REG - GVC Holdings PLC - Final Results <Origin Href="QuoteRef">GVC.L</Origin> - Part 1

EntainAnnouncement

23/03/2015 07:00

RNS Number : 1106I
GVC Holdings PLC
23 March 2015
GVC Holdings PLC
("GVC" or the "Group")
Preliminary Results for year ended 31 December 2014, 
Trading Update for period from 1 January 2015 to 18 March 2015,
Announcement of increased quarterly dividend and special dividend
GVC Holdings PLC (AIM:GVC), a leading online sports betting and gaming group, today announces its Preliminary Results for the year ended 31 December 2014 together with a recommended quarterly dividend and a recommended special dividend.
Dividend and returns to shareholders
Quarterly dividend raised from 12.5 cents to 14.0 cents per share. In addition we are proposing a further 1.5 cents per share special dividend, giving a total of 15.5 cents per share payable 6 May 2015
On a "declared" basis, this results in 2014 dividends of 55.5 cents (2013: 48.5 cents), an increase of 14.4% over 2013
Dividends paid in 2014 amounted to: 68% of Clean EBITDA and 79% of Clean Net Operating Cashflows
Total returns to shareholders since the completion of the acquisition of Sportingbet two years ago include a share price rise of over 2.00 and, including today's dividend declaration, total dividends announced of 1.04 per share 
2014 Financial highlights
Impressive revenue growth resulting from increased marketing and a strong World Cup performance
Wagers up 25% to 1,464 million (2013: 1,170 million)
Sports Gross Margin 9.8% (2013: 9.6%)
Net Gaming Revenue ("NGR") up 32% to 225 million (2013: 170 million)
Contribution up 20% to 123 million (2013: 103 million)
Clean EBITDA up 28% to 49.2 million (2013: 38.3 million)
Profit Before Tax increased 217% to 41.3 million (2013: 13.0 million)
2015 Current Trading (1.1.15 to 18.3.15 "Q1")
Deposits up 20% to 1.7million per day
Q1-2015 wagers 4,601k per day up 22% on Q1-2014 (3,765k)
Q1-2015 sports gross margin was 8.9% against 10.0% in same period in 2014
Q1-2015 NGR 661k per day, up 18% on Q1-2014 (559k)
Q1-2015 in-play revenues rose 19% to 300k per day (Q1-2014 252k)


Kenneth Alexander, Chief Executive of GVC Holdings PLC, commenting on the results said: 
"During 2014 GVC continued to grow NGR, up by 32% in the year; it achieved a 22% EBITDA margin; and distributed 68% of its Clean EBITDA and 79% of its Clean Net Operating Cash by way of dividends. This is an exceptional performance and our growth continues in the broad spread of markets in which we operate. We control our costs very tightly, have highly motivated employees who have financial incentives aligned to shareholders and we are in a strong position to be a consolidator in the industry. I am delighted to announce, yet again, a proposed increase in the quarterly dividend along with a special dividend which in total amounts to a year-on-year increase of 14% in the dividends declared so that shareholders will receive a total of 15.5 cents in May 2015. GVC has never been in a stronger position and we look forward to 2015 and beyond with confidence."
- Ends -
For further information:
GVC Holdings PLC

Kenneth Alexander, Chief Executive Officer
Tel: +44 (0) 1624 652 559
Richard Cooper, Chief Financial Officer
www.gvc-plc.com
Cenkos Securities PLC
Tel: +44 (0) 20 7397 8900
Mark Connelly, Stephen Keys

Media enquiries:
Bell Pottinger

David Rydell, James Newman
Tel: +44 (0) 20 3772 2500
GVC@bellpottinger.com

About GVC Holdings PLC
GVC Holdings PLC is a leading online sports betting and gaming group. It operates a number of brands across over 20 countries. The Group has over 700 employees and is headquartered in the Isle of Man and is licensed in Malta, Denmark, UK, South Africa, Alderney and the Dutch Caribbean.
Definitions used in the announcement
Clean EBITDA:Earnings before interest, taxation, depreciation, amortisation, impairment charges, share option charges and exceptional items.
Clean Net Operating Cashflow ('CNOC'): Clean EBITDA less: capitalised development costs, net corporate taxes paid, capital expenditure, finance lease payments and net working capital movements, and exceptional items of a cash nature.
Sports Gross Margin: Sports wagers less payouts.
Sports Gross Margin %: Sports Gross Margin divided by Sports wagers.
Net Gaming Revenue ('NGR'): Sports Gross Margin, plus net gaming stakes less payouts winnings, less customer bonuses.
Proforma Revenue:Being the underlying levels of the business as if the revenues of the B2B partner, East Pioneer Corporation B.V. were fully consolidated in the results of GVC for 2013.
Contribution: Gross Margin less commissions, revenue share and marketing costs.
Totals may not sum due to rounding and percentages have been calculated on the underlying rather than the summarised figures.
Further information on the Group is available at www.gvc-plc.com

Chairman's Statement
I am pleased to announce that 2014 has been a record year with excellent results. Increased and effective marketing in all territories led to: growth in Net Gaming Revenue (NGR), up 32% on 2013 to 225 million; Clean EBITDA up 28% to 49.2 million and Profit Before Tax increasing 217% to 41.3 million. 
The Group is now generating over 1.5 billion a year in sports wagers, and total revenues in the 77 days of first quarter of 2015 to 18 March 2015 exceeded 51 million, an average of more than 661k per day, up 18% on first quarter 2014 (559k). The Group continues to be highly cash generative driving progress through organic growth and its proven track record of acquisitions. In the two years since the acquisition of Sportingbet on 19 March 2013, the Group has declared 63.5 million in dividends and its market capitalisation has risen 87% to close to 290 million. I am also pleased to announce a further 15.5 cents per share dividend today, including a 1.5 cents special dividend. We look forward to presenting this for shareholder approval at the AGM. GVC is ranked as one of the highest yielding dividend payers on AIM. 
Cash generation and its conversion into dividends continues to be central to the Group's focus. With GVC's strong performance for 2014 and the Board's confidence in the outlook for the current financial year, the board therefore aims to set 14.0 cents as its new quarterly dividend benchmark, and the 1.5 cents per share special dividend in essence backdates this policy to January 2015. The record date for the dividend will be Friday 10 April. The "ex-div" date will be Thursday 9 April and the payment date will be 6 May 2015.
The Group's strategy is to increase shareholder returns through a combination of: high levels of cash generation through organic growth and acquisitions, redistributing this by way of dividends to shareholders; increasing the markets in which the Group trades to diversify geographic risk; and improving the quality and mix of the Group's earnings through strategic acquisitions and joint ventures. GVC has a proven ability of generating value through successful integration of significant acquisitions and management is confident this will continue. In the next 12 months, the Group aims to continue to improve the product offering, particularly mobile; continue growing the many markets in which the Group operates; and devote more executive time to non-dilutive investment and accretive acquisition opportunities.
The Company has a highly focused and entrepreneurial culture, supported by an employee bonus structure aligned with dividend levels. Moving into 2015, GVC is in the strongest position it has ever been, and the Group's wide spread of geographies and products position it at the forefront of many emerging and fast-growing markets which gives the Board confidence in the Group's prospects in 2015 and beyond.
As mentioned above, current trading (Q1 2015 to 18 March 2015) is at record levels, with sports wagers averaging 4.6 million per day, a sports margin of 8.9 % and an average Net Gaming Revenue increasing by 18% to 661k per day compared to 559k in 2014, producing yet another quarter of growth. The Board is therefore confident of a successful 2015 as demonstrated by our proposed respective 14 cents final and 1.5 cents special dividends.
Lee Feldman
Chairman and Non-Executive Director
20 March 2015
* closing price on 19 March 2013 2.49, closing price on 19 March 2015 4.56.


