Change in Presentational Currency
28/06/2024 07:01
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RNS Number : 2527U Keywords Studios PLC 28 June 2024
28 June 2024
Keywords Studios plc ("Keywords Studios", "Keywords", the "Group")
Change in Presentational Currency
Keywords Studios, the global provider of creative and technology-enabled
solutions to the video games and entertainment industries, today announces
that it has decided to change its presentational currency from euro to US
Dollar with effect from 1 January 2024.
The Company has historically reported its results in euros due its revenues
being solely euro denominated in the early stages of its development. As the
business has grown into a global business, it now operates in a range of
currencies, with the proportion of the Group's revenues originating in US
dollars growing to c.60% in recent years. As such, the Board believes that the
change in presentational currency will provide investors and other
stakeholders with greater transparency of the Group's performance and reduced
foreign exchange volatility.
Dividends will continue to be declared in sterling and will continue to follow
the existing progressive dividend policy.
As noted above, the change in the Group's presentational currency will be
effective from 1 January 2024. Consequently, the Group's first half results
for the six-month period ending 30 June 2024, and all subsequent financial
information, will be prepared using US dollars as the presentational currency.
The Group's primary consolidated financial statements, together with
alternative performance measures, for the financial years ended 31 December
2022 and 31 December 2023, and for the half ended on 30 June 2023
(collectively the 'Restated Financial Information'), has been re-presented in
US dollars and is set out herein for comparative purposes.
For further information, please contact:
Keywords Studios Deutsche Numis
Giles Blackham Nomad & Joint Corporate Broker
Director of Investor Relations Stuart Skinner / Will Baunton
+44 7714 134 681 +44 20 7260 1000
gblackham@keywordsstudios.com (mailto:gblackham@keywordsstudios.com)
MHP Group Barclays
Financial Communications Joint Corporate Broker
Katie Hunt / Eleni Menikou / Charles Hirst Tom Macdonald / Stuart Jempson
+44 7884 494 112 / +44 20 3128 8100 +44 20 7029 8000
keywords@mhpgroup.com (mailto:keywords@mhpgroup.com)
About Keywords Studios (www.keywordsstudios.com
(https://protect.checkpoint.com/v2/___http:/www.keywordsstudios.com/___.bXQtcHJvZC1jcC1ldXcyLTE6bmV4dDE1OmM6bzozM2I0NmViNTMxYTRkMDljMTRlNWIxYmUzZGU4N2QyZjo2OjlkOGI6MWY3NDBlOGVhNjI4YTcxMTlkODgwZGNiYjgwNjU0Mzc5ZWVkMjAxZDk2YzQwYzNjOTI5NTkyZmM4NjFmN2ZmMzpwOkY6Tg)
)
Keywords Studios is a global provider of creative and technology-enabled
solutions to the video games and entertainment industries. Established in
1998, and now with over 70 facilities in 26 countries strategically located in
Asia, Australia, the Americas, and Europe, it provides services across the
entire content development life cycle through its Create, Globalize and Engage
Divisions to a large blue-chip client base across the globe.
Keywords Studios has a strong market position, providing services to 24 of the
top 25 most prominent games companies and contributing to over 70% of the 2023
Game Awards winners. Across the games and entertainment industry, clients
include Activision Blizzard, Bandai Namco, Bethesda, Electronic Arts, Epic
Games, Konami, Microsoft, Netflix, Riot Games, Square Enix, Supercell,
Take-Two, Tencent and Ubisoft. Recent titles worked on include Starfield,
Baldur's Gate 3, Diablo IV, Hogwarts Legacy, Elden Ring, Fortnite, Valorant,
League of Legends and Clash Royale. Keywords Studios is listed on AIM, the
London Stock Exchange regulated market (KWS.L).
