TIDMEXO
RNS Number : 8537Q
Exova Group PLC
03 March 2016
2015 FULL YEAR RESULTS ANNOUNCEMENT
3 March 2016
Exova Group plc ("Exova"), a leading international provider of
technically demanding testing and advisory services announces its
full year results for the year ended 31 December 2015.
Solid performance with strong revenue growth
-- Revenue up 9.9% at constant currency; 7.9% at actual rates
o 2.3% organic growth at constant currency demonstrating the
benefit of diversification
o 7.6% growth from M&A activity
-- 7.7% organic growth at constant currency excluding Oil & Gas and Industrials
-- Eight M&A transactions completed with encouraging pipeline
-- Proposed final dividend of 2.2p per share
Adjusted results(1) Growth from
Organic acquisitions
growth net of disposals
2015 2014 Reported at constant at constant
GBPm GBPm growth currency currency
--------------------- ------- --------- ----------- -------------- ------------------
Revenue 296.5 274.9 7.9% 2.3% 7.6%
--------------------- ------- --------- ----------- -------------- ------------------
EBITA 46.7 46.2 1.1%
--------------------- ------- --------- ----------- -------------- ------------------
Profit before tax 40.4 39.8(2) 1.5%
--------------------- ------- --------- ----------- -------------- ------------------
EBITA margin 15.8% 16.8%
--------------------- ------- --------- ----------- -------------- ------------------
Pro-forma earnings
per share 12.2p 11.9p(2)
--------------------- ------- --------- ----------- -------------- ------------------
Statutory results(3) 2015 2014 Reported
GBPm GBPm growth
---------------------- ------ -------- ---------
Operating profit 29.5 19.6 50.5%
---------------------- ------ -------- ---------
Profit / (loss)
before tax 23.2 (23.7)
---------------------- ------ -------- ---------
Earnings per share 6.8p (16.6)p
---------------------- ------ -------- ---------
Proposed final
dividend per share 2.2p 2.0p
---------------------- ------ -------- ---------
Notes:
1) Adjusted results is operating profit from continuing
operations before separately disclosed items, 2014 management fee
to private equity investor, interest and taxation.
2) 2014 pro-forma profit before tax and adjusted earnings per
share have been calculated as if the post IPO capital and debt
structure had been in place throughout that year.
3) Statutory results for 2014 reflect pre-IPO funding structure
and IPO transaction costs.
Ian El-Mokadem, Chief Executive Officer, commented:
"We are pleased to have delivered results which are in line with
our guidance, demonstrating the strength of our diversified
business and our ability to respond to changing market conditions.
We delivered strong overall growth, with solid organic performance
enhanced by our most successful year to date for acquisitions. The
Group expects to deliver modest organic growth at constant currency
in 2016 due to the strength of our portfolio and model.
Our medium-term revenue expectation remains mid-single digit
organic growth, supplemented by acquisitions."
Contacts
For further information please contact:
Ian Middleton, Powerscourt Group
Tel. Direct +44 (0)20 7549 0998 / +44 (0)7885 508 527
exova@powerscourt-group.com
Sophie Moate, Powerscourt Group
Tel. Direct +44 (0)20 7549 0994 / +44 (0)7761 974 589
exova@powerscourt-group.com
Ian Power, Investor Relations
Exova Group plc
Telephone: +44 (0) 131 476 7619
investor.relations@exova.com
Analyst briefing and conference call
There will be an analyst briefing and conference call today at
9.30am GMT, held at Investec Bank PLC, Room 701, 7(th) Floor, 2
Gresham Street, London EC2V 7QP. If you would like to attend the
meeting, please contact Powerscourt Group at the above mentioned
e-mail address. A copy of the presentation is available on the
website.
Corporate website: www.exova.com
Exova
Exova is one of the world's leading laboratory-based testing
groups, trusted by organisations to test and advise on the safety,
quality and performance of their products and operations.
Headquartered in Edinburgh, UK, Exova operates 145 laboratories and
offices in 32 countries and employs around 4,500 people throughout
Europe, the Americas, the Middle East and Asia/Asia Pacific.
Exova's capabilities help to extend asset life, bring
predictability to applications, and shorten the time to market for
customers' products, processes and materials. With over 90 years'
experience, Exova specialises in testing across a number of key
sectors from health sciences to aerospace, transportation, oil and
gas and construction.
FULL YEAR REPORT 2015
BUSINESS REVIEW
The principal activities of the Group are specialist testing and
advisory services and the key markets served are Aerospace; Oil
& Gas and Industrials; Product and Certification; Health
Sciences and Middle East.
Exova operates primarily in the Testing segment of the Testing,
Inspection and Certification ("TIC") sector. It has a growing
Certification business, as well as providing Inspection services in
a number of niche markets and geographies.
The business comprises 145 permanent facilities in 32 countries
and employs around 4,500 people.
Overview of performance
2015 Growth Organic
GBPm 2014 at reported growth
GBPm exchange at constant
rates exchange
rates
--------------------- ------ --------- ------------- -------------
Revenue 296.5 274.9 7.9% 2.3%
Adjusted EBITA(1) 46.7 46.2 1.1%
EBITA margin 15.8% 16.8%
Net finance costs (6.3) (43.3)
Income tax expense (4.7) (5.0)
Earnings per share 6.8p (16.6)p
Pro-forma adjusted
earnings per share 12.2p 11.9p(2)
Dividend per share 2.2p 2.0p
Cash conversion(3) 59% 68%
--------------------- ------ --------- ------------- -------------
Notes:
1) Adjusted items are stated before separately disclosed items,
2014 management fee to private equity investors, interest and
taxation
2) 2014 pro-forma adjusted earnings per share have been
calculated as if the post IPO capital and debt structure had been
in place throughout that year.
3) The cash conversion ratio is calculated by dividing free cash
flow by adjusted EBITDA. Free cash flow is defined as adjusted
EBITDA less movement in net working capital (excluding the effect
of the IPO related cost accrual), less capital expenditure net of
disposals.
Revenue
2015
GBPm Growth
----------------------------- -------- ---------
2014 reported
Constant currency 274.9
Organic 6.3 2.3%
Acquisitions 22.5 8.2%
Disposals (1.6) (0.6%)
------------------------------- -------- ---------
Growth at constant currency 302.1 9.9%
Currency effect (5.6) (2.0%)
------------------------------- -------- ---------
2015 reported 296.5 7.9%
------------------------------- -------- ---------
Revenue for the year was GBP296.5m which represented organic
growth at constant currency of 2.3%.
Acquisitions contributed 8.2% of growth, partly offset by two
small disposals which resulted in a reduction of 0.6%. The Group
reports in sterling which strengthened during the course of the
year over the currencies in most of the territories in which the
Group operates. This resulted in a negative translational effect of
2.0%.
Adjusted EBITA margin
Adjusted EBITA margin decreased by 100bps from 16.8% to 15.8%.
