- Part 2: For the preceding part double click ID:nRSZ1957Ia
Exceptional gain on disposal of a subsidiary 8 - 42,155 42,155
Finance revenue 689 621 1,598
Finance costs (551) (1,223) (2,171)
Profit before tax 23,570 70,677 126,767
Income tax expense:
Before exceptional items (7,509) (8,883) (23,605)
Exceptional items 8 - (52) (52)
Income tax expense 9 (7,509) (8,935) (23,657)
Profit for the period 16,061 61,742 103,110
Attributable to:
Equity holders of the parent 16,061 61,742 103,110
Non-controlling interests - - -
Profit for the period 16,061 61,742 103,110
Earnings per share
- basic for profit for the period 10 13.3p 49.6p 83.9p
- diluted for profit for the period 10 13.2p 48.8p 82.1p
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
Unaudited H1 2016£'000 Unaudited H1 2015£'000 Audited Year 2015£'000
Profit for the period: 16,061 61,742 103,110
Items that may be reclassified to consolidated income statement
Gain/(loss) arising on cash flow hedge, net of amount transferred to consolidated income statement 728 (480) 1,191
Income tax effect (143) 97 (244)
585 (383) 947
Exchange differences on translation of foreign operations 21,942 (12,662) (7,783)
22,527 (13,045) (6,836)
Items not to be reclassified to consolidated income statement:
Remeasurement of defined benefit plan - - 24
Other comprehensive income for the period, net of tax 22,527 (13,045) (6,812)
Total comprehensive income for the period 38,588 48,697 96,298
Attributable to:
Equity holders of the parent 38,581 48,697 96,299
Non-controlling interests 7 (2) (1)
38,588 48,695 96,298
CONSOLIDATED BALANCE SHEET
Unaudited H1 2016£'000 Unaudited H1 2015£'000 Audited Year 2015£'000
Non-current assets
Property, plant and equipment 62,983 75,000 57,132
Investment property 10,147 - 10,260
Intangible assets 75,816 79,032 81,533
Investment in associate 53 38 40
Deferred income tax asset 11,973 14,177 12,840
160,972 168,247 161,805
Current assets
Inventories 40,546 41,379 45,647
Trade and other receivables 525,493 506,375 621,756
Prepayments 63,516 50,640 44,735
Accrued income 98,179 89,478 61,785
Derivative financial instruments 4,694 1,157 2,220
Current asset investments 35,000 - 15,000
Cash and short-term deposits 65,884 53,619 111,770
833,312 742,648 902,913
Total assets 994,284 910,895 1,064,718
Current liabilities
Trade and other payables 484,212 466,481 581,855
Deferred income 105,072 95,762 93,861
Financial liabilities 2,904 6,169 4,279
Derivative financial instruments 1,170 1,368 922
Income tax payable 12,275 8,188 10,981
Provisions 4,038 6,264 4,050
609,671 584,232 695,948
Non-current liabilities
Financial liabilities 1,339 2,564 1,703
Provisions 4,999 3,380 5,094
Deferred income tax liabilities 446 696 523
6,784 6,640 7,320
Total liabilities 616,455 590,872 703,268
Net assets 377,829 320,023 361,450
Capital and reserves
Issued capital 9,299 9,297 9,297
Share premium 3,913 3,830 3,830
Capital redemption reserve 74,957 74,957 74,957
Own shares held (11,025) (10,260) (10,571)
Translation and hedging reserves 11,359 (16,988) (11,161)
Retained earnings 289,307 259,176 295,086
Shareholders' equity 377,810 320,012 361,438
Non-controlling interests 19 11 12
Total equity 377,829 320,023 361,450
Approved by the Board on 26 August 2016
MJ Norris FA Conophy
Chief Executive Officer Group Finance Director
Consolidated statement of changes in equity
For the six months ended 30 June 2016
Attributable to equity holders of the parent Total£'000 Non- controlling interests£'000 Total equity£'000
Issued capital£'000 Sharepremium£'000 Capitalredemptionreserve£'000 Ownsharesheld£'000 Translation & hedgingreserves£'000 Retained earnings£'000
At 1 January 2015 9,283 4,597 74,957 (10,760) (4,326) 311,648 385,399 13 385,412
Profit for the period - - - - - 61,742 61,742 - 61,742
