REG - Sports Direct Intl. - Preliminary Results for Year Ended 30 April 2017 <Origin Href="QuoteRef">SPD.L</Origin> - Part 2
20/07/2017 07:06
- Part 2: For the preceding part double click ID:nRST5703La
30 April 2017(pence per share) 24 April 2016(pence per share) Change (%)
Reported EPS (Basic) 39.4 46.8 (15.8)
Underlying EPS 11.4 35.5 (67.9)
Weighted average number of shares (actual) 583,501,473 592,573,254 (1.5)
Basic earnings per share (EPS) is calculated by dividing the earnings
attributable to ordinary shareholders by the weighted average number of
ordinary shares outstanding during the actual financial period. Shares held in
Treasury and the Employee Benefit Trust are excluded from this figure.
The underlying EPS reflects the underlying performance of the business
compared with the prior year and is calculated using the weighted average
number of shares. It is not a recognised profit measure under IFRS and may not
be directly comparable with "adjusted" profit measures used by other
companies.
The items adjusted for arriving at the underlying profit after tax and
minority interests is as follows:
53 weeks ended 52 weeks ended
30 April 2017 (£'m) 24 April 2016 (£'m)
Profit after tax 229.9 277.4
Post tax effect of adjustment items:
Profit on disposal of listed investments (141.5) (104.5)
Fair value adjustment to forward foreign exchange contracts (14.3) 5.2
Fair value adjustment to derivative financial instruments 24.0 (8.4)
Impairment of fixed assets - 4.4
Realised loss/(gain) on forward foreign exchange contracts 18.5 1.8
Profit on disposal of freehold properties - (10.4)
Impairment and accelerated depreciation and amortisation 17.3 45.2
Write off of deferred tax assets 12.5 -
Profit on disposal of subsidiary (79.9) -
Underlying profit after tax 66.5 210.7
DIVIDENDS
The Board has decided not to pay a dividend in relation to FY17. The Board
remains of the opinion that it is in the best interests of the Group and its
shareholders to preserve financial flexibility, facilitating future
investments and other growth opportunities. The payment of dividends remains
under review.
CAPITAL EXPENDITURE
During the period, capital expenditure amounted to £419.5m (FY16: £207.0m),
which includes £317.0m on properties (including fixtures and fittings).
ACQUISITIONS
During FY17 the Group acquired 100% of BSL Ltd, Community Bug Ltd and Vinecomb
Investments Ltd. The net cash outflow for these acquisitions was £8.1m. The
Group also acquired the remaining 49% of the Sports Direct business in
Portugal for E5.0m.
DISPOSALS
During the period, the Group disposed of the Dunlop brand and its related
wholesale and licensing activities for a total consideration of £109.5m,
resulting in a gain on disposal of £79.9m. This facilitates more bandwidth
for management to develop relationships with third party brands without the
need to manage the Dunlop brand on an international basis.
COMMERCIAL ARRANGEMENTS
In our FY17 H1 statement, we confirmed that MM Prop Consultancy Ltd, a company
owned and controlled by Michael Murray, continues to provide property
consultancy services to the group. MM Prop Consultancy Ltd is primarily tasked
with finding and negotiating the acquisition of new sites for both our larger
format stores and our combined retail and gym units, but it also provides
advice to the Company's in-house property team in relation to existing sites
both in the UK and in Europe. MM Prop Consultancy Ltd fees are linked directly
to value creation, which is determined by the Company's non-executive
directors who independently review performance bi-annually with a view to
determining, at their absolute and sole discretion, the quantum of the fee
payable. Under the terms of the agreement with MM Prop Consultancy Ltd no fees
are payable until at the earliest of 30 September 2018, so that the Company's
independent non-executive directors have a sufficient amount of time to assess
performance.
During FY17, the Company had arrangements in place with Barlin Delivery
Limited, a company owned by John Ashley (the brother of Mike Ashley). This
arrangement is no longer in place.
