REG - Oxford Instruments - Final Results <Origin Href="QuoteRef">OXIG.L</Origin> - Part 2
15/06/2016 07:10
- Part 2: For the preceding part double click ID:nRSO2025Ba
16.1
From discontinued operations (0.5) (3.9)
From profit for the year 48.7 12.2
Diluted earnings per share 2
From continuing operations 49.1 16.1
From discontinued operations (0.5) (3.8)
From profit for the year 48.6 12.3
Dividends per share
Dividends paid 9 13.0
Dividends proposed 9 13.0
* Adjusted numbers are stated to give a better understanding of the
underlying business performance. Details of adjusting items can be found in
Note 1 of this Preliminary Statement.
The attached notes form part of the Financial Statements.
Consolidated Statement of Income
year ended 31 March 2015
Notes Adjusted*£m Adjustingitems*£m Total £m
Revenue 3 380.1 - 380.1
Cost of sales (210.3) (0.2) (210.5)
Gross profit 169.8 (0.2) 169.6
Research and development 4 (30.5) - (30.5)
Selling and marketing (64.9) - (64.9)
Administration and shared services (34.3) (40.6) (74.9)
Share of loss of associate, net of tax 6 - - -
Other operating income - 1.4 1.4
Foreign exchange 2.7 - 2.7
Operating profit/(loss) 42.8 (39.4) 3.4
Other financial income 0.1 - 0.1
Financial income 0.1 - 0.1
Interest charge on pension scheme net liabilities (1.9) - (1.9)
Other financial expenditure (5.3) (5.9) (11.2)
Financial expenditure (7.2) (5.9) (13.1)
Profit/(loss) before income tax 35.7 (45.3) (9.6)
Income tax (expense)/credit 8 (8.1) 11.5 3.4
Profit/(loss) for the year from continuing operations 27.6 (33.8) (6.2)
Loss from discontinued operations after tax 7 (0.1) - (0.1)
Profit/(loss) for the year attributable to equity Shareholders of the parent 27.5 (33.8) (6.3)
pence pence
Earnings per share
Basic earnings per share 2
From continuing operations 48.4 (10.9)
From discontinued operations (0.2) (0.2)
From profit/(loss) for the year 48.2 (11.1)
Diluted earnings per share 2
From continuing operations
From discontinued operations 48.2 (10.9)
From profit/(loss) for the year (0.2) (0.2)
48.0 (11.1)
Dividends per share
Dividends paid 9 12.4
Dividends proposed 9 13.0
* Adjusted numbers are stated to give a better understanding of the
underlying business performance. Details of adjusting items can be found in
Note 1 of this Preliminary Statement.
Consolidated Statement of Comprehensive Income
year ended 31 March 2016
Notes 2016£m 2015 £m
Profit/(loss) for the year 7.0 (6.3)
Other comprehensive income/(expense):
Items that may be reclassified subsequently to profit or loss
(Loss)/ gain on effective portion of changes in fair value of cash flow hedges, net of amounts recycled (0.1) 0.1
Foreign exchange translation differences 5.6 7.3
Net foreign exchange loss on disposal of subsidiaries taken to the income statement 1.2 -
Tax on items that may be reclassified to profit or loss - -
Items that will not be reclassified subsequently to profit or loss
Remeasurement gain/(loss) in respect of post-retirement benefits 13.6 (10.8)
Tax on items that will not be reclassified to profit or loss 8 (2.6) 2.3
Total other comprehensive income/(expense) 17.7 (1.1)
Total comprehensive income/(expense) for the year attributable to equity Shareholders of the parent 24.7 (7.4)
