TIDMTNI
RNS Number : 1732G
Trinity Mirror PLC
02 March 2015
Trinity Mirror plc
2 March 2015
Annual Results Announcement
For the 52 weeks ended 28 December 2014
Key Highlights
-- Adjusted (1) profit before tax of GBP102.3 million, up 1.0%
Group revenue fell by 4.1% compared to a decline of 6.0% for
2013. Publishing digital revenue continued to grow by almost 50%
throughout the year. Tight management of the cost base with
structural cost savings of GBP15 million, GBP5 million ahead of
target, and a fall in interest costs, underpinned the growth in
adjusted profit before tax.
-- Adjusted (1) earnings per share growth of 2.5% to 32.8 pence
Increased adjusted profit before tax and a fall in the rate of
corporation tax led to increased adjusted earnings per share.
Statutory earnings per share increased from a loss of 39.0 pence to
earnings of 28.1 pence as 2013 was impacted by a GBP225.0 million
impairment charge.
-- Strong cash flows enabling net debt (2) to fall by GBP77.7 million to GBP19.3 million
Strong cash flow is after pre paying GBP17.0 million of pension
deficit funding payments from future periods and includes the
benefit of GBP16.0 million of dividends from associates. Since the
year end the Group has received special dividends totalling GBP12.0
million from Local World.
-- Board proposes a final dividend of 3 pence per ordinary
share, the first dividend since 2008
A final dividend for 2014 of 3 pence per ordinary share, payable
on 4 June 2015, is proposed for shareholder approval at the Annual
General Meeting to be held on 7 May 2015.
-- Continued strong growth in digital audience and revenue
Average monthly unique users (3) grew by 87% year on year to
73.2 million and average monthly page views (3) grew by 97% year on
year to 509.4 million across our publishing operations with
publishing digital revenue growing by almost 50%.
-- Civil claims arising from phone hacking
As the process of dealing with the civil claims arising from
phone hacking has progressed it has become evident that the cost of
resolving these claims will be higher than previously envisaged. As
previously announced we have charged a provision of GBP12.0 million
in 2014 for dealing with and resolving these claims. It remains
uncertain as to how these matters will progress.
-- Strategy unchanged and remains on track
Continued focus on digital investment and growth combined with
print market outperformance and tight management of the cost base
including further targeted structural cost savings of GBP10 million
in 2015. The Board expects performance for 2015 to be in line with
expectations.
Results Adjusted results (1) Statutory results
2014 2013 2014 2013
GBPm GBPm GBPm GBPm
Revenue 636.3 663.8 636.3 663.8
Operating profit/(loss) 105.5 108.0 98.6 (134.8)
Profit/(loss) before tax 102.3 101.3 81.6 (160.8)
Earnings/(loss) per share 32.8p 32.0p 28.1p (39.0)p
(1) Adjusted items relate to the exclusion of non-recurring
items (share of non-recurring credit from associate undertakings of
GBP27.2 million and provision for historical legal issues of
GBP12.0 million), restructuring charges in respect of cost
reduction measures, the amortisation of intangible assets, the
retranslation of foreign currency borrowings, the impact of fair
value changes on derivative financial instruments, the pension
finance charge, the pension administrative expenses and the impact
of tax legislation changes. Set out in note 16 is the
reconciliation between the statutory results and the adjusted
results.
(2) On a contracted basis assuming that the private placement
loan notes and related cross-currency interest rate swaps are not
terminated prior to maturity.
(3) Average monthly unique users and page views for the
Publishing division across web, mobile and apps for January to
December 2014 versus January to December 2013.
Commenting on the annual results for 2014, Simon Fox, Chief
Executive, Trinity Mirror plc, said:
"I am pleased with the financial and strategic progress we have
made in 2014. We continue to invest across the Group in people and
technology and this is delivering significant growth in digital
audience and revenue. Whilst print has remained challenging, our
continued focus on efficiency and cost management has resulted in
another year of profit growth and strong cash flow which has
enabled us to significantly reduce net debt and propose a final
dividend for 2014, the first since 2008. I am grateful to all our
colleagues for their contribution to this performance.
At the end of the year I implemented a new streamlined
management structure and I am confident that this will accelerate
our focus on delivering sustainable growth in revenue and profit.
The Board expects performance for 2015 to be in line with
expectations."
Enquiries
Trinity Mirror
Simon Fox, Chief Executive 020 7293 3553
Vijay Vaghela, Group Finance Director 020 7293 3553
Brunswick
Mike Smith, Partner 020 7404 5959
Jon Drage, Director 020 7404 5959
Investor presentation
A presentation for analysts will be held at 9.30am on Monday 2
March 2015. The presentation will be live on our website:
www.trinitymirror.com at 9.30am and a playback will be available
from 2.00pm.
Annual Report
The Annual Report for the 52 weeks ended 28 December 2014 is
available on the Company's website at www.trinitymirror.com and at
the Company's registered office at One Canada Square, Canary Wharf,
London E14 5AP and will be sent to shareholders who have elected to
receive a hard copy by the end of March 2015.
Statutory and adjusted basis
In the Management Report, performance is stated on an adjusted
basis to provide a more meaningful comparison of the Group's
performance. The adjusted results aim to provide an underlying
performance of the Group without the volatility created by
restructuring charges, non-recurring items and non-cash accounting
items. Set out in note 16 is the reconciliation between the
statutory results and the adjusted results. The results of fish4,
our national digital recruitment site, which were previously
reported in the Specialist Digital division, are now reported in
the Publishing division following an internal restructure with
fish4 now fully integrated into the Publishing division. Further
details of the reclassification, which has no impact on Group
revenue or operating profit, is shown in note 3.
Forward looking statements
Statements contained in this Annual Results Announcement are
based on the knowledge and information available to the Company's
directors at the date it was prepared and therefore the facts
stated and views expressed may change after that date. By their
nature, the statements concerning the risks and uncertainties
facing the Company in this Annual Results Announcement involve
uncertainty since future events and circumstances can cause results
and developments to differ materially from those anticipated. To
the extent that this Annual Results Announcement contains any
statement dealing with any time after the date of its preparation
such statement is merely predictive and speculative as it relates
to events and circumstances which are yet to occur. The Company
undertakes no obligation to update these forward-looking
statements.
Management Report
Operational Highlights
Key operational highlights during the year were:
-- The Daily Mirror continued to outperform the red top market
in terms of year on year circulation trends.
-- The Daily Record remains the leading news brand in Scotland
with a total audience of 3 million.
-- We successfully launched the Sunday Echo in Liverpool
expanding our market leading Liverpool Echo to a seven day
publication.
-- Continued enhancement of our digital products across the
portfolio and roll out of a new look national jobs site.
-- Increased focus on video saw the Mirror site exceeding 10
million video streams in a month.
-- Regional sites digital audience close to doubled following
the implementation of the Newsroom 3.1 initiative to put digital at
the heart of our news gathering operation.
-- Trinity Mirror Solutions (TMS), previously NASA, was unveiled
with a new structure and management to improve our offer to
advertisers.
-- Continued new business development including the launch of
PinPoint and a football betting app.
-- Senior appointments including James Wildman as Chief Revenue
Officer of TMS and Pete Picton as Editorial Director of
Mirror.co.uk.
Operational Performance
The Group performed robustly in 2014 with good progress made on
our strategic initiatives enabling us to deliver solid profits and
cash flow from print and strong growth in digital audience and
revenue.
Revenue fell by 4.1% compared to a decline of 6.0% for 2013.
Revenue trends improved as we progressed through the first half
with a more challenging market impacting performance in the second
half. Print advertising revenue fell by 14.1% in the second half
compared to a decline of 8.8% in the first half. For the Publishing
division, revenue fell by 4.2% to GBP554.0 million with print
revenue falling by 6.3% to GBP521.6 million and digital revenue
growing by 47.3% to GBP32.4 million. A key driver of the slowdown
in print revenue has been retail advertising, in particular
supermarket spend.
Operating costs fell by GBP25.7 million reflecting the benefit
of structural cost savings of GBP15 million, GBP5 million ahead of
target, and ongoing cost mitigation actions which have more than
offset increased investment in digital of GBP8 million and
inflationary cost increases, in particular newsprint prices which
increased by some 5% year on year.
Our share of results of associates fell by GBP0.7 million to
GBP6.1 million with growth in PA Group ('the PA') and Local World
offset by the disposal of MeteoGroup by the PA in March 2014. A
dividend of GBP12.9 million from the PA was received in July 2014.
Local World paid its first dividend with GBP3.1 million received in
August 2014 and since the year end we have received further special
dividends totalling GBP12.0 million. The Group has now received
dividends in excess of the GBP14.2 million invested in Local
World.
The fall in operating costs limited the reduction in operating
profit to GBP2.5 million or 2.3%. Earnings per share grew by 2.5%
to 32.8 pence as the Group benefited from lower interest costs on
reduced debt levels and from a fall in the rate of corporation
tax.
The Group incurred GBP14.0 million of restructuring charges in
respect of cost reduction measures and reported a net non-recurring
credit of GBP15.2 million including a GBP27.5 million share of the
non-recurring gain from the PA's disposal of MeteoGroup and a
provision of GBP12.0 million for dealing with and resolving civil
claims in relation to phone hacking.
Financial Flexibility
Net debt fell by GBP77.7 million to GBP19.3 million. Following
the repayment from cash flows of GBP44.2 million of maturing loan
notes in June 2014, the final remaining debt payment of GBP68.3
million is due in June 2017. In July 2014, the Group negotiated a
new GBP60 million bank facility which is committed until July 2018.
Cash balances at the reporting date were GBP49.0 million.
The Group has aligned the triennial valuations of the principal
defined benefit pension schemes to 31 December 2013. These
valuations were finalised in December 2014 with annual deficit
funding payments agreed at GBP36.2 million per annum for 2015, 2016
and 2017. Given the strong cash flows generated by the business,
the Group pre paid GBP17.0 million of contributions due in 2015 and
2016. Therefore, contributions due in 2015, 2016 and 2017 will be
GBP19.7 million, GBP35.7 million and GBP36.2 million respectively
with annual contributions thereafter of some GBP36 million per
annum. The pre payment of pension contributions is an efficient use
of cash as interest rates on cash balances are low and the tax
relief on the pre payment will crystallise by April 2015.
The strengthened balance sheet and strong cash flows of the
business provides increased financial flexibility for both
investment opportunities and the return of capital to shareholders
alongside appropriately funding our pension schemes.
Historical Legal Issues
The Group continues to co-operate with the Metropolitan Police
Service in respect of Operation Elveden (the investigation relating
to alleged inappropriate payments to public officials) and
Operation Golding (the investigation into alleged phone
hacking).
In July 2014, after our ongoing investigations revealed that
phone hacking had taken place at the Group, a provision of GBP4.0
million was made to cover the cost of dealing with and resolving
civil claims from individuals in relation to phone hacking. In the
second half of the year a number of claims have been settled and a
subsidiary, MGN Limited, has admitted liability to a number of
individuals who had sued the company for alleged interception of
their voicemails many years ago. As we progressed with dealing with
the civil claims it has become evident that the cost of resolving
these claims will be higher than previously envisaged. The
provision of GBP4.0 million made at the half year for dealing with
and resolving these claims has increased by a further GBP8.0
million. Inevitably, there remains ongoing uncertainty as to how
matters will progress and whether or not new allegations or claims
will emerge and their possible financial impact. Due to this
uncertainty a contingent liability has been highlighted in note
17.
The intrusion into peoples' lives through the unlawful practice
of phone hacking is unacceptable. We apologise to the victims of
phone hacking and published an open apology in our three national
newspapers in February 2015.
Press regulation
The Group, along with the vast majority of national and regional
newspaper and magazine publishers, has entered into a contract to
be regulated by the Independent Press Standards Organisation
("IPSO").
We recognise that the reputation of the British press has been
severely damaged by the findings of the Leveson Inquiry and we
welcome the new regime and high regulatory standards that will be
required under IPSO.
Following an independent process, IPSO has appointed its first
Chairman, Sir Alan Moses, and its first Board. IPSO became fully
operational from September 2014.
Dividends
The Board is proposing a final dividend for 2014 of 3 pence per
ordinary share which, subject to shareholder approval, will be paid
on 4 June 2015 to shareholders on the register on 8 May 2015. The
Board expects to adopt a progressive dividend policy aligned to the
free cash generation of the Group and the investment required to
deliver sustainable growth in revenues and profits. At this stage
the Board expects to pay dividends of some 5 pence per ordinary
share in 2015. The final dividend for 2014 will be the first
dividend since the suspension of dividends in 2008.
Outlook
The revenue trends in 2015 will be adversely impacted by the
closure of a number of regional titles in the South in December
2014 and a change to the newsprint supply agreement for the
Independent and i from January 2015. The titles closures
contributed GBP4.5 million of revenue in 2014. The supply of
newsprint to the Independent and i generated revenues and costs of
GBP11.1 million in 2014 with no impact on profit.
