REG - Whitbread PLC - Whitbread Interim Results <Origin Href="QuoteRef">WTB.L</Origin> - Part 2
24/10/2017 07:05
- Part 2: For the preceding part double click ID:nRSX3908Ua
515.4
Tax expense (65.8) (62.9) (99.5)
Analysed as:
Underlying tax expense (66.1) (65.0) (119.1)
Non-underlying tax credit 3 0.3 2.1 19.6
Tax expense (65.8) (62.9) (99.5)
Profit for the period 250.2 200.7 415.9
Attributable to:
Parent shareholders 251.6 202.9 421.6
Non-controlling interest (1.4) (2.2) (5.7)
250.2 200.7 415.9
Earnings per share (Note 5) (Reviewed)6 months to 31 August 2017 pence (Reviewed)6 months to 1 September 2016pence (Audited)Year to 2 March 2017pence
Earnings per share
Basic 137.71 111.42 231.39
Diluted 137.26 111.06 230.89
Underlying earnings per share
Basic 143.74 133.88 246.48
Diluted 143.26 133.44 245.95
245.95
Interim consolidated statement of comprehensive income
Notes (Reviewed)6 months to 31 August 2017 £m (Reviewed)6 months to 1 September 2016£m (Audited)Year to 2 March 2017£m
Profit for the period 250.2 200.7 415.9
Items that will not be reclassified to the income statement:
Re-measurement gain / (loss) on defined benefit pension scheme 9 9.2 (152.5) (214.8)
Current tax on pensions 8.9 8.6 15.6
Deferred tax on pensions (9.7) 20.4 26.7
Deferred tax: change in rate of corporation tax on pensions (0.9) - (3.1)
7.5 (123.5) (175.6)
Items that may be reclassified subsequently to the income statement:
Net gain / (loss) on cash flow hedges 2.2 (1.5) (0.2)
Current tax on cash flow hedges (0.2) 0.5 0.5
Deferred tax on cash flow hedges (0.2) (0.2) (0.6)
Deferred tax: change in rate of corporation tax on cash flow hedges - - (0.1)
1.8 (1.2) (0.4)
Exchange differences on translation of foreign operations 8.4 13.8 22.9
Other comprehensive income / (loss) for the period, net of tax 17.7 (110.9) (153.1)
Total comprehensive income for the period, net of tax 267.9 89.8 262.8
Attributable to:
Parent shareholders 269.3 91.9 268.4
Non-controlling interest (1.4) (2.1) (5.6)
267.9 89.8 262.8
Interim consolidated statement of changes in equity
6 months to 31 August 2017 (Reviewed)
Share capital £m Share premium £m Capitalredemption reserve £m Retained earnings £m Currency translationreserve £m Other reserves £m Total £m Non-controlling interest £m Totalequity£m
At 2 March 2017 150.2 68.0 12.3 4,330.9 28.4 (2,061.5) 2,528.3 (3.5) 2,524.8
Profit for the period - - - 251.6 - - 251.6 (1.4) 250.2
Other comprehensive income - - - 7.1 8.4 2.2 17.7 - 17.7
Total comprehensive income - - - 258.7 8.4 2.2 269.3 (1.4) 267.9
Ordinary shares issued - 1.4 - - - - 1.4 - 1.4
Loss on ESOT shares issued - - - (1.7) - 1.7 - - -
Accrued share-based payments - - - 7.9 - - 7.9 - 7.9
Equity dividends - - - (120.3) - - (120.3) - (120.3)
At 31 August 2017 150.2 69.4 12.3 4,475.5 36.8 (2,057.6) 2,686.6 (4.9) 2,681.7
6 months to 1 September 2016 (Reviewed)
Share capital £m Share premium £m Capitalredemption reserve £m Retained earnings £m Currency translation reserve £m Other reserves £m Total £m Non-controlling interest £m Totalequity£m
At 3 March 2016 150.0 62.6 12.3 4,239.8 5.6 (2,067.7) 2,402.6 2.1 2,404.7
Profit for the period - - - 202.9 - - 202.9 (2.2) 200.7
Other comprehensive loss - - - (123.2) 13.7 (1.5) (111.0) 0.1 (110.9)
Total comprehensive income - - - 79.7 13.7 (1.5) 91.9 (2.1) 89.8
Ordinary shares issued 0.1 1.6 - - - - 1.7 - 1.7
Loss on ESOT shares issued - - - (5.6) - 5.6 - - -
Accrued share-based payments - - - 8.2 - - 8.2 - 8.2