Unaudited (Restated) Consolidated statement of comprehensive income
Year ended Half Year Year ended
31 December 30 June 31 December
2023 2023 2022
$'000 $'000 $'000
Revenue from contracts with customers 842,609 413,274 725,817
Cost of sales (519,696) (256,743) (445,027)
Gross profit 322,913 156,531 280,790
Other income - - 1,220
Share-based payments expense (23,743) (10,177) (19,689)
Costs of acquisition and integration (29,424) (7,876) (8,673)
Amortisation of intangible assets (28,150) (13,771) (17,725)
Total of items excluded from adjusted profit measures (81,317) (31,824) (46,087)
Other administration expenses (192,339) (93,017) (160,360)
Administrative expenses (273,656) (124,841) (206,447)
Operating profit 49,257 31,690 75,563
Financing income 666 165 2,096
Financing cost (13,453) (6,789) (6,121)
Profit before taxation 36,470 25,066 71,538
Taxation (16,226) (9,407) (21,736)
Profit after taxation 20,244 15,659 49,802
Other comprehensive income:
Items that will not be reclassified subsequently to profit or loss
Actuarial gain / (loss) on defined benefit plans 17 (160) 300
Items that may be reclassified subsequently to profit or loss
Exchange gain / (loss) in net investment in foreign operations 4,026 1,201 (12,081)
Exchange gain / (loss) on translation of foreign operations 6,116 6,745 (18,726)
Non-controlling interest; recycled on disposal of subsidiary - - 180
Tax related to items taken to other comprehensive income 1,337 - -
Total comprehensive income / (expense) 31,740 23,445 19,475
Profit / (loss) for the period attributable to:
Owners of the parent 20,244 15,659 49,850
Non-controlling interest - - (48)
20,244 15,659 49,802
Total comprehensive income / (expense) attributable to:
Owners of the parent 31,740 23,445 19,475
31,740 23,445 19,475
Earnings per share $ cent $ cent $ cent
Basic earnings per ordinary share 25.65 19.93 64.70
Diluted earnings per ordinary share 25.31 19.20 61.88
Unaudited (Restated) Consolidated statement of financial position
At 31 December At 30 June At 31 December
2023 2023 2022
$'000 $'000 $'000
Non-current assets
Intangible assets 697,772 624,354 501,286
Right of use assets 46,362 48,131 40,181
Property, plant and equipment 55,458 58,191 47,766
Deferred tax assets 36,155 33,311 33,232
Investments 193 190 187
835,940 764,177 622,652
Current assets
Cash and cash equivalents 66,083 47,632 87,339
Trade receivables 99,275 103,345 87,001
Other receivables 91,992 98,185 65,468
Corporation tax recoverable 6,614 6,392 6,937
263,964 255,554 246,745
Current liabilities
Trade payables 15,780 16,081 16,935
Other payables 172,168 175,100 148,636
Loans and borrowings - - 48
Corporation tax liabilities 29,895 26,224 23,495
Lease liabilities 15,302 16,762 13,241
233,145 234,167 202,355
Net current assets / (liabilities) 30,819 21,387 44,390
Non-current liabilities
Other payables 13,251 21,067 19,527
Employee defined benefit plans 4,448 3,913 3,052
Loans and borrowings 140,618 59,997 7
Deferred tax liabilities 11,378 17,138 18,151
Lease liabilities 36,549 37,186 32,110
206,244 139,301 72,847
Net assets 660,515 646,263 594,195
Equity
Share capital 1,155 1,153 1,139
Share capital - to be issued 349 2,849 2,462
Share premium 64,956 64,906 56,795
Merger reserve 352,504 347,573 330,645
Foreign exchange reserve (31,180) (33,376) (41,322)
Shares held in Employee Benefit Trust ("EBT") (7,251) (1,050) -
Share-based payments reserve 90,005 79,580 73,786
Retained earnings 189,977 184,628 170,690
Total equity 660,515 646,263 594,195
Unaudited (Restated) Consolidated statement of cash flows
Year Ended Half Year Year Ended
31 December 30 June 31 December
2023 2023 2022
$'000 $'000 $'000
Cash flows from operating activities
Profit after taxation 20,244 15,659 49,802
Income and expenses not affecting operating cash flows
Depreciation and impairment - property, plant and equipment 31,225 11,769 19,241
Depreciation and impairment - right of use assets 17,205 8,422 15,133
Amortisation and impairment of intangible assets 28,150 13,771 17,725
Taxation 16,226 9,407 21,736
Share-based payments expense 23,743 10,177 19,689
Fair value movements in deferred and contingent consideration 9,945 4,668 2,369
Non-cash movements included in costs of acquisition and integration 2,899 - -
Unwinding of discounted liabilities - deferred consideration 3,543 1,963 3,085
