 49 N/A N/A N/A 49 Mary McNamara FY20 53 N/A N/A N/A 53 N/A N/A N/A 53 FY21 38 N/A N/A N/A 38 N/A N/A N/A 38 Adele Cooper FY20 3 N/A N/A N/A 3 N/A N/A N/A 3 FY21 40 N/A N/A N/A 40 N/A N/A N/A 40 Keith Mansfield6 FY20 – N/A N/A N/A N/A N/A N/A N/A – FY21 5 N/A N/A N/A 5 N/A N/A N/A 5 Gordon Hurst7 FY20 48 N/A N/A N/A 48 N/A N/A N/A 48

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. None of the Executive Directors had a PSP award which was eligible to vest in the year 4. Until his resignation on 24 August 2020 5. From his appointment on 11 January 2021 6. From his appointment on 20 May 2020 7. Until his resignation on 20 May 2020

Motorpoint Group plc 66 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 67

2 – – – – – – – 2

80 1 price

Stretch +0.5% Exercise Exercise £18.6m 177.30p 189.00p 230.00p 177.30p 277.20p 189.00p 230.00p 75 +ve Motorpoint Group plc Group Motorpoint £16.1m Performance required Performance Threshold Top 100 Top Vesting date Vesting 1 Feb 2021 1 Feb 1 Feb 2021 1 Feb 1 Feb 2022 1 Feb 1 Feb 2022 1 Feb 1 Feb 2024 1 Feb 1 Feb 2023 1 Feb 21 July 2020 20 July 2021 20 21 July 2020 20 July 2021 20 Annual Report and Accounts 2021 22 July 2022 22 July 2022 24 Aug 2023 Aug 24 24 Aug 2023* Aug 24 – – – – – – – – 2021 1,904 1,298 1,565 75,753 106,339 155,470 At 31 MarchAt – – – – – – – Awards Awards 2,030 1,904 1,565 83,403 the period 129,964 180,505 121,937 lapsed during – – – – – – – – – – – – – period Awards Awards 2,030 exercised exercised during the – – – – – – – – – – – – period Awards Awards granted 1,298 75,753 during the – – 2020 2,030 1,904 1,565 2,030 1,904 1,565 83,403 129,964 180,505 121,937 106,339 155,470 At 31 MarchAt 2018 PSP 2018 2019 PSP 2019 2020 PSP SAYE 2018 SAYE 2019 2020 SAYE 2020 2018 PSP 2018 Scheme 2019 PSP 2019 2020 PSP 2021 RSA 2021 2018 SAYE 2018 2019 SAYE SAYE 2019 2020 SAYE 2020 SAYE 2021 FY18 FY19 FY20 FY18 FY19 FY20 FY18 FY19 FY20 FY21 FY18 FY19 FY20 FY21 Year of Grant Year The first 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 fifth anniversaries of grant. of and fifth anniversaries on the fourth vests and then 25% the award of at 50% grant, of anniversary on their third vest shares the RSA of tranche The first Payable on a sliding scale between target levels target on a sliding scale between Payable survey For Work in the 100 Best Companies Star To rating Employer James Gilmour resigned on 24 August 2020. All his PSP awards lapsed upon cessation of his employment on 31 March 2021. 2021. on 31 March lapsed upon cessation his employment of awards All his PSP 2020. August on 24 James Gilmour resigned in FY21. awards any in January and he has not received 2021 joined the Board Chris Morgan James Gilmour 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. may due) taxes any (net of shares vested during which time any holding period will apply thereafter, post-vesting A two-year Performance Share Plan (‘PSP') (audited) Plan (‘PSP') Share Performance each for 2019, base salary of for and 125% 2018, base salary of for 100% of the value to PSP made under the Company’s were Awards the three over measured targets, growth EPS of and satisfaction employment, on continued is contingent Vesting Director. Executive the award. from financial years conditions. performance the below of achievement subject to grant, of the date of anniversary on the third vest will ordinarily The awards Growth in share of 0 – 3 year old car market year of 0 – 3 in share Growth * Name Mark Carpenter Outstanding share awards, including details of awards granted during the year and awards vesting based on performance to based on performance vesting awards and during the year granted including details of awards Outstanding awards, share 1. 2. Customer – NPS (audited) 2021 March 31 schemes. and other share under the PSP outstanding awards Directors’ table out details the Executive sets of The below Performance measure Performance PBT Adjusted (audited) earned in the year pay Details of variable Annual bonus growth, share market PBT, Adjusted subject to salary, of 100% of payment a maximum annual bonus eligible for were Directors Executive measures. engagement and employment customer their waived Directors As the Executive FY21. to set in relation that were conditions and targets performance out the sets The table below not assessed. was against targets performance bonus, the FY21 annual to entitlement Employee engagement Employee ANNUAL REPORT ON REMUNERATION CONTINUED

1. PSP 2019 PSP awards were made in July 2018 based on the average of the closing middle-market quotations of the share price during the five dealing days before grant, being 239.80 pence. The face value of the award at date of grant was £255,000 for Mark Carpenter. The EPS growth targets measured over the three financial years from 1 April 2018 to 31 March 2021 and actual performance achieved over this period is set out in the table below: EPS growth / (decline) (CAGR) Vesting Threshold 10% 25% Maximum 18% 100% Actual EPS growth / (decline) (21%) 0%

As actual EPS growth over the period was less than the threshold growth required, the 2019 PSP will lapse in full. The Committee did not exercise any discretion in determining the final vesting outcome. 2. PSP 2020 PSP awards were made in July 2019 based on the average of the closing middle-market quotations of the share price during the five dealing days before grant, being 220.4 pence. The face value of the award at date of grant for Mark Carpenter was £342,656. 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 financial years from 1 April 2019 to 31 March 2022. The targets are as follows: Market share EPS growth growth (CAGR) Vesting (0 – 2 year) Vesting Threshold 7.5% 12.5% 5.0% 12.5% Maximum 12% 50% 10.0% 50%

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 satisfied 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 fifth 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 five years from grant. 3. RSA 2021 RSA awards in the form of nil cost options (‘Options’) granted under the rules of the PSP approved on 24 August 2020 were based on the average of the closing middle-market quotations of the share price during the five dealing days before grant, being 271.4 pence.

Grant level as Share price Measurement period for Date of grant % of salary Shares awarded at grant date Face value of award performance underpin Mark Carpenter 24 August 2020 75% 75,753 271.4p £205,593 1 April 2020 to 31 March 2023

In order for Restricted Shares to vest, the Committee must be satisfied that business performance is robust and sustainable and that management has strengthened the business.

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 10% discount to the closing mid-market price the day before the invitation date. The maximum subscription offered is £3,600 (equivalent to £100 per month over the 36-month saving period).

Motorpoint Group plc 68 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 69

– 0% 0% FY21 260 94% 122% 352% 386% 230% 9,139% 24,293% 3 salary/fees 31/03/2021 Percentage ofPercentage – Motorpoint Group plc Group Motorpoint Total Total

At 31 March 2021 March 31 At 13,327 20,576 175,317 0% 65,500 65,500 65,000 410 FY20 39% 9,222,118 8,614,556 8,614,556 Annual Report and Accounts 2021 – – – – – – 4,767 31/03/2020 Unexercised Unexercised SAYE options SAYE 0% 0% 287 FY19 – – – – – – – 75,753 Unvested Restricted Share awards Share 1 – – – – – – – FY18 61% 443 N/A awards 31/03/2019 261,809 Unvested PSP Unvested 1 – 1 0% 262 FY17 13,327 13,327 N/A 20,576 175,317 65,500 65,000 Beneficially 8,879,789 8,614,556 8,614,556 owned shares owned 31/03/2018

31/03/2017 FTSESmallCap

2 Motorpoint 0 80 60 40 20

200 180 160 140 120 100 12/05/2016 No long-term incentive awards were eligible to vest over the relevant period. the relevant over vest eligible to were awards incentive No long-term divided by base salary as effective 31 March 2021. 31 March base salary as effective divided by Some of these shares may be held through nominees. be held through may theseSome of shares lapsed on cessation employment. of awards PSP unvested James All of Gilmour’s down. stepping of at date Shareholding (282p), 2021 31 March the period to price over share average month using three valued 2021, held at 31 March shares all fully owned of Calculated as the value Value of £100 invested at IPO (£) IPO at invested £100 of Value LTIP vesting (% of maximum) vesting LTIP Annual bonus (% of maximum) Executive Directors Executive Mark Carpenter 1. Total remuneration (£’000) remuneration Total The total remuneration figure for the CEO since 9 May 2016 is shown in the table below, along with the value of bonuses paid, and LTIP bonuses of paid, and LTIP along with the value in the table below, is shown 2016 since 9 May the CEO for figure remuneration The total the maximum opportunity. of as a percentage vesting, 2. 3. Details interests. share been no changes in the Directors’ have there this report, the publication of to 2021 March 31 During the period from on page 68. can be found lapse in July 2021 due to 2019, the PSP of as collateral. otherwise or use their shares loans against their shares hold any the Directors None of loss(audited) of office and for Directors to former Payments when he left the Company. 2020 August on 24 Director and ceased be a Board to 2020 in August his resignation James Gilmour tendered when he period from the for A payment in line with the Policy. lapsed on cessation employment of awards his outstanding incentive All of comprised of These instalments. paid in monthly payments was 31 January until 2021 2020 August on 24 leave placed on garden was this period. These during payments in benefit payments £2,000 Mr Gilmour also received in pension payments. salary and £9,000 £89,000 by reduced be would up during the notice period, these payments is taken employment that if alternative mitigation such subject to were the same value. directorships External companies. other listed at any directorships hold non-executive currently Directors the Executive None of Officer earnings history and Chief Executive return shareholder Total the over SmallCap Index the FTSE with that of compared performance Return Shareholder Total the Company’s shows The chart below has been SmallCap Index The FTSE 2021. 31 March to Exchange, Stock the London admission onto the Company’s of the date period from is a constituent. which the Company of as it is the index comparator as an appropriate chosen 1. Name Table of Directors’ share interests share (audited) of Directors’ Table set out in the are persons) his or her connected held by with interests (together 2021 as at 31 March each of Director interests The share table below. outstanding PSP any of 50% salary of and must retain 200% of the value to hold shares to the Policy by required are Directors Executive are Directors the Non-Executive is met. this guideline Additionally, until due) taxes any (net of vesting Shares Restricted or any vesting award in the table below. salary of or fees a percentage set out as are Shareholdings fee. their annual of 100% of the value to hold shares to invited James Gilmour Chris Morgan Non-Executive Directors Non-Executive Mark Morris Mary McNamara Adele Cooper Adele Gordon Hurst Gordon Keith Mansfield Keith ANNUAL REPORT ON REMUNERATION CONTINUED

Change in remuneration of Directors and employees The table below compares the difference in remuneration payable to the Directors in FY20 and FY21 to the average employee of the Company. For the purpose of this disclosure, these figures have been compiled comparing the average of all employees in the corresponding periods separately and are based on annualised figures for each year.

FY20 vs FY21 Base Annual salary/fees Benefits bonus % change % change % change6 Mark Carpenter (CEO) (15.7)% 0% (100)% Chris Morgan (CFO)1 N/A N/A N/A James Gilmour2 N/A N/A N/A Mark Morris (8.0)% 0% 0% Adele Cooper3 N/A N/A N/A Gordon Hurst4 N/A N/A N/A Keith Mansfield5 N/A N/A N/A Mary McNamara (7.5)% 0% 0% Average employee 4.5% 3.0% (4.5)%

1. Chris Morgan joined the Board in January 2021 2. James Gilmour stepped down from the Board in August 2020 3. Adele Cooper joined the Board on March 2020 4. Gordon Hurst stepped down from the Board on 20 May 2020 5. Keith Mansfield joined the Board on 20 May 2020 6. Includes performance related commission for employees

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.

25th 75th percentile Median percentile FY Method pay ratio pay ratio pay ratio 2021 Option A 12.7:1 11.3:1 7.1:1 2020 Option A 20.5:1 18.0:1 10.25:1

Disclosure of employee data used to calculate the ratio for FY21: 25th 75th percentile Median percentile £’000 £’000 £’000 Total pay and benefits of employees 21 23 37 Basic salary of employees 20 22 33

The table above sets out the CEO pay ratio for each financial 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 2021. In line with last year’s calculation, the ratios have been calculated in accordance with Option A, as this is the most accurate method of calculation. CEO pay has been calculated using the total single figure. The total pay for the employees comprises full time equivalent salary, benefits, pension and annual bonus payments relating to FY21 performance. At 11.3:1, the median CEO pay ratio has decreased for FY21 compared to FY20, this is primarily due to the voluntary cut to the CEO's salary in FY21 and also no bonus paying out this year compared to FY20 where a bonus was paid. In addition there is no LTIP payable for FY21. The Committee is satisfied the ratios are representative of Motorpoint’s pay and reward policies.

Relative importance of the spend on pay The following table sets out the percentage change in staff costs, dividends paid and share buyback in FY21 compared to the prior year.

Percentage FY20 (£m) FY21 (£m) change Total employee remuneration 28.8 25.6 (11)% Dividends paid 7.0 – (100)% Share buyback 13.1 – (100)%

Motorpoint Group plc 70 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 71

N/A 27.7% change 37,545 £7,500 £7,500 37,500 £5,000 Percentage £40,000 £100,000 Votes withheld Votes Motorpoint Group plc Group Motorpoint 6.9 6.9 Annual Report and Accounts 2021 1 April 2021 £255,000 £350,000 % votes against% votes N/A 93.1 93.1 % votes for % votes £274,125 1 April 2020 Benefits and pension medical private family receive to will continue Directors . Executive pension and benefits of the provision to proposed No changes are the CFO. salary of for and 3% the CEO salary of for will be 10% contributions Pension car. and a company insurance, Annual bonus an annual bonus will be eligible for Directors Executive FY22. for the annual bonus plan proposed of the structure no changes to are There and employee customer growth, share market PBT, Bonuses will be based on Adjusted salary. of 100% a maximum of up to payment be to targets the forward-looking considers The Committee independently. awarded with each measure measures engagement against them will be and performance targets of but full disclosure financial year, the current to relate as they sensitive commercially Annual Report. year’s in next provided in growing by earnings growth profitable delivering of objective strategic our key to linked and is directly Motorpoint is a financial KPI for PBT and groups, priority stakeholder two are and employees Our customers branches. online sales and opening new growing our local markets, and our Company. ensuring the success our strategy to of is key engagement and employee satisfaction customer of ensuring high levels incentives Long-term will be determined be granted to shares The number of base salary. of 75% equal to Shares Restricted of an award will receive Directors Executive grant. of the date before dealing days during the five quotations the shares of middle-market the closing of the average to with reference All awards the underpin. of the achievement subject to respectively, and five, four three, at years and 25% 25% 50%, will vest The shares the vest, to Shares Restricted for In order grant. from years five of a total tax) for any than sales pay to be held (other need to would the business. In and sustainable has strengthened and that management is robust business must be satisfied that performance Committee against as delivery the business KPIs of will consider financial and non-financial as well condition, the Committee assessing this performance vested of scale back the level may condition is met, the Committee it is not satisfied that this performance the extent priorities. To strategic year. the third place at the end of assessment will take This performance zero. including to awards, fees Directors’ Chairman and Non-Executive FY22 as follows: unchanged for remain the Company the NEDs of to payable The fees Implementation of the Policy in FY22 of the Policy Implementation is set out below. financial year during the forthcoming will be applied policy the remuneration A summary how of Base salaries the CEO that the salaries for determined the Committee in 2020, review policy as part the broader of letter, the Chairman’s in As explained be so as to 1 April 2020, from with effect respectively, and £250,000 £350,000 to and £215,000 £274,125 from increase should and CFO consulted. investors those supported by were These increases levels. mid-market to closer should be that the salary determined increases the Committee national lockdown under the first our showrooms of with the closure Subsequently, our new and Chris Morgan, resigned James Gilmour, our CFO, in 2020 Later significantly). reduced instead (and indeed salariespostponed were the CEO. for relevant so this issue only remained pension contribution), lower (with a significantly on a salary £255,000 of appointed was CFO, again and, with investors consulted the Committee and the outlook positive, profitably trading on and with the Company one year Now, 1 April from should be implemented as originally proposed, salary, the CEO’s to support, that the increase has determined received having workforce line with the average period will be in the policy of remainder the over or CFO the CEO for further salary increases Any 2021. circumstances. genuinely exceptional barring increase, set out below: are change, on year with the year The salaries, together Directors’ Remuneration Policy FY20 Policy Remuneration Directors’ Chris Morgan Mark Carpenter Directors’ Remuneration Report FY20 Report Remuneration Directors’ Votes cast Votes Statement of shareholder voting (2020 AGM voting) AGM (2020 voting of shareholder Statement for Report on: (a) the Remuneration the resolutions of in respect AGM 2020 at the Company’s results voting the table shows The following Policy. Remuneration Directors’ (b) and FY20; the 2020 Chair of the Audit Committee Chair of the Audit Senior Independent Director Other NEDs fees: responsibility Additional Committee Chair of the Remuneration Approval behalf by: and is signed on its June 2021 on 16 the Board by approved was This report Mary McNamara Chair Committee Remuneration June 2021 16 Non-Executive Chairman Non-Executive DIRECTORS’ REPORT

The Directors present their report, together with the audited financial statements of Group and the Company, for the year ended 31 March 2021. The Directors’ report comprises the Board biographies (on pages 46 and 47), the Corporate Governance report (from page 48 to page 51), the Directors’ report (from page 72 to page 75) and the Shareholder information section (on page 119). 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 1 Employee engagement Strategic report 31 SECR Strategic report 24 Stakeholder engagement Strategic report 22 and 23 Corporate Governance statement Chairman’s statement 48 Directors Board leadership and purpose 48 Remuneration report – directors’ beneficial interests shareholding 69 requirements Viability Statement Strategic report 38 Details of Long-Term Incentive Plan Remuneration report 62 Accounting policies, financial instruments and financial risk Financial statements 88 management

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 46 and 47, together with details of each Director’s skills, experience and current external appointments.

