REG - Experian plc - Preliminary Results for year ended 31st March 2015 <Origin Href="QuoteRef">EXPN.L</Origin> - Part 2
15/07/2015 17:06
- Part 2: For the preceding part double click ID:nRSL8460Ma
incentive plans 47 70
Operating cash flow 1,359 1,321
Net interest paid (74) (74)
Tax paid - continuing operations (145) (174)
Dividends paid to non-controlling interests (5) (6)
Free cash flow 1,135 1,067
Cash outflow for exceptional restructuring costs (12) (65)
Acquisitions (67) (1,250)
Disposal of businesses and investments 16 27
Ordinary dividends paid (374) (349)
Net cash inflow/(outflow) - continuing operations 698 (570)
Net debt at 1 April (3,809) (2,938)
Net share purchases (192) (371)
Exchange, discontinued operations and other movements 86 70
Net debt at 31 March (3,217) (3,809)
5. Reconciliation of amortisation, depreciation and impairment charges
Year ended 31 March 2015 2014
US$m US$m
As reported in the Group income statement 518 524
Less: amortisation and impairment of acquisition intangibles (134) (131)
Less: exceptional asset write-off - (7)
Less: impairment of goodwill - (15)
As reported in the cash flow and Net debt summary 384 371
Group income statement
for the year ended 31 March 2015
Notes 2015 2014
US$m US$m
Revenue 5 4,810 4,840
Labour costs (1,799) (1,830)
Data and information technology costs (470) (481)
Amortisation, depreciation and impairment charges (518) (524)
Marketing and customer acquisition costs (365) (405)
Other operating charges (501) (506)
Total operating expenses (3,653) (3,746)
Operating profit 1,157 1,094
Interest income 25 22
Finance expense (181) (69)
Net finance costs 9(a) (156) (47)
Share of post-tax profit of associates 5 2
Profit before tax 5 1,006 1,049
Group tax charge 10(a) (255) (302)
Profit for the financial year from continuing operations 751 747
Profit for the financial year from discontinued operations 11(a) 21 7
Profit for the financial year 772 754
Attributable to:
Owners of Experian plc 772 753
Non-controlling interests - 1
Profit for the financial year 772 754
Notes US cents US cents
Earnings per share
Basic 12(a) 79.0 76.8
Diluted 12(a) 78.1 75.8
Earnings per share from continuing operations
Basic 12(a) 76.9 76.1
Diluted 12(a) 76.0 75.1
Notes US cents US cents
Non-GAAP information:
Full year dividend per share 13(a) 39.25 37.50
Group statement of comprehensive income
for the year ended 31 March 2015
2015 2014
US$m US$m
Profit for the financial year 772 754
Other comprehensive income
Items that will not be reclassified to profit or loss:
Remeasurement of post-employment benefit assets and obligations (15) (14)
Deferred tax credit 3 4
Items that will not be reclassified to profit or loss (12) (10)
Items that may be reclassified subsequently to profit or loss:
Fair value (losses)/gains recognised on available-for-sale financial assets (1) 5
Currency translation losses (571) (188)
Items that may be reclassified subsequently to profit or loss (572) (183)
Items reclassified to profit or loss:
Reclassification of fair value gain on available-for-sale financial assets (2) -
Reclassification of cumulative currency translation gain in respect of divestments - (2)
Items reclassified to profit or loss (2) (2)
Other comprehensive income for the financial year1 (586) (195)
Total comprehensive income for the financial year 186 559
Attributable to:
Continuing operations 166 552
Discontinued operations 21 7
Owners of Experian plc 187 559
Non-controlling interests (1) -
Total comprehensive income for the financial year 186 559
559
1. Amounts reported within other comprehensive income are in respect of continuing operations and, except as reported
for post-employment benefit assets and obligations, there is no associated tax. Currency translation items are taken
directly to the translation reserve within other reserves. Other items within other comprehensive income are taken directly
to retained earnings.
