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Manchester United PLC Reports Third Quarter Fiscal 2021 Results

Key Points

  • The men’s first team finished the 2020/21 domestic season in 2nd place and will compete in the UEFA Champions’ League in the 2021/22 season
  • Old Trafford welcomed back 10,000 supporters to the final home match on 18 May
  • Season ticket sales have commenced for the upcoming season
  • TeamViewer will replace Chevrolet as shirt sponsor on team kits from the start of the 2021/22 season
  • The “Theatre of Dreams” Experience Centre, in partnership with Harves, opened to the public in Beijing on 1 May
  • The Premier League successfully completed the sale of domestic broadcast rights for the 2022-2025 cycle

Manchester United (NYSE:MANU; the “Company” and the “Group”) – one of the most popular and successful sports teams in the world - today announced financial results for the 2021 fiscal third quarter ended 31 March 2021.

Management Commentary

Ed Woodward, Executive Vice Chairman, commented, “The absence of fans over the past year has proved that they are the lifeblood of the game. Following the successful return of limited numbers at the end of last season, and continued trials of increased crowds at sports events this summer, we remain optimistic about the prospect of fans returning to Old Trafford in larger numbers going forwards. With the foundations for long-term success in place, including significant initiatives to strengthen engagement with our supporters, we look forward to the upcoming season.”

Key Financials (unaudited)

£ million (except (loss)/earnings per share)

Three months ended

31 March 2021

 

Nine months ended

31 March 2021

 

 

2021

2020

Change

2021

2020

Change

Commercial revenue

58.1

68.6

(15.3%)

180.4

219.6

(17.9%)

Broadcasting revenue

58.6

26.0

125.4%

214.9

123.6

73.9%

Matchday revenue

1.6

29.1

(94.5%)

4.8

84.3

(94.3%)

Total revenue

118.3

123.7

(4.4%)

400.1

427.5

(6.4%)

Adjusted EBITDA(1)

14.4

27.9

(48.4%)

105.5

134.8

(21.7%)

Operating (loss)/profit

(21.6)

(3.3)

554.5%

(0.2)

44.2

-

 

(Loss)/profit for the period (i.e. net (loss)/income)

(18.1)

(22.8)

(20.6%)

15.4

13.3

15.8%

Basic (loss)/earnings per share (pence)

(11.12)

(13.89)

(20.0%)

9.48

8.07

17.5%

Adjusted (loss)/profit for the period (i.e. adjusted net (loss)/income)(1)

(21.7)

(7.3)

197.3%

(11.0)

22.4

-

Adjusted basic (loss)/earnings per share (pence)(1)

(13.30)

(4.42)

200.9%

(6.73)

13.61

-

 

Non-current and current borrowings

528.2

519.4

1.7%

528.2

519.4

1.7%

Cash and cash equivalents

84.7

90.3

(6.2%)

84.7

90.3

(6.2%)

Net debt(1)/(2)

443.5

429.1

3.4%

443.5

429.1

3.4%

(1) Adjusted EBITDA, adjusted profit for the period, adjusted basic earnings per share and net debt are non-IFRS measures. See “Non-IFRS Measures: Definitions and Use” on page 7 and the accompanying Supplemental Notes for the definitions and reconciliations for these non-IFRS measures and the reasons we believe these measures provide useful information to investors regarding the Group’s financial condition and results of operations.

 

(2) The gross USD debt principal remains unchanged. Non-current and current borrowings and cash and cash equivalents as at 31 March 2021 reflect the impact a £60.0 million drawdown on our £200 million revolving credit facilities during the second fiscal quarter.

COVID-19 Impact

Operationally, the impact of the pandemic and measures to prevent further spread continues to disrupt our businesses. The Old Trafford Stadium, Megastore, Museum and Stadium Tour operations remained closed to visitors throughout the third fiscal quarter. In line with government guidelines, and with a variety of safety measures and protocols in place, including reduced fan capacity, Old Trafford Stadium welcomed back 10,000 supporters for final home match of the season. The Megastore and Museum and Stadium Tour operations have also resumed following the end of the quarter.

Commencement of playing the 2020/21 Premier league fixtures was delayed until 19 September 2020, due to the deferred completion of the 2019/20 season. 2020/21 matches were played over a more condensed period with most of the current season shortfall being played in the third and fourth quarters, as outlined below.

