REG - Tullett Prebon Plc - Acquisition <Origin Href="QuoteRef">TLPR.L</Origin> - Part 2
11/11/2015 07:23
- Part 2: For the preceding part double click ID:nRSK2768Fa
Total comprehensive profit/(loss) for the period 22 (22) 46 4 28
Total comprehensive profit/(loss) attributable to:
Owners of the group 21 (19) 45 4 30
Non-controlling interests 1 (3) 1 -- (2)
22 (22) 46 4 28
IGBB combined balance sheet
As at31 March 2013£m As at31 March 2014 As at31 March 2015 As at30 September2015
£m £m £m
Assets
Non-current assets
Intangible assets arising on consolidation 96 80 82 82
Intangible assets from development expenditure 32 48 44 46
Property and equipment 35 30 26 24
Investment in joint ventures 8 5 7 7
Investment in associates 32 36 36 37
Available-for-sale investments 22 12 9 11
Deferred tax asset 21 15 12 10
Trade and other receivables 4 1 2 1
Retirement benefit assets 1 -- -- --
251 227 218 218
Current assets
Trade and other receivables 16,793 22,757 24,236 17,468
Receivable from affiliates 98 112 122 78
Available-for-sale investments -- -- -- 1
Restricted funds 33 35 35 27
Cash and cash equivalents 439 368 350 359
17,363 23,272 24,743 17,933
Total assets 17,614 23,499 24,961 18,151
Liabilities
Current liabilities
Trade and other payables (16,751) (22,725) (24,194) (17,428)
Payable to affiliates (104) (92) (75) (38)
Bank overdraft (1) (1) (33) (7)
Tax payable (46) (21) (30) (23)
Provisions -- (8) (14) (16)
(16,902) (22,847) (24,346) (17,512)
Non-current liabilities
Trade and other payables (7) (6) (6) (5)
Deferred tax liabilities (12) (7) (11) (12)
Retirement benefit obligations (3) (2) (4) (3)
Provisions (12) (10) (20) (18)
(34) (25) (41) (38)
Total liabilities (16,936) (22,872) (24,387) (17,550)
Net assets 678 627 574 601
Invested capital
Invested capital attributable to:
Owners of the group 640 602 548 579
Non-controlling interests 38 25 26 22
Total invested capital 678 627 574 601
IGBB combined statement of changes in invested capital
Six months ended 30 September 2015 Owners Non-controlling interests Total
£m £m £m
Balance as at 1 April 2015 548 26 574
Profit/(loss) for the period 34 (2) 32
Other comprehensive profit for the period, net of tax (4) -- (4)
Total comprehensive profit for the period 30 (2) 28
Net distributions in the period 1 -- 1
Other movements in non-controlling interests -- (2) (2)
Balance as at 30 September 2015 579 22 601
Year ended 31 March 2015 Owners Non-controlling interests Total
£m £m £m
Balance as at 1 April 2014 602 25 627
Profit/(loss) for the year 22 (1) 21
Other comprehensive profit for the year, net of tax 23 2 25
Total comprehensive profit for the year 45 1 46
Net cash distributions in the year (99) -- (99)
Balance as at 31 March 2015 548 26 574
Year ended 31 March 2014 Owners Non-controlling interests Total
£m £m £m
Balance as at 1 April 2013 640 38 678
Profit/(loss) for the year 46 (2) 44
Other comprehensive loss for the year, net of tax (65) (1) (66)
Total comprehensive loss for the year (19) (3) (22)
Net cash distributions in the year (19) -- (19)
Dividend to non-controlling interests* -- (10) (10)
Balance as at 31 March 2014 602 25 627
* Dividend payments to non-controlling interest of an IGBB subsidiary.
Year ended 31 March 2013 Owners Non-controlling interests Total
£m £m £m
Balance as at 1 April 2012 723 42 765
Profit for the year 8 1 9
Other comprehensive profit for the year, net of tax 13 -- 13
Total comprehensive profit for the year 21 1 22
Net cash distributions in year (104) -- (104)
Other movements in non-controlling interests -- (5) (5)
Balance as at 31 March 2013 640 38 678
IGBB combined statement of cash flows
Year ended 6 months ended
31 March 2013 31 March 2014 31 March 2015 30 Sep. 2014£m 30 Sep. 2015£m
£m £m £m
Cash flows from operating activities 122 (8) 24 (52) 58
Cash flows from investing activities
Dividends received from associates 1 4 4 4 3
Dividends received from joint ventures -- 5 1 1 --
Other equity dividends received 2 2 -- -- --
Payments to acquire property and equipment (1) (7) (3) (4) (2)
Intangible development expenditure (31) (28) (16) (18) (9)
Proceeds from disposal of subsidiary -- -- 1 -- --
Proceeds from disposal of available-for-sale investments 3 -- -- -- --
Acquisition of available-for-sale investments -- -- -- -- (3)
Acquisition of associates and joint ventures (2) -- (1) -- --
Net cash flows from investing activities (28) (24) (14) (17) (11)
Cash flows from financing activities
Dividends paid to non-controlling interest* -- (10) -- -- --
Net cash distributions from/(to) affiliates (103) (22) (131) (12) 1
Net cash flows from financing activities (103) (32) (131) (12) 1
Net (decrease)/increase in cash and cash equivalents (9) (64) (121) (81) 48
Cash and cash equivalents at beginning of the period** 410 438 367 367 317
FX adjustments 37 (7) 71 21 (13)
Cash and cash equivalents at end of the period** 438 367 317 307 352
*Dividend payments to non-controlling interest of an IGBB subsidiary. **Net of bank overdraft.