Non-GAAP measures:
Reconciliation of profit before tax to Benchmark PBT
for the year ended 31 March 2015
Notes 2015 2014
US$m US$m
Profit before tax 5 1,006 1,049
Exceptional items 7 2 54
Amortisation and impairment of acquisition intangibles 8 134 131
Impairment of goodwill 8 - 15
Acquisition expenses 8 1 10
Adjustment to the fair value of contingent consideration 8 7 -
Financing fair value remeasurements 8 81 (27)
Benchmark PBT 5 1,231 1,232
Notes US cents US cents
Benchmark PBT per share 126.0 125.7
Benchmark earnings per share
Basic 12(a) 95.2 91.7
Diluted 12(a) 94.1 90.5
Group balance sheet
at 31 March 2015
Notes 2015 2014
US$m US$m
Non-current assets
Goodwill 4,393 4,807
Other intangible assets 14 1,624 1,869
Property, plant and equipment 14 390 469
Investments in associates 8 13
Deferred tax assets 264 460
Post-employment benefit assets 15(a) 58 74
Trade and other receivables 10 9
Available-for-sale financial assets 40 46
Other financial assets 125 229
6,912 7,976
Current assets
Inventories 3 2
Trade and other receivables 878 942
Current tax assets 29 13
Other financial assets 8 27
Cash and cash equivalents 16(g) 147 212
1,065 1,196
Current liabilities
Trade and other payables (1,122) (1,168)
Borrowings 18(b) (146) (584)
Current tax liabilities (91) (91)
Provisions (31) (54)
Other financial liabilities (14) (5)
(1,404) (1,902)
Net current liabilities (339) (706)
Total assets less current liabilities 6,573 7,270
Non-current liabilities
Trade and other payables (33) (52)
Borrowings 18(b) (3,146) (3,576)
Deferred tax liabilities (385) (412)
Post-employment benefit obligations 15(a) (60) (61)
Other financial liabilities (148) (65)
(3,772) (4,166)
Net assets 2,801 3,104
Equity
Called up share capital 20 103 103
Share premium account 20 1,506 1,492
Retained earnings 18,523 18,167
Other reserves (17,346) (16,680)
Attributable to owners of Experian plc 2,786 3,082
Non-controlling interests 15 22
Total equity 2,801 3,104
Group statement of changes in total equity
for the year ended 31 March 2015
Called up share capital (Note 20) Share premium account(Note 20) Retained earnings Other reserves Attributable to owners of Experian plc Non-controlling interests Total equity
US$m US$m US$m US$m US$m US$m US$m
At 1 April 2014 103 1,492 18,167 (16,680) 3,082 22 3,104
Profit for the financial year - - 772 - 772 - 772
Other comprehensive income for the financial year - - (15) (570) (585) (1) (586)
Total comprehensive income for the financial year - - 757 (570) 187 (1) 186
Transactions with owners:
Employee share incentive plans:
- value of employee services - - 47 - 47 - 47
- shares issued on vesting - 14 - - 14 - 14
- other exercises of share awards and options - - (104) 112 8 - 8
- related tax credit - - 30 - 30 - 30
- purchase of shares by employee trusts - - - (38) (38) - (38)
- other payments - - (6) - (6) - (6)
Purchase of shares held as treasury shares - - - (170) (170) - (170)
Transactions in respect of non-controlling interests - - 6 - 6 (1) 5
Dividends paid - - (374) - (374) (5) (379)
Transactions with owners - 14 (401) (96) (483) (6) (489)
At 31 March 2015 103 1,506 18,523 (17,346) 2,786 15 2,801
for the year ended 31 March 2014
Called up share capital (Note 20) Share premium account(Note 20) Retained earnings Other reserves Attributable to owners of Experian plc Non-controlling interests Total equity
US$m US$m US$m US$m US$m US$m US$m
At 1 April 2013 102 1,480 17,849 (16,247) 3,184 40 3,224
Profit for the financial year - - 753 - 753 1 754
Other comprehensive income for the financial year - - (5) (189) (194) (1) (195)
Total comprehensive income for the financial year - - 748 (189) 559 - 559
Transactions with owners:
Employee share incentive plans:
- value of employee services - - 70 - 70 - 70
- shares issued on vesting 1 12 - - 13 - 13
