REG - Serco Group PLC - Serco Group plc 2016 Full Year Results <Origin Href="QuoteRef">SRP.L</Origin> - Part 4
22/02/2017 07:07
- Part 4: For the preceding part double click ID:nRSV4908Xc
Items that will not be reclassified subsequently to profit or loss:
Net actuarial gain / (loss) on defined benefit pension schemes* 9.0 (15.8)
Actuarial gain / (loss) on reimbursable rights* 2.9 (0.4)
Tax relating to items not reclassified* (1.7) 4.1
Share of other comprehensive income in joint ventures and associates 14.8 5.0
Items that may be reclassified subsequently to profit or loss:
Net exchange gain / (loss) on translation of foreign operations** 80.3 (40.9)
Fair value gain on cash flow hedges during the year** 2.3 2.2
Share of other comprehensive income in joint ventures and associates 1.0 2.6
Total other comprehensive income / (expense) for the year 108.6 (43.2)
Total comprehensive income / (expense) for the year 107.5 (196.3)
Attributable to:
Equity owners of the Company 107.1 (195.9)
Non controlling interest 0.4 (0.4)
* Recorded in retirement benefit obligations reserve in the Consolidated Statement of Changes in Equity.
** Recorded in hedging and translation reserve in the Consolidated Statement of Changes in Equity.
Condensed consolidated statement of changes in equity
Share capital£m Share premium account £m Capital redemption reserve£m Retained earnings£m Retirement benefit obligations reserve£m Share based payment reserve£m Own shares reserve£m Hedging and translation reserve£m Total shareholders' equity£m Non controlling interest£m
At 1 January 2015 11.0 327.9 0.1 (306.0) (89.0) 71.4 (64.5) (18.9) (68.0) 1.8
Total comprehensive expense for the year - - - (145.0) (12.1) - - (38.8) (195.9) (0.4)
Issue of share capital* 11.0 - - 519.3 - - - - 530.3 -
Shares transferred to option holders on exercise of share options - - - - - (0.3) 4.7 - 4.4 -
Transfer on disposal - - - 0.2 (0.2) - - - - -
Expense in relation to share based payments - - - - - 9.8 - - 9.8 -
Change in non controlling interest - - - - - - - - - 0.1
At 31 December 2015 22.0 327.9 0.1 68.5 (101.3) 80.9 (59.8) (57.7) 280.6 1.5
Total comprehensive income for the year - - - 14.6 10.2 - - 82.3 107.1 0.4
Shares transferred to option holders on exercise of share options - - - - - (7.7) 7.7 - - -
Expense in relation to share based payments - - - - - 9.7 - - 9.7 -
Change in non controlling interest - - - - - - - - - (0.5)
At 31 December 2016 22.0 327.9 0.1 83.1 (91.1) 82.9 (52.1) 24.6 397.4 1.4
* During the prior year the Group raised £530.3m via a Rights Issue. A cash box structure was used in such a way that
merger relief was available under Companies Act 2006, section 612 and thus no share premium needed to be recorded. As the
redemption of the cash box entity's preference shares was in the form of cash, the transaction was treated as qualifying
consideration and the premium is therefore considered to be a realised profit.
