REG - YouGov PLC - Preliminary Results <Origin Href="QuoteRef">YOU.L</Origin> - Part 2
29/10/2014 11:19
- Part 2: For the preceding part double click ID:nRSM0664Ua
1,039 1,490
Finance income 171 207
Finance costs (463) (89)
Share of post-tax loss in joint ventures and associates (14) (122)
Profit before taxation 1 733 1,486
Tax (charge)/ credit 3 (316) 623
Profit after taxation 1 417 2,109
Attributable to:
- Owners of the parent 433 2,042
- Non-controlling interests (16) 67
417 2,109
Earnings per share
Basic earnings per share attributable to owners of the parent 5 0.4p 2.1p
Diluted earnings per share attributable to owners of the parent 5 0.4p 2.0p
* Total 2014 operating expenses including amortisation of intangibles and the items detailed in Note 4 are £48.250m (2013:
£45.621m).
YOUGOV PLC
CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
For the year ended 31 July 2014
Note 2014 2013
£'000 £'000
Profit for the year 417 2,109
Other comprehensive (loss)/income:
Items that may be subsequently reclassified to profit or loss
Currency translation differences (4,774) 2,706
Other comprehensive (loss)/income for the year (4,774) 2,706
Total comprehensive (loss)/income for the year (4,357) 4,815
Attributable to:
- Owners of the parent (4,338) 4,743
- Non-controlling interests (19) 72
Total comprehensive (loss)/income for the year (4,357) 4,815
Items in the statement above are disclosed net of tax.
YOUGOV PLC
CONSOLIDATED STATEMENT OF FINANCIAL POSITION
As at 31 July 2014
Assets Note 31 July 31 July
2014 2013
£'000 £'000
Non-current assets
Goodwill 7 36,329 38,800
Other intangible assets 8 10,321 9,210
Property, plant and equipment 9 2,489 2,256
Investments in joint ventures and associates - 363
Deferred tax assets 3,120 2,847
Total non-current assets 52,259 53,476
Current assets
Trade and other receivables 10 21,687 22,951
Current tax assets 757 834
Cash and cash equivalents 7,429 6,929
Total current assets 29,873 30,714
Total assets 82,132 84,190
Liabilities
Current liabilities
Trade and other payables 11 17,530 16,235
Provisions for other liabilities and charges 3,127 2,737
Borrowings 184 273
Current tax liabilities 341 128
Contingent consideration 12 298 301
Total current liabilities 21,480 19,674
Net current assets 8,393 11,040
Non-current liabilities
Trade and other payables 23 55
Provisions for other liabilities and charges 684 770
Contingent consideration 12 169 250
Deferred tax liabilities 1,824 2,327
Total non-current liabilities 2,700 3,402
Total liabilities 24,180 23,076
Net assets 57,952 61,114
Equity
Issued share capital 199 195
Share premium 31,014 30,961
Merger reserve 9,239 9,239
Foreign exchange reserve 5,722 10,493
Retained earnings 11,755 10,195
Total shareholders' funds 57,929 61,083
Non-controlling interests in equity 23 31
Total equity 57,952 61,114
YOUGOV PLC
CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
For the year ended 31 July 2014
Attributable to equity holders of the Company
Note Share Share premium Merger reserve Foreign Retained earnings Total Non-controlling interest Total
capital £'000 £'000 exchange reserve £'000 £'000 £'000 £'000
£'000 £'000
Balance at 31 July 2012 195 30,947 9,239 7,792 7,776 55,949 55 56,004
Changes in equity for 2013
Exchange differences on translating foreign operations - - - 2,701 - 2,701 5 2,706
Net profit recognised directly in equity - - - 2,701 - 2,701 5 2,706
Profit for the year - - - - 2,042 2,042 67 2,109
Total comprehensive income for the year - - - 2,701 2,042 4,743 72 4,815
Issue of shares - 14 - - - 14 - 14
Dividends paid 4 - - - - (479) (479) (96) (575)
Share-based payments - - - - 856 856 - 856
Total transactions with owners recognised directly in equity - 14 - - 377 391 (96) 295
