2024 FULL YEAR RESULTS
5 December 2024
FUTURE plc
2024 FULL YEAR RESULTS
Growth Acceleration Strategy delivering good progress
H2 momentum driving the return to organic growth
Future plc (LSE: FUTR, "Future", "the Group"), the global platform for specialist media, today publishes its results for the year ended 30 September 2024.
Highlights
Financial results for the year ended 30 September 2024
|
Adjusted results¹ |
FY 2024 |
FY 2023 |
Reported Var |
Constant currency var |
Organic Var |
|
Revenue (£m) |
788.2 |
788.9 |
flat |
+1% |
+1% |
|
Adjusted EBITDA (£m) |
239.1 |
276.8 |
(14)% |
(12)% |
n/a |
|
Adjusted operating profit (£m) |
222.2 |
256.4 |
(13)% |
(11)% |
n/a |
|
Adjusted operating profit margin (%) |
28% |
32% |
(4)ppt |
(4)ppt |
n/a |
|
Adjusted diluted EPS (p) |
123.9 |
140.9 |
(12)% |
n/a |
n/a |
|
Adjusted free cash flow (£m)
|
222.3 |
253.2 |
(12)% |
n/a |
n/a |
|
Statutory results |
FY 2024 |
FY 2023 |
Reported Var |
|
|
|
Revenue (£m) |
788.2 |
788.9 |
flat |
|
|
|
Operating profit (£m) |
133.7 |
174.5 |
(23)% |
|
|
|
Operating profit margin (%) |
17% |
22% |
(5)ppt |
|
|
|
Profit before tax (£m) |
103.2 |
138.1 |
(25)% |
|
|
|
Diluted EPS (p) |
66.8 |
94.1 |
(29)% |
|
|
|
Cash generated from operations (£m) |
230.0 |
241.0 |
(5)% |
|
|
1 The Glossary section of this document provides definitions of, and reconciliations to, adjusted measures.
Financial highlights
● Revenue was flat year-on-year at £788.2m (FY 2023: £788.9m), with +1% organic growth, offset by adverse foreign exchange (mainly USD).
○ The Group returned to year-on-year organic revenue growth of +1%, with a strong H2 performance, up +5%.
○ UK revenue grew by +6% on an organic basis driven by Media +13% with continued very strong growth in Go.Compare, up +28%, B2B recorded +2% growth whilst B2C saw a (6)% decline, impacted by market conditions and the weight of Magazines.
○ US revenue fell by (6)% on an organic basis, with an improving trend with H2 flat. This was driven by Media, with digital advertising returning to organic year-on-year growth in H2 of +2%, with further acceleration in Q4.
● Profitability was in line with expectations with 28% adjusted operating margin reflecting investment from the previously announced Growth Acceleration Strategy (GAS), resulting in an adjusted operating profit decline of (13)% to £222.2m (FY 2023: £256.4m). Statutory operating profit was down (23)% to £133.7m (FY 2023: £174.5m) mainly reflecting adjusted operating profit movement.
● The Group remains highly cash generative with adjusted free cash flow of £222.3m (FY 2023: £253.2m), representing 100% of adjusted operating profit (FY 2023: 99%). Cash generated from operations was £230.0m (FY 2023: £241.0m).
● Leverage reduced to 1.1x (FY 2023: 1.3x) with net debt at the end of the year of £256.5m (FY 2023: £327.2m). Total available debt facilities at the end of September 2024 were £650m (FY 2023: £900m).
● £68.6m was returned to shareholders during the year comprising £64.7m through share buybacks (FY 2023: £13.0m) and dividends of £3.9m (FY 2023: £4.1m). New share buyback programme for up to £55m starting in January 2025.
Growth Acceleration Strategy (GAS)
● In December 2023, we launched the Growth Acceleration Strategy (GAS) to ensure Future is well-positioned to capitalise on future opportunities in its attractive and growing markets. This is a two-year investment programme of £25m-£30m to drive acceleration in a compounding model.
● We've made good progress in the first year of the plan, resulting in the Group's return to organic growth. We've added over 100 new team members across sales, editorial and back office and progress against our three strategic pillars includes:
● Growing a highly engaged and valuable audience - increased focus on brand leadership and content to drive premium monetisation:
○ Online users2 continued to stabilise in H2 2024, with users finishing the year down (6)% at 226m, with growth in Technology and Gaming verticals (FY 2023: 241m). Sessions2 were up +2% year-on-year with an increase in sessions per user.
○ Off-platform users grew to 250m (FY 2023: 240m), driven by Apple News and social media followers.
○ Announcing today a strategic partnership with Open AI to bring our content to Open AI's users, creating new ways for users to engage with our content. The partnership is not financially material.
● Diversifying and increasing revenue per user - adding new routes of monetisation and driving market-leading positions to improve yield:
○ Branded content growth of +9% to support the move to premium monetisation of our online audience.
○ Vouchers grew +40% and now contribute £13.0m of revenue.
○ Go.Compare growth of +28% driven by strong car insurance performance and good progress in other insurance categories.
○ B2B returned to year-on-year growth with organic revenue growth of +2%.
● Optimising our portfolio
Ensuring we have the right portfolio of assets is a continuous process. During the year, we announced the closure of a small number of non-core or low to no growth assets to ensure the Group is best positioned for sustainable growth.
● A clear focus for FY 2025
As we look to complete GAS, our focus will be to:
○ Yield our editorial investment
○ Improve monetisation
○ Diversify Go.Compare revenue
Whilst continuously reviewing our portfolio, applying our capital allocation and maintaining strong financial characteristics.
Board changes
● As previously stated, on 18 October 2024, we announced that Jon Steinberg (CEO) would be stepping down in 2025. The Board has initiated a search for his replacement and will provide an update on the search when appropriate.
● Sharjeel Suleman joined the Company's Board as Chief Financial Officer on 16 September 2024.
Outlook
● Our return to revenue growth in H2, driven by the execution of GAS, puts the Group in a good position to achieve current market expectations for FY 2025. We expect to continue to operate at an adjusted operating profit margin of 28% for the coming year reflecting the planned incremental GAS costs, and to maintain strong cash conversion.
● Beyond FY 2025, we now expect to deliver accelerating organic revenue growth, in line with current market expectations.
Jon Steinberg, Future's Chief Executive, said:
"We launched our Growth Acceleration Strategy one year ago and have made good strategic progress. We have invested in sales and editorial roles, successfully diversified and grown revenue per user, and we have further optimised our portfolio. Importantly, the Group has returned to organic revenue growth during the year, underpinned by a strong H2 performance.
"The execution of our strategy combined with our strong financial characteristics, including a flexible cost base and highly cash generative profile, creates further optionality and positions the business well.
"Looking ahead, whilst we remain mindful of the macro environment and the ongoing evolution of the media landscape, we are confident that the ongoing execution of our Growth Acceleration Strategy will drive long-term accelerating organic revenue growth."
Presentation
A live webcast of the analyst presentation will be available at 09.30 am (UK time) today at: https://stream.brrmedia.co.uk/broadcast/6723a410c86085b1bff5e096
A copy of the presentation will be available on our website at: https://www.futureplc.com/investor-results/
A recording of the webcast will also be made available.
The definitions below apply throughout the document.
1) A reconciliation of adjusted results to statutory measures is included in the Glossary section at the end of this document.
2) Online users defined as the average monthly total daily users over the financial period from Google Analytics.
Online sessions defined as the average monthly total daily sessions over the financial period from Google Analytics.
Enquiries:
|
Future plc |
+44 (0)122 544 2244 |
|
Jon Steinberg, Chief Executive Officer |
|
|
Sharjeel Suleman, Chief Financial Officer |
|
|
Marion Le Bot, Head of Investor Relations |
+44 (0)777 564 1509 |
|
|
|
|
Media |
|
|
Headland |
+44 (0)203 805 4822 |
|
Stephen Malthouse, Charlie Twigg, Rob Walker
|
|
|
future@headlandconsultancy.com
|
|
About Future
We are the platform for creating and distributing trusted, specialist content, to build engaged and valuable global communities. We operate ~200 brands in diversified content verticals, with multiple market leading positions and three core monetisation frameworks: advertising, eCommerce affiliate and direct consumer monetisation (subscriptions and newstrade magazine sale). Our content is published and distributed through a range of formats including websites, email newsletters, videos, magazines and live events. The successful execution of our strategy is focused on three pillars: grow engaged audience, diversify and grow revenue per user and optimise the portfolio.
Chief Executive Officer's review
Media has always been, and will always be, one of the most dynamic industries. Therefore, the agility to lean into opportunities and capacity to fund growth opportunities are paramount to deliver sustainable revenue growth. This is the genesis of the Growth Acceleration Strategy or GAS, announced at the full year results in December 2023, our investment programme to return the Group to organic revenue growth in FY 2024, whilst maintaining our strong financial characteristics of healthy adjusted operating margins (28-30%) and strong cash flow generation.
Our strategy is structured around a simple equation: reach valuable audiences and grow Revenue Per User and apply this to as many monetisation routes available, whilst optimising our portfolio to accelerate value creation. We set into FY 2024 with five key objectives articulated around our three strategic pillars:
1. Invest in content
2. Diversify audience and revenue
3. Drive US digital advertising
4. Optimise the portfolio
5. Maintain strong financial characteristics and apply our capital allocation framework
1. Invest in content
Central to our business model is great content which drives the passionate, intent-led and therefore valuable audience. Our quality of content supported by investment is really core to our operating model. It is embodied by our content strategy.
During the year, we hired ~50 incremental editorial heads to support content creation, across news, how-to and buying guides. This has resulted in increased output during the year with the number of articles created or updated up by over 15% and with further enhanced tight collaboration between our audience and editorial teams to ensure our content meets audience expectations.
2. Diversify audience and revenue
Diversification is the key to resilience and sustainability in a market that evolves constantly. During the year, we have made progress on diversifying our acquisition of audience, notably in social media (FY 2024: 221m, FY 2023: 217m) and email newsletters (FY 2024: 16m, FY 2023: 15m). Email newsletter subscribers are a loyal audience, with rich first-party data that feeds into our data audience platform, Aperture, which in turn enables more effective contextual premium advertising. Today, we are announcing a strategic partnership with Open AI to bring our content to Open AI's users, creating new ways for users to engage with our content. The partnership is not financially material.
In terms of diversification of revenue, we have seen very strong growth in Go.Compare (+28%) and a return to modest organic growth in B2B (+2%). Within Go.Compare, we also drove strong growth outside car insurance - our main revenue stream - with 36% (+1ppt year-on-year) of revenue now coming from these other strategic verticals. In terms of revenue streams, the Group continuously looks for new growth in adjacent revenue streams. A good example of this is vouchers - which now represent £13.0m of revenue, compared to less than £9m in FY 2022. More recently, branded content represents a new route to growth. During the year we established a branded content centre of excellence, Future Creative, which contributed to the +9% of growth during the year of branded content revenue.