Consolidated Statement of Financial Position
as at 31 March 2016
2016£m 2015 £m
Assets
Non-current assets
Property, plant and equipment 35.2 33.1
Intangible assets 220.8 231.3
Investment in associate 13.1 -
Long-term receivables 3.4 -
Deferred tax assets 19.0 20.1
291.5 284.5
Current assets
Inventories 61.1 70.8
Trade and other receivables 77.5 87.3
Current income tax recoverable 2.7 3.3
Derivative financial instruments 1.5 3.4
Cash and cash equivalents 21.8 25.1
164.6 189.9
Total assets 456.1 474.4
Equity
Capital and reserves attributable to the Company's equity Shareholders
Share capital 2.9 2.9
Share premium 61.5 61.5
Other reserves 0.1 0.2
Translation reserve 9.7 2.9
Retained earnings 68.8 58.0
143.0 125.5
Liabilities
Non-current liabilities
Bank loans and overdrafts 147.0 144.0
Other payables - 0.8
Retirement benefit obligations 35.0 53.5
Deferred tax liabilities 5.7 6.2
187.7 204.5
Current liabilities
Bank loans and overdrafts 3.0 -
Trade and other payables 102.4 121.6
Current income tax payables 2.1 2.6
Derivative financial instruments 5.8 4.1
Provisions 12.1 16.1
125.4 144.4
Total liabilities 313.1 348.9
Total liabilities and equity 456.1 474.4
The Financial Statements were approved by the Board of Directors on 15 June
2016 and signed on its behalf by:
Ian Barkshire Gavin Hill
Director Director
Company Number: 775598
Consolidated Statement of Changes in Equity
year ended 31 March 2016
Sharecapital£m Sharepremiumaccount£m Otherreserves£m Foreignexchangetranslationreserve£m Retainedearnings£m Total£m
Balance at 1 April 2015 2.9 61.5 0.2 2.9 58.0 125.5
Total comprehensive income:
Profit for the year - - - - 7.0 7.0
Other comprehensive income:
- Foreign exchange translation differences - - - 5.6 - 5.6
- Net foreign exchange loss on disposal of subsidiaries taken to the income statement - - - 1.2 - 1.2
- Loss on effective portion of changes in fair value of cash flow hedges, net of amounts recycled - - (0.1) - - (0.1)
- Remeasurement gain in respect of post-retirement benefits - - - - 13.6 13.6
- Tax on items recognised directly in other comprehensive income - - - - (2.6) (2.6)
Total comprehensive income/(expense) attributable to equity Shareholders of the parent - - (0.1) 6.8 18.0 24.7
Transactions with owners recorded directly in equity:
- Charge in respect of employee service costs settled by award of share options - - - - 0.4 0.4
- Dividends paid - - - - (7.6) (7.6)
Total transactions with owners recorded directly in equity - - - - (7.2) (7.2)
Balance at 31 March 2016 2.9 61.5 0.1 9.7 68.8 143.0
Other reserves comprise the capital redemption reserve, which represents the
nominal value of shares repurchased and then cancelled during the year ended
31 March 1999, and the hedging reserve in respect of the effective portion of
changes in value of commodity contracts.
The foreign exchange translation reserve comprises all foreign exchange
differences arising since 1 April 2004 from the translation of the Group's net
investments in foreign subsidiaries into Sterling.
The Group holds 183,145 (2015: 183,145) of its own shares in an employee
benefit trust. The cost of these shares is included within retained earnings.
There was no movement in the shares held by the trust during the year.