Other comprehensive income - - - - (12,662) (383) (13,045) (2) (13,047)
Total comprehensive income - - - - (12,662) 61,359 48,697 (2) 48,695
Cost of share-based payments - - - - - 2,033 2,033 - 2,033
Tax on share-based payments - - - - - 761 761 - 761
Exercise of options - - - 3,874 - (2,933) 941 - 941
Return of Value (RoV) - - - - - (97,916) (97,916) - (97,916)
Expenses on RoV - (753) - - - - (753) - (753)
Issues of B shares relating to RoV 14 (14) - - - - - - -
Purchase of own shares - - - (3,374) - - (3,374) - (3,374)
Equity dividends - - - - - (15,776) (15,776) - (15,776)
At 30 June 2015 9,297 3,830 74,957 (10,260) (16,988) 259,176 320,012 11 320,023
Profit for the period - - - - - 41,368 41,368 - 41,368
Other comprehensive income - - - - 5,827 407 6,234 1 6,235
Total comprehensive income - - - - 5,827 41,775 47,602 1 47,603
Cost of share-based payments - - - - - 2,637 2,637 - 2,637
Tax on share-based payments - - - - - 898 898 - 898
Exercise of options - - - 6,093 - (1,702) 4,391 - 4,391
Purchase of own shares - - - (6,404) - - (6,404) - (6,404)
Equity dividends - - - - - (7,698) (7,698) - (7,698)
At 31 December 2015 9,297 3,830 74,957 (10,571) (11,161) 295,086 361,438 12 361,450
Profit for the period - - - - - 16,061 16,061 - 16,061
Other comprehensive income - - - - 22,520 - 22,520 7 22,527
Total comprehensive income - - - - 22,520 16,061 38,581 7 38,588
Cost of share-based payments - - - - - 1,697 1,697 - 1,697
Tax on share-based payments - - - - - (854) (854) - (854)
Exercise of options - - - 4,613 - (4,577) 36 - 36
Issue of shares 2 83 - - - - 85 - 85
Purchase of own shares - - - (5,067) - - (5,067) - (5,067)
Equity dividends - - - - - (18,106) (18,106) - (18,106)
At 30 June 2016 9,299 3,913 74,957 (11,025) 11,359 289,307 377,810 19 377,829
CONSOLIDATED CASH FLOW STATEMENT
For the six months ended 30 June 2016
Unaudited H1 2016£'000 Unaudited H1 2015£'000 Audited Year 2015£'000
Operating activities
Profit before tax 23,570 70,677 126,767
Net finance (income)/costs (138) 601 573
Depreciation of property, plant and equipment 7,009 9,425 18,885
Depreciation of investment property 113 - 227
Amortisation of intangible assets 6,820 6,648 13,311
Share-based payments 1,697 2,033 4,670
Loss on disposal of property, plant and equipment 24 147 388
Loss on disposal of intangibles 114 21 9
Exceptional gain from disposal of a subsidiary - (42,155) (42,155)
Net cash flow from inventories 9,161 (1,568) (4,530)
Net cash flow from trade and other receivables 95,803 111,834 46,023
Net cash flow from trade and other payables (137,922) (146,362) (43,073)
Net cash flow from provisions (957) (1,172) (8,009)
Other adjustments 178 (102) (137)
Cash generated from operations 5,472 10,027 112,949
Income taxes paid (6,582) (9,029) (18,611)
Net cash flow from operating activities (1,110) 998 94,338
Investing activities
Interest received 689 621 1,598
Increase in current asset investments (20,000) - (15,000)
Proceeds from disposal of a subsidiary, net of cash disposed of - 56,145 56,145
Proceeds from disposal of property, plant and equipment 97 18 653
Purchases of property, plant and equipment (6,531) (7,862) (13,303)
Purchases of intangible assets (2,071) (2,000) (7,294)
Net cash flow from investing activities (27,816) 46,922 22,799
Financing activities
Interest paid (551) (1,042) (2,171)
Dividends paid to equity shareholders of the parent (18,106) (15,776) (23,474)
Return of Value - (97,916) (97,916)
Expenses on Return of Value - (767) (753)
Proceeds from share issues 121 941 5,332
Purchase of own shares (5,067) (3,374) (9,778)
Repayment of capital element of finance leases (1,247) (1,704) (3,223)
Repayment of loans (942) (433) (1,713)
New borrowings - 113 1,030
Net cash flow from financing activities (25,792) (119,958) (132,666)
Decrease in cash and cash equivalents (54,718) (72,038) (15,529)