Unwinding of discounted liabilities - lease liabilities 1,562 680 1,005
Interest receivable (666) (165) (326)
Fair value adjustments to employee defined benefit plans 1,243 721 538
Interest expense 6,235 2,408 1,336
Unrealised foreign exchange (gain) / loss (1,201) (3,762) (681)
140,109 60,059 100,850
Changes in operating assets and liabilities
Decrease / (increase) in trade receivables (228) (9,994) (12,466)
Decrease / (increase) in MMTC and VGTR receivable (12,159) (17,917) (3,779)
Decrease / (increase) in other receivables (7,672) (12,397) (6,497)
(Decrease) / increase in accruals, trade and other payables 8,206 2,697 19,754
(11,853) (37,611) (2,988)
Taxation paid (22,645) (8,575) (18,285)
Settlement of deferred and contingent consideration related to continuous (4,222) - -
employment
Net cash generated by / (used in) operating activities 121,633 29,532 129,379
Cash flows from investing activities
Current year acquisition of subsidiaries net of cash acquired (174,479) (82,183) (91,280)
Settlement of deferred liabilities on acquisitions (33,020) (10,943) (27,655)
Acquisition of property, plant and equipment (33,204) (20,350) (28,211)
Investment in intangible assets (3,305) (1,428) (523)
Interest received 666 165 326
Net cash generated by / (used in) investing activities (243,342) (114,739) (147,343)
Cash flows from financing activities
Cash proceeds, where EBT shares were utilised for the exercise of share-based 1,240 323 544
payments
Repayment of loans (105,176) (35,047) (89)
Drawdown of loans 244,804 95,000 -
Payments of principal on lease liabilities (16,476) (7,351) (11,788)
Interest paid on principal of lease liabilities (1,562) (680) (1,005)
Dividends paid (2,311) (1,561) (2,053)
Company funded acquisition of shares by EBT (15,991) (5,075) -
Shares issued for cash 1,647 1,618 7,029
Interest paid (6,796) (1,887) (879)
Net cash generated by / (used in) financing activities 99,379 45,340 (8,241)
Increase / (decrease) in cash and cash equivalents (22,330) (39,867) (26,205)
Exchange gain / (loss) on cash and cash equivalents 1,074 160 (6,187)
Cash and cash equivalents at beginning of the period 87,339 87,339 119,731
Cash and cash equivalents at end of the period 66,083 47,632 87,339
Notes forming part of the unaudited (restated) consolidated financial
statements
1 Basis of Preparation
The unaudited (restated) financial information should be read in conjunction
with the Annual Report and Accounts for the year ended 31 December 2023; and
the interim financial information for the six months ended 30 June 2023 all of
which have been prepared in accordance with International Financial Reporting
Standards ('IFRS'). The statutory accounts for the year ended 31 December 2023
were approved by the directors on 13 March 2024.
2 Presentation Currency
Keywords Studios plc (the "Group") will present its consolidated financial
statements for the year ending 31 December 2024 in US Dollars. In accordance
with IAS 8, Accounting Policies, Changes in Accounting Estimates and Errors,
this change in presentation currency will be applied retrospectively.
The unaudited (restated) financial information included herein will form the
basis of the comparative financial information to be included in the Annual
Report and Accounts of the Group for the year ending 31 December 2024 and all
published financial information from 1 January 2024 onwards.
In accordance with the provisions of IAS 21, the Effects of Changes in Foreign
Exchange Rates, in respect of changes in presentational currency, financial
information has been restated from Euro to US Dollars as follows:
• assets and liabilities in non-US denominated currencies
were translated into US dollars at the rates of exchange ruling at the
relevant balance sheet date;
• non-US dollar income statements and cash flows were
translated into US dollars at average rates of exchange for the relevant
period;
• share capital, share premium and all other equity items
were translated at the historical rates prevailing at 1 January 2013, the date
of transition to IFRS, or the subsequent rates prevailing on the date of each
relevant transaction; and
• the cumulative foreign exchange translation reserve was
set to zero on 1 January 2013, the date of transition to IFRS and this reserve
has been restated on the basis that the Group has reported in US dollars since
that date.