Balance at 31 July 2013 195 30,961 9,239 10,493 10,195 61,083 31 61,114
Changes in equity for 2014
Exchange differences on translating foreign operations - - - (4,771) - (4,771) (3) (4,774)
Net loss recognised directly in equity - - - (4,771) - (4,771) (3) (4,774)
Profit for the year - - - - 433 433 (16) 417
Total comprehensive (loss)/profit for the year - - - (4,771) 433 (4,338) (19) (4,357)
Issue of shares 4 53 - - - 57 - 57
Purchase of subsidiary with a minority interest 6 - - - - - - 11 11
Dividends paid 4 - - - - (586) (586) (35) (621)
Purchase of non-controlling interest in subsidiary 6 - - - - (35) (35) 35 -
Consideration for purchase of subsidiary 6 - - - - 700 700 - 700
Share-based payments - - - - 1,048 1,048 - 1,048
Total transactions with owners recognised directly in equity 4 53 - - 1,422 1,184 11 1,195
Balance at 31 July 2014 199 31,014 9,239 5,722 11,755 57,929 23 57,952
YOUGOV PLC
CONSOLIDATED STATEMENT OF CASH FLOWS
For the year ended 31 July 2014
Note 2014 2013
£'000 £'000
Cash flows from operating activities
Profit before taxation 733 1,486
Adjustments for:
Finance income (171) (207)
Finance costs 463 89
Share of post-tax loss in joint ventures and associates 14 122
Amortisation of intangibles 2 4,120 3,280
Depreciation 2 631 539
Loss on disposal of property, plant and equipment and other intangible assets - 3
Other non-cash profit items 1,334 866
Increase in trade and other receivables (1,088) (3,113)
Increase in trade and other payables 2,411 3,381
Increase in provisions 445 464
Cash generated from operations 8,892 6,910
Interest paid (4) (15)
Income taxes paid (287) (477)
Net cash generated from operating activities 8,601 6,418
Cash flow from investing activities
Loan to associate - (546)
Purchase of subsidiary (net of cash acquired) 9 (643) -
Acquisition of non-controlling interest in associates 13 (28) -
Settlement of contingent considerations 17 (332) (2,023)
Purchase of property, plant and equipment 12 (1,048) (411)
Purchase of intangible assets 11 (4,723) (3,638)
Proceeds from sale of plant, property and equipment 12 -
Interest received 1 34
Dividends received 55 41
Net cash used in investing activities (6,707) (6,543)
Cash flows from financing activities
Proceeds from the issue of share capital 57 14
Proceeds from borrowings - 57
Repayment of borrowings (32) (18)
Dividends paid to shareholders (586) (479)
Dividends paid to non-controlling interests (35) (96)
Net cash used in financing activities (596) (522)
Net increase/(decrease) in cash and cash equivalents 1,299 (647)
Cash and cash equivalents at beginning of year 6,656 7,150
Exchange (loss)/gain on cash and cash equivalents (710) 153
Cash and cash equivalents at end of year 15 7,245 6,656
YOUGOV PLC
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS
For the year ended 31 July 2014
Nature of operations
YouGov plc and subsidiaries' ("the Group") principal activity is the provision of market research.
YouGov plc is the Group's ultimate parent company. It is incorporated and domiciled in Great Britain. The address of YouGov
plc's registered office is 50 Featherstone Street, London EC1Y 8RT United Kingdom. YouGov plc's shares are listed on the
Alternative Investment Market of the London Stock Exchange.
YouGov plc's annual consolidated financial statements are presented in UK Sterling, which is also the functional currency
of the parent company.
Basis of preparation
The following financial information does not amount to full financial statements within the meaning of Section 434 of
Companies Act 2006. The financial information has been extracted from the Group's Annual Report and Financial Statements
for the year ended 31 July 2014 on which an unqualified report has been made by the Company's auditors.