In the first 2 months of the year digital audience and revenue
growth has remained strong with our digital audience hitting 100
million unique users for the first time in January 2015. Print
circulation volume and advertising trends have continued at the
level experienced at the end of 2014. Circulation revenue has been
impacted by the decision not to increase the cover price of the
Daily Mirror.
A continued focus on costs, with further targeted structural
savings of GBP10 million in 2015, combined with the benefit of
lower newsprint prices and ongoing progress with our strategy,
provides the Board with confidence that performance for the current
year will be in line with expectations.
Strategic Update
We continue to make progress towards delivering our vision "of
being a dynamic and growing media business that is an essential
part of our customers' daily lives". Our clear goal to deliver
sustainable growth in revenues and profits will be delivered
through four key areas of strategic focus:
-- Protecting and revitalising our core brands in print;
-- Growing our existing brands onto digital delivery channels;
-- Continuing our relentless focus on efficiency and cost management; and
-- Launching, developing, investing in or acquiring new
businesses built around distinctive content or audience.
The strategy remains unchanged with focus on digital investment
and growth combined with print market outperformance and tight
management of the cost base.
Key highlights of progress on each area of strategic focus in
the year were:
Protecting and revitalising our core brands in print
-- The Daily Mirror has continued to outperform the red top
market in terms of year on year circulation trends in 2014. During
the year we launched the second phase of our #Madeuthink brand
campaign, positioning the Daily Mirror as the "intelligent tabloid"
to differentiate the Daily Mirror from other titles in the red top
market. The recent National Readership Survey Print and Digital
Data figures show the Daily Mirror's combined print and digital
monthly audience at 17 million, second only to the Daily Mail with
23 million. The same data shows the Daily Record remains the
leading news brand in Scotland with a total audience of 3
million.
-- Trinity Mirror Solutions was unveiled as the new name and
brand identity of our national advertising commercial business. A
new structure, including three new senior roles, has been
implemented to better combine the potential of TMS's brands and
audiences for the benefit of advertisers. We invested in a 25
strong cross media sales innovation unit combining the skills of
our sales team with that of business planners, researchers,
designers and writers to create and sell innovative cross media
advertising solutions for growing numbers of new and existing
clients.
-- The Daily Mirror and Sunday Mirror have increased print
advertising market share with one of the major contributory factors
being the success of new packages such as "Big City" and "Sunday
Best" which combine the full scale and reach of the Trinity Mirror
portfolio by combining the sales of our major regional newspapers
with our national brands to provide media planners and buyers with
a brand new mass market audience proposition. We re-launched and
rebranded the Sunday People magazine to become "Love Sunday" with
positive feedback from both readers and advertisers. In Scotland,
the Sunday Mail won Newspaper of the Year in the Scottish Press
Awards.
-- As the best watched TV awards show on UK terrestrial TV, the
annual "Pride of Britain Awards" continues to go from strength to
strength. During the year we continued to expand our 'Pride of
....' series launching the "Pride of Ireland Awards" and the "Pride
of Birmingham Awards". In Scotland, the Daily Record held its
eleventh "Our Heroes" awards.
-- In our regional markets we continue to adapt and refresh our
newspapers to ensure they are increasingly relevant and appealing
to our readers and advertisers. Our group wide technology platform
gives us the capability to add new products on multiple platforms
with a minimal increase in costs or resource. One such example is
the successful launch of the Sunday Echo in Liverpool which has
allowed us to increase our audience on a Sunday both in print and
online through the provision of more comprehensive football
content. All of our major regional daily newspapers are now
distributed through the wholesale infrastructure with resulting
cost and logistical benefits.
-- We continue to challenge the appropriateness of the regional
newspaper portfolio and this has led to a rationalisation of our
newspaper titles in the South with the closure of seven newspapers
at the end of the year.
Growing our existing brands onto digital delivery channels
-- A new editorial structure, Newsroom 3.1, has been implemented
in the regional newsrooms to support a digital first publishing
process providing content for our rapidly growing digital audience,
whilst at the same time producing strong newspapers. The
implementation of Newsroom 3.1 which put digital news gathering and
audience analytics at the heart of our regional newsrooms has led
to a near doubling of our regional digital audiences. This
structure, combined with a focus on mobile, social, data journalism
and community engagement has put us ahead of other regional news
brands. Our national news brands also underwent newsroom
reorganisations to better serve growing multi-platform
audience.
-- The strong growth in total unique users and page views has
continued during the year. Our average monthly unique users and
average monthly page views for the Publishing division across web,
mobile and apps for the year have grown year on year by 87% to 73.2
million and by 97% to 509.4 million respectively. In December,
monthly unique users were 81.7 million and monthly page views were
570.7 million. This has driven strong growth in digital display
advertising all year with growth of 101.4%. We continue to refresh
our websites to increase user engagement whilst ensuring we can
drive revenues through a range of advertising formats.
-- We have enhanced the digital classified platforms across our
regional websites and have rolled out our new platforms for
recruitment, What's On, Buysell and BMDs. Fish4Jobs, our leading
recruitment portal, has unveiled a new look national job site with
responsive web design and a fresh, new brand identity.
-- We are investing to increase the quality and volume of video
across our websites. The commercial opportunities are significant
as video commands the highest revenue per thousand views on our
websites. The Mirror site exceeded 10 million video streams in a
month at the end of the year, up from 3 million at the start of the
year.
-- Our Data Journalism Unit made good progress during the year
and the data journalism site Ampp3d continues to grow. The team
issued the 'NHS S.O.S' 16 page pullout investigation into the
future of the NHS, produced in collaboration with Sunday Mirror
journalists, built a First World War search tool enabling users to
look up relatives who were killed in the 1914-18 conflict and
produced the second 'Real School Guides' which was published across
our regional titles.
-- We continue to drive new commercial partnerships to diversify
and drive digital revenues and have entered into a new partnership
for the provision of bingo and other online games. We launched the
Mirror and Record's new bingo and casino platforms in July. Mirror
Matches our new dating site, went live in August.
-- We continue to gain good traction with the e-edition for the
Daily Mirror and Sunday Mirror. Our free Monday to Friday editions
of the Daily Mirror had in excess of 56,000 Publication Active
Views in December and the Daily Mirror and Sunday Mirror are
available through subscription over the weekend with over 11,000
paid for subscribers.
Continuing our relentless focus on efficiency and cost
management
-- Operating costs fell by GBP25.7 million reflecting the
benefit of structural cost savings of GBP15 million and ongoing
cost mitigation actions which have more than offset increased
investment in digital of GBP8 million and inflationary cost
increases, in particular newsprint prices which increased by some
5% year on year. Further structural cost savings of GBP10 million
are targeted in 2015.
-- Savings in the year have been driven through the outsourcing
of IT support and services functions, the restructure of editorial
and advertising functions, the streamlining of the senior
management team and a range of other smaller initiatives across the
Group.
Launching, developing, investing in or acquiring new businesses
built around distinctive content or audience
-- Our investment in Local World continues to deliver strong
returns with our share of post tax profit for the year up GBP0.1
million to GBP5.2 million.
-- Our product development team continues to launch new and
innovative products. Pinpoint, a mobile geo-targeting product for
advertisers and a new version of Mirror Football with integrated,
content-driven betting (in partnership with Paddy Power) were both
launched during the year. A digital content syndication licensing
tool and a public notices application are both in development and
due for release in 2015.
-- GoalTime, an all new live football betting pool game, was
developed and floated as Contagious Sports Inc on the Toronto Stock
Exchange. Our investment was converted into equity of the listed
entity and we hold 2.2 million shares (valued at GBP0.7 million at
the reporting date). UsVsTh3m has now been integrated into
Mirror.co.uk.
-- The new technology platform that we have rolled out across
the business provides significant flexibility for the launch,
development or integration of acquisitions built around distinctive
content or audience.
Management changes
We have made a number of significant appointments during the
year including James Wildman as Chief Revenue Officer of Trinity
Mirror Solutions and Pete Picton as Editorial Director for
Mirror.co.uk. James joined us from his position as Yahoo MD for UK
and Ireland and brings with him a wealth of experience in sales and
marketing in a global digital business. Pete is an experienced
digital journalist and was the former deputy editor of Mail
Online.
We have welcomed, amongst others, Rachel Stock as Group HR
Director, Andy Atkinson to the role of Trinity Mirror Solutions
Sales Director; Piers North as Trinity Mirror Solutions Strategy
Director; Oliver Gerrish as Head of Digital Analytics; Bob Cuff as
Managing Director of Teesside; Stuart Birkett as Managing Director
of the North East and Will Handley has been appointed Marketing
Director within Trinity Mirror's New Business Division.
These appointments evidence the progress in developing Trinity
Mirror as an employer of choice for digital and commercial
talent.
We have also streamlined the senior management structure with
Steve Anderson-Dixon appointed as Managing Director, Trinity Mirror
Regionals, Allan Rennie as Managing Director, Media Scotland, Neil
Jagger as General Manager, UK Nationals and Lloyd Embley as Group
Editor in Chief.
Group Review
Statutory results Adjusted results
2014 2013 2014 2013
GBPm GBPm GBPm GBPm
------------------------------- --------------------- -------------------- --------------- ------------
Revenue
Publishing* 554.0 578.4 554.0 578.4
Print 521.6 556.4 521.6 556.4
Digital* 32.4 22.0 32.4 22.0
------------------------------------- --------------- -------------------- --------------- ------------
Printing 64.5 65.7 64.5 65.7
Specialist Digital* 14.5 16.7 14.5 16.7
Central 3.3 3.0 3.3 3.0
------------------------------------- --------------- -------------------- --------------- ------------
Revenue 636.3 663.8 636.3 663.8
Costs (568.3) (801.9) (536.9) (562.6)
Associates 30.6 3.3 6.1 6.8
------------------------------- --------------------- -------------------- --------------- ------------
Operating profit(/loss) 98.6 (134.8) 105.5 108.0
Financing (17.0) (26.0) (3.2) (6.7)
------------------------------- --------------------- -------------------- --------------- ------------
Profit/(loss) before tax 81.6 (160.8) 102.3 101.3
Tax (charge)/credit (11.8) 64.4 (21.0) (22.2)
------------------------------- --------------------- -------------------- --------------- ------------
Profit/(loss) after tax 69.8 (96.4) 81.3 79.1
------------------------------- --------------------- -------------------- --------------- ------------
Earnings/(loss) per share 28.1p (39.0)p 32.8p 32.0p
------------------------------- --------------------- -------------------- --------------- ------------
* Following a change in management structure, the Group has
reclassified the revenue and results of fish4 from the Specialist
Digital operating segment to the Publishing operating segment. The
revision to the operating segments has had no impact on the revenue
or operating profit of the Group. The 2013 comparatives have been
restated as a result of this change. Note 3 sets out the impact of
this change on the previously reported results.
The results have been prepared for the 52 weeks ended 28
December 2014 (2014) and the comparative period has been prepared
for the 52 weeks ended 29 December 2013 (2013). The results are
presented on a statutory and adjusted basis to provide a more
meaningful comparison of the Group's performance. Set out in note
16 is the reconciliation between the statutory results and the
adjusted results.
Revenue fell by GBP27.5 million or 4.1% to GBP636.3 million
compared to a decline of 6.0% for 2013. The revenue trends improved
as we progressed through the first half with a weaker performance
in the second half. Print advertising revenue fell in the second
half by 14.1% compared to a decline of 8.8% in the first half.
Further details on the revenue trends for each division are shown
in the Divisional Review.
Statutory costs include non-recurring items, the amortisation of
other intangible assets, the pension administrative expenses and
the restructuring charges in respect of cost reduction measures
which are excluded from the adjusted results.
Statutory results Adjusted results
2014 2013 2014 2013
GBPm GBPm GBPm GBPm
----------------------------------- --------------- ----------------- ------------------- ----------------------
Labour (196.1) (210.0) (196.1) (210.0)
Newsprint (97.5) (102.3) (97.5) (102.3)
Depreciation (24.5) (26.4) (24.5) (26.4)
Other (250.2) (463.2) (218.8) (223.9)
--------------- ----------------- ------------------- ----------------------
Non-recurring items (12.0) (224.4) - -
Amortisation of other intangible
assets (2.2) (2.2) - -
Pension administrative expenses (3.2) (2.8) - -
Restructuring charges in respect
of cost reduction measures (14.0) (9.9) - -
Other (218.8) (223.9) (218.8) (223.9)
----------------------------------- --------------- ----------------- ------------------- ----------------------
Costs (568.3) (801.9) (536.9) (562.6)
----------------------------------- --------------- ----------------- ------------------- ----------------------
Statutory costs fell by GBP233.6 million or 29.1% to GBP568.3
million. The fall primarily reflects the impact of the significant
GBP225.0 million impairment of goodwill and other intangible assets
taken in the prior year.