Directors’ indemnity insurance The Company has qualifying third party indemnity provisions in force for the benefit of its Directors in accordance with Section 234 of the Companies Act 2006 and has had Directors’ and Officers’ 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 2021 AGM.

Political donations No political donations were made by the Company during the year.

Employees 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 reflect 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 staff 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 find their circumstances change and they become disabled during their employment we would ensure total support and inclusion.

Motorpoint Group plc 72 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 73

4.76 3.07 9.55 9.85 3.96 11.27 19.68 Motorpoint Group plc Group Motorpoint % of issued shares at notification % of issued shares Annual Report and Accounts 2021 2,771,972 4,295,117 8,879,789 8,614,556 17,746,519 3,568,310 10,161,583 No. of Ordinary Shares of Ordinary No. Shareholder as at 31 May 2021 May as at 31 Shareholder CapitalImmersion Section 172: Stakeholder engagement Stakeholder Section 172: engagement, stakeholder to obligations and duties in relation statutory and governance legal, fiduciary, various its recognises The Board 2006. the Companies of Act Code and Section 172 the 2018 of specified in the Principlesincluding those and Provisions the Mary outcomes, engagement McNamara, and the related engagement employee of respect in the duties and responsibilities Regarding engage with (and oversee to with responsibility Director Non-Executive is the designated Committee, Remuneration Motorpoint’s Chair of for and decision making (the ‘Designated NED discussion in Board and experiences views relevant and involve with) employees engagement with) engagement Mary Engagement, engages with (and oversees Force Work As the Designated NED for Engagement’). Force Work their experiences. and understanding views relevant in discerning effective most that are in ways employees promote act to to endeavoured have obligations and duties, the Directors legal, statutory governance and their various of In the discharge stakeholders. various its of the interests for regard and in doing so have as a whole, members its the benefit of for the success Group the of The Board this report. of on page 23 provided are strategies engagement their associated and groups stakeholder Details the various of and decision-making processes discussions in related considered are interests that stakeholder matters, relevant discussion of in its ensures, policies and procedures. and inform Substantial shareholdings As Service. Information is published via a Regulatory the DTR to pursuant substantial shareholders by the Company to provided Information capital has the right capital. All such share issued share in its as set out below the interests has been notified of the Company 2021, at 31 May meetings. at general vote to Aberdeen Standard Investments Standard Aberdeen Mark Carpenter Mark Morris Forager Capital Management Forager Hunter Capital Punch Card CapitalPunch Card LP The shareholdings of Motorpoint Group plc Directors are listed within the Directors’ Remuneration Report. Remuneration within the Directors’ listed are plc Directors Group Motorpoint of The shareholdings Directors of the Powers authority to granted were The Directors constitution. the Company’s and 2006 set out in the Companies Act are the Directors of The powers these authorities shareholder in line with the latest institutional renew to will be asked Shareholders AGM. at the 2020 issue and allot shares AGM. guidelines the 2020 at of DirectorsAppointment and replacement the the Articles Association (the ‘Articles’), by of is governed the Company Directors, of and replacement the appointment to regard With at a general resolution ordinary by the Company by can be appointed legislation. Directors and related 2006 the Companies Act Code, 2018 and shall then be eligible AGM the next until office will hold such Director the Board, by is appointed If a Director the Board. meeting or by election at that meeting. for recommendation, Board subject to at this election or re-election for themselves will offer being eligible, each the Directors, of Code, the 2018 of 18 with Provision In accordance notice or by passing a special resolution either by office, from a Director can remove The Company retirements). any to (subject AGM year’s Directors. all the other by being given and His appointment Officer. and Chief Financial Director as an Executive January 2021 on 11 the Board to appointed was Chris Morgan AGM. 2021 election at the Company’s both subject to are the Board of membership continuing Dividends the Board. by No final dividend is recommended capitalShare each. £0.01 of with a nominal value Shares Ordinary capital comprised 90,189,885 issued share the Company’s 2021, As at 31 March DIRECTORS’ REPORT CONTINUED

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 Benefit Trust As at 31 March 2021, the Motorpoint Employee Benefit Trust held 34,841 Ordinary Shares (2020: 16,440). Further information about share capital can be found in note 25 of the Financial Statements.

Change of control provisions The Directors are not aware of there being any significant agreements that contain any material change of control provisions to which the Company is a party other than in respect of the financing 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. Purchase of own shares At the Company’s AGM on 24 August 2020, shareholders approved an authority for the Company to make market purchases of its own shares up to a maximum of 9,018,989 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 2021 AGM.

Allotment of shares At the Company’s AGM on 24 August 2020, shareholders approved an authority for the Company to allot ordinary shares up to a maximum nominal amount of £300,633 (being approximately one-third of the Company’s issued share capital at that time) increasing to £601,266 (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 2021 AGM.

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 Group. None. 9.8.4(2) Unaudited financial information (LR 9.2.18R). None. 9.8.4(4) Long-term incentive scheme information involving Board Details can be found on page 62 of the Directors’ Directors (LR 9.4.3R). 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 None. subsidiary undertakings. 9.8.4(9) Listed company is a subsidiary of another company. Not applicable. 9.8.4(10) Contracts of significance involving a Director or a controlling None. shareholder. 9.8.4(11) Contracts for the provision of services by a controlling None. shareholder. 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 beneficial 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 beneficial property. 9.8.4(14) Agreement with controlling shareholder. None.

Motorpoint Group plc 74 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 75

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Chris Morgan Chris Morgan OfficerChief Financial June 2021 16 Going Concern and has and financial forecasts market reviews regularly The Group basis. on a going concern prepared are The financial statements March late from six weeks for closed were operations the Group Coronavirus of a result As markets. key in its prospects trading its reviewed these All of closures lockdowns. imposed Government of as a result further closure to periods of subject were branches The Group’s 2020. and secured this closure of limit the impact actions to immediate took The Group and liquidity. short performance impacted term directly This if required. cash flows support to operational facility, overdraft £15.0m uncommitted including an additional additional finance facilities, levels maintain reduced able to was the Group closure of periods During the later and not been renewed. expired not used and has now was and contactless collections. home delivery salesof through the and considered scenarios, multiple reopening of including the impact the Group, of the latest forecasts has reviewed The Board the financing arrangements. obligations of signing the accounts. of the point from at least months of on a period 12 focuses going concern the Group considering of the purpose For at the point to volumes reducing the Group, in considering the going concern status of test approach stress a reverse has taken The Board whichever trading, continue to required or depletes liquid resources with banking covenants no longer compliant is either which the Group lines cost including marketing spend on specific variable the model including: reducing built into Plausible mitigating actions were is earlier. existing of taking advantage commitments, notably stock most sales pausing new team costs commissions, expenses, trading and branch dividends are buybacks/ capital spend and share which expansionary the period for support, and extending and confirmed Governmental under current be available only been assumed to which have support initiatives the Government of exception the suspended. With the going concern period. throughout be performed theselegislation, all of actions could conceivably despite the positive against FY20, 31% of in excess reduction volume period of that a prolonged model demonstrated test stress The reverse FY22 implausible. which is considered breach, a covenant before required was on Tees, and Stockton opening Swansea of impact expected lockdown. periods of enforced government no further prolonged FY21 given exceed to expected and are started strongly have volumes could initiatives cash saving the previous while some of optimism, and therefore FY22 cautiously but with renewed approaches The Group plans. growth pre-Covid in its invest has started to be maintained the Group in the short term, the viability of the continuing into additional insight provide to performance end trading year the post made use of have The Directors the of strength the continuing to adds further evidence comfort end, this business. While only a shortthe year period has passed since in the stressed and cash reserves of and sufficiency the Group liquidity of historical the continued Given market. in an active Group the going over existence in operational continue to resources has adequate has concluded that the Group modelled, the Board scenarios the preparing adopt the going concern basis in to continue they Accordingly, thereafter. future the foreseeable concern period and into financial statements. consolidated June 2021. on 16 the Board by approved was The Annual Report the Board On behalf of STATEMENT OF DIRECTORS’ RESPONSIBILITIES

The Directors are responsible for preparing the Annual Report and Directors’ confirmations the audited consolidated financial statements in accordance with The Directors consider that the Annual Report, taken as a whole, is applicable law and regulation. fair, balanced and understandable and provides the information Company law requires the Directors to prepare financial statements necessary for shareholders to assess the Group’s and Company’s for each financial year. Under that law the Directors have prepared position and performance, business model and strategy. the Group financial statements in accordance with international Each of the current Directors, whose names and function are listed accounting standards in conformity with the requirements of the on page 46 and page 47 confirm that to the best of their knowledge: Companies Act 2006 and the company financial statements in accordance with United Kingdom Generally Accepted Accounting • the Group financial statements, which have been prepared in Practice (United Kingdom Accounting Standards, comprising FRS accordance with international accounting standards in 102 ‘The Financial Reporting Standard applicable in the UK and conformity with the requirements of the Companies Act 2006 Republic of Ireland’, and applicable law). Additionally, the Financial and international financial reporting standards adopted pursuant Conduct Authority’s Disclosure Guidance and Transparency Rules to Regulation (EC) No 1606/2002 as it applies in the European require the Directors to prepare the Group financial statements in Union, give a true and fair view of the assets, liabilities, financial accordance with international financial reporting standards adopted position and profit of the Group; pursuant to Regulation (EC) No 1606/2002 as it applies in the • the Company financial statements, which have been prepared in European Union. accordance with United Kingdom Accounting Standards, comprising FRS 102, give a true and fair view of the assets, Under company law the Directors must not approve the financial liabilities, financial position and loss of the Company; and statements unless they are satisfied that they give a true and fair view of the state of affairs of the Group and Company and of the • the Strategic Report includes a fair review of the development profit or loss of the Group and Company for that period. In and performance of the business and the position of the Group preparing the financial statements, the Directors are required to: and Company, together with a description of the principal risks and uncertainties that it faces. • select suitable accounting policies and then apply them In the case of each Director in office at the date the Directors’ report consistently; is approved: • state whether applicable international accounting standards in conformity with the requirements of the Companies Act 2006 • so far as the Director is aware, there is no relevant audit and international financial reporting standards adopted pursuant information of which the Group and Company’s auditors are to Regulation (EC) No 1606/2002 as it applies in the European unaware; and Union have been followed for the group financial statements and • they have taken all the steps that they ought to have taken as a United Kingdom Accounting Standards, comprising FRS 102 have Director in order to make themselves aware of any relevant audit been followed for the company financial statements, subject to information and to establish that the Group and Company’s any material departures disclosed and explained in the financial auditors are aware of that information. statement; This confirmation is given and interpreted in accordance with the • make judgements and accounting estimates that are reasonable provisions of section 418 of the Companies Act 2006. and prudent; and • prepare the financial statements on the going concern basis unless it is inappropriate to presume that the Group and Company will continue in business. The Directors are also responsible for safeguarding the assets of the Group and the Company and hence for taking reasonable steps for the prevention and detection of fraud and other irregularities. The Directors are responsible for keeping adequate accounting records that are sufficient to show and explain the Group’s and Company’s transactions and disclose with reasonable accuracy at any time the financial position of the Group and Company and enable them to ensure that the financial 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 financial statements may differ from legislation in other jurisdictions.

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Financial Statements

78 Independent auditors’ report 84 Consolidated statement of comprehensive income 85 Consolidated balance sheet 86 Consolidated statement of changes in equity 87 Consolidated cash flow statement 88 Notes to the consolidated financial statements 111 Company balance sheet 112 Company statement of changes in equity 113 Notes to the company financial statements 117 Alternative performance measures 118 Glossary 119 Shareholder information and advisers

Motorpoint Group plc Annual Report and Accounts 2021 77 INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF MOTORPOINT GROUP PLC

Report on the audit of the financial statements Opinion In our opinion: • Motorpoint Group Plc’s group financial statements and company financial statements (the “financial statements”) give a true and fair view of the state of the group’s and of the company’s affairs as at 31 March 2021 and of the group’s profit and the group’s cash flows for the year then ended; • the group financial statements have been properly prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006; • the company financial 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 financial statements have been prepared in accordance with the requirements of the Companies Act 2006. We have audited the financial statements, included within the Annual Report and Accounts 2021 (the “Annual Report”), which comprise: the Consolidated balance sheet and Company balance sheet as at 31 March 2021; the Consolidated statement of comprehensive income, Consolidated cash flow statement, Consolidated statement of changes in equity and Company statement of changes in equity for the year then ended; and the notes to the financial statements, which include a description of the significant accounting policies. Our opinion is consistent with our reporting to the audit committee.

Separate opinion in relation to international financial reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union As explained in note 2 to the financial statements, the group, in addition to applying international accounting standards in conformity with the requirements of the Companies Act 2006, has also applied international financial reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union. In our opinion, the group financial statements have been properly prepared in accordance with international financial reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union.

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 financial statements section of our report. We believe that the audit evidence we have obtained is sufficient 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 financial statements in the UK, which includes the FRC’s Ethical Standard, as applicable to listed public interest entities, and we have fulfilled 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. 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 profit before tax.

Key audit matters • Going concern and impairment consideration relating to COVID-19 (group and company) • Inventory valuation (group)

Materiality • Overall group materiality: £845,000 (2020: £5,100,000) based on 5% (2020: 0.5%) of three year average adjusted profit before tax (2020: revenue). • Overall company materiality: £720,000 (2020: £1,000,000) based on 1% of total assets, restricted by component materiality allocation. • Performance materiality: £634,000 (group) and £540,000 (company).

The scope of our audit As part of designing our audit, we determined materiality and assessed the risks of material misstatement in the financial statements.