The consolidated financial statements of YouGov plc have been prepared under the historical cost convention modified for
fair values under International Financial Reporting Standards as adopted by the European Union (IFRS). These consolidated
financial statements have been prepared in accordance with IFRS, IFRS Interpretations Committee (IFRS IC) and the Companies
Act 2006 applicable to companies reporting under IFRS.
Financial statements for the year ended 31 July 2013 have been delivered to the Registrar of Companies; the report of the
auditors on those accounts was unqualified and did not contain a statement under Section 498 of the Companies Act 2006. The
2014 statutory accounts will be delivered in due course.
Copies of the Annual Report and Financial Statements will be posted to shareholders shortly and will be available from the
Company's registered office at 50 Featherstone Street, London, EC1Y 8RT.
1 SEGMENTAL ANALYSIS
For internal reporting purposes the Group is organised into six operating divisions based on geographic lines - UK, Middle
East, Germany, Nordic, USA and France. These divisions are the primary basis on which the Group reports its segmental
information. The Group has three product lines - Custom Research, Data Products and Data Services. Supplementary segmental
information has been provided on this basis.
Management has determined the operating segments based on the reports reviewed by the Board of Directors (which is the
"chief operating decision-maker"). During the year ended 31 July 2014, the Board of Directors primarily reviewed
information based on geographic lines but also reviewed information based on product lines. For the year ending 31 July
2015, the Board will primarily review information based on product lines with supplemental geographical information. As a
result product lines will form the basis for the segmental analysis in future years.
2014 UK Middle Germany Nordic USA France Consolidation Group
£'000 East £'000 £'000 £'000 £'000 and unallocated £'000
£'000 £'000
Revenue
External sales 18,795 9,963 8,571 7,844 21,588 445 169 67,375
Inter-segment sales 564 163 374 141 270 311 (1,823) -
Total revenue 19,359 10,126 8,945 7,985 21,858 756 (1,654) 67,375
Inter-segment sales are priced on an arm's length basis that would be available to unrelated third parties.
Segment result
Gross profit 14,720 7,449 6,669 6,504 15,550 581 91 51,564
Adjusted operating profit 5,007 2,246 503 823 3,012 (121) (4,081) 7,389
Amortisation of intangibles 681 82 91 480 702 27 1,902 3,965
Exceptional costs 152 42 273 498 394 - 1,026 2,385
Finance income 171
Finance costs (463)
Share of results of joint ventures and associates (14)
Profit before taxation 733
Tax charge (316)
Profit after taxation 417
Other segment information
Depreciation 90 129 103 42 121 1 145 631
Share-based payments - - - - - - 547 547
Assets
Segment assets 31,064 7,741 15,234 12,130 32,882 1,094 (18,013) 82,132
Investments in associates -
Total assets 82,132
2013 UK Middle Germany Nordic USA France Consolidation Group
£'000 East £'000 £'000 £'000 £'000 and unallocated £'000
£'000 £'000
Revenue
External sales 17,055 7,252 9,051 8,438 20,619 136 - 62,551
Inter-segment sales 334 63 330 54 176 203 (1,160) -
Total revenue 17,389 7,315 9,381 8,492 20,795 339 (1,160) 62,551
Inter-segment sales are priced on an arm's length basis that would be available to unrelated third parties.
Segment result
Gross profit 12,777 5,532 7,493 6,720 14,210 267 112 47,111
Adjusted operating profit 4,437 1,547 880 345 2,274 (91) (3,410) 5,982
Amortisation of intangibles (469) (76) (136) (443) (640) (15) (1,501) (3,280)
Exceptional costs (70) - (27) (454) (342) - (319) (1,212)
Finance income 207
Finance costs (89)
Share of results of joint ventures and associates (122)
Profit before taxation 1,486
Tax credit 623
Profit after taxation 2,109
Other segment information
Depreciation 74 99 105 49 65 2 145 539
Share-based payments - - - - - - 767 767
Assets
Segment assets 29,992 7,847 16,898 13,392 32,788 470 (17,560) 83,827
Investments in associates 363
Total assets 84,190
Differences between the origin and destination of revenue are material to the Group. Revenue by destination is presented
below.
