| 2013
£m | 2012
(Restated)
£m |
|---|
| Revenue | 619.6 | 587.8 |
| Operating profit | 102.1 | 93.0 |
| Profit on disposal of investments | – | (2.4) |
| Acquisition costs | – | 2.5 |
| Reorganisation costs | 0.8 | 2.4 |
| Operating profit prior to exceptional items | 102.9 | 95.5 |
| Amortisation of acquired intangible fixed assets | 4.5 | 2.0 |
| Headline operating profit | 107.4 | 97.5 |
Group revenue was £619.6m, an increase of 5.4%, of which acquisitions accounted for 5.5%, with organic revenues down 2.5% and foreign exchange rate movements having a positive impact of 2.4%.
Headline operating profit for the year increased by 10.2% from £97.5m to £107.4m, and headline operating margin was 17.3% (2012: 16.6%). Acquisitions made in the prior year increased headline operating profit by £6.7m. The impact of foreign currency movements in the year was an increase in headline operating profit of £3.6m. Despite a £14.8m decline in organic revenue, organic headline operating profit decreased by only £0.4m.
Cash flow is analysed as follows:
| 2013
£m | 2012
(Restated)
£m |
|---|
| Headline operating profit | 107.4 | 97.5 |
| Add back non-cash items: | | |
| Depreciation and amortisation | 52.9 | 50.5 |
| Impairment of fixed assets | 5.1 | 0.7 |
| Share-based payments | 3.6 | 3.9 |
| (Profit) / loss on disposal of property, plant and equipment | (0.1) | 0.1 |
| Headline EBITDA1 | 168.9 | 152.7 |
| Net capital expenditure | (57.3) | (47.7) |
| Net working capital movement | (2.7) | 5.8 |
| Headline operating cash flow | 108.9 | 110.8 |
| Cash cost of restructuring | (4.3) | (5.3) |
| Acquisition costs | – | (2.5) |
| Operating cash flow | 104.6 | 103.0 |
| Interest | (3.3) | (2.5) |
| Taxation | (22.5) | (19.3) |
| Free cash flow | 78.8 | 81.2 |
Strong profit growth, disciplined capital spending and working capital control have resulted in excellent operating cash flow of £104.6m (2012: £103.0m). Group net cash at 31 December 2013 was £15.0m (2012: net debt £34.2m).
Capital expenditure continued to be managed carefully. Capital spend (net of asset sales) in 2013 was £57.3m (2012: £47.7m), being 1.0 times depreciation2 (2012: 0.9 times). There has been a continued focus on cash collection and receivable days at 31 December 2013 were 59 days (31 December 2012: 58 days). The net working capital outflow in the year is primarily a result of a decrease in payables, offset by a modest decrease in receivables.
- Earnings before interest, tax, depreciation, amortisation, share-based payments, impairment of fixed assets, profit or loss on disposal of property, plant and equipment and exceptional items.
- Net capital expenditure to depreciation ratio is defined as capital expenditure less proceeds from asset disposals as a proportion of depreciation and amortisation plus impairment of fixed assets.