REG - Hays PLC - Final Results <Origin Href="QuoteRef">HAYS.L</Origin> - Part 2
27/08/2015 07:04
- Part 2: For the preceding part double click ID:nRSa2198Xa
- - - 1.2 - - 1.2
Net expense recognised in other comprehensive income - - - (20.6) (21.4) 0.4 (41.6)
Profit for the year - - - 90.9 - - 90.9
Total comprehensive income for the year - - - 70.3 (21.4) 0.4 49.3
Dividends paid - - - (35.1) - - (35.1)
Share-based payments - - - 10.1 - (1.7) 8.4
Tax on share-based payment transactions - - - 1.3 - - 1.3
Other share movements - - - - - 0.4 0.4
At 30 June 2014 14.7 369.6 2.7 (197.7) 33.4 18.0 240.7
CONSOLIDATED CASH FLOW STATEMENT
FOR THE YEAR ENDED 30 JUNE
(In £s million) Note 2015 2014
Operating profit from continuing operations 164.1 140.3
Adjustments for:
Exceptional items (0.1) (0.2)
Depreciation of property, plant and equipment 8.7 9.2
Amortisation of intangible fixed assets 13.7 12.9
Loss on disposal of property, plant and equipment - 0.5
Net movements in provisions and other items (0.4) (2.0)
Share-based payments 10.8 8.7
32.7 29.1
Operating cash flow before movement in working capital 196.8 169.4
Movement in working capital:
Increase in receivables (53.0) (32.6)
Increase in payables 45.9 38.6
(7.1) 6.0
Cash generated by operations 189.7 175.4
Pension scheme deficit funding (14.0) (13.5)
Income taxes paid (43.6) (59.3)
Net cash inflow from operating activities 132.1 102.6
Investing activities
Purchase of property, plant and equipment (7.8) (5.7)
Proceeds from sales of business and related assets 0.2 0.1
Purchase of intangible assets (4.3) (6.1)
Acquisition of subsidiaries (35.7) -
Cash paid in respect of acquisitions made in previous years (1.6) (0.3)
Interest received 0.5 0.5
Net cash used in investing activities (48.7) (11.5)
Financing activities
Interest paid (5.7) (8.4)
Equity dividends paid (37.9) (35.1)
Proceeds from exercise of share options 1.8 0.6
Decrease in bank loans and overdrafts (10.2) (34.5)
Net cash used in financing activities (52.0) (77.4)
Net increase 31.4 13.7
Cash and cash equivalents at beginning of year 11 48.0 40.0
Effect of foreign exchange rate movements (9.6) (5.7)
Cash and cash equivalents at end of year 11 69.8 48.0
NOTES TO THE CONSOLIDATED FINANCIAL
STATEMENTS
1 STATEMENT UNDER S435 - PUBLICATION OF NON-STATUTORY ACCOUNTS
The financial information set out in
this preliminary announcement does
not constitute statutory accounts
for the years ended 30 June 2015 or
2014, for the purpose of the
Companies Act 2006, but is derived
from those accounts. The statutory
accounts for 2014 have been
delivered to the Registrar of
Companies and those for 2015 will be
delivered following the Company's
Annual General Meeting. The Group's
Auditor has reported on those
accounts; their reports were
unqualified, did not draw attention
to any matters by way of emphasis
without qualifying their report and
did not contain statements under
Section 498(2) or (3) of the
Companies Act 2006.
2 BASIS OF PREPARATION
Whilst the financial information
included in this preliminary
announcement has been prepared in
accordance with the International
Financial Reporting Standards
(IFRSs) as adopted for use in the
European Union and as issued by the
International Accounting Standards
Board, this announcement does not
itself contain sufficient
information to comply with IFRS. The
accounting policies applied in
preparing this financial information
are consistent with the Group's
financial statements for the year
ended June 2014 with the exception
of the following new accounting
standards and amendments which were
mandatory for accounting periods
beginning on or after 1 January
2014, none of which had any material
impact on the Group's results or
financial position.
