Annual
Report
2023
Enter the
heart of it
Ascential takes the world’s leading brands to the heart of
what’s next for their industries. We do this through our
events, intelligence products and advisory services.
Strategic report
Governance report
Financial statements
4 Company overview
6 Chief Executive’s review
8
Investment case
10 Business model
12 Key performance indicators
14 Segmental review
15 – Marketing
19 – Financial Technology
24 Financial review
32 Risk management and principal risks
42 Our people
48 Our stakeholders
56 ESG
82 Chair’s introduction
84 Governance at a glance
86 Board of Directors
88 Governance framework
94 Audit Committee report
102 Nomination Committee report
104 Report of the
Remuneration Committee
107 Directors’ remuneration policy
115 Annual report on remuneration
126 Directors’ report
130 Independent auditor’s report
to the members of Ascential plc
138 Consolidated statement
of profit or loss
139 Consolidated statement
of comprehensive income
140 Consolidated statement
of financial position
141 Consolidated statement
of changes in equity
142 Consolidated statement
of cash flows
143 Notes to the financial statements
187 Parent Company balance sheet
188 Parent Company statement
of changes in equity
189 Notes to the Company
financial statements
195 Alternative performance measures
More information online:
Our website gives you fast, direct access
to a wide range of Company information.
ascential.com
This is an important and exciting time for Ascential. As we
look forward, we clearly see the opportunities that our newly
focussed business offers our customers to further connect,
learn and innovate, helping them succeed, shape and lead
their industries.”
Philip Thomas
Chief Executive
Financial highlights
(continuing operations)
Strategic and segmental highlights
Revenue
Organic revenue growth1
• Positioned as a premium, global, events-led business
£206.4m
13%
Adjusted EBITDA1
Organic Adjusted EBITDA
growth1
£56.4m
17%
Reported operating profit
Adjusted operating profit1
£30.7m
£51.5m
– Long-term growth strategy: opportunities, both
organically and via acquisition, for growth and returns
– Proven track record through the cycle: +8% revenue
CAGR over the last four years
– Diverse, sustainable revenue streams: spanning live
events, digital subscriptions and advisory
• Strategic actions to create value for shareholders
– Disposal of Digital Commerce and WGSN completed
post year-end: total cash proceeds of £1.2bn
– Plan to return £850m to shareholders through a
combination of tender offer, special dividend and
on-market buyback programmes
– Hudson MX sale: process underway and expected to
conclude in Q2 2024
Adjusted diluted EPS1
Adjusted EBITDA up 17% to £56.4m
• Strong organic growth: revenue up 13% to £206.4m,
5.0p
– Strong growth in Marketing segment, revenue up 22%
– Financial Technology segment revenue up 1%
Diluted EPS
1.3p
(from discontinued operations)
Loss after tax
£195.5m
1 Refer to the glossary of Alternative Performance Measures on page 195
1
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements
2
Ascential plc Annual Report 2023 Strategic
Report
4 Company overview
6 Chief Executive’s review
8
Investment case
10 Business model
12 Key performance indicators
14 Segmental review
15 – Marketing
19 – Financial Technology
24 Financial review
32 Risk management and principal risks
42 Our people
48 Our stakeholders
56 ESG
3
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Company overview
Who we are
We help the world’s leading brands navigate
what’s next through events, intelligence and
advisory. As a trusted partner, we help our
customers achieve success. We do this
through:
•
industry-leading events that offer
unique opportunities to connect,
learn, and innovate;
• data, analytics and insights platforms that
provide actionable intelligence to drive
informed strategic decisions;
• expert advisory and training that help
customers lead the way in industry trends
and best practice.
We are organised into two divisions:
Lions, serving the Marketing industry, and
Money20/20, serving the Financial Technology
industry. At the heart of each division are
tentpole events for the industries we serve,
with Cannes Lions awarding the best creative
work since 1954, and Money20/20 driving
progress in the Financial Technology industry
from 2012 onwards. Now, with our digital
intelligence products and advisory services,
we can take customers to the heart of
what’s next all year round.
Our customers
Through our two divisions we serve two distinct industries: Marketing and
Financial Technology. Our customer base spans the core industries we serve
and the broader ecosystem that exists around them.
Our Marketing division, Lions, benefits from a strong mixture of different
customers including brands, agencies, technology companies and media
platforms. Money20/20, our Financial Technology division, serves the entire
Financial Technology community, including payments, banks, technology
companies, VCs, startups and regulators, as well as merchants, retailers and
brands that have payments at their core.
Our people
We strive for the highest standards in
everything we do, for our customers, and for
our people. We work hard to attract and retain
the best people in the industry so we can
deliver our exceptional products and services.
We aim to be a destination employer in each
of our key operating territories and markets.
Group revenue
£206.4m
Countries we serve
120+
Revenue by geography1
Customers we serve
North America
Other Europe
United Kingdom
Asia Pacific
Middle East and Africa
South America
51%
18%
15%
8%
4%
4%
>8,000
Number of people
700
1 Revenue by location of customer (continuing operations)
4
Ascential plc Annual Report 2023 Our divisions
Marketing
Marketing Segmental review
Page 15
Financial Technology
What we do
In the LIONS division, LIONS, WARC, Contagious and
Acuity Pricing come together to champion creative
marketing that matters.
Lions is the destination for those in the pursuit of
creative excellence, encapsulating Cannes Lions
International Festival of Creativity, The Work,
and Lions Advisory.
WARC is the global authority on marketing
effectiveness, providing rigorous and unbiased
evidence, expertise and guidance to help marketers
navigate any challenges effectively.
Contagious is a creative and strategic intelligence firm
that helps agencies and brands supercharge their
marketing by learning from the world’s most creative
and effective companies and campaigns.
Acuity Pricing helps the UK’s largest retailers and
brands to create pricing and proposition strategies
that win market share, using real-time price,
promotion and product data.
Revenue by type
Sponsorship
Delegates
Awards
Subscriptions
Advisory
26%
20%
24%
23%
7%
What we do
Money20/20’s regional events provide a distinctive focus
on what’s next across the world of payments, fintech and
financial services.
Money20/20 is the world’s leading premium
content, sales and networking platform for the
global money ecosystem.
Launching in 2024, Twentyfold is a fintech
intelligence platform.
Revenue by type
Sponsorship
Delegates
60%
40%
Financial Technology
Segmental review
Page 19
5
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Chief Executive’s
review
This has been a pivotal year for Ascential.
In January 2023, we announced the
conclusion of our strategic review: our
decision to separate the WGSN and Digital
Commerce businesses from Ascential, with
the events-led business remaining listed on
the UK public market. It had become very
clear through the review that the three
divisions each had strong competitive
positions and growing but distinct end
markets. Nevertheless, the Board concluded,
and it was ultimately proven, that the diverse
nature of their operating models, financial
profiles and capital requirements had
suppressed shareholder value.
The sales of Digital Commerce and WGSN announced in October
2023 have given us the opportunity to return to our shareholders a
value equivalent to almost 90% of Ascential’s market capitalisation
prior to the announcement date and our shareholders now own a
business that has our world-leading events firmly at its heart and
sole focus.
I am fortunate enough to experience the energy of our global
team every day, and as we start this next chapter, I am happy to
see our teams galvanised and energised by our new streamlined
focus as an events-led business. I would like to take this
opportunity to thank all our people for working so hard during
these last months that have been dominated by change. I continue
to be impressed by the focus and dedication of our teams, in
particular those who were directly involved in delivering the
outcome of the strategic review, and including some who have
now left or are shortly to leave the business.
We are a business focussed on dynamic, growing, global markets
where disruption creates clear opportunities: Marketing and
Financial Technology. Our events are distinct, sitting at the heart of
the industries they bring together, and so attracting commercial
participation from both attendees and corporate partners across a
wide range of revenue channels. As we look ahead, we see clear
opportunities for growth, both through the proven organic levers
that have driven revenue successfully for many years and through
expansion deeper into our existing markets, and into similarly
disrupted, multifaceted industries.
6
Philip Thomas
Chief Executive
Revenue
£206.4m
Adjusted EBITDA
£56.4m
We have many opportunities
to strengthen the position of
our global events – events
which are truly distinctive, and
which play an important role in
the industries they serve.”
Ascential plc Annual Report 2023 2023 performance
Our operational execution in the year has been strong, with overall
revenue growth of 13% and Adjusted EBITDA growth of 17% (on a
continuing, organic basis), as our events continue to outstrip their
2019 pre-Covid benchmark levels of performance.
Our Marketing segment grew revenue by 22%, with the Cannes
Lions Festival of Creativity, in particular, growing strongly. This was
a performance led by outstanding record levels of sponsorship
engagement from global businesses who clearly see the value the
event can deliver for them. There was good growth across all other
revenue lines, including the awards benchmark (which saw the
successful launch of the Entertainment Lion for Gaming), delegate
revenues (with attendees reaching c.12,000) and from our
subscription and advisory revenue streams. In August we acquired
Contagious, a creative insights business serving our Marketing
customer set, through event, subscription and advisory revenues,
for which integration and the realisation of revenue synergies is
progressing well.
Our Financial Technology segment grew revenue by 1% overall.
Money20/20 Europe saw very strong growth of 19%, driven by the
expansion of both delegate and sponsorship revenue streams. This
was offset by an 8% drop in revenue from the US event, following
growth of over 60% in 2022, with delegate numbers impacted by
a steep decline of the early-stage funding environment impacting
our customers. Despite this decline, Money20/20 US in 2023 was
still 50% larger than its pre-Covid 2019 edition.
Throughout 2023 we owned the Digital Commerce and Product
Design businesses which, following their sales agreed in October
2023, have now been treated as discontinued operations in these
financial statements. Furthermore, as part of the arrangements
for the ongoing disposal of Hudson MX, we acquired accounting
control of that business and consolidated their results from
October 2023, with that business also treated as a discontinued
operation. Consolidated revenue and Adjusted EBITDA from these
discontinued operations was £380m and £66m respectively with
Digital Commerce delivering a 20% growth in revenue and Product
Design a 7% growth in revenue. In 2023 these discontinued
operations delivered a loss after tax of £195.5m driven by the costs
of the strategic review and the disposal processes to optimise
shareholder value (and driving of a net cash inflow of £1.2 billion
and a profit of approximately £0.5bn to be recognised in 2024)
as well as the revaluation of our investment in Hudson.
Operating responsibly
The main focus for our ESG work in 2023 was environment
and climate change resilience, with a particular focus on carbon
emissions data collection. I am pleased to report that this year, for
the first time, we have measured our carbon footprint across our
events portfolio including data from all of the scope 1 - 3 categories,
and implemented a new carbon measurement tool and
methodology for Ascential’s carbon emissions. We also maintained
our strong position across a range of ESG indexes and developed
a revised Sustainability Strategy for the restructured business.
This is outlined in more detail in our ESG report from page 56.
In line with our ambition to become one of the industry’s most
sustainable events-led businesses, we strive to mitigate any
negative impact on the environment, community and society
in which we operate, and to ensure the conditions in which our
business can thrive. In my new role as ESG Board Sponsor,
I will oversee and champion this new strategy, establishing
governance and empowering the leadership team to identify
and manage ESG risks and opportunities.
2024 priorities
In our first full year as a standalone events-led business,
we have three key priorities:
Return of value to shareholders
• returning £850m to shareholders through a combination
of tender offer, special dividend and on-market share
buyback programmes.
Hudson MX sale
• concluding the sale process which is underway.
Delivering our medium-term growth targets and ambitions
• expanding our addressable market in Marketing and
Financial Technology – both of which benefit from
long-term structural growth drivers – as a focussed,
premium, events-led business.
Outlook
This is an important and exciting time for Ascential. As we look
forward we clearly see the opportunities that our newly focussed
business offers our customers to further connect, learn and
innovate, helping them succeed, shape and lead their industries.
We have many opportunities to strengthen the position of our
global events – events which are truly distinctive, and which play
an important role in the industries they serve. We have the
opportunity to build on the diversity of our revenue streams and
continue to innovate and grow our digital propositions, across both
our divisions. Ascential has events at its heart – but our digital
products and advisory services are what enable us to deepen our
relationships with customers and ultimately serve them better.
That balance is crucial for our success as a company.
In 2024 our focus in the early part of the year is for a successful
launch of Money20/20 Asia in April, where preparations continue
to go well. We continue to see positive customer engagement,
with booking levels for our events tracking in line with prior year
indicators overall. Notwithstanding ongoing disruption to the
Fintech funding environment, we are excited by the continued
expansion of our end market and global footprint through the
launch of Money20/20 Asia. This continuing momentum, following
on from our strong post-pandemic bounce back, supports our
confidence in our medium-term growth targets and ambitions.
Philip Thomas
Chief Executive
25 March 2024
7
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Investment
case
1Large and fast-
growing addressable
markets
The global markets in which we operate
provide clear opportunities for continued
growth across our business.
The Marketing industry is forecast to
maintain robust levels of growth in the
medium term at 6% CAGR1 supported by
structural trends such as the growing
importance of direct-to-consumer
relationships, the increasing appeal of shared
live experiences in sports and entertainment,
as well as the clear opportunities for greater
scaling and reach offered by generative AI.
The Financial Technology industry,
following a period of robust growth,
currently operates within a challenging
landscape shaped by higher interest
rates and inflation, and their impact on
investment decisions. Nevertheless,
the ongoing technological revolution
continues to create additional avenues
for value creation in the sector, suggesting
that the industry’s medium-term growth,
currently estimated at 15% CAGR to
20282 , is set to continue to outstrip that
of its traditional banking counterpart.
2Market-leading
businesses
We set the benchmark for product quality
and are regarded as market leaders in our
industries. We serve over 80% of the
world’s most valuable brands.
Our brands are number one in their
industries by a considerable margin. This
strong position enables us to bring new
ideas to market more quickly, as well as
providing clear pricing growth options.
1 Group M, This Year, Next Year, December 2023
McKinsey & Co., Fintechs: A new paradigm of
2
growth, October 2023
Kantar BrandZ, 2023 most
valuable global brands
85%
of the Top 20
3Significant
competitive moats
Our market leadership is underpinned by significant competitive moats, which reinforce
our competitive advantage and create high barriers for new entrants:
World class, scalable platforms
• We have established wide-reaching
event platforms, which we continue to
develop, providing our customers with
unrivalled access to key industry content
and deal-making opportunities that
generate a powerful network effect.
Global coverage
• We serve over 8,000 customers,
in over 120 countries across
five continents
Leading Market Expertise
• Our teams are recognised and
valued as the leading experts in their
industries, excelling in innovation,
market insights and event delivery.
8
Ascential plc Annual Report 2023 4Diverse revenue
streams
2023 Revenue by type
We have a diverse mix of revenue streams,
which is particularly notable in an
events-led business.
Our revenue mix is distributed
between event driven and non-event
driven revenues, which account for
over a third of all revenues.
Event Revenue
Sponsorship
Delegates
Non-Event Revenue
Subscriptions
Benchmark Awards
Advisory
38%
28%
15%
15%
4%
5Multiple levers for
revenue growth
We have many levers to organic growth at our disposal:
Organic
•
Penetration of existing markets
Other
• Bolt-on acquisitions
• Expansion into new geographies
• Opportunities in new markets
• Growth in higher value-add products
• Product innovation
6Highly attractive
financial profile
We have delivered a strong financial
performance over the past 10 years,
with annual compound revenue growth
of 8% and Adjusted EBITDA growth of
6% since 2019, looking through the
pandemic period.
This has been achieved through a
rigorous focus on the strength of our
world-leading events.
Revenue and Adjusted EBITDA*
£m
250
200
150
100
50
0
CAGR: 8%
CAGR: 6%
12 13 14 15 16 17
18 19 20 21 22 23
Revenue
EBITDA
*
including the pro forma results of
acquisitions and disposals to date
9
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023
Business
model
What we do
Ascential provides
customers with
event-led products
and services, creating
value for stakeholders
underpinned by:
1. Market-leading brands
• Our brands are at the heart of the
industries they serve.
2. Global ecosystems
• We serve large and growing Marketing
and Financial Technology sectors.
3. Diverse revenue streams
• We generate diverse revenue
streams from events, intelligence
and advisory services.
4. Global workforce
• We have a global workforce of around
700 people.
5. Sustainability
• We have a sustainable and responsible
focus to our business.
Four key value streams
Multiple customer touch
points, building upon our
events platform.
Events
Insight
Events
Advisory
Insight
Events
Benchmark
Benchmark
Benchmark
Benchmark
Benchmarking awards
Awards benchmark
for industry excellence.
Events
Delivering premium global events
that sit at the heart of their industry
and fuel connection, business
and learning.
Revenue
£31m
Revenue
£136m
Proportion of revenue
Proportion of Revenue
15%
66%
10
Ascential plc Annual Report 2023 Events
Insight
Events
Advisory
Insight
Events
Benchmark
Benchmark
Benchmark
Benchmark
Subscriptions
Setting the bar through benchmarking
and unlocking data and insight to raise it,
accessed through subscriptions.
Advisory
Providing expert advisory services
to create the conditions for creative
transformation and maximum
marketing effectiveness.
Revenue
£30m
Revenue
£9m
Proportion of revenue
Proportion of revenue
15%
4%
Our value
We have aligned
our business to best
serve the needs of
our stakeholders,
ensuring that we are
uniquely positioned
to deliver value.
1. For our shareholders
• We aim to deliver long-term
sustainable returns, measured
by Total Shareholder Return.
2. For our customers
• We take our customers to the
heart of their industries to enable
them to do business, network
and learn.
• We track our performance
through a range of customer
engagement statistics including
net promoter scores, retention
rates and growth from
existing customers.
3. For our colleagues
• We are a destination employer for
global talent, with hubs in London,
New York and Singapore.
• We measure the engagement of
our people through survey data,
tracked at regular points
throughout the year.
4. For our communities
• We are focussed on maintaining
a sustainable business model and
making a positive impact on the
communities in which we operate.
More information
Pages 48 to 55
11
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 KPIs
Key Performance
Indicators (KPIs)
are used to measure
both the progress and
success of our strategy
implementation.
The KPIs are set out below, with a measure of our
performance to date. Adjusted profit measures are
used to assist readers in understanding underlying
operational performance. These measures exclude
income statement items arising from portfolio
investment and divestment decisions, and from
changes to capital structure.
Financial Review
Risks
Page 24
Page 32
Revenue
£206.4m
Organic Revenue Growth1
+13%
2023
2022
£206.4m
£191.2m
2023 +13%
2022
+70%
Description
Revenue generated from continuing business operations.
Description
Change in revenue from continuing operations
on a like-for-like basis.
Performance in 2023
Growth of +13% reflects, primarily, the strong performance of
the Marketing segment.
Performance in 2023
See Revenue.
12
Ascential plc Annual Report 2023 Adjusted EBITDA1
Organic Adjusted EBITDA Growth1
£56.4m
+17%
2023
2022
£56.4m
£49.9m
2023
17%
2022
83%
Description
Adjusted operating profit, from continuing operations,
excluding depreciation and amortisation.
Description
Change in adjusted operating profit, from continuing
operations, excluding depreciation and amortisation,
on a like-for-like basis.
Performance in 2023
Growth of +17% reflects revenue growth, together
with the return of the Marketing segment profitability
towards pre-pandemic levels.
Performance in 2023
See Adjusted EBITDA
Operating cash conversion1
Free cash flow conversion1
112%
2023
2022
96%
112%
114%
2023
2022
96%
107%
Description
Adjusted cash generated from continuing operations
expressed as a percentage of Adjusted EBITDA.
Description
Net cash generated from operating activities including
capital expenditure expressed as a percentage of
Adjusted EBITDA.
Performance in 2023
Favourable working capital movements increased the
cashflow generated from operations compared to EBITDA.
Performance in 2023
Capital expenditure and tax payments offset the impact of
favourable working capital movements on the cashflow
generated from operations compared to EBITDA.
1 Refer to the glossary of Alternative Performance Measures page 195
13
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements 14
Ascential plc Annual Report 2023 Marketing
The Marketing segment comprises
Lions and WARC, Contagious and Acuity.
Lions, through its awards and festival, as
well as its subscription and advisory
products, is the global benchmark for
creativity in the branded communications
industry. WARC is the global authority on
marketing effectiveness for brands, agencies
and media platforms. In August 2023, we
acquired Contagious, a provider of creative
trends insights to brands and agencies. The
Marketing segment now also includes Acuity
which was transferred from the Financial
Technology segment in 2023.
Revenue
£130.5m
Organic revenue growth
22%
Revenue streams by business (%)
Cannes Lions
WARC
Acuity Pricing
Contagious
78%
17%
3%
2%
Revenue
Adjusted EBITDA
Adjusted EBITDA margin
Our Marketing segment empowers marketing professionals
with the tools, insights and data to advocate for prioritising capital
allocation towards marketing, especially creative marketing. We’re
confident this approach fuels growth and provides our customers
with a measurable competitive advantage.
The Marketing segment performed very strongly in 2023. Organic
revenue growth of 22% in the year was especially notable given that
Lions had already returned to pre-COVID levels of revenue in 2022.
We were also pleased to see Adjusted EBITDA growth of 37% with
margins growing to 43% despite the increasing proportion of lower
margin sponsorship revenue.
Lions provides opportunities to network, learn and do business at
the Cannes Lions International Festival of Creativity. The festival
celebrated its 70th edition in Cannes in June 2023, growing very
strongly compared to 2022. The event enjoyed record levels of
customer engagement, through physical sponsorship activations,
up 68%, as demand for onsite activations, particularly with major
media and technology partners, grew strongly even compared to
2022’s record levels. Overall, we welcomed 110 sponsorship
customers with an average order value of £260,000.
The other major event revenue stream, revenue from delegate
participation, was up 17%. Attendee volumes at Cannes Lions saw
good growth, with more than 12,000 attendees representing
growth of 9% on the 2022 event. Asia Pacific attendees grew by
over 30%, with delegates now able to travel outside their countries
due to the lifting of pandemic restrictions.
In terms of the Lions benchmark awards, entry volumes were
just under 27,000, up 6% on the prior year. This included an 18%
increase in submissions directly from brand customers, with strong
engagement in categories representing emerging channels such
as B2B, Gaming, Commerce and Business Transformation. This
year also saw the launch of the Entertainment Lion for Gaming,
where strong participation highlighted the increased collaboration
between brands and this significant industry. Lions’ regional awards
(Dubai Lynx, Spikes and Eurobest) also saw overall growth in
revenue, demonstrating the importance of the Middle East and
Asian markets within the industry.
Overall, subscriptions and advisory services accounted for around
30% of Marketing’s revenue base in 2023. Subscriptions grew by 5%,
as WARC, the largest subscription product saw good growth, with
renewal rates continuing to exceed 95%, building on the launch of
the Marketing Effectiveness Platform last year. June also saw the
launch, at the Lions Festival, of the Lions & WARC Creative Impact
track, a joint content stream, examining what it takes to drive
business performance through commercial creativity in 2023. Lions
subscription products also continued to grow well, with annual
renewal rates for the latter remaining strong, at over 90%.
Year ended 31 December (£m)
Growth (%)
2023
130.5
55.6
43%
2022
99.2
40.1
40%
Reported
Organic
32%
39%
22%
37%
15
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Marketing continued
The Retail Price & Promotion business, Acuity Pricing, was
transferred to Marketing from the Financial Technology segment
in 2023. The subscription-based business saw a slight decline in
revenue, although billings grew modestly, supported by product
enhancements and renewed marketing efforts including a
rebranding to “Acuity”.
Advisory services, which include insights using Lions’ awards
intelligence and respected creative excellence training
programmes, grew by 36% vs 2022, with projects for major
brands such as Colgate, Pepsi, Heineken and Instacart.
Acquired in August, Contagious, a multi-format creative insights
business, brings to the Marketing segment deep expertise in the
analysis of creative trends. The business, which provides forward-
looking creative inspiration and trend analysis for agency and brand
customers, is highly complementary to the offerings of Lions and
WARC and further strengthens our product set across the industry.
Contagious saw good revenue growth of 6% in 2023.
Current market conditions
The advertising industry continues to evolve, with the disruption
of media planning by new platform tools from Alphabet and Meta,
and the rise of AI, as generative AI platforms are beginning to
disrupt workflows within marketing services agencies. Digital
advertising continues to grow, in particular emerging categories
such as retail media and connected TV.
Market outlook
Our industry experts at WARC point to several key trends that will
shape the Marketing industry over the coming year.
Firstly, the digital media landscape is set to maintain strong growth,
driven by increased digital media consumption and e-commerce
expansion. Global digital ad spend is forecasted to grow by 10.3%
in 2024 to reach $770 billion. While traditional display growth slows,
emerging digital categories like connected TV and retail media will
continue to show rapid expansion, growing 12.1% and 10.5%
respectively over 2024. Social spend is expected to grow by a 12.8%
CAGR, driven by new platforms and short-form video content.1
Secondly, the rise of addressable media. Advertisers are leveraging
addressable media, characterised by data-driven, technology-
enabled, and real-time measurable campaigns. The growth in
spaces like retail media, connected TV, and programmatic reflects
this trend.
Thirdly, linear TV ad spend, the third biggest advertising category
(after social and search), which declined 5.4% p.a. over 2022 and
2023, will improve somewhat, growing 3.5% in 2024, on the back of
political spending to coincide with elections in many markets, and
sporting events such as the Olympics. Other areas to watch include
the impact of AI on search, a focus on carbon efficiency in media
consumption, and the scaling challenges and operation
considerations of retail media.
1 WARC, Global Ad Spend Outlook 2023/24
Case study
Unlocking
the city of
Cannes
Our work with LIONS has proven
to be truly strategic, has driven
tangible results for our businesses
and fostered mutual success. In
2023, our partnership reached new
heights with the Carlton rooftop
takeover, where together we
brought a unique space to the
festival including learning programs,
thought leadership, exclusive
events and networking for B2B
professionals. Together, we
are shaping the future of B2B
innovation and creativity, and we
are excited for what lies ahead.”
Keith Browning
Director, Global Brand Marketing, LinkedIn
16
Ascential plc Annual Report 2023 Case study
Collaborating with Cannes
Lions has been a transformative
journey. All initiatives conducted
at the Carlton Cannes, notably
our Penthouse rooftop takeover,
exemplified the power of
partnership, where creativity,
innovation, and strategic vision
converged to deliver an
unparalleled experience.”
Matthias Kaesweber
Director of Sales and Marketing,
Carlton Cannes
Objective
In the lead-up to the 2023 festival, the Cannes Lions team
focussed on deepening relationships with partners and sponsors
to ultimately drive value and growth. This included our
partnerships that activate on the “fringe” of the festival: the
physical footprint of the festival beyond the Palais.
2022 had been a strong year for Cannes Lions, with record
sponsorship activity. Amazon came on board as a partner,
launching their now iconic activation the Amazon Port, which
transformed the marina car park into a fully branded space,
complete with a pool and multiple stages.
Our ambition for 2023 was to grow partnership revenues through
innovation, ensuring that we were part of the conversation
between venues and partners and so able to offer unique
activations and a higher-value experience for our customers.
Solution
We focussed on deepening our relationships with the City of
Cannes and its venues to enable us to deliver better value and
better experiences. We worked closely with the Cannes Mayor’s
office, hotel partners and independent venues to unlock new
inventory and find new and creative uses for spaces that fulfilled
an unmet need.
The Carlton Hotel, built in 1913, was undergoing an extensive
refurbishment to expand the hotel significantly. Following a period
of closure for the hotel, Cannes Lions partnered exclusively with
The Carlton prior to the 2022 festival to jointly envisage how the
newly built hotel spaces could be used to house unique partner
headquarters during the festival week. In response, our partners
rose to the creative challenge and built some of the most unique
HQs to date: from a penthouse B2B stage with LinkedIn, to the
TikTok Creator House in the Carlton Gardens, to the Pinterest
‘Manifestival’ on the Carlton Beach. The Carlton team worked
tirelessly to bring these activations to life, providing four
partners with premium and first-of-their-kind activations for
the 2023 festival.
In order to bring new brands to the festival, and new
experiences to our delegate audience, we also built deeper,
strategic relationships with beach owners and the Cannes
Mayor’s office, delivering new beach activations for a number
of high-profile customers.
In short, we successfully demonstrated that, by working through
Cannes Lions exclusively, our customers were able to engage
fully with the festival experience and deliver activations – and
ultimately business outcomes – that they simply couldn’t
achieve on their own.
Outcome
In 2023, LIONS Sponsorship revenues grew by more than 60%
(vs 2022) driven by a combination of new inventory and
increases in average order value and customer volume.
There remains substantial headroom for continued innovative
new spaces in Cannes. For 2024 we are continuing our strategy
of unlocking new venues to ensure future growth. That
includes building partnerships with existing venues, as well as
creating new venues and spaces to offer to our customers,
including a number of new spaces for 2024. This will ensure we
can continue to enable our customers to achieve their business
outcomes through long-term partnership with Cannes Lions.
17
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements 18
Ascential plc Annual Report 2023 Financial
Technology
The payments ecosystem has grown
increasingly complex due to technology
and regulation, challenging organisations
that move money globally at scale.
Money20/20 helps customers navigate
this by offering access to a diverse
ecosystem where businesses can buy
and sell products, form partnerships,
and showcase their brands on a unified
platform. In 2023, Acuity was transferred
to the Marketing segment.
Revenue
£75.9m
Organic revenue growth
1%
Revenue streams by business (%)
Money20/20 US
Money20/20 Europe
62%
38%
Organic revenue growth of 1% in the year reflects the very
strong performance of Money20/20 Europe, with growth of 19%,
combined with an 8% decline in revenue from the larger US event,
which faced significant headwinds from the reduction in global
Fintech spending (down 50% in 2023 to $39.2bn). Adjusted EBITDA
reduced by £4.9m, reflecting the investment in the launch of
Money20/20 Asia and TwentyFold, the strengthening of Pounds
Sterling versus the US Dollar relative to 2022 levels and the decline
in the US edition.
Money20/20 is the leading platform for the global Fintech
community, driving progress, growth and success for customers,
by creating connections, enabling deals and generating fresh
insights. The brand’s European event, held in Amsterdam in June
2023, delivered growth of 19% compared to the 2022 edition (and
55% compared to 2019), driven by increases in both attendees
(now over 8,500), where revenue grew 11% and sponsorship
business where revenue grew 23%. The event saw attendees from
over 2,300 companies attend, representing over 100 countries,
with over 18,000 customer meetings booked via the Money20/20
app (an increase of over 20%). An increase in the Net Promoter
Score illustrates continued strong customer engagement.
The flagship US show, following its exceptional growth in 2022
(where revenue was up over 60% vs 2019), saw the impact of
disruption to the funding environment for the early-stage financial
technology sector, in particular payments, which impacted our
customer behaviour. The 2023 edition, held in Las Vegas in
October, saw revenue decline by 8%, driven by lower delegate
volumes, with attendees of over 11,500 and more than 3,200
companies participating. As with the European edition, an increase
in the Net Promoter Score for the US edition illustrates continued
strong customer engagement, combined with sponsorship
average order value that grew by 20%, while revenue for the US
event, despite being lower than in 2022, nevertheless stood 50%
higher than the 2019 pre-Covid benchmark.
Preparations for the launch of the Asian show, in Bangkok in
April 2024 continue to progress well, with good engagement
from key regional players and a compelling programme of content.
Over 200 speakers, representing banks, payment companies and
other industry leaders from across the region, will explore how
integration, regulation and technology are transforming the Asian
Fintech landscape.
Revenue
Adjusted EBITDA
Adjusted EBITDA Margin
Year ended 31 December (£m)
Growth (%)
2023
75.9
26.7
35%
2022*
92.0
31.6
34%
Reported
Organic
(18%)
(15%)
1%
(7%)
*
2022 results include £7.4m of revenue and £0.1m EBITDA loss from Retail Week World Retail Congress which was sold in December 2022 and £4.6m of revenue (nil profit) from Acuity,
which was transferred to the Marketing segment in 2023.
19
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Financial Technology continued
In October 2023, we announced the launch, in early 2024,
of TwentyFold, a new digital intelligence subscription product.
This product helps Fintech professionals find the ideal investment
and partnership opportunities, through its extensive set of market
connections and data. The product is available via annual
subscription, designed to help members optimise their deal and
partnership sourcing, reducing the overall cycle time and cost.
This is a long-term investment for the brand, and is not expected
to deliver significant revenues in 2024.
Following a period of robust growth, the Fintech industry,
in common with all tech sectors, currently operates within a
challenging landscape shaped by higher interest rates and inflation,
and their impact on investment decisions. Recently, this has seen
some significant reductions in funding and valuations of
companies in certain sub-segments of the customer base from
their 2021 highs. Nevertheless, the ongoing technological
revolution continues to create additional avenues for value creation
in the sector, which, combined with some early indications of
renewed investor confidence, suggest that the Fintech industry’s
growth is set to continue to outstrip that of its traditional banking
counterpart in the medium term.
Current market conditions
2023 represented a low point in terms of the financial services
M&A deal-making, with the market depressed by macroeconomic
factors such as high inflation, rising interest rates and lower
economic growth projections. Data from PwC, for example, shows
global deal-making in the sector during 2023 was down 12% by
volume and 40% by value from 2022, while EY analysis indicates
UK deal activity during 2023 was at a nine-year low. However,
while macroeconomic conditions and geopolitical tensions remain
challenging, improvements in financial markets, supported by
positive signals the central banks may soon lower interest rates,
is slowly translating to a rise of investor confidence.
The financial technology (fintech) sector has undergone its own
significant transformations. Technological advancements and
innovation have propelled fintech to the forefront of financial
services, adapting to the rapidly changing landscape shaped
by factors such as the evolving banking sector, accelerated
digitisation, shifting customer preferences, and regulatory support.
As of January 2024, publicly traded fintechs had a market
capitalisation of $650 billion, while the fintech unicorn landscape
has expanded to 300 companies, collectively valued at $1.2 trillion,
a six-fold increase over five years.
Looking ahead, the fintech industry confronts a challenging yet
opportunity-rich landscape shaped by evolving market dynamics.
Investors are adapting to a new financial paradigm marked by
higher interest rates and inflation, influencing their risk and reward
evaluations. Simultaneously, an ongoing technology revolution,
is creating additional avenues for value creation. According to
research from McKinsey1 , the fintech industry is poised for nearly
three times faster revenue growth than its traditional banking
counterpart from 2022 to 2028. While traditional banking
anticipates a six percent annual revenue growth, fintechs could
experience a robust 15 percent annual revenue growth over the
next five years.
Future trends
These trends align with and, in many cases, drive the maturation
of the fintech sector. McKinsey research identifies three
overarching themes that will define the forthcoming phase of
fintech growth. Firstly, fintechs will continue benefiting from the
radical transformation of the banking industry, rapid digital
adoption, and the expanding landscape of e-commerce globally,
particularly in developing economies. Secondly, despite short-term
challenges, fintechs possess untapped potential for further growth
within an expanding financial services ecosystem. Lastly, not all
fintechs are equally affected by the current market correction;
those in specific verticals and at particular stages of growth
demonstrate greater resilience compared to their counterparts.
1 McKinsey & Co., Fintechs: A new paradigm of growth, October 2023
20
Ascential plc Annual Report 2023 Case study
Smart Money
Moves
We chose Money20/20 to
launch Convera’s new brand
proposition because of the power
of the Money20/20 platform and
the quality of attendees. Our
multi-channel approach to brand
activation at Money20/20 – via
content, branded spaces and
media engagement – gave us
unparalleled reach and awareness.”
Jennifer Parker
Chief Commercial Officer, Convera
Objective
Convera is a global B2B payments company with more than
30,000 customers and a financial network spanning more
than 200 countries and territories. Formerly a part of Western
Union (a long-time partner of Money20/20) and now operating
as a standalone business, Convera needed to launch their new
brand quickly: they had the scale but lacked brand recognition.
Solution
As the world’s fintech platform for companies to grow their
brands, Money20/20 provided the perfect place for Convera
to launch their new proposition and brand in 2023. Convera’s
global partnership with Money20/20 focussed on delivering
clear business outcomes, with the primary goal of enhanced
brand awareness through thought leadership, access to
media, and beyond. Money20/20 was able to deliver this for
Convera as our platform brings together the entire collective
ecosystem of fintech, attracting senior industry executives
and offering our customers hugely valuable opportunities to
interact with media and gain press exposure.
The Convera Money20/20 partnership started in Amsterdam,
in June 2023, where Convera focussed on establishing brand
equity in the industry through a combination of activations.
The Convera lounge was open to all delegates and also
housed a podcast booth where they launched their Currency
Convos podcast (now called Converge), which brings
traditional banking and legacy payments providers together
with fintech disruptors to challenge the narrative (and each
other) on the future of finance. The podcast featured experts
from the space including the Money20/20 content team, with
ten episodes recorded on-site in Amsterdam. Convera then
used our platform to promote their Future of Trade and B2B
Payments report, ranging from government policies shaping
commerce to five-year trade forecasts and expected payment
trends. For maximum exposure, Convera took part in an
invite-only, live press conference with Europe’s top financial
media to cement their brand story at scale resulting in +212%
increase in media engagement and coverage month on month.
Building off of the brand equity established in Amsterdam, our
partnership extended to Las Vegas, where the show provided a
platform to build on the brand activation in Europe and add in
key thought leadership through content. Convera established
their presence on Sunday night, taking over a restaurant in
MoneyRow – a new sponsored space for 2023 – to host VIPs
and be officially included in our opening night kick-off. This
activation provided a foundation of increased brand awareness
and a solid foundation for the content that followed throughout
the show. Convera also sponsored Money20/20’s Converge
stage as an exclusive partner, further establishing brand
credibility by association with our editorial content and providing
a central hub for the team to take meetings. Members of
Convera’s senior leadership team joined different discussions
on stage on topics such as cloud ecosystems and infrastructure,
including Convera’s Chief Technology Officer, Chief
Commercial Officer and Chief Operating Officer. Convera
scanned 2,000+ attendees from over 1,000 companies
demonstrating a strong interest in the quality of the stage
content. For continuity, they continued with their “Smart Money
Moves” theme and key messaging, having previously launched
this in Amsterdam.
Outcome
Convera saw a strong result following engagement with
Money20/20 in 2023, running over 200 meetings with customers
and partners and generating over 1,000 new leads. They are
planning to replicate and expand on activations at both shows for
2024, including a similar lounge and an additional Partner stage
sponsorship opportunity at our US show.
21
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements The power of connection
The power of connection
22
Ascential plc Annual Report 2023 The power of connection
The power of connection
23
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Financial
review
Mandy Gradden
Chief Financial Officer
The Company benefits from
diverse revenue streams across
its two segments ranging from
digital subscriptions to live events
to advisory. Most of these revenue
streams have recurring or repeat
characteristics benefitting from our
focus on customer retention. 34%
of revenue (2022: 34%) was derived
from non-events sources, namely our
Benchmarking Awards, Subscriptions
and Advisory service lines.”
Overview
Following the agreement to sell the Digital Commerce and WGSN
businesses during 2023 and the expected sale of Hudson in the
first half of 2024, our financial results for 2023 and 2022 have
been restated to classify these three businesses as discontinued
operations. The commentary within this report is therefore
mainly focussed upon our continuing operations.
Our consolidated statement of profit or loss from continuing
operations shows revenue of £206.4m (2022: £191.2m) and an
operating profit of £30.7m (2022: £27.2m profit). Adjusted EBITDA
from continuing operations was £56.4m (2022: £49.9m) with the
growth primarily driven by the very strong performance of the
Marketing segment in which the Cannes Lions festival in particular
grew revenue by 30% versus 2022 as a result of across-the-board
increases in delegates, sponsorship and awards.
Adjusting items in 2023 included the amortisation of acquired
intangibles, share-based payments and other Non-trading items as
set out in more detail below. The sale of the Digital Commerce and
WGSN businesses completed shortly after the year end for total
net cash proceeds of £1.2bn, delivering an anticipated profit on
disposal in the 2024 financial year of approximately £500m subject
to finalisation of customary completion mechanics with the buyers.
We delivered strong operating cash flow performance for the year
in the continuing business with Adjusted cash generated from
operations of £62.9m (2022: £56.9m), an operating cash flow
conversion of 112% (2022: 114%) and a free cash flow conversion
of 96% (2022: 107%).
Alternative Performance Measures
A core KPI and strategic goal of the Company is Organic revenue
growth rate. We believe that this is the most efficient method of
growth, measures the underlying health of the business and is a
key driver of shareholder value creation. Organic revenue growth
rate eliminates the impact of acquisitions and disposals and that
element of growth which is driven by changes in foreign
exchange rates.
Adjusted EBITDA is also an Alternative Performance Measure
and is used in the day-to-day management of the business to aid
comparisons with peer companies, manage banking covenants
and provide a reference point for assessing our operational cash
generation. It eliminates items arising from portfolio investment and
divestment decisions, and from changes to capital structure. Such
items arise from non-trading activities, intermittent or non-recurring
events, and while they may generate substantial income statement
amounts, do not relate to the ongoing operational performance
that underpins long-term value generation.
Further details on Alternative Performance Measures are set out
at the end of this annual report.
24
Ascential plc Annual Report 2023 Continuing operations
The results for the year ended 31 December 2023 are summarised in the table below.
