TIDMSDL
RNS Number : 4810R
SDL PLC
15 June 2018
15 June 2018
SDL plc
Notice of 2018 Interim Results
Re-classification of Segmental Results & Webcast
Notice of 2018 interim results
SDL plc ("the Company" or "the Group" / LSE: SDL), the global
innovator in language translation technology, services and content
management, will announce its interim results for the six months
ended 30 June 2018 on Monday 6 August 2018.
A presentation to analysts and investors hosted by Adolfo
Hernandez, Chief Executive Officer, and Xenia Walters, Chief
Financial Officer, will be held on 6 August 2018 at 9.30am BST at
the offices of FTI Consulting, 200 Aldersgate Street , London, EC1A
4HD.
Re-classification of segmental results
Introduction
At the time of SDL's full year results in March 2018, management
stated its intention to review the classification of its shared
costs used to derive the profitability of each of its three
business segments. In order to aid familiarity with the new
classification and provide comparative information, SDL is today
publishing the re-classification of its segmental profits for the
six months ended June 2017 and the full year to December 2017. This
re-classification does not impact overall Group profit or cash flow
numbers, which are as previously reported.
Furthermore, this announcement today does not provide any new
information about recent or current trading of the business.
Background
SDL's operating cost base is made up of direct and shared costs.
In line with our strategic objective to operate as 'One SDL' and
remove the silos and overlaps across segments, increasing
proportions of our activities are operating across segments.
For the year ended 31 December 2017 SDL's total shared costs, as
previously classified, accounted for GBP86.5m of our GBP127.0m cost
base, with approximately 70% being apportioned on either a
headcount or revenue basis by segment. This methodology has been
consistently applied in previous years.
However, this methodology can result in better performing
segments bearing more of the shared costs than might be
appropriate. Accordingly, management has historically focused on
segment gross profit as a more useful indicator of segment
profitability.
Following a detailed review, SDL is re-classifying its shared
costs as follows:
- The corporate costs of running SDL PLC as a listed group have
been separately disclosed as unallocated costs in the
reconciliation of segment profit to Group profit. These costs
amounted to GBP15.1m for the twelve months ended 31 December 2017
and GBP8.0m for the six months ended 30 June 2017; and
- The remainder of the costs are reported in the operating
segments on the basis of activity-based cost methodologies
SDL believes this re-classification provides investors and
analysts with a clearer insight into the profit segments and cost
centres of the Group. This reclassification is presented in the
tables below.
In addition, research and development operating cost disclosures
have been restated to only include directly attributable salary and
external costs, and specifically exclude all allocations of support
and central costs. This restatement has been performed to bring the
basis of research and development operating costs disclosure in
line with the basis of capitalised research and development costs,
enabling users of the accounts to compare these disclosures on a
like for like basis. Accordingly research and development costs are
being restated to GBP10.2m and GBP20.1m for the periods ended 30
June and 31 December 2017 (Previously reported: 1H: GBP15.9m and
FY17 GBP26.4m).
A webcast hosted by Xenia Walters, Chief Financial Officer, will
be held today at 11.30am BST. Please pre - register with
mhudson@sdl.com to obtain webcast details.
No new material information will be disclosed. A recording will
also be made available on the investor relations section of SDL's
website following the call.
For further information please contact:
SDL plc 01628 410100
Adolfo Hernandez, CEO
Xenia Walters, CFO
FTI Consulting LLP 0203 727 1000
Edward Bridges
Emma Hall
About SDL PLC
SDL (LSE: SDL) is the global innovator in language translation
technology, services and content management. Over the past 25 years
we've helped companies deliver transformative business results by
enabling powerful, nuanced digital experiences with customers
around the world.