- other exercises of share awards and options - - (132) 85 (47) - (47)
- related tax credit - - 4 - 4 - 4
- purchase of shares by employee trusts - - - (126) (126) - (126)
- other payments - - (7) - (7) - (7)
Purchase of shares held as treasury shares - - - (203) (203) - (203)
Transactions with non-controlling interests - - (16) - (16) (12) (28)
Dividends paid - - (349) - (349) (6) (355)
Transactions with owners 1 12 (430) (244) (661) (18) (679)
At 31 March 2014 103 1,492 18,167 (16,680) 3,082 22 3,104
Group cash flow statement
for the year ended 31 March 2015
Notes 2015 2014
US$m US$m
Cash flows from operating activities
Cash generated from operations 16(a) 1,720 1,641
Interest paid (96) (95)
Interest received 22 21
Dividends received from associates 4 1
Tax paid 16(d) (145) (174)
Net cash inflow from operating activities - continuing operations 1,505 1,394
Net cash inflow from operating activities - discontinued operations 11(a) 32 140
Net cash inflow from operating activities 1,537 1,534
Cash flows from investing activities
Purchase of other intangible assets (316) (319)
Purchase of property, plant and equipment (64) (83)
Sale of property, plant and equipment 2 8
Sale/(purchase) of other financial assets 7 (3)
Acquisition of subsidiaries, net of cash acquired 16(e) (58) (1,223)
Disposal of subsidiaries - continuing operations 18 25
Disposal of subsidiaries - discontinued operations 11(b) (9) 5
Net cash flows used in investing activities (420) (1,590)
Cash flows from financing activities
Cash inflow in respect of net share purchases 16 13
Cash outflow in respect of net share purchases (208) (384)
Other payments on vesting of share awards (6) (7)
Payments to acquire non-controlling interests 16(e) (8) (19)
New borrowings - 1,911
Repayment of borrowings (539) (1,144)
Net (payments)/receipts for derivative financial instruments held to manage currency profile (2) 43
Net receipts from equity swaps 2 5
Dividends paid (379) (355)
Net cash flows (used in)/from financing activities (1,124) 63
Net (decrease)/increase in cash and cash equivalents (7) 7
Cash and cash equivalents at 1 April 208 226
Exchange movements on cash and cash equivalents (56) (25)
Cash and cash equivalents at 31 March 16(g) 145 208
Notes to the financial statements
for the year ended 31 March 2015
1. Corporate information
Experian plc (the 'Company') is the ultimate parent company of the Experian group of companies ('Experian' or the 'Group').
The Company is incorporated and registered in Jersey as a public company limited by shares and is resident in Ireland. The
Company's ordinary shares are traded on the London Stock Exchange's Regulated Market (Premium Listing).
2. Basis of preparation
The financial information set out in this preliminary announcement does not constitute the Group's statutory financial
statements, which comprise the annual report and audited financial statements, for the years ended 31 March 2015 or 31
March 2014 but is derived from the statutory financial statements for the year ended 31 March 2015. The Group's statutory
financial statements for the year ended 31 March 2015 will be made available to shareholders in June 2015 and delivered to
the Jersey Registrar of Companies in due course. The auditors have reported on those financial statements and have given an
unqualified report which does not contain a statement under Article 111(2) or Article 111(5) of the Companies (Jersey) Law
1991. The Group's statutory financial statements for the year ended 31 March 2014 have been delivered to the Jersey
Registrar of Companies. The auditors reported on those financial statements and gave an unqualified report which did not
contain a statement under Article 111(2) or Article 111(5) of the Companies (Jersey) Law 1991.