Report of the Chief Executive
In 2014 GVC delivered excellent operational and organic growth across the broad spread of markets in which the Company operates. The Board is pleased to report a series of significant increases over those achieved in 2013 across all key financial metrics as shown below.

Percentage
Increase
2014
()
2013
()
Sports wagers
25%
1.5 billion
1.2 billion
Proforma Revenue
23%
225 million
182 million
NGR
32%
225 million
170 million
Contribution
20%
123 million
103 million
Clean EBITDA
28%
49.2 million
38.3 million
Operating profit
204%
42.9 million
14.1 million
Profit before tax
217%
41.3 million
13.0 million
Basic EPS
195%
66.4 cents
22.5 cents
Dividends declared
14%
55.5 cents
48.5 cents
Totals may not sum due to rounding and percentages have been calculated on the underlying rather than the summarised figures.
The Group has achieved a record level of Clean EBITDA for 2014 at 49.2 million which is 28% higher than the prior year, giving rise to Clean Net Operating Cash Flows of 42.6 million.
While the focus of 2013 was the integration of the transformational Sportingbet acquisition, 2014 was about identifying where GVC's products and services could be improved, positioning the Group for the 2014 World Cup and using this as an event to secure organic growth.
The World Cup was a resounding success for the Group. Not only was the four week event itself prosperous for the Group, particularly in the host country, Brazil, but the event led to a 'step-change' in the retention and acquisition of customers beyond the World Cup final in many of the territories in which the Group operates.
GVC invested approximately GVC's 7 million into marketing around the World Cup and reaped an immediate benefit in profitability which, following its policy on dividend distribution, allowed the Group in September 2014 to declare a special dividend of 1.5 cents, and thus returned 1.5 million of the World Cup net profits (approximately 2 million) back to shareholders, in line with its stated dividend policy.
In line with its strategy for 2014, GVC invested in its products. These investments which totaled 3.3 million (2013: 4k) have been capitalised as required under IAS 38 'Intangible Assets'. Given that mobile is fast becoming the natural choice for players in many markets, continued investment in mobile is seen to be key to future success. In addition, GVC has broadened its games offering through third party integration. As stated previously, the ability to offer market leading in-play products is a significant milestone in unlocking additional organic growth opportunities. In addition, efforts in widening our payments capability and content to assist the expansion of our in-play market were key achievements as in-play represented 71% of Sports Gross Gaming Revenue ("GGR") in Q4 2014.
In order to continue the growth momentum achieved in 2014, the strategic product investments GVC plan for 2015 will be around 50% higher than 2014. We believe that increased investment will not only help maintain GVC's position in its current markets but also be accretive to revenue, as already evidenced by the growth in wagering and gaming revenues.
Average daily KPIs expressed in 000s









Prior quarter history

Q1-2015*
Q1-2014
Year on year change
Q2-2014
Q3-2014
Q4-2014
Sports wagers
4,601
3,765
+22%
3,907
3,995
4,366
Sports Margin %
8.9%
10.0%

9.8%
10.5%
9.0%







Sports GGR** %






-In play
73%
67%

59%
61%
70%
-Mobile
35%
21%

24%
28%
34%







Sports NGR
306
279
+10%
296
330
302
Gaming NGR
355
280
+27%
306
325
345
Total NGR
661
559
+18%
602
655
647
* to18 March 2015
** wagers less payouts before bonuses
Sports margin percentages fluctuate daily depending on sports results, however GVC's combination of diversified geographies and the success of its in-play product mitigate this volatility. In 2014, the monthly gross margin ranged from a low of 8.3% to a high of 11.8% with an average of 9.8% (2013: 9.6%). 
I am pleased to report that momentum has continued in Q1 - 2015 with sports wagers growing 22% to 4.6 million per day (Q1-2014 3.8 million) and NGR growing 18% to 661k per day (Q1-2014 559k).
GVC has also expanded its geographic diversification through its 15% stake in Scandinavian-facing start-up Betit. This business has had a strong start and its stake in this entity does allow the Group to acquire the balance in Q4-2017 for a minimum of 70 million providing that the profits of the entity are of sufficient scale to warrant the investment and would be immediately accretive to the Group. The results of Betit are not consolidated in our financial statements however as its stake has been accounted for as an available for sale asset.
The Group now has over 700 co-workers. GVC is proud that the bonus structure for all staff has a highly material relationship to dividend declarations and that this correlation to shareholders' interests allows GVC to incentivise its staff in a transparent way, which facilitates the retention and recruitment of talented people.
Despite the underlying complexities of the Group, the business can be presented in a simple and transparent way as the table below illustrates:


Year ended 31 December 2014

Q1-2015*
'Formula'

