REG - Melrose Ind Plc - Audited Results For Year Ended 31 December 2014 <Origin Href="QuoteRef">MRON.L</Origin> - Part 3
04/03/2015 07:01
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14.7 21.7
Profit before tax 128.9 144.0
Tax 4 (41.8) (41.6)
Profit for the year from discontinued operations 5 107.6 462.2
Profit for the year 194.7 564.6
(1) Restated to include the results of Bridon within discontinued operations (note 5).
(2) As defined on the Income Statement.
(3) Long Term Incentive Plans.
Total assets Total liabilities
31 December Restated(1)31 December 31 December Restated(1)31 December
2014£m 2013£m 2014£m 2013£m
Continuing operations
Energy 502.5 497.7 136.3 146.5
Gas 2,054.8 2,038.7 506.1 470.3
Electricity 337.1 343.0 107.8 117.7
Water 183.7 201.6 84.1 92.6
Elster central 5.3 6.3 52.8 60.5
Elster total 2,580.9 2,589.6 750.8 741.1
Central - corporate 104.9 249.4 700.9 488.7
Central - LTIPs(2) - - 26.6 21.6
Total continuing operations 3,188.3 3,336.7 1,614.6 1,397.9
Discontinued operations - 340.6 - 91.5
Total 3,188.3 3,677.3 1,614.6 1,489.4
(1) Restated to include the total assets and total liabilities of Bridon within discontinued operations (note 5).
(2) Long Term Incentive Plans.
Capital expenditure(1) Depreciation(1)
Year ended Restated(2)year ended Year ended Restated(2)year ended
31 December 31 December 31 December 31 December
2014£m 2013£m 2014£m 2013£m
Continuing operations
Energy 30.1 16.8 6.3 5.9
Gas 16.9 14.1 15.4 15.4
Electricity 11.1 6.9 5.8 6.7
Water 3.9 3.7 3.3 4.5
Elster central - 0.3 0.1 -
Elster total 31.9 25.0 24.6 26.6
Central - corporate 0.2 0.6 0.9 0.7
Total continuing operations 62.2 42.4 31.8 33.2
Discontinued operations 4.1 18.9 6.8 15.2
Total 66.3 61.3 38.6 48.4
(1) Including computer software and development costs.
(2) Restated to include the capital expenditure(1) and depreciation(1) of Bridon within discontinued operations (note 5).
Geographical information
The Group operates in various geographical areas around the world. The Group's country of domicile is the UK and the
Group's revenues and non-current assets in Europe and North America are also considered to be material.
The Group's revenue from external customers and information about its segment assets (non-current assets excluding
interests in joint ventures, deferred tax assets, derivative financial assets and non-current trade and other receivables)
by geographical location are detailed below:
Revenue(1) from external customers Non-current assets
Year ended Restated(2)year ended 31 December Restated(2)
31 December 31 December 2014£m 31 December
2014£m 2013£m 2013£m
Continuing operations
UK 159.2 189.9 239.7 276.9
Europe 507.9 509.8 1,399.8 1,522.4
North America 408.4 461.7 859.1 706.7
Other 302.0 305.0 106.3 109.8
Total continuing operations 1,377.5 1,466.4 2,604.9 2,615.8
Discontinued operations 208.0 659.2 - 237.4
Total 1,585.5 2,125.6 2,604.9 2,853.2
(1) Revenue is presented by destination.
(2) Restated to include the revenue and non-current assets of Bridon within discontinued operations (note 5).
3. Exceptional costs and income
Exceptional costs Year ended31 December 2014£m Year ended31 December 2013£m
Continuing operations
Restructuring costs (30.6) (18.8)
Acquisition and disposal costs (3.7) (0.5)
Total exceptional costs (34.3) (19.3)
During 2014, the continuing Group incurred £30.6 million (2013: £18.8 million) of costs relating to restructuring
programmes which are expected to deliver cost savings in the future.
The costs in both years were weighted towards the recently acquired Elster businesses, notably towards Gas in 2014. The
most significant proportion of restructuring within the Gas business relates to the major closure of the Essen plant in
Belgium and relocation of its Integrated Metering Solutions business, which builds metering stations, to Saudi Arabia and
Malaysia. In addition, as a consequence of the closure of Essen, research and development and the production of ultrasonic
meters was moved to Mainz, Germany in the year. Initial restructuring costs following the acquisition of Eclipse were also
incurred in 2014.
The restructuring costs incurred in 2013 were proportionally weighted to the Elster Electricity and Water businesses and
whilst restructuring costs have been incurred within these businesses in 2014 they are focused on European operations
rather than the large restructures in the North America businesses incurred in previous years.
The Group also incurred £3.7 million (2013: £0.5 million) of expenses on acquisition and disposal related activities during
the year.
Exceptional income Year ended Year ended31 December 2013£m
31 December
2014
£m
Continuing operations
Release of surplus leasehold property cost provision 5.4 -
Release of items previously booked as fair value adjustments - 28.9
Total exceptional income 5.4 28.9
During the year a historical onerous lease dispute was successfully resolved for less than expected resulting in the
release of £5.4 million from provisions as exceptional income.
During 2013 certain warranty and legal issues, inherited with the acquisition of Elster, were successfully resolved for
less than expected resulting in the release of £28.9 million of provisions as exceptional income.
4. Tax
Continuing operations Discontinued operations Total
Analysis of charge/(credit) in year: Year ended Restated(1)year ended Year ended Restated(1)year ended Year ended Year ended
31 December 31 December 31 December 31 December 31 December 31 December
2014 2013 2014 2013 2014 2013
£m £m £m £m £m £m
Current tax 46.2 33.9 4.6 43.1 50.8 77.0
Deferred tax (4.4) 7.7 (1.2) (5.1) (5.6) 2.6
Total income tax charge 41.8 41.6 3.4 38.0 45.2 79.6
Tax charge on headline(2) profit before tax 57.4 50.5 5.5 42.0 62.9 92.5
Exceptional tax charge 3.9 8.1 - - 3.9 8.1
Tax (credit)/charge on net exceptional items (3.6) 3.7 (0.5) - (4.1) 3.7
Tax credit in respect of intangible asset amortisation (15.9) (20.7) (1.6) (4.0) (17.5) (24.7)
Total income tax charge 41.8 41.6 3.4 38.0 45.2 79.6
(1) Restated to include the results of Bridon within discontinued operations (note 5).
(2) As defined on the Income Statement.
The tax charge for the year ended 31 December 2014 includes an exceptional tax charge of £3.9 million (2013: £8.1 million)
predominantly relating to the tax costs arising on an internal reorganisation of the Electricity business (2013: internal
reorganisation of the Water business).
The charge for the year can be reconciled to the profit per the Income Statement as follows:
Year ended Restated(1)year ended
31 December 31 December
2014£m 2013£m
Profit on ordinary activities before tax:
Continuing operations 128.9 144.0
Discontinued operations (note 5) 14.1 99.5
143.0 243.5
Tax on profit on ordinary activities at weighted average rate 28.49% (2013: 29.89%) 40.7 72.8
Tax effect of:
Net permanent differences/non-deductible items 1.3 5.8
Effect of rate change on deferred tax liabilities on intangible assets - (3.9)
Temporary differences not recognised in deferred tax 3.7 (2.2)
Tax credits, withholding taxes and other rate differences (1.5) 1.4
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