STRATEGIC INVESTMENTS
During the period the Group disposed of its remaining 9,920,000 shares in JD
Sports Fashion plc and at the year-end held no interest in the company. The
total economic interest held in Debenhams plc at the year-end was 16.8%
representing the put option and contract for differences. On 5 May 2016 the
maturity date of 30 November 2016 of the Put Option put in place on 23 January
2015 referencing 128,927,113 ordinary shares of Debenhams was extended by 12
months. The Group continues to hold an economic interest at the year-end in
Goals Soccer Centres plc of 3.84% and Iconix Brand Group Inc. of 11.4%, and
during the year acquired 11.2% of French Connection Group plc and 7.9% of
Finish Line Inc. The Group no longer holds an economic interest in Dicks
Sporting Goods Inc. The Group continues to hold a direct interest in Findel
plc representing 29.90% of the issued share capital; MySale Group plc,
representing 4.8% of the issued share capital; and, House of Fraser Limited
representing 11.11% of the issued share capital.
These stakes allow us to develop a relationship and potential commercial
partnerships with the relevant party and assist in building relationships with
key suppliers and brands.
The fair value of equity derivative agreements are included within the
derivative financial assets balance of £43.0m and derivative financial
liabilities balance of £75.2m.
CASH FLOW AND NET DEBT
Net debt increased by £82.4m from £99.7m at 24 April 2016 to £182.1m at 30
April 2017.
The analysis of debt at 30 April 2017 was as follows:
30 April 2017 (£'m) 24 April 2016 (£'m)
Cash and cash equivalents 204.7 234.2
Borrowings (386.8) (333.9)
Net debt (182.1) (99.7)
The Revolving Credit Facility of £788m is available until September 2018 and
is not secured against any of the Group's fixed assets. The Group is currently
making appropriate arrangements for post-September 2018.
The Group continues to operate well within its banking covenants and the Board
remains comfortable with the Group's available headroom.
CASH FLOW
Total movement is as follows:
30 April 2017 (£'m) 24 April 2016 (£'m)
Underlying EBITDA 272.7 381.4
Realised (loss)/profit on forward foreign exchange contracts (23.7) (2.4)
Taxes paid (75.3) (69.9)
Underlying free cash flow 173.7 309.1
Invested in:-
Movement in inventory 60.0 (155.4)
Working capital and other (38.3) (88.0)
Purchase of own shares (109.8) -
Acquisitions (including debt) (22.6) (33.1)
Proceeds on disposal of subsidiary 109.5 -
Net proceeds from investments 163.9 92.1
Net capital expenditure (417.1) (163.1)
Finance costs and other financing activities (1.7) (1.5)
Increase in net debt (82.4) (39.9)
The change in working capital is partly to support the growth of Sports Retail
and the online business and partly due to the timing of payments around year
end.
PENSIONS
The Group operates a defined benefit scheme in Sport Eybl Holding GmbH in
Austria. During the year, the Group disposed of the subsidiary that held the
Dunlop Slazenger pension scheme. The Group has no remaining contractual
obligations in relation to the Pension scheme following the disposal. The net
deficit in these schemes therefore decreased from £13.1m at 24 April 2016 to
£3.4m at 30 April 2017.
CONSOLIDATED INCOME STATEMENT
For the 53 weeks ended 30 April 2017
53 weeks ended 52 weeks ended
Note 30 April 2017 (£m) 24 April 2016 (£m)
Revenue 1,2 3,245.3 2,904.3
Cost of sales (1,914.7) (1,619.7)
Gross profit 1,330.6 1,284.6
Selling, distribution and administrative expenses (1,255.6) (1,021.7)
Other operating income 22.5 11.1
Exceptional items 3 (17.3) (50.8)
Profit on disposal of subsidiary 79.9 -
Operating profit 2 160.1 223.2
Investment income 162.5 148.1
Investment costs (51.2) -
Finance income 18.8 3.4
Finance costs (9.4) (15.3)
Share of profit of associated undertakings 0.8 2.4
Profit before taxation 281.6 361.8
Taxation 4 (49.9) (82.8)
Profit for the period 231.7 279.0
ATTRIBUTABLE TO:
Equity holders of the Group 229.9 277.4
Non-controlling interests 1.8 1.6
Profit for the period 231.7 279.0
EARNINGS PER SHARE ATTRIBUTABLE TO THE EQUITY SHAREHOLDERS
Pence per share Pence per share
Basic earnings per share 5 39.4 46.8
Diluted earnings per share 5 38.3 45.5
Underlying basic earnings per share 5 11.4 35.5
Diluted underlying basic earnings per share 5 11.1 34.5
The consolidated income statement has been prepared on the basis that all
operations are continuing.