000s
000s
Per day
000s
Per day
000s
a
Wagers

1,463,523
4,010
4,601
b
Margin %

9.8%


c = a x b
Gross margin

143,544


d
Sports bonus

(33,345)


e = c + d
Sports NGR

110,199


f
Gaming NGR across all brands

114,602


g = e + f
TOTAL NGR

224,801
616
661
h
Variable cost %

45.2%


j = g x h
Variable costs

(101,513)


k = g + j
CONTRIBUTION

123,288


m
Other expenditure

(74,126)


n = k + m
CLEAN EBITDA

49,162


p = n / g
CLEAN EBITDA %

21.9%


q
Capitalised development costs
(3,343)



r
Net corporate taxes paid
(508)



s
Working capital and other movements
(742)



t
Capex and lease payments
(1,951)



u = sum q-t
Total of additional operating cashflows

(6,544)


v = n + u
CLEAN NET OPERATING CASHFLOWS ('CNOC')

42,618


w = v / g
NOC %

19.0%


y
Dividends

(33,607)


z = y / v
Dividends as a % of CNOC

78.9%


* to 18 March 2015.
Net non-operating cash out-flows in 2014 amounted to just under 10 million. These included: the investment cost in Betit (3.6 million); earn-outs payable under the 2009 acquisition of Betboo (4.3 million); the first of three tranches of the repayment of the loan from William Hill (2.8 million), offset by 0.8 million received on the exercise of options.
GVC's presence in frontier markets provide first mover advantage and exposure to high growth revenues. In addition increased regulation should allow GVC to achieve better co-operation with governments and therefore promotion of its products to an increased audience, so these developments should be positive for GVC and the industry in the long-term.
In the UK in particular the new tax-regime has increased headwinds for smaller and less diversified operators. The strength of GVC's diversified operations coupled with strong cash generation and cash control place the Group in an enviable position in the industry, although GVC is not immune to movements in rates of foreign exchange. In 2015, it is the intention that GVC will continue to build on its exceptional record of integrating strategic acquisitions and the focus will be on increasing the diversification of our revenues by targeting accretive acquisition in regulated markets. However, should the right opportunity arise, we would also consider acquisition opportunities in unregulated markets. 
I end my report on a very upbeat note - The Board believe the Group has never been in a stronger position than now; robust trading; diversified products and markets; highly motivated staff; and technological developments which will allow the Group to prosper. For this reason I am delighted to be able to announce a further increase in the quarterly dividend to 14.0 cents per share plus a final special dividend of 1.5 cents per share.
Kenneth Alexander
Chief Executive
20 March 2015
Report of the Finance Director
SUMMARY
 The combination of the World Cup, higher sports margin and a full year of the acquired Sportingbet business led to NGR increasing by a third over 2013 to 225 million on wagers of 1.5 billion
 Contribution margin remained buoyant at 55% despite a considerable investment in marketing in the Latin America region, before, during and after the World Cup
 The clean EBITDA margin rose slightly over 2013 to 22% (49.2 million) leading to a 28.4% increase for the year
 Operating profit at 42.9 million was 26.9% higher than 2013 (normalised to exclude exceptional items) despite a 4.6% increase in depreciation and amortisation resulting from purchases of equipment and capitalisation of development software
 Basic EPS rose to 66.4 cents, up 195%
 CNOC as defined below in table 1, was 42.6 million out of which the Group distributed 33.6 million in dividends equal to a distribution ratio of 79% (2013: 18.1 million, dividend of 15 million, distribution ratio 83%)
Table 1: Summary of key financial measures
Totals may not sum due to rounding and percentages have been calculated on the underlying rather than the summarised figures.
In millions
2014
2013
Change
% change
Sports wagers
1,463.5
1,169.5
294
25%





Sports margin
9.8%
9.6%







Sports revenue
110.2
90.8
19.4
21%
Gaming revenue
114.6
91.3
23.3
26%
Total proforma revenue
224.8
182.1
42.7
23%





Total NGR
224.8
170.0
54.8
32%





Contribution
123.3
102.6
20.7
20%
Contribution divided by PFR =
55%
56%


Expenditure
(74.1)
(64.3)
(9.8)
(15)%
Clean EBITDA
49.2
38.3
10.9
28%
Clean EBITDA/proforma revenue
22%
21%


Depreciation and amortisation
(3.9)
(3.7)
(0.2)
(5)%
Share option charges
(0.8)
(0.7)
(0.1)
-
Betit valuation charge
(1.6)
-
(1.6)
-
Finance charges
(1.6)
(1.1)
(0.5)
(45)%
PBT and exceptional items
41.3
32.8
8.5
26%
Exceptional items
-
(19.7)
19.7

Taxation
(0.7)
(0.7)


Profit after taxation
40.5
12.3
28.2
230%





Basic, non dilutive EPS in cents
66.4
22.5

195%





Dividend paid in the year / share in cents
55.0
28.0

96%
Dividends declared for the year / share in cents
55.5
48.5

14%





Clean net operating cashflows 
42.6
18.1

135%
Dividends paid
(33.6)
(15.0)

124%





Cash and cash in transit
40.0
37.1
2.9
8%
- Cash and cash equivalents
17.8
18.8


- Balances with payment processors
22.2
18.3


Customer liabilities
(13.0)
(13.3)
0.3
2%
Net current (liabilities)/assets
(0.9)
0.3
(1.2)
(300)%
Non-current liabilities
(8.8)
(14.0)


- Interest bearing loans and borrowings
(0.4)
(1.2)


- Non-interest bearing loan and borrowings
(2.8)
(5.2)


- Deferred consideration on Betboo
(3.9)
(7.6)