Equity dividends - - - (112.6) - - (112.6) - (112.6)
At 1 September 2016 150.1 64.2 12.3 4,209.5 19.3 (2,063.6) 2,391.8 - 2,391.8
Year to 2 March 2017 (Audited)
Share capital £m Share premium £m Capitalredemption reserve £m Retained earnings £m Currency translation reserve £m Other reserves £m Total £m Non-controlling interest £m Totalequity£m
At 3 March 2016 150.0 62.6 12.3 4,239.8 5.6 (2,067.7) 2,402.6 2.1 2,404.7
Profit for the year - - - 421.6 - - 421.6 (5.7) 415.9
Other comprehensive loss - - - (175.8) 22.8 (0.2) (153.2) 0.1 (153.1)
Total comprehensive income - - - 245.8 22.8 (0.2) 268.4 (5.6) 262.8
Ordinary shares issued 0.2 5.4 - - - - 5.6 - 5.6
Loss on ESOT shares issued - - - (6.4) - 6.4 - - -
Accrued share-based payments - - - 17.7 - - 17.7 - 17.7
Tax on share-based payments - - - 0.4 - - 0.4 - 0.4
Tax rate change on historical revaluation - - - 0.7 - - 0.7 - 0.7
Equity dividends - - - (167.1) - - (167.1) - (167.1)
At 2 March 2017 150.2 68.0 12.3 4,330.9 28.4 (2,061.5) 2,528.3 (3.5) 2,524.8
Interim consolidated balance sheet
Notes (Reviewed)31 August 2017£m (Reviewed)1 September 2016£m (Audited)2 March 2017£m
ASSETS
Non-current assets
Intangible assets 282.2 263.2 275.7
Property, plant and equipment 4,040.0 3,970.9 3,972.4
Investment in joint ventures 51.7 50.2 53.0
Derivative financial instruments 8 35.9 31.6 43.3
Trade and other receivables 6.4 8.3 6.8
4,416.2 4,324.2 4,351.2
Current assets
Inventories 52.0 46.7 48.2
Derivative financial instruments 8 3.3 6.8 12.3
Trade and other receivables 221.0 147.9 163.6
Cash and cash equivalents 7 129.7 73.2 63.0
406.0 274.6 287.1
Assets held for sale 5.1 2.6 50.5
Total assets 4,827.3 4,601.4 4,688.8
LIABILITIES
Current liabilities
Borrowings 7 18.3 132.7 157.4
Provisions 38.9 12.9 36.3
Derivative financial instruments 8 2.6 1.1 2.3
Current tax liabilities 53.6 60.1 45.9
Trade and other payables 579.3 529.8 596.9
692.7 736.6 838.8
Non-current liabilities
Borrowings 7 963.8 928.7 795.6
Provisions 10.7 33.1 12.3
Derivative financial instruments 8 7.4 12.5 8.3
Deferred tax liabilities 72.6 73.4 62.0
Pension liability 9 374.5 403.5 425.1
Trade and other payables 23.9 21.8 21.9
1,452.9 1,473.0 1,325.2
Total liabilities 2,145.6 2,209.6 2,164.0
Net assets 2,681.7 2,391.8 2,524.8
EQUITY
Share capital 150.2 150.1 150.2
Share premium 69.4 64.2 68.0
Capital redemption reserve 12.3 12.3 12.3
Retained earnings 4,475.5 4,209.5 4,330.9
Currency translation reserve 36.8 19.3 28.4
Other reserves (2,057.6) (2,063.6) (2,061.5)
Equity attributable to equity holders of the parent 2,686.6 2,391.8 2,528.3
Non-controlling interest (4.9) - (3.5)
Total equity 2,681.7 2,391.8 2,524.8
Interim consolidated cash flow statement
Notes (Reviewed)6 months to 31 August 2017£m (Reviewed)6 months to 1 September 2016£m (Audited)Year to 2 March 2017 £m
Profit for the period 250.2 200.7 415.9
Adjustments for:
Tax expense 65.8 62.9 99.5
Net finance cost 4 20.0 18.1 37.3
Share of profit from joint ventures (0.8) (1.0) (3.2)
Share of profit from associate - (0.7) (0.7)
Non-underlying operating costs 3 6.4 38.0 39.7
Cash outflow from non-underlying operating costs - (2.8) (7.3)
Underlying depreciation and amortisation 2 112.8 104.2 217.6
Share-based payments 7.9 8.2 17.7
Other non-cash items 5.9 5.2 8.6
Cash generated from operations before working capital changes 468.2 432.8 825.1
Increase in inventories (3.7) (1.7) (3.1)
Increase in trade and other receivables (33.3) (7.1) (7.1)
