REG - Savills PLC - Final Results <Origin Href="QuoteRef">SVS.L</Origin> - Part 2
19/03/2015 07:01
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90.1 - 17.1 159.4 270.0 0.8 270.8
Savills plc
Consolidated statement of cash flows
for the year ended 31 December 2014
2014 2013
Notes £m £m
Cash flows from operating activities
Cash generated from operations 7 113.6 86.0
Interest received 1.6 1.0
Interest paid (2.0) (0.6)
Income tax paid (17.1) (15.6)
Net cash generated from operating activities 96.1 70.8
Cash flows from investing activities
Proceeds from sale of property, plant and equipment 0.1 0.1
Proceeds from sale of available-for-sale investments 4.0 1.7
Proceeds from sale of assets held for sale 8.5 -
Deferred consideration received in relation to prior year disposals 1.4 0.4
Dividends received from joint ventures and associates 5.4 5.3
Repayment of loans by joint ventures and associates 0.8 0.3
Loans to joint ventures and associates - (0.4)
Acquisition of subsidiaries, net of cash acquired 9 (18.1) 1.0
Deferred consideration paid in relation to prior year acquisitions - (0.4)
Purchase of property, plant and equipment (12.7) (23.3)
Purchase of intangible assets (1.5) (2.5)
Purchase of investment in joint ventures, associates and available-for-sale investments (2.5) (0.7)
Net cash used in investing activities (14.6) (18.5)
Cash flows from financing activities
Proceeds from issue of share capital - 2.9
Proceeds from borrowings 10 99.9 63.5
Share-based payment settlement (3.6) (7.3)
Purchase of own shares for Employee Benefit Trust (12.1) (2.2)
Purchase of non-controlling interests 8 (1.9) (1.1)
Repayments of borrowings 10 (105.8) (54.8)
Dividends paid 5 (25.2) (21.0)
Net cash used in financing activities (48.7) (20.0)
Net increase in cash, cash equivalents and bank overdrafts 32.8 32.3
Cash, cash equivalents and bank overdrafts at beginning of year 122.2 92.7
Effect of exchange rate fluctuations on cash held 3.1 (2.8)
Cash and cash equivalents at end of year 158.1 122.2
NOTES
1. Basis of preparation
The results for the year ended 31 December 2014 have been extracted from the
audited financial statements. The financial statements have been prepared in
accordance with International Financial Reporting Standards (IFRSs) and IFRIC
interpretations as adopted by the European Union and with those parts of the
Companies Act 2006 applicable to companies reporting under IFRS.
The financial information in this statement does not constitute statutory
accounts within the meaning of s434 of the Companies Act 2006. The statutory
accounts for the year ended 31 December 2014, on which the auditors have given
an unqualified audit report, have not yet been filed with the Registrar of
Companies.
The preparation of financial statements in conformity with IFRS requires the
use of estimates and assumptions that affect the reported amounts of assets
and liabilities at the date of the financial statements and the reported
amounts of revenues and expenses during the reporting period. Although these
estimates are based on management's best knowledge of the amount, event or
actions, actual results ultimately may differ from those estimates.
2. Segment analysis
Transaction Advisory Consultancy Property and Facilities Management Investment Management Other Total
Year ended to 31 December 2014 £m £m £m £m £m £m
Revenue
United Kingdom
- commercial 84.1 126.9 79.8 28.0 - 318.8
- residential 129.2 41.3 25.1 - - 195.6
Total United Kingdom 213.3 168.2 104.9 28.0 - 514.4
Continental Europe 51.1 18.8 26.6 - - 96.5
Asia Pacific
- commercial 96.3 30.0 207.1 - - 333.4
- residential 21.6 - - - - 21.6
Total Asia Pacific 117.9 30.0 207.1 - - 355.0
United States 112.3 - - - - 112.3
Total revenue 494.6 217.0 338.6 28.0 - 1,078.2
Underlying profit/(loss) before tax
United Kingdom
- commercial 14.0 13.1 7.3 4.4 (13.7) 25.1
- residential 19.7 6.3 2.2 - - 28.2
Total United Kingdom 33.7 19.4 9.5 4.4 (13.7) 53.3
Continental Europe 1.3 1.4 (2.6) - - 0.1
Asia Pacific
- commercial 16.7 2.6 11.7 - - 31.0
- residential 3.7 - - - - 3.7
Total Asia Pacific 20.4 2.6 11.7 - - 34.7
United States 12.4 - - - - 12.4
Underlying profit/(loss) before tax 67.8 23.4 18.6 4.4 (13.7) 100.5
Transaction Advisory Consultancy Property and Facilities Management Investment Management Other Total
Year ended to 31 December 2013 £m £m £m £m £m £m
Revenue
United Kingdom
- commercial 73.4 115.6 73.2 26.0 - 288.2
- residential 118.0 33.1 23.0 - - 174.1
Total United Kingdom 191.4 148.7 96.2 26.0 - 462.3
Continental Europe 38.0 15.6 27.7 - - 81.3
Asia Pacific
- commercial 99.3 27.3 205.1 - - 331.7
- residential 22.7 - - - - 22.7
Total Asia Pacific 122.0 27.3 205.1 - - 354.4
United States 6.8 - - - - 6.8
Total revenue 358.2 191.6 329.0 26.0 - 904.8
Underlying profit/(loss) before tax
United Kingdom
- commercial 10.3 9.4 6.5 2.9 (10.1) 19.0
- residential 19.0 4.9 2.3 - - 26.2
Total United Kingdom 29.3 14.3 8.8 2.9 (10.1) 45.2
Continental Europe (3.0) 1.4 (2.3) - - (3.9)
Asia Pacific
- commercial 16.6 1.9 11.1 - - 29.6
- residential 5.9 - - - - 5.9
Total Asia Pacific 22.5 1.9 11.1 - - 35.5
United States (1.6) - - - - (1.6)
Underlying profit/(loss) before tax 47.2 17.6 17.6 2.9 (10.1) 75.2
Operating segments reflect internal management reporting to the Group's chief
operating decision maker, defined as the Group Executive Board (GEB). The GEB
assesses the performance of operating segments based on a measure of
underlying profit before tax which adjusts reported pre-tax profit by
profit/(loss) on disposals, share-based payment adjustment, restructuring
costs, acquisition related costs, amortisation and impairment of goodwill and
intangible assets (excluding software) and impairment of available-for-sale
investments, joint ventures or associates.
