- Part 3: For the preceding part double click ID:nRSG0426Qb
of additional pension liability (4.3) (14.9)
Tax relating to components of other comprehensive income 0.4 4.5
(2.4) (23.8)
OTHER COMPREHENSIVE INCOME FOR THE YEAR 0.1 22.0
TOTAL COMPREHENSIVE INCOME FOR THE YEAR 34.4 72.3
ATTRIBUTABLE TO:
Owners of the Company 33.8 72.1
Non-controlling interest 0.6 0.2
34.4 72.3
Group Statement of Changes in Equity Genus plc
For the year ended 30 June 2017
Note Called up share capital£m Share premium account£m Own shares£m Trans-lation reserve£m Hedging reserve£m Retained earnings£m Total£m Non- controlling interest£m Total equity£m
BALANCE AT 30 JUNE 2015 6.1 112.2 (0.1) (10.1) - 202.7 310.8 (5.7) 305.1
Foreign exchange translationdifferences, net of tax - - - 58.2 - - 58.2 (1.2) 57.0
Fair value movement on net investment hedges, net of tax - - - (10.6) - - (10.6) - (10.6)
Fair value movement on cash flow hedges, net of tax - - - - (0.6) - (0.6) - (0.6)
Actuarial loss on retirement benefit obligations, net of tax - - - - - (11.0) (11.0) - (11.0)
Movement on pension asset recognition restriction, net of tax - - - - - (0.6) (0.6) - (0.6)
Recognition of additional pension liability, net of tax - - - - - (12.2) (12.2) - (12.2)
Other comprehensive (expense)/income for the year - - - 47.6 (0.6) (23.8) 23.2 (1.2) 22.0
Profit for the year - - - - - 49.3 49.3 1.0 50.3
Total comprehensive income for the year - - - 47.6 (0.6) 25.5 72.5 (0.2) 72.3
Recognition of share-based payments, net of tax - - - - - 3.3 3.3 - 3.3
Adjustment arising from changein non-controlling interest and written put option - - - - - - - (0.5) (0.5)
Dividends 7 - - - - - (12.2) (12.2) - (12.2)
Issue of ordinary shares - 0.1 - - - - 0.1 - 0.1
BALANCE AT 30 JUNE 2016 6.1 112.3 (0.1) 37.5 (0.6) 219.3 374.5 (6.4) 368.1
Foreign exchange translationdifferences, net of tax - - - 3.9 - - 3.9 (0.9) 3.0
Fair value movement on net investment hedges, net of tax - - - (2.2) - - (2.2) - (2.2)
Fair value movement on cash flow hedges, net of tax - - - - 1.7 - 1.7 - 1.7
Actuarial gain on retirement benefit obligations, net of tax - - - - - 1.0 1.0 - 1.0
Movement on pension asset recognition restriction, net of tax - - - - - 0.3 0.3 - 0.3
Recognition of additional pension liability, net of tax - - - - - (3.7) (3.7) - (3.7)
Other comprehensive (expense)/income for the year - - - 1.7 1.7 (2.4) 1.0 (0.9) 0.1
Profit for the year - - - - - 32.8 32.8 1.5 34.3
Total comprehensive income for the year - - - 1.7 1.7 30.4 33.8 0.6 34.4
Recognition of share-based payments, net of tax - - - - - 4.0 4.0 - 4.0
Adjustment arising from change in non-controlling interest - - - - - - - 8.6 8.6
Dividends 7 - - - - - (13.5) (13.5) - (13.5)
Issue of ordinary shares - 0.5 - - - - 0.5 - 0.5
BALANCE AT 30 JUNE 2017 6.1 112.8 (0.1) 39.2 1.1 240.2 399.3 2.8 402.1
Group Balance Sheet Genus plc
As at 30 June 2017
Note 2017£m 2016
£m
ASSETS
Goodwill 8 104.7 86.0
Other intangible assets 8 88.3 78.0
Biological assets 9 279.2 264.6
Property, plant and equipment 67.5 61.8
Interests in joint ventures and associates 22.7 24.3
Other investments 5.5 3.6
Derivative financial asset 0.1 -
Deferred tax assets 3.8 4.7
TOTAL NON-CURRENT ASSETS 571.8 523.0
Inventories 33.1 35.7
Biological assets 9 73.9 66.4
Trade and other receivables 10 88.8 78.1
Cash and cash equivalents 26.5 34.0
Income tax receivable 1.9 1.0
Derivative financial asset 1.3 0.6
