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Financial summary

Financial Summary
  2015 2014 Change %
Billings1 £47,632m £46,186m +3.1
Revenue £12,235m £11,529m +6.1
Net sales1 £10,524m £10,065m +4.6
Headline EBITDA2 £2,002m £1,910m +4.9
Headline operating profit2 £1,705m £1,611m +5.8
Reported operating profit £1,632m £1,507m +8.3
Headline PBIT2 £1,774m £1,681m +5.6
Net sales margin2 16.9% 16.7% +0.2*
Headline PBT2 £1,622m £1,513m +7.3
Reported PBT £1,493m £1,452m +2.8
Headline earnings2 £1,229m £1,136m +8.2
Reported earnings £1,160m £1,077m +7.7
       
Headline diluted earnings per share2,3 93.6p 84.9p +10.2
Reported diluted earnings per share3 88.4p 80.5p +9.8
Ordinary dividend per share 44.69p 38.20p +17.0
Ordinary dividend per ADR4 $3.42 $3.15 +8.6
       
Net debt at year-end £3,211m £2,275m +41.1
Average net debt5 £3,562m £3,001m +18.7
Ordinary share price at year-end 1,563.0p 1,345.0p +16.2
ADR price at year-end $114.74 $104.10 +10.2
Market capitalisation at year-end £20,237m £17,831m +13.5
       
At 14 April 2016      
Ordinary share price 1,656.0p    
ADR price $117.38
 		   
Market capitalisation £21,423m    

The financial statements have been prepared under International Financial Reporting Standards (IFRS).

1 Billings and net sales are defined in the financial glossary

2 The calculation of ‘headline’ measurements of performance (including headline EBITDA, headline operating profit, headline PBIT, net sales margin, headline PBT and headline earnings) is set out in note 31 of the financial statements PDF (1.07MB).

3 Earnings per share is calculated in note 9 of the financial statements PDF (0.58MB).

4 One American Depositary Receipt (ADR) represents five ordinary shares. These figures have been translated for convenience purposes only using the Consolidated income statement exchange rates shown on page 180 of the financial statements PDF (0.05MB). This conversion should not be construed as a representation that the pound sterling amounts actually represent, or could be converted into, US dollars at the rates indicated.

5 Average net debt is defined in the financial glossary.

* Margin points.

Revenue £m

Revenue. 2011: £10,022m, 2012: £10,373m, 2013: £11,019m, 2014: £11,529m, 2015: £12,235m.

12,235m

Reported revenue was up 6.1% at £12,235 million. On a constant currency basis, revenue was up 7.5% and, on a like-for-like basis, revenue was up 5.3%.

Net sales £m

Net sales. 2011: £9,239m, 2012: £9,515m ,2013: £10,076m, 2014: £10,065m, 2015: £10,524m.

10,524m

Reported net sales were up 4.6% at £10,524 million. On a constant currency basis, net sales were up 5.8% and, on a like-for-like basis, net sales were up 3.3%.

Headline PBIT1 £m

Headline PBIT. 2011: £1,429m, 2012: £1,531m ,2013: £1,662m, 2014: £1,681m, 2015: £1,774m.
  • Net sales margin1 %

1,774m

Headline PBIT was up 5.6% to £1,774 million. Net sales margin was up 0.2 margin points (0.4 margin points on a constant currency basis) to an industry-leading 16.9%.

Headline EBITDA1 £m

Headline EBITDA. 2011: £1,640m, 2012: £1,756m ,2013: £1,896m, 2014: £1,910m, 2015: £2,002m.

2,002m

Headline EBITDA (headline earnings before interest, taxation, depreciation and amortisation) rose by 4.9% (7.7% in constant currencies), crossing £2 billion for the first time.

Return on equity2 %

Return on equity. 2011: 12.9%, 2012: 13.6% ,2013: 14.4%, 2014: 15.0%, 2015: 16.3%.
  • Weighted average cost of capital (WACC)

16.3%

Return on equity increased to 16.3% in 2015, while the weighted average cost of capital rose to 6.7%.

