Full Year Results

RNS Number : 9561Z

Morgan Advanced Materials PLC

13 February 2014

 



       FULL-YEAR RESULTS FOR THE PERIOD ENDED 31^st DECEMBER 2013

Results summary

£ million unless otherwise stated			2013	2012 Restated^		Change %
Business Performance Revenue			957.8	1,007.5		-4.9%
Group EBITA*			119.0	120.9		-1.6%
Group EBITA margin			12.4%	12.0%
Group underlying operating profit*			108.5	107.7		+0.7%
Underlying PBT*			85.2	85.0		+0.2%
Underlying EPS* (pence)			21.5p	21.7p		-0.9%
Return on Operating Capital Employed*			27.5%	26.3%
Full-Year dividend (pence)			10.5p	10.0p		+5.0%
Net cash inflow from operating activities			127.0	126.8		+0.2%
Statutory Reporting Operating profit			89.6	99.4		-9.9%
Profit before tax			64.0	76.7		-16.6%
Basic EPS from continuing operations (pence)			14.8p	18.7p		-20.9%

*     Definitions of the financial measures can be found in the glossary

^ 2012 results have been restated to reflect the impact of the adoption of IAS 19 (revised) Employee Benefits. Further details are given in the financial review below.

Financial highlights

·    As expected, revenue at constant currency in the second half of 2013 was similar to the first half. On a full-year basis, revenue was down 4.9% on both a reported and constant currency basis compared with 2012

·    Group EBITA margin for the second half of 2013 increased to 12.9%, a 90 basis points improvement compared with the 12.0% achieved in the first half; for the full-year the margin was 12.4% (2012: 12.0%)

·    Across the regions, North America, Europe and Asia/Rest of World, trading conditions in the second half of 2013 have remained similar to those experienced in the first half of the year, with revenue stable at constant currency. EBITA margins improved across all three regions during the second half of the year

·    Good progress on the portfolio reshaping announced in the November 2013 IMS, completing transactions in respect of businesses that accounted for c.£20 million of revenue in 2013, and which resulted in £12.9 million of write-offs, which are shown in the income statement as 'specific adjusting items' in a separate column

·    Operating cash flow was good at £127.0 million (2012: £126.8 million) and net debt was reduced to £186.5 million (2012: £192.8 million), resulting in a year end net debt to EBITDA ratio of 1.3 times (2012: 1.3 times)

·    Proposed final dividend increased to 6.7 pence per share (2012: Final 6.4 pence per share), giving a full-year dividend of 10.5 pence (2012: 10.0 pence), a 5.0% increase. 

·    Trading results from our overseas operations are converted at the average exchange rates for the year.  In the second half of 2013, sterling strengthened against many of the Group's key currencies (including the US dollar, Euro and Yuan).  If the year end closing exchange rates were applied to these reported results, then the reported 2013 revenue and EBITA would have been £44.2 million and £6.8 million lower respectively.

        Operational highlights and other developments

·     The key driver of the One Morgan organisational structure announced last year is to accelerate profitable growth by investing in core advanced materials technologies where we have differentiation, global market leadership positions and sustainable competitive advantage. Some key highlights of this in the past year include:

·       Increasing once more in 2013 our R&D spend both in absolute terms and as a percentage of revenue, meaning the Group's R&D spend is circa two and a half times greater than in 2006

·       The announcement today of a new Global Materials Centre of Excellence for Structural Ceramics in Stourport, UK. This will seek to emulate for our structural ceramics applications the world-leading breakthroughs already made in our Superwool^® fibre range from the now well established Global Centre of Excellence in Bromborough, UK

·       A 23% year-on-year increase in capital expenditure in 2013 to c.1.25 times depreciation, as we invest for profitable growth in new greenfield facilities such as Dalian, China and in converting our high-temperature fibre lines to be Superwool enabled. In 2014, we will be making further investments in growth capex including a new greenfield Superwool^® plant in the Middle East. This will enable us to leverage the strong local demand in petrochemical and aluminium markets and, at the same time, accessing low cost energy, which will make it one of our lowest cost plants in the world.  Total gross capital expenditure in 2014 is expected to be c.£40 million.

·       A significant increase in graduate recruitment to 26, providing a pipeline of engineers and commercial leaders of the future. Our target for 2014 is to increase our intake to over 30 graduates 

·    The One Morgan model has also delivered benefits to the cost base through the simpler, leaner structure. These combined with other operational initiatives undertaken in the latter part of 2012 have delivered the stated cost base improvements of £10 million in 2013 with a further £3-4 million to come through in 2014 as the full-year benefits of actions taken during the course of 2013 are realised

·     The Group has made significant progress reshaping its portfolio

·       Since the November 2013 IMS announcement, we have made good progress in  exiting c.£20 million of revenue from businesses with low/breakeven margins and limited differentiation. Other low margin businesses accounting for an additional £30 million of annual revenue are being targeted for divestment in 2014

·       We have also substantially enhanced the returns of businesses that are currently below our target of mid teen operating margins. In particular the margin of the largest of these business areas, electrical carbon, has been improved significantly in 2013 from mid single digits into double digits with further progress expected in 2014

·       Our mid-teen margin businesses have also shown progress in 2013. Of particular note is the improvement in high-temperature insulating fibre margins which meant that in the second half of 2013 Thermal Ceramics delivered, for the first time, margins in excess of 15%.

Commenting on the results, strategy and outlook for Morgan Advanced Materials, Chief Executive Officer, Mark Robertshaw said:

"Demand in our end-markets remained subdued in 2013. Against this industry backdrop our focus has been on driving portfolio reshaping initiatives and operational improvements. At the same time we have continued our ongoing investment in world-leading technology to enhance our sustainable competitive advantage.

Outlook

Our expectation for the first half of 2014 is that end-market conditions overall remain similar to those of the past several months with subdued global industrial growth. The order book going into 2014 was stable with a book to bill ratio of just over one times. The Group's focus on active portfolio reshaping initiatives, ongoing operational improvements and innovation underpin the Board's confidence that we will continue to make further progress in 2014."

For further enquiries:

Mark Robertshaw	Morgan Advanced Materials	01753 837000
Kevin Dangerfield	Morgan Advanced Materials	01753 837000
Mike Smith/Nina Coad	Brunswick	0207 404 5959

Operating Review

The results for 2012 set out below have been restated to reflect the impact of IAS 19 (revised) Employee Benefits.