3. Drive US digital advertising
The US market is 8 times bigger than the UK, yet our US digital advertising revenue is only 2.5 times our UK digital advertising revenue, highlighting the opportunity. To fuel this initiative, we have reorganised our US sales force, added talent to the team as well as unified our sales commission approach. This has been combined with the launch of Future Creative, our branded content centre of excellence, to drive the sale of premium packages, including direct campaigns. The focus in digital advertising is to capture more value from our existing valuable audiences by moving inventory to premium direct advertising. During the year, in the US we have moved +2ppt of advertising revenue into premium direct advertising. Although market dynamics in US digital remain challenging, we are performing well with a return to growth in H2 (+2%) and an accelerated exit rate in Q4 to +6%.
4. Optimise the portfolio
Optimising our portfolio is a continuous process driving focus and accountability to ensure execution of our strategy. We continuously assess our assets to ensure they are strategic, poised for growth and/or cash generative. During the year, we closed brands that did not meet these criteria, representing approximately £15m of annualised revenue.
Earlier in the year we segmented the Group into three distinct businesses with newly appointed business leaders: B2C, Go.Compare and B2B. This new structure will make the Group more agile and less complex, enabling faster and focussed execution of the strategy to deliver improved growth.
The Board will continue to keenly appraise performance and will actively look at further options to accelerate value creation across the Group's business units.
5. Maintain strong financial characteristics and apply our capital allocation framework
The Group continues to have strong financial characteristics of high margins and strong cash generation. Adjusted free cash flow conversion of 100% represented £230.0m cash generated from operations. Our capital allocation framework was applied to optimise value creation. During the year, we repaid £93.0m of gross debt and returned £68.6m to shareholders through our annual dividend and two share buyback programmes, of which the last one completed post our financial year-end in October 2024. We have also announced a new share buyback programme of up to £55m starting in January 2025. The Group will return excess free cash to shareholders such that the Group maintains a minimum leverage of 1x.
Execution underpinned by values
I continue to be extremely impressed by the depth of talent and energy throughout Future, and I want to personally thank our colleagues for their hard work. I am incredibly proud to be leading this organisation.
As a responsible business everything we do is underpinned by our purpose and values which fosters an aligned culture across the organisation and looks to ensure we create value for all stakeholders. We are extremely fortunate that our brands give us the platform and opportunities to influence and inspire people across the globe to encourage positive change.
Outlook
● Our return to revenue growth in H2, driven by the execution of GAS, puts the Group in a good position to achieve current market expectations for FY 2025. We expect to continue to operate at an adjusted operating profit margin of 28% for the coming year reflecting the planned incremental GAS costs, and to maintain strong cash conversion.
● Beyond FY 2025, we now expect to deliver accelerating organic revenue growth, in line with current market expectations.
Financial summary
The financial summary is based primarily on a comparison of results for the year ended 30 September 2024 with those for the year ended 30 September 2023.
|
|
FY 2024 £m |
FY 2023 £m |
|
Revenue |
788.2 |
788.9 |
|
Adjusted EBITDA |
239.1 |
276.8 |
|
Adjusted operating profit |
222.2 |
256.4 |
|
Adjusted profit before tax |
191.8 |
221.3 |
|
|
|
|
|
Operating profit |
133.7 |
174.5 |
|
Profit before tax |
103.2 |
138.1 |
|
|
|
|
|
Basic earnings per share (p) |
67.2 |
94.7 |
|
Diluted earnings per share (p) |
66.8 |
94.1 |
|
Adjusted basic earnings per share (p) |
124.6 |
141.8 |
|
Adjusted diluted earnings per share (p) |
123.9 |
140.9 |
The Directors believe that adjusted results provide additional useful information on the core operational performance of the Group and review the results on an adjusted basis internally. Refer to the Glossary section at the end of this document for a reconciliation between adjusted and statutory results.
Revenue
|
Revenue movement1 |
FY 2024 vs FY 2023 % |
|
Organic growth |
+1% |
|
Impact of acquisitions and disposals |
- |
|
Year-on-year growth at constant rate |
+1% |
|
Impact of foreign exchange |
(1)% |
|
Reported revenue change |
flat |
1 The Glossary section of this document provides definitions of, and reconciliations to, adjusted measures.
Group revenue was flat year-on-year at actual currency, with a +1% organic growth offset by adverse foreign exchange. FY 2023 acquisitions which have not been acquired for a full financial year and FY 2024 disposals and closures contributed a net £13.6m (FY 2023: £13.7m) of revenue in the year.
|
Revenue |
FY 2024 £m |
FY 2023 £m |
YoY Var |
Organic YoY Var |
|
Advertising & other |
78.8 |
86.9 |
(9)% |
(9)% |
|
eCommerce affiliates |
237.2 |
193.9 |
+22% |
+22% |
|
Media |
316.0 |
280.8 |
+13% |
+13% |
|
Magazines |
188.0 |
195.8 |
(4)% |
(4)% |
|
Total UK |
504.0 |
476.6 |
+6% |
+6% |
|
Advertising & other |
146.4 |
159.1 |
(8)% |
(4)% |
|
eCommerce affiliates |
66.1 |
75.0 |
(12)% |
(10)% |
|
Media |
212.5 |
234.1 |
(9)% |
(6)% |
|
Magazines |
71.7 |
78.2 |
(8)% |
(5)% |
|
Total US |
284.2 |
312.3 |
(9)% |
(6)% |
|
|
|
|
|
|
|
Advertising & other |
225.2 |
246.0 |
(8)% |
(6)% |
|
eCommerce affiliates |
303.3 |
268.9 |
+13% |
+15% |
|
Media |
528.5 |
514.9 |
+3% |
+5% |
|
Magazines |
259.7 |
274.0 |
(5)% |
(5)% |
|
TOTAL REVENUE |
788.2 |
788.9 |
flat |
+1% |
Revenue by geography
UK revenue increased by +6% or +£27.4m to £504.0m (FY 2023: £476.6m) and accelerated in H2 to +8%. The improvement in H2 was driven by continued solid growth in Go.Compare (H2: +26%, FY: +28%)) combined with a return to organic growth in eCommerce product and rewards (H2: +50%, FY: +5%). Organic digital advertising remained under pressure (H2:(16)%, FY: (16)%) but was stable half-over-half. The UK strong result is driven by a well-diversified revenue mix, despite a high proportion of magazines revenue (37%) which are in secular decline.
US revenue declined by (9)% or £(28.1)m to £284.2m (FY 2023: £312.3m), including the negative impact of foreign exchange and from acquisitions made in FY 2023. Organic revenue was down (6)% in the year but flat in H2. The improvement was driven by +2% growth in digital advertising in H2 (FY 2024: (5)%).
Revenue by type
Media revenue increased by +£13.6m or +3% to £528.5m (FY 2023: £514.9m) and +5% on an organic basis.
Organic digital advertising revenue declined by (8)% due to challenging market conditions. While there were lower online users year-on-year, we had an overall increase in sessions. Notably there was an improved trend in H2 which was only down (4)% with the US showing growth of +2%. During the year our yields were stable, as a result of improved sales effectiveness and improvement in direction of digital advertising mix. This demonstrates the Group's ability to deliver valuable audiences to advertisers.
Organic affiliate revenue grew by +15% during the year and +20% in H2, with the very strong continued growth in Go.Compare (FY:+28%, H2: +26%), combined with a return to growth in H2 of eCommerce products and vouchers of +14% (FY: (7)%). This performance highlights the benefit of having diversified revenue streams. In eCommerce products, we have been impacted by the wider macroeconomy and its impact on consumers. As a result there have been fewer views of our buying guides. However we have seen improving trends in H2, notably on average basket size which ended flat year-on-year. In our price comparison business, performance continued to be strong, notably in car and home insurance, benefiting from a high volume of quotes due to high renewal premia and we have continued to make progress on our strategy of diversification with 36% of the revenue now coming outside of car insurance.
Magazine revenue declined by £(14.3)m or (5)% to £259.7m (FY 2023: £274.0m). Magazine organic revenue was also down (5)% year-on-year. Subscriptions, which account for 50% of Magazines revenue, experienced a (3)% organic decline, mainly in specialist brands, with more resilience in premium brands driven by favourable pricing. The rest of the magazine portfolio was down (6)% organically in-line with secular trends.
Revenue by division
Following the Group reorganisation announced during FY 2024, going forward we will be focussing on revenue analysis by division.
This structure will be fully effective during FY 2025, including financial monitoring.
|
REVENUE |
FY 2024 |
FY 2023 |
Reported change |
Organic change |
|
B2C |
523.1 |
567.1 |
(8)% |
(6)% |
|
Go.Compare |
202.7 |
158.5 |
+28% |
+28% |
|
B2B |
62.4 |
63.3 |
(1)% |
+2% |
|
Total revenue |
788.2 |
788.9 |
flat |
+1% |
Revenue for B2C was impacted by the challenging digital advertising market, as well as lower consumer spend in affiliate products. Whilst we continue to see secular decline in magazines, which is nearly 50% of the B2C division, there was an improving trend in H2, with B2C declining by (1)% on an organic basis in the second half of the year.
Revenue for our price comparison business Go.Compare grew +28% in the year, with continued strong growth in H2 despite challenging comparators. This solid performance is driven by favourable market conditions and effective marketing, combined with progress on strategic verticals which now represent 36% of Go.Compare's revenue. During the year, Go.Compare gained market share and is now #2 in car insurance.
Organic revenue in our B2B business grew by +2% in the year, with a slowdown in H2 to (7)% driven by challenging market conditions, notably with technology clients offset by volume growth from lead generation and email newsletters. During the year, we have unified our B2B business under one fully integrated organisation, from products to sales to operations, to drive growth opportunities.
Operating profit
Cost of sales including distribution costs (see note 3) were up 7% year-on-year as a result of a change in revenue mix. The robust revenue growth in Go.Compare includes PPC (pay per click) costs, which have been offset by lower Magazine cost of sales rates. During the year the Group refined its policy for allocating costs between costs of sales and overheads. This is a change in presentation which has been applied prospectively. Applying the same methodology to prior year comparatives would increase cost of sales and reduce other administration expenses by £5.9m. See note 3 to the financial statements for further details.
Other costs have increased by 5% year-on-year reflecting Growth Acceleration Strategy investment, including the recruitment of net 112 people during the year to drive editorial content output as well as US sales capabilities, combined with a 5% average pay rise awarded to colleagues from January 2024, which increased salary and wages costs.