The Group's statutory financial statements for the year ended 31 March 2015 have been:
· prepared in accordance with the Companies (Jersey) Law 1991 and International Financial Reporting Standards ('IFRS'
or 'IFRSs') as adopted for use in the European Union and IFRS Interpretations Committee interpretations;
· prepared on a going concern basis and under the historical cost convention, as modified for the revaluation of
available-for-sale financial assets and certain other financial assets and financial liabilities;
· presented in US dollars, the most representative currency of the Group's operations, and generally rounded to the
nearest million; and
· prepared using the principal exchange rates set out on page 14.
Other than those disclosed in this preliminary announcement, no significant events impacting the Group have occurred
between 31 March 2015 and 11 May 2015 when this preliminary announcement was approved for issue.
This preliminary announcement has been prepared in accordance with the Listing Rules of the UK Financial Conduct Authority,
using the accounting policies applied in the preparation of the Group's statutory financial statements for the year ended
31 March 2015. Those policies were published in full in the Group's statutory financial statements for the year ended 31
March 2014 and are available on a corporate website, at www.experianplc.com/annualreport.
Notes to the financial statements (continued)
for the year ended 31 March 2015
3. Recent accounting developments
There have been no accounting standards, amendments and interpretations effective for the first time in these financial
statements and which have had a material impact on the financial statements.
The information below is a summary of other recent external accounting developments. We routinely review these and adapt
our financial reporting systems and processes as appropriate. Other than IFRS 9 and IFRS 15, none of these developments is
currently expected to have a significant impact on the Group.
The following accounting standards, amendments and interpretations are effective for the first time for the Group's
accounting periods beginning on or after 1 April 2015:
· Amendments to IAS 19 'Defined benefit plans: employee contributions'';
· Annual improvements to IFRSs 2010-2012 cycle; and
· Annual improvements to IFRSs 2011-2013 cycle.
There are a number of other new standards and amendments to existing standards currently in issue but not yet effective,
including two significant standards:
· IFRS 9 'Financial instruments', issued in final form in July 2014 following the completion of its phased release;
and
· IFRS 15 'Revenue from contracts with customers'.
IFRS 9 is, and IFRS 15 is expected to be, effective for Experian for the year ending 31 March 2019 (subject to EU
endorsement). We are assessing their impact and, in the case of IFRS 15, this includes a systematic review of existing
major contracts to ensure that the impact of the new standard is fully understood and changes to financial reporting
systems are made in advance of the effective date. It is not however not practicable to quantify the effect of these two
standards at the date of approval of these financial statements. There are no other new standards, amendments to existing
standards or interpretations that are not yet effective that would be expected to have a material impact on the Group
financial statements.
Notes to the financial statements (continued)
for the year ended 31 March 2015
4. Use of non-GAAP measures in the financial statements
As detailed below, the Group has identified and defined certain measures that it believes assist understanding of
Experian's performance. The measures are not defined under IFRS and they may not be directly comparable with other
companies' adjusted measures. The non-GAAP measures are not intended to be a substitute for, or superior to, any IFRS
measures of performance but management has included them as they consider them to be key measures used within the business
to assess performance.
(a) Benchmark profit before tax ('Benchmark PBT')
Benchmark PBT is disclosed to indicate the underlying profitability of the Group. It is defined as profit before
amortisation and impairment of acquisition intangibles, impairment of goodwill, acquisition expenses, adjustments to
contingent consideration, exceptional items, financing fair value remeasurements, tax and discontinued operations. It
includes the Group's share of continuing associates' pre-tax results.
An explanation of the basis on which Experian reports exceptional items is provided below. Other adjustments made to derive
Benchmark PBT are explained as follows:
· Charges for the amortisation and impairment of acquisition intangibles are excluded from the definition of Benchmark
PBT because such charges are based on judgments about their value and economic life. Impairment of goodwill is similarly
excluded from the definition of Benchmark PBT.
· Acquisition expenses are excluded from the definition of Benchmark PBT as they bear no relation to the Group's
underlying performance or to the performance of the acquired businesses. Adjustments to contingent consideration are
similarly excluded from the definition of Benchmark PBT.
