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| Share Name | Share Symbol | Market | Type | Share ISIN | Share Description |
|---|---|---|---|---|---|
| M&c Saatchi Plc | LSE:SAA | London | Ordinary Share | GB00B01F7T14 | ORD 1P |
| Price Change | % Change | Share Price | Bid Price | Offer Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
|---|---|---|---|---|---|---|---|---|---|---|
| 0.00 | 0.00% | 182.00 | 181.00 | 182.00 | 182.00 | 181.50 | 182.00 | 23,618 | 16:35:15 |
| Industry Sector | Turnover | Profit | EPS - Basic | PE Ratio | Market Cap |
|---|---|---|---|---|---|
| Advertising Agencies | 462.53M | 90k | 0.0007 | 2,592.86 | 221.9M |
From Apr 2019 to Apr 2024
TIDMSAA
RNS Number : 5203I
M&C Saatchi PLC
22 March 2018
M&C SAATCHI PLC
FINAL RESULTS
YEARED
31 DECEMBER 2017
22 March 2018
M&C Saatchi PLC - Preliminary Statement
Final Results for the year ended 31 December 2017
22 March 2018 Financial Highlights 2017 Growth versus 2016 Revenue GBP251.5m + 12% (2016: GBP225.4m) Revenue in constant GBP240.9m + 7% currencies Operating Profit GBP26.7m + 16% (2016: GBP23.0m) Profit Before GBP27.7m + 16% (2016: GBP23.7m) Tax Profit After Tax GBP18.0m + 17% (2016: GBP15.4m) and MI 23.04p + 9% (2016: 21.07p) EPS Full-Year Dividend 9.53p + 15% (2016: 8.29p)
The highlights are headline results, see note on next page for definition.
Operational Highlights
-- Record results in terms of both revenue and earnings -- The Global network performed well:
-- UK: revenues up 6%, with Sport & Entertainment, PR and Mobile continuing to perform particularly positively; operating profit was up 46% without last year's restructuring costs
-- Europe: revenues up 26%, operating profit increased 30% -- Middle East and Africa: revenues up 26%, operating profit up 45% -- Asia and Australia: revenues up 23%, operating profit up 37%
-- Americas: revenues were down 3% following a second half slowdown in New York advertising revenues, operating profit was down 53%. A major restructuring was undertaken, and the agency is profitable in Q1 2018
-- Final dividend increased 15% to 7.40p, full-year dividend up 15% to 9.53p
David Kershaw, Chief Executive, said:
"2017 was another record year for M&C Saatchi in terms of both revenue and earnings. Our established strategy of winning new business and starting new businesses continues to deliver.
This year has begun well, and we are confident that we will continue to make good progress in 2018 and beyond."
For further information please call:
M&C Saatchi +44 (0)20-7543-4500
David Kershaw
Tulchan Communications +44 (0)20-7353-4200
Andrew Grant
Tom Murray
Numis Securities +44 (0)20-7260-1000
Nick Westlake, NOMAD
Charles Farquhar, Corporate Broking
Notes to Editors
Headline results
The term headline is not a defined term in IFRS. The items that are excluded from headline results are the amortisation or impairment of intangible assets (including goodwill and acquired intangibles, but excluding software) acquired in business combinations, changes to deferred and contingent consideration and other acquisition related charges taken to the income statement; impairment of investment in associates; profit/loss on disposal of associates; and income statement impact of put option accounting (whether accounted under IFRS2 or IAS39). See note 3 for reconciliation between the Group's statutory results and the headline results.
SUMMARY OF RESULTS
2017 saw record results in terms of both revenue and earnings. Revenues grew by 12%, with constant currency revenues increasing 7%. Excluding the costs of businesses started in the year, we returned a headline operating margin of 11.3%, up from 10.2% in 2016. The headline profit before tax advanced 16% to GBP27.7m and headline net earnings also rose 17%. Statutory profit before tax was up 37% from GBP6.8m to GBP9.3m.
Our competitive advantages continue to deliver market-beating growth. We have an entrepreneurial culture and ownership structure that motivates our people to deliver exceptional performance. We have a genuine integrated offering that delivers greater effectiveness and efficiency to our clients. We are not dependent upon multinational packaged goods clients, media buying or M&A. We are of a scale and nimbleness where the birth, growth and success of our businesses can mitigate against macro headwinds. Lastly, we start companies with the best talent in attractive geographies and in new growth channels, with 16 new businesses started in 2017.
UK
Revenue in the UK was up 6%, with Sport & Entertainment, PR and Mobile continuing to trade particularly positively. New business wins included Dreams, Visit Britain, Little Dish, Lipton, The Body Shop, Costa Coffee and Clinique.
M&C Saatchi Sport & Entertainment won Large Sponsorship Consultancy of the year, M&C Saatchi PR was awarded Mid-sized PR Agency of the year and M&C Saatchi Mobile won Most Effective Mobile Agency.
