RNS Number:7466B
Management Consulting Group PLC
09 August 2004
Financial results for the six months ended 30 June 2004
Management Consulting Group PLC ("MCG" or "the Group"), the international
management consultancy group, today announces its results for the six months
ended 30 June 2004.
Key points
* Turnover up 45% to #62.9 million (30 June 2003: #43.3 million)
* Operating profit before goodwill amortisation of #7.5 million (30 June
2003: loss of #1.0 million)
* Profit before tax of #5.7 million (30 June 2003: loss of #2.8 million)
* Net cash of #12.4 million (31 December 2003: #9.7 million)
* Earnings per share before goodwill amortisation of 3.0 pence (30 June
2003: loss of 0.8 pence), basic earnings per share of 2.0 pence (30 June
2003: loss of 1.9 pence)
* Significant improvements in both Proudfoot Consulting and Parson
Consulting
* Parson Consulting reports first profits since acquisition, before
goodwill amortisation
* Continuing investment in both businesses
* Order books for both Proudfoot Consulting and Parson Consulting well
ahead of the same time last year
Rolf Stomberg, Chairman:
"Our businesses have shown excellent performance in the first half of 2004 with
a strong return to profitability. The performance of Parson Consulting is
particularly pleasing, underlining the successful turn-around of the business
since we acquired it in May 2002."
Kevin Parry, Chief Executive:
"Our strategy of continual reinvestment in the businesses has delivered
excellent growth in the first half. We will continue to invest in both the
geographical reach and the breadth of our services to deliver sustainable
progress in future periods."
For further information please contact:
Management Consulting Group PLC
Kevin Parry Chief Executive 020 7832 3700
Stephen Purse Finance Director 020 7832 3700
The Maitland Consultancy
Suzanne Bartch 020 7379 5151 (mobile) 07769 710335
Michelle Jeffery 020 7379 5151 (mobile) 07989 977837
Notes to Editors
Management Consulting Group PLC (www.mcgplc.com), the international management
consultancy group, comprises two businesses, Proudfoot Consulting and Parson
Consulting.
Proudfoot Consulting is a specialist consultancy which implements sustainable
operational improvements in sales, costs, overheads, major capital expenditure
projects and production output, typically at no net annualised cost to its
clients. Its clients include BellSouth, BP, Caterpillar, Citibank, Kimberly
Clark and Rio Tinto.
Parson Consulting is a financial management consultancy that improves the
accuracy, speed and efficiency of finance and support functions free of auditing
conflicts of interest. Its clients include Ameriquest, Avis, Kingfisher, Lawson
Software, Tomkins and Warner Bros.
Management statement
The results for the six months ended 30 June 2004 show significant improvements
in both Proudfoot Consulting and Parson Consulting. For the first time, Parson
Consulting reported an operating profit before goodwill amortisation for the
period, reflecting the turn-around of the business. The results are summarised
as follows:
unaudited unaudited audited
six months six months year
ended ended ended
30 June 2004 30 June 2003 31 Dec 2003
#'000 #'000 #'000
Revenue
Proudfoot 46,831 33,770 68,238
Parson 16,108 9,528 20,411
---------- ---------- ----------
62,939 43,298 88,649
---------- ---------- ----------
Operating profit/(loss) before
goodwill amortisation
Proudfoot 6,890 2,260 4,519
Parson 615 (3,234) (4,310)
---------- ---------- ----------
7,505 (974) 209
---------- ---------- ----------
Group results
Overall turnover for the six months ended 30 June 2004 was #62.9 million (six
months ended 30 June 2003: #43.3 million; six months ended 31 December 2003:
#45.3 million).
The 45% improvement in turnover compared with the same period last year reflects
a general improvement in North American economic conditions. In addition, there
was increased demand from the telecommunications and financial sectors, and
Parson Consulting benefited from work associated with the Sarbanes-Oxley Act in
the United States.
In the period, 67% of turnover was attributable to North America (six months
ended 30 June 2003: 61%). Reported North American revenues grew by 59% compared
to the corresponding period of 2003. The US dollar was weaker relative to
Sterling, and after adjusting for the impact of this, the underlying revenue
growth in US dollars was approximately 70%.
The Group's gross margin continued to be well managed and was 50% (2003: 49%) of
turnover. This was due to the normal tight control of the costs of delivery. In
addition, in Parson Consulting, which is of increasing significance to the
Group, there was an improvement in prices.