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 We have reviewed the board approved budget/ forecasts which budget/ forecasts approved the board reviewed have We support to the going COVID-19, of include specific consideration assessments. concern assumptions and impairment to used in the above and forecasts the budgets compared have We trading of experience end data and management’s year post actual COVID-19. of a year through used in management’s assumptions challenged the key have We assess the impact on to models the downside models and reviewed headroom. liquidity and impairment covenant mitigations in the models are planned cost that any verified have We and feasible. the Directors of within the control models management’s of the arithmetic accuracy verified have We above. mentioned finance and stock various of confirmed the availability have We banking facilities. the COVID-19 to in relation disclosures management’s reviewed We test scenarios with the stress be consistent them to impact and found set out going concern are to Our conclusions relating performed. below. sales assess margins to afterdate a sample of tested have We provision. the inventory to end and compared year post achieved models in management’s of the arithmetic accuracy verified have We provision. calculating the inventory models to used in management’s inputs a sample of tested have We party evidence. third appropriate assumptions used in management’s challenged the key have We assess including sensitising the assumptions to the impact. models, a through trading of experience management’s reviewed have We of margins of and challenged the forecast COVID-19 of year unsold inventory. remaining How our audit addressed the key audit matter the key our audit addressed How • • • • • • • • • • • • Inventory valuation (group) valuation Inventory the 4 of and note report) Committee (Audit page 54 to Refer financial statements. consolidated in the near to levels trading uncertainty over the future Given risk a heightened exist continues to there medium term, net realisable of being in excess valuation inventory around value. Going concern and impairment consideration relating to relating Going consideration concern and impairment and company) (group COVID-19 the 4 of and note report) Committee page 53 (Audit to Refer financial statements. consolidated required The ongoing economic uncertainty COVID-19 due to consider the impact on the going to and auditors the Directors on the assets various of concern assessment and the valuation and and equipment plant balance sheet, specifically property, use assets. of right Key audit matter Key the audit scope tailored we How as a on the financial statements an opinion give be able to to enough work performed that we ensure our audit to the scope of tailored We and the industry in which and controls, processes the accounting and the company, the group of the structure account taking into whole, operate. they across sites spread retail which has 14 Limited, Motorpoint entity, is one trading UK. based in the There subsidiaries and all its are The Group their to due components, be significant to considered were the Company, Plc, Group Motorpoint and the UK. Limited Motorpoint performed The audit work these carried out on both of components. were scope audits Full financial statements. the Group to contribution as a financial statements our opinion on the Group needed for we us the evidence Plc gave Group and Motorpoint Limited Motorpoint over tax. before and profit revenue the Group’s of 100% entities cover These two whole. audit team. the Group by completed was components, on significant including work All audit work, Key audit matters Key the financial audit of significance in the most of judgement, were professional that, in the auditors’ matters those are audit matters Key fraud) (whether or not due to misstatement material of assessed significant period and include the most risks the current of statements audit; in the resources of the allocation audit strategy; on: the overall effect had the greatest which including those the auditors, by identified thereon, procedures our of on the results make we comments and any team. These the engagement of matters, the efforts and directing do not provide and we our opinion thereon, and in forming as a whole, the financial statements our audit of of in the context addressed were on these opinion matters. a separate our audit. by identified all risks list of This is not a complete no longer included is last year, audit matter a key which was transition, 16 IFRS this year. audit matter key is a new valuation Inventory with last year. consistent are below audit matters the key Otherwise, 2020. which was transition of the year specific to because it was INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF MOTORPOINT GROUP PLC CONTINUED

Materiality The scope of our audit was influenced 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 financial statement line items and disclosures and in evaluating the effect of misstatements, both individually and in aggregate on the financial statements as a whole. Based on our professional judgement, we determined materiality for the financial statements as a whole as follows:

Financial statements – group Financial statements – company Overall materiality £845,000 (2020: £5,100,000). £720,000 (2020: £1,000,000). How we determined it 5% (2020: 0.5%) of three year average adjusted profit before 1% of total assets, restricted by component tax (2020: revenue) materiality allocation.

Rationale for Motorpoint is seeking to grow market share through its Motorpoint Group Plc (the Company) is the benchmark applied business model and opening new sites in an industry that investment vehicle for the Group and operates on low profit margins. With volume and revenue therefore total assets is a generally accepted being key drivers for the business, we have historically auditing benchmark. applied a revenue benchmark to determine materiality. However, we continued to apply a lower profit based materiality of £0.9m in FY20 for certain financial statement line items depending on the nature of the balances and the potential impact on profit. Given the group’s increasing focus on margin and ultimately profit during the course of FY21, and further to our discussions with the Audit Committee, we have used a profit based materiality benchmark for FY21.

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 £720,000 and £803,000. We use performance materiality to reduce to an appropriately low level the probability that the aggregate of uncorrected and undetected misstatements exceeds overall materiality. Specifically, 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% of overall materiality, amounting to £634,000 for the group financial statements and £540,000 for the company financial statements. In determining the performance materiality, we considered a number of factors - the history of misstatements, risk assessment and aggregation risk and the effectiveness of controls - and concluded that an amount in the middle of our normal range was appropriate. We agreed with the audit committee that we would report to them misstatements identified during our audit above £40,000 (group audit) (2020: £100,000) and £40,000 (company audit) (2020: £100,000) as well as misstatements below those amounts that, in our view, warranted reporting for qualitative reasons.

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 the procedures as described in our Going concern and impairment consideration relating to COVID-19 key audit matter. Based on the work we have performed, we have not identified any material uncertainties relating to events or conditions that, individually or collectively, may cast significant doubt on the group’s and the company’s ability to continue as a going concern for a period of at least twelve months from when the financial statements are authorised for issue. In auditing the financial statements, we have concluded that the Directors’ use of the going concern basis of accounting in the preparation of the financial 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 financial 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.

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 The Directors’ confirmation that they have carried out a robust assessment of the emerging and principal risks; assessment the emerging of carried out a robust have confirmation that they The Directors’ and an risks identify in place to emerging are what procedures that describe principal risks, those in the Annual Report The disclosures being managed or mitigated; these are how of explanation of adopt the going concern basis to it appropriate considered about whether they in the financial statements statement The Directors’ do to continue to ability and company’s uncertainties material the group’s to any of them, and their identification in preparing accounting the financial statements; of approval of the date from months at least a period of twelve so over the and why assessment the period this covers prospects, and company’s their assessment the group’s of as to explanation The Directors’ and period is appropriate; and in operation continue will be able to that the company expectation a reasonable have whether they as to statement The Directors’ necessary any to attention drawing disclosures related assessment, its the period of including any due over fall liabilitiesmeet its as they qualifications or assumptions. the and provides balanced and understandable, is fair, as a whole, taken consider the Annual Report, that they statement The Directors’ business model and strategy; performance, position, and company’s assess the group’s to the members necessary for information and systems; control and internal risk management of effectiveness of that describes the review the Annual Report The section of the audit committee. of describing the work the Annual Report The section of • • • • substantially less in scope than an audit and only was the group viability of the longer-term regarding statement the Directors’ of Our review is in alignment supporting checking that the statement their statement; process making inquiries of considering the Directors’ and consisted the financial with is consistent Code; whether the statement and considering Governance the UK Corporate of provisions with the relevant the audit. of obtained in the course and their environment and company the group of and understanding and our knowledge statements the corporate of elements concluded that each the following of have as part our audit, we of undertaken In addition, based on the work obtained during the audit: our knowledge and with the financial statements consistent is materially statement governance • • • compliance with the company’s to relating statement when the Directors’ report to our responsibility of in respect report nothing to have We the by review for the Code of specified under the Listing Rules provision a relevant from a departure disclose the Code does not properly auditors. Corporate governance statement governance Corporate viability and that part the of going concern, longer-term to in relation statements the Directors’ review us to require The Listing Rules Code specified Governance the UK Corporate of with the provisions compliance the company’s to relating statement governance corporate describedin the are as other information statement governance the corporate to with respect Our additional responsibilities our review. for this report. section of on other information Reporting governance the corporate of elements concluded that each the following of have as part our audit, of we undertaken on the work Based and our knowledge with the financial statements consistent is materially report governance included within the Corporate statement, to: in relation to attention add or draw to nothing material have obtained during the audit, and we • The other information comprises all of the information in the Annual Report other than the financial statements and our auditors’ report report and our auditors’ other than the financial statements in the Annual Report comprises the information all of The other information the other does not cover the financial statements Our opinion on the other information. for responsible are The Directors thereon. form any in this report, stated otherwise explicitly the extent to except an audit opinion or, do not express we and, accordingly, information thereon. assurance of whether consider so, and, in doing the other information read is to our responsibility the financial statements, audit of In connection with our obtainedaudit, in the or otherwise to appears or our knowledge with the financial statements inconsistent is materially the other information procedures perform to required are we misstatement, or material inconsistency material identify an apparent If we misstated. be materially If, the other information. of misstatement or a material statements the financial of misstatement is a material whether there conclude to report to required are we this other information, of misstatement is a material there conclude that we performed, have we based on the work on these based responsibilities. report nothing to have We that fact. the UK Companies Act by required whether the disclosures also considered we report, and Directors’ report the Strategic to respect With been included. have 2006 as certain opinions and matters report us also to requires 2006 the audit, of the Companies Act in the course undertaken on our work Based described below. report and Directors’ report Strategic for report and Directors’ report in the Strategic given the audit, the information of in the course undertaken In our opinion, based on the work with applicable legal in accordance and has been prepared the financial statements with is consistent 2021 ended 31 March the year requirements. did the audit, of we obtained in the course and their environment and company the group of and understanding the knowledge of In light report. and Directors’ report in the Strategic misstatements material not identify any Remuneration Directors’ with the Companies in accordance prepared has been properly be audited to on remuneration In our opinion, the part the Annual report of 2006. Act Reporting on other information on other Reporting INDEPENDENT AUDITORS’ REPORT TO THE MEMBERS OF MOTORPOINT GROUP PLC CONTINUED

Responsibilities for the financial statements and the audit Responsibilities of the Directors for the financial statements As explained more fully in the Statement of directors’ responsibilities, the Directors are responsible for the preparation of the financial statements in accordance with the applicable framework and for being satisfied 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 financial statements that are free from material misstatement, whether due to fraud or error. In preparing the financial 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 financial statements Our objectives are to obtain reasonable assurance about whether the financial 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 influence the economic decisions of users taken on the basis of these financial 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 identified that the principal risks of non-compliance with laws and regulations related to the Listing Rules, UK tax legislation, Financial Conduct Authority regulations, employment law, health & safety, GDPR and modern slavery, and we considered the extent to which non-compliance might have a material effect on the financial statements. We also considered those laws and regulations that have a direct impact on the financial statements such as the Companies Act 2006. We evaluated management’s incentives and opportunities for fraudulent manipulation of the financial 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 and audit of the financial statement disclosures to underlying supporting documentation; • challenging assumptions and judgements made by management in their significant 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. 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 reflected in the financial 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 financial statements is located on the FRC’s website at: www.frc.org.uk/ auditors responsibilities. 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.

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Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021

we have not obtained all the information and explanations we require for our audit; or for require we and explanations not obtained the information all have we from not been received our audit have for adequate or returns the company, by kept not been have records accounting adequate us; or by not visited branches not made; or are law specified by remuneration Directors’ of certain disclosures with the not in agreement are be audited to on remuneration and the part the Annual report of financial statements the company and returns. records accounting Mark Skedgel (Senior Statutory Auditor) Skedgel Mark LLP PricewaterhouseCoopers and on behalf of for June 2021 16 Appointment the for audit the financial statements 2015 to September on 18 Directors its by Limited Motorpoint of as auditors appointed first were We ended 31 March the year for the financial statements audit to 2016 February on 29 reappointed and subsequently 2015 ended 31 March year we Plc, Group Motorpoint of formation and the Holdings Limited Motorpoint headed by the group of the reorganisation Following 2016. ended 31 March the year for audit the financial statements to 2016 October Plc on 28 Group Motorpoint of the Directors by appointed were 2015 to ended 31 March the years covering is 7 years, engagement uninterrupted total The period of financial periods. and subsequent 2017 2021. 31 March and Statutory Auditors Accountants Chartered Midlands East Companies Act 2006 exception reporting exception 2006 Companies Act in our opinion: if, you to report to required are we 2006 Companies the Under Act • • • • this responsibility. arising from report to no exceptions have We Other required reporting Other required CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 31 MARCH 2021

2021 2020 Note £m £m Revenue 5 721.4 1,018.0 Cost of sales 6 (658.9) (939.1) Gross profit 62.5 78.9 Operating expenses 6 (49.9) (56.6) Operating profit 12.6 22.3 Finance expense 10 (2.9) (3.5) Profit before income tax 9.7 18.8 Income tax expense 11 (2.1) (3.6) Profit and total comprehensive income for the year attributable to equity holders of the parent 7.6 15.2

Earnings per share attributable to equity holders of the parent Basic 12 8.4p 16.4p Diluted 12 8.4p 16.4p

The Group’s activities all derive from continuing operations. The Group has no other comprehensive income (2020: £Nil). Total comprehensive income for the year is equal to the profit for the financial year. The notes on pages 88 to 110 are an integral part of these consolidated financial statements.

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– £m 0.1 0.9 3.6 0.9 4.4 1.3 (0.8) (2.1) (0.2) (2.3) (0.2) 2020 20.2 20.0 20.2 10.8 61.8 41.6 18.9 (45.2) (43.1) (10.0) 189.7 127.9 111.8 (169.5) (124.3) (111.6) Motorpoint Group plc Group Motorpoint – – £m 0.1 0.9 6.0 1.7 7.7 1.2 (0.1) (0.8) (2.0) (0.1) (2.4) 2021 27.6 27.5 27.6 15.6 60.9 43.6 16.1 (48.9) (46.9) 204.7 143.8 128.4 (177.1) (128.2) (125.7) Annual Report and Accounts 2021 28 27 26 25 22 15 22 15 21 21 20 19 11 18 17 16 15 14 Note AS AT 31 MARCH 2021 MARCH 31 AT AS CONSOLIDATED BALANCE SHEET SHEET BALANCE CONSOLIDATED C Morgan Officer Chief Financial M Carpenter The consolidated financial statements on pages 84 to 110 were approved by the Board of Directors on 16 June 2021 and were signed on its and were June 2021 on 16 Directors of the Board by approved were 110 to on pages 84 financial statements The consolidated behalf by: Officer Chief Executive Plc Group Motorpoint number 10119755 Registered TOTAL EQUITY TOTAL Retained earnings Retained EBT reserve EBT Capital reorganisation reserve Capital reorganisation Capital redemption reserve Capital redemption EQUITY capitalCalled up share NET ASSETS TOTAL LIABILITIES TOTAL Total non-current liabilities non-current Total Provisions Non-current liabilities Non-current liabilitiesLease Net current assets current Net Total current liabilities current Total Provisions Lease liabilitiesLease Contract liabilitiesContract Trade and other payables, excluding contract liabilities contract excluding and other payables, Trade LIABILITIES liabilitiesCurrent Borrowings TOTAL ASSETS TOTAL Total current assets current Total Cash and cash equivalents Current tax receivable Current Trade and other receivables Trade Current assetsCurrent Inventories Total non-current assets non-current Total Deferred tax asset Deferred Right-of-use assets Right-of-use ASSETS assetsNon-current plant and equipment Property, CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2021

Capital Capital Called up redemption reorganisation Retained share capital reserve reserve EBT reserve earnings Total equity Note £m £m £m £m £m £m Balance at 1 April 2019 1.0 – (0.8) – 25.8 26.0 Profit and total comprehensive income for the year – – – – 15.2 15.2 Transactions with owners in their capacity as owners: Share‑based payments 31 – – – – (0.9) (0.9) Buyback and cancellation of shares 25 (0.1) 0.1 – – (13.1) (13.1) Final dividend for the year ended 31 March 2019 13 – – – – (4.7) (4.7) Interim dividend for the year ended 31 March 2020 13 – – – – (2.3) (2.3) (0.1) 0.1 – – (21.0) (21.0) Balance at 31 March 2020 0.9 0.1 (0.8) – 20.0 20.2 Profit and total comprehensive income for the year – – – – 7.6 7.6 Transactions with owners in their capacity as owners: Share‑based payments 31 – – – – 0.2 0.2 EBT share purchases and commitments 28 – – – (0.4) – (0.4) Share-based compensation options satisfied through the EBT 28 – – – 0.3 (0.3) – – – – (0.1) (0.1) (0.2) Balance at 31 March 2021 0.9 0.1 (0.8) (0.1) 27.5 27.6

The notes on pages 88 to 110 are an integral part of these consolidated financial statements.