During the third quarter, the first team played in fourteen Premier League home and away matches, compared with nine in the prior year quarter, resulting in an increase in Broadcasting revenues over the prior year quarter. The prior year quarter was further impacted by an estimated Premier League rebate due to broadcasters, following delay and broadcast schedule changes to the 2019/20 season.

Home matches continue to be played behind closed doors. During the third quarter, a total of twelve home matches were played behind closed doors across all competitions, compared with a total eight home matches with fans in attendance during the prior quarter, creating a significant shortfall in Matchday revenues. This largely offsets the increase in Broadcasting revenues, due to the men’s first team’s participation in the UEFA Champions League.

Given ongoing uncertainty due to the COVID-19 pandemic, the Company is not providing revenue or adjusted EBITDA guidance for fiscal 2021 at this time.

Phasing of Premier League games

 

Quarter 1

 

Quarter 2

 

Quarter 3

 

Quarter 4

 

Total

2020/21 season

 

2

 

13

 

14

 

9

 

38

2019/20 remaining season

 

6

 

-

 

-

 

-

 

6

Total FY 2021

 

8

 

13

 

14

 

9

 

44

2019/20 season

 

7

 

13

 

9

 

3

 

32

2018/19 season

 

7

 

13

 

11

 

7

 

38

Working Capital and Liquidity

As of 31 March 2021, the Company had £84.7 million of cash balances together with access to an additional £140.0 million available under the Company’s revolving credit facilities. This provides financial flexibility to support the Club through the disruption caused by COVID-19.

Revenue Analysis

Commercial

Commercial revenue for the quarter was £58.1 million, a decrease of £10.5 million, or 15.3%, over the prior year quarter.

  • Sponsorship revenue was £35.8 million, a decrease of £8.9 million, or 19.9%, over the prior year quarter, due to COVID-19 related variations and a one-time sponsorship credit in the prior quarter.
  • Retail, Merchandising, Apparel & Product Licensing revenue was £22.3 million, a decrease of £1.6 million, or 6.7%, over the prior year quarter, primarily due to the continued closure of the Old Trafford based Megastore.

Broadcasting

Broadcasting revenue for the quarter was £58.6 million, an increase of £32.6 million, or 125.4%, over the prior year quarter, due to playing an additional five Premier League home and away games in the quarter. The prior year quarter was further impacted by an estimated Premier League rebate due to broadcasters, following delay and broadcast schedule changes to the 2019/20 season.

Matchday

Matchday revenue for the quarter was £1.6 million, a decrease of £27.5 million, or 94.5%, over the prior year quarter, due to all matches being played behind closed doors. Eight home games with fans in attendance were played in the prior year quarter, prior to the postponement of all competitions.

Other Financial Information

Operating expenses

Total operating expenses for the quarter were £138.5 million, an increase of £6.7 million, or 5.1%, over the prior year quarter.

Employee benefit expenses

Employee benefit expenses for the quarter were £85.2 million, an increase of £15.7 million, or 22.6%, over the prior year quarter. This is due to contracted increases in player salaries due to participation in the UEFA Champions League and continued investment in the first team playing squad.

Other operating expenses

Other operating expenses for the quarter were £18.7 million, a decrease of £7.6 million, or 28.9%, over the prior year quarter, primarily due to reduced business activity as a result of COVID-19. This includes the impact of all matches being played behind closed doors.

Depreciation and amortization

Depreciation for the quarter was £3.8 million, an increase of £0.1 million or 2.7% over the prior year quarter. Amortization for the quarter was £30.8 million, a decrease of £1.5 million, or 4.6%, over the prior year quarter. The unamortized balance of registrations on 31 March 2021 was £350.0 million.

Loss/(profit) on disposal of intangible assets

Loss on disposal of intangible assets for the quarter was £1.4 million, compared to a profit of £4.8 million for the prior year quarter.

Net finance costs

Net finance costs for the quarter were £1.4 million, compared to net finance costs of £25.3 million in the prior year quarter. The movement was driven by foreign exchange gains on unhedged USD borrowings in the current year quarter compared to foreign exchange losses on unhedged USD borrowings in the prior year quarter.

Income tax

The income tax credit for the quarter was £4.9 million, compared to a credit of £5.8 million in the prior year quarter.