Consolidated Statement of Changes in Equity
year ended 31 March 2016
Sharecapital£m Sharepremiumaccount£m Otherreserves£m Foreignexchangetranslationreserve£m Retainedearnings£m Total£m
Balance at 1 April 2014 2.9 61.3 0.1 (4.4) 80.3 140.2
Total comprehensive income:
Loss for the year - - - - (6.3) (6.3)
Other comprehensive income:
- Foreign exchange translation differences - - - 7.3 - 7.3
- Gain on effective portion of changes in fair value of cash flow hedges, net of amounts recycled - - 0.1 - - 0.1
- Remeasurement loss in respect of post-retirement benefits - - - - (10.8) (10.8)
- Tax on items recognised directly in other comprehensive income - - - - 2.3 2.3
Total comprehensive income/(expense) attributable to equity Shareholders of the parent - - 0.1 7.3 (14.8) (7.4)
Transactions with owners recorded directly in equity:
- Credit in respect of employee service costs settled by award of share options - - - - (0.2) (0.2)
- Tax charge in respect of share options - - - - (0.2) (0.2)
- Proceeds from shares issued - 0.2 - - - 0.2
- Dividends paid - - - - (7.1) (7.1)
Total transactions with owners recorded directly in equity - 0.2 - - (7.5) (7.3)
Balance at 31 March 2015 2.9 61.5 0.2 2.9 58.0 125.5
Consolidated Statement of Cash Flows
year ended 31 March 2016
2016£m 2015£m
Profit/(loss) for the year from continuing operations 9.2 (6.2)
Adjustments for:
Income tax expense 3.9 (3.4)
Net financial expense 11.1 13.0
Acquisition related fair value adjustments to inventory 0.2 0.2
Acquisition related fair value adjustments to property, plant and equipment 0.8 -
Acquisition related costs 2.5 2.2
Restructuring costs 2.9 9.9
Restructuring costs - relating to associate 1.3 -
Loss on disposal of subsidiary 0.9 -
Contingent consideration - further amount deemed payable - 6.8
Contingent consideration deemed no longer payable (4.9) (1.4)
Share of loss from associate 0.2 -
Amortisation and impairment of acquired intangibles 16.7 21.7
Depreciation of property, plant and equipment 6.3 5.5
Amortisation and impairment of capitalised development costs 3.9 4.7
Adjusted earnings before interest, tax, depreciation and amortisation 55.0 53.0
Loss on disposal of property, plant and equipment 0.1 0.2
Cost of equity settled employee share schemes 0.4 (0.2)
Acquisition related costs paid (1.8) (1.9)
Restructuring costs paid (4.7) (1.2)
Cash payments to the pension scheme more than the charge to operating profit (6.7) (5.9)
Operating cash flows before movements in working capital 42.3 44.0
Decrease/(increase) in inventories 2.7 (3.3)
Decrease/(increase) in receivables 9.3 (5.3)
Increase in payables and provisions (1.2) 1.6
Increase in customer deposits (0.5) 1.9
Purchase of rental assets held for subsequent sale (3.0) -
Cash generated from operations 49.6 38.9
Interest paid (5.6) (5.0)
Income taxes paid (3.5) (9.1)
Net cash from operating activities 40.5 24.8
Cash flows from investing activities
Acquisition of subsidiaries, net of cash acquired (27.1) (0.8)
Acquisition of property, plant and equipment (2.5) (4.4)
Acquisition of intangible assets (0.2) (1.0)
Proceeds from sale of subsidiary undertaking 0.6 -
Capitalised development expenditure (8.2) (8.0)
Net cash used in investing activities (37.4) (14.2)
Cash flows from financing activities
Proceeds from issue of share capital - 0.2
Increase in long-term receivables (3.0) -
Increase/(decrease) in borrowings 4.6 (12.9)
Dividends paid (7.6) (7.1)
Net cash from financing activities (6.0) (19.8)
Net decrease in cash and cash equivalents from continuing operations (2.9) (9.2)
Decrease in cash from discontinued operations (0.9) (0.1)
Cash and cash equivalents at beginning of the year 25.1 32.6
Effect of exchange rate fluctuations on cash held (0.9) 1.8
Cash and cash equivalents at end of the year 20.4 25.1
Reconciliation of changes in cash and cash equivalents to movement in net debt
Decrease in cash and cash equivalents (3.8) (9.3)
Effect of foreign exchange rate changes on cash and cash equivalents (0.9) 1.8
(4.7) (7.5)
Cash (inflow)/outflow from increase/decrease in debt (4.6) 12.9
Movement in net debt in the year (9.3) 5.4
Net debt at start of the year (118.9) (124.3)
Net debt at the end of the year (128.2) (118.9)
Notes to the Financial Statements
year ended 31 March 2016
1 Non-GAAP measures
The Directors present the following non-GAAP measures as they consider that
they give a better indication of the underlying performance of the business.