Our London advertising agency management team is now complete, incentivised with shares and building good new business momentum.
M&C Saatchi Merlin, our talent management agency, launched a social influencer division in May which has very positive growth potential. We started Re, our successful Australian brand identity unit, in the UK in June.
The UK headline operating profit was up 46% on 2016 without last year's one-off restructuring costs in the London advertising agency. The headline operating margin also benefited from this, increasing to 16.1% compared with 2016's 11.7%. These margins exclude the impact of Group recharges.
Europe
European revenues increased 26% year on year. Headline operating profit was up 30%, with a headline operating margin of 15.3% (2016: 15.1%).
The Stockholm office maintained its dynamic new business performance, winning the property company AMFF, the engineering client PE Consulting and the political party Centerpartiet.
Both Germany and Italy continue to excel. Mobile opened in Berlin whilst Italy was appointed by Sisal, a gaming company, in addition to being reappointed by Unicredit.
France remains challenging but in the second half the Paris office won projects from Casino Supermarkets, the sugar free children's fruit snacks provider Charles & Alice and Bonduelle, the processed vegetable producer.
The Madrid office is much improved, and we started a sponsorship operation there in April.
Middle East and Africa
Revenues in the Middle East and Africa were up 26%.
South Africa converted Windhoek, Heineken Export and the South African Reserve Bank. In January 2018, they picked up Lexus and the second-hand car retailer Automark. We also acquired Johannesburg based sport and entertainment company Levergy.
UAE won the accounts of Aldar Properties, UAE Banks Federation and Unilever's Lipton account. M&C Saatchi PR opened in the UAE and won the Abu Dhabi Motors Rolls Royce account.
Operating profit in the region was up 45% and the headline operating margin increased to 10.7% from 9.3% in 2016.
Asia and Australia
In Asia and Australia, revenues were up 23% year on year.
Australia performed well, benefiting from a full-year of Woolworths. They won some projects from Pfizer, Prudential and Jack Daniels, although one significant account in the year was lost, IAG. In February 2017, we acquired 51% of Bohemia, a media buying and planning operation. This wider offer is
important in this market, where clients are increasingly looking for a tighter relationship between the creative providers and media buying and planning. In March, we launched The Source, our successful UK research operation, in Melbourne.
We opened a new office in Jakarta in January 2018.
The headline regional operating margin was 11.4% (2016: 11.0%), with the headline operating profit ahead 37% on 2016.
Americas
Revenues decreased 3% and headline operating profit was down 53% with a headline operating margin of 7.4% (2016: 15.5%).
Our Mobile operations continue to perform well and are building a potent network across the US.
There was a drag in New York with a slowdown in advertising revenues, which dented the overall region's performance. SS+K 's political and charitable project revenues were particularly hard hit in the second half. A major restructuring was undertaken, and the agency is profitable in the first quarter of 2018. LIDA New York opened for business and was appointed by Aston Martin.
Our Los Angeles office had a better year and was appointed by Pacific Life. We unveiled both Clear and Sport & Entertainment there in the first half and our Mexico City office opened its doors in September. This year we launched Majority in Los Angeles, a production company with an initially all-women Director roster.
Outlook
2017 was another record year for M&C Saatchi in terms of both revenue and headline earnings. Our established strategy of winning new business and starting new businesses continues to deliver.
This year has begun well, and we are confident that we will continue to make good progress in 2018 and beyond.
Consolidated income statement
Hot Features
Premium
2017 2016
Year ended 31 December Note GBP000 GBP000
------------------------------------------ ------ ---------- ----------
Billings 535,964 458,180
-------------------------------------------------- ---------- ----------
Revenue 251,481 225,387
Operating costs (246,146) (218,738)
-------------------------------------------------- ---------- ----------
Operating profit 5,335 6,649
-------------------------------------------------- ---------- ----------
Share of results of associates and joint
ventures 1,987 1,530
Finance income 3,326 440
Finance costs (1,346) (1,828)
-------------------------------------------------- ---------- ----------
Profit before taxation 9,302 6,791
-------------------------------------------------- ---------- ----------
Taxation (4,736) (3,451)
-------------------------------------------------- ---------- ---------- Profit for the year 4,566 3,340 -------------------------------------------------- ---------- ---------- Attributable to: Equity shareholders of the Group 2,672 144 Non-controlling interests 1,894 3,196 -------------------------------------------------- ---------- ---------- Profit for the year 4,566 3,340 -------------------------------------------------- ---------- ---------- Earnings per share Basic (pence) 3.43p 0.20p Diluted (pence) 3.31p 0.19p -------------------------------------------------- ---------- ---------- Headline results* ------------------------------------------ ------ ---------- ---------- Operating profit 26,725 23,037 Profit before tax 27,655 23,776 Profit after tax attributable to equity shareholders of the Group 17,971 15,423 Basic earnings per share (pence) 23.04p 21.07p Diluted earnings per share (pence) 21.22p 20.55p -------------------------------------------------- ---------- ----------
* The reconciliation of headline to statutory results above can be found in note 3.