Motorpoint Group plc 86 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 87

– £m (3.0) (3.0) (0.9) (7.0) 2020 (6.4) (1.9) (1.6) 10.8 10.8 13.8 29.0 23.3 33.2 (14.0) (19.0) (13.1) (12.3) (12.3) Motorpoint Group plc Group Motorpoint - – – £m 6.0 6.0 2.5 6.1 6.7 (4.8) (3.6) (0.4) (3.6) (2.8) (1.3) (1.6) 2021 10.8 12.4 (14.0) (10.0) Annual Report and Accounts 2021 25 13 14 30 Note CONSOLIDATED CASH FLOW STATEMENT FLOW CASH CONSOLIDATED FOR THE YEAR ENDED 31 MARCH 2021 MARCH 31 ENDED YEAR THE FOR Net cash and cash equivalents comprises:Net cash and cash equivalents Cash at bank Cash and cash equivalents at end of year at Cash and cash equivalents Cash at the beginning of the year and cash equivalents Net decrease in cash and cashNet equivalents Net cash usedin financing activities Net Repayment of borrowings Repayment Proceeds from borrowings from Proceeds Repayment of leases Repayment Payments to satisfy employee share plan obligations share to satisfy employee Payments Payments to acquire own shares own to acquire Payments Cash flows from financing activities financing from Cash flows Dividends paid Net cash generated from / (used in) investing activities / (used in) investing from cash generated Net Proceeds from disposal of property, plant and equipment and right-of-use assets and right-of-use plant and equipment disposal of property, from Proceeds Cash flows from investing activities investing from Cash flows plant and equipment of property, Purchases Net cash generated from operating activities operating from cash generated Net Income tax paid Interest paid on borrowings and financing facilities paid on borrowings Interest Interest paid on lease liabilities Interest Cash flows from operating activities operating from Cash flows operations Cash from generated NOTES TO THE FINANCIAL STATEMENTS

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 office is Chartwell Drive, West Meadows Industrial Estate, Derby, England, United Kingdom, DE21 6BZ. The consolidated financial statements of the Group as at and for the year ended 31 March 2021 comprise the Company, all of its subsidiaries and the Motorpoint Group Plc Employee Benefit Trust (the ‘EBT') as listed on page 115, together referred to as the Group. These financial 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 43.

2. Summary of significant accounting policies The principal accounting policies applied in the preparation of these consolidated financial statements are set out below. The policies have been consistently applied to all years presented, unless otherwise stated. (a) Basis of preparation These consolidated financial statements of the Group have been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and international financial reporting standards adopted pursuant to Regulation (EC) No 1606/2002 as it applies in the European Union together referred to as ‘IFRS’. The financial statements have been prepared under the historical cost convention. The preparation of financial 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 significant to the consolidated financial statements, are disclosed in note 4. (b) Going concern The financial statements are prepared on a going concern basis. The Group regularly reviews market and financial forecasts and has reviewed its trading prospects in its key markets. As a result of Coronavirus the Group operations were closed for six weeks from late March 2020. The Group’s branches were subject to further periods of closure as a result of Government imposed lockdowns. All of these closures directly impacted short term performance and liquidity. The Group took immediate actions to limit the impact of this closure and secured additional finance facilities, including an additional uncommitted £15.0m overdraft facility, to support operational cash flows if required. This was not used and has now expired and not been renewed. During the later periods of closure the Group was able to maintain reduced levels of sales through home delivery and contactless collections. The Board has reviewed the latest forecasts of the Group, including the impact of multiple reopening scenarios, and considered the obligations of the financing arrangements. 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 reverse stress test approach in considering the going concern status of the Group, reducing volumes to the point at which the Group is either no longer compliant with banking covenants or depletes liquid resources required to continue trading, whichever is earlier. Plausible mitigating actions were built into the model including: reducing spend on specific variable cost lines including marketing and branch trading expenses, team costs most notably sales commissions, pausing new stock commitments, taking advantage of existing and confirmed Governmental support, and extending the period for which expansionary capital spend and share buybacks/ dividends are suspended. With the exception of the Government support initiatives which have only been assumed to be available under current legislation, all of these actions could conceivably be performed throughout the going concern period. The reverse stress test model demonstrated that a prolonged period of volume reduction in excess of 31% against FY20, despite the positive impact expected of opening Swansea and Stockton on Tees, was required before a covenant breach, which is considered implausible. FY22 volumes have started strongly and are expected to exceed FY21 given no further prolonged government enforced periods of lockdown. The Group approaches FY22 cautiously but with renewed optimism, and therefore while some of the previous cash saving initiatives could be maintained in the short term, the Group has started to invest in its pre-Covid growth plans. 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 sufficiency 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 financial statements.

Motorpoint Group plc 88 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 89

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Definition of a Business – Amendments to IFRS 3; IFRS to a Business – Amendments Definition of 7; and IFRS 39 IAS 9, IFRS to – Amendments Reform Benchmark Rate Interest Reporting; Financial for Framework Conceptual Revised and 8; 1 and IAS IAS to – amendments Material Definition of Treatments. Income Tax Uncertainty over IFRIC 23 (d) Basis of consolidation(d) (its the Company by entities controlled the Company, of the financial statements incorporate financial statements The consolidated each year. 31 March made up to Trust Benefit Plc Employee Group subsidiaries)and the Motorpoint statements. financial the Company 4 to subsidiariesA list of in note is disclosed included in the Balance are and liabilities thus the assets the EBT of has control, on the basis that the Company is consolidated The EBT the purpose has been solely set up for The EBT equity. deduction from as a presented are in the Company the EBT held by Sheet and shares schemes 31 and has no ability to detailed in Note share-based under the various satisfy to awards employees Group to issuing shares of liabilities, the Group. of access or settle assets, or use to, or has rights to, is exposed the Group when an entity controls The Group has control. which the Group all entities over Subsidiaries are Subsidiaries the entity. over power its through returns those affect and has the ability to with the entity involvement its from returns variable ceases. control that the date from deconsolidated are They the Group. to is transferred on which control the date from fully consolidated are on consolidation. eliminated companies are Group and balances between transactions Intercompany Segmental reporting(e) on be presented to segments which requires Segments’, 8 ‘Operating with IFRS in accordance segmental reporting has prepared The Group is financial information discrete the business of is a component where segment An operating reporting. the same basis as the management resources decisions about make to decision maker chief operating the Group’s by reviewed regularly are results and the operating available assess performance. and to its the segment to be allocated to reportable The Group’s with similar characteristics. those combine to segments reporting into aggregated are segments Operating be the to is considered decision maker chief operating The Group’s Kingdom operations. be the United to is considered segment operating Directors. of Board These operations. these individual branch for is prepared financial information and separate network a branch through operates The Group the of that the nature it is considered purposes. However impairment for units’ ‘cash-generating separate considered are branches all based within the UK. are as they economic characteristics, similar long-term all have is similar and they and products operations segment. As a consequence it has one reportable 8 and thus considers IFRS of criteria has applied the aggregation the Group Accordingly is required. no additional segmental information recognition (f) Revenue is Revenue goods and services the sale of of customers. to added tax, in respect value net of chargeable, amounts represents Revenue the for criteria and the specified recognition measured, when it can be reliably receivable, the consideration of value at the fair measured on the identified separately prices and are based on periodically reviewed price is determined sales type has been met. transaction The consideration. no estimates variable of are There invoice. customer’s sold individually. are as if each products those of value services is at fair related and motor vehicles motor price for The transaction (i) Sales of motor vehicles or delivered by, has been collected when the vehicle has passed; that is, when the control is recognised vehicles motor sale of from Revenue Sales accessories, of such the vehicle. purchases when the customer price is due immediately the transaction of Payment the customer. to, in the same way. recognised are as mats, services(ii) Sales and commissions of motor related as the as well asset protection and vehicle guarantees extended services sales include commissions on finance introductions, related Motor has the protection has passed; that is, when the control recognised are products Sales protection paint of products. protection paint sale of the customer. is supplied to been applied and the product the guarantee deferring by for accounted claims are future for responsible is contractually the Group where guarantees extended Vehicle the of life the remaining line basis over the income on a straight and then releasing selling costs, along with direct income received income as comprehensive of the statement to expensed income are guarantee • • • • (c) New standards, amendments standards, and interpretations New (c) 2021 March 31 for not mandatory issued but are been that have or amendments interpretations standards, has not early-adopted The Group periods. reporting not had a applied and have been have year, financial the current for effective and interpretations amended standards The following future periods and on foreseeable reporting or future in the current financial statements consolidated impact on the Group’s significant transactions. • NOTES TO THE FINANCIAL STATEMENTS CONTINUED

2. Summary of significant accounting policies continued (f) Revenue recognition continued 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 finance commission income, primarily arising when the customer uses third-party finance to purchase the vehicle, the Group recognises such income on an ‘as earned’ basis. The assessment is based on whether the Group controls the specific goods and services before transferring them to the end customer, rather than whether it has exposure to significant risks and rewards associated with the sale of goods or services.

Products and services Nature, timing of satisfaction of performance obligations and significant 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. Vehicles do not leave the premises until they are paid for in full and therefore the revenue and the profit 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. Sales of motor related services and The Group receives commissions when it arranges finance, insurance packages, extended commissions warranty and paint protection for its customers, acting as agent on behalf of a limited number of finance, insurance and other companies. For finance and insurance packages, commission is earned and recognised as revenue when the customer draws down the finance or commences the insurance policy from the supplier which coincides with the delivery of the product or service. Commissions receivable are paid typically in the month after the finance 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 offered 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 (eg 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 financial 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) Property, plant & 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 fixed assets so as to write off 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 fittings 20% straight line Office equipment 20% – 33.3% straight line

Motorpoint Group plc 90 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 91

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 it is held within a business model whose objective is to hold assets to collect contractual cash flows; and cash flows; collect contractual to hold assets is to it is held within a business objective model whose on the principal amount and interest principal of solely payments that are cash flows to rise on specified dates give terms contractual its outstanding. • method. The amortised is cost interest at amortised using the effective cost measured subsequently at amortised assets are cost Financial Any or loss. in profit recognised are gains and losses and impairments exchange foreign income, losses. Interest impairment by reduced or loss. in profit is recognised on de-recognition gain or loss a probability- are at amortised cost. ECL measured on financial assets (‘ECL’) Losses Credit Expected for allowances loss recognises The Group the cash between (ie the difference all cash shortfalls of value as the present measured losses are losses. Credit credit estimate of weighted balances receivable All trade receive). to expects that the Group and the cash flows with the contract in accordance the Group due to flows assessed individually. are at amortised are cost measured financial assets for allowances the financial asset. of Loss rate interest at the effective discounted are ECL carrying the assets. of amount the gross from deducted is A financial asset credit-impaired. assesses carried at amortised whether financial assets are cost the Group date, each reporting At the financial asset have of cash flows a detrimental the estimated future impact on that have events when one or more ‘credit-impaired’ prospect is no realistic that there partially the extent or in full) to (either off carrying a financial asset is written of amount The gross occurred. income that could of or sources assets does not have that the debtor determines the case when the Group This is generally recovery. of the write-off. subject to the amounts repay to cash flows sufficient generate activities. its arising from risks hedge currency to instruments holds hedging decisions the Group time based on purchasing time to From comprehensive of in the statement is recognised on remeasurement gain or loss Any value. at fair recognised are Hedging instruments depends on the hedge accounting which qualify hedging instruments for gains or losses of arising from the treatment However, income. the contract terminate to or payable receivable amount is the estimated hedging instruments of value The fair hedge arrangement. type of a net hedge of an effective of in respect A gain or loss at the balance sheet date. prices prevailing the market to reference by determined of in the statement portion the hedge is recognised of ineffective Any in equity. directly is recognised operation in an overseas investment in administrative or loss in profit is recognised and no gain or loss has no hedge arrangements currently The Group income. comprehensive expenses. liabilitiesFinancial through value at amortised or at fair cost as either other financial liabilities measured classified on initial recognition liabilities are Financial or loss. profit Assets in the course of construction are recorded separately within property, plant and equipment and are transferred to the appropriate appropriate the to transferred and are and equipment plant within property, separately recorded construction are of in the course Assets use. into bought are they the date from and depreciated classification when complete The carrying valueat each sheet date. balance if appropriate, and adjusted reviewed, are and their useful lives the assets of values The residual are Assets not be recoverable. suggest may that the carrying or changes value in circumstances if events impairment for is reviewed assets of of the statement to is charged impairment and any than their carrying value, if lower amount their recoverable to down written income. comprehensive of in the statement recognised with the carrying and are amount comparing the proceeds by determined Gains and losses are on disposals income’. income within ‘other comprehensive (j) instruments Financial becomes party to sheet when the Group balance and financial liabilities financial assets in the Group’s recognise to entity an 9 requires IFRS the instrument. of provisions the contractual liabilities financial assets, as financial equity or parts, recognition on initial or their component classifies financial instruments, The Group into. entered arrangements the substance the contractual of to according instruments liabilities. after its Equity deducting all of the Group of in the assets interest that evidences a residual contract is any An equity instrument issue costs. direct net of received, as the proceeds recorded are the Group by issued instruments assetsFinancial becomes a when the Group recognised initially are All other financial assets originated. when they initially recognised are receivables Trade instrument. the of provisions party the contractual to profit through value not at fair a financial asset in the case of plus, value fair its a financial asset at measures the Group initial recognition, At financial assets of costs the financial asset. Transaction the acquisition of to attributable directly that are costs transaction (‘FVPL'), or loss at the initially measured is financing component without a significant receivable A trade or loss. in profit expensed carried at FVPL are price. transaction income or through other comprehensive through (either value at fair subsequently A financial asset is classified either as being measured managing the financial assets business model for at amortised cost.classification depends on the Group’s The or measured or loss), profit the cash flows. of terms and the contractual their initial to subsequent not reclassified are assets at amortisedcost. Financial classified as measured are the Group of All financial assets managing financial assets. changes business its model for unless the Group recognition in reported value conditions and is not designated as at fair the following at amortised both of if it meets cost A financial asset is measured or loss: profit • NOTES TO THE FINANCIAL STATEMENTS CONTINUED

2. Summary of significant accounting policies continued (j) Financial instruments continued Offsetting of financial assets and liabilities Financial assets and liabilities are offset and the net amount reported in the balance sheet when there is a legally enforceable right to offset 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. (k) Leases In the prior year the Group applied IFRS 16 for the first time, 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 2019 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 specific adjustments for risk and security. Lease payments included in the measurement of the lease liability comprise: • fixed lease payments (including in-substance fixed 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 reflects the exercise of an option to terminate the lease. Break and extension options are included in leases to provide operational flexibility should the economic outlook for an asset be different 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 reflect interest on the lease liability (using the effective interest method) and by reducing the carrying amount to reflect 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 • 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 floating interest rate, in which case a revised discount rate is used); or • the lease contract is modified and the lease modification 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 profit or loss.