The accompanying accounting policies and notes form part of these Financial
Statements.
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the 53 weeks ended 30 April 2017
53 weeks ended 52 weeks ended
Note 30 April 2017 (£m) 24 April 2016 (£m)
Profit for the period 2 231.7 279.0
OTHER COMPREHENSIVE INCOME
ITEMS THAT WILL NOT BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS
Actuarial losses on defined benefit pension schemes (8.8) -
Taxation on items recognised in other comprehensive income 1.7 -
ITEMS THAT WILL BE RECLASSIFIED SUBSEQUENTLY TO PROFIT OR LOSS
Exchange differences on translation of foreign operations 50.3 12.4
Exchange differences on hedged contracts - recognised in the period (31.3) (5.7)
Exchange differences on hedged contracts - reclassified and reported in sales 8.7 0.1
Exchange differences on hedged contracts - reclassified and reported in cost of sales (18.2) (63.8)
Exchange differences on hedged contracts - taxation taken to reserves 7.7 16.4
Fair value adjustment in respect of available-for-sale financial assets - recognised in the period 23.7 115.3
Fair value adjustment in respect of available-for-sale financial assets - reclassified in the period (129.3) (106.2)
Fair value adjustment in respect of available-for-sale financial assets - taxation (1.8) (1.8)
Other comprehensive cost for the period, net of tax (97.3) (33.3)
Total comprehensive income for the period 134.4 245.7
ATTRIBUTABLE TO:
Equity holders of the Group 132.6 244.1
Non-controlling interest 1.8 1.6
134.4 245.7
The accompanying accounting policies and notes form part of these Financial
Statements.
CONSOLIDATED BALANCE SHEET
At 30 April 2017
Note 30 April 2017 (£m) 24 April 2016 (£m)
ASSETS - NON-CURRENT
Property, plant and equipment 842.0 585.9
Investment properties 23.1 -
Intangible assets 185.7 208.6
Investments in associated undertakings 26.4 16.6
Available-for-sale financial assets 63.9 193.4
Deferred tax assets 33.7 43.9
1,174.8 1,048.4
ASSETS - CURRENT
Inventories 629.2 702.2
Trade and other receivables 397.1 292.6
Derivative financial assets 43.0 82.5
Cash and cash equivalents 204.7 234.2
1,274.0 1,311.5
TOTAL ASSETS 2,448.8 2,359.9
EQUITY AND LIABILITIES
Share capital 64.1 64.1
Share premium 874.3 874.3
Treasury shares reserve (329.5) (56.2)
Permanent contribution to capital 0.1 0.1
Capital redemption reserve 8.0 8.0
Foreign currency translation reserve 77.1 26.8
Reverse combination reserve (987.3) (987.3)
Own share reserve (33.7) (33.7)
Hedging reserve (25.1) 8.0
Retained earnings 1,591.0 1,482.3
Issued capital and reserves attributable to owners of the parent 1,239.0 1,386.4
Non-controlling interests (0.7) (1.7)
Total equity 1,238.3 1,384.7
LIABILITIES - NON-CURRENT
Borrowings 6 317.3 333.1
Retirement benefit obligations 3.4 13.1
Deferred tax liabilities 18.7 21.6
Provisions 130.2 66.7
469.6 434.5
LIABILITIES - CURRENT
Derivativefinancial liabilities 75.2 61.7
Trade and other payables 584.9 426.7
Borrowings 6 69.5 0.8
Current tax liabilities 11.3 51.5
740.9 540.7
Total liabilities 1,210.5 975.2
Total equity and liabilities 2,448.8 2,359.9
CONSOLIDATED CASH FLOW STATEMENT
For the 53 weeks ended 30 April 2017
53 weeks ended 52 weeks ended
Note 30 April 2017 (£m) 24 April 2016 (£m)
Cash inflow from operating activities 7 269.2 135.6
Income taxes paid (75.3) (69.9)
Net cash inflow from operating activities 193.9 65.7
CASH FLOW FROM INVESTING ACTIVITIES
Proceeds on disposal of property, plant and equipment 2.4 44.0
Proceeds on disposal of listed investments 190.2 181.3
Proceeds on disposal of subsidiary 109.5 -
Purchase of associate, net of cash acquired (9.0) (9.1)
Purchase of subsidiaries, net of cash acquired (8.1) (24.0)