Condensed consolidated balance sheet
At 31 December 2016 £m 2015
£m
Non-current assets
Goodwill 577.9 509.9
Other intangible assets 83.6 89.8
Property, plant and equipment 69.3 73.2
Interests in joint ventures and associates 14.4 13.8
Trade and other receivables 44.4 50.2
Derivative financial instruments 14.2 7.8
Deferred tax assets 50.8 42.2
Retirement benefit assets 150.4 127.1
1,005.0 914.0
Current assets
Inventories 22.4 26.4
Trade and other receivables 543.5 519.7
Current tax assets 11.0 6.6
Cash and cash equivalents 177.8 323.6
Derivative financial instruments 4.9 9.4
759.6 885.7
Assets classified as held for sale - 39.8
759.6 925.5
Total assets 1,764.6 1,839.5
Current liabilities
Trade and other payables (524.5) (548.8)
Derivative financial instruments (0.6) (2.4)
Current tax liabilities (25.9) (14.2)
Provisions (172.3) (168.6)
Obligations under finance leases (12.3) (15.8)
Loans (9.7) (132.2)
(745.3) (882.0)
Liabilities directly associated with assets classified as held for sale - (32.5)
(745.3) (914.5)
Non-current liabilities
Trade and other payables (16.8) (18.3)
Deferred tax liabilities (30.5) (22.3)
Provisions (249.4) (313.1)
Obligations under finance leases (15.9) (28.0)
Loans (290.2) (249.7)
Retirement benefit obligations (17.7) (11.5)
(620.5) (642.9)
Total liabilities (1,365.8) (1,557.4)
Net assets 398.8 282.1
Equity
Share capital 22.0 22.0
Share premium account 327.9 327.9
Capital redemption reserve 0.1 0.1
Retained earnings 83.1 68.5
Retirement benefit obligations reserve (91.1) (101.3)
Share based payment reserve 82.9 80.9
Own shares reserve (52.1) (59.8)
Hedging and translation reserve 24.6 (57.7)
Equity attributable to owners of the Company 397.4 280.6
Non-controlling interest 1.4 1.5
Total equity 398.8 282.1
Condensed consolidated cash flow statement For the year ended 31 December 2016
2016 £m 2015(restated*) £m
Net cash (outflow) / inflow from operating activities before exceptional items* (22.4) 37.2
Exceptional items (39.9) (56.6)
Net cash outflow from operating activities* (62.3) (19.4)
Investing activities
Interest received 1.4 3.4
(Decrease) / increase in security deposits (0.4) 0.3
Dividends received from joint ventures and associates 40.0 32.5
Proceeds from disposal of property, plant and equipment 0.6 0.8
Proceeds from disposal of intangible assets 0.1 0.9
Proceeds on disposal of subsidiaries and operations 19.4 165.6
Acquisition of subsidiaries, net of cash acquired (0.2) (0.2)
Purchase of other intangible assets (15.1) (37.5)
Purchase of property, plant and equipment (17.2) (36.7)
Net cash inflow from investing activities 28.6 129.1
Financing activities
Interest paid (20.1) (34.7)
Exceptional finance costs paid (0.3) (31.8)
Capitalised finance costs paid (0.3) (1.4)
Repayment of loans (135.5) (447.0)
Decrease / (increase) in loans to joint ventures and associates 1.1 (1.6)
Capital element of finance lease repayments (17.0) (18.8)
Cash gains from hedging instruments* 47.0 19.3
Rights Issue net proceeds - 530.3
Proceeds from issue of other share capital and exercise of share options - 4.4
Net cash (outflow) / inflow from financing activities* (125.1) 18.7
Net (decrease) / increase in cash and cash equivalents (158.8) 128.4
Cash and cash equivalents at beginning of year 323.6 180.1
Net exchange gain / (loss) 7.8 (2.1)
Cash reclassified to assets held for sale 5.2 17.2
Cash and cash equivalents at end of year 177.8 323.6
* Net cash outflow from operating activities and net cash (outflow) / inflow from financing activities have been
restated following the change in accounting policy regarding foreign exchange movements on investment and financing
arrangements. See note 1.
Notes to the Consolidated Financial Statements
1. General information, going concern and accounting policies
The basis of preparation in this preliminary announcement is set out below.
The financial information in this announcement does not constitute the Company's statutory accounts as defined in section
434 of the Companies Act 2006 for the years ended 31 December 2016 or 2015, but is derived from these accounts. The
auditors' report on the 2015 and 2016 accounts contained no emphasis of matter and did not contain statements under S498
(2) or (3) of the Companies Act 2006 or equivalent preceding legislation.
The preliminary announcement has been prepared in accordance with International Financial Reporting Standards adopted for
use in the European Union (IFRS). Whilst the financial information included in this preliminary announcement has been
computed in accordance with IFRS, this announcement does not itself contain sufficient information to comply with IFRS.
The Company expects to publish full Group and parent company only financial statements that comply with IFRS and FRS101
respectively, in March 2017.
The financial statements have been prepared on the historical cost basis, except for the revaluation of financial
instruments. Historical cost is generally based on the fair value of the consideration given in exchange for goods and
services. The following principal accounting policies adopted have been applied consistently in the current and preceding
financial year except as stated below.
