REG - Rank Group PLC - Final Results <Origin Href="QuoteRef">RNK.L</Origin> - Part 2
29/10/2014 12:46
- Part 2: For the preceding part double click ID:nRSN0905Pa
description of the risks and uncertainties that they face.
The directors of The Rank Group Plc are:
Ian Burke
Henry Birch
Clive Jennings
The Rt. Hon. the Earl of Kilmorey, PC
Owen O'Donnell
Tim Scoble
Shaa Wasmund
Signed on behalf of the board on 13 August 2014
Henry Birch Clive Jennings
Chief Executive Finance Director
Group Financial Information
Group Income Statement
For the year ended 30 June 2014
Year ended Year ended
30 June 30 June
2014 2013
Before Exceptional Before Exceptional
exceptional items exceptional items
items (note 3) Total items (note 3) Total
£m £m £m £m £m £m
Continuing operations
Revenue before adjustment for free bets, promotions and customer bonuses 707.7 - 707.7 625.0 - 625.0
Free bets, promotions and customer bonuses (29.2) - (29.2) (28.8) - (28.8)
Revenue 678.5 - 678.5 596.2 - 596.2
Cost of sales (380.0) - (380.0) (329.6) - (329.6)
Gross profit 298.5 - 298.5 266.6 - 266.6
Other operating costs (226.1) (46.5) (272.6) (196.7) (17.7) (214.4)
Group operating profit (loss) 72.4 (46.5) 25.9 69.9 (17.7) 52.2
Financing:
- finance costs (10.1) (4.3) (14.4) (5.2) (4.2) (9.4)
- finance income 0.1 1.8 1.9 0.2 - 0.2
- other financial gains (losses) 1.0 - 1.0 (0.3) - (0.3)
Total net financing charge (9.0) (2.5) (11.5) (5.3) (4.2) (9.5)
Profit (loss) before taxation 63.4 (49.0) 14.4 64.6 (21.9) 42.7
Taxation (10.6) 13.6 3.0 (16.5) 2.7 (13.8)
Profit (loss) for the year from continuing operations 52.8 (35.4) 17.4 48.1 (19.2) 28.9
Discontinued operations - profit (loss) - 2.8 2.8 (5.6) 3.7 (1.9)
Profit (loss) for the year 52.8 (32.6) 20.2 42.5 (15.5) 27.0
Attributable to:
Equity holders of the parent 52.8 (32.6) 20.2 42.5 (15.5) 27.0
Earnings (loss) per share attributable to equity shareholders
- basic 13.5p (8.3)p 5.2p 10.9p (4.0)p 6.9p
- diluted 13.5p (8.3)p 5.2p 10.9p (4.0)p 6.9p
Earnings (loss) per share - continuing operations
- basic 13.5p (9.0)p 4.5p 12.3p (4.9)p 7.4p
- diluted 13.5p (9.0)p 4.5p 12.3p (4.9)p 7.4p
Earnings (loss) per share - discontinued operations
- basic - 0.7p 0.7p (1.4)p 0.9p (0.5)p
- diluted - 0.7p 0.7p (1.4)p 0.9p (0.5)p
Group Statement of Comprehensive Income
For the year ended 30 June 2014
Year ended Year ended
30 June 30 June
2014 2013
£m £m
Comprehensive income:
Profit for the year 20.2 27.0
Other comprehensive income:
Items that may be reclassified subsequently to profit or loss:
Exchange adjustments net of tax (2.4) 2.7
Items that will not be reclassified to profit or loss:
Actuarial (loss) gain on retirement benefits net of tax (0.3) 0.2
Total comprehensive income for the year 17.5 29.9
Attributable to:
Equity holders of the parent 17.5 29.9
Group Statement of Changes in Equity
For the year ended 30 June 2014
Capital Exchange Retained
Share Share redemption translation earnings
capital premium reserve reserve (losses) Total
£m £m £m £m £m £m
At 1 July 2012 54.2 98.3 33.4 13.4 28.7 228.0
Comprehensive income:
Profit for the year - - - - 27.0 27.0
Other comprehensive income:
Exchange adjustments net of tax - - - 2.7 - 2.7
Actuarial gain on retirement benefits net of tax - - - - 0.2 0.2
Total comprehensive income for the year - - - 2.7 27.2 29.9
Transactions with owners:
Shares issued - 0.1 - - - 0.1
Dividends paid to equity holders (see note 7) - - - - (14.7) (14.7)
Refund of unclaimed dividends (see note 7) - - - - 0.1 0.1
Debit in respect of employee share schemes including tax - - - - (1.5) (1.5)
At 30 June 2013 54.2 98.4 33.4 16.1 39.8 241.9