In 2003 we took the decision not to reduce the headcount of our sales force as
to have done so would have not permitted the improvement in business experienced
in 2004. Accordingly, although turnover increased significantly in the first
half of 2004, selling expenses increased by just #0.6 million and represented
24% of turnover (2003: 33%). Selling costs as a proportion of turnover are now
at a more normal level with the absolute increase in costs reflecting higher
performance bonuses.
Administration expenses, excluding goodwill of #1.9 million (2003: #2.0
million), were #8.5 million (2003: #7.5 million). Costs were tightly managed and
the increase reflects higher performance bonuses than in the corresponding
period.
The very high operational gearing in the Group has resulted in an operating
profit before goodwill amortisation of #7.5 million (2003: loss of #1.0
million). After goodwill amortisation the operating profit was #5.6 million
(2003: loss of #3.0 million). EBITDA was #8.1 million (2003: loss of #0.3
million).
The tax charge of #2.0 million (2003: #0.7 million) represents mainly tax
payable in countries where the relevant subsidiary company does not have
sufficient brought forward tax losses to offset profits earned in the period.
Proudfoot Consulting
Proudfoot Consulting's turnover was #46.8 million (2003: #33.8 million). Its
North American revenue increased by 61%, following the momentum that we started
to observe at the end of last year. Pleasingly, there was also a 15% improvement
in European revenue. The improvement in Europe was most evident in the United
Kingdom with conditions in continental Europe remaining challenging. Revenue
from the rest of the world was little changed.
To service the increased level of business, we recruited additional consultants,
primarily in North America. The availability of consultants remains good due to
the difficult last three years for the consulting market. There is little
apparent salary inflation in the marketplace.
The high operational gearing in the business resulted in a significant
improvement in operating profit before goodwill amortisation from #2.3 million
in the six months ended 30 June 2003 to #6.9 million in the first half of this
year.
In South Africa, we are increasingly undertaking projects in partnership with
black empowered consulting organisations to reflect the emphasis being put by
clients on engaging consultants that reflect the demographic make-up of the
country. Over time, we anticipate that the current project by project
arrangements will become more formalised which will allow our business to
develop faster in South Africa.
We continue to seek opportunities to expand into new markets. In July, we
separated out the Chinese business from the remainder of our Asia Pacific
business to reflect increasing client interest in doing business in China and
the significant cultural differences compared with the Australian and New
Zealand business. The investment cost is modest because the administration
functions can be absorbed by our existing infrastructure.
The current order book is 35% ahead of the same time last year with a number of
orders extending into 2005.
Parson Consulting
Parson Consulting has now been owned for just over two years. The business has
continued to make excellent progress from the monthly breakeven position first
achieved in November 2003.
This is the first period for which Parson Consulting has contributed to the
Group's profits, achieving a profit before goodwill amortisation of #0.6 million
(2003: loss of #3.2 million).
North American revenue grew 56% with approximately an even split between work
related to control assessments required by the Sarbanes-Oxley Act and other
financial management services. In addition, the UK based operations contributed
#1.8 million (2003: #0.4 million) of revenue largely unrelated to
Sarbanes-Oxley. This strong growth has allowed us to increase the speed of
investment in senior personnel and required significant recruitment of delivery
consultants.
The outlook for Sarbanes-Oxley control assessment work remains strong as a
result of companies increasingly recognising the amount of work required to
comply with the legislation and a widening of the interpretation of the Act's
requirements. In addition, smaller companies and non-domestic SEC registrants
have a further year in which to comply with the Act and many companies not
registered with the SEC are voluntarily seeking to comply with the standards or
are being encouraged to comply by their bankers. Following on from initial work
resulting from the introduction of the Act, there will be continuing compliance
requirements for all companies.
We are launching a number of new financial management services to enable us to
build upon the client relationships which we have established through the
control assessment work. Parson Consulting should also benefit from the fact
that the Big Four accounting firms may be prevented from providing such services
to their audit clients. In addition, the UK's Financial Reporting Council has
announced a review of the continued appropriateness of the Turnbull guidance on
internal control and risk management in the light of the international
developments and this may lead to further new opportunities for Parson.
The current order book is well over twice the level of the same time last year.
Earnings per share
The basic earnings per share for the six months was 2.0 pence compared with a
loss of 1.9 pence per share in the corresponding period. Headline earnings per
share, before goodwill amortisation, was 3.0 pence (2003: loss of 0.8 pence).
Dividend
As indicated previously, it is our policy to pay only one dividend a year, after
the declaration of the annual results. Accordingly, no interim dividend is being
declared.