Increase in trade and other payables 9.9 7.4 45.2
Cash generated from operations 441.1 431.4 860.1
Payments against provisions (14.1) (12.1) (22.3)
Pension payments 9 (48.1) (43.7) (90.3)
Interest paid (8.2) (9.7) (34.9)
Interest received 0.2 0.2 0.3
Corporation taxes paid (49.7) (35.9) (86.8)
Net cash flows from operating activities 321.2 330.2 626.1
Cash flows from investing activities
Purchase of property, plant and equipment 2 (252.0) (312.9) (571.2)
Investment in intangible assets 2 (16.8) (16.1) (38.6)
Proceeds from disposal of property, plant and equipment 41.3 53.6 192.9
Proceeds from disposal of investment in associate - - 14.1
Proceeds from disposal of business 44.9 - -
Capital contributions and loans to joint ventures - (7.6) (7.7)
Dividends from associate - 0.4 0.4
Net cash flows from investing activities (182.6) (282.6) (410.1)
Cash flows from financing activities
Proceeds from issue of share capital 1.4 1.7 5.6
(Reduction) / increase in short-term borrowings 7 (109.6) 4.5 17.6
Proceeds from long-term borrowings 7 200.0 - -
(Repayments of) / increases in long-term borrowings 7 (43.5) 73.9 (67.4)
Renegotiation costs of long-term borrowings 7 (0.8) (0.6) (0.6)
Dividends paid 6 (120.3) (112.6) (167.1)
Net cash flows from financing activities (72.8) (33.1) (211.9)
Net increase in cash and cash equivalents 65.8 14.5 4.1
Opening cash and cash equivalents 63.0 57.1 57.1
Foreign exchange differences 0.9 1.6 1.8
Closing cash and cash equivalents 7 129.7 73.2 63.0
Notes to the accounts
1. Basis of accounting and preparation
The interim condensed consolidated financial statements were authorised for
issue in accordance with a resolution of the Board of Directors on 23 October
2017.
The interim condensed consolidated financial statements are prepared in
accordance with UK listing rules and with IAS 34 'Interim Financial
Reporting'. The interim financial report does not constitute statutory
accounts within the meaning of section 434 of the Companies Act 2006.
The financial information for the year ended 2 March 2017 is extracted from
the statutory accounts of the Group for that year and does not constitute
statutory accounts as defined in Section 435 of the Companies Act 2006. These
published accounts were prepared in accordance with International Financial
Reporting Standards (IFRSs) as adopted for use in the European Union, and
reported on by the auditor without qualification or statement under Sections
498(2) or (3) of the Companies Act 2006 and have been delivered to the
Registrar of Companies.
The interim condensed consolidated financial statements for the six months
ended 31 August 2017 and the comparatives to 1 September 2016 are unaudited
but have been reviewed by the auditor; a copy of their review report is
included at the end of this report.
A combination of the strong cash flows generated by the business, and the
significant available headroom on its credit facilities, support the
directors' view that the Group has sufficient funds available for it to meet
its foreseeable working capital requirements. The directors have concluded
therefore that the going concern basis of preparation remains appropriate.
The accounting policies adopted in the preparation of the interim condensed
consolidated financial statements are consistent with those followed in the
preparation of the Group's annual financial statements for the year ended 2
March 2017.