As a result, adjusted operating profit margin has declined by (4)ppt to 28% (FY 2023: 32%). Being able to deliver a margin of 28% despite investment in the Growth Acceleration Strategy combined with inflationary pressures within wages, the largest cost, is a testament to the strength of the Group, with a year-on-year reduction in adjusted operating profit by £(34.2)m to £222.2m (FY 2023: £256.4m), including the negative impact of foreign exchange translation. The diversified revenue and strong financial characteristics of the Group, even in a challenging macroeconomic environment, have provided clear benefits. Statutory operating profit decreased by £(40.8)m to £133.7m (FY 2023: £174.5m) and statutory operating margin decreased by (5)ppt to 17% (FY 2023: 22%), primarily driven by the investment in the Growth Acceleration Strategy and inflation.
Earnings per share
|
|
FY 2024 |
FY 2023 |
|
Basic earnings per share (p) |
67.2 |
94.7 |
|
Adjusted basic earnings per share (p) |
124.6 |
141.8 |
|
Diluted earnings per share (p) |
66.8 |
94.1 |
|
Adjusted diluted basic earnings per share (p) |
123.9 |
140.9 |
Basic earnings per share is calculated using the weighted average number of ordinary shares in issue during the period of 114.4m (FY 2023: 119.8m), the decrease reflecting the share buyback programmes.
The Glossary section at the end of this document provides the definition of adjusted earnings per share and a reconciliation to reported earnings per share.
Transaction and integration related costs
Transaction and integration related costs of £5.9m incurred in the year reflect £3.5m of professional fees to support portfolio optimisation across the Group's divisions, £1.6m of post-integration IT system costs and associated fees and £0.8m of transaction-related legal fees (FY 2023: £5.3m of deal-related fees, £2.0m of restructuring costs net of £0.8m released following settlement of provision for historical legal claims recognised on the Dennis opening balance sheet, and £0.9m onerous property costs).
Exceptional items
Exceptional costs incurred in the year include a £4.5m impairment of acquired intangible assets following brand closures in the year, primarily relating to iMore, a brand acquired as part of the Mobile Nations acquisition in 2019, £1.7m (FY 2023: £0.9m) relating to properties which became onerous and were treated as exceptional in prior years and £0.8m (FY 2023: £6.4m) relating to restructuring costs.
Other adjusting items
Amortisation of acquired intangibles of £66.7m (FY 2023: £59.4m) includes £11.0m accelerated amortisation of the Look After My Bills ('LAMB') brand and customer lists, arising from the Go.Compare acquisition. The useful economic lives of the LAMB assets were reduced during the year, with the revised lives ending on 30 September 2024, following the cessation of active management of the business, which by 30 September 2024 was closed.
Share-based payment expenses relating to equity-settled share awards with vesting periods longer than twelve months, together with associated social security costs, increased by £1.1m to £8.9m (FY 2023: £7.8m). Share based payment expenses are excluded from the adjusted results of the Group as the Directors believe they result in a level of charge that would distort the user's view of the core trading performance of the Group, and include the historical one-off all-employee Value Creation Plan scheme where a charge is booked irrespective of the likelihood of achieving the vesting targets.
Net finance costs and refinancing
Following a review of its committed facilities and expected utilisation, the Group reduced the commitments on its Revolving Credit Facility ('RCF') from £500.0m to £350.0m on 16 February 2024 and on its Export Development Guarantee ('EDG') term facility from £400.0m to £300.0m on 29 February 2024. At 30 September 2024, 53.8% (£350.0m of £650.0m) of the Group's facilities remained undrawn (30 September 2023: 56.1% (£504.8m of £900.0m) undrawn).
Net finance costs decreased to £30.5m (FY 2023: £36.4m) which includes net external interest payable of £25.9m reflecting the reduction in the Group's debt; £3.9m in respect of the amortisation of arrangement fees relating to the Group's bank facilities; and £0.2m increase in fair value of contingent consideration relating to the ActualTech acquisition which was settled on 31 January 2024. A further £1.7m of net interest was recognised in relation to lease liabilities.
At 30 September 2024, 100.0% (FY 2023: 75.9%) of the Group's variable interest rate exposure was hedged, via interest rate swap agreements on a notional £300.0m (FY 2023: £300.0m) of the Group's EDG term facility, at an effective fixed rate of 6.39% (FY 2023: 7.04%) including margin and related fees.
The swaps have been valued based on the present value of the estimated future cash flows based on observable yield curves. An asset and liability both equalling £1.4m have been recognised on the balance sheet at 30 September 2024 (30 September 2023: net assets of £5.9m) with a corresponding decrease in the cash flow hedge reserve.
Taxation
The tax charge for the year amounted to £26.4m (FY 2023: £24.7m), comprising a current tax charge of £37.9m (FY 2023: £44.3m) and a deferred tax credit of £11.5m (FY 2023: charge of £19.6m). The current tax charge arises in the UK where the standard rate of corporation tax in FY 2024 is 25% and in the US where the Group pays a blended Federal and State tax rate of 28%.
The Group's FY 2024 adjusted effective tax rate was 25.7% (FY 2023: 23.3%). The Glossary section at the end of this document provides a reconciliation between the Group's adjusted effective tax charge and statutory effective tax charge. The increase in rate in FY 2024 reflects the increase in the UK rate of corporation tax that took effect on 1 April 2023.
The Group's statutory effective tax rate, inclusive of adjustments in respect of previous
years, has increased to 25.6% (FY 2023: 17.9%). Excluding the adjustments in respect of
previous years, the FY 2024 statutory tax rate was 24.1% (FY 2023: 24.9%). The difference between the statutory tax rate of 25.6% and the adjusted effective tax rate of 25.7% is attributable to the tax effect of a change in provisions related to accounting for uncertain tax liabilities, offset by prior year adjustments and other non-deductible items.
The Group's net deferred tax liability decreased by £13.7m to £93.5m (FY 2023: £107.2m) mainly as a result of the amortisation of acquired intangible assets reducing deferred tax liabilities and the increase of deferred tax assets for other temporary timing differences.
Dividend
The Board is recommending a final dividend of 3.4p per share for the year ended 30 September 2024 (FY 2023: 3.4 pence per share), payable on 11 February 2025 to all shareholders on the register at close of business on 17 January 2025.
Balance sheet
Property, plant and equipment decreased by £1.6m to £32.8m in the year (FY 2023: £34.4m) primarily reflecting depreciation of £6.5m, offset by capital expenditure of £5.7m.
Intangible assets decreased by £125.7m to £1,513.7m (FY 2023: £1,639.4m) driven by amortisation (£77.1m), impairment of acquired intangible assets (£4.5m, see note 9 for further detail) and impact of foreign exchange (£55.2m). This was partially offset by the capitalisation of website development costs (£11.1m).
Trade and other receivables decreased by £8.2m to £115.3m (FY 2023: £123.5m) primarily due to an improvement in cash collection during the year, together with the impact of foreign exchange.
Trade and other payables decreased by £6.7m to £121.7m (FY 2023: £128.4m) due to timing of payments over the year end.
Cash flow and net debt
Net debt at 30 September 2024 was £256.5m (FY 2023: £327.2m), driven by £93.0m of debt repayments (FY 2023: £52.3m, including repayment of overdraft and net of arrangement fees) as well as a decrease in cash related to the share buyback programme which concluded in October 2024.
During the year, there was a cash inflow from operations of £230.0m (FY 2023: £241.0m) reflecting strong cash generation. Adjusted operating cash inflow was £236.2m (FY 2023: £264.5m). A reconciliation of cash generated from operations to adjusted free cash flow is included in the Glossary section at the end of this document.
Other significant movements in cash flows include acquisition of own shares of £63.1m (FY 2023: £24.5m), lease payments of £6.9m (FY 2023: £6.0m) and a dividend in the year of £3.9m (FY 2023: £4.1m). Foreign exchange and other movements accounted for the balance of cash flows.
Going concern
The Group remains highly cash generative - a consistent feature of the Group - with cash generated from operations being £230.0m (FY 2023: £241.0m). After returning £64.7m (FY 2023: £17.2m) to shareholders in the year through the share buyback programme and annual dividend, leverage reduced to 1.1x (FY 2023: 1.3x) and net debt reduced to £256.5m (FY 2023: £327.2m).
The Group has produced forecasts which have been overlaid with several severe but plausible downside scenarios. These scenarios confirm that even in the most severe but plausible downside scenarios, the Group is able to generate profits and positive cash flows.
The scenarios have been modelled using the Group's existing £350m RCF (which reduces to £315m in July 2025 before maturing in July 2026) and the £300m UKEF facility (which amortises over the next three years, with a final bullet payment on expiry in November 2027). The modelling assumes that the RCF remains available throughout the assessment period as the intention is to refinance the facility well before its maturity. However, the Group has also assessed the impact of a dysfunctional market, where the Group is unable to refinance the RCF before its maturity.
The scenarios modelled are hypothetical and purposefully severe with the aim of creating outcomes that have the ability to threaten the viability of the Group. The Group has multiple control measures in place to prevent and mitigate the scenarios from taking place.
At the year end the Group had net current liabilities of £70.3m (FY 2023: £7.4m). This is primarily driven by subscriptions deferred income. The Group has consistently delivered adjusted free cash flow conversion of around 100% and is forecast to generate sufficient cash flows to meet its liabilities as they fall due. The increase in net current liabilities since 30 September 2023 includes the impact of £93.0m debt repayment and £75.3m in respect of the share buyback programme, which reduced cash in the year by £63.1m with a £12.2m other financial liability recognised on the balance sheet at 30 September 2024, as well as £20.0m of debt becoming due within one year.