- Betit valuation liability
(1.7)
-







Shareholder funds
149.5
141.1


Number of shares in issue
61,276,480
60,906,760


Number of shares under option
6,806,947
3,801,667


REVENUES
Sports wagers grew 25% to 1,463.5 million (2013: 1,169.5 million). They averaged 4.0 million per day and rose to 4.4 million per day in Q4 (Q4-2013: 3.9 million).
Sports margins differ widely across the multiple markets in which GVC operates as a consequence of the maturity of each market and the sports followed within them. A sports margin of 9.8% (2013: 9.6%) was achieved despite the industry-wide backdrop of 'punter-friendly' results in Q4-2014.
Sports NGR represents the sports gross margin less free bets and promotional bonuses.
Customers have a variety of gaming opportunities ranging from Casino, through to Poker and, in certain markets, Bingo. Sports and gaming revenues are relatively equal now, and in 2014 Sports NGR represented 49% of proforma revenue and Gaming NGR represented 51%.
2014 saw a 24% increase in Proforma Revenues over 2013. In the prior year accounting standards required the third party contract with East Pioneer Corporation BV to be consolidated from 19 March 2013 whereas prior to this the results were not consolidated. To report a like-for-like figure to 2014, the Group uses Proforma Revenue as a measure. The difference between Proforma Revenue and NGR in 2014 was nil (2013: 20 million).
Table 2: Average revenues per day per quarter from 1 January 2014 until 18 March 2015
000's
*Q1-2015
Q1-2014
Q2-2014
Q3-2014
Q4-2014
Sports wagers per day
4,601
3,765
3,907
3,995
4,366
Sports margin %
8.9%
10.0%
9.8%
10.5%
9.0%
NGR per day
661
559
602
655
647
* to 18 March 2015.
Average sports wagers per day have risen by 22% to 4.6 million in Q1-2015 compared to Q1-2014 (3.8 million). NGR per day has increased by 18% over the same period.
CONTRIBUTION
Contribution is GVC's measure of revenues less cost of sales, and costs with a high correlation to revenues, such as partner shares, affiliate commissions and other marketing expenditure. Cost of sales includes payment processing charges, software royalties and local betting taxes, and value added taxes where the Group has a manifest liability.
Contribution increased by 20% to 123.3 million, and a contribution margin percentage of 55% was achieved. (2013: Proforma contribution margin 56%).
EXPENDITURE
In the context of a growing business, absolute costs have increased from 64.3 million to 74.1 million, but cost ratios have improved to 60% down from 63%. Staff cost ratios remained level, despite one third of staff costs (2013: 20%) being performance related - chiefly based on Group dividend payments. This should be seen in the context of 33.6 million of dividends paid in 2014, an increase of 124% on the 15 million paid in 2013.
CLEAN EBITDA
The Group aims to achieve a clean EBITDA margin of not less than 20%.
Clean EBITDA rose 28.5% to 49.2 million (2013: 38.3 million), and a 22% margin on NGR was achieved, slightly higher than in 2013.
NON-CASH ITEMS OF AN ACCOUNTING NATURE
Depreciation of Property, Plant and Equipment rose in the year to 0.7 million (2013: 0.5 million) on total acquisitions of 0.9 million.
Amortisation of Intangible Assets amounted to 3.2 million (2013: 3.2 million) arising from either assets acquired through the Sportingbet acquisition or through the acquisition of additional software and software development costs required to run the Sportsbook platform.
Finance charges included an imputed debit (as per IAS 39) on the interest free loan from William Hill of 0.2 million. A rate of 4% has been used for the imputation. Other finance charges related to 0.7 million (2013: 1.7 million) on the unwinding of the discount on the deferred consideration arising from the 2009 acquisition of Betboo, 0.6 million on the retranslation of the GBP denominated William Hill loan and leased software assets and 67k (2013: 43k) in respect of finance charges on leased software assets.
Share option charges amounted to 0.7 million (2013: 0.7 million). The charge for 2014 represented the final accounting charges for the share options awarded in in 2010 and 2012, in addition to the charges arising from the share options awarded and announced on 2 June 2014. The Group has only 5.6 million share options granted to directors and officers (9.2% of the existing issued share capital although its permitted allocation is 16.8% of the issued share capital (page 354 of the January 2013 prospectus)). Of the charge in the current year, 0.5 million relates to equity settled options and 0.2 million relates to cash settled options with a corresponding liability recognised in the consolidated balance sheet.
Betit put option:The effect of valuing the Betit put option resulted in a 1.6 million charge in accordance with IAS 39 'Financial Instruments: Recognition and Measurement'.
EARNINGS PER SHARE
Table 3: Earnings per share
Basic EPS:
66.4 cents (2013: 22.5 cents)
Diluted EPS:
61.4 cents (2013: 22.0 cents)


The diluted EPS is affected by two components: grants of share options granted to employees and directors, and warrants granted to third parties pursuant to underwriting arrangements entered into in contemplation of the Sportingbet acquisition.
DIVIDENDS
Table 4: History of dividends paid and declared since 1 July 2013
Declaration date
Fiscal year 2013
Fiscal year
2014

Paid 2014
Payable 2015

cents
cents

cents
cents
1 July 2013
10.5
-

-
-
25 September 2013
10.5
-

-
-
9 January 2014
11.5
-

11.5
-
9 April 2014
16.0
-

16.0
-
15 July 2014
-
12.5

12.5
-
22 September 2014
-
15

15
-
12 January 2015
-
12.5

-
12.5
20 March 2015
-
15.5

-
15.5

48.5
55.5

55.0
28.0
As previously announced, the Group is committed to paying dividends on a quarterly basis and paying a cash amount broadly equivalent to 75% of its Clean Net Operating Cashflows, taking into account an assessment of its working capital needs. The actual percentages were 79% in 2014 and 72% in 2013. Details of the Clean Net Operating Cashflow calculation are included in table 6.
Should the relevant resolutions be approved by shareholders, the final and special dividends totaling 15.5 cents per share will be payable on 6 May 2015 to shareholders on the register at the close of business on Friday 10 April 2015. The shares will go ex-dividend on Thursday 9 April 2015. 
NET CURRENT (LIABILITIES)/ASSETS
The net position is obviously affected by the timing of the dividend payments, which totaled 33.6 million during 2014 (2013: 15.0 million). Such is the strategy of the Group towards its dividend payments that GVC aims to keep its Net Current Assets relatively equal to its Net Current Liabilities, but ensuring at all times that its balances with customers are covered and meet regulatory requirements.
Table 5: Liquidity position as at 31 December 2014

000's
000's
Restricted cash*

3,506
Add: cash in transit with payment processors

22,222
Total

25,728
Less: Customer balances

(13,036)
Surplus over customer liabilities

12,692
Free cash
14,323

Trade payables
(12,166)



2,157
Loan Instalments paid in 2014 to providers of lease finance

(1,362)
Loan instalment payable to William Hill in December 2014
(2,933)

Less imputed interest on William Hill loan
198



(2,735)
Corporate and other taxes reclaimable less payable

(1,089)
Other tax liabilities

(1,338)
Accruals, prepayments and other net current assets

(9,273)
Net current liabilities

(948)
* Restricted cash refers to balances at banks where the cash has to be ring-fenced for regulatory reasons.
SUMMARISED CASHFLOW
The Group's cashflow position for 2014 is summarised below:
Table 6: Summarised cashflow


2014

2013
000s
000s
000s
000s
Clean EBITDA
49,162
38,299
Exceptional items
-
(19,711)
Capitalised software development
(3,343)
(4)
Net payment of corporate taxes
(508)
(437)
Equipment purchased and asset lease repayments
(1,951)
(37)
Working capital and other movements
(742)
2,719*
CLEAN NET OPERATING CASHFLOWS ("CNOC")
42,618
20,829