Cash flows

Overall cash and cash equivalents (including the effects of exchange rate movements) increased by £4.1 million in the quarter to 31 March 2021, compared to a decrease of £10.6 million in the prior year quarter.

Net cash inflow from operating activities for the quarter was £27.0 million, an increase of £0.7 million compared to a net cash inflow in the prior year quarter of £26.3 million.

Net capital expenditure on property, plant and equipment for the quarter was £1.8 million, a decrease of £2.9 million over the prior year quarter.

Net capital expenditure on intangible assets for the quarter was £7.9 million, a decrease of £13.3 million over the prior year quarter.

Net debt

Net Debt as of 31 March 2021 was £443.5 million, compared with £429.1 million as of 31 March 2020.

Dividend

A semi-annual cash dividend of $0.09 per share will be paid on 30 July 2021, to shareholders of record on 12 July 2021. The stock will begin to trade ex-dividend on 9 July 2021.

About Manchester United

Manchester United is one of the most popular and successful sports teams in the world, playing one of the most popular spectator sports on Earth. Through our 143-year football heritage we have won 66 trophies, enabling us to develop what we believe is one of the world’s leading sports and entertainment brands with a global community of 1.1 billion fans and followers. Our large, passionate and highly engaged fan base provides Manchester United with a worldwide platform to generate significant revenue from multiple sources, including sponsorship, merchandising, product licensing, broadcasting and matchday initiatives which in turn, directly fund our ability to continuously reinvest in the club.

Cautionary Statements

This press release contains forward-looking statements. You should not place undue reliance on such statements because they are subject to numerous risks and uncertainties relating to the Company’s operations and business environment, all of which are difficult to predict and many are beyond the Company’s control. Forward-looking statements include information concerning certain expectations and uncertainties related to the COVID-19 pandemic and the Company’s possible or assumed future results of operations, including descriptions of its business strategy. These statements often include words such as “may,” “might,” “will,” “could,” “would,” “should,” “expect,” “plan,” “anticipate,” “intend,” “seek,” “believe,” “estimate,” “predict,” “potential,” “continue,” “contemplate,” “possible” or similar expressions. The forward-looking statements contained in this press release are based on our current expectations and estimates of future events and trends, which affect or may affect our businesses and operations. You should understand that these statements are not guarantees of performance or results. They involve known and unknown risks, uncertainties and assumptions. Although the Company believes that these forward-looking statements are based on reasonable assumptions, you should be aware that many factors could affect its actual financial results or results of operations and could cause actual results to differ materially from those in these forward-looking statements. These factors are more fully discussed in the “Risk Factors” section and elsewhere in the Company’s Registration Statement on Form F-1, as amended (File No. 333-182535) and the Company’s Annual Report on Form 20-F (File No. 001-35627).

Non-IFRS Measures: Definitions and Use

1. Adjusted EBITDA

Adjusted EBITDA is defined as profit for the period before depreciation, amortization, profit/loss on disposal of intangible assets, net finance costs/income, and tax.

Adjusted EBITDA is useful as a measure of comparative operating performance from period to period and among companies as it is reflective of changes in pricing decisions, cost controls and other factors that affect operating performance, and it removes the effect of our asset base (primarily depreciation and amortization), material volatile items (primarily loss/profit on disposal of intangible assets and exceptional items), capital structure (primarily finance costs/income), and items outside the control of our management (primarily taxes). Adjusted EBITDA has limitations as an analytical tool, and you should not consider it in isolation, or as a substitute for an analysis of our results as reported under IFRS as issued by the IASB. A reconciliation of (loss)/profit for the period to adjusted EBITDA is presented in supplemental note 2.

2. Adjusted (loss)/profit for the period (i.e. adjusted net (loss)/income)

Adjusted (loss)/profit for the period is calculated, where appropriate, by adjusting for charges/credits related to exceptional items, foreign exchange gains/losses on unhedged US dollar denominated borrowings (including foreign exchange losses immediately reclassified from the hedging reserve following change in contract currency denomination of future revenues), and fair value movements on embedded foreign exchange derivatives and foreign currency options, adding/subtracting the actual tax expense/credit for the period, and subtracting/adding the adjusted tax expense/credit for the period (based on a normalized tax rate of 21%; 2020: 21%). The normalized tax rate of 21% is the current US federal corporate income tax rate.