Adjusted operating costs fell by GBP25.7 million reflecting the
benefit of structural cost savings of GBP15 million and ongoing
cost mitigation actions which have more than offset increased
investment in digital of GBP8 million and inflationary price
increases, in particular newsprint prices which increased by some
5% year on year.
The Group has a 21.5% investment in PA Group and a 20.0%
investment in Local World, accounted for as associated
undertakings.
Statutory results Adjusted results
2014 2013 2014 2013
GBPm GBPm GBPm GBPm
---------------------------------- ----------------- ------------ --------------- ------------
Result before amortisation and
non-recurring items 6.1 6.8 6.1 6.8
Amortisation of other intangible
assets (2.7) (3.0) - -
Non-recurring items 27.2 (0.5) - -
----------------------------------
Share of results of associates 30.6 3.3 6.1 6.8
---------------------------------- ----------------- ------------ --------------- ------------
The statutory share of the post tax profits from associates
increased by GBP27.3 million to GBP30.6 million. The non-recurring
items comprise our GBP27.5 million share of the gain on the
disposal by the PA of its weather forecasting business, MeteoGroup,
our GBP0.4 million share of the profit of MeteoGroup recorded by
the PA up to the date of completion less our GBP0.7 million share
of restructuring costs incurred by the PA and Local World. Adjusted
share of post tax profit from associates fell by GBP0.7 million to
GBP6.1 million. This includes a reduction in the contribution from
the PA of GBP0.8 million to GBP0.9 million following its disposal
of MeteoGroup which has been partially offset by an increase in our
share of post tax profit of Local World of GBP0.1 million to GBP5.2
million.
Statutory operating profit increased by GBP233.4 million to
GBP98.6 million primarily reflecting the significant impairment of
goodwill and other intangible assets taken in the prior year and
our share of the exceptional gain by the PA on their disposal of
MeteoGroup in the current year. Adjusted operating profit fell by
GBP2.5 million or 2.3% to GBP105.5 million with operating margin
pre associates improving by 0.4 percentage points from 15.2% to
15.6%.
Statutory results Adjusted results
2014 2013 2014 2013
GBPm GBPm GBPm GBPm
----------------------------------------- ------------- ------------ --------------- ---------------
Investment revenues 0.3 0.3 0.3 0.3
Pension finance charge (11.2) (13.2) - -
Finance costs (6.1) (13.1) (3.5) (7.0)
Interest on bank overdrafts and
borrowings (3.5) (7.0) (3.5) (7.0)
Fair value loss on derivative financial
instruments (0.3) (8.8) - -
Foreign exchange (loss)/gain on
retranslation of borrowings (2.3) 2.7 - -
----------------------------------------- ------------- ------------ --------------- ---------------
Financing (17.0) (26.0) (3.2) (6.7)
----------------------------------------- ------------- ------------ --------------- ---------------
Statutory financing costs which include the pension finance
charge, the change in derivative financial instruments and the
foreign exchange changes on retranslation of foreign currency
borrowings fell by GBP9.0 million to GBP17.0 million. Adjusted
financing costs fell by GBP3.5 million to GBP3.2 million reflecting
the benefit of the material fall in long term debt and the
continued benefit of the low interest rate environment.
The statutory tax charge of GBP11.8 million (2013: credit of
GBP64.4 million) comprises a current tax charge of GBP13.8 million
(2013: GBP18.1 million) and a deferred tax credit of GBP2.0 million
(2013: GBP82.5 million). The effective tax rate is lower than the
standard rate of corporation tax as the share of results of
associates is post tax. The adjusted tax charge of GBP21.0 million
(2013: GBP22.2 million) represents 20.5% (2013: 21.9%) of adjusted
profit before tax and reflects the benefit of the reduction in the
rate of corporation tax from 23.0% to 21.0% on 1 April 2014.
Statutory results Adjusted results
2014 2013 2014 2013
GBPm GBPm GBPm GBPm
----------------------------------- ----------------- ----------------- ---------------- ----------------
Profit/(loss) after tax 69.8 (96.4) 81.3 79.1
----------------- ----------------- ---------------- ----------------
Weighted average number of shares
(000's) 248,108 247,328 248,108 247,328
----------------------------------- ----------------- ----------------- ---------------- ----------------
Earnings/(loss) per share 28.1p (39.0)p 32.8p 32.0p
----------------------------------- ----------------- ----------------- ---------------- ----------------
Statutory earnings per share increased by 67.1 pence or 172.1%
to 28.1 pence and adjusted earnings per share increased by 0.8
pence or 2.5% to 32.8 pence. The increase in the weighted average
number of shares year on year reflects the impact of the 3,408,484
share options exercised during the year and the 1,652,091 share
options exercised during the prior year partially offset by the
1,391,620 of shares acquired by the Trustees of the Trinity Mirror
Employee Benefit Trust in the year and the 2,600,000 shares
acquired in the prior year.
Divisional Review
The Group has four operating segments, each of which is a
division, that are regularly reviewed for the purposes of
allocating resources and assessing performance. The divisional
review that follows is presented on an adjusted basis and there is
no difference between the operating profit by division and the
segment result of each operating segment that is shown in note
3.
The operating segments are: Publishing which includes all of our
newspapers and associated digital publishing; Printing which
provides printing services to the publishing segment and to third
parties; Specialist Digital which includes our acquired digital
recruitment classified business and our digital marketing services
businesses; and Central which includes revenue and costs not
allocated to the operational divisions and our share of results of
associates.
The revenue and adjusted operating profit by operating segment
is presented below:
2014 2013 Variance Variance
GBPm GBPm GBPm %
--------------------------- ------- ------- --------- ---------
Publishing* 554.0 578.4 (24.4) (4.2)
Printing 64.5 65.7 (1.2) (1.8)
Specialist Digital* 14.5 16.7 (2.2) (13.2)
Central 3.3 3.0 0.3 10.0
Revenue 636.3 663.8 (27.5) (4.1)
--------------------------- ------- ------- --------- ---------
Publishing* 113.5 118.5 (5.0) (4.2)
Printing - - - -
Specialist Digital* 2.0 0.4 1.6 400.0
Central (10.0) (10.9) 0.9 8.3
Adjusted Operating profit 105.5 108.0 (2.5) (2.3)
--------------------------- ------- ------- --------- ---------
* Following a change in management structure, the Group has
reclassified the revenue and results of fish4 from the Specialist
Digital operating segment to the Publishing operating segment. The
revision to the operating segments has had no impact on the revenue
or operating profit of the Group. The 2013 comparatives have been
restated as a result of this change. Note 3 sets out the impact of
this change on the previously reported results.
Publishing
The revenue and operating profit for the Publishing division is
as follows:
2014 2013 Variance Variance
GBPm GBPm GBPm %
------------------- -------- -------- --------- ---------
Print 521.6 556.4 (34.8) (6.3)
Circulation 279.8 285.8 (6.0) (2.1)
Advertising 209.2 236.3 (27.1) (11.5)
Other 32.6 34.3 (1.7) (5.0)
------------------- -------- -------- --------- ---------
Digital* 32.4 22.0 10.4 47.3
Advertising* 28.5 19.2 9.3 48.4
Other 3.9 2.8 1.1 39.3
------------------- -------- -------- --------- ---------
Revenue* 554.0 578.4 (24.4) (4.2)
------------------- -------- -------- --------- ---------
Costs* (440.5) (459.9) 19.4 4.2
------------------- -------- -------- --------- ---------
Operating profit* 113.5 118.5 (5.0) (4.2)
------------------- -------- -------- --------- ---------
Operating margin* 20.5% 20.5% - -
------------------- -------- -------- --------- ---------
* Comparatives restated for fish4. Note 3 sets out the impact of
this change on the previously reported results.
Revenue fell by 4.2% or GBP24.4 million to GBP554.0 million with
print revenue declining by 6.3% and digital revenue growing by
47.3%. This compares to a decline in print of 6.7% and growth in
digital of 2.3% in the prior year.
Circulation revenue fell by 2.1% reflecting the benefit of cover
price increases which are helping offset the impact of falling
volumes.
The Daily Mirror continues to outperform the market with a
volume decline of 7.4% compared to a 7.8% decline in the UK
national daily tabloid market. The Sunday Mirror and Sunday People
declined by 9.8% and 10.8% respectively in a UK national Sunday
tabloid market that declined by 9.9%. The Daily Record was down
10.7% against an overall Scottish daily tabloid market decline of
9.7% and the Sunday Mail was down 12.3% against an overall Scottish
Sunday tabloid market decline of 11.3%.
The Sunday market remains challenging with continued competitive
pricing in the popular Sunday market with our titles at a premium
to all titles in our market.
The market for our regional titles remains difficult with
declines of 13.3% for paid for dailies, 15.0% for paid for weeklies
and 18.8% for paid for Sundays. This excludes the launch in January
2014 of the Sunday Echo in Liverpool. Whist we have a number of
individual titles performing strongly relative to the market our
overall trends are disappointing.
Print advertising fell by 11.5% with display lower by 10.3%,
classified lower by 13.2% and other categories down by 11.5%.
Whilst the print advertising market remains challenging and
volatile we are encouraged by the improved trends in
recruitment.
The Daily Mirror and the Sunday Mirror have grown print
advertising volume market share with the Daily Mirror growing share
from 18.4% to 18.5% and the Sunday Mirror growing share from 17.1%
to 17.6%. The Sunday People share remained at 10.9%. The Daily
Record share improved from 14.7% to 15.0% and the Sunday Mail share
declined from 27.7% to 26.3% against the main Scottish competitor
set having been impacted by circulation trends being marginally
worse than the market.
For our regional newspapers, we believe our print advertising
performance is broadly in line with market trends although we have
materially improved classified recruitment trends with a decline of
only 4.5% compared to a decline of 24.9% during last year.
Other print revenue declined by 5.0% driven by continued
pressure on leaflets, lower waste sales and lower third party
services revenues partially offset by higher events revenue and
sports publishing contract revenue. The benefit from new contracts
secured by our sports contract publishing business including the
match day programmes contract for Manchester United were partly
offset by changes to other contracts from a profit share
arrangement to a fixed management fee.
Digital revenue increased by 47.3% year on year driven by strong
growth in our publishing digital audience with average monthly
unique users increasing 87% to 73.2 million year on year with
average monthly page views increasing 97% to 509.4 million year on
year. In December, unique users were 81.7 million and page views
were 570.7 million.
Digital advertising revenue increased by 48.4% year on year.
Digital display revenue has seen strong growth all year with growth
of 101.4%. Digital classified revenue fell marginally by 0.2% with
recruitment recovering following the internal changes made in prior
years with growth of 13.2%. Other classified categories of motors
and property remain challenging with dominant competitors. The
remaining classified categories are also challenging and we are
improving our offering in these areas such as through new platforms
for What's On (local entertainment), Buysell (private ads) and BMDs
(births, marriages and death notices).
Digital other revenue increased by 39.3% benefiting from the
growth in audience and new commercial partnerships.
Costs fell by GBP19.4 million or 4.2% to GBP440.5 million. This
includes structural cost savings and the continued tight management
of the cost base to help mitigate the impact of a challenging print
market. The fall in costs is after the impact of an increase in
newsprint prices and increased investment in digital resources and
product development.
Although revenues fell by GBP24.4 million, operating profit fell
by only GBP5.0 million or 4.2% to GBP113.5 million. Operating
margin remained the same as the prior year at 20.5%.
Printing
The revenue and costs of the Printing division is as
follows:
2014 2013 Variance Variance
GBPm GBPm GBPm %
------------------------------ -------- -------- --------- ---------
Contract printing 37.6 38.4 (0.8) (2.1)
Newsprint supply 24.3 24.6 (0.3) (1.2)
Other revenue 2.6 2.7 (0.1) (3.7)
Revenue 64.5 65.7 (1.2) (1.8)
------------------------------ -------- -------- --------- ---------
External costs (188.9) (198.4) 9.5 4.8
Publishing division recharge 124.4 132.7 (8.3) (6.3)
------------------------------ -------- -------- --------- ---------
Operating result - - - -
------------------------------ -------- -------- --------- ---------
Revenues fell by GBP1.2 million or 1.8% to GBP64.5 million.
Revenues from contract printing fell by GBP0.8 million or 2.1% to
GBP37.6 million. Revenue from newsprint supplied to contract print
customers fell due to lower volumes despite higher newsprint
prices.
External costs fell by GBP9.5 million or 4.8% to GBP188.9
million due to the costs associated with increases in contract
printing revenues and inflationary cost increases including the
newsprint price increase more than offset by cost reduction
initiatives.