Effect of exchange rates on cash and cash equivalents 8,861 (4,493) (1,937)
Cash and cash equivalents at the beginning of the period 111,680 129,146 129,146
Cash and cash equivalents at the end of the period 65,823 52,615 111,680
1 CORPORATE INFORMATION
The interim condensed consolidated financial statements of the Group for the
six months ended 30 June 2016 were authorised for issue in accordance with a
resolution of the Directors on 26 August 2016.
Computacenter plc is a limited company incorporated and domiciled in England
whose shares are publicly traded.
2 BASIS OF PREPARATION
The interim condensed consolidated financial statements for the six months
ended 30 June 2016 have been prepared in accordance with International
Accounting Standard 34 'Interim Financial Reporting', as adopted by the
European Union. They do not include all of the information and disclosures
required in the annual financial statements, and should be read in conjunction
with the Group's annual financial statements as at 31 December 2015 which have
been prepared in accordance with International Financial Reporting Standards
(IFRS) as adopted by the European Union.
The Group has maintained its positive cash position in the period. In order to
ensure that the Group can maintain its strong liquidity position it has a £40
million committed facility, which remained unutilised at the reporting date.
The Group's forecast and projections, which allow for reasonably possible
variations, show that the Group will continue to maintain its strong liquidity
position, and therefore supports the Directors' view that the Group has
sufficient funds available to meet its foreseeable requirements. The Directors
have concluded therefore that the going concern basis remains appropriate.
3 BASIS OF PREPARATION
The accounting policies applied by the Group in these interim condensed
consolidated financial statements are the same as those applied by the Group
in its consolidated financial statements for the year ended 31 December 2015,
except for the adoption of new standards and interpretations as of 1 January
2016, which did not have any impact on the accounting policies, financial
position or performance of the Group, as noted below:
• Annual Improvements to IFRSs - 2010-2012 Cycle
• Annual Improvements to IFRSs - 2011-2013 Cycle
The Group has not early adopted any other standard, interpretation or
amendment that has been issued but is not yet effective.
4 ADJUSTED MEASURES
The Group uses a number of non-Generally Accepted Accounting Practice
(non-GAAP) financial measures in addition to those reported in accordance with
IFRS. The Directors believe that these non-GAAP measures, detailed below, are
important when assessing the underlying financial and operating performance of
the Group.
Adjusted revenue, adjusted Services revenue, adjusted Professional Services
revenue, adjusted Supply Chain revenue, and adjusted administrative expenses
excludes the revenue and administrative expenses from a disposed subsidiary,
RDC, for the comparative reporting periods. RDC was sold on 2 February 2015.
Adjusted operating profit or loss, adjusted profit or loss before tax,
adjusted profit or loss for the year, adjusted earnings per share and adjusted
diluted earnings per share are, as appropriate, each stated before:
exceptional and other adjusting items including gain or loss on business
disposals, amortisation of acquired intangibles, utilisation of deferred tax
assets (where initial recognition was as an exceptional item or a fair value
adjustment on acquisition), and the related tax effect of these exceptional
and other adjusting items, as Management do not consider these items when
reviewing the underlying performance of the segment or the Group as a whole.