In assessing the comparative performance of the business, in order to get a clearer view of the underlying financial performance of the business, it is useful to strip out the distorting effects of the items referred to above and then to apply a ‘normalized’ tax rate (for both the current and prior periods) of the weighted average US federal corporate income tax rate of 21% (2020: 21%) applicable during the financial year. A reconciliation of (loss)/profit for the period to adjusted (loss)/profit for the period is presented in supplemental note 3.

3. Adjusted basic and diluted (loss)/earnings per share

Adjusted basic and diluted (loss)/earnings per share are calculated by dividing the adjusted (loss)/profit for the period by the weighted average number of ordinary shares in issue during the period. Adjusted diluted (loss)/earnings per share is calculated by adjusting the weighted average number of ordinary shares in issue during the period to assume conversion of all dilutive potential ordinary shares. There is one category of dilutive potential ordinary shares: share awards pursuant to the 2012 Equity Incentive Plan (the “Equity Plan”). Share awards pursuant to the Equity Plan are assumed to have been converted into ordinary shares at the beginning of the financial year. Adjusted basic and diluted (loss)/earnings per share are presented in supplemental note 3.

4. Net debt

Net debt is calculated as non-current and current borrowings minus cash and cash equivalents.

Key Performance Indicators

 

Three months ended

Nine months ended

31 March

31 March

 

2021

2020

2021

2020

 

 

 

 

 

Revenue

 

 

 

 

Commercial % of total revenue

49.1%

55.5%

45.1%

51.4%

Broadcasting % of total revenue

49.5%

21.0%

53.7%

28.9%

Matchday % of total revenue

1.4%

23.5%

1.2%

19.7%

 

 

 

 

 

 

2020/21

Season

2019/20

Season

2020/21

Season

Carryover

2019/20

Season

2019/20

Season

Home Matches Played

 

 

 

 

 

PL

6

5

14

3

15

UEFA competitions

2

1

5

1

4

Domestic Cups

4

2

4

-

4

Away Matches Played

 

 

 

 

 

PL

8

4

15

3

14

UEFA competitions

2

2

5

2

5

Domestic Cups

1

4

4

1

5

 

 

Other

 

 

 

 

Employees at period end

976

997

976

997

Employee benefit expenses % of revenue

72.0%

56.2%

59.7%

49.3%

CONSOLIDATED STATEMENT OF PROFIT OR LOSS

(unaudited; in £ thousands, except per share and shares outstanding data)

 

 

Three months ended

31 March

 

Nine months ended

31 March

 

 

2021

 

 

2020

 

 

2021

 

 

2020

 

Revenue from contracts with customers

 

118,286

 

 

123,711

 

 

400,108

 

 

427,537

 

Operating expenses

 

(138,444

)

 

(131,783

)

 

(400,576

)

 

(399,457

)

(Loss)/profit on disposal of intangible assets

 

(1,424

)

 

4,765

 

 

259

 

 

16,067

 

Operating (loss)/profit

 

(21,582

)

 

(3,307

)

 

(209

)

 

44,147

 

Finance costs

 

(6,388

)

 

(25,758

)

 

(29,887

)

 

(19,701

)

Finance income

 

4,948

 

 

511

 

 

48,170

 

 

1,274

 

Net finance (costs)/income

 

(1,440

)

 

(25,247

)

 

18,283

 

 

(18,427

)

(Loss)/profit before income tax

 

(23,022

)

 

(28,554

)

 

18,074

 

 

25,720

 

Income tax credit/(expense)

 

4,911

 

 

5,701

 

 

(2,627

)

 

(12,438

)

(Loss)/profit for the period

 

(18,111

)

 

(22,853

)

 

15,447

 

 

13,282

 

 

 

 

 

 

 

 

 

 

Basic earnings per share:

 

 

 

 

 

 

 

 

Basic (loss)/earnings per share (pence)

 

(11.12

)

 

(13.89

)

 

9.48

 

 

8.07

 

Weighted average number of ordinary shares used as the denominator in calculating basic (loss)/earnings per share (thousands)

 

162,939

 

 

164,544

 

 

162,939

 

 

164,563

 

Diluted earnings per share:

 

 

 

 

 

 

 

 

Diluted (loss)/earnings per share (pence) (1)

 

(11.12

)

 

(13.89

)

 

9.45

 

 

8.06

 

Weighted average number of ordinary shares and potential ordinary shares used as the denominator in calculating diluted (loss)/earnings per share (thousands) (1)

 

162,939

 

 

164,544

 

 

163,400

 

 

164,746

 

         

(1) For the three months ended 31 March 2021 and the three months ended 31 March 2020, potential ordinary shares are anti-dilutive, as their inclusion in the diluted loss per share calculation would reduce the loss per share, and hence have been excluded.

