RWS Annual Report 2022 web - Flipbook - Page 42
Chief Financial Officer's Review (continued)
ADJUSTED PROFIT BEFORE TAX
BALANCE SHEET AND WORKING CAPITAL
Adjusted profit before tax ("Adj PBT") is stated before
amortisation of acquired intangibles, share-based
payment expense, acquisition costs, and exceptional
items (see reconciliation on page 160). The Group uses
adjusted results as a key performance indicator, as the
Directors believe that these provide a more consistent
and meaningful measure of the Group’s underlying
performance across financial periods. The Adj PBT of
£135.7m (Adj PBT margin: 18.1%) recorded in the period
has increased from £116.4m (Adj PBT margin: 16.8%) in
the prior year.
Net assets at 30 September 2022 increased by £130.8m
to £1,141.7m. The main driver of this increase was the
strengthening USD, increasing dollar-denominated net
assets by £119m.
TAX CHARGE
The Group’s tax charge for the year was £20.5m
(2021: £13.8m), representing an effective tax rate on
profit before tax of 24.6% compared with 25.1% in the
prior financial year. The corporate income tax rates in
the overseas countries in which the Group operates
continue to be higher than the existing UK corporate
income tax rate of 19%, which results in a higher
effective rate than the headline UK rate.
EARNINGS PER SHARE AND DIVIDEND
Basic earnings per share for the financial year increased
from 10.9p to 16.1p, an increase of 48%, while adjusted
basic earnings per share increased from 23.8p to 26.6p,
representing an increase of 12%, which reflects the after
tax impact of significant adjusting items this financial
year consequent to the acquisition of SDL. The weighted
average number of ordinary shares in issue for basic
and adjusted basic earnings increased from 378.5m to
389.4m, principally due to the proportionate impact of
the ordinary shares issued in connection with the SDL
acquisition in the prior period.
A final dividend for the financial year end 30 September
2022 of 9.5 pence per share has been proposed,
equivalent to £37.0m, while an interim dividend of 2.25
pence per share, equivalent to £8.7m, was paid during
the financial period. A comparative final dividend for the
year ended 30 September 2021 of 8.5 pence per share,
equivalent to £33.1m, was paid in this financial period.
The proposed total dividend for the year of 11.75
pence per share represents a 12% increase on the total
dividend relative to the prior financial period of 10.5
pence per share.
42
RWS — Annual Report 2022
STRATEGIC REPORT
Current assets at 30 September 2022 of £325.9m have
increased by £38.1m on the prior financial year, including
an increase in trade and other receivables of £28.7m. Cash
and cash equivalents balances of £101.2m have increased
by £8.7m.
The increase in trade and other receivables is primarily
driven by the growth of the business in the period and
includes an increase in trade receivables of £15.2m and
an increase in accrued income of £16.3m. This increase
reflects stronger revenues during the financial year, whilst
the average days’ sales outstanding (the calculation of
which measures the number of days’ billings in trade
receivables) has remained stable.
Current liabilities have also increased to £203.6m at 30
September 2022, an increase of £12.7m, primarily due
to an increase in trade and other payables balances of
£13.6m. Non-current liabilities have decreased by £14.4m,
reflecting a net reduction in loan balances under our
RCF of £17.9m, a reduction in other non-current liabilities
of £3.7m, partly offset by an increase in deferred tax
liabilities of £7.2m.
110.2%
Cash Conversion Ratio
26.6p
Adjusted EPS
9.5p
Final dividend