Dividends paid
(33,607)
(14,979)
Dividends as a % of CNOC
79%
72%
OTHER CASHFLOWS




- Betboo earn-outs
(4,339)
(6,378)
- Investment in Betit
(3,649)
-
- Proceeds from exercise of share options
854
294





SPORTINGBET ACQUISITION CASHFLOWS 




- Capital contribution from William Hill
-
42,562
- William Hill loan (instalment)/draw-down
(2,856)
8,020
- Cash acquired from Sportingbet
-
22,230
- Bank loans to Sportingbet repaid at acquisition
-
(31,384)
- Deficit in other net current assets of Sportingbet at acquisition*
-

(29,018)

(2,856)
12,410
(979)
12,176
Cash and cash equivalents at the beginning of the year

18,808

6,632
Cash and cash equivalents at the end of the year 

17,829

18,808
Amount, in cents per share

29.1

30.7
*adjusted for the customer liabilities of 11.4 million acquired at acquisition.
NON-CURRENT LIABILITIES
These consist of four principal items; the deferred consideration on 2009 acquisition of Betboo; the interest-free loan from William Hill; finances leases; and the Betit put option.
a.) Deferred consideration on Betboo
Under accounting rules, this item is a combination of gross amounts payable, 4.0 million at 31 December 2014, and which can vary, but are subject to a cap, and the "unwinding of the discount", 0.1 million and chargeable to the Income Statement.
Table 7: Analysis of Betboo deferred consideration
 millions
Due to
Founders
Acquisition
costs
Sub
total
Accounting
discount
Total
Arising on acquisition
21.4
0.3
21.7
(8.6)
13.1
Charge to income statement
- prior to 2013
- during 2013
- due in 2014
- due in future periods
-
-
-
-
-
-
-
-
-
-
-
-
(6.1)
(1.7)
(0.7)
(0.1)
(6.1)
(1.7)
(0.7)
(0.1)
Payments made
- on acquisition
- up to 31.12.2012
- During 2013
2.8
3.8
6.4
0.3
-
-
3.1
3.8
6.4
-
-
-
3.1
3.8
6.4
- During 2014
4.3
-
4.3
-
4.3
Payments due
- In 2015
- In 2016
2.4
1.7
-
-
2.4
1.7
-
-
2.4
1.7
Lifetime balances
21.4
0.3
21.7
(8.6)
13.1






Balances due at 31.12.2014
4.0
-
4.0
(0.1)
3.9
b.) Interest free loan from William Hill
As part of the Sportingbet acquisition there was a loan facility from William Hill of up to 15 million. As at 1 January 2014 the balance stood at 6.9 million of which 2.3 million was repaid in the year. The balance of 4.6 million was revalued to 5.9 million using the exchange rate prevailing at 31 December 2014 of 1: 1.28. 2.3 million (2.9 million) is repayable in less than one year and thus accounted for as a current liability and the balance is shown on the balance sheet as a non-current liability. It is repayable in one further instalment due on 30 June 2016. Should GVC declare dividends in excess of 58 cents per share, William Hill are entitled to receive an accelerated repayment equal to the excess of the actual dividend over 58 cents per share. Whilst the loan is interest free, IAS 39 requires the Group to account for imputed interest calculated at 4%.
Table 8: William Hill loan recognised in non-current liabilities

2014
000's
Gross amount of loan payable after one year
2,934
Imputed interest
(157)
Amount recognised in non-current liabilities
2,777
c.) Finance leases
This represents the finance leases taken out for the purchase of software and similar underpinning the Sportsbook platform.
Table 9: Analysis of finance lease liabilities

2014
000's
2013
000's
Property, plant and equipment capitalised
644
543
Software capitalised
1,133
827

1,777
1,370
Hardware and software support to be expensed
951
753
Total amount financed
2,728
2,123
Finance charges 
110
43
Payments made
(1,149)
-
Total amounts repayable to provider of lease finance
1,689
2,166



Payable in 2015 (included in current liabilities)
1,362
945
Payable in future periods (included in non-current liabilities)
327
1,221

1,689
2,166



As identified in a, b, and c above, the Group has additional cash out flows. The anticipated amounts (plus those actually incurred in 2013 and 2014) are shown in table 10 below:
Table 10: Liability cash outflows
In 000's
2013
2014
2015
2016
a.) Betboo deferred consideration
6,378
4,339
2,400
1,617
b.) William Hill loan repayment*
-
2,856
2,933
2,934
c.) Existing finance leases
-
1,149
1,362
327

6,378
8,344
6,695
4,878
* in underlying GBP
-
2,287
2,287
2,287
d.) Betit
In accordance with the requirements of IAS 39, the options embedded in the Betit contract are required to be measured at fair value and recognised in the balance sheet. Based on the valuation at inception and at 31 December 2014, a net liability has been recognised of 1.7 million. The options are potentially exercisable, subject to certain conditions, in 2017 and are discussed in more detail below.
SUMMARY OF BALANCE SHEET MOVEMENTS
A bridge between the 2013 and 2014 balance sheets is shown below in table 11:

Table 11: Balance Sheet bridge


Total
000's
At 1 January 2014

141,096
Profit before tax
41,291

Tax charge
(728)