This reflects the reduction in Oil & Gas and Industrials, plus
business investments (including acquisitions) which negatively
affected margins.
Separately disclosed items
2015 2014
GBPm GBPm
----------------------------------- ------ ------
Amortisation of intangible assets 8.9 9.3
Restructuring costs 4.9 2.2
Acquisition and integration costs 3.4 1.6
IPO related costs - 13.3
----------------------------------- ------ ------
Total 17.2 26.4
----------------------------------- ------ ------
Amortisation of intangible assets
Amortisation of intangible assets for 2015 was GBP8.9m, a
decrease of GBP0.4m from GBP9.3m in 2014. This decrease was due to
customer relationships acquired from Bodycote now fully amortised
partly offset by customer relationship amortisation relating to
acquisitions made over the last three years.
Restructuring costs
We incurred GBP4.9m of restructuring costs in 2015, compared to
GBP2.2 m in 2014. This represents mainly staff redundancy costs
relating to rationalisation and restructuring of certain
laboratories and administrative departments.
(MORE TO FOLLOW) Dow Jones Newswires
March 03, 2016 02:01 ET (07:01 GMT)
Restructuring costs in 2014 mainly related to closure or
disposal of three Oil & Gas and Industrials sites in Norway,
Sweden and Canada and other restructuring in this sector.
Acquisition and integration costs
With eight acquisitions completed in 2015 compared to three in
2014, these costs primarily related to the acquisition and
integration of BM TRADA Group Limited, Environmental Evaluation
Limited, Western Technical Services Limited and on-going expenses
to support the pipeline, some of which are expected to close in
2016.
IPO related costs
No IPO related costs were incurred in 2015. In 2014 GBP13.3m of
costs relating to the IPO were incurred. These costs primarily
related to commissions, legal, accounting and other adviser fees
including irrecoverable VAT in connection with the IPO.
Net finance costs 2015 2014
---------------------------------
GBPm GBPm
--------------------------------- ----- ------
Net cash interest payable
Bank loans and senior loan
notes 5.0 10.1
Other loans and charges 0.1 0.7
Make whole on senior loan
notes - 15.5
Interest income on short-term
deposits - (0.3)
--------------------------------- ----- ------
5.1 26.0
--------------------------------- ----- ------
Non-cash costs
Amortisation of debt issue
costs 0.7 0.5
Pension interest 0.4 0.1
Unwind of discount on leasehold
dilapidations 0.1 0.1
Loan due to parent undertaking - 8.1
Write-off of historical
debt issue costs - 7.5
Preference share dividend - 1.0
1.2 17.3
--------------------------------- ----- ------
Net finance costs 6.3 43.3
--------------------------------- ----- ------
Net cash interest payable in the year decreased from GBP26.0m to
GBP5.1m primarily as a result of the refinancing associated with
the IPO in April 2014. The increase in pension interest in the
current year relates to the retirement benefit obligation assumed
with the BM TRADA Group Limited acquisition.
Earnings per share ("EPS")
Basic earnings per share for the twelve months ended 31 December
2015 was 6.8p (2014: (16.6) p).
Pro-forma adjusted earnings per share for the twelve months
ended 31 December 2015 was 12.2p (2014: 11.9p). This measure
calculates EPS before separately disclosed items and in 2014 was
calculated as if the post IPO capital and debt structure had been
in place throughout that year.
Dividend
In line with guidance given at the time of the IPO, the Board is
recommending a final dividend of 2.2p per share (2014: 2.0p per
share) which, together with the interim dividend of 1.0p per share
represents a pay-out ratio of 26% of adjusted net income. This
reflects the long-term confidence in the business. The dividend
will be paid on 10 June 2016 to shareholders on the register at the
close of business on 27 May 2016.
Acquisitions
During 2015 the Group completed eight acquisitions.
On 9 February 2015, the Group acquired 100% of the share capital
of Environmental Evaluation Limited (EEL) for a consideration of
GBP5.4m. The company helps UK customers meet environmental
regulations through the provision of asbestos testing and
inspection, stack sampling and occupational hygiene advisory
services and is recognised as a leading provider of asbestos
management services for the nuclear decommissioning industry. The
acquisition added 83 colleagues and forms part of the Group's
Health Sciences cluster.
On 13 May 2015, the Group acquired 100% of the share capital of
BM TRADA Group Limited ("BM TRADA"). The purchase consideration was
GBP11.1m (net of cash acquired) plus the assumption of a retirement
benefit obligation of GBP11.4m (net of deferred tax). BM TRADA adds
to the Group's existing Fire and Building Products testing and
certification services and provides a new platform for growth in
the attractive area of management systems certification. BM TRADA
employs 340 people across 16 countries with annual turnover in
excess of GBP20.0m and has become part of our Product and
Certification cluster.
On 2 December 2015, the Group acquired 100% of the share capital
of Western Technical Services Limited and Accusense Systems
Limited, a specialist provider of non-destructive testing and
inspection of components and equipment in the food, dairy, brewing
and pharmaceutical industries, for a purchase consideration of
GBP1.7m. This acquisition will form part of the Aerospace
cluster.
On 31 December 2015, the Group acquired the environmental
monitoring division of Resource and Environmental Consultants
Limited for a purchase consideration of GBP0.1m. This business will
be incorporated into our Health Sciences cluster.
Exova Metech, our calibration and metrology business also
completed four small acquisitions, two in Sweden and two in
Germany. This included the outsourcing of the in-house calibration
operation of Sartorius-Werkzeuge and the acquisition of the
Eisenhuth calibration businesses which increased our footprint in
Germany, part of our planned expansion into northern Europe.
On 15 February 2016, the Group acquired a majority stake in
Admaterials Technologies Pte Ltd (Admaterials), a Singapore based
business that provides testing in the construction sector, as well
as chemical, environmental and mechanical testing and certification
services. Founded in 2008, Admaterials is one of the leading
construction testing businesses in Singapore, as well as providing
chemical, environmental and mechanical testing to a range of
customers in the private and government sectors. The business has
annual revenues in the region of GBP3.5m, a team of more than 70
specialists and will form part of our Oil & Gas and Industrials
cluster.
External net debt (excluding debt issue costs)
2015 2014
GBPm GBPm
--------------------------- ------- -------
Term loans 169.7 173.5
Revolving credit
facility 12.0 -
Finance leases 0.4 0.5
--------------------------- ------- -------
Gross debt 182.1 174.0
Cash and cash equivalents (29.1) (29.9)
Net debt 153.0 144.1
--------------------------- ------- -------
Net debt has increased from GBP144.1m at 31 December 2014 to
GBP153.0m at 31 December 2015 mainly as a result of the
acquisitions made in the year.
At 31 December 2015, our term loans comprised GBP169.7m of
non-amortising borrowings denominated in sterling, euro, Canadian
dollars, US dollars and Swedish krona. The amounts drawn down on
the revolving credit facility are denominated in sterling. In
addition, a GBP78.0m revolving credit facility was undrawn at 31
December 2015. There are no repayments scheduled on our term loans
until 2019.