Prior year restatement: Change in accounting policy
In order to provide more relevant information about the impact of the underlying transactions of trading operations, the
accounting policy regarding the classification of foreign exchange movements on investment and financing arrangements has
been changed. The new policy is to include foreign exchange movements on investment and financing arrangements within
investment revenue or finance costs as relevant. Such transactions include foreign exchange movements on non Sterling cash
and financing arrangements, related derivative financial instruments and any income or costs associated with such balances.
As a result of this change in accounting policy, the prior year income statement and cash flow statement have been
restated, together with the Net Debt definition which has been changed to include derivative financial instruments that
relate to other components of Net Debt. No restatement is required to the balance sheet as a result of the change in
policy.
The impact on the relevant line items in the consolidated financial statements and Net Debt for the year ended 31 December
2015 is as follows:
Consolidated income statement 2015 as previously stated£m Adjustment£m 2015 as restated£m
General and administrative expenses (253.9) (0.1) (254.0)
Finance costs (39.0) 0.1 (38.9)
Consolidated cash flow statement 2015 as previously stated£m Adjustment£m 2015 as restated£m
Net cash outflow from operating activities (0.1) (19.3) (19.4)
Net cash (outflow) / inflow from financing activities (0.6) 19.3 18.7
Analysis of Net Debt At 31 December 2015as previously stated £m Adjustment£m At 31 December 2015as restated £m
Cash and cash equivalents 323.6 - 323.6
Loan receivables 19.9 - 19.9
Loans payable (381.9) - (381.9)
Obligations under finance leases (43.8) - (43.8)
Derivatives relating to Net Debt - 14.6 14.6
(82.2) 14.6 (67.6)
Going concern
The Directors have a reasonable expectation that the Company and the Group will be able to operate within the level of
available facilities and cash for the foreseeable future and accordingly believe that it is appropriate to prepare the
financial statements on a going concern basis.
In assessing the basis of preparation of the financial statements for the year ended 31 December 2016, the Directors have
considered the principles of the Financial Reporting Council's 'Guidance on Risk Management, Internal Control and Related
Financial and Business Reporting, 2014'; namely assessing the applicability of the going concern basis, the review period
and disclosures. The Directors have undertaken a rigorous assessment of going concern and liquidity, taking into account
financial forecasts. In order to satisfy themselves that they have adequate resources for the future, the Directors have
reviewed the Group's existing debt levels, the committed funding and liquidity positions under our debt covenants, and our
ability to generate cash from trading activities. The Group's current principal debt facilities at the year end comprised
a £480m revolving credit facility, and £290m of US private placement notes. As at 31 December 2016, the Group had £770m of
committed credit facilities and committed headroom of £647m.
In undertaking this review the Directors have considered the business plans which provide financial projections for the
foreseeable future. For the purposes of this review, we consider that to be the period ending 30 June 2018.
Critical accounting judgements and key sources of estimation uncertainty
In the process of applying the Group's accounting policies, management has made the following judgements that have the most
significant effect on the amounts recognised in the financial statements. As described below, many of these areas of
judgement also involve a high level of estimation uncertainty.
Prior year restatement: Change in accounting policy
The accounting policy regarding the classification of foreign exchange movements in relation to investment and financing
arrangements was changed in the year. Judgement was applied in reaching the conclusion that it provides more relevant
financial results to exclude these amounts from the underlying transactions of trading operations.
Use of Alternative Performance Measures: Operating profit before exceptional items
IAS 1 requires material items to be disclosed separately in a way that enables users to assess the quality of a company's
profitability. In practice, these are commonly referred to as 'exceptional' items, but this is not a concept defined by
IFRS and therefore there is a level of judgement involved in arriving at an Alternative Performance Measure which excludes
such exceptional items. We consider items which are material, non-recurring and outside of the normal operating practice
of the company to be suitable for separate presentation.