40,563
Share based payment charges on equity settled options

552
Share options exercised

854
Dividends paid

(33,607)
At 31 December 2014

149,458
During the year a total of 369,720 shares were issued. 26,667 shares were issued on 15 May 2014 for a consideration of 1.26 per share as a result of an exercise of Director's share options. 343,053 shares were issued on 1 July 2014 for a price of 1.89 per share as a result of an exercise of third party share options issued as part of the Sportingbet transaction in 2013.
TRADE INVESTMENT IN BETIT
On 14 May 2014, the Group announced that it had acquired a 15% stake in Betit Holdings Limited ('BHL'), a start-up gaming venture focusing on the Scandinavian markets headed up by a team of Scandinavian gaming market veterans from Betit Securities Limited ('BSL'). The stake was for 3.5 million, which, together with professional fees incurred at the time, amounted to a total upfront cost of 3.6 million. The investment was approved by the Maltese Gaming Authority (formerly known as the LGA) on 29 May 2014.
The Group has a call option to acquire the balance of the outstanding shares. The call option can be exercised no earlier than 1 July 2017 and no later than 30 September 2017, and would be subject to further MGA clearance and compliance with the AIM Rules. The minimum call option price is 70 million, and the actual price would be determined by the mix of revenues between regulated and non-regulated markets and certain multiples attaching thereto which at our prevailing multiple levels would lead to the transaction being accretive for shareholders.
If the Group decides not to exercise its call option BSL may require the Group to acquire its shares in BHL at a price determined by the mix of revenues between regulated and non-regulated markets and certain multiples thereof (but absent any floor on the price). Completion of this purchase would be subject to certain conditions including the Group raising the necessary financing. Should the Group not raise the required financing, BSL may acquire the Group's shares in BHL for nominal consideration.
Both of the above options are required to be carried at fair value in accordance with IAS 39. Commercially the put option can effectively be mitigated should the Company at that time not wish to acquire the full asset, by handing back the initial investment to BSL, yet this cannot be reflected in the fair value calculation although the fair value has been discounted to reflect this. Accordingly, the put valuation results in a modest non-cash impairment. The options are required to be revalued at each reporting date.
CURRENCY EXPOSURES
During the year, the charge to Operating Costs within the Income Statement from realised and unrealised foreign exchange was 0.3 million. In addition the William Hill loan is denominated in Sterling (4.6 million) and incurred an unrealised loss of 0.5 million included within Financial Expenses. Many non-Euro currencies are handled by the Group's payment processing intermediaries up-front.
Additionally, the Net Current Assets of the Group are revalued each month at month-end exchange rates and this also results in exchange gains and losses. The principal revaluations are for customer liabilities, although these are now largely currency matched to produce a natural hedge.
Future trading updates and financial calendar
It is anticipated that GVC will make further announcements on or around the following dates:
W/c 23 March 2015 - publication of Report and Accounts on the Company's website, www.gvc-plc.com
7 April 2015 - Posting of R&As and Notice of AGM
5 May 2015 - AGM Trading Update, Result of AGM
6 May 2015 - Payment of Final Dividend
W/c 6 July 2015 - H1 Trading Update and announcement of dividend
W/c 18 August 2014 - Payment of quarterly dividend
W/c 21 September 2015 - Interim Results
Richard Cooper
Group Finance Director
20 March 2015


CONSOLIDATED INCOME STATEMENT
for the year ended 31 December 2014




2014

2013


Notes

000's

000's
Net Gaming Revenue

2

224,801

169,959 
Cost of sales



(101,513)

(67,328)
Contribution

2

123,288

102,631 
Operating costs (as below)

3

(80,367)

(88,513)







Other operating costs

3

(74,126)

(64,332)
Share option charges

3

(736)

(730)
Exceptional items

3

-

(19,711)
Depreciation and amortisation

3

(3,912)

(3,740)
Effect of valuing the Betit put option



(1,593)

-







Operating profit



42,921

14,118 
Financial income



16

627 
Financial expense



(1,646)

(1,731)
Profit before tax



41,291

13,014 
Taxation expense



(728)

(711)
Profit after tax



40,563

12,303 







Earnings per share




Basic

4

0.664

0.225







Diluted

4

0.614

0.220
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 December 2014



2014

2013



000's

000's
Profit for the year


40,563

12,303
Other comprehensive income
Items that may subsequently be reclassified to profit or loss:





Exchange differences on translation of foreign operations


-

359
Total comprehensive income for the year
 

40,563

12,662 
CONSOLIDATED BALANCE SHEET
at 31 December 2014




2014

2013




000's

000's
Assets






Property, plant and equipment



1,147

918 
Intangible assets



154,260

153,850 
Available for sale financial asset



3,801

-
Deferred tax asset



-

-
Total non-current assets



159,208

154,768 







Trade and other receivables



27,605

23,579 
Income taxes reclaimable



3,925

1,877 
Other tax reclaimable



139

306 
Cash and cash equivalents



17,829

18,808 
Total current assets



49,498

44,570 







Current liabilities






Trade and other payables



(26,961)

(20,630)
Balances with customers



(13,036)

(13,298)
Interest bearing loans and borrowings



(1,362)

(945)
Non-interest bearing loan and borrowings



(2,735)

(2,514)
Income taxes payable



(5,014)

(2,722)
Other taxation payable



(1,338)

(4,182)
Total current liabilities



(50,446)

(44,291)







Current assets less current liabilities



(948)

279 







Non-current liabilities






Interest bearing loans and borrowings



(327)

(1,221)
Non-interest bearing loan and borrowings



(2,777)

(5,148)
Betit option liability



(1,745)

-
Deferred consideration on Betboo



(3,953)

(7,582)
Total non-current liabilities



(8,802)

(13,951)







Total net assets



149,458

141,096 







Capital and reserves






Issued share capital



613

609 
Merger reserve



40,407

40,407 
Share premium



85,380

84,530 
Translation reserve



359

359
Retained earnings



22,699

15,191 
Total equity attributable to equity holders of the parent



149,458

141,096 
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 December 2014
Attributable to equity holders of the parent company:

Share
 Capital
Merger Reserve
Share
Premium
Translation Reserve
Retained Earnings*
Total

000's
000's
000's
000's
000's
000's
Balance at 1 January 2013
316 
40,407 
611 
-
17,137 
58,471 







Share option charges
-
-
-
-
736 
736 
Share options cancelled
-
-
-
-
(6)
(6)
Share options exercised
3 
-
291 
-
-
294 
Issue of share capital for the acquisition of Sportingbet PLC
290 
-
83,628 
-
-
83,918 
Dividend paid
-
-
-
-
(14,979)
(14,979)
Transactions with owners
293 
-
83,919 
-
(14,249)
69,963 







Profit for the year
-
-
-
-
12,303 
12,303 
Other comprehensive income for the year
-
-
-
359
-
359
Total comprehensive income for the year
-
-
-
359
12,303
12,662
Balance as at 31 December 2013
609
40,407 
84,530 
359
15,191 
141,096 







Balance at 1 January 2014
609 
40,407 
84,530 
359
15,191 
141,096 







Share option charges**
-
-
-
-
552
552
Share options exercised
4
-
850
-
-
854
Dividend paid
-
-
-
-
(33,607)
(33,607)
Transactions with owners
4
-
850
-
(33,055)
(32,201)