Asset held for sale 0.3 0.3
TOTAL CURRENT ASSETS 225.8 216.1
TOTAL ASSETS 797.6 739.1
LIABILITIES
Trade and other payables (76.4) (65.1)
Interest-bearing loans and borrowings (7.7) (4.6)
Provisions (2.7) (1.2)
Obligations under finance leases (1.4) (1.1)
Current tax liabilities (5.2) (4.9)
Derivative financial liabilities (0.6) (0.5)
TOTAL CURRENT LIABILITIES (94.0) (77.4)
Interest-bearing loans and borrowings (127.2) (115.3)
Retirement benefit obligations 11 (40.9) (44.5)
Provisions (3.7) -
Deferred tax liabilities (124.2) (118.5)
Derivative financial liabilities (3.7) (12.6)
Obligations under finance leases (1.8) (2.7)
TOTAL NON-CURRENT LIABILITIES (301.5) (293.6)
TOTAL LIABILITIES (395.5) (371.0)
NET ASSETS 402.1 368.1
2017£m 2016
£m
EQUITY
Called up share capital 6.1 6.1
Share premium account 112.8 112.3
Own shares (0.1) (0.1)
Translation reserve 40.0 37.5
Hedging reserve 1.1 (0.6)
Retained earnings 239.4 219.3
Equity attributable to owners of the Company 399.3 374.5
Non-controlling interest 6.1 5.0
Put option over non-controlling interest 15 (3.3) (11.4)
Total non-controlling interest 2.8 (6.4)
Total equity 402.1 368.1
Group Statement of Cash Flows Genus plc
For the year ended 30 June 2017
Note 2017£m 2016£m
NET CASH FLOW FROM OPERATING ACTIVITIES 12 34.6 30.0
CASH FLOWS FROM INVESTING ACTIVITIES
Dividends received from joint ventures and associates 3.8 2.4
Joint venture loan repayment 3.0 1.0
Acquisition of subsidiaries, net of cash acquired 14 (17.5) (3.5)
Increase in investment in subsidiaries 14 (12.0) -
Acquisition of investment (0.3) (3.5)
Acquisition of investment in joint venture (0.2) (0.2)
Disposal of subsidiary, net of cash disposed - 0.1
Disposal of joint venture 1.5 -
Purchase of property, plant and equipment (13.4) (11.8)
Purchase of intangible assets (5.5) (6.8)
Proceeds from sale of property, plant and equipment 1.4 1.8
Proceeds from sale of assets held for sale - 0.7
NET CASH OUTFLOW FROM INVESTING ACTIVITIES (39.2) (19.8)
CASH FLOWS FROM FINANCING ACTIVITIES
Drawdown of borrowings 68.1 53.6
Repayment of borrowings (55.7) (37.3)
Payment of finance lease liabilities (2.0) (1.9)
Equity dividends paid (13.5) (12.2)
Dividend to non-controlling interest (0.1) (0.4)
Issue of ordinary shares 0.5 0.1
Debt issue costs (0.4) (1.4)
NET CASH (OUTFLOW)/INFLOW FROM FINANCING ACTIVITIES (3.1) 0.5
NET (DECREASE)/INCREASE IN CASH AND CASH EQUIVALENTS (7.7) 10.7
Cash and cash equivalents at start of the year 34.0 21.3
Net (decrease)/increase in cash and cash equivalents (7.7) 10.7
Effect of exchange rate fluctuations on cash and cash equivalents 0.2 2.0
TOTAL CASH AND CASH EQUIVALENTS AT 30 JUNE 26.5 34.0
Notes to the Preliminary Results Genus plc
For the year ended 30 June 2017
1. REPORTING ENTITY
Status of audit
The financial information given does not constitute the Company's statutory accounts for the year ended 30 June 2017 or the
year ended 30 June 2016, but is derived from those accounts. Statutory accounts for the year ended 30 June 2016 have been
delivered to the Registrar of Companies and those for the year ended 30 June 2017 will be delivered following the Company's
annual general meeting. The auditors have reported on those accounts; their reports were unqualified, did not draw
attention to any matters by way of emphasis without qualifying their reports, and did not contain statements under s.