After due consideration, the Directors have concluded that there is a reasonable expectation that the Group has adequate resources to continue in operational existence for at least twelve months from the date of this report. For this reason, the Directors continue to adopt the going concern basis in preparing the consolidated financial statements for the FY 2024 results.
|
Consolidated income statement |
|
|
|
|
for the year ended 30 September 2024 |
|
|
|
|
|
|
|
|
|
|
Note |
2024 £m |
2023 £m |
|
Revenue |
1,2 |
788.2 |
788.9 |
|
Net operating expenses |
3 |
(654.5) |
(614.4) |
|
Operating profit |
|
133.7 |
174.5 |
|
Finance income |
5 |
1.3 |
0.9 |
|
Finance costs |
5 |
(31.8) |
(37.3) |
|
Net finance costs |
|
(30.5) |
(36.4) |
|
Profit before tax |
|
103.2 |
138.1 |
|
Tax charge |
6 |
(26.4) |
(24.7) |
|
Profit for the year attributable to owners of the parent |
|
76.8 |
113.4 |
|
|
|
|
|
|
Earnings per Ordinary share |
|
||
|
|
Note |
2024 pence |
2023 pence |
|
Basic earnings per share |
8 |
67.2 |
94.7 |
|
Diluted earnings per share |
8 |
66.8 |
94.1 |
|
Consolidated statement of comprehensive income |
|||
|
for the year ended 30 September 2024 |
|||
|
|
|
|
|
|
|
|
2024 £m |
2023 £m |
|
Profit for the year |
76.8 |
113.4 |
|
|
Items that may be reclassified to the consolidated income statement: |
|
|
|
|
Currency translation differences |
(52.7) |
(42.9) |
|
|
(Loss)/gain on cash flow hedge (net of tax) |
|
(4.4) |
4.4 |
|
Other comprehensive expense for the year |
(57.1) |
(38.5) |
|
|
Total comprehensive income for the year attributable to owners of the parent |
19.7 |
74.9 |
|
|
Consolidated statement of changes in equity |
|
for the year ended 30 September 2024 |
|
|
|
Issued share capital £m |
Share premium £m |
Capital redemption reserve £m |
Merger reserve £m |
Treasury reserve £m |
Cash flow hedge reserve £m |
Accumulated exchange differences £m |
Retained earnings £m |
Total equity £m |
|
Note |
||||||||||
|
Balance at 30 September 2022 |
|
18.1 |
197.0 |
- |
581.9 |
(8.0) |
- |
70.7 |
201.0 |
1,060.7 |
|
Profit for the year |
|
- |
- |
- |
- |
- |
- |
- |
113.4 |
113.4 |
|
Currency translation differences |
|
- |
- |
- |
- |
- |
- |
(42.9) |
- |
(42.9) |
|
Gain on cash flow hedge |
|
- |
- |
- |
- |
- |
5.9 |
- |
- |
5.9 |
|
Deferred tax on cash flow hedge |
|
- |
- |
- |
- |
- |
(1.5) |
- |
- |
(1.5) |
|
Other comprehensive income/(expense) for the year |
|
- |
- |
- |
- |
- |
4.4 |
(42.9) |
- |
(38.5) |
|
Total comprehensive income/(expense) for the year |
|
- |
- |
- |
- |
- |
4.4 |
(42.9) |
113.4 |
74.9 |
|
Acquisition of own shares |
15 |
(0.3) |
- |
0.3 |
- |
(11.4) |
- |
- |
(13.5) |
(24.9) |
|
Share schemes |
|
|
|
|
|
|
|
|
|
|
|
- Issue of treasury shares to employees |
16 |
- |
- |
- |
- |
4.1 |
- |
- |
(4.1) |
- |
|
- Share-based payments |
|
- |
- |
- |
- |
- |
- |
- |
7.6 |
7.6 |
|
- Current tax on options |
|
- |
- |
- |
- |
- |
- |
- |
(0.1) |
(0.1) |
|
- Deferred tax on options |
|
- |
- |
- |
- |
- |
- |
- |
0.6 |
0.6 |
|
Dividends paid to shareholders |
7 |
- |
- |
- |
- |
- |
- |
- |
(4.1) |
(4.1) |
|
Balance at 30 September 2023 |
|
17.8 |
197.0 |
0.3 |
581.9 |
(15.3) |
4.4 |
27.8 |
300.8 |
1,114.7 |
|
Profit for the year |
|
- |
- |
- |
- |
- |
|
- |
76.8 |
76.8 |
|
Currency translation differences |
|
- |
- |
- |
- |
- |
- |
(52.7) |
- |
(52.7) |
|
Loss on cash flow hedge |
|
- |
- |
- |
- |
- |
(5.9) |
- |
- |
(5.9) |
|
Deferred tax on cash flow hedge |
|
- |
- |
- |
- |
- |
1.5 |
- |
- |
1.5 |
|
Other comprehensive expense for the year |
|
- |
- |
- |
- |
- |
(4.4) |
(52.7) |
- |
(57.1) |
|
Total comprehensive income/(expense) for the year |
|
- |
- |
- |
- |
- |
(4.4) |
(52.7) |
76.8 |
19.7 |
|
Acquisition of own shares |
15 |
(1.0) |
- |
1.0 |
- |
- |
- |
- |
(76.7) |
(76.7) |
|
Merger reserve reduction |
16 |
- |
- |
- |
(472.9) |
- |
- |
- |
472.9 |
- |
|
Share premium reduction |
16 |
- |
(197.0) |
- |
- |
- |
- |
- |
197.0 |
- |
|
Share schemes |
|
|
|
|
|
|
|
|
|
|
|
- Issue of treasury shares to employees |
16 |
- |
- |
- |
- |
4.4 |
- |
- |
(4.4) |
- |
|
- Share based payments |
|
- |
- |
- |
- |
- |
- |
- |
8.3 |
8.3 |
|
- Current tax on options |
|
- |
- |
- |
- |
- |
- |
- |
(0.5) |
(0.5) |
|
- Deferred tax on options |
|
- |
- |
- |
- |
- |
- |
- |
0.1 |
0.1 |
|
Dividends paid to shareholders |
7 |
- |
- |
- |
- |
- |
- |
- |
(3.9) |
(3.9) |
|
Balance at 30 September 2024 |
|
16.8 |
- |
1.3 |
109.0 |
(10.9) |
- |
(24.9) |
970.4 |
1,061.7 |
|
Consolidated balance sheet |
|
|
|
|
|
As at 30 September 2024 |
|
|
|
|
|
|
Note |
2024 £m |
2023 £m |
|
|
Assets |
|
|
|
|
|
Non-current assets |
|
|
|
|
|
Property, plant and equipment |
|
32.8 |
34.4 |
|
|
Intangible assets - goodwill |
9 |
1,011.7 |
1,053.6 |
|
|
Intangible assets - other |
9 |
502.0 |
585.8 |
|
|
Financial asset - derivative |
14 |
1.4 |
6.0 |
|
|
Deferred tax |
|
1.4 |
- |
|
|
Total non-current assets |
|
1,549.3 |
1,679.8 |
|
|
Current assets |
|
|
|
|
|
Inventories |
|
0.4 |
1.3 |
|
|
Corporation tax recoverable |
|
1.3 |
0.3 |
|
|
Deferred tax |
|
- |
12.8 |
|
|
Trade and other receivables |
|
115.3 |
123.5 |
|
|
Cash and cash equivalents |
|
39.7 |
60.3 |
|
|
Finance lease receivable |
|
2.0 |
3.3 |
|
|
Total current assets |
|
158.7 |
201.5 |
|
|
Total assets |
|
1,708.0 |
1,881.3 |
|
|
Equity and liabilities |
|
|
|
|
|
Equity |
|
|
|
|
|
Issued share capital |
15 |
16.8 |
17.8 |
|
|
Share premium account |
16 |
- |
197.0 |
|
|
Capital redemption reserve |
16 |
1.3 |
0.3 |
|
|
Merger reserve |
16 |
109.0 |
581.9 |
|
|
Treasury reserve |
16 |
(10.9) |
(15.3) |
|
|
Cash flow hedge reserve |
16 |
- |
4.4 |
|
|
Accumulated exchange differences |
16 |
(24.9) |
27.8 |
|
|
Retained earnings |
|
970.4 |
300.8 |
|
|
Total equity |
|
1,061.7 |
1,114.7 |
|
|
Non-current liabilities |
|
|
|
|
|
Financial liabilities - interest-bearing loans and borrowings |
12 |
276.2 |
387.5 |
|
|
Lease liability due in more than one year |
|
29.8 |
35.5 |
|
|
Deferred tax |
|
94.9 |
115.5 |
|
|
Provisions |
13 |
4.7 |
7.2 |
|
|
Deferred income |
|
10.3 |
11.9 |
|
|
Financial liability - derivative |
14 |
1.4 |
0.1 |
|
|
Total non-current liabilities |
|
417.3 |
557.7 |
|
|
Current liabilities |
|
|
|
|
|
Financial liabilities - interest-bearing loans and borrowings |
12 |
20.0 |
- |
|
|
Trade and other payables |
|
121.7 |
128.4 |
|
|
Deferred income |
|
60.2 |
58.5 |
|
|
Corporation tax payable |
|
6.5 |
- |
|
|
Lease liability due within one year |
|
8.4 |
9.3 |
|
|
Other financial liability |
11 |
12.2 |
- |
|
|
Contingent consideration |
|
- |
8.2 |
|
|
Deferred tax |
|
- |
4.5 |
|
|
Total current liabilities |
|
229.0 |
208.9 |
|
|
Total liabilities |
|
646.3 |
766.6 |
|
|
Total equity and liabilities |
|
1,708.0 |
1,881.3 |
|
Consolidated cash flow statement |
|
|
|
|
for the year ended 30 September 2024 |
|
|
|
|
|
|
|
|
|
|
2024 £m |
2023 £m |
|
|
Cash flows from operating activities |
|
|
|
|
Cash generated from operations |
230.0 |
241.0 |
|
|
Net interest paid on bank facilities |
(24.8) |
(22.3) |
|
|
Interest paid on lease liabilities |
(1.7) |
(2.3) |
|
|
Tax paid |
(33.7) |
(33.6) |
|
|
Net cash generated from operating activities |
169.8 |
182.8 |
|
|
Cash flows from investing activities |
|
|
|
|
Purchase of property, plant and equipment |
(2.8) |
(2.0) |
|
|
Purchase of computer software and website development |
(11.1) |
(9.3) |
|
|
Purchase of subsidiary undertakings, net of cash acquired |
(7.9) |
(47.5) |
|
|
Net cash used in investing activities |
(21.8) |
(58.8) |
|
|
Cash flows from financing activities |
|
|
|
|
Acquisition of own shares |
(63.1) |
(24.5) |
|
|
Drawdown of bank loans |
140.0 |
375.1 |
|
|
Repayment of bank loans |
(233.0) |
(416.7) |
|
|
Repayment of overdraft |
- |
(4.2) |
|
|
Bank arrangement fees |
- |
(6.5) |
|
|
Repayment of principal element of lease liabilities |
(6.9) |
(6.0) |
|
|
Dividends paid |
(3.9) |
(4.1) |
|
|
Net cash used in financing activities |
(166.9) |
(86.9) |
|
|
Net (decrease)/increase in cash and cash equivalents |
(18.9) |
37.1 |
|
|
Cash and cash equivalents at beginning of year |
60.3 |
29.2 |
|
|
Effects of exchange rate changes on cash and cash equivalents |
(1.7) |
(6.0) |
|
|
Cash and cash equivalents at end of year |
39.7 |
60.3 |
Notes to the consolidated cash flow statement
for the year ended 30 September 2024
A. Cash generated from operations
The reconciliation of profit for the year to cash generated from operations is set out below:
|
|
2024 £m |
2023 £m |
|
|
Profit for the year |
76.8 |
113.4 |
|
|
Adjustments for: |
|
|
|
|
Depreciation |
6.5 |
8.8 |
|
|
Impairment charge on tangible and intangible assets |
4.7 |
10.3 |
|
|
Gain on exit of leases |
- |
(10.2) |
|
|
Amortisation of intangible assets |
77.1 |
71.0 |
|
|
Share-based payments |
8.3 |
7.6 |
|
|
Net finance costs |
30.5 |
36.4 |
|
|
Tax charge |
26.4 |
24.7 |
|
|
Cash generated from operations before changes in working capital and provisions |
230.3 |
262.0 |
|
|
Decrease in provisions |
(2.8) |
(12.1) |
|
|
Decrease/(increase) in inventories |
0.9 |
(0.1) |
|
|
Decrease in trade and other receivables |
6.2 |
7.6 |
|
|
Decrease in trade and other payables |
(4.6) |
(16.4) |
|
|
Cash generated from operations |
230.0 |
241.0 |
Material accounting policy information
Compliance statement and basis of preparation
Future plc (the Company) is incorporated and registered in England and Wales and is a public company limited by shares. The financial statements consolidate those of Future plc and its subsidiaries (the Group).