Motorpoint Group plc 92 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 93

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Right-of-use asset – initial recognition Right-of-use the made at or before lease payments lease liability, the corresponding of asset comprises the initial measurement The right-of-use less at cost measured subsequently are They costs. initial direct and any costs, dilapidation or removal any date, commencement losses. and impairment depreciation accumulated the or restore it is located on which the branch a leased asset, restore and remove dismantle to costs for has an obligation the Group Where 37. IAS under and measured is recognised a provision the lease, of and conditions the terms by the condition required underlying asset to asset. right-of-use included in the related these are of costs value The present Sheet. Balance line in the as a separate asset is presented The right-of-use asset – subsequent measurement Right-of-use the underlying asset. of useful life and the lease of the shorter term over depreciated are assets Right-of-use Impairment as described loss impairment identified any for and accounts asset is impaired whether a right-of-use determine 36 to applies IAS The Group in the measurement not included are or rate that do not depend on an index rents Variable policy. assets’ – non-financial in the ‘Impairment or in the period in which the event as an expense recognised are payments asset. The related the leaseof liability and the right-of-use occurs. payments those condition that triggers (l) Inventory vehicles. moving slow for after due regard value, and net realisable cost of at the lower is valued Inventory provision When calculating an inventory completion and selling costs. of costs is based on selling price less anticipated value Net realisable determined saleability, expected as applying assumptions around as well the inventory and condition of the nature considers management patterns. trading on historic method. using the specific identification is calculated cost Inventory receivables (m) Trade sales of the financed element to of finance companies in respect outstanding from the principal amounts represent receivables Trade impairment. for provision any net of recognised are receivables Trade products. and related vehicle motor for customers do not contain and other receivables Trade approach. loss credit on an expected measured certain of are The carrying financial assets value which 9, IFRS by permitted approach using the simplified measured losses are credit expected and therefore financing element a significant the receivables. of the initial recognition from recognised be losses to lifetime expected requires (n) Cash and cash equivalents are bank overdrafts applicable, Where include cash in hand and at bank,Cash held at call with banks. and deposits and cash equivalents liabilities. in current within borrowings shown tax and deferred Current (o) to except income, comprehensive of in the statement is recognised tax. Tax and deferred the period comprises current for The tax expense in equity. income or directly in other comprehensive recognised items to that it relates the extent at the balance sheet date. enacted or substantively enacted tax on the basis of laws is calculated tax charge The current certain of for items the treatment arising between differences all temporary of in respect without discounting, tax is recognised, Deferred at the rates, tax is measured Deferred the balance sheet date. by arisen but not reversed purposes,taxation which have and accounting the periods when apply in to expected that are at the balance sheet date, enacted or substantively enacted and law based on the tax rates reverse. to expected are the timing differences the against which will be available taxable profits that future that it is probable the extent only to recognised tax are assets Deferred can be utilised. differences temporary tax liabilities tax against current assets current offset to right is a legally enforceable when there offset tax and liabilities assets are Deferred the same taxation authority on either the same taxable entity by levied income taxes to tax and liabilities assets relate and when the deferred the balances on a net basis. settle to is an intention taxable entities and there or different payables Trade (p) Accounts suppliers. business of from course in the ordinary been acquired goods or services that have for pay obligations to are payables Trade liabilities. as non-current presented or less. are If not, they is due within one year liabilities if payment classified as current are payable method, unless interest at amortise NOTES TO THE FINANCIAL STATEMENTS CONTINUED

2. Summary of significant accounting policies continued (q) Stocking finance facilities Stocking finance 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 fixed maturity not greater than 150 days and as a result form part of the normal business operating cycle (see note 21 for more details). They are recognised initially at fair value and subsequently measured at amortised cost using the effective interest method, unless the effect is immaterial. (r) Share capital Ordinary Shares are classified as equity. Costs incurred in issuing equity are deducted from the equity instrument. (s) 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 outflow 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 outflow 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 outflow 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 reflects current market assessments of the time value of money and the risks specific to the liability. The increase in the provision due to the passage of time is recognised as interest expense. (t) Borrowings Borrowings are recognised initially at fair value, net of transaction costs incurred. Borrowings are subsequently carried at amortised cost using the effective interest rate method. The effective interest rate method is a method of calculating the amortised cost and allocating the interest cost over the relevant period. The effective interest rate is the rate that exactly discounts estimated future cash payments through the expected life of the financial instrument. (u) Employee benefits (i) Pensions The Group operates a defined 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 benefits The Group recognises an expense for other short-term employee benefits, 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 effect 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 31. 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 effect 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 reflect 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. (v) 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. (w) EPS The Group presents basic and diluted EPS for its Ordinary Shares. Basic EPS is calculated by dividing the profit 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. (x) 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 refinancing and restructuring costs.

Motorpoint Group plc 94 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 95

£m 1.5 0.1 0.1 (3.2) Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Underlying profit measures profit Underlying Critical estimates accounting and judgements operating profit before exceptional items (adjusted operating profit); and profit); operating (adjusted items exceptional before profit operating tax). before profit (adjusted items exceptional tax before before profit Right-of-use asset Right-of-use Depreciation liability Lease cost Finance retail the Group’s of closure the Given value. and net realisable cost of at the lower stated are 17): (note Inventories provisions Inventory the uncertainty is some continued around there pandemic, the Coronavirus due to in sales volumes during FY21 and reduction branches falls value realisable net feels management is included where a provision years, end. As in previous at the year inventory of sale value future net sales and potential estimates and forecast management on historical based by is determined provision of cost. The level below value. realisable the primary the sensitivity of FY21, seen throughout with similar trends been strong have in April 2021 since reopening sales volumes Given vehicles of If the proportion inventory. end sell the year to be required pricing changes would estimate is whether excessive provision just £0.1m. by increase would model the provision current to compared 5% by making losses increased The Group indicators. impairment of the existence an annual assessment as to performs the Group 36, IAS assessments: Under Impairment pandemic the Coronavirus of financial impact on Motorpoint that the future believe during FY21 and management profitable has remained which could or social distancing measures further lockdowns is an ongoing risk surrounding as there be short However, to term. is likely The impairment trigger. an impairment meet the definition of to the pandemic is still considered estate, retail impact the Group’s directly The has been made. charge so no impairment cashflows, future of a sufficiency unit showing cash-generating in every results review is £1.4m unit cash-generating on any minimum headroom unit. as a cash-generating Branch using each Retail estate, the Group’s of review an impairment completed has therefore Management cashflow Future in use. and value disposal, less of costs value fair the higher of are units cash-generating for amounts Recoverable including in the newest improvement, and include modest ongoing performance forecasts internal based on the Group’s are projections rate discount estimates Management the risk-adjusted and conservative. be reasonable to these cashflows considers The Group branches. money. of assessment the time value of market the current that reflect rates using pre-tax has been charge so no impairment cashflows, future of a sufficiency unit showing cash-generating in every results review The impairment based on possible scenarios possible reasonably using various tests on the impairment analysis has carried out sensitivity The Group made. higher than 3% rate applied. Applying a discount rate the estimated discount to In particular the model is sensitive movements. market be realised. to impairment any for in the requirement best estimate still does not result management’s Significant judgements asset and lease liability. the right-of-use both of in the measurement component 15): The lease is a significant (note term term Lease 16 IFRS the underlying the lease or purchase certainty extend that an option to is reasonable there whether in determining is exercised Judgement when ascertaining be included in the lease the periods to the lease will not be exercised, terminate or an option to asset will be exercised, option, or not an extension exercise to an economical incentive that create and circumstances the lease all facts In determining term, term. certain to whether it is reasonably reassesses The Group at the lease date. commencement considered option, are a termination exercise to change in circumstances. or significant event is a significant option, if there a termination option, or not exercise an extension exercise following closure a period of underwent The Group on a going concern basis. been prepared Going have concern status: The accounts placed on short liquidity. term were and additional stresses pandemic, the Coronavirus of as a result the UK Government by guidance given • the most considered and are the Group of the earning understand trends to Directors of the Board applied by are measures The adjusted no exceptional are there prior year and current In the the Group. of performance assess the true operating which to by meaningful measures when considering earlier years. valid remain measures these underlying profit however noted; items 4. 3. the overall measure Directors of The Board Directors. of be the Board to is considered decision maker operating chief The Group’s measures: non-GAAP the following to reference by the Group of performance • estimates application of and assumptions in the judgements, make to management requires the financial statements of The preparation of about these areas information Further liabilities, and expense. income assets, of amounts reported policiesaccounting affect that and other experience based on historical and are evaluated continually are and judgements Estimates is contained below. judgement under the circumstances. be reasonable to believed that are events future of including expectations factors estimatesAccounting an incremental determined, implicit in a lease be readily cannot rate the interest 15): Where (note rate borrowing Incremental 16 IFRS the lease of liability at the lease value the present measure to lease payments future discount is estimated to rate borrowing the funds necessary to borrow party to a third pay to have estimates it would is based on what the Group a rate Such date. commencement an increase The impact of environment. security and economic asset, with similar terms, the right-of-use to obtain a similar value an asset of below: lease is presented liability and finance cost asset, depreciation, the FY21 right-of-use applied to rate on the discount 0.5% of NOTES TO THE FINANCIAL STATEMENTS CONTINUED

4. Critical accounting estimates and judgements continued Significant judgements continued A range of scenario modelling has been performed as part of the going concern status assessment, considering stressed levels of volume and margin over the going concern period. Further details are provided in the going concern section of this note.

5. Revenue Revenue has been analysed between the sale of goods and the sale of services below.

2021 2020 £m £m Revenue analysis Revenue from sale of motor vehicles 687.5 965.5 Revenue from motor related services and commissions 29.0 45.8 Revenue recognised that was included in deferred income at the beginning of the year – Sale of motor vehicles 1.7 3.3 Revenue recognised that was included in deferred income at the beginning of the year – Motor related services and commissions 3.0 2.0 Revenue recognised that was included in the contract liability balance at the beginning of the year – Extended guarantee income 0.2 1.4 Total revenue 721.4 1,018.0

The Group recognises the following contract liabilities:

2021 2020 £m £m Contract liabilities Unearned proportion of extended guarantee income1 – 0.2 – 0.2

1 Contract liabilities are vehicle extended guarantees where the Group is contractually responsible for future claims and 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 year but continues to release income in relation to legacy sales.

The Group recognises the following accrued income balances:

2021 2020 £m £m Accrued income Commissions1 0.4 0.1 0.4 0.1

1 Accrued income relates to commissions earned from finance companies received the following month.

The Group recognises the following deferred income balances within accruals and deferred income:

2021 2020 £m £m Deferred income Vehicles invoiced not collected 3.3 1.7 Commissions received not earned 3.0 3.0 Total deferred income 6.3 4.7

Motorpoint Group plc 96 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 97

£m £m £m No. 22 19 0.1 0.2 5.0 0.6 2.6 (0.1) 2020 2020 2020 2020 2020 (0.2) 166 254 762 508 125 £’000 28.8 40.2 28.8 16.4 25.7 995.7 939.1 928.0 Motorpoint Group plc Group Motorpoint – £m £m £m 15 No. 0.1 0.2 0.2 5.7 0.6 2.7 0.2 2021 2021 2021 2021 2021 189 252 769 517 174 £’000 25.6 36.0 25.6 13.9 22.1 708.8 658.9 654.9 Annual Report and Accounts 2021 Auditor’s remuneration: Auditor’s Employees and Directors Employees Operating profit Operating Audit-related assurance services comprise fees payable to the Group’s auditor for carrying out a review of the Group’s interim results in accordance with International Standard on Standard with International in accordance results interim the Group’s of carrying out a review for auditor the Group’s to payable services comprise fees assurance Audit-related 2410. (UK and Ireland) Engagements Review Loss on disposal of property, plant and equipment on disposal of property, Loss Receipts associated with the Job Retention Scheme of £3.9m (FY20: £0.3m) have been recognised in employee benefit expenses. All benefit expenses. in employee been recognised have £0.3m) (FY20: £3.9m of Scheme with the Job Retention associated Receipts staff on furlough. been paid in full to Scheme have the Job Retention from receipts as was the Group by employed ‑party contractors) third but excluding (including Directors employees number of monthly The average follows: Receipts associated with the Job Retention Scheme of £3.9m (FY20: £0.3m) have been recognised in employee benefit expenses. All benefit expenses. in employee been recognised have £0.3m) (FY20: £3.9m Scheme of with the Job Retention associated Receipts staff furlough. on been paid in full to Scheme have the Job Retention from receipts 7. Expense on short term and low value leases value Expense on short term and low based compensation charge (note 31) ‑based compensation charge Share Total expenses Total Total Depreciation of property, plant and equipment (note 14) and right-of-use assets (note 15) and right-of-use (note 14) plant and equipment of property, Depreciation Other pension costs Administrative expenses Administrative related assurance services assurance 1 ‑related Audit Employee benefit expense (note 8) benefit expense Employee Administration and support Administration Social security costs Operating expenses: Operating Selling and distribution expenses Fees payable for the audit of the Company’s subsidiaries the audit of the Company’s for payable Fees Movement in provision against inventory in provision Movement Average number of people employed: Average Sales and operations Employee benefit expenses: Employee and salaries Wages Cost of sales 1 8. The aggregate employee benefit expenses were as follows: were expenses benefit employee The aggregate Auditor’s remuneration: Auditor’s financial statements and consolidated Company the audit of the parent for payable Fees Total expenses comprise: expenses Total Inventory recognised as expense recognised Inventory Operating profit include the effect of charging/(crediting): the effect include profit Operating 6. as: Analysed NOTES TO THE FINANCIAL STATEMENTS CONTINUED

9. Directors’ and key management remuneration Key management has been identified as the Directors of Motorpoint Group Plc.

2021 2020 £m £m Remuneration 0.6 0.9 Employer contributions paid to money purchase schemes – 0.1 Benefits in kind – – 0.6 1.0

During the year the number of key management who were receiving benefits was 2 (FY20: 2). The table above includes both Executive and Non-executive Directors and excludes payments made to former Directors for loss of office. James Gilmour ceased to be a Board Director on 24 August 2020 when he left the Company and received a payment of £0.1m for the period when he was placed on garden leave. Further information on Directors’ remuneration for the Directors of Motorpoint Group Plc is included in the Remuneration Committee Report on page 66. In respect of the highest paid Director refer to page 66 of the Annual Report on Remuneration.

10. Finance expense 2021 2020 £m £m Interest on bank borrowings 0.2 0.2 Interest on stocking finance facilities 1.1 1.7 Other interest payable 1.6 1.6 Total finance expense 2.9 3.5

11. Income tax expense The tax charge in the statement of comprehensive income represents:

2021 2020 £m £m Current tax: UK corporation tax 2.0 3.5 Adjustment in respect of prior years – (0.1) Total current tax 2.0 3.4 Deferred tax: Origination and reversal of temporary differences 0.1 0.4 Impact of UK corporation tax rate change – (0.2) Total deferred tax 0.1 0.2 Total tax charge in the statement of comprehensive income 2.1 3.6

Reconciliation of the total tax charge The tax charge in the statement of comprehensive income in the year differs from (FY20: is consistent with) the charge which would result from the standard rate of corporation tax in the UK of 19% (FY20: 19%):

2021 2020 £m £m Profit before taxation 9.7 18.8 Profit before taxation at the standard rate of corporation tax of 19% (FY20: 19%) 1.8 3.6

Tax effect of: – Fixed asset differences 0.3 0.2 – Expenses not deductible for tax purposes – 0.1 – Adjustments to tax charge in respect of prior periods – (0.1) – Adjustment to opening deferred tax – (0.2) Tax charge in the statement of comprehensive income 2.1 3.6

A tax receivable balance of £1.7m (2020: £0.9m) is included within current assets as a result of the payments on account to HMRC exceeding the tax charge for the year.

Motorpoint Group plc 98 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 99

£m 56 7.0 2.3 4.7 2020 2020 2020 16.4 16.4 15.2 92,577 92,577 92,521 92,521 Motorpoint Group plc Group Motorpoint – – – £m 75 8.4 8.4 7.6 2021 2021 2021 90,265 90,265 90,190 90,190 Annual Report and Accounts 2021 Earnings per share Dividends The difference between the basic and diluted weighted average number of shares represents the dilutive effect of the FY19, FY20, FY21 SAYE FY21 SAYE FY20, the FY19, of effect the dilutive represents shares number of average weighted the basic and diluted between The difference below. in the reconciliation schemes. This is shown PSP and FY18 under the FY17 options exercised but not yet schemes and the vested not been met so the options are which have criteria performance have 2021 for and RSA and 2020 2019 schemes for the PSP for The shares to calculation in relation not been included in the dilutive have additional options which 1,214,031 is a maximum of There dilutive. not yet 31. is included in note information these schemes. Further Diluted EPS (pence) Diluted EPS The Board has not proposed a final dividend (FY20: £Nil) for the year ended 31 March 2021. 2021. ended 31 March the year £Nil) for a final dividend (FY20: has not proposed The Board 13. paid: dividends were following the During the year Diluted weighted average number of Shares in Issue (‘000) number of Shares average Diluted weighted Total Total Weighted average number of Ordinary Shares for diluted earnings per share (‘000) diluted earnings per share for Shares number of Ordinary average Weighted Basic EPS (pence) Basic EPS Adjustment for share options (‘000) share for Adjustment 2020 March ended 31 the year Interim dividend for Weighted average number of Ordinary Shares in Issue (‘000) Shares number of Ordinary average Weighted Final dividend for the year ended 31 March 2019 March ended 31 the year dividend for Final Weighted average number of Ordinary Shares in Issue (‘000) Shares number of Ordinary average Weighted Profit Attributable to Ordinary Shareholders (£m) Shareholders to Ordinary Attributable Profit Factors affecting current and future tax charges and future current affecting Factors than (rather at 19% remain would tax rate the corporation 1 April 2020 announced that from the Government 2020, In the Spring UK Budget been tax balances have and so deferred 2020 March on 17 enacted substantively was law enacted). This new as previously 17%, to reducing the of as a result supporteconomic recovery to included measures 2021 on 3 March announcement 2021 The UK Budget 19%. at measured 1 April from be effective which is due to 25%, to tax rate main corporation the UK’s to These included an increase pandemic. Coronavirus 2023. at the current enacted change had been substantively If this rate tax charge. future on the Group’s effect a consequential This will have £0.4m. by increased have tax asset would the deferred balance sheet date 12. number of average the weighted by shareholders equity the earnings dividing to attributable by calculated are EPS diluted and Basic the year. during Shares Ordinary NOTES TO THE FINANCIAL STATEMENTS CONTINUED

14. Property, plant and equipment Short term Freehold leasehold Plant and Fixtures and Office Work in Land property improvements machinery fittings equipment progress Total £m £m £m £m £m £m £m £m Cost At 1 April 2019 1.7 – 6.4 1.2 1.1 2.7 2.5 15.6 Additions 4.5 3.6 0.8 0.3 0.2 0.4 2.5 12.3 Transfers – 2.3 – – – 0.1 (2.4) – Disposals – – – – – – (0.1) (0.1) At 31 March 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 (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

Accumulated depreciation At 1 April 2019 – – 3.4 0.9 0.8 2.2 – 7.3 Provided during the year – 0.1 0.9 0.1 0.3 0.2 – 1.6 Disposals – – – – – – – – At 31 March 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 – (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

Net book value 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 At 31 March 2019 1.7 – 3.0 0.3 0.3 0.5 2.5 8.3 The depreciation expense of £1.9m (FY20: £1.6m) has been recorded in operating expenses.