Exercise of option over non-controlling interests (5.5) -
Purchase of property, plant and equipment (413.5) (207.0)
Purchase of investment properties (6.0) -
Purchase of intangible assets - (0.1)
Purchase of listed investments (24.7) (89.2)
Investment income received 0.5 2.8
Finance income received 0.5 3.4
Net cash outflow from investing activities (163.7) (97.9)
CASH FLOW FROM FINANCING ACTIVITIES
Finance costs paid (2.6) (7.7)
Borrowings drawn down 328.0 267.4
Borrowings repaid (344.1) (71.3)
Purchase of own shares (109.8) -
Net cash outflow from financing activities (128.7) 188.4
Net increase / (decrease) in cash and cash equivalents including overdrafts (98.5) 156.2
Cash and cash equivalents including overdrafts at beginning of period 233.7 77.5
Cash and cash equivalents including overdrafts at the period end 135.2 233.7
The accompanying accounting policies and notes form part of these Financial
Statements.
CONSOLIDATED STATEMENT OF CHANGES
IN EQUITY
For the 53 weeks ended 30 April 2017
Treasury Foreign currency Own share Retained Other reserves Total attributable Non-controlling Total
shares translation reserve earnings (£m) to owners of interests (£m)
(£m) (£m) (£m) (£m) parent (£m)
(£m)
At 26 April 2015 (56.2) 14.4 (13.3) 1,181.5 38.0 1,164.4 (2.8) 1,161.6
Credit to equity for share-based payment - - - 4.2 - 4.2 - 4.2
Vesting of share based payments - - 9.0 (9.0) - - - -
Current tax on share scheme - - - 3.2 - 3.2 - 3.2
Purchase of own shares - (29.4) - - (29.4) - (29.4)
Non-controlling interests - acquisitions - - - - - - (0.4) (0.4)
Transactions with owners - - (20.4) (1.6) - (22.0) (0.4) (22.4)
Profit for the financial period - - - 277.4 - 277.4 1.5 278.9
OTHER COMPREHENSIVE INCOME
Cash flow hedges - recognised in the period - - - - (5.7) (5.7) - (5.7)
Cash flow hedges - reclassified and reported in sales - - - - 0.1 0.1 - 0.1
Cash flow hedges - reclassified and reported in cost of sales - - - - (63.8) (63.8) - (63.8)
Cash flow hedges - taxation - - - - 16.3 16.3 - 16.3
Cash flow hedges - prior year taxation reclassified - - - 17.7 (17.7) - - -
Actuarial losses on defined benefit pension schemes - - - - - - - -
Fair value adjustment in respect of available-for-sale - - - (106.2) (106.2) - - (106.2)
financial assets- reclassified
Fair value adjustment in respect of available-for-sale - - - 115.3 - 115.3 - 115.3
financial assets- recognised
Taxation - - - (1.8) - (1.8) - (1.8)
Translation differences - Group - 12.4 - - - 12.4 - 12.4
Total comprehensive income for the period - 12.4 - 302.4 (70.8) 244.0 1.5 245.5
At 24 April 2016 (56.2) 26.8 (33.7) 1,482.3 (32.8) 1,386.4 (1.7) 1,384.7
Credit to equity for share-based payment - - - 1.9 - 1.9 - 1.9
Deferred tax on share schemes - - - (1.3) - (1.3) - (1.3)
Purchase of own shares (109.8) - - - - (109.8) - (109.8)
Fair valuation of share buyback (163.5) - - - - (163.5) - (163.5)
Non-controlling interests - acquisitions - - - (7.3) - (7.3) (0.8) (8.1)
Transactions with owners (273.3) - - (6.7) - (280.0) (0.8) (280.8)
Profit for the financial period - - - 229.9 - 229.9 1.8 231.7
OTHER COMPREHENSIVE INCOME
Cash flow hedges - recognised in the period - - - - (31.3) (31.3) - (31.3)
Cash flow hedges - reclassified and reported in sales - - - - 8.7 8.7 - 8.7
Cash flow hedges - reclassified and reported in cost of sales - - - - (18.2) (18.2) - (18.2)
Cash flow hedges - taxation - - - - 7.7 7.7 - 7.7
Actuarial losses on defined benefit pension schemes - - - (8.8) - (8.8) - (8.8)
Fair value adjustment in respect of available-for-sale financial assets - recognised - - - 23.7 - 23.7 - 23.7
Fair value adjustment in respect of available-for-sale financial assets - reclassified - - - (129.3) - (129.3) - (129.3)