Business Performance	Revenue		EBITA		EBITA Margin
	2013	2012	2013	2012	2013	2012
	£m	£m	£m	£m	%	%
North America	359.9	376.3	55.5	55.7	15.4%	14.8%
Europe	357.3	361.7	42.0	37.5	11.8%	10.4%
Asia/Rest of World	240.6	269.5	26.4	32.8	11.0%	12.2%
	957.8	1,007.5	123.9	126.0
Unallocated central costs*			(4.9)	(5.1)
Group EBITA*			119.0	120.9	12.4%	12.0%
Restructuring costs*			(10.5)	(13.2)
Underlying operating profit*			108.5	107.7	11.3%	10.7%

     Sales by market for Full-Year 2013

	Group	North America	Europe	Asia/Rest of World
Industrial	44%	30%	48%	61%
Transportation	19%	28%	13%	13%
Security and Defence	10%	8%	18%	1%
Petrochemical	8%	8%	7%	9%
Electronics	8%	14%	4%	4%
Energy	6%	5%	5%	11%
Healthcare	5%	7%	5%	1%

North America

Revenue for the North American region for the year was £359.9 million, representing a decrease of 4.4% compared with the £376.3 million in 2012.  At constant currency the year-on-year decrease was 5.6%. Revenue in the second half of 2013 was 1.5% lower than that in the first half at constant currency.

EBITA for the region was £55.5 million (2012: £55.7 million) with margin improving to 15.4% (2012: 14.8%).  The EBITA margin in the second half of 2013 also improved to 16.0%, compared with 14.8% in the first half of 2013.

Trading conditions in the second half continued to be mixed as they were in the first half of the year.

The Thermal Ceramics business continued to perform well in its niche automotive applications, in particular supplying for catalytic converters, and in general industrial markets. As in other parts of the world, the North American Thermal Ceramics business continued to be impacted by a lack of large project orders in the petrochemical market despite high quote activity.  The business has continued to expand the manufacturing capacity for Superwool® low bio-persistence fibre and has successfully increased market penetration.  A focus on attractive niche markets, the gross margin benefits of Superwool compared to refractory ceramic fibre (RCF) and operational improvements all contributed to higher operating margins.

The Technical Ceramics business in 2013 was impacted by weaker hard disk drive and semi-conductor business, though there have been some signs of general market recovery in the latter part of the fourth quarter of 2013 and there is a solid order book for the start of 2014. Sales in the second half of the year to the aerospace and industrial gas turbine market were impacted by customer inventory adjustments, specifically cores used in the manufacture of turbine blades. The Technical Ceramics business is starting to see some benefits from the strong oil and gas market and particularly to the increase in hydraulic fracturing activity, "fracking".

The electrical carbon business, has delivered broadly flat revenue through 2013 relative to the second half of 2012. Progress has been made in sales to the wind energy market where market share has been won in the after-market based on our differentiated product offering and service levels.  Demand for high-temperature insulation products into the renewables sector and for US body armour remained at the low levels experienced in the first half of the year.

A sizeable uplift in the performance of the electrical carbon business came from the operational streamlining actions taken as a result of One Morgan.

The region overall has progressively seen the benefits of the One Morgan organisational model and is already a mid-teen margin business despite difficult trading conditions during the year. The focus as one unified region in 2014 is on delivering further performance improvement and creating new opportunities for profitable growth.

Europe

Revenue for the European region for the year was £357.3 million, representing a decrease of 1.2% compared with the £361.7 million in 2012.  At constant currency the year-on-year decrease was 3.7%. Revenue in the second half of 2013 was 1.5% lower than that in the first half at constant currency.

EBITA for the region increased to £42.0 million (2012: £37.5 million), improving the full-year margin of the region to 11.8% (2012: 10.4%).  This margin improvement came through increasingly during the year with the EBITA margin in the second half of 2013 being 12.3% compared with 11.2% in the first half of 2013.

The trading conditions in Europe remained broadly stable in the second half of the year when compared to the first half, both in terms of revenue and order book. In the Thermal Ceramics business, comprising principally high-temperature insulating fibre and firebrick, revenue from larger engineering project business continued to be weak as customers delayed major investment decisions.  Since the end of the year, Morgan merged its UK-based thermal fired shapes business with Magma Ceramics & Catalysts, a UK-based fired shapes specialist business, in return for a 35% minority stake in the enlarged Magma business.  In the Technical Ceramics business, sales of cores to both the aerospace and the industrial gas turbine market weakened in the second half of 2013, but this was offset by growth in sales to the medical market.

The electrical carbon business remained ahead of 2012 revenue due to market share gains and some growth in sales of rotary products to the wind energy market.  Similarly, the seals and bearings business delivered growth in sales to the petrochemical and water markets. Revenue in Composites and Defence Systems (C&DS) improved in the second half compared to the first half of the year, with improving profitability based on a combination of product mix, volume and operational cost reductions.  By the end of second half of 2013 C&DS exited its low margin spares and logistics contract with the UK MoD in respect of the Mastiff fleet of vehicles which generated c.£12 million of revenue in 2013. 

EBITA margin in the second half of the year continued to improve despite a broadly flat revenue profile half-on-half. Delivery of operational improvements across the region, including site closures and headcount reductions, particularly in the electrical carbon and C&DS businesses were the major contributors to the improving margin.

Asia & Rest of the World

Revenue for the Asia & Rest of the World region for the year was £240.6 million, representing a decrease of 10.7% compared with the £269.5 million in 2012.  At constant currency the decrease was 5.7%. Revenue in the second half of 2013 was 4.4% higher than that in the first half at constant currency.

EBITA for the region was £26.4 million (2012: £32.8 million), a margin of 11.0% (2012: 12.2%).  The EBITA margin in the second half of 2013 was 11.2%, compared with 10.8% in the first half of 2013.

Trading across the region has remained subdued through 2013. Both China and India have continued to see challenging market conditions in 2013 with industrial, steel and petrochemical markets which make up the majority of our business in the region not yet showing much sign of upturn. Large engineering and project orders have remained at low levels throughout the period. Growth has been achieved in niche markets such as automotive, fire protection and rail. Most encouragingly, new sales have been made in to the Asian medical market, specifically cochlear implants and feed through devices. Revenue from the Middle East increased in the second half of 2013 in the petrochemical industry with refurbishment/replacement work coming through. The Molten Metal Systems business with close to 50% of its business in the region was impacted by weak automotive and aluminium demand, particularly in India.