The notes on pages 13 to 22 form part of these preliminary statements.
CONSOLIDATED STATEMENT OF other COMPREHENSIVE INCOME
2017 2016
Year ended 31 December GBP000 GBP000
-------------------------------------------- ------- -------
Profit for the year 4,566 3,340
-------------------------------------------- ------- -------
Other comprehensive income*
Exchange differences on translating foreign
operations before tax (1,177) 6,754
-------------------------------------------- ------- -------
Other comprehensive income for the year
net of tax (1,177) 6,754
Total comprehensive income for the year 3,389 10,094
-------------------------------------------- ------- -------
Total comprehensive income attributable
to:
Equity shareholders of the Group 1,495 6,898
Non-controlling interests 1,894 3,196
Total comprehensive income for the year 3,389 10,094
-------------------------------------------- ------- -------
* All items in consolidated statement of comprehensive income will be reclassified to the income statement.
The notes on pages 13 to 22 form part of these preliminary statements.
CONSOLIDATED balance sheet
2017 2016
At 31 December GBP000 GBP000
-------------------------------------------- --------- ---------
Non-current assets
Intangible assets 48,515 51,004
Investments in associates 19,725 19,277
Plant and equipment 12,269 10,619
Deferred tax assets 4,797 3,112
Other non-current assets 9,325 7,455
--------------------------------------------- --------- ---------
94,631 91,467
-------------------------------------------- --------- ---------
Current assets
Trade and other receivables 120,096 109,824
Current tax assets 945 1,057
Cash and cash equivalents 48,957 32,222
--------------------------------------------- --------- ---------
169,998 143,103
-------------------------------------------- --------- ---------
Current liabilities
Trade and other payables (128,256) (115,886)
Current tax liabilities (1,221) (1,186)
Borrowings (3,731) (3,670)
Deferred and contingent consideration (377) -
Minority shareholder put option liabilities (14,813) (20,216)
--------------------------------------------- --------- ---------
(148,398) (140,958)
-------------------------------------------- --------- ---------
Net current assets 21,600 2,145
--------------------------------------------- --------- ---------
Total assets less current liabilities 116,231 93,612
--------------------------------------------- --------- ---------
Non-current liabilities
Deferred tax liabilities (761) (380)
Borrowings (37,764) (28,277)
Contingent consideration (833) -
Minority shareholder put option liabilities (10,316) (12,950)
Other non-current liabilities (2,487) (2,608)
--------------------------------------------- --------- ---------
(52,161) (44,215)
-------------------------------------------- --------- ---------
Total net assets 64,070 49,397
--------------------------------------------- --------- ---------
2017 2016
At 31 December GBP000 GBP000
-------------------------------------- --------- ---------
Equity
Share capital 813 749
Share premium 32,095 24,099
Merger reserve 31,592 31,592
Treasury reserve (792) (792)
Minority interest put option reserve (13,958) (20,598)
Non-controlling interest acquired (21,040) (13,122)
Foreign exchange reserve 3,593 4,770
Retained earnings 25,235 15,871
--------------------------------------- --------- ---------
Equity attributable to shareholders
of the Group 57,538 42,569
--------------------------------------- --------- ---------
Non-controlling interest 6,532 6,828
--------------------------------------- --------- ---------
Total equity 64,070 49,397
--------------------------------------- --------- ---------
The notes on pages 13 to 22 form part of these preliminary statements.