Taxation - - - (0.1) - (0.1) - (0.1)
Translation differences - Group - 50.3 - - - 50.3 - 50.3
Total comprehensive income for the period - 50.3 - 115.4 (33.1) 132.6 1.8 134.4
At 30 April 2017 (329.5) 77.1 (33.7) 1,591.0 (65.9) 1,239.0 (0.7) 1,238.3
1. ACCOUNTING POLICIES
The financial information, which comprises the consolidated income statement,
consolidated statement of comprehensive income, consolidated balance sheet,
consolidated cash flow statement, consolidated statement of changes in equity
and related notes, does not constitute full accounts within the meaning of
s435 (1) and (2) of the Companies Act 2006. The auditors have reported on the
Group's statutory accounts for the each of the years ended 30 April 2017 and
24 April 2016 which do not contain any statement under s498 of the Companies
Act 2006 and are unqualified. The statutory accounts for the year ended 24
April 2016 have been delivered to the Registrar of Companies and the statutory
accounts for the year ended 30 April 2017 will be filed with the registrar in
due course.
The consolidated financial statements have been prepared in accordance with
IFRS as adopted for use in the European Union (including International
Accounting Standards ("IAS") and International Financial Reporting Standards
Interpretations Committee ("IFRSiC") interpretations) and with those parts of
the Companies Act 2006 applicable to companies reporting under IFRS as adopted
for use in the European Union. The consolidated financial statements have been
prepared under the historical cost convention, as modified to include fair
valuation of certain financial assets and derivative financial instruments.
2. SEGMENTAL ANALYSIS
Management have determined to present its segmental disclosures in a different
way to that previously reported. Following our recent interaction with the
Conduct Committee of the FRC in relation to this matter, and recognising the
potential impact of Brexit on the economic characteristics of the countries we
trade in through our European retail operations, and reconsidering the
prolonged challenges this business is facing and the impact on long term
financial performance expectations this will have, we have now presented our
International Sports Retail segment separately from UK Sports Retail. We
continue to monitor the impacts of Brexit, and the continued uncertainties
this has brought relating to the political and economic environments, and
market and currency volatility in the countries we operate in. European
countries have been identified as operating segments and have been aggregated
into a single operating segment as permitted under IFRS 8. The decision to
aggregate these segments was based on the fact that they each have similar
economic characteristics, similar long term financial performance
expectations, and are similar in each of the following respects:
· The nature of the products
· The type or class of customer for the products; and
· The methods used to distribute the products
In accordance with paragraph 12 of IFRS 8 the Group's operating segments have
been aggregated into the following reportable segments:
1. UK Sports Retail - includes the results of the UK retail network of
sports stores along with related websites;
2. International Retail - includes the results of the International retail
network of sports stores;
3. Premium Lifestyle - includes the results of the premium and lifestyle
retail businesses such as USC, Cruise and Flannels; and
4. Brands - includes the results of the Group's portfolio of
internationally recognised brands such as Everlast, Lonsdale and Slazenger.