15. Leases The Group only acts as a lessee. (a) Amounts recognised in the statement of financial position The balance sheet shows the following amounts relating to leases:

Land and buildings £m Right-of-use assets Balance at 1 April 2019 42.6 Additions to right-of-use assets 2.4 Depreciation charge (3.4) Balance at 31 March 2020 41.6

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

Motorpoint Group plc 100 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 101

£m £m £m 1.6 4.7 3.4 2.2 1.6 2.3 7.5 1.6 2.4 2020 2020 (4.6) (5.2) 45.4 58.4 35.4 18.3 46.2 45.4 43.1 45.4 49.3 46.9 (13.0) buildings Land and Motorpoint Group plc Group Motorpoint £m £m 1.6 5.4 3.8 2021 2021 49.3 61.1 35.1 20.6 (11.8) Annual Report and Accounts 2021 (b) Amounts recognised in the statement of comprehensive income Amounts comprehensive of in the statement (b) recognised leases: to relating amounts following the income shows comprehensive of The statement Lease liability Lease Interest charges Interest Total minimum lease payments Total The total cash outflow for leases held as right-of-use assets in FY21 was £5.2m (FY20: £4.6m). (FY20: £5.2m in FY21 was assets leases held as right-of-use for cash outflow The total £0.2m). (FY20: leases £0.2m value is also included of on short and low term An expense these accounted for leasing are activities and how The Group’s (c) have but may years, 20 to three periods of fixed typically made for are contracts Rental branches. leases offices and retail various The Group options. extension do not The lease and conditions. agreements terms different of and contain on an individual basis a range negotiated are terms Lease not be used as may assets Leased the lessor. held by in the leased that are assets other than the security interests covenants any impose purposes. borrowing security for certainty that the is reasonable unless there not exercised, has assumed that these are the Group leases break, contain options to Where these options, extension any for Similarly, point. the break the liability is to for the assumed duration and therefore lease will be extended, certainty. reasonable is be utilised unless not been assumed to there have the Group. use by for at which the leased liability at the date asset is available asset and a corresponding as a right-of-use recognised are Leases After five years After five In the second to fifth years inclusive In the second to fifth years expense Finance expense Interest Depreciation charge of right-of-use assets of right-of-use charge Depreciation Buildings Within one year Within Lease liabilitiesLease Balance at 1 April 2019 element) of lease liabilities (including interest Repayment to lease liabilities related expense Interest 2020 March 31 Balance at Non-current of lease element) liabilities (including interest Repayment to lease liabilities related expense Interest 2021 March 31 Balance at Non-current Additions to lease liabilities Additions Current Balance at 1 April 2020 to lease liabilitiesAdditions Current in the table below. is reported 2021 as at 31 March cash flows lease of gross analysis liabilitiesA maturity based on undiscounted NOTES TO THE FINANCIAL STATEMENTS CONTINUED

15. Leases continued (c) The Group’s leasing activities and how these are accounted for continued 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 financing received by the individual lessee as a starting point, adjusted to reflect changes in financing conditions since third party financing 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 financing; and • makes adjustments specific to the lease where relevant. Lease payments are allocated between principal and finance cost. The finance cost is charged to profit 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.

16. Deferred tax assets The movement in deferred taxation assets and liabilities during the year, without taking into consideration the offsetting of balances within the same tax jurisdiction, is as follows:

Accelerated Other timing capital allowances differences Total Other temporary differences £m £m £m At 1 April 2019 1.4 0.1 1.5 Charged to the statement of comprehensive income (0.2) – (0.2) At 31 March 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

17. Inventories 2021 2020 £m £m Finished goods: New and used vehicles for resale 128.4 111.8

The replacement cost of inventories is not considered to be materially different from the above values. Provisions against inventory total £1.4m (FY20: £1.2m). Inventory is pledged as security for the stocking finance facilities where funding has been drawn down on that inventory.

18. Trade and other receivables 2021 2020 Due within one year £m £m Trade receivables1 2.1 3.0 Other receivables 0.5 1.0 VAT receivables 3.7 – Prepayments 1.0 0.3 Accrued income2 0.4 0.1 7.7 4.4

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 financial institutions on the financed element of vehicle sales to customers. The maximum exposure to credit risk is the carrying amount. The Group has no provisions against trade receivables (FY20: £Nil). 2 Accrued income relates to commissions earned from finance companies.

None of the Group’s trade receivables or other receivables were past due or impaired (FY20: £Nil). Trade and other receivables are valued at their book value which is equivalent to fair value and all are in sterling.

Motorpoint Group plc 102 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 103

£m £m 8.8 0.8 1.4 0.2 Total £m (7.5) (2.2) 2020 2020 10.6 10.8 86.1 12.7 (43.3) (44.6) (10.0) (32.4) 111.6 111.8 Motorpoint Group plc Group Motorpoint – – – – £m £m £m 6.0 0.7 6.0 Cash (4.8) (3.0) 2021 2021 10.8 13.8 19.4 89.2 16.4 125.7 125.7 Annual Report and Accounts 2021 £m (7.5) (2.2) (7.0) 13.6 (49.3) (55.4) (46.2) Sub-total £m 3.6 3.0 (7.5) (2.2) Leases (49.3) (45.4) (46.2) – – – £m 0.0 10.0 (10.0) (10.0) Borrowings 2 1 3 Trade and other payables: amounts due within one year and other payables: Trade Cash cash and equivalents Stocking finance facilities are provided from Black Horse Limited and Lombard North Central PLC. At 31 March 2021 the Group had £106m (FY20: £101m) of stocking finance facilities £101m) stocking had £106m (FY20: of the Group 2021 31 March At PLC. North Central and Lombard Limited Black Horse from provided are finance facilities Stocking drawn. was £86.1m) (FY20: which £89.2m of available is drawn finance facility which the stocking against the vehicle secured are and all borrowings 2019 in May renegotiated was Limited with Black Horse finance facility The stocking between of date or a latest vehicle on the earlier the respective the sale of of The finance is repayable £80.0m. to £75.0m by increased was this facility against. During the year down Since 2021. March on the scheme as at 18 already vehicles for 30 days by extended was term amount. The repayment the facility of drawdown of date from days 90 and 150 Rate. House Base Finance over 1% of at the rate interest bears the facility renegotiation is finance facility which the stocking against the vehicle secured are and all borrowings 2019 in March negotiated was PLC North Central with Lombard finance facility The stocking the facility of drawdown of date from days 90 and 120 between of or a latest date vehicle on the earlier the respective the sale of of against. The finance is repayable down drawn over 1.35% of at the rate interest bears the facility Since renegotiation 2021. on the scheme as at 4 February already vehicles for days 60 by extended was term amount. The repayment Rate. House Base Finance as a finance cost. has been recognised £1.7m) (FY20: £1.1m of in the year expense Interest commissions of £3.0m) (FY20: and £3.0m date at the reporting not collected invoiced vehicles to in relation £1.7m) (FY20: income is £3.3m Included within accruals and deferred in advance. received income received, the guarantee deferring by for accounted claims and are future for responsible is contractually the Group where guarantees extended vehicle liabilities are Contract guarantee servicing the extended to in relation Costs the guarantee. of life the remaining line basis over the income on a straight and then releasing selling costs, along with direct release or prior period but continues to these of policies in the current has not sold any The Group income as incurred. comprehensive of the statement to expensed income are sales. legacy to income in relation bearing. all non-interest are and other payables trade payable, finance facilities Other than the stocking in sterling. and all are their book value to liabilities approximates current of value their shortDue to maturities, the fair 21. Net debt as at 31 March 2021 March 31 debt as at Net New leasesNew Cash flows Net debt as at 31 March 2020 March Net debt as at 31 New leasesNew Accruals and deferred income and deferred Accruals Cash flows – PAYE/NI payable – PAYE/NI – Stocking finance facilities Borrowings 20. an as available £6.0m split between Santander UK PLC, by provided loan facility an unsecured consist of borrowings available The Group’s with agreed was facility overdraft £15.0m month 12 A further temporary facility. credit revolving as a available and £14.0m overdraft This additional during the pandemic. been required help support have should it to short cash impacts, term 2020 in May Santander UK PLC down. drawn was £10.0m) £Nil (FY20: date As at the reporting 2024. in May expires facility £20.0m not used. The existing was facility During in effect. interest of as the base rate as well ratios borrowing on the Group’s is dependent the facility utilising for The finance charge £0.2m) (FY20: £0.2m of the year for charged per annum. The interest 1.4%) (FY20: at 1.4% charged was interest 2021 ended 31 March the year as a finance cost. has been expensed debt reconciliation Net Other taxes and social security Other taxes payable – VAT liabilitiesContract 2 3 1 Trade payables payables Trade creditors – Trade Net debt as at 1 April 2019 Cash at bank and in hand 19. NOTES TO THE FINANCIAL STATEMENTS CONTINUED

22. Provisions 2021 2021 2021 2020 2020 2020 £m £m £m £m £m £m Current Non-current Total Current Non-current Total Make good provision1 – 1.9 1.9 – 1.9 1.9 Onerous lease2 0.1 0.1 0.2 0.2 0.2 0.4 0.1 2.0 2.1 0.2 2.1 2.3

Movements in each class of provision during the financial year are set out below:

2021 2020 Make good 2021 2021 Make good 2020 2020 provision1 Onerous lease2 Total provision1 Onerous lease2 Total Carrying amount at start of year 1.9 0.4 2.3 1.6 0.5 2.1 Charged/(credited) to statement of comprehensive income – additional provisions recognised – – – 0.2 – 0.2 – unwinding of discount – – – 0.1 – 0.1 Amounts used during the year – (0.2) (0.2) – (0.1) (0.1) Carrying amount at end of year 1.9 0.2 2.1 1.9 0.4 2.3

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 outflow 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 11 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 5 years.

23. Financial instruments and risk management The principal financial liabilities comprise inventory finance facilities, borrowings, and trade and other payables. The main purpose of these financial liabilities is to provide working capital funding for the Group. The main risks arising from financial liabilities are discussed further below. The principal financial 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 financial 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 finance provided by a selected panel of financial institutions. The majority of the Group’s sales are thus for cash or the remittances of funds from financial 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 significant. The maximum exposure is the carrying value amount as disclosed in this note. There is no significant concentration of credit risk within the Group. As a consequence, the Directors are satisfied that the Group’s exposure to credit risk is acceptable. With respect to credit risk arising from other financial 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 defined as the risk of financial loss to the Group if a customer or counterparty to a financial 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 significant foreign exchange risk. In FY20 and FY21 there were no purchases of inventory from the EU, or other overseas countries and no hedging contracts were entered into. At 31 March 2021 if sterling had weakened/strengthened by 10% against the Euro, with all other variables held constant, the recalculated post-tax profit for the year would therefore have been unchanged (FY20: unchanged) as a result of foreign exchange losses/gains on the translation of euro-denominated trade payables.

Motorpoint Group plc 104 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 105

– £m £m £m £m 0.5 Total Total 2020 (0.5) Total 58.4 61.1 18.6 29.5 86.1 96.1 89.2 10.0 96.1 173.1 179.8 Motorpoint Group plc Group Motorpoint – – – – – – – – £m £m £m £m 0.4 (0.4) 2021 Fixed 35.4 35.1 35.4 35.1 2020 Annual Report and Accounts 2021 Over 5 years Over Over 5 years Over – – – – – – £m £m £m -50 +50 years years 13.6 15.2 13.6 15.2 96.1 96.1 Floating in basis points Between 2 and 5Between Between 2 and 5Between Increase/ decreaseIncrease/ – – – – – – £m £m £m 4.7 5.4 4.7 5.4 Total years years 89.2 89.2 Between 1 and 2Between Between 1 and 2Between – – – – – – – – £m £m £m 2.4 2.7 2.4 2.7 Fixed 2021 Within 1 year Within Within 1 year Within – £m £m £m 2.3 2.7 18.6 29.5 86.1 89.2 89.2 89.2 10.0 117.0 121.4 Floating Within 180 days Within Within 180 days Within The prior year comparative table has been restated to include the lease liabilities to analysis. maturity table has been restated comparative The prior year Lease liabilitiesLease 1 Lease liabilitiesLease Trade creditors and accruals creditors Trade At 31 March 2021 and 2020 the floating rate financial liabilities comprise stocking finance facilities that bear interest at rates based on at rates that bear interest finance facilities financial liabilities comprise stocking rate the floating and 2020 2021 31 March At rate. based on the LIBOR interest which bears facility credit and a revolving Rate House Base Finance constant, held to with all other variables rates, change in interest possible a reasonably the sensitivity to table demonstrates The following rate. less this amount tax at the prevailing by be impacted equity would tax. The Group’s before results the Group’s Trade creditors and accruals creditors Trade Stocking finance facilities Total Stocking finance facilities Sterling Sterling 1 risk Capital market (d) rates. changes to in interest risk, in relation primarily capital market is subject to The Group as follows: analysed financial liabilities are interest-bearing The Group’s Sterling denominated 2020 Borrowings 2021 Borrowings (c) Funding and liquidity risk and liquidity Funding (c) and other trade finance facilities, the stocking of primarily consisted sheet date at the balance Group the of The funding arrangements and £14.0m as an overdraft available £6.0m split between Santander PLC, UK by provided loan facility as an unsecured as well payables, 2020 in May Santander with UK PLC agreed was facility overdraft £15.0m month 12 A further temporary facility. credit as a revolving available these regarding information Further during the pandemic. been required help support should it have cash impacts, to short term 20. is included in note arrangements in the Viability As set out trading. depressed a period of of result funding and liquidity risk as a pandemic has increased The Coronavirus on short term with particular focus Coronavirus, the impact of to response been modelled in have scenarios various on page 38, Statement cash management. temporarily short cash flows; minimise the impact on to term actions extensive took the Group the pandemic, to In addition, in response all non-essential and reducing buyback programme suspending the share team members, furloughing pausing all capital expenditure, spend. financial liabilities its all of of the maturity a shortage business risk to funds using a long term plan that considers its of monitors The Group to cash flows and operating facilities borrowing committed sufficient have aims to The Group operations. from cash flows and the projected requirements. long term core its cover non-derivative the Group’s for (both principal and interest) cash flows undiscounted details the contractual, tableThe maturity that follows date. maturity the contractual to period at the balance sheet date on the remaining based groupings maturity relevant financial liabilities into been contracted. had already rates where at the period end, except rates using the LIBOR been calculated have payments Interest NOTES TO THE FINANCIAL STATEMENTS CONTINUED

23. Financial instruments and risk management continued (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 efficient capital structure to achieve the business plan and return excess cash to shareholders. For these purposes the Group considers capital to be shareholders’ equity, borrowings and stocking finance facilities. The Group funds its inventory and other working capital through trade creditors, stocking finance facilities, as well as an unsecured loan facility provided by Santander UK PLC, split between £6.0m available as an overdraft and £14.0m available as a revolving credit facility. A further 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. Further information regarding these arrangements is included in note 20. There are certain covenants relating to a maximum debt to equity and interest rate cover in respect of the Group consolidated financial 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, involving future branch closures, 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 2021 the Group had undrawn stocking finance facilities of approximately £16.8m (FY20: £14.9m) and undrawn credit facilities of £35.0m (FY20: £10.0m) split between £6m available as an overdraft, £14.0m available as a revolving credit facility and a temporary 12 month £15.0m uncommitted overdraft facility. (f) Fair value estimation The Group has no financial assets or liabilities carried at fair value. (g) Financial instruments by category The Group’s financial assets are all measured at amortised cost.