2014 UK Middle Germany Nordic USA France Consolidation Group
£'000 East £'000 £'000 £'000 £'000 and unallocated £'000
£'000 £'000
External sales 18,507 8,770 8,647 7,822 22,634 727 268 67,375
Inter-segment sales 1,071 131 334 247 1,302 41 (3,126) -
Total revenue 19,578 8,901 8,981 8,069 24,256 768 (2,858) 67,375
2013
External sales 17,683 6,071 9,080 8,441 21,036 240 - 62,551
Inter-segment sales 852 107 351 214 699 13 (2,236) -
Total revenue 18,535 6,178 9,431 8,655 21,735 253 (2,236) 62,551
Inter-segment sales are priced on an arm's-length basis that would be available to unrelated third parties.
Supplementary information by product line
2014 Custom Research Data Products Data services Unallocated Group
£'000 £'000 £'000 £'000 £'000
Revenue 47,689 9,604 10,082 - 67,375
Adjusted operating profit 5,485 1,639 3,947 (3,682) 7,389
2013
External sales 47,400 6,641 8,510 - 62,551
Adjusted operating profit 5,126 834 3,246 (3,224) 5,982
2 EXCEPTIONAL ITEMS
2014 2013
£'000 £'000
Restructuring costs 1,192 645
Acquisition related costs 1,226 255
Change in accounting estimation - contingent consideration 92 35
Cost of establishing new entities 44 -
Gain on re-measurement of associates on acquisition of control (169)
Employment termination - 205
Panel closure costs - 72
2,385 1,212
Restructuring costs in the year are the cost of reorganising the management structure of the Nordic £498,000, US £302,000,
German £284,000 and UK £108,000 businesses. Restructuring costs in the prior year primarily relate to the restructuring of
the Nordic business to improve performance and the cost of reorganising the UK and Group management structures.
Acquisition related costs in the year comprise:
£729,000 in relation to the acquisition of Doughty Media 2 including £699,000 in respect of contingent consideration that
is deemed under IFRS to be staff compensation costs and £30,000 of transaction costs.
£524,000 in relation to the acquisition of Decision Fuel including £286,000 of transaction costs, £163,000 of deemed staff
costs and £75,000 of loyalty bonuses
A credit of £27,000 in respect of prior year acquisition fees.
Acquisition related costs in the prior year include £102,000 of contingent consideration in respect of the Definitive
Insights acquisition that is deemed under IFRS3 to be staff compensation cost, £136,000 incurred in relation to a
prospective acquisition with which the Group decided not to proceed and £18,000 in respect of the acquisition of a
shareholding in Doughty Media 2.
The change in estimated contingent consideration in the year is in respect of the Definitive Insights acquisition. The
change in estimated contingent consideration in the prior year comprises a charge of £70,000 in respect of the acquisition
of Clear Horizons, a credit of £16,000 in respect of the Harrison Group acquisition and a credit of £19,000 in respect of
the Definitive Insights acquisition.
The cost of establishing new entities relate to the professional and regulatory fees incurred in establishing new
operations in Kurdistan, Egypt & Saudi Arabia & Indonesia.
The Group acquired an additional 27% equity interest in CoEditor on 6 September 2013. This additional equity interest
resulted in YouGov Plc acquiring control of CoEditor. Under International Financial Reporting Standard 3, 'Business
Combinations' ('IFRS 3'), the interest previously held by the Group has been re-measured to its fair value at the
acquisition date. This has resulted in a gain of £169,000 arising on the revaluation of our existing interest which has
been included in exceptional items in the income statement. IFRS 3 requires that the interest should be treated on the
same basis as would be required if the acquirer had disposed directly of the previously held interest and then required at
fair value. Prior to the acquisition the interest in CoEditor was proportionally consolidated as disclosed in the 31 July
2013 accounting policies note. The Group has shown the disposal of the previously held interest and re-acquisition within
note 9 of the financial statements.