The net debt to last twelve months Adjusted EBITDA ratio was
2.6x as at 31 December 2015 (2014: 2.5x). Based on the definition
in the bank covenant, net debt to Adjusted EBITDA ratio is 2.4x
(2014: 2.4x).
Presentation of results
Constant currency growth figures are provided in order to remove
the impact of currency translation. We calculate growth at constant
rates by translating the current and prior period revenue at the
same exchange rates.
Organic growth at constant currency represents revenue growth at
constant currency excluding the growth attributable to acquisitions
until the acquisition has been owned for a 12 month period and
excluding the revenue attributable to disposals in the year of
disposal and the preceding year.
Adjusted results are stated before separately disclosed items,
2014 management fee to private equity investor, interest and
taxation.
The Group presents, as separately disclosed items on the face of
the income statement, those items of income and expense which,
because of their nature, merit separate presentation to allow users
to understand better the elements of financial performance in the
period to facilitate a comparison with prior periods and a better
assessment of trends in financial performance.
Foreign exchange
Exchange rates for the most significant currencies used by the
Group during the year were:
Average Closing Average Closing
rate rate rate rate
2015 2015 2014 2014
Euro 1.378 1.357 1.241 1.278
US dollar 1.532 1.483 1.652 1.553
Canadian dollar 1.957 2.056 1.823 1.807
Swedish krona 12.913 12.446 11.289 12.130
UAE dirham 5.630 5.447 6.068 5.707
Qatari riyal 5.585 5.404 6.019 5.662
------------------- -------- -------- -------- --------
OPERATING PERFORMANCE
(MORE TO FOLLOW) Dow Jones Newswires
March 03, 2016 02:01 ET (07:01 GMT)
Revenue
2015 Growth Organic
GBPm 2014 at reported growth
GBPm exchange at constant
rates exchange
rates
--------------- ------ ------- ------------- -------------
Europe 156.9 142.7 10.0% 1.2%
Americas 99.5 97.5 2.1% 2.0%
Rest of World 40.1 34.7 15.6% 7.2%
--------------- ------ ------- ------------- -------------
Group 296.5 274.9 7.9% 2.3%
--------------- ------ ------- ------------- -------------
2015 Growth Organic
GBPm 2014 at reported growth
GBPm exchange at constant
rates exchange
rates
--------------------------- ------ ------- ------------- -------------
Aerospace 46.0 44.9 2.4% 4.6%
Oil & Gas and
Industrials 69.1 80.3 (13.9)% (11.2)%
Product and Certification 95.2 74.2 28.3% 10.0%
Health Sciences 57.5 51.3 12.1% 5.8%
Middle East 28.7 24.2 18.6% 10.4%
--------------------------- ------ ------- ------------- -------------
Group 296.5 274.9 7.9% 2.3%
--------------------------- ------ ------- ------------- -------------
Adjusted EBITA
2015 Margin 2014 Margin
GBPm GBPm
--------------- ------ ------- ------ -------
Europe 21.1 13.5% 20.8 14.6%
Americas 20.7 20.8% 21.1 21.6%
Rest of World 4.9 12.3% 4.3 12.4%
--------------- ------ ------- ------ -------
Group 46.7 15.8% 46.2 16.8%
--------------- ------ ------- ------ -------
Regional Performance
Europe
2015 Growth
GBPm 2014 at reported Organic
GBPm exchange growth
rates at constant
exchange
rates
---------------- ------ ------- ------------- --------------
Revenue 156.9 142.7 10.0% 1.2%
Adjusted EBITA 21.1 20.8 1.4%
Margin 13.5% 14.6% (110)bps
---------------- ------ ------- ------------- --------------
Aerospace
Following a flat 2014, the European aerospace sector returned to
good organic growth in 2015. Growth was driven by strong
performances with the supply chains of OEMs supporting increased
build rates. There has been a shift in mix for the sector towards
production release testing. New material developments have helped
to maintain research and development volumes despite no completely
new airframe platforms being developed in Europe.
In the UK, continued investment in the latest technology enabled
the sector to continue to support the development programmes of the
European aerospace OEMs, work that looks set to grow further in
2016. The benefits of strong cost control and service delivery
contributed to a strong performance from our Non Destructive
Testing (NDT) business.
Oil & Gas and Industrials
The impact of low oil prices led to contraction and price
pressure in the oil & gas testing market. Despite a relatively
strong start to the year as a result of the completion of some 2014
projects, we experienced lower levels of new approved projects
later in the year.
During the year cost action was taken to mitigate volume and
price pressures in line with the market and we will continue to
monitor our cost base closely. Additionally, and as part of the
focus on diversification, we won a number of contracts with non-oil
& gas customers. In our Industrials sector, the Swedish
polymers business experienced a strong order book, driven by a
particularly good year for chlorine testing.
Product and Certification
Fire, Building Products and Certification had another successful
year across all European locations. Regulations and standards
helped support the positive testing and certification pipeline. The
acquisition of BM TRADA increased fire testing capacity as well as
extending the overall scope of building products testing and
certification. It also saw Exova enter into Management Systems and
Chain of Custody certification for the first time.
Our calibration business continued to perform very well. We
completed four small acquisitions - Eisenhuth, QA Viking, a
calibration laboratory in Kista, Stockholm and the outsourcing of
the in-house calibration operation of Sartorius-Werkzeuge, which
together added around GBP1m of revenue on an annualised basis. As a
result we have been able to extend our service range, consolidate
our market position in Sweden and improve our foothold in the
German market.
Health Sciences
Last year's strong organic growth continued in 2015 with further
major contract wins in the food business. This was through a
continued focus on food safety and integrity by both retail and
manufacturing clients as well as the commissioning of new
manufacturing operations and associated testing by a number of our
larger clients. Our water testing business in the UK continued to
perform well and, as a result, additional capacity was introduced
through the opening of a new laboratory in the south of England in
December. There was also continued growth in our pharmaceutical
business as a result of new contract wins.
Our environmental testing business continued to flourish with
the Catalyst stack emissions testing operation delivering strong
double-digit growth. As part of the region's strategy to expand and
develop its capability in environmental testing, this was further
enhanced through the acquisition in February of Environmental
Evaluation Limited (EEL). The stack emissions operations of EEL
were integrated into the Catalyst business, providing increased
capacity for growth across the UK. EEL's asbestos surveying
operation complemented our existing business in Scotland, creating
a UK-wide network for this capability.