Year Ended Half Year Year Ended
31 December 30 June 31 December
Average 2023 2023 2022
Euro 1.08 1.08 1.06
Sterling 1.23 1.23 1.31
Canadian Dollar 0.74 0.74 0.79
Period end
Euro 1.10 1.09 1.07
Sterling 1.27 1.27 1.20
Canadian Dollar 0.75 0.75 0.74
Restated Alternative Performance Measures
The Group reports a number of alternative performance measures ("APMs") to
present the financial performance of the business, that are not GAAP measures
as defined under IFRS. The Directors believe that these measures, in
conjunction with the IFRS financial information, provide the users of the
financial statements with additional information to provide a more meaningful
understanding of the underlying financial and operating performance of the
Group. The measures are also used in the Group's internal strategic planning
and budgeting processes and for setting internal management targets.
These measures can have limitations as analytical tools and therefore should
not be considered in isolation, or as a substitute for IFRS measures. APM's
may not be calculated uniformly by all companies and therefore may not be
directly comparable with similarly titled measures and disclosures of other
companies. As these measures frequently exclude significant recurring
transactions that impact financial performance (e.g. share-based payments
expense), the adjusted measures will typically be higher than the
corresponding IFRS measures and should not be regarded as a complete picture
of the Group's financial performance, which is presented in the Total
comprehensive income / (expense) of the Group.
The Restated Alternative performance measures should be read in conjunction
with the Annual Report and Accounts for the year ended 31 December 2023; and
the interim financial information for the six months ended 30 June 2023.
Divisional analysis
The following table presents revenue growth by division at actual exchange
rates ("AER").
Full Year Half Year Full Year Full Year Half Year Full Year
31 December 30 June 31 December 31 December 30 June 31 December
2023 2023 2022 2023 2023 2022
Revenue Revenue Revenue Growth Growth Growth
AER AER AER AER AER AER
$m $m $m % % %
Create 363.0 175.5 290.1 25.1% 28.5% 29.6%
Globalize 301.6 156.8 316.0 (4.6%) 0.8% 14.6%
Engage 178.0 81.0 119.7 48.7% 33.2% 9.3%
842.6 413.3 725.8 16.1% 17.1% 19.2%
Pro forma revenue
Pro forma revenue is calculated by adding pre-acquisition revenues of current
year acquisitions to the current year revenue numbers, to illustrate the size
of the Group had the acquisitions been included from the start of the
financial year.
Full Year Full Year Full Year
31 December 31 December 31 December
2023 2023 2023
Revenue Pre-acquisition revenue Pro forma Revenue
AER AER AER
$m $m $m
Create 363.0 47.2 410.2
Globalize 301.6 1.1 302.7
Engage 178.0 6.9 184.9
842.6 55.2 897.8
Organic revenue at constant exchange rates
Organic revenue at constant exchange rates is calculated by adjusting the
prior year revenues, adding pre-acquisition revenues for the corresponding
period of ownership, and applying the prior period foreign exchange rates to
the current periods, when translating studio results into the US Dollar
reporting currency.
Full Year Half Year Full Year
31 December 30 June 31 December
2023 2023 2022
Organic revenue growth Organic revenue growth Organic revenue growth
% % %
Create 17.3% 22.1% 25.9%
Globalize (4.3%) 4.7% 23.4%
Engage 2.3% - 9.7%
5.6% 10.4% 21.8%
Adjusted operating costs
This comprises Administrative expenses as reported in the Consolidated
statement of comprehensive income, adding back share-based payments expense,
costs of acquisition and integration, amortisation of intangible assets,
depreciation and impairment, and deducting bank charges.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Administrative expenses (273,656) (124,841) (206,447)
Share-based payments expense 23,743 10,177 19,689
Costs of acquisition and integration 29,424 7,876 8,673
Amortisation of intangible assets 28,150 13,771 17,725
Depreciation - property, plant and equipment 24,995 11,769 19,241
Depreciation - right of use assets 14,995 8,422 15,133
Bank charges (781) (380) (695)
Adjusted operating costs (153,130) (73,206) (126,681)
Adjusted operating costs as a % of revenue 18.2% 17.7% 17.5%
Adjusted operating profit
The Adjusted operating profit consists of the Operating profit as reported in
the Consolidated statement of comprehensive income, adjusted for share-based
payments expense, costs of acquisition and integration, and amortisation of
intangible assets. In order to present the measure consistently year-on-year,
the impact of other income is also excluded.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Operating profit 49,257 31,690 75,563