Employment termination costs in the prior year relate to redundancies in the US. Panel closure costs in the prior year
arose as a result of closure of the YouGov panel in Chile.
3 INCOME TAXES
The taxation charge represents:
2014 2013
£'000 £'000
Current tax on profits for the year 458 294
Adjustments in respect of prior years 57 196
Total current tax charge 515 490
Deferred tax:
Origination and reversal of temporary differences (91) (89)
Adjustments in respect of prior years (117) (1,130)
Impact of changes in tax rates 9 106
Total deferred tax credit (199) (1,113)
Total income statement tax charge/(credit) 316 (623)
The tax assessed for the year is higher (2013: lower) than the standard rate of corporation tax in the UK. The differences
are explained below:
2014 2013
£'000 £'000
Profit before taxation 733 1,486
Tax charge calculated at Group's standard rate of 22.3% (2013: 23.7%) 164 352
Variance in overseas tax rates (37) (177)
Impact of changes in tax rates 9 106
Gains not subject to tax - (10)
Expenses not deductible for tax purposes 225 134
Tax losses for which no deferred income tax asset was recognised 12 (123)
Adjustment in respect of prior years (60) (934)
Associates results reported net of tax 3 29
Total income statement tax charge/(credit) for the year 316 (623)
On 2 July 2013, the UK corporation tax rate was reduced from 23% to 21% from 1 April 2014 and 20% from 1 April 2015. This
change has been substantively enacted at the balance sheet date and, therefore, is included in these financial statements.
As deferred tax assets and liabilities are measured at the rates that are expected to apply in the periods of the reversal,
deferred tax balances at 31 July 2014 have been calculated using a rate of 21% or 20%, as appropriate, giving rise to a
reduction in the net deferred tax asset of £9,000 (2013: £106,000).
4 DIVIDEND
On 16 December 2013, a final dividend in respect of the year ended 31 July 2013 of £586,000 (0.6p per share) (2012:
£479,000 (0.5p per share)) was paid to shareholders. A dividend in respect of the year ended 31 July 2014 of 0.8p per
share, amounting to a total dividend of £794,000 is to be proposed at the Annal General Meeting on 10 December 2014. These
financial statements do not reflect this proposed dividend payable.
5 EARNINGS PER SHARE
The calculation of the basic earnings per share is based on the earnings attributable to ordinary shareholders divided by
the weighted average number of shares in issue during the year. Shares held in employee share trusts are treated as
cancelled for the purposes of this calculation.
The calculation of diluted earnings per share is based on the basic earnings per share, adjusted to allow for the issue of
shares and the post-tax effect of dividends and/or interest, on the assumed conversion of all dilutive options and other
dilutive potential Ordinary Shares.
The adjusted earnings per share has been calculated to reflect the underlying profitability of the business by excluding
the amortisation of intangible assets, share-based payments, imputed interest, impairment charges, exceptional items and
any related tax effects.
2014 2013
£'000 £'000
Profit after taxation attributable to equity holders of the parent company 433 2,042
Add: amortisation of intangible assets 3,965 3,280
Add: share-based payments 547 767
Add: imputed interest 32 71
Add: exceptional costs 2,385 1,212
Tax effect of the above adjustments and exceptional tax items (1,335) (2,060)
Adjusted profit after taxation 6,027 5,312
Reconciliations of the earnings and weighted average number of shares used in the calculations are set out below.