The comparative information for the period ended 24 April 2016 has been
restated.
Information regarding the Group's reportable segments for the 53 weeks ended
30 April 2017, as well as a reconciliation of reported profit for the period
to underlying EBITDA, is presented below.
Segmental information for the 53 weeks ended 30 April 2017:
Retail(£m) Brands(£m) Eliminations(£m) Total(£m)
UK Sports Retail International Sports Retail Premium Lifestyle Total
Sales to external customers 2,136.4 665.6 202.2 3,004.2 241.1 - 3,245.3
Sales to other segments - - - - 30.1 (30.1) -
Revenue 2,136.4 665.6 202.2 3,004.2 271.2 (30.1) 3,245.3
Gross profit 879.4 287.3 76.1 1,242.8 87.8 - 1,330.6
Operating profit/(loss) before foreign exchange and exceptional items 166.6 (61.9) (4.0) 100.7 20.5 - 121.2
Operating profit/(loss) 157.4 (69.2) (4.2) 84.0 76.1 - 160.1
Net investment income 111.3
Finance income 18.8
Finance costs (9.4)
Share of profits of associated undertakings 0.8
Profit before taxation 281.6
Taxation (49.9)
Profit for the period 231.7
Sales to other segments are priced at cost plus a 10% mark-up.
Other segment items included in the income statement for the 53 weeks ended 30
April 2017:
Retail(£m) Brands(£m) Total(£m)
UK Sports Retail International Sports Retail Premium Lifestyle Total
Depreciation 94.8 41.2 2.4 138.4 2.2 140.6
Amortisation 1.2 1.1 1.3 3.6 3.7 7.3
Information regarding segment assets and liabilities as at 30 April 2017 and
capital expenditure for the 53 weeks then ended:
UK Sports Retail(£m) International Sports Retail(£m) Premium Lifestyle(£m) Brands(£m) Eliminations(£m) Total(£m)
Investments in associated undertakings 25.8 0.6 - - - 26.4
Other assets 2,194.5 374.1 19.1 357.6 (522.9) 2,422.4
Total assets 2,220.3 374.7 19.1 357.6 (522.9) 2,448.8
Total liabilities (1,008.6) (538.6) (64.5) (121.7) 522.9 (1,210.5)
Tangible asset additions 399.5 14.6 3.0 2.4 - 419.5
Intangible asset additions 2.3 - - 5.1 - 7.4
Total capital expenditure 401.8 14.6 3.0 7.5 - 426.9
Segmental information for the 52 weeks ended 24 April 2016:
Brands(£m) Eliminations(£'m) Total(£m)
UK Sports Retail International Sports Retail Premium Lifestyle Total Total
Sales to external customers 2,009.3 482.3 181.2 2,672.8 231.5 - 2,904.3
Sales to other segments - - - - 40.5 (40.5) -
Revenue 2,009.3 482.3 181.2 2,672.8 272.0 (40.5) 2,904.3
Gross profit 894.9 216.0 76.2 1,187.1 97.5 - 1,284.6
Operating profit /(loss) before foreign exchange and exceptional items 282.3 (28.6) (9.7) 244.0 32.3 - 276.3
Operating profit /(loss) 274.9 (52.4) (23.2) 199.3 23.9 - 223.2
Other investment income 148.1
Finance income 3.4
Finance costs (15.3)
Share of profits of associated undertakings 2.4
Profit before taxation 361.8
Taxation (82.8)
Profit for the period 279.0
Other segment items included in the income statement for the 52 weeks ended 24
April 2016:
Retail(£m) Brands(£m) Total(£m)
UK Sports Retail International Sports Retail Premium Lifestyle Total
Depreciation 65.4 17.4 4.0 86.8 2.4 89.2
Amortisation 0.8 2.2 0.7 3.7 2.7 6.4
Information regarding segment assets and liabilities as at 24 April 2016 and
capital expenditure for the 52 weeks then ended:
UK Sports Retail(£m) International Sports Retail(£m) Premium Lifestyle(£m) Brands(£m) Eliminations(£m) Total(£m)
Investments in associated undertakings and joint ventures 16.4 0.2 - - - 16.6
Other assets 2,102.5 268.6 24.3 222.8 (275.0) 2,343.2
Total assets 2,119.0 268.8 24.3 222.8 (275.0) 2,359.9
Total liabilities (795.7) (314.7) (64.4) (75.4) 275.0 (975.2)
Tangible asset additions 188.2 86.6 1.2 0.4 - 276.4
Intangible asset additions 0.1 3.9 - - - 4.0
Total capital expenditure 188.3 90.5 1.2 0.4 - 280.4
GEOGRAPHIC INFORMATION
Segmental information for the 53 weeks ended 30 April 2017:
UK(£m) Non-UK(£m) Eliminations(£m) Total(£m)
Segmental revenue from external customers 2,408.6 836.7 - 3,245.3
Total capital expenditure 410.1 16.8 - 426.9
Non-current segmental assets* 738.9 338.3 - 1,077.2
Total segmental assets 2,350.4 573.6 (475.2) 2,448.8
*Excludes deferred tax and financial instruments.