The segmental analysis of continuing operations in note 3 includes the additional performance measure of Trading Profit on
continuing operations which is reconciled to reported operating profit in that note. The Group uses Trading Profit as an
alternative measure to reported operating profit by making several adjustments. Firstly, Trading Profit excludes
exceptional items, being those we consider material, non-recurring and outside of the normal operating practice of the
company to be suitable of separate presentation and detailed explanation. Secondly, amortisation and impairment of
intangibles arising on acquisitions are excluded, because these charges are based on judgments about the value and economic
life of assets that, in the case of items such as customer relationships, would not be capitalised in normal operating
practice. The CODM reviews the segmental analysis for continuing operations together with discontinued operations.
Provisions for onerous contracts
Determining whether provisions are required for loss making contracts requires significant judgements to be made regarding
the ability of the company to maintain or improve operational performance. Judgements can also be made regarding the
outcome of matters dependent on the behaviour of the customer in question or other parties involved in delivering the
contract.
The level of uncertainty in the estimates made, either in determining whether a provision is required, or in the
calculation of a provision booked, is linked to the complexity of the underlying contract and the form of service
delivery.
In the current year material revisions have been made to historic provisions, which have led to a charge to contract
provisions of £56.6m and releases of £65.5m. All of these revisions have resulted from triggering events in the current
year, either through changes in contractual positions or changes in circumstances which could not have been reasonably
foreseen at the previous balance sheet date. To mitigate the level of uncertainty in making these estimates Management
regularly compares actual performance of the contracts against previous forecasts and considers whether there have been any
changes to significant judgements. A detailed bottom up review of the provisions is performed as part of the Group's
formal annual budgeting process.
The individual provisions are discounted where the impact is assessed to be material. Discount rates used are calculated
based on the estimated risk free rate of interest for the region in which the provision is located and matched against the
ageing profile of the provision. Rates applied are in the range of 1.16% and 3.30%.
Impairment of assets
Identifying whether there are indicators of impairment for assets involves a high level of judgement and a good
understanding of the drivers of value behind the asset. At each reporting period an assessment is performed in order to
determine whether there are any such indicators, which involves considering the performance of our business and any
significant changes to the markets in which we operate. The total value of assets which are covered by this assessment
process (after previous impairments) is £1,340.9m, which is the maximum exposure related to this judgement. We mitigate
the risk associated with this judgement by putting in place processes and guidance for the finance community and internal
review procedures.
Determining whether assets with impairment indicators require an actual impairment involves an estimation of the expected
value in use of the asset (or CGU to which the asset relates). The value in use calculation involves an estimation of
future cash flows and also the selection of appropriate discount rates, both of which involve considerable judgement. The
future cash flows are derived from approved forecasts, with the key assumptions being revenue growth, margins and cash
conversion rates. Discount rates are calculated with reference to the specific risks associated with the assets and are
based on advice provided by external experts. Our calculation of discount rates are performed based on a risk free rate of
interest appropriate to the geographic location of the cash flows related to the asset being tested, which is subsequently
adjusted to factor in local market risks and risks specific to Serco and the asset itself. Discount rates used for
internal purposes are post tax rates, however for the purpose of impairment testing in accordance with IAS 36 Impairment of
Assets we calculate a pre tax rate based on post tax targets.
A key area of focus in recent years has been in the impairment testing of goodwill as a result of the pressure on the
results of the Group. While no further impairment of pre existing goodwill was noted in 2016, an impairment charge of
£17.8m did arise following the acquisition of a business in the year.
Deferred tax
Deferred tax assets are recognised for unused tax losses to the extent that it is probable that taxable profit will be
available against which the losses can be utilised. Significant management judgement is required to determine the amount
of deferred tax assets that can be recognised, based upon the likely timing and the level of future taxable profits.
As at the balance sheet date, the Group has unused tax losses of £893.5m (2015: £890.1m) available for offset against
future profits. A deferred tax asset has been recognised in respect of £69.1m (2015: £59.9m) of such losses of which
£58.8m (net £10.0m) relates to losses incurred in the UK and £10.3m (net £0.3m) which relates to other jurisdictions.
Recognition has been based on forecast future taxable profits. No deferred tax asset has been recognised in respect of the
remaining losses (net £147.0m) as it is not probable that there will be future taxable profits available.