Share-based payments expense 23,743 10,177 19,689
Costs of acquisition and integration 29,424 7,876 8,673
Amortisation of intangible assets 28,150 13,771 17,725
Other income - - (1,220)
Adjusted operating profit 130,574 63,514 120,430
Adjusted operating profit as a % of revenue 15.5% 15.4% 16.6%
EBITDA
EBITDA comprises Operating profit as reported in the Consolidated statement of
comprehensive income, adjusted for amortisation of intangible assets,
depreciation and impairment, and deducting bank charges.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Operating profit 49,257 31,690 75,563
Amortisation of intangible assets 28,150 13,771 17,725
Depreciation - property, plant and equipment 24,995 11,769 19,241
Depreciation - right of use assets 14,995 8,422 15,133
Bank charges (781) (380) (695)
EBITDA 116,616 65,272 126,967
Adjusted EBITDA
Adjusted EBITDA comprises EBITDA, adjusted for share-based payments expense,
and costs of acquisition and integration. In order to present the measure
consistently year-on-year, the impact of other income is also excluded.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
EBITDA 116,616 65,272 126,967
Share-based payments expense 23,743 10,177 19,689
Costs of acquisition and integration 29,424 7,876 8,673
Other income - - (1,220)
Adjusted EBITDA 169,783 83,325 154,109
Adjusted EBITDA as a % of revenue 20.1% 20.2% 21.2%
Adjusted profit before tax
Adjusted profit before tax comprises Profit before taxation as reported in the
Consolidated statement of comprehensive income, adjusted for share-based
payments expense, costs of acquisition and integration, amortisation of
intangible assets, foreign exchange gains and losses, and unwinding of
discounted liabilities. In order to present the measure consistently
year-on-year, the impact of other income is also excluded.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Profit before taxation 36,470 25,066 71,538
Share-based payments expense 23,743 10,177 19,689
Costs of acquisition and integration 29,424 7,876 8,673
Amortisation of intangible assets 28,150 13,771 17,725
Foreign exchange (gain) / loss 1,332 1,358 (1,770)
Unwinding of discounted liabilities - deferred consideration 3,543 1,963 3,085
Other income - - (1,220)
Adjusted profit before tax 122,662 60,211 117,720
Adjusted profit before tax as a % of revenue 14.6% 14.6% 16.2%
Adjusted effective tax rate
The Adjusted effective tax rate is the Taxation expense as reported in the
Consolidated statement of comprehensive income, adjusted for the tax impact of
the adjusting items in arriving at Adjusted profit before tax, as a percentage
of the Adjusted profit before tax.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Adjusted profit before tax 122,662 60,211 117,720
Taxation 16,226 9,407 21,736
Effective tax rate before tax on adjusting items 13.2% 15.6% 18.5%
Tax arising on bridging items to Adjusted profit before tax 11,382 3,733 4,267
Adjusted taxation 27,608 13,140 26,003
Adjusted effective tax rate 22.5% 21.8% 22.1%
Adjusted earnings per share
The Adjusted profit after tax comprises the Adjusted profit before tax, less
the Taxation expense as reported in the Consolidated statement of
comprehensive income, adjusted for the tax impact of the adjusting items in
arriving at Adjusted profit before tax.
The Adjusted earnings per share comprises the Adjusted profit after tax
divided by the either the basic or diluted weighted average number of equity
shares, as reported in note 8 of the 2023 Annual Report and Accounts and in
the interim financial information for the 6 months ended 30 June 2023.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Adjusted profit before tax 122,662 60,211 117,720
Taxation (16,226) (9,407) (21,736)
Tax arising on bridging items to Adjusted profit before tax (11,382) (3,733) (4,267)
Adjusted profit after tax 95,054 47,071 91,717
Weighted average number of equity shares Number Number Number
Basic 78,910,471 78,558,801 76,979,596
Diluted 79,995,267 81,552,510 80,481,897
Adjusted earnings per share $ c $ c $ c
Basic 120.46 59.92 119.14
Diluted 118.82 57.72 113.96
Return on capital employed (ROCE)
ROCE represents the Adjusted profit before tax (excluding net interest costs,
unwinding of discounted lease liabilities and bank charges, and also adjusted
to include pre-acquisition profits of current-year acquisitions), expressed as
a percentage of the capital employed. As the Group continues to make multiple
acquisitions each year, the calculation further adjusts the Adjusted profit
before tax and the capital employed as if all the acquisitions made during
each year were made at the start of that year.