Balance sheet
The Group's cash balance increased from #9.7 million at 31 December 2003 to
#12.4 million at 30 June 2004. Deferred consideration of #1.1 million was paid
during the period, which completes our obligations in relation to acquisitions
in prior years.
The deficit related to the closed defined benefit pension and medical plans has
decreased to #12.5 million from #13.2 million at 31 December 2003, despite more
conservative actuarial assumptions. This reflects funding of the pension deficit
during the year and the return on the scheme's assets which was higher than the
benchmark return.
People
The board welcomes our new recruits to the Group and thanks both them and our
longer serving employees for their commitment to our clients and the Group.
Outlook
As noted in previous reports, the second half performance is seasonally weaker
than the first half due to fewer working days and the slow down in order intake
in the third quarter as a result of the holiday season in Europe. However, the
order books in both businesses are significantly better than at the same time a
year ago which points to good progress in the second half compared with the
corresponding period of last year.
The trading improvements in both Proudfoot Consulting and Parson Consulting are
enabling us to invest further in new services and new markets and we expect this
investment to start showing returns in the next financial year.
R W H Stomberg
Chairman
K A H Parry
Chief Executive
9 August 2004
Group profit and loss account
six months ended 30 June 2004
unaudited unaudited audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
Note #'000 #'000 #'000
Turnover 2 62,939 43,298 88,649
Cost of sales (31,771) (22,256) (45,137)
--------- --------- --------
Gross profit 31,168 21,042 43,512
Selling costs (15,121) (14,473) (28,303)
Administrative expenses
Excluding goodwill amortisation (8,542) (7,543) (15,000)
Goodwill amortisation (1,893) (2,021) (4,029)
--------- --------- --------
Total administrative expenses (10,435) (9,564) (19,029)
--------- --------- --------
Operating profit/(loss):
Before goodwill amortisation 7,505 (974) 209
After goodwill amortisation 5,612 (2,995) (3,820)
--------- --------- --------
Total operating profit/(loss) and
profit/(loss) on ordinary activities
before finance income/(costs) 2 5,612 (2,995) (3,820)
Finance income/(costs) 68 176 (46)
--------- --------- --------
Profit/(loss) on ordinary activities
before taxation 2 5,680 (2,819) (3,866)
Tax on profit/(loss) on ordinary
activities 3 (1,980) (706) (1,062)
--------- --------- --------
Profit/(loss) on ordinary activities
after taxation 3,700 (3,525) (4,928)
Equity dividends proposed - - (944)
--------- --------- --------
Retained profit/(loss) for the
financial period/year 3,700 (3,525) (5,872)
--------- --------- --------
Earnings/(loss) per share - pence 5
Basic 2.0 (1.9) (2.7)
Diluted 2.0 (1.9) (2.7)
Headline 3.0 (0.8) (0.5)
--------- --------- --------
Group statement of total recognised gains and losses
six months ended 30 June 2004
unaudited unaudited audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
Note #'000 #'000 #'000
Profit/(loss) for the period/year 3,700 (3,525) (4,928)
Actuarial (loss)/gain relating to
retirement benefit schemes 14 (422) (1,824) 285
Currency translation differences on
foreign currency net investments (2,496) 944 250
--------- --------- --------
Total recognised gains and losses
since the last Annual Report 782 (4,405) (4,393)
--------- --------- --------
Group balance sheet
at 30 June 2004
unaudited unaudited audited
30 June 30 June 31 Dec
2004 2003 2003
(restated)
Note #'000 #'000 #'000
Fixed assets
Intangible assets 6 64,890 73,434 69,206
Tangible assets 1,908 1,886 1,649
---------- --------- --------
66,798 75,320 70,855
---------- --------- --------
Current assets
Debtors 7 14,564 9,762 7,910
Cash at bank and in hand and deposits 12,384 9,553 9,738
---------- --------- --------
26,948 19,315 17,648
Creditors: amounts falling due within
one year 8 (30,595) (22,781) (24,015)
---------- --------- --------
Net current liabilities (3,647) (3,466) (6,367)
---------- --------- --------
Total assets less current liabilities 63,151 71,854 64,488
Creditors: amounts falling due after
more than one year 9 (3,212) (3,929) (3,387)
Provisions for liabilities and charges (2,397) (2,678) (3,180)
---------- --------- --------
Net assets excluding retirement
benefits liability 57,542 65,247 57,921
Retirement benefits liability 14 (12,507) (18,491) (13,213)
---------- --------- --------
Net assets including retirement
benefits liability 45,035 46,756 44,708
---------- --------- --------