498(2) or (3) Companies Act 2006.
Basis of preparation
The financial information for the year ended 30 June 2017 together with the comparative year has been computed in
accordance with International Financial Reporting Standards (IFRSs) as adopted by the European Union.
The Group Financial Statements are presented in Sterling, which is the Company's functional and presentation currency. All
financial information presented in Sterling has been rounded to the nearest million at one decimal point.
The principal exchange rates were as follows:
Average Closing
2017 2016 2015 2017 2016 2015
US Dollar/£ 1.27 1.47 1.57 1.30 1.34 1.57
Euro/£ 1.16 1.33 1.32 1.14 1.20 1.41
Brazilian Real/£ 4.11 5.47 4.26 4.30 4.28 4.89
Mexican Peso/£ 24.61 25.38 22.68 23.51 24.66 24.68
While the financial information included in this preliminary announcement has been computed in accordance with IFRSs, this
announcement does not itself contain sufficient information to comply with IFRSs. The Company expects to publish full
financial statements that comply with IFRSs in October 2017. These financial statements have also been prepared in
accordance with the accounting policies set out in the 2016 Annual Report and Financial Statements, as amended by the
following new accounting standards.
New standards and interpretations
The following new standards and interpretations have been adopted in the current period:
· Amendments to IFRS 11 'Accounting for acquisitions of interests in Joint ventures', IAS 27 'Equity method in separate
financial statements', IAS 1 'Disclosure Initiatives';
· Amendments to IFRS 10, IFRS 12 and IAS 28 'Investment entities: Applying the consolidation exception';
·Amendments to IAS 16 and IAS 38 'Clarification of acceptable method of depreciation and amortisation'; and
·'Annual Improvements to IFRS 2012 - 2014 cycle'.
There has been no significant impact on the results or disclosures for the current period from the adoption of these new
standards and interpretations.
New standards and interpretations not yet adopted
At the date of authorisation of these Group Financial Statements, the following standards and interpretations were in issue
but not yet effective (and in some cases had not yet been adopted by the EU). These standards and interpretations have not
been applied in preparing these Group Financial Statements:
· 'Annual improvement 2014-2016 cycle';
· IFRIC 22 'Foreign currency transaction and advance consideration';
·IAS 7 (amendments) 'Disclosure Initiative';
·IAS 12 'Recognition of deferred tax assets for unrealised losses';
· IFRS 2 (amendments) 'Classification and Measurement of Share-based Payment Transactions';
· IFRS 9 'Financial Instruments';
· IFRS 10 and IAS 28 (amendments) 'Sale or Contribution of Assets between an Investor and its Associate or Joint venture';
· IFRS 15 'Revenue from Contracts with Customers'; and
· IFRS 16 'Leases'.
The Group is currently assessing the impact of the new pronouncements on its results, financial position and cash flows. It
is not practicable to provide a reasonable estimate of the effect of these standards until a detailed review has been
completed.
Going concern
After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue its
operational existence for the foreseeable future and for a period of at least twelve months from the date of this report.
Accordingly, the Directors continue to adopt and consider appropriate the going concern basis in preparing the Annual
Report and Accounts.
Alternative performance measures
In reporting financial information, the Group presents alternative performance measures, ('APMs'), which are not defined or
specified under the requirements of IFRS.
The Group believes that these APMs, which are not considered to be a substitute for or superior to IFRS measures, provide
stakeholders with additional helpful information on the performance of the business. The APMs are consistent with how the
business performance is planned and reported within the internal management reporting to the Board and the executive
leadership committee. Some of these measures are also used for the purpose of setting remuneration targets.
The key APMs that the Group uses include: adjusted operating profit, adjusted profit before tax from continuing operations,
adjusted earnings per share, adjusted EBITDA and net debt.
The Group reports some financial measures, on both a reported and constant currency basis. The constant currency basis,
which is an APM, retranslates the previous year results at the average actual periodic exchange rates used in the current
financial year. This measure is presented as a means of eliminating the effects of exchange rate fluctuations on the
year-on-year reported results.