£’m
Revenue
Adjusted EBITDA
Operating profit
Adjusted operating profit
1 Restated for discontinued operations.
Segmental results
2023
206.4
56.4
30.7
51.5
2022 ¹
191.2
49.9
27.2
45.3
Growth rate
Reported
Organic
8%
13%
13%
14%
13%
17%
21%
18%
Following the announcement of the sales of the Digital Commerce and WGSN businesses, and the determination that these, along with
Hudson, were discontinued and held for sale, the Group has two continuing reportable segments. These are Marketing and Financial
Technology. Information regarding the results, growth rates and margins of each is included below.
£’m
2023
Revenue
Organic growth
Adjusted EBITDA
Organic growth
Adjusted EBITDA margin
Depreciation and software amortisation
Adjusted operating profit
2022 ¹
Revenue
Adjusted EBITDA
Depreciation and software amortisation
Adjusted operating profit
1 Restated for discontinued operations.
Corporate Costs
Marketing
Financial
Technology
Subtotal
Corporate
costs
Continuing
operations
130.5
22%
55.6
37%
43%
(2.8)
52.8
99.2
40.1
(2.6)
37.5
75.9
1%
26.7
(7%)
35%
(0.1)
26.6
92.0
31.6
(0.9)
30.7
206.4
13%
82.3
19%
40%
(2.9)
79.4
191.2
71.7
(3.5)
68.2
–
–
(25.9)
(23%)
–
(2.0)
(27.9)
–
(21.8)
(1.1)
(22.9)
206.4
13%
56.4
17%
27%
(4.9)
51.5
191.2
49.9
(4.6)
45.3
Corporate costs grew by 23%, to £25.9m reflecting the higher level of resources required to implement the strategic review and its
conclusions, including the separation and ultimate sales of the Digital Commerce and WGSN businesses. We have carefully evaluated
the appropriate size of the Corporate function to efficiently support the continuing business and in 2023 initiated a restructuring of both
the staff and supplier cost base. As a result Corporate costs are expected to reduce by a half to approximately £13m from 2024 onwards.
In addition, we will maintain a Transition, TSA and Separation team for the first half of 2024 to ensure that our obligations under the
disposal agreements are serviced and that all residual issues relating to the discontinued operations are completed. The costs of this team
of approximately £7m will be recorded as a Non-trading item.
25
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Financial review continued
Revenue
Non-trading items
The Company benefits from diverse revenue streams across its
two segments ranging from digital subscriptions to live events to
advisory. Most of these revenue streams have recurring or repeat
characteristics benefiting from our focus on customer retention.
34% of revenue (2022: 34%) was derived from non-events sources,
namely our Benchmarking Awards, Subscriptions and Advisory
service lines.
£’m
Events
Delegates
Sponsorship
Non-events
Benchmarking Awards
Subscriptions
Advisory
Revenue from continuing operations
2023
136.0
56.7
79.3
70.4
30.9
30.2
9.3
206.4
2022
125.7
58.3
67.4
65.5
27.8
30.2
7.5
191.2
Revenue from continuing operations grew to £206.4m (2022:
£191.2m), a reported increase of £15.2m or 8%, driven by the
performance of the Marketing segment. Adjusting for currency
impacts, the acquisition of Contagious in 2023 and the disposal
of RWRC at the end of 2022, revenue increased by 13% on an
Organic basis.
Adjusted EBITDA
Adjusted EBITDA from continuing operations grew to £56.4m
(2022: £49.9m), an increase of £6.5m or 13%. This represented
growth of 17% on an Organic basis. Adjusted EBITDA margin
increased from the prior year to 27.3% (2022: 26.1%). This reflected
a combination of very strong revenue growth offset by investment
ahead of the launch of Money20/20 Asia in Bangkok, in April 2024,
and TwentyFold, together with an increase in Corporate costs
reflecting resource levels required to complete the conclusions of
the strategic review, separation and ultimate sales of the Digital
Commerce and WGSN businesses. In 2023, we initiated the
resizing of our corporate costs to match the continuing business
through staff and supplier cost base restructuring and expect
that corporate costs will reduce by a half to approximately £13m
going forward.
Reconciliation between Adjusted EBITDA and statutory
operating profit
Adjusted EBITDA from continuing operations is reconciled to
statutory operating profit as shown in the table below.
£’m
Adjusted EBITDA
Depreciation
Adjusted operating profit
Non-trading items
Amortisation of acquired intangibles
Share-based payments
Statutory operating profit
1 Restated for discontinued operations.
2023
56.4
(4.9)
51.5
(4.4)
(9.0)
(7.4)
30.7
20221
49.9
(4.6)
45.3
(3.6)
(8.9)
(5.6)
27.2
In light of the level of corporate activity, significant Non-trading
items were incurred in 2023 – especially in relation to the
discontinued operations. These have been treated on a basis
consistent with our policy and with previous years, as set out in the
table below and further explained in Note 6.
£’m
2023
20221
Strategic review costs
Transaction and integration costs
(Loss)/profit on disposal of RWRC
Property impairments and provisions
Non-trading items relating to
continuing operations
Strategic review costs
Transaction and integration costs
Acquisition-related employment costs
and deferred consideration
ERP and Salesforce implementation
Profit on disposal of businesses
Non-trading items relating to
discontinued operations
Non-trading items relating to total operations
1 Restated for discontinued operations.
(1.5)
(0.7)
(0.3)
(1.9)
(4.4)
(83.5)
(17.3)
1.8
(7.1)
0.2
(105.9)
(110.3)
–
(0.7)
1.0
(3.9)
(3.6)
(15.0)
(15.5)
(31.4)
(21.6)
4.1
(79.4)
(83.0)
Continuing Operations
Strategic review costs relate to costs incurred to set up the
continuing Events-led business as a standalone business, as a
result of the separation, such as investor relations and rebranding
costs. Transaction and integration costs comprise legal and
professional fees for the acquisition and integration of Contagious.
Property impairments and provisions relate to a reassessment of
the Group’s property requirements as part of the strategic review
and the impact of onerous lease obligations that remain with the
continuing business following the disposals.
Discontinued Operations
Strategic review costs of £83.5m (2022: £15.0m) relate to the sales
of the Digital Commerce and WGSN businesses as part of our
optimisation of shareholder value, as well as the necessary
restructuring and reduction of Ascential’s central corporate function
as a result of the disposal of such a large proportion of the Group.
These costs related to resources and professional fees for project
management, tax and legal structuring, activities relating to the
aborted US listing, legal and professional advisor support as well as
severance and retention incentives for key personnel impacted by the
separation of the Group. Fees also include success fees paid to the
banks managing the disposal processes. The vast majority of these
costs have been recognised in 2023 either as services have been
provided or, for contingent success fees, on shareholder approval of
the disposals which occurred in December 2023. The significant scale
of Non-trading items across both 2022 and 2023 should be viewed in
the context of the expected distribution to shareholders of £850m
and the 2024 preliminary pre-tax profit on disposal of approximately
£500m (subject to finalisation of completion accounts).
26
Ascential plc Annual Report 2023 Transaction and integration costs of £17.3m (2022: £15.5m)
comprise professional fees for diligence and legal costs for
acquisitions and investments as well as the costs of integrating
acquisitions, such as the acquisitions of Sellics and Intrepid by the
Digital Commerce business in 2022 and their subsequent
integration. It also includes the execution of a significant staff
reduction in the second half of 2023 following the product
integration and launch of the Digital Commerce combined
product Flywheel Commerce Cloud.
Net finance costs relating to discontinued operations include
fair value adjustments in respect of Hudson of £116.7m arising
following the decision in October 2023 to sell the business in
order to complete the final elements of our strategic review.
The agreements we entered into with Hudson’s major
shareholder relating to this resulted in a transition from Hudson
being an equity-accounted associate to a fully consolidated
subsidiary as described further below.
Amortisation of acquired intangibles
The amortisation of acquired intangibles of £9.0m (2022: £8.9m)
primarily relates to brand and trade names of Lions, WARC and
Money20/20. We expect a step down in amortisation over the next
two years as certain assets are fully written down.
Adjusted profit before tax on continuing operations of £30.5m
reduced compared to 2022’s £42.9m. This reflects the growth in
net finance costs, which more than offset the higher level of
Adjusted EBITDA and operating profit. Total profit before tax for the
year of £10.6m, compared to the profit in the prior year of £24.8m.
Profit before tax
Share-based payments
Taxation
The charge for share-based payments in continuing operations
of £7.4m (2022: £5.6m) was higher in 2023 than in 2022 due to the
acceleration of vesting for good leavers from the continuing
business in the period. The charge for discontinued operations
likewise increased from £10.3m to £16.4m.
Net finance costs
The total net finance costs for the year ended December 2023
were £132.7m (2022: £18.7m) as set out in the table below:
£’m
Interest income on deposits and investments
Interest payable on external borrowings
Fair value (loss)/gain on derivative financial
instruments
Amortisation of arrangement fees
Discount unwind on lease liabilities
and provisions
Foreign exchange gain
Adjusted net finance costs relating
to continuing operations
Remeasurement of trade investments
to fair value
Net finance costs relating to
continuing operations
Net finance costs relating to
discontinued operations
Net finance costs relating to total operations
2023
5.6
(21.3)
(4.3)
(0.8)
(0.2)
-
2022
0.5
(7.4)
4.3
(0.8)
-
1.0
(21.0)
(2.4)
0.9
-
(20.1)
(2.4)
(112.6)
(132.7)
(16.3)
(18.7)
The Group’s net finance costs from continuing operations have
increased from £2.4m in 2022 to £20.1m in 2023 due mainly to the
significantly higher interest expense payable on external borrowings
since the second half of 2022. This reflects the higher underlying
interest rates for both our USD and Euro borrowings, combined
with a higher average level of net debt in 2023 compared to the
prior year, particularly in the second half as we funded Digital
Commerce to accelerate the payment of deferred consideration
and the repayment of its factoring facility ahead of its sale.
A tax charge on continuing operations of £4.8m (2022: £8.0m)
was incurred on the reported profit before tax of £10.6m (2022:
£24.8m) due to lower levels of tax deductibility of Adjusting items,
such as disposal costs and share-based payment costs in respect
of non-UK staff. A tax charge of £8.1m (2022: £10.9m) was incurred
on Adjusted profit before tax of £30.5m (2022: £42.9m) resulting in
an Adjusted effective tax rate for the period of 27% (2022: 25%)
broadly in line with the underlying UK and US corporate tax rates.
The composition of the tax charge on continuing operations is
summarised in the table below.
Analysis of tax charge (£’m)
Adjusted profit before tax
Tax charge on Adjusted profit before tax
Effective tax rate (%)
Adjusting items
Tax credit on Adjusting items
Effective tax rate on Adjusting items (%)
Reported profit before tax
Tax charge on reported profit before tax
Effective tax rate on reported profit before
tax (%)
2023
30.5
(8.1)
27%
2022
42.9
(10.9)
25%
(19.9)
(18.1)
3.3
17%
10.6
(4.8)
2.9
16%
24.8
(8.0)
46%
32%
The Group has a recognised net deferred tax asset of £84.6m
(2022: £51.7m) comprising a £7.6m (2022: £8.6m) deferred tax
liability on non-deductible intangibles and an asset of £92.2m
(2022: £60.3m) relating to UK and US losses, accelerated capital
allowances and US acquired intangibles.
The vast majority of this net deferred tax asset, amounting to
approximately £91m, was utilised shortly after the year end in January
2024 against gains arising on the disposal of Digital Commerce and
restructuring of the US corporate structure. This 2024 restructuring
also resulted in the recognition of a new deferred tax asset relating to
Money20/20 USA and WARC USA of approximately £45m that will
be realised in cash over the next 15 years.
27
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Financial review continued
Discontinued operations
The results of the discontinued Digital Commerce, WGSN and Hudson businesses are included as a single line item within Profit After
Tax but are set out in detail in Note 11. They can be summarised as follows:
Total Discontinued Operations
£’m
Adjusted results Adjusting items
Total Adjusted results Adjusting items
2023
2022
Revenue
Adjusted EBITDA
Depreciation, amortisation and
impairment
Non-trading items
Share-based payments
Operating profit/(loss)
Share of the loss of associates
Net finance income/(costs)
Profit/(loss) before tax
Taxation (charge)/credit
Profit/(loss) after tax
379.9
65.6
(17.3)
–
–
48.3
(12.4)
3.3
39.2
(14.5)
24.7
–
–
(30.3)
(105.9)
(16.4)
(152.6)
(0.9)
(115.9)
(269.4)
49.2
(220.2)
379.9
65.6
(47.6)
(105.9)
(16.4)
(104.3)
(13.3)
(112.6)
(230.2)
34.7
(195.5)
333.2
71.2
(21.1)
–
–
50.1
(2.6)
(11.0)
36.5
(10.1)
26.4
–
–
(82.7)
(79.4)
(10.3)
(172.4)
(0.6)
(5.3)
(178.3)
29.4
(148.9)
Total
333.2
71.2
(103.8)
(79.4)
(10.3)
(122.3)
(3.2)
(16.3)
(141.8)
19.3
(122.5)
Foreign currency translation impact
The Group’s reported performance is sensitive to movements in both the Euro and US Dollar against Pounds Sterling with significant
events revenues in Euro and US Dollars. As can be seen from the table below, Pounds Sterling was particularly weak against the US Dollar
in 2022, which has negatively impacted the reported growth rates in our financial performance in 2023.
Currency
Euro
US Dollar
Weighted average rate
Year-end rate
2023
1.17
1.22
2022
1.17
1.10
Change
0.5%
(10.8%)
2023
1.15
1.27
2022
1.13
1.21
Change
(2.0%)
(5.2%)
When comparing 2023 and 2022, changes in currency exchange rates had an adverse impact on revenue and EBITDA from
continuing operations of £3.6m and £2.2m respectively. On a segmental basis, the impact of changes in foreign currency exchange
rates was as follows:
• Marketing: a £0.9m impact on revenue and a £0.2m impact on Adjusted EBITDA;
• Financial Technology: a (£4.5m) impact on revenue and (£3.1m) on Adjusted EBITDA; and
• Corporate costs: a £0.7m impact on Adjusted EBITDA.
For illustrative purposes, the table below provides details of the impact on revenue and Adjusted EBITDA from continuing operations if
the results were restated for Pounds Sterling weakening by 1% against the US Dollar and Euro in isolation.
£’m
Euro
US Dollar
2023
2022
Revenue
1.3
0.7
Adjusted
EBITDA
0.9
0.4
Revenue
1.0
0.7
Adjusted
EBITDA
0.8
0.4
28
Ascential plc Annual Report 2023 Earnings per share
Investments
Adjusted diluted earnings per share for continuing operations
were 5.0p per share (2022: 7.2p). Total diluted loss per share for
continuing operations was 1.3p (2022: profit of 3.8p) with 2023
impacted by higher levels of Adjusting items to effect the strategic
review and consequent disposals of Digital Commerce and WGSN.
Acquisition of Contagious
In August 2023, the Group acquired 100% of Steel River Media
Limited (“Contagious”) for a cash consideration on a cash and
debt-free basis of £8.0m. Contagious is a multi-format creative
insights and trend analysis business, serving agency and brand
customers. The business delivers a mix of subscription, advisory
and events revenue streams and has been integrated into the
Marketing segment with synergies expected from both
Lions and WARC.
Disposal of Digital Commerce and WGSN businesses
On 2 January 2024, the Group completed the sale of its Digital
Commerce business to Omnicom Group Inc. and on 1 February
2024, the Group completed the sale of the Product Design
business, WGSN, to Wind UK Bidco 3 Limited (a newly formed
company established by funds advised by Apax Partners).
Proceeds for both transactions totalled £1.2 billion and the pre-tax
profit on disposal from the two transactions arising in early 2024 is
expected to be approximately £500m (subject to customary
closing adjustments) with a tax charge of approximately £50m
(£9m current cash tax and the balance from using deferred tax
assets such as brought-forward losses) arising on the disposals and
associated corporate restructuring. The tax charge has been
reduced by the utilisation of £23m of capital losses resulting from
the revaluation and transfer of Hudson MX and the recognition of
£45m of deferred tax assets on the transfer of Money20/20 LLC
and WARC LLC as part of the corporate restructuring.
The Group has a material investment in Hudson MX (“Hudson”),
an advertising software business providing media buying and media
accounting solutions through a cloud-based software as a service
(“SaaS”) platform and which was held for sale as of December 2023.
There were two material corporate transactions that affected the
accounting for Hudson during 2023. Hudson completed a new
financing and capital restructuring resulting in MT II Holdings LLP
(“MTII”) becoming Hudson’s majority shareholder in February 2023.
Ascential and MTII modified the February 2023 financing and
capital agreements in October 2023 as part of the decision to
initiate the ongoing process to sell Hudson.
As part of the February 2023 financing and capital restructuring,
new investor MTII provided £24.9m of fresh investment to the
Hudson business and purchased part of Ascential’s holding of
preference shares for £24.9m while Ascential agreed to provide
a further £17.9m of funding to Hudson. As a result, MTII held 51%
of Hudson’s common stock, Ascential held 36.5% and Hudson’s
management team and pre-existing shareholders held 12.5%.
Ascential also agreed arrangements to provide a potential path
to a majority stake in the future, including granting a put option to
MTII, exercisable from 1 April 2024 to 31 December 2025, which if
exercised would result in Ascential holding a 79% common equity
interest in Hudson with Ascential then having the right to call the
remaining shares owned by MTII in the two years following any
exercise of their put option. Additionally, both Ascential and
Hudson’s management team, along with other existing investors,
agreed on options exercisable between February 2026 and December
2028, with a total consideration ceiling of $40m that would, if
executed, increase the Group’s equity stake in Hudson to 49%.
In October 2023, following the Board’s decision that Hudson was
not core to the ongoing business of Ascential following the sale
of Digital Commerce, Ascential agreed with MTII to proceed with
the sale of Hudson and entered into new arrangements with MTII
in order to ensure that MTII will receive at least the same
consideration for its stake in Hudson when the business is sold as
it would have done if: (i) the existing put option and the call option
with MTII had been exercised in April 2024; and (ii) Hudson’s debt
obligations to MTII on such exercise had been honoured.
29
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Financial review continued
The value of the consideration due to MTII if the existing put
option and the call option are exercised is approximately
$85.1m (£66.9m), being the combined purchase price for the
equity and debt instruments held by MTII. Ascential will fund any
shortfall between this amount and proceeds received by MTII on
the sale of Hudson. In the event that the sale process for Hudson
does not complete by 15 April 2024, MTII’s and Ascential’s existing
put and call options will be automatically exercised and the full
amount would be payable to MTII by Ascential.
From October 2023, when Ascential entered into these new
arrangements with MTII, Ascential’s ability to take control (due
to Ascential being able to exercise its call option from that point)
meant that the investment ceased to be considered an equity-
accounted associate and was consolidated on a line-by-line basis
with our investments eliminated and replaced (subject to fair value
adjustments and additional consideration) with acquired
intangibles and the assets of the business. The announced
intention of Ascential to sell the business and likelihood of success
means that the Hudson business is presented as held for sale and
as a discontinued operation.
In the 10 months to October 2023, within discontinued operations
we recorded our share of the losses of Hudson totalling £13.2m
(2022: £2.8m loss) and recognised interest receivable of £10.2m
(2022: £3.1m) relating to the preference shares held. On the
transition between classification as associate and full
consolidation, Finance costs of £116.7m were expensed,
representing a reduction in the value of our existing investment
including the valuation of the call and put options and the amount
payable for the assets acquired relative to the deemed value of the
business acquired. The valuation used was completed by an
independent expert from a general market participant standpoint
at the time and reflects the early-stage profile of the business, with
limited proof points from a peer group perspective or of the
expected future high growth of such a disruptive business. Due to
the sensitivity of valuation inputs, the sale process may conclude
with a materially different business valuation. For the two months
of consolidation in the year, we included revenue of £1.5m as well
as Adjusted EBITDA and Adjusted operating losses of £1.6m within
discontinued operations.
Further details of the restructuring and the accounting for Hudson
can be found in Note 30.
Cash flow
Continuing operations
The Company generated Adjusted operating cash flow from
continuing operations of £62.9m (2022: £56.9m), being a 112%
(2022: 114%) operating cash flow conversion in the year. The
Group’s Adjusted EBITDA increased by £6.5m to £56.4m but this
was partially offset by a £4.2m increase in tax payments. As a
result, the Company generated free cash flow of £54.2m (2022:
£53.2m) as shown in the table below:
£’m
Adjusted EBITDA
Working capital movements
Adjusted operating cash flow from
continuing operations
Operating cash flow conversion (%)
Capital expenditure
Tax (paid)/refunded
Free cash flow from continuing operations
Free cash flow conversion (%)
2023
56.4
6.5
62.9
112%
(5.3)
(3.4)
54.2
96%
2022
49.9
7.0
56.9
114%
(4.5)
0.8
53.2
107%
Discontinued operations
The Company generated free cash flow from discontinued
operations of £5.3m (2022: £35.9m) with the outflow from working
capital movements primarily driven by the £26.6m repayment of
the Digital Commerce working capital factoring facility in
preparation for the disposal.
£’m
Adjusted EBITDA
Working capital movements
Adjusted operating cash flow from
discontinued operations
Operating cash flow conversion (%)
Capital expenditure
Tax paid
Free cash flow from discontinued operations
Free cash flow conversion (%)
2023
65.6
(23.5)
42.1
64%
(35.9)
(0.9)
5.3
8%
2022
71.2
(2.9)
68.3
96%
(31.4)
(1.0)
35.9
50%
30
Ascential plc Annual Report 2023 Total operations
Strong balance sheet and access to liquidity
The cash flow statement and net debt position are summarised
as follows.
£’m
Free cash flow from continuing operations
Free cash flow from discontinued
operations
Free cash flow from total operations
Acquisition of businesses net of cash
acquired
Deferred contingent consideration
including contingent employment cost
Acquisition of investments and
loan to associate
Proceeds from sale of equity-accounted
investments
Non-trading costs paid
Cash flow before financing activities
Proceeds from external borrowings
Repayment of external borrowings
Net interest paid
Net lease liabilities paid
Share purchases
Proceeds of issue or sale of shares
net of expenses
Dividends paid to non-controlling interest
Net cash flow
Opening cash balance
FX movements
Closing cash balance
Borrowings
Capitalised arrangement fees
Derivative financial instruments
Net debt
Returns to shareholders
2023
54.2
5.3
59.5
2022
53.2
35.9
89.1
(6.8)
(60.8)
(69.6)
(57.4)
(23.1)
(34.6)
24.9
(66.4)
(81.5)
170.1
(47.5)
(15.7)
(8.1)
(5.7)
0.5
(2.2)
9.9
80.0
(3.4)
86.5
(412.4)
0.8
7.0
(318.1)
5.9
(52.3)
(110.1)
176.8
(53.8)
(9.0)
(7.3)
(3.7)
0.3
(2.8)
(9.6)
84.1
5.5
80.0
(302.8)
1.6
4.5
(216.7)
Following completion of the disposals of Digital Commerce and
WGSN and extensive consultation with shareholders, we have
announced our intention to return £850m to shareholders by way of:
• a tender offer to acquire up to £300m of Ascential shares;
• a special dividend of at least £450m, accompanied by a share
consolidation; and
• on-market share buyback programmes to acquire £100m
of Ascential shares.
Going forward, the Company intends to return to the policy
of paying an annual dividend.
Ascential manages its capital to ensure that entities in the Group
will be able to continue as going concerns while maximising the
return to shareholders through the optimisation of the debt-to-
equity balance. The capital structure of the Group consists of
debt, cash and cash equivalents and equity attributable to equity
holders of the parent comprising capital, reserves and retained
earnings. The Group’s policy is to borrow centrally to meet
anticipated funding requirements. These borrowings, together
with cash generated from operations, are on-lent at market-based
interest rates and on commercial terms and conditions or
contributed as equity to subsidiaries.
In December 2023, the Group signed a new four-year multi-
currency revolving credit facility (“RCF”) of £225m with an
accordion of up to a further £75m or 100% of EBITDA. These
facilities became effective on completion following the sale
of Digital Commerce in January 2024. The proceeds received
as a result of this sale were used in part to repay the net debt
of the Group of £318.1m at 31 December 2023. The balance of
the Digital Commerce sale proceeds, the proceeds from the
sale of WGSN and the new RCF will fund the proposed £850m
return to shareholders with the balance expected to provide
ample future liquidity.
The more sensitive aspects of the Company’s financing are the
application of certain covenant limit tests to these facilities and the
most sensitive covenant limit is Net Debt Leverage (broadly, the
ratio of Net Debt to Adjusted pre-IFRS 16 EBITDA). The new facility
covenants are tested semi-annually and include (i) a maximum Net
Debt leverage of 3.00x and, (ii) a minimum interest cover of 3.00x.
At 31 December 2023, our leverage ratio was 2.7x compared to the
old facility limit of 3.25x prior to the repayment of the facility from
the proceeds of the disposal of Digital Commerce in January 2024.
Ascential aims to operate with net leverage of between 1-2x
Adjusted EBITDA, although may operate above these levels
temporarily following acquisitions.
Going concern
The Board is required to assess going concern at each reporting
period. These assessments require judgement to determine the
impact of future economic conditions on the Group, including the
impact of downward recessionary pressures. After considering the
current financial projections and the bank facilities available and
then applying a severe but plausible sensitivity, the Directors of the
Company are satisfied that the Group has sufficient resources for
its operational needs and will remain in compliance with the
financial covenants in its bank facilities for at least the next 12
months from the date of approving these financial statements.
The process and key judgements the Directors have considered
in reaching their conclusions on going concern relate to liquidity,
covenants and scenario planning and are set out in Note 1.
Mandy Gradden
Chief Financial Officer
25 March 2024
31
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Risk management
and principal risks
Identifying and managing risk is an integral part of our corporate governance as it helps us
deliver long-term shareholder value and protect our business, people, assets, capital and
reputation. In order to achieve our strategic objectives and seize market opportunities, risk
must be both accepted to a reasonable degree within our risk appetite and balanced by
proportionate reward.
Risk governance
It is the responsibility of all of our colleagues to manage risks
within their domain. Ultimately, accountability for risk management
resides with the Board which is responsible for ensuring that there
is an adequate and appropriate risk management framework and
culture in place.
Our risk governance framework is set out below. At the top of the
structure is our Board, which holds overall responsibility for our risk
management and internal control systems. The Board sets risk
appetite and the tone of risk management, as well as completing
assessments of our principal risks.
The Audit Committee assists the Board by monitoring the
adequacy and effectiveness of internal control and risk
management systems, as well as the effectiveness of Internal
Audit. Our Operational Risk Committees identify risks and risk
owners, controls and mitigations to manage risks, target risks and
agree action plans to strengthen controls and address deficiencies,
review progress with action plans and identify emerging risks.
Enterprise Risk Management Framework
We have a formal Enterprise Risk Management Framework
which documents our risk management policy, risk management
approach, risk appetite and tolerance, risk response options, and
risk management process. This framework was updated in January
2024 to reflect the disposals of Digital Commerce and WGSN.
An out-of-cadence reporting and escalation process has also been
defined to ensure that risks are effectively managed on a more
urgent basis where necessary.
Risk assurance
Internal Audit provides assurance as to the effectiveness of the
internal control environment through its primary responsibilities
whereby it:
• reviews and assesses the internal control environment with
a focus on control effectiveness, quality and continuous
improvement;
The Audit Committee receives and analyses regular reports from
management and Internal Audit on matters relating to risk and control
and reviews the timeliness and effectiveness of corrective action
taken by management. The Audit Committee also considers the
findings and recommendations of the External Auditor throughout the
year in relation to the design and implementation of effective financial
controls. Further detail on these activities is included within the Audit
Committee report on page 94.
Risk governance framework
We have a bottom-up and top-down approach to
manage risk at Ascential:
The Board
Audit Committee
• Holds overall
• Monitors the
adequacy and
effectiveness of
internal control and
risk management
systems
• Monitors and reviews
the effectiveness of
Internal Audit
responsibility for
Ascential’s risk
management and
internal control
systems
• Defines risk appetite
taking into account
Ascential’s strategic
objectives
• Sets the tone and
influences the culture
of risk management
• Assesses the principal
risks, including
emerging risks, and
their alignment with
risk appetite
Operational Risk Committees
• Identify risks and risk owners (including
• determines whether controls are appropriate to provide
emerging risks)
financial, managerial and operating information that is accurate,
reliable and timely;
• Score impact of risk on an inherent and residual
basis according to risk scoring methodology
• determines whether risks are appropriately identified and
• Sets target risks
managed;
• assesses whether assets are appropriately safeguarded; and
• evaluates the systems established to ensure compliance with
those policies, plans, procedures, laws and regulations which
could have a significant impact on Ascential.
• Identify controls and mitigations to manage risk
• Agree action plans to strengthen controls or
address deficiencies
• Review progress with action plans and
current risks
• Membership includes senior management
e
c
n
a
i
l
p
m
o
c
d
n
a
s
o
r
t
n
o
c
l
l
a
n
r
e
t
n
I
s
e
i
t
i
v
i
t
c
a
t
i
d
u
a
l
a
n
r
e
t
x
e
d
n
a
l
a
n
r
e
t
n
I
32
Ascential plc Annual Report 2023
The Operational Risk Committees during 2023 were
structured to align to a business unit, brand or central
function as appropriate:
Following the disposals of Digital Commerce and WGSN, the
business facing Operational Risk Committees have been
restructured to align to the ongoing business:
Digital Commerce
Digital Commerce – China
Product Design
WARC
Lions
Money20/20
Finance and Taxation
M&A
Technology
Lions Division (Lions, WARC and Contagious)
Money20/20
Acuity Pricing
Finance and Taxation
Technology
M&A
The Operational Risk Committees use the following process to manage risk:
Objectives
Id e n tif y
Analy
s
e
Ascential Risk
Management
Process
R
e
p
o
r
t
d
n
o
p
Res
Monito r
Risk and Controls
1. Identify key risks, including emerging risks
2. Analyse the potential impact and likelihood of risks
3. Respond to risks by considering existing controls as well as
selecting, prioritising and implementing appropriate actions
4. Monitor the internal and external environment for potential
changes to risks and ensure that risk responses continue
to operate effectively
5. Report on risks and the status of risk responses adopted
We recognise that there were different levels of risk
management maturity across our Operational Risk Committees
during 2023, reflecting the maturity of the underlying products
and capabilities within Digital Commerce as well as the rate of
change within them. Risks identified through pre-acquisition
due diligence are initially managed through the post-acquisition
integration programme, with any longer-term risks integrated
into the Operational Risk Committee process. Due to the
ongoing work to position the Digital Commerce business for
separation during 2023, the Digital Commerce Operational Risk
Committees’ meetings were suspended after Q1 2023 and risk
management was instead controlled through a separate process
designed to ready the business for listing on a US stock
exchange. A dedicated VP of Internal Controls and SOX
was in place throughout the year.
33
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Risk management continued
Long-term viability statement
The Directors have assessed the prospects and viability of the
Group in accordance with Provision 31 of the UK Corporate
Governance Code.
By their nature, forecasts inherently become less accurate and
more uncertain as the planning horizon extends. While we
prepare a five-year plan, the plan’s focus is mainly on the first
three years with the outer two years relying more on expected
trends and extrapolations. Detailed business planning focusses on
this near-term three-year horizon and is based on the information
available to the Group for the markets and operating
environments in which the Group operates. Decisions on future
funding and capital allocations are focused on this period. In this
context, the long-term viability assessment has been based on a
three-year time frame, covering the period to 31 December 2026.
Furthermore, we have not identified any significant foreseeable
risk events relating to the principal risks that are likely to
materialise only within the three- to five-year period.
The Company’s prospects have been assessed mainly with
reference to the Company’s strategic planning and associated
long-range financial forecast. This incorporates a detailed
bottom-up budget for each division of the business. The
budgeting and planning process is thorough and includes
input from most operating line managers, as well as senior
management, and forms the basis for most variable
compensation targets. The Board participates in strategic
planning and reviews the detailed bottom-up budgets. The
outputs from this process include full financial forecasts of
revenue, EBITDA, Adjusted and statutory earnings, cash flow,
working capital and net debt. The Directors consider that the
planning process and monthly forecast updates provide
a sound underpinning to management’s expectations
of the Group’s prospects.
The Directors carried out a robust assessment of the principal
and emerging risks facing the Group, including those that could
threaten its business model, future performance, solvency or
liquidity. This assessment was made with reference to the
Company’s current position and prospects, strategy and principal
risks, including how these are managed.
The Directors then assessed the potential impact on the
Company’s prospects should certain risks to the business
materialise. This was done by considering specific scenarios
aligned to the principal risks identified on pages 35 to 41, applied
to stress test the long-range financial forecast. Of these, the four
scenarios considered to have the most serious impact on the
financial viability of the Company were modelled in detail.
The specific scenarios were:
1. the cancellation of a major event at short notice;
2. recession;
3. a serious safety and security incident at a major event; and
4. the loss of a major customer.
All of the scenarios have been run in conjunction with the
scenario of closure of Hudson if no sale is concluded.
The Directors have considered the effect of compounding the
cancellation of a major event at short notice and the loss of a
major customer and concluded that the Group would be
expected to be able to continue to fund its operations and
comply with debt covenant requirements.
For each scenario, the modelling captured the impact on key
measures of profitability, cash flow, liquidity and debt covenant
headroom. Scenarios included the effects of plausible
mitigation plans where available including decisions on future
capital allocation and a review of discretionary spending.
In all cases modelled, the Group was able to demonstrate
covenant headroom.
Based on this assessment of prospects and stress-test scenarios,
together with its review of principal risks and the effectiveness of
risk management procedures, the Directors confirm that they
have a reasonable expectation that the Company will be able to
continue in operation and meet its liabilities as they fall due over
the period to 31 December 2026.
34
Ascential plc Annual Report 2023 Principal and emerging risks
and uncertainties
Our risk-scoring methodology for our principal risks takes into
account the likelihood and impact of an identified risk at a Group
level. Following the disposals of Digital Commerce and WGSN, we
consider that whilst the likelihood of our event related risks has not
changed materially, the impact at a Group level has increased. We
therefore consider the unmitigated risk relating to live events to be
increased compared to the prior year.
In the prior year, our acquisitions and disposal-related risk was
primarily driven by the early stage and number of acquisitions we
made to build out our digital commerce capability set. Whilst we
will continue to identify bolt-on and adjacent acquisitions which
complement our ongoing brands and products, we have multiple
levers for organic revenue growth and we therefore consider the
risk relating to acquisitions and disposals to be reduced from the
prior year.
We have removed the data access, data scraping and platform
risks from our principal risk register as this risk related primarily
to our Digital Commerce business.
The Board considers the following to be the Company’s principal
risks in respect of its continuing business as at 31 December 2023:
Risk
Change since December 2022
Unmitigated
Mitigated
1.
Economic/geopolitical
Unchanged
Unchanged
2. Customers and competition
Unchanged
Unchanged
3.
Climate Change and
Sustainability
4.
Cyber threat and
information security
5. People risk
6. Live events
New
New
Unchanged
Unchanged
Reduced
Reduced
Increased
Unchanged
7.
Acquisitions and disposals
(including integration)
Reduced
Reduced
8. Business resilience
Unchanged
Unchanged
9. Financial risk
Unchanged
Unchanged
10. Regulation and compliance
Unchanged
Unchanged
We define risk as any potential event
which could prevent the achievement
of an objective. Risks can arise from the
likelihood that an opportunity will not
happen, as well as from the threat or
uncertainty that something with a
negative impact will happen.
The Board has assessed the principal risks facing the business
including those related to its business model, future performance,
solvency or liquidity and considered them in the formulation of the
Long-Term Viability Statement set out on the previous page. This
review of principal risks includes any emerging risks identified
during the year.
The following pages summarise our principal risks and
uncertainties with mitigating actions, as identified by the Board
for the year ended 31 December 2023 in respect of continuing
operations. The list is not exhaustive and may change during
2024 as the risk landscape evolves.
We remain conscious of the continued economic uncertainty in
which we operate. Whilst interest rate increases have been paused
by the US, UK and eurozone central banks and the risk of a hard
recession in the US appears to have lessened, the effects of the
higher interest rates and the uncertainty around how long they will
last continue to impact the global economy. The Russia-Ukraine
and Middle East conflicts continue to pose a significant geopolitical
risk in 2024 and whilst not considered to present a direct, material
impact to Ascential, the uncertainty presented by increasing
geopolitical tensions remains. We therefore consider the risks
associated with economic and geopolitical uncertainty to be
unchanged from 31 December 2022. We continue to incorporate
recession modelling and scenario planning into our budget and
medium-term planning process and this is kept under review as
economic conditions change.
The completion of the strategic review and disposals of Digital
Commerce and WGSN has alleviated the strategic uncertainty
that some of our people experienced during 2023. The focus of the
ongoing business as an events-led business enables us to simplify
and refine our people and reward strategy to ensure that we can
continue to attract and retain key talent. We therefore consider that
our people-related risk has reduced since the prior year.
Delivering long-term sustainable success is a core objective
for Ascential. Following the disposals of Digital Commerce and
WGSN, we re-evaluated our assessment of climate related risks and
opportunities and confirmed our ambition to be one of the most
sustainable events-led businesses in the world. We know that
environmental responsibility is a critical issue for our people, our
customers, our shareholders and our planet and we have therefore
identified climate change and sustainability as one of the
Company’s principal risks for the first time. You can read more
about our plans in this area and the way that we manage climate-
related risks on pages 62 to 67.
35
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Risk management continued
Business and strategic
1. Economic/geopolitical
Description
Across our business we
are exposed to the effects
of political and economic risks.
These include the likelihood of
global recession, international
conflicts and the impact of
international trade policy
and sanctions.
Examples of risks
• Global recession or high inflation (or recession/high inflation in key
geographies) could lead to reduction in customer spending, increased
supplier costs and increased wage expectations
• A tougher macroeconomic climate could lead to tightening of funding
to the fintech sector resulting in reduction of marketing spend by
Money20/20 US customers
• International conflicts may lead to reduced delegate attendance
Risk movement
from 2022
Unchanged
How we manage risk
• Recession modelling and scenario planning is a key part of the Budget
process and is kept under review as economic conditions change
• The procurement team monitor relationships with suppliers to ensure
we receive value in accordance with agreed terms and negotiate prices
acceptable to the business during renewal
• Annual pricing strategy reflects economic environment
• Subscription products are subject to auto renewal including fee increase
• Focussed cost control measures can mitigate short-term impact on margin
2. Customers and competition
Description
Customer behaviour, needs
and preferences can change
as well as the competitive
environment for our products
and services.
Risk movement
from 2022
Unchanged
Examples of risks
• Customer concentration increases financial impact if key
customers are lost
• Competitor show dates could move closer to Ascential event dates
• Geographical expansion leads to operating in higher competition markets
• AI enables content to be taken and replicated
How we manage risk
• Increased diversification of revenue streams to reduce concentration
of event-driven revenue
• Broadening of customer types through increased engagement with brands
• Continuous development of products to maintain competitive advantage
• Competitive intensity considered as part of geographic expansion strategy
• Strong brand value drives customer loyalty
36
Ascential plc Annual Report 2023 3. Climate change and sustainability
Description
Effectively managing the
impact of climate change
underpins our ability to deliver
long-term sustainable success.
Risk movement
from 2022
New
Examples of risks
• Customers perceive emissions associated with attending events
or waste generated at events to be a barrier to attendance
• Inability to meet customers’ sustainability expectations
• Poor corporate responsibility practices could reduce Ascential’s
attractiveness as an employer to key talent
• Supply chain is disrupted through extreme weather events
How we manage risk
• Sustainability strategy and net zero transition plan being developed
(see pages 59 to 60 for more detail)
• Procurement team assess suppliers to understand their sustainability
status and reduce reliance on single suppliers
• Carbon footprinting of events undertaken and events sustainability
standards developed
Operational
4. Cyber threat and information security
Description
An external cyber attack,
insider threat or supplier
breach could cause services
interruption, the loss of
confidential data, reputational
impact and regulatory censure.
Risk movement
from 2022
Unchanged
Examples of risks
• False payment instructions are processed
• Targeted cyber attacks by hostile states
• Ransomware attack by hostile actors
• Major data privacy breach
How we manage risk
• Maintenance and testing of network security, network resilience and
business continuity plans
• Monitoring of emerging threats to ensure our preparations and responses
are current
• Regular, comprehensive training programme for our employees
on information security practices
• Implementation of Data Loss Prevention software
• Adoption of additional authentication tools to reduce the likelihood
of remote attacks
• Regular penetration and vulnerability testing
• Focus on cloud governance and logging
• We purchase cyber insurance to mitigate any losses arising from
a cyber security incident
37
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Risk management continued
Operational continued
5. People Risk
Description
People management, effective
succession planning and the
ability to attract and retain
talent are critical to our ability
to execute our strategy and
achieve our objectives.