Headline diluted earnings per share1 p

Headline diluted earnings per share. 2011: 67.7p, 2012: 73.4p, 2013: 80.8p, 2014: 84.9p, 2015: 93.6p.
  • Dividends per share p

93.6p

Headline diluted earnings per share were up 10.2% to 93.6p. Dividends were up 17.0% to 44.69p per share, giving a payout ratio of 47.7% compared with 45.0% in 2014.

1 The calculation of ‘headline’ measurements of performance (including headline EBITDA, headline PBIT, net sales margin and headline earnings) is shown in note 31 of the financial statements PDF (1.07MB).

2 Return on equity is headline diluted earnings per share divided by equity share owners’ funds per share.

Average net debt £m

Average net debt. 2011: £2,811m, 2012: £3,203m ,2013: £2,989m, 2014: £3,001m, 2015: £3,562m.
  • Average net debt to headline EBITDA2 ratio

3,562m

Average net debt was up at £3.6 billion in 2015, reflecting incremental spend on acquisitions, share buy-backs and dividends. The average net debt to headline EBITDA ratio increased to 1.8 times, in the middle of the Group’s target range of 1.5-2.0 times.

Debt maturity3 £m

Debt maturity. 2016: £367m, 2017: £400m ,2018: £186m, 2019: £443m, 2020: £200m, 2021: £551m, 2022: £339m, 2023: £553m, 2024: £509m, 2025+: £1,539m.

The Group continues to work to achieve continuity and flexibility of funding. Undrawn committed borrowing facilities are maintained in excess of peak net-borrowing levels and debt maturities are monitored closely.

2015 revenue by geography %

2015 revenue by geography: North America 37%, UK 14%, Western Continental Europe 20%, Asia Pacific, Latin America, Africa & Middle East and Central & Eastern Europe 29%
  • North America37
  • UK14
  • Western Continental Europe20
  • Asia Pacific, Latin America, Africa & Middle East and Central & Eastern Europe29

In 2015, 29% of the Group’s revenue came from Asia Pacific, Latin America, Africa & Middle East and Central & Eastern Europe. Our target is to increase this to 40-45% of revenues over the next five years.

2015 headline PBIT1 by geography %

2015 headline PBIT by geography. North America 41%, UK 14%, Western Continental Europe 15%, Asia Pacific, Latin America, Africa & Middle East and Central & Eastern Europe 30%
  • North America41
  • UK14
  • Western Continental Europe15
  • Asia Pacific, Latin America, Africa & Middle East and Central & Eastern Europe30

Profit growth was strongest in North America in 2015, with margins of almost 19%.

2015 revenue by sector %

2015 revenue by sector. Advertising and Media Investment Management 45%, Data Investment Management 20%, Public Relations & Public Affairs 8%, Branding & Identity, Healthcare and Specialist Communications 27%
  • Advertising and Media Investment Management45
  • Data Investment Management20
  • Public Relations & Public Affairs8
  • Branding & Identity, Healthcare and Specialist Communications27

Marketing services comprised 55% of our revenues in 2015, a little less than 2014. Revenue growth was strongest in Advertising and Media Investment Management at almost 10% in constant currencies.

2015 headline PBIT1 by sector %

2015 headline PBIT by sector. Advertising and Media Investment Management 48%, Data Investment Management 16%, Public Relations & Public Affairs 9%, Branding & Identity, Healthcare and Specialist Communications 27%
  • Advertising and Media Investment Management48
  • Data Investment Management16
  • Public Relations & Public Affairs9
  • Branding & Identity, Healthcare and Specialist Communications27

PBIT contributions were broadly in line with prior year, with Data Investment Management and Public Relations & Public Affairs showing significant margin growth.

1 The calculation of headline PBIT is set out in note 31 of the financial statements PDF (1.07MB).

2 The calculation of headline EBITDA is set out in note 31 of the financial statements PDF (1.07MB).

3 Includes corporate bonds and bank loans payable at par value, excluding any redemption premium due, by due date.