Year ended 31 December Unaudited
Group and segmental revenue and PBTA results analysis for twelve
months to 31 December 2017 (restated)
Language Language Global Content
GBPm Services Technologies Technologies Consolidated
Revenue 184.5 48.6 52.6 285.7
---------- -------------- --------------- -------------
Gross Profit 74.8 38.6 35.6 149.0
Segment operating costs (52.7) (32.6) (29.1) (114.4)
R&D capitalisation - - 2.5 2.5
---------- -------------- --------------- -------------
Segment Adjusted PBTA 22.1 6.0 9.0 37.1
---------- -------------- ---------------
Corporate costs1 (15.1)
-------------
Adjusted PBTA Continuing
Operations 22.0
Non core - Discontinued Operations2 (3.0)
-------------
Group Adjusted PBTA 19.0
Profit on disposal 20.6
Amortisation and exceptional
items (9.7)
-------------
Profit before taxation 29.9
-------------
Continuing Operations
Gross Profit % 40.5% 79.4% 67.7% 52.2%
---------- -------------- --------------- -------------
Segment Adjusted PBTA % 12.0% 12.3% 17.1% 7.7%
---------- -------------- --------------- -------------
1 Corporate costs are the costs of running SDL PLC as a listed
Group and are independent of operating segments
2 Results from the Non core segment have been disclosed
separately to facilitate like for like comparison with the 2018
results to be published in due course
Group and segmental revenue and PBTA results analysis for twelve
months to 31 December 2017 (as previously reported)
Language Language Global Content
GBPm Services Technologies Technologies Consolidated
Revenue 184.5 48.6 52.6 285.7
---------- -------------- --------------- -------------
Gross Profit 75.9 38.1 35.0 149.0
Segment operating costs (66.4) (33.2) (29.9) (129.5)
R&D capitalisation - - 2.5 2.5
---------- -------------- --------------- -------------
Segment Adjusted PBTA 9.5 4.9 7.6 22.0
---------- -------------- ---------------
Corporate costs --
-------------
Adjusted PBTA Continuing
Operations 22.0
Non core - Discontinued Operations (3.0)
-------------
Group Adjusted PBTA 19.0
Profit on disposal 20.6
Amortisation and exceptional
items (9.7)
-------------
Profit before taxation 29.9
-------------
Continuing Operations
Gross Profit % 41.1% 78.4% 66.5% 52.2%
---------- -------------- --------------- -------------
Segment Adjusted PBTA % 5.1% 10.1% 14.4% 7.7%
---------- -------------- --------------- -------------
Six months to 30 June Unaudited
Group and segmental revenue and PBTA results analysis for six months
to 30 June 2017 (restated)
Language Language Global Content
GBPm Services Technologies Technologies Consolidated
Revenue 89.5 22.8 26.8 139.1
---------- -------------- --------------- -------------
Gross Profit 34.4 18.1 17.7 70.2
Segment operating costs (24.9) (15.6) (13.7) (54.2)
---------- -------------- --------------- -------------
Segment Adjusted PBTA 9.5 2.5 4.0 16.0
---------- -------------- ---------------
Corporate costs (8.0)
-------------
Adjusted PBTA Continuing
Operations 8.0
Non core - Discontinued Operations (3.1)
-------------
Group Adjusted PBTA 4.9
Profit on disposal 20.6
Amortisation and exceptional
items (4.9)
-------------
Profit before taxation 20.6
-------------
Continuing Operations
Gross Profit % 38.4% 79.4% 66.0% 50.5%
---------- -------------- --------------- -------------
Segment Adjusted PBTA % 10.6% 11.0% 14.9% 5.7%
---------- -------------- --------------- -------------
Group and segmental revenue and PBTA results analysis for six months
to 30 June 2017 (as previously reported)
Language Language Global Content
GBPm Services Technologies Technologies Consolidated
Revenue 89.5 22.8 26.8 139.1
---------- -------------- --------------- -------------
Gross Profit 34.1 18.7 17.4 70.2
Segment operating costs (28.7) (18.0) (15.5) (62.2)
---------- -------------- --------------- -------------
Segment Adjusted PBTA 5.4 0.7 1.9 8.0
---------- -------------- ---------------
Corporate costs -
-------------
Adjusted PBTA Continuing
Operations 8.0
Non core - Discontinued Operations (3.1)
-------------
Group Adjusted PBTA 4.9
-------------
Profit on disposal 20.6
Amortisation and exceptional
items (4.9)
-------------
Profit before taxation 20.6
-------------
Continuing Operations
Gross Profit % 38.1% 82.0% 64.9% 50.5%
---------- -------------- --------------- -------------
Segment Adjusted PBTA % 6.0% 3.1% 7.1% 5.7%
---------- -------------- --------------- -------------
Note: R&D capitalisation applied from the second half of
2017 only.
END
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END
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