Each of these measures also excludes the results of RDC for the comparative
periods.
Additionally, adjusted operating profit or loss includes the interest paid on
customer-specific financing (CSF) which Management considers to be a cost of
sale.
A reconciliation between key adjusted and statutory measures is provided on
page 13 of the Group Finance Director's review. Further detail is also
provided within note 5, segment information.
5 SEGMENT INFORMATION
For management purposes, the Group is organised into geographical segments,
with each segment determined by the location of the Group's assets and
operations. The Group's business in each geography is managed separately.
No operating segments have been aggregated to form the reportable operating
segments shown below.
Segmental performance for the periods to H1 2016, H1 2015 and Full Year 2015
were as follows:
Six months ended 30 June 2016 (unaudited)
UK£'000 Germany£'000 France£'000 Belgium£'000 Total£'000
Revenue
Adjusted Supply Chain revenue 408,448 395,395 160,569 15,837 980,249
Adjusted Services revenue
Professional Services 58,194 62,943 8,063 851 130,051
Managed Services 186,116 149,453 24,519 7,831 367,919
Total adjusted Services revenue 244,310 212,396 32,582 8,682 497,970
Total adjusted revenue 652,758 607,791 193,151 24,519 1,478,219
RDC - - - - -
Supply Chain revenue - - - - -
Professional Services revenue - - - - -
Total RDC revenue - - - - -
Statutory revenue 652,758 607,791 193,151 24,519 1,478,219
Results
Adjusted gross profit 91,080 75,219 19,259 3,706 189,264
Administrative expenses (77,050) (65,703) (18,354) (3,121) (164,228)
Adjusted operating profit 14,030 9,516 905 585 25,036
Adjusted net interest 457 (36) (158) (14) 249
Adjusted profit before tax 14,487 9,480 747 571 25,285
Exceptional items:
- onerous contracts trading losses - - - - -
- onerous contracts provision for future losses - - - - -
- exceptional gains/(losses) - - (1,114) - (1,114)
Total exceptional items - - (1,114) - (1,114)
Gain on disposal of a subsidiary - - - - -
Amortisation of acquired intangibles - (561) - (40) (601)
RDC - - - - -
Statutory profit/(loss) before tax 14,487 8,919 (367) 531 23,570
The reconciliation for adjusted operating profit to statutory operating profit
as disclosed in the Consolidated Income Statement is as follows:
Six months ended 30 June 2016 (unaudited)
UK£'000 Germany£'000 France£'000 Belgium£'000 Total£'000
Adjusted segment operating profit/(loss) 14,030 9,516 905 585 25,036
Add back interest on CSF 5 106 - - 111
Amortisation of acquired intangibles - (561) - (40) (601)
Exceptional items - - (1,114) - (1,114)
RDC - - - - -
Segment operating profit/(loss) 14,035 9,061 (209) 545 23,432
Other segment information
Share-based payments 1,375 306 16 - 1,697
Six months ended 30 June 2015 (unaudited)
UK£'000 Germany£'000 France£'000 Belgium£'000 Total£'000
Revenue
Adjusted Supply Chain revenue 425,099 349,624 157,937 16,106 948,766
Adjusted Services revenue
Professional Services 64,665 51,061 8,381 752 124,859
Managed Services 198,923 134,669 23,477 7,263 364,332
Total adjusted Services revenue 263,588 185,730 31,858 8,015 489,191
Total adjusted revenue 688,687 535,354 189,795 24,121 1,437,957
RDC
Supply Chain revenue 3,157 - - - 3,157
Professional Services revenue 290 - - - 290
Total RDC revenue 3,447 - - - 3,447
Statutory revenue 692,134 535,354 189,795 24,121 1,441,404
Results
Adjusted gross profit 102,920 67,026 12,561 3,011 185,518
Administrative expenses (80,008) (58,505) (15,554) (1,962) (156,029)
Adjusted operating profit/(loss) 22,912 8,521 (2,993) 1,049 29,489