Examples of risks
• Loss of key talent, high attrition and/or lack of appropriate
succession planning could lead to a strategic skills shortage
and or senior management
• Loss of intellectual capital due to poor retention of talent
• Inability to attract and retain employees
Risk movement
from 2022
Reduced
How we manage risk
• Succession planning for Executive Directors and Senior Leadership Team
• Reward benchmarking conducted for key talent and adjustments made
where warranted
• Monthly pulse engagement surveys to monitor employee engagement
and wellbeing
• Launched clear People Plan for 2023 including target Peakon scores across
Engagement, Health & Wellbeing and Diversity & Inclusion
• Launched a People Committee for the UK and US teams
6. Live Events
Description
Our events are held at
specific locations which may
become unavailable for use.
Travel disruption or safety
risks from a variety of causes
including natural disasters,
communicable diseases, civil
disorder, political instability
or terrorism may prevent
both customers and our
employees from reaching
the event location or being
unwilling to travel.
Examples of risks
• Terrorist attacks during or shortly before events could result in fatalities,
injuries, reputational damage and loss of revenue
• Civil disorder or organised protests disrupt an event or make accessing
Risk movement
from 2022
Increased
the venue difficult
• Government restrictions prohibit people from attending large-scale events
• A global pandemic means that people are unable or unwilling to travel and
attend large-scale events
• Single third-party technology supplier fails to deliver, causing disruption
or negatively impacting delegate experience
• Travel disruption prevents staff, delegates and sponsors from
attending an event
• Health & safety incidents occur during the event
• Inability to secure large enough venues
Actions taken to manage risk
• Global threat monitoring throughout the year to identify any significant
risks and to inform Safety and Security plan for each event
• Protective intelligence monitoring prior to and during an event with
appropriate measures and contingency plans developed and agreed
with the venue and local government
• Development of virtual content for events
• Safety Risk Assessment and Event Safety & Security Plan completed
prior to each event
• Insurance cover in respect of certain event cancellation risks
38
Ascential plc Annual Report 2023 Risk movement
from 2022
Reduced
Risk movement
from 2022
Unchanged
7. Acquisitions and Disposals (including integration)
Description
Whilst we continue to invest in
organic growth and product
development, acquisition of
bolt-on and adjacent
capabilities remains part of
our strategy. Acquisitions
which do not deliver
anticipated value, are a poor
strategic fit or are not
integrated effectively risk
financial loss/loss of market
share/reputation damage.
Examples of risks
• Overestimation of synergies or growth potential
• Unknown issues and matters arise during integration
not detected in diligence
• Earnout structure not aligned with Ascential’s long-term objectives
• Disposed businesses may not realise their optimum valuation due to
timing of disposal or failure of the sale process. There may be retained
liabilities relating to disposed businesses which could impact the cash
flows of the Company.
How we manage risk
• We take a disciplined approach to identifying and testing acquisitions
to ensure they are aligned to our strategy and present an acceptable
rate of return.
• We carry out detailed synergy diligence and modelling
• Detailed cross-functional due diligence is undertaken prior to acquisition
• We include appropriate warranties to cover any liabilities arising from
pre-completion conduct
• Post-closing covenants are in place to ensure local team meet Ascential
conduct standards
• We run a formal integration programme with longer-term risks integrated
into the risk management process
8. Business Resilience
Description
Our operations may be
disrupted by an adverse
event whether that be IT
service interruption,
disruption to physical
locations or interruption
in the provision of service
from our key suppliers.
Examples of risks
• Website receiving payments (e.g. Lions awards
and delegate passes) is inaccessible
• Pandemic leads to enforced extended working from home
• Natural disaster impacts key operational location
• Key supplier failure, for example, insolvency of a key supplier
that we had been unprepared for
How we manage risk
• Cloud Architectures are built in a resilient fashion and all architectures
are documented to identify and understand risk
• Proven ability to perform effectively over extended remote working periods
• The nature of Ascential’s business being asset light and diversified across
different sectors and regions minimises potential impact of localised
weather events
• Group crisis management plan to manage how the Senior Leadership
Team directs the business through any major incident or crisis which
may severely disrupt operations, threaten business performance or
damage reputation
• Technical incident response process in place
• Long-term contacts in place with key suppliers, professionally procured
and with rigorous Service Level Agreements and due diligence as part
of RFP process
• Financial security of key suppliers under continuous review.
Alerting set up for all key suppliers so Ascential Procurement
are notified of any change in circumstance
39
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Risk management continued
Financial
9. Financial Risk
Description
Insufficient balance sheet
strength and liquidity may
prevent the Company’s ability
to execute its strategy or ability
to trade as a going concern.
Material exposures to different
currencies and fluctuations in
those currencies affect the
reported financial results. Tax
law and administration is
complex and tax authorities
may challenge our application
of tax law, potentially leading
to lengthy and costly disputes
and material tax charges.
Financial reporting
requirements are complex
and errors in the Company’s
financial statements could lead
to reputational damage and
censure from regulators.
Risk movement
from 2022
Unchanged
Examples of risks
• Significant loss of revenue and/or profit causes breach
of banking covenants
• Uncertain macroeconomic environment could lead to increased
complexity in accounting judgements
• Change in tax legislation could lead to significantly higher
Effective Tax Rate
• Material fluctuations in currency (particularly US Dollar, Sterling and Euro)
affect reported profitability
• Challenge by tax authority on application of tax law
Actions taken to manage risk
• Debt facilities refinanced to provide additional headroom and covenant
ratios monitored monthly
• Access to capital markets
• Robust stress testing and sensitivity analysis when valuations and
assessments for financial reporting are reliant on uncertain
macroeconomic environment
• Financial control framework in place and oversight of brand financial
reporting at Group level
• Debt is borrowed in various currencies to mitigate FX cashflow and
leverage covenant risk
• The impact of movements in US Dollar and Euro currencies is calculated
and reported to investors for transparency
• Approach to foreign exchange risk is set out in Note 29 to the financial
statements on page 180.
• Full, accurate and timely disclosures made in submissions to tax authorities
who we work with collaboratively to achieve early agreement and certainty
on complex matters wherever possible
• Engagement of experts for complex valuation and accounting advice
40
Ascential plc Annual Report 2023 Legal and Compliance
10. Regulation and Compliance
Description
As a global business, we are
subject to different regulations
across multiple jurisdictions.
Operating across this
increasingly complex and
dynamic legal and compliance
environment can lead to fines,
penalties, reputation risk and
competitive disadvantage.
The regulatory landscape can
change, leading to our current
business model becoming less
profitable or unsustainable.
Examples of risks
• Compliance failures could lead to breach of Market Abuse
Regulations, GDPR, anti-bribery or other key legislation
• Breach of data privacy policy
• Evolving sanctions law prohibits transactions with some existing
or potential customers
• Employment law breaches
How we manage risk
• Experienced legal team supported by professional advisers monitor
changes in regulation and emerging best practice in the sector and
in key policy areas
• Formal compliance framework including formal code of conduct
and refreshed compliance training
• Group monitoring and auditing programmes in place
Risk movement
from 2022
Unchanged
41
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Our
people
2023 was a year of great change for our
business and our people, as we navigated
the run-up to the divestments of Digital
Commerce and WGSN. Our priority
through the year from a People perspective
was to guide teams through this change
using clear, transparent communications
from leaders, whilst increasing the visibility
of our benefits offer and our investment
in our people.
As an organisation, we strove for continued
stability and focus for our people, whilst
behind the scenes our management
teams and colleagues in central teams
were working tirelessly on delivering all the
requirements related to the transactions.
The achievement here should not be
underestimated and we are thankful for
all of the hard work and commitment
demonstrated by those involved.
42
Ascential plc Annual Report 2023 Attracting and retaining talent
Recruitment and onboarding
2023 saw further expansion of our workforce through the acquisition
of UK-based Contagious. To help new joiners feel welcome, we
introduced a ‘buddy’ scheme – pairing an existing employee with
a new joiner to enable them to get to know the business through
a peer companion. We are looking to roll this out in 2024 with any
further acquisitions.
We continue to strive to create fair and inclusive recruitment
processes. This year, we included new wording in our adverts
to encourage applicants who may not meet every requirement to
broaden our applicant pool. We held new interview training for
managers, which supported interview best practice and ensured
that they kept diversity, equity and inclusion front of mind through
the hiring process. These initiatives have helped reduce our time
to hire by over half across all hires at Lions and WARC in 2023
compared to 2022, enabling us to reduce candidate journey time
and hire the best people more efficiently.
We continued to develop our work on entry-level talent, with four
‘Creativity in Business’ paid internships and an Apprentice into the
Marketing team. Both these schemes created an immersive
entry-level programme for people wanting to work in the business of
creativity. In both brands, we also hosted 15 work experience
placements and four interns globally, as well as offering professional
study support to new colleagues. We will look at how we can expand
on this in 2024.
In a year of great
change, strong
leadership voices
are essential.”
Learning and development
We are committed to embedding a learning culture at Ascential.
To do this we offer all staff access to a variety of training opportunities
through a combination of online learning and tailored on-demand
training. 2023 saw an expansion in both of these areas, with a
marked increase in instances of face-to-face training as well as
securing investment in a new content library and upgraded
online training offer.
We supported our people leaders at all levels through our
company-wide Manager Training Series, scoring 100% on
“effectiveness” from attendees across the sessions. Requests for
professional skills training across Ascential resulted in a series of
webinars, reaching over 850 staff globally.
In 2023, we delivered presentation training to 200 colleagues
to maximise the impact our colleagues have on stage – both at
our events and partner events. We delivered tailored 1-1 media
training to increase key staff’s confidence in communicating
effectively with journalists and delivered team building training to
10 teams. Investment in a sales training programme meant that we
supported over 100 sales colleagues globally with brand-specific
sales training days.
Communication and engagement
Strong leadership communication
In a year of great change, strong leadership voices are essential.
In 2023, we guided our people through the ongoing strategic
review with clear and consistent communication from leadership.
We empowered our divisional leaders to speak to company-wide
changes, such as separating our technology platforms, and other
key touchpoints related to the separation activity throughout
the year.
We continued to cultivate our company community through video,
email, our key collaboration tool Slack, in-office activations, and global
in-person celebrations at the company Awards. We also put particular
emphasis on our people communication, sharing quarterly feedback
newsletters, and raising awareness of our benefits offers.
43
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Our People continued
Building culture
Values & actions
Our four values underpin everything we do as an
organisation. They act as a north star for our people
and a lens through which we make decisions:
Creativity – We value and reward innovation,
providing new products and services to our
customers, and finding new ways of working
within our business.
Fairness – We build strong, ethical relationships
based on mutual respect and trust.
Empowerment – We trust our teams to act swiftly
and independently to meet our customers’ needs.
Focus – We prioritise clarity and focus to deliver
high quality outcomes. We are content to do a few
things exceptionally well.
They come together with our four brand actions to form a
clear articulation of our culture. Our actions indicate clearly
how we operate, how we deliver for customers and, simply,
how we get things done at Ascential.
• We never miss a beat – We stay alert to the world. We
are inquisitive, curious and aware.
• We get to the heart – We bring clarity to every situation
by focussing on what matters most. Always with
warmth and a human touch.
• We raise the bar – We strive for the highest standards
and integrity in everything we do.
• We make magic happen – With creativity, innovation
and adaptability, we pull off the incredible.
Feedback
We have been using Peakon since July 2022 to allow us to get
feedback from our people on a monthly basis. The survey covers
employee engagement, diversity & inclusion and health & wellbeing.
Our overall engagement score (from Peakon) for 2023 was 7.5/10
compared to 7.9/10 in 2022. We believe the year-on-year dip was
mainly due to uncertainty about separation and activities around
this which had an impact on how engaged people felt at the
organisation. We also saw a decrease in the amount of people
completing the survey over 2023 which has an impact on our
overall score. We are taking necessary action to ensure that both
of these areas will be improved upon in 2024.
Each quarter we provide our people a round-up of what we are
hearing from Peakon. This feedback from our colleagues has
helped with a number of our people-based decisions such as help
shaping the selection criteria for the new New York and London
offices. We have continued our current hybrid working model
(mixing in-office and at home working) as our people have
continually expressed the importance of being able to work
remotely when they want. In 2024 we will be introducing new
reward and recognition incentives to all employees which we
hope will be received positively and increase our scores.
In 2023 we have also continued with the Ascential Forum, which is
chaired by Rita Clifton, Senior Independent Director. The purpose
of the Forum is to allow employees to share their views and ideas
directly with a Board member across three issues: strategy,
performance and culture. The Forum met twice in 2023, with the
second forum being refocused on discussing people recognition
at Ascential in 2024. Rita Clifton reports to the Board following each
Forum meeting to share employee feedback with all Board members,
giving all Directors better context on how their decisions might
impact our people. We plan to continue with these forums in 2024.
In Q4 Philip Thomas led a series of listening groups with employees
to hear their feedback first hand, to understand their experiences of
Ascential, what they feel we do right, what could be improved, and
what they would like Ascential to communicate to our people. The
key themes from these sessions were colleagues’ appreciation of
flexible and hybrid working, wanting to connect regularly with
colleagues at events, the opportunity to do more cross-brand
collaboration and their enthusiasm for being involved in creating
the future of the Company.
Recognising talent
In March 2023, we held annual awards to celebrate the great
work our colleagues achieved in the prior year across Lions, WARC,
Money20/20, WGSN and our central teams. Celebrations were held
in each of our major locations, with 28 individuals and 31 teams
recognised across 16 categories.
Our Elite Awards recognition programme also continued in the first
half of 2023, recognising performance on a quarterly basis. We
paused the progress in the second half of the year as we focussed
on separating the businesses and reviewing how we recognise
colleagues in the future.
44
Ascential plc Annual Report 2023
Ascential plc Annual Report 2023
45
45
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Our People continued
Our People continued
Valuing the diversity of our people
As an employer, we understand the immense value in embracing
a wide spectrum of perspectives and life experiences, benefiting
both our workforce and customers. At Ascential, we prioritise
attracting, retaining, and developing talents from all walks of life,
ensuring an environment where each individual feels empowered
to authentically express themselves. We firmly believe that this
approach not only secures a sustainable future for our organisation
but also generates a positive ripple effect, benefiting our people,
customers and society at large.
Establishing structure and governance
In 2023, we empowered each division to institute and implement
governance frameworks dedicated to Diversity, Equity and
inclusion (DEI). These frameworks are specifically crafted to align
with the distinct structures of each division, aiming to address the
priorities of both our colleagues and customers. In addition to
division-specific delivery structures, we also make certain that
our plans are tailored to our various regions, recognising and
accommodating the unique nuances and priorities inherent
in the cultures we operate within.
This work is supported by our Equal Opportunities Policy. This
policy serves as a steadfast guideline, explicitly prohibiting any form
of discrimination based on race, colour, religion or belief, pregnancy
or maternity, marriage or civil partnership status, gender or gender
reassignment status, sexual orientation or sexuality, sex, ethnic or
national origin, genetics, disability, or age. At Ascential, we are
dedicated to creating an environment where diversity is celebrated
and discrimination has no place.
Our annual report on diversity, equity and inclusion outlines our
vision, initiatives, and commitments for the forthcoming year,
underscoring the progress achieved to date. 2024’s report will
be published in Spring 2024.
Providing the right tools and support
We are continually working to create a safe, inclusive culture
at Ascential, aligned with our Code of Conduct. This year we
partnered with Catalyse, a leading non-profit organisation
focussed on inclusion and safety in the workplace, to roll out
“Respect@Ascential” training for senior leaders and managers.
The interactive workshops resulted in an increase in confidence
for our participants in dealing with potentially challenging situations
in the workplace around the area of sexual harassment and bullying.
The language and tools from these sessions are regularly used
in further communication to managers.
In addition, we held brand-led training on psychological safety
for managers and leaders and regularly conducted mitigating bias
and inclusive hiring training.
Alongside our training, policies and overall vision and commitments
we set centrally, we also support our Employee Resource Groups
(ERGs). We currently have three ERGs: Black in Business, EmPower
(Women’s Network) and Ascential Pride. These groups are run by
volunteers across the business who represent and advocate for a
particular community of people within the company. Following the
separation of the business, we will be relaunching the ERGs in 2024,
including a new group ‘Able to Thrive’, which focusses on
enablement & wellbeing for people with disabilities, including
long-term health conditions and mental health conditions and
neurodivergence. Alongside our ERGs we also have Network Groups
Latinx, Shalom Ascential and Christian Network who come together
to share and celebrate culture and meet like-minded colleagues
across the business. Our ERGs have organised events throughout
the year to engage colleagues including Empower hosting Shola
Kaye’s “Empathy Talk” and sessions focussed on Future Leaders
Career Advice for woman at Ascential on International Women’s Day,
Spotlight Stories from colleagues across Ascential for Pride Month
and Black in Business hosting an in-person event celebrating Black
History Month UK in October 2023. This was attended by over 60
colleagues in our London office.
Measuring our progress
Our yearly report on Diversity, Equity & Inclusion details the
advancements made towards our 2030 targets.
Our overall Inclusion score within our people engagement score
is in line with our benchmark. We monitor this score closely,
assessing scores for different demographic groups to ensure
consistency of experience for all our people, regardless of race,
colour, religion or belief, pregnancy or maternity, marriage or civil
partnership status, gender or gender reassignment status, sexual
orientation or sexuality, sec, ethnic or national origin, genetics,
disability or age.
DEI data
We continue to monitor our colleague diversity data whilst
remaining compliant with the GDPR requirements. Our employee
diversity demographic data is analysed on a quarterly basis. HR
representatives from each brand/division are provided with this data
at an aggregated level to benchmark their progress towards a
representative workforce within their brand. We have seen increased
disclosure rates since the analysis was first undertaken. Due to the
100% disclosure rate of gender, we are able to perform Gender Pay
Gap analysis to assess any potential pay gap within our business.
The most recent pay gap analysis from 2023 is available in our
Gender Pay Gap Report to be published in April 2024.
46
Ascential plc Annual Report 2023 As at 31 December 2023, Ascential’s overall gender split was
58% women , 41% men and 1% non-binary or transgender. As a
comparison this data for Ascential’s continuing operations (as at
28 February 2024) is a gender split of 60% women and 40% men.
This is consistent with prior years. The figures below show that
we need to continue to focus on gender diversity within our
teams. You can view further details on our plans for this in our
2024 Diversity, Equity and Inclusion report, which will be
published later this year.
Board
As at 31st December 2023
(10 people)
Board
As at 28 February 2024
(7 people)
60% women
40% men
71% women
29% men
Executive
As at 31st December 2023
(12 people)
Executive
As at 28 February 2024
(7 people)
25% women
75% men
43% women
57% men
Senior Leadership
As at 31st December 2023
(78 people)
Senior Leadership
As at 28 February 2024
(31 people)
32% women
68% men
38% women
62% men
Health and safety
Ascential’s Health & Safety Policy was updated and republished in
January 2023 and our safety governance structure has continued to
work effectively throughout the year. The Safety Committee meets
quarterly, as well as providing oversight throughout the year, and
our Safety and Wellbeing Champions have been actively involved
with the management of local issues. Newly acquired businesses
are integrated into our health and safety ‘duty of care’ framework.
We safely delivered our live events in Amsterdam, Cannes and
Las Vegas with no major health & safety incidents. Preparations
are well underway in relation to our newest event in Bangkok
in April 2024.
In 2023, we launched revised DSE (display screen equipment)
training via iHasco which is easily accessed by existing employees
and new starters. We also conducted a Resilience Audit as part of
our internal audit plan (carried out by a specialised team from EY).
The final recommendations arising from the audit will be in place in
advance of the Bangkok event. We have over 24 Mental Health First
Aiders across the business who have been trained by the official
Mental Health First Aid body to spot the signs and symptoms of
mental ill health, provide first aid and act as a confidante for their
colleagues across the business.
Adapting for the future
As we move into 2024, Ascential has clear plans in place to build on
our strong heritage and to continue to be an employer of choice.
We were pleased to be able to bring people together at the end of
January 2024 to talk about ‘What’s Next’ and reinforce our vision,
strategy and plans for the future as a standalone events-led
business. This was an important moment for all of our colleagues
but particularly for those who joined the business in 2023, our
Contagious colleagues who joined in August 2023 and our
international colleagues. We value these moments where we all
come together as a company and the power of human connection
is strongest.
47
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Section S172
Statement
Section 172 of the Companies Act 2006
requires Directors to act in a way that
promotes the success of the company
for the benefit of shareholders as a
whole, whilst having regard to the
interests of its other stakeholders.
Effective stakeholder engagement helps us gain a better
understanding of the impact of our decisions on stakeholder
interests as well as understanding their needs and concerns.
By understanding our stakeholders, we can factor into Board
discussions the potential impact of our decisions on each
stakeholder group and consider how best to act fairly between
members as a whole.
We consider our key stakeholders to be our customers, our
people, our suppliers and business partners, our investors and
wider society.
Our values, set out on page 44 are closely aligned with the
principles underpinning Section 172, ensuring that the way we
do business is consistent with the matters the Directors must
consider as part of their Section 172 duties. The Board recognises
that the interests of stakeholders are sometimes conflicted and
at times, certain interests may have to be prioritised. As part of
the Board’s decision-making process, the differing interests of
stakeholders are considered by the Board and an assessment
is made of the impact and consequences on stakeholders
of decisions in the long term.
48
Ascential plc Annual Report 2023 During 2023, the Directors have considered the matters set out in Section 172. Further detail on how the Board has considered each
factor can be found in the following sections:
A
B
C
D
E
F
The likely
consequence of
any decision in the
long term
The interests of
the Company’s
employees
The need to foster
business relationships
with suppliers,
customers and others
The impact of the
Company’s operations
on the community and
the environment
The desirability of the
Company maintaining
a reputation for high
standards of business
conduct
The need to act fairly
as between members
of the Company
Relevant disclosures
Chief Executive’s
review
Page 6
Our people
Page 42
Business model
ESG – social impact
ESG Strategy
Page 10
Page 71
Page 56
Chief Executive’s
Review
Page 4
Strategic priorities
Page 7
Diversity, equity and
inclusion
Page 46
Third party code
of conduct
Page 75
Climate change
resilience
ESG – Compliance
Framework
Chair’s Introduction
Page 82
Page 59
Page 73
Principal risk
disclosure
Page 32
ESG – social impact
Modern slavery
TCFD statement
Page 71
Page 77
Page 61
Internal Controls
statement
Annual General
Meeting
Page 99
Page 128
ESG – Environmental
Climate Resilience
Whistleblowing
policy
Whistleblowing
policy
Page 59
Page 77
Page 77
Stakeholder
engagement
Page 48
Section 172 in Focus
Below we have set out an example of how the Board has taken into account Section 172 factors in key decisions in 2023.
Sales of WGSN and Digital Commerce
S.172 criteria considered: A, B, C, E, F
Relevant stakeholders: customers, our people, suppliers and business partners, and investors
• The sale of WGSN to funds advised by Apax Partners
• Shareholders will also continue to own Ascential’s market-
and Digital Commerce to Omnicom Group Inc (the “Sales”)
were key agenda items of the Board this year.
• The Board oversaw a comprehensive and competitive sale
process for WGSN and considered the merits of different
strategic options for Digital Commerce. The Board concluded
that the Sales would realise an attractive valuation for Digital
Commerce and WGSN, unlocking the sum of the parts
valuation discount applied to Ascential’s portfolio businesses.
• The Board further concluded that the Sales would benefit
the customers, employees and partners of each business as
the new owners would enable each business to flourish and
better position them to achieve their growth ambitions.
• The Board consulted the Company’s largest shareholders in
reaching a decision to return a significant proportion of the
proceeds of the Sales to Shareholders.
leading Events business which will be positioned to capitalise
on strategic growth opportunities in the markets that it
serves, driving significant long-term value for shareholders.
• The Board reviewed and was satisfied that there would be no
material adverse effect on the retained Group as a result of
the Sales to ensure sufficient protection for the Company’s
key stakeholders.
• The Board approved the Sales and considered that they
were in the long-term interest of all its stakeholders.
49
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Section S172 Statement continued
Stakeholder
engagement
Our key
stakeholders
Our partners
& suppliers
Our
customers
Wider
society
Our
people
Our
investors
50
Ascential plc Annual Report 2023 Our customers
We help our customers to
make smart strategic decisions
that improve performance now
and in the future, enabling them
to outperform their competitors.
Customer forums & feedback
How we engage
• We regularly engage with customers across our product
brands and geographies. Our account management and
client service functions are in regular contact with customers
to ensure they get the best value from our services.
• We run Net Promoter Score (“NPS”) surveys across
the majority of our brands.
• We conduct research on a project basis in advance
of major product developments.
Outcomes from engagement
NPS scores are shared across the business, leading to the
ongoing development of marketing, product and content
strategies that take into account customer feedback.
At our events, the content topics and themes have been
directly informed by qualitative and quantitative research
and NPS surveys.
51
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Section S172 Statement continued
Our people
We have an experienced and dedicated
workforce which we recognise as a key
asset of our business.
Key tenets of making Ascential a great
working environment include an emphasis
on personal wellbeing, investment in
learning and development, support for
flexible working, a focus on diversity and
inclusion in everything we do, and open
and honest leadership communications.
Health and Safety
How we engage
We have a wide range of formal and informal communication
channels on safety issues:
• Any employee can report a safety concern or incident via
their line manager.
• Anyone can report in person or anonymously via the
‘Speak-Up’ function.
Internal communications
How we engage
• We guided our people through the strategic review changes
with clear and consistent communication, sharing leadership
updates for each division at all major transaction milestones,
and ensuring that our people were kept up to date with the
strategic review process. All communications were stored on
an internal site, the ‘Change Hub’, so our people could easily
access key information.
• We ran Town Halls for each division, with Q&A sessions,
to ensure a two-way dialogue between our people and our
senior leadership, ensuring that all voices had the
opportunity to be heard.
• We have regular internal communication with our people
via email, Slack and video, updating our people on company-
wide news, sharing leadership updates and running internal
events, such as annual awards and end-of-year parties.
Outcomes from engagement
We create surveys after all of our key internal events.
The survey results and verbatim feedback that we get from our
people informs the planning of our future events, ensuring that
our people feel that their opinions are valued and acted upon.
Building a dialogue with our people
• Safety Champions are nominated across every brand to
represent any local issues on behalf of their colleagues.
How we engage
• We use employment engagement surveys, which, along
Internal communications support the delivery of information
campaigns on specific topics.
For health & wellbeing we have specific questions in our
engagement survey that relate to this and we actively look
to act upon the feedback we receive.
In 2023 we have embedded new health and safety training
via a recognised provider.
Outcomes from engagement
Our colleagues continue to value our flexible working
arrangements as demonstrated by our engagement feedback,
along with positive scores in relation to employee wellbeing.
• We score 8.5/10 for the statement ‘I have the option to work
remotely when I’d like to.’
• We score 7.6/10 for the statement ‘Employee health and
wellbeing is a priority at Ascential.’
Feedback has also helped to inform our new office strategy
and define the space that we require.
Our new training platform has meant that colleagues have
access to the right information to work safely in any home
or office location.
with face-to-face feedback help us understand what people
think, any issues they may be having and what they want to
achieve in their careers. Our HR business partnering team is
embedded in each of our two Divisions ensuring that the
People agenda is focussed on the unique needs of each of
our brands. This has enabled us to provide targeted HR
support and build People plans aligned to the strategy of
each Division.
• We use an instant messaging and collaboration tool, Slack,
which is used for one-to-one messaging, company
announcements and team projects.
• We track engagement on internal communications emails
and global announcement Slack channels to provide insight
into message activity and open rates.
•
Internal interviews with our senior leadership team frequently
include an open Q&A session, with sessions recorded and
shared thereafter.
• The Ascential Forum is chaired by our Senior Independent
Non-Executive Director, Rita Clifton, and gives employees the
opportunity to share their views and ideas directly with a
Board member.
52
Ascential plc Annual Report 2023 Outcomes from engagement
• We continue to use Peakon on a regular basis to gather data
and insight on how our employees are feeling across a wide
range of questions enabling more direct action to address
any concerns or issues. Our engagement scores remain in
line with benchmark scores.
• Rita Clifton, our Senior Independent Director, updates the
Board following each Ascential Forum meeting to provide
a direct route for the employee voice into the Boardroom.
Diversity & Inclusion
How we engage
• Since the start of 2021 we have published an annual Diversity
and Inclusion report which includes a clear vision for our
work in this space, a set of 2030 global commitments and
annual objectives, along with a progress report against the
previous year’s objectives. These reports provide an update
on where work is going well and where further effort is
required, demonstrating our commitment to being honest
and open in order to share learning.
• Following the departure of our Chief Operating Officer, Paul
Harrison, Philip Thomas steps into the role of Board-level
representative on Diversity and Inclusion, as part of ESG overall.
Nancy Parks, Chief People Officer, is the Executive Sponsor
for DEI. These roles are supported by our Head of Employee
Experience and Culture who leads on DEI across the Company.
This role is then supported by a wide range of colleagues
across the Company who take the lead on DEI projects where
required. The Ascential Forum also serves as a valuable
feedback mechanism on DEI initiatives when required.
• Our regular engagement survey includes a standard
set of DEI questions. The functionality of the survey tool
enables us to analyse inclusion scores through a range
of demographic lenses.
Outcomes from engagement
Our average score throughout the year indicates that our
inclusion scores remain within sector expectations.
Our overall inclusion score is 8.0/10 which includes the
question ‘I’m satisfied with Ascential’s efforts to support
Diversity and Inclusion, (for example in terms of gender,
ethnicity, disability and social-economic status).
Our Diversity & Inclusion report sets out our ambitions in this
space: we have work to do in a number of areas of representation
with a particular focus being on diversifying our leadership
teams. The report sets out our specific targets and objectives.
Colleague networks & forum
How we engage
• We have three Employee Resource Groups: Ascential Pride,
Black in Business and Empower, our women’s network. All are
colleague initiated and led, supported by a central toolkit,
budget and the HR team. In addition they all have Executive
sponsors to ensure they have a voice of influence at Senior
Leadership level.
• Lions appointed a VP, DEI to drive progress in this critical area
for their business, externally and internally.
Outcomes from engagement
We continue to support our networks and use them as counsel
for projects including HR policy review and overall strategy
design. This engagement strategy has contributed to the
following scores from our engagement surveys:
• We score 8.3/10 for the statement ‘I believe Ascential would
respond appropriately to instances of discrimination’.
• We score 7.8/10 for the statement ‘People of all backgrounds
have the same opportunities at Ascential’.
• We score 7.7/10 for the statement ‘Recruitment
processes at Ascential attract and select a diverse workforce,
(for example in terms of gender, ethnicity, disability and
socio-economic status.)
53
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements Section S172 Statement continued
Our investors
Our investors value sustainable
growth, responsible capital allocation
and investment decisions, and clear
communication of strategy, supported
by robust financial reports.
Our partners
and suppliers
Our partners want us to work
with them to develop productive
and fair working relationships,
with fair terms of business and
fair payment terms.
How we engage
• We hold a range of Investor meetings throughout the year
including post-results roadshows, investment conferences
and on-demand individual meetings, totalling over 200
engagements in 2023 covering over 100 institutions (both
holders and non-holders).
• We deliver twice-yearly analyst results presentations, as well
as holding additional meetings and calls throughout the year,
totalling around 100 interactions in 2023, across our coverage
base of seven analysts.
• We hold an Annual Capital Markets Day for our coverage
analysts and major holders, to provide more granular detail
on our progress with strategy, performance and future plans.
In 2023 this focussed on the continuing businesses, their
capabilities, business models and addressable markets.
We hold an Annual General Meeting which all shareholders
are welcome to attend and ask questions of the Board.
In 2023, following the announcement of the sale of the Digital
Commerce and WGSN businesses, we consulted extensively
with shareholders on the optimal mechanism for the return of
£850m of value from these sales.
Outcomes from engagement
We provide the investor community with clear updates on
our trading performance and strategic direction. Analysts
and investors have the opportunity to give feedback to
management on the above and engage in Q&A.
How we engage
• We hold Quarterly Business Reviews with all key suppliers
to review progress on key activity as well as sharing business
updates and strategy.
• We operate and publish a Third Party Code of Conduct
which sets out the key ethical and business principles we
look for in all third parties we work with.
• We operate a prompt payment policy and disclose our
payment practices and performance via the UK Government
payment practices reporting portal.
Outcomes from engagement
We listen to feedback from suppliers about any challenges in
engaging with us to continuously improve the way Ascential
operates with its supply chain.
We are implementing a Carbon Data Capture Policy –
Environmental Policy in our Events supply chain. This sets
out the expectations and requirements for suppliers to our
live events to provide accurate and detailed environmental
data, to support Ascential in measuring the carbon footprints
of our live events.
54
Ascential plc Annual Report 2023 Wider society
We believe that it is important to
adhere to evolving ESG best practice.
A crucial aspect of this is having a
realistic understanding of the impact our
business has, the issues our customers
care about, and therefore where we can
play our part in delivering positive change.
Once we understand this we can prioritise
resources and activity accordingly.
How we engage
• Our brands are enabled to engage and support charities,
community groups and third sector organisations which
align with colleague and customer values and priorities.
You can read more about this and the specific example
of our partnership between Lions and the Sustainable
Development Goals on page 71.
• Both Money20/20 and Lions continue to deliver programmes
which seek to improve the diversity of the industries in which
they operate. These programmes include Money20/20’s Rise
Up Programme and Lions ‘See it Be it’.
• We continue to work with partners on our Early Talent
opportunities. These include Multiverse who are our
Apprenticeship provider and Creative Access who support
Internship recruitment in the UK. Creating opportunities for
Early Talent creates opportunities for engagement in the
local communities in which our offices are based and
creates a diverse pipeline of talent.
• Our global policy gives all employees one day per year
to volunteer at local community projects. Over the past
two years we’ve moved from a central theme for those
volunteering days to encouraging brands to deliver the
opportunities that most resonate for them. This means that
our colleagues are now supporting a range of projects
around the world.
• We have had a long-standing relationship with The Prince’s
Trust, fundraising as part of the Million Makers competition,
and sponsoring the Educational Achiever award for the sixth
year of the annual Prince’s Trust Awards.
Outcomes from engagement:
• We have raised over £2.5 million for The Prince’s Trust
in the past 11 years.
• Both the Glass Lion and the Sustainable Development
Goal Lion, as part of our Lions Awards have raised awareness
in our industry of core issues for the sectors in which we
operate and championed positive behaviour change.
• You can read more about the outcomes from our
engagement work in our ESG section on page 71.
Amount raised in 2023 for
The Prince’s Trust
£0.4m
Money20/20 USA’s 2023 Rise Up & Amplify cohort
55
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements ESG
strategy
As I take on the role
of Chief Executive for
Ascential, I also take on the
role of Board ESG Sponsor.
Delivering long-term,
sustainable success is
my core objective for
the Company and I am
confident that our focus
on ESG will set us up
well for the future.”
My ambition is that we can be one of the most sustainable
events-led businesses in the world.
Our ESG approach at Ascential has always been to consider the
way we do business and the impact we have on the environment,
community and society. We reviewed this again in 2023 in light of
the disposals of Digital Commerce and WGSN and updated our
materiality assessment. While our social and governance work
remains material, it is increasingly embedded in our operations.
Therefore our main focus in 2023 and going forward into 2024 is
our environmental strategy, as we know it is a critical issue for our
people, our customers, our shareholders and our planet.
Our commitment is to minimise our carbon emissions and
maximise the opportunities to raise awareness of the climate crisis
with our people and our customers, through our events, digital and
advisory products.
We acknowledge that this is an ongoing journey to make each of
our events the most sustainable they’ve ever been. We will only
achieve this through establishing long-term goals and intentions
and taking consistent and deliberate action. This is the same
approach that we have used in our diversity, equity and inclusion
work, which has resulted in progress in representation on stage, in
our content and in our business. It’s this approach which will see us
launch our Sustainable Event Standards in 2024. A set of long-term
ambitions, with near-term metrics, which will significantly reduce
the carbon emissions and waste at our events.
Underpinning progress in all areas of ESG is a culture of constant
learning, with our core internal team bringing in the experts where
needed to establish a solid foundation for action. You can read
more about the long-term goals that we are developing, along with
the targets for immediate next steps in the following section.
I look forward to keeping you updated on progress.
Philip Thomas
Chief Executive
ESG Board Sponsor
25 March 2024
56
Ascential plc Annual Report 2023 ESG Overview
Aim
To do business without negatively impacting
the environment, community, or society
Environmental
Ascential Sustainable
Events Standards
Carbon
Transition Plan
Carbon Emissions
Measurement
Social
DEI Strategy
Charity Partnerships
Community
Engagement
Governance
Employee Code
of Conduct
Third Party Code
of Conduct
Compliance
Framework Policies
Employee Engagement:
retention and
productivity
Client Engagement:
retention and
acquisition
Investment and
investor
engagement
Sustainable
Operations
Materiality
Following the disposals of Digital Commerce and WGSN in early 2024,
we updated our materiality assessment to identify the ESG topics that
are most important to our ongoing business. This assessment has
informed the ESG priorities for Ascential moving forwards.
Many of the topics remained material since our previous
assessment. However, as we transition to an events-led
business, event waste and emissions have received a
higher score.
We identified 24 topics that are most relevant to Ascential. Key
stakeholders from across the business provided input on the
severity and likelihood of the impact as well as their assessment
of Ascential’s current operational ability to manage each topic.
Topics that were rated an average of over 4 out of 5 in either
severity or likelihood were considered material. Further analysis
was completed to assess the timeframe in which the impact is
expected and the confidence in our business operations to deal
with these impacts.
Our material topics are listed below, along with details of where
further information is provided about them throughout this report.
We will continue to review our material topics annually to ensure
our priorities align with the changing landscape of the markets
we operate within and the wider community we serve. We
commit to conducting a full re-evaluation of the materiality
assessment every two years, or in the event of substantial
change to the business.
Sustainalytics ESG risk rating
Sustainability score
NEGL
LOW
MED
HIGH
SEVERE
INSUFFICIENT
PARTIAL
GOOD
ADVANCED OUTSTANDING
ESG rating
Score
CCC
B
BB
BBB
A
AA
AAA
D-
D
C-
C
B-
B
A-
A
57
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements ESG strategy continued
ESG Area
Material Topics
Further Information within reporting
Environment
(page 59)
• Carbon Emission Reporting and Reductions
• SECR (Page 68, TCFD (Page 61),
• Event Waste and Emissions
• Sustainability at our events (Page 60)
• Adaptability to changing market needs
• Sustainability at our events (page 60)
• Sustainability in our content (page 60)
• Sustainable Supply Chain
• TCFD (page 61), Supplier Code of Conduct (Page 75)
Social (page 71)
• Diversity, Equity and Inclusion (DEI) in
• Gender Pay Gap Report 2024, DEI Report 2024
– our workforce
– our content
Our People (page 42)
• Content and Speaker Audit (page 72)
Governance
(page 73)
• Employee Satisfaction and Retention
• Our People (page 42)
• Charity Partnerships (page 71)
• Risk Management
• TCFD (Page 61), Risk Management (Page 32)
• Data Security, Protection and Privacy
• ESG Compliance (page 76)
• Compliance with ESG regulations
• ESG Compliance (page 76)
• Compliance & Business Ethics
• Code of Conduct, Third Party Code of Conduct, Modern
Slavery, Health & Safety Policy, Compliance Framework, ESG
Policies (all found on pages 73 to 79)
• Audit Committee Report (page 94)
58
Ascential plc Annual Report 2023 Environment:
Climate Resilience
In 2023 we improved our carbon
measurement methodology and
implemented a new data management
tool for measuring our emissions. The
environmental material topics identified
as part of the materiality assessment,
along with the results of our carbon
measurement resulted in the development
of our environmental strategy and the
identification of four key goals; Carbon
Reduction, Waste Reduction, Sustainable
Supply Chain and Renewable Energy.
Aim
To do business without negatively impacting the
environment. Supporting the environment in which we
operate to thrive, ensuring the conditions in which our
business can also thrive.
Strategy
Our current Sustainability Strategy will develop into our
Carbon Transition Plan over the next two years.
Goals
Enablers currently in place
Enablers to be established in 2024
Carbon Reduction
• Leadership Accountability
• Ascential Sustainable Events Standards
• Carbon Measurement
• Science-Based Targets (for verification in 2025)
• Upskilled and equipped team
• Costed Transition Plan (for completion in 2025)
•
Increased proportion of activity-based Scope 3
carbon measurement
Waste Reduction
• Leadership Accountability
• Ascential Sustainable Events Standards
• Waste measurement
• Upskilled and equipped team
Sustainable
Supply Chain
Renewable Energy
• Supplier Environmental Policy
• Upskilled and effectively resourced procurement team
• Responsible sourcing policy
• Ascential Sustainable Events Standards
• All new offices to be supplied with renewable energy
Progress made in 2023:
•
Increased carbon measurement to include spend-based
scope 3 emissions reporting, alongside the scope 1 and 2
measurement we have conducted for the past seven years.
For details related to our carbon emissions, reduction targets
and progress for 2023, see our TCFD report on page 61, and
our SECR report on page 68.
• Measured the carbon and waste footprints of our Cannes Lions
Festival of Creativity, as well as our Money20/20 events in
Amsterdam and Las Vegas. For further details on the actions
we’ve taken at our events see page 60.
• Sustainability continues to be a focus within our content, both
at our events, and accessed through our digital platforms and
advisory services.
•
Increased the sustainability awareness of our workforce through
engagement and training opportunities.