2014 2013
Number of shares
Weighted average number of shares during the period: ('000 shares)
- Basic 98,044 95,639
- Dilutive effect of share options 5,434 7,535
- Diluted 103,478 103,174
The adjustments have the following effect:
Basic earnings per share 0.4p 2.1p
Amortisation of intangible assets 4.1p 3.4p
Share-based payments 0.6p 0.8p
Imputed interest 0.0p 0.1p
Exceptional costs and impairments 2.4p 1.3p
Tax effect of the above adjustments and exceptional tax items (1.4p) (2.1p)
Adjusted earnings per share 6.1p 5.6p
Diluted earnings per share 0.4p 2.0p
Amortisation of intangible assets 3.9p 3.2p
Share-based payments 0.5p 0.7p
Imputed interest 0.0p 0.0p
Exceptional costs and impairment 2.3p 1.2p
Tax effect of the above adjustments and exceptional tax items (1.3p) (2.0p)
Adjusted diluted earnings per share 5.8p 5.1p
6 BUSINESS COMBINATIONS AND DISPOSALS
a) Doughty Media 2 Limited ("DM2")
During the year, YouGov acquired 100% of DM2 which owned 68% of CoEditor Limited, the company which developed the Opigram
service and in which YouGov already owned a 30% shareholding. This acquisition was made in two stages: 40% was acquired in
September 2013 and the remaining 60% in December 2013.
i) Acquisition of 40% shareholding in DM2
On 6 September 2013, YouGov plc purchased a 40% shareholding in DM2 from Freddie Sayers, an Executive Director of CoEditor
Limited, for a purchase price of £497,000. £37,000 of this was paid in cash on completion, the remaining balance of
£460,000 will be payable in YouGov shares in February 2015 contingent on Freddie Sayers' continuing employment of which
£348,000 is also contingent on the achievement of certain performance criteria relating to the delivery of expected
benefits arising from the incorporation of the Opigram technology within YouGov's online presence.
DM2 has a 68% shareholding in CoEditor Limited ("CoEditor") and following this purchase, YouGov's effective interest in
CoEditor increased to 57% which constituted control.
The payment due in February 2015 has been discounted to a net present value of £456,000 resulting in a finance charge of
£4,000 to be taken to the income statement over the earn-out period. All of this deferred consideration is contingent upon
continuing employment and therefore will be treated as staff compensation under IFRS.
Professional fees of £30,000 were incurred during the year relating to the acquisition and in accordance with IFRS3
(revised) these professional fees have been expensed in the period in which they have been incurred.
The amounts recognised for each class of CoEditor's assets recognised at the acquisition date are as follows:
Fair value£'000
Intangible assets - software and software development 768
Property plant and equipment 15
Cash 12
Other working capital (60)
Deferred tax liability (62)
Net assets 673
Non-controlling interests (11)
Attributable to owners of the parent 662
Goodwill arising on acquisition 569
Total consideration 1,231
Total consideration analysed as:
Carrying value of investment in CoEditor 377
Re-measurement of the investment to in CoEditor to fair value 169
Fair value of existing investment in CoEditor 546
Settlement of existing loan 648
Cash 37
Total consideration 1,231
The gain of £169,000 on the re-measurement of the investment in CoEditor to fair value has been recognised in the Income
statement as an exceptional gain in the year.
The goodwill is attributable to the benefits expected, in terms of data collection, panel recruitment and retention and new
product opportunities, from the integration of the YouGov and Opigram websites.
Ownership and control passed to YouGov on 6 September 2013 and DM2 has been consolidated within the Group financial
statements from that date. Since the acquisition DM2 has not contributed to Group revenue and has reduced Group adjusted
operating profit by £232,000. If the acquisition had occurred on 1 August 2013 DM2 would have contributed £nil to Group
revenue and would have reduced Group operating profit by £250,000.
ii) Acquisition of 60% Shareholding in DM2
On 20 December 2013, YouGov plc purchased the remaining 60% shareholding in DM2 from Stephan Shakespeare, an Executive
Director of YouGov plc on the same terms and conditions agreed for the prior purchase of the 40% shareholding. The maximum
purchase price will be £744,000, payable in YouGov shares in February 2015 contingent on Stephan Shakespeare's continuing
employment, of which £521,000 is also contingent on the achievement of certain performance criteria relating to delivery of
expected benefits arising from the incorporation of the Opigram technology within YouGov's online presence
As a result of this transaction YouGov's effective interest in CoEditor increased to 97%.