Americas
2015 Growth
GBPm 2014 at reported Organic
GBPm exchange growth
rates at constant
exchange
rates
---------------- ------ ------- ------------- --------------
Revenue 99.5 97.5 2.1% 2.0%
Adjusted EBITA 20.7 21.1 (1.9%)
Margin 20.8% 21.6% (80)bps
---------------- ------ ------- ------------- --------------
Aerospace
Our Aerospace business continued to focus primarily on the
commercial aviation market, in addition to the defence and space
industries. We saw strong performance in 2015, driven by growth and
expansion in our laboratories in southern California and Mexico. We
continued to make investments in upgrading our capabilities and
capacity, and expanded our scope of accreditations in many
locations to better serve the needs of our customers. We are now
well positioned to capitalise on our investments in high-growth
areas such as fatigue testing and ceramic matrix composite (CMC)
testing, while continuing to support testing innovations in new
technically demanding service areas like additive manufacturing.
With a substantial backlog in airframe orders, we expect continued
growth in our Aerospace testing business.
Oil & Gas and Industrials
With the significant reduction in the oil price, the Gulf of
Mexico oil and gas market experienced a slowdown in new project
work. Additionally, the primary and secondary steel sectors have
been significantly impacted by price pressures and cheaper imports
affecting the regional markets, leading to an overall contraction
in the cluster. This was somewhat mitigated by better performance
in the general industrials market, both in the US and Canada. In
October we opened a new laboratory in Pittsburgh, Pennsylvania our
first facility in the north east of the USA, specialising in
materials and corrosion testing, supplemented by failure analysis
and risk assessment advisory services.
A combination of large projects, spill events, more regulatory
work and growth with certain oil and gas clients helped our Western
Canada business perform well in a difficult market.
Product and Certification
Revenue from our Transportation sector increased in 2015 due to
the continued strength of the US Automotive market. With an
increase in vehicle launches, both the Warren and Troy laboratories
in Michigan experienced growth. In Warren, growth was driven by
automotive interiors testing, with major programmes completed for
several Tier One Automotive customers. In addition, a major project
for durability of automotive axles in Warren contributed to a
strong finish to 2015. The Troy laboratory benefited from several
major structural durability projects for US Automotive OEMs and
Tier One suppliers.
Revenue from our engine-testing programmes increased
significantly due to high volumes of on-site testing work and a
two-year programme extension for another test site was won.
Health Sciences
(MORE TO FOLLOW) Dow Jones Newswires
March 03, 2016 02:01 ET (07:01 GMT)
Health Sciences contracted due to a weak performance in the
environment business that was impacted by severe weather conditions
in the first half, which resulted in a very late start to the
season and a very competitive market environment.
Several long-term agreements and continued strong demand for
specialised testing and development capabilities contributed to
growth in the Canadian and US pharmaceutical businesses, reaping
benefits from capital investments made to support these activities.
Investment in IT systems continues to help us provide an improved
customer service experience. Our food laboratory in Portland,
Oregon had a solid year with the addition of a new key account,
broadening the client base in a tight market.
Rest of World
2015 Growth
GBPm 2014 at reported Organic
GBPm exchange growth
rates at constant
exchange
rates
---------------- ------ ------- ------------- --------------
Revenue 40.1 34.7 15.6% 7.2%
Adjusted EBITA 4.9 4.3 14.0%
Margin 12.3% 12.4% (10)bps
---------------- ------ ------- ------------- --------------
Middle East
The market continued to grow strongly in the Middle East, driven
by continued major infrastructure spending in Saudi Arabia, Qatar
and Oman. Good revenues flowed from two Metro projects and
infrastructure programmes such as the 2022 World Cup in Qatar.
UAE/Oman: Government-funded projects in Oman delivered increased
demand for materials testing services and we also saw significant
growth in chemistry services in the UAE and Oman, generated by a
large water storage project and mineral characterisation work
respectively. While materials testing in Dubai grew, there was a
lower level of environmental-related project work, leading to an
overall contraction. The Abu Dhabi market remained relatively
flat.
Saudi Arabia/Qatar: Revenues from materials testing on civil
engineering projects in Saudi Arabia and Qatar increased
significantly year on year due to the award of new infrastructure
projects, such as the Metro projects in Riyadh and Doha, on which
we expect to have significant participation in the years ahead.
Oil & Gas and Industrials
We were able to grow our overall sales in the region through the
provision of our innovative, high-specification "laboratory in a
box" for Subsea 7 in support of its project work in offshore
Angola. Through increased investment in coatings testing, we have
ensured Exova Singapore is a 'one-stop-shop' for coatings tests
related to the oil & gas and marine coatings market.
Our Indian business, acquired in 2014, has been successfully
integrated into the region and recently completed the development
of a new state-of-the-art laboratory that will allow us to perform
better sour service-related corrosion testing. We experienced
headwinds in the oil & gas market and while these were less
severe than in other regions, we took the necessary cost actions in
the second half to mitigate their impact.
Product and Certification
In the Middle East, in our Fire business we saw a general
reduction in the overall number of large projects being tendered.
Australia Fire Consulting successfully extended its scope by adding
fire façade testing to its portfolio.
Outlook
The Board currently expects to deliver modest organic growth at
constant currency in 2016. This demonstrates the strength of our
portfolio and model. With deals completed in 2015 and a strong
pipeline going into 2016, we expect our M&A programme to
continue to contribute significantly to overall growth. As a result
of management actions taken in 2015 and the continued focus on our
cost base, we expect 2016 group margins to be broadly similar to
the prior year.
Our medium term revenue expectation remains mid-single digit
organic growth and additional continued expansion through
acquisitions with gradual margin improvement.
GROUP INCOME STATEMENT
For the year ended 31 December 2015
Before Separately Before Separately
separately disclosed separately disclosed
disclosed items disclosed items
items (note 2015 items 2014
3) Total Total
Continuing Notes GBPm GBPm GBPm GBPm GBPm GBPm
operations
------------------ ------ ------------ ----------- -------- ------------ ----------- --------
Revenue 2 296.5 - 296.5 274.9 - 274.9
Net operating
costs (249.8) (17.2) (267.0) (228.9) (26.4) (255.3)
------------------ ------ ------------ ----------- -------- ------------ ----------- --------
Operating profit 46.7 (17.2) 29.5 46.0 (26.4) 19.6
Finance costs 4 (6.3) - (6.3) (43.6) - (43.6)
Finance income 4 - - - 0.3 - 0.3
------------------ ------ ------------ ----------- -------- ------------ ----------- --------
Profit / (loss)
before taxation 40.4 (17.2) 23.2 2.7 (26.4) (23.7)
Income tax (8.5) 3.8 (4.7) (8.8) 3.8 (5.0)
------------------ ------ ------------ ----------- -------- ------------ ----------- --------
Profit / (loss)
for the year 31.9 (13.4) 18.5 (6.1) (22.6) (28.7)
Profit / (loss) attributable
to:
Equity holders
of the Parent 17.1 (29.9)
Non-controlling
interests 1.4 1.2
-------------------------- ------------ ----------- -------- ------------ ----------- --------
Profit / (loss)
for the year 18.5 (28.7)
-------------------------- ------------ ----------- -------- ------------ ----------- --------
Earnings per share *
Basic 5 6.8p (16.6)p
Diluted 5 6.8p (16.6)p
------------------ ------ ------------ --------------------- ------------ ---------------------
* Earnings per share on adjusted results are disclosed in Note
5.