2. Segmental analysis
For management purposes, the Group is organised into two strategic business
units (Premier Inn and Costa) based upon their different products and
services:
· Premier Inn provide services in relation to accommodation and food;
and
· Costa generates income from the operation of its branded, owned and
franchised coffee outlets.
The UK and International Premier Inn segments have been aggregated on the
grounds that the International segment is immaterial.
Management monitors the operating results of its strategic business units
separately for the purpose of making decisions about allocating resources and
assessing performance. Segment performance is measured based on underlying
operating profit. Included within the unallocated and elimination columns in
the tables below are the costs of running the public company. The unallocated
assets and liabilities are cash and debt balances (held and controlled by the
central treasury function), taxation, pensions, certain property, plant and
equipment, centrally held provisions and central working capital balances.
Inter-segment revenue is from Costa to the Premier Inn segment and is
eliminated on consolidation. Transactions were entered into on an arm's
length basis in a manner similar to transactions with third parties.
The following tables present revenue and profit information and certain asset
and liability information regarding business operating segments for the six
months to 31 August 2017 and 1 September 2016 and for the full year ended 2
March 2017.
Unallocated
and Total
Premier Inn Costa elimination Operations
6 months to 31 August 2017 £m £m £m £m
Revenue
Revenue from external customers 1,051.7 619.7 - 1,671.4
Inter-segment revenue - 2.0 (2.0) -
Total revenue 1,051.7 621.7 (2.0) 1,671.4
Underlying operating profit 295.6 64.8 (18.0) 342.4
Underlying net finance cost (Note 4) - - (14.8) (14.8)
Underlying profit before tax 295.6 64.8 (32.8) 327.6
Non-underlying items (Note 3):
Disposal of property, plant and equipment and property provisions (7.4) (0.6) - (8.0)
PI International business exit 6.7 - - 6.7
Historic indirect tax disputes - (4.0) - (4.0)
Amortisation of acquired intangibles - (1.1) - (1.1)
IAS 19 pension finance cost - - (5.2) (5.2)
Total non-underlying items (0.7) (5.7) (5.2) (11.6)
Profit before tax 294.9 59.1 (38.0) 316.0
Tax expense (65.8)
Profit for the period 250.2
Assets and liabilities
Segment assets 4,082.5 543.5 - 4,626.0
Unallocated assets - - 201.3 201.3
Total assets 4,082.5 543.5 201.3 4,827.3
Segment liabilities (403.7) (147.0) - (550.7)
Unallocated liabilities - - (1,594.9) (1,594.9)
Total liabilities (403.7) (147.0) (1,594.9) (2,145.6)
Net assets 3,678.8 396.5 (1,393.6) 2,681.7
Other segment information
Share of profit from joint ventures 0.5 0.3 - 0.8
Investment in joint ventures 39.5 12.2 - 51.7
Total property rent 73.8 61.9 - 135.7
Capital expenditure:
Property, plant and equipment - cash basis 199.5 52.5 - 252.0
Property, plant and equipment - accruals basis 160.7 46.7 - 207.4
Intangible assets 14.4 2.4 - 16.8
Depreciation - underlying (66.4) (37.1) - (103.5)
Amortisation - underlying (7.6) (1.7) - (9.3)
(9.3)
Unallocated
and Total
Premier Inn Costa elimination Operations
6 months to 1 September 2016 £m £m £m £m
Revenue
Revenue from external customers 988.1 567.8 - 1,555.9
Inter-segment revenue - 1.9 (1.9) -
Total revenue 988.1 569.7 (1.9) 1,555.9
Underlying operating profit 271.5 64.6 (16.4) 319.7
Underlying net finance cost (Note 4) - - (12.7) (12.7)
Underlying profit before tax 271.5 64.6 (29.1) 307.0
Non-underlying items (Note 3):
Disposal of property, plant and equipment and property provisions 6.3 (1.7) (0.7) 3.9