During the period, the Printing division secured an extension to
its print contracts for the Daily Mail, Independent and i. As part
of these new contracts the Group will no longer supply newsprint to
the Independent and i. The change in the newsprint supply agreement
has no impact on profits, but will reduce revenues and costs for
newsprint supply. In 2014 the annual revenues and costs of
newsprint supplied to the Independent and i was GBP11.1
million.
The net cost recharge to the Publishing division was GBP124.4
million compared to GBP132.7 million in the prior year. This fall
in costs reflects the impact of an increase in newsprint prices and
other inflationary cost increases more than offset by cost savings
and the contribution from third party contracts.
Specialist Digital
The revenue and operating profit of the Specialist Digital
division is as follows:
2014 2013 Variance Variance
GBPm GBPm GBPm %
------------------- ------- ------- --------- ---------
Advertising* 4.8 7.2 (2.4) (33.3)
Other 9.7 9.5 0.2 2.1
Revenue* 14.5 16.7 (2.2) (13.2)
------------------- ------- ------- --------- ---------
Costs* (12.5) (16.3) 3.8 23.3
------------------- ------- ------- --------- ---------
Operating profit* 2.0 0.4 1.6 400.0
------------------- ------- ------- --------- ---------
* Comparatives restated for fish4. Note 3 sets out the impact of
this change on the previously reported results.
The Specialist Digital division includes Trinity Mirror Digital
Recruitment, our digital classified recruitment vertical and
Rippleffect and Communicator, our digital marketing services
businesses. Trinity Mirror Digital Property, a digital classified
property vertical was sold at the end of August 2013.
Excluding Trinity Mirror Digital Property, revenue fell
marginally by GBP0.3 million and operating profit grew by GBP1.8
million. The increase in operating profit is driven by growth in
our digital marketing services businesses and a major restructure
of the recruitment business with the transfer of the business onto
a new technology platform and rationalisation of the portfolio to
focus on the three key brands of GAAPweb, SecsintheCity and
totallylegal.
Central
The revenue and operating loss of the Central division is as
follows:
2014 2013 Variance Variance
GBPm GBPm GBPm %
---------------- ------- ------- --------- ---------
Revenue 3.3 3.0 0.3 10.0
Costs (19.4) (20.7) 1.3 6.3
Associates 6.1 6.8 (0.7) (10.3)
Operating loss (10.0) (10.9) 0.9 8.3
---------------- ------- ------- --------- ---------
The Central division includes revenue and costs not allocated to
the operational divisions and the share of results of associates.
The result for the year was a loss of GBP10.0 million compared to a
loss of GBP10.9 million in the prior year.
Revenue primarily relates to rental income from surplus office
space at the Group's main office at Canary Wharf which increased as
more vacant space was leased to third parties.
Costs fell by GBP1.3 million from GBP20.7 million to GBP19.4
million reflecting cost savings more than offsetting investment in
new business development.
The fall in the share of results of associates is due to the PA
reducing by GBP0.8 million to GBP0.9 million due to the impact of
the disposal of MeteoGroup by the PA partially offset by Local
World increasing by GBP0.1 million to GBP5.2 million.
Other Items
Pensions
The Group operates a defined contribution pension scheme with
contributions and associated costs charged to operating profit. The
defined benefit pension schemes operated by the Group were closed
to future accrual in 2010.
The valuations of the principal schemes as at 31 December 2013
were completed on 9 December 2014. Deficit funding contributions
have been agreed at GBP36.2 million for 2015, 2016 and 2017. In
addition, the Group has agreed that in respect of dividend
payments, additional contributions at 50% of the excess would be
paid if dividends in 2015 were above 5 pence per share. For 2016
and 2017 the threshold increases in line with the increase in
dividends capped at 10% per annum.
During 2014, contributions paid to the defined benefit pension
schemes amounted to GBP18.2 million being an accelerated payment of
GBP17.0 million and GBP1.2 million of other contributions. The
contributions due in respect of 2014 were prepaid in 2013. In
December 2014 the Group pre paid deficit funding contributions of
GBP16.5 million in respect of 2015 and GBP0.5 million in respect of
2016. The next valuation date of the principal schemes is 31
December 2016 and will be finalised by the end of 2017.
The accounting pension deficit increased during the year by
GBP49.0 million from GBP252.2 million (GBP201.8 million net of
deferred tax) to GBP301.2 million (GBP241.0 million net of deferred
tax) reflecting the impact of an increase in liabilities of GBP47.1
million and a fall in assets of GBP1.9 million. The increase in
liabilities has been driven by a further fall in the real discount
rate of 0.40% from 1.05% to 0.65% partially offset by the payment
of pensions and a reduction for buy-outs. The demographic
assumptions have been updated based on the most recent valuations.
The fall in assets was driven by positive return on assets and
company contributions being more than offset by the payment of
pensions and a reduction for buy-outs. The increase in the
accounting pension deficit does not impact the agreed funding
commitments.
Net debt
Contracted net debt, assuming that the private placement loan
notes and the cross-currency interest rate swaps are not terminated
prior to maturity, fell by GBP77.7 million from GBP97.0 million to
GBP19.3 million.
Statutory net debt which includes the US$ denominated private
placement loan notes at the period end exchange rate and the
related cross-currency interest rate swaps at fair value fell by
GBP75.1 million from GBP88.2 million to GBP13.1 million. The fair
value of the Group's cross-currency interest rate swaps was an
asset of GBP3.2 million and the Sterling amount of the private
placement loan notes was GBP65.3 million.
The Group repaid the maturing loan notes of GBP44.2 million in
June 2014 without the need to draw on the Group's bank facility.
The final repayment on the private placement loan notes is GBP68.3
million in June 2017.
On 25 July 2014, the GBP110 million bank facility was cancelled
and replaced with a GBP60 million bank facility which is committed
until July 2018. The reduced facility reflects the benefit of
continued strong cash flows generated by the business and the much
reduced leverage of the Group. The Group had no drawings during the
year on its bank facilities. Cash balances at the reporting date
were GBP49.0 million.
Capital reduction
Following an impairment of investments held by Trinity Mirror
plc during 2013 the Company had a negative balance on the profit
and loss of GBP514.8 million and therefore was not able to pay
dividends or undertake any other distribution to shareholders. To
ensure the Company was in a position to make distributions to
shareholders in the future, the Company applied for court approval
for a capital reduction. On 30 April 2014 the High Court of Justice
made an Order confirming the reduction of the Company's share
premium account by GBP514.8 million, an amount which eliminated the
deficit on the Company's profit and loss account. Profit generated
by the Company after 30 April 2014 is available for distribution to
shareholders.
Principal risks and uncertainties
The principal risks and uncertainties together with mitigating
actions that affected the Group in 2014 and going forward are
described in the Trinity Mirror plc 2014 Annual Report. The
principal risks and uncertainties are:
-- Strategy - the overall strategy or elements of the strategy
are inappropriate and the delivery of the strategy is badly
executed;
-- Revenue loss - faster than anticipated loss of revenue from
print and failure to deliver new revenue streams to offset print
decline and drive revenue growth;
-- Historical legal issues - damage to reputation arising from
historical events, direct financial impact from legal claims and
distraction of senior management time from delivering the strategy;
and
-- Pensions - pension deficits grow at such a rate so as to
affect the viability of the Group itself or so that the annual
funding costs consume a disproportionate level of cash flow.
Related party transactions
There have been no changes in the nature of related party
transactions. Other than the dividends received from associates
there were no material transactions during the year.
Going concern
In accordance with LR 9.8.6(3) of the Listing Rules, and in
determining whether the Group's annual consolidated financial
statements can be prepared on a going concern basis, the directors
considered all factors likely to affect its future development,
performance and its financial position, including cash flows,
liquidity position and borrowing facilities and the risks and
uncertainties relating to its business activities. These are set
out in this Management Report with further detail provided in the
Trinity Mirror plc 2014 Annual Report.
The key factors considered by the directors were as follows:
-- the implications of the volatile economic environment and the
structural changes in the market on the Group's revenues and
profits. The Group undertakes regular forecasts and projections of
trading and identifying areas of focus for management to improve
performance and mitigate the impact of any deterioration in the
economic outlook and structural challenges;
-- the impact of the competitive environment within which the Group's businesses operate;
-- the impact on our business of key suppliers (in particular
newsprint) being unable to meet their obligations to the Group;
-- the impact on our business of key customers being unable to
meet their obligations for services provided by the Group; and
-- the committed finance facilities available to the Group. The
Group has access to a committed bank facility of GBP60 million
under which drawings can be made with 24 hours' notice and was
undrawn at the reporting date. The bank facility is committed to
July 2018. The Group also has overdraft facilities of GBP12 million
to meet day-to-day working capital requirements.
Having considered all the factors impacting the Group's
businesses, including downside sensitivities, the directors are
satisfied that the Group will be able to operate within the terms
and conditions of the Group's financing facilities for the
foreseeable future.
The directors have reasonable expectations that the Company and
the Group have adequate resources to continue in operational
existence for the foreseeable future. Accordingly, they continue to
adopt the going concern basis in preparing the Group's annual
consolidated financial statements.
Board changes
During the year there have been a number of changes to the
Board. Lee Ginsberg, Helen Stevenson and David Kelly joined the
Board as non-executive directors. Mark Hollinshead and Paul Vickers
resigned as executive directors and Gary Hoffman resigned as a
non-executive director. Donal Smith will not seek re-election as a
non-executive director and will retire from the Board at the
conclusion of the next Annual General Meeting on 7 May 2015.
Statement of directors' responsibilities
The directors are responsible for preparing the Annual Results
Announcement in accordance with applicable laws and regulations.
The responsibility statement below has been prepared in connection
with the Company's full Annual Report for the 52 weeks ended 28
December 2014. Certain points thereof are not included within this
Annual Results Announcement.
The directors confirm to the best of their knowledge:
a) the consolidated financial statements, prepared in accordance
with International Financial Reporting Standards as adopted by the
European Union, give a true and fair view of the assets,
liabilities, financial position and profit and loss of the Company
and the undertakings included in the consolidation taken as a
whole; and
b) the Management Report includes a fair review of the
development and performance of the business and the position of the
Company and the undertakings included in the consolidation taken as
a whole, together with a description of the principal risks and
uncertainties they face.
By order of the Board of directors
Simon Fox Vijay Vaghela
Chief Executive Group Finance Director
Consolidated income statement
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
2014 2013
notes GBPm GBPm
------------------------------------------------------- -------- -------- --------
Revenue 3,4 636.3 663.8
Cost of sales (329.9) (344.9)
------------------------------------------------------- -------- -------- --------
Gross profit 306.4 318.9
Distribution costs (67.5) (74.9)
Administrative expenses:
Non-recurring items: 5
Impairment of goodwill and other intangible
assets - (225.0)
Other (12.0) 0.6
Amortisation of other intangible assets (2.2) (2.2)
Pension administrative expenses 13 (3.2) (2.8)
Restructuring charges in respect of cost reduction
measures (14.0) (9.9)
Other administrative expenses (139.5) (142.8)
Share of results of associates:
Results before non-recurring items and amortisation 6.1 6.8
Non-recurring items 5 27.2 (0.5)
Amortisation of other intangible assets (2.7) (3.0)
Operating profit/(loss) 3 98.6 (134.8)
Investment revenues 6 0.3 0.3
Pension finance charge 13 (11.2) (13.2)
Finance costs 7 (6.1) (13.1)
------------------------------------------------------- -------- -------- --------
Profit/(loss) before tax 81.6 (160.8)
Tax (charge)/credit 8 (11.8) 64.4
------------------------------------------------------- -------- -------- --------
Profit/(loss) for the period attributable to
equity holders of the parent 69.8 (96.4)
Statutory earnings/(loss) per share 2014 2013
Pence Pence
------------------------------------------------------- -------- -------- --------
Earnings/(loss) per share - basic 10 28.1 (39.0)
Earnings/(loss/ per share - diluted 10 27.4 (39.0)
------------------------------------------------------- -------- -------- --------
Adjusted* earnings per share 2014 2013
Pence Pence
------------------------------------------------------- -------- -------- --------
Earnings per share - basic 10 32.8 32.0
Earnings per share - diluted 10 32.0 30.7
------------------------------------------------------- -------- -------- --------
*Adjusted items relate to the exclusion of non-recurring items
(share of non-recurring credit from associate undertakings of
GBP27.2 million and provision for historical legal issues of
GBP12.0 million), restructuring charges in respect of cost
reduction measures, the amortisation of intangible assets, the
retranslation of foreign currency borrowings, the impact of fair
value changes on derivative financial instruments, the pension
finance charge, the pension administrative expenses and the impact
of tax legislation changes. Set out in note 16 is the
reconciliation between the statutory results and the adjusted
results.