· Charges and credits for financing fair value remeasurements within finance expense in the Group income statement are
excluded from the definition of Benchmark PBT. These relate to that element of the Group's derivatives that is ineligible
for hedge accounting together with gains and losses on put options in respect of acquisitions. Amounts recognised generally
arise from market movements and accordingly bear no direct relation to the Group's underlying performance.
(b) Benchmark PBT per share
Benchmark PBT per share comprises Benchmark PBT divided by the weighted average number of issued ordinary shares.
(c) Earnings before interest and tax ('EBIT')
EBIT is defined as Benchmark PBT before the net interest expense charged therein.
(d) Earnings before interest, tax, depreciation and amortisation ('EBITDA')
EBITDA is defined as EBIT before the depreciation and amortisation charged therein.
(e) Discontinuing activities
Discontinuing activities are businesses sold, closed or identified for closure during a financial year. These are treated
as discontinuing activities for both revenue and EBIT purposes. The results of discontinuing activities are disclosed
separately with the results of the prior period re-presented as appropriate. This measure differs from the definition of
discontinued operations set out in IFRS 5.
(f) Continuing activities
Businesses trading at 31 March 2015, which are not disclosed as discontinuing activities, are treated as continuing
activities.
(g) Constant exchange rates
To highlight its organic performance, Experian discusses its results in terms of growth at constant exchange rates, unless
otherwise stated. This represents growth calculated after translating both years' performance at the prior year's average
exchange rates.
(h) Total growth
This is the year-on-year change in the performance of Experian's activities. Total growth at constant exchange rates
removes the translational foreign exchange effects arising on the consolidation of Experian's activities.
(i) Organic revenue growth
This is the year-on-year change in the revenue of continuing activities, translated at constant exchange rates, excluding
acquisitions until the first anniversary of their consolidation.
Notes to the financial statements (continued)
for the year ended 31 March 2015
4. Use of non-GAAP measures in the financial statements (continued)
(j) Benchmark earnings and Overall benchmark earnings
Benchmark earnings comprise Benchmark PBT less attributable tax and non-controlling interests. Benchmark earnings
attributable to non-controlling interests comprise that portion of Benchmark earnings that relates to non-controlling
interests. Benchmark PBT less attributable tax is designated as Overall benchmark earnings. The attributable tax for this
purpose excludes significant tax credits and charges arising in the year which, in view of their size or nature, are not
comparable with previous years, together with tax arising on exceptional items and on total adjustments made to derive
Benchmark PBT.
(k) Benchmark earnings per share ('Benchmark EPS')
Benchmark EPS comprises Benchmark earnings divided by the weighted average number of issued ordinary shares.
(l) Benchmark tax charge and rate
The Benchmark tax charge is the tax charge applicable to Benchmark PBT. It differs from the Group tax charge by tax
attributable to exceptional items and other adjustments made to derive Benchmark PBT, and exceptional tax charges. A
reconciliation is provided in note 10(b) to the financial statements. The related effective rate of tax is calculated by
dividing the Benchmark tax charge by Benchmark PBT
(m) Exceptional items
The separate reporting of non-recurring exceptional items gives an indication of the Group's underlying performance.
Exceptional items are those arising from the profit or loss on disposal of businesses, closure costs of major business
units and costs of significant restructuring programmes. All other restructuring costs are charged against EBIT, in the
segments in which they are incurred.
(n) Operating and Free cash flow
Operating cash flow is EBIT from continuing operations, plus amortisation, depreciation and charges in respect of
share-based incentive plans, less capital expenditure net of disposal proceeds and adjusted for changes in working capital
and the profit or loss retained in continuing associates. Free cash flow is derived from Operating cash flow by excluding
net interest, tax paid in respect of continuing operations and dividends paid to non-controlling interests.
(o) Cash flow conversion
Cash flow conversion is Operating cash flow expressed as a percentage of EBIT.
(p) Net debt
Net debt is borrowings (and the fair value of derivatives hedging borrowings) excluding accrued interest, less cash and
cash equivalents reported in the Group balance sheet and other highly liquid bank deposits with original maturities greater
than three months.