Current tax
Liabilities for tax contingencies require management judgement and estimates in respect of tax audits and also tax
exposures in each of the jurisdictions in which we operate. Management is also required to make an estimate of the current
tax liability together with an assessment of the temporary differences that arise as a consequence of different accounting
and tax treatments. Key judgement areas include the correct allocation of profits and losses between the countries in which
we operate and the pricing of intercompany services. Where management conclude that a tax position is uncertain, a current
tax liability is held for anticipated taxes that are considered probable based on the current information available.
These liabilities can be built up over a long period of time but the ultimate resolution of tax exposures usually occurs at
a point in time, and given the inherent uncertainties in assessing the outcomes of these exposures, these estimates are
prone to change in future periods. It is not currently possible to estimate the timing of potential cash outflows, but on
resolution, to the extent this differs from the liability held, this will be reflected through the tax charge/(credit) for
that year. Each potential liability and contingency is revisited on an annual basis and adjusted to reflect any changes in
positions taken by the company, local tax audits, the expiry of the statute of limitations following the passage of time
and any change in the broader tax environment. The total current tax liability at December 2016 was £25.9m (2015:
£14.2m).
On the basis of the currently available information, the Group does not anticipate a material change to the estimated
liability in the coming year.
Retirement benefit obligations
Identifying whether the Group has a retirement benefit obligation as a result of contractual arrangements entered into
requires a level of judgement, largely driven by the legal position held between the Group, the customer and the relevant
pension scheme.
The calculation of retirement benefit obligations is dependent on material key assumptions including discount rates,
mortality rates, inflation rates and future contribution rates. The value of net retirement benefit obligations at the
balance sheet date is an asset of £132.7m (2015: £115.6m).
In accounting for the defined benefit schemes, the Group has applied the following principles:
· Asset recognised for SPLAS is based on the assumption that the full surplus will ultimately be available to the
Group as a future refund of surplus.
· No foreign exchange item is shown in the disclosures as the non UK liabilities are not material.
· No pension assets are invested in the Group's own financial instruments or property.
2. Discontinued operations
The Global Services division, representing UK onshore and offshore private sector BPO operations, was classified as a
discontinued operation in 2015. The completion of the sale of the majority of the offshore private sector BPO business
occurred on 31 December 2015. Disposal of one of the two remaining elements of the offshore business was completed in March
2016 and the final element completed in December 2016. The UK onshore private sector BPO businesses have been sold, or
have been exited early with the exception of one business where the sale process is ongoing and completion is expected
within the next twelve months.
The results of the discontinued operations were as follows:
For the year ended 31 December 2016£m 2015£m
Revenue 36.8 337.6
Expenses (40.1) (311.1)
Operating (loss) / profit before exceptional items (3.3) 26.5
Exceptional (loss) / profit on disposal of subsidiaries and operations (2.8) 5.4
Other exceptional operating items (11.4) (83.0)
Operating loss (17.5) (51.1)
Investment revenue - 2.1
Finance costs - (1.2)
Exceptional finance costs (0.4) -
Loss before tax (17.9) (50.2)
Tax charge on loss before exceptional items (0.1) (18.7)
Tax credit on exceptional items - 2.7
Net loss attributable to discontinued operations presented in the income statement (18.0) (66.2)
Attributable to:
Equity owners of the Company (18.1) (66.0)
Non controlling interests 0.1 (0.2)
Included above are items classified as exceptional as they are considered to be material, non recurring and outside of the
normal course of business. These are summarised as follows:
For the year ended 31 December 2016£m 2015 £m
Exceptional items arising on discontinued operations
Exceptional (loss) / profit on disposal (2.8) 5.4
Other exceptional operating items
Restructuring costs (1.1) (2.2)
Impairment of goodwill - (65.9)
Movements in indemnities provided on business disposals (13.7) -
Movement in the fair value of assets transferred to held for sale 3.4 (14.9)
Other exceptional operating items (11.4) (83.0)
Exceptional operating items arising on discontinued operations (14.2) (77.6)
In 2016 a charge of £1.1m (2015: £2.2m) has arisen in discontinued operations in relation to the restructuring programme
resulting from the Strategy Review. This includes redundancy payments, provisions and other charges relating to the exit
of the UK private sector BPO business, external advisory fees and other incremental costs.
