Preliminary Results -6-
November 30 2011 - 2:01AM
UK Regulatory
Currency translation differences - - (0.5) - (0.5)
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Total other comprehensive income - - 1.7 7.9 9.6
Total comprehensive income - - 1.7 (60.7) (59.0)
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Transactions with owners
Share-based payments - - - 0.7 0.7
Balance at 31 July 2011 0.3 27.9 12.1 (54.6) (14.3)
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(1) Reclassification relates to a correction of the other
reserves that were previously included in retained earnings.
Notes to the condensed preliminary financial statements
(audited)
For the year ended 31 July 2011 continued
1 Basis of preparation
This condensed preliminary financial information, which is
audited for the year ended 31 July 2011, has been extracted from
the Annual Report and prepared in accordance with the Disclosure
and Transparency Rules of the Financial Services Authority. It has
also been prepared in accordance with the accounting policies the
Group is adopting in its 2011 Annual Report and unless stated are
consistent with those adopted in the consolidated financial
statements for the year ended 31 July 2010. These accounting
policies are based on the EU-adopted International Financial
Reporting Standards (IFRS's) and International Reporting
Interpretations Committee (IFRIC) interpretations adopted by the
Group for the year ended 31 July 2011.
This condensed preliminary financial information does not
constitute statutory financial statements as defined in Section 434
of the Companies Act 2006. Comparative figures for the year ended
31 July 2010 have been extracted from the Group Report and
Accounts, on which the auditors gave an unqualified audit opinion
which included an emphasis of matter and did not include a
statement under section 498 of the Companies Act 2006. The Group
Report and Accounts for the year ended 31 July 2010 have been filed
with the Registrar of Companies.
The condensed preliminary financial information has been
prepared under the historical cost convention except for the
following items: share options, cash flow hedges and retirement
benefit obligations are fair valued.
The financial statements have been prepared on a going concern
basis.
In determining that this is an appropriate basis for preparing
the financial statements, the directors have had regard to the
factors affecting the future development, performance and financial
position of the Group including its cash flows, liquidity position,
borrowing facilities and the risks and uncertainties relating to
its business activities.
The current restriction set out in the Company's Articles of
Association relating to the borrowing powers of the Group is no
longer appropriate. The directors are requesting a sanction from
the shareholders, by way of ordinary resolution of the Company, to
vary the Company's borrowing limit by introducing a specified
maximum borrowing limit. The directors have considered the
possibility of the shareholders not approving the resolution and
consider this possibility to be remote. If not approved then the
Company cannot fully access the revised facilities and would be
required to repay its borrowings which it would be unable to
do.
Subsequent to the year end the Group renegotiated its banking
facilities. As part of the renegotiation, careful consideration has
been given to the budgeting and ongoing cash management within the
business which have been subject to extensive internal and external
review. This has included a review of customer and supplier terms
of business. Notwithstanding the current economic climate, the
directors are therefore satisfied that sufficient headroom exists
within the new facilities.
After considering these factors, the directors have a reasonable
expectation 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 financial statements.
The audit report is unqualified in this respect.
As disclosed in Note 3, the directors have considered the
recoverability of the Group's exposure at 31 July 2011 of AED 72.5m
(GBP12.0m) on the BPR contract in Abu Dhabi. The unqualified audit
report included an emphasis of matter in relation to this
exposure.
Changes in accounting policies
No new accounting standards having a material impact on the
Group were mandatory for the financial year ended 31 July 2011.
The following new standards, amendments to standards and
interpretations are mandatory for the first time for the financial
year ended 31 July 2011, but do not have a material impact on the
Group's results.
IFRS1 (amendment), 'First-time Adoption of International
Financial Reporting Standards' - additional exemptions and
financial instrument disclosures
IFRS2 (amendment), 'Share-based payment' - Group cash-settled
share-based payment transactions
IAS32 (amendment), 'Financial instruments: Presentation' -
classification of rights issues
IFRS IC15, 'Arrangements for construction of real estates'
IFRS IC19, 'Extinguishing financial liabilities with equity
instruments'
2 Segmental analysis
Business segments
The Group's operations are organised and managed separately,
according to the nature of products and services provided.
The Executive Directors assess the performance of the operating
segments based on a measure of adjusted earnings before interest,
tax and amortisation ('Underlying operating profit'). This
measurement basis also excludes exceptional items from the
operating segments, such as restructuring costs and impairments
when the impairment is the result of an isolated, non-recurring
event. Interest income and finance costs are not included in the
result for each operating segment.
Analysis of results by business segment is as follows:
Government
and Business Management Regulated Total
Highways Services Consulting Industries Group
2011 GBPm GBPm GBPm GBPm GBPm
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Underlying revenue 205.6 218.5 33.0 82.5 539.6
Exceptional revenue - - 11.8 - 11.8
Total Revenue 205.6 218.5 44.8 82.5 551.4
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Underlying operating profit 4.5 7.4 1.8 2.0 15.7
Restructuring costs and asset impairment
charges (2.2) 1.3 (0.6) (2.7) (4.2)
Other exceptional items - 1.9 (3.9) (1.0) (3.0)
Amortisation of intangible assets arising
from business combinations (2.2) (1.3) (2.5) (0.4) (6.4)
Impairment of goodwill and intangible
assets arising on business combinations - - (41.3) (4.0) (45.3)
Segment operating profit/(loss) 0.1 9.3 (46.5) (6.1) (43.2)
Other Group exceptionals (3.7)
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Operating loss (46.9)
Interest receivable 1.1
Finance costs (19.0)
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Loss before tax (64.8)
Taxation (3.8)
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Loss for the year (68.6)
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Assets by segment
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Goodwill and other intangibles 29.6 59.8 12.6 13.0 115.0
Trade and other receivables 33.9 23.0 16.5 29.2 102.6
Other segment assets 7.3 17.5 1.2 5.3 31.3
Unallocated assets:
- deferred tax assets 14.3
- cash 47.3
Total assets 310.5
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Liabilities by segment
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