Capital and reserves
Called up share capital 47,256 47,198 47,198
Share premium account 38,026 38,009 38,009
Shares to be issued 1,636 3,282 2,166
Own shares held by employee share trust 1 (970) (970) (970)
Other reserves (2,087) 1,103 409
Profit and loss account (38,826) (41,866) (42,104)
---------- --------- --------
Shareholders' funds - equity 10 45,035 46,756 44,708
---------- --------- --------
Group cash flow statement
six months ended 30 June 2004
unaudited unaudited audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
Note #'000 #'000 #'000
Net cash inflow/(outflow) from
operating activities 11 7,808 (5,935) (4,957)
Returns on investment and servicing
of finance
Interest received 109 153 247
Interest paid - - -
---------- --------- --------
Net cash inflow from returns on
investments and servicing of finance 109 153 247
Taxation (2,352) (544) (553)
Capital expenditure and financial
investment
Purchase of tangible fixed assets (842) (50) (594)
Proceeds from sale of tangible fixed assets - - 205
---------- --------- --------
Net cash outflow from capital
expenditure and financial investment (842) (50) (389)
Acquisitions and disposals
Payments to acquire subsidiary undertakings (1,074) (4,984) (5,189)
---------- --------- --------
Net cash outflow from acquisitions
and disposals (1,074) (4,984) (5,189)
Equity dividends paid (925) (911) (911)
---------- --------- --------
Cash inflow/(outflow) before use of
liquid resources and financing 2,724 (12,271) (11,752)
Financing
Net proceeds from issue of ordinary
shares 48 - -
---------- --------- --------
Net cash inflow from financing 48 - -
Increase/(decrease) in cash in the
period/year 12,13 2,772 (12,271) (11,752)
---------- --------- --------
Notes
1. Basis of presentation
The interim financial statements have been prepared in accordance with the
accounting policies set out in the annual report for the year ended 31 December
2003. The balance sheet at 30 June 2003 has been restated to take account of
UITF Abstract 38, which was issued on 15 December 2003, and which requires the
Management Consulting Group PLC ordinary shares owned by the employee share
trust to be presented as a reduction of shareholders' funds rather than as an
investment.
2.Segmental information
(a) Turnover
There is no material difference between turnover by geographical destination and
turnover by geographical origin. The analysis of turnover by geographical
destination is as follows:
unaudited unaudited audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
#'000 #'000 #'000
Continuing operations
North America 42,282 26,512 54,457
Europe 15,853 12,467 24,650
Africa 1,643 2,128 4,698
Asia Pacific 3,161 2,191 4,844
---------- -------- ---------
62,939 43,298 88,649
---------- -------- ---------
(b) Profit/(loss) before taxation
The analysis of the profit/(loss) by geographical region is as follows:
unaudited unaudited audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
#'000 #'000 #'000
North America 7,201 (525) 2,736
Europe (1,341) (2,544) (6,899)
Africa (555) (21) 25
Asia Pacific 307 95 318
---------- -------- ---------
Total operating profit/(loss) 5,612 (2,995) (3,820)
Finance income/(costs) 68 176 (46)
---------- -------- ---------
Group profit/(loss) on ordinary activities
before taxation 5,680 (2,819) (3,866)
---------- -------- ---------
3. Taxation
The Group is tax paying in certain jurisdictions, and several jurisdictions
apply minimum levels of taxation. The tax charge for the six months ended 30
June 2004 reflects such taxes. In other jurisdictions there are unrelieved
losses.
4. Earnings before interest, tax, depreciation and amortisation
unaudited unaudited audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
#'000 #'000 #'000
Operating profit/(loss) 5,612 (2,995) (3,820)
Depreciation 556 635 1,223
Amortisation of goodwill 1,893 2,021 4,029
---------- -------- ---------
EBITDA 8,061 (339) 1,432
---------- -------- ---------
5. Earnings per share
The basic earnings per share is calculated by dividing the earnings attributable
to ordinary shareholders by the weighted average number of ordinary shares in
issue during the period after deducting 3.9 million shares held by the Group in
an employee share trust.
For diluted earnings per share, the weighted average number of ordinary shares
in issue is adjusted to assume conversion of all potentially dilutive ordinary
shares. The Group's only dilutive instruments are share options granted to
employees where the exercise price is less than the average market price during
the period. Dilution is not recognised where continuing operations are loss
making.