GROUP STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 December 2015
2015 2014
GBPm GBPm
----------------------------------------------- ------ -------
Profit / (loss) for the year 18.5 (28.7)
Other comprehensive income to be reclassified
in profit or loss in subsequent periods
Exchange differences on translation
of foreign operations and related
borrowings (5.2) (2.9)
Other comprehensive income not to
be reclassified to profit or loss
in subsequent periods
Actuarial gain / (loss) on defined
benefit plans 1.2 (1.5)
Income tax effect (0.4) 0.4
Impact of rate change on deferred (0.3) -
tax
Other comprehensive income for the
year (net of tax) (4.7) (4.0)
------------------------------------------------ ------ -------
Total comprehensive income for the
year 13.8 (32.7)
------------------------------------------------ ------ -------
Total comprehensive income for the
year attributable to:
Equity holders of the Parent 12.3 (34.0)
Non-controlling interests 1.5 1.3
------------------------------------------------ ------ -------
Total comprehensive income for the
year 13.8 (32.7)
------------------------------------------------ ------ -------
GROUP BALANCE SHEET
As at 31 December 2015
2015 2014
Restated
Notes Note 1
GBPm GBPm
----------------------------------------------------- -------- -------- ----------
Assets
Non-current assets
Goodwill 355.1 335.4
Intangible assets 17.7 14.4
Property, plant and equipment 7 68.7 64.7
Government grants 7.1 8.8
Deferred tax assets 8.0 6.9
Investments in joint ventures 0.2 -
----------------------------------------------------- -------- -------- ----------
(MORE TO FOLLOW) Dow Jones Newswires
March 03, 2016 02:01 ET (07:01 GMT)
456.8 430.2
----------------------------------------------------- -------- -------- ----------
Current assets
Trade and other receivables 74.5 65.1
Income tax receivable 0.3 1.2
Cash and short-term deposits 29.2 29.9
----------------------------------------------------- -------- -------- ----------
104.0 96.2
----------------------------------------------------- -------- -------- ----------
Total assets 560.8 526.4
----------------------------------------------------- -------- -------- ----------
Equity
Issued share capital 2.5 2.5
Share premium 109.5 109.5
Merger reserve 324.5 324.5
Capital contribution reserve 114.9 114.9
Foreign currency translation reserve (5.4) (0.1)
Retained earnings (262.9) (273.4)
----------------------------------------------------- -------- -------- ----------
Equity attributable to equity holders of the Parent 283.1 277.9
Non-controlling interests 4.7 3.7
----------------------------------------------------- -------- -------- ----------
Total equity 287.8 281.6
----------------------------------------------------- -------- -------- ----------
Liabilities
Non-current liabilities
Bank and other borrowings 9 167.6 170.8
Finance leases 9 0.3 0.3
Retirement benefit obligations 15.8 3.1
Provisions 6.7 7.2
Deferred tax liabilities 10.4 10.4
Other liabilities 6.4 5.0
----------------------------------------------------- -------- -------- ----------
207.2 196.8
----------------------------------------------------- -------- -------- ----------
Current liabilities
Bank and other borrowings 9 12.1 -
Finance leases 9 0.1 0.2
Trade and other payables 50.5 44.5
Provisions 3.1 3.3
----------------------------------------------------- -------- -------- ----------
65.8 48.0
----------------------------------------------------- -------- -------- ----------
Total liabilities 273.0 244.8
----------------------------------------------------- -------- -------- ----------
Total equity and liabilities 560.8 526.4
----------------------------------------------------- -------- -------- ----------
GROUP STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2015
Attributable to equity holders of the Parent
Foreign
Capital currency Total
Share Share Merger contribution translation Retained shareholders' Non-controlling Total
capital premium reserve reserve reserve earnings equity interests equity
Notes GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm GBPm
---------------- ------ -------- -------- -------- ------------- ------------ --------- -------------- ---------------- --------
At 1 January
2014 4.4 - - 114.9 2.9 (244.1) (121.9) 2.9 (119.0)
(Loss)/profit
for the year - - - - - (29.9) (29.9) 1.2 (28.7)
Other
comprehensive
income - - - - (3.0) (1.1) (4.1) 0.1 (4.0)
---------------- ------ -------- -------- -------- ------------- ------------ --------- -------------- ---------------- --------
Total
comprehensive
income for the
year - - - - (3.0) (31.0) (34.0) 1.3 (32.7)
Share-based
payments - - - - - 1.4 1.4 - 1.4
Capitalisation
of
shareholder
loan 0.7 - 277.5 - - - 278.2 - 278.2
Conversion of
preference
share capital 34.2 - 9.9 - - - 44.1 - 44.1
Redemption of
deferred
share capital (37.3) - 37.1 - - 0.3 0.1 - 0.1
Issue of share
capital 0.5 109.5 - - - - 110.0 - 110.0
Dividends to
non-
controlling
interests - - - - - - - (0.5) (0.5)
At 31 December
2014 2.5 109.5 324.5 114.9 (0.1) (273.4) 277.9 3.7 281.6
---------------- ------ -------- -------- -------- ------------- ------------ --------- -------------- ---------------- --------
At 1 January
2015 2.5 109.5 324.5 114.9 (0.1) (273.4) 277.9 3.7 281.6
Profit for the
year - - - - - 17.1 17.1 1.4 18.5
Other
comprehensive
income - - - - (5.3) 0.5 (4.8) 0.1 (4.7)
---------------- ------ -------- -------- -------- ------------- ------------ --------- -------------- ---------------- --------
Total
comprehensive
income for the
year - - - - (5.3) 17.6 12.3 1.5 13.8
Share-based
payments - - - - - 0.4 0.4 - 0.4
Dividends 6 - - - - - (7.5) (7.5) (0.5) (8.0)
At 31 December
2015 2.5 109.5 324.5 114.9 (5.4) (262.9) 283.1 4.7 287.8
---------------- ------ -------- -------- -------- ------------- ------------ --------- -------------- ---------------- --------
GROUP STATEMENT OF CASH FLOWS
For the year ended 31 December 2015
2015 2014
Notes GBPm GBPm GBPm GBPm
-------------------------------------- ------ ------ ------- -------- -------
Profit / (loss) before taxation 23.2 (23.7)
Depreciation of property,
plant and equipment 12.4 11.2
Amortisation of intangible
assets 8.9 9.3
Gain on sale of property,
plant and equipment - (1.6)
Government grants (0.6) (1.0)
Share-based payments 0.4 1.4
Non-cash movement in defined
benefit pension obligations 0.5 0.2
Net finance costs 4 6.3 43.3
-------------------------------------- ------ ------ ------- -------- -------
Operating cash flows before
movements in working capital 51.1 39.1
Increase in trade and other
receivables (3.8) (4.5)
Decrease in provisions and
retirement benefit obligations (1.7) (0.8)
(Decrease) / increase in trade
and other payables (2.0) 0.3
-------------------------------------- ------ ------ ------- -------- -------
Movements in working capital (7.5) (5.0)
-------------------------------------- ------ ------ ------- -------- -------
Cash generated from operations 43.6 34.1
(MORE TO FOLLOW) Dow Jones Newswires
March 03, 2016 02:01 ET (07:01 GMT)
Interest paid (5.1) (29.5)
Tax paid (3.7) (7.3)
-------------------------------------- ------ ------ ------- -------- -------
Net cash flows from / (used
in) operating activities 34.8 (2.7)
-------------------------------------- ------ ------ ------- -------- -------
Investing activities
Purchase of property, plant
and equipment (15.7) (16.3)