Consolidated statement of comprehensive income
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
2014 2013
notes GBPm GBPm
----------------------------------------------- -------- ------- -------
Profit/(loss) for the period 69.8 (96.4)
----------------------------------------------- -------- ------- -------
Items that will not be reclassified to profit
and loss:
Actuarial (losses)/gains on defined benefit
pension schemes 13 (52.8) 42.5
Tax on actuarial (losses)/gains on defined
benefit pension schemes 8 10.6 (8.5)
Deferred tax charge resulting from the future
change in tax rate 8 - (8.9)
Share of items recognised by associates - (1.0)
----------------------------------------------- -------- ------- -------
Other comprehensive (costs)/income for the
period (42.2) 24.1
Total comprehensive income/(costs) for the
period 27.6 (72.3)
----------------------------------------------- -------- ------- -------
Consolidated cash flow statement
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
2014 2013
notes GBPm GBPm
------------------------------------------------------- -------- ------- -------
Cash flows from operating activities
Cash generated from operations 11 90.1 92.9
Income tax paid (17.3) (22.0)
------------------------------------------------------- -------- ------- -------
Net cash inflow from operating activities 72.8 70.9
------------------------------------------------------- -------- ------- -------
Investing activities
Interest received 0.3 0.3
Dividends received from associates 16.0 2.3
Proceeds on disposal of subsidiary undertaking 0.9 2.5
Proceeds on disposal of property, plant and
equipment 0.2 0.7
Purchases of property, plant and equipment (6.4) (8.0)
Acquisition of associate undertaking - (14.2)
Net cash received from/(used in) investing activities 11.0 (16.4)
------------------------------------------------------- -------- ------- -------
Financing activities
Interest paid on borrowings (3.9) (5.7)
Repayment of borrowings (44.2) (54.5)
Purchase of shares for LTIP (2.2) (3.0)
Net cash used in financing activities (50.3) (63.2)
------------------------------------------------------- -------- ------- -------
Net increase/(decrease) in cash and cash equivalents 33.5 (8.7)
------------------------------------------------------- -------- ------- -------
Cash and cash equivalents at the beginning of
the period 12 15.5 24.2
------------------------------------------------------- -------- ------- -------
Cash and cash equivalents at the end of the
period 12 49.0 15.5
------------------------------------------------------- -------- ------- -------
Consolidated statement of changes in equity
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
Retained
Share Capital earnings
Share premium redemption and other
capital account reserve reserves Total
GBPm GBPm GBPm GBPm GBPm
------------------------------------- ---------- ---------- ------------- ----------- --------
At 30 December 2012 (25.8) (1,121.6) (4.3) 512.7 (639.0)
Loss for the period - - - 96.4 96.4
Other comprehensive income
for the period - - - (24.1) (24.1)
------------------------------------- ---------- ---------- ------------- ----------- --------
Total comprehensive costs for
the period - - - 72.3 72.3
------------------------------------- ---------- ---------- ------------- ----------- --------
Credit to equity for equity-settled
share-based payments - - - (8.0) (8.0)
Purchase of shares for LTIP - - - 3.0 3.0
At 29 December 2013 (25.8) (1,121.6) (4.3) 580.0 (571.7)
Profit for the period - - - (69.8) (69.8)
Other comprehensive costs for
the period - - - 42.2 42.2
------------------------------------- ---------- ---------- ------------- ----------- --------
Total comprehensive income
for the period - - - (27.6) (27.6)
------------------------------------- ---------- ---------- ------------- ----------- --------
Capital reduction - 514.8 - (514.8) -
Charge to equity for equity-settled
share-based payments - - - 2.2 2.2
Purchase of shares for LTIP - - - 2.2 2.2
Reclassification - 0.1 (0.1) - -
At 28 December 2014 (25.8) (606.7) (4.4) 42.0 (594.9)
------------------------------------- ---------- ---------- ------------- ----------- --------
Consolidated balance sheet
at 28 December 2014 (29 December 2013)
2014 2013
notes GBPm GBPm
--------------------------------------------- -------- -------- ----------
Non-current assets
Goodwill 12.0 12.0
Other intangible assets 668.9 671.1
Property, plant and equipment 317.7 337.6
Investment in associates 41.4 26.8
Retirement benefit assets 13 17.8 15.7
Deferred tax assets 62.1 57.0
Derivative financial instruments 3.2 1.9
--------------------------------------------- -------- -------- ----------
1,123.1 1,122.1
--------------------------------------------- -------- -------- ----------
Current assets
Inventories 7.0 8.9
Trade and other receivables 103.3 110.5
Cash and cash equivalents 12 49.0 15.5
--------------------------------------------- -------- -------- ----------
159.3 134.9
--------------------------------------------- -------- -------- ----------
Total assets 1,282.4 1,257.0
--------------------------------------------- -------- -------- ----------
Non-current liabilities
Borrowings 12 (65.3) (62.0)
Retirement benefit obligations 13 (319.0) (267.9)
Deferred tax liabilities (178.0) (180.7)
Provisions 14 (6.9) (13.8)
(569.2) (524.4)
--------------------------------------------- -------- -------- ----------
Current liabilities
Borrowings 12 - (40.4)
Trade and other payables (83.0) (90.3)
Current tax liabilities (12.0) (16.7)
Provisions 14 (23.3) (10.3)
Derivative financial instruments 12 - (3.2)
--------------------------------------------- -------- -------- ----------
(118.3) (160.9)
--------------------------------------------- -------- -------- ----------
Total liabilities (687.5) (685.3)
--------------------------------------------- -------- -------- ----------
Net assets 594.9 571.7
--------------------------------------------- -------- -------- ----------
Equity
Share capital 15 (25.8) (25.8)
Share premium account 15 (606.7) (1,121.6)
Capital redemption reserve 15 (4.4) (4.3)
Retained earnings and other reserves 15 42.0 580.0
--------------------------------------------- -------- -------- ----------
Total equity attributable to equity holders
of the parent (594.9) (571.7)
--------------------------------------------- -------- -------- ----------
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
1. General information
The financial information in the Annual Results Announcement is
derived from but does not represent the full statutory accounts of
Trinity Mirror plc. The statutory accounts for the 52 weeks ended
29 December 2013 have been filed with the Registrar of Companies
and those for the 52 weeks ended 28 December 2014 will be filed
following the Annual General Meeting on 7 May 2015. The auditors'
reports on the statutory accounts for the 52 weeks ended 29
December 2013 and for the 52 weeks ended 28 December 2014 were
unqualified, do not include reference to any matters to which the
auditors drew attention by way of emphasis of matter without
qualifying the reports and do not contain a statement under Section
498 (2) or (3) of the Companies Act 2006.
Whilst the financial information included in this Annual Results
Announcement has been prepared in accordance with the recognition
and measurement criteria of International Financial Reporting
Standards (IFRS), this announcement does not itself contain
sufficient information to comply with IFRS. This Annual Results
Announcement constitutes a dissemination announcement in accordance
with Section 6.3 of the Disclosure and Transparency Rules (DTR).
The Annual Report for the 52 weeks ended 28 December 2014 is
available on the Company's website at www.trinitymirror.com and at
the Company's registered office at One Canada Square, Canary Wharf,
London E14 5AP and will be sent to shareholders who have elected to
receive a hard copy by the end of March 2015.
The financial information has been prepared for the 52 weeks
ended 28 December 2014 and the comparative period has been prepared
for the 52 weeks ended 29 December 2013. Throughout this report,
the financial information for the 52 weeks ended 28 December 2014
is referred to and headed 2014 and for the 52 weeks ended 29
December 2013 is referred to and headed 2013.
2. Accounting polices
The financial information has been prepared in accordance with
IFRS as adopted by the European Union. These are subject to ongoing
amendment by the International Accounting Standards Board and by
the European Union and are therefore subject to change. As a
result, the financial information contained herein will need to be
updated for any subsequent amendment to IFRS or any new standards
that are issued. The financial information has been prepared under
the historical cost convention as modified by the revaluation of
freehold properties which on transition to IFRS were deemed to be
the cost of the asset.
The accounting policies used in the preparation of the
consolidated financial statements for the 52 weeks ended 28
December 2014 have been consistently applied to all the periods
presented except for the changes in accounting policy noted below
and are set out in the Trinity Mirror plc 2014 Annual Report. These
consolidated financial statements have been prepared on a going
concern basis as set out in the Management Report in this Annual
Results Announcement.
Changes in accounting policy
Except as noted below, the same accounting policies,
presentation and methods of computation are followed in the
consolidated financial statements as applied in the Group's latest
annual consolidated financial statements.
The Group has adopted new, amended and revised standards and
interpretations during the current financial period which have had
no material impact on the Group:
-- IFRS 10 (Issued) 'Consolidated Financial Statements' -
effective for periods beginning on or after 1 January 2014
-- IFRS 11 (Issued) 'Joint Arrangements' - effective for periods
beginning on or after 1 January 2014
-- IFRS 12 (Issued) 'Disclosure of Interests in Other Entities'
- effective for periods beginning on or after 1 January 2014
-- IAS 27 (Revised) 'Separate Financial Statements' - effective
for periods beginning on or after 1 January 2014
-- IAS 28 (Revised) 'Investments in Associates' - effective for
periods beginning on or after 1 January 2014
-- IAS 32 (Amended) 'Financial Instruments' - effective for
periods beginning on or after 1 January 2014
-- IAS 36 (Amended) 'Impairment of Assets' - effective for
periods beginning on or after 1 January 2014
-- IAS 39 (Amended) 'Financial Instruments' - effective for
periods beginning on or after 1 January 2014
At the date of approval of these consolidated financial
statements the following new and amended standards, which have not
been applied and when adopted will have no material impact on the
Group, were in issue but not yet effective:
-- IAS 19 (Amended) 'Employee Benefits' - effective for periods
beginning on or after 1 February 2015
-- IFRIC 21 (Issued) 'Levies' - effective for periods starting on or after 17 June 2014
-- Annual Improvements 2010-2012, effective for periods starting on or after 1 February 2015
-- Annual Improvements 2011-2013, effective for periods starting on or after 1 January 2015
At the date of approval of these consolidated financial
statements, IFRS 9 (Issued) 'Financial Instruments' and IFRS 15
(Issued) 'Revenue from contracts with Customers', which have not
been applied and when adopted will have no material impact on the
Group, were not yet endorsed by the EU and have no effective
date.
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
2. Accounting polices (continued)
Key sources of estimation uncertainty
The key assumptions concerning the future and other key sources
of estimation uncertainty that have a significant risk of causing a
material adjustment to the carrying amounts of assets and
liabilities within the next financial year, are discussed
below:
Impairment of goodwill and other intangible assets
Determining whether goodwill and other intangible assets are
impaired requires an estimation of the value in use of the
cash-generating unit to which these have been allocated. The value
in use calculation requires the Group to estimate the future cash
flows expected to arise from the cash-generating unit and a
suitable discount rate in order to calculate present value.
Retirement benefits
Actuarial assumptions adopted and external factors can
significantly vary the surplus or deficit of defined benefit
pension schemes. Advice is sourced from independent actuaries in
selecting suitable assumptions.
Provisions
There is uncertainty as to liabilities arising from the outcome
or resolution of the ongoing historical legal issues.
Critical judgements in applying the Group's accounting
policies
No critical judgements in applying the Group's accounting
policies have been identified in the current or preceding year.
3. Operating segments
Operating segments are identified on the basis of internal
reports about components of the Group that are regularly reviewed
by the Board and chief operating decision maker to allocate
resources to the segments and to assess their performance. The
Group has four operating segments that are regularly reviewed by
the Board and chief operating decision maker.
The operating segments are: Publishing which includes all of our
newspapers and associated digital publishing; Printing which
provides printing services to the publishing segment and to third
parties; Specialist Digital which includes our acquired digital
recruitment classified business and our digital marketing services
businesses; and Central which includes revenue and costs not
allocated to the operational divisions and our share of results of
associates.
The accounting policies used in the preparation of each
segment's revenue and results are the same as the Group's
accounting policies described in note 2. The Board and chief
operating decision maker are not provided with an amount for total
assets by segment. The Group's operations are located primarily in
the UK and the Group is not subject to significant seasonality
during the year.
Segment revenue and results
52 weeks ended 28 December 2014 Publishing
2014 Specialist
GBPm Printing Digital Central Total
2014 2014 2014 2014
GBPm GBPm GBPm GBPm
---------------------------------- ------------ ----------- ------------- ---------- --------
Revenue
Segment sales 554.0 188.9 15.8 3.3 762.0
Inter-segment sales - (124.4) (1.3) - (125.7)
---------------------------------- ------------ ----------- ------------- ---------- --------
Total revenue 554.0 64.5 14.5 3.3 636.3
---------------------------------- ------------ ----------- ------------- ---------- --------
Segment result 113.5 - 2.0 (10.0) 105.5
------------ ----------- ------------- ----------
Amortisation of other intangible
assets (4.9)
Pension administrative expenses (3.2)
Restructuring charges in respect
of cost reduction measures (14.0)
Non-recurring items 15.2
---------------------------------- ------------ ----------- ------------- ---------- --------
Operating profit 98.6
Investment revenues 0.3
Pension finance charge (11.2)
Finance costs (6.1)
---------------------------------- ------------ ----------- ------------- ---------- --------
Profit before tax 81.6
Tax charge (11.8)
---------------------------------- ------------ ----------- ------------- ---------- --------
Profit for the period 69.8
---------------------------------- ------------ ----------- ------------- ---------- --------
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
3. Operating segments (continued)
Segment revenue and results (continued)
Following a change in management structure, the Group has moved
the revenue and results of fish4 from the Specialist Digital
operating segment to the Publishing operating segment. The revision
to the operating segments has had no impact on the revenue or
operating profit of the Group. The 2013 comparatives have been
restated as a result of this change.