Reconciliation between profit before income tax and adjusted profit from
continuing operations
2016£m 2015£m
Profit/(loss) before income tax from continuing operations 13.1 (9.6)
Reversal of acquisition related fair value adjustments to inventory 0.2 0.2
Reversal of acquisition related fair value adjustments to property, plant and equipment 0.8 -
Acquisition related costs 2.5 2.2
Restructuring costs 2.9 9.9
Restructuring costs - relating to associate 1.3 -
Loss on disposal of subsidiary 0.9 -
Contingent consideration - further amount deemed payable - 6.8
Contingent consideration deemed no longer payable (4.9) (1.4)
Unwind of discount in respect of contingent consideration and acquisition related accruals 0.8 1.1
Non-recurring and acquisition related items 4.5 18.8
Amortisation and impairment of acquired intangibles 16.7 21.7
Mark to market loss in respect of derivative financial instruments 2.7 4.8
Adjusted profit before income tax from continuing operations 37.0 35.7
Share of taxation (8.9) (8.1)
Adjusted profit for the year from continuing operations 28.1 27.6
The reversal of acquisition related fair value adjustments to inventory and
property, plant and equipment are excluded from adjusted profit to provide a
measure that includes results from acquired businesses on a consistent basis
over time to assist comparison of performance.
Acquisition related costs comprise professional fees incurred in relation to
mergers and acquisitions activity and any consideration which, under IFRS 3
(revised), falls to be treated as a post acquisition employment expense.
Restructuring costs comprise one-off costs in respect of the ongoing cost
reduction programme begun in the prior year, including an impairment of
inventory and capitalised development costs in the Plasma Technology business
in relation to the exit from the HBLED market. Restructuring costs relating to
the Group's associate relate to exceptional costs incurred by the associate
arising from the merger of the Scienta and Omicron businesses.
In common with a number of other companies adjusted profit excludes the
non-cash amortisation and impairment of acquired intangible assets and
goodwill and the unwind of discounts in respect of contingent consideration
relating to business combinations.
In the prior year, a further £6.8m was provided in respect of additional
contingent consideration expected to be due in respect of the acquisition of
Platinum Medical Imaging in November 2011.
In the current year, £4.9m has been released relating to contingent
consideration on the acquisition of Asylum Research Corporation following the
end of the earnout period. In the prior year, £1.4m was released in respect of
contingent consideration relating to the acquisition of RMG Technology
Limited.
The group made a loss on disposal of its Omicron business of £0.9m in the
current year. Further details of the transaction can be found in Note 6 .
Under IAS 39, all derivative financial instruments are recognised initially at
fair value. Subsequent to initial recognition, they are also measured at fair
value. In respect of instruments used to hedge foreign exchange risk and
interest rate risk the Group does not take advantage of the hedge accounting
rules provided for in IAS 39 since that standard requires certain stringent
criteria to be met in order to hedge account, which, in the particular
circumstances of the Group, are considered by the Board not to bring any
significant economic benefit. Accordingly, the Group accounts for these
derivative financial instruments at fair value through profit or loss. To the
extent that instruments are hedges of future transactions, adjusted profit for
the year is stated before changes in the valuation of these instruments so
that the underlying performance of the Group can be more clearly seen.
In calculating the share of tax attributable to adjusted profit before tax in
2011 a one-off recognition of deferred tax assets relating to the Group's UK
businesses of £11.3m was excluded. At that time the Group announced its
intention to exclude the reversal of this deferred tax from the calculation of
the share of tax attributable to adjusted profit before tax in the years in
which it reverses. In the current and prior period tax losses arose in the UK
and consequently no deferred tax reversed.
See Note 7 for details of adjusting items from discontinued operations.
2 Earnings per share
The calculation of basic and adjusted earnings per share is based on the
profit for the year as shown in the Consolidated Statement of Income and the
adjusted profit for the year as shown in Note 1 respectively. Basic and
adjusted earnings are divided by the weighted average number of ordinary
shares outstanding during the year, excluding shares held by the Employee
Share Ownership Trust.