CONSOLIDATED STATEMENT OF changes in equity
MI put Non-controlling Foreign Non-controlling
Share Share Merger Treasury option interest exchange Retained interest
capital premium reserve reserve reserve acquired reserves earnings Subtotal in equity Total
GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
--------------- ---- -------- -------- -------- --------- --------- ---------------- --------- --------- --------- ---------------- --------
At 1 January
2016 727 17,338 31,592 (792) (12,595) (9,233) (1,984) 12,673 37,726 4,295 42,021
Acquisitions - - - - (10,249) - - - (10,249) 1,919 (8,330)
Acquisitions
of minority
interest 4 1,364 - - - (1,222) - - 146 - 146
Exercise of
put options 18 5,397 - - 2,366 (2,366) - - 5,415 (47) 5,368
Disposals - - - - - - - - - (10) (10)
Exchange rate
movements - - - - (120) (301) - - (421) 627 206
Issue of shares
to minorities - - - - - - - - - 14 14
Issue of options - - - - - - - 515 515 - 515
Share option
charge - - - - - - - 7,997 7,997 - 7,997
Dividends - - - - - - - (5,458) (5,458) (3,166) (8,624)
--------------------- -------- -------- -------- --------- --------- ---------------- --------- --------- --------- ---------------- --------
Total transactions
with owners 22 6,761 - - (8,003) (3,889) - 3,054 (2,055) (663) (2,718)
Total comprehensive
income
for the year - - - - - - 6,754 144 6,898 3,196 10,094
--------------------- -------- -------- -------- --------- --------- ---------------- --------- --------- --------- ---------------- --------
At 31 December
2016 749 24,099 31,592 (792) (20,598) (13,122) 4,770 15,871 42,569 6,828 49,397 --------------------- -------- -------- -------- --------- --------- ---------------- --------- --------- --------- ---------------- -------- Acquisitions 4 1,498 - - - - - - 1,502 235 1,737 Acquisitions of minority interest 5 1,587 - - - (1,390) - - 202 310 512 Exercise of put options 55 4,911 - - 6,640 (6,640) - (61) 4,905 - 4,905 Exchange rate movements - - - - - 112 - - 112 (252) (140) Share option charge - - - - - - - 13,501 13,501 - 13,501 Dividends - - - - - - - (6,748) (6,748) (2,483) (9,231) --------------------- -------- -------- -------- --------- --------- ---------------- --------- --------- --------- ---------------- -------- Total transactions with owners 64 7,996 - - 6,640 (7,918) - 6,692 13,474 (2,190) 11,284 Total comprehensive income for the year - - - - - - (1,177) 2,672 1,495 1,894 3,389 ---------------- --- -------- -------- -------- --------- --------- ---------------- --------- --------- --------- ---------------- -------- At 31 December 2017 813 32,095 31,592 (792) (13,958) (21,040) 3,593 25,235 57,538 6,532 64,070 --------------------- -------- -------- -------- --------- --------- ---------------- --------- --------- --------- ---------------- --------
The notes on pages 13 to 22 form part of these preliminary statements.
CONSOLIDATED CASH FLOW
2017 2016
Year ended 31 December GBP000 GBP000
----------------------------------------- ---------- ----------
Revenue 251,481 225,387
Operating expenses (246,146) (218,738)
------------------------------------------ ---------- ----------
Operating profit 5,335 6,649
------------------------------------------ ---------- ----------
Adjustments for:
Depreciation of plant and equipment 3,079 2,668
Loss on sale of plant and equipment 57 542
Loss on sale of software intangibles 4 10
Fair value revaluation of associate
on step acquisition - 859
Impairment and amortisation of
acquired intangible assets 2,021 2,324
Impairment of associate and investments - 4,389
Impairment of goodwill 5,214 -
Amortisation of capitalised software
intangible assets 211 354
Equity settled share based payment
expenses 13,501 7,997
------------------------------------------ ---------- ----------
Operating cash before movements
in working capital 29,422 25,792
------------------------------------------ ---------- ----------
Increase in trade and other receivables (10,806) (22,334)
increases in trade and other payables 11,665 19,342
------------------------------------------ ---------- ----------
Cash generated from operations 30,281 22,800
Tax paid (6,727) (4,073)
------------------------------------------ ---------- ----------
Net cash from operating activities 23,554 18,727
------------------------------------------ ---------- ----------
Investing activities
Acquisitions of subsidiaries net
of cash acquired (951) (12,822)
Disposal of subsidiaries net of
cash divested - (263)
Acquisitions of investments (2,024) (1,056)
Proceeds from sale of plant and
equipment 77 32
Purchase of plant and equipment (3,451) (3,873)
Purchase of capitalised software (385) (34)
Dividends received from associates 1,806 177
Interest received 288 440
------------------------------------------ ---------- ----------
Net cash consumed investing activities (4,640) (17,399)
------------------------------------------ ---------- ----------
Net cash from operating and investing
activities 18,914 1,328
------------------------------------------ ---------- ----------
The notes on pages 13 to 22 form part of these preliminary statements.
2017 2016
Year ended 31 December GBP000 GBP000
-------------------------------------- --------- ---------
Net cash from operating and
investing activities 18,914 1,328
--------------------------------------- --------- ---------
Financing activities
Dividends paid to equity holders
of the Company (6,748) (5,458)
Dividends paid to non-controlling
interest (2,484) (3,166)
Issue of shares to minorities - 514
Repayment of finance leases (28) (36)
Inception of invoice discounting - 4,455
Repayment of invoice discounting (730) (3,943)
Inception of bank loans 10,240 11,433
Repayment of bank loans (359) (7,191)
Interest paid (1,275) (1,230)
--------------------------------------- --------- ---------
Net cash consumed by financing
activities (1,384) (4,622)
--------------------------------------- --------- ---------
Net (decrease)/increase in
cash and cash equivalents 17,530 (3,294)
--------------------------------------- --------- ---------
Effect of exchange rate fluctuations
on cash held (795) 3,270
Cash and cash equivalents
at the beginning of the year 32,222 32,246
--------------------------------------- --------- ---------
Cash and cash equivalents
at the end of the year 48,957 32,222
--------------------------------------- --------- ---------
Bank loans and borrowings* (38,675) (28,582)
--------------------------------------- --------- ---------
Net cash 10,282 3,640
--------------------------------------- --------- ---------
* Bank loans and borrowings excludes GBP2,915k (2016: GBP3,645k) of invoice discounting.