Adjusted net interest 273 (738) 94 (52) (423)
Adjusted profit/(loss) before tax 23,185 7,783 (2,899) 997 29,066
Exceptional items:
- onerous contracts trading losses - (690) - - (690)
- onerous contracts provision for future losses - 1,126 - - 1,126
- exceptional gains/(losses) - - (449) - (449)
Total exceptional items - 436 (449) - (13)
Gain on disposal of a subsidiary 42,155 - - - 42,155
Amortisation of acquired intangibles (240) (572) - (39) (851)
RDC 320 - - - 320
Statutory profit/(loss) before tax 65,420 7,647 (3,348) 958 70,677
The reconciliation for adjusted operating profit to operating profit, as
disclosed in the Consolidated Income Statement, is as follows:
Six months ended 30 June 2015 (unaudited)
UK£'000 Germany£'000 France£'000 Belgium£'000 Total£'000
Adjusted segment operating profit/(loss) 22,912 8,521 (2,993) 1,049 29,489
Add back interest on CSF 33 147 - - 180
Amortisation of acquired intangibles (240) (572) - (39) (851)
Exceptional items - 436 (449) - (13)
RDC 319 - - - 319
Segment operating profit/(loss) 23,024 8,532 (3,442) 1,010 29,124
Other segment information
Share-based payments 1,711 180 142 - 2,033
Year ended 31 December 2015
UK£'000 Germany£'000 France£'000 Belgium£'000 Total£'000
Revenue
Adjusted Supply Chain revenue 875,041 820,196 335,024 33,686 2,063,947
Adjusted Services revenue
Adjusted Professional Services revenue 137,390 107,416 16,101 1,645 262,552
Managed Services revenue 394,943 272,006 46,934 13,785 727,668
Total adjusted Services revenue 532,333 379,422 63,035 15,430 990,220
Total adjusted revenue 1,407,374 1,199,618 398,059 49,116 3,054,167
RDC
Supply Chain revenue 3,158 - - - 3,158
Professional Services revenue 290 - - - 290
Total RDC revenue 3,448 - - - 3,448
Statutory revenue 1,410,822 1,199,618 398,059 49,116 3,057,615
Results
Adjusted gross profit 216,445 147,346 32,083 6,258 402,132
Adjusted administrative expenses (157,110) (119,937) (33,715) (4,263) (315,025)
Adjusted operating profit/(loss) 59,335 27,409 (1,632) 1,995 87,107
Adjusted net interest 601 (577) (178) (79) (233)
Adjusted profit/(loss) before tax 59,936 26,832 (1,810) 1,916 86,874
Exceptional items:
- onerous contracts trading losses - (1,123) - - (1,123)
- onerous contracts provision for future losses - 1,559 - - 1,559
- exceptional losses on redundancy and other restructuring costs - - (1,465) - (1,465)
Total exceptional items - 436 (1,465) - (1,029)
Exceptional gain on disposal of a subsidiary 42,155 - - - 42,155
Amortisation of acquired intangibles (361) (1,116) - (76) (1,553)
RDC 320 - - - 320
Statutory profit/(loss) before tax 102,050 26,152 (3,275) 1,840 126,767
The reconciliation for adjusted operating profit to statutory operating profit
as disclosed in the Consolidated Income Statement is as follows:
Year ended 31 December 2015
UK£'000 Germany£'000 France£'000 Belgium£'000 Total£'000
Adjusted operating profit/(loss) 59,335 27,409 (1,632) 1,995 87,107
Add back interest on CSF 56 284 - - 340
Amortisation of acquired intangibles (361) (1,116) - (76) (1,553)
Exceptional items - 436 (1,465) - (1,029)
RDC 320 - - - 320
Statutory operating profit/(loss) 59,350 27,013 (3,097) 1,919 85,185
6 SEASONALITY OF OPERATIONS
Historically, revenues have been higher in the second half of the year than in
the first six months. This is principally driven by customer buying behaviour
in the markets in which we operate. Typically this leads to a more pronounced
effect on operating profit. In addition, the effect is compounded further by
the tendency for the holiday entitlements of our employees to accrue during
the first half of the year and to be utilised in the second half.