The effect of the changes in reporting on the comparatives is
shown below:
As reported fish4
29 December 29 December As restated
29 December
2013 2013 2013
GBPm GBPm GBPm
----------------------- ---------- ----------- -------- ----- --------------- ------------- -------------
Publishing 576.4 2.0 578.4
Specialist Digital 18.7 (2.0) 16.7
Revenue 595.1 - 595.1
----------------------- ---------- ----------- ----- --------------- ------------- -------------
Publishing 118.5 - 118.5
Specialist Digital 0.4 - 0.4
Operating profit 118.9 - 118.9
----------------------- ---------- ----------- ----- --------------- ------------- -------------
Publishing Specialist
52 weeks ended 29 December 2013 Printing Digital Central Total
2013 (restated) GBPm 2013 2013 2013 2013
GBPm GBPm GBPm GBPm
---------------------------------- -------------- ------------- ------------- ------------ --------
Revenue
Segment sales 578.4 198.4 18.0 3.0 797.8
Inter-segment sales - (132.7) (1.3) - (134.0)
---------------------------------- -------------- ------------- ------------- ------------ --------
Total revenue 578.4 65.7 16.7 3.0 663.8
---------------------------------- -------------- ------------- ------------- ------------ --------
Segment result 118.5 - 0.4 (10.9) 108.0
-------------- ------------- ------------- ------------
Amortisation of other intangible
assets (5.2)
Pension administrative expenses (2.8)
Restructuring charges in respect
of cost reduction measures (9.9)
Non-recurring items (224.9)
---------------------------------- -------------- ------------- ------------- ------------ --------
Operating loss (134.8)
Investment revenues 0.3
Pension finance charge (13.2)
Finance costs (13.1)
---------------------------------- -------------- ------------- ------------- ------------ --------
Loss before tax (160.8)
Tax credit 64.4
---------------------------------- -------------- ------------- ------------- ------------ --------
Loss for the period (96.4)
---------------------------------- -------------- ------------- ------------- ------------ --------
4. Revenue
2014 2013
GBPm GBPm
--------------- ------ ------
Circulation 279.8 285.8
Advertising 242.5 262.7
Printing 64.5 65.7
Other 49.5 49.6
--------------- ------ ------
Total revenue 636.3 663.8
--------------- ------ ------
The Group's operations are located primarily in the UK. The
Group's revenue by location of customers is set out below:
2014 2013
GBPm GBPm
---------------------------- ------ ------
UK and Republic of Ireland 632.7 659.9
Continental Europe 3.5 3.7
Rest of World 0.1 0.2
---------------------------- ------ ------
Total revenue 636.3 663.8
---------------------------- ------ ------
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
5. Non-recurring items
2014 2013
GBPm GBPm
--------------------------------------------------------- ------- --------
Provision for historical legal issues (a) (12.0) -
Impairment of goodwill and other intangible assets
(b) - (225.0)
Profit on disposal of subsidiary undertaking (c) - 0.6
Non-recurring items included in administrative expenses (12.0) (224.4)
Non-recurring items included in share of results of
associates (d) 27.2 (0.5)
Total non-recurring items 15.2 (224.9)
--------------------------------------------------------- ------- --------
a) The Group is aware of a number of civil claims from
individuals in relation to phone hacking. In the period we have
provided GBP12.0 million to cover the cost of dealing with and
resolving claims. It remains uncertain as to how these matters will
progress, whether further allegations or claims will be made, and
their financial impact. Due to this uncertainty a contingent
liability has been highlighted in note 17.
b) At the 2013 reporting date, an impairment review comparing
the carrying value of the Group's assets with value in use was
undertaken in accordance with IAS 36. The review indicated that a
GBP225.0 million impairment charge against goodwill and publishing
rights and titles in respect of the Nationals and certain regional
(Scotland, North East and Cardiff) cash-generating units was
required.
c) During the second half of 2013, the Group disposed of Trinity
Mirror Digital Property Limited realising a profit on disposal of
GBP0.6 million.
d) Share of the after tax non-recurring items comprising our
GBP27.5 million share of the gain on the disposal by PA Group of
its weather forecasting business, MeteoGroup, our GBP0.4 million
share of the profit of MeteoGroup recorded by PA Group up to the
date of completion less our GBP0.7 million share of restructuring
costs incurred by PA Group and Local World.
6. Investment revenues
2014 2013
GBPm GBPm
----------------------------------------------------- ------ ------
Interest income on bank deposits and other interest
receipts 0.3 0.3
----------------------------------------------------- ------ ------
7. Finance costs
2014 2013
GBPm GBPm
----------------------------------------------------- ------ -------
Interest on bank overdrafts and borrowings (3.5) (7.0)
------------------------------------------------------ ------ -------
Total interest expense (3.5) (7.0)
Fair value loss on derivative financial instruments (0.3) (8.8)
Foreign exchange (loss)/gain on retranslation
of borrowings (2.3) 2.7
------------------------------------------------------ ------ -------
Finance costs (6.1) (13.1)
------------------------------------------------------ ------ -------
8. Tax
2014 2013
GBPm GBPm
---------------------------------------------- ------- -------
Current tax
UK corporation tax charge for the period (14.0) (19.1)
Prior period adjustment 0.2 1.0
----------------------------------------------- ------- -------
Current tax charge (13.8) (18.1)
----------------------------------------------- ------- -------
Deferred tax
Deferred tax credit for the period 2.1 48.3
Prior period adjustment (0.1) (0.1)
Deferred tax rate change - 34.3
Deferred tax credit 2.0 82.5
----------------------------------------------- ------- -------
Tax (charge)/credit (11.8) 64.4
----------------------------------------------- ------- -------
% %
---------------------------------------------- ------- -------
Reconciliation of tax (charge)/credit
Standard rate of corporation tax (21.5) 23.3
Tax effect of items that are not deductible
in determining taxable profit/(loss) (1.1) (1.0)
Prior period adjustment 0.1 0.6
Deferred tax rate change - 16.6
Tax effect of share of results of associates 8.0 0.5
Tax (charge)/credit rate (14.5) 40.0
----------------------------------------------- ------- -------
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
8. Tax (continued)
The standard rate of UK corporation tax reduced from 23% to 21%
on 1 April 2014. The blended rate for the accounting year is 21.5%
being a mix of 23% up to 31 March 2014 and 21% from 1 April 2014
(2013: 23.25% being a mix of 24% up to 31 March 2013 and 23% from 1
April 2013). The current tax liabilities amounted to GBP12.0
million (2013: GBP16.7 million) at the reporting date.
The opening deferred tax position is recalculated in the period
in which a change in the standard rate of corporation tax has been
enacted or substantively enacted by parliament. The change in rate
from 23% to 20% was accounted for in the prior year resulting in a
GBP34.3 million credit in the consolidated income statement and a
GBP8.9 million charge in the consolidated statement of
comprehensive income.
The tax on actuarial (losses)/gains on defined benefit pension
schemes taken to the consolidated statement of comprehensive income
is a credit of GBP10.6 million comprising a deferred tax credit of
GBP9.8 million and a current tax credit of GBP0.8 million (2013: a
charge of GBP8.5 million comprising a deferred tax charge of GBP9.2
million and a current tax credit of GBP0.7 million).
The tax on share-based payments taken to equity is a charge of
GBP3.3 million comprising a deferred tax charge of GBP3.7 million
and a current tax credit of GBP0.4 million (2013: deferred tax
credit of GBP5.9 million).
9. Dividends
2014 2013
pence pence
------------------ ------- -------
Dividend proposed 3.0 -
Dividend paid - -
------------------ ------- -------
No dividends were declared for 2013. In 2014, no interim
dividend was declared but it is proposed that a final dividend of 3
pence per ordinary share is paid for 2014 on 4 June 2015 to
shareholders on the register on 8 May 2015. The proposed dividend
is subject to shareholder approval at the Annual General Meeting on
7 May 2015. If approved, it is estimated that the total cost of the
dividend will be some GBP7.7 million.
10. Earnings per share
2014 2013
GBPm GBPm
------------------------------------------------- ------- --------
Profit after tax before adjusted* items 81.3 79.1
Adjusted* items:
Non-recurring items (after tax) 17.6 (180.6)
Amortisation of other intangibles (after tax) (4.5) (4.8)
Finance costs (after tax) (2.1) (4.9)
Restructuring charges (after tax) (11.0) (7.6)
Pension charges (after tax) (11.5) (12.8)
Tax legislation changes - 35.2
Profit/(loss) for the period 69.8 (96.4)
-------------------------------------------------- ------- --------
2014 2013
Weighted average number of ordinary shares Thousand Thousand
---------------------------------------------- ---------- ----------
Weighted average number of ordinary shares
for basic earnings per share 248,108 247,328
Effect of potential dilutive ordinary shares
in respect of share options 6,574 10,063
Weighted average number of ordinary shares
for diluted earnings per share 254,682 257,391
----------------------------------------------- ---------- ----------
Basic earnings per share is calculated by dividing profit for
the period attributable to equity holders of the parent by the
weighted average number of ordinary shares during the period.
Diluted earnings per share is calculated by adjusting the weighted
average number of ordinary shares in issue on the assumption of
conversion of all potentially dilutive ordinary shares. The
weighted average number of potentially dilutive ordinary shares not
currently dilutive was 4,679,307 (2013: 5,215,571).
Statutory earnings/(loss) per share 2014 2013
Pence Pence
Earnings/(loss) per share - basic 28.1 (39.0)
Earnings/(loss)/ per share - diluted 27.4 (39.0)
---------------------------------------- -------- --------
In the prior year potentially dilutive ordinary shares in
respect of share options have not been included in the statutory
diluted loss per share calculation as they are antidilutive in this
instance.
Adjusted* earnings per share 2014 2013
Pence Pence
------------------------------ ------- -------
Earnings per share - basic 32.8 32.0
Earnings per share - diluted 32.0 30.7
------------------------------- ------- -------
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
10. Earnings per share (continued)
The basic earnings per share impact for each non-recurring item
disclosed in note 5 are as follows:
2014 2013
Pence Pence
----------------------------------------------- ------- -------
Provision for historical legal issues (4.1) -
Impairment of goodwill and other intangible
assets - (73.1)
Profit on disposal of subsidiary undertaking - 0.3
Loss per share - non-recurring items included
in administrative expenses (4.1) (72.8)
Profit/(loss) per share - non-recurring items
included in share of results of associates 11.0 (0.2)
Profit/(loss) per share - total non-recurring
items 6.9 (73.0)
------------------------------------------------ ------- -------
*Adjusted items relate to the exclusion of non-recurring items
(share of non-recurring credit from associate undertakings of
GBP27.2 million and provision for historical legal issues of
GBP12.0 million), restructuring charges in respect of cost
reduction measures, the amortisation of intangible assets, the
retranslation of foreign currency borrowings, the impact of fair
value changes on derivative financial instruments, the pension
finance charge, the pension administrative expenses and the impact
of tax legislation changes. Set out in note 16 is the
reconciliation between the statutory results and the adjusted
results.