The notes on pages 13 to 22 form part of these preliminary statements.
Notes to the preliminary statements
Year ended 31 December 2017
1. GENERAL INFORMATION
The Company is a public limited company incorporated and domiciled in the UK. The address of its registered office is 36 Golden Square, London W1F 9EE.
The Company is listed on the AIM market of the London Stock Exchange.
These 2017 preliminary statements were approved for issue on 21 March 2018.
The financial information set out below does not constitute the company's statutory accounts for 2016 or 2017. Statutory accounts for the years ended 31 December 2016 and 31 December 2017 have been reported on by the Independent Auditors. The Independent Auditors' Reports on the Annual Report and Financial Statements for 2016 and 2017 were unqualified, did not draw attention to any matters by way of emphasis, and did not contain a statement under 498(2) or 498(3) of the Companies Act 2006.
Statutory accounts for the year ended 31 December 2016 have been filed with the Registrar of Companies. The statutory accounts for the year ended 31 December 2017 will be delivered to the Registrar in due course.
Headline results
The Directors believe that the headline results and headline earnings per share provide additional useful information on the underlying performance of the business. The headline result is used for internal performance management, calculating the value of subsidiary convertible shares and minority interest put options. The term headline is not a defined term in IFRS. Note 3 reconciles reported to headline results.
Our segmental reporting (note 4) reflects our headline results in accordance with IFRS 8.
The items that are excluded from headline results are the amortisation or impairment of intangible assets (including goodwill and acquired intangibles, but excluding software) acquired in business combinations, changes to deferred and contingent consideration and other acquisition related charges taken to the income statement; impairment of investment in associates and investments; profit and loss on disposal of associates; and the income statement impact of put option accounting and share based payment charges. See note 3 for a reconciliation between the Group's statutory results and the headline results.
Notes to the preliminary statements
Continued
2. ACCOUNTING POLICIES
The financial information set out in these final results has been prepared using the recognition and measurement principles of International Accounting Standards, International Financial Reporting Standards and Interpretations adopted for use in the European Union (collectively Adopted IFRSs). The accounting policies adopted in these final results have been consistently applied to all the years presented and are consistent with the policies used in the preparation of the statutory accounts for the period ended 31 December 2017. The principal accounting policies adopted are unchanged from those used in the preparation of the statutory accounts for the period ended 31 December 2016.
Notes to the preliminary statements
Continued
3. Headline results and earnings per share
The analysis below provides a reconciliation between the Group's statutory results and the headline results.
Deferred Deferred
tax tax
on on
acquired put
intangible options
Amortisation Impairment US US Revaluation
of of tax tax of Acquisition Put
Year ended acquired acquired rate rate contingent related option Headline
31 December 2017 intangibles intangibles change change consideration Remuneration* Accounting** results
2017 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
Billings 535,964 - - - - - - - 535,964
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
Revenue 251,481 - - - - - - - 251,481
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
Operating profit 5,335 2,021 5,214 - - 40 614 13,501 26,725
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
Share of results
of associates
and JV 1,987 - - - - - - - 1,987
Finance income 3,326 - - - - - - (3,037) 289
Finance cost (1,346) - - - - - - - (1,346)
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
Profit before
taxation 9,302 2,021 5,214 - - 40 614 10,464 27,655
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
Taxation (4,736) (671) (1,804) 981 392 - - (996) (6,834)
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
Profit for
the year 4,566 1,350 3,410 981 392 40 614 9,468 20,821
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
Non-controlling
interests (1,894) (365) - - - - (591) - (2,850)
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
Profit
attributable
to equity
holders
of the Group*** 2,672 985 3,410 981 392 40 23 9,468 17,971
----------------- -------- ------------- ------------ ----------- --------- -------------- -------------- ------------- ---------
* The non-controlling interest charge is moved to operating profit due to underlying equity being defined as a conditional share award.
** These values represent put options accounted for as conditional share awards (GBP13,501k) and fair value adjustments to minority put option liabilities (GBP3,037k).
*** Headline earnings are profit attributable to equity holders of the Group after adding back the adjustments noted above. The increase is calculated as the difference between 2016 and 2017 measures. Headline operating margin is calculated as: Headline operating profit divided by revenue. Headline operating margin excluding new businesses is calculated as: Headline operating profit after adding back the cost of businesses started divided by revenue. This cost of business started during the year has been calculated as GBP1.6m (2016: GBP0.1m).