Comprehensive income:
Profit for the year - - - - 20.2 20.2
Other comprehensive income:
Exchange adjustments net of tax - - - (2.4) - (2.4)
Actuarial loss on retirement benefits net of tax - - - - (0.3) (0.3)
Total comprehensive (expense) income for the year - - - (2.4) 19.9 17.5
Transactions with owners:
Dividends paid to equity holders (see note 7) - - - - (16.4) (16.4)
Debit in respect of employee share schemes including tax - - - - (0.7) (0.7)
At 30 June 2014 54.2 98.4 33.4 13.7 42.6 242.3
Group Balance Sheet
At 30 June 2014
As at As at
30 June 30 June
2014 2013
(restated)1
£m £m
Assets
Non-current assets
Intangible assets 390.2 389.2
Property, plant and equipment 217.5 231.1
Deferred tax assets 2.5 2.6
Other receivables 3.1 2.9
613.3 625.8
Current assets
Inventories 3.1 3.3
Other receivables 31.1 32.1
Income tax receivable 6.6 6.3
Cash and short-term deposits 47.1 65.0
87.9 106.7
Assets held for sale - 0.3
Total assets 701.2 732.8
Liabilities
Current liabilities
Trade and other payables (113.2) (124.8)
Income tax payable (40.3) (42.2)
Financial liabilities - loans and borrowings (4.4) (7.4)
Provisions (10.5) (19.5)
(168.4) (193.9)
Net current liabilities (80.5) (87.2)
Non-current liabilities
Trade and other payables (40.5) (43.8)
Income tax payable - (21.7)
Financial liabilities - loans and borrowings (179.5) (161.1)
Deferred tax liabilities (18.1) (18.5)
Provisions (49.0) (48.8)
Retirement benefit obligations (3.4) (3.1)
(290.5) (297.0)
Total liabilities (458.9) (490.9)
Net assets 242.3 241.9
Capital and reserves attributable to the Company's equity shareholders
Share capital 54.2 54.2
Share premium 98.4 98.4
Capital redemption reserve 33.4 33.4
Exchange translation reserve 13.7 16.1
Retained earnings 42.6 39.8
Total shareholders' equity 242.3 241.9
1. The prior year comparative has been restated for the adjustments to the
provisional amounts recognised on the acquisition of Gala Casino 1 Limited
(now Grosvenor Casinos (GC) Limited). Further details are provided in notes 1
and 12.
Group Cash Flow Statement
For the year ended 30 June 2014
Year ended Year ended
30 June 30 June
2014 2013
(restated)1
£m £m
Cash flows from operating activities
Cash generated from operations 61.6 103.7
Interest received 0.1 0.2
Interest paid (8.2) (2.7)
Tax paid (19.1) (8.5)
Discontinued operations (6.6) (8.0)
Net cash from operating activities 27.8 84.7
Cash flows from investing activities
Acquisition of subsidiary including deferred consideration (net of cash acquired) 1.1 (178.6)
Purchase of intangible assets (13.5) (6.2)
Purchase of property, plant and equipment (30.8) (32.0)
Proceeds from sale of property, plant and equipment 0.3 0.1
Proceeds from sale of assets held for sale - 1.9
Disposal of business - 2.4
Discontinued operations - (1.1)
Net cash used in investing activities (42.9) (213.5)
Cash flows from financing activities
Dividends paid to equity holders (16.4) (14.7)
Refund of unclaimed dividends - 0.1
Proceeds from issue of shares - 0.1
Drawdown on revolving credit facilities 20.0 -
Proceeds from new term loans (net of fees) - 138.2
Finance lease principal payments (3.2) (3.2)
Net cash from financing activities 0.4 120.5
Net decrease in cash, cash equivalents and bank overdrafts (14.7) (8.3)
Effect of exchange rate changes (0.6) 0.3
Cash and cash equivalents at start of year 61.6 69.6
Cash and cash equivalents at end of year 46.3 61.6
1. The prior year comparative has been restated for the adjustments to the
provisional amounts recognised on the acquisition of Gala Casino 1 Limited
(now Grosvenor Casinos (GC) Limited). Further details are provided in notes 1
and 12.