The payment due in February 2015 has been discounted to a net present value of £739,000 resulting in a finance charge of
£5,000 to be taken to the income statement over the earn-out period. As this deferred consideration is contingent upon
continuing employment it will therefore be treated as staff compensation under IFRS.
As a result of this treatment consideration for this purchase was £nil and the book value of the non-controlling interest
at the transaction date was a deficit of £35,000. The difference of £35,000 has been reflected directly in reserves in
accordance with IAS27 (revised).
b) Acquisition of Decision Fuel
On 9 January 2014, YouGov plc purchased a 100% shareholding in Decision Fuel ("DF"), an Asian based research and technology
company with offices in Hong Kong, Shanghai and Singapore. The basic purchase consideration payable is the sum of six
times the EBITDA of DF in the year ending 31 July 2016 and two times EBITDA (capped at 1.5 times 2016 EBITDA) in the year
ending 31 July 2017 less any working capital funding provided by YouGov to DF prior to the end of the performance period.
An initial payment of $1,000,000 (£608,000) was paid upon completion and the balance will be paid in two instalments in
December 2017 and December 2018.
The payment due in 2017 and 2018 estimated to total $1.5m (£0.9m) approximately 97% of this deferred consideration is
contingent upon continuing employment and therefore will be treated as staff compensation under IFRS.
Professional fees of £286,000 and loyalty bonuses of £75,000 were incurred during the year relating to the acquisition and
in accordance with IFRS3 (revised) these costs have been expensed in the period in which they have been incurred.
The amounts recognised for each class of DFs' assets at the acquisition date are as follows:
Fair value£'000
Intangible assets - software and software development 250
Property plant and equipment 5
Cash (10)
Other working capital (258)
Deferred tax liability (9)
Net assets (22)
Goodwill arising on acquisition 657
Total consideration 635
Total consideration analysed as:
Deferred consideration 27
Cash 608
Total consideration 635
Ownership and control passed to YouGov on 8 January 2014 and DF has been consolidated within the Group financial statements
from that date. Since the acquisition DF has contributed £192,000 to Group revenue and has reduced Group adjusted
operating profit by £268,000. If the acquisition had occurred on 1 August 2013 DF would have contributed £290,000 to Group
revenue and would have reduced Group operating profit by £393,000.
7 GOODWILL
Middle USA Nordic Germany CoEditor£'000 Asia Pacific£'000 Total
East £'000 £'000 £'000 £'000
£'000
Carrying amount at 1 August 2012 1,405 16,814 7,825 10,195 - - 36,239
Exchange differences 44 523 857 1,137 - - 2,561
Carrying amount at 31 July 2013 1,449 17,337 8,682 11,332 - - 38,800
Additions through business combinations - - - - 569 657 1,226
Exchange differences (143) (1,713) (792) (1,031) - (18) (3,697)
Carrying amount at 31 July 2014 1,306 15,624 7,890 10,301 569 639 36,329
At 31 July 2014
Cost 1,306 15,624 7,890 12,585 569 639 38,613
Accumulated impairment - - - (2,284) - - (2,284)
Net book amount 1,306 15,624 7,890 10,301 569 639 36,329
In accordance with the Group's accounting policy, the carrying values of goodwill and other intangible assets are reviewed
annually for impairment. The cash-generating units (CGUs) are consistent with those segments shown in Note 1. The 2014
impairment review was undertaken as at 31 July 2014. The recoverable amounts of all CGUs have been determined based on
value in use calculations. This review assessed whether the carrying value of goodwill was supported by the net present
value of future cash flows derived from assets using a projection period of five years for each CGU, other than Germany,
based on approved budget numbers. For Germany, more conservative projections were used as a result of recent performance,
with approved budget numbers used for years one to three and EBITDA growth in years four and five assumed to be 5%.