11. Notes to the consolidated cash flow statement
2014 2013
GBPm GBPm
--------------------------------------------------- ------ -------
Operating profit/(loss) 98.6 (134.8)
Depreciation of property, plant and equipment 24.5 26.4
Impairment of goodwill and other intangible
assets - 225.0
Amortisation of other intangible assets 2.2 2.2
Share of results of associates (30.6) (3.3)
(Credit)/charge for share-based payments (0.4) 2.3
Profit on disposal of subsidiary undertaking - (0.6)
Profit on disposal of fixed assets - (0.2)
Write-off of fixed assets 0.9 1.2
Pension administrative expenses 3.2 2.8
Pension deficit funding payments (18.2) (19.0)
---------------------------------------------------- ------ -------
Operating cash flows before movements in working
capital 80.2 102.0
Decrease/(increase) in inventories 1.9 (1.9)
Decrease/(increase) in receivables 6.4 (4.4)
Increase/(decrease) in payables 1.6 (2.8)
---------------------------------------------------- ------ -------
Cash flows from operating activities 90.1 92.9
---------------------------------------------------- ------ -------
12. Net debt
The statutory net debt for the Group is as follows:
Derivative
29 December financial Foreign 28 December
2013 Cash flow instruments* exchange* Loans repaid 2014
GBPm GBPm GBPm GBPm GBPm GBPm
------------------------- -------------- ------------ -------------- ------------ --------------- --------------
Non-current liabilities
Loan notes (62.0) - - (3.3) - (65.3)
(62.0) - - (3.3) - (65.3)
------------------------- -------------- ------------ -------------- ------------ --------------- --------------
Current liabilities
Loan notes (40.4) - - 1.0 39.4 -
Derivative financial
instruments (3.2) - (1.6) - 4.8 -
------------------------- -------------- ------------ -------------- ------------ --------------- --------------
(43.6) - (1.6) 1.0 44.2 -
------------------------- -------------- ------------ -------------- ------------ --------------- --------------
Non-current assets
Derivative financial
instruments 1.9 - 1.3 - - 3.2
------------------------- -------------- ------------ -------------- ------------ --------------- --------------
1.9 - 1.3 - - 3.2
Current assets
Cash and cash
equivalents 15.5 77.7 - - (44.2) 49.0
------------------------- -------------- ------------ -------------- ------------ --------------- --------------
15.5 77.7 - - (44.2) 49.0
------------------------- -------------- ------------ -------------- ------------ --------------- --------------
Net debt (88.2) 77.7 (0.3) (2.3) - (13.1)
------------------------- -------------- ------------ -------------- ------------ --------------- --------------
* The impact on the loan notes of translation into Sterling at
the settlement date or at the reporting date exchange rate and the
impact on the derivative financial instruments of being stated at
fair value at the settlement date or at the reporting date are
included in the consolidated income statement within finance costs
as set out in note 7.
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
12. Net debt (continued)
The Group has cross-currency interest rate swaps to manage its
exposure to foreign exchange movements and interest rate movements
on the private placement loan notes. Fair value is calculated using
discounted cash flows based upon forward rates available to the
Group. The cross-currency interest rate swaps are classed in level
two of the financial instruments hierarchy. Level two fair value
measurements are those derived from inputs other than quoted prices
that are observable for the asset or liability, either directly or
indirectly.
The contracted net debt for the Group, assuming that the private
placement loan notes and the cross-currency interest rate swaps are
not terminated prior to maturity, is as follows:
29 December 28 December
2013 Cash flow Loans repaid 2014
GBPm GBPm GBPm GBPm
--------------------------- -------------- ------------ --------------- --------------
Non-current liabilities
Loan notes (68.3) - - (68.3)
(68.3) - - (68.3)
--------------------------- -------------- ------------ --------------- --------------
Current liabilities
Loan notes (44.2) - 44.2 -
(44.2) - 44.2 -
--------------------------- -------------- ------------ --------------- --------------
Current assets
Cash and cash equivalents 15.5 77.7 (44.2) 49.0
--------------------------- -------------- ------------ --------------- --------------
15.5 77.7 (44.2) 49.0
--------------------------- -------------- ------------ --------------- --------------
Net debt (97.0) 77.7 - (19.3)
--------------------------- -------------- ------------ --------------- --------------
The statutory net debt reconciles to the contracted net debt as
follows:
2014 2013
GBPm GBPm
---------------------------------------- ------- --------
Statutory net debt (13.1) (88.2)
Loan notes at period end exchange rate 65.3 102.4
Loan notes at swapped exchange rate (68.3) (112.5)
Cross-currency interest rate swaps (3.2) 1.3
Contracted net debt (19.3) (97.0)
---------------------------------------- ------- --------
13. Retirement benefit schemes
Defined contribution pension schemes
The Group operates the Trinity Mirror Pension Plan (the 'TMPP
Scheme'), which is a defined contribution pension scheme for
qualifying employees. The assets of the scheme are held separately
from those of the Group in funds under the control of Trustees.
The Group implemented the Auto Enrolment legislation from 1 July
2013. The TMPP Scheme has three sections, one for members who
elected to join prior to 1 May 2013 which is now closed to new
members, one for members who elect to join from 1 May 2013 and one
for members from 1 July 2013 who are auto enrolled.
The current service cost charged to the consolidated income
statement of GBP13.9 million (2013: GBP14.8 million) represents
contributions payable to the scheme by the Group at rates specified
in the scheme rules. Contributions that were due have been paid
over to the scheme at all reporting dates.
Defined benefit pension schemes
Background
The Group's defined benefit pension schemes were closed to new
entrants from 1 January 2003 and closed to future accrual from 31
March 2010.
The principal schemes which together represent the majority of
the aggregate value of the assets and liabilities are the Mirror
Group Pension Scheme (the 'Old Scheme'), the MGN Past Service
Pension Scheme (the 'Past Service Scheme'), the MGN Pension Scheme
(the 'MGN Scheme'), the Trinity Retirement Benefit Scheme (the
'Trinity Scheme') and the Midland Independent Newspapers Pension
Scheme (the 'MIN Scheme').
The Old Scheme and the Past Service Scheme cover the liabilities
for service up to 13 February 1992 for employees and former
employees who worked regularly on the production and distribution
of Mirror Group's newspapers. The Old Scheme was closed on 13
February 1992 and the Past Service Scheme was established to meet
any liabilities which are not satisfied by payments from the Old
Scheme and the Maxwell Communications Pension Plan. No
contributions have been paid to the Old Scheme since 1992. The
disclosures contained in this note in respect of these two schemes
are combined (the 'Old Scheme/Past Service Scheme').
The remaining defined benefit pension schemes have all secured
their members benefits by way of a buy-in or buy-out with insurance
companies. It is expected that these schemes will be wound up
during 2015 without further contributions from the Group. On
completion of the winding up of these schemes, any surplus assets
will be transferred to one of the principal schemes.
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
13. Retirement benefit schemes (continued)
Defined benefit pension schemes (continued)
Characteristics
The defined benefit pension schemes provide pensions to members
which are based on the final salary pension payable normally from
age 65 plus surviving spouses or dependents benefits following a
member's death. Benefits increase both before and after retirement
either in line with statutory requirements or in accordance with
the scheme rules. Such increases are either at fixed rates or in
line with retail or consumer prices but subject to upper and lower
limits. All of the schemes are independent of the Group with assets
held independently of the Group. They are governed by Trustees who
administer benefits in accordance with the scheme rules and
appropriate UK legislation. The principal schemes each have a
professional independent trustee as their chairman with half of the
remaining Trustees nominated by the members and half by the
Group.
Maturity profile and cash flow
Across the principal schemes, the invested assets at the
reporting date are expected to be sufficient to pay the uninsured
benefits due up to 2044, based on the reporting date assumptions.
The remaining uninsured benefit payments, payable from 2045, are
due to be funded by a combination of asset outperformance and the
deficit contributions currently scheduled to be paid by 2025. The
liabilities relate 50% to current pensioners and their spouses or
dependants and 50% relate to deferred pensioners. The average term
from the reporting date to payment of the remaining benefits was
around 16 years. Uninsured benefit payments in 2014 were GBP46
million, projected to rise to an annual peak in 2039 of GBP83
million and reducing thereafter.
Funding arrangements
The funding of the Group's principal schemes is subject to UK
pension legislation as well as the guidance and codes of practice
issued by the Pensions Regulator. Funding targets are agreed
between the Trustees and the Group and are reviewed and revised
usually every three years. The funding targets must include a
margin for prudence above the expected cost of paying the benefits
and so are different to the liability value for IAS 19 purposes.
The funding deficits revealed by these triennial valuations are
removed over time in accordance with an agreed recovery plan and
schedule of contributions for each scheme.
The valuations of the principal schemes as at 31 December 2013
were completed on 9 December 2014. The valuations showed deficits
of GBP216.0 million for the Old Scheme/Past Service Scheme,
GBP120.7 million for the MGN Scheme, GBP31.9 million for the
Trinity Scheme and GBP26.7 million for the MIN Scheme. The next
valuation date of the principal schemes is due as at 31 December
2016.
Deficit funding contributions have been agreed totalling GBP36.2
million for 2015, 2016 and 2017. Contributions remain at around
GBP36 million from 2018 to 2023 and then reduce to around GBP21
million for 2024 and 2025 after which contributions are due to
cease. The combined deficit is expected to be eradicated by 2027 by
a combination of the contributions and asset returns over assumed
investment returns.
In addition, the Group has agreed that in respect of dividend
payments in 2015, 2016 and 2017 that additional contributions would
be paid at 50% of the excess if dividends in 2015 were above 5
pence per share. For 2016 and 2017 the threshold increases in line
with the increase in dividends capped at 10%.
During 2014, contributions paid to the defined benefit pension
schemes were GBP18.2 million. In December 2014, the Group pre paid
deficit funding contributions of GBP16.5 million in respect of 2015
and GBP0.5 million in respect of 2016 and other contributions of
GBP1.2 million. Payments were GBP9.2 million (2013: GBP11.6
million) to the Past Service Scheme, GBP3.7 million (2013: GBP4.0
million) to the MGN Scheme, GBP2.7 million (2013: GBP1.0 million)
to the Trinity Scheme, GBP2.6 million (2013: GBP1.6 million) to the
MIN Scheme and GBPnil (2013: GBP0.8 million) to the smaller
schemes. During 2013, contributions paid to the defined benefit
pension schemes amounted to GBP19.0 million being GBP9.9 million in
respect of the agreed 2013 payments and an accelerated payment of
GBP9.1 million in respect of the agreed 2014 payments.
Risks
Valuations for funding and accounting purposes are based on
assumptions about future economic and demographic variables. This
results in risk of a volatile valuation deficit, and the risk that
the ultimate cost of paying benefits is higher than the current
assessed liability value.
The main sources of risk are:
-- Investment risk: a reduction in asset returns (or assumed future asset returns);
-- Inflation risk: an increase in benefit increases (or assumed future increases); and
-- Longevity risk: an increase in average life spans (or assumed life expectancy).
These risks are managed by:
-- Investing in insured annuity policies: the income from these
policies exactly matches the benefit payments for the members
covered, removing all of the above risks. At the reporting date the
insured annuity policies covered 20% of total liabilities;
-- Investing a proportion of assets in government and corporate
bonds: changes in the values of the bonds broadly match changes in
the values of the uninsured liabilities, reducing the investment
risk. At the reporting date this amounted to 32% of assets
excluding the insured annuity policies;
-- Investing a proportion in equities: with the aim of achieving
outperformance and so reducing the deficits over the long term. At
the reporting date this amounted to 55% of assets excluding the
insured annuity policies; and
-- The gradual sale of equities over time to purchase additional
annuity policies or bonds: to further reduce risk as the schemes,
which are closed to future accrual, mature.
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
13. Retirement benefit schemes (continued)
Defined benefit pension schemes (continued)
The Group is not exposed to any unusual, entity specific or
scheme specific risks. There were no plan amendments, settlements
or curtailments in 2013 which resulted in a pension cost.
Actuarial projections at the reporting date showed removal of
the accounting deficit by 2023 due to scheduled contributions and
asset outperformance over assumed investment returns.
Results
For the purposes of the Group's consolidated financial
statements, valuations have been performed in accordance with the
requirements of IAS 19 with scheme liabilities calculated using a
consistent projected unit valuation method and compared to the
value of the scheme assets at 31 December 2014, the day closest to
the reporting date for which such values were available.
The assets and liabilities of the principal schemes as at the
reporting date are:
Old Scheme/Past
Service Scheme MGN Scheme Trinity Scheme MIN Scheme
GBPm GBPm GBPm GBPm
------------------------------------ --------------- ------------ ---------------- ------------
Present value of uninsured scheme
liabilities (606.7) (487.8) (304.0) (93.9)
Present value of insured scheme
liabilities (186.4) - (79.3) (105.1)
------------------------------------ --------------- ------------ ---------------- ------------
Total present value of scheme
liabilities (793.1) (487.8) (383.3) (199.0)
------------------------------------ --------------- ------------ ---------------- ------------
Invested and cash assets at
fair value 405.3 397.2 320.1 66.9
Value of liability matching
insurance contracts 186.4 - 79.3 105.1
------------------------------------ --------------- ------------ ---------------- ------------
Total value of scheme assets 591.7 397.2 399.4 172.0
------------------------------------ --------------- ------------ ---------------- ------------
Net scheme (deficit)/surplus (201.4) (90.6) 16.1 (27.0)
------------------------------------ --------------- ------------ ---------------- ------------
Based on actuarial advice, the assumptions used in calculating
the scheme liabilities and the actuarial value of those liabilities
are:
2014 2013
-------------------------------------------------- ----- -----
Financial assumptions (nominal % pa)
Discount rate 3.70 4.40
Retail price inflation rate 3.05 3.35
Consumer price inflation rate 1.85 2.35
Rate of pension increase in deferment 1.85 2.35
Rate of pension increases in payment 3.85 3.95
--------------------------------------------------- ----- -----
Mortality assumptions - future life expectancies
from age 65 (years)
Male currently aged 65 22.0 22.3
Female currently aged 65 23.9 24.4
Male currently aged 55 22.8 23.1
Female currently aged 55 24.8 25.4
--------------------------------------------------- ----- -----
The estimated impact on the IAS 19 liabilities and on the IAS 19
deficit at the reporting date, due to a reasonably possible change
in key assumptions over the next year, are set out in the table
below:
Effect on Effect on
liabilities deficit
GBPm GBPm
--------------------------------------------- ------------ ---------
Discount rate+/- 0.5% pa -135/+148 -121/+133
Retail price inflation rate +/- 0.5% pa +25/-25 +18/-18
Consumer price inflation rate +/- 0.5% pa +43/-41 +43/-41
Life expectancy at age 65 +/- 1 year +71/-69 +64/-62
--------------------------------------------- ------------ ---------
The effect on the deficit is lower than the effect on the
liabilities due to the matching impact on the value of the
insurance contracts held in respect of some of the liabilities.