The region continued to improve its margins into the second half of the year despite market demand showing little pickup as yet. The organisational changes in the region and the cost reductions following site closures in Australia and a cessation of higher cost fibre manufacturing lines in Japan and South Africa with material sourced from lower cost plants elsewhere in the region have all contributed to this improving performance.

Financial Review

Reference is made to 'Underlying operating profit' and 'Underlying EPS' below, both of which are defined in the glossary. These measures of earnings are shown because the Directors consider that they give the best indication of underlying performance.

Business Performance Review

In the consolidated income statement the Group separately presents "Specific adjusting items" totalling £12.9 million and the associated tax credit of £1.8 million separately. In the Business Performance Review below results are shown before these items.

Group revenue in 2013 was £957.8 million, a decrease of 4.9% on both a reported and constant currency basis compared with 2012

Group EBITA before restructuring charges was £119.0 million (2012:  £120.9 million) representing a margin of 12.4% (2012: 12.0%). EBITA margin in the second half of this year was 12.9%, a 90 basis points improvement compared to the 12.0% in the first half of 2013.

Group underlying operating profit (EBITA after restructuring costs) 2013 was £108.5 million (2012: £107.7 million).  Underlying operating profit margin was 11.3%, compared to 10.7% for 2012.

The restructuring costs of £10.5 million (2012: £13.2 million) relate mainly to the actions that the Group has undertaken as a consequence of moving to the One Morgan model and the re-organisation into geographical regions.

The Group amortisation charge for the year was £8.3 million (2012: £8.3 million).

The net finance charge was £23.3 million (2012: £22.7 million), comprising the net bank interest and similar charges of £17.0 million (2012: £16.9 million), which is flat year-on-year, and the finance charge under IAS 19 (revised), being the interest charge on pension scheme net liabilities which was £6.3 million (2012: £5.6 million).

The tax charge for the period was £21.1 million (2012: £21.6 million). The effective tax rate, excluding specific adjusting items, is 27.4% (2012: 28.2%).

Underlying EPS was 21.5 pence (2012: 21.7 pence).

The Return on Operating Capital Employed at 31 December 2013, defined as Group underlying profit for the last 12 months divided by the sum of working capital and the net book value of tangible assets, was 27.5%, compared with 26.3% at 31 December 2012.

Specific adjusting items

In the consolidated income statement the Group presents specific adjusting items totalling £12.9 million and the associated tax credit of £1.8 million separately. In the judgement of the Directors due to the nature and value of these items they should be disclosed separately from the underlying results of the Group to allow the reader to obtain a proper understanding of the financial information and the best indication of underlying performance of the Group. No specific adjusting items were incurred in 2012.

					2013		2012
					£m	£m
Specific adjusting items:
Business exit costs					7.3	-
Impairment of intangible assets					3.3	-
Loss on disposal of business					2.3	-
					12.9
Income tax credit from specific adjusting items					(1.8)	-
					11.1	-

Business exit costs

This relates to Composites and Defence Systems and is a result of the exit of the UK MoD vehicles logistics and spares contract and the completion of UK MoD Urgent Operational Requirements (UOR) for new vehicle builds. Specifically the charge comprises a £5.7 million provision against inventory and a £1.6 million provision for building exit costs and impairment of other assets. An income tax credit of £1.6 million has been recognised in respect of these items.

Impairment of intangible assets

The impairment of intangible assets consists of a £3.3 million impairment of goodwill and intangible assets originally recognised on acquisition of Morgan AM&T Hairong Ltd (formerly Changsha Hairong New Materials Co., Ltd) ('Hairong'), the Group's lithium ion business, based on the current view of the future financial performance of Hairong. An income tax credit of £0.2 million has been recognised in respect of this item.

Loss on disposal of business

On 28 December 2013 the Group disposed of 23.85% of the share capital of Assam Carbon Products Ltd ('Assam') for nil consideration. The Group retains a 28.8% shareholding. As a result of the transaction the Group no longer has control of Assam and has therefore deconsolidated the assets and liabilities of Assam in these consolidated financial statements. The loss recognised on the disposal of this shareholding was £2.3 million. Based on the Group's remaining 28.8% shareholding the Group accounts for the shareholding as an associate. The fair value of the Group's remaining investment has been measured at nil.

Adoption of IAS 19 (revised) Employee Benefits

For the year ended 31 December 2013 the Group is required to adopt IAS 19 (revised) Employee Benefits and the results for the year ended 31 December 2012 have been restated to reflect this.

The impact of the changes on the full-year ended 31 December 2012 is a £4.2 million reduction in profit after taxation, consisting of:

a)      a £1.1 million reduction in Group EBITA, Group underlying operating profit and operating profit as a result of the requirement to reclassify pension scheme administration costs from net finance charge to operating costs;

b)      a £4.7 million reduction in Underlying PBT and profit before tax due to the new requirement for the expected return on assets to be calculated by applying the corporate bond yield discount rate to the balance sheet pension-related assets;

c)      a £0.5 million reduction in taxation charge as a result of the above changes.

The IAS 19 (revised) charges are summarised in the table below. 

	FY 2013 £m	FY 2012 Restated £m	FY 2012 Previously reported £m
Operating costs:
- Service Cost	(4.5)	(4.4)	(4.4)
- Curtailment charge	-	(0.2)	(0.2)
- Administration costs	(1.4)	(1.1)	-
Total operating costs	(5.9)	(5.7)	(4.6)
Net finance charge:
- Net interest charge	(6.3)	(5.6)	(0.9)
- Administration costs	-	-	(1.1)
Net finance charge	(6.3)	(5.6)	(2.0)
Total IAS 19 charge before taxation	(12.2)	(11.3)	(6.6)

The Group pension deficit has decreased by £22.2 million since last year end to £144.6 million on an IAS 19 (revised) basis.  The main movement was in the US defined benefit pension schemes, where the deficit decreased by £23.4 million to £39.3 million (2012: £62.7 million), due primarily to a higher discount rate (2013: 5.0%, 2012 4.2%) and the weakening of the US$ versus £ sterling. The UK deficit increased by £3.7 million to £75.0 million (2012: £71.3 million).