1. General information, basis of preparation and accounting policies
General information
The Company is a public limited company which is listed on the London Stock
Exchange and is incorporated and domiciled in England and Wales under
registration number 03140769. The address of its registered office is
Statesman House, Stafferton Way, Maidenhead, SL6 1AY.
This condensed consolidated financial information was approved for issue on 13
August 2014.
This condensed consolidated financial information does not constitute
statutory accounts within the meaning of Section 434 of the Companies Act
2006. The statutory accounts for the year ended 30 June 2014 were approved by
the board of directors on 13 August 2014, but have not yet been delivered to
the Registrar of Companies. The report of the auditors on those accounts was
unqualified, did not contain an emphasis of matter paragraph and did not
contain a statement made under Section 498 of the Companies Act 2006. The
statutory accounts for the year ended 30 June 2013 have been delivered to the
Registrar of Companies.
In accordance with IFRS 3 'Business Combinations', the prior year comparatives
for the Group balance sheet and Group cash flow statement have been restated
for the adjustments to the provisional amounts recognised on the acquisition
of Gala Casino 1 Limited (now Grosvenor Casinos (GC) Limited). There is no
impact on the income statement reported in the prior year. The amounts
disclosed in the prior year were provisional due to the proximity of the
acquisition to the Group's year-end and the completion account process
outlined by the sale and purchase agreement extending beyond the finalisation
of the prior year financial statements. Further details are provided in note
12.
Basis of preparation
The financial information attached has been extracted from the audited
financial statements for the year ended 30 June 2014. The financial
information has been prepared in accordance with IFRS as adopted by the
European Union.
Going concern
In adopting the going concern basis for preparing the financial information
the directors have considered the issues impacting the Group during the period
as detailed in the business review above and have reviewed the Group's
projected compliance with its banking covenants. Based on the Group's cash
flow forecasts and operating budgets, and assuming trading does not
deteriorate considerably from those projected levels, the directors believe
that the Group will generate sufficient cash to meet its requirements for at
least the next 12 months and comply with its banking covenants. Accordingly
the adoption of the going concern basis remains appropriate.
Accounting policies
Except as described below, the accounting policies applied are consistent with
those of the annual financial statements for the year ended 30 June 2013, as
described in those financial statements.
The following new standards and amendments to existing standards are mandatory
for the first time for the financial period beginning 1 July 2013:
• IFRS1 First-time Adoption of International Reporting Standards - Government
Loans
• IFRS7 Financial Instruments: Disclosures - Offsetting Financial Assets and
Financial Liabilities (Amendment)
• IFRS13 Fair Value Measurement
• IAS19 Employee Benefits (Revised)
The Group has not been materially impacted by the adoption of any of these
standards or amendments.
The Group has not early adopted any other standard, amendment or
interpretation that was issued but is not yet effective.