· IFRS 10 Consolidated Financial Statements (EU adoption from 1 January 2014)
· IFRS 11 Joint Arrangements (EU adoption from 1 January 2014)
· IFRS 12 Disclosure of Interests in Other Entities (EU adoption from 1 January 2014)
· IFRS 10, IFRS 12 and IAS 27 (amendments) Investment Entities (effective 1 January 2014)
· IAS 27 (revised) Separate Financial Statements (EU adoption from 1 January 2014)
· IAS 28 (revised) Investments in Associates and Joint Ventures (EU adoption from 1 January 2014)
· IAS 32 (amendment) Presentation - Offsetting Financial Assets and Financial Liabilities (effective 1 January 2014)
· IAS 36 (amendment) Recoverable Amount Disclosures for Non-Financial Assets (effective 1 January 2014)
· IFRIC 21 (interpretation) Levies (effective 1 January 2014)
Going Concern
The Group's business activities,
together with the factors likely to
effect its future development,
performance and financial position,
including its cash flows and
liquidity position are described in
this preliminary results
announcement for the year ended 30
June 2015. The directors have formed
the judgement that there is
reasonable expectation that the
Group has adequate resources to
continue in operational existence
for the foreseeable future. As a
result the directors continue to
adopt the going concern basis in the
preparation of the financial
statements.
3 SEGMENTAL INFORMATION
The Group's continuing operations
comprise one class of business, that
of qualified, professional and
skilled recruitment.
The Group's Management Board, which
is regarded as the chief operating
decision maker, uses net fees by
segment as its measure of revenue in
internal reports, rather than use
turnover. This is because net fees
exclude the remuneration of
temporary workers, and payments to
other recruitment agencies where the
Group acts as principal, which are
not considered relevant in
allocating resources to segments.
The Group's Management Board
considers net fees for the purpose
of making decisions about allocating
resources. The Group does not report
items below operating profit by
segment in its internal management
reporting. The reconciliation of
turnover to net fees can be found in
note 4.
(In £s million) 2015 2014
Net fees from continuing operations
Asia Pacific 178.5 173.9
Continental Europe & Rest of World 313.8 305.0
United Kingdom & Ireland 271.9 246.0
764.2 724.9
3 SEGMENTAL INFORMATION continued
(In £s million) 2015 2014
Operating profit from continuing
operations
Asia Pacific 49.7 49.7
Continental Europe & Rest of World 68.7 64.4
United Kingdom & Ireland 45.7 26.2
164.1 140.3
4 OPERATING PROFIT FROM CONTINUING OPERATIONS
The following costs are deducted
from turnover to determine net fees
from continuing operations:
(In £s million) 2015 2014
Turnover 3,842.8 3,678.5
Remuneration of temporary workers (2,941.5) (2,805.8)
Remuneration of other recruitment (137.1) (147.8)
agencies
Net fees 764.2 724.9
Operating profit is stated after
charging the following items to net
fees of £764.2 million (2014: £724.9
million):
(In £s million) 2015 2014
Staff costs 440.6 424.4
Depreciation of property, plant and 8.7 9.2
equipment
Amortisation of intangible assets 13.7 12.9
Operating lease rentals payable 30.8 31.2
Impairment loss on trade receivables 2.5 3.4
Auditor remuneration
- for statutory audit services 0.9 0.9
- for other services 0.4 0.3
Other external charges 102.5 102.3
600.1 584.6
5 FINANCE INCOME AND FINANCE COST
Finance income
(In £s million) 2015 2014
Interest on bank deposits 0.5 0.5
Finance cost
(In £s million) 2015 2014
Interest payable on bank loans and (4.6) (5.5)
overdrafts
Interest unwind on acquisition (0.4) -
liability
Pension Protection Fund levy (0.5) (0.4)
Net interest on pension obligations (3.0) (2.6)
(8.5) (8.5)
Net finance cost (8.0) (8.0)
6 INCOME TAXES RELATING TO CONTINUING OPERATIONS
The income tax expense for the year
can be reconciled to the accounting
profit as follows:
(In £s million) 2015 2014
Profit before tax from continuing 156.1 132.3
operations
Income tax expense calculated at (32.4) (29.8)
20.75% (2014: 22.50%)
Net effect of items that are non (3.7) 1.3
-taxable/(non-deductible) in
determining taxable profit
Effect of unused tax losses not - (1.5)
recognised as deferred tax assets
Effect of different tax rates of (13.8) (11.6)
subsidiaries operating in other
jurisdictions
Effect on deferred tax balances due (0.8) (1.8)
to the changes in income tax rates
Effect of share-based payment 0.5 (0.1)
charges and share options
(50.2) (43.5)
Adjustments recognised in the (0.2) (2.8)
current year in relation to the
current tax of prior years
Adjustments to deferred tax in (0.3) -
relation to prior years
Income tax expense recognised in the (50.7) (46.3)
Consolidated Income Statement
relating to continuing operations
Effective tax rate for the year on 32.5% 35.0%
continuing operations
The tax rate used for the 2015 and
2014 reconciliations above is the
corporate tax rate of 20.75% (2014:
22.50%) payable by corporate
entities in the United Kingdom on
taxable profits under tax law in
that jurisdiction.