Profit for the year
-
-
-
-
40,563
40,563
Other comprehensive income for the year
-
-
-
-
-
-
Total comprehensive income for the year
-
-
-
-
40,563
40,563
Balance as at 31 December 2014
613
40,407
85,380
359
22,699
149,458
* the cumulative share option reserve included within retained earnings at 31 December 2014 amounted to 5,940,000.
**total share option charge per the consolidated income statement amounted to 736,000 the difference being the cash settled share option expense of 184,000 which is not taken directly to retained earnings.
All reserves of the Company are distributable. Under The Isle of Man Companies Act 2006 distributions are not governed by reserves but by the Directors undertaking an assessment of the Company's solvency at the time of distribution.
CONSOLIDATED STATEMENT OF CASHFLOWS
For the year ended 31 December 2014



2014

2013



000's

000's
Cash flows from operating activities





Cash receipts from customers


221,048

173,885 
Cash paid to suppliers and employees


(172,668)

(181,592)
Corporate taxes recovered


1,256

1,143 
Corporate taxes paid


(1,740)

(1,580)
Net cash from operating activities


47,896

(8,144)






Cash flows from investing activities 





Interest received 


16

33 
Acquisition earn-out payments (Betboo)


(4,339)

(6,378)
Acquisition (net of cash acquired)


-

64,755 
Investment in Betit


(3,649)

-
Acquisition of property, plant and equipment


(802)

(37)
Capitalised development costs


(3,343)

(4)
Net cash from investing activities


(12,117)

58,369 






Cash flows from financing activities 





Non-interest bearing loan (from William Hill)


(2,856)

8,020 
Proceeds from issue of share capital


854

294 
Repayment of borrowings


(1,149)

(31,384)
Dividend paid 


(33,607)

(14,979)
Net cash from financing activities


(36,758)

(38,049)






Net (decrease)/increase in cash and cash equivalents 


(979)

12,176 
Cash and cash equivalents at beginning of the year


18,808

6,632 
Cash and cash equivalents at end of the year


17,829

18,808 


NOTES TO THE FINANCIAL STATEMENTS
1.  BASIS OF PREPARATION
The financial information, which comprises the consolidated statement income statement, the consolidated statement of comprehensive income, the consolidated balance sheet , the consolidated statement of changes in equity, the consolidated statement of cashflows and the related notes, is derived from the Group financial statements for the year ended 31 December 2014, which have been prepared under International Financial Reporting Standards as adopted by the European Union (IFRS) and those parts of the Isle of Man Companies Act 2006 applicable to companies reporting under IFRS. It does not constitute full accounts within the meaning of the Isle of Man Companies Act 2006. This financial information has been agreed with the auditors for release.
The financial statements are presented in the Euro, rounded to the nearest thousand, and are prepared on the historical cost basis with the exception of those assets and liabilities carried at fair value. The financial statements are prepared on the going concern basis.
Fair value is the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date, regardless of whether that price is directly observable or estimated using another valuation technique. In estimating the fair value of an asset or a liability, the Group takes into account the characteristics of the asset or liability if market participants would take those characteristics into account when pricing the asset or liability at the measurement date. Fair value for measurement and/or disclosure purposes in these consolidated financial statements is determined on such a basis, except for share-based payment transactions that are within the scope of IFRS 2, leasing transactions that are within the scope of IAS 17, and measurements that have some similarities to fair value but are not fair value, such as net realisable value in IAS 2 or value in use in IAS 36.
The preparation of financial statements in conformity with IFRSs requires directors to make judgements, estimates and assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and associated assumptions are based on various factors that are believed to be reasonable under the circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily apparent from other sources. Actual results may differ from these estimates. 
The estimates and underlying assumptions are reviewed on an ongoing basis. Revisions to accounting estimates are recognised in the period in which the estimate is revised if the revision affects only that period or in the period of the revision and future periods if the revision affects both current and future periods.
Certain prior year information has been restated. 
The Group has restated the Consolidated Income statement to reflect income from customers previously netted-off with cost of sales, the impact of which is shown in the table below:
Year ended 31 December 2013
Original
Restatements
Restated

000's
000's
000's
Revenue
168,407
1,552
169,959
Cost of sales
(65,776)
(1,552)
(67,328)
Contribution
102,631
-
102,631
The Group has restated the Consolidated Statement of Cashflows for the year ended 31 December 2013. The non-interest bearing loan from William Hill is now reflected in financing activities rather than investing activities. This has revised net cash from investing activities in 2013 to 58,369,000 from the previously stated 66,389,000 and net cash from financing activities to (38,049,000) from the previously stated (46,069,000).
2. SEGMENTAL REPORTING
Management follows one business line with two operating segments, being Sports and Gaming segmenting the revenues. These operating segments are monitored and strategic decisions are made on the basis of overall operating results.
Management also monitors revenue by geographic location of its customers, monitoring performance in Europe and Latin America.
2.1 Geographical Analysis
The Group's revenues and other income from external customers are divided into the following geographic areas:



2014
2013



000's
000's
Europe


197,442
148,010
Latin America and Emerging Markets


27,359
21,949
Total


224,801
169,959
The total non-current assets (other than financial instruments, investments accounted for using the equity method, deferred tax assets and post-employment benefit assets) located in Europe is 148,454,000 (2013: 146,381,000) and the total located in other regions is 10,754,000 (2013: 8,387,000).


2.2 Reporting by Segment
The total deferred tax asset located in Europe is nil (2013: nil). There are no deferred tax assets in other regions.
Revenues from external customers in the Group's domicile, Europe, as well as its major markets, Europe and Latin America, have been identified on the basis of the customer's geographical location. Non-current assets are allocated based on their physical location. 