2016£m 2015£m
Basic earnings 7.0 (6.3)
Adjusted earnings (Note 1 ) 27.8 27.5
Weighted average number of shares 57.1 57.1
pence pence
Basic earnings per share from continuing operations 16.1 (11.1)
Adjusted earnings per share from continuing operations 49.2 48.2
The weighted average number of shares used in the calculation excludes shares
held by the Employee Share Ownership Trust, as follows:
2016Sharesmillion 2015Sharesmillion
Weighted average number of shares outstanding 57.3 57.3
Less shares held by Employee Share Ownership Trust (0.2) (0.2)
Weighted average number of shares used in calculation of basic earnings per share 57.1 57.1
The following table shows the effect of share options on the calculation of
diluted earnings per share:
2016Sharesmillion 2015Sharesmillion
Weighted average number of ordinary shares per basic earnings per share calculations 57.1 57.1
Effect of shares under option 0.1 0.2
Weighted average number of ordinary shares per diluted earnings per share calculations 57.2 57.3
In the prior year the Group reported a loss, and as such basic earnings per
share was equal to reported diluted earnings per share. This is due to the
fact that the shares under option above would have an anti-dilutive effect.
Adjusted diluted earnings per share has been calculated in a manner consistent
with previous periods.
3 Segment information
The Group has eight operating segments. These operating segments have been
combined into three aggregated operating segments to the extent that they have
similar economic characteristics, with relevance to products and services,
type and class of customer, methods of sale and distribution and the
regulatory environment in which they operate. Each of these three aggregated
operating segments is a reportable segment.
The Group's internal management structure and financial reporting systems
differentiate the three aggregated operating segments on the basis of the
economic characteristics discussed below:
· the Nanotechnology Tools segment contains a group of businesses,
supplying similar products, characterised by a high degree of customisation
and high unit prices. These are the Group's highest technology products
serving research customers in both the public and private sectors;
· the Industrial Products segment contains a group of businesses
supplying high technology products and components manufactured in medium
volume for industrial customers; and
· the Service segment contains the Group's service, rental and
refurbished asset sales business as well as service revenues from other parts
of the Group.
Reportable segment results include items directly attributable to a segment as
well as those which can be allocated on a reasonable basis. Inter-segment
pricing is determined on an arm's length basis. The operating results of each
are regularly reviewed by the Chief Operating Decision Maker, which is deemed
to be the Board of Directors. Discrete financial information is available for
each segment and used by the Board of Directors for decisions on resource
allocation and to assess performance. No asset information is presented below
as this information is not presented in reporting to the Group's Board of
Directors.
a) Analysis by business
Year to 31 March 2016 NanotechnologyTools£m IndustrialProducts£m Service£m Total£m
External revenue 187.3 95.9 78.4 361.6
Inter-segment revenue 0.1 0.7 -
Total segment revenue 187.4 96.6 78.4
Segment adjusted operating profit from continuing operations 21.3 4.5 18.8 44.6
Year to 31 March 2015 NanotechnologyTools£m IndustrialProducts£m Service£m Total£m
External revenue 210.9 103.0 66.2 380.1
Inter-segment revenue 0.3 1.1 -
Total segment revenue 211.2 104.1 66.2
Segment adjusted operating profit from continuing operations 20.7 6.4 15.7 42.8
The loss after tax of £0.2m from the Group's associate is reported within the
Nanotechnology Tools segment.
Included in the Service sector is revenue from equipment sales of £13.8m
(2015: £7.7m) and from equipment leasing of £8.1m (2015: £0.3m) . These two
business lines contributed £1.7 m (2015 £0.7m) and £1.5m (2015: £0.2m)
respectively to the Group's operating profit.
Reconciliation of reportable segment profit
2016£m 2015£m
Adjusted profit for reportable segments from continuing operations 44.6 42.8
Reversal of acquisition related fair value adjustments to inventory (0.2) (0.2)
Reversal of acquisition related fair value adjustments to property, plant and equipment (0.8) -
Acquisition related costs (2.5) (2.2)
Restructuring costs (2.9) (9.9)
Restructuring costs - relating to associate (1.3) -
Loss on disposal of subsidiary (0.9) -
Contingent consideration - further amount deemed payable - (6.8)
Contingent consideration deemed no longer payable 4.9 1.4
Amortisation and impairment of acquired intangibles (16.7) (21.7)
Financial income - 0.1
Financial expenditure (11.1) (13.1)
Profit/(loss) before income tax on continuing operations 13.1 (9.6)
4 Research and development (R&D)
The total R&D spend by the Group is as follows:
2016 2015
NanotechnologyTools£m IndustrialProducts£m Total£m NanotechnologyTools£m IndustrialProducts£m Total£m
R&D expense charged to the Consolidated Statement of Income 17.6 7.0 24.6 22.5 8.0 30.5
Less: depreciation of R&D related fixed assets - (0.8) (0.8) (0.2) (0.6) (0.8)
Add: amounts capitalised as fixed assets 0.1 1.1 1.2 0.9 1.3 2.2
Less: amortisation of R&D costs previously capitalised as intangibles (2.8) (1.1) (3.9) (3.2) (1.5) (4.7)
Add: amounts capitalised as intangible assets 5.8 2.4 8.2 6.1 1.9 8.0
Total cash spent on R&D during the year 20.7 8.6 29.3 26.1 9.1 35.2
In the current year an additional £0.6m (2015: £0.7m) impairment of
capitalised development was included within administration and shared services
in the Consolidated Statement of Income relating to the refocusing of the
Plasma Technology business.