2. Segment information - continuing operations
Year ended 30 June 2014
Grosvenor Casinos Mecca Enracha Central
Venues Digital Venues Digital Venues Digital costs Total
£m £m £m £m £m £m £m £m
Continuing operations
Group revenue reported in internal information 377.7 13.5 229.3 58.9 28.3 - - 707.7
Free bets, promotions and customer bonuses (3.7) (3.1) (12.5) (9.9) - - - (29.2)
Segment revenue 374.0 10.4 216.8 49.0 28.3 - - 678.5
Operating profit (loss) before exceptional items 57.7 (0.9) 21.1 15.9 1.2 (0.4) (22.2) 72.4
Exceptional loss (12.5) - (25.3) - (8.7) - - (46.5)
Segment result 45.2 (0.9) (4.2) 15.9 (7.5) (0.4) (22.2) 25.9
Finance costs (14.4)
Finance income 1.9
Other financial gains 1.0
Profit before taxation 14.4
Taxation 3.0
Profit for the year from continuing operations 17.4
Year ended 30 June 2013
Grosvenor Casinos Mecca Enracha Central
Venues Digital Venues Digital Venues Digital costs Total
£m £m £m £m £m £m £m £m
Continuing operations
Group revenue reported in internal information 290.5 9.8 234.9 61.3 28.5 - - 625.0
Free bets, promotions and customer bonuses (3.7) (2.2) (14.2) (8.7) - - - (28.8)
Segment revenue 286.8 7.6 220.7 52.6 28.5 - - 596.2
Operating profit (loss) before exceptional items 49.5 (2.1) 23.0 21.1 1.6 (0.9) (22.3) 69.9
Exceptional (loss) profit (15.0) - (2.0) - 0.3 - (1.0) (17.7)
Segment result 34.5 (2.1) 21.0 21.1 1.9 (0.9) (23.3) 52.2
Finance costs (9.4)
Finance income 0.2
Other financial losses (0.3)
Profit before taxation 42.7
Taxation (13.8)
Profit for the year from continuing operations 28.9
2. Segment information - continuing operations (continued)
To increase transparency, the Group has decided to include additional
disclosure analysing total costs by type and segment. A reconciliation of
total costs on continuing operations, before exceptional items, by type and
segment is as follows:
Year ended 30 June 2014
Grosvenor Casinos Mecca Enracha Central
Venues Digital Venues Digital Venues Digital costs Total
£m £m £m £m £m £m £m £m
Employment and related costs 137.7 2.0 55.2 6.5 13.4 0.2 15.2 230.2
Taxes and duties 78.1 - 48.1 0.4 2.1 - 2.0 130.7
Direct costs 15.6 3.9 21.0 14.5 2.5 0.1 - 57.6
Property costs 29.9 0.2 27.6 0.7 2.5 - 0.9 61.8
Marketing 13.2 2.6 10.4 7.0 0.9 - - 34.1
Depreciation and amortisation 22.1 2.0 13.8 2.4 2.1 - 1.2 43.6
Other 19.7 0.6 19.6 1.6 3.6 0.1 2.9 48.1
Total costs before exceptional items 316.3 11.3 195.7 33.1 27.1 0.4 22.2 606.1
Cost of sales 380.0
Operating costs 226.1
Total costs before exceptional items 606.1
Year ended 30 June 2013
Grosvenor Casinos Mecca Enracha Central
Venues Digital Venues Digital Venues Digital costs Total
£m £m £m £m £m £m £m £m
Employment and related costs 103.9 2.1 59.3 3.4 13.8 0.2 15.6 198.3
Taxes and duties 63.8 0.3 43.0 1.5 1.9 - 1.6 112.1
Direct costs 10.6 3.3 22.6 14.0 2.8 0.6 - 53.9
Property costs 19.8 0.3 27.0 0.6 2.0 - 0.9 50.6
Marketing 8.9 2.0 11.0 10.0 0.8 - 0.3 33.0
Depreciation and amortisation 17.7 1.5 14.6 1.5 2.4 - 1.2 38.9
Other 12.6 0.2 20.2 0.5 3.2 0.1 2.7 39.5
Total costs before exceptional items 237.3 9.7 197.7 31.5 26.9 0.9 22.3 526.3
Cost of sales 329.6
Operating costs 196.7
Total costs before exceptional items 526.3
3. Exceptional items
Year ended Year ended
30 June 30 June
2014 2013
£m £m
Exceptional items relating to continuing operations
Impairment charges (12.9) (9.4)
Impairment reversals 1.5 8.7
Net charge to provisions for property leases (6.6) (1.5)
Acquisition and integration costs (1.7) (8.5)
Restructuring costs (0.7) -
Net charge to provision for indirect taxation (26.1) (6.4)
Charge to accruals for indirect taxation - (0.6)
Exceptional operating costs (46.5) (17.7)
Finance costs (4.3) (4.2)
Finance income 1.8 -
Taxation 13.6 2.7
Exceptional items relating to continuing operations (35.4) (19.2)
Exceptional items relating to discontinued operations
Charge to provision for indirect taxation - (5.8)
Disposal of Blue Square Bet and related costs - (2.0)
Finance costs (0.3) (0.6)
Finance income 0.3 1.2
Taxation 2.8 10.9
Exceptional items relating to discontinued operations 2.8 3.7
Total exceptional items (32.6) (15.5)
Continuing operations - year ended 30 June 2014
Impairment charges
The Group recognised an impairment charge of £5.4m in the UK of which £4.3m
relates to Grosvenor Casinos venues and £1.1m to Mecca venues. The only
individually significant charges are £4.1m in respect of a single club in
Grosvenor Casinos venues and £0.7m in respect of a single club in Mecca
venues. Performance at these clubs has not been in line with expectations.