The Consolidated Financial Statements have been prepared in accordance with international accounting standards in conformity with the requirements of the Companies Act 2006 and UK adopted IFRSs. The principal accounting policies have been applied consistently to all years presented, unless otherwise stated below. These financial statements have been prepared under the historical cost convention, except for contingent and deferred consideration and financial instruments, which are measured at fair value.
The going concern basis has been adopted in preparing these financial statements.
Status of this preliminary announcement
The financial information contained in this audited preliminary announcement does not constitute the Company's statutory accounts for the years ended 30 September 2024 or 2023. Statutory accounts for 2023, which were prepared in conformity with the requirements of the Companies Act 2006 and UK adopted IFRSs, have been delivered to the Registrar of Companies, and those for 2024 will be delivered in due course. Full financial statements for the year ended 30 September 2024 will shortly be posted to shareholders.
New or revised accounting standards and interpretations adopted in the year
The following amendments to existing standards became effective in the year:
− IAS 1 Amendments regarding the disclosure of accounting policies;
− IAS 8 Amendments regarding the definition of accounting estimates;
− IAS 12 Amendments regarding deferred tax on leases and decommissioning obligations;
− IAS 12 Amendments to provide a temporary exception to the requirements regarding deferred tax assets and liabilities related to Pillar Two corporation taxes.
There has been no material impact from the adoption of new standards, amendments to standards or interpretations which are relevant to the Group.
New accounting standards, amendments and interpretations that are issued but not yet applied by the Group
Certain new standards, amendments and interpretations to existing standards have been published that are mandatory for accounting periods beginning on or after 1 October 2024 and which the Group has chosen not to adopt early. These include the following standards which are relevant to the Group:
− IAS 1 Amendments regarding the classification of liabilities, and Amendment regarding the classification of debt with covenants;
− IAS 7 Amendments regarding supplier finance arrangements;
− IFRS 7 Amendments regarding supplier financial arrangements; and
− IFRS 16 Amendments to clarify how a seller-lessee subsequently measures sale and leaseback transactions.
The Group does not expect that the standards and amendments issued but not yet effective will have a material impact on results or net assets.
Notes
1. Segmental reporting
The Group is organised and arranged primarily by reportable segment. The Executive Directors consider the performance of the business from a geographical perspective, namely the UK and the US. The Australian business is considered to be part of the UK segment and is not reported separately due to its size. The Group also uses a sub-segment split of Media (websites and events) and Magazines for further analysis. The Group considers that the assets within each geographical segment are exposed to the same risks.
(a) Reportable segment
(i) Segment revenue
|
|
Sub-segment |
2024 £m |
Sub-segment |
2023 £m |
||
|
|
Media £m |
Magazines £m |
Total £m |
Media £m |
Magazines £m |
Total £m |
|
Segment: |
|
|
|
|
|
|
|
UK |
316.0 |
188.0 |
504.0 |
280.8 |
195.8 |
476.6 |
|
US |
212.5 |
71.7 |
284.2 |
234.1 |
78.2 |
312.3 |
|
Total |
528.5 |
259.7 |
788.2 |
514.9 |
274.0 |
788.9 |
Transactions between segments are carried out at arm's length.
No end-customer, or other single customer or group of customers under common control contributed 10% or more to the Group's revenue in either the current or prior year. The above analysis excludes the impact of intra-group adjustments.
(ii) Segment adjusted EBITDA:
Adjusted EBITDA is used by the Executive Directors to assess the performance of each segment. The table below shows the impact of intra-group adjustments on the adjusted EBITDA for the UK and US segments:
|
|
|
|
2024 £m |
|
|
2023 £m |
|
|
Adjusted EBITDA prior to intra-group adjustments £m |
Intra-group adjustments £m |
Adjusted EBITDA £m |
Adjusted EBITDA prior to intra-group adjustments £m |
Intra-group adjustments £m |
Adjusted EBITDA £m |
|
UK |
84.0 |
71.3 |
155.3 |
87.1 |
69.9 |
157.0 |
|
US |
155.1 |
(71.3) |
83.8 |
189.7 |
(69.9) |
119.8 |
|
Total |
239.1 |
- |
239.1 |
276.8 |
- |
276.8 |
(iii) Segment adjusted operating profit:
Adjusted operating profit is used by the Executive Directors to assess the performance of each segment. Operating profit for the Media and Magazines sub-segments is not reported internally, as overheads are not fully allocated on this basis. The table below shows the impact of intra-group adjustments on the adjusted operating profit for the UK and US segments:
|
|
|
|
2024 £m |
|
|
2023 £m |
|
|
Adjusted operating profit prior to intra-group adjustments £m |
Intra-group adjustments £m |
Adjusted operating profit £m |
Adjusted operating profit prior to intra-group adjustments £m |
Intra-group adjustments £m |
Adjusted operating profit £m |
|
UK |
70.1 |
71.3 |
141.4 |
70.6 |
69.9 |
140.5 |
|
US |
152.1 |
(71.3) |
80.8 |
185.8 |
(69.9) |
115.9 |
|
Total |
222.2 |
- |
222.2 |
256.4 |
- |
256.4 |
Intra-group adjustments relate to the net impact of charges from the UK to the US in respect of management fees (for back office revenue functions such as finance, HR and IT which are largely based in the UK) and licence fees for the use of intellectual property.
2. Revenue
The Group applies IFRS 15 Revenue from contracts with customers. See note 1 for disaggregation of revenue by sub-segment.
Timing of satisfaction of performance obligations
Revenue is recognised in the income statement when control passes to the customer. If the customer simultaneously receives and consumes the benefits of the contract, revenue is recognised over time. Otherwise, revenue is recognised at a point in time.
The table below disaggregates revenue according to the timing of satisfaction of performance obligations:
|
|
|
|
2024 |
|
|
2023 |
|
|
Over time £m |
Point in time £m |
Total revenue £m |
Over time £m |
Point in time £m |
Total revenue £m |
|
Total revenue |
15.1 |
773.1 |
788.2 |
17.4 |
771.5 |
788.9 |
The table below disaggregates revenue according to segment with a breakdown of revenue by type within each segment:
|
|
2024 £m |
2023 £m |
|
Advertising and other |
78.8 |
86.9 |
|
eCommerce affiliates |
237.2 |
193.9 |
|
Media |
316.0 |
280.8 |
|
Magazines |
188.0 |
195.8 |
|
Total UK |
504.0 |
476.6 |
|
Advertising & other |
146.4 |
159.1 |
|
eCommerce affiliates |
66.1 |
75.0 |
|
Media |
212.5 |
234.1 |
|
Magazines |
71.7 |
78.2 |
|
Total US |
284.2 |
312.3 |
|
|
|
|
|
Advertising & other |
225.2 |
246.0 |
|
eCommerce affiliates |
303.3 |
268.9 |
|
Media |
528.5 |
514.9 |
|
Magazines |
259.7 |
274.0 |
|
Total Revenue |
788.2 |
788.9 |
3. Net operating expenses
Operating profit is stated after charging:
|
|
|
|
2024 £m |
2023 £m |
|
Cost of sales |
(433.8) |
(400.6) |
||
|
Distribution expenses |
(37.8) |
(40.0) |
||
|
Share-based payments (including social security costs) |
(8.9) |
(7.8) |
||
|
Exceptional items (note 4) |
(7.0) |
(7.3) |
||
|
Depreciation |
(6.5) |
(8.8) |
||
|
Amortisation (note 9) |
(77.1) |
(71.0) |
||
|
Other administration expenses |
(83.4) |
(78.9) |
||
|
|
|
|
(654.5) |
(614.4) |
Other administration expenses include Transaction and integration costs of £5.9m (2023: £7.4m). Details of these costs are provided in the Glossary section at the end of this document.
During the year to 30 September 2024, the Group refined its policy for allocating costs between cost of sales and overheads. This change in presentation has been applied prospectively. Applying the same methodology to the prior year comparatives would increase costs of sales and reduce other administration expenses by £5.9m respectively.
4. Exceptional items
|
|
2024 £m |
2023 £m |
|
Impairment of acquired intangible assets |
4.5 |
- |
|
Onerous property costs |
1.7 |
0.9 |
|
Restructuring costs |
0.8 |
6.4 |
|
Total charge |
7.0 |
7.3 |
Exceptional costs incurred in the year include a £4.5m impairment of acquired intangible assets following brand closures in the year, primarily relating to iMore, a brand acquired as part of the Mobile Nations acquisition in 2019, £1.7m (2023: £0.9m) relating to properties which became onerous and were treated as exceptional in prior years and £0.8m (2023: £6.4m) relating to restructuring costs.
For the tax and cash flow impact of exceptional items see the Glossary section at the end of this document.
5. Finance income and costs
|
|
2024 £m |
2023 £m |
|
Interest payable on interest-bearing loans and borrowings |
(25.9) |
(29.7) |
|
Amortisation of bank loan arrangement fees |
(3.9) |
(3.7) |
|
Interest payable on lease liabilities |
(1.8) |
(2.6) |
|
Increase in fair value of contingent consideration |
- |
(0.6) |
|
Unwinding of discount on deferred/contingent consideration |
(0.2) |
(0.7) |
|
Total finance costs |
(31.8) |
(37.3) |
|
|
|
|
|
Interest receivable from cash held on deposit |
1.2 |
0.7 |
|
Interest receivable on lease assets |
0.1 |
0.2 |
|
Total finance income |
1.3 |
0.9 |
|
Net finance costs |
(30.5) |
(36.4) |
For further information in respect of the Group's debt facilities and changes during the year see note 12.
6. Tax on profit
The tax charged/(credited) in the consolidated income statement is analysed below:
|
|
2024 £m |
2023 £m |
|
Corporation tax |
|
|
|
Current tax on the profit for the year |
45.8 |
49.5 |
|
Adjustments in respect of previous years |
(7.9) |
(5.2) |
|
Current tax charge |
37.9 |
44.3 |
|
Deferred tax origination and reversal of temporary differences |
|
|
|
Current year gain |
(20.9) |
(15.0) |
|
Adjustments in respect of previous years |
9.4 |
(4.6) |
|
Deferred tax credit |
(11.5) |
(19.6) |
|
Total tax charge |
26.4 |
24.7 |
The adjustments in respect of previous years relate to estimation revisions identified when preparing the current year tax provision due to new information becoming available when the Group completed its tax returns, as well as the correction of a number of immaterial items.
