Question 1 - Financial Performance analysis. For the attached financial reports please carry out the following tasks a) Carryout at least 8 ratio analysis presented in an appropriate format (16 Marks) b) Analyse the company using the above ratios to critically evaluate the company's financial performance. (9 Marks) 2015 2017 Underlying Rema underlying Reme (note 4) Non underlying ms note 4 Underlying Total TO im 19.5 17.1 2 2 4,493.3 (273.2) 4,220.1 (3.818.2) 4019 (288.1) 42.7 19.5 (19.5) 4,512.8 (273.2) 4,239.6 (3.837.7) 401.9 (313.7) 42.7 4.265.2 (153.5) 4.111.7 (3.728.3) 383.4 (2682) 25.0 17.1 (1118) (947) (33.7 4.282.3 (153.5) 4.128.8 (3.840.1) 288.7 (301.9) 25.0 (25.6) 14 Continuing operations Revenue Group and share of joint ventures Less share of joint ventures Group revenue Cost of sales Gross profit/(loss) Administrative expenses Share of post tax results of joint ventures Profit/loss) on disposal of joint ventures and subsidiaries Profit/loss) from operations Finance Income Finance costs Profit/loss) before tax Taxation Profit/(loss) for the year from continuing operations 30 2.3 09.09 (137.4) (25.6) NO 18 3.5 160.0 0.9 (24.0) 136.9 (23.3) 3.5 134.4 0.9 (29.1) 106.2 (17.7) 5.4 145.6 18 (21.31 126.1 (21.9) (3.6) 8.2 1.8 (242) (14.21 (11.0) (5.1) (30.7) 5.6 (2.91 (140.3) 10.9 113.6 (25.1) 88.5 1042 (129.4) (25.2) Discontinued operations (Lossy profit for the year from discontinued operations attributable to equity holders of the parent) Profit/(loss) for the year (4.1) (10) 112.6 (1.0) 87.5 41.1 1883) 300:1 37.0 118 (25.1) Attributable to Owners of the parent Non controlling interests (25.1) 99.0 (883) 10.7 112.4 0.2 112.6 87.3 0.2 87.5 (25.1) 100.1 (88.3) 118 106.80 (4.210 102.60 (1340p 42.5 191.5p (27.29 38.30 11.10 (25.910 Basic eaming/loss) per share - From continuing operations 11 116.7 (25.99 90.8 - From discontinued operations 11 (1.010 (1.01p Total 115.79 89.89 Diluted earnings/(loss) per share - From continuing operations 11 115.4p (25.6) 89.8p - From discontinued operations 11 (1.0) (1.0) Total 114.4p (25.61p 88.89 Stated before non underlying items (see note 4). Restated to reclassify the profit on disposal of Mouchel Consulting within discontinued operations (see note 1) Non underlying revenue relates exclusively to Uk Mining operations 106.80 (4.29 102.60 (134.jp 42.50 (91.5 (27.200 38.30 11.10 2018 Notes Em 2017 Im 118 87.5 14 Sc 0.4 (0.1) (2.2) 0.4 14 2.3 14 27 5 9c Profit for the year Items that may be reclassified subsequently to the income statement Share of joint venture fair value movements on cash flow hedging instruments Deferred tax on share of joint venture fair value movements on cash flow hedging instruments Share of joint venture fair value movements on cash flow hedging instruments recycled to the income statement Deferred tax on share of joint venture fair value movements on cash flow hedging instruments recycled to the income statement Fair value (lossy/gain on cash flow hedging instruments Fair value movements on cash flow hedging instruments recycled to the income statement Deferred tax on fair value movements on cash flow hedging instruments Foreign exchange (losses/gains on long-term funding of foreign operations Foreign exchange translation differences Foreign exchange movements recycled to the income statement Total items that may be reclassified subsequently to the income statement Items that will not be reclassified to the income statement Remeasurement of defined benefit abilities Deferred tax (charge/credit on actuarial gains/(losses) on defined benefit liabilities Total items that will not be reclassified to the income statement Other comprehensive income/(loss) for the year Total comprehensive income/loss) for the year Attributable to: Equity holders of the parent Non controlling interests - continuing operations (0.4) (3.4) 1.6 0.3 (0.2) (0.3) (0.9) (0.7) 1.6 (4.2) 0.4 1.7 1.1 (3.7 (4.9) 8 SC 79.8 (13.6) 66.2 65.5 153.0 (29.3) 2.1 (272) (32.1) (20.3) 152.8 0.2 153.0 (21.4) 1.1 (20.3) Total comprehensive income/(loss) attributable to equity shareholders arises from: Continuing