Carrying value 2021 £m Trade receivables 2.1 Other receivables 0.5 Accrued income 0.4 3.0

2020 Carrying value £m Trade receivables 3.0 Other receivables 1.0 Accrued income 0.1 4.1

The Group’s liabilities are classified as follows:

Other financial Liabilities not liabilities at within the scope amortised cost of IFRS 9 Total 2021 £m £m £m Borrowings – – – Trade creditors 19.4 – 19.4 Stocking finance facilities 89.2 – 89.2 Other taxes and social security – 0.7 0.7 Lease liabilities 49.3 – 49.3 Accruals 10.1 – 10.1 168.0 0.7 168.7

Other financial Liabilities not liabilities at within the scope of amortised cost IFRS 9 Total 2020 £m £m £m Borrowings 10.0 – 10.0 Trade creditors 10.6 – 10.6 Stocking finance facilities 86.1 – 86.1 Other taxes and social security – 2.2 2.2 Lease liabilities 45.4 – 45.4 Accruals 8.0 – 8.0 Contract liabilities – 0.2 0.2 160.1 2.4 162.5

Motorpoint Group plc 106 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 107

– – £m 0.9 1.0 (0.1) Amount Motorpoint Group plc Group Motorpoint 2020 5 (5) ‘000 Number (5,976) 90,190 96,166 Annual Report and Accounts 2021 – – – £m 0.9 0.9 Amount 2021 – – – ‘000 Number 90,190 90,190 1 1 1 Capital redemption reserve reserve Capital redemption reserve Capital reorganisation Post-employment benefit obligations Post-employment capital Share Share buyback Share who sell shareholders funds to and return capital the Company of the share reduce to in order £13.1m for on-market Shares Ordinary 5,981,000 purchased the Company During FY20 buyback during FY21. been no share has There their shares. the of 0.7% back and cancelled representing been bought have shares 615,000 2021, as at 31 March in 2019 buyback programme share the current of Since the commencement £1.8m. of at a cost Shares, issued Ordinary Level 1: quoted prices in active markets for identical assets or liabilities. or assets identical for markets prices quoted in active 1: Level (ie as prices) or either directly the asset or liability, for observable 1 that are prices included within Level than quoted other inputs 2: Level prices). from (ie derived indirectly inputs). data (unobservable market not based on observable the asset or liability that are for 3: inputs Level Bought back and held as treasury shares during the year shares Bought back and held as treasury Released from treasury to satisfy employee share plan obligations share to satisfy treasury employee from Released the end of the year Balance at Bought back and cancelled during the year Allotted, called Shares of 1p each up and fully paid Ordinary Balance at the beginning of the year There are currently no shares held in treasury for use to satisfy employee share plan obligations. share satisfy use to employee for held in treasury no shares currently are There authorised capital. of amount a limited does not have The Group 26. which distributable and comprises by the amount shares own its of the Group by the purchase represents reserve The capital redemption the into transferred was £0.1m) £Nil (FY20: 2006. the Companies of Act with s733 in accordance on these transactions reduced were profits cancelled. and subsequently the Group by purchased shares of in respect the year during reserve capital redemption 27. (re-registered Limited Group in Motorpoint shares of in the nominal value the capital reduction represents reserve The capital reorganisation 1p. £1 to from 2016) Plc on 10 May Group as Motorpoint 1 • • value. carried at fair has no financial instruments The Group quality of financial assets(h) Credit balances due represent financial assets The Group’s impaired. past due or that are has no financial assets the Group 18 in note As disclosed with held and cash and cash equivalents customers retail Group’s the finance to that provide financial institutions panel of a selected from Fitch a which have plc, Bank Santander UK plc and Lloyds plc, Bank in place with Barclays has banking arrangements The Group banks. their short Due to maturities the customers. its for ratings does not obtain credit The Group respectively. and A+ A- A+, of rating credit is estimated at £Nil. on financial assets loss credit expected 24. Fair value hierarchy value Fair levels: the following to reference by be measured to required are value carried at fair instruments Financial • the by payable contributions represents the year for charge The pension cost pension scheme. contribution a defined operates The Group the the scheme at the end of to payable were £0.1m) (FY20: £0.1m Contributions totalling 8. in note the scheme and is disclosed to Group included in accruals. and are year 25. NOTES TO THE FINANCIAL STATEMENTS CONTINUED

28. 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 31. At 31 March 2021 the EBT held 34,841 ordinary shares of 1p each in the Group, the market value of which amounted to £0.1m. Details of outstanding share awards and options are shown in Note 31. The consideration paid for the ordinary shares of 1p each in the Group held by the EBT at 31 March 2021 and 31 March 2020 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: 2021

Number Amount ‘000 £m Shared purchased by EBT in the year 183,494 0.4 Shares issued in respect of employee share schemes 165,093 0.3

Proceeds of £0.3m were received on the exercise of share-based payments. The weighted average cost of shares issued by the EBT was £0.3m. Subsequent to the year end employee share options over 6,721 shares had been exercised and had been satisfied by ordinary shares issued by the EBT.

29. Other commitments Capital commitments The Group had capital commitments of £Nil at 31 March 2021 (FY20: £Nil).

30. Cash flow from operating activities 2021 2020 £m £m Profit for the year attributable to equity shareholders 7.6 15.2 Adjustments for: Taxation charge 2.1 3.6 Finance costs 2.9 3.5 Operating profit 12.6 22.3 Share-based payments 0.2 (0.1) Loss on disposal of property, plant and equipment and right-of-use assets 0.1 0.1 Depreciation charge 5.7 5.0 Cash flow from operations before movements in working capital 18.6 27.3 (Increase) / Decrease in inventory (16.6) 4.4 (Increase) / Decrease in trade and other receivables (3.3) 8.6 Increase / (Decrease) in trade and other payables 13.7 (7.1) Cash flow from operating activities 12.4 33.2

31. 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 the year the Restricted Shares Award (‘RSA') was introduced which operates under the rules of the PSP scheme. The total charge in the year relating to the three schemes including associated national insurance (‘NI') charges was £0.2m (FY20: £0.1m credit). NI is being accrued, where applicable, at a rate of 13.8% 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 2021 relating to all awards was a charge of £Nil (FY19: £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. Performance Share Plan The Group operates a Performance Share Plan for Executive Directors and certain key senior managers.

Motorpoint Group plc 108 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 109

£ No No No No No No No Yes Yes Yes Yes Yes Yes Yes Yes Yes 0.32 0.49 0.50 0.89 0.94 option criteria Number 94,213 of options 837,682 2,104,168 (957,616) (506,180) 2,730,282 Performance Performance Fair value per value Fair 2020 £ £ Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil Nil price 0.61 0.87 0.55 2.77 2.30 1.89 1.77 1.12 0.66 Motorpoint Group plc Group Motorpoint (0.07) average average (0.94) % exercise exercise Weighted Weighted 27.1 27.1 27.1 27.1 27.1 Exercise price Exercise condition Annual Report and Accounts 2021 Non-vesting Non-vesting options £ 116,244 Number of of Number 534,087 (611,026) 1,872,196 (155,033) 2,104,168 0.940 0.890 0.500 1.385 0.490 2.300 0.320 1.877 2.480 2.480 2.447 2.336 2.420 2.204 2.204 1.877 2021 % grant date5 grant £ Fair value at value Fair 3.10 2.85 2.85 3.00 1.29 price 1.34 0.74 0.57 0.55 (1.53) (0.41) average average exercise exercise Weighted Weighted Dividend yield granted – – – – – – 37,877 18,938 18,938 259,001 222,040 283,012 830,267 417,765 596,659 770,041 118,716 199,333 323,303 203,620 412,022 194,023 FY20 4,905,555 % 2.5 2.5 2.5 2.5 2.5 – – – Number of shares RSA FY21 (6,908) Risk-free rate Risk-free 268,178 275,086 – FY20 12,221 Settlement type cash-settled 3.0 3.0 3.0 3.0 3.0 years 615,642 1,522,841 equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled equity-settled 1,459,519 (678,964) PSP Option life – N/A N/A FY21 23,416 Lapse date (13,668) 962,361 21-Jul-27 20-Jul-28 22-Jul-29 22-Jul-29 1-Aug-24 1-Aug-23 1-Aug-22 1-Aug-21 1-Aug-20 1,459,519 (483,490) 23-Jun-26 24-Aug-30 24-Aug-30 24-Aug-30 24-Aug-30 % 33.0 34.3 34.5 37.5 51.7 FY20 18,947 581,604 222,040 (423,747) 1,058,273 (274,962) Expected volatility SAYE 1-Apr-21 1-Feb-24 1-Feb-23 1-Feb-22 1-Feb-21 1-Feb-20 Vesting date Vesting 21-Jul-20 22-Jul-21 22-Jul-22 22-Jun-19 27-Jun-19 £ 22-Dec-20 24-Aug-23 24-Aug-24 24-Aug-25 24-Aug-23 FY21 37,655 1.28 1.97 2.04 2.89 2.81 259,001 581,604 586,484 (120,628) (133,493) grant date grant – Share price atShare FY20 Grant date Grant 21-Jul-17 20-Jul-18 22-Jul-19 22-Jul-19 63,045 63,045 (3,690) 149,168 23-Jun-16 27-Jun-16 (82,433) 23-Dec-20 23-Dec-19 21-Dec-18 27-Dec-17 27-Dec-16 22-Dec-17 24-Aug-20 24-Aug-20 24-Aug-20 24-Aug-20 SIP – – FY21 55,173 55,173 (7,872) 63,045 2 3 4 4 4 4 2 1 Awards under the SIP cash-settled plan vested and were exercised during the year resulting in a total of £0.2m cash payment to the eligible participants. to cash payment £0.2m of in a total resulting during the year exercised and were plan vested under the SIP cash-settled Awards at the balance sheet date. zero to value the fair conditions reduces non-vesting assumption of The current date. at grant value the fair of 51% to value the fair conditions reduces non-vesting assumption of The current date. at grant value the fair of 73% to value the fair conditions reduces non-vesting assumption of The current the scheme. participants leaving due to vest to not expected shares the number of applying an assumption for is prior to above as disclosed date at grant value The fair at 31 FY March at 31 FY March lapsed at 1 April FY The maximum subscription offered is £3,600 (equivalent to £100 per month over the 36 month saving period). Contributions from salary are salary are period). Contributions from saving the 36 month over £100 per month to (equivalent is £3,600 The maximum subscription offered with their saved rate at the discounted buy shares their option to participants can exercise and on maturity account a savings made into them. to the funds returned or have contributions 27 December 2016 27 SAYE21 27 December 2017 27 SAYE20 FY19 PSP FY19 SAYE19 21 December 2018 The assumptions used in the measurement of the fair value at grant dates of the SAYE scheme are as follows. scheme are the SAYE dates of at grant value the fair of The assumptions used in the measurement Exercisable Exercisable FY18 PSP SAYE18 Outstanding 23 December 2019 Exercised FY17 PSP FY21 RSA (B) FY21 RSA (C) FY21 RSA (D) FY21 RSA SAYE17 FY20 PSP (A) PSP FY20 (B) PSP FY20 (A) FY21 RSA SIP Forfeited / Forfeited Awarded Plan SIP Restricted Share Award (‘RSA’) (‘RSA’) Award Share Restricted is not the shares of but the vesting is scaled back significantly, level that the grant in a way shares performance from differ shares Restricted underpin). than a performance conditions (other specific future subject to scheme SAYE the Company’s options over subscribe for to invited are under which employees all employees scheme for a SAYE operates The Group date. the invitation before price the day mid-market the closing to discount a 10% price representing at an exercise shares 2 3 4 5 1 23 December 2020 Outstanding NOTES TO THE FINANCIAL STATEMENTS CONTINUED

31. Share-based compensation continued Expected volatility is estimated by considering historic average share price volatility of Motorpoint Group Plc share price at the grant date, unless there was no significant history, resulting in volatility being based on the historic share price movement of a selection of comparative companies. 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. FY21 SAYE FY20 SAYE FY19 SAYE FY18 SAYE

Option Option Option Option exercise exercise price exercise price exercise price Number price £ Number £ Number £ Number £ Outstanding at 1 April 2020 – – 209,385 2.300 187,595 1.890 184,624 1.773 Awarded 259,001 2.772 – – – – – – Forfeited (10,709) – (43,805) – (45,786) – (20,328) – Vested / early exercise – – (1,358) – (5,494) – (126,641) – Outstanding at 31 March 2021 248,292 – 164,222 – 136,315 – 37,655 –

The total charge in the year, included in administrative expenses, in relation to these awards was £0.1m (FY20: £Nil). Payments of £0.9m were made during FY20 to acquire shares for an employee benefit trust to satisfy the share plan obligations of the SAYE 2017 scheme. This scheme was ultimately cash settled to employees as a result of conditions at the time of vesting. The scheme has fully vested and therefore the full reserve of £0.9m has been transferred to equity during the period. The weighted average remaining contractual life of the outstanding share options based on the relevant vesting date as at the year end is 1.4 years (2020: 1.4 years).

32. 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 9 to the Financial Statements and their beneficiary owned shares are detailed in the Remuneration Committee Report on page 69.

Motorpoint Group plc 110 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 111

– £m 0.9 0.1 (7.0) 2020 (0.9) 53.8 54.8 54.8 74.8 (13.1) (46.3) (46.3) (46.3) (46.3) 101.1 101.1 101.1 Motorpoint Group plc Group Motorpoint – – £m 0.2 0.9 0.1 (0.1) 2021 54.9 53.9 54.9 53.8 (46.4) (46.4) (46.4) (46.4) 101.3 101.3 101.3 Annual Report and Accounts 2021 9 7 4 5 7 8 Note AS AT 31 MARCH 2021 MARCH 31 AT AS COMPANY BALANCE SHEET BALANCE COMPANY C Morgan Officer Chief Financial Share-based payments Share-based (Loss) / Result for the year for / Result (Loss) Buyback and cancellation of shares At 1 April 2020 and 2019 1 April 2020 At Dividends

Total equity Total Total non-current assets non-current Total assets Total Liabilities liabilitiesCurrent 1 year due within falling amounts Creditors: Assets assetsNon-current Investments Total current liabilities current Total liabilities current Net liabilities Total assetsNet Equity capitalCalled up share Capital redemption reserve Capital redemption earnings Retained M Carpenter The notes on pages 113 to 116 are an integral part these of financial statements. an integral are 116 to The notes on pages 113 behalf by: its signed on and were June 2021 on 16 Directors of the Board by approved were 116 to on pages 111 The financial statements Officer Chief Executive Plc Group Motorpoint number 10119755 Registered COMPANY STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 31 MARCH 2021

Capital Called up redemption share capital reserve Retained earnings Total equity Note £m £m £m £m At 1 April 2019 1.0 – 74.8 75.8 Result for the year – – – – Transactions with owners in their capacity as owners: Share‑based payments – – (0.9) (0.9) Buyback and cancellation of shares 7 (0.1) 0.1 (13.1) (13.1) Final dividend for the year ended 31 March 2019 9 – – (4.7) (4.7) Interim dividend for the year ended 31 March 2020 9 – – (2.3) (2.3) (0.1) 0.1 (21.0) (21.0)

At 31 March 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 Balance at 31 March 2021 0.9 0.1 53.9 54.9

Motorpoint Group plc 112 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 113