Notes to the financial statements (continued)
for the year ended 31 March 2015
5. Segment information
(a) Income statement
North America Latin America UK & Ireland EMEA/Asia Pacific1 Total operating segments CentralActivities Total continuing operations
Year ended 31 March 2015 US$m US$m US$m US$m US$m US$m US$m
Revenue from external customers
Continuing activities 2,468 857 999 486 4,810 - 4,810
Discontinuing activities - - - - - - -
Total 2,468 857 999 486 4,810 - 4,810
Reconciliation from EBIT to profit/(loss) before tax
EBIT
Continuing activities 761 313 314 (1) 1,387 (81) 1,306
Discontinuing activities - - - - - - -
Total 761 313 314 (1) 1,387 (81) 1,306
Net interest (note 9(b)) - - - - - (75) (75)
Benchmark PBT 761 313 314 (1) 1,387 (156) 1,231
Exceptional items (note 7) - (2) - - (2) - (2)
Amortisation of acquisition intangibles (74) (37) (14) (9) (134) - (134)
Acquisition expenses - - (1) - (1) - (1)
Adjustment to the fair value of contingent consideration - - (7) - (7) - (7)
Financing fair value remeasurements - - - - - (81) (81)
Profit/(loss) before tax 687 274 292 (10) 1,243 (237) 1,006
North America Latin America UK & Ireland EMEA/Asia Pacific1 Total operating segments CentralActivities Total continuing operations
Year ended 31 March 2014 US$m US$m US$m US$m US$m US$m US$m
Revenue from external customers
Continuing activities 2,404 925 944 499 4,772 - 4,772
Discontinuing activities - 21 - 47 68 - 68
Total 2,404 946 944 546 4,840 - 4,840
Reconciliation from EBIT to profit/(loss) before tax
EBIT
Continuing activities 757 344 284 7 1,392 (83) 1,309
Discontinuing activities - - - (3) (3) - (3)
Total 757 344 284 4 1,389 (83) 1,306
Net interest (note 9(b)) - - - - - (74) (74)
Benchmark PBT 757 344 284 4 1,389 (157) 1,232
Exceptional items (note 7) (27) (8) (12) (7) (54) - (54)
Amortisation and impairment of acquisition intangibles (50) (48) (14) (19) (131) - (131)
Impairment of goodwill (note 8) - - - (15) (15) - (15)
Acquisition expenses (9) - - (1) (10) - (10)
Financing fair value remeasurements - - - - - 27 27
Profit/(loss) before tax 671 288 258 (38) 1,179 (130) 1,049
1. EMEA/Asia Pacific represents all other operating segments.Additional information by operating segment, including that on total and organic growth at constant exchange rates, is provided within pages 3 to 11.
Notes to the financial statements (continued)
for the year ended 31 March 2015
5. Segment information (continued)
(b) Revenue by country - continuing operations
2015 2014
US$m US$m
USA 2,453 2,391
Brazil 763 819
UK 992 936
Colombia 73 94
Other 529 600
4,810 4,840
Revenue is primarily attributable to countries other than Ireland. No single client accounted for 10% or more of revenue in
the current or prior year.
(c) Revenue by business segment - continuing operations
The additional analysis of revenue from external customers provided to the chief operating decision-maker and accordingly
reportable under IFRS 8 is given within note 6. This is supplemented by voluntary disclosure of the profitability of groups
of service lines. For ease of reference, Experian continues to use the term 'business segments' when discussing the results
of groups of service lines.
Notes to the financial statements (continued)
for the year ended 31 March 2015
6. Information on business segments (including non-GAAP disclosures)
Credit Services DecisionAnalytics Marketing Services Consumer Services Total business segments CentralActivities Total continuing operations
Year ended 31 March 2015 US$m US$m US$m US$m US$m US$m US$m
Revenue from external customers
Continuing activities 2,366 594 870 980 4,810 - 4,810
Discontinuing activities - - - - - - -
Total 2,366
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