59
Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements ESG strategy continued
Looking forward to 2024:
• Launch the Ascential Events Sustainable Standards.
The standards, developed during 2023, are a roadmap
for significantly reducing the carbon emissions and waste
generated at our events year on year. It sets us on a pathway
to collaborate across our industries, and with our supply chains,
to deliver some of the most sustainable events.
• Set carbon reduction targets for scope 1 & 2 which are aligned
with the science-based target initiative (SBTi).
• Continue to maximise the opportunities to raise awareness of
the climate crisis with our people and our customers, through
our events, digital and advisory products.
• Begin developing a costed Climate Transition Plan to outline our
roadmap to net zero in line with UK Government guidelines.
• Continue to increase the level of supplier-specific scope 3 data
available in order to set further emissions reduction targets.
• Continue to measure the carbon footprint across all our events,
adding in Money 20/20 Asia and Contagious events to the
existing measurement cycle.
• Achieve targets set out in the TCFD statement on page 61.
• Continue to upskill and equip our colleagues to enable further
progress on meeting our sustainability goals.
Event sustainability
Sustainability in our event operations is a priority for the business
moving forwards. We consider our positive impact in three ways:
how we run our event, the impact of our content, and how we
work with suppliers and partners.
How we run our event
A key enabler to running a more sustainable event is to calculate
the carbon and waste footprint of each event. This enables us to
set targets for carbon reduction and measure our progress against
those reduction goals. In 2023, we improved the methodology to
measure the carbon footprint of the Cannes Lions Festival of
Creativity, as well as footprinting our Money20/20 events in
Amsterdam and Las Vegas for the first time.
In 2023 we appointed a new partner, isla, a non-profit organisation
founded by event professionals and industry leaders focussing on
a sustainable future for events. Together we have measured the
carbon emissions of our event operations, created meaningful
targets and developed our sustainable standards that establishes
the roadmap for sustainable event operations across our portfolio.
We also engaged with our top-contributing suppliers to capture
the emissions related to our event activities including energy, built
production, graphics, food and drink, waste management, event
transport, and staff travel and accommodation.
In 2023, suppliers were selected based on the materiality of their
contribution to the events. We intend to increase the coverage
of suppliers each year in order to increase the accuracy of
our footprints.
We will continue to footprint our events, including our new Asia
event in Bangkok in April 2024, which will allow us to measure
our progress towards our reduction targets. For further
information on our targets, see page 66.
Actions taken to reduce the footprint of the 2023 Cannes
Lions event included offsetting all staff and jury flights and
implementing measures to reduce waste and energy
consumption, including solar charging stations, placing
water fountains around the venue, and reducing the use of
single-use plastic.
The impact of our content on stage
On the Cannes Lions stages in June, highlights of the scheduled
sustainability content included Patagonia’s Tyler LaMotte on
how to drive the sustainability agenda in practice not theory and
Edelman, with Randi Kronthal-Sacco of NYU Stern Center for
Sustainable Business and The North Face’s Sophie Bambuck,
looking at the business case for sustainability.
Sustainability was also on stage at Money20/20 Europe. These
included a panel with Visa, Grover, Twig and the Ellen McArthur
Foundation called ‘Recommerce or Rubbish’ and a fireside chat
with Zumo and the World Economic Forum on nurturing a more
climate-conscious crypto sector. In addition the event held a
competition for startups to win a $100,000 SAFE note for
Europe’s Got Access; the winner was Zero Labs, a company
which focusses on renewable energy made digital.
In addition to the content on our own stages, we provide space
for industry partners to raise awareness of the positive actions
our industries can take. ACT Responsible has partnered with
Cannes Lions for over 20 years to showcase the work the
advertising industry has done to create positive change. In 2023
they shared their space with Ad Net Zero who provide a
framework for the advertising industry to achieve net zero
How we work with Partners and Suppliers
Our Environmental Data Reporting Policy requires our core
event suppliers to provide the data needed to carbon footprint
our events. Working in partnership with our suppliers to gather
this data enables us to work with our supply chain to achieve
the carbon reductions we all require.
Our Green Guide for partners and suppliers supports them
to make sustainable decisions for their activities at our events.
Our partnership with GreenBee Event Upcycling, a not-for-profit
association based in Cannes, aims to promote the reduction of
various waste materials linked to the event industry.
60
Ascential plc Annual Report 2023 Taskforce for Climate-
Related Financial
Disclosures Statement
The following statement includes climate-
related financial disclosures consistent with
the recommendations of the Task Force
on Climate-related Financial Disclosure
(TCFD). Climate Change is widely recognised
to be one of the main global risks affecting
business. We know that transparency
regarding climate-related risks and
opportunities is critical to maintaining the
trust of all our stakeholders and allows our
investors to better understand the implications
of climate change for our Company.
Last year marked a pivotal moment for Ascential. In December
2023, our shareholders voted in favour of selling Digital Commerce
and WGSN with both transactions completing in the first quarter of
2024. Ascential is now an events-led company, with a focus on two
significant markets: marketing and financial technology. This
transition has necessitated a re-evaluation of our risk profile,
including climate-related issues.
We know that sustainability is a key theme for our customers and
for our people, and we consider that the materiality of climate
change and sustainability-related risks has increased for Ascential
as an events-led company. We have therefore identified climate
change and sustainability as a principal risk (see page 37 for more
detail). As such, we have also committed to an increase in Board
engagement going forward and appointed Philip Thomas, Chief
Executive, as the new Board Sponsor for ESG matters.
We still have further work to do to be fully compliant with all the
TCFD recommendations. We have continued to prioritise climate-
related risks over climate-related opportunities and while we have
identified some new opportunities this year, we need to continue
to develop these opportunities over the short, medium and long
term. We believe that the work planned for 2024 and 2025 to
complete our Climate Transition Plan will result in full compliance
with TCFD within the next two years. As part of developing our
Climate Transition Plan, we will be modelling the resilience of the
Company’s strategy both qualitatively and quantitatively against a
range of climate-related scenarios. To date this work has only been
done on a qualitative 2°C warming scenario.
We began work in early 2023 to develop our Climate Transition
Plan. However, completion of this work was delayed following the
announcement in January of the Board’s strategic review, the
outcome of which could substantially impact the Company’s
material risks and opportunities. Additionally, it became apparent
that in order to set a realistic net zero target and quantify the cost
and implications of achieving that target, the spend-based scope 3
data we collected in 2023 was not sufficient to set ambitious yet
achievable targets. We intend to increase the number of scope 3
categories for which we collect activity-based data in 2024 to
inform our Climate Transition Plan. We have made good progress
during the year with strengthening the methodology for collecting
our emissions data enabling increased transparency and disclosure.
Page 59 provides more details on our progress in this area. We
intend to continue this work in 2024 with a view to completing our
Climate Transition Plan in 2025.
To support the above, and ensure we continue to align with best
practice, we will be working towards assurance of our TCFD
statement and carbon emissions reporting in 2025, likely in the first
instance with our outsource partner for Internal Audit.
Governance:
a. Board oversight of climate-related risks and opportunities
The Board and the Audit Committee have reviewed and approved
the following statement.
The Board has primary oversight and ultimate accountability for
our ESG performance, including the approach and actions taken in
relation to climate-related risks and opportunities. Philip Thomas, Chief
Executive Officer, is the executive sponsor of Ascential’s ESG policy
and we also benefit from the experience of our Senior Independent
Director, Rita Clifton CBE, whose non-profit board experience includes
WWF, the UK Sustainable Development Commission and Green
Alliance. Rita is currently serving as Chair at Forum for the Future,
the leading international sustainability organisation.
In 2023, the Board received its annual update on ESG and approved
the ESG-related priorities for 2024. At the end of 2023, the Board
determined that it will review quarterly ESG dashboards of key
metrics and receive twice-yearly updates from the Head of
Sustainability. The Board also approved the plan to be fully
compliant with TCFD recommendations and to have completed
the Climate Transition Plan by the end of 2025.
The Board reviews climate-related risks and mitigating activity as an
integrated part of its review of principal risks. The Audit Committee
reviews the work management conduct to quantify the financial
impact of climate-related risk and the way it is reflected in the
Group’s long-range financial forecast. The Audit Committee also
annually reviews the effectiveness of the Company’s risk
management processes, which includes the management
of climate-related risks.
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b. Management’s role in assessing and managing climate-related
risks and opportunities.
We have a formal enterprise risk management policy which
governs how we manage risk, including climate-related risks.
The risk management framework includes divisional operating risk
committees, whose membership includes the divisional Chief
Executive Officer and Chief Financial Officer as well as the Chief
People Officer and Chief Technology Officer. See page 32 for more
information on our risk management framework.
We reviewed our assessment of material climate-related risks and
opportunities in December 2023, which included input from the
Executive Directors and the senior leadership team.
Our Head of Sustainability works across both divisions to identify
climate-related risks and opportunities, set company-wide goals,
align activity with identified goals, measure company-wide impact
and also report on progress.
Representatives from across the Company participate
in a cross-company Sustainability Forum, led by our Head of
Sustainability, which meets quarterly and aims to raise awareness
and upskill our colleagues on climate change and sustainability.
Risks and opportunities identified through the Sustainability Forum
and the work of the Head of Sustainability are fed back to the
senior leadership team for consideration and allocation of relevant
resources to realise opportunities and mitigate risks where relevant.
In 2023, we conducted a thorough review of our risk framework
considering the anticipated disposals and the transformation of
our business model. Moving forward into 2024, as we embark on our
next chapter as an events-led business, we will maintain a vigilant
approach to reviewing and adapting our stance on climate-related
risk. This ongoing process will ensure that our risk management
strategies remain relevant and responsive to the changing
business environment.
Strategy
a.
Climate-related risks and opportunities in the short, medium, and long term
Unless stated in the description, all of the following risks and opportunities have been deemed applicable across both the Marketing and
Financial Technology sectors in which we operate, and across all of our geographical regions.
Short-Term Risks: <3 years
Risk
Category
Waste
Transition:
Technology/
Reputation
Description
Impact
Mitigating activity
There is a risk that…
avoidable waste from events
becomes unacceptable for
customers due to its
cumulative impact.
Increased cost or scrutiny
surrounding the waste
generated as part of
business operations,
including event
merchandise.
• Timeframe: Short
• Likelihood: High
• Impact: Medium
Some customers may
become unwilling to be
associated with our flagship
events because of
environmental impact.
The amount and type of waste
produced at all major events has been
measured in 2023, with a view to
setting a baseline and reduction
targets in 2024.
The development of the Ascential
Sustainable Events Standard.
Both Cannes Lions and Money20/20
continue to review and reduce the
volume of single-use products and
waste generated from events.
Associated
Opportunity:
The Ascential Sustainable Events Standard has been developed and will be rolled out in 2024. This Standard sets out the
roadmap for both waste and carbon emissions reduction across all of our events, with measurable annual targets. It
presents opportunities for cost saving in certain areas, innovation in the way we produce our events and over time the
ambition is that it provides a blueprint for the wider industry on best practice in operating sustainable events.
Carbon emissions
measurement and
reduction
Transition
There is a risk that…
as a company we are unable
to measure and then reduce
carbon emissions in line with
EU and UK Government
reporting requirements.
• Timeframe: Short
• Likelihood: Medium
• Impact: Medium
Inability to measure carbon
emissions data means we
are unable to set and
demonstrate reduction in
those carbon emissions and
complete the required ESG
reporting in line with UK and
EU Government
requirements.
Relevant regions: UK & EU
Effectively resourced internal
Sustainability Team composed of a
Head of Sustainability and a Data &
Information specialist manage carbon
emissions measurement and
reporting. The team works in
partnership with a well-established
technology platform to measure
emissions, as well as with an expert
consultancy on reduction plans.
Progress against measurement and
reduction plans is monitored by both
the ESG Exec Sponsor and the Board.
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Ascential plc Annual Report 2023 Risk
Category
Description
Impact
Mitigating activity
Supply Chain
Transition/Physical
There is a risk that…
our supply chain isn’t
equipped to manage
climate-related risk.
• Timeframe: Short
• Likelihood: Medium
• Impact: High
Changing business
model/innovation
Transition: Market
There is a risk that…
Ascential is unable to adapt
and respond to changing
market needs as our
customers work to improve
their own sustainability
performance.
• Timeframe: Medium
• Likelihood: Medium
• Impact: High
Our Supplier Code of Conduct
includes a requirement for our
suppliers to adhere to all applicable
environmental laws and regulations,
and to appropriately mitigate climate
change risk and contribute to
reducing the environmental impact
of their products and services.
In addition we monitor suppliers to
identify those in regions identified
through the ND-GAIN Country Index
as high risk and consider that as part
of the contracting process.
Continue market scanning to inform
Ascential strategy and ensure that we
develop our proposition to respond to
customers’ needs.
Maintain a close dialogue with
customers to monitor changes in
demand for climate-related products
and capabilities.
Without a supply chain
resilient to climate change
there is a risk that key
suppliers become
unavailable to deliver
required products or
services.
Customers experience
climate-related regulatory
increases, and their budget
prioritisation may change as
they experience climate-
related cost increases (such
as fuel, energy licensing,
etc.).
Some customers may be lost
if Ascential lacks the skills to
market its sustainability
credentials effectively.
Associated
Opportunity:
New products and services have been created across our business which address our customers’ requirements on
sustainability. These include the WARC Sustainability Hub, the Lions Sustainable Development Goal Category as part
of our Awards, and increased content on ESG at both Money20/20 and Lions events to address customer demand.
Event attendance
Transition: Market/
Reputation
There is a risk that…
customers perceive
emissions associated with
attending events to be a
barrier to attendance.
• Timeframe: Medium
• Likelihood: Medium
• Impact: Medium
Event-organising
services need to adapt to a
changing market where
flights are expensive, and
participants are increasingly
conscious of the climate-
related impacts associated
with travel.
Demonstrate our credentials as an
industry leader in sustainable events.
Leverage hybrid event offerings.
Reduce or offset emissions associated
with delegate travel.
Medium-Term Risks: 3-15 years
Risk
Category
Business
disruption
Physical: Acute/
Chronic
Description
Impact
Mitigating activity
There is a risk that…
Ascential faces business
disruption, due to global
factors (e.g. large-scale social
unrest) or local incidents
(e.g. property damage from
extreme weather events).
• Timeframe: Medium
• Likelihood: Medium
• Impact: Medium
Compromised ability to
deliver customer services,
resulting in a loss of revenue.
Continue to maintain Ascential’s
business continuity planning.
Climate Change risk is considered
when looking at venue contracts for
events to ensure long-term contracts
are not signed in high-risk areas.
Employees are equipped to work
remotely and from home, should the
office site be unavailable.
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b. Describe the impact of climate-related risks and opportunities
on the organisation’s businesses, strategy, and financial planning;
We continued to consider the materiality of the defined climate-
related risks over FY24 to FY28, which is the period used by the
Board for medium-term planning. The climate- related financial
impact modelling conducted in 2022 continued to be relevant in
2023. For that exercise, we concluded that only some of the
material climate-related risks identified as part of the materiality
assessment would have a material financial impact in the five-year
review period. For climate-related risks considered material, we
identified drivers of the financial impact associated with each risk,
the required mitigating activity and considered in more detail
whether there would be a material impact in a five-year period.
In these cases, costs were incorporated into business plans (e.g.
Cannes Lions) and we continue to manage the information
required to increase the incorporation of this risk into the financial
planning process.
We have been upskilling our divisional Chief Financial Officers
in order for them to gain further working knowledge of what
is required in climate-related reporting and modelling, both in
compliance with TCFD and as part of our Transition Planning.
This will enable the Divisional Finance Teams and the Sustainability
Team to work together to effectively assess the financial impact of
climate-change-related risks and opportunities on an ongoing basis
and build the required modelling into our ‘business as usual’ processes.
c. Describe the resilience of the organisation’s strategy, taking
into consideration different climate-related scenarios, including a
2°C or lower scenario.
As explained in our introduction, this is an area where we have
further work to do to achieve compliance with the full TCFD
recommendations. To date, we have conducted qualitative analysis
only on a 2°C warming scenario. As we develop our Transition
plan over the next 12-24 months, we will be conducting quantitative
analysis against the same 2°C warming scenario to fully understand
the financial implications of climate change over the short,
medium and long term.
Overall, however, we consider that the Company remains resilient
to climate change risk and the impact of a 2-degree warming
scenario is low.
For the qualitative scenario analysis exercise we created a single
pathway to the year 2040 that allowed us to explore how the
material risks and opportunities may develop in the short (<3 years),
medium (3-15 years) and long term (>15 years). Our scenario was
based on 2°C average global warming by 2100 as the most likely
warming scenario, using a combination of projected physical
changes (informed by the Representative Concentration Pathways)
and socioeconomic changes needed to tackle climate change
(informed by the Shared Socio-economic Pathways). The scenario
analysis was designed to explore one potential future and the
results of our scenario analysis have been used to validate our risk
identification and mitigation approach based on this ‘middle of the
road’ future scenario.
Risk management:
a. Describe the organisation’s processes for identifying and
assessing climate related risks
In 2023 a materiality assessment was carried out with input from
across the Group and Brand Leadership teams, the Sustainability
Team and key business leads e.g. Event Directors. The topics
provided for consideration as part of the materiality assessment
covered both transition and physical risks as well as existing and
emerging regulatory requirements related to climate change.
The sections of the scenario analysis mentioned above, which
related to our events portfolio, remain relevant to our ongoing
business. This analysis combined with the results of the materiality
assessment conducted in 2023 informs the identification of
climate-related risk and opportunities. These risks have been
integrated into our enterprise risk management process (please see
page 32 for more detail). Through this process there is the
opportunity to identify both division specific risks and opportunities
as well as those which impact across Ascential.
b and c: Describe the organisation’s processes for managing
climate-related risks and how processes for identifying, assessing,
and managing climate-related risks are integrated into the
organisation’s overall risk management.
The overall process for managing risks, including climate-related
risks, is explained in detail on page 32.
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Ascential plc Annual Report 2023 An overview of Ascential’s approach to assessing and
managing climate risk and opportunities:
Ascential plc Board
• Oversees all aspects of ESG, including climate change resilience, people, equity, diversity and inclusion
and overall governance structures. Ultimately responsible for determining strategy and prioritisation of
key focus areas.
• Supports and challenges management on both setting and monitoring progress against goals and targets.
• Ensures Ascential maintains an effective risk management framework, including over climate-related risks
and opportunities. Holds overall responsibility for Ascential’s risk management and internal control systems.
Reporting
Informing
Audit Committee:
• Oversees the Group’s financial statements and non-financial
Delegated responsibilities to Group Committees
Operational Risk Committees:
•
disclosures, including climate-related disclosures.
Identify risks (including emerging risks) and risk owners,
and scores risk.
•
Identify controls and mitigations to manage risk, setting
relevant targets.
• Agree action plans to strengthen controls or address deficiencies.
Review progress with action plans and current risks.
Reporting
Informing
Chief Executive & Executive Team
CEO – ESG Board Sponsor & COO ESG Executive Sponsor:
• Oversee and champion the Company’s ESG strategy –
including operational, financial, and environmental aspects.
• Oversee the setting of carbon emissions reduction targets
which see the Company align with regulatory requirements
and match the ambition of the Company.
• Empower leaders to identify and manage climate-related risks
• Overall Executive Team:
and opportunities.
• Support the above by identifying and managing climate-
• Ensure compliance with all applicable ESG regulations
related risks and opportunities.
e.g. TCFD, Transition Plans, ISSB.
•
Implement an accountability framework for ESG success
metrics with leadership.
• Empower Operational Leads and Teams to deliver required
action to mitigate risks and realise opportunities.
Reporting
Informing
Reporting
Informing
Sustainability Team:
•
Identify climate related risks and opportunities.
• Set company-wide goals.
• Align activity with identified goals.
• Gather data and manage reporting required to monitor
progress.
Sustainability Forum:
•
Identify climate related risks and opportunities.
• Enable delivery of company-wide goals.
• Provide data required for reporting.
Reporting
Informing
Brands Teams:
• The Brand Teams support the implementation of the Group’s ESG strategy, including climate
change risks and opportunities.
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Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements ESG strategy continued
Metrics and targets:
The following metrics and targets are used to assess and manage
relevant climate-related risks and opportunities. We continue to
focus on improving the methodology for measuring emissions as
well as increasing the scope and accuracy of emissions data that
we are collecting. We consider this to be fundamental to our ability
to develop a meaningful net-zero target, in line with UK
Government regulations, as part of our Climate Transition Plan.
In our 2022 Annual Report we set a target to complete our
Transition Plan in 2023, however, as explained in the introduction on
page 61, we now intend to complete our Transition Plan by the end
of 2025.
In 2023, we made significant progress with meaningfully measuring
our carbon emissions by conducting a cost-based analysis of our
entire scope 3 emissions and the results are published as part of
our SECR disclosure along with details of our methodology. We
intend to extend this progress in 2024 by increasing the number
of scope 3 emissions categories we measure on an activity basis
(currently only employee travel). As a result of this achievement,
we have been able to set our first carbon reduction targets shown
below. We will continue to set carbon reduction targets each year,
developing them as part of our Climate Transition Plan over the
next two years.
In addition to the targets listed below, we have been measuring and
reporting our direct energy consumption and carbon emissions
since 2016 and our Streamlined Energy Carbon-Related (SECR)
disclosure is set out on page 68. We do not apply a materiality
assessment to our Scope 1 and 2 emissions and therefore disclose
in full.
Risk
Metric
Target
Progress to date
Carbon reporting % Reduction
(scope 1 and 2)
Develop a Climate Transition Plan by
2025 which sets out a roadmap to
Net Zero in line with UK Government
guidelines.
As outlined in the introduction, development
of the Climate Transition Plan has been delayed
due to changes in the business and requirement
for further data gathering to set a baseline.
Carbon reporting
tCO2e per attendee
Carbon footprint all major events
in order to set baseline data and
develop targets for emissions
reduction as part of the transition
plan, to be completed by the end
of 2025.
Carbon reporting
and emissions
reduction*
% of activity-based scope
3 data collected
To have a scope 3 carbon footprint
which includes a minimum of 80%
activity-based data.
Carbon reporting
and emissions
reduction*
% of energy sourced
from renewable sources.
To increase the amount of scope 1
and 2 renewable energy used to 80%.
We completed the carbon footprinting of all
major events in 2023. New events to be
footprinted in 2024 include Money20/20 Asia
and Contagious Live. These footprints form the
baseline for our event emissions reduction
strategy which will be finalised in 2024 and
included in our Climate Transition Plan.
Implemented carbon measurement platform
to measure the whole company’s carbon
emissions. For the first time we have conducted
a full scope 3 emissions measurement, based
on spend data. The priority for 2024 is to move
to a supplier specific and activity-based carbon
measurement for scope 3.
As new offices are leased or acquired for the
business going forward, renewable energy
availability will be a decision-making factor in
order to increase the amount of renewable
energy used across the portfolio.
Waste
Tonnes of waste per
attendee
Waste footprint calculated
for all major events in order to set
baseline data and develop targets
for reduction.
We completed the waste footprint of all
major events in 2023. New events to be
footprinted in 2024 include Money20/20 Asia
and Contagious Live.
Supplier engagement in place re.
Waste disposal at events.
A reduction target for waste going to landfill has
been set for both Cannes Lions and
Money20/20 Amsterdam in 2024.
Supplier engagement on both waste and carbon
footprinting was high with further engagement
and support planned for 2024.
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Ascential plc Annual Report 2023 Risk
Waste
Metric
Target
Progress to date
% of office waste
recycled
Audit all offices by the end of 2023 in
order to assess current and future
capabilities for waste disposal and
recycling. Set targets for recycling
and reducing waste to landfill.
Business
disruption
% Suppliers with carbon
reduction targets
100% of suppliers with spend over
£50,000 per annum signed up to
climate change statement in RFP.
Business
disruption
# Sole suppliers/key
dependencies in
geographies at high risk
from physical effects of
Climate Change
Event attendance % score against
Ascential sustainable
events indicators
Assess supply chain to understand
the risk related to sole suppliers or key
dependency suppliers. Set targets
regarding management of sole
suppliers or key dependency
suppliers at high risk from physical
effects of Climate Change.
Develop Ascential sustainable events
indicators (e.g. net zero emissions, no
single-use plastic, maximum % of
waste to landfill) by the end of 2023.
Set minimum % Ascential events
must obtain against the Ascential
sustainable events indicators by the
end of 2024.
* New targets for 2024
We conducted the waste disposal audit for
all our offices and all offices have facilities to
recycle paper, plastic and cans as a minimum.
Due to the disposal of Digital Commerce and
WGSN, the office base has changed significantly
and this has delayed the setting of targets for
recycling v landfill to 2024.
Our Supplier Code of Conduct includes a
requirement for our suppliers to adhere to all
applicable environmental laws and regulations,
and to appropriately mitigate climate change risk
and contribute to reducing the environmental
impact of their products and services. All new
suppliers signing contracts with us sign up to the
new code of conduct.
Supply chain risk continues to be managed by
our Procurement team. Climate change risk is
considered through this process, with a focus on
regions identified through the ND-GAIN Country
Index as high risk.
The ‘Ascential Sustainable Events Standards’
were developed in 2023 which set out the
blueprint for event operations going forward. We
intend that all events in our portfolio fully meet
these standards by 2030, with an increasing % of
standards met each year until full compliance.
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Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements ESG strategy continued
Streamlined Energy
and Carbon Reporting
This carbon report is for Ascential to meet
the reporting requirements under The
Companies (Directors’ Report) and Limited
Liability Partnerships (Energy and Carbon
Report) Regulations 2018 to implement the
UK Government’s policy on Streamlined
Energy and Carbon Reporting (SECR).
This report includes the global carbon emissions data from the
current and previous two years. All entities within the Group are
included in the scope of emissions reporting, along with a
breakdown of both continuing and disposed of assets.
You can read more about our plans for reducing our emissions
in the previous sections on Climate Change Resilience and in our
‘Task Force on Climate Related Disclosures’ statement.
The adopted methodology used is based on the Greenhouse Gas
Protocol Corporate Reporting Standard reporting on equivalent CO2
emissions from organisational boundaries. Information has been
gathered in a format which is compliant with the ESOS Regulations.
For Scope 1 and 2 emissions, data is collated into kWh for all
corresponding UK and global-based operations, directly owned or
operated by Ascential (i.e. the organisational boundary). The kWh
or equivalent usage, has been converted to equivalent tonnes of
carbon dioxide (tCO2e) using the most appropriate emission factor
for the activity and location.
Methodology and scope for Carbon Reporting
Scope
1 and 2
→
→
Regional Office
Managers work with
landlords and
leaseholders to obtain
records of energy and
gas usage in our offices
throughout the year.
Office Managers submit
site energy usage to our
data management tool.
Any unavailable data from
offices is estimated
based on square footage
of the facility.
Scope 3
Relevant activity-based
Travel and employee
data, and spend-based
Financial data is provided
by internal teams to
assess our scope 3
emissions.
Corporate Responsibility
Team sense checks the
data and submits it to
data management tool.
→
Data is quality checked
by the Corporate
Responsibility Team
and analysed by
external consultants
as part of our data
management tool.
→
The relevant emissions
factors are applied to
calculate the tCO2e
associated.
Emissions factors are
used from a range of
sources including the US
EPA, Ecoinvent, DEFRA.
Electricity emission
factors are chosen based
on geography to reflect
the emissions intensities
of the facilities’ local grid.
SECR report is
produced and
assessed internally and
relevant commentary
added to provide
additional information
on any data changes.
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Ascential plc Annual Report 2023
In 2023 we updated the methodology used to calculate our carbon
emissions, resulting in us recalculating our 2022 emissions to
enable a meaningful comparison to 2023. We measure scope 1, 2
and scope 3 travel data at an activity level. Monitoring this data at a
brand level enables us to manage reduction targets in line with
business operations. Over the course of 2024, we will be able to
baseline our emissions data for the continuing operations and
understand where the opportunity is for reduction targets
including employee travel. This year we have also conducted a
spend-based analysis of all our material scope 3 emissions. We
have used a best estimate for any data that is unavailable to ensure
that our emissions are as representative as possible.
The adoption of a data management tool to directly collate the data
from the office contacts has resulted in more detailed information
being provided, such as data on the gas heating of buildings (scope
1), and increased the accuracy of the electricity of the data
provided for scope 2. The expansion to cover the material scope 3
categories has increased our visibility of the carbon emissions
throughout our value chain and increased the overall emissions
reported for that scope. As we develop our activity-based
assessment of all scope 3 categories we will be able publish
a further breakdown of these emissions.
Global greenhouse gas (GHG) emissions summary:
The table below includes combustion of fuels (Scope 1), purchase of energy including electricity, heat and cooling (Scope 2) and relevant
upstream and downstream business activities (Scope 3). We have not been able to accurately allocate Scope 1 and 2 emissions data, along
with total office area by continuing and discontinued operations as most of our office spaces were shared between brands in 2023.
2022
2022 (Revised)
2023
Continuing
Discontinued
106.9
981.3
1,088.2
2,570,406
17 %
n/a
n/a
n/a
n/a
n/a
n/a
81n/a
n/a
n/a
n/a
Emissions Type
Scope 11
Scope 22
Total 1 & 2
Intensity Factors (scope 1 & 2)
1. Turnover
2. Total area3
-
758.1
758.1
2,322,710
18%
£526.8m
26,344
£524.4m
26,344
£206.4m
n/a
£379.9m
n/a
£586.3m
31,107
Total
129
900
1,029
2,482,271
9%
Unit
Tonnes of CO2e
Tonnes of CO2e
Tonnes of CO2e
kWh
% from the UK
Turnover in GBP
Square metres
Average monthly
number of
employees
3. Total headcount
3,347
3,588
703
3,293
3,996
Carbon intensity 1
Carbon intensity 2
Carbon intensity 3
Scope 3 Travel
Global Car travel
Global Air travel
Global Hotel Nights
1.5
28.78
226.50
2.1
41.30
325.07
n/a
n/a
n/a
n/a
n/a
n/a
1.8 Total tCO2e/£million
Total kgCO2e/m²
Total kgCO2e/FTE
33.08
258.67
7.7
45,256
2,289.3
13,721,410
79.2
4,778
10.0
44,707
3,196.0
14,810,505
159.0
4,619
1.4
n/a
3,340
11,396,402
77.0
2,908
12.8
n/a
3,250
14,210,067
102.4
5,233
14.2
68,938 km
6,590
25,606,469
179.4
8,141
Tonnes of CO2e
Kilometres
Tonnes of CO2e
Kilometres
Tonnes of CO2e
Nights
Total reported Scope 3
Total scope 1, 2 and 3
2,408.36
3,166.46
34,020.00
35,108.20
20,183
20,286
26,383
27,309
46,566
47,595
Tonnes of CO2e
Tonnes of CO2e
1 Scope 1 emissions from natural gas only.
2
3 Total area is unavailable to split by continuing and discontinuing operations due to the number of office spaces shared between different brands.
Scope 2 emissions data includes some pro rata data on landlord-supplied energy including an average kWh/m2 rate for offices without metered billing.
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Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements ESG strategy continued
Materiality of scope 3 emissions:
The table below outlines the scope 3 emissions areas material to our business activities. This assessment was based on our business
in 2023 including assets disposed of at the start of 2024, and therefore demonstrates the scope 3 emissions relevant to our SECR report.
An updated assessment of this will be completed in 2024 to determine how this may change for our ongoing business.
Scope 3 Category
Category 1 – Purchased goods and services
Category 2 – Capital Goods
Materiality
Relevant and emissions reported
Relevant and emissions reported
Category 3 – Fuel and energy-related activities (not included in scopes 1 & 2)
Relevant and emissions reported
Category 4 – Upstream transportation and distribution
Currently assessed not relevant
Category 5 – Waste generated in operations
Category 6 – Business Travel
Category 7 – Employee commuting
Category 8 – Upstream leased assets
Relevant and emissions reported
Relevant and emissions reported
Relevant and emissions reported
Relevant and emissions reported
Category 9 – Downstream transportation and distribution
Currently assessed not relevant
Category 10 – Processing of sold products
Category 11 – Use of sold products
Currently assessed not relevant
Currently assessed not relevant
Category 12 – End-of-Life treatment of sold products
Currently assessed not relevant
Category 13 – Downstream leased assets
Category 14 – Franchises
Category 15 – Investments
Relevant and emissions reported
Currently assessed not relevant
Currently assessed not relevant
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Ascential plc Annual Report 2023 Social
Our aim is to support the community and
society in which we operate, whether that
be through charitable partnership in society
or increased diversity within our workforce
and content.
Our assessment of material ESG topics
for the ongoing business identified DEI in
relation to both our content and workforce
as a high priority along with talent attraction
and retention, which all remain at the core of
our social ESG strategy. This section provides
an overview of the work we’re doing to
support the wider community in relation to
our charity partnerships and supporting
Diversity, Equity and Inclusion in the sectors
we operate within. For information on our
DEI work in relation to our colleagues please
see page 46 of the Our People section.
Raised for The Prince’s Trust
£0.4m
Raised by Lions awards
£0.4m
Charity partnerships
Progress made in 2023:
• We have maintained our partnership with The Prince’s Trust for
the 11th year and continued to sponsor the ‘Education Achievers
Award’. In 2023 our Million Maker’s team raised over £378,000,
taking our total amount raised over the 11 years to over £2.5
million. The Trust is a charity that helps young people aged 11
to 30 get into jobs, education and training. The Million Maker’s
competition sees a team of colleagues volunteering for six
months to raise as much money as possible for the charity.
• We have also continued to support The Media Trust, whose
mission is to help under-represented talent enter the media
and creative industries.
• Our brands have continued to support charities that align
with the brand’s values and colleagues’ interests.
• Lions has continued to donate all profits from the Sustainable
Development Goals (SDG) Lion to a range of charities or
Not-for-Profit organisations who had won an SDG Lion. The
Sustainable Development Goals Lion celebrates creative
problem solving, solutions or other initiatives that harness
creativity and seek to positively impact the world. Entrants have
to demonstrate how they have advanced or contributed to the
SDG 2030 goals. This year the SDG Lion raised over €267,000,
in addition to the €73,000 also raised by the Glass Lion which
goes to charities supporting gender equality, taking the total
raised by both Lion awards to over €2 million since 2015.
Looking forward to 2024:
• Our company-wide charity partnership will continue to
align with our core values and provide opportunities for
colleague engagement.
• Brands will be encouraged to further develop charity
partnerships at a brand level that align with their colleagues,
communities and customers’ priorities.
Diversity, equity and inclusion
Diversity, Equity and Inclusion remains a crucial part of our ESG
work. We are not only committed to ensure that we attract, retain,
develop and maintain a diverse workforce to ensure our workforce
reflects the diversity experienced in our society, but we also aim to
deliver cultural richness for our customers and to help progress
to a more equal society.
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Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements ESG strategy continued
Commitments
Vision
For Ascential, diversity is at our core.
Our value as an employer and to our
customers is greater when we draw
on the full range of our collective
perspectives and experiences. We
continue to be committed to attract,
retain, develop and engage a diverse
workforce, and we will work constantly
to ensure that everyone at Ascential
feels comfortable to be themselves.
This is the right thing to do to ensure
a sustainable future for our organisation
and to make a positive impact for our
people, customers and society.
Commitments
Objectives
To employees
We will co-create an inclusive culture
with equitable systems throughout our
workforce, so that people are
comfortable in bringing their authentic
selves to Ascential, to thrive and progress
their career.
To customers
We will deliver the ideas, perspectives
and cultural richness that our customers
– and their customers – need to
future-proof their products and services.
To society
We will play our part in imagining and
developing a brighter, more equal
society, starting with our own company
and the industries we work in. We will
report openly and regularly on our progress
to enable others to learn from us and hold
us to account.
Employees
• We aim to create a workforce that fully
reflects, at all levels, the ethnic diversity
of our major markets before 2030.
• We aim to ensure our senior leadership
represents an equal gender split before 2030.
• We commit to measuring and assessing
any possible gender and ethnicity pay gap.
Customers
• Each of our major brands will develop
specific, measurable and public ways of
championing diversity in their respective
industries and track progress systematically.
Society
• We will report honestly on our workforce
diversity data and initiatives on an annual
basis to create accountability, show
progress and share our lessons.
• We will continue to manage and seek
appropriate charity partners in line with our
ambitions to support young people to
succeed in the digital world.
Progress made in 2023:
• We continued to conduct our Inclusive Content Audit, part
of a programme of activities which measures and delivers
representative content and marketing, extending this to the
analysis of speakers partaking in our events.
• DEI programme design and delivery largely sits at brand and
division level, allowing it to represent the priorities of their
colleagues, customers and communities.
• We have continued our programmes for internships and
apprenticeships for early opportunities within our brands.
Activity in detail:
• Since our first Inclusive Representation Content Audit in 2021,
our Content and Marketing teams have implemented action
plans to ensure their content represents the diversity of the
communities we serve. Through the audits we assess the
perceived gender and race and ethnicity of all quoted
individuals, contributors and imagery used. Our most recent
audit of a week in July 2023, identified that we have increased
representation of women by 12% and minority race/ethnicity by
19% across all our brands’ content, meaning that our content is
representative of the markets we serve.
•
In addition to the content audit this year, we analysed the
perceived gender and race and ethnicity of our speakers at our
Cannes Lions Festival of Creativity and Money20/20 Europe
event. Our speaker line-up at both events represents the
diversity of our markets. We will continue to keep a focus on this
area to ensure we’re fully representative.
• Our brands continue to run a range of programmes which
provide skills and opportunities for those under-represented in
their industries. The Rise Up programme in Money20/20 is an
annual programme for women and non-binary leaders. 250+
women have been through the programme since its launch in
2018. See It Be It, run by Lions, has had 100+ women and
non-binary people from over 40 countries through the
programme since its launch in 2014.
• Since the transfer of the delivery of DEI at brand level, Lions has
made significant progress towards its DEI strategy, including
hiring a new Chief DEI Officer who is responsible for Lion’s DEI
strategy moving forwards. Key DEI initiatives implemented
include Psychological Safety training for all managers and
leaders, and an accessibility and inclusion framework developed
to measure progress at the festival.
•
In 2023, we continued to deliver a range of internships within
our brands which included four placements within WARC, and
four within Lions. The Lions internships include rotations across
a range of teams as well as the opportunity to attend Cannes
Lions Festival of Creativity.
Looking forward to 2024:
• Brands will continue to lead on activity which matches the
priorities of their colleagues, customers and communities.
• Our 2024 DEI report will be published later in the year and will
set out ambitions for the years ahead and progress against
existing commitments.
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Ascential plc Annual Report 2023 Governance
This section relates specifically to how we
govern our Corporate Responsibility and
ESG work. For information on Corporate
Governance of the Group and compliance
with the UK Corporate Governance Code,
please see page 88.
Compliance framework
Our formal compliance framework enables a structured and
consistent approach to managing our ESG policies and compliance
more generally. The framework is structured around 12 Compliance
Pillars under which we focus our priorities. Where appropriate we
have policies governing each area and further information is
provided below.
Overview
Progress made in 2023:
• To reflect the increased importance of our ESG work, we
have established a new governance structure in relation to
our ESG strategy.
• Completed an updated Materiality Assessment for Ascential
to determine our material ESG topics.
Activity in detail:
• Philip Thomas, Chief Executive Ascential, has been appointed
as ESG Board Sponsor and Kent Dreadon, Chief Operating
Officer Ascential, as ESG Executive Sponsor. Both these roles
will oversee and champion the Company’s ESG strategy,
ensuring compliance and accountability.
• An updated Materiality Assessment was conducted to
determine our material topics for Ascential. This included input
from our key stakeholders within the business. The results of
the assessment can be found on page 57.
• Our ESG and Environmental priorities have been approved
by the Board, which set out an ambitious plan for 2024.
For more details see page 60.
Looking forward to 2024:
• We will increase Board engagement and updates on ESG.
A dashboard update on the key ESG metrics will be delivered
to the Board quarterly, with in person updates delivered by
our Head of Sustainability twice a year.
Code of Conduct
Whistleblowing
Competition Law
Anti-Bribery and
Corruption
Financial Crime
Listing Requirements
(inc. Market Abuse
Regulations)
Economic Sanctions
Third Party Code of
Conduct
Data Security
Data Privacy
Health and Safety
Physical Security
G ood o perational
A ctin g with integrity
g overnance
Peo ple
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Employee code of conduct (“the Code”)
The Code sets out our key compliance commitments and
expectations in terms of ethical and lawful conduct for our people
and our external partners. It is available in English, Simplified
Chinese and Brazilian Portuguese for our colleagues.
In January 2023 we launched the training window for the Code
training programme which achieved 100% completion rate. New
starters are required to complete this training as part of their
onboarding process to ensure that all of our people understand
their obligations and our expectations of them under the Code.
The Code is broken down into four sections:
About the Code
Details how the Code is applicable to all colleagues and partners who act as an extension of our business
including consultants, suppliers and joint venture partners.
Details of our ‘Speak Up’ service are included which is our whistleblowing system – further details on page 77.
We are committed to
ethical and safe working
The policies included in this section are:
• Whistleblowing policy
• Equal Opportunities policy
• Health and Safety policy
• Conflict of Interest policy
The section sets out how we respect others, promote well-being and safety and avoid conflicts of interest.