The average share price for the six months ended 30 June 2004 was 35.3 pence (30
June 2003: 44.4 pence and 31 December 2003: 36.9 pence).
Headline earnings per share has been calculated in accordance with the
definition in the Institute of Investment Management Research ('IIMR') Statement
of Practice No. 1, 'The Definition of IIMR Headline Earnings'.
Reconciliations of the earnings and weighted average number of shares used in
the calculations are set out below:
weighted
average earnings
number of per share
Six months ended 30 June 2004 (unaudited) earnings shares amount
#'000 (million) (pence)
Basic EPS
Profit attributable to shareholders 3,700 184.9 2.00
Effect of dilutive securities
Options - 0.7 (0.01)
---------- -------- ---------
Fully diluted EPS 3,700 185.6 1.99
---------- -------- ---------
Basic EPS 3,700 184.9 2.00
Goodwill amortisation 1,893 - 1.02
---------- -------- ---------
Headline EPS 5,593 184.9 3.02
---------- -------- ---------
weighted
average earnings
number of per share
Six months ended 30 June 2003 (unaudited) earnings shares amount
#'000 (million) (pence)
Basic EPS
Loss attributable to shareholders (3,525) 182.5 (1.93)
Effect of dilutive securities
Options - - -
---------- -------- ---------
Fully diluted EPS (3,525) 182.5 (1.93)
---------- -------- ---------
Basic EPS (3,525) 182.5 (1.93)
Goodwill amortisation 2,021 - 1.11
---------- -------- ---------
Headline EPS (1,504) 182.5 (0.82)
---------- -------- ---------
weighted
average earnings
number of per share
Year ended 31 December 2003 (audited) earnings shares amount
#'000 (million) (pence)
Basic EPS
Loss attributable to shareholders (4,928) 183.7 (2.68)
Effect of dilutive securities
Options - - -
---------- -------- ---------
Fully diluted EPS (4,928) 183.7 (2.68)
---------- -------- ---------
Basic EPS (4,928) 183.7 (2.68)
Goodwill amortisation 4,029 - 2.19
---------- -------- ---------
Headline EPS (899) 183.7 (0.49)
---------- -------- ---------
6. Intangible assets
Intangible assets consist of goodwill arising on acquisitions which is being
amortised over a period of 20 years. The total amortisation charge for the
period was #1.9 million (30 June 2003: #2.0 million) of which #0.8 million (30
June 2003: #0.9 million) relates to North America and #1.1 million (30 June
2003: #1.1 million) relates to Europe.
7. Debtors
unaudited unaudited audited
30 June 30 June 31 Dec
2004 2003 2003
#'000 #'000 #'000
Trade debtors 9,065 5,710 4,482
Other debtors 1,207 827 710
Taxation recoverable 2,776 1,693 1,592
Prepayments and accrued income 1,516 1,532 1,126
---------- -------- ---------
14,564 9,762 7,910
---------- -------- ---------
8. Creditors: amounts falling due within one year
unaudited unaudited audited
30 June 30 June 31 Dec
2004 2003 2003
#'000 #'000 #'000
Trade creditors 1,271 1,670 1,424
Other creditors 20 1,062 1,052
Corporation tax 5,785 4,023 3,987
Other taxes and social security 1,455 1,235 1,838
Deferred income 2,783 1,543 1,782
Accruals 19,281 13,248 12,988
Proposed dividend - - 944
---------- -------- ---------
30,595 22,781 24,015
---------- -------- ---------
9. Creditors: amounts falling due after more than one year
unaudited unaudited audited
30 June 30 June 31 Dec
2004 2003 2003
#'000 #'000 #'000
Corporation tax 2,359 2,535 2,359
Accruals 853 1,394 1,028
---------- -------- ---------
3,212 3,929 3,387
---------- -------- ---------
10. Reconciliation of movements in equity shareholders' funds
unaudited unaudited audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
(restated)
#'000 #'000 #'000
Profit/(loss) for the period/year 3,700 (3,525) (4,928)
Other recognised gains and losses during the
period/year (2,918) (880) 535
New share capital issued 75 1,281 1,281
Equity dividends proposed - - (944)
Decrease in reserve for shares to be issued (530) (6,145) (7,261)
---------- -------- ---------
Net increase/(decrease) in shareholders' funds 327 (9,269) (11,317)
--------
Opening shareholders' funds - as previously
reported 56,995
Prior year adjustment for own shares held by
employee share trust (see note 1) (970)
--------
Opening shareholders' funds - adjusted 44,708 56,025 56,025
---------- -------- ---------
Closing shareholders' funds 45,035 46,756 44,708
---------- -------- ---------
11. Reconciliation of operating profit/(loss) to net cash flow from operating
activities
unaudited unaudited audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
#'000 #'000 #'000
Operating profit/(loss) 5,612 (2,995) (3,820)