Notes to the preliminary statements
Continued
3. Headline results and earnings per share continued
Revaluation
of an
Amortisation Impairment Provision associate Acquisition Put
Year ended of acquired of against on related option Headline
31 December 2016 intangibles associate investments acquisition remuneration accounting results
2016 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Billings 458,180 - - - - - 458,180
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Revenue 225,387 - - - - - 225,387
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Operating
profit 6,649 2,324 3,738 651 859 819 7,997 23,037
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Share of
results
of associates
and JV 1,530 - - - - - - 1,530
Finance
income 440 - - - - - - 440
Finance
cost (1,828) - - - - - 597 (1,231)
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Profit
before
taxation 6,791 2,324 3,738 651 859 819 8,594 23,776
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Taxation (3,451) (659) - - - - (4,110)
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Profit
for the
year 3,340 1,665 3,738 651 859 819 8,594 19,666
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Non-controlling
interests (3,196) (256) - - - (540) (251) (4,243)
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Profit
attributable
to equity
holders
of the
Group 144 1,409 3,738 651 859 279 8,343 15,423
----------------- -------- ------------- ----------- ------------ ------------ ------------- ----------- ---------
Notes to the preliminary statements
Continued
3. Headline results and earnings per share continued
Basic and diluted earnings per share are calculated by dividing profit attributable to equity holders of the Group by the weighted average number of shares in issue during the year.
Headline
2017 2017
Year ended 31 December 2017 GBP000 GBP000
----------------------------------------------- -------- ---------
Profit attributable to equity shareholders
of the Group 2,672 17,971
----------------------------------------------- -------- ---------
Basic earnings per share
----------------------------------------------- -------- ---------
Weighted average number of shares (thousands) 77,999 77,999
----------------------------------------------- -------- ---------
Basic EPS 3.43p 23.04p
----------------------------------------------- -------- ---------
Diluted earnings per share*
----------------------------------------------- -------- ---------
Weighted average number of shares (thousands)
as above 77,999 77,999
Add
- Conditional shares without dividend rights 2,763 2,763
- Conditional shares with dividend rights** 3,829 3,829
- Contingent consideration 108 108
Total 84,699 84,699
----------------------------------------------- -------- ---------
Diluted earnings per share 3.16p 21.22p
----------------------------------------------- -------- ---------
* All the minority interest put options are non-dilutive as the exercise price approximates fair value of the underlying non-controlling interest.
** Conditional share with dividend rights are excluded from any calculation of conditional share awards that uses diluted EPS growth as a measure.
Headline
2016 2016
Year ended 31 December 2016 GBP000 GBP000
----------------------------------------------- --------- ---------
Profit attributable to equity shareholders
of the Group 144 15,423
----------------------------------------------- --------- ---------
Basic earnings per share
----------------------------------------------- --------- ---------
Weighted average number of shares (thousands) 73,193 73,193
----------------------------------------------- --------- ---------
Basic EPS 0.20p 21.07p
----------------------------------------------- --------- ---------
Diluted earnings per share*
----------------------------------------------- --------- ---------
Weighted average number of shares (thousands)
as above 73,193 73,193
Add
- Conditional shares 1,867 1,867
Total 75,060 75,060
----------------------------------------------- --------- ---------
Diluted earnings per share 0.19p 20.55p
----------------------------------------------- --------- ---------
* All the minority interest put options are non-dilutive as the exercise price approximates fair value of the underlying non-controlling interest.