Appendix 2 - Basis of preparation
Preparation of Combined Financial Information
The combined financial information of IGBB (the "Combined Financial
Information") has been prepared on a basis that combines the results and
assets and liabilities of IGBB by applying the principles underlying the
consolidation procedures of IFRS 10 (revised) "Consolidated Financial
Statements". The Combined Financial Information has been prepared from the
ICAP consolidation schedules which include the individual financial returns of
IGBB companies and the ICAP consolidation and other adjustments attributable
to IGBB entities and businesses.
This basis of preparation describes how the Combined Financial Information has
been prepared in accordance with International Financial Reporting Standards
("IFRSs") as adopted by the European Union and as issued by the International
Accounting Standards Board. References to IFRSs hereafter should be construed
as references to IFRSs as adopted by the EU. IFRS does not provide for the
preparation of combined financial information or for specific accounting
treatment set out below, and accordingly, in preparing the Combined Financial
Information, certain accounting conventions commonly used for the preparation
of historical financial information for inclusion in investment circulars as
described in the Annexure to SIR 2000 "Standards for
Investment Reporting applicable to public reporting engagements on historical
financial information" issued by the UK Auditing Practices Board have been
applied.
The accounting policies that were in force as at 1 April 2014 and were adopted
by ICAP for the financial year ending 31 March 2015 were applied in the
preparation of the Combined Financial Information for all periods.
Measurement and presentation of IGBB's financial statements for the years
ending 31 March 2013 and 31
March 2014 were restated based on new IFRSs and/or changes in IFRSs that were
adopted by ICAP for the first time from 1 April 2014.
The preparation of Combined Financial Information requires ICAP management to
apply judgements and the use of estimates and assumptions about future
conditions. ICAP management considers impairment review of goodwill and other
intangible assets arising on consolidation to be the area requiring exercise
of increased judgement. Estimates and assumptions are continuously evaluated
and are based on historical experience and other factors, including
expectations of future events that are believed to be reasonable under the
circumstances.
Due to the inherent uncertainty in making estimates, actual results reported
in future periods may be based on amounts which differ from those estimates.
Revisions to accounting estimates are recognised in the period in which the
estimate is revised and in any future periods affected.
The following summarises the key accounting and other principles applied in
preparing the Combined Financial Information:
· IGBB has not in the past constituted a separate legal group and
therefore it is not meaningful to show share capital or an analysis of
reserves for IGBB. The net assets of IGBB are represented by invested capital,
the cumulative investment of ICAP and its subsidiaries (that are not part of
IGBB together with associates and joint ventures "ICAP Affiliates" or
"Affiliates"). Any funding to, investments in and dividends received from/paid
to ICAP affiliates are shown as movements in invested capital.
· The trading results of IGBB are stated after the allocation of ICAP
head office and corporate costs comprising those directly attributable to IGBB
and of indirect costs consistent with the historical allocations to ICAP's
operating segments. Certain indirect costs (which for the year ended 31 March
2015 amounted to £14m), are not to be charged to IGBB by ICAP following
Completion. The results of IGBB presented might have been different had the
entities operated as a separate group from 1 April 2012. The results are not
necessarily indicative of future periods since the relationship of costs in
respect of IGBB functions and services provided by ICAP affiliates and related
parties may be different.
· The tax charges in the Combined Financial Information have been
determined based on the analysis of ICAP's tax charge and assessment of how
much is attributable to IGBB, taking into account legal entity charges and
applicable group level adjustments. The tax charges recorded in the combined
income statement may have been affected by the taxation arrangements within
ICAP, and are not necessarily representative of the tax charges that could
apply in the future.
· Current tax receivable/payable and deferred tax assets and liabilities
were determined based on the analysis of ICAP's current tax position and
temporary differences at each period end and assessment of how these relate
directly or indirectly to IGBB.
· Tax payments made in the year as presented in the combined statement
of cash flows have been determined based on the aggregated payments made by
IGBB entities including service companies. IGBB cash outflows relating to tax
are not necessarily representative of tax payments that would be made by IGBB
in the future.
· Transactions and balances between entities included within IGBB have
been eliminated.
· Trading balances between IGBB entities and other ICAP companies have
been presented in the combined balance sheet as current receivables and
current payables.