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 NOTES TO THE COMPANY FINANCIAL STATEMENTS FINANCIAL COMPANY THE TO NOTES Summary of significant policies accounting 1. 2006. the Companies Kingdom under Act and domiciled in the United incorporated is Plc (the Company) Group Motorpoint is office the registered of the address Exchange; Stock on the London and is listed shares by limited is a public company The Company is to the Company principal activity of The Kingdom, DE21 6BZ. United England, Derby, Industrial Estate, Meadows West Drive, Chartwell a holding company. and that of the Group to services the the Directors of provide (a) Basis of preparation Kingdom accounting with United in accordance been prepared have 2021 ended 31 March the year for financial statements These Company the under on a going concern basis, prepared are These financial statements 2006. Companies 102 and the Act FRS including standards unless otherwise stated. presented, all the years applied to been consistently policies The accounting have convention. cost historical that the the going concern principle on the basis used Plc and have Group Motorpoint of also Directors are the Company of The Directors a period not less months than 12 for in operation will continue Group the consolidated of and facilities financial projections profitable current subsidiary of is a wholly owned Limited as Motorpoint however liability position; a net current is in Company The this report. of the date from further details the going of For has the means repay. to outstanding balances unless those be settled the Company will not the Company, see page 88. the Group concern status of and the Company of currency and presentational which is the functional in sterling been prepared have financial statements The Company £m. in round been presented have is not included as part and loss the published consolidated of profit an entity 2006 the Companies of Act section 408 under As permitted Plc. Group Motorpoint of financial statements Critical judgements accounting (b) and applying the Group of process in the judgement its exercise to management requires the financial statements of The preparation the consolidated 4 to in note disclosed are or complexity judgement of degree a higher involving policies. accounting The areas Company financial the Company for relevant are in assessing the Group the going concern of involved The judgement financial statements. statements. in subsidiaries Investment (c) or events consider whether any the Directors impairment. Annually, for provision cost, less held at any in subsidiaries are Investments If such not be recoverable. may asset investments that the carrying fixed of that could indicate amount occurred have circumstances net realisable higher of the establish to whether the carrying exceed amounts is undertaken review a full impairment do exist, circumstances Where investment. related the of the carrying value reduce to is recorded charge an impairment If this is the case, in use. or value value as a is treated the award of value subsidiary of companies, the fair the employees to compensation is granted share-based equity-settled this capital contribution. reflect to adjusted in subsidiaries are and investments the Company capital by contribution Dividend distribution(d) in which in the period financial statements as a liability in the Company’s is recognised shareholders the Company’s Dividend distribution to shareholders. the Company’s by approved the dividends are instruments Financial (e) Financial financial instruments. of and measurement the recognition of 102 in respect FRS of and 12 sections 11 is applying The Company becomes party the contractual to Company balance sheet when the Company’s in the recognised and financial liabilitiesassets are the instrument. of provisions financial liabilities as financial assets, or equity parts, on initial recognition or their component classifies financial instruments, The Company into. entered arrangements the substance the contractual of to according instruments (f) equity Financial liabilities. after its Equity deducting all of the Company of in the assets interest that evidences a residual contract is any An equity instrument issue costs. direct net of received, as the proceeds recorded are the Company issued by instruments liabilities(g) Financial through value at amortised or at fair cost as either other financial liabilities measured classified on initial recognition liabilities are Financial or loss. profit capital (h) Share the equity instrument. from deducted in issuing equity are incurred Costs classified as equity. are Shares Ordinary benefits (i) Employee (i) Pensions the of those NOTES TO THE COMPANY FINANCIAL STATEMENTS CONTINUED

1. Summary of significant accounting policies continued (i) Employee benefits continued (ii) Other employee benefits The Group recognises an expense for other short-term employee benefits, 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 effect 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 31 of the Group’s financial 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 effect 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 reflect 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 flow statement and disclosure in relation to share-based compensation and key management compensation, since equivalent disclosures are included in the consolidated financial statements of the Group headed by Motorpoint Group Plc.

2. Auditor’s remuneration 2021 2020 £’000 £’000 Auditor’s remuneration: Fees payable for the audit 174 125 Fees payable for the audit of the Company’s subsidiaries 15 19 Audit-related assurance services1 – 22 Total 189 166

1 Audit-related assurance services comprise fees payable to the Group’s auditor for carrying out a review of the Group’s interim results in accordance with International Standard on Review Engagements (UK and Ireland) 2410.

3. Employees and Directors The Company has no employees other than Directors (FY20: none). Full details of the Directors’ remuneration and interests are set out in the Remuneration Committee Report on pages 66 to 69. There were no transactions with related parties other than Directors and key management remuneration including share-based payment as detailed in note 9 to the consolidated financial statements. The shares beneficiary owned by the Directors of the Company are detailed in the Remuneration Committee Report on page 69.

4. Investments 2021 2020 £m £m At 1 April 101.1 100.9 Share-based payment charge 0.2 0.2 At 31 March 101.3 101.1

Motorpoint Group plc 114 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 115

– – £m £m £m 0.9 1.0 2020 2020 (0.1) 36.3 46.3 10.0 46.3 46.3 Amount Motorpoint Group plc Group Motorpoint 2020 – 5 (5) £m £m ‘000 2021 2021 46.4 46.4 46.4 46.4 Number (5,976) 90,190 96,166 Annual Report and Accounts 2021 03482801 04100916 09603690 Not applicable Registered number Registered – – – £m 0.9 0.9 Amount 2021 – – – ’000 Number 90,190 90,190 Motor vehicle retail vehicle Motor Dormant Dormant benefit scheme Employee Principal activity 1 1 Chartwell Drive, West Meadows West Drive, Chartwell England, Derby, Industrial Estate, DE21 6BZ Registered address Registered 80 Mount Street, Nottingham, Street, Mount 80 NG1 6HH England, Meadows West Drive, Chartwell England, Derby, Industrial Estate, DE21 6BZ JE2 3RT Jersey, Castle12 Street, 1 1 2 Called up share capitalCalled up share During FY20 the Company purchased 5,981,000 Ordinary Shares on-market for £13.1m in order to reduce the share capital of the Company and return funds to shareholders who sell shareholders funds to and return capital the Company of the share reduce to in order £13.1m for on-market Shares Ordinary 5,981,000 purchased the Company During FY20 buyback during FY21. has been no share There their shares. the of 0.7% back and cancelled representing been bought have shares 615,000 2021, as at 31 March in 2019 buyback programme share the current of Since the commencement £1.8m. of at a cost Shares, issued Ordinary These subsidiary undertakings are entitled to exemptions under sections 476 and 480 of the Companies Act 2006 relating to dormant companies. Dormant company accounts have have accounts companies. company dormant Dormant to relating 2006 the Companies of Act and 480 sections 476 under exemptions to entitled These subsidiary undertakings are these both of entities. been filed for financial statements. the consolidated 2 to as detailed in note has control on the basis that the Company the Group of in the financial statements is consolidated The EBT Creditors: amounts falling due within 1 year amountsCreditors: falling Bought back and cancelled during the year Bought back and held as treasury shares during the year shares Bought back and held as treasury Amounts due to Group undertakings are repayable on demand, unsecured and non-interest bearing. See note 10 for further details on bearing. 10 for See note and non-interest on demand, unsecured repayable undertakings are Group due to Amounts borrowings. instruments Financial 6. as follows: be analysed may 2021 ended 31 March during the year the Company utilised by instruments Financial Released from treasury to satisfy employee share plan obligations share to satisfy treasury employee from Released Amounts owed to Group undertakings to Group Amounts owed their and accordingly short in nature term generally cash) are and liabilities assets (excluding included within current instruments Financial their book values. to approximate values fair their book value. is equal to value their fair on demand and therefore repayable financial liabilities are The Company’s 7. Chartwell Leasing Limited Leasing Chartwell Auction 4 Cars Limited Auction Plc Employee Group Motorpoint Trust Benefit Allotted, called up and fully paid Ordinary Shares of 1p each Balance at the beginning of the year Financial liabilities measured at amortised cost liabilities measured Financial Bank loans and overdrafts There are currently no shares held in treasury for use to satisfy employee share plan obligations. share satisfy use to employee for held in treasury shares no currently are There authorised capital. of amount a limited does not have The Company 1 5. 1 2 Motorpoint Limited Motorpoint Subsidiary undertakingSubsidiary At 31 March 2021 the Company had the following 100% owned subsidiary companies all of whom are registered in England and Wales. and Wales. in England registered subsidiary companies are whom of all owned 100% had the following the Company 2021 31 March At subsidiary. only direct is the Limited Motorpoint NOTES TO THE COMPANY FINANCIAL STATEMENTS CONTINUED

8. Capital redemption reserve The capital redemption reserve represents the purchase by the Company of its own shares and comprises the amount by which distributable profits were reduced on these transactions in accordance with s733 of the Companies Act 2006. £Nil (FY20: £0.1m) was transferred into the capital redemption reserve during the year in respect of shares purchased by the Company and subsequently cancelled.

9. Dividends During the year no dividends were paid:

2021 2020 £m £m Final dividend for the year ended 31 March 2019 – 4.7 Interim dividend for the year ended 31 March 2020 – 2.3 Total dividends – 7.0

The Board has not proposed a final dividend (FY20: Nil) for the year ended 31 March 2021.

10. Borrowings The Company’s available borrowings consist of an unsecured loan facility provided by Santander UK PLC, split between £6.0m available as an overdraft and £14.0m available as a revolving credit facility. A further 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 additional facility was not used. The existing £20.0m facility expires in May 2024. As at the reporting date £Nil (FY20: £10.0m) was drawn down. The finance charge for utilising the facility is dependent on the Group’s borrowing ratios as well as the base rate of interest in effect. During the year ended 31 March 2021 interest was charged at 1.4% (FY20: 1.4%) per annum. The interest charged for the year of £0.1m (FY20: £0.2m) has been expensed as a finance cost. 11. Commitments and contingencies Capital commitments The Company had nil capital commitments at 31 March 2021 (FY20: £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 £80.0m (FY20: £75.0m) stocking finance facility with Black Horse Limited.

12. Related parties During the year, a management charge of £0.8m (FY20: £0.8m) was received from Motorpoint Limited in respect of services rendered. In addition, a £10.0m repayment of the revolving credit facility was repaid by Motorpoint Limited on behalf of the Company. During the year Motorpoint Limited paid interest of £0.2m (2020: £0.2m) on behalf of the Company. On behalf of Motorpoint Group PLC, Motorpoint Limited paid Directors’ salaries and fees of £0.9m (FY20: £1.0m) during the year and has recharged this to Motorpoint Group Plc. At the year end the balance outstanding due to Motorpoint Limited totalled £46.4m (FY20: £36.3m). The Company grants share awards to employees of Motorpoint Limited as detailed in note 31 to the consolidated financial statements. As a result, a share based-payment charge of £0.2m (2020: £0.9m) as disclosed in the Company’s Statement of Equity with a corresponding increase in Investments.

Motorpoint Group plc 116 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 117

- £m £m £m 5.0 3.5 2020 2020 2020 27.3 22.3 33.2 18.8 78.9 (56.6) 148.9% 139.4% Motorpoint Group plc Group Motorpoint - £m £m £m 5.7 2.9 9.7 2021 2021 2021 18.3 12.6 12.4 62.5 (49.9) 98.4% 125.3% Annual Report and Accounts 2021 ALTERNATIVE PERFORMANCE MEASURES PERFORMANCE ALTERNATIVE EBITDA EBITDA Amortisation In the current and prior year adjusted overheads is equal to operating expenses as a result of there being no exceptional items. being no exceptional there of as a result expenses operating is equal to overheads adjusted and prior year In the current cash conversion Operating is as follows: this measure The calculation of cash conversion. operating based on financial performance also measure We Cash generated from operations / operating profit / operating operations Cash from generated Depreciation Gross profit / adjusted overheads profit Gross Operating profit Operating expense Finance Adjusted overheads Adjusted Profit before tax before Profit Year ended 31 March ended 31 Year Cash generated from operations Cash from generated Year ended 31 March ended 31 Year Gross profit Gross Year ended 31 March ended 31 Year Introduction and are not defined under IFRS are that measures performance alternative of using a variety Group the of assess the performance We EBITDA, adjusted PBT; adjusted profit; operating adjusted use are: we measures The non-GAAP measures. non-GAAP termed therefore along with a using these measures, for The rationale and EBITDA. cash conversion; operating ratio; overheads GP/adjusted EPS; adjusted below. is presented with IFRS, in accordance prepared measures the nearest from reconciliation other companies. used by with similarly titled measures comparable not be directly use may The APMs we and adjusted EBITDA PBT adjusted profit, operating Adjusted based on adjusted performance also measure we profit, operating based on the Group of measuring financial performance In addition to be useful to EBITDA and adjusted Profit Operating adjusted PBT, consider adjusted We EBITDA. and adjusted PBT adjusted profit, operating and so items eliminating exceptional by the underlying profitability approximate because they performance our operating of measures the ongoing profitability. of understanding a better reflect items. no exceptional were there and prior year In the current EPS Adjusted calculations. EPS the GAAP from items exceptional excludes measure This EPS. adjusted based on financial performance also measure We items. no exceptional were there and prior year In the current ratio overheads GP/adjusted is as follows: this measure The calculation of ratio. overheads profit/adjusted our gross based on financial performance also measure We GLOSSARY

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 Profit Operating Profit before Exceptionals Adjusted Overheads Operating Expenses before Exceptionals Adjusted PBT Profit 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 Officer CFO Chief Financial Officer CJRS Coronavirus Job Retention Scheme DEFRA Department for Environment, Food and Rural Affairs DTR Disclosure Guidance and Transparency Rules EBITDA Earnings Before Finance Expense, Tax, Depreciation and Amortisation EBT Employee Benefit 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 Profit GP/Adjusted Overheads Gross Profit/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 Offering LIBOR London Interbank Offered 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 profit PBT Profit Before Tax PCI Payment Card Industry PCP Personal Contract Purchase PSP Performance Share Plan PwC PricewaterhouseCoopers LLP ROCE Return On Capital Employed, being Operating Profit/Capital Employed 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 finance facilities VED Vehicle Excise Duty

Motorpoint Group plc 118 Annual Report and Accounts 2021 Strategic Report Governance Financial Statements 119

Motorpoint Group plc Group Motorpoint Annual Report and Accounts 2021 Financial PR Financial Chris Morgan Motorpoint Drive Chartwell Industrial Estate Meadows West DE21 6BZ Derby Annual General Meeting Annual General Update Trading Half Year Announcement Results Interim SHAREHOLDER INFORMATION & ADVISERS & INFORMATION SHAREHOLDER Legal advisers Legal Masons LLP Pinsent Place 30 Crown 4ES EC2A London Registrar Link Group 10 Unit Square Central Street Wellington 29 Leeds 4DL LS1 PR Financial FTI Consulting Aldersgate 200 Street Aldersgate 4HD EC1A London 1000 3727 20 +44 Tel: Bankers Santander UK Plc 2 Clumber Street NG1 3GA Nottingham calendar Financial July 2021 27 2021 October Early 2021 25 November Shareholder enquiriesShareholder standard at the charged are 0300 (calls 664 on 0371 shareholdings your questions regarding will be pleased deal with any to Our registrars where can access www.signalshares.com you Alternatively, or email [email protected]. provider) by and will vary rate geographic enquiries account communications, or address electronic including securely shareholding your of and manage all aspects can view you amendments. website relations Investor In in Motorpoint. interested anyone for further information provides www.motorpointplc.com, our website, section of relations The investor are announcements results including the full year announcements Company price, and share and Accounts the Annual Report addition to also published there. statements forward-looking Cautionary note regarding and expectations based on current are statements Such statements. forward-looking are Certain this Report made in statements any from materially differ to or results and uncertainties events risks that could cause actual a number of subject to assumptions and are appear places They in a number of throughout statements. or implied in these forward-looking expressed or results events future expected concerning, amongst other the Directors of expectations or current beliefs the intentions, regarding and include statements this Report this receiving and the business. Persons strategies growth, prospects, financial condition, liquidity, operations, of results the Group’s things, or regulations applicable laws, by otherwise Unless required statements. on forward-looking place undue reliance should not Report of whether as a result statements, forward-looking any or revise update to Plc does not undertake Group Motorpoint standards, accounting or otherwise. developments future information, new Independent Auditor LLP PricewaterhouseCoopers CourtDonington Business Park Pegasus Way Herald 2UZ Midlands DE74 East Registered office Registered number Company 10119755 secretary Company Chris Morgan stock brokers Joint Numis Securities Limited Building Exchange Stock The London Square 10 Paternoster 7LT EC4M London Limited Capital Stockbrokers Shore House Street Bond Street Clifford 14 W1S 4JU London listing Share on the London listed are Shares 1 pence Ordinary MOTR.L in issue shares the only class of and are Exchange Stock Motorpoint Drive Chartwell Industrial Estate Meadows West DE21 6BZ Derby Kingdom United NOTES

Motorpoint Group plc 120 Annual Report and Accounts 2021

Motorpoint Group plc Annual Report and Accounts 2021 Motorpoint Group plc Group Motorpoint Drive Chartwell Industrial Estate Meadows West Derby DE21 6BZ