operations 153.8 (58.4) Discontinued operations (1.0) 37.0 152.8 (21.4) Restated to reclassify the profit on disposal of Mouchel Consulting within discontinued operations (see note 1). Amounts previously booked in the cash flow hedge reserve, arising from the fair value movements on cash flow hedging instruments, have been recycled to the income statement following the sale of the Group's interest in Evolution (Woking Holdings Limited. Amounts previously booked in the translation reserve, arising from retranslation of the results and balance sheet of the Group's Hong Kong and Middle East operations have been recycled to the income statement following the closure of those operations. equity Cash flow Retained hedge Translation earnings reserve reserve Em Em Em 13.5 (1.7) 5.6 10.7 (272) (4.0) (0.9) (63.0) Capital Share Share redemption capital premium reserve Em Em Em At 1 July 2016 1.0 418.0 2.7 Profit for the year Other comprehensive (loss) Dividends paid Issue of own shares 16.8 Purchase of own shares Share-based payments At 30 June 2017 1.0 434.8 2.7 Profit for the year Other comprehensive income Dividends paid Issue of own shares 0.2 Purchase of own shares Share-based payments At 30 June 2018 1.0 435.0 2.7 The numbers in the table above are shown net of tax as applicable. Equity attributable Non- Merger to owners of controlling Total reserve the parent interests Em Em Em Em 134.8 573.9 2.2 576.1 10.7 1.1 11.8 (32.1) (32.1) (63.0) (0.3) (63.3) 16.8 16.8 (0.6) (0.6) 2.7 2.7 134.8 508.4 3.0 511.4 87.3 0.2 87.5 65.5 65.5 (66.1) (1.5) (67.6) 0.2 0.2 (1.3) (1.3) 5.4 5.4 134.8 599.4 1.7601.1 (5.7) (0.6) 2.7 (63.9) 87.3 66.2 (66.1) 4.7 0.7 (1.4) (1.3) 5.4 27.6 (5.0) 3.3 12 2018 2001 Cashflows from operating activities Profi/floss before to continuing operations 1062 (142) discontinued operations 19 01.01 Nonunderlying terms excluding amortisation and finance costs 75.1 Net france cost 5 28.2 22.4 Share of post tax trading results of joint ventures 14 (427) 23.5 Nom cash contributions to pension fund in excess of pension charge Equity settled sharebased payments charge 25 SA 2.7 Amortisation of intangible assets less negative godilmecognised 12 37.7 30.1 Research and development expenditure credit Depreciation charges 13 19.7 Profit on disposal oot vertures 30d. (3.5) 15.4 Profit on disposal of property, plant and cement and intangible assets 10. (1.0 Operating canh Bows before movements in working capital 140.8 1421 Deficit contributions to pension funds (20.6) Decrease/Increase in inventories 20 (512) Increase in receivables 200 Increase in paties 20 720 Decrease in provisions 20 Cash now from operating sites before dying item 1408 021 Cash outlow from operating activities inondering terms (320) 20 Cash now from operating sites 103,5 001 Dividends from joint ventures 14 30.5 170 Interest received 5 09 18 Income tax paid 2.91 et cash lindore from operating activities 1303 75.7 Cash flows from Westing activities Proceeds from sale of property, plant and equipment Proceeds from all of us 26.0 Proceeds from sale of subsidiary Proceeds from sale of joint ventures rounderlying 9.7 Proceeds from sale of day ronden 589 Purchase of property and met (22.1) Purchase of the (412) Acquisition of subsidiaries (6) Investment in joint ventures 14 (715) 403 Petun of equity from joint ventures 14 5.6 Classification to assets held for sale 2.1 Met being with subsidiaries ad Met cash used in Investing activities (106.3 Cash flows from financing with les Issue of 24 02 32 Purchase of was (13) 10.6 Interest paid (217) (18.13 Cash outlowy now incured from raising france (2.0 09 wow from franceses en property det 21 1.7 wow from newborgs 3685 Financements 21 (10,20 Repayment of bonowings (13) (45.0 Dividends paid to quity holders of the parent 10 (6.1) Datens pod to me interest 01.31 Not cashned nom financing titles (1914 246 Decrease increase in cash, cash equivalents and eventut (167.4 3140 Effect of charging (15) 0.0 100 Closing cash, cashegualents and verder 20 Recome of the Cound me and to end 122 Kier Group Reported courts 2018 88 gaan 4005 