A further impairment charge of £7.5m has been recognised in respect of three
clubs in the Enracha venues business which have not performed in line with
expectations. This has followed a prolonged period of difficult economic
conditions in Spain.
A further impairment charge of £1.0m is included within integration costs
relating to essential post-acquisition capital expenditure, including signage,
at a small number of casinos that were fully impaired as part of the
acquisition accounting.
Impairment reversals
The Group has reversed previous impairment charges of £0.7m in the UK, all of
which relates to Mecca venues. The reversal is in respect of two clubs where
changes in the competitive and commercial environment have led to improvements
in performance.
A further reversal of £0.8m has been made in respect of a casino in Belgium
which has shown continuing improved performance above expectations.
Net charge to provisions for property leases
The Group has recognised a net charge of £6.6m in relation to provisions for
property leases in the period. This includes a charge of £6.8m in two
Grosvenor Casinos venues and three Mecca venues for unavoidable dilapidation
costs and where expected income no longer exceeds the unavoidable costs
associated with these sites. A further charge of £1.6m has been made in
respect of property lease costs directly attributable to the restructuring
outlined below.
A release to the income statement of £1.8m has been recognised in respect of
two Mecca venues where anticipated performance, following the reduction in
bingo duty, means that expected income will exceed the unavoidable costs
associated with these sites.
3. Exceptional items (continued)
Acquisition and integration costs
In the prior year the Group acquired 19 casinos and 3 non-operating licences
from Gala Coral Group Limited (see note 12). The Group has expensed the
resulting costs of integration during the year of £1.7m.
The integration was successfully completed during the year and no further
integration costs are expected.
Restructuring costs
During the year the Group recognised an exceptional cost of £0.7m relating to
the closure of one Mecca venue and one Enracha venue during the year and the
provision for the further cost associated with the closure of two further
Mecca venues and exit of one Enracha venue in early 2014/15. Included within
the charge to provisions for property leases is a further charge of £1.6m
connected with remaining property lease obligations at these venues.
Net charge to provision for indirect taxation
In the prior year the Group disclosed a contingent liability in respect of a
claim for repayment of output VAT on amusement machines. In May 2010, the
Group received £30.7m (VAT of £26.4m plus interest of £4.3m) in respect of the
claim, which has been the subject of on-going litigation. During the period,
the Court of Appeal found in favour of HMRC and consequently an amount of
£26.4m was provided to cover the expected outflow, together with associated
interest of £4.3m. In May 2014 a payment was made to HMRC in respect of these
claims, with the remaining balance being the directors' best estimate of the
outflow likely to arise. The Group has been granted leave to appeal to the
Supreme Court, and it therefore remains possible that the Group will not
ultimately be liable for these amounts. The appeal will be held in April
2015.
The Group also released £0.3m following the settlement in the period of the
indirect tax balances provided for in the prior year.
4. Discontinued operations
In the prior year the Group disposed of its loss making Blue Square Bet
business. In accordance with IFRS5 'Non-Current Assets Held for Sale and
Discontinued Operations', the results of the Blue Square Bet business were
classified as discontinued. No results were attributable to Blue Square Bet
in the current period, although the Group continued to discharge legacy
liabilities relating to the business.