Segmental information for the 52 weeks ended 24 April 2016:
UK(£m) Non-UK(£m) Eliminations(£m) Total(£m)
Segmental revenue from external customers 2,281.1 623.2 - 2,904.3
Total capital expenditure 189.6 90.7 - 280.3
Non-current segmental assets* 464.7 346.4 - 811.1
Total segmental assets 2,151.3 439.1 (230.5) 2,359.9
*Excludes deferred tax and financial instruments.
Material non-current segmental assets - by non-UK country
USA(£m) Belgium(£m) Austria Estonia Ireland
(£m) (£m) (£m)
FY17 164.2 32.6 64.0 15.2 58.2
FY16 149.4 9.3 62.6 18.3 74.0
The following table reconciles the reported operating profit to the underlying
EBITDA as it is one of the main measures used by the Chief Operating Decision
Maker when reviewing performance:
Reconciliation of operating profit to underlying EBITDA for the 53 week period
ended 30 April 2017:
UKSports Retail(£m) International Sports Retail(£m) Premium Lifestyle(£m) Brands(£m) Total(£m)
Operating profit / (loss) 157.4 (69.2) (4.2) 76.1 160.1
Depreciation 94.8 41.2 2.4 2.2 140.6
Amortisation 1.2 1.1 1.3 3.7 7.3
Share of profit of associated undertakings 0.4 0.4 - - 0.8
Reported EBITDA 253.8 (26.5) (0.5) 82.0 308.8
Charges for the share scheme 2.8 - - - 2.8
Disposal of subsidiary - - - (79.9) (79.9)
Exceptional items 2.9 4.5 0.2 9.7 17.3
Realised FX gain / (loss) 6.2 2.9 - 14.6 23.7
Underlying EBITDA 265.7 (19.1) (0.3) 26.4 272.7
Reconciliation of operating profit to underlying EBITDA for the 52 week period
ended 24 April 2016:
UK Sports Retail(£m) International Sports Retail (£m) Premium Lifestyle (£m) Brands (£m) Total (£m)
Operating profit / (loss) 274.7 (52.2) (23.2) 23.9 223.2
Depreciation 65.4 17.4 4.0 2.4 89.2
Amortisation 0.8 2.2 0.6 2.8 6.4
Share of (loss) / profit of associated undertakings (0.1) 2.5 - - 2.4
Reported EBITDA 340.8 (30.1) (18.6) 29.1 321.2
Charges for the share scheme 7.1 - - - 7.1
Exceptional items 1.9 25.2 13.7 10.0 50.8
Realised FX (loss) / gain 4.1 - (0.2) (1.6) 2.3
Underlying EBITDA 353.9 (4.9) (5.1) 37.5 381.4
3. EXCEPTIONAL ITEMS
53 weeks ended 52 weeks ended
30 April 2017(£m) 24 April 2016(£m)
Profit on sale of freehold property - 13.5
Impairment (17.3) (58.5)
Provision against receivables - (5.8)
(17.3) (50.8)
The impairment mainly relates to a review of the business and the valuation of
own brands and goodwill that are no longer considered core brands, in line
with the Elevation of Retail management strategy.