The Group makes certain adjustments to the statutory profit measures in order to derive many of these APMs. The Group's
policy is to exclude items that are considered to be significant in both nature and/or quantum and where treatment as an
adjusted item provides stakeholders with additional useful information to assess the year-on-year trading performance of
the Group. On this basis, the following were included within adjusted items for the year ended 30 June 2017:
· net IAS 41 valuation movements on biological assets - movements can be materially volatile and do
not directly correlate to the underlying trading performance in the period. Furthermore, the movement is non-cash related
and many assumptions used in the valuation model are based on future projections rather than current trading;
· amortisation of acquired intangible assets - by excluding it helps the comparability between
acquired operations and organically grown operations, as the latter are not able to recognise internally generated
intangible assets. Adjusting for amortisation provides a more consistent basis for comparison between the two;
· share based payments - this expense is considered to be relatively volatile and is not fully
reflective of the current period trading as the performance criteria are based on EPS performance over a three year period
and include estimates of future period performance; and
· exceptional items - are items which either due to their size or their nature are excluded to improve
the understanding of the Company's underlying performance, see note 3 for further details.
The reconciliation between operating profit from continuing operations and adjusted operating profit from continuing
operations is shown on the face of the Group Income Statement. All other reconciliations are included within the Financial
Review section.
This preliminary announcement was approved by the Board on 6 September 2017.
2. SEGMENTAL INFORMATION
IFRS 8 'Operating Segments' requires operating segments to be identified on the basis of internal reports about components
of the Group that are regularly reviewed by the Group Chief Executive and the Board to allocate resources to the segments
and to assess their performance. For management purposes effective from 1 July 2016, the Group's operating and reporting
structure comprises three operating segments: Genus PIC, Genus ABS and Research and Development.
These segments are the basis on which the Group reports its segmental information. The principal activities of each segment
are as follows:
Genus PIC - our global porcine sales business;
Genus ABS - our global bovine sales business and
Research and Development - our global spend on research and development.
A segment analysis of revenue, operating profit, depreciation, amortisation and non-current asset additions and segment
assets and liabilities are detailed below. We do not include our adjusting items in the segments, as we believe these do
not reflect the underlying progress of the segments. The accounting policies of the reportable segments are the same as the
Group's accounting policies, as described in the Financial Statements.
Revenue 2017 2016
£m £m
Genus PIC 249.5 207.5
Genus ABS 195.9 172.8
Research and Development
Research - -
Porcine Product Development 10.7 8.0
Bovine Product Development 3.0 -
13.7 8.0
459.1 388.3
Operating profit by segment is set out below and reconciled to the Group's adjusted operating profit. A reconciliation of
adjusted operating profit to profit for the year is shown on the Group Income Statement.
Adjusted operating profit 2017 2016
£m £m
Genus PIC 87.7 71.7
Genus ABS 22.3 23.3
Research and Development
Research (11.9) (8.0)
Porcine Product Development (16.6) (13.5)
Bovine Product Development (14.2) (12.9)
(42.7) (34.4)
Adjusted segment operating profit 67.3 60.6
Central (12.2) (11.3)
Adjusted operating profit 55.1 49.3
Our business is not highly seasonal and our customer base is diversified, with no individual customer generating more than
2% of revenue.
Other segment information
Depreciation Amortisation Additions to non-current assets
2017£m 2016£m 2017£m 2016£m 2017£m 2016£m
Genus PIC 0.8 0.8 6.0 5.9 1.1 1.4
Genus ABS 2.1 1.7 2.1 1.1 3.4 2.6
Research and Development
Research 0.3 - 0.9 - 2.5 3.6
Porcine Product Development 1.9 1.8 - - 2.6 1.7
Bovine Product Development 1.4 1.4 2.2 - 5.6 7.3
3.6 3.2 3.1 - 10.7 12.6
Segment total 6.5 5.7 11.2 7.0 15.2 16.6
Central 2.3 2.2 - - 5.0 4.3
Total 8.8 7.9 11.2 7.0 20.2 20.9
Segment assets Segment liabilities
2017£m 2016£m 2017£m 2016£m
Genus PIC 258.3 233.5 (60.1) (50.3)
Genus ABS 132.8 144.4 (41.1) (47.7)
Research and Development
Research 5.9 3.7 (1.4) (0.4)
Porcine Product Development 182.4 146.7 (72.0) (59.6)
Bovine Product Development 202.7 203.1 (52.6) (51.2)
391.0 353.5 (126.0) (111.2)
Segment total 782.1 731.4 (227.2) (209.2)
Central 15.5 7.7 (168.3) (161.8)
Total 797.6 739.1 (395.5) (371.0)
Exceptional items of £2.5m expense (2016: £36.3m credit), relate to Genus ABS (£6.9m expense), Genus PIC (£2.1m expense)
and our central segment (£6.5m credit). Note 3 provides details of these exceptional items.