5 Acquisitions
Medical Imaging Resources, Inc.
On 1 May 2015 the Group acquired 100% of the issued share capital of Medical
Imaging Resources, Inc. (MIR) for a net cash consideration of £8.7m. MIR
specialises in the build, lease, service and sale of mobile medical imaging
labs.
The book and fair values of the assets and liabilities acquired are given in
the table below. Fair value adjustments have been made to better align the
accounting policies of the acquired business with the Group accounting
policies and to reflect the fair value of assets and liabilities acquired. The
business has been acquired for the purpose of integrating into the Oxford
Instruments Healthcare business where it is believed that a number of
synergies can be obtained.
Book value£m Adjustments£m Fair value£m
Intangible fixed assets - 5.7 5.7
Tangible fixed assets 3.8 0.5 4.3
Inventories 1.4 0.1 1.5
Trade and other receivables 0.9 - 0.9
Trade and other payables (1.7) - (1.7)
Deferred tax 0.2 (0.4) (0.2)
Net debt (2.6) - (2.6)
Net assets acquired 2.0 5.9 7.9
Goodwill 4.5
Total consideration 12.4
Net debt acquired 2.6
Contingent consideration at acquisition (6.3)
Net cash outflow relating to the acquisition 8.7
The goodwill arising is not tax deductible and is considered to represent the
value of the acquired workforce and synergistic benefits expected to arise
from the acquisition.No deferred tax liability has been recognised relating to
the fair value of acquired intangibles due to the company making a 3338
election in the United States of America to treat this acquisition as a trade
and assets purchase for tax purposes. Further contingent consideration of up
to £6.7m is payable based on the performance of the Oxford Instruments
Healthcare business in the year to 31 March 2016.
The book value of receivables in the tables above represents the gross
contractual amounts receivable.
The acquisition above contributed revenue of £16.0m and a reported operating
profit of £6.3m to the Group's result for the period. Had the acquisition
taken place on 1 April 2015 the equivalent Group numbers would have been
revenue of £363.1m and a reported operating profit of £45.2m.
Cash outflow from the acquisition of subsidiaries (net of cash acquired)
includes £18.4m of deferred consideration paid for the acquisition of Platinum
Medical Imaging and Asylum Research Corporation in 2011 and 2012
respectively.
6 Investment in associate
On 27 May 2015 the Group entered into a strategic alliance with GD
Intressenter AB of Sweden (GDI) to create the world's largest company in the
highly specialised Ultra High Vacuum Surface Science field. The alliance
comprises Oxford Instruments' Omicron Nanotechnology GmbH ("Omicron") and
associated subsidiaries and GDI's Scienta Scientific AB ("Scienta") and
associated subsidiaries. Scienta Scientific AB is registered and has its
principal place of business in Sweden.
In consideration for new shares in Scienta, Oxford Instruments transferred all
of its shares in the capital of Omicron to Scienta. Oxford Instruments holds a
47% interest in the ordinary share capital of Scienta and GDI holds 53%. The
investment has been accounted for as an associate taking into account the
following factors:
- The Group holds substantial, but minority, voting rights (47%). All
other rights are controlled by a single shareholder;
- The Group has a minority number of non-executive board seats (two of
five), with the remaining seats held by representatives of GDI;
- Whilst the Group has certain veto rights in respect of key decisions,
it cannot unilaterally direct the activities of the Scienta Group.