Discontinued operations, other than those disclosed within exceptional items
(see note 3), related to the disposal of the loss making Blue Square Bet
business. A breakdown of results of this operation is shown below.
Year ended Year ended
30 June 30 June
2014 2013
£m £m
Revenue - 9.5
Operating loss - (7.4)
Taxation - 1.8
Loss after taxation - (5.6)
Other information:
Depreciation and amortisation - (1.4)
Capital expenditure - (1.1)
Cash flows relating to discontinued operations are as follows:
Operating loss - (7.4)
Depreciation and amortisation - 1.4
Interest paid (0.2) -
Cash payments in respect of exceptional items (6.4) (2.0)
Cash flows from operating activities (6.6) (8.0)
Cash flows from investing activities - (1.1)
Cash flows from financing activities - -
(6.6) (9.1)
4. Discontinued operations (continued)
The disposal of the Blue Square Bet business has given rise to the following
cash flow reported in investing activities:
Year ended Year ended
30 June 30 June
2014 2013
£m £m
Gross cash consideration received - 5.0
Payment to purchaser for customer account balances disposed - (2.6)
Disposal of business - 2.4
5. Financing
Year ended Year ended
30 June 30 June
2014 2013
£m £m
Continuing operations:
Finance costs:
Interest on debt and borrowings (6.4) (1.9)
Amortisation of issue costs on borrowings (1.5) (1.1)
Interest payable on finance leases (1.0) (0.9)
Unwinding of discount in property lease provisions (1.1) (1.1)
Unwinding of discount in disposal provisions (0.1) (0.2)
Total finance costs (10.1) (5.2)
Finance income:
Interest income on short term bank deposits 0.1 0.2
Total finance income 0.1 0.2
Other financial gains (losses) 1.0 (0.3)
Total net financing charge for continuing operations before exceptional items (9.0) (5.3)
Exceptional finance costs (4.3) (4.2)
Exceptional finance income 1.8 -
Total net financing charge for continuing operations (11.5) (9.5)
Discontinued operations:
Exceptional finance costs (0.3) (0.6)
Exceptional finance income 0.3 1.2
Total net finance income for discontinued operations - 0.6
Total net financing charge (11.5) (8.9)
Exceptional finance costs recognised in continuing operations in the year of
£4.3m are in respect of indirect taxation balances provided for.
Exceptional finance income recognised in continuing operations in the year of
£1.8m is in respect of the release of interest over accrued on direct and
indirect taxation balances provided for.
Exceptional finance costs recognised in discontinued operations in the year of
£0.3m relates to a decrease in interest receivable in respect of direct tax
receivables that are attributable to disposed entities.
Exceptional finance income recognised in discontinued operations in the year
of £0.3m relates to a reduction in interest accrued on indirect tax provisions
now settled.
5. Financing (continued)
A reconciliation of total net financing charge for continuing operations
before exceptional items to adjusted net interest included in adjusted profit
is disclosed below:
Year ended Year ended
30 June 30 June
2014 2013
£m £m
Total net financing charge for continuing operations before exceptional items (9.0) (5.3)
Adjust for :
Unwinding of discount in disposal provisions 0.1 0.2
Other financial (gains) losses - including foreign exchange (1.0) 0.3
Adjusted net interest payable (9.9) (4.8)
6. Taxation
Year ended 30 June 2014
Continuing operations Discontinued operations Total
£m £m £m
Current income tax
Current income tax - UK (12.4) - (12.4)
Current income tax - overseas (0.4) - (0.4)
Current income tax charge (12.8) - (12.8)
Current income tax on exceptional items 7.8 - 7.8
Amounts over provided in previous period 5.0 2.8 7.8
Amounts over provided in previous period on exceptional items 2.3 - 2.3
Total current income tax credit 2.3 2.8 5.1
Deferred tax
Deferred tax - UK (1.3) - (1.3)
Deferred tax - overseas (0.3) - (0.3)
Restatement of deferred tax from 23.0% to 20.0% 2.6 - 2.6
Deferred tax on exceptional items 3.5 - 3.5
Amounts under provided in previous period (3.8) - (3.8)