Question 1 - Financial Performance analysis. For the attached financial reports please carry out the following tasks a) Carryout at least 8 ratio analysis presented in an appropriate format (16 Marks) b) Analyse the company using the above ratios to critically evaluate the company's financial performance. (9 Marks) 2015 2017 Underlying Rema underlying Reme (note 4) Non underlying ms note 4 Underlying Total TO im 19.5 17.1 2 2 4,493.3 (273.2) 4,220.1 (3.818.2) 4019 (288.1) 42.7 19.5 (19.5) 4,512.8 (273.2) 4,239.6 (3.837.7) 401.9 (313.7) 42.7 4.265.2 (153.5) 4.111.7 (3.728.3) 383.4 (2682) 25.0 17.1 (1118) (947) (33.7 4.282.3 (153.5) 4.128.8 (3.840.1) 288.7 (301.9) 25.0 (25.6) 14 Continuing operations Revenue Group and share of joint ventures Less share of joint ventures Group revenue Cost of sales Gross profit/(loss) Administrative expenses Share of post tax results of joint ventures Profit/loss) on disposal of joint ventures and subsidiaries Profit/loss) from operations Finance Income Finance costs Profit/loss) before tax Taxation Profit/(loss) for the year from continuing operations 30 2.3 09.09 (137.4) (25.6) NO 18 3.5 160.0 0.9 (24.0) 136.9 (23.3) 3.5 134.4 0.9 (29.1) 106.2 (17.7) 5.4 145.6 18 (21.31 126.1 (21.9) (3.6) 8.2 1.8 (242) (14.21 (11.0) (5.1) (30.7) 5.6 (2.91 (140.3) 10.9 113.6 (25.1) 88.5 1042 (129.4) (25.2) Discontinued operations (Lossy profit for the year from discontinued operations attributable to equity holders of the parent) Profit/(loss) for the year (4.1) (10) 112.6 (1.0) 87.5 41.1 1883) 300:1 37.0 118 (25.1) Attributable to Owners of the parent Non controlling interests (25.1) 99.0 (883) 10.7 112.4 0.2 112.6 87.3 0.2 87.5 (25.1) 100.1 (88.3) 118 106.80 (4.210 102.60 (1340p 42.5 191.5p (27.29 38.30 11.10 (25.910 Basic eaming/loss) per share - From continuing operations 11 116.7 (25.99 90.8 - From discontinued operations 11 (1.010 (1.01p Total 115.79 89.89 Diluted earnings/(loss) per share - From continuing operations 11 115.4p (25.6) 89.8p - From discontinued operations 11 (1.0) (1.0) Total 114.4p (25.61p 88.89 Stated before non underlying items (see note 4). Restated to reclassify the profit on disposal of Mouchel Consulting within discontinued operations (see note 1) Non underlying revenue relates exclusively to Uk Mining operations 106.80 (4.29 102.60 (134.jp 42.50 (91.5 (27.200 38.30 11.10 2018 Notes Em 2017 Im 118 87.5 14 Sc 0.4 (0.1) (2.2) 0.4 14 2.3 14 27 5 9c Profit for the year Items that may be reclassified subsequently to the income statement Share of joint venture fair value movements on cash flow hedging instruments Deferred tax on share of joint venture fair value movements on cash flow hedging instruments Share of joint venture fair value movements on cash flow hedging instruments recycled to the income statement Deferred tax on share of joint venture fair value movements on cash flow hedging instruments recycled to the income statement Fair value (lossy/gain on cash flow hedging instruments Fair value movements on cash flow hedging instruments recycled to the income statement Deferred tax on fair value movements on cash flow hedging instruments Foreign exchange (losses/gains on long-term funding of foreign operations Foreign exchange translation differences Foreign exchange movements recycled to the income statement Total items that may be reclassified subsequently to the income statement Items that will not be reclassified to the income statement Remeasurement of defined benefit abilities Deferred tax (charge/credit on actuarial gains/(losses) on defined benefit liabilities Total items that will not be reclassified to the income statement Other comprehensive income/(loss) for the year Total comprehensive income/loss) for the year Attributable to: Equity holders of the parent Non controlling interests - continuing operations (0.4) (3.4) 1.6 0.3 (0.2) (0.3) (0.9) (0.7) 1.6 (4.2) 0.4 1.7 1.1 (3.7 (4.9) 8 SC 79.8 (13.6) 66.2 65.5 153.0 (29.3) 2.1 (272) (32.1) (20.3) 152.8 0.2 153.0 (21.4) 1.1 (20.3) Total comprehensive income/(loss) attributable to equity shareholders arises from: Continuing