The tax assessed in each year differs from the standard rate of corporation tax in the UK for the relevant year. The differences are explained below:
|
|
2024 £m |
2023 £m |
|
Profit before tax |
103.2 |
138.1 |
|
Profit before tax at the standard UK tax rate of 25% (2023: 22%) |
25.8 |
30.4 |
|
Expenses not deductible for tax purposes |
0.1 |
1.5 |
|
Provision for uncertain tax positions |
(3.9) |
- |
|
Non-deductible amortisation |
1.7 |
(0.4) |
|
Share-based payments |
0.1 |
0.1 |
|
Effect of different rates of subsidiaries operating in other jurisdictions |
1.1 |
3.4 |
|
Effect of change in tax rate |
- |
(0.5) |
|
Adjustments in respect of previous years |
1.5 |
(9.8) |
|
Total tax charge |
26.4 |
24.7 |
A reconciliation between the statutory and adjusted tax charge is provided in the Glossary section at the end of this document.
The Directors have assessed the Group's uncertain tax positions and have recorded a provision of £1.4m (2023: £5.3m). The provision for uncertain tax positions has been recognised under IAS 12, taking into account the guidance published in IFRIC 23.
7. Dividends
|
Equity dividends |
2024 |
2023 |
|
Number of shares in issue at end of period (million) |
112.1 |
119.1 |
|
Dividends paid in year (pence per share) |
3.4 |
3.4 |
|
Dividends paid in year (£m) |
3.9 |
4.1 |
Final dividends are recognised in the year in which they are approved.
On 4 December the Board proposed a dividend of 3.4p per share, totalling an estimated £3.8m, in respect of the year ended 30 September 2024, which subject to shareholder consent at the AGM, will be paid on 11 February 2025 to shareholders on the register at close of business on 17 January 2025.
A dividend of 3.4p per share totalling £3.9m in respect of the year ended 30 September 2023 was paid on 13 February 2024.
8. Earnings per share
|
|
2024 |
2023 |
|
Profit attributable to owners of the parent (£m) |
76.8 |
113.4 |
|
Weighted average number of shares in issue during the year |
114,355,263 |
119,786,409 |
|
Dilution (number of shares) |
696,450 |
763,756 |
|
Diluted weighted average number of shares in issue during the year |
115,051,713 |
120,550,165 |
|
Basic earnings per share (p) |
67.2 |
94.7 |
|
Diluted earnings per share (p) |
66.8 |
94.1 |
Basic earnings per share are calculated using the weighted average number of Ordinary shares in issue during the year. Diluted earnings per share have been calculated by taking into account the dilutive effect of shares that would be issued on conversion into Ordinary shares of awards held under employee share schemes.
A reconciliation between earnings per share and adjusted earnings per share is shown in the Glossary at the end of this document.
9. Intangible assets
|
|
Goodwill £m |
Publishing rights £m |
Brands £m |
Customer relationships £m |
Subscribers £m |
Advertiser relationships £m |
Other acquired intangibles £m |
Other £m |
Total £m |
|
Cost |
|
|
|
|
|
|
|
|
|
|
At 1 October 2022 |
1,340.2 |
90.9 |
501.6 |
57.8 |
86.4 |
22.9 |
43.5 |
59.2 |
2,202.5 |
|
Additions through business combinations |
29.2 |
- |
10.5 |
7.4 |
- |
- |
2.0 |
- |
49.1 |
|
Other additions |
- |
- |
- |
- |
- |
- |
- |
9.3 |
9.3 |
|
Exchange adjustments |
(49.1) |
(0.3) |
(14.9) |
(1.7) |
(4.8) |
(1.8) |
(1.5) |
(1.3) |
(75.4) |
|
At 30 September 2023 |
1,320.3 |
90.6 |
497.2 |
63.5 |
81.6 |
21.1 |
44.0 |
67.2 |
2,185.5 |
|
Other additions |
- |
- |
- |
- |
- |
- |
- |
11.1 |
11.1 |
|
Exchange adjustments |
(45.7) |
(0.2) |
(13.0) |
(1.5) |
(4.2) |
(1.6) |
(1.2) |
(1.1) |
(68.5) |
|
At 30 September 2024 |
1,274.6 |
90.4 |
484.2 |
62.0 |
77.4 |
19.5 |
42.8 |
77.2 |
2,128.1 |
|
Accumulated amortisation and impairment |
|
|
|
|
|
|
|
|
|
|
At 01 October 2022 |
(270.6) |
(29.9) |
(63.1) |
(22.7) |
(17.1) |
(3.0) |
(33.1) |
(47.2) |
(486.7) |
|
Charge for the year |
- |
(6.4) |
(28.7) |
(8.6) |
(9.7) |
(1.7) |
(4.3) |
(11.6) |
(71.0) |
|
Exchange adjustments |
3.9 |
0.2 |
3.0 |
0.7 |
1.2 |
0.2 |
1.2 |
1.2 |
11.6 |
|
At 30 September 2023 |
(266.7) |
(36.1) |
(88.8) |
(30.6) |
(25.6) |
(4.5) |
(36.2) |
(57.6) |
(546.1) |
|
Charge for the year |
- |
(5.9) |
(32.3) |
(13.4) |
(9.3) |
(1.6) |
(4.2) |
(10.4) |
(77.1) |
|
Impairment |
- |
(0.5) |
(4.0) |
- |
- |
- |
- |
- |
(4.5) |
|
Exchange adjustments |
3.8 |
0.3 |
3.9 |
1.0 |
1.8 |
0.3 |
1.0 |
1.2 |
13.3 |
|
At 30 September 2024 |
(262.9) |
(42.2) |
(121.2) |
(43.0) |
(33.1) |
(5.8) |
(39.4) |
(66.8) |
(614.4) |
|
|
|
|
|
|
|
|
|
|
|
|
Net book value at 30 September 2024 |
1,011.7 |
48.2 |
363.0 |
19.0 |
44.3 |
13.7 |
3.4 |
10.4 |
1,513.7 |
|
Net book value at 30 September 2023 |
1,053.6 |
54.5 |
408.4 |
32.9 |
56.0 |
16.6 |
7.8 |
9.6 |
1,639.4 |
|
Net book value at 1 October 2022 |
1,069.6 |
61.0 |
438.5 |
35.1 |
69.3 |
19.9 |
10.4 |
12.0 |
1,715.8 |
|
Useful economic lives |
|
5-15 years |
3-20 years |
8-10 years |
7-11 years |
9-15 years |
3-10 years |
2 years |
|
The impairment during FY 2024 primarily relates to the closure of the iMore brand, see note 4.
The amortisation charge for the year includes £11.0m accelerated amortisation of the Look After My Bills ('LAMB') brand and customer lists, arising from the Go.Compare acquisition. The useful economic lives of the LAMB assets were reduced during the year, with the revised lives ending on 30 September 2024, following the cessation of active management of the business, which by 30 September 2024 was closed.
Acquired intangibles are amortised over their estimated economic lives, typically ranging between three and twenty years. The other acquired intangibles category in the table above includes assets relating to customer lists, content and websites.
Any residual amount arising as a result of the purchase consideration being in excess of the value of acquired assets is recorded as goodwill.
Other intangibles relate to capitalised software costs and website development costs which are internally generated.
Additions through business combinations totalling £49.1m in the prior year related to the acquisition of ActualTech LLC, a provider of content marketing solutions for B2B marketers, and Gardening Know How, a specialist interest site for gardening based in the US.
Amortisation is included within administration expenses in the consolidated income statement.
10. Cash and cash equivalents
Cash and cash equivalents include the following for the purposes of the cash flow statements:
|
|
2024 £m |
|
2023 £m |
|
|
Cash and cash equivalents |
39.7 |
|
60.3 |
|
The decrease in cash is principally due to £93.0m of debt repayments as well as the share buyback programme with a cash spend of £63.1m in the year (see notes 15 and 16 for further detail).
The Group has a number of authorised counterparties with whom cash balances are held in the countries in which the Group operates. Credit risk is minimised by considering the credit standing of all potential counterparties before selecting them by the use of external credit ratings. Over 99.9% of the Group's cash and cash equivalent balance was held with counterparties with a minimum S&P credit rating of A-. The Group monitors the exposure, credit rating and outlook of all financial counterparties on a regular basis.
11. Other financial liability
|
|
2024 £m |
2023 £m |
|
Other financial liability |
12.2 |
- |
The other financial liability relates to an obligation at 30 September 2024 for the Group to purchase own shares under the terms of its buyback agreement. The share buyback concluded on 21st October 2024.
12. Financial liabilities - interest-bearing loans and borrowings
Amounts drawn down on the Group's borrowing facilities, net of unamortised issue costs are as follows. All borrowings are floating rate with the applicable rates at 30 September shown below. This excludes the impact of any interest rate swaps.
Non-current liabilities
|
|
Interest rate at 30 September 2024 |
Interest rate at 30 September 2023 |
2024 £m |
2023 £m |
|
Export development guarantee term facility |
6.39% |
7.04% |
276.2 |
295.2 |
|
US dollar revolving loan |
- |
7.43% |
- |
81.8 |
|
AUS dollar revolving loan |
- |
6.06% |
- |
10.5 |
|
Total |
|
|
276.2 |
387.5 |
Current liabilities
|
|
Interest rate at 30 September 2024 |
Interest rate at 30 September 2023 |
Group 2024 £m |
Group 2023 £m |
|
External development guarantee term facility |
6.39% |
1.00% |
20.0 |
- |
|
Total |
|
|
20.0 |
- |
The interest-bearing liabilities are repayable as follows:
|
|
2024 £m |
2023 £m |
|
Within one year |
20.0 |
- |
|
Between one and two years |
130.0 |
20.0 |
|
Between two and five years |
146.2 |
367.5 |
|
Total |
296.2 |
387.5 |
Following a review of its committed facilities and expected utilisation the Group reduced the commitments on its Revolving Credit Facility ('RCF') from £500.0m to £350.0m on 16 February 2024 and on its Export Development Guarantee ('EDG') term facility from £400.0m to £300.0m on 29 February 2024. At 30 September 2024, 53.8% (£300.0m of £650.0m) of the Group's facilities remained undrawn (30 September 2023: 56.1% (£504.8m of £900.0m) undrawn).
Interest bearing loans are shown net of unamortised issue costs which amounted to £3.8m (2023: £7.7m).
In 2023 the Group entered into interest rate swap agreements which swap the interest profile on an notional £300.0m of the Group's EDG term facility to mitigate the risk of fluctuations in interest rates whereby it receives a variable interest rate based on SONIA and pays fixed rates of between 3.720% and 4.987%. As at 30 September 2024, 100% (30 September 2023: 76%) of the Group's drawn floating rate debt was hedged.