CONSOLIDATED BALANCE SHEET

(unaudited; in £ thousands)

   

 

 

As of

 

 

31 March

2021

 

30 June

2020

 

31 March

2020

ASSETS

 

 

 

 

 

 

Non-current assets

 

 

 

 

 

 

Property, plant and equipment

 

248,985

 

254,439

 

254,994

Right-of-use assets

 

4,719

 

4,559

 

4,984

Investment properties

 

20,623

 

20,827

 

24,703

Intangible assets

 

776,587

 

775,170

 

784,746

Deferred tax asset

 

61,928

 

58,362

 

54,061

Trade receivables

 

26,397

 

43,694

 

42,429

Derivative financial instruments

 

651

 

1,609

 

1,134

 

 

1,139,890

 

1,158,660

 

1,167,051

Current assets

 

 

 

 

 

 

Inventories

 

2,363

 

2,186

 

2,403

Prepayments

 

12,586

 

6,503

 

10,868

Contract assets – accrued revenue

 

50,279

 

45,966

 

42,700

Trade receivables

 

32,127

 

115,985

 

41,106

Other receivables

 

1,483

 

239

 

121

Income tax receivable

 

1,223

 

1,214

 

1,223

Derivative financial instruments

 

845

 

1,174

 

690

Cash and cash equivalents

 

84,715

 

51,539

 

90,251

 

 

185,621

 

224,806

 

189,362

Total assets

 

1,325,511

 

1,383,466

 

1,356,413

CONSOLIDATED BALANCE SHEET (continued)

(unaudited; in £ thousands)

 

 

 

As of

 

 

31 March

2021

 

30 June

2020

 

31 March

2020

EQUITY AND LIABILITIES

 

 

 

 

 

 

Equity

 

 

 

 

 

 

Share capital

 

53

 

 

53

 

 

53

 

Share premium

 

68,822

 

 

68,822

 

 

68,822

 

Treasury shares

 

(21,305

)

 

(21,305

)

 

(3,720

)

Merger reserve

 

249,030

 

 

249,030

 

 

249,030

 

Hedging reserve

 

(11,212

)

 

(32,565

)

 

(35,521

)

Retained earnings

 

94,170

 

 

87,197

 

 

135,391

 

 

 

379,558

 

 

351,232

 

 

414,055

 

Non-current liabilities

 

 

 

 

 

 

Deferred tax liabilities

 

25,270

 

 

31,337

 

 

37,126

 

Contract liabilities - deferred revenue

 

11,279

 

 

18,759

 

 

25,562

 

Trade and other payables

 

67,075

 

 

51,322

 

 

51,980

 

Borrowings

 

466,030

 

 

520,010

 

 

517,075

 

Lease liabilities

 

3,201

 

 

3,326

 

 

3,416

 

Derivative financial instruments

 

6,347

 

 

9,136

 

 

8,538

 

 

 

579,202

 

 

633,890

 

 

643,697

 

Current liabilities

 

 

 

 

 

 

Contract liabilities - deferred revenue

 

108,766

 

 

171,574

 

 

99,240

 

Trade and other payables

 

180,374

 

 

216,093

 

 

191,214

 

Income tax liabilities

 

13,709

 

 

4,005

 

 

4,214

 

Borrowings

 

62,179

 

 

5,605

 

 

2,302

 

Lease liabilities

 

1,444

 

 

1,067

 

 

1,687

 

Derivative financial instruments

 

279

 

 

-

 

 

4

 

 

 

366,751

 

 

398,344

 

 

298,661

 

Total equity and liabilities

 

1,325,511

 

 

1,383,466

 

 

1,356,413

 

CONSOLIDATED STATEMENT OF CASH FLOWS

(unaudited; in £ thousands)

 

 

 

Three months ended

31 March

 

Nine months ended

31 March

 