During 2015, an impairment test of the Global Services business was conducted based on a level 3 fair value measurement,
with reference to offers received less costs of disposal. The impairment testing identified a non cash exceptional
impairment of goodwill relating to discontinued operations of £65.9m.
A charge of £13.7m has arisen in 2016 in relation to the movement in the value of indemnities provided on business
disposals made in previous years. This relates to changes in exchange rates where indemnities were provided in foreign
currencies and increases to provisions for interest and penalties on any indemnities.
The value of assets held for sale increased by £3.4m in 2016, reflecting the changing estimate of the likely proceeds and
movements of the assets held for sale since the prior balance sheet date. In 2015 the held for sale assets were impaired
by £14.9m.
A charge of £0.4m was incurred as a result of early payments to the US Private Placement (USPP) Noteholders following the
disposal of the offshore private sector BPO business. These charges are treated as exceptional finance costs as they are
directly linked to the restructuring resulting from the Strategy Review. Similar charges arose in 2015 which, together
with the costs related to the preservation of the Group's existing finance facilities, totalled £32.8m.
The net assets at the date of disposal of discontinued operations were:
Offshore£m UK onshore£m
Goodwill 8.0 -
Property, plant and equipment 1.0 -
Trade and other receivables 3.8 2.5
Cash and cash equivalents 5.6 -
Trade and other payables (4.2) 1.2
Minority interest disposed (0.5) -
Net assets disposed 13.7 3.7
The loss on disposal of discontinued operations is calculated as follows:
Offshore £m UK onshore £m Total £m
Consideration 15.2 3.5 18.7
Less:
Net assets disposed (13.7) (3.7) (17.4)
Disposal related costs (0.5) (1.4) (1.9)
Loss on disposal of discontinued operations prior to reserve recycling 1.0 (1.6) (0.6)
Recycling of gains on translation of foreign operations (2.2) - (2.2)
Exceptional loss on disposal (1.2) (1.6) (2.8)
The net cash inflow arising on disposal of discontinued operations and the impact on Net Debt is as follows:
Offshore £m UK onshore £m Total £m
Cash consideration 15.2 2.0 17.2
Less:
Cash and cash equivalents disposed (5.6) - (5.6)
Disposal related costs (0.5) (1.4) (1.9)
Net cash flow on disposal and movement in net debt 9.1 0.6 9.7
The net cash flows resulting from the discontinued operations were as follows:
For the year ended 31 December 2016 £m 2015 £m
Net cash inflow from operating activities before exceptional items 5.5 67.7
Exceptional items - (1.5)
Net cash inflow from operating activities 5.5 66.2
Net cash inflow from investing activities 12.5 93.5
Net cash outflow from financing activities (11.4) (26.5)
Net increase in cash and cash equivalents attributable to discontinued operations 6.6 133.2
3. Segmental information
The Group's operating segments reflecting the information reported to the Board in 2016 under IFRS 8 Operating Segments are
as set out below.
Reportable segments Operating segments
UK Central Government Services for sectors including Defence, Justice & Immigration and Transport delivered to UK Government and devolved authorities;
UK & Europe Local & Regional Government Services for sectors including Health and Citizen Services delivered to UK & European public sector customers;
AsPac Services for sectors including Defence, Justice & Immigration, Transport, Health and Citizen Services in the Asia Pacific region including Australia, New Zealand and Hong Kong;
Middle East Services for sectors including Defence, Transport and Health in the Middle East region;
Americas Services for sectors including Defence, Transport and Citizen Services delivered to US federal and civilian agencies, selected state and municipal governments and the Canadian Government; and
Corporate Central and head office costs.
Each operating segment is focused on a narrow group of customers in a specific geographic region and is run by a local
management team which report directly to the CODM on a regular basis. As a result of this focus, the sectors in each
region have similar economic characteristics and are aggregated at the operating segment level in these financial
statements. The accounting policies of the reportable segments are the same as the Group's accounting policies.