13. Provisions
|
|
Property £m |
Other £m |
Total £m |
|
At 1 October 2023 |
6.7 |
0.5 |
7.2 |
|
Charged in the year |
1.2 |
0.4 |
1.6 |
|
Utilised in the year |
(3.4) |
(0.7) |
(4.1) |
|
At 30 September 2024 |
4.5 |
0.2 |
4.7 |
The property provision relates to dilapidations and obligations under short leasehold agreements on vacant property. The majority of the vacant property provision is expected to be utilised over the next three years.
14. Financial instruments
The Group applies IFRS 9 Financial Instruments. For the Group's financial assets and liabilities, the following table shows the measurement categories under IFRS 9:
|
Financial asset |
IFRS 9 classification |
|
Cash and cash equivalents |
Amortised cost |
|
Trade and other receivables |
Amortised cost |
|
Interest bearing loans and borrowings |
Amortised cost |
|
Lease liabilities |
Amortised cost |
|
Other financial liability |
Amortised cost |
|
Contingent consideration |
Fair value through profit or loss |
|
Derivative - interest rate swap |
Fair value through profit or loss |
There has not been a significant impact on the carrying amounts of assets held.
Financial asset - derivative
The Group has exposure to changes in cash flows due to changes in interest rates. The Group has entered into interest rate swap agreements which swap the interest profile on a notional £300.0m (30 September 2023: £300.0m) of the Group's EDG term facility to mitigate the risk of fluctuations in interest rates, whereby it receives a variable interest rate based on SONIA and pays fixed rates of between 3.720% and 4.987%. The swaps have been valued based on the present value of the estimated future cash flows based on observable yield curves. An asset and liability both equalling £1.4m have been recognised on the balance sheet at 30 September 2024 (30 September 2023: net assets of £5.9m) with a corresponding decrease of £4.4m in the cash flow hedge reserve (see note 16 for further details).
At 30 September 2023 contingent consideration of £8.2m ($10.0m) related to the acquisition of ActualTech, LLC, which was paid in full on 31 January 2024 (being £7.9m after the impact of foreign exchange on settlement).
There was no ineffectiveness to be recorded from the use of interest rate swaps. The Group did not enter into any netting arrangements.
The following table presents the Group's financial assets and liabilities that are measured at fair value at 30 September 2024:
|
Financial asset |
|
Level 2 Fair value £m |
|
Asset |
|
|
|
Financial asset - derivatives |
|
1.4 |
|
Liabilities |
|
|
|
Financial liability - derivatives |
|
(1.4) |
All other financial assets and liabilities are classed as level 1. There are no Level 3 financial assets or liabilities at 30 September 2024.
15. Issued share capital
|
|
Number of |
2024 £m |
Number of |
2023 £m |
|
shares |
shares |
|||
|
Allotted, authorised, issued and fully paid Ordinary shares of 15p each |
|
|
|
|
|
At 1 October |
119,077,135 |
17.8 |
120,855,930 |
18.1 |
|
Share buyback |
(6,992,733) |
(1.0) |
(1,784,349) |
(0.3) |
|
Share Incentive Plan matching shares |
3,624 |
- |
5,554 |
- |
|
At 30 September |
112,088,026 |
16.8 |
119,077,135 |
17.8 |
During the year, 3,624 Ordinary shares were issued under the Share Incentive Plan for a combined total cash commitment of £nil (FY 2023: 5,554 ordinary shares, total cash commitment of £nil).
During the year the Group undertook a further share buyback programme, resulting in a reduction in share capital of 7.0m shares in the year (FY 2023: 1.8m shares), at a nominal value of £1.0m and a total cost of £63.1m.
16. Reserves
Share premium account
Share premium represents the excess of proceeds received over the nominal value of new shares issued.
In order to create additional distributable reserves to provide flexibility for shareholder returns, during the year the total share premium reserve of Future plc of £197.0m was cancelled and credited to the reserves of Future plc, increasing distributable reserves by the same amount. The balance at 30 September 2024 is £nil.
See 'Merger reserve' section below for further detail.
Treasury reserve
The treasury reserve represents the cost of shares in Future plc purchased in the market and held by the Employee Benefit Trust ('EBT') to satisfy awards made by the Trustees.
During the year the Company purchased none (30 September 2023: 1,125,000) of its own shares to fund the future vesting of share options, at a total value of nil (FY 2023: £11.4m) and 286,795 shares held by the EBT were used to satisfy the vesting of share options at a total value of £4.4m (FY 2023: 259,918 shares were purchased, at a total value of £4.1m).
Capital redemption reserve
The capital redemption reserve increased by £1.0m (FY 2023: £0.3m) during the year to £1.3m, being the nominal value of shares purchased and cancelled as part of the share buyback programme (see note 15 for further details).
Merger reserve
In order to create additional distributable reserves to provide flexibility for shareholder returns, during the year the total value of the Future plc merger reserve of £472.9m was capitalised, with B ordinary shares issued at a total nominal value equal to £472.9m, then cancelled and extinguished, with £472.9m credited to retained earnings, increasing distributable reserves by the same amount.
An amount of £109.0m in the merger reserve arose in previous years following the 1999 Group reorganisation and is non-distributable.
Treasury reserve
The treasury reserve represents the cost of shares in Future plc purchased in the market and held by the Employee Benefit Trust ('EBT') to satisfy awards made by the trustees.
During the year, 286,795 (2023: 259,918) of the shares held by the EBT were used to satisfy the vesting of share options and no shares were purchased to fund the future vesting of share options (2023: 1,125,000 shares were purchased to fund the future vesting of share options at a total value of £11.4m).
Cash flow hedge reserve
During 2023 the Group entered into interest rate swaps, in order to hedge against fluctuations in interest rates. The cash flow hedge reserve represents the cumulative amount of gains and losses on the interest rate swap deemed effective.
Accumulated exchange differences
The reserve for accumulated exchange differences comprises the revaluation of the Group's foreign currency entities, principally the US and Australia, on consolidation.
17. Contingent liabilities
There were no material contingent liabilities as at 30 September 2024 or 30 September 2023.
18. Related party transactions
The Group had no material transactions with related parties in 2024 or 2023 which might reasonably be expected to influence decisions made by users of these financial statements.
19. Events after the reporting period
On 4 December 2024 the Board approved a share buyback of up to £55.0m, which is expected to commence in January 2025.
GLOSSARY
Presentation of non-statutory measures
The Directors believe that adjusted results and adjusted earnings per share provide additional useful information on the core operational performance of the Group to shareholders, and review the results of the Group on an adjusted basis internally. The term 'adjusted' is not a defined term under IFRS and may not therefore be comparable with similarly titled profit measurements reported by other companies. It is not intended to be a substitute for, or superior to, IFRS measurements of profit.
Adjustments are made in respect of:
|
Adjusting item |
Explanation |
|
Share-based payments |
Share-based payment expenses (relating to equity-settled share awards with vesting periods longer than 12 months), together with associated social security costs, are excluded from the adjusted results of the Group as the Directors believe they result in a level of charge that would distort the user's view of the core trading performance of the Group. |
|
Transaction and integration related costs |
Although transactions are a key part of the Group's strategy, the Group adjusts for costs relating to the completion and subsequent integration of acquisitions and other corporate transactions, initiated within 12 months of the completion date, as these costs are not related to the core trading of the Group and not doing so would distort the Group's results, so as to assist the user of the financial statements to understand the results of the core underlying operations of the Group. Details of transaction and integration related costs are shown within the Glossary section. |
|
Exceptional items |
The Group considers items of income and expense as exceptional and excludes them from the adjusted results where the nature of the item, or its size, is significant and/or is not related to the core trading of the Group so as to assist the user of the financial statements to understand the results of the core underlying operations of the Group. Details of exceptional items are shown in note 4. |
|
Amortisation of acquired intangible assets |
The amortisation charge for those intangible assets recognised on business combinations is excluded from the adjusted results of the Group since they are non-cash charges arising from non-trading investment activities. As such, they are not considered to be reflective of the core trading performance of the Group. This is consistent with industry peers and how certain external stakeholders monitor the performance of the business. |
|
Amortisation of non acquired intangible assets, depreciation and interest |
Adjusted EBITDA excludes the amortisation charge for computer software and website development, as well as amortisation of acquired intangible assets, depreciation and interest. |
|
Unwinding of discount on contingent consideration |
The Group excludes the unwinding of the discount on contingent consideration from the Group's adjusted results on the basis that it is non-cash and the balance is driven by the Group's assessment of the relevant discount rate to apply. Excluding this item ensures comparability with prior periods.
|
|
Change in the fair value of contingent consideration |
The Group excludes the remeasurement of these acquisition-related liabilities from its adjusted results as the impact of remeasurement can vary significantly. |
The tax related to adjusting items is the tax effect of the items above and adjustments in respect of prior years, calculated using the standard rate of corporation tax in the relevant jurisdiction.
Reference to 'core' or 'underlying' reflects the trading results of the Group without the impact of amortisation of acquired intangible assets, transaction and integration related costs, exceptional items, share-based payment expenses (relating to equity-settled share awards with vesting periods longer than 12 months), together with associated social security costs, unwinding of discount on contingent consideration and any tax related effects that would otherwise distort the users understanding of the Group's performance
A summary table of all measures is included below:
|
APM (adjusted performance measure) |
Closest equivalent statutory measure |
Definition |
|
Adjusted EBITDA |
Operating profit |
Adjusted EBITDA represents operating profit before share-based payments (relating to equity-settled awards with vesting periods longer than 12 months) and related social security costs, amortisation, depreciation, transaction and integration related costs and exceptional items.
Adjusted EBITDA margin is adjusted EBITDA as a percentage of revenue.
Adjusting items are shown in the table below and defined in the table above. |
|
Adjusted operating profit |
Operating profit |
Adjusted operating profit represents operating profit before share-based payments (relating to equity-settled awards with vesting periods longer than 12 months) and related social security costs, amortisation of acquired intangible assets, transaction and integration related costs and exceptional items.
This is a key management incentive metric, used within the Group's Deferred Annual Bonus Plan.
Adjusted operating profit margin is adjusted operating profit as a percentage of revenue.
Adjusting items are shown in the table below and defined in the table above. |
|
Adjusted profit before tax |
Profit before tax |
Adjusted profit before tax represents profit before tax before share-based payments (relating to equity-settled awards with vesting periods longer than 12 months) and related social security costs, net finance costs, amortisation of acquired intangible assets, transaction and integration related costs, exceptional items, unwinding of discount on contingent consideration and change in fair value of contingent consideration.
Adjusting items are shown in the table below and defined in the table above. |
|
Adjusted diluted earnings per share |
Diluted earnings per share |
Adjusted diluted earnings per share (EPS) represents adjusted profit after tax divided by the weighted average dilutive number of shares at the year end date.
This is a key management incentive metric, used within the Group's Performance Share Plan.