Depreciation 556 635 1,223
Amortisation 1,893 2,021 4,029
Management long term incentive plan credit (502) (1,504) (1,919)
Adjustment for pension funding (1,024) (515) (3,029)
(Increase)/decrease in debtors (5,364) (1,735) 534
Increase/(decrease) in creditors 6,685 (1,727) (2,043)
(Decrease)/increase in provisions (48) (115) 68
---------- -------- ---------
Net cash inflow/(outflow) from operating
activities 7,808 (5,935) (4,957)
---------- -------- ---------
12. Analysis of net funds
net funds cash exchange net funds
at 1 Jan 2004 flow movement at 30 June 2004
#'000 #'000 #'000 #'000
------------ ------------ ------------ -----------
Cash at bank 9,738 2,772 (126) 12,384
------------ ------------ ------------ -----------
13. Reconciliation of net cash flow to movement in net funds
unaudited unaudited audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
#'000 #'000 #'000
Increase/(decrease) in cash 2,772 (12,271) (11,752)
---------- -------- ---------
Change in net funds arising from cash flows 2,772 (12,271) (11,752)
Exchange movement (126) (104) (438)
---------- -------- ---------
Movement in net funds in the period/year 2,646 (12,375) (12,190)
Net funds at beginning of period/year 9,738 21,928 21,928
---------- -------- ---------
Net funds at end of period/year 12,384 9,553 9,738
---------- -------- ---------
14.Retirement benefits
The retirement benefits liability relates to the closed US defined benefit
pension scheme and to the closed US post-retirement medical benefits plan.
Entitlement to additional benefits under the US defined benefits pension scheme
ceased on 31 December 2001. The US post-retirement medical benefits plan relates
to certain former employees who retired prior to 30 September 1995 and to a
small number of current and former employees who were employed at that date.
Accordingly, further benefit accruals under this plan are insignificant.
The retirement benefits liability at 30 June 2004 has been estimated by the
actuaries on the basis described in the last annual report except that the
discount rate applied to the liabilities has been increased by 0.25% to 6.25%
and the mortality assumptions have been revised. The latter gave rise to an
actuarial loss of #1.0 million which is included in the #0.4 million actuarial
loss arising in the period.
unaudited unaudited Audited
six months six months year
ended ended ended
30 June 30 June 31 Dec
2004 2003 2003
#'000 #'000 #'000
Retirement benefits liability at start of
period/year (13,213) (17,290) (17,290)
Pension contributions 947 428 1,315
Payment of medical benefits 77 88 140
Service costs - (1) 1,574
Net finance expense (138) (422) (725)
Actuarial (loss)/gain (422) (1,824) 285
Foreign exchange translation 242 530 1,488
---------- -------- ---------
Retirement benefits liability at end of
period/year (12,507) (18,491) (13,213)
---------- -------- ---------
15. Statutory accounts
The above financial information does not constitute statutory accounts as
defined in Section 240 of the Companies Act 1985. The statutory accounts for the
financial year ended 31 December 2003, upon which the auditors issued an
unqualified opinion pursuant to Section 235 of the Companies Act 1985 and which
do not contain a statement under sub-section (2) or Section 237 of that Act,
have been delivered to the Registrar of Companies.
16. International Financial Reporting Standards
The Group will prepare its first full financial statements in accordance with
International Financial Reporting Standards (IFRS) for the year ending 31
December 2005. The Group has carried out an initial high level assessment of the
impact that IFRS will have on the financial results and we have begun the
initial phase of quantifying the impact on 2004 comparative information. The
final requirements of IFRS are not yet certain. Our initial assessment indicates
that the principal effects on our financial statements will be the elimination
of goodwill amortisation and the introduction of a charge for share options.
Further information will be provided in the annual report for the year ending 31
December 2004.
17. Interim report
A copy of the Group's interim report will be sent to shareholders on 19 August
2004 and copies will be available at the Company's registered office at 21 New
Fetter Lane, London EC4A 1AW.
This information is provided by RNS
The company news service from the London Stock Exchange
END
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