As stated in note 2, these are the Group’s first consolidated financial statements prepared in accordance with IFRS.
The accounting policies set out in note 2 have been applied in preparing the financial statements for the year ended 30 March 2016, the comparative information presented in these financial statements for the year ended 25 March 2015 and in the preparation of an opening IFRS balance sheet at 27 March 2014 (the Group’s date of transition).
In preparing its opening IFRS balance sheet, the Group has adjusted amounts reported previously in financial statements prepared in accordance with Irish GAAP (previous GAAP). An explanation of how the transition from previous GAAP to IFRSs has affected the Group’s financial position, financial performance and cash flows is set out in the following tables and the notes that accompany the tables.
The key adjustments on transition to IFRS relate to:
Irish GAAP | Baggot Street | AES goodwill | PowerGen goodwill | Defined benefit pension | Discontinued operations | Unsecuredloan notes | IFRS | |
Note | A | B | B | C | D | E | Total | |
€’000 | €’000 | €’000 | €’000 | €’000 | €’000 | €’000 | €’000 | |
Continuing operations | ||||||||
Revenue | 417,383 | - | - | - | - | (10,662) | - | 406,721 |
Cost of sales | (282,155) | - | - | - | - | 9,725 | - | (272,430) |
Gross profit | 135,228 | (937) | 134,291 | |||||
Other income | 500 | 500 | ||||||
Distribution and administration costs | (83,303) | (437) | 450 | (533) | - | 4,094 | - | (79,729) |
Fair value movement on investment properties | - | 14,505 | - | - | - | - | - | 14,505 |
Operating profit | 52,425 | 14,068 | 450 | (533) | 3,157 | 69,567 | ||
Net finance costs | (10,162) | - | - | - | (2,590) | - | - | (12,752) |
Share of profit of equity-accounted investees | (382) | - | - | - | - | - | - | (382) |
Profit before tax | 41,881 | 14,068 | 450 | (533) | (2,590) | 3,157 | 56,433 | |
Income tax | (6,792) | (708) | 324 | (289) | (6,417) | (13,882) | ||
Profit after tax | 35,089 | 13,360 | 450 | (533) | (2,266) | 2,868 | (6,417) | 42,551 |
Discontinued operations | ||||||||
Loss from discontinued operations | (4,637) | - | - | - | - | (2,868) | - | (7,505) |
Profit | 30,452 | 13,360 | 450 | (533) | (2,266) | - | (6,417) | 35,046 |
EBITDA | 98,085 | 14,068 | - | - | - | - | - | 112,153 |
Irish GAAP 2015 | Investment property | Goodwill | Defined benefit pension | Unsecured loan notes | IFRS 2015 | |
Note | A | B | C | E | Total | |
€’000 | €’000 | €’000 | €’000 | €’000 | €’000 | |
Profit for the year | 30,452 | 13,360 | (83) | (2,266) | (6,417) | 35,046 |
Revaluation of investment property | 14,068 | (14,068) | - | - | - | - |
Items that will never be reclassified to profit or loss | ||||||
Remeasurement of defined pension liability | (28,056) | - | - | 2,590 | - | (25,466) |
Tax on remeasurement of defined pension liability | 3,451 | - | - | (324) | - | 3,126 |
(24,606) | - | - | 2,266 | - | (22,339) | |
Items that are or may be reclassified to profit or loss | ||||||
Foreign operations – foreign currency translation differences | 596 | - | - | - | - | 596 |
Cashflow hedges – effective portion of changes in fair value | - | - | - | - | 58,599 | 58,599 |
Related tax on changes in fair value of cash flow hedges | - | - | - | - | (7,325) | (7,325) |
Cashflow hedges – reclassified to profit or loss (interest) | - | - | - | - | (2,824) | (2,824) |
Tax on cashflow hedges – reclassified to profit or loss (interest) | - | - | - | - | 353 | 353 |
Cashflow hedges – reclassified to profit or loss (foreign exchange) | - | - | - | - | (51,340) | (51,340) |
Related tax on cashflow hedges reclassified to profit or loss (foreign exchange) | - | - | - | - | 6,417 | 6,417 |
596 | - | - | - | 3,880 | 4,476 | |
Other comprehensive income, net of tax | (24,009) | - | - | 2,266 | 3,880 | (17,863) |
Total comprehensive income | 20,511 | (708) | (83) | - | (2,537) | 17,183 |
Irish GAAP | AES goodwill | PowerGen goodwill | Unsecured loan notes | IFRS presentation adjustments | IFRS | |
Note | B | B | E | Total | ||
€’000 | €’000 | €’000 | €’000 | €’000 | €’000 | |
Assets | ||||||
Joint ventures | 2,166 | - | - | - | - | 2,166 |
Property, plant and equipment | 315,654 | - | - | - | (2,947) | 312,707 |
Investment property | 9,000 | - | - | - | - | 9,000 |
Goodwill | 12,143 | (6,361) | (5,782) | - | - | - |
Other intangible assets | 17,928 | 517 | 2,185 | - | 2,947 | 23,577 |
Derivative financial instrument | - | - | - | - | - | - |
Retirement benefit asset | - | - | - | - | 3,390 | 3,390 |
Deferred tax | - | - | - | 859 | (623) | 236 |
Total non-current assets | 356,891 | (5,844) | (3,597) | 859 | 2,767 | 351,076 |
Current assets | 343,206 | - | - | - | (1,951) | 341,255 |
Total assets | 700,097 | (5,844) | (3,597) | 859 | 816 | 692,331 |
Equity | ||||||
Share capital and share premium | (84,763) | - | - | - | - | (84,763) |
Cash flow hedge reserve | - | - | - | 736 | - | 736 |
Foreign currency translation reserve | - | - | - | - | - | - |
Profit and loss account reserves | (128,140) | 5,844 | 3,840 | (754) | - | (119,210) |
Non-controlling interests | 456 | - | - | - | - | 456 |
Total equity | (212,447) | 5,844 | 3,840 | (18) | - | (202,781) |