Cash Flow

						2013		2012
						£m	£m
Net cash inflow from operating activities						127.0	126.8
Net capital expenditure						(33.7)	(26.7)
Restructuring costs						(14.0)	(5.9)
Net interest paid						(17.0)	(18.5)
Tax paid						(24.9)	(26.8)
Free cash flow before acquisitions and dividends						37.4	48.9
Cash flows in respect of disposals/(acquisitions)						1.7	(6.6)
Dividends paid						(24.7)	(16.1)
Purchase of own shares for share incentive schemes						(6.6)	(9.4)
Exchange movement and other items						(1.5)	5.8
Movement in net debt in period						6.3	22.6
Opening net debt						(192.8)	(215.4)
Closing net debt						(186.5)	(192.8)

The net cash inflow from operating activities was £127.0 million (2012: £126.8 million). Free cash flow before acquisitions and dividends was £37.4 million (2012: £48.9 million). Dividend payments increased to £24.7 million (2012: £16.1 million) as a consequence of the decision to bring forward the payment of dividends.  As a result, in 2013 three dividend payments were made; the 2012 interim, the 2012 final and the 2013 interim dividend.

Net debt at the year end was £186.5 million (2012: £192.8 million) representing a net debt to EBITDA ratio of 1.3 times (2012 year end: 1.3 times). At 31 December 2013 all of the Group's bank facility of £150 million was undrawn.

Foreign exchange - translation effect - illustration

During the second half of 2013 sterling strengthened substantially against most currencies that Morgan trades in, and by year end the closing rates of exchange of a number of currencies were materially different from the average rates used in the income statement. For illustrative purposes, the table below provides details of the impact on 2013 revenue and EBITA if the actual reported results, calculated using 2013 average exchange rates, were restated at 2013 closing exchange rates.

Currency
	Revenue by currency £m	% of Group revenue	FX rate change		Revenue impact £m		EBITA impact £m
USD	355.0	37.1%	-5.5%		(19.7)		(3.1)
EUR	195.2	20.4%	-2.0%		(3.9)		(0.6)
GBP	143.8	15.0%			-		-
CNY	87.6	9.1%	-4.1%		(3.6)		(0.5)
Other	176.2	18.4%	-9.6%*		(17.0)		(2.6)
	957.8				(44.2)		(6.8)

* Other FX rate change is the weighted average of a number of other currencies, of which the largest movements are in Indian Rupees, Australian Dollars and Brazilian Real.

In addition to the large decrease in revenue and EBITA caused by currency translation, the EBITA margin would also be reduced by 10-15 basis points if 2013 closing rates were applied.

Final Dividend

The Board has recommended a final dividend of 6.7 pence per Ordinary share (2012: 6.4 pence). This is an increase of 4.7% compared to the final dividend declared in 2012. The dividend will be paid on 30 May 2014 to Ordinary shareholders on the register of members at the close of business on 16 May 2014.

A scrip alternative to the cash dividend will not be offered as part of the final dividend.

Glossary of terms

Group earnings before interest, tax, depreciation and amortisation ("EBITDA")	Operating profit before specific adjusting items, restructuring costs, depreciation and amortisation of intangible assets
Group earnings before interest, tax and amortisation ("EBITA")	Operating profit before specific adjusting items, restructuring costs and amortisation of intangible assets
Group underlying operating profit	Operating profit of £89.6 million (2012: £99.4 million) before specific adjusting items of £10.6 million (2012: nil) and amortisation of intangibles of £8.3 million (2012: £8.3 million)
Net debt	Interest-bearing loans and borrowings, bank overdrafts less cash and cash equivalents
Restructuring costs	Include the costs of restructuring activity and gain on disposal of property
Restated	The results for the year ended 31 December 2012 have been restated to reflect the required adoption of IAS 19 (revised) Employee Benefits. See Financial Review for further details.
Return on operating capital employed ("ROCE")	Group underlying profit for the last 12 months divided by the sum of working capital and the net book value of tangible assets
Unallocated central costs	Includes plc costs (e.g. Report & Accounts, AGM, Non-Executives) and Group management costs (eg. Corporate head office rent, utilities, staff etc.)
Underlying earnings per share ("EPS")	Basic earnings per share of 14.8 pence (2012: 18.7 pence) adjusted to exclude specific adjusting items of 3.8 pence (2012: nil) and amortisation of 2.9 pence (2012: 3.0 pence)
Underlying profit before tax ("PBT")	Operating profit of £89.6 million (2012: £99.4 million) before specific adjusting items of £10.6 million (2012: nil) and amortisation of intangibles of £8.3 million (2012: £8.3 million), less net financing costs of  £23.3 million (2012: £22.7 million)
Working capital (as used in the ROCE calculation)	Working capital as used in the calculation of ROCE is the sum of inventories, £118.9million (2012: £139.9 million), trade and other receivables, £188.2 million (2012: £185.4 million), net derivative financial assets/(liabilities), £0.8 million (2012: £1.1 million), trade and other payables, £(175.9) million (2012: £(184.0) million) less  tax accruals £(22.9) million (2012: £(23.2) million), plus the net of deferred consideration, third party dividends payable and other sundry items, £(1.9) million  (2012: £(1.2) million).
a)

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                                  Morgan Advanced Materials plc  Registered in England & Wales at Quadrant, 55-57 High Street, Windsor, Berkshire SL4 1LP UK  Company No. 286773