We consider share-based payment expenses on a Group-wide basis and do not allocate them to reportable segments.
Geographical information
The analysis of revenue by geographical area is stated on the basis of where the legal entity is incorporated and therefore
in the country the revenue will be reported. The Group's revenue by geographical segment is analysed below:
Revenue
2017 2016
£m £m
North America 214.5 178.7
Latin America 71.4 58.6
Rest of Europe, Middle East and Africa 48.5 40.7
UK 70.0 65.2
Asia 54.7 45.1
459.1 388.3
Non-current assets (excluding deferred taxation and financial instruments)
2017£m 2016£m
North America 407.9 376.0
Latin America 47.2 43.2
Rest of Europe, Middle East and Africa 37.1 22.0
UK 60.9 59.6
Asia 14.8 17.5
567.9 518.3
Revenue by type
2017£m 2016£m
Sale of animals, semen, embryos and associated products and services 335.7 283.5
Royalties - animal and semen 116.1 97.8
Consulting services 7.3 7.0
459.1 388.3
Interest income (see note 4) 0.8 0.1
459.9 388.4
3. EXCEPTIONAL ITEMS
Operating (expense)/income: 2017£m 2016£m
Pension related 5.7 44.2
Litigation (5.3) (6.9)
Acquisition and integration (0.6) (0.2)
Other (including restructuring) (2.3) (0.8)
(2.5) 36.3
Pension related
On 23 June 2017, National Milk Records plc ('NMR') withdrew from the MPF under a Flexible Apportionment Arrangement between
NMR, Genus and the Trustees of the MPF. In return for the right to withdraw from the MPF, NMR made a one-off, lump sum cash
payment of £10.1m to the MPF, equivalent to the undiscounted value of all NMR's future payments under the existing MPF
recovery plan which extends to March 2026; and NMR also made a payment to Genus of £4.7m, with £1.4m being satisfied by the
issue NMR shares.
As a result of the NMR withdrawal, Genus has recognised £5.7m as an exceptional credit, with £4.5m (£4.7m payment net of
fees) being received directly from NMR, and £1.2m from the MPF pension scheme reflecting the impact of NMR paying
undiscounted amounts into the scheme. See note 11 for further details.
During the prior year, a gain of £43.9m arose as a result of changing the index used for pensions and deferred pension
increases in the Milk Pension Fund from RPI to CPI, and a £0.3m settlement gain arose from members leaving the same
scheme.
Litigation
Litigation includes legal fees of £5.3m (2016: £5.4m) related to the action by ABS Global, Inc. ('ABS') against Inguran,
LLC (aka Sexing Technologies ('ST')) and £nil (2016: £1.5m (US$2m)) for up-front damages related to patent infringement and
confidential information.
On 14 July 2014, ABS launched a legal action against ST in the US District Court for the Western District of Wisconsin
alleging, among other matters, that ST: (i) has a monopoly in the processing of sexed bovine semen in the US; and (ii)
unlawfully maintains this monopoly through anticompetitive conduct. The legal action aimed to remove these barriers and
allow free and fair competition in the sexed bovine semen processing market ('ABS Action'). In parallel with the ABS
Action, ABS also filed Inter-Partes Review applications ('IPR') before the US Patent Office challenging the validity of
several of ST's group patents, including US Patent No. 7,195,920 (the ''920 patent'), US Patent No. 7,820,425 (the ''425
patent'), US Patent No. 8,206,987 (the ''987 patent') and US Patent No. 8,198,092 (the ''092 patent').
ST and its subsidiary XY Inc. filed an Answer and Counterclaim to the ABS Action, denying any anticompetitive activities,
and alleging, among other matters, that the Company and ABS infringed the '920, '425, '987 and '092 patents.