The book value of the net assets disposed of was £14.9m. The value of the
shareholding acquired in Scienta was considered to be £14.6m and as a result a
£0.3m loss on disposal arose on the transaction. In addition, a further £0.6m
has been provided in respect of certain liabilities arising from the
transaction.
The Group's share of loss in its equity accounted associate for the year was
£1.5m. The Group did not receive any dividends from the associate.
£m
Carrying value at 1 April 2015 -
Addition 14.6
Share of loss of associate (net of tax) (1.5)
Dividends received -
Carrying value at 31 March 2016 13.1
Summary financial information for the equity accounted associate is as
follows:
2016
£m
Non-current assets 3.2
Current assets 27.0
Total assets 30.2
Current liabilities (21.4)
Non-current liabilities (4.0)
Total liabilities (25.4)
Net assets 4.8
Income 34.0
Expenses (37.2)
Loss for the year (3.2)
Group's share of net assets 2.3
Group's share of loss (1.5)
According to the terms of the transaction, no dividend can be paid by the
associate until 27 May 2017. Following that date, any dividend paid must be
agreed by both Oxford Instruments plc and GD Intressenter AB, up to a maximum
of 50% of the previous year's profit after tax.
7 Disposal of subsidiary and discontinued operations
On 23 November 2015 the Group disposed of its Austin Scientific business for a
final consideration of £0.6m.
Effect of disposal on the financial position of the Group 2016
£m
Other intangible assets (1.7)
Property, plant and equipment (0.2)
Inventory (1.4)
Trade and other receivables (0.5)
Trade and other payables 0.3
Net assets divested (3.5)
Consideration received, satisfied in cash 0.6
Cash disposed of -
Transaction expenses (0.1)
Net cash inflow 0.5
Carrying value of net assets disposed of (3.5)
Impairment of net assets to fair value less costs to sell 2.8
Currency translation differences transferred from translation reserve 0.7
Gain on disposal before impairment 0.5
Less impairment loss (2.8)
Loss on disposal (2.3)
Tax on loss on disposal 0.4
Loss on disposal net of tax (1.9)
Discontinued operations
At 31 March 2016 the Group's Austin Scientific business was classified as a
discontinued operation. It was considered a major class of business on the
basis that it was previously an operating segment referred to in the Group
Strategic Report.
Results of discontinued operations 2016 2015
£m £m
Revenue 2.3 5.5
Expenses (2.8) (5.6)
Adjusted loss from operating activities before income tax (0.5) (0.1)
Income tax credit 0.2 -
Adjusted loss from operating activities after tax (0.3) (0.1)
Loss on disposal (2.3) -
Tax on loss on disposal 0.4 -
Loss from discontinued operations after tax (2.2) (0.1)
Earnings per share from discontinued operations 2016 2015
Adjusted basic loss per share (pence) (0.5) (0.2)
Adjusted diluted loss per share (pence) (0.5) (0.2)
Total basic loss per share (pence) (3.9) (0.2)
Total diluted loss per share (pence) (3.8) (0.2)
Cash flows from discontinued operations 2016 2015
£m £m
Net cash used in operating activities (0.9) (0.1)
Net cash from investing activities - -
Net cash from financing activities - -
Net cash flows (0.9) (0.1)
8 Income tax expense
Recognised in the Consolidated Statement of Income
2016£m 2015£m
Current tax expense
Current year 4.8 6.5
Adjustment in respect of prior years (0.2) (0.3)
4.6 6.2
Deferred tax expense
Origination and reversal of temporary differences (1.3) (9.0)
Recognition of deferred tax not previously recognised - -
Adjustment in respect of prior years 0.6 (0.6)
(0.7) (9.6)
Total tax expense/(credit) 3.9 (3.4)
Reconciliation of effective tax rate
Profit/(loss) before income tax 13.1 (9.6)
Income tax using the UK corporation tax rate of 20% (2015: 21%) 2.6 (2.0)
Effect of:
Tax rates other than the UK standard rate 2.2 1.2
Change in rate at which deferred tax recognised (0.4) -
Loss on disposal of held for sale assets 0.3 -
Non-taxable income and expenses (0.4) (1.5)
Tax incentives not recognised in the Consolidated Statement of Income (0.8) -
Recognition of deferred tax not previously recognised (0.1) -
Movement in unrecognised deferred tax 0.3 (0.2)
Adjustment in respect of prior years 0.2 (0.9)
Total tax expense/(credit) 3.9 (3.4)
Taxation charge/(credit) recognised in other comprehensive income
Deferred tax - relating to employee benefits 2.6 (2.3)
2.6 (2.3)
Taxation charge/(credit) recognised directly in equity
Deferred tax - relating to share options - 0.2
Reductions in the UK corporation tax rate from 23% to 21% (effective from 1
April 2014) and 20% (effective from 1 April 2015) were substantively enacted
on 2 July 2013. Further reductions to 19% (effective from 1 April 2017) and
to 18% (effective 1 April 2020) were substantively enacted on 26 October 2015.