operations 153.8 (58.4) Discontinued operations (1.0) 37.0 152.8 (21.4) Restated to reclassify the profit on disposal of Mouchel Consulting within discontinued operations (see note 1). Amounts previously booked in the cash flow hedge reserve, arising from the fair value movements on cash flow hedging instruments, have been recycled to the income statement following the sale of the Group's interest in Evolution (Woking Holdings Limited. Amounts previously booked in the translation reserve, arising from retranslation of the results and balance sheet of the Group's Hong Kong and Middle East operations have been recycled to the income statement following the closure of those operations. equity Cash flow Retained hedge Translation earnings reserve reserve Em Em Em 13.5 (1.7) 5.6 10.7 (272) (4.0) (0.9) (63.0) Capital Share Share redemption capital premium reserve Em Em Em At 1 July 2016 1.0 418.0 2.7 Profit for the year Other comprehensive (loss) Dividends paid Issue of own shares 16.8 Purchase of own shares Share-based payments At 30 June 2017 1.0 434.8 2.7 Profit for the year Other comprehensive income Dividends paid Issue of own shares 0.2 Purchase of own shares Share-based payments At 30 June 2018 1.0 435.0 2.7 The numbers in the table above are shown net of tax as applicable. Equity attributable Non- Merger to owners of controlling Total reserve the parent interests Em Em Em Em 134.8 573.9 2.2 576.1 10.7 1.1 11.8 (32.1) (32.1) (63.0) (0.3) (63.3) 16.8 16.8 (0.6) (0.6) 2.7 2.7 134.8 508.4 3.0 511.4 87.3 0.2 87.5 65.5 65.5 (66.1) (1.5) (67.6) 0.2 0.2 (1.3) (1.3) 5.4 5.4 134.8 599.4 1.7601.1 (5.7) (0.6) 2.7 (63.9) 87.3 66.2 (66.1) 4.7 0.7 (1.4) (1.3) 5.4 27.6 (5.0) 3.3 12 2018 2001 Cashflows from operating activities Profi/floss before to continuing operations 1062 (142) discontinued operations 19 01.01 Nonunderlying terms excluding amortisation and finance costs 75.1 Net france cost 5 28.2 22.4 Share of post tax trading results of joint ventures 14 (427) 23.5 Nom cash contributions to pension fund in excess of pension charge Equity settled sharebased payments charge 25 SA 2.7 Amortisation of intangible assets less negative godilmecognised 12 37.7 30.1 Research and development expenditure credit Depreciation charges 13 19.7 Profit on disposal oot vertures 30d. (3.5) 15.4 Profit on disposal of property, plant and cement and intangible assets 10. (1.0 Operating canh Bows before movements in working capital 140.8 1421 Deficit contributions to pension funds (20.6) Decrease/Increase in inventories 20 (512) Increase in receivables 200 Increase in paties 20 720 Decrease in provisions 20 Cash now from operating sites before dying item 1408 021 Cash outlow from operating activities inondering terms (320) 20 Cash now from operating sites 103,5 001 Dividends from joint ventures 14 30.5 170 Interest received 5 09 18 Income tax paid 2.91 et cash lindore from operating activities 1303 75.7 Cash flows from Westing activities Proceeds from sale of property, plant and equipment Proceeds from all of us 26.0 Proceeds from sale of subsidiary Proceeds from sale of joint ventures rounderlying 9.7 Proceeds from sale of day ronden 589 Purchase of property and met (22.1) Purchase of the (412) Acquisition of subsidiaries (6) Investment in joint ventures 14 (715) 403 Petun of equity from joint ventures 14 5.6 Classification to assets held for sale 2.1 Met being with subsidiaries ad Met cash used in Investing activities (106.3 Cash flows from financing with les Issue of 24 02 32 Purchase of was (13) 10.6 Interest paid (217) (18.13 Cash outlowy now incured from raising france (2.0 09 wow from franceses en property det 21 1.7 wow from newborgs 3685 Financements 21 (10,20 Repayment of bonowings (13) (45.0 Dividends paid to quity holders of the parent 10 (6.1) Datens pod to me interest 01.31 Not cashned nom financing titles (1914 246 Decrease increase in cash, cash equivalents and eventut (167.4 3140 Effect of charging (15) 0.0 100 Closing cash, cashegualents and verder 20 Recome of the Cound me and to end 122 Kier Group Reported courts 2018 88 gaan 4005