We act with integrity
The policies included in this section are:
• Records retention policy
• Anti-facilitation of tax evasion policy
• Anti-bribery and corruption policy
• Gifts and hospitality policy
• Expenses policy
• Sanctions policy
• Employee Share Dealing code
The section sets out how we keep accurate records, actively prevent illegal transactions, do not tolerate any
form of bribery and corruption and the approach we take to gifts and hospitality. We follow trade sanctions
and explain the prohibition on insider dealing. We compete honestly and fairly.
We operate responsibly The policies included in this section are:
• Cyber Incident Policy
• Acceptable Use Policy
• Data Classification Policy
• Guide to Working with Procurement
• Third Party Code of Conduct (see more detail on page 75)
• Global Data Protection (see more detail on page 76)
• Standards and Procedures
This section sets out how we protect our assets and information and the personal information and data from our
colleagues, customers and clients. We value and respect our partners and source responsibly, ethically and lawfully.
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Ascential plc Annual Report 2023 Business continuity
• Any disruptions of business are prepared for (including but not
limited to natural disasters, pandemic, terrorism or cyber
attacks). Risks are frequently assessed, and appropriate controls
put in place and regularly tested.
Quality, health, safety and environment
• All required quality, health, safety and environment-related
permits, licences and registrations are obtained, maintained and
kept up to date and their operational and reporting requirements
are followed. Proper provision is made for the health, safety and
welfare of employees, visitors, contractors, the community and
the environment.
• Health, safety and environmental risks are regularly assessed, and
appropriate controls are put in place bearing in mind the prevailing
knowledge of the industry and of any specific hazards.
Climate Change risk:
• We require adherence to all applicable environmental laws
and regulations to appropriately mitigate climate change risk.
We assess environmental impact in our supply chain with
respect to any or all of the following: carbon emissions, energy
consumption, travel, water consumption, single-use plastics,
paper usage and operational waste. Our expectation is that our
suppliers and supply chain cooperate and contribute to reducing
the environmental impact of their products and services.
Read more:
The full Third Party Code of Conduct is available
on our website: ascential.com
Third party code of conduct
To best serve our customers we require a truly global supply chain.
We also recognise that responsible and ethical sourcing is key to
our success. Our Third Party Code outlines our ethical approach to
doing business. These are the standards we also hold ourselves to
and explain the behaviours and attributes we expect from all of our
suppliers and their subcontractors.
Main principles of Third Party Code of Conduct:
No forced, involuntary or child labour
• There is no forced, involuntary or debt- bonded labour in any
form including slavery or trafficking of persons. There are no
workers under the age of 15, or where it is higher, the mandatory
school leaving age in the local country. The use of legitimate
workplace apprenticeship programmes, which comply with
all laws and regulations, is supported.
Freedom of association
• Workers, without distinction, have the right to associate freely,
join or not join labour unions, seek representation and join
workers’ councils as well as the right of collective bargaining
in accordance with local laws.
Diversity and equality
• There is equality of opportunity and treatment regardless of
physical attributes or condition (including pregnancy), gender,
religion (or absence of such beliefs), political opinion, nationality,
sexual orientation, age or ethnic background. Equal pay for work
of equal value is supported. Discrimination or intimidation towards
and between employees is opposed, including all forms or
threats of physical and psychological abuse.
Business integrity
• There is no tolerance of any form of corruption, bribery, fraud,
extortion or embezzlement and business is conducted in a
manner that avoids conflicts of interest.
Fair competition
• Fair business, advertising and competition are supported.
Intellectual property, privacy and data security
• There is respect for and protection of intellectual property
rights, data and confidential information to safeguard it against
and prohibit loss and unauthorised use, disclosure, alteration or
access. Our intellectual property and confidential information
are handled and data processed on our behalf only for the
purposes for which they were made available, received or
collected in accordance with the reasonable directions
provided by us.
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Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements ESG strategy continued
ESG policies:
Compliance – Audit Committee Oversight
The Director of Compliance reports to the Audit Committee at
least annually with ratings for group-wide compliance across each
of our eleven identified compliance pillars, which include data
security, data privacy, bribery and corruption and health and safety.
Data privacy, personal data and cyber security
Overall approach:
Data is integral to Ascential and our colleagues analyse and share
data every day in providing services to customers. It is critical to our
business that we protect this data, manage it responsibly, and
ensure we are collecting and storing it in the most compliant,
secure and effective way.
Our global cyber security, data privacy and data protection policies
are standardised across our brands and apply across our whole
technology estate. We keep these policies updated by undertaking
regular audits, the results of which are shared annually with the
Audit Committee.
Our suppliers commit to following our data security and privacy
controls. We manage this process through our initial supplier due
diligence and ongoing through contract management.
Data Privacy
Our Data Privacy Hub provides policies, processes and information
to help support the business to manage and maintain data privacy
compliance across the organisation. Housing this information in
one place has helped embed the approach across the business
and enable quick onboarding with new acquisitions into our data
privacy and safety approach.
Our eight commitments to data privacy and protection are:
• Being lawful
• Being fair and transparent
• Respecting individual rights
• Minimising data collection, keeping accurate and up-to-date
data, and following retention policies
• Protecting personal data
• Appropriate safeguards for cross-border data transfers
• Good governance
• Accountability
Ascential has in place a governance structure to ensure that there
is appropriate senior management responsibility and oversight.
This includes:
• Data Privacy Steering Committee which is attended by senior
business executives. The minutes from the Committee
meetings are distributed to the CEO, CFO and COO.
• Ascential’s Legal and Compliance Team evaluate, test and report
on the Ascential group entities’ compliance with the policy to
the Audit Committee annually.
•
Independent audits are conducted regularly: Ernst and Young
conducted an audit in 2023, and reported its findings directly
to the Audit Committee.
Personal Data
The nature of our business means that we hold very limited
quantities of personal data, outside of employee data. We have
in place group-wide privacy policies which apply to all personal
data processed by the Ascential group as a data controller for
our own purposes.
Ascential takes steps to ensure it only processes personal data for
specific and lawful purposes which are defined and explained to
individuals when we process their data. Our use of such personal
data is limited to those purposes and if this changes, we make sure
the new purposes are provided to individuals prior to the
commencement of such processing.
We respect the rights that individuals have in relation to their
personal data and have processes in place to recognise and
respond to individuals wishing to exercise these rights.
We ensure that personal data is kept up to date and not retained
for longer than the purposes for which it was collected. Individuals
may request deletion of their personal data which is actioned at
a Brand level by our Privacy Champions.
Data Collection Guidelines
Data underpins our ability to provide our customers with the
highest quality service. While delivering our valued and trusted
products, it is important to us that we do business responsibly,
ethically and lawfully.
We have created a set of guidelines for relevant internal teams and
third-party suppliers which set out our standards with regards to
data harvesting. The guidelines have a clear set of ‘do’s and don’ts’
with regards to data collection. We have a policy on handling and
using anonymised data, which everyone adheres to.
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Ascential plc Annual Report 2023 Staff Training
All employees are required to undertake data privacy and security
training as part of Ascential’s Code of Conduct annual awareness
training, which is also provided to new employees as part of their
induction. Specific security training is required to be completed by
all employees on a yearly basis thereafter.
Targeted data privacy training is delivered annually to those areas of
the business assessed as higher risk and to subject-matter experts
(including Privacy Champions).
Cyber Security
We have global information security policies and procedures to
manage and maintain data security breaches.
We are committed to implementing leading data security
safeguards and continue to deploy technical solutions to
strengthen the management of data security and data privacy risk.
These include:
• multi-factor authentication
• data loss prevention
• access and controls to systems and regular auditing
of account access
• monitoring of compliance with our cloud security framework.
The results of the 2023 Cyber Security Audit were shared with the
Audit Committee and progress against any recommended actions
arising from the audit is tracked by Internal Audit.
The cyber security team delivered face-to-face awareness training
to over 3,000 employees during 2023, and all Ascential employees
completed the cyber security eLearning training.
Data Security Incidents
15 data security incidents were logged in 2023, none of the
incidents were classified as high risk, and all personal data incidents
were minor.
Whistleblowing Policy
We have a formal whistleblowing policy which encourages all
staff to report suspected wrongdoing, in the knowledge that their
concerns will be taken seriously and investigated appropriately and
that their confidentiality will be respected.
Wrongdoing includes failure to comply with legal obligations or
regulations, including bribery and corruption.
The policy also aims to reassure staff that they should be able to
raise genuine concerns without fear of reprisals, even if they turn
out to be mistaken.
Our ‘Speak Up’ whistleblowing tool was in place throughout the
year and colleagues can access details via the Code of Conduct on
both the website and Intranet. We also have in place a confidential
helpline operated by an independent third party. All incidents that
are reported to us uploaded into our case tracking and monitoring
system, are investigated, managed and tracked to completion.
The Audit Committee receives a report of all such incidents, together
with the actions taken to investigate and resolve the complaint.
In 2023, we received five complaints through our whistleblowing
tool, none of which were identified as formal whistleblowing
concerns. Each of these cases have been investigated, and dealt
with appropriately.
Modern Slavery
We have a zero-tolerance approach to Modern Slavery of any kind.
Our work to eliminate Modern Slavery is supported by customers,
suppliers and Ascential employees.
We assess the risk of Modern Slavery in our internal operations and
our external supply chain against criteria including: (i) geography
(countries where bonded labour is more prevalent); (ii) sectors (the
nature of product or service procured or supplied and whether it is
typically associated with unfair labour practices); and (iii) the nature
of our business operations. Our assessments are informed by
sources such as the Walk Free Foundation.
High and medium-risk suppliers are required to adopt our Third
Party Code of Conduct and to complete a questionnaire designed
to identify any areas of non-compliance with that code, as well as
confirm that our supply chain is slavery and human-trafficking free.
We reserve the right to terminate the business supplier relationship
without consequence or liability if a supplier fails to fulfil the
minimum standards we expect.
In 2023, we did not identify any instances of modern slavery either
in our company or our supply chain.
Our full Modern Slavery Statement, which has been
approved by the Board of Ascential, is available on our website
ascential.com/about-us
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Ascential plc Annual Report 2023Strategic reportGovernance reportFinancial statements ESG strategy continued
Anti-bribery and corruption
We have a formal anti-bribery and corruption policy which applies
to all Ascential companies, Ascential employees and associated
third parties.
The policy also provides details of how employees can ask advice
or report any suspected bribery or corruption to an independent
third-party helpline, and explicitly confirms that no employee will be
penalised for losing business by refusing to accept or offer a bribe.
We define a bribe as anything of value given in an attempt to affect
a person’s actions or decisions in order to gain or retain a business
advantage. We define corruption as the misuse of a public office or
power for private gain or the misuse of private power in relation to
business outside the realm of government.
Our anti-corruption policy prohibits offering, promising or giving
a bribe; requesting, agreeing to receive, or accepting a bribe; and
bribing a foreign public official to obtain or retain business or
a business-related advantage.
The policy highlights areas where there is a higher risk of corruption:
• Journalists and editorial staff: specific risks that certain conduct
may amount to bribes, for example the use of payments to
improperly receive information, influence editorial decisions,
write or publish an article with a particular focus not in keeping
with journalistic integrity or reveal source information.
• Operations and procurement: employees who contract with
associated third parties to supply services are required to be
transparent about gifts or free services offered to incentivise
staff to pick that supplier or venue over another and must
comply with the Gifts and Hospitality policy.
• Facilitation payments: these are unofficial payments made to
public officials to secure or expedite the performance of a duty
or function. Facilitation payments are specifically prohibited.
• Due diligence and contract terms: all written contracts with
third parties should include anti-bribery and corruption
representations and warranties allowing for immediate
termination of the contract if another contracting party or their
agent pays or accepts bribes in connection with our business.
• Gifts and Hospitality: our Gifts and Hospitality policy is
communicated to all employees, along with annual and new
employee induction training to raise awareness. The policy
and training communicate to employees: (i) that gifts or
entertainment given or received must not give a feeling of
an obligation or an incentive to behave in a certain way, (ii) the
value limits of gifts and hospitality that employees may give and
receive, and (iii) the requirement, prior to giving or receiving
above certain limits, to declare on a centrally maintained register
and obtain approval.
Additional focus and training have been given in this area, with
clear training and guidance given to the legal team and focussed
training and support given to the geographies and businesses with
the heightened risk.
The Ascential Board has appointed the Audit Committee to review
this policy and the Audit Committee periodically monitors and
audits compliance.
Tax Strategy
The Board is ultimately responsible for Ascential’s tax strategy and
we are committed to maintaining full compliance with all relevant
laws and regulations in the countries in which we operate.
We take a low-risk approach to tax planning and we have a strategic
objective to achieve a low-risk status as determined by HMRC’s
Business Risk Review process.
We seek to obtain this status through:
• Paying the right amount of tax on time
• Submitting all tax returns on a timely basis
• Ensuring that tax returns include sufficient detail to enable the
tax authorities to form an accurate view of the affairs of the
company filing the return with an adequate supporting audit
trail and sign-off process
• Maintaining tax accounting arrangements which are robust and
accurate and comply with local regulations as well as with the
Senior Accounting Officer provisions in the UK.
Working closely with the tax authorities at all times we seek to
ensure that our tax affairs are transparent and sustainable for the
long term. We publish our tax strategy on our website to allow
stakeholders, including shareholders, governments, colleagues and
the communities in which Ascential operates, to understand our
approach to taxation.
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Ascential plc Annual Report 2023 Equal opportunities
We are committed to maintaining a working environment
underpinned by decency and fairness and where equality and
diversity are recognised, encouraged and valued.
We actively encourage equality of opportunity for all employees
and job applicants. We have a formal equal opportunities policy
which prohibits discrimination against anyone on the basis of the
protected characteristics of: disability; gender reassignment;
marriage or civil partnership status; pregnancy or maternity; race,
colour, nationality, ethnic or national origin; religion or belief; sex;
sexual orientation; and age. The policy also applies to the
recruitment, promotion and remuneration of employees.
The policy defines different forms of discrimination including direct
discrimination, indirect discrimination, harassment, victimisation
and failure to make reasonable adjustments.
During the year, we published an updated Diversity, Equity and
Inclusion report which explains our progress against our
commitments and goals for the year ahead.
Read more:
For more information on our Diversity & Inclusion initiatives,
please see page 46.
Health & Safety
We commit to the care we take for the health, safety and wellbeing
of employees and others we work with including contractors, those
participating in our events and visitors to our offices. We have a
comprehensive risk management process, and through this we
identify risks to people’s health, safety and wellbeing and put in
place measures to manage them appropriately.
The main features of the Ascential safety organisation are:
• Safety Committee – which reports to the Group Executive
Leadership Team, and
• Safety Working Group – which reports to the Safety Committee
and includes Safety & Wellbeing Champions representing all
business areas, brands and locations.
The Safety Committee is chaired by the Chief People Officer. It
meets quarterly and includes representation from each division and
corporate functions. All accidents and near miss incidents are
reported to the Safety Committee, with safety performance
statistics collated quarterly.
The Safety Committee reports to:
• Group Executive Leadership Team
• Group and Divisional Risk Committees
• Audit & Risk Committee
Our objective is to ensure that everyone in Ascential is fully aware
of potential safety risks and of everyone’s role in ensuring that we
take appropriate care of the safety, health and welfare of people in
our offices, attending our events or travelling for business. We
follow the Plan-Do-Check-Act management system:
• Plan – publishing on the intranet our Health & Safety Policy and
internal safety management structure;
• Do – assessing risk and holding regular reviews to ensure we are
complying with our policy;
• Check – investigating all accidents, incidents and near miss
events to identify areas for improvement or non-compliance;
and
• Act – training and educating our people and taking corrective
action where necessary.
We are committed to
maintaining a working
environment underpinned
by decency and fairness and
where equality and diversity
are recognised, encouraged
and valued.”
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Governance
Report
82 Chair’s introduction
84 Governance at a glance
86 Board of Directors
88 Governance framework
94 Audit Committee report
102 Nomination Committee report
104 Report of the Remuneration Committee
107 Directors’ remuneration policy
115 Annual report on remuneration
126 Directors’ report
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Ascential plc Annual Report 2023 81
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Governance
Chair’s
introduction
Scott Forbes
Chair
The successful sales of Digital Commerce
and WGSN provides clear evidence of
the Board’s commitment to act boldly in
the best interests of shareholders and
deliver substantial value. We clearly see
the opportunities that our newly
focussed business offers.”
Dear Shareholder,
We have demonstrated our commitment to corporate governance
through our full compliance with the UK Corporate Governance
Code (“the Code”) throughout 2023. The requirements of the Code
are summarised on page 88, along with a reference to where we
set out in detail how we have complied with its various provisions.
Our operational execution in the year has been strong as our
events continue to outstrip their pre-Covid 2019 benchmark levels
of performance. You can read more about our 2023 performance
in the Financial Review on pages 24 to 31 and our business priorities
for 2024 in the Chief Executive’s Review on pages 6 to 7.
Strategic Review
As previously announced, we completed the disposals of our
Digital Commerce and WGSN businesses to Omnicom and Wind
UKBidco 3 Limited (a newly formed company established by funds
advised by Apax Partners) respectively, in the first quarter of 2024.
The ongoing Hudson MX sale process contemplates a target
completion date in the second quarter of 2024.
The successful sales of Digital Commerce and WGSN provides
clear evidence of the Board’s commitment to act boldly in the best
interests of shareholders and deliver substantial value. The £850m
return of value represents one of the largest capital returns by a
UK plc as a percentage of market capitalisation. The transactions
generated net cash proceeds of £1.2bn and a profit of
approximately £0.5bn in 2024. We recorded a corresponding loss
after tax for discontinued operations of £196m in 2023 ahead of
the disposals’ completion date in 2024.
After continuous review of our evolving share register following
the announcement of these disposals, as well as extensive
consultation with shareholders, the Board considers that the
most appropriate form of return of value is a combination of up
to £400m of share repurchases, primarily through a tender offer,
and a special dividend of £450m. The special dividend will be
accompanied by a share consolidation subject to approval at
Ascential’s 2024 AGM. Further detail in relation to this return
of value will be set out in the notice of meeting.
Leadership
On completion of the Digital Commerce Sale, Duncan Painter,
formerly Chief Executive Officer of Ascential, joined Omnicom
and stepped down from the Board of Ascential plc. On behalf
of the Board, I thank Duncan for his visionary leadership and
stewardship of Ascential over the past 12 years. Philip Thomas,
formerly Chief Executive Officer of Ascential Intelligence and
Events, was appointed as Chief Executive of Ascential plc.
Independent Non-Executive Directors Joanne Harris and Charles
Song also stepped down from the Board of Ascential on completion
of the Digital Commerce Sale. On behalf of the Board, I thank
Joanne and Charles for their significant contributions to Ascential
as Non-Executive Directors, especially with respect to their guidance
around the development of our ecommerce proposition.
82
Ascential plc Annual Report 2023 As at 31 December 2023, Board composition was 66% female and
11% under-represented minority ethnic groups, which also satisfies
the targets set by the Hampton Alexander and Parker reviews
respectively.
Following Joanne Harris and Charles Song stepping down from the
Board following the completion of the sale of Digital Commerce,
the Board is comprised of 71% female directors and no directors
from under-represented minority ethnic groups prior to the
recruitment and appointment of new directors in 2024. We will
continue to take into account the capabilities, experience and
diversity that reflect our business, ethos and stakeholders as we
conduct our search for additional Non-Executive Directors in 2024.
Our annual Diversity, Equity & Inclusion report outlines the
progress against the targets we set for 2023 and will be published
in April 2024. You can read more about our diversity and inclusion
statistics and commitments on page 46.
Relations with shareholders
As Chair, I am responsible for effective communication with
shareholders and for ensuring that the Board understands the
views of major shareholders. Our extensive investor programme is
active throughout the year and is set forth on page 92. The Board
receives feedback from investor meetings from me and the
Executive Directors, and is further informed by the Company’s
brokers who report extensive feedback from investors on an
unattributed basis. You can read more about how we engage with
our investors on page 54.
Conclusion
I hope you find this report useful in understanding the
arrangements and processes we have in place, and what we have
done to comply with the recommendations of the Code. I believe
that your Board remains effective and continues to work well.
We have the right balance of skills, expertise and professionalism
to continue to deliver strong governance whilst supporting the
Executive Directors to execute the strategy we have designed to
continue to maximise value for shareholders.
Scott Forbes
Chair
25 March 2024
The Nomination Committee led by Senior Independent Director
Rita Clifton has engaged a globally recognised search firm to
review the capabilities and experience required on the Board that
will best position a focussed, high-quality events-led business to
achieve its strategic objectives. Four of our Non-Executive
Directors will have completed nine years of service in 2025 and are
ordinarily expected to resign at the May 2025 AGM in accordance
with best practice. The Company is actively recruiting directors to
both replace these outgoing directors and ensure that the Board
composition reflects the capabilities, experience and diversity that
reflect the Company’s business, industry, organisation and
geographies where the Company conducts its business.
Effectiveness
It is a key part of good governance that the Board and its
Committees undertake an annual evaluation to ensure that it
continues to operate effectively. In accordance with the Code and
our three-year performance evaluation cycle, this evaluation was
conducted internally for the year to 31 December 2023. The Board
evaluation process confirmed that the Board has worked
effectively during the year, with the diversity of experience,
knowledge and background providing a good breadth of skills.
The Board demonstrated its ability to take bold decisions that
resulted in generating significant shareholder value, whilst
maintaining robust governance standards and an informed,
risk-considered approach. Directors confirmed that they felt there
was a good balance of discussion and challenge, with strong
engagement and a constructive and objective mindset. All
Directors will offer themselves for re-election at the forthcoming
AGM. Full details of the evaluation methodology and its outcome
are set out on page 103.
Details of the Board’s engagement with the business are set
out on page 91.
Accountability
The Board considers principal and emerging risks throughout the
year, as well as formally reviewing the Company’s principal risks.
The Audit Committee reviews the system of internal controls and
risk management, and reports this work to the Board which then
confirms the effectiveness of internal controls in place throughout
the year.
You can read more about our principal risks and risk management
framework on page 32, and on the work of the Audit Committee
on page 90.
Diversity
Our practice of conducting periodic internal and externally
facilitated Board reviews has become a proven way of ensuring
that our Board is comprised of Directors with a diversified range
of capabilities as well as business, board and life experience.
We believe that Directors with diverse experience best position
the Board to assist the Company to achieve its evolving business
strategy and success. A board that is diversified is better prepared
to respond to evolving industry trends and act upon new
business opportunities.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Governance
Governance at a glance
Highlights 2023
• Concluded its strategic review and announced the
disposals of Digital Commerce and WGSN for total cash
proceeds of £1.2 billion.
• Agreed the post-separation Ascential strategy and
investment case.
• Reviewed progress against 2023 ESG priorities and
approved the 2024 ESG-related priorities.
Priorities 2024
• Complete the return of value to shareholders of £850m
announced in connection with the disposals.
Experience
The Board has a wide range of experience and capabilities
aligned to the Board’s strategic and operational agenda and
geographical spread of the business:
90%
80%
80%
70% 70%
70%
60%
• Commence recruitment of directors to both replace
50% 50%
outgoing directors completing nine years of service in 2025
and ensure that Board compositions reflects the capabilities,
experience and diversity that reflect the Company’s
business, industry, organisation and geographies where the
Company conducts its business.
40%
Attendance
During 2023, there were five scheduled Board meetings and
an additional nine ad hoc meetings to consider items relating
to the separation and ultimately sale of Digital Commerce and
WGSN. Due to the nature of the transaction process, these
meetings are often called at relatively short notice and
inevitably there are some occasions where not all Directors are
able to attend. Where this is the case, all Directors unable to
attend receive the relevant supporting documents, have
sufficient time to ask questions and receive answers, and
provide their comments and/or proxy vote in respect of the
matter being considered to the Chair.
The attendance by Directors at Board meetings during 2023 was:
Director
Scott Forbes (Chair)
Duncan Painter (CEO)
Mandy Gradden (CFO)
Paul Harrison (COO)1
Rita Clifton (NED)
Suzanne Baxter (NED)
Joanne Harris (NED)
Gillian Kent (NED)
Charles Song (NED)
Meetings
attended –
scheduled
5/5
5/5
5/5
4/4
5/5
5/5
5/5
5/5
4/5
Judy Vezmar (NED)
4/5
Meetings
attended –
ad hoc
9/9
9/9
9/9
8/8
8/9
6/9
6/9
8/9
6/9
7/9
%
100
100
100
100
100
100
100
100
80
80
%
100
100
100
100
89
67
67
89
67
78
1 Stepped down from the Board on 30 September 2023
1
2
3
4
5
6
7
8
9
10
1 Audit and Finance
2 Business Integration/operational transformation
3 Consumer Packaged Goods Experience
4 ESG
5 Global Account Consultancy Sales
6 Human Resources and Talent Management
7
Investor Relations
8 Listed Environment
9 Remuneration
10 Strategy and risk
Geographical experience
80%
70%
50%
30%
20%
UK
US
EMEA
LATAM
China & Asia
84
Ascential plc Annual Report 2023 Time
The Board has a rolling 12- month forward agenda to ensure that
appropriate time is allocated to all aspects of its remit, including
sufficient capacity for forward looking strategy discussions:
Strategy
Performance, operations & risk
Corporate governance
Acquisitions
Capital allocation and budget
Investor relations*
As at 31 December
2023
57%
25%
10%
5%
3%
0%
2022
45%
22%
9%
12%
8%
4%
Composition
The Board comprises a majority of Independent
Non-Executive Directors:
Independent NEDs
Chair & Chief Executive
Other Executive Directors
As at 31 December
2023
66%
22%
11%
2022
60%
20%
20%
*
Investor relations was included in the strategy category for 2023 as it was closely
intertwined with the strategic review.
2023
2022
2023
2022
Diversity
The diversity of our Board composition, both in terms
of gender and ethnicity, is shown below:
Independent Director tenure
Whilst we had a balance of the length of tenure amongst our
Independent Non-Executive Directors as at 31 December 2023,
the balance after the stepping down of Joanne Harris and Charles
Song in January 2024 is weighted to Non-Executive Directors
with a tenure of seven or more years (three out of four). See the
Nomination Committee report on page 102 for more information
on Non-Executive Director rotation plans:
Gender
Female
Male
As at 31 December
2023
6
3
2022
6
4
2023
2022
As at 31 December
2023
2022
Number
3
% Number
3
50%
3
50%
3
%
50%
50%
0-3 years
7-9 years
Ethnicity
White
Black, Asian or Minority Ethnic*
As at 31 December
2023
8
1
2022
9
1
2023
2022
2023
2022
*
We understand BAME is an imperfect term. We have used it here, as when
comparing race data across regions it’s the most commonly used aggregate term.
85
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Board of Directors
Our experienced and
effective leadership1
The Board continues to be
committed to maintaining the
highest standards of
corporate governance and
ensuring purpose, values and
behaviours are consistent
across the business.
1 As at 29 February 2024
Key to committees
Committee Chair
Audit
Nomination
Remuneration
page 94
page 102
page 104
Scott Forbes
Chair
Philip Thomas
Chief Executive
Appointed to the Board
January 2016
Independent
Yes
(on appointment)
Committees
Meetings attended
14/14
Nationality British
Key areas of prior experience
Board and committee chairing, business
strategy, digital marketplaces, operations,
finance, mergers & acquisitions,
capital markets.
Current external appointments
• Chair, Cars.com
• Senior Independent Director and
Remuneration Chair, Auction Technology
Group plc
Previous experience
• Chair, Rightmove plc
• Chair, Orbitz Worldwide
• Non-Executive Director, Travelport Worldwide
• Group Managing Director, Cendant Europe
Appointed to the Board
January 2024
Independent
No
Committees
–
Meetings attended
N/A
Nationality British
Key areas of prior experience
Digital transformation, media products &
platforms, scaling event operations, global
business expansion, marketing
effectiveness, creative excellence.
Current external appointments
• Chair of Media Trust
• Member, BBC Advisory Board on AI
Personalised Content
Previous experience
• President, Ascential Futures
• Chief Executive, Cannes Lions
• Managing Director, EMAP Australia & SE
Asia
• Managing Director, FHM
Suzanne Baxter
Non-Executive
Director
Gillian Kent
Non-Executive
Director
Appointed to the Board
January 2021
Independent
Yes
Appointed to the Board
January 2016
Independent
Yes
Committees
Meetings attended
11/14
Nationality British
Key areas of prior experience
Chartered accountant, corporate finance,
mergers & acquisitions, business services,
audit, transformation.
Current external appointments
• Non-Executive Director and Audit Committee
Chair, Auction Technology Group plc
• External Board member and Audit Committee
Chair, Pinsent Masons International LLP
• Member of Audit Partner Remuneration and
Admissions Committee and Independent
Non-Executive, Public Interest Body of
PricewaterhouseCoopers
Previous experience
• Audit Committee Chair, WH Smith plc
• CFO, Mitie Group plc
Committees
Meetings attended
13/14
Nationality British
Key areas of prior experience
Digital media, marketing, brands,
remuneration, transformation,
technology, strategy and voice
of the consumer & customer
Current external appointments
• Non-Executive Director, Mothercare plc
• Non-Executive Director, SIG plc
• Non-Executive Director, Marlowe plc
• Non-Executive Director, THG plc
Previous experience
• Non-Executive Director, Pendragon plc
• Non-Executive Director, NAHL Group plc
• Non-Executive Director, Dignity plc
86
Ascential plc Annual Report 2023
Mandy Gradden
Chief Financial
Officer
Rita Clifton
Senior Independent
Director
Appointed to the Board
January 2013
Independent
No
Appointed to the Board
May 2016
Independent
Yes
Committees
–
Meetings attended
14/14
Nationality British
Key areas of experience
Chartered accountant, corporate finance,
mergers & acquisitions, financial
restructuring, transformation.
Current external appointments
• Chair, Listing Authority Advisory Panel, FCA
• Non-Executive Director, Spectris plc
Previous experience
• Non-Executive Director, and
Chair of Audit Committee, SDL plc
• CFO, Torex Retail Holdings Limited
• CFO, Detica Group plc
• Telewest plc
• Dalgety plc
• Price Waterhouse
Committees
Meetings attended
13/14
Nationality British
Key areas of prior experience
Brands, brand strategy, business leadership,
global account sales, CPG voice of consumer.
Current external appointments
• Deputy Chair and Non-Executive Director,
John Lewis Partnership
• Chair, Forum for the Future
• Trustee, Green Alliance
Previous experience
• Non-Executive Director, Nationwide
Building Society
• Non-Executive Director, Asos plc
• Vice Chair and Strategy Director,
Saatchi & Saatchi
• CEO and Chair, Interbrand
• NED, Sustainable Development Commission
• Trustee and Fellow, WWF
Judy Vezmar
Non-Executive
Director
Appointed to the Board
January 2016
Independent
Yes
Committees
Meetings attended
11/14
Nationality American
Key areas of prior experience
Global portfolio leadership, talent
management, remuneration, voice of the
consumer, global account management
Current external appointments
• Engagement Non-Executive Director, SSP
Group plc
Previous experience
• CEO, LexisNexis International
• Executive, Xerox Corporation
• Non-Executive Director, Rightmove plc
87
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Governance
framework
How we comply with the
UK Corporate Governance Code
The UK Corporate Governance Code 2018 applied to Ascential
for the year ending 31 December 2023. This section of the report
explains how we have complied with the Code by summarising
the provisions of the Code and linking to where we describe how
we have complied in more detail.
Section 1: Board Leadership and Company Purpose
A successful company is led by an effective and entrepreneurial
board, whose role it is to promote the long-term sustainable
success of the company, generating value for shareholders and
contributing to wider society. (See the Directors’ biographies on
pages 86 to 87 for more information).
The Board should establish the company’s purpose, values and
strategy, and satisfy itself that these and its culture are aligned. All
Directors must act with integrity, lead by example and promote the
desired culture. (See the governance framework on pages 88 to 93
for more information).
In order for the company to meet its responsibilities to shareholders
and stakeholders, the Board should ensure effective engagement with,
and encourage participation from, these parties. (See the stakeholder
engagement section on pages 48 to 55 for more information).
The Board should ensure that workforce policies and practices are
consistent with the company’s values and support its long-term
sustainable success. The workforce should be able to raise any
matters of concern. (See the sections on ESG on page 77 and the
Whistleblowing section of the Audit Committee Report on page
101 for more information).
Section 2: Division of Responsibilities
The Chair leads the Board and is responsible for its overall
effectiveness in directing the Company. They should demonstrate
objective judgement throughout their tenure and promote a
culture of openness and debate. In addition, the Chair facilitates
constructive Board relations and the effective contribution of all
Non-Executive Directors, and ensures that Directors receive
accurate, timely and clear information (See the governance
framework on page 89 for more information).
The Board should include an appropriate combination of Executive
and Non-Executive (and in particular, Independent Non-Executive)
Directors, such that no one individual or small group of individuals
dominates the Board’s decision-making. There should be a clear
division of responsibilities between the leadership of the Board
and the executive leadership of the Company’s business. (See the
governance framework on page 89 for more information).
Non-Executive Directors should have sufficient time to meet
their Board responsibilities. They should provide constructive
challenge, strategic guidance, offer specialist advice and hold
management to account. (See the governance framework
on page 89 for more information).
The Board, supported by the Company Secretary, should ensure
that it has the policies, processes, information, time and resources
it needs in order to function effectively and efficiently. (See the
governance framework on page 91 for more information).
Section 3: Composition, Succession and Evaluation
Appointments to the Board should be subject to a formal, rigorous
and transparent procedure, and an effective succession plan
should be maintained for Board and senior management. Both
appointments and succession plans should be based on merit and
objective criteria and, within this context, should promote diversity
of gender, social and ethnic backgrounds, cognitive and personal
strengths. (See the Nomination Committee report on page 102 for
more information).
The Board and its committees should have a combination of skills,
experience and knowledge. Consideration should be given to the
length of service of the Board as a whole and membership
regularly refreshed. (See the Nomination Committee report on
page 102 for more information).
Annual evaluation of the Board should consider its composition,
diversity and how effectively members work together to achieve
objectives. Individual evaluation should demonstrate whether each
director continues to contribute effectively. (See the Chair’s
introduction to governance on page 83 and the Nomination
Committee report on page 103 for more information).
Section 4: Audit, Risk and Internal Control
The Board should establish formal and transparent policies and
procedures to ensure the independence and effectiveness of
internal and external audit functions and satisfy itself on the
integrity of financial and narrative statements. (See the Audit
Committee Report on page 95 for more information).
The Board should present a fair, balanced and understandable
assessment of the Company’s position and prospects. (See the
Audit Committee Report on page 98 for more information).
The Board should establish procedures to manage risk, oversee
the internal control framework and determine the nature and
extent of the principal risks the Company is willing to take in order
to achieve its long-term strategic objectives. (See the Risk
Management section on page 32 for more information).
Section 5: Remuneration
Remuneration policies and practices should be designed to
support the strategy and promote long-term sustainable success.
Executive remuneration should be aligned to company purpose
and values, and be clearly linked to the successful delivery of the
company’s long-term strategy. (See the Annual Statement from
the Chair of the Remuneration Committee on page 104).
A formal and transparent procedure for developing policy on
executive remuneration and determining director and senior
management remuneration should be established. No director
should be involved in deciding their own remuneration outcome.
(See the Directors’ Remuneration Report on pages 104 for
more information).
88
Ascential plc Annual Report 2023 Directors should exercise independent judgement and discretion
when authorising remuneration outcomes, taking account of
company and individual performance, and wider circumstances.
(See the Remuneration Report on page 104 for more information).
A strong governance framework
Role and operation of the Board
The Board has ultimate responsibility for the overall leadership of
Ascential. It oversees the development of a clear strategy, monitors
operational and financial performance against agreed goals and
objectives, and ensures that appropriate controls and risk systems
exist to manage risk.
The Board has agreed a schedule of matters reserved for its
decision or approval:
• Strategy, annual budgets and medium-term plans
• Annual and interim results
• Material acquisitions and disposals and contracts
• Establishment of risk appetite, review of principal risks and
approval of both
• Ensuring that a sound system of internal control and risk
management is maintained
• Changes relating to the Company’s capital structure
• Approval of dividend policy
Changes to Board composition
At the date of this report, the Board comprises seven Directors; the
Chair, the Chief Executive, the Chief Financial Officer and four
independent Non-Executive Directors. Paul Harrison resigned from
his position as Executive Director and Chief Operating Officer with
effect from 30 September 2023. Duncan Painter resigned from his
position as Executive Director and Chief Executive Officer and
Philip Thomas was appointed as Executive Director and Chief
Executive with effect from 2 January 2024. On the same date,
Charles Song and Joanne Harris resigned from their positions as
Independent Non-Executive Directors.
The biographies and experience of all of our Directors are set out
on page 86. With support from the Company Secretary, the Chair
sets the annual Board calendar and Board meeting agendas. He
ensures that enough time is devoted, both during formal meetings
and throughout the year, to discuss all material matters including
strategic, financial, operational, risk, people and governance. The
Directors indicated as part of the Board evaluation process that the
board materials are relevant, clearly presented and contribute to a
constructive debate and strong Board engagement.
In addition to the schedule of formal Board meetings, the Chair and
the Non-Executive Directors meet periodically without the Executive
Directors present, and the Senior Independent Director meets with
the other Non-Executive Directors without the Chair present.
Board roles
Chair
The Chair provides leadership to the Board, setting its agenda,
style and tone to promote constructive debate and challenge
between the Executive and Non-Executive Directors. He ensures
that there are good information flows from the Executive to the
Board, and from the Board to the Company’s key stakeholders.
The Chair leads an annual Board effectiveness review and is
responsible for ensuring all new Directors have an appropriate
tailored induction programme.
Chief Executive
The Chief Executive has day-to-day responsibility for the effective
management of the business and for ensuring that the Board’s
decisions are implemented. He leads the development of strategy
for approval by the Board, as well as working with the Chief
Financial Officer to develop budgets and medium-term plans
to deliver the agreed strategy.
The Chief Executive is responsible for providing regular reports to
the Board on all matters of significance, to ensure that the Board
has accurate, clear and timely information on all key matters.
Chief Financial Officer
The Chief Financial Officer supports the Chief Executive in
developing and implementing strategy, as well as overseeing the
financial performance of the Group. She leads the development
of the finance function to provide insightful financial analysis that
informs key decision-making.
The Chief Financial Officer works with the Chief Executive to develop
budgets and medium-term plans to deliver the agreed strategy.
The Chief Financial Officer also leads investor relations activities
and communication with investors alongside the Chief Executive.
Senior Independent Director
The Senior Independent Director acts as an adviser for the Chair
and is available to the other Non-Executive Directors, including
acting as an intermediary where necessary. She is also available as
an intermediary to shareholders if they have concerns which the
normal channels through the Chair or Chief Executive have failed
to resolve or would be inappropriate. She is also the nominated
director to engage with the Ascential Employee Forum and report
employee feedback to the Board.
Independent Non-Executive Directors
The Non-Executive Directors scrutinise and monitor the performance
of management, including the constructive challenge of the
Executive Directors. They bring independence and a different
perspective to the Board and oversee the integrity of financial
information, financial controls and systems of risk management.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Governance framework continued
Governance structure
Principal Board Committees
Audit Committee
Chaired by
Suzanne Baxter
Remuneration
Committee
Chaired by Judy Vezmar
Nomination Committee
Chaired by
Rita Clifton
Roles and responsibilities
• Reviews the Group’s financial
Roles and responsibilities
• Sets the Remuneration Policy for
reporting and recommends to the
Board that the Reports and Accounts
be approved
• Reviews and reports to the Board on
the effectiveness of internal controls
• Assesses the independence and
effectiveness of the internal and
external auditors.
the Group
• Sets the individual remuneration
of the Executive Directors and
senior management
• Engages and consults with
shareholders on proposed material
changes to Remuneration Policy
• Approves awards under the Group’s
share-based incentive plans.
Roles and responsibilities
• Reviews the composition of
the Board and its Committees
• Ensures that appropriate
procedures are in place for the
nomination, selection, training
and evaluation of Directors
• Reviews Executive Directors
and Senior Management
succession planning.
Audit Committee Report
Page 94
Remuneration Committee Report
Page 104
Nomination Committee Report
Page 102
Reinforcing a Healthy Culture
Established reporting mechanisms within the corporate governance framework are key to Board oversight of cultural matters, which
are underpinned by our beliefs and behaviours: focus, facts, all in, no silos, be creative, transparency, trust & openness, and empathy.
Culture is established by leadership and by example but this also needs to be underpinned by clear policies and codes of conduct.
Ethics, Whistleblowing, Fraud, Bribery
There is a full suite of formal compliance and
legal policies which all employees are subject
to, including Anti-Bribery, Privacy, Data Protection
and Sanctions. Employees can report incidents
of wrongdoing through both internal and
external mechanisms, including an anonymous
‘speak up’ tool. The Audit Committee monitors
and reviews the Company policies, incidents
and trends arising from any such incidents and
reports its findings to the Board.
Risk Management
Risk management is an integral component of
our corporate governance. We have a formal
risk management framework to manage risks
in accordance with the Board-set risk appetite.