· Assets including intangible assets arising from development
expenditures and property and equipment in the combined balance sheet have
been determined based on the assets recorded in IGBB companies, excluding
assets recorded in IGBB service companies that are attributable to other
businesses of ICAP outside IGBB but including shared assets of £30m as at 30
September 2015. This approach follows how management views assets employed by
each ICAP operating segment. The same approach has been adopted to determine
the amortisation and depreciation expenses relating to these assets in the
combined income statement. The shared assets, which as at 30 September 2015
were £30m, are not to be acquired by Tullett Prebon under the terms of the
SPA.
· The Combined Financial Information does not include borrowings and the
finance costs associated with those borrowings. Funding is made available to
IGBB as part of central treasury arrangements within ICAP. Therefore the
finance costs and liabilities in the IGBB's combined income statement and
combined balance sheet are not necessarily representative of finance costs and
liabilities that may arise if IGBB was seen in isolation.
Presentation of the combined income statement
IGBB has presented its combined income statement in a columnar format, which
enables IGBB to improve the understanding of its results by presenting its
trading profit, which is reconciled to profit before tax on the face of the
combined income statement.
The column 'acquisitions and disposal costs' includes: any gains, losses or
other associated costs on the full or partial disposal of investments,
associates, joint ventures or subsidiaries and costs associated with a
combination that do not constitute fees relating to the arrangement of
financing; amortisation or impairment of intangible assets arising on
consolidation; any re-measurement after initial recognition of deferred
contingent consideration which has been classified as a liability; any gains
or losses on the revaluation of previous interests. The column may also
include items such as gains or losses on the settlement of pre-existing
relationships with acquired businesses and the re-measurement of liabilities
that are above the value of indemnification.
Items which are of a non-recurring nature and material, when considering both
size and nature, are disclosed separately to give a clearer presentation of
IGBB's results. These are shown as 'exceptional items' on the face of the
combined income statement.
Foreign currencies
In individual entities, transactions denominated in foreign currencies are
recorded at the prior month closing exchange rate between the functional
currency and the foreign currency. At the end of each reporting period,
monetary assets and liabilities that are denominated in foreign currencies are
retranslated at the rates prevailing at the end of the reporting period.
Exchange differences are recognised in the combined income statement, except
for exchange differences arising on non-monetary assets and liabilities where
these form part of the net investment of an overseas business or are
designated as hedges of a net investment or cash flow and, therefore, the
changes in value resulting from exchange differences are recognised directly
in other comprehensive income.
On combination, the results of businesses with non-pound sterling functional
currencies are translated into the presentational currency of IGBB at the
average exchange rates for the year where these approximate to the rate at the
date of the transactions. Assets and liabilities of overseas businesses are
translated into the presentational currency of IGBB at the exchange rate
prevailing at the end of the reporting period. Exchange differences arising
are recognised within other comprehensive income.
Goodwill and fair value adjustments arising on the acquisition of a non-pound
sterling entity are treated as assets and liabilities of that entity and
translated into the presentational currency of IGBB at the period closing
rate.
Where applicable, IGBB has elected to treat goodwill and fair value
adjustments arising before the date of transition to IFRS as denominated in
the presentational currency of IGBB.
In the combined statement of cash flows, cash flows denominated in foreign
currencies are translated into the presentational currency of IGBB at the
average exchange rates for the year or at the rate prevailing at the time of
the transaction where more appropriate.
Risk management
IGBB as part of its day-to-day operations faces certain risks including
liquidity risk, credit risk, financial and market risks including interest
rate risk and currency translation risks. These risks are maintained and
managed centrally as part of IGBB's risk management framework.
1 Twelve months to 30 June 2015 derived from Tullett Prebon's published
results for the year ended 31 December 2014 and for the six month periods
ended 30 June 2015 and 30 June 2014, adjusted for the full year impact of PVM,
MOAB and Murphy & Durieu.
2 Twelve months to 30 September 2015.
3 Twelve months to 30 June 2015 derived from Tullett Prebon's published
results for the year ended 31 December 2014 and for the six month periods
ended 30 June 2015 and 30 June 2014, adjusted for the full year impact of PVM,
MOAB and Murphy & Durieu.
4 Trading operating profit fortwelve months to 30 September 2015, adjusted to
exclude indirect costs which will no longer be charged to IGBB following
Completion.
5 Twelve months to 30 June 2015 derived from Tullett Prebon's published
results for the year ended 31 December 2014 and for the six month periods
ended 30 June 2015 and 30 June 2014, adjusted for the full year impact of PVM
and MOAB.
6 Twelve months to 30 September 2015.
7 Twelve months to 30 June 2015 for Tullett Prebon and twelve months to 30
September 2015 for IGBB.
8 Fusion is an e-Commerce portal for trading venues, which acts as a
front-end service to distribute an increasing number of broker-assisted
matching sessions in products with more episodic liquidity.
This information is provided by RNS
The company news service from the London Stock ExchangeRecent news on TP Icap
See all newsREG - TP ICAP Group plc - Trading Statement
AnnouncementREG - TP ICAP Group plc - Director Declaration
AnnouncementREG - TP ICAP Group plc - Transaction in Own Shares
AnnouncementREG - TP ICAP Group plc - Transaction in Own Shares
AnnouncementREG - TP ICAP Group plc - Transaction in Own Shares
Announcement