On 29 April 2015, the Patent Trial and Appeal Board ('PTAB') ruled that ABS had not demonstrated a reasonable likelihood of
prevailing on its assertion that relevant claims of the '987 patent were invalid and declined to order the institution of a
trial. However, trials were instituted for the other three patents. On 11 January and 15 April 2016, the PTAB ruled that
the '920 and '425 patents were unpatentable. ST has appealed these decisions. The parties await a decision from the PTAB on
whether the '092 patent is unpatentable.
On 1 August 2016, the trial of the ABS Action commenced and lasted for approximately two weeks. Following the jury
verdicts, both sides filed post-trial motions. On 31 March 2017, the Court entered a judgment which confirmed: (i) the
Company and ABS had proved that ST had wilfully maintained a monopoly in the market for sexed bovine semen processing in
the US since July 2012, and awarded a permanent injunction against ST which, among other matters, relieved ABS of certain
research, marketing and other non-compete restrictions contained in the 2012 semen sorting agreement between the parties;
(ii) ST's '987 and '092 patents were valid and infringed; and (iii) that ABS had materially breached the confidentiality
obligations under the 2012 semen sorting agreement. The Court also confirmed that: (i) the Company and ABS should pay ST
an up-front amount of US$750,000 and an on-going royalty of US$1.25 per straw on commercialisation of the Genus Sexed Semen
technology for the use of ST's '987 patent in the US; (ii) the Company and ABS should pay ST an up-front payment of
US$500,000 and an on-going royalty of US$0.50 per straw for the use of ST's '092 patent in the US; and (iii) ABS should pay
ST damages of US$750,000 for having breached the confidentiality obligations under the 2012 semen sorting agreement. Both
parties have appealed the Court's decision.
On 7 June 2017, ST, XY LLC and Cytonome/ST, LLC filed proceedings against ABS Global, Inc., the Company and Premium
Genetics (UK) Limited ('PG') in the United States District Court for the Western District of Wisconsin ("New Litigation").
The New Litigation alleges that ABS and the Company infringe seven patents and asserts trade secret and breach of contract
claims. ABS, the Company and PG have filed a Motion to dismiss the trade secret and breach of contract claims. The
Company and ABS intend to vigorously defend the patent infringement claims.
Acquisitions and integration
During the period, £0.6m of expenses were incurred, with £1.6m of expenses in relation to acquisitions and integration,
principally of De Novo Genetics and Hermitage Genetics, being partially offset by a gain on cancellation of the IVB put
option.
Other (including restructuring)
Included within 'other' of £2.3m is £1.8m restructuring costs primarily relating to ABS operating business, especially
supply chain.
4. NET FINANCE COSTS
2017£m 2016£m
Interest payable on bank loans and overdrafts (2.7) (1.7)
Amortisation of debt issue costs (0.4) (0.5)
Other interest payable (0.1) (0.1)
Net interest cost in respect of pension scheme liabilities (1.2) (2.2)
Net interest cost on derivative financial instruments (0.1) (0.2)
Total interest expense (4.5) (4.7)
Interest income on bank deposits 0.8 0.1
Total interest income 0.8 0.1
Net finance costs (3.7) (4.6)
5. INCOME TAX EXPENSE
Income tax expense 2017£m 2016£m
Current tax expense
Current period 9.9 10.4
Adjustment for prior periods 0.4 (1.4)
Total current tax expense in the Group Income Statement 10.3 9.0
Deferred tax expense
Origination and reversal of temporary differences (2.6) 0.7
Adjustment for prior periods (1.3) 0.9
Total deferred tax expense in the Group Income Statement (3.9) 1.6
Total income tax expense excluding share of income tax ofequity accounted investees 6.4 10.6
Share of income tax of equity accounted investees 1.4 1.4
Total income tax expense in the Group Income Statement 7.8 12.0
6. EARNINGS PER SHARE
Basic earnings per share is the profit generated for the financial year attributable to equity shareholders divided by the
weighted average number of shares in issue during the year.