Liabilities | ||||||
Provisions | (52,757) | - | - | - | - | (52,757) |
Retirement benefit obligations | (38,193) | - | - | - | (8,204) | (46,397) |
Grant | (10,916) | - | - | - | - | (10,916) |
Loans and borrowings | (244,790) | - | - | 6,051 | - | (238,739) |
Derivative financial instrument | - | - | - | (6,892) | - | (6,892) |
Deferred tax | (7,145) | - | (243) | - | 7,388 | - |
Current liabilities | (133,849) | - | - | - | - | (133,849) |
Total liabilities | (487,650) | - | (243) | (841) | (816) | (489,550) |
Total liabilities and equity | (700,097) | 5,844 | 3,597 | (859) | (816) | (692,331) |
Irish GAAP | AES goodwill | PowerGen goodwill | Unsecured loan notes | Baggot Street | Foreign currency | IFRS presentation adjustments | IFRS | |
Note | B | B | E | A | F | Total | ||
€’000 | €’000 | €’000 | €’000 | €’000 | €’000 | €’000 | €’000 | |
Assets | ||||||||
Joint ventures | 3,559 | - | - | - | - | - | - | 3,559 |
Property, plant and equipment | 350,866 | - | - | - | - | (9,101) | 341,765 | |
Investment property | 25,400 | - | - | - | - | - | - | 25,400 |
Goodwill | 10,741 | (5,394) | (5,347) | - | - | - | - | - |
Other intangible assets | 25,448 | - | 937 | - | - | - | 9,101 | 35,486 |
Derivative financial instrument | - | - | - | 48,882 | - | - | - | 48,882 |
Total non-current assets | 416,014 | (5,394) | (4,410) | 48,882 | - | - | - | 455,092 |
Current assets | 283,592 | - | - | - | - | - | (2,700) | 280,892 |
Total assets | 699,606 | (5,394) | (4,410) | 48,882 | - | - | (2,700) | 735,984 |
Equity | ||||||||
Share capital and share premium | (84,763) | - | - | - | - | - | - | (84,763) |
Cash flow hedge reserve | - | - | - | (3,144) | - | - | - | (3,144) |
Foreign currency translation reserve | - | - | - | - | - | (596) | - | (596) |
Revaluation reserve | (14,068) | - | - | - | 14,068 | - | - | - |
Profit and loss account reserves | (123,382) | 5,394 | 4,517 | 5,660 | (13,360) | 596 | - | (120,575) |
Non-controlling interest | 662 | - | - | - | - | 662 | ||
Total equity | (221,551) | 5,394 | 4,517 | 2,516 | 708 | - | - | (208,416) |
Liabilities | ||||||||
Provisions | (59,741) | - | - | - | - | - | - | (59,741) |
Retirement benefit obligations | (59,539) | - | - | - | - | - | (7,828) | (67,367) |
Grant | (10,293) | - | - | - | - | - | - | (10,293) |
Loans and borrowings | (204,238) | - | - | (45,288) | - | - | - | (249,526) |
Derivative financial instrument | - | - | - | - | - | - | - | - |
Deferred tax | (8,720) | - | (104) | (6,110) | (708) | - | 10,513 | (5,129) |
Current liabilities | (135,524) | - | (3) | - | - | - | 15 | (135,512) |
Total liabilities | (478,055) | - | (107) | (51,398) | (708) | - | 2,700 | (527,568) |
Total liabilities and equity | (699,606) | 5,394 | 4,410 | (48,882) | - | - | 2,700 | (735,984) |
In accordance with Irish GAAP all fair value movements on investment property are recognised in reserves. Under IFRS, these fair value movements are recognised in the income statement. In addition a deferred tax liability is recognised for potential capital gains tax. This liability was not permitted to be recognised under Irish GAAP.
The Group has restated business combinations post 2006.
The net defined benefit pension liability recognised on the balance sheet is the same under IFRS as it was under Irish GAAP. In accordance with Irish GAAP the interest income on plan assets was calculated using the expected return on plan assets. Under IFRS, the interest income on the plan assets is calculated using the liability discount rate. The lower discount rate means lower interest income recognised in the income statement. A corresponding gain is recognised in other comprehensive income to leave net liability unchanged.
In accordance with Irish GAAP detailed line by line information was provided on this discontinued operation on the face of the Income Statement. Under IFRS the results of Anua are presented in a single line item on the face of the income statement “loss on discontinued operations”. The detailed line-by-line information that was provided on the face of the income statement under Irish GAAP is presented in the notes under IFRS. This is a presentation change only and there is no change to the net loss recognised in the income statement.
In accordance with Irish GAAP, the U.S. dollar debt held was measured at the contracted rate. Under IFRS, the US dollar debt is remeasured to Euro at each reporting date using the spot foreign exchange rate at that date.
In accordance with Irish GAAP the Group’s cross currency interest rate SWAPs were not recognised on the balance sheet. On transition to IFRS these derivatives were recognised at their fair values.
The Group has decided to apply cash flow hedge accounting for the derivatives related to the unsecured loan notes.
On transition to IFRS the Group has availed of the optional exemption to reset the foreign currency translation reserve to nil. As the Group was including these reserves in retained earnings under Irish GAAP, this resulted in no adjustment on transition to IFRS.
There are no material differences between the cash flow statement presented under IFRS and the cash flow statement presented under Irish GAAP.