CONSOLIDATED INCOME STATEMENT for the year ended 31 December 2013
			Results before specific adjusting items	Specific adjusting items*	Total
			2013	2013	2013		2012
							Restated ^
		Note	£m	£m	£m		£m
Revenue		2	957.8	-	957.8		1,007.5
Operating costs before restructuring costs and amortisation of intangible assets			(838.8)	-	(838.8)		(886.6)
Profit from operations before restructuring costs and amortisation of intangible assets			119.0	-	119.0		120.9
Restructuring costs:
Restructuring costs			(11.3)	-	(11.3)		(13.3)
Gain on disposal of properties			0.8	-	0.8		0.1
Business exit costs		5	-	(7.3)	(7.3)		-
Profit from operations before amortisation of intangible assets		2	108.5	(7.3)	101.2		107.7
Amortisation and impairment of intangible assets			(8.3)	(3.3)	(11.6)		(8.3)
Operating profit		2	100.2	(10.6)	89.6		99.4
Finance income			1.3	-	1.3		1.6
Finance expense			(24.6)	-	(24.6)		(24.3)
Net financing costs		3	(23.3)	-	(23.3)		(22.7)
Loss on disposal of business		5	-	(2.3)	(2.3)		-
Profit before taxation			76.9	(12.9)	64.0		76.7
Income tax expense		4	(21.1)	1.8	(19.3)		(21.6)
Profit after taxation before discontinued operations			55.8	(11.1)	44.7		55.1
Discontinued operations		6	-	-	-		21.0
Profit for the period			55.8	(11.1)	44.7		76.1
Profit for period attributable to:
Owners of the parent			52.4	(10.6)	41.8		72.8
Non-controlling interests			3.4	(0.5)	2.9		3.3
			55.8	(11.1)	44.7		76.1
Basic earnings per share		7
Continuing operations					14.8p		18.7p
Discontinued operations					0.0p		7.6p
					14.8p		26.3p
Diluted earnings per share
Continuing operations					14.7p		18.4p
Discontinued operations					0.0p		7.4p
					14.7p		25.8p
Dividends
Interim dividend	- pence				3.80p		3.60p
	- £m				10.8		10.1
Proposed final dividend	- pence				6.70p		6.40p
	- £m				19.1		17.9
The proposed final dividend is based upon the number of shares outstanding at the balance sheet date.
* Details of 'Specific adjusting items' are given in note 5
^ Details of the restatement are given in note 1

CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME
for the year ended 31 December 2013
			Fair		Total parent	Non-	Total
	Translation	Hedging	value	Retained	comprehensive	controlling	comprehensive
	reserve	reserve	reserve	earnings	income	interests	income
				Restated ^	Restated ^		Restated ^
2012	£m	£m	£m	£m	£m	£m	£m
Profit for the period	-	-	-	72.8	72.8	3.3	76.1
Items that will not be reclassified subsequently to profit or loss:
Remeasurement loss on defined benefit plans	-	-	-	(43.2)	(43.2)	-	(43.2)
Tax effect of components of other comprehensive income not reclassified	-	-	-	6.2	6.2	-	6.2
	-	-	-	(37.0)	(37.0)	-	(37.0)
Items that may be reclassified subsequently to profit or loss:
Foreign exchange translation differences	(11.8)	-	-	-	(11.8)	(3.5)	(15.3)
Net gain on hedge of net investment in foreign subsidiaries	2.6	-	-	-	2.6	-	2.6
Cash flow hedges:
Effective portion of changes in fair value	-	0.9	-	-	0.9	-	0.9
Transferred to profit or loss	-	(0.6)	-	-	(0.6)	-	(0.6)
Change in fair value of equity securities available-for-sale	-	-	0.1	-	0.1	-	0.1
	(9.2)	0.3	0.1	-	(8.8)	(3.5)	(12.3)
Total comprehensive income, net of tax	(9.2)	0.3	0.1	35.8	27.0	(0.2)	26.8
2013
Profit for the period	-	-	-	41.8	41.8	2.9	44.7
Items that will not be reclassified subsequently to profit or loss:
Remeasurement gain on defined benefit plans	-	-	-	12.2	12.2	-	12.2
Tax effect of components of other comprehensive income not reclassified	-	-	-	(5.5)	(5.5)	-	(5.5)
	-	-	-	6.7	6.7	-	6.7
Items that may be reclassified subsequently to profit or loss:
Foreign exchange translation differences	(14.6)	-	-	-	(14.6)	(2.8)	(17.4)
Net gain on hedge of net investment in foreign subsidiaries	0.4	-	-	-	0.4	-	0.4
Cash flow hedges:
Effective portion of changes in fair value	-	(0.5)	-	-	(0.5)	-	(0.5)
Transferred to profit or loss	-	0.4	-	-	0.4	-	0.4
Change in fair value of equity securities available-for-sale	-	-	0.3	-	0.3	-	0.3
	(14.2)	(0.1)	0.3	-	(14.0)	(2.8)	(16.8)
Total comprehensive income, net of tax	(14.2)	(0.1)	0.3	48.5	34.5	0.1	34.6
^ Details of the restatement are given in note 1

CONSOLIDATED BALANCE SHEET
as at 31 December 2013
		2013	2012
			Restated ^
	Note	£m	£m
Assets
Property, plant and equipment		241.4	245.5
Intangible assets		249.5	265.1
Investments		3.7	5.4
Other receivables		4.3	4.6
Deferred tax assets		28.2	40.6
Total non-current assets		527.1	561.2
Inventories		118.9	139.9
Derivative financial assets		1.7	1.8
Trade and other receivables		188.2	185.4
Cash and cash equivalents	8	76.0	80.0
Total current assets		384.8	407.1
Total assets		911.9	968.3
Liabilities
Interest-bearing loans and borrowings		201.5	265.0
Employee benefits		144.6	166.8
Provisions		4.8	6.9
Non-trade payables		1.4	4.8
Deferred tax liabilities		33.5	40.5
Total non-current liabilities		385.8	484.0
Interest-bearing loans and borrowings and bank overdrafts		61.0	7.8
Trade and other payables		175.9	184.0
Current tax payable		1.3	6.1
Provisions		12.9	14.1
Derivative financial liabilities		0.9	0.7
Total current liabilities		252.0	212.7
Total liabilities		637.8	696.7
Total net assets		274.1	271.6
Equity
Share capital		71.8	70.4
Share premium		111.7	99.0
Reserves		37.9	51.6
Retained earnings		16.7	12.8
Total equity attributable to equity owners of parent Company		238.1	233.8
Non-controlling interests		36.0	37.8
Total equity		274.1	271.6
^ Details of the restatement are given in note 1
The financial statements were approved by the Board of Directors on 13 February 2014 and were signed on its behalf by:
Mark Robertshaw, Chief Executive Officer
Kevin Dangerfield, Chief Financial Officer