4. TAXATION
The effective rate of 17.7% reflected income that is not deductible for tax
purposes in the period. Non-taxable income includes disposal of subsidiaries
and investments that qualify for Substantial Shareholder Relief. Prior period
adjustments include income that is now considered to qualify for substantial
shareholder relief, and a reduction in deferred tax assets for overseas losses
no longer considered recoverable. Expenses not deductible for tax purposes
include non-qualifying depreciation and goodwill impairments.
5. EARNINGS PER SHARE FROM TOTAL AND CONTINUING OPERATIONS ATTRIBUTABLE TO THE
EQUITY SHAREHOLDERS
Basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders of the parent by the weighted average number of
ordinary shares outstanding during the year.
For diluted earnings per share, the weighted average number of shares,
583,501,473 (2016: 592,573,254), is adjusted to assume conversion of all
dilutive potential ordinary shares under the Group's Share Schemes, being
16,667,000 (2016: 17,667,000), to give the diluted weighted average number of
shares of 600,168,473 (2016: 610,240,254).
BASIC AND DILUTED EARNINGS PER SHARE
53 weeks ended 52 weeks ended
30 April 2017 Basic (£m) 30 April 2017Diluted(£m) 24 April 2016Basic(£m) 24 April 2016Diluted(£m)
Profit for the period 229.9 229.9 277.4 277.4
Number in thousands Number in thousands
Weighted average number of shares 583,501 600,168 592,573 610,240
Pence per share Pence per share
Earnings per share 39.4 38.3 46.8 45.5
UNDERLYING EARNINGS PER SHARE
The underlying earnings per share reflects the underlying performance of the
business compared with the prior year and is calculated by dividing underlying
earnings by the weighted average number of shares for the period. Underlying
earnings is used by management as a measure of profitability within the Group.
Underlying earnings is defined as profit for the period attributable to equity
holders of the parent for each financial period but excluding the post-tax
effect of certain non-trading items. Tax has been calculated with reference to
the effective rate of tax for the Group.
The Directors believe that the underlying earnings before exceptional items
and underlying earnings per share measures provide additional useful
information for shareholders on the underlying performance of the business,
and are consistent with how business performance is measured internally.
Underlying earnings is not a recognised profit measure under IFRS and may not
be directly comparable with "adjusted" profit measures used by other
companies.
53 weeks ended 52 weeks ended
30 April 2017Basic(£m) 30 April 2017Diluted(£m) 24 April 2016Basic(£m) 24 April 2016Diluted(£m)
Profit for the period 229.9 229.9 277.4 277.4
Post tax adjustments to profit for the period for the following non-trading items:
Realised loss on forward exchange contracts 18.5 18.5 1.8 1.8
Fair value adjustment to forward foreign exchange contracts (14.3) (14.3) 5.2 5.2
Fair value adjustment to derivative financial instruments 24.0 24.0 (8.4) (8.4)
Profit on disposal of listed investments (141.5) (141.5) (104.5) (104.5)
Impairment of fixed assets - - 4.4 4.4
Profit on disposal of property - - (10.4) (10.4)
Profit on disposal of subsidiary (79.9) (79.9)
Impairment 17.3 17.3 45.1 45.1
Write off of deferred tax assets 12.5 12.5 - -
Underlying profit for the period 66.5 66.5 210.6 210.6
Number in thousands Number in thousands
Weighted average number of shares 583,501 600,168 592,573 610,240
Pence per share Pence per share
Underlying earnings per share 11.4 11.1 35.5 34.5
6. BORROWINGS
30 April 2017(£m) 24 April 2016(£m)
NON-CURRENT:
Bank and other loans 317.3 333.1
CURRENT:
Bank overdrafts 69.5 0.5
Bank and other loans - 0.3
69.5 0.8
TOTAL BORROWINGS:
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