Annual growth rates of 2.25% have been assumed in perpetuity beyond year five. The pre-tax weighted average costs of
capital used to discount the future cash flows to their present values are between10% and 17% (2013: between 10% and 17%).
The compound average revenue growth rates assumed for each CGU were Middle East (1%), USA 13%, Nordic 8%, Germany 7% and
Asia Pacific 111%.
8 OTHER INTANGIBLE ASSETS
Consumer Software and software development Customer Patents and trademarks Order Development Total
panel £'000 contracts £'000 backlog costs £'000
£'000 and lists £'000 £'000
£'000
At 1 August 2012
Cost 9,051 8,238 4,702 2,973 218 548 25,730
Accumulated amortisation (8,440) (5,225) (1,425) (1,555) (218) (323) (17,186)
Net book amount 611 3,013 3,277 1,418 - 225 8,544
Year ended 31 July 2013
Opening net book amount 611 3,013 3,277 1,418 - 225 8,544
Additions:
Separately acquired 649 852 - 11 - 247 1,759
Internally developed - 1,811 - - - 68 1,879
Amortisation charge:
Business combinations - - (479) (332) - - (811)
Separately acquired (422) (624) - (2) - (104) (1,152)
Internally developed - (1,300) - - - (17) (1,317)
Exchange differences 49 16 143 89 - 11 308
Closing net book amount 887 3,768 2,941 1,184 - 430 9,210
At 31 July 2013
Cost 10,142 10,983 4,963 3,197 232 900 30,417
Accumulated amortisation (9,255) (7,215) (2,022) (2,013) (232) (470) (21,207)
Net book amount 887 3,768 2,941 1,184 - 430 9,210
Year ended 31 July 2014
Opening net book amount 887 3,768 2,941 1,184 - 430 9,210
Additions:
Business combinations - 1,014 - - - - 1,014
Separately acquired 1,743 540 - 2 - 116 2,401
Internally developed - 2,315 - - - 7 2,322
Amortisation charge:
Business combinations - (169) (464) (324) - - (957)
Separately acquired (706) (696) - - - (172) (1,574)
Internally developed - (1,573) - - - (16) (1,589)
Exchange differences (85) (46) (271) (87) - (17) (506)
Closing net book amount 1,839 5,153 2,206 775 - 348 10,321
At 31 July 2014
Cost 10,917 14,106 4,485 2,907 210 969 33,594
Accumulated amortisation (9,078) (8,953) (2,279) (2,132) (210) (621) (23,273)
Net book amount 1,839 5,153 2,206 775 - 348 10,321
9 PROPERTY, PLANT AND EQUIPMENT
Freehold Leasehold Computer Fixtures Motor Total
property property equipment and vehicles £'000
£'000 improvements £'000 fittings £'000
£'000 £'000
At 1 August 2012
Cost 1,463 384 1,951 919 73 4,790
Accumulated depreciation (225) (309) (1,279) (603) (64) (2,480)
Net book amount 1,238 75 672 316 9 2,310
Year ended 31 July 2013
Opening net book amount 1,238 75 672 316 9 2,310
Additions:
Separately acquired - 2 328 66 15 411
Disposals - - (3) - - (3)
Depreciation (49) (17) (378) (89) (6) (539)
Exchange differences 37 4 17 18 1 77
Closing net book amount 1,226 64 636 311 19 2,256
At 31 July 2013
Cost 1,449 376 2,439 1,018 74 5,356
Accumulated depreciation (223) (312) (1,803) (707) (55) (3,100)
Net book amount 1,226 64 636 311 19 2,256
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