2014
2013


Notes
000's
000's
STATEMENT OF REVENUE




Sports wagers


1,463,523 
1,169,505 
Sports margin


9.8%
9.6%
Gross margin


143,544
112,081 





Sports NGR


110,199
90,823 
Gaming NGR


114,602
91,302 



224,801
182,125 
Revenue recognised by GVC


224,801
169,959 
Revenue recognised by B2B partners (up until 19 March 2013)


-
12,166 
Proforma Revenue


224,801
182,125 





SEGMENTAL REPORTING




Net Gaming Revenue 


224,801
169,959 
Variable costs


(101,513)
(67,328)
Contribution


123,288
102,631 
Contribution margin


55%
60%
Proforma contribution margin


55%
56%
Other operating costs 

3


Personnel expenditure


(43,055)
(32,507)
Professional fees


(4,489)
(2,523)
Technology costs


(20,991)
(19,795)
Office, travel and other costs


(5,248)
(5,146)
 Third party service costs


(3)
(2,427)
 Foreign exchange differences


(340)
(1,934)
Clean EBITDA


49,162
38,299 
Exceptional items 

3
-
(19,711)
Share option charges

3
(736)
(730)
Effect of valuing the Betit put option


(1,593)
-
EBITDA


46,833
17,858 
Depreciation and amortisation

3
(3,912)
(3,740)
Financial income 


16
627
Financial expense


(869)
(11)
Finance lease interest 


(67)
(43)
Unwinding of discount on deferred consideration 


(710)
(1,677)
Profit before tax


41,291
13,014 
Taxation


(728)
(711)
Profit after tax from continuing operations


40,563
12,303 





NET ASSETS




Non-current assets


159,208
154,768 
Current assets


49,498
44,570 
Current liabilities


(50,446)
(44,291)
Net current (liabilities)/assets


(948)
279 
Non-current liabilities


(8,802)
(13,951)
Net assets


149,458
141,096 
Total assets


208,706
199,338 
Total liabilities


(59,248)
(58,242)


2.3 Performance Summary by six month period





Total




000's
000's
Revenue





H2-2014



119,735

H1-2014



105,066

FY-2014




224,801
H2-2013



96,777

H1-2013



73,182

FY-2013




169,959






Contribution





H2-2014



66,566

H1-2014



56,722

FY-2014




123,288
H2-2013



57,081

H1-2013



45,550

FY-2013




102,631






Clean EBITDA





H2-2014



26,808

H1-2014



22,354

FY-2014




49,162
H2-2013



20,499

H1-2013



17,800

FY-2013




38,299
3. OPERATING COSTS




2014

2013



Notes

000's

000's
Wages and salaries, including Directors (excluding incentive schemes)




21,744

18,227
Incentive schemes, including Directors




13,865

6,549
Amounts paid to long term contractors




3,270

3,763
Compulsory social security contributions




2,137

1,794
Compulsory pension contributions




627

751
Health and other benefits




758

701
Recruitment and training




654

722
Personnel expenditure (excluding share option charges)




43,055

32,507
Professional fees




4,489

2,523 
Technology costs




20,991

19,795
Office, travel and other costs




5,251

5,146
Third party service costs*




-

2,427
Foreign exchange differences




340

1,934
Other operating costs




74,126

64,332








Equity settled share option charges




552

730
Cash settled share option charges




184

-
Exceptional items


3.1

-

19,711 
Effect of valuing the Betit put option




1,593

-
Depreciation




675

504 
Amortisation




3,237

3,236





80,367

88,513
*provided to Betboo by external providers


3.1 Exceptional Items
The Group incurred expenditure on exceptional items of nil (2013: 19,711,000). These are items which are both exceptional in size and nature.



2014
2013


Notes
000's
000's
Costs arising on the acquisition of Sportingbet PLC




- Legal advice

a
-
3,428 
- Nominated adviser 

a
-
1,210 
- Reporting accountants

a
-
938 
- Other professional fees

a
-
822 
Total of professional fees


-
6,398 
- Underwriting

a
-
810 
- Stamp duty and stock exchange fees

a
-
639 
- Transaction success bonuses 

a
-
1,444
Transaction costs


-
9,291 





Redundancies, retentions and similar

a
-
9,017 
Contract buyouts

a
-
2,855
Restructuring costs


-
11,872





Economic benefit from the management of the Sportingbet Spanish business

b
-
(1,452)








-
19,711 
Note a: On 19 March 2013, the Group completed the acquisition of Sportingbet PLC. Professional fees attributable to the acquisition and subsequent costs restructuring the Sportingbet business were treated as exceptional items. Professional fees associated with the acquisition and incurred by Sportingbet amounted to 7,847,000. These were included in the acquisition balance sheet as liabilities.
Note b: As part of the Group's acquisition of Sportingbet PLC, a call option was granted to William Hill PLC over certain assets of Sportingbet's Spanish business. The call option assets were: 
(i) the Spread Your Wings Spain PLC ("SYWS") Customer List; 
(ii) the SYWS Customer Balances; 
(iii) the entire issued share capital of SYWS; and 
(iv) the entire issued share capital of Asesores en Tecnologa y Diseo, S.L. ("ATD"). 
William Hill exercised the call option over all of the call option assets, as a result the Group was entitled to receive the economic benefit of the assets until 16 September 2013. The Group does not consider that it exercised control over the Spanish business in the prior period and its results were therefore not consolidated. The benefit to the Group arising from the management fee earned in the prior period was shown as exceptional income.
4. EARNINGS PER SHARE
4.1 Basic Earnings Per Share and Basic Earnings Per Share Before Exceptional Items
Basic earnings per share has been calculated by taking the profit attributable to ordinary shareholders and dividing by the weighted average number of shares in issue. Basic earnings per share from continuing operations before exceptional items has been calculated by taking the profit attributable to ordinary shareholders and adding back the cost of exceptional items in the year and dividing by the weighted average number of shares in issue.


2014
2013
Profit for the year attributable to ordinary shareholders

40,563,268
12,303,000 
Weighted average number of shares

61,099,894
54,586,391 
Basic earnings per share (in )

0.664
0.225 
Exceptional items

-
19,711,000 
Profit for the year attributable to ordinary shareholders before exceptional items

40,563,268
32,014,000 
Basic earnings per share before exceptional items (in )

0.664
0.586 
4.2 Diluted Earnings Per Share and Diluted Earnings Per Share Before Exceptional Items
Diluted earnings per share has been calculated by taking the profit attributable to ordinary shareholders and dividing by the weighted average number of shares in issue as diluted by share options. Diluted earnings per share from continuing operations before exceptional items has been calculated by taking the profit attributable to ordinary shareholders and adding back the cost of exceptional items and dividing by the weighted average number of shares in issue, as diluted by share options.


2014
2013
Profit for the year attributable to ordinary shareholders

40,563,268
12,303,000 
Weighted average number of shares

61,099,894
54,586,391
Effect of dilutive share options

5,010,290
1,419,914 
Weighted average number of dilutive shares

66,110,184
56,006,305 
Diluted earnings per share (in )

0.614
0.220 
Exceptional items

-
19,711,000 
Profit for the year attributable to ordinary shareholders before exceptional items

40,563,268
32,014,000 
Diluted earnings per share before exceptional items (in )

0.614
0.572 

This information is provided by RNS
The company news service from the London Stock Exchange
  END
FR EAPDEASDSEFF