7 DIVIDENDS PAID AND PROPOSED
A second interim dividend for 2015 of 15.0 pence per ordinary share was paid
on 5 April 2016. An interim dividend in respect of 2016 of 7.2 pence per
ordinary share, amounting to a total dividend of £8,831,370, was declared by
the Directors at their meeting on 25 August 2016. The expected payment date of
the dividend declared is 14 October 2016. This interim report does not reflect
this dividend payable.
8 EXCEPTIONAL ITEMS
Unaudited H1 2016£'000 Unaudited H1 2015 £'000 Audited Year 2015 £'000
Operating profit
Redundancy and other restructuring costs (1,114) (449) (1,465)
Onerous contracts - 436 436
(1,114) (13) (1,029)
Gain on disposal of a subsidiary - 42,155 42,155
Exceptional items before taxation (1,114) 42,142 41,126
Income tax
Tax on onerous contracts included in operating profit - (52) (52)
Exceptional items after taxation (1,114) 42,090 41,074
2016:
Included within the current period are the following exceptional items:
• During the current period a Line of Business restructure has been
agreed with the business in France. This initiative to reduce the
underutilised resources within our Professional Services arm will complete in
H2 2016, the full cost of £1.0 million has been recognised as at 30 June 2016.
This restructure will see Computacenter France exit the direct provision of
Group Field Maintenance Services. This Line of Business has materially
decreased over time, leading to a significant resourcing overcapacity. Any
future residual customer requirement will be sub-contracted to an existing
third party provider.
• Computacenter France is close to completing responsibilities under the
Social Plan related to the substantial restructuring exercise that occurred in
2014. An additional cost of £0.1 million has been recognised as part of the
wind-down of the Social Plan. As the redundancy and restructuring costs were
previously treated as an exceptional item on recognition, this further
provision has also been treated as an exceptional item.
2015:
Included within the prior period are the following exceptional items:
• Computacenter (UK) Limited disposed of its wholly owned subsidiary RDC
during the year. An exceptional gain of £42.2 million was recognised on
disposal of RDC. In line with our accounting policy, Management elected under
IAS1 to report this gain as a separate line item on the face of the
income statement due to the materiality, infrequency and nature of the gain on
disposal of RDC. As noted within the summary of significant accounting
policies the adjusted results excluded this gain. This election provided the
best guidance to users of our external reporting as to the underlying
profitability trends within the Group and presented the results of the Group
in a way that is fair, balanced and understandable.
• Computacenter France continued with its substantial restructuring
exercise that began in 2014. An additional cost of £0.4 million was recognised
as part of the Social Plan. As the redundancy and restructuring costs were
previously treated as an exceptional item on recognition, the further
provision has also been treated as an exceptional item.
• The Group's remaining two onerous contracts continued to show
operational improvements therefore management revised its estimates of the
losses to be incurred. On this basis the Group released £0.4 million of the
provision. As the onerous contracts were previously treated as an
exceptional item on recognition, the write back of the provision was also
released as an exceptional item
9 INCOME TAX
The Group calculates the period income tax expense using the tax rate that
would be applicable to the total expected annual earnings.