7 DIVIDENDS
The following dividends were paid by
the Group and have been recognised
as distributions to equity
shareholders in the year:
2015 2014
pence per 2015 pence per 2014
share £s million share £s million
Previous year final dividend 1.80 25.6 1.67 23.5
Current year interim dividend 0.87 12.3 0.83 11.6
37.9 35.1
The following dividends have been
paid/proposed by the Group in
respect of the accounting year
presented:
2015 2014
pence per 2015 pence per 2014
share £s million share £s million
Interim dividend (paid) 0.87 12.3 0.83 11.6
Final dividend (proposed) 1.89 27.0 1.80 25.6
2.76 39.3 2.63 37.2
The final dividend for 2015 of 1.89
pence per share (£27.0 million) will
be proposed at the Annual General
Meeting on 11 November 2015 and has
not been included as a liability as
at 30 June 2015. If approved, the
final dividend will be paid on 13
November 2015 to shareholders on the
register at the close of business on
9 October 2015.
8 EARNINGS PER SHARE
Weighted
average
number of Per share
Earnings shares amount
For the year ended 30 June 2015 (£s million) (million) (pence)
Continuing operations:
Basic earnings per share from 105.4 1,416.4 7.44
continuing operations
Dilution effect of share options - 24.5 (0.13)
Diluted earnings per share from 105.4 1,440.9 7.31
continuing operations
Discontinued operations:
Basic earnings per share from 0.2 1,416.4 0.01
discontinued operations
Dilution effect of share options - 24.5 -
Diluted earnings per share from 0.2 1,440.9 0.01
discontinued operations
Continuing and discontinued
operations:
Basic earnings per share from 105.6 1,416.4 7.46
continuing and discontinued
operations
Dilution effect of share options - 24.5 (0.13)
Diluted earnings per share from 105.6 1,440.9 7.33
continuing and discontinued
operations
Weighted
average
number of Per share
Earnings shares amount
For the year ended 30 June 2014 (£s million) (million) (pence)
Continuing operations:
Basic earnings per share from 86.0 1,403.9 6.13
continuing operations
Dilution effect of share options - 30.0 (0.13)
Diluted earnings per share from 86.0 1,433.9 6.00
continuing operations
Discontinued operations:
Basic earnings per share from 4.9 1,403.9 0.35
discontinued operations
Dilution effect of share options - 30.0 (0.01)
Diluted earnings per share from 4.9 1,433.9 0.34
discontinued operations
Continuing and discontinued
operations:
Basic earnings per share from 90.9 1,403.9 6.47
continuing and discontinued
operations
Dilution effect of share options - 30.0 (0.13)
Diluted earnings per share from 90.9 1,433.9 6.34
continuing and discontinued
operations
The weighted average number of
shares in issue for both years
exclude shares held in treasury and
shares held by the Hays plc Employee
Share Trust.
9 RETIREMENT BENEFIT OBLIGATIONS
(In £s million) 2015 2014
Deficit in the scheme brought (43.9) (33.0)
forward
Current service cost (1.3) (1.3)
Employer contributions 14.0 13.5
Net interest expense (1.7) (1.3)
Remeasurement of the net defined (25.8) (21.8)
benefit liability
Deficit in the scheme carried (58.7) (43.9)
forward
10 PROVISIONS
(In £s million) Property Other Total
At 1 July 2014 5.3 10.1 15.4
Exchange adjustments - (0.1) (0.1)
Charged to income statement - 2.2 2.2
Credited to income statement (2.2) - (2.2)
Utilised (0.2) (0.2) (0.4)
At 30 June 2015 2.9 12.0 14.9
(In £s million) 2015 2014
Current 3.0 3.4
Non-current 11.9 12.0
14.9 15.4
Property provisions are for rents
and other related amounts payable on
certain leased properties for
periods in which they are not
anticipated to be in use by the
Group. The leases expire in periods
up to 2015 and the amounts will be
paid over this period.
Other provisions mainly relate to
potential warranty claim liabilities
arising as a result of the business
disposals that were concluded in
2004, and deferred employee benefit
provisions. Of these provisions,
£3.0 million is expected to be paid
in the next 12 months and it is not
possible to estimate the timing of
the payments for the other items.
11 MOVEMENT IN NET DEBT
1 July Cash Exchange 30 June
(In £s million) 2014 flow movement 2015
Cash and cash equivalents 48.0 31.4 (9.6) 69.8
Bank loans and overdrafts (110.7) 10.2 - (100.5)
Net debt (62.7) 41.6 (9.6) (30.7)
The table above is presented as
additional information to show
movement in net debt,
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