Purchase of intangible assets (1.8) (0.9)
Acquisition of subsidiary
undertakings (net of cash
acquired) 8 (21.8) (11.4)
Proceeds from sale of property,
plant and equipment 0.2 2.4
Interest received - 0.3
-------------------------------------- ------ ------ ------- -------- -------
Net cash flows used in investing
activities (39.1) (25.9)
-------------------------------------- ------ ------ ------- -------- -------
Net cash flows before financing
activities (4.3) (28.6)
Financing activities
Proceeds from borrowings 17.0 170.0
Repayment of bank borrowings (5.0) (94.2)
Payment of finance lease liabilities (0.2) (0.1)
Dividends paid to shareholders 6 (7.5) -
Dividends paid to non-controlling
interests (0.5) (0.5)
Senior loan notes redemption - (155.0)
Repayment of other borrowings - (0.3)
Repayment of loans to minority
shareholders - (0.3)
IPO proceeds - 110.0
Debt issue costs paid - (3.4)
Net cash flows from financing
activities 3.8 26.2
-------------------------------------- ------ ------ ------- -------- -------
Net decrease in cash and cash
equivalents (0.5) (2.4)
Cash and cash equivalents
at 1 January 29.9 32.0
Effects of exchange rate changes (0.3) 0.3
-------------------------------------- ------ ------ ------- -------- -------
Cash and cash equivalents
at 31 December 29.1 29.9
-------------------------------------- ------ ------ ------- -------- -------
Separately disclosed items included
in cash flow from/(used in) operating
activities (8.3) (19.8)
------------------------------------------------------ ------- -------- -------
NOTES TO THE FULL YEAR RESULTS ANNOUNCEMENT
For the year ended 31 December 2015
1. BASIS OF PREPARATION AND CHANGES TO THE GROUP'S ACCOUNTING
POLICIES
The audited results for the year ended 31 December 2015 ("2015")
have been prepared in accordance with International Financial
Reporting Standards (IFRS) as adopted by the European Union and
applied in accordance with the provisions of the Companies Act
2006.
The financial information set out in the audited results does
not constitute the Group's statutory financial statements for the
year ended 31 December 2015 within the meaning of Section 434 of
the Companies Act 2006 and has been extracted from the full
financial statements for the year ended 31 December 2015.
Statutory financial statements for the year ended 31 December
2014, which received an unqualified audit report, have been
delivered to the Registrar of Companies. The reports of the
auditors on the financial statements for the year ended 31 December
2014 and for the year ended 31 December 2015 were unqualified and
did not contain a statement under either Section 498(2) or Section
498(3) of the Companies Act 2006. The financial statements for the
year ended 31 December 2015 will be delivered to the Registrar of
Companies and made available to all shareholders in due course.
Basis of consolidation
The consolidated financial statements comprise the financial
statements of the Group and its subsidiaries as at 31 December
2015. Control is achieved when the Group is exposed, or has rights,
to variable returns from its involvement with the investee and has
the ability to affect those returns through its power over the
investee. Specifically, the Group controls an investee if, and only
if, the Group has:
- power over the investee (i.e. existing rights that give it the
current ability to direct the relevant activities of the
investee);
- exposure, or rights, to variable returns from its involvement
with the investee; and
- the ability to use its power over the investee to affect its
returns.
Generally, there is a presumption that a majority of voting
rights result in control. To support this presumption and when the
Group has less than a majority of the voting or similar rights of
an investee, the Group considers all relevant facts and
circumstances in assessing whether it has power over an investee,
including:
- the contractual arrangement with the other vote holders of the
investee;
- rights arising from other contractual arrangements; and
- the Group's voting rights and potential voting rights.
The Group re-assesses whether or not it controls an investee if
facts and circumstances indicate that there are changes to one or
more of the three elements of control. Consolidation of a
subsidiary begins when the Group obtains control over the
subsidiary and ceases when the Group loses control of the
subsidiary. Assets, liabilities, income and expenses of a
subsidiary acquired or disposed of during the year are included in
the consolidated financial statements from the date the Group gains
control until the date the Group ceases to control the
subsidiary.
Restatement
During the year, the provisional fair values attributable to the
2014 acquisitions of Raufoss Offshore Limited and Metallurgical
Services Private Limited were finalised. In the balance sheet the
effect has been to increase goodwill by GBP0.6m and to reduce
intangible assets and deferred tax liabilities by GBP0.9m and
GBP0.3m respectively. Note 8 "Business combinations" provides
further details.
New standards, interpretations and amendments adopted by the
Group
The accounting policies adopted in the preparation of the
consolidated financial statements are consistent with those
followed in the preparation of the Group's annual consolidated
financial statements for the year ended 31 December 2014, except
for the adoption of a new accounting policy on joint ventures as
noted below.
The Group has not early adopted any other standard,
interpretation or amendment that has been issued but not yet
effective. There are no standards or interpretations effective for
the first time in the financial period with a significant impact on
the Group's consolidated results or financial position.
As a result of the acquisition of BM TRADA Group Limited, and
the joint venture companies within that group, the Group has
adopted the following accounting policy during the year:
Joint ventures
A joint venture is a type of joint arrangement whereby the
parties that have joint control of the arrangement have rights to
the net assets of the joint venture. Joint control is the
contractually agreed sharing of control of an arrangement, which
exists only when decisions about the relevant activities require
unanimous consent of the parties sharing control. The Group's
investments in joint ventures are accounted for using the equity
method.
Under the equity method, the investment in a joint venture is
initially recognised at cost. The carrying amount of the investment
is adjusted to recognise changes in the Group's share of net assets
of the joint venture since the acquisition date. Goodwill relating
to the joint venture is included in the carrying amount of the
investment and is not tested for impairment individually. The
income statement reflects the Group's share of the results of
operations of the joint venture. Any change in other comprehensive
income of those investees is presented as part of the Group's other
comprehensive income. In addition, when there has been a change
recognised directly in the equity of the joint venture, the Group
recognises its share of any changes, when applicable, in the
statement of changes in equity. Unrealised gains and losses
resulting from transactions between the Group and the joint venture
are eliminated to the extent of the interest in the joint venture.