Geographic information
Year ended 31 December Revenue Non current assets* Revenue Non current assets*
2016 £m 2016 £m 2015 £m 2015 £m
United Kingdom 1,244.9 444.7 1,529.2 259.2
United States 632.9 309.1 632.0 347.7
Australia 593.1 146.0 514.7 125.5
Middle East 324.8 19.7 291.3 16.2
Other countries 215.3 20.4 209.8 34.0
Total 3,011.0 939.9 3,177.0 782.6
* Non current assets exclude financial instruments, deferred tax assets and loans to joint ventures and associates and
include held for sale assets. There are no held for sale items in 2016. 2015 includes held for sale assets of £1.2m.
Revenues from external customers are attributed to individual countries on the basis of the location of the customer.
Information about major customers
The Group has three major governmental customers which each represent more than 10% of Group revenues. The customers'
revenues were £1,233.7m for the UK Government across the UK Central Government and UK & Europe Local & Regional Government
segments, £623.1m for the US Government within the Americas segment, and £581.4m for the Australian Government within the
AsPac segment.
In 2015 the Group had two major governmental customers which each represented more than 10% of Group revenues. The
customers' revenues were £1,480.9m for the UK Government across the UK Central Government and UK & Europe Local & Regional
Government segments, and £558.5m for the US Government within the Americas segment.
The following is an analysis of the Group's revenue, results, assets and liabilities by reportable segment:
Year ended 31 December 2016 CG £m LRG £m AsPac £m Middle East £m Americas £m Corporate £m Total £m
Revenue 678.6 696.5 619.7 324.8 691.4 - 3,011.0
Result
Trading profit / (loss) from continuing operations 94.9 (10.4) 34.2 18.8 6.4 (40.3) 103.6
Amortisation and impairment of intangibles arising on acquisition (0.3) - (2.0) - (2.8) - (5.1)
Operating profit / (loss) before exceptional items 94.6 (10.4) 32.2 18.8 3.6 (40.3) 98.5
Exceptional profit / (loss) on disposal of subsidiaries and operations (0.1) 4.5 0.4 - - (1.9) 2.9
Other exceptional operating items (11.1) (14.8) (0.9) - - (32.4) (59.2)
Operating profit / (loss) 83.4 (20.7) 31.7 18.8 3.6 (74.6) 42.2
Investment revenue 9.3
Finance costs (21.9)
Profit before tax 29.6
Tax charge (15.8)
Tax on exceptional items 3.1
Profit for the year from continuing operations 16.9
Supplementary information
Share of profits in joint ventures and associates, net of interest and tax 31.3 - 2.0 - - 0.1 33.4
Depreciation of plant, property and equipment (2.1) (12.9) (4.5) (0.9) (3.1) (1.3) (24.8)
Impairment of plant, property and equipment (0.3) - (0.4) - - - (0.7)
Total depreciation and impairment of plant, property and equipment (2.4) (12.9) (4.9) (0.9) (3.1) (1.3) (25.5)
Amortisation of intangible assets arising on acquisition (0.3) - (1.3) - (2.8) - (4.4)
Impairment and write down of intangible assets arising on acquisition - - (0.7) - - - (0.7)
Amortisation of other intangible assets (0.1) (0.5) (3.3) (0.7) (1.5) (15.7) (21.8)
Total amortisation and impairment of intangible assets (0.4) (0.5) (5.3) (0.7) (4.3) (15.7) (26.9)
Segment assets
Interests in joint ventures and associates 12.3 - 1.7 0.4 - - 14.4
Other segment assets 168.7 298.3 252.1 108.7 428.8 228.6 1,485.2
Total segment assets 181.0 298.3 253.8 109.1 428.8 228.6 1,499.6
Unallocated assets 265.0
Consolidated total assets 1,764.6
Segment liabilities
Segment liabilities (279.1) (163.8) (182.8) (79.3) (140.7) (139.7) (985.4)
Unallocated liabilities (380.4)
Consolidated total liabilities (1,365.8)
Year ended 31 December 2015 (restated*) CG £m LRG £m AsPac £m Middle East £m Americas £m Corporate £m Total £m
Revenue 742.1 905.8 544.7 291.4 693.0 - 3,177.0
Result
Trading profit / (loss) from continuing operations* **
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