The charge based on the profit for the period comprises:
Unaudited H1 2016£'000 Unaudited Audited Year 2015 £'000
H1 2015 £'000
Tax charged in the consolidated income statement
Current income tax
UK corporation tax 3,487 6,077 14,639
Foreign tax 3,244 3,643 6,485
Adjustments in respect of prior periods - - (232)
Total current income tax 6,731 9,720 20,892
Deferred tax
- origination and reversal of temporary differences (114) (785) (1,276)
- adjustments in respect of prior years - - (276)
- changes in recoverable amounts of deferred tax assets 892 - 4,265
Exceptional items - - 52
Total deferred tax 778 (785) 2,765
Tax charge in the consolidated income statement 7,509 8,935 23,657
10 EARNINGS PER SHARE
Earnings per share ('EPS') amounts are calculated by dividing profit
attributable to ordinary equity holders by the weighted average number of
ordinary shares outstanding during the period (excluding own shares held).
To calculate diluted earnings per share, the weighted average number of
ordinary shares in issue is adjusted to assume conversion of all dilutive
potential shares. Share options granted to employees where the exercise price
is less than the average market price of the Company's ordinary shares during
the period are considered to be dilutive potential shares.
Unaudited H1 2016£'000 Unaudited H1 2015£'000 Audited Year 2015 £'000
Profit attributable to equity holders oftheparent 16,061 61,742 103,110
Unaudited H1 2016£'000 Unaudited H1 2015£'000 Audited Year 2015 £'000
Basic weighted average number of shares (excluding own shares held) 120,617 124,571 122,948
Effect of dilution:
Share options 879 2,014 2,655
Diluted weighted average number of shares 121,496 126,585 125,603
Unaudited H1 2016pence Unaudited H1 2015pence Audited Year 2015 pence
Basic earnings per share 13.3 49.6 83.9
Diluted earnings per share 13.2 48.8 82.1
11 FAIR VALUE MEASUREMENTS RECOGNISED IN THE CONSOLIDATED BALANCE SHEET
Financial instruments which are recognised at fair value subsequent to initial
recognition are grouped into Levels 1 to 3 based on the degree to which the
fair value is observable. The three levels are defined as follows:
Level 1 fair value measurements are those derived from quoted prices
(unadjusted) in active markets for identical assets or liabilities;
Level 2 fair value measurements are those derived from inputs other than
quoted prices included within Level 1 that are observable for the asset or
liability, either directly (i.e. as prices) or indirectly (i.e. derived from
prices); and
Level 3 fair value measurements are those derived from valuation techniques
that include inputs for the asset or liability that are not based on
observable market data (unobservable inputs).
At 30 June 2016 the Group had forward currency contracts, which were measured
at Level 2 fair value subsequent to initial recognition, to the value of a net
asset of £3,524,000 (30 June 2015: £210,000 net liability, 31 December 2015:
£1,298,000 net asset).
The net realised gains from forward currency contracts in the period to 30
June 2016 of £1,335,000 (30 June 2015: £2,255,000 loss, 31 December 2015:
£747,000 gain), are offset by broadly equivalent realised losses/gains on the
related underlying transactions. There were no transfers between Level 1 and
Level 2 during the period (2015: nil).
The foreign currency forward contracts are measured based on observable spot
exchange rates, the yield curves of the respective currencies as well as the
currency basis spreads between the respective currencies. All contracts are
fully cash collateralised, thereby eliminating both counterparty and the
Group's own credit risk.
The carrying value of the Group's short-term receivables and payables is a
reasonable approximation of their fair values. The fair value of all other
financial instruments carried within the Group's financial statements is not
materially different from their carrying amount.
12 PUBLICATION OF NON-STATUTORY ACCOUNTS
The financial information contained in the interim statement does not
constitute statutory accounts as defined in section 435 of the Companies Act
2006.
The comparative figures for the financial year ended 31 December 2014 are not
the company's statutory accounts for that financial year. Those accounts have
been reported on by the company's auditor and delivered to the registrar of
companies. The report of the auditor was (i) unqualified,
(ii) did not include a reference to any matters to which the auditor drew
attention by way of emphasis without qualifying their report, and (iii) did
not contain a statement under section 498 (2) or (3) of the Companies Act
2006.
This information is provided by RNS
The company news service from the London Stock Exchange