The aggregate of the Group's share of profit or loss of a joint
venture is shown on the face of the income statement.
(MORE TO FOLLOW) Dow Jones Newswires
March 03, 2016 02:01 ET (07:01 GMT)
2. SEGMENTAL REPORTING
For management purposes, the Group is organised
into three operating regions: Europe, Americas and
Rest of World. These three regions are organised
and managed separately based on the geographies
served and each is treated as an operating segment
and a reportable segment in accordance with IFRS
8 Operating Segments. The operating and reportable
segments were determined based on reports reviewed
by the Directors which are used to make operational
decisions.
Management monitors the operating results of its
business units separately for the purpose of making
decisions about resource allocation and performance
assessment. Segment performance is evaluated based
on Adjusted EBITA and is measured consistently in
the consolidated financial statements. However,
group financing (including finance costs and finance
income), IPO related costs and income taxes are
managed centrally and are not allocated to operating
segments.
Transfer prices between operating segments are on
an arm's length basis in a manner similar to transactions
with third parties and inter-segment revenues are
eliminated on consolidation.
2015 Rest
of
Europe Americas World Eliminations Unallocated Total
GBPm GBPm GBPm GBPm GBPm GBPm
----------------------------- ------- --------- ------- ------------- ------------ -------
Operations
Revenue - external
customers 156.9 99.5 40.1 - - 296.5
Revenue - inter-business
segments 0.5 1.2 1.5 (3.2) - -
----------------------------- ------- --------- ------- ------------- ------------ -------
Total revenue 157.4 100.7 41.6 (3.2) - 296.5
----------------------------- ------- --------- ------- ------------- ------------ -------
Adjusted EBITDA 27.2 25.3 6.6 - - 59.1
Depreciation (6.1) (4.6) (1.7) - - (12.4)
----------------------------- ------- --------- ------- ------------- ------------ -------
Adjusted EBITA 21.1 20.7 4.9 - - 46.7
Amortisation of intangible
assets (4.9) (2.3) (1.7) - - (8.9)
Acquisition and integration
costs (2.9) (0.1) (0.4) - - (3.4)
Restructuring costs (3.1) (1.6) (0.2) - - (4.9)
Segmental operating
profit 10.2 16.7 2.6 - - 29.5
Net finance costs - - - - (6.3) (6.3)
----------------------------- ------- --------- ------- ------------- ------------ -------
Profit / (loss) before
tax 10.2 16.7 2.6 - (6.3) 23.2
Income tax - - - - (4.7) (4.7)
----------------------------- ------- --------- ------- ------------- ------------ -------
Profit / (loss) for
the year 10.2 16.7 2.6 - (11.0) 18.5
----------------------------- ------- --------- ------- ------------- ------------ -------
2014 Rest
of
Europe Americas World Eliminations Unallocated Total
GBPm GBPm GBPm GBPm GBPm GBPm
----------------------------- ------- --------- ------- ------------- ------------ -------
Operations
Revenue - external
customers 142.7 97.5 34.7 - - 274.9
Revenue - inter-business
segments 0.3 0.6 1.0 (1.9) - -
----------------------------- ------- --------- ------- ------------- ------------ -------
Total revenue 143.0 98.1 35.7 (1.9) - 274.9
----------------------------- ------- --------- ------- ------------- ------------ -------
Adjusted EBITDA 26.4 25.2 5.8 - - 57.4
Depreciation (5.6) (4.1) (1.5) - - (11.2)
----------------------------- ------- --------- ------- ------------- ------------ -------
Adjusted EBITA 20.8 21.1 4.3 - - 46.2
Management fee to
private equity investor (0.1) (0.1) - - - (0.2)
----------------------------- ------- --------- ------- ------------- ------------ -------
Operating profit
before separately
disclosed items 20.7 21.0 4.3 - - 46.0
Amortisation of intangible
assets (4.7) (2.6) (2.0) - - (9.3)
Acquisition and integration
costs (0.4) (0.5) (0.7) - - (1.6)
Restructuring costs (0.4) (1.6) (0.2) - - (2.2)
IPO related costs - - - - (13.3) (13.3)
----------------------------- ------- --------- ------- ------------- ------------ -------
Segmental operating
profit 15.2 16.3 1.4 - (13.3) 19.6
Net finance costs - - - - (43.3) (43.3)
----------------------------- ------- --------- ------- ------------- ------------ -------
Profit / (loss) before
tax 15.2 16.3 1.4 - (56.6) (23.7)
Income tax - - - - (5.0) (5.0)
----------------------------- ------- --------- ------- ------------- ------------ -------
Profit / (loss) for
the year 15.2 16.3 1.4 - (61.6) (28.7)
----------------------------- ------- --------- ------- ------------- ------------ -------
3. SEPARATELY DISCLOSED ITEMS
2015 2014
GBPm GBPm
----------------------------------- ------ ------
Amortisation of intangible assets 8.9 9.3
Restructuring costs 4.9 2.2
Acquisition and integration costs 3.4 1.6
IPO related costs - 13.3
----------------------------------- ------ ------
17.2 26.4
Income tax credit (3.8) (3.8)
13.4 22.6
----------------------------------- ------ ------
The Group presents, as separately disclosed items on the face of
the Group income statement, those items of income and expense
which, because of their nature, merit separate presentation to
allow users to understand better the elements of financial
performance in the year to facilitate a comparison with prior years
and a better assessment of trends in financial performance.
Included in the income tax credit is GBP2.0m (2014: GBP2.3m)
related to the amortisation of the deferred tax liability in
respect of customer relationships. The remaining income tax credit
of GBP1.8m (2014: GBP1.5m) relates to restructuring, amortisation
and integration costs.
4. NET FINANCE COSTS
2015 2014
GBPm GBPm
------------------------------------------ ----- ------
Finance costs:
Bank loans and senior loan notes 5.0 10.1
Other loans and charges 0.2 0.8
Amortisation of debt issue costs 0.7 0.5
Pension interest 0.4 0.1
Make whole on senior loan notes - 15.5
Loan due to parent undertaking - 8.1
Preference shares dividend - 1.0
Write-off of historical debt issue costs - 7.5
Total finance costs 6.3 43.6
------------------------------------------ ----- ------
Finance income:
Interest income on short-term deposits - (0.3)
------------------------------------------ ----- ------
Total finance income - (0.3)
------------------------------------------ ----- ------
Net finance costs 6.3 43.3
------------------------------------------ ----- ------
(MORE TO FOLLOW) Dow Jones Newswires
March 03, 2016 02:01 ET (07:01 GMT)
5. EARNINGS PER SHARE
2015 2014
Based on the profit for the year: Notes GBPm GBPm
---------------------------------------- --------- ------ -------
Profit / (loss) attributable to equity
holders of the Parent Company 17.1 (29.9)
Separately disclosed items 3 13.4 22.6
---------------------------------------- --------- ------ -------
Adjusted earnings after tax 30.5 (7.3)
--------------------------------------------------- ------ -------
2015 2014
Number of shares: m m
Basic weighted average number of ordinary
shares 250.4 179.9
Potentially dilutive share awards 0.3 -
--------------------------------------------------- ------ -------
Diluted weighted average number of shares 250.7 179.9
--------------------------------------------------- ------ -------
2015 2014
pence pence
--------------------------------------------------- ------ -------
Basic earnings per share 6.8 (16.6)
Share awards - -
--------------------------------------------------- ------ -------
Diluted earnings per share 6.8 (16.6)
--------------------------------------------------- ------ -------
Basic adjusted earnings per share 12.2 (4.1)
Share awards - -
--------------------------------------------------- ------ -------
Diluted adjusted earnings per share 12.2 (4.1)
--------------------------------------------------- ------ -------
Basic earnings per share (EPS) amounts are calculated
by dividing the profit for the year attributable to
the ordinary equity holders of the Parent Company by
the weighted average number of ordinary shares outstanding
during the year.