CONSOLIDATED STATEMENT OF CHANGES IN EQUITY
for the year ended 31 December 2013
	Share capital	Share premium	Translation reserve	Hedging reserve	Fair value reserve	Special reserve	Capital redemption reserve	Other reserves	Retained earnings	Total parent equity	Non-controlling interests	Total equity
									Restated ^	Restated ^		Restated ^
	£m	£m	£m	£m	£m	£m	£m	£m	£m	£m	£m	£m
Balance at 2 January 2012 as previously reported	68.7	90.6	8.6	0.4	(1.4)	6.0	35.7	11.1	9.7	229.4	40.8	270.2
Effect of restatement	-	-	-	-	-	-	-	-	(0.2)	(0.2)	-	(0.2)
Balance at 2 January 2012 as restated	68.7	90.6	8.6	0.4	(1.4)	6.0	35.7	11.1	9.5	229.2	40.8	270.0
Profit for the year	-	-	-	-	-	-	-	-	72.8	72.8	3.3	76.1
Other comprehensive income	-	-	(9.2)	0.3	0.1	-	-	-	(37.0)	(45.8)	(3.5)	(49.3)
Transactions with owners:
Dividends	0.9	8.4	-	-	-	-	-	-	(25.4)	(16.1)	(2.8)	(18.9)
Equity-settled share-based payment transactions	-	-	-	-	-	-	-	-	3.1	3.1	-	3.1
Own shares acquired for share incentive schemes	0.8	-	-	-	-	-	-	-	(10.2)	(9.4)	-	(9.4)
Balance at 31 December 2012	70.4	99.0	(0.6)	0.7	(1.3)	6.0	35.7	11.1	12.8	233.8	37.8	271.6
Balance at 1 January 2013	70.4	99.0	(0.6)	0.7	(1.3)	6.0	35.7	11.1	12.8	233.8	37.8	271.6
Profit for the year	-	-	-	-	-	-	-	-	41.8	41.8	2.9	44.7
Other comprehensive income	-	-	(14.2)	(0.1)	0.3	-	-	-	6.7	(7.3)	(2.8)	(10.1)
Transactions with owners:
Dividends	1.4	12.7	-	-	-	-	-	-	(38.8)	(24.7)	(1.6)	(26.3)
Equity-settled share-based payment transactions	-	-	-	-	-	-	-	-	0.8	0.8	-	0.8
Own shares acquired for share incentive schemes	-	-	-	-	-	-	-	-	(6.6)	(6.6)	-	(6.6)
Adjustment arising from change in non-controlling interest	-	-	-	-	-	-	-	0.3	-	0.3	(0.3)	-
Balance at 31 December 2013	71.8	111.7	(14.8)	0.6	(1.0)	6.0	35.7	11.4	16.7	238.1	36.0	274.1
^ Details of the restatement are given in note 1

CONSOLIDATED STATEMENT OF CASH FLOWS
for the year ended 31 December 2013
		2013	2012
			Restated ^
	Note	£m	£m
Operating activities
Profit for the period before discontinued operations		44.7	55.1
Adjustments for:
Depreciation		29.3	30.0
Amortisation		8.3	8.3
Net financing costs	3	23.3	22.7
Profit on sale of property, plant and equipment		(0.8)	(0.2)
Income tax expense	4	19.3	21.6
Non-cash operating costs relating to restructuring		0.5	5.0
Specific adjusting items	5	10.6	-
Loss on disposal of business	5	2.3	-
Equity-settled share-based payment expenses		0.7	1.9
Cash generated from operations before changes in working capital and provisions		138.2	144.4
(Increase)/decrease in trade and other receivables		(10.8)	0.8
Decrease in inventories		9.5	18.5
(Decrease) in trade and other payables		(3.1)	(31.9)
(Decrease) in provisions and employee benefits		(20.8)	(10.8)
Cash generated from operations		113.0	121.0
Interest paid		(18.3)	(20.1)
Income tax paid		(24.9)	(26.8)
Net cash from operating activities		69.8	74.1
Investing activities
Purchase of property, plant and equipment		(36.3)	(29.4)
Proceeds from sale of property, plant and equipment		2.6	2.7
Sale of investments		0.1	0.1
Interest received		1.3	1.6
Disposal/(acquisition) of subsidiaries, net of cash acquired		0.7	(6.6)
Forward contracts used in net investment hedging		2.1	0.7
Deferred consideration received on disposal of subsidiary		1.0	-
Net cash from investing activities		(28.5)	(30.9)
Financing activities
Purchase of own shares for share incentive schemes		(6.6)	(9.4)
Repayment of borrowings		(8.9)	(16.2)
Payment of finance lease liabilities		(0.1)	(0.2)
Dividends paid		(24.7)	(16.1)
Net cash from financing activities		(40.3)	(41.9)
Net increase in cash and cash equivalents		1.0	1.3
Cash and cash equivalents at start of period		80.0	83.4
Effect of exchange rate fluctuations on cash held		(5.0)	(4.7)
Cash and cash equivalents at period end		76.0	80.0
^ Details of the restatement are given in note 1

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 1. Basis of Preparation

The preliminary announcement for the year ended 31 December 2013 has been prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union and as issued by the International Accounting Standards Board. There has been no significant impact arising from new accounting policies adopted in the year. Going Concern The Group meets its day-to-day working capital requirements through local banking arrangements that are supported by the flexibility provided by the Group bank facility of £150 million unsecured five year multi-currency revolving credit facility.  The bank facility headroom at the year end was £150 million. The Group's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Group is able to operate within the level of its committed facilities. The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the consolidated financial statements for the year ended 31 December 2013. The financial information set out above does not constitute the Company's statutory accounts for the years ended 31 December 2013 or 31 December 2012. Statutory accounts for the year ended 31 December 2012 have been delivered to the registrar of companies, and those for the year ended 31 December 2013 will be delivered in due course. The auditors have reported on those accounts; their report was (i) unqualified, (ii) did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying their report and (iii) did not contain a statement under Section 498(2) or (3) of the Companies Act 2006 in respect of the accounts for 2013 and 2012.

Adoption of new and revised Standards

IAS 19 (revised) Employee Benefits

During the period, the Group has applied IAS 19 (revised) Employee Benefits. This has led to a restatement of the comparatives for 2012. The impact on the Group of the revised standard is as follows:

(a) interest cost and expected return on assets were replaced by a net interest cost which is calculated by applying the discount rate to the net defined benefit obligation.

(b) pension scheme administration costs have been reclassified from net finance charge to operating costs. Such costs include the PPF levy and actuary, audit, legal and trustee charges which, under the previous IAS 19, were allowed to be included within the net finance charge.

(c) past service costs are recognised immediately instead of being accrued over the vesting period.

The impact of the changes was a £5.1 million reduction in profit for the period (2012: £4.2 million), as follows:

(i) A £1.4 million increase in operating costs before restructuring costs and amortisation of intangible assets (2012: £1.1 million);

(ii) A £4.3 million increase in net financing costs (2012: £3.6 million);

(iii) A £0.6 million reduction in income tax expense (2012: £0.5 million).