Basic earnings per share from continuing operations 2017 2016
Basic earnings per share 53.8p 81.1p
The calculation of basic earnings per share from continuing operations for the year ended 30 June 2017 is based on the net
profit attributable to owners of the Company from continuing operations of £32.8m (2016: £49.3m) and a weighted average
number of ordinary shares outstanding of 60,944,000 (2016: 60,814,000), which is calculated as follows:
Weighted average number of ordinary shares (basic) 2017000s 2016000s
Issued ordinary shares at the start of the year 61,013 60,968
Effect of own shares held (163) (177)
Shares issued on exercise of stock options 47 23
Shares issued in relation to Employee Benefit Trust 47 -
Weighted average number of ordinary shares in year 60,944 60,814
Diluted earnings per share from continuing operations 2017 2016
Diluted earnings per share 53.0p 80.3p
The calculation of diluted earnings per share from continuing operations for the year ended 30 June 2017 is based on the
net profit attributable to owners of the Company from continuing operations of £32.8m (2016: £49.3m) and a weighted average
number of ordinary shares outstanding, after adjusting for the effects of all potential dilutive ordinary shares, of
61,833,000 (2016: 61,387,000), which is calculated as follows:
Weighted average number of ordinary shares (diluted) 2017000s 2016000s
Weighted average number of ordinary shares (basic) 60,944 60,814
Dilutive effect of share options 889 573
Weighted average number of ordinary shares for the purposes of diluted earnings per share 61,833 61,387
Adjusted earnings per share from continuing operations 2017 2016
Adjusted earnings per share 69.4p 60.7p
Diluted adjusted earnings per share 68.4p 60.1p
Adjusted earnings per share is calculated on profit before net IAS 41 valuation movement on biological assets, amortisation
of acquired intangible assets, share-based payment expense and exceptional items, after charging taxation associated with
those profits, of £42.3m (2016: £36.9m), which is calculated as follows:
2017£m 2016£m
Profit before tax from continuing operations 40.7 60.9
Add/(deduct):
Net IAS 41 valuation movement on biological assets 1.1 17.1
Amortisation of acquired intangible assets 8.7 6.1
Share-based payment expense 4.6 3.8
Exceptional items (see note 3) 2.5 (36.3)
Net IAS 41 valuation movement on biological assets in joint ventures (0.5) (1.9)
Tax on joint ventures and associates 1.4 1.4
Attributable to non-controlling interest (2.1) (1.4)
Adjusted profit before tax 56.4 49.7
Adjusted tax charge (14.1) (12.8)
Adjusted profit after tax 42.3 36.9
Effective tax rate on adjusted profit 25.0% 25.8%
7. DIVIDENDS
Amounts recognised as distributions to equity holders in the year
2017£m 2016£m
Final dividend
Final dividend for the year ended 30 June 2016 of 14.7 pence pershare 9.0 -
Final dividend for the year ended 30 June 2015 of 13.4 pence pershare - 8.1
Interim dividend
Interim dividend for the year ended 30 June 2017 of 7.4 penceper share 4.5 -
Interim dividend for the year ended 30 June 2016 of 6.7 penceper share - 4.1
13.5 12.2
The Directors have proposed a final dividend of 16.2 pence per share for 2017. This is subject to shareholders' approval
at the Annual General Meeting and we have therefore not included it as a liability in these financial statements.
8. INTANGIBLE ASSETS
Technology Brand, multiplier contracts and customer relationships Separately identified acquired intangible assets Software Genus Sexed Semen Patents, licence and other Total Goodwill
£m £m £m £m £m £m £m £m
Cost
Balance at 1 July 2015 46.1 61.5 107.6 6.6 11.1 0.3 125.6 73.9
Additions - - - - 4.6 2.2 6.8 -
Acquisition - 0.7 0.7 - - - 0.7 1.9
Effect of movements in exchange rates 0.5 10.5 11.0 0.3 2.1 0.1 13.5 10.2
Balance at 30 June 2016 46.6 72.7 119.3 6.9 17.8 2.6 146.6 86.0
Additions - - - 0.9 3.1 1.5 5.5 -
Acquisition (see note 14) 6.7 7.4 14.1 - - - 14.1 16.2
Reclassified from tangible fixed assets - - - 1.0 - - 1.0 -
Effect of movements in exchange rates 0.1 2.2 2.3 - 0.4 - 2.7 2.5
Balance at 30 June 2017 53.4 82.3 135.7 8.8 21.3 4.1 169.9 104.7
Amortisation and impairment losses
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