The Other segment includes costs and other expenses at holding company and
subsidiary levels, which are not directly attributable to the operating
activities of the Group's business segments.
A reconciliation of underlying profit before tax to reported profit before tax
is provided in Note 3.
3. Underlying profit before tax
The Directors seek to present a measure of underlying performance which is not
impacted by exceptional items or items considered non-operational in nature.
This measure of profit is described as 'underlying' and is used by management
to measure and monitor performance.
2014 2013
£m £m
Reported profit before tax 84.7 70.1
Adjustments:
- Amortisation of intangible assets (excluding software) 2.6 2.1
- Impairment of available-for-sale investments 0.6 -
- Share-based payment adjustment (2.9) (2.5)
- (Profit)/loss on disposal of available-for-sale investments (2.0) 0.3
- Restructuring costs 0.9 5.2
- Acquisition related costs 16.6 -
Underlying profit before tax 100.5 75.2
The adjustment for share-based payment relates to the impact of the accounting
standard for share-based compensation. The annual bonus is paid in a mixture
of cash and deferred shares and the proportions can vary from one year to
another. Under IFRS the deferred share element is amortised to the income
statement over the vesting period whilst the cash element is expensed in the
year. The adjustment above addresses this by deducting from profit the
difference between the IFRS 2 charge and the effective value of the annual
share award in order better to match the underlying staff costs in the year
with the revenue recognised in the same period.
Profit on disposal of available-for-sale investments includes a £1.7m profit
from the disposal of the Group's 3.03% holding in Pinnacle Regeneration Group
Limited in January 2014, the final receipt in relation to the disposal of the
Group's 4.3% shareholding in IPD Group Ltd in 2012 (£0.5m) and a £0.2m loss
arising from the disposal of the Group's 2.03% shareholding in the Cordea
Savills Student Hall Fund in July 2014.
Acquisition related costs include transaction costs of £6.7m and £9.9m of
provisions for future payments in relation to the Studley Inc. acquisition,
which are expensed through the income statement to reflect the requirement for
the recipients to remain actively engaged in the business at the payment date.
Refer to Note 9 for further details.
4. Income tax expense
The income tax expense has been calculated on the basis of the underlying rate
in each jurisdiction adjusted for any disallowable charges.
2014 2013
£m £m
United Kingdom
- Current tax 14.8 12.7
- Deferred tax (1.9) (1.5)
Foreign tax
- Current tax 12.2 8.0
- Deferred tax (3.1) (0.5)
Income tax expense 22.0 18.7
5. Dividends
2014 2013
£m £m
Amounts recognised as distribution to equity holders in the year:
Ordinary final dividend for 2013 of 7.0p per share (2012: 6.7p) 9.0 8.5
Supplemental interim dividend for 2013 of 8.5p per share (2012: 6.0p) 11.0 7.6
Interim dividend of 3.75p per share (2013: 3.5p) 4.9 4.5
24.9 20.6
The Board recommends a final dividend of 7.25p (net) per ordinary share
(amounting to £9.4m) is paid, alongside the supplemental interim dividend of
12.0p per ordinary share (amounting to £15.5m), to be paid on 18 May 2015 to
shareholders on the register at 17 April 2015. These financial statements do
not reflect this dividend payable.
The total paid and recommended ordinary and supplemental dividends for the
2014 financial year comprises an aggregate distribution of 23.0p per ordinary
share (2013: 19.0p per ordinary share).
6(a). Basic and diluted earnings per share
2014 2014 2014 2013 2013 2013
Earnings Shares EPS Earnings Shares EPS
Year to 31 December £m million pence £m million pence
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