Each assumption variation represents a reasonably possible change
in the assumption over the next year but might not represent the
actual effect because assumption changes are unlikely to happen in
isolation.
The estimated impact of the assumption variations make no
allowance for changes in the values of invested assets that would
arise if market conditions were to change in order to give rise to
the assumption variation. If allowance were made, the estimated
impact would likely be lower as the values of invested assets would
normally change.
The amount included in the consolidated income statement,
consolidated statement of comprehensive income and consolidated
balance sheet arising from the Group's obligations in respect of
its defined benefit pension schemes is as follows:
2014 2013
Consolidated income statement GBPm GBPm
------------------------------------------- ------- -------
Pension scheme administrative expenses (3.2) (2.8)
Pension scheme finance charge (11.2) (13.2)
-------------------------------------------- ------- -------
Defined benefit cost recognised in income
statement (14.4) (16.0)
-------------------------------------------- ------- -------
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
13. Retirement benefit schemes (continued)
Defined benefit pension schemes (continued)
Consolidated statement of comprehensive 2014 2013
income GBPm GBPm
------------------------------------------------- ------- -------
Actuarial loss due to liability experience (7.9) (11.8)
Actuarial loss due to liability assumption
changes (90.6) (15.4)
-------------------------------------------------- ------- -------
Total liability actuarial loss (98.5) (27.2)
Returns on scheme assets greater than discount
rate 45.7 69.7
Total (loss)/gain recognised in statement
of comprehensive income (52.8) 42.5
-------------------------------------------------- ------- -------
Consolidated balance sheet
2014 2013
GBPm GBPm
------------------------------------------------- ---------- ----------
Present value of uninsured scheme liabilities (1,492.4) (1,392.0)
Present value of insured scheme liabilities (370.8) (424.1)
-------------------------------------------------- ---------- ----------
Total present value of scheme liabilities (1,863.2) (1,816.1)
-------------------------------------------------- ---------- ----------
Invested and cash assets at fair value 1,191.2 1,139.8
Value of liability matching insurance contracts 370.8 424.1
-------------------------------------------------- ---------- ----------
Total value of scheme assets 1,562.0 1,563.9
-------------------------------------------------- ---------- ----------
Net scheme deficit (301.2) (252.2)
-------------------------------------------------- ---------- ----------
Non-current assets - retirement benefit
assets 17.8 15.7
Non-current liabilities - retirement benefit
obligations (319.0) (267.9)
-------------------------------------------------- ---------- ----------
Net scheme deficit (301.2) (252.2)
-------------------------------------------------- ---------- ----------
Net scheme deficit included in consolidated
balance sheet (301.2) (252.2)
Deferred tax included in consolidated balance
sheet 60.2 50.4
-------------------------------------------------- ---------- ----------
Net scheme deficit after deferred tax (241.0) (201.8)
-------------------------------------------------- ---------- ----------
Movement in net scheme deficit
2014 2013
GBPm GBPm
----------------------------------------- -------- --------
Opening net scheme deficit (252.2) (297.7)
Contributions 18.2 19.0
Consolidated income statement (14.4) (16.0)
Consolidated statement of comprehensive
income (52.8) 42.5
------------------------------------------ -------- --------
Closing net scheme deficit (301.2) (252.2)
------------------------------------------ -------- --------
Changes in the present value of scheme liabilities
2014 2013
GBPm GBPm
----------------------------------------------------- --------- ---------
Opening present value of scheme liabilities (1,816.1) (1,803.6)
Interest cost (76.5) (79.4)
Actuarial loss - experience (7.9) (11.8)
Actuarial gain - change to demographic assumptions 41.6 59.0
Actuarial loss - change to financial assumptions (132.2) (74.4)
Benefits paid 79.7 82.7
Buy-out 48.2 11.4
Closing present value of scheme liabilities (1,863.2) (1,816.1)
------------------------------------------------------ --------- ---------
2014 2013
Changes in the fair value of scheme assets GBPm GBPm
------------------------------------------------ ------- -------
Opening fair value of scheme assets 1,563.9 1,505.9
Interest income 65.3 66.2
Actual return on assets greater than discount
rate 45.7 69.7
Contributions by employer 18.2 19.0
Benefits paid (79.7) (82.7)
Administrative expenses (3.2) (2.8)
Buy-out (48.2) (11.4)
Closing fair value of scheme assets 1,562.0 1,563.9
------------------------------------------------- ------- -------
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (52 weeks ended 29
December 2013)
13. Retirement benefit schemes (continued)
Defined benefit pension schemes (continued)
Fair value of scheme assets
2014 2013
GBPm GBPm
-------------------------------------------------- ------- -------
UK equities 219.6 223.7
US equities 189.3 159.0
Other overseas equities 251.2 230.3
Property 26.8 28.2
Corporate bonds 248.7 264.7
Fixed interest gilts 56.3 63.9
Index linked gilts 79.0 67.4
Cash and other 120.3 102.6
--------------------------------------------------- ------- -------
Invested and cash assets at fair value 1,191.2 1,139.8
Value of liability matching insurance contracts 370.8 424.1
--------------------------------------------------- ------- -------
Fair value of scheme assets 1,562.0 1,563.9
--------------------------------------------------- ------- -------
All of the scheme assets have quoted prices in active markets.
Scheme assets include neither direct investments in the Company's
ordinary shares nor any property assets occupied nor other assets
used by the Group.
14. Provisions
Share-based
Payments Property Restructuring Other Total
GBPm GBPm GBPm GBPm GBPm
------------------------------ ------------ ----------- ---------------- -------- --------
At 29 December 2013 (3.7) (11.0) (3.4) (6.0) (24.1)
Released/(charged) to income
statement 1.5 (1.1) (14.0) (12.7) (26.3)
Utilisation of provision 0.8 3.1 13.8 2.5 20.2
------------------------------ ------------ ----------- ---------------- -------- --------
At 28 December 2014 (1.4) (9.0) (3.6) (16.2) (30.2)
------------------------------ ------------ ----------- ---------------- -------- --------
The provisions have been analysed between current and
non-current as follows:
2014 2013
GBPm GBPm
------------- ------- -------
Current (23.3) (10.3)
Non-current (6.9) (13.8)
-------------- ------- -------
(30.2) (24.1)
------------- ------- -------
The share-based payments provision relates to National Insurance
obligations attached to the future crystallisation of awards.
The property provision relates to onerous property leases and
future committed costs related to occupied, let and vacant
properties. This provision will be utilised over the remaining term
of the leases.
The restructuring provision relates to restructuring charges
incurred in the delivery of cost reduction measures. This provision
is expected to be utilised within the next year.
The other provision relates to legal and other costs relating to
historical litigation and other matters.
15. Share capital and reserves
The share capital comprises 257,690,520 allotted, called-up and
fully paid ordinary shares of 10p each. The share premium account
reflects the premium on issued ordinary shares. The Group obtained
court approval at the end of April 2014 for a reduction in the
share premium account of GBP514.8 million to eliminate the deficit
on the Company's profit and loss account reserve. Profit generated
by the Company after 30 April 2014 is available for distribution to
shareholders.
The capital redemption reserve represents the nominal value of
the shares purchased and subsequently cancelled under share
buy-back programmes. Cumulative goodwill written off to retained
earnings and other reserves in respect of continuing businesses
acquired prior to 1998 is GBP25.9 million (2013: GBP25.9 million).
On transition to IFRS, the revalued amounts of freehold properties
were deemed to be the cost of the asset and the revaluation reserve
has been transferred to retained earnings and other reserves.
Shares purchased by the Trinity Mirror Employee Benefit Trust
(the 'Trust') are included in retained earnings and other reserves
at GBP11.4 million (2013: GBP13.4 million). During the period the
Trust purchased 1,391,620 shares (2013: 2,600,000) for a cash
consideration of GBP2.2 million (2013: GBP3.0 million). The Trust
received a payment of GBP2.2 million (2013: GBP3.0 million) from
the Company to purchase these shares. During the period, 3,408,484
shares were released to senior managers relating to grants made in
prior years (2013: 1,652,091).
During the period 935,709 awards were granted to senior managers
on a discretionary basis under the Long Term Incentive Plan (2013:
2,458,487). The exercise price of the granted awards is GBP1 for
each block of awards granted. The awards vest after three years,
subject to the continued employment of the participant and
satisfaction of certain performance conditions and are required to
be held for a further two years. During the period 96,245 awards
were granted to senior managers under the Restricted Share Plan
(2013: nil). The awards vest after three years, subject to the
continued employment of the participant.
Notes to the consolidated financial statements
for the 52 weeks ended 28 December 2014 (and 52 weeks ended 29
December 2013)
16. Reconciliation of statutory results to adjusted results
52 weeks ended 28 December 2014
Non-recurring
items Pension Restructuringcharges Finance Tax
Statutory (a) Amortisation charges (d) costs items Adjusted
results GBPm (b) (c) GBPm (e) (f) results
GBPm GBPm GBPm GBPm GBPm GBPm
----------- ------------- ---------------- ---------------- ----------- ------------------------ --------- --------- ------------
Revenue 636.3 - - - - - - 636.3
Operating
profit 98.6 (15.2) 4.9 3.2 14.0 - - 105.5
Profit
before
tax 81.6 (15.2) 4.9 14.4 14.0 2.6 - 102.3
Profit
after
tax 69.8 (17.6) 4.5 11.5 11.0 2.1 - 81.3
Basic EPS
(p) 28.1 (6.9) 1.8 4.6 4.4 0.8 - 32.8
----------- ------------- ---------------- ---------------- ----------- ------------------------ --------- --------- ------------
52 weeks ended 29 December 2013
Non-recurring
items Pension Restructuring Finance Tax
Statutory (a) Amortisation charges charges costs items Adjusted
results GBPm (b) (c) (d) (e) (f) results
GBPm GBPm GBPm GBPm GBPm GBPm GBPm
--------------- ------------- ---------------- ---------------- ----------- ----------------- --------- --------- ------------
Revenue 663.8 - - - - - - 663.8
Operating
(loss)/profit (134.8) 224.9 5.2 2.8 9.9 - - 108.0
(Loss)/profit
before tax (160.8) 224.9 5.2 16.0 9.9 6.1 - 101.3
(Loss)/profit
after tax (96.4) 180.6 4.8 12.8 7.6 4.9 (35.2) 79.1
Basic
(LPS)/EPS
(p) (39.0) 73.0 1.9 5.2 3.1 2.0 (14.2) 32.0
--------------- ------------- ---------------- ---------------- ----------- ----------------- --------- --------- ------------
(a) Non-recurring items relate to the items charged or credited
to operating profit as set out in note 5.
(b) Amortisation of the Group's other intangible assets and
amortisation included in share of results of associates.
(c) Pension finance charge and pension administrative expenses
relating to the defined benefit pension schemes as set out in note
13.
(d) Restructuring charges in respect of cost reduction measures as set out in note 14.
(e) Impact of the translation of foreign currency borrowings and
fair value changes on derivative financial instruments as set out
in note 7.
(f) Tax items relate to the impact of tax legislation changes
due to the change in the corporation tax rate on the opening
deferred tax position and prior year tax adjustments included in
the taxation charge or credit as set out in note 8.
17. Contingent liabilities
There is potential for further liabilities to arise from the
outcome or resolution of the ongoing historical legal issues. Due
to the present uncertainty in respect of the nature, timing or
measurement of any such liabilities it is too soon to be able to
reliably estimate how these matters will proceed and their
financial impact.
This information is provided by RNS
The company news service from the London Stock Exchange
END
FR UGUAWWUPAGRG
Reach (LSE:RCH)
Historical Stock Chart
From Apr 2024 to May 2024
Reach (LSE:RCH)
Historical Stock Chart
From May 2023 to May 2024