 

2021

£’000

 

2020

£’000

 

2021

£’000

 

2020

£’000

Cash flows from operating activities

 

 

 

 

 

 

 

 

Cash generated from operations (see supplemental note 4)

 

35,654

 

 

34,333

 

 

110,164

 

 

15,894

 

Interest paid

 

(8,678

)

 

(7,944

)

 

(18,862

)

 

(18,450

)

Interest received

 

1

 

 

115

 

 

2

 

 

1,165

 

Tax received/(paid)

 

28

 

 

(200

)

 

(3,028

)

 

(1,897

)

Net cash inflow/(outflow) from operating activities

 

27,005

 

 

26,304

 

 

88,276

 

 

(3,288

)

Cash flows from investing activities

 

 

 

 

 

 

 

 

Payments for property, plant and equipment

 

(1,782

)

 

(4,662

)

 

(4,940

)

 

(17,692

)

Payments for intangible assets

 

(17,785

)

 

(24,419

)

 

(126,560

)

 

(211,730

)

Proceeds from sale of intangible assets

 

9,898

 

 

3,225

 

 

32,080

 

 

25,234

 

Payments for derivative financial assets

 

-

 

 

-

 

 

(939

)

 

-

 

Net cash outflow from investing activities

 

(9,669

)

 

(25,856

)

 

(100,359

)

 

(204,188

)

Cash flows from financing activities

 

 

 

 

 

 

 

 

Acquisition of treasury shares

 

-

 

 

(3,372

)

 

-

 

 

(3,372

)

Proceeds from borrowings

 

-

 

 

-

 

 

60,000

 

 

-

 

Principal elements of lease payments

 

(411

)

 

(399

)

 

(1,231

)

 

(1,160

)

Dividends paid

 

(10,718

)

 

(11,323

)

 

(10,718

)

 

(11,323

)

Net cash (outflow)/inflow from financing activities

 

(11,129

)

 

(15,094

)

 

48,051

 

 

(15,855

)

Net increase/(decrease) in cash and cash equivalents

 

6,207

 

 

(14,646

)

 

35,968

 

 

(223,331

)

Cash and cash equivalents at beginning of period

 

80,620

 

 

100,856

 

 

51,539

 

 

307,637

 

Effects of exchange rate movements on cash and cash equivalents

 

(2,112

)

 

4,041

 

 

(2,792

)

 

5,945

 

Cash and cash equivalents at end of period

 

84,715

 

 

90,251

 

 

84,715

 

 

90,251

 

SUPPLEMENTAL NOTES

1 General information

Manchester United plc (the “Company”) and its subsidiaries (together the “Group”) is a men’s and women’s professional football club together with related and ancillary activities. The Company incorporated under the Companies Law (as amended) of the Cayman Islands.

2 Reconciliation of (loss)/profit for the period to adjusted EBITDA

 

Three months ended

31 March

Nine months ended

31 March

 

2021

£’000

2020

£’000

2021

£’000

2020

£’000

(Loss)/profit for the period

(18,111

)

(22,853

)

15,447

 

13,282

 

Adjustments:

 

 

 

 

Income tax (credit)/expense

(4,911

)

(5,701

)

2,627

 

12,438

 

Net finance costs/(income)

1,440

 

25,247

 

(18,283

)

18,427

 

Loss/(profit) on disposal of intangible assets

1,424

 

(4,765

)

(259

)

(16,067

)

Amortization

30,728

 

32,346

 

94,730

 

95,790

 

Depreciation

3,795

 

3,683

 

11,244

 

10,951

 

Adjusted EBITDA

14,365

 

27,957

 

105,506

 

134,821

 

3 Reconciliation of (loss)/profit for the period to adjusted (loss)/profit for the period and adjusted basic and diluted (loss)/earnings per share

 

 

 

Three months ended

31 March

 

Nine months ended

31 March

 

 

 

2021

£’000

 

2020

£’000

 

2021

£’000

 

2020

£’000

(Loss)/profit for the period

 

(18,111

)

 

(22,853

)

 

15,447

 

 

13,282

 

Foreign exchange (gains)/losses on unhedged US dollar denominated borrowings

 

(4,120

)

 

19,664

 

 

(46,955

)

 

2,590

 

Foreign exchange (gains)/losses immediately reclassified from the hedging reserve following change in contract currency denomination of future revenues