The changes resulted in a £5.1 million increase in other comprehensive income excluding profit for the period (2012: £4.2 million).

The above changes reduced basic/diluted earnings per share for 2012 by 1.5 pence, with basic earnings per share reducing from 20.2 pence to 18.7 pence and diluted basic earnings per share reducing from 19.9 pence to 18.4 pence.

The impact of the changes on the balance sheet was a £0.2 million increase in the net employee benefits obligation.

The increase in operating costs resulted in a decrease in Regional EBITA for the Group's new reportable operating segments (see note 2) as follows: North America £0.6 million (2012: £0.5 million) and Europe £0.8 million (2012: £0.6 million).

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. Segment reporting
The tables below show restated comparative figures for the operating segments and for the Group for the year ended 31 December 2012. The restatements reflect the impact of changes the Group made to its internal organisation changes during the year ended 31 December 2013, which caused the composition of its reportable segments to change. In addition the restatements reflect the impact from the adoption of the change in IAS 19 (revised) Employee Benefits that was adopted for the year ended 31 December 2013. Details of the impact of the adoption of IAS 19 (revised) Employee Benefits are given in note 1.
Following the internal organisation changes made, the Group is now organised on a geographical basis and comprises the following three reportable operating segments: North America, Europe and Asia/Rest of World.
The information presented below represents the operating segments of the Group.
		North America			Europe			Asia/Rest of World			Consolidated
		2013	2012		2013	2012		2013	2012		2013	2012
			Restated			Restated			Restated			Restated
		£m	£m		£m	£m		£m	£m		£m	£m
Revenue from external customers		359.9	376.3		357.3	361.7		240.6	269.5		957.8	1,007.5
Regional EBITA before impact of IAS 19 restatement (2012)			56.2			38.1			32.8			127.1
Impact of IAS 19 restatement (2012)			(0.5)			(0.6)			-			(1.1)
Regional EBITA		55.5	55.7		42.0	37.5		26.4	32.8		123.9	126.0
Unallocated costs											(4.9)	(5.1)
Group EBITA											119.0	120.9
Restructuring costs		(2.5)	(1.5)		(2.6)	(6.2)		(3.3)	(5.5)		(8.4)	(13.2)
Unallocated restructuring costs											(2.1)	-
Underlying operating profit											108.5	107.7
Amortisation of intangible assets		(3.2)	(2.8)		(3.6)	(4.3)		(1.5)	(1.2)		(8.3)	(8.3)
Operating profit before specific adjusting items											100.2	99.4
Specific adjusting items included in operating profit											(10.6)	-
Operating profit											89.6	99.4
Finance income before impact of IAS 19 restatement (2012)												26.3
Impact of IAS 19 restatement (2012)												(24.7)
Finance income											1.3	1.6
Finance expense before impact of IAS 19 restatement (2012)												(45.4)
Impact of IAS 19 restatement (2012)												21.1
Finance expense											(24.6)	(24.3)
Loss on disposal of business											(2.3)	-
Profit before taxation											64.0	76.7

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. Segment reporting (continued)		North America			Europe			Asia/Rest of World			Consolidated
		2013	2012		2013	2012		2013	2012		2013	2012
			Restated			Restated			Restated			Restated
		£m	£m		£m	£m		£m	£m		£m	£m
Segment assets		283.3	289.0		303.1	320.3		218.6	231.0		805.0	840.3
Unallocated assets											106.9	128.0
Total assets											911.9	968.3
Segment liabilities		89.1	117.6		166.6	167.5		46.4	51.6		302.1	336.7
Unallocated liabilities											335.7	360.0
Total liabilities											637.8	696.7
Segment capital expenditure		13.5	11.0		7.1	7.7		15.7	10.6		36.3	29.3
Unallocated capital expenditure											-	0.1
Total capital expenditure											36.3	29.4
Segment depreciation		12.0	12.3		9.8	9.7		7.4	7.9		29.2	29.9
Unallocated depreciation											0.1	0.1
Total depreciation											29.3	30.0
NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 2. Segment reporting (continued)
								Revenue from external customers		Non-current assets (excluding tax and financial instruments)
								2013	2012	2013	2012
								£m	£m	£m	£m
USA								301.4	315.5	165.8	171.0
UK (the Group's country of domicile)								108.6	107.9	159.4	165.6
China								82.6	83.6	55.1	51.9
Germany								63.5	70.3	31.6	31.1
France								39.6	41.1	19.8	20.9
Other Asia, Middle East and Africa								156.1	187.3	30.8	36.2
Other Europe								131.0	127.5	21.5	22.5
Other North America								41.3	30.8	7.0	11.6
South America								33.7	43.5	7.9	9.8
								957.8	1,007.5	498.9	520.6
Revenue from external customers is based on geographic location of the end-customer. Segment assets are based on geographical location of the assets.
Segment Revenue by Product
								2013	2012
								£m	£m
Industrial								425.4	453.5
Transportation								180.4	187.6
Electronics								71.9	87.3
Petrochemical								76.1	93.1
Security & Defence								94.4	81.4
Energy								61.7	62.0
Healthcare								47.9	42.6
								957.8	1,007.5
Intercompany sales to other segments		North America			Europe			Asia/Rest of World
		2013	2012		2013	2012		2013	2012
		£m	£m		£m	£m		£m	£m
Intercompany sales to other segments		23.4	22.2		18.0	19.6		8.0	9.1

