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Media
Half Year Results 2012
01 Aug 2012
This year, our objectives are centred on investing in and building the foundations for future growth. We have been very active and have made good progress.
Financial Highlights (continuing operations)
- Revenue of £322.7 million (HY 2011: £322.0 million*)
- Adjusted operating profit of £16.0 million (HY 2011: £13.8 million)
- Operating cash flow of £26.6 million (HY 2011: £8.0 million*)
- Return on invested capital of 23.6% (HY 2011: 21.6%)
- Adjusted operating profit margin of 5.0% (HY 2011: 4.3%*)
- Statutory operating profit of £14.0 million (HY 2011: £3.2 million)
- Adjusted basic earnings per share (EPS) of 2.49 pence (HY 2011: 1.63 pence)
- Net cash of £62.1 million (HY 2011: £37.8 million*)
Operational Highlights
- Some benefits from previous cost savings invested in business development
- Incremental flow of contract wins
- Insurance Services delivered good performance
- New global (re)insurance and accounting settlements service (Project Sorrento) progresses towards pilot launch in Q4
- Financial Services and Corporate maintained cost savings from 2011
- 2011 new Procurement contracts in implementation phase
- Technology transformation underway; insurance software product, Xuber, launch due Q4
- Improved South East Asia performance
- Official inauguration of new centre at Shimoga, India
Financial Summary (continuing operations)
| HY 2012 | HY 2011 | Increase | ||||||
| Revenue* (£m) | 322.7 | 322.0 | 0.2% | |||||
| Adjusted operating profit1 (£m) | 16.0 | 13.8 | 15.9% | |||||
| Adjusted profit before tax (£m) | 14.0 | 11.9 | 17.6% | |||||
| Operating cash flow2* (£m) | 26.6 | 8.0 | 232.5% | |||||
| Return on invested capital3 (%) | 23.6 | 21.6 | 200 bps | |||||
| Adjusted operating profit margin* (%) | 5.0 | 4.3 | 67 bps | |||||
| Statutory operating profit (£m) | 14.0 | 3.2 | 337.5% | |||||
| Adjusted EPS - basic (pence) | 2.49 | 1.63 | 52.8% | |||||
| Equity free cash flow4* (£m) | 19.4 | 3.0 | 546.7% | |||||
| Net cash5* (£m) | 62.1 | 37.8 | 64.3% |
Notes:
* The comparative amounts have been restated to reflect changes in accounting policies. Further explanation of the restatements is included in note 1 (ii) on page 23 of the full results.
1. Adjusted operating profit excludes exceptional items (HY 2012: £nil, HY 2011: £8.2 million), and amortisation of intangible assets previously unrecognised by acquired entities (HY 2012: £2.0 million, HY 2011: £2.4 million).
2. Operating cash flow is calculated as cash generated from operations less net capital expenditure (including pre-contract costs) and dividends to non-controlling interests.
3. Return on invested capital is adjusted operating profit less a tax charge at the Group’s effective rate for a rolling twelve month period, divided by invested capital at the period end date. Invested capital is calculated as the Group’s net assets less net cash.
4. Equity free cash flow is calculated as operating cash flow (as defined above) less cash tax and net interest paid.
5. Net cash is calculated as cash and cash equivalents less bank loans and overdrafts and finance lease liabilities.
Ken Lever, Chief Executive, commented:
“The results for the first half show encouraging progress. Behind these results there has been a considerable amount of activity building the foundations for renewed growth, and we can point to the first signs of the impact this has started to have. We have also continued to address the challenge of repositioning Xchanging in the business processing marketplace. We expect progress to continue as we move through the second half.”
Enquiries
Xchanging plc
David Bauernfeind, Chief Financial Officer
Alexandra Hockenhull, Head of Corporate Communications and Investor Relations
Tel: +44 (0) 207 780 6999
Maitland
Neil Bennett
George Hudson
Emma Burdett
Tel: +44 (0) 207 379 5151
A presentation for investors and analysts will be held at the City Presentation Centre, 4 Chiswell Street, London, EC1Y 4UP at 09:30 on 1 August 2012. For those unable to attend, a live webcast of the presentation will be available on the company website, www.xchanging.com.
For those not able to join in this way please dial +44 (0) 145 255 5566 and enter conference ID 11605427 to listen to the live audio or to the audio recording that will be available after the presentation.
About Xchanging
What we are
Xchanging provides business processing, technology and procurement services internationally for customers across multiple industries.
What we do
Xchanging brings innovation, thought leadership and passion to its customers’ businesses so as to enhance performance and value. Our values are embedded into everything we do.
What we want to be
Xchanging wants to be regarded as the best provider in its chosen markets by delivering services that are recognised for outstanding quality, reliability and innovation.
Cautionary Statement:
This announcement contains forward-looking statements that are based on current expectations or beliefs, as well as assumptions about future events. These forward-looking statements can be identified by the fact that they do not relate only to historical or current facts. Forward-looking statements often use words such as anticipate, target, expect, estimate, intend, plan, goal, believe, will, may, should, would, could, is confident, or other words of similar meaning. Undue reliance should not be placed on any such statements because they speak only as at the date of this document and, by their very nature, they are subject to known and unknown risks and uncertainties and can be affected by other factors that could cause actual results, and Xchanging's plans and objectives, to differ materially from those expressed or implied in the forward-looking statements.
There are a number of factors which could cause actual results to differ materially from those expressed or implied in forward-looking statements. Among the factors that could cause actual results to differ materially from those described in the forward-looking statements are; increased competition, the loss of or damage to one or more key customer relationships, changes to customer ordering patterns, delays in obtaining customer approval or price level changes, the failure of one or more key suppliers, the outcome of business or industry restructuring, the outcome of any litigation, changes in economic conditions, currency fluctuations, changes in interest and tax rates, changes in raw material or energy market prices, changes in laws, regulations or regulatory policies, developments in legal or public policy doctrines, technological developments, the failure to retain key management, or the key timing and success of future acquisition opportunities or major investment projects.
Half Year Results 2012 (3242KB PDF)