 

(206

)

 

-

 

 

14,631

 

 

-

 

Fair value movement on embedded foreign exchange derivatives

 

(85

)

 

(307

)

 

361

 

 

39

 

Income tax (credit)/expense

 

(4,911

)

 

(5,701

)

 

2,627

 

 

12,438

 

Adjusted (loss)/profit before income tax

 

(27,433

)

 

(9,197

)

 

(13,889

)

 

28,349

 

Adjusted income tax credit/(expense) (using a normalized tax rate of 21% (2020: 21%))

 

5,761

 

 

1,931

 

 

2,917

 

 

(5,953

)

Adjusted (loss)/profit for the period (i.e. adjusted net (loss)/income)

 

(21,672

)

 

(7,266

)

 

(10,972

)

 

22,396

 

 

 

 

 

 

 

 

 

 

Adjusted basic (loss)/earnings per share:

 

 

 

 

 

 

 

 

Adjusted basic (loss)/earnings per share (pence)

 

(13.30

)

 

(4.42

)

 

(6.73

)

 

13.61

 

Weighted average number of ordinary shares used as the denominator in calculating adjusted basic (loss)/earnings per share (thousands)

 

162,939

 

 

164,544

 

 

162,939

 

 

164,563

 

Adjusted diluted (loss)/earnings per share:

 

 

 

 

 

 

 

 

Adjusted diluted (loss)/earnings per share (pence) (1)

 

(13.30

)

 

(4.42

)

 

(6.73

)

 

13.59

 

Weighted average number of ordinary shares and potential ordinary shares used as the denominator in calculating adjusted diluted (loss)/earnings per share (thousands) (1)

 

162,939

 

 

164,544

 

 

162,939

 

 

164,746

 

         

(1) For the three and nine months ended 31 March 2021 and the three months ended 31 March 2020, potential ordinary shares are anti-dilutive, as their inclusion in the adjusted diluted loss per share calculation would reduce the loss per share, and hence have been excluded.

4 Cash generated from operations

 

 

Three months ended

31 March

 

Nine months ended

31 March

 

 

2021

£’000

 

2020

£’000

 

2021

£’000

 

2020

£’000

(Loss)/profit for the period

 

(18,111

)

 

(22,853

)

 

15,447

 

 

13,282

 

Income tax (credit)/expense

 

(4,911

)

 

(5,701

)

 

2,627

 

 

12,438

 

(Loss)/profit before income tax

 

(23,022

)

 

(28,554

)

 

18,074

 

 

25,720

 

Adjustments for:

 

 

 

 

 

 

 

 

Depreciation

 

3,795

 

 

3,683

 

 

11,244

 

 

10,951

 

Amortization

 

30,728

 

 

32,346

 

 

94,730

 

 

95,790

 

Loss/(profit) on disposal of intangible assets

 

1,424

 

 

(4,765

)

 

(259

)

 

(16,067

)

Net finance costs/(income)

 

1,440

 

 

25,247

 

 

(18,283

)

 

18,427

 

Non-cash employee benefit expense – equity-settled share-based payments

 

491

 

 

226

 

 

2,244

 

 

591

 

Foreign exchange (gains)/losses on operating activities

 

(405

)

 

(640

)

 

769

 

 

(926

)

Reclassified from hedging reserve

 

588

 

 

3,177

 

 

176

 

 

8,988

 

Changes in working capital:

 

 

 

 

 

 

 

 

Inventories

 

429

 

 

132

 

 

(177

)

 

(273

)

Prepayments

 

4,600

 

 

2,343

 

 

(5,308

)

 

2,162

 

Contract assets – accrued revenue

 

15,516

 

 

35,398

 

 

(4,313

)

 

(3,168

)

Trade receivables

 

26,560

 

 

(14,475

)

 

89,816

 

 

(5,971

)

Other receivables

 

(1,112

)

 

493

 

 

(1,244

)

 

1,067

 

Contract liabilities – deferred revenue

 

(31,174

)

 

(42,380

)

 

(70,288

)

 

(98,698

)

Trade and other payables

 

5,796

 

 

22,102

 

 

(7,017

)

 

(22,699

)

Cash generated from operations

 

35,654

 

 

34,333

 

 

110,164

 

 

15,894

 

 

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