Notes to the preliminary statements
Continued
4. Segmental information
Segmental and headline income statement 2017
Middle
East Asia
and and
Year ended 31 UK Europe Africa Australia Americas Total
December 2017 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
------------------------ ------- ---------- ------------ ---------- -------------- -------
Billings 169,299 59,037 27,207 132,007 148,414 535,964
------------------------ ------- ---------- ------------ ---------- -------------- -------
Revenue 94,013 33,492 14,650 64,703 44,623 251,481
------------------------ ------- ---------- ------------ ---------- -------------- -------
Operating profit
excluding Group
costs 15,149 5,187 1,568 7,733 3,385 33,022
------------------------ ------- ---------- ------------ ---------- -------------- -------
Group costs (5,821) (71) - (339) (66) (6,297)
------------------------ ------- ---------- ------------ ---------- -------------- -------
Operating profit 9,328 5,116 1,568 7,394 3,319 26,725
------------------------ ------- ---------- ------------ ---------- -------------- -------
Share of results
of associates
and JV 1,633 3 - 351 - 1,987
Financial income
and cost (437) (69) 11 48 (610) (1,057)
------------------------ ------- ---------- ------------ ---------- -------------- -------
Profit before
taxation 10,524 5,050 1,579 7,793 2,709 27,655
------------------------ ------- ---------- ------------ ---------- -------------- -------
Taxation (1,478) (1,604) (421) (2,110) (1,221) (6,834)
------------------------ ------- ---------- ------------ ---------- -------------- -------
Profit for the
year 9,046 3,446 1,158 5,683 1,488 20,821
Non-controlling
interests (813) (721) (534) (1,189) 407 (2,850)
------------------------ ------- ---------- ------------ ---------- -------------- -------
Profit attributable
to equity shareholders
of the Group 8,233 2,725 624 4,494 1,895 17,971
------------------------ ------- ---------- ------------ ---------- -------------- -------
Headline basic
EPS 23.04p
------------------------ ------- ---------- ------------ ---------- -------------- -------
Non-cash costs
included in headline
operating profit:
------------------------ ------- ---------- ------------ ---------- -------------- -------
Depreciation 1,386 357 371 576 389 3,079
Amortisation of
software 70 37 11 93 - 211
Office locations London Paris Johannesburg Sydney New York
Milan Cape Melbourne Chicago
Berlin Town New Delhi Los Angeles
Madrid Abu Dhabi Bangalore San Francisco
Geneva Dubai Islamabad Mexico
Stockholm Beirut Hong City
Moscow Tel Aviv Kong São
Istanbul Shanghai Paulo
Tokyo
Kuala
Lumpur
Bangkok
Singapore
------------------------ ------- ---------- ------------ ---------- -------------- -------
Segmental results are reconciled to the income statement in note 3. Our segmental and headline results are one and the same. The above segments reflect the fact that our business is run on an operating unit basis. In accordance with IFRS 8 paragraph 12, we have aggregated our operating units into regional segments.
Notes to the preliminary statements
Continued
4. Segmental information continued
Segmental and headline income statement 2016
Middle
East Asia
and and
Year ended 31 December UK Europe Africa Australia Americas Total
2016 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Billings 154,844 38,504 22,810 88,665 153,357 458,180
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Revenue 88,504 26,685 11,673 52,531 45,994 225,387
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Operating profit excluding
Group costs 10,398 4,028 1,085 5,754 7,119 28,384
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Group costs (4,879) (87) - (343) (38) (5,347)
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Operating profit 5,519 3,941 1,085 5,411 7,081 23,037
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Share of results of
associates and JV 1,323 (3) - 290 (80) 1,530
Financial income and
cost (343) (43) 43 124 (572) (791)
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Profit before taxation 6,499 3,895 1,128 5,825 6,429 23,776
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Taxation (811) (1,350) (362) (1,458) (129) (4,110)
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Profit for the year 5,688 2,545 766 4,367 6,300 19,666
Non-controlling interests (1,320) (494) (326) (844) (1,259) (4,243)
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Profit attributable
to equity shareholders
of the Group 4,368 2,051 440 3,523 5,041 15,423
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Headline basic EPS 21.07p
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Non-cash costs included
in headline operating
profit:
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Depreciation (1,364) (242) (185) (329) (548) (2,668)
Amortisation of software (268) (62) (9) (13) (2) (354)
Office locations London Paris Johannesburg Sydney New
Milan Cape Melbourne York
Berlin Town New Chicago
Madrid Abu Delhi Los
Geneva Dhabi Bangalore Angeles
Stockholm Dubai Islamabad San
Moscow Beirut Hong Francisco
Istanbul Tel Kong São
Aviv Shanghai Paulo
Tokyo
Kuala
Lumpur
Bangkok
Singapore
---------------------------- -------- ----------- ------------- ----------- ----------- --------
Notes to the preliminary statements
Continued
4. Segmental information continued
Segmental income statement translated at 2016 exchange rates
It is normal practice in our industry to provide constant currency results.