The Audit Committee receives regular updates
on risk management and the Board reviews
the principal and emerging risks for the Group.
Our People’s opinions
We hold regular updates to both inform our
employees on business progress and answer
any questions they may have. We conduct
regular engagement surveys which help us
understand what people think so we can take
appropriate actions in a timely way. We have
also established the Ascential Employee Forum
which is Chaired by the Senior Independent
Director to ensure there is a direct route for
employee voice in the Boardroom.
Aligning remuneration and culture
The Ascential Beliefs and Behaviours are
directly incorporated into key people processes
such as performance appraisal and
development reviews. Both of these
processes focus not just on what has been
achieved, but how our people act and
demonstrate alignment to our values.
How the Board monitors culture
Measuring our culture
We measure compliance with our key policies
and procedures, as well as Health & Safety
incidents. Our employee engagement surveys
include specific questions that help us
measure our culture such as ‘if I experienced
serious misconduct at work, I’m confident
Ascential would take action to rectify the
situation’. We believe that this framework is an
important contributing factor to the high
scores we have measured in these areas.
Promoting the success of the Company
The Directors are fully aware of their duty to
promote the success of the Company for the
benefit of the members as a whole, having
regard to the interests of employees, the impact
of the Company’s operations on the community
and the environment, and maintaining a
reputation for high standards of business conduct.
The need to balance the interests of sometimes
conflicting stakeholders is an inherent part of
the Board’s decision-making processes. See
page 48 for more details on how the interests
of different stakeholders are managed.
90
Ascential plc Annual Report 2023 Company Secretary
The Company Secretary supports the Chair and is available to all
Directors to provide governance advice and assistance. She works
with the Chair and the Chairs of the Board Committees to develop
agendas and ensures that the Board receives sufficient, pertinent,
timely and clear information. She also ensures compliance with
the Board’s procedures as well as applicable rules and regulations.
The management and day-to-day running of the Group, including
the development and implementation of strategy, monitoring the
operating and financial performance, and the prioritisation and
allocation of resources, has been delegated to executive
management. Certain Board responsibilities are delegated to
formal Board Committees, which play an important governance
role through the work they carry out. Louise Meads stepped down
as Company Secretary with effect from 1 February 2024 and was
succeeded by Naomi Howden, who was previously the Deputy
Company Secretary.
Board activity during the year
The Board spent its time during the formal meetings held in 2023
on the following activities:
Strategy
• Concluded the strategic reviewed announced in April 2022
resulting in the disposals of Digital Commerce and WGSN in
January 2024 and February 2024 respectively, and a return
of value of £850m to shareholders to be delivered through
a combination of special dividend and on-market share
buy-back programmes.
• Approved the 2023 annual budget and, capital allocation
policy, and updated medium-term plans in the context of
the agreed strategy.
• Approved the strategy and investment case for Ascential
as a pure-play, events-led business.
For more information on our strategy see page 7.
People
• Met with a range of senior management
from across the business.
• The Chair participated as Chair of the jury for the annual
Ascential awards, designed to recognise performance across
the organisation and every geography.
• Received updates from the Chief Executive on engagement
and morale.
For more information on Our People see page 42.
ESG
• Received updates from the Head of Sustainability on
progress against the Company’s ESG priorities and targets.
• Approved Philip Thomas, Chief Executive, as the new Board
ESG sponsor and Kent Dreadon, COO, as the new ESG
executive sponsor.
• Approved ESG priorities for 2024.
For more information on our ESG strategy and performance
see page 56.
Risk
• Reviewed and approved the principal risk register.
• Reviewed the Group’s annual insurance programme
and arrangements for tail D&O cover in relation to the
disposed companies.
• Reviewed the effectiveness of internal controls, including
receiving a report from the Audit Committee on its work to
assess internal control effectiveness.
For more information on risk management see page 32.
Shareholder engagement
• Reviewed reports from the Company’s brokers
and advisers on shareholder and analyst feedback following
results presentations.
• Reviewed reports from the Company’s brokers, advisers and
executive management on shareholder feedback following
consultation on proposed methods of return of value.
• Reviewed regular investor relations reports relating to
share price, trading activity and movements in institutional
investor shareholdings.
• Received reports from the Executive Directors following
meetings with investors.
• Approved the shareholder circular and Notice of
General Meeting in relation to the disposal of Digital
Commerce and WGSN.
• Approved the Notice of 2023 Annual General Meeting. For more
information on our investor relations programme see page 92.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Governance framework continued
Performance
• Approved the 2023 budget and refreshed five-year plan.
• Monitored operating and financial performance against plans.
• Approved the year end and interim results.
• Approved the 2022 Annual Report.
For more information on our performance, see the Chief
Executive’s statement on pages 6 to 7, the Financial Review
on pages 24 to 31 and the KPIs on page 12.
Board attendance during the year
We expect all Directors to attend the majority of meetings in person
except where a meeting is called at short notice. Due to the
volume of additional Board meetings held in 2023 in connection
with the strategic review and disposal of Digital Commerce and
WGSN, Board meetings during the year were a combination of
in-person, hybrid and virtual meetings depending on the content
and duration of meetings. In the unusual circumstances when a
Director is unable to attend a meeting, he or she is provided with
the same information as the other Directors in advance of the
meeting and a meeting is arranged for that Director to express
their views before the meeting, usually to the Chair who will share
feedback with the other Directors at the meeting.
There were five scheduled meetings during the year plus an
additional 13 meetings which were called primarily to consider
items relation to the separation and sale of Digital Commerce
and WGSN. Directors’ attendance at these meetings is set out
on page 86.
Induction and development
There is an agreed induction programme that takes into account
any previous experience that a Director may already have and
typically includes meetings with senior executives across the
Group as well as information on the Group’s structure, business
segments and operations, and policies to develop each Director’s
understanding of the Group, its strategy, key risks and challenges.
The Board’s forward agenda is designed to include deep-dive
reviews on all material aspects of the Group to develop Directors’
understanding of the business and ensure they meet with a range
of senior management.
In preparation for his appointment as Chief Executive in January
2024, the Board initiated its transition plan during 2023 which
included, amongst other things, Philip’s attendance at Board and
Committee meetings as well as briefings from the Company’s
brokers and legal advisers. Philip was formerly the Chief Executive
Officer of Ascential Intelligence and Events and so has an existing
in-depth understanding of the Company’s business.
Directors’ conflicts of interest
The Board has a procedure in place for Directors to declare
conflicts of interest and for such conflicts to be considered for
authorisation. A Director may be required to leave a Board meeting
if a matter upon which a conflict has been declared is discussed.
External appointments or other significant commitments of the
Directors require prior approval by the Chair.
The current external appointments of the Directors are set out on
pages 86 and 87.
Internal Control Statement
The Board acknowledges its responsibility for establishing and
maintaining the Group’s system of internal controls and it receives
reports identifying, evaluating and managing significant risks
within the business. The system of internal control is designed
to manage, rather than eliminate, the risk of failure to achieve
business objectives and can provide only reasonable and not
absolute assurance against misstatement or loss.
The Board, assisted by the Audit Committee, has carried out
a review of the effectiveness of the system of internal controls
during the year ended 31 December 2023 and the period up to
the date of approval of the consolidated financial statements
contained in the Annual Report.
For more information on the system of internal controls in place
please see page 99 of the Audit Committee report.
Investor Relations
In addition to the activities explained on page 91, there is an
ongoing investor relations programme of meetings with
institutional investors and analysts, and participation in
conferences covering a wide range of issues within the constraints
of publicly available information including strategy, performance
and governance.
Institutional shareholders and analysts have regular contact with
the Executive Directors and the Head of Investor Relations. All
shareholders are kept informed of significant developments by
announcements and other publications on our website ascential.
com/investors. There are defined procedures in place to ensure
that the requirements of the Market Abuse Regulations are met.
The Board receives regular reports from the Head of Investor
Relations, covering movements in the holdings of institutional
shareholders and other trading activity. The Board is also provided
with current analyst opinions and forecasts, as well as feedback
from FTI and from its joint corporate brokers Numis and JP Morgan.
This includes direct feedback from investors and analysts on a
non-attributed basis. All of the Directors are available to meet with
shareholders although contact with the Non-Executive Directors
would normally be through the Chair (Scott Forbes) or the Senior
Independent Director (Rita Clifton) in the first instance.
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Ascential plc Annual Report 2023 Annual General Meeting (“AGM”)
The AGM of the Company will take place at 9am on Thursday
9 May 2024 at the Rosewood Hotel, London, 252 High Holborn
WC1V 7EN. All shareholders have the opportunity to attend and
vote, in person or by proxy, at the AGM.
All proxy votes received in respect of each resolution at the AGM
are counted and the balance for and against, and any votes
withheld, are indicated. At the meeting itself, voting on all the
proposed resolutions is conducted on a poll rather than a show
of hands, in line with recommended best practice.
All Directors will be in attendance at the AGM and available to
answer shareholders’ questions. The Notice of the AGM can be
found in a separate booklet which is posted to shareholders at the
same time as this report and is also available on the Ascential
website. The Notice of AGM sets out the business of the meeting
and an explanatory note on all resolutions. Separate resolutions
are proposed in respect of each substantive issue. Results of
resolutions proposed at the AGM will be published on the
Ascential website after the meeting.
UK Corporate Governance Code Compliance
Statement
We have complied with all principles and provisions of the 2018 UK
Corporate Governance Code (“the Code”) throughout the
financial year ended 31 December 2023.
This Corporate Governance Statement and the cross-referenced
reports within set out our approach to applying the Code.
Naomi Howden
Company Secretary
25 March 2024
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Report of the
Audit Committee
Suzanne Baxter
Chair of the Audit Committee
The accounting and governance
implications of the Company’s strategic
review have been a particular area of
focus for the Committee and have made
for a busy and interesting year.”
Dear Shareholder,
As Chair of the Audit Committee, I am pleased to present the
report of the Committee for the year ended 31 December 2023.
In this year of significant strategic change for Ascential, the
Committee has provided considerable oversight and input on the
preparation of financial information required for the divestment of
WGSN and the Digital Commerce businesses alongside fulfilling
its wider corporate governance responsibilities. As part of
Ascential’s preparation to position itself to execute the conclusions
of its strategic review, our Finance team has had additional areas of
focus this year, undertaking substantial legal entity restructuring,
a programme of intercompany rationalisation and analysis of
distributable reserves to prepare for the return of value to
shareholders. These transactions and analysis require specific
technical accounting expertise and the Committee has met with
and challenged external advisers, overseen the procedures and
analysed and challenged the judgements that have been taken.
In addition, given the early phase of the strategic review
contemplated the listing of the Digital Commerce business on
a US regulated financial market, the Committee considered the
implied governance and audit requirements and took account
of the considerable PCAOB audit work being undertaken by
the external auditor within that business.
The Committee has continued to review the development of the
control environment across the Group and has been cognisant of
the impact of the disposals to ensure no adverse impact on the
control environment for the retained events-led business. The
Committee will monitor the implementation of the UK Corporate
Governance Code 2024 and the changing ESG reporting
requirements and will ensure Ascential’s accounting and
compliance frameworks evolve to meet the new requirements.
To assist with internal resourcing allocation during the year and
to ensure the continuity of the internal audit programme to
complement the activities of the strategic review, the Committee
made the decision to move from a co-sourcing arrangement to
a fully out-sourced internal audit function, provided by EY. The
Committee sets the internal auditor’s plan for the year, and
monitors and reviews its work and its assessment of the
effectiveness of controls.
I would like to thank my fellow Committee members, Gillian Kent
and Rita Clifton, for their continued support, considered input into
our meetings and market practice insight which is greatly
appreciated. My thanks also to those members of the senior
management team who attend Committee meetings and bring
us closer to key points of operational control in the business.
The Committee’s core duties comprise:
• the oversight of the Company’s financial and narrative reporting
processes, including consideration of the annual and half-yearly
reports and assessment of the Company’s accounting policies and
whether its annual report is fair, balanced and understandable;
• consideration and monitoring of the effectiveness of the
Company’s internal controls and risk management systems;
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Ascential plc Annual Report 2023 • oversight of procedures to assure Compliance, to report
instances of whistleblowing and to detect fraud;
• monitoring and assessing the effectiveness of the internal audit
function; and
• oversight and approval of the engagement of the external auditor,
and evaluation of the quality and effectiveness of its work.
The Committee’s terms of reference were reviewed and approved
by the Board during the year and are available on the Company’s
website ascential.com/investors/governance.
Committee membership
All current members of the Committee are independent Non-
Executive Directors who bring a wide knowledge and business
experience in financial reporting, risk management, internal
control and strategic management. You can read more about
the experience of the Committee members in their biographies
on pages 86 and 87. I fulfil the requirement to bring recent and
relevant financial experience to the Committee having significant
financial experience in several sectors. The Board is satisfied that
the Committee members as a whole have knowledge and
competence relevant to Ascential’s business. The Committee
members’ financial and business experience allows for effective
discussion, challenge where appropriate and oversight of critical
financial matters. All other Non-Executive Directors have an open
invitation to attend Committee meetings.
Meetings and attendance
All Committee members were present at the 12 meetings held
in 2023. The Committee has met three times since 31 December
2023 and all Committee members attended those meetings.
At the invitation of the Committee, the Chief Financial Officer,
Chief Executive Officer, Chief Operating Officer and senior
representatives of the finance and management teams also attend
meetings, as do representatives of both internal and external audit.
The Committee holds regular meetings with the external auditor
and Internal Audit representatives without management present,
and these discussions assist in ensuring that reporting, and risk
management processes are subject to rigorous review throughout
the year. The Committee also meets with management without
the external auditor present when discussing external auditor
effectiveness. In addition, I held private meetings with the external
audit partner and separately with management to discuss key
agenda matters and the status of audit work.
Risk management
The principal and emerging risks facing the Company are robustly
assessed by the Board as a whole. More detail on these risks and
the risk management framework is set out on page 32. The ongoing
monitoring and effectiveness review of the Company’s risk
management and internal control systems are described on page
99. The assessment of risk and the review of the risk management
systems feeds into the process for assessing the longer-term
viability of the Group, which is described further on page 34.
Evaluation of Committee performance
The Committee conducts an annual evaluation of its performance
as part of the wider Board effectiveness review. The review of
performance in 2023 was conducted internally and confirmed that
the Committee is working effectively. More detail on the
evaluation process can be found in the Corporate Governance
Report on page 103.
Key areas of focus for the Committee in 2023
The key focus areas for the Committee are set out below and
reflect its planned and recurring activities and areas of specific
focus during the year.
a. Financial reporting
• Received and considered reports from management on the key
estimates and judgements made in the half-yearly report and in
the annual consolidated financial statements. The Committee
challenged the assumptions made, discussed alternative
treatments, reviewed proposed disclosures, and considered the
opinion and work performed by the external auditor and other
professional advisors.
• Reviewed and challenged management’s forecasts, stress tests and
assumptions in support of the use of the going concern basis for
preparation of the Annual Report and Accounts and half-yearly report.
• Reviewed the quality of accounting policies and disclosure rules
and considered if those were applied consistently during the
reporting and comparative periods.
• Reviewed the integrity of the Company’s Annual Report and
Accounts and half-yearly report and advised the Board whether,
in the Committee’s view, the Annual Report taken as a whole is
fair, balanced and understandable and provides the information
necessary for shareholders to assess Ascential’s position and
performance, business model and strategy.
• Recommended to the Board the Company’s viability statement
included in the Annual Report.
b. Internal audit
• Approved the internal audit function’s remit and the annual
internal audit plan, which includes a focus on intercompany
transactions, IT general controls and cyber security, aligning it
with the Company’s strategic objectives and risks.
• Reviewed the significant matters arising from internal audits and
assessed management’s response to significant internal audit
findings and notable control observations. This includes discussing
with management potential improvements and agreed actions.
• Assessed internal audit’s performance and effectiveness.
c. Risk management and Internal control
• Reviewed the effectiveness of the systems of internal control
and risk management, including the integration of those
controls into the recently acquired Contagious businesses.
• Recommended to the Board the disclosures included
in the Group’s Annual Report in relation to internal control
and risk management.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Report of the Audit Committee continued
• Received progress updates on the implementation of the
• Reviewed the historical and pro forma Class 1 financial
information prepared by management including the allocation
of costs and presentation of deferred tax assets.
• Reviewed the processes and conclusions drawn by
management in assessing the distributable reserves available
to enable a return of value to shareholders to be made.
• Reviewed the process and advice taken by management
as part of the intercompany reorganisation including the
controls and procedures undertaken to ensure legal
compliance and tax optimisation.
• Considered the restructuring of the Company’s investment in
Hudson and the implications on the assessment of whether the
Group has control or significant influence over the investment.
• Reviewed the group acquisition accounting for Hudson
following the determination of control, including the
appropriateness of associated valuations.
• Reviewed management’s assessment of whether
Hudson met the requirements to be disclosed as held for sale
and a discontinued operation in the annual consolidated
financial statements.
• Considered the impact of the new criminal offence of failure
to prevent fraud and the adjustments needed to the Group’s
compliance framework to ensure full compliance and requested
and received a briefing on that from EY.
Significant financial judgements and estimates
considered by the Committee in 2023
Over the course of the year, the Committee received management
papers setting out judgements and estimates made in preparing
the annual report and accounts. The most significant judgements
on which the Committee spent its time during the year are detailed
below. Other areas of judgement and estimation considered by the
Committee included going concern and viability, accounting for
the sales of the Digital Commerce and WGSN businesses, the
carrying value of goodwill and intangible assets, taxation and the
presentation of the financial statements including the use and
disclosure of Alternative Performance Measures. In the course of its
review, the Audit Committee considered the approach adopted by
management, requested and received clarifications from
management and sought and discussed papers from the external
auditor. Following its review and after due consideration, the Audit
Committee was satisfied with the accounting treatment and
disclosures adopted for each of the matters below.
Group’s finance transformation plan of enhancing the control
and reporting environment through the replacement of its
existing suite of financial accounting systems with a new ERP
system in the Digital Commerce business.
• Considered the progress made and financial implications
of the acquisition of Contagious during the year.
d. Compliance and governance
• Received an update from the Director of Compliance setting
out compliance priorities for 2023 and discussing the
effectiveness of the Compliance Framework, Speak Up Tool
and The Ascential Code during 2023.
• Reviewed the Group’s reporting on climate change including
compliance with the updated TCFD disclosure requirements
and guidance, and receipt of the auditor’s observations on
climate change reporting. The Committee noted the enhanced
disclosures on climate change in the 2023 annual report and the
Group’s commitment to continue to focus on this area.
• Reviewed the Committee’s terms of reference and its annual
schedule of work.
e. External audit
• Reviewed and monitored the qualifications, expertise, resources,
independence and objectivity of the external auditor.
• Reviewed the plans and received the reports of the external
auditor at the half year and year end.
• Considered the annual external audit plan and approved related
remuneration, including fees for audit and non-audit services.
• Considered the impact of the strategic review on work
undertaken by the auditor.
• Approved the appointment and remuneration of KPMG as
reporting accountant for the Class I circular and reviewed their
work, opinions and fee levels.
• Held private meetings with the Company’s external auditor
without the presence of management.
• Assessed the performance and effectiveness of the external
auditor and the audit process, including an assessment of the
quality of the audit.
• Recommended to the Board that resolutions to reappoint the
external auditor and for the Board to determine the external
auditor’s remuneration be put to shareholders for approval
at the next Annual General Meeting.
This year, additional focus was applied in the following areas:
• Received and considered management’s working capital
memorandum supporting the statements made in the Class 1
Circular, with particular focus on the key assumptions made and
mitigating factors applicable in downside scenarios. The
Committee also considered KPMG’s working capital report,
which focussed on the regulatory requirements, and sought
legal advice on the standard of comfort required to support
management’s statement.
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Ascential plc Annual Report 2023 Issue
Committee’s activity and outcome
Accounting for the
Company’s investment
in Hudson MX
Classification of the investment as a controlled subsidiary or equity accounted associate
Context: Due to the nature of the Company’s investments in Hudson and the transactions completed in February and October 2023,
management has been required to assess whether the Group had control of the Hudson business under IFRS 10 “Consolidated
Financial Statements” or else significant influence over that business under IAS 28 “Investments in Associates and Joint Ventures” at
a number of points during the year. Management has been assisted by external experts in determining the valuation of Hudson, the
valuation of financial instruments relating to Ascential’s investment in Hudson and in the application of accounting standards.
What we did: The Committee reviewed management’s technical accounting assessments for key Hudson-related events and
commercial arrangements in order to understand the key facts, relevant events and technical accounting judgment areas
relating to the classification of the Company’s investments in Hudson during the year.
Where we challenged: The key judgements and challenges from the Audit Committee related to the changing nature and
effect of the rights and obligations relating to the Company’s investments in Hudson following the February 2023 refinancing
and in entering into new investment arrangements in October 2023. The Committee interrogated management’s presentation
which considered whether the February instruments were substantive and therefore conveyed potential voting or other rights
with the ability to provide Ascential with power over the relevant operating activities and governance of Hudson. The analysis
of power in respect of the October 2023 instruments was less nuanced, with clear potential majority voting power conveyed
by these substantive instruments.
What other options were considered: The Committee considered whether Hudson could be considered to be controlled by
Ascential during the year through the potential exercise of power from its other rights and obligations connected to Hudson.
For example, its financing interests, protective investor rights and Board seats. It also considered whether there had been any
weakening of Ascential’s influence over Hudson that would undermine the presentation of the Company’s investment as an
equity accounted associate.
What happened as a result: Having considered management’s responses, and having consulted with the Group’s external
auditor, the Committee agreed with management’s assessment that Hudson should be accounted for as an equity-accounted
associate from the period from 1 January to 30 October 2023 and as a consolidated subsidiary thereafter.
Presentation of Hudson as a discontinued operation and as held for sale
Context: On 30 October 2023, it was announced that the Board of Hudson had initiated a sale of the Hudson business.
Management was required to review the relevant fact pattern for the proposed sale of the business against the criteria within
IFRS 5 “Non-current Assets Held for Sale and Discontinued Operations” and to consider its impact on the presentation of the
results of Hudson in the Company’s accounts.
What we did: The Committee inquired of management on the status of the sale process and the expected timetable for sale,
reviewed technical accounting papers setting out the basis for the treatment of the results of Hudson in the Company’s
accounts. The Committee also reviewed management’s proposed disclosure and considered whether the presentation and
disclosure of the financial impact of accounting for Hudson within the financial statements was appropriate.
Where we challenged: Key challenges considered by the Committee were whether completion of the sale of Hudson within
the next twelve months was highly probable and whether the business had been acquired with an exclusive view to sell. Further
to this, given the concurrent held for sale and discontinued operation presentations of Digital Commerce and WGSN, the
Committee challenged precisely which items should be shown in these categories in order to apply the relevant accounting
standards and present financial statements that were balanced and relevant to the user.
What other options were considered: The Committee challenged management whether the decision to hold for sale
crystallised at the point of acquisition or whether it crystallised later in the year.
What happened as a result: The Committee, having challenged management, considered the facts relating to the Company’s
interests in Hudson and their planned disposal, and consulted with the Group’s external auditor, agreed with management’s
assessment that Hudson should be classified as held for sale and as a discontinued operation from 30 October 2023.
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Issue
Committee’s activity and outcome
Accounting for the
Company’s investment
in Hudson MX
continued
Carrying value of the Company’s investment in Hudson
Context: The accounting that establishes the carrying value of the Company’s investments in Hudson requires, and relies on, the
valuation of a number of assets and liabilities for which there is no actively traded market or over the counter pricing, and for which
inputs to the valuation techniques applied are not readily observable. Therefore, there is a high degree of subjectivity over estimates
made in concluding on the valuation of the Hudson investments and the amounts at which they are held in the Company’s balance
sheet. To establish the carrying value of the Company’s investment in Hudson over the course of the year, management
considered valuations of the Hudson business at relevant transaction and reporting dates as well as the valuations of the financial
instruments granted to and impacting Ascential’s investments structures, such as the options over Hudson common stock.
What we did: The Committee sought to understand the basis of the valuations used by management to establish and assess
the carrying value of the Company’s investments in Hudson at relevant points during the year and at the year end. Management
engaged third party specialists to prepare the relevant valuations. The Committee reviewed management’s report on the key
assumptions, valuation techniques and sensitivity analysis conducted and consulted with the Group’s external auditors to
understand their technical perspective on the conclusion of the valuation work and on the valuation methodology. The
Committee reviewed the acquisition accounting outputs, underlying estimates and assumptions for Hudson when it was
reclassified as a subsidiary after control was acquired during the year and the impact of applying the relevant business and
financial instrument valuations at the year end. It also considered the impact of the decision to both acquire and dispose of
interests in Hudson on the same day on the Company’s accounting and its disclosures. The Committee considered the
judgements made and the advice provided to management by third party experts in reaching their conclusions and the
proposed disclosures.
Where we challenged: The Committee challenged management on the key inputs, valuation methodology and the overarching
commercial rationale for the valuations including whether alternative inputs were appropriate. The Committee questioned the
Company’s approach to the relevant valuations, the timing, impact and ordering of events on the carrying values adopted in the
accounts and the financial drivers of the loss in investment carrying value that occurred in October 2023. The Committee also
considered the ability of the user of the financial statements to understand the impact of the transactions, judgements and
valuation estimates made and the appropriateness of management’s proposed disclosures.
What other options were considered: The inputs into the valuations and draft disclosures were considered for appropriateness
in order to consider and highlight the sensitivity of the valuation to an investor.
What happened as a result: After challenging management on their judgements and methodology and receiving reports from
the Group’s external auditor, the Committee was satisfied with the positions, disclosure and valuations adopted in respect of the
Company’s investments in Hudson.
Viability Statement
The Committee reviewed the process undertaken and conclusions
reached to support the Company’s Viability Statement which can
be found in full on page 34.
Our review included:
• challenging management on whether the three-year time
period adopted remained appropriate and aligned with the
long-term forecasting of the Group;
• challenging whether management’s assessment of the principal
and emerging risks facing the Group and their potential impact
was appropriate;
• considering whether there were any additional risks which could
impair solvency or which, whilst not necessarily principal risks in
themselves, could become severe if they occur in conjunction
with other risks;
• considering the likelihood of the risks occurring in the time
period selected and the impact severity in the event that they
did occur;
• challenging management as to the appropriateness of the
assumptions used in stress testing and modelling scenarios;
• reviewing the disclosure to ensure it was sufficiently fulsome
and transparent.
Fair, balanced and understandable
The Board asked the Committee to consider whether the 2023
Annual Report is fair, balanced and provides the necessary
information for shareholders to assess the Company’s position and
prospects, business model and strategy. In performing this review,
the Committee received a report from management and
considered if it meets the requirements of 2018 UK Corporate
Governance code including the following considerations:
•
Is the Annual Report open and honest with the whole story
being presented?
• Have any sensitive areas been omitted that are material?
•
•
•
Is there consistency between different sections of the Annual
Report, including between the narrative and the financial
statements, and does the reader get the same message from
reading the two sections independently?
Is there a clear explanation of key performance indicators and
their linkage to strategy?
Is there a clear and cohesive framework for the
Annual Report with key messages drawn out and written
in accessible language?
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Ascential plc Annual Report 2023 • Specifically for 2023, have the rationale, implications and
components of the strategic review been clearly communicated
and can the reader understand the risks and trading
performance of the continuing business?
Alternative, targeted controls assessment and improvement
initiatives were adopted in respect of discontinued operations, with
a detailed paper from management setting out the nature and
effectiveness of those activities.
•
Is there an appropriate balance between the use of statutory
accounting measures and the use of APMs, and are APMs
clearly explained?
Following this review, and the incorporation of the Committee’s
comments, we were pleased to advise the Board that, in our view,
the Annual Report is fair, balanced and understandable in
accordance with the requirements of the UK Corporate
Governance Code.
Internal controls
The Board, with the assistance of the Audit Committee, regularly
monitors and reviews the policies and procedures making up the
Group’s internal control and risk management system. To support
this monitoring, the Audit Committee reviewed reports from
senior management, Internal Audit and KPMG.
The major components of the internal controls systems include:
• clearly defined operational structure, accountabilities and
authority limits;
• detailed operational planning and forecasting;
• thorough monitoring of performance and changes in outlook; and
• established risk management processes.
Specific matters considered in relation to controls
effectiveness included:
• controls self-assessment process and findings;
•
internal audit reports;
• regular compliance reports;
• review of tax risks and compliance issues;
• review of treasury controls;
• review of tax controls;
• the Corporate Criminal Offences risk assessment;
implications of disposals;
• key developments in IT controls;
• monitoring of the Finance Transformation programme;
• fraud, ethical issues and whistleblowing occurrence;
• health & safety governance; and
• management of legal claims.
A formal control self-assessment process was in place throughout
the year in relation to financial controls for the continuing
businesses. This process describes each control objective, the
controls required to meet the objective, the frequency of operating
the control and the evidence to be retained by management to
demonstrate the control exists. Management teams across the
Group self-assess and provide formal sign-off of their compliance
with this framework twice a year and the results are reviewed in
detail by Internal Audit.
Progress towards completion of actions identified to improve
internal control is regularly monitored by management and the
Audit Committee, who provide assurance to the Board. The Board
considers that none of the areas of improvement identified
constitute a significant weakness.
Following the disposals of WGSN and Digital Commerce
businesses, it is acknowledged that adjustments may be needed
to the systems of control to adapt to the new risk profile of the
retained events-led business. The Committee is supportive of the
steps being taken by management to address this, including a
review of the relevant risks going forwards, and will continue to
monitor progress in this area. The internal audit programme for
2024 includes a focus on the key cost areas together with risks
related to IT general controls and fraud.
External audit
The Committee is responsible for ensuring that the external
auditor provides an effective source of assurance for the Group’s
financial reporting and controls, including that the necessary
independence and objectivity is maintained. It is also responsible
for recommending the appointment, reappointment or removal
of the external auditor, and agreeing the external audit fees.
The proposed audit fee for the year ended 31 December 2023 was
debated between the Committee Chair, the CFO and the KPMG
audit partner, before being presented to the Committee.
The total fee paid to the Auditor in 2023 increased from £4.5m to £7.9m:
Audit of consolidated financial statements
Audit of the Group’s subsidiaries – Digital
Commerce separation
Audit of the Group’s subsidiaries – other
Total
2023
(£m)
3.4
3.2
0.4
0.9
7.9
2022
(£m)
1.3
2.8
0.2
0.2
4.5
The work to support the separation of WGSN and Digital Commerce
is classified as audit work and approval to engage KPMG for this
purpose was sought and obtained from the Committee in 2022 after
due consideration of matters of independence. The Committee
was satisfied that KPMG’s appointment did not compromise their
independence with respect to their appointment as the external
auditor to Ascential plc. This year, the Committee has also been
consulted on, and approved, the appointment of KPMG as reporting
accountants for the Class 1 circular and demerger of Digital
Commerce and WGSN.
The Committee approved the selection of KPMG to conduct the
PCAOB audit work in advance of a potential listing of the Digital
Commerce business on a US regulated exchange. With its
international presence, experience of both the business and the
transaction envisaged, it was felt KPMG was best placed to provide
the relevant services.
99
• review of integration of acquisitions and the
Audit-related assurance services
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Report of the Audit Committee continued
The Group last undertook a formal tender of external audit
services in 2019 after which KPMG were reappointed for a second
term. Christopher Hearn was appointed as Senior Statutory
Auditor with effect from the 2022 audit onwards. KPMG attends
each scheduled meeting of the Committee and presents their
reports on our half-year and full-year financial results, as well as
their planning reports in advance of each audit. The Committee
met with KPMG without management present at each physical
Committee meeting held during the year. These sessions provide
an opportunity for open dialogue and the Committee typically
discusses KPMG’s relationship with executive management and
particular audit risks identified. The Committee Chair also met
regularly with the Audit Partner on a one to one basis. The
Committee also meets with management without KPMG
present to discuss their view of KPMG’s effectiveness and
quality of work delivered.
As part of the Committee’s work to manage the external auditor
relationship, and the annual effectiveness review, the Committee
considers whether there are adequate safeguards to protect
auditor objectivity and independence. In conducting our annual
assessment, the Committee considers feedback from the Chief
Financial Officer, the level and nature of non-audit fees accruing to
the external auditor, fees in respect of KPMG’s PCAOB audit work,
KPMG’s formal letter of independence, and the length and tenure
of the external auditor and of the audit engagement partner.
The Committee concluded that the external auditor remained
independent within the meaning of regulatory and professional
requirements and the objectivity of the partner and audit staff is
not impaired.
The Committee specifically considered the classification of
KPMG’s work as either audit or non-audit work, the related fees
of each piece of work and the total fees being paid to the external
auditor relative to the regulatory cap that requires that permissible
non audit fees should not, in the ordinary course, exceed 70%
of the average of statutory audit fees for the past 3 years. The
Committee also sought KPMG’s assurance that its work and fees
properly complied with independence requirements and were
within the limits of the cap.
The Committee has approved a formal non-audit services policy
to mitigate any risks threatening, or appearing to threaten, the
external audit firm’s independence and objectivity arising through
the provision of non-audit services.
The non-audit services policy sets out which services are
permitted, subject to relevant approvals, and which services
are prohibited and cannot be provided by the external auditor.
Permitted non-audit services include services required by law or
regulation, or where it is probable that an objective, reasonable
and informed third party would conclude that the auditor’s
understanding of the Group is relevant to the service, and the
nature of the service would not compromise independence.
Permitted non-audit services must be pre-approved subject
to the following limits:
Value of non-audit services
Up to £25,000
£25,001 – £50,000
Above £50,000
Approval required prior to
engagement of the external auditor
EVP, Group Finance
or Chief Financial Officer
Chair of the Audit Committee
The Audit Committee
When reviewing requests for permitted non-audit services, the
person approving the engagement will assess:
• Whether the provision of such services impairs the auditor’s
independence or objectivity and any safeguards in place to
eliminate or reduce such threats;
• The nature of the non-audit services;
• Whether the skills and experience make the auditor the most
suitable supplier of the non-audit services;
• The fee to be incurred for non-audit services, both for individual
non-audit services and in aggregate, relative to the Group audit
fee; and
The criteria which govern the compensation of the individuals
performing the audit.
A breakdown of total audit and non-audit fees paid to KPMG
during 2023 is set out in Note 5 to the financial statements.
These non-audit services were pre-approved in accordance
with the non-audit services policy.
100
Ascential plc Annual Report 2023 The Speak Up tool enables anonymous disclosures, where this
is permitted by local laws. The tool also serves as an effective
business intelligence tool allowing the tracking, allocation and
investigation of cases and incidents effectively and consistently.
The Speak Up process also provides a confidential third-party
helpline should employees prefer to speak to someone rather
than use the online tool.
The Committee receives reports on the Ascential code, speak up
tool and on any whistleblowing incidents that are reported during
the year. Any significant issues relating to potential fraud would be
escalated to me as the Audit Committee Chair immediately.
Despite the backdrop of significant strategic change this year,
the compliance assessment results for this year showed further
incremental improvements in Ascential’s overall compliance
effectiveness scores demonstrating the positive impact of the
compliance framework that was implemented into the
organisation in 2019. The Committee recognises that following
the conclusion of the strategic review, management will need
to review the compliance concerns of the retained events-led
business and adjust the compliance framework to manage the
ongoing compliance risk.
I will be available at the Company’s AGM to answer any questions
on the work of the Committee.
Suzanne Baxter
Chair of the Audit Committee
25 March 2024
Internal Audit
A formal Internal Audit function was in place during the year,
initially utilising a co-sourcing arrangement supported by EY as the
Group’s externally appointed service partner and later in the year
moving to a fully out-sourced function, provided by EY.
The purpose of the Internal Audit function is to consider whether
the system of internal control is adequately designed and
operating effectively to respond to the Group’s principal risks,
and to provide independent objective assurance to senior
management and to the Board through the Audit Committee.
Internal Audit accomplishes its objectives by bringing a systematic,
disciplined approach to evaluate and improve the effectiveness of
risk management, control and governance processes. In order to
provide a greater level of independence for Internal Audit, the
function reports to the Chief Operating Officer who is
accountable to the Committee in respect of that role. The
Chief Operating Officer is invited to attend all Audit Committee
meetings and also meet independently with the Chair of the
Audit Committee.
The Committee approves the annual Internal Audit Plan
and receives a report on Internal Audit activity and progress
against that Plan. It monitors the status of internal audit
recommendations and management’s responsiveness to their
implementation. It also challenges management where
appropriate to provide us with assurance that the Group’s
control environment is robust and effective.
Compliance Framework
Ascential has in place a group-wide compliance framework which
facilitates a structured and consistent approach to managing
compliance across the group. The Director of Compliance reports
formally to the Committee on this compliance framework at least
annually. The framework is structured upon key areas of
compliance with appropriate policies governing each area.
The Ascential Code is core to the group-wide compliance
framework as it encourages all colleagues to operate in the
context of ethics and compliance, empowers employees to
thoughtfully handle any ethical dilemmas they may encounter,
and provides contact points and other resources related to
compliance. Employees are required to undertake a mandatory
training module on the Ascential Code to embed knowledge and
understanding of the Code as well as to track engagement.
101
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Report of the
Nomination Committee
Rita Clifton
Chair of the Nomination Committee
The role of the Nomination
Committee is primarily to
keep the structure, size and
composition of the Board and
Committees under review
with the primary objective
of matching the skills,
knowledge and experience
of Directors to our business
strategy and requirements.”
Dear Shareholder,
I am pleased to introduce the Report of the Nomination
Committee for 2023.
The role of the Nomination Committee is primarily to maintain
and evolve the structure, size and composition of the Board and
Committees with the primary objective of matching the skills,
knowledge and experience of Directors to our business strategy
and other requirements.
Board composition and succession planning
During 2023, it was agreed that Joanne Harris and Charles Song
would step down from the Board upon completion of the sale of
Digital Commerce as their initial appointments and primary areas
of expertise related to commerce, retail and Asian businesses.
Duncan Painter stepped down as Chief Executive on 2 January
2024 to join Omnicom and lead the Flywheel business. Through
the Board’s investment in career development as part of its
programme of organisation and succession planning, the Board
appointed Philip Thomas with confidence as Duncan’s successor
as Chief Executive of Ascential post the sales of Digital Commerce
and WGSN. The Board initiated its transition plan and oversaw an
orderly transition of leadership responsibilities. Philip was formerly
the Chief Executive Officer of Ascential Intelligence and Events
and is well placed to lead Ascential as an events-led business.
With the support of a globally recognised search firm, the
Committee evaluated the diversified array of capabilities,
experience and background relevant to a focussed, high-quality
events-led business. The Committee is also cognisant of the need
to replace four long-tenured directors who would typically resign
at the May 2025 AGM after completing their ninth year of board
services in accordance with best practice. The Committee is
seeking to appoint several directors in 2024 to enable a smooth
transition of outgoing and incoming directors.
102
Ascential plc Annual Report 2023 Board appointments policy
Board effectiveness
The most important priority of the Committee has been, and
will continue to be, ensuring that members of the Board should
collectively possess the broad range of skills, expertise and
industry knowledge, and business and other experience, necessary
for the effective oversight of the Group. The Committee takes
account of a number of factors before recommending any new
appointments to the Board, including relevant skills to perform the
role, experience, knowledge and diversity.
It will continue to be the Board’s policy to engage an independent
search consultant to assist with the identification of suitable
candidates based on a comprehensive role description and
candidate attributes brief. Shortlisted candidates will then meet
with members of the Board on a one-to-one basis before the
Committee makes its recommendation of the preferred candidate
to the Board.
Non-Executive Director appointments to the Board are for an initial
term of up to three years. Non-Executive Directors are typically
expected to serve two three-year terms, although the Board may
invite the Director to serve for an additional period on the
recommendation of the Committee. Non-Executive Directors are
appointed under formal appointment letters which are available for
inspection at the registered office of the Company during normal
business hours and at the AGM.
External Directorships
The Committee keeps under review the number of external
directorships held by each Director and performance evaluation is
used to assess whether the Non-Executive Directors are spending
enough time to fulfil their duties. Any external appointments or
other significant commitments of the Directors require the prior
approval of the Chair, or, in the case of the Chair, the Senior
Independent Director. The Chair takes into account investors’
published voting policies on the number of board mandates
considered appropriate for directors when considering directors’
proposed appointment to additional boards.
The policy on Board effectiveness reviews is that an externally led
evaluation of the Board, Committees and individual Directors will
be conducted every third year. This was conducted in respect of
the year to 31 December 2022 and accordingly an internal Board
evaluation was conducted in respect of 2023.
The themes from the review were that the Board was led by a
strong Chair, who sets the right tone for positive debate and
effectively involves the Board, leadership team and advisors at
appropriate times between formal Board meetings. The strategic
review and subsequent transactions required significant additional
time and engagement from Non-Executive Directors who
demonstrated their commitment and flexibility during the year.
The Executive Directors and leadership team maintained very high
quality of information provided to the Board to inform its debate
and decision-making, notwithstanding the inevitable complexity
and time demands generated by the strategic review and
subsequent divestments.