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 3. Net finance income and expense
					2013		2012
							Restated
					£m		£m
Recognised in profit or loss
Interest income on bank deposits measured at amortised cost					1.3		1.6
Finance income					1.3		1.6
Interest expense on financial liabilities measured at amortised cost					(18.3)		(18.5)
Net interest on IAS 19 obligations					(6.3)		(5.6)
Interest expense on unwinding of discount on deferred consideration					-		(0.2)
Finance expense					(24.6)		(24.3)
Net financing costs recognised in profit or loss					(23.3)		(22.7)
Recognised directly in equity
Net change in fair value of available-for-sale financial assets					0.3		0.1
Cash flow hedges:
Effective portion of changes in fair value of cash flow hedges					(0.5)		0.9
Transferred to profit or loss					0.4		(0.6)
Effective portion of change in fair value of net investment hedge					0.4		2.6
Foreign currency translation differences for foreign operations					(14.6)		(11.8)
					(14.0)		(8.8)
4. Taxation - income tax expense
Recognised in the income statement
				2013			2012
							Restated
				£m			£m
Current tax expense
Current year				23.5			24.9
Adjustments for prior years				(3.6)			(5.0)
				19.9			19.9
Deferred tax expense
Origination and reversal of temporary differences				(0.6)			1.7
Total income tax expense in income statement				19.3			21.6
Reconciliation of effective tax rate	2013	2013		2012			2012
				Restated			Restated
	£m	%		£m			%
Profit before tax	64.0			76.7
Income tax using the domestic corporation tax rate	14.9	23.2		18.8			24.5
Non-deductible expenses	3.6	5.6		2.4			3.1
Temporary differences not equalised in deferred tax	1.0	1.6		(1.4)			(1.8)
Adjustments in respect of prior years	(2.2)	(3.4)		(3.6)			(4.7)
Recognition of previously unrecognised temporary differences	(5.0)	(7.8)		-			-
Other (including the impact of overseas tax rates)	7.0	10.9		5.4			7.0
	19.3	30.1		21.6			28.2
Income tax recognised directly in equity
Tax effect on components of other comprehensive income:
- Current tax associated with share schemes	0.5			1.3
- Deferred tax associated with defined benefit schemes                              and share schemes	(6.0)			4.9
- Other	-			-
Total income tax recognised directly in equity	(5.5)			6.2
The effective rate of tax before specific adjusting items is 27.4%.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

5. Specific adjusting items
In the consolidated income statement the Group presents specific adjusting items separately. In the judgement of the Directors, due to the nature and value of these items they should be disclosed separately from the underlying results of the Group to allow the reader to obtain a proper understanding of the financial information and the best indication of underlying performance of the Group. No specific adjusting items were incurred in 2012.
	2013	2012
	£m	£m
Specific adjusting items:
- Business exit costs	7.3	-
- Impairment of intangible assets	3.3	-
- Loss on disposal of business	2.3	-
Total specific adjusting items before income tax credit	12.9	-
- Income tax credit from specific adjusting items	(1.8)	-
	11.1	-
Business exit costs
Business exit costs relates to Composites and Defence Systems and is a result of the exit of the UK MoD vehicles logistics and spares contract and the completion of UK MoD Urgent Operational Requirements (UOR) for new vehicle builds. Specifically the charge comprises a £5.7 million provision against inventory and a £1.6 million provision for building exit costs and impairment of other assets. An income tax credit of £1.6 million has been recognised in respect of these items.
Impairment of intangible assets
The impairment of intangible assets consists of a £3.3 million impairment of goodwill and intangible assets originally recognised on acquisition of Morgan AM&T Hairong Ltd (formerly Changsha Hairong New Materials Co., Ltd) ('Hairong'), based on the current view of the future financial performance of Hairong. An income tax credit of £0.2 million has been recognised in respect of this one-off item.
Loss on disposal of business
On 28 December 2013 the Group disposed of 23.85% of the share capital of Assam Carbon Products Ltd ('Assam') for nil consideration. The Group retains a 28.8% shareholding. As a result of the transaction the Group no longer has control of Assam and has therefore deconsolidated the assets and liabilities of Assam in these consolidated financial statements. The loss recognised on the disposal of this shareholding was £2.3 million. Based on the Group's remaining 28.8% shareholding the Group accounts for the shareholding as an associate. The fair value of the Group's remaining investment has been measured at nil. The adjustment to the non-controlling interest component of equity due to this transaction was £0.6 million.

6. Discontinued operations

Discontinued operations in the year ended 31 December 2012 was a tax credit arising from the review and release of tax liabilities set up in prior years relating to business disposals.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 7. Earnings per share

Earnings per share from continuing operations

The calculation of basic/diluted earnings per share from continuing operations at 31 December 2013 was based on the following:

2013

2012

Basic

Diluted

Basic

Diluted

Restated

Restated

£m

£m

£m

£m

Profit attributable to equity holders of the Company from continuing operations

41.8

41.8

51.8

51.8

Weighted average number of Ordinary shares

Issued Ordinary shares at the beginning of the period (millions)

279.7

279.7

273.1

273.1

Effect of shares issued in period and shares held by The Morgan General Employee Benefit Trust (millions)

3.2

3.2

3.9

3.9

Dilutive effect of share options/incentive schemes (millions)

n/a

1.3

n/a

5.0

Basic/diluted weighted average number of Ordinary shares during the period (millions)

282.9

284.2

277.0

282.0

Earnings per share from continuing operations (pence)

14.8p

14.7p

18.7p

18.4p

Earnings per share from discontinued operations

The calculation of basic/diluted earnings per share from discontinued operations at 31 December 2013 was based on the following:

2013

2012

Basic

Diluted

Basic

Diluted

£m

£m

£m

£m

Profit attributable to equity holders of the Company from discontinued operations

-

-

21.0

21.0

Basic/diluted weighted average number of Ordinary shares during the period - calculated as above (millions)

282.9

284.2

277.0

282.0

Earnings per share from discontinued operations (pence)

0.0p

0.0p

7.6p

7.4p

Underlying earnings per share

The calculation of basic/diluted underlying earnings per share at 31 December 2013 was based on the following:

2013

2012

Basic

Diluted

Basic

Diluted

Restated

Restated

£m

£m

£m

£m

Underlying operating profit before specific adjusting items and amortisation, less net financing costs, income tax expense and non-controlling interests

60.7

60.7

60.1

60.1

Basic/diluted weighted average number of Ordinary shares during the period - calculated as above (millions)

282.9

284.2

277.0

282.0

Earnings per share before specific adjusting items and amortisation of intangible assets (pence)

21.5p

21.4p

21.7p

21.3p

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS 8. Cash and cash equivalents
		2013	2012
		£m	£m
Bank balances		60.3	64.2
Cash deposits		15.7	15.8
Cash and cash equivalents		76.0	80.0
Reconciliation of cash and cash equivalents to net debt*
		2013	2012
		£m	£m
Opening borrowings		(272.8)	(298.8)
Net decrease in borrowings		8.9	16.2
Payment of finance lease liabilities		0.1	0.2
Effect of movements in foreign exchange on borrowings		1.3	9.6
Closing borrowings		(262.5)	(272.8)
Cash and cash equivalents		76.0	80.0
Closing net debt		(186.5)	(192.8)
* Net debt is defined as interest-bearing loans and borrowings, bank overdrafts less cash and cash equivalents.

 

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