Had our 2017 results been translated at 2016 exchange rates then our constant currency results would have been:
Middle
East Asia
and and
Year ended 31 December UK Europe Africa Australia Americas Total
2017 GBP000 GBP000 GBP000 GBP000 GBP000 GBP000
----------------------------- -------- -------- -------- ----------- --------- --------
Revenue 94,013 31,307 12,649 60,308 42,582 240,859
----------------------------- -------- -------- -------- ----------- --------- --------
Operating profit excluding
Group costs 15,150 4,833 1,258 7,335 3,381 31,957
----------------------------- -------- -------- -------- ----------- --------- --------
Group costs (5,819) (66) - (315) (65) (6,265)
----------------------------- -------- -------- -------- ----------- --------- --------
Operating profit 9,331 4,767 1,258 7,020 3,316 25,692
----------------------------- -------- -------- -------- ----------- --------- --------
Share of results of
associates and JV 1,633 4 - 340 - 1,977
----------------------------- -------- -------- -------- ----------- --------- --------
Financial income and
cost (458) (68) 8 46 (579) (1,051)
----------------------------- -------- -------- -------- ----------- --------- --------
Profit before taxation 10,506 4,703 1,266 7,406 2,737 26,618
----------------------------- -------- -------- -------- ----------- --------- --------
Taxation (1,474) (1,494) (322) (1,987) (1,162) (6,439)
----------------------------- -------- -------- -------- ----------- --------- --------
Profit for the year 9,032 3,209 944 5,419 1,575 20,179
----------------------------- -------- -------- -------- ----------- --------- --------
Increase/(decrease)
in 2017 results caused
by translation differences (14) (237) (214) (264) 87 (642)
----------------------------- -------- -------- -------- ----------- --------- --------
The key currencies that affect us and the average exchange rates used were:
2017 2016
-------------------- -------- --------
US dollar 1.2884 1.3558
-------------------- -------- --------
Malaysian ringgit 5.5370 5.6104
-------------------- -------- --------
Australian dollar 1.6808 1.8247
-------------------- -------- --------
South African rand 17.1503 19.9843
-------------------- -------- --------
Brazilian real 4.1129 4.7442
-------------------- -------- --------
Euro 1.1417 1.2244
-------------------- -------- --------
Notes to the preliminary statements
Continued
5. Share of associates and joint ventures
2017 2016
Year ended 31 December GBP000 GBP000
------------------------------------ -------- --------
Share of associates' profit before
taxation 2,598 1,981
Share of associates' taxation (611) (451)
------------------------------------ -------- --------
1,987 1,530
------------------------------------ -------- --------
6. Finance income
2017 2016
Year ended 31 December GBP000 GBP000
------------------------------------- -------- --------
Bank interest receivable 200 338
Other interest receivable 89 102
------------------------------------- -------- --------
Total interest receivable 289 440
------------------------------------- -------- --------
Fair value adjustments to minority 3,037 -
shareholder put option liabilities
------------------------------------- -------- --------
Total finance income 3,326 440
------------------------------------- -------- --------
7. Finance costs
2017 2016
Year ended 31 December GBP000 GBP000
------------------------------------- -------- --------
Bank interest payable (1,344) (1,227)
Interest payable on finance leases (2) (4)
------------------------------------- -------- --------
Total interest payable (1,346) (1,231)
------------------------------------- -------- --------
Fair value adjustments to minority
shareholder put option liabilities - (597)
------------------------------------- -------- --------
Total finance costs (1,346) (1,828)
------------------------------------- -------- --------
8. Taxation
2017 2016
Year ended 31 December GBP000 GBP000
---------------------------------------- -------- --------
Current taxation
Taxation in the year
- UK 1,689 891
- Overseas 5,286 3,700
Withholding taxes payable 21 (49)
Utilisation of previously unrecognised (817) -
tax losses*
Adjustment for Under (over) provision
in prior periods* 625 (104)
---------------------------------------- -------- --------
Total 6,804 4,438
---------------------------------------- -------- --------
Deferred taxation
Origination and reversal of temporary
differences (3,612) 106
Recognition of previously unrecognised
tax losses** (121) (1,093)
Effect of changes in tax rates 1,665 -
---------------------------------------- -------- --------
Total (2,068) (987)
---------------------------------------- -------- --------
Total taxation 4,736 3,451
---------------------------------------- -------- --------
* In the most part this relates to our US offices.
** Recognised to reflect the probable future corporation tax that we can reclaim.
Notes to the preliminary statements
Continued
9. Dividends
2017 2016
Year ended 31 December GBP000 GBP000
------------------------------------- -------- --------
2016 final dividend paid 6.44p on 7
July 2017 (2015: 5.60p) 5,032 4,084
2017 interim dividend paid 2.13p on
10 November 2017 (2016: 1.85p) 1,716 1,374
------------------------------------- -------- --------
6,748 5,458
------------------------------------- -------- --------
The 2017 proposed final dividend of 7.40p, totalling GBP5,996,827. Subject to shareholders approval at 8 June 2018 AGM, the dividend is payable on 6 July 2018 to shareholders on the register 8 June 2018.
The dividends relate to the profit of the following years:
2017 2016
Year ended 31 December GBP000 GBP000
-------------------------------------------- -------- --------
Interim dividend paid 2.13p on 10 November
2017 (2016: 1.85p) 1,716 1,374
Final dividends payable 7.40p on 6
July 2018 (2016: 6.44p) 5,997 4,876
-------------------------------------------- -------- --------
7,713 6,250
-------------------------------------------- -------- --------
Headline dividend cover 2.3 2.5
-------------------------------------------- -------- --------
Headline dividend cover is calculated by taking headline profit after tax attributable to equity shareholders and dividing it by the total dividends that relate to that year's profits. The Group seeks to maintain a long-term headline dividend cover of between 2 and 3. Retained profits are used to reinvest in the long term growth of the Group through funding working capital and Investing activities; and to repaying bank debt.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR PGUBCWUPRGMG
(END) Dow Jones Newswires
March 22, 2018 03:00 ET (07:00 GMT)
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