In the prior year, the dilutive effect of potential
ordinary shares through equity settled transactions
were considered to be anti-dilutive as they would have
decreased the loss per share from continuing operations
and were therefore excluded from the calculation of
diluted EPS.
6. DIVIDENDS
2015 2014
Dividends on ordinary shares GBPm GBPm
-------------------------------------- ------ ------
Interim paid in respect of 2015: 1.0p 2.5 -
per share
Final paid in respect of 2014: 2.0p 5.0 -
per share
-------------------------------------- ------ ------
7.5 -
---------------------------------------- ------ ------
Proposed dividends
The Board is recommending a final dividend of 2.2p per share
(2014: 2.0p per share). The dividend will be paid on 10 June 2016
to shareholders on the register at the close of business on 27 May
2016.
7. PROPERTY, PLANT AND EQUIPMENT
Acquisitions and disposals
During the year ended 31 December 2015, the Group capitalised
assets with a cost of GBP17.5m including GBP1.8m from business
combinations (note 8) (2014: GBP17.5m including GBP1.0m from
business combinations).
Assets with a carrying value of GBP0.1m were disposed of during
the year ended 31 December 2015 (2014: GBP0.9m).
The negative impact of foreign exchange on the total carrying
amount of property, plant and equipment in the year ended 31
December 2015 was GBP1.0m (2014: GBP0.2m negative impact).
The net book value of property, plant and equipment was as
follows:
2015 2014
GBPm GBPm
------------------------------------- ------ ------
Land and buildings 16.1 16.5
Plant and equipment 52.6 48.2
------------------------------------- ------ ------
Total property, plant and equipment 68.7 64.7
------------------------------------- ------ ------
Property, plant and equipment include GBP0.4m (2014: GBP0.5m) of
assets held under finance leases.
Capital commitments
At 31 December 2015 the Group had commitments to purchase
property, plant and equipment for GBP3.4m (2014: GBP2.2m).
8. BUSINESS COMBINATIONS
Acquisitions in 2015
During the year, the Group acquired the companies
below with fair values as set out in the following
table:
Western
Technical
Services
Environmental BM TRADA and Accusense
Evaluation Group Systems
Limited Limited Limited Others Total
GBPm GBPm GBPm GBPm GBPm
-------------------------- -------------- --------- --------------- ------- -------
Investments in
joint ventures - 0.2 - - 0.2
Intangible assets 1.7 8.6 0.2 - 10.5
Property, plant
and equipment 0.3 1.2 - 0.3 1.8
Deferred tax assets - 3.0 - - 3.0
Trade and other
receivables 0.7 5.5 0.3 0.1 6.6
Cash and cash equivalents 0.6 3.2 0.3 0.2 4.3
Trade and other
payables (0.7) (11.2) (0.2) (0.1) (12.2)
Income tax payable - (0.2) (0.2) - (0.4)
Long-term provisions - - - (0.1) (0.1)
Retirement benefit
obligations - (14.2) - - (14.2)
Deferred tax liabilities (0.4) (1.7) - - (2.1)
-------------------------- -------------- --------- --------------- ------- -------
Net assets acquired 2.2 (5.6) 0.4 0.4 (2.6)
Goodwill 3.2 19.9 1.3 1.2 25.6
Total purchase
price 5.4 14.3 1.7 1.6 23.0
Acquired cash and
cash equivalents (0.6) (3.2) (0.3) (0.2) (4.3)
Deferred consideration (0.1) (0.1) - (0.1) (0.3)
Contingent consideration - - (0.3) - (0.3)
-------------------------- -------------- --------- --------------- ------- -------
Net cash outflow
on acquisitions 4.7 11.0 1.1 1.3 18.1
-------------------------- -------------- --------- --------------- ------- -------
Purchase consideration:
Gross cash consideration
paid in the year 5.3 14.2 1.4 1.5 22.4
Deferred consideration 0.1 0.1 - 0.1 0.3
Contingent consideration - - 0.3 - 0.3
-------------------------- ---- ----- ---- ---- -----
5.4 14.3 1.7 1.6 23.0
-------------------------- ---- ----- ---- ---- -----
During the year the following payments were made for
acquisitions completed during the current and prior
year:
2015
GBPm
------------------------------------------ ------
Contingent consideration 3.5
Purchase price adjustment 0.2
------------------------------------------- ------
Net cash outflow on acquisitions made in
the prior year 3.7
Net cash outflow on acquisitions in the
current year 18.1
------------------------------------------- ------
Total net cash outflow for the year 21.8
------------------------------------------- ------
At year-end, the initial accounting for the acquisitions
made between 1 May 2015 and 31 December 2015 is not
complete due to the timing of the transactions. Therefore
the fair value amounts disclosed above are provisional
and may be subject to further adjustments following
the completion of the fair value assessment exercises.
No material adjustments have been made in respect
of the trade and other receivables acquired.
Goodwill
The goodwill of GBP25.6m comprises the fair value
of the expected synergies arising from the acquisitions
and the value of the human capital that does not meet
the criteria for recognition as a separable intangible
asset.
Contribution of acquisitions to revenue and profits
From the dates of acquisition the newly acquired subsidiaries
contributed GBP21.2m to revenue and, if the acquisitions
were assumed to have been made on 1 January 2015,
the Group revenue would have been GBP307.3m.
No profit figures are disclosed as these businesses
have now been integrated into the rest of the Group
and therefore it would be impracticable to obtain
a meaningful profit number.
Restatement (note 1)
(MORE TO FOLLOW) Dow Jones Newswires
March 03, 2016 02:01 ET (07:01 GMT)
Exova (LSE:EXO)
Historical Stock Chart
Von Jun 2024 bis Jul 2024
Exova (LSE:EXO)
Historical Stock Chart
Von Jul 2023 bis Jul 2024