PI International business exit (35.0) - - (35.0)
UK restructuring (9.6) (1.1) - (10.7)
Historic indirect tax disputes - 5.0 - 5.0
Amortisation of acquired intangibles - (1.2) - (1.2)
IAS 19 pension finance cost - - (5.0) (5.0)
Unwinding of discount on provisions - (0.1) (0.3) (0.4)
Total non-underlying items (38.3) 0.9 (6.0) (43.4)
Profit before tax 233.2 65.5 (35.1) 263.6
Tax expense (62.9)
Profit for the period 200.7
Assets and liabilities
Segment assets 3,963.5 495.3 - 4,458.8
Unallocated assets - - 142.6 142.6
Total assets 3,963.5 495.3 142.6 4,601.4
Segment liabilities (367.9) (134.2) - (502.1)
Unallocated liabilities - - (1,707.5) (1,707.5)
Total liabilities (367.9) (134.2) (1,707.5) (2,209.6)
Net assets 3,595.6 361.1 (1,564.9) 2,391.8
Other segment information
Share of profit from joint ventures 0.7 0.3 - 1.0
Share of profit from associate 0.7 - - 0.7
Investment in joint ventures 39.0 11.2 - 50.2
Total property rent 68.7 58.2 - 126.9
Capital expenditure:
Property, plant and equipment - cash basis 257.6 55.3 - 312.9
Property, plant and equipment - accruals basis 227.5 57.4 - 284.9
Intangible assets 11.1 5.0 - 16.1
Depreciation - underlying (62.9) (34.2) - (97.1)
Amortisation - underlying (6.2) (0.9) - (7.1)
(7.1)
Unallocated
and Total
Premier Inn Costa elimination operations
Year to 2 March 2017 £m £m £m £m
Revenue
Revenue from external customers 1,907.9 1,198.1 - 3,106.0
Inter-segment revenue - 3.6 (3.6) -
Total revenue 1,907.9 1,201.7 (3.6) 3,106.0
Underlying operating profit 468.0 158.0 (33.6) 592.4
Underlying net finance cost (Note 4) - - (27.2) (27.2)
Underlying profit before tax 468.0 158.0 (60.8) 565.2
Non-underlying items (Note 3):
Disposal of property, plant and equipment and property provisions 23.1 (10.5) (0.8) 11.8
PI International business exit (30.0) - - (30.0)
Costa international restructuring - (14.5) - (14.5)
UK restructuring (15.6) (5.9) (0.1) (21.6)
Historic indirect tax disputes - 5.3 - 5.3
Net gain on disposal of investment in associate 11.8 - - 11.8
Amortisation of acquired intangibles - (2.5) - (2.5)
IAS 19 pension finance cost - - (9.4) (9.4)
Unwinding of discount on provisions - (0.2) (0.5) (0.7)
Total non-underlying items (10.7) (28.3) (10.8) (49.8)
Profit before tax 457.3 129.7 (71.6) 515.4
Tax expense (99.5)
Profit for the year 415.9
Assets and liabilities
Segment assets 4,020.2 511.4 - 4,531.6
Unallocated assets - - 157.2 157.2
Total assets 4,020.2 511.4 157.2 4,688.8
Segment liabilities (427.8) (163.3) - (591.1)
Unallocated liabilities - - (1,572.9) (1,572.9)
Total liabilities (427.8) (163.3) (1,572.9) (2,164.0)
Net assets 3,592.4 348.1 (1,415.7) 2,524.8
Other segment information
Share of profit from joint ventures 2.5 0.7 - 3.2
Share of profit from associate 0.7 - - 0.7
Investment in joint ventures 41.0 12.0 - 53.0
Total property rent 139.8 121.4 - 261.2
Capital expenditure:
Property, plant and equipment - cash basis 459.7 111.5 - 571.2
Property, plant and equipment - accruals basis 455.7 121.5 - 577.2
Intangible assets 25.8 12.8 - 38.6
Depreciation - underlying (131.0) (71.5) - (202.5)
Amortisation - underlying (13.3) (1.8) - (15.1)
(15.1)
3. Non-underlying items
6 months to31 August 2017£m 6 months to1 September 2016£m Year to 3 March 2017
£m
Non-underlying items are as follows:
Operating costs:
Disposal of property, plant and equipment and property provisions (a) (8.0) 3.9 11.8
PI International business exit (b) 6.7 (35.0) (30.0)
Costa international restructuring - - (14.5)
UK restructuring - (10.7) (21.6)
Historic indirect tax disputes (4.0) 5.0 5.3
Net gain on disposal of investment in associate - - 11.8
Amortisation of acquired intangibles
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