Confirmation of Independence
In accordance with the UK Corporate Governance Code, the
Committee is chaired by the Senior Independent Director, Rita
Clifton, and the other members of the Committee are the Board
Chair, Scott Forbes, and Suzanne Baxter and Judy Vezmar who
are both independent Non-Executive Directors.
Rita Clifton
Chair of the Nomination Committee
25 March 2024
103
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Report of the
Remuneration Committee
Dear Shareholder,
On behalf of the Board, I am pleased to present the Remuneration
Committee’s report for the year ended 31 December 2023.
What does this report include?
In addition to my annual statement as Chair of the Remuneration
Committee, this report contains:
• A summary of the Directors’ Remuneration Policy which was
approved by shareholders at the 2023 AGM; and
• The Annual Report on Remuneration, which sets out payments
made to the Directors for the year ended 31 December 2023
and how our Remuneration Policy is intended to be
implemented in 2024.
This annual statement and the annual report on remuneration
(set out on pages 115 to 125) will be subject to an advisory vote
at the 2024 AGM.
Judy Vezmar
Chair of the Remuneration Committee
Business context
We are proud of the entire team
for delivering excellent results
and growth this year. Our focus
in rewarding this performance
continued to be through clear and
simple remuneration plans.”
As set out in the Strategic Report, 2023 was a pivotal year for
Ascential as we implemented our strategic plan to deliver a
managed separation of our businesses, including the Digital
Commerce business and WGSN. The sale of these businesses
was approved by shareholders on 18 December 2023 and
completed in January 2024 and February 2024 respectively.
With regard to in-year business performance, our events continued
to outstrip their pre-Covid 2019 record levels of performance
generating strong organic growth both in revenue and EBITDA,
as well as reported operating profit.
Looking ahead to 2024, we continue to see positive customer
engagement, with booking levels for our events tracking in line
with prior year indicators overall. For more information on the
Company’s performance, priorities and outlook please see the
Chief Executive’s statement from page 6.
Leadership changes during 2023-24
The separation and sales of the Digital Commerce and WGSN
businesses required a reshaping of Ascential’s leadership team.
Philip Thomas was appointed as an Executive Director and Chief
Executive of Ascential on 2 January 2024 following the completion
of the sale of our Digital Commerce business. Details of his
remuneration are set out on page 106. Duncan Painter, the former
Chief Executive of Ascential, stepped down from the Board and left
the Company as part of the sale of the Digital Commerce business
to serve as Chief Executive Officer of Flywheel Digital, a new
practice area within Omnicom Group Inc.
In addition, independent Non-Executive Directors Joanne Harris and
Charles Song also stepped down from the Board on 2 January 2024.
As set out in last year’s Directors’ Remuneration Report, the
three-way separation of the Group’s businesses significantly
reduced the scope of the Chief Operating Officer role previously
held by Paul Harrison and so this role effectively became redundant
during the year as the individual businesses were restructured
internally in preparation for the sale process. As a result,
Paul Harrison left the business on 30 September 2023.
104
Ascential plc Annual Report 2023 Given the circumstances of the cessations of employment of
Duncan Painter and Paul Harrison, both were treated as good leavers
by the Remuneration Committee in relation to their participation in
the Company’s incentive plans. This meant both were eligible to
receive 2023 annual bonus awards (subject to performance and
prorated for Paul Harrison) and to retain their outstanding long-term
incentive awards (also subject to pro rata reductions to reflect their
periods of employment relative to their awards’ vesting periods with
performance to be tested at the end of the relevant performance
periods). Full details of the payments in connection with their
cessation of employment are set out on page 121.
Impact of Business Separation on Remuneration
The Committee’s approach when assessing the impact of
separation on remuneration was to ensure employees were treated
fairly and individual contribution was recognised as part of the
performance assessment process for employees leaving the Group
and those remaining in employment. With regards to Executive
Directors, in applying these principles, the Committee determined
that performance conditions would continue to apply until normal
vesting dates and that where adjustments were necessary
(i.e. as a result of the structure of the Group changing through the
performance periods), that conditions needed to be adjusted and/or
restated so that the revised performance conditions were no more
or less challenging than when they were originally set. Details of
how these principles were implemented are set out on page 121.
2023 Remuneration highlights
Directors Remuneration Policy
The Directors’ Remuneration Policy was approved at the 2023 AGM with
92% support. This Policy was a rollover of the previous policy in light of
the planned reshaping of the business over 2023. The Committee will
keep the operation of the Policy under review in 2024 to ensure it
remains fit for purpose for the Ascential Group going forward.
The 2023 Policy therefore provides the framework for how the
Committee implemented remuneration arrangements during 2023
and how Directors’ pay is intended to be structured in 2024.
Remuneration Outcomes
The 2023 bonus was based on Revenue growth and Adjusted
EBITDA targets. Given the strong performance in both Revenue
and Adjusted EBITDA, this resulted in bonus achievement of 174.6%
of target, or 87.3% of maximum, in respect of 2023 performance.
The Committee considers this outcome to be appropriate in the
context of the business performance and bonus outcome for the
wider employee population and no discretion was therefore applied
to the bonus outcome. These payments will be delivered half in
cash with half deferred into shares for three years.
With regards to our 2021 LTIP, vesting was assessed over a
three-year performance period to 31 December 2023 based on a
challenging EPS target accounting for 75% of the award, with the
remainder linked to Digital Commerce revenue. EPS performance
over the period did not reach the threshold performance target
and as a result 0% of this portion of the award vested. The vesting
outcome for the Digital Commerce revenue target was 53%,
resulting in an overall vesting for the 2021 PSP of 13%. Full details
of this performance assessment are set out on page 117.
As noted in previous reports, the 2020 PSP grant was delayed from
the normal grant time of March until October in response to the
uncertainty presented by Covid and the consequent challenges
with establishing appropriate performance conditions. Given the
challenges of setting financial targets at that time, the performance
condition was set based on Ascential’s total shareholder return
performance relative to the FTSE 250 Index (excluding investment
trusts). The performance period for that award was due to end on
30 September 2023. However, given Ascential was in an extended
close period than ran beyond 30 September 2023 that was caused
by the sale processes for the Digital Commerce and WGSN
businesses, the Committee concluded that it would not be
appropriate to test the performance condition at that time. This
was because the share price at that time did not reflect the terms
of the business separation and subsequent return of value to
shareholders which had yet to be announced to the market.
With the precise timing of the terms of the business separation
and return of value yet to be defined, the Committee concluded
that, subject to shareholder approval, the performance condition
should be extended to enable the testing of the performance
condition to take into account the shareholder value created
through the separation process which had been ongoing since
April 2022. The Committee determined that, in what were
considered exceptional circumstances, this approach would enable
the performance condition to fulfil its original intent in aligning the
recipients of the award with the shareholder experience through
the period once the market had full information in relation to the
business separation and subsequent return of value. As a result,
subject to shareholder approval at the 2024 AGM, the performance
period will be extended to the conclusion of the return of value to
shareholders and the value of any vesting set out in next year’s
Directors’ Remuneration Report.
Further details of the amendment to the 2020 PSP performance
period are set out in our 2024 Notice of AGM.
2023 Performance Share Plan Awards
In February 2023, the Committee granted Performance Share
awards consistent with our Remuneration Policy. The incumbent
CEO, Duncan Painter, and the CFO, Mandy Gradden, were granted
awards to the value of 200% of salary, with the performance
assessed based on Adjusted EPS growth and Digital Commerce
business unit Revenue targets. Whilst at the time of setting the
targets work was underway to achieve a successful separation of
the Company, the Committee resolved that it was appropriate to
set targets on a business-as-usual basis until such time as the terms
of any separation were finalised and then to adjust the targets as
necessary to ensure they remained similarly challenging and
appropriate once the separation was completed. With regard to the
degree of stretch in the targets, this was consistent with targets set
in prior years with reference to the combined Group’s internal
business plans and market expectations for the Company’s
performance over the performance period. The COO did not
receive an award given his announced departure during 2023.
The Committee granted a further award in December 2023 in
connection with Philip Thomas’ upcoming appointment as CEO. This
award also had terms consistent with the Company’s Remuneration
Policy with the award granted at a value of 200% of salary and it
included the same financial performance targets, subject to
105
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Report of the Remuneration Committee continued
adjustment as a result of the separation of the Company, for 80% of
the award as per the awards granted in February. For the balancing 20%
of the award, it also included strategic targets aligned with maximising
the benefits and value from the separation for the continuing Ascential
business. These targets included three key areas linked to the
long-term success of the newly separated business covering: (i)
diversification of growth; (ii) shareholder experience and value creation
; and (iii) strategic projects. With different incentives having operated in
different parts of Ascential in prior years, this was the first equity award
granted to Philip Thomas since 2021 and so in granting the award the
Committee ensured alignment of long-term objectives between the
current CEO and CFO. In light of the exceptional circumstances of the
separation, and to achieve full alignment between the CEO and CFO,
the Committee also approved the grant of an additional exceptional
2023 top-up award to the CFO with a value of 50% of salary so that she
would also be subject to the same strategic targets included in Philip
Thomas’ award. The overall impact of granting the top-up to the CFO
was to align both the CEO and CFO such that they both had awards
with common financial targets applying to 80% of their 2023 awards
with the balancing 20% of their awards applying to common strategic
goals to be delivered by the end of 2025. Full details of all awards
granted during the year are set out on page 118.
Remuneration within Ascential
Rita Clifton, Senior Independent Non-Executive Director, is the
Chair of The Ascential Forum which meets regularly and provides
employees with the opportunity to discuss business issues with an
Independent Non-Executive Director. The Forum is designed to cover
a broad range of topics, including our approach to governance and
remuneration. The feedback received by Rita Clifton is presented to
the Board and its committees for consideration.
With regard to the impact of the separation on employees, the same
principles detailed earlier applied to all employees. Given the nature
of Ascential’s businesses, and the geographies that the Company
has historically operated in, there were a number of tailored pay
structures in operation. In all cases, employees were treated fairly
in relation to the separation and both Company and individual
performance was taken into account when determining the
incentive awards due to those leaving and remaining with the Group.
metric used in 2023 as it is a broader measure of profitability and
a key performance metric for the Ascential business post separation.
In line with the Policy, 50% of any bonus earned will be the subject
of deferral into Ascential shares for a period of three years.
The 2024 Performance Share Plan will also operate on similar terms
to prior years, with awards of 200% of salary to be granted to the CEO
and CFO. The performance targets have been reviewed, and in line
with the key long-term financial priorities and reflecting a renewed
objective of aligning the full leadership team on the common
objectives of delivering profitable growth, will be based on challenging
Adjusted EPS, Adjusted Operating Profit and Revenue targets for the
continuing Ascential operations.
Committee composition, skills and experience
Gillian Kent and Rita Clifton remained in their positions as
Committee members throughout the year. The Committee has
solely comprised Independent Non-Executive Directors throughout
the year, in compliance with the UK Corporate Governance Code.
Role of the Committee
The Committee’s primary role is to determine the remuneration
of the Executive Directors and the Senior Leadership Team and to
determine the Remuneration Policy for the Executive Directors, as
well as monitoring its ongoing appropriateness and relevance. The
key responsibilities of the Committee are summarised on page 90
of the Corporate Governance Report and further details on the
Committee’s roles and responsibilities can be found in our Terms
of Reference on our website ascential.com.
The Committee met four times during 2023. All members of the
Committee attended all meetings and, by invitation, were joined by
the EVP, People and other members of the senior management
team where it was deemed appropriate. The Committee continued
to receive independent external advice from Korn Ferry.
I am satisfied that the Committee received information on a timely
basis and that the meetings were scheduled adequately to enable
members to have an informed discussion and debate.
Implementation of Remuneration Policy in 2024
Committee effectiveness
On appointment as Executive Director and Chief Executive on
2 January 2024, Philip Thomas had his salary set at £580,000.
The salary was set having had regard to market rates of pay in
other similar sized businesses and the salaries within the Senior
Leadership Team to ensure an appropriate relativity between roles.
Our usual practice is to review Executive Directors’ salaries with
effect from 1 April each year. With our UK salary budget set at 4%
of salary, the Committee awarded a salary increase of 3% of salary
to the CFO resulting in a salary of £450,043 effective 1 April 2024.
Given the timing of the CEO’s appointment, he will not be eligible
for a salary increase in April 2024.
The 2024 annual bonus will continue to operate on similar terms as
in prior years with a maximum opportunity of 125% of salary. The
bonus will be assessed against challenging Revenue and Operating
Profit targets. Operating Profit has replaced the Adjusted EBITDA
The Committee’s effectiveness was included in the annual review
of Board effectiveness which confirmed that the Committee has
operated effectively throughout 2023.
Conclusion
2023 has been a transformational year for the Group and this report
provides the context for the decisions we have taken during the
year. I hope you understand the rationale for our approach and look
forward to receiving your support at our 2024 AGM, where I will be
available to respond to any questions shareholders may have on
this report in relation to any of the Committee’s activities.
Judy Vezmar
Chair of the Remuneration Committee
25 March 2024
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Ascential plc Annual Report 2023
Directors’
remuneration policy
Approved by shareholders at the 2023 AGM with 92% support.
This part of the Remuneration Report sets out Ascential’s
Remuneration Policy for its Executive and Non-Executive Directors.
The policy was developed considering the principles of the 2018 UK
Corporate Governance Code and guidelines from major investors.
What is the role of the Remuneration Committee?
• promote the long-term success of the business;
• provide an appropriate balance between fixed and
performance-related, and immediate and deferred remuneration
to support a high-performance culture;
• adhere to the principles of good corporate governance
and best practice;
The Remuneration Committee (“the Committee”) has responsibility
for determining the overall pay policy for Ascential. In particular, the
Committee is responsible for:
• align executives with the interests of shareholders and
other external stakeholders; and
• consider the wider pay environment, both internally
• determining the framework or broad policy for the fair
and externally.
remuneration of Ascential’s Executive Directors, and certain
other senior management including the direct reports of the
Chief Executive Officer;
• approving their remuneration packages and service
contracts, giving due regard to the UK Corporate Governance
Code as well as the Financial Conduct Authority’s rules and
associated guidance;
• ensuring that the Remuneration Policy is adequate and
appropriate to attract, motivate and retain personnel of high
calibre and provides, in a fair and responsible manner, reward
for their individual contributions;
• reviewing the ongoing appropriateness and relevance of the
Remuneration Policy, overseeing any major changes in remuneration
and employee benefits structures throughout Ascential;
• consulting with shareholders and their advisory bodies in
advance of significant changes to Remuneration Policy;
• approving the design of, and determining targets for,
performance-related pay schemes operated by Ascential
and approving the total annual payments made under such
schemes; and
• reviewing the design of all share incentive plans for approval by
the Board and shareholders. For any such plans, the Committee
determines each year whether awards will be made and, if so,
the overall amount of such awards, the individual awards to
Executive Directors and other senior management, and the
performance targets to be used.
Policy Overview
When setting the policy for Directors’ remuneration, the
Committee takes into account the overall business strategy and risk
tolerance, considering the long-term interest of the Company with
a view to adequately attracting, retaining and rewarding skilled
individuals and delivering rewards to shareholders. Consistent with
these principles, the Committee has agreed a Remuneration Policy
which will:
• provide a simple remuneration structure which is easily
understood by all stakeholders;
• attract, retain and motivate executives and senior
management in order to deliver the Company’s strategic
goals and business outputs;
Furthermore, the Committee is satisfied that the Remuneration
Policy and its application takes due account of the six factors listed
in the UK Corporate Governance Code:
Clarity – our policy is well understood by our management team
and has been clearly articulated to our shareholders.
A key part of our Chief People Officer’s role is engaging with our
wider employee base on all our “People Matters” (including
remuneration) and we monitor the effectiveness of this process
through the feedback received.
Simplicity – the Committee is very mindful of the need to
avoid overly complex remuneration structures which can be
misunderstood and/or deliver unintended outcomes. Therefore,
one of the Committee’s objectives is to ensure that our executive
remuneration policies and practices are as simple to communicate
and operate as possible, while also supporting our strategy.
Risk – our Remuneration Policy is designed to ensure that
inappropriate risk-taking is not encouraged and will not be
rewarded via (i) the balanced use of both short- and long-term
incentive plans and (ii) malus/clawback provisions.
Predictability – our incentive plans are subject to individual caps,
with our share plans also subject to market standard dilution limits.
The scenario charts on page 112 illustrate how the rewards
potentially receivable by our Executive Directors vary based
on performance delivered and share price growth.
Proportionality – there is a clear link between individual awards,
delivery of strategy and our long-term performance. In addition,
the significant role played by the value of reward through equity
with post-employment holding requirements, together with the
structure of the Executive Directors’ service contracts, ensures that
poor performance is not rewarded.
Alignment to culture – Ascential has a relentless focus on delivering
for our customers and this is fully aligned with our Remuneration
Policy in that employee personal success is directly linked to our
values through the short-term incentive plans and targets we
operate. This is especially the case at the most senior levels within
our business.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Directors’ remuneration policy continued
How are wider employment conditions considered?
The Committee seeks to ensure that the underlying principles
which form the basis for decisions on Executive Directors’ pay are
consistent with those on which pay decisions for the rest of the
workforce are taken. For example, the Committee takes into account
the general salary increase for the broader employee population
when conducting the salary review for the Executive Directors.
With effect from 1 April 2023, the salary increases awarded to the
Executive Directors were at 3.5% of salary which was at a discount to
the UK salary budget of 4.5%. The lower rate of executive increase
enabled higher increases to be awarded to the wider workforce at
a time of historically high rates of general inflation.
The Company operates UK and International Sharesave and US
Stock Purchase saving plans for employees wishing to invest in the
Company’s shares. A formal employee consultation on remuneration
is not operated; however, employees are able to provide feedback
on the Company’s remuneration policies to their managers or the
People Team informally, as well as through the employee
engagement survey and formal performance review process.
The Ascential Employee Forum was established in 2020 and
continued to provide an additional channel for consulting with
employees on issues affecting them, including Remuneration
Policy. Fixed ratios between the total remuneration levels of
different roles in Ascential are not applied, as this may prevent us
from recruiting and retaining the necessary talent in competitive
employment markets. We do operate a formal job banding
framework, which helps to ensure that remuneration is appropriate
and consistent across the organisation.
What are the elements of Executive Directors’ Pay?
The Executive Directors’ Remuneration Policy (as set out on pages
107 to 114) reflects differences compared to the broader employee
base that are appropriate to leadership to ensure alignment with
shareholder interests. A greater weight is placed on performance-
based pay through the quantum and participation levels in
incentive schemes. Different incentive structures operate below
Board that are tailored in recognition of market practice in each
business and its geographical footprint.
What changes are we making to the Directors’
Remuneration Policy?
The Committee reviewed the Policy and its operation in the
context of the separation of the Digital Commerce and WGSN
businesses and concluded that it remained appropriate for 2024.
As a result, no changes are being made to the current policy.
Are the views of shareholders considered?
The Committee values and is committed to dialogue with
shareholders. We will continue to carefully consider any
shareholder feedback received in relation to the AGM this year
and in future. As with the Directors’ Remuneration Policy proposed
for approval at the 2023 AGM, the Committee will continue to
engage proactively with shareholders and ensure that shareholders
are consulted in advance where any material changes to the
Directors’ Remuneration Policy are proposed.
Element
Purpose and link to strategy
Operation
Opportunity
Base Salary
Provides a competitive and
appropriate level of basic
fixed pay appropriate to
recruit, retain and reward
Directors of a suitable calibre
to deliver the Company’s
strategic goals and business
outputs.
Reflects an individual’s
experience, performance and
responsibilities within
Ascential.
Set at a level which provides a fair reward for the role
and which is competitive amongst relevant peers.
Normally reviewed annually with any changes taking
effect from 1 April each year.
Set taking into consideration individual and Company
performance, the responsibilities and accountabilities
of each role, the experience of each individual, his or
her marketability and Ascential’s key dependencies on
the individual.
Reference is also made to salary levels amongst relevant
peers and other companies of equivalent size and
complexity.
The Committee considers the impact of any base
salary increase on the total remuneration package.
Increases will normally be in line with
the general increase for the broader
employee population, considering
factors such as performance of the
Company and external factors such
as inflation. More significant
increases than standard may be
awarded from time to time to
recognise, for example, development
in role and change in position or
responsibility, as are also considered
for the wider workforce for the
same reasons.
Current salary levels are disclosed in
the Annual Report on Remuneration.
Benefits
Provides market competitive
and appropriate benefits
package.
Benefits provided may include private medical insurance,
life assurance and income protection insurance.
The benefits provided may be subject to minor
amendment from time to time by the Committee within
this policy. In addition, Executive Directors are eligible
for other benefits which are introduced for the wider
workforce on broadly similar terms. The Company may
reimburse any reasonable business-related expenses
incurred in connection with their role (including tax
thereon if these are determined to be taxable benefits).
There is no overall maximum level
of benefits provided to Executive
Directors, and the level of some of
these benefits is not pre-determined
but may vary from year to year
based on the overall cost to the
Company. However, the Committee
monitors annually the overall cost of
the benefits provided to ensure that
it remains appropriate.
108
Ascential plc Annual Report 2023 Element
Pension
Purpose and link to strategy
Operation
Opportunity
Provides a competitive and
appropriate pension package.
Each Executive Director has the right to participate in
the pension scheme operated by the Company either
via a contribution into the Company’s defined
contribution plan, or via an alternative cash allowance.
Pension contributions and/or cash
allowances are set at 9% of base
salary for Executive Directors
appointed prior to 2020 taking into
account their service in post and the
approach to pensions applied to the
wider UK workforce.
For Executive Directors who joined
after the 2020 policy was approved,
the Company contribution will align
with the pension provision to the
wider UK workforce with executives
eligible to receive a maximum
Company contribution to a pension
scheme or a cash payment on the
following scale:
5% of salary: less than
5 years’ service;
7% of salary: less than
10 years’ service; and
9% of salary: greater than
10 years’ service.
All-employee
share plans
Encourages employee share
ownership and therefore
increases alignment with
shareholders.
Ascential may from time to time operate tax-approved
share plans (such as HMRC approved Save As You Earn
Option Plan and Share Incentive Plan) for which
Executive Directors could be eligible.
The schemes are subject to the
limits set by HMRC or appropriate
tax authority from time to time.
Annual bonus
Incentivises the execution of
key annual goals by rewarding
performance against targets
aligned to delivery of strategy.
Compulsory deferral of a
portion of bonus into
Ascential shares provides
alignment with shareholders.
The maximum bonus payable to
Executive Directors is 125% of base
salary with 50% of maximum payable
for on-target performance (62.5% of
salary). 0% of salary is paid for
threshold performance.
Dividends may accrue on DABP
awards over the vesting period and
be paid out either as cash or as
shares on vesting.
Paid annually, bonuses will be subject to
achievement of stretching financial performance
measures. The Committee also has discretion to
introduce non-financial and/or strategic measures
in future years. It is intended, however, that financial
measures will determine the majority of the annual
bonus opportunity.
50% of the bonus will normally be deferred into awards
over shares under the Deferred Annual Bonus Plan
(“DABP”), with awards normally vesting after a
three-year period.
Executive Directors have the flexibility to voluntarily
elect to defer up to 100% of any bonus earned into
shares for three years.
Recovery and withholding provisions are in operation
across the annual bonus and the DABP in certain
circumstances, including where there has been a
misstatement of accounts, an error in assessing any
applicable performance conditions, or in the event of
misconduct on the part of the participant.
The Committee has discretion to adjust bonus outcomes
having had regard to overall corporate performance.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Directors’ remuneration policy continued
Element
Purpose and link to strategy
Operation
Opportunity
Performance
Share Plan
(“PSP”)
Rewards the achievement of
sustained long-term
performance that is aligned
with shareholder interest.
Facilitates share ownership to
provide further alignment
with shareholders.
Annual awards of performance shares that normally vest
after three years subject to performance conditions
and continued service. Performance is normally tested
over a period of at least three financial years.
The normal maximum opportunity
is 200% of base salary. In exceptional
circumstances this may be
increased to 250% of salary.
For the awards to be granted in 2024, awards will be
subject to targets based on growth in Adjusted EPS,
Operating Profit and Revenue.
Different performance measures and/or weightings
may be applied for future awards as appropriate.
At least 50% of future awards will be subject to financial
measures which will normally be a profit measure.
The Committee will consult in advance with major
shareholders prior to any significant changes
being made.
Following vesting, a further two-year holding period will
apply to the awards whereby Executive Directors will be
restricted from selling the net-of-tax shares which vest.
Recovery and withholding provisions operate in certain
circumstances, including where there has been a
misstatement of accounts, an error in assessing any
applicable performance conditions, or in the event of
misconduct on the part of the participant. These
provisions apply for at least three years from the date
on which an award vests.
Subject to the Remuneration
Committee’s discretion to amend
formulaic outputs, for achievement
of the threshold level of
performance (the minimum level of
performance for vesting to occur),
up to 25% of the maximum
opportunity will vest for each
element, rising on a graduated scale
up to 100% of each element vesting
for achieving the maximum level of
performance.
Dividends may accrue on PSP
awards over the vesting period
and be paid out either as cash
or as shares on vesting in respect
of the number of shares that
have vested.
Shareholding
guideline
Encourages Executive
Directors to build a
meaningful shareholding in
Ascential so as to further align
interests with shareholders.
Each Executive Director must build up and maintain a
shareholding in Ascential equivalent to 200% of base
salary. If an Executive Director does not meet the
guideline, they will be expected to retain at least half
of the net shares vesting under the Company’s
discretionary share-based employee incentive
schemes until the guideline is met.
Not applicable
Post-
employment
share ownership
requirements
Ensures there is an
appropriate amount of ‘tail
risk’ for executives post
cessation of employment.
Executives leaving employment as good leavers (e.g.
due to retirement) will continue to hold share awards
until the later of their original vesting date or the
conclusion of a holding period on the vested shares.
Not applicable
Deferred share bonus awards and PSP awards will only
be eligible to vest at the normal vesting date (i.e. three
years from grant and subject to performance in the
case of the PSP) and vested PSP shares subject to a
holding period will remain subject to the holding period
(i.e. vesting and release will not be brought forward
from year 5 to year 3). An exceptional circumstances
provision will apply so that these provisions could be
overridden (e.g. in the event of death).
Bad leavers’ share awards will lapse
on cessation of employment.
110
Ascential plc Annual Report 2023 The performance conditions for the PSP will be weighted towards
financial performance and include metrics weighted towards
long-term value creation (e.g. a combination of Adjusted EPS and
revenue performance). Revenue growth is as an appropriate metric
as it is a key long-term strategic priority.
A sliding scale of challenging performance targets is set for both
of these measures and further details of the targets applied are
set out in the Annual Report on Remuneration.
The Committee will review the choice of performance measures
and the appropriateness of the performance targets prior to each
PSP grant.
Different performance measures and/or weightings may be applied
for future awards as appropriate. However, the Committee will
consult in advance with major shareholders prior to any significant
changes being made.
What about pre-existing arrangements?
In approving this Directors’ Remuneration Policy, authority is given to
the Remuneration Committee to honour any commitments entered
into with current Directors that pre-date the approval of the policy.
Details of any payments to current or former Directors will be set out
in the Annual Report on Remuneration if and when they arise.
How does the executive pay policy differ from that
for other Ascential employees?
The Remuneration Committee considers the Executive Directors’
remuneration in the context of the wider employee population. All
of the Company’s employees have the opportunity to participate in
share-based rewards such as SAYE, and the wider leadership team
of the Company participate in annual bonus arrangements. The
Remuneration Policy for the Executive Directors is more heavily
weighted towards variable pay than for other employees, to make
a greater part of their pay conditional on the successful delivery of
business strategy. This aims to create a clear link between the value
created for shareholders and the remuneration received by the
Executive Directors. Different incentive structures operate below
the Board that are tailored in recognition of market practice in each
business and its geographical footprint.
What discretion does the Committee retain in
operating the incentive plans?
The Committee operates Ascential’s various incentive plans
according to their respective rules. To ensure the efficient
operation and administration of these plans, the Committee retains
discretion in relation to a number of areas. Consistent with market
practice, these include (but are not limited to) the following:
• Selecting the participants;
• The timing of grant and/or payments;
• The size of grants and/or payments (within the limits set out
in the policy table above);
• The extent of vesting based on the assessment of performance;
• Determination of good leaver and, where relevant, the extent
of vesting in the case of the share-based plans;
• Treatment in exceptional circumstances such as change of
control, in which the Committee would act in the best interests
of Ascential and its shareholders;
• Making the appropriate adjustments required in certain
circumstances (e.g. rights issues, corporate restructuring
events, variation of capital and special dividend);
• Cash settling awards; and
• The annual review of performance measures, weightings
and setting targets for the discretionary incentive plans
from year to year.
Any performance conditions may be amended or substituted
if one or more events occur which cause the Committee to
reasonably consider that the performance condition would
not without alteration achieve its original purpose. Any varied
performance condition would not be materially less difficult
to satisfy in the circumstances.
How does the Committee choose performance
measures and set targets?
The performance metrics used for the annual bonus plan and PSP have
been selected to reflect Ascential’s key performance indicators.
The annual bonus is based on performance against a stretching
combination of financial measures, with the flexibility to include
non-financial performance measures if considered to be
appropriate. The financial measures are set taking account of
Ascential’s key operational objectives but will typically include a
measure of profitability such as Operating Profit (which is also
closely correlated with the generation of cash) and/or revenue
(which reflects the Company’s growth focus) as these are key
performance indicators. In 2024, the annual bonus will be
measured on revenue (50%) and profit (50%) targets.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Directors’ remuneration policy continued
How much could an Executive Director earn under
the Remuneration Policy?
A significant proportion of total remuneration is linked to Company
performance, particularly at maximum performance levels.
The chart below illustrates how the Executive Directors’ potential
reward opportunity varies under three different performance
scenarios: fixed pay only, on-target and at maximum. Illustrations
are intended to provide further information to shareholders
regarding the pay for performance relationship. Actual pay
delivered will be influenced by changes in share price and the
vesting levels of awards.
Philip Thomas
CEO £’000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
£1,642
39%
22%
39%
£641
100%
£2,526
46%
29%
25%
Below target
Target
Maximum
Mandy Gradden
CFO £’000
3,500
3,000
2,500
2,000
1,500
1,000
500
0
£1,272
39%
22%
39%
£496
100%
£1,958
46%
29%
25%
Below target
Target
Maximum
£3,106
19%
37%
23%
20%
Maximum
(with share
price growth)
£2,408
19%
37%
23%
21%
Maximum
(with share
price growth)
Fixed Pay
Annual Bonus
LTIP
50% share price growth on LTIP
The Executive Directors can participate in all-employee share
schemes on the same basis as other employees. The value that may
be received under these schemes is subject to tax-approved limits.
For simplicity, the value that may be received from participating in
these schemes has been excluded from the above charts.
What would a new Executive Director be paid?
The ongoing remuneration package for a new Executive Director
would be set in accordance with the terms of Ascential’s
shareholder-approved Remuneration Policy at the time of
appointment and the maximum limits set out therein. It is the
Remuneration Committee’s policy that no ongoing special
arrangements will be made, and in the event that any deviation
from standard policy is required to recruit a new hire on an ongoing
basis, approval would be sought at the Annual General Meeting.
Base salary levels will be set in accordance with Ascential’s
Remuneration Policy, taking into account the experience and
calibre of the individual. Salaries may be set at a below-market level
initially with a view to increasing them to the market rate subject to
individual performance and developing into the role by making
phased above-inflation increases.
Benefits will be provided in line with those offered to the other
Executive Directors, taking account of local market practice.
What would the ongoing incentive arrangements be
for a newly appointed Executive Director?
Currently, for an Executive Director, annual bonus payments will
not exceed 125% of base salary and PSP awards would not normally
exceed 200% of base salary (not including any arrangements to
replace forfeited entitlements).
Where necessary, specific annual bonus and PSP targets and
different vesting and/or holding periods may be used for an
individual for the first year of appointment if it is appropriate to
do so to reflect the individual’s responsibilities and the point in
the year in which they joined the Board. A PSP award can be made
shortly following an appointment (assuming the Company is not
in a close period).
What payments could a newly appointed Executive
Director receive beyond the policy?
The Committee retains flexibility to offer additional cash
and/or share-based awards on appointment to take account of
remuneration or benefit arrangements forfeited by an Executive
on leaving their previous employer. If shares are used, such awards
may be made under the terms of the PSP or as permitted under
the Listing Rules.
Such payments would take into account the nature of awards
forfeited and would reflect (as far as possible) performance
conditions, the values foregone and the time over which they
would have vested or been paid. Awards may be made in cash if
the Company is in a prohibited period at the time an Executive joins
the Company.
The Committee may also agree that the Company will meet certain
relocation, legal, tax equalisation and any other incidental expenses
as appropriate so as to enable the recruitment of the best people
including those who would need to relocate.
112
Ascential plc Annual Report 2023 What about an internal appointment?
In the case of an internal Executive Director appointment, any
variable pay element awarded in respect of the prior role may be
allowed to pay out according to its terms, and adjusted as relevant
to take into account the appointment. In addition, any other
ongoing remuneration obligations existing prior to appointment
may continue. Where a temporary internal promotion occurs,
base salary may be subject to an adjustment to better reflect the
temporary role or an additional allowance may be payable to reflect
the additional responsibilities for the period they operate.
Are the Executive Directors allowed to hold external
appointments?
Executive Directors are permitted to accept external appointments
with the prior approval of the Board and where there is no impact
on their role with Ascential. The Board will determine on a
case-by-case basis whether the Executive Directors will be
permitted to retain any fees arising from such appointments.
What are the Executive Directors’ terms of
employment? What are their notice periods?
The Executive Directors have entered into service agreements
with an indefinite term that may be terminated by either party
on 12 months’ written notice. Contracts for new appointments
will be terminable by either party on a maximum of 12 months’
written notice.
What payments will an Executive Director receive
when they leave the Company?
An Executive Director’s service contract may be terminated
summarily without notice and without any further payment
or compensation, except for sums accrued up to the date of
termination, if they are deemed to be guilty of gross misconduct
or for any other material breach of the obligations under their
service agreements.
The Company may suspend the Executive Directors or put them
on a period of garden leave during which they will be entitled to
salary, benefits and pension only.
If the employment of an Executive Director is terminated in other
circumstances, compensation may include base salary due for any
unexpired notice period, pro rata bonus (normally based on
performance assessed after the year end), and any amount
assessed by the Committee as representing the value of other
contractual benefits which would have been received during the
period. The Company may choose to continue providing some
benefits instead of paying a cash sum, representing their cost.
The cash element of any annual bonus paid to a departing
Executive Director would normally be paid at the normal payment
date, and reduced pro rata to reflect the actual period worked.
Any statutory entitlements or sums to settle or compromise claims
in connection with a termination (including, at the discretion of the
Committee, reimbursement for tax or legal advice and provision of
outplacement services) would be paid as necessary.
Executive Directors’ service contracts are available for inspection
at Ascential’s registered office during normal business hours and
will be available for inspection at the AGM.
How are outstanding share awards treated when
an Executive Director leaves Ascential?
Any share-based entitlements granted to an Executive Director
under Ascential’s share plans will be treated in accordance with
the relevant plan rules. Usually, any outstanding awards lapse
on cessation of employment. However, in certain prescribed
circumstances, such as death, injury, disability, retirement with the
consent of the Committee, the sale of the entity that employs him/her
out of Ascential or any other circumstances at the discretion of the
Committee, “good leaver” status may be applied.
For good leavers under the PSP, outstanding awards will normally
vest at the original vesting date to the extent that the performance
condition has been satisfied, and would normally be reduced on a
pro-rata basis to reflect the period of time which has elapsed
between the grant date and the date on which the participant
ceases to be employed by the Company. The Committee retains
the discretion to vest awards (and measure performance
accordingly) on cessation and/or to disapply time prorating.
However, it is envisaged that this would only be applied in
exceptional circumstances in line with the Company “post
cessation of employment share ownership guideline”. For good
leavers under the DABP, unvested awards will vest at the original
vesting date unless the Committee exercises its discretion and
allows the award to vest in full on, or shortly following, the date of
cessation. However, in line with the Company “post cessation of
employment share ownership guideline” it is envisaged this would
only be applied in exceptional circumstances.
In determining whether a departing Executive Director should be
treated as a “good leaver”, the Committee will take into account the
performance of the individual and the reasons for their departure.
What happens to their outstanding share awards
if there is a takeover or other corporate event?
Outstanding awards on a takeover or winding up of the Company
will vest early to the extent that the performance condition has
been satisfied, and would normally be reduced on a pro rata basis
to reflect the period of time which has elapsed between the grant
date and the date of the takeover or other corporate event,
although the Committee would retain discretion to waive time
pro-rating of an award if it regards it as appropriate to do so in the
particular circumstances.
In the event of a demerger, special dividend or other event which,
in the opinion of the Committee, may affect the current or future
value of shares, the Committee may decide that awards will vest on
a basis which would apply in the case of takeover. In the event of
an internal corporate reorganisation, awards will be replaced by
equivalent new awards over shares in a new holding company,
unless the Committee decides that awards should vest on a basis
which would apply in the case of a takeover.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Directors’ remuneration policy continued
How are the Non-Executive Directors paid?
Element
Purpose and link to strategy Operation
Non-Executive
Director
fees
To attract and retain a
high-calibre Chair and
Non-Executive
Directors by offering
market competitive
fee levels.
The Company Chair is paid an annual fee. The Non-
Executives (including the Senior Independent Director)
are paid a basic fee, with the Chairs of the main Board
Committees, the Senior Independent Director and the
Non-Executive Director designated as the employee
representative, being paid additional fees to reflect the extra
responsibilities and time commitments. If there is a temporary
yet material increase in the time commitments for Non-Executive
Directors, the Board may pay extra fees on a pro rata basis to
recognise the additional workload.
The level of fees is reviewed periodically by the Committee
and CEO for the Company Chair, and by the Company Chair
and Executive Directors for the Non-Executive Directors, and
is set taking into consideration market levels in comparably
sized FTSE companies, the time commitment and responsibilities
of the role and to reflect the experience and expertise required.
The Company Chair and the Non-Executive Directors are not
eligible to participate in incentive arrangements or to receive
benefits save that they are entitled to reimbursement of
reasonable business expenses and any tax thereon.
Opportunity
The fees are subject to
maximum aggregate limits as set
out in the Company’s Articles
of Association (£2,000,000).
The Committee is guided by
the general increase for the
broader employee population,
but on occasions may need to
recognise, for example,
changes in responsibility, and/
or time commitments.
Current fee levels are disclosed
in the Annual Report on
Remuneration.
What would a new Chair or Non-Executive Director be paid?
For a new Chair or Non-Executive Director, the fee arrangement would be set in accordance with the approved Remuneration Policy
in force at that time.
What are the terms of appointment for the Chair and Non-Executive Directors?
All Non-Executive Directors have letters of appointment with the Company for an initial period of three years (save for the Chair
who is appointed for a nine-year term), subject to annual re-election by the Company at a general meeting.
The appointment of each Chair and Non-Executive Director may be terminated by either party with three months’ notice.
The appointment of each may also be terminated at any time if they are removed as a Director by resolution at a general meeting
or pursuant to the Articles, provided that in such circumstances the Company will (except where the removal is by reason of their
misconduct) pay the Chair or Non-Executive an amount in lieu of their fees for the unexpired portion of his or their notice period.
Directors’ letters of appointment are available for inspection at the registered office of Ascential during normal business hours and
will be available for inspection at the AGM.
Dates of Directors’ service contracts/letters of appointment
Date of service
contract/appointment
Unexpired term of contract
Executive Directors
Duncan Painter1
Mandy Gradden
Paul Harrison2
Philip Thomas
Non-Executive Directors
Scott Forbes
Suzanne Baxter
Rita Clifton
Joanne Harris1
Gillian Kent
Charles Song1
Judy Vezmar
1 Stepped down from the Board on 2 January 2024
2 Stepped down from the Board on 30 September 2023
4 January 2016
4 January 2016
11 January 2021
2 January 2024
11 January 2016
5 January 2021
12 May 2016
1 April 2021
21 January 2016
1 October 2020
21 January 2016
Rolling contract
Rolling contract
Rolling contract
Rolling contract
n/a
n/a
n/a
n/a
n/a
n/a
n/a
114
Ascential plc Annual Report 2023 Annual report on
remuneration
Subject to an advisory vote at the 2024 AGM.
This report has been prepared in accordance with the provisions
of the Companies Act 2006 and the Large and Medium-sized
Companies and Groups (Accounts and Reports) Regulations 2008
(as amended). This report has also been prepared in line with the
recommendations of the 2018 UK Corporate Governance Code.
This part of the Directors’ Remuneration Report sets out a summary
of how the Directors’ Remuneration Policy was applied during 2023.
The policy in place for the year was approved by shareholders at
the 2023 AGM. This Annual Report on Remuneration will be subject
to an advisory vote at the 2024 AGM. Various disclosures in this
report about the Directors’ remuneration have been audited by
Ascential’s independent auditor, KPMG LLP. Where information has
been audited, this has been clearly indicated.
What is the composition of the Remuneration
Committee?
The Committee is made up of independent Non-Executive
Directors and there is cross-membership with the Audit
Committee, whose remit includes review of risk management,
to ensure that there is alignment between the Group’s key risks
and its Remuneration Policy. Regular attendees include the external
remuneration adviser, Chief Executive, EVP, People and the VP,
Reward. No attendee is present when their own individual
remuneration is being discussed.