Total deferred tax credit 0.7 - 0.7
Tax credit in the income statement 3.0 2.8 5.8
Year ended 30 June 2013
Continuing operations Discontinued operations Total
£m £m £m
Current income tax
Current income tax - UK (12.7) 1.8 (10.9)
Current income tax - overseas (0.6) - (0.6)
Current income tax (charge) credit (13.3) 1.8 (11.5)
Current income tax on exceptional items 3.1 0.4 3.5
Amounts over provided in previous period 1.3 - 1.3
Amounts (under) over provided in previous period on exceptional items (0.3) 10.7 10.4
Total current income tax (charge) credit (9.2) 12.9 3.7
Deferred tax
Deferred tax - UK (3.0) - (3.0)
Deferred tax - overseas (0.2) - (0.2)
Deferred tax on exceptional items (0.1) - (0.1)
Amounts under provided in previous period (1.3) - (1.3)
Amounts under provided in previous period on exceptional items - (0.2) (0.2)
Total deferred tax charge (4.6) (0.2) (4.8)
Tax (charge) credit in the income statement (13.8) 12.7 (1.1)
6. Taxation (continued)
The tax effect of items within other comprehensive income was as follows:
Year ended Year ended
30 June 30 June
2014 2013
£m £m
Current income tax (charge) credit on exchange movements offset in reserves (0.2) 0.2
Deferred tax credit on actuarial movement on retirement benefits 0.1 -
Total tax (charge) credit on items within other comprehensive income (0.1) 0.2
The debit in respect of employee share schemes included within the Statement
of Changes in Equity includes a deferred tax charge of £0.3m (year ended 30
June 2013: credit of £0.3m) and a current tax credit of £nil (year ended 30
June 2013: £0.2m).
Factors affecting future taxation
UK corporation tax is calculated at 22.5% (year ended 30 June 2013: 23.75%) of
the estimated assessable profit for the period. Taxation for overseas
operations is calculated at the local prevailing rates.
On 20 March 2013, the Chancellor of the Exchequer announced the reduction in
the main rate of UK corporation tax to 21% with effect from 1 April 2014 and a
further 1% reduction to 20% from 1 April 2015. These changes were
substantively enacted in July 2013.
7. Dividends
Year ended Year ended
30 June 30 June
2014 2013
£m £m
Dividends paid to equity holders
Final for 2011/12 paid on 31 October 2012 - 2.50p per share - 9.8
Interim for 2012/13 paid on 22 March 2013 - 1.25p per share - 4.9
Final dividend for 2012/13 paid on 23 October 2013 - 2.85p per share 11.1 -
Interim dividend for 2013/14 paid on 21 March 2014 - 1.35p per share 5.3 -
Refund of unclaimed dividends - (0.1)
16.4 14.6
A final dividend in respect of the year ended 30 June 2014 of 3.15p per share,
amounting to a total dividend of £12.3m, is to be recommended at the annual
general meeting on 16 October 2014. These financial statements do not reflect
this dividend payable.
8. Adjusted earnings per share
Adjusted earnings is calculated by adjusting profit attributable to equity
shareholders to exclude discontinued operations, exceptional items, other
financial gains or losses, unwinding of the discount in disposal provisions
and the related tax effects. Adjusted earnings is one of the business
performance measures used internally by management to manage the operations of
the business. Management believes that the adjusted earnings measure assists
in providing a view of the underlying performance of the business.
Adjusted net earnings attributable to equity shareholders is derived as
follows:
Year ended Year ended
30 June 30 June
2014 2013
£m £m
Profit attributable to equity shareholders 20.2 27.0
Adjust for:
Discontinued operations (net of taxation) (2.8) 1.9
Exceptional items after tax on continuing operations 35.4 19.2
Other financial (gains) losses (1.0) 0.3
Unwinding of discount in disposal provisions 0.1 0.2
Taxation on adjusted items and impact of reduction in tax rate (3.3) (0.1)
Adjusted net earnings attributable to equity shareholders (£m) 48.6 48.5
Adjusted earnings per share (p) - basic 12.4p 12.4p
Adjusted earnings per share (p) - diluted 12.4p 12.4p
9. Provisions
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