A reconciliation is provided within the Glossary. |
|
Adjusted effective tax rate |
Effective tax rate |
Adjusted effective tax rate is defined as the effective tax rate adjusted for the tax impact of adjusting items and any other one-off impacts, including adjustments in respect of previous years. The tax impact of adjusting items is provided within the Glossary. |
|
Adjusted operating cash flow |
Operating cash flow |
Adjusted operating cash flow represents cash generated from operations adjusted to exclude cash flows relating to transaction and integration related costs, exceptional items and payment of accrual for employer's taxes on share-based payments relating to equity settled share awards with vesting periods longer than 12 months, and to include lease repayments following adoption of IFRS 16 Leases.
|
|
Adjusted free cash flow |
Operating cash flow |
Adjusted free cash flow is defined as adjusted operating cash flow less capital expenditure. Capital expenditure is defined as cashflows relating to the purchase of property, plant and equipment and purchase of computer software and website development. |
|
Net debt |
The aggregation of cash and debt |
Net debt is defined as the aggregate of the Group's cash and cash equivalents and its external bank borrowings net of capitalised bank arrangement fees. It does not include lease liabilities recognised following the adoption of IFRS 16 Leases, or other financial liabilities. |
|
Organic growth |
|
Organic growth is defined as the like for like portfolio, including the impact of closures and new launches, but excluding acquisitions and disposals made during FY 2024 and FY 2023 at constant foreign exchange rates. Constant foreign exchange rates is defined as the average rate for FY 2024. |
|
Constant currency |
|
Constant currency translates the financial statements at fixed exchange rates to eliminate the effect of foreign exchange on the financial performance. Constant foreign exchange rates is defined as the average rate for FY 2024. |
Reconciliation between revenue and organic revenue at constant currency:
|
|
2024 £m |
2023 £m |
YoY Var |
|
Total revenue |
788.2 |
788.9 |
0% |
|
Revenue from FY 2023 acquisitions which have not been acquired for a full financial year |
(13.6) |
(13.7) |
|
|
Organic revenue at actual currency |
774.6 |
775.2 |
|
|
Impact of FX at constant rates |
- |
(11.8) |
|
|
Organic revenue |
774.6 |
763.4 |
1% |
A reconciliation of adjusted EBITDA and adjusted operating profit to profit before tax is shown below:
|
|
2024 £m |
2023 £m |
|
Adjusted EBITDA |
239.1 |
276.8 |
|
Depreciation |
(6.5) |
(8.8) |
|
Amortisation of non-acquired intangibles (note 9) |
(10.4) |
(11.6) |
|
Adjusted operating profit |
222.2 |
256.4 |
|
Share-based payments (including social security costs) |
(8.9) |
(7.8) |
|
Transaction and integration related costs |
(5.9) |
(7.4) |
|
Exceptional items (note 4) |
(7.0) |
(7.3) |
|
Amortisation of acquired intangibles (note 9) |
(66.7) |
(59.4) |
|
Operating profit |
133.7 |
174.5 |
|
Net finance costs (note 5) |
(30.5) |
(36.4) |
|
Profit before tax |
103.2 |
138.1 |
A breakdown of transaction and integration related costs is shown in the table below:
|
|
2024 £m |
2023 £m |
|
Transaction and integration related costs |
5.9 |
6.5 |
|
Onerous property costs |
- |
0.9 |
|
Total charge |
5.9 |
7.4 |
Transaction and integration related costs of £5.9m incurred in the year reflect £3.5m of professional fees to support portfolio optimisation across the Group's divisions, £1.6m of post-integration IT system costs and associated fees and £0.8m of transaction-related legal fees (2023: £5.3m of deal-related fees, £2.0m of restructuring costs net of £0.8m released following settlement of provision for historical legal claims recognised on the Dennis opening balance sheet, and £0.9m onerous property costs).
Included below is a reconciliation between the statutory and adjusted tax charge:
|
|
2024 £m |
2023 £m |
|
Total statutory tax charge |
26.4 |
24.7 |
|
Tax effect of adjusting items: |
|
|
|
Exceptional items |
1.0 |
1.9 |
|
Transaction and integration related costs |
1.5 |
0.3 |
|
Share based payments |
2.3 |
(0.1) |
|
Amortisation of acquired intangibles |
15.6 |
14.8 |
|
Adjustments in respect of previous years |
2.5 |
9.8 |
|
Total adjusted tax charge |
49.3 |
51.4 |
A reconciliation of cash generated from operations to adjusted free cash flow is shown below:
|
|
2024 £m |
2023 £m |
|
Cash generated from operations |
230.0 |
241.0 |
|
Cash flows related to transaction and integration related costs |
7.5 |
15.6 |
|
Cash flows related to exceptional items |
5.3 |
13.4 |
|
Settlement of social security costs on share based payments¹ |
0.3 |
0.5 |
|
Lease payments |
(6.9) |
(6.0) |
|
Adjusted operating cash inflow |
236.2 |
264.5 |
|
Cash flows related to capital expenditure |
(13.9) |
(11.3) |
|
Adjusted free cash flow |
222.3 |
253.2 |
¹ Relating to equity-settled share awards with vesting periods longer than 12 months.
A reconciliation between earnings per share and adjusted earnings per share is shown in the table below:
|
|
|
|
|
|
2024 |
2023 |
|
Adjustments to profit after tax: |
|
|
||||
|
Profit after tax (£m) |
76.8 |
113.4 |
||||
|
Share-based payments (including social security costs) (£m) |
8.9 |
7.8 |
||||
|
Transaction and integration related costs (£m) |
5.9 |
7.4 |
||||
|
Exceptional items (£m) |
|
|
|
|
7.0 |
7.3 |
|
Amortisation of intangible assets arising on acquisitions (£m) |
66.7 |
59.4 |
||||
|
(Decrease)/increase in fair value of contingent consideration (£m) |
(0.1) |
0.6 |
||||
|
Unwinding of discount on contingent consideration (£m) |
- |
0.7 |
||||
|
Unwinding of discount on deferred consideration (£m) |
0.2 |
- |
||||
|
Tax effect of the above adjustments and the impact of tax items relating to prior years (£m) |
(22.9) |
(26.7) |
||||
|
Adjusted profit after tax (£m) |
142.5 |
169.9 |
||||
|
Weighted average number of shares in issue during the year: |
|
|
||||
|
- Basic |
114,355,263 |
119,786,409 |
||||
|
- Dilutive effect of share options |
696,450 |
763,756 |
||||
|
- Diluted |
115,051,713 |
120,550,165 |
||||
|
Basic earnings per share (in pence) |
67.2 |
94.7 |
||||
|
Adjusted basic earnings per share (in pence) |
124.6 |
141.8 |
||||
|
Diluted earnings per share (in pence) |
66.8 |
94.1 |
||||
|
Adjusted diluted earnings per share (in pence) |
123.9 |
140.9 |
||||
|
The adjustments to profit after tax have the following effect: |
|
|
||||
|
Basic earnings per share (pence) |
67.2 |
94.7 |
||||
|
Share-based payments (including social security costs) (pence) |
7.8 |
6.5 |
||||
|
Transaction and integration related costs |
5.2 |
6.2 |
||||
|
Exceptional items (pence) |
6.1 |
6.1 |
||||
|
Amortisation of intangible assets arising on acquisitions (pence) |
58.3 |
49.6 |
||||
|
(Decrease)/increase in fair value of contingent consideration (pence) |
(0.1) |
0.5 |
||||
|
Unwinding of discount on contingent consideration (pence) |
- |
0.6 |
||||
|
Unwinding of discount on deferred consideration (pence) |
0.2 |
- |
||||
|
Tax effect of the above adjustments and the impact of tax items relating to prior years (pence) |
(20.1) |
(22.4) |
||||
|
Adjusted basic earnings per share (pence) |
124.6 |
141.8 |
||||
|
Diluted earnings per share (pence) |
66.8 |
94.1 |
||||
|
Share-based payments (including social security costs) (pence) |
7.7 |
6.5 |
||||
|
Transaction and integration related costs |
5.1 |
6.1 |
||||
|
Exceptional items (pence) |
6.1 |
6.1 |
||||
|
Amortisation of intangible assets arising on acquisitions (pence) |
58.0 |
49.3 |
||||
|
(Decrease)/iIncrease in fair value of contingent consideration (pence) |
(0.1) |
0.5 |
||||
|
Unwinding of discount on contingent consideration (pence) |
- |
0.6 |
||||
|
Unwinding of discount on deferred consideration (pence) |
0.2 |
- |
||||
|
Tax effect of the above adjustments and the impact of tax items relating to prior years (pence) |
(19.9) |
(22.3) |
||||
|
Adjusted diluted earnings per share (pence) |
123.9 |
140.9 |
||||
Analysis of net debt
|
|
|
30 September 2023 £m |
Net cash flows £m |
Other non-cash changes £m |
Exchange movements £m |
30 September 2024 £m |
|
Cash and cash equivalents |
60.3 |
(18.9) |
- |
(1.7) |
39.7 |
|
|
Debt due within one year |
- |
- |
(20.0) |
- |
(20.0) |
|
|
Debt due after more than one year |
(387.5) |
93.0 |
16.1 |
2.2 |
(276.2) |
|
|
Net debt |
(327.2) |
74.1 |
(3.9) |
0.5 |
(256.5) |
|
|
|
|
30 September 2022 £m |
Net cash flows £m |
On acquisition £m |
Other non-cash changes £m |
Exchange movements £m |
30 September 2023 £m |
|
Cash and cash equivalents |
29.2 |
33.0 |
4.1 |
- |
(6.0) |
60.3 |
|
|
Debt due within one year |
(83.8) |
83.8 |
- |
- |
- |
0.0 |
|
|
Debt due after more than one year |
(369.0) |
(31.6) |
- |
(3.7) |
16.8 |
(387.5) |
|
|
Net debt |
(423.6) |
85.2 |
4.1 |
(3.7) |
10.8 |
(327.2) |
|
The above table shows net debt exclusive of unamortised costs held on the balance sheet which amounted to £7.7m at 30 September 2024 (2023: £5.8m).
Reconciliation of movement in net debt
|
|
|
|
|
|
|
Group 2024 £m |
Group 2023 £m |
|
|
Net debt at start of year |
(327.2) |
(423.6) |
|
|
(Decrease)/increase in cash and cash equivalents |
(18.9) |
37.1 |
|
|
Net movement in borrowings |
93.0 |
52.2 |
|
|
Amortisation of loan issue costs |
(3.8) |
(3.7) |
|
|
Exchange movements |
0.4 |
10.8 |
|
|
Net debt at end of year |
(256.5) |
(327.2) |
Leverage is defined as net debt (excluding capitalised bank arrangement fees and lease liabilities, and including any non-cash ancillaries), as a proportion of Bank EBITDA and including the 12 month trailing impact of acquired businesses (in line with the Group's bank covenants definition).
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