Capital employed represents Total equity as reported on the Consolidated
statement of financial position, adding back employee defined benefit plan
liabilities, cumulative amortisation of intangible assets (customer
relationships), acquisition-related liabilities (deferred and contingent
consideration), together with loans and borrowings, while deducting cash and
cash equivalents.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Adjusted profit before tax 122,662 60,211 117,720
Interest received (666) (165) (326)
Bank charges 781 380 695
Interest expense 6,235 2,408 1,336
Unwinding of discounted liabilities - lease liabilities 1,562 680 1,005
Pre-acquisition profits of current year acquisitions 10,427 1,355 1,689
Adjusted profit before tax including pre-acquisition profit excluding interest 141,001 64,869 122,119
for the period
Rolling 12 month adjustment - 69,164 -
Adjusted profit before tax including pre-acquisition profit and excluding net 141,001 134,033 122,119
interest
Total equity 660,515 646,263 594,195
Employee defined benefit plans 4,448 3,913 3,052
Cumulative amortisation of intangible assets (customer relationships) 84,579 73,335 62,182
Deferred and contingent consideration 61,627 83,281 67,465
Loans and borrowings 140,618 59,997 55
Cash and cash equivalents (66,083) (47,632) (87,339)
Capital employed 885,704 819,157 639,610
Return on capital employed 15.9% 16.4% 19.1%
Free cash flow
Free cash flow represents Net cash generated by / (used in) operating
activities as reported in the Consolidated statement of cash flows, adjusted
for acquisition and integration cash outlay, capital expenditure, settlement
of deferred consideration related to continuous employment, net interest paid,
payments of principal on lease liabilities and is presented both before and
after taxation paid. In order to present the measure consistently
year-on-year, the impact of other income is also excluded.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Net cash generated by / (used in) operating activities 121,633 29,532 129,379
Acquisition and integration cash outlay:
Costs of acquisition and integration 29,424 7,876 8,673
Fair value adjustments to contingent consideration (334) - (2,369)
Non-cash movements in Deferred and contingent (9,611) (4,668) (3,240)
consideration related to continuous employment
Fair value adjustments to property, plant (6,231) - -
and equipment
Fair value adjustments to right of use assets (2,210) - -
Other fair value movements within Cost of acquisition and integration (2,899) - -
Acquisition of property, plant and equipment (33,204) (20,350) (28,211)
Investment in intangible assets (3,305) (1,428) (523)
Other income - - (1,220)
Settlement of deferred and contingent consideration related to continuous 4,222 - -
employment
Interest received 666 165 326
Interest paid (8,358) (2,567) (1,884)
Payments of principal on lease liabilities (16,476) (7,351) (11,788)
Free cash flow after tax 73,317 1,209 89,143
Taxation paid 22,645 8,575 18,285
Free cash flow before tax 95,962 9,784 107,428
Adjusted free cash flow
Adjusted free cash flow is a measure of cash flow adjusting for capital
expenditure that is supporting growth in future periods (as measured by
capital expenditure in excess of maintenance capital expenditure).
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Free cash flow before tax 95,962 9,784 107,428
Capital expenditure in excess of depreciation:
Acquisition of property, plant and equipment 33,204 20,350 28,211
Depreciation - property, plant and equipment (24,995) (11,769) (19,241)
Capital expenditure in excess of depreciation 8,209 8,581 8,970
Adjusted free cash flow 104,171 18,365 116,398
Adjusted cash conversion rate
The Adjusted cash conversion rate is the Adjusted free cash flow as a
percentage of the Adjusted profit before tax:
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Adjusted free cash flow 104,171 18,365 116,398
Adjusted profit before tax 122,662 60,211 117,720
Adjusted cash conversion ratio 84.9% 30.5% 98.9%
Net debt
The Group manages capital by monitoring debt to capital and net debt ratios.
Net debt is calculated as Loans and borrowings (as shown in the Consolidated
statement of financial position) less Cash and cash equivalents, and excludes
Lease liabilities.
Year End Half Year Year End
31 December 30 June 31 December
2023 2023 2022
Calculation $'000 $'000 $'000
Loans and borrowings 140,618 59,997 55
Cash and cash equivalents (66,083) (47,632) (87,339)
Net debt / (net cash) position 74,535 12,365 (87,284)
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