Committee attendance during the year
The Committee held four formal meetings during the year, and
additionally met informally several times to discuss any matters
arising. All members attended all meetings.
Key activities of the Committee
The Committee’s key activities during the 2023 financial year were:
• discussion and approval of the approach to executive and senior
management remuneration for 2023 in light of the planned
separation of the Digital Commerce and WGSN businesses;
• reviewing base salaries for Executive Directors and senior
management;
• approving the 2022 bonus outcome for Executive Directors and
senior management;
• setting 2023 bonus targets for Executive Directors and
approving them for senior management;
• approving awards under the Company’s share plans, including
associated performance conditions;
• approving the 2022 Remuneration Committee Report;
• setting the appointment terms of Philip Thomas, appointed
Executive Director and Chief Executive on 2 January 2024; and
• approving the treatment of the former CEO’s remuneration in
connection with his departure to lead the Flywheel Digital
business which was sold to Omnicom Group Inc in January
2024, and the treatment of the COO’s remuneration following
his departure in September 2023.
115
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Annual report on remuneration continued
Total remuneration for the financial year to 31 December 2023 (Audited)
The following table reports the total remuneration receivable in respect of qualifying services by each Director for the year ended
31 December 2023.
£’000
Executive
Duncan Painter
Mandy Gradden
Paul Harrison5
Non-Executive
Scott Forbes (Chair)
Suzanne Baxter
Rita Clifton
Joanne Harris6
Funke Ighodaro7
Gillian Kent
Charles Song6
Judy Vezmar
Total
Total
Salary &
fees
Taxable
benefits1
Pension2
Total
Fixed Pay
Annual
Bonus3
Long-Term
Incentive4,8
Total
Variable Pay
Total
Remuneration
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
2023
2022
585
566
433
420
361
459
231
220
77
65
67
65
63
63
–
41
57
55
61
59
75
65
2,010
2,078
13
9
5
5
5
6
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
23
20
53
51
39
38
17
23
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
109
112
651
626
477
463
383
488
231
220
77
65
67
65
63
63
–
41
57
55
61
59
75
65
2,142
2,210
637
322
473
239
377
261
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,487
822
70
–
67
–
44
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
181
–
707
322
540
239
421
261
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
1,668
822
1,358
948
1,017
702
804
749
231
220
77
65
67
65
63
63
–
41
57
55
61
59
75
65
3,810
3,032
1
2
3
4
Benefits include private medical insurance, life assurance, income protection insurance and, in the case of the Chief Executive, use of a company driver.
Pension amounts are the cash allowance paid in lieu of pension contributions which are calculated as 9% of salary for the CEO and CFO, and 5% for the COO.
Bonus was calculated as a percentage of annual salary received during the year – i.e. prorated for salary increase in April each year. Any bonus amounts to be deferred under the
Deferred Annual Bonus Plan are shown in the bonus figure for the year in which they were awarded.
The PSP award granted in September 2021 has a performance period ended 31 December 2023 and will vest in September 2024 at a level of 13%. As vesting is post the year end, an
average share price for Q4 2023 has been used to calculate the long-term incentive value in the above table. See page 117 for details of the performance conditions.
5 Paul Harrison ceased to be a director of Ascential plc with effect from 30 September 2023.
6
7
8
Charles Song and Joanne Harris’ fees are paid in local currency (Hong Kong dollar and US dollar respectively). Their fees were fixed in local currency on their appointment and therefore
the GBP amount of their fees varies according to movement in the GBP exchange rate.
Funke Ighodaro resigned from the Board with effect from 9 September 2022.
The 2020 LTIP has a vesting date that is the later of 1 October 2023 and the date of testing the performance conditions. As set out in the Remuneration Committee Chair’s Annual
Statement, subject to shareholder approval, the performance period is to be extended and as a result any value attributable to the 2020 LTIP will be included in next year’s Annual Report
on Remuneration.
The aggregate gain for Duncan Painter in the year from the exercise of options under the DABP was £113,906 based on the market price on
the date of exercise of £2.68. There were no gains made in 2023 by Mandy Gradden or Paul Harrison.
Duncan Painter was also a Non-Executive Director of ITV plc until 30 November 2023 and received fees totalling £66,941 in 2023 (2022:
£70,425) from that external appointment. Paul Harrison was a Non-Executive Director of Darktrace plc and received fees totalling £71,316 in
2023 (2022: USD 114,992) from that external appointment. Mandy Gradden was appointed as a Non-Executive Director of Spectris plc in
October 2023 and received fees totalling £13,408 from that external appointment (2022: £nil).
116
Ascential plc Annual Report 2023 How was the annual bonus payment determined? (Audited)
The bonus targets for the year, performance against these targets, and the resulting payouts are set out below. At the time of setting
the targets, the Committee considered the target ranges to provide an appropriate balance between being achievable at the bottom end
of the performance ranges and providing a stretch target at the top end of the ranges. The targets were considered similarly demanding
to those set for 2022 allowing for changes to the Company’s portfolio of businesses. The targets were subject to an appropriate
adjustment to reflect material M&A activity during the year with this approach ensuring that the targets were no less challenging
than when originally set.
Weighting
Threshold
Target
Maximum
Actual
Target
Revenue (£’m)
EBITDA (£’m)
Total
%
50
50
100
Required
result
Payout as %
of maximum
Required
result
Payout as a %
of maximum
Required
result
Payout as a %
of maximum
Actual
result
Payout as a %
of maximum
Payout as
% of target
521.4
109.7
0
0
579.3
121.9
50
50
585.1
124.9
100
100
584.8
123.5
97.4
77.2
87.3
194.7
154.4
174.6
The Committee confirmed that this payout level was appropriate in the overall context of the Company’s financial performance in 2023. In
approving bonus awards the Committee noted that the Company delivered strong performance during the year, and realised the strategic
plan to separate the Digital Commerce and WGSN businesses. No discretion to adjust payouts was therefore required. Half of the bonus
will be deferred into shares for three years under the Deferred Annual Bonus Plan.
What equity awards have been included in the single figure table? (Audited)
The Executive Directors received an award in 2021 under the Performance Share Plan (“PSP”) which vests to the extent performance
conditions are met over the period to 31 December 2023, with targets based on EPS and Digital Commerce Business Unit performance.
Details of the performance assessment and the vesting are summarised below.
Performance metric
Adjusted EPS (FY23)
Digital Commerce Business Unit Revenue
Total
Weighting
Threshold
performance
Threshold
vesting
Maximum
performance
Actual
performance
Proportion of
award to vest
75%
25%
14.3p
£246m
25%
25%
18.9p
£307m
10.2p
270.0m
0%
53%
13%
With regards to the EPS performance target, the Committee considered whether any adjustments were necessary to ensure that material
events during the measurement period had not made the performance conditions materially more or less difficult to satisfy. Consistent
with historic methodology, the Committee considered the impact on the performance condition, and subsequent vesting, if it increased
the targets for material M&A through the period and reduced the targets for divested bushiness through the period. Making these
adjustments would ensure that the targets were no more or less challenging than when they were originally set. However, having
considered the impact, the vesting result was the same as on the basis of the original targets set out above and there was no vesting for
this part of the award.
With regards to the Digital Commerce Business Revenue target, consistent with the principles detailed above for EPS, and the intent when
the target was set, the targets were increased to take account of the acquisitions of OneSpace, Sellics, WhyteSpyder, Intrepid and 4K
Miles. This resulted in the targets being increased with reference to the acquisition cases so that the threshold target was increased from
£179m to £246m and the maximum target from to £224m to £307m. The Committee was comfortable that these adjustments resulted in
the target being similarly challenging to the original target allowing for the acquisitions made through the period and were comfortable
that the vesting outcome was a fair reflection of the performance delivered.
117
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Annual report on remuneration continued
Based on this performance assessment, the table below illustrates the value receivable under the 2021 Awards. Any shares vesting will be
subject to a two-year holding period.
Award holder
Duncan Painter
Mandy Gradden
Paul Harrison
Number of
awards granted
Number of
shares to lapse
due to proration
Payout
(% of maximum)
Number of
shares due to
vest
Value from share
price increase1
Value of
dividend
equivalents2,3
267,748
198,583
189,850
59,364
-
58,375
13%
13%
13%
27,090
25,816
17,092
Nil
Nil
Nil
Nil
Nil
Nil
Total value
vesting3
70,339
67,031
44,379
1 There was no share price appreciation from the date of grant (£4.148) to the three-month average share price to 31 December 2023 (£2.60).
2 There were no dividends paid between the date of grant and 31 December 2023.
3 Value of shares based on a three-month average share price of £2.60 to 31 December 2023. This value will be restated next year based on the actual share price on the date of vesting.
What equity awards have been granted during the year? (Audited)
The Executive Directors received the following awards under the Performance Share Plan (“PSP”) and the Deferred Annual Bonus Plan
during the year.
Type of
award
Number
of shares
Face
value (£)1
Face value as a
% of salary
Threshold
vesting
End of performance
period
Duncan Painter
Duncan Painter
Mandy Gradden
Mandy Gradden
Mandy Gradden
Paul Harrison
Philip Thomas
PSP (Feb)
DABP (Apr)
PSP (Feb)
PSP (Dec)
DABP (Apr)
DABP (Feb)
PSP (Dec)
421,624
67,224
312,710
74,349
49,859
54,475
320,072
1,138,386
161,231
844,319
218,467
119,582
130,654
940,500
200%
40%
200%
50%
40%
40%
200%
25% 31 December 2025
n/a
n/a
25% 31 December 2025
25% 31 December 2025
n/a
n/a
n/a
n/a
25% 31 December 2025
1
The 2023 PSP and DABP awards were granted as conditional awards. Face value has been calculated using the average closing share price for the five business days immediately
preceding the date of grant of the award which was £2.70 in February 2023, £2.40 in April 2023 and £2.93 in December 2023.
February 2023 PSP Awards
In February 2023, the Committee granted Performance Share awards with a face value of 200% of salary to the incumbent CEO and the
CFO. With regard to the award’s performance targets, the Committee agreed that as in prior years the awards should be based on EPS
(75% weighting) and a Digital Commerce Revenue target (25% weighting). These metrics remained core medium to long-term targets to
support sustained profitable growth and better alignment with the Board’s business strategy objectives of expanding our global leadership
as a provider of specialist information, analytics and ecommerce optimisation, with a special focus in digital commerce. While at the time
of setting the targets the potential for separation was understood, the Committee resolved that it was appropriate to set targets on a
business-as-usual basis until such time as the terms of separation were finalised.
The performance criteria attaching to the PSP awards granted in February were therefore as follows:
Performance criteria
Weighting
Threshold
(25% vesting)
Stretch (100%)
Measurement period
Adjusted EPS growth
Digital Commerce Business Unit Revenue
75%
25%
16.2p
£321m
22.2p
£374.5m
1 January 2023 – 31 December 2025
1 January 2023 – 31 December 2025
Both the EPS and Digital Commerce Revenue targets were set having taken into account internal planning and external market
expectations for future performance as at the date of the award in February 2023. To ensure the EPS target is a realistic incentive, it was set
and will be tested using constant tax rates in light of the prevailing uncertainties around future corporate tax rates, particularly in the US
which has and continues to represent an increasing proportion of Ascential’s business. In terms of the degree of stretch in the targets, they
were set with a view to striking the right balance between being realistic at the threshold performance levels and stretching at the top end
of the range set and, most importantly, aligning with the expected growth through to the end of 2025. The Committee will consider the
overall vesting result in the context of broader Company performance on vesting, as well as making any adjustments required to reflect
material M&A activity that takes place during the performance period.
118
Ascential plc Annual Report 2023 With regard to the Adjusted EPS target, the Committee intends to restate it so that it can be measured consistently using the continuing
operations of the Company once the form of the return of value is determined and any associated impact on Ascential’s ongoing capital
structure. This will result in the target fulfilling its original intent and being similarly challenging to when set. This approach is consistent
with adjustments made for divestments in prior years. With regard to the Digital Commerce Business Unit Revenue target that applied to
the award on grant, the Committee approved the replacement of these with Ascential plc revenue targets set based on the same
assumptions as the original targets but reflecting the continuing operations of the Company. This ensures that the targets will be similarly
challenging but reflect the post-separation business. The same approach was also taken in relation to the 2022 Adjusted EPS and Digital
Commerce Business Unit Revenue targets (disclosed in the 2022 Directors’ Remuneration Report). Having had regard to the balance of the
time period for each award and commercial sensitivity, the targets will be disclosed, along with performance against them, no later than at
the time of vesting of each award.
December 2023 PSP Awards
As detailed above, and in the Chair’s introductory statement, a Performance Share Plan award was granted in the year to the current CEO,
Philip Thomas.
Given the differing nature of the businesses within the Group, the December award was the first Performance Share award granted to
Philip Thomas since 2021 and so from 2023, without the December award, he would not have held an ongoing long-term incentive award.
As a result, to ensure that there would be continuity of incentives and targets between the Executive Directors, and to directly incentivise
him to drive the forecast benefits from Ascential post separation, the Committee granted him an award in December 2023.
The current CEO’s award had a face value of 200% of salary which is in line with the normal award policy for the role of CEO at Ascential.
The award was subject the EPS targets (60% of the award) and revenue targets (20% of the award), adjusted to take account of the
separation, as set out above. In addition, 20% of the award was also subject to strategic targets aligned with maximising the benefits and
value from the post-separation Ascential business. With the specific targets being commercially sensitive, a summary is set out below with
full disclosure of the targets and the performance against them to be disclosed at vesting:
Strategic targets to be met by the end of the Performance Period (31 December 2025)
Vesting
Diversified growth
Growth in Money20/20 product into adjacent markets and geographies
• Achieve <1 target: 0% vests
Shareholder value creation
Deliver on post-separation shareholder returns.
Strategic projects
Delivered with reference to separation plans
• Achieve 1 target: 25% vesting
• Achieve 2 targets: 62.5% vests
• Achieve 3 targets: 100% vests
Given the importance of delivering the Board’s strategy post separation, and to ensure full alignment between the CEO and CFO, the CFO
was granted a top-up award of Performance Shares with a face value of 50% of salary at the same time as the award was made to the
current CEO. The top-up recognised the exceptional circumstances of the separation and ensured that both Directors had the same
proportion of their awards subject to EPS, revenue and strategic targets (i.e. both Executive Directors were fully aligned in their incentives
post separation).
To the extent awards vest in 2026, any shares delivered will be subject to a two-year holding period.
119
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Annual report on remuneration continued
What other interests do the Directors have in Ascential share plans?
The tables below summarise the interests the Executive Directors have in Ascential share plans.
Duncan Painter
Scheme
Interests at
1 Jan 2023
Granted
in year
Lapsed
in year
Exercised
in year
Interests at
31 Dec 2023
Date
of grant
Exercise
price (£)
Vesting
date
Expiry
date
PSP
PSP
PSP
PSP
DABP
DABP
DABP
DABP
SAYE
SAYE
Total
381,626
267,748
329,717
-
19,201
61,409
205,715
-
5,921
9,944
1,281,281
-
-
-
421,624
-
-
-
67,224
-
-
488,848
-
240,658
-
-
-
-
-
-
5,921
-
246,579
-
-
-
-
19,201
61,409
-
-
-
-
1-Oct-20
381,626
1-Sep-21
27,090
329,717
6-Apr-22
421,624 23-Feb-23
7-Mar-17
1-Oct-20
6-Apr-22
15-Apr-23
- 26-Sep-19
7-Oct-22
-
-
205,715
67,224
9,944
80,610 1,442,940
1-Oct-23 30-Sep-30
nil
1-Sep-24 31-Aug-31
nil
nil
5-Apr-32
6-Apr-25
nil 23-Feb-26 22-Feb-33
7-Mar-20
nil
6-Mar-27
1-Oct-23 30-Sep-30
nil
nil
5-Apr-32
6-Apr-25
14-Apr-33
15-Apr-25
nil
30-Apr-23
1-Nov-22
3.04
30-Apr-26
1-Nov-25
1.81
Mandy Gradden
Scheme
Interests at
1 Jan 2023
Granted
in year
Lapsed
in year
Exercised
in year
Interests at
31 Dec 2023 Date of grant
Exercise
price (£)
Vesting
date
Expiry
date
PSP
PSP
PSP
PSP
PSP
DABP
DABP
DABP
SAYE
SAYE
Total
Paul Harrison
Scheme
PSP
PSP
DABP
DABP
SAYE
Total
225,229
198,583
244,545
-
-
20,709
76,287
-
5,921
9,944
781,218
-
-
-
312,710
74,349
-
-
49,859
-
-
436,918
-
172,767
-
-
-
-
-
-
5,921
-
178,688
1-Oct-20
225,229
-
1-Sep-21
25,816
-
244,545
6-Apr-22
-
312,710 23-Feb-23
-
74,349 28-Dec-23
-
1-Oct-20
20,709
-
6-Apr-22
76,287
-
15-Apr-23
49,859
-
1-Nov-19
-
-
-
7-Oct-22
9,944
- 1,039,448
1-Oct-23 30-Sep-30
nil
1-Sep-24 31-Aug-21
nil
nil
5-Apr-32
6-Apr-25
nil 23-Feb-26 22-Feb-22
nil 28-Dec-26 27-Dec-33
1-Oct-23 30-Sep-30
nil
nil
5-Apr32
6-Apr-25
14-Apr-33
15-Apr-26
nil
30-Apr-23
1-Nov-22
3.04
30-Apr-26
1-Nov-25
1.81
Interests at
1 Jan 2023
Granted
in year
Lapsed
in year
Exercised
in year
Interests at
31 Dec 2023 Date of grant
Exercise
price (£)
Vesting
date
Expiry
date
189,850
233,790
83,496
-
5,405
512,541
-
-
-
54,475
-
54,475
172,758
118,175
-
-
5,405
296,338
-
-
-
-
-
-
17,092
115,615
83,496
54,475
1-Sep-21
6-Apr-22
6-Apr-22
15-Apr-23
- 24-Sep-01
270,678
nil
nil
nil
nil
£3.33
1-Sep-24 31-Aug-31
5-Apr-32
6-Apr-25
5-Apr-32
6-Apr-25
14-Apr-33
15-Apr-26
30-Apr-24
1-Nov-24
The closing share price of Ascential’s ordinary shares at 31 December 2023 was £2.93 and the closing price range from 1 January 2023 to
31 December 2023 was £1.88 to £2.95.
The Executive Directors can participate in the Ascential Save As You Earn scheme on the same terms as those open to the wider workforce.
Share options are granted at an option price which is a 20% discount on the share price on the date of offer. Options normally vest following
the conclusion of a three-year savings contract and will ordinarily be exercisable for a period of six months after the vesting date.
Ordinary shares required to fulfil entitlements under the PSP, RSP, DABP and SIP may be provided by Ascential’s Employee Benefit Trusts
(“EBT”). As beneficiaries under the EBT, the Executive Directors are deemed to be interested in the Ordinary Shares held by the EBT which,
at 31 December 2023, amounted to 3,156,022 shares. Assuming that all outstanding awards made under Ascential’s share plans vest in full,
Ascential has utilised 4.9% of the 10% in ten years and 3.9% of the 5% in five years’ dilution limits.
120
Ascential plc Annual Report 2023 What pension payments were made in 2023?
(Audited)
The table below provides details of the Executive Directors’ pension
benefits:
Duncan Painter
Mandy Gradden
Paul Harrison*
Cash in lieu of contributions
to DC type pension plan
(£’000s)
53
39
17
* Paul Harrison stepped down as a Director with effect from 30 September 2023.
Each Executive Director has the right to participate in Ascential’s
defined contribution pension plan or to elect to be paid some or all
of their contribution in cash. Pension contributions and/or cash
allowances are capped at 9% of salary for the CEO and CFO, and 5%
of salary for the COO.
Were there any payments made to past Directors
during 2023? (Audited)
Remuneration arrangements for Paul Harrison (September 2023)
As set out in last year’s Directors’ Remuneration Report, the
three-way separation of the Group’s businesses significantly
reduced the scope of the COO role and so this role effectively
became redundant during the year as the individual businesses
were restructured internally in preparation of the sale process.
As a result, Paul Harrison stepped down from the Board and
ceased employment with the Company on 30 September 2023.
With regard to the remuneration payments made or to be made
in connection with his cessation of employment they are set
out below:
• Salary, pension and contractual benefits continued to be paid
and received for the period to 30 September 2023. These values
are included in the Single Figure Table above. There was no
payment in lieu of any notice.
•
In line with the Directors’ Remuneration Policy and the relevant
plan Rules, with his cessation of employment being considered
redundancy by the Committee, he was treated as good leaver in
relation to his incentives. This resulted in the following treatment:
• He was eligible to receive a pro rata bonus for the part
year of his employment. The bonus, as detailed in the Single
Figure Table, was £377,000. In line with the Remuneration
Policy, 50% will be paid in cash and 50% deferred into shares
for three years.
• The deferred share awards held in relation to prior year
• His 2021 PSP award over 189,850 shares and his 2022 PSP
award over 233,790 shares remained eligible to vest on their
normal vesting dates subject to a pro rata reduction to reflect
the proportion of the full three-year period he was in
employment and the performance conditions applying to the
awards. No award was granted to the COO in 2023. The Single
Figure table also includes amounts in respect of the 2021 PSP
Award, prorated as applicable. Any awards that vest will be
subject to a two-year holding period.
•
In line with the Company’s share ownership guidelines, all
awards must be retained until the end of their vesting and
holding periods.
Remuneration arrangements for Duncan Painter (January 2024)
Duncan Painter, the former Chief Executive of Ascential, stepped
down from the Board and left the Company on 2 January 2024 as
part of the sale of the Digital Commerce business to serve as Chief
Executive Officer of Flywheel Digital, a new practice area within
Omnicom Group Inc. The remuneration payments made or to be
made in connection with his cessation of his employment are set
out below:
• Salary, pension and contractual benefits continued to be paid
until his cessation of employment on 2 January 2024. The
amounts paid in relation to 2023 are included in the Single
Figure Table. There was no payment in lieu of any notice.
•
In line with the Directors’ Remuneration Policy and the relevant
plan Rules, with his cessation of employment as a result of the
sale of Digital Commerce, he was treated as good leaver in
relation to his incentives. This resulted in the following treatment:
• He was eligible to receive a full year bonus for 2023 given he
was in employment for the full financial year. The bonus, as
detailed in the Single Figure Table, was £637,000. In line with
the Remuneration Policy, 50% will be paid in cash and 50%
deferred into shares for three years.
• The deferred share awards held in relation to prior year
bonuses earned remained eligible to vest on their normal
vesting date. This included his 2022 award over 205,715 shares
and his 2023 award over 67,224 shares.
• His 2020 381,626 PSP award over 2021 PSP award over 267,748
shares, his 2022 PSP award over 329,717 shares and his 2023
award over 421,627 shares remained eligible to vest on their
normal vesting dates subject to a pro rata reduction to reflect
the proportion of the full three-year period he was in
employment and the performance conditions applying to
the awards. The Single Figure table also includes amounts in
respect of the 2021 PSP Award, prorated as applicable. Any
awards that vest will be subject to a two-year holding period.
bonuses earned remained eligible to vest on their normal
vesting date. This included his 2022 award over 83,496 shares
and his 2023 award over 54,475 shares.
•
In line with the Company’s share ownership guidelines, all
awards must be retained until the end of their vesting and
holding periods.
121
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Annual report on remuneration continued
What are the Directors’ shareholdings and is there a guideline? (Audited)
To align the interests of the Executive Directors with shareholders, each Executive Director must build up and maintain a shareholding in
Ascential equivalent to 200% of base salary. Until the guideline is met, Executive Directors are required to retain 50% of any share awards
that vest (or are exercised) net of tax. Details of the Directors’ interests in shares (including those of their connected persons) are shown in
the table below:
Director
Duncan Painter
Mandy Gradden
Paul Harrison1
Scott Forbes
Suzanne Baxter
Rita Clifton
Joanne Harris
Judy Vezmar
Gillian Kent
Charles Song
Total
Beneficially
owned at
31 Dec 2023
Beneficially
owned at
31 Dec 2022
Shareholder
guideline
achieved?
PSP
DABP3
SAYE3
Not vested2
Vested but
not exercised
Not vested
Not vested
3,856,685
1,274,962
174,244
224,203
5,000
11,000
–
50,000
–
–
5,596,094
4,156,685
1,274,962
174,244
224,203
5,000
–
–
50,000
–
–
5,885,094
Yes 1,019,089
830,187
Yes
240,090
No
–
n/a
–
n/a
–
n/a
–
n/a
–
n/a
–
n/a
–
n/a
2,089,366
–
20,709
–
–
–
–
–
–
–
–
20,709
272,939
126,146
137,971
–
–
–
–
–
–
–
537,056
9,944
9,944
–
–
–
–
–
–
–
–
19,888
1 Paul Harrison was appointed as COO with effect from 11 January 2021 and ceased employment on 30 September 2023.
2 All outstanding PSP awards are subject to performance conditions.
3 Awards under the DABP and SAYE are not subject to performance conditions, other than service-based conditions.
How does the CEO’s pay compare to Ascential’s performance?
This graph shows a comparison of Ascential’s total shareholder return (share price growth plus dividends paid) with that of the FTSE 250
(excluding investment trusts) since Admission. This index has been selected as it comprises companies of a comparable size and provides
an indication of Ascential’s relative performance.
)
d
e
s
a
b
e
r
(
)
£
(
e
u
a
V
l
250
200
150
100
50
0
8 Feb 2016
31 Dec 2016
31 Dec 2017
31 Dec 2018
31 Dec 2019
31 Dec 2020
31 Dec 2021
31 Dec 2022
31 Dec 2023
Ascential plc
FTSE 250 (excluding investment trusts)
This graph shows the value, by 31 December 2023, of £100 invested in Ascential plc at the IPO Offer Price on 08 February 2016, compared with the value of £100 invested
in the FTSE 250 (excluding investment trusts). Source: Datastream (Refinitiv)
The total remuneration figure for the CEO for each year since IPO is shown below. The total remuneration figure includes the annual
bonus in the performance year to which it relates (included any amount deferred into shares).
Total Remuneration (£’000)
Annual bonus (% of maximum)
Long-Term Incentive Plan (% of maximum vesting)
2017
856
48
n/a
2018
2,167
20
100
2019
1,681
26
83
2020
647
0
12
2021
1,301
100
0
2022
2023
948
46
n/a
1,364
87
13
122
Ascential plc Annual Report 2023
How does the change in Director’s pay and benefits compare to that for Ascential employees?
The historic movement in the salary, taxable benefits and annual bonus for the Directors compared to the UK employee average is shown below.
Average percentage change
2019-2020
Taxable
benefits
Salary/
Fee
Annual
bonus
Average percentage change
2020-2021
Taxable
benefits
Salary /
Fee
Annual
bonus
Average percentage change
2021-2022
Taxable
benefits
Salary/
Fee
Annual
bonus
Average percentage change
2022-2023
Taxable
benefits
Salary/
Fee
Annual
bonus
Executive Directors:
Duncan Painter
Mandy Gradden
Paul Harrison1
Non-Executive Directors:
Scott Forbes
Suzanne Baxter
Rita Clifton
Gillian Kent
Joanne Harris
Paul Harrison
Charles Song2
Judy Vezmar
All employees3
(12%)
(10%)
n/a
(6%)
n/a
(9%)
(10%)
n/a
(12%)
n/a
(10%)
(5%)
(30%)
(100%)
0% (100%)
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
nm
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
nm
1%
3%
n/a
0%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
3%
42%
0%
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
nm
nm
nm
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
nm
2%
2%
2%
0%
0%
0%
0%
nm
0%
7%
0%
4%
2%
1%
(6%)
(54%)
(54%)
(54%)
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
nm
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
nm
3%
3%
nm
5%
19%
4%
4%
nm
n/a
nm
15%
3%
15
(13%)
nm
98%
98%
nm
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
nm
n/a
n/a
n/a
n/a
n/a
n/a
n/a
n/a
nm
1 Paul Harrison stepped down from the Board on 30 September 2023 and therefore a full year comparison is not meaningful.
2 Charles Song is paid in Hong Kong dollars and there was no increase in his fee in local currency. The change above reflects FX movement between HKD and GBP.
3 Only senior employees are eligible for an annual bonus and therefore the change in bonus for the average UK employee is not meaningful.
What is the ratio of CEO pay to the average UK employee?
The below table sets out the CEO’s total remuneration as a ratio to UK employees’ total remuneration on the 25th, 50th and 75th percentile.
Year
1 January to 31 December 2023
1 January to 31 December 2022
1 January to 31 December 2021
1 January to 31 December 2020
1 January to 31 December 2019
Method
Option A
Option A
Option A
Option A
Option A
25th percentile
pay ratio
Median
pay ratio
75th percentile
pay ratio
31
42
64
31
48
22
23
32
18
33
15
14
19
11
22
The salary and total pay of the UK employee on each of the 25th, 50th and 75th percentiles are shown below:
Percentile
25th
Median
75th
Total Salary
(£000)
Total Pay
(£000)
40
58
85
43
61
90
We have adopted Method A to calculate the above ratios as it is the most statistically accurate. This means that we have calculated total
pay for all UK employees, using the same methodology that is used to calculate the CEO’s single figure, using 31 December 2023 as the
reference date. Underpinning our pay and progression principles is a need to provide a competitive total reward so as to enable the
attraction and retention of high calibre individuals without overpaying, and providing the opportunity for individual development and
career progression. The pay ratios reflect the changes in individual accountability which is recognised through our pay structures, which
include greater variable pay opportunity for more senior positions. This is reflected in the fact that the CEO’s variable pay opportunity is
higher than those employees noted in the table, reflecting the weighting towards long-term value creation and alignment with shareholder
interests inherent in his role. We are satisfied that the median pay ratio is consistent with our wider pay, reward and progression policies for
employees. All our employees have the opportunity for annual pay increases, career progression and development opportunities.
123
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Annual report on remuneration continued
How much does Ascential spend on pay and dividends? (Audited)
Total employee costs
Dividend per ordinary share
What advice did the Committee receive?
2023
£300.4m
0p
2022
£271.0m
0p
Korn Ferry are the appointed advisers to the Remuneration Committee and provide advice and information on market practice, the
governance of executive pay and the operation of employee share plans. The total fees paid to Korn Ferry in respect of their services for
the 2023 financial year were £169,000 plus VAT. This included £102,000 plus VAT in relation to the separation and sale of Digital Commerce
and WGSN. Korn Ferry provides other consulting services to the Board in relation to its recruitment of Non-Executive Directors which is
provided by an entirely separate team independent from the team advising the Committee. As a result, the advice to the Committee is
therefore considered independent. Korn Ferry are signatories to the Remuneration Consultant’s Code of Conduct, which requires that
advice to be objective and impartial.
What votes were received at the AGM in relation to the Directors’ Remuneration Policy and the Annual Report
on Remuneration?
Votes cast in favour
Votes cast against
Total votes cast
Abstentions
Remuneration Policy
at the 2023 AGM
362,835,042
30,266,677
393,101,719
14,828
%
92.3
7.7
Annual Report on
Remuneration at the
2023 AGM
384,046,954
9,054,633
393,101,587
14,960
%
97.7
2.3
How will the Directors’ Remuneration Policy be used in the 2024 financial year?
Base salary
Our usual practice is to review Executive Directors’ salaries with effect from 1 April each year. With our UK salary budget set at 4% of salary,
the Committee awarded salary increases of 3% of salary to the CFO. Given the CEO’s appointment on 2 January 2024, he will not be
eligible for a salary increase in April 2024. Therefore, the salaries effective from 1 April 2024 are £580,000 for the CEO, and £450,043 for
the CFO.
Annual bonus plan
The annual bonus plan will continue to be subject to a maximum of 125% of base salary and measured against stretching financial targets.
50% of the bonus will be based on Operating Profit and 50% will be based on Revenue. Half of any bonus earned will be deferred into
shares which vest after a three-year period.
The Committee has chosen not to disclose, in advance, the performance targets for the forthcoming year as these include items which
the Committee considers commercially sensitive. An explanation of bonus payouts and performance achieved, along with the targets set,
will be provided in next year’s Annual Report on Remuneration.
124
Ascential plc Annual Report 2023 Performance Share Plan
In line with the Policy, the Committee intend to grant Philip Thomas, the Chief Executive, and Mandy Gradden, the Chief Financial Officer,
awards over shares with a value at grant of 200% of salary.
The performance will be measured against Adjusted EPS, Adjusted Operating Profit and Revenue targets. Each element will be assessed
independently, with EPS determining 50% of the award vesting, and Adjusted Operating Profit 25% and Revenue 25%.
The targets will assess the performance of the group over the period to 31 December 2026, and therefore exclude the divested Digital
Commerce and WGSN businesses. Adjusted Operating Profit has been introduced for the FY 2024 award given organic growth in
operating profit is a key focus for the next three years and its inclusion also reflects the Committee’s objective of setting balanced targets.
Given the return of value will impact the capital structure of the Company, and its impact cannot be fully determined at the time of setting
the award’s targets, including Operating Profit in the targets results in participants having a clear understanding of the profitable growth
being targeted by Company. This provides a cleaner line of sight at the start of the performance period than the EPS targets given these
will need to be adjusted following the return of value to reflect the capital structure at that time. However, it was considered important to
retain EPS as the primary target given it is the most comprehensive measure of financial performance and provides the greatest alignment
with shareholders. Revenue remains a key performance indicator for the Company and core to our delivery of shareholder value creation.
The 2024 award will be the first year at Ascential where the same performance metrics and targets will apply to all recipients of awards so
that there is full alignment across the executive leadership team. This was a consideration when selecting both the performance metrics
and their respective weightings.
It is the Committee’s intention to review the choice of performance metrics and their weightings in advance of granting awards in 2025.
In light of current commercial circumstances, the Committee remains in the process of finalising the specific targets to apply to the 2024
PSP awards. The targets are being set to be similarly challenging to those set in prior years.
What are the current and future Non-Executive Director fees?
The fees of the Chair and Non-Executive Directors were reviewed in January 2023, taking into account both past and future expected time
commitment for the roles, and typical fee levels in FTSE 250 companies. The Conclusion of the review was that the fees should be
increased to better reflect the increased time commitment of the roles. There are no changes proposed to these fees for 2024. Rita
Clifton, Senior Independent Director, has been appointed as Chair of the Nomination Committee (previously Scott Forbes) and will be paid
an additional fee of £10,000 per annum in respect of this appointment.
Board Chair
Basic fee
Additional fee for Senior Independent Director
Additional fee for Nomination Committee Chair
Additional fee for Audit Committee Chair
Additional fee for Remuneration Committee Chair
2024
235,000
58,000
10,000
10,000
20,000
20,000
2023
% Change
235,000
58,000
10,000
-
20,000
20,000
-
-
-
nm
-
-
125
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Directors’
Report
Index to principal Directors’ Report and Listing
Rule disclosures
Relevant information required to be disclosed in the Directors’
Report may be found in the following sections:
Information
Section in Annual Report
Corporate Governance
Report
Strategic Report
Directors’ Report
Strategic Report
Strategic Report
Notes to the Financial
Statements
Notes to the Financial
Statements
Strategic Report
Strategic Report
Business model
Principal risks and uncertainties Strategic Report
Directors’ Report
Disclosure of information
to auditor
Directors in office during the
year
Dividend recommendation
for the year
Directors’ indemnities
ESG
Greenhouse gas emissions
Financial instruments – risk
management objectives and
policies
List of subsidiaries and
branches outside of the UK
Future developments of
the Company
Employment policies and
employee involvement
Stakeholder engagement
Structure of share capital,
including restrictions on
the transfer of securities,
voting rights and interests
in voting rights
Political donations
Rules governing changes to
Articles of Association
Going concern statement
Post balance sheet events
Directors’ Report
Directors’ Report
Strategic Report and
Directors’ Report
Strategic Report
Directors’ Report
Strategic Report
Notes to the Financial
Statements
Statement of compliance
with the UK Corporate
Governance Code
Corporate Governance
Framework
Page
10
32
128
89
31
126
56
68
180
190
7
42 and
127
48
126
127
127
31
186
93
The above information is incorporated by reference and together
with the information in the Corporate Governance Framework on
pages 88 to 93 forms the Directors’ Report in accordance with
section 415 of the Companies Act 2006.
Strategic Report
The Strategic Report is set out on pages 4 to 79 and was approved
by the Board on 25 March 2024. It is signed on behalf of the Board
by Philip Thomas, Chief Executive.
Cautionary statement
The review of the business and its future development in the
Annual Report has been prepared solely to provide additional
information to shareholders to assess the Group’s strategies and
the potential for these strategies to succeed. It should not be relied
on by any other party for any other purpose. The review contains
forward-looking statements which are made by the Directors in
good faith based on information available to them at the time of
the approval of these reports and should be treated with caution
due to inherent uncertainties associated with such statements.
The Directors, in preparing the Strategic Report, have complied
with s417 of the Companies Act 2006.
Directors’ indemnities
The Company maintained appropriate insurance to cover
Directors’ and Officers’ liability for itself and its subsidiaries and
such insurance was in force for the whole of the year ended
31 December 2023.
The Company also indemnifies the Directors under deeds of
indemnity for the purposes of section 236 of the Companies Act
2006. Such indemnities contain provisions that are permitted by
the director liability provisions of the Companies Act 2006 and
the Company’s Articles of Association.
Share capital and rights attaching to shares
Details of the Company’s share capital and movements during
the year are set out in Note 24 to the financial statements, which is
incorporated by reference into this report. This includes the rights
and obligations attaching to shares and restrictions on the transfer
of shares. The ordinary shares of £0.01 each are listed on the
London Stock Exchange (LSE: ASCL.L). The ISIN of the shares
is GB00BYM8GJ06.
All ordinary shares (this being the only share class of the
Company) have the same rights (including voting and dividend
rights and rights on a return of capital) and restrictions as set
out in the Articles.
Without prejudice to any rights attached to any existing shares and
subject to relevant legislation, the Company may issue shares with
such rights or restrictions as determined by either the Company
by ordinary resolution or, if the Company passes a resolution to so
authorise them, the Directors.
Subject to legislation, the Articles and any resolution of the
Company, the Directors may offer, allot (with or without conferring
a right of renunciation), grant options over or otherwise deal with
or dispose of any shares to such persons, at such times and
generally on such terms as the Directors may decide. The
Company may issue any shares which are to be redeemed, or are
liable to be redeemed, at the option of the Company or the holder,
on such terms and in such manner as the Company may
determine by ordinary resolution and the Directors may determine
the terms, conditions and manner of redemption of any such
shares. No such resolutions are currently in effect.
Subject to recommendation of the Board, shareholders may
receive a dividend. Shareholders may share in the assets of the
Company on liquidation.
126
Ascential plc Annual Report 2023 Voting rights
Each ordinary share entitles the holder to attend, speak and vote at
general meetings of the Company. A resolution put to the vote of
the meeting shall be decided on a poll rather than a show of hands
in line with recommended best practice.
On a poll, every member who is present in person or by proxy shall
have one vote for every share of which they are a holder. The
Articles provide a deadline for submission of proxy forms of not
less than 48 hours before the time appointed for the holding of the
meeting or adjourned meeting. No member shall be entitled to
vote at any general meeting either in person or by proxy, in respect
of any share held by him, unless all amounts presently payable by
him in respect of that share have been paid. Save as noted, there
are no restrictions on voting rights nor any agreement that may
result in such restrictions.
Shares held by the Employee Benefit Trust (“EBT”)
The Group has an Employee Benefit Trust which can hold shares
to satisfy awards under employee share schemes. At 31 December
2023, the EBT held 3,156,022 shares. Voting rights in relation to any
shares held in the EBT are exercisable by the trustee; however, in
accordance with best practice guidance, the trustee abstains from
voting.
The Group additionally has a UK SIP Trust which can hold shares
to satisfy awards under the Ascential UK Share Incentive Plan.
At 31 December 2023, the SIP Trust held 604,189 shares. Voting rights
in relation to any shares held in the SIP Trust are exercisable by the
trustee; however, in accordance with best practice guidance, the
trustee abstains from voting.
Restrictions on transfers of securities
The Articles do not contain any restrictions on the transfer of
ordinary shares in the Company other than the restrictions
imposed by laws and regulations.
Changes to the Company’s Articles
The Company’s Articles of Association may only be amended
by a special resolution at a general meeting of shareholders.
Political contributions
The Company has not made any political donations or incurred
any political expenditure during the year in line with the
Company’s policy.
Interest in voting rights
Details of the share capital of the Company are set out in Note 24
to the financial statements.
As at 31 December 2023 and 20 March 2024, the Company had
received notifications in accordance with the FCA’s Disclosure and
Transparency Rule 5.1.2 of the following interests in the voting
rights of the Company.
As at
31 December
2023 Percentage
of voting rights
over ordinary
shares of
£0.01 each
n/a
5.61%
5.27%
2.03%
n/a
5.05%
5.05%
4.99%
4.99%
4.98%
4.95%
4.95%
4.91%
As at 20 March
2024 Percentage
of voting rights
over ordinary
shares of
£0.01 each
7.78