The UK deferred tax balances at 31 March 2016 have been calculated based on
these rates which were substantively enacted at the balance sheet date. The
Group carries tax provisions in relation to uncertain tax provisions arising
from the possible outcome of negotiations with tax authorities. Such
provisions are a reflection of the geographical spread of the Group's
operations and the variety of jurisdictions in which it carries out its
activities.
9 Dividends per share
The following dividends per share were paid by the Group:
2016pence 2015pence
Previous year interim dividend 3.70 3.36
Previous year final dividend 9.30 9.04
13.00 12.40
The following dividends per share were proposed by the Group in respect of
each accounting year presented:
2016pence 2015pence
Interim dividend 3.70 3.70
Final dividend 9.30 9.30
13.00 13.00
The interim dividend was not provided for at the year end and was paid on 8
April 2016. The final proposed dividend of 13.0 pence per share (2015: 9.3
pence) was not provided at the year end and will be paid on 20 October 2016
subject to authorisation by the Shareholders at the forthcoming Annual General
Meeting.
10 Basis of preparation
This preliminary announcement does not constitute the company's statutory
accounts for the years ended 31 March 2016 or 2015. Statutory accounts for
2015 have been delivered to the registrar of companies, and those for 2016
will be delivered in due course. The auditor has reported on those accounts;
their reports were (i) unqualified, (ii) did not include a reference to any
matters to which the auditor drew attention by way of emphasis without
qualifying their report and (iii) did not contain a statement under section
498 (2) or (3) of the Companies Act 2006.
The financial information presented in this preliminary announcement for the
year ended 31 March 2016 is based on, and is consistent with, that in the
Group's audited Financial Statements for the year ended 31 March 2016. No
revisions to adopted IFRS that became applicable in 2016 had a significant
impact on the Group's Financial Statements for the year ended 31 March 2016.
The Company is registered in England, Registration Number 775598.
The principal exchange rates to Sterling used were:
Year end rates 2016 2015
US Dollar 1.44 1.48
Euro 1.26 1.38
Yen 162 178
Average translation rates 2016 US Dollar Euro Yen
April 2015 1.50 1.37 180
May 1.52 1.37 186
June 1.55 1.40 192
July 1.57 1.41 194
August 1.55 1.39 190
September 1.53 1.36 184
October 1.53 1.38 184
November 1.53 1.41 186
December 1.49 1.39 181
January 2016 1.45 1.33 175
February 1.40 1.29 165
March 1.41 1.27 160
Average translation rates 2015 US Dollar Euro Yen
April 2014 1.68 1.21 172
May 1.68 1.22 172
June 1.69 1.24 172
July 1.69 1.25 173
August 1.67 1.26 173
September 1.64 1.27 175
October 1.61 1.28 179
November 1.58 1.27 183
December 1.56 1.27 186
January 2015 1.53 1.31 182
February 1.52 1.35 181
March 1.51 1.38 181
11 The Annual General Meeting
The Annual General Meeting will be held on Tuesday, 13 September 2015 at
2.00pm and Group Head Office, Tubney Woods, Abingdon, Oxfordshire, OX13 5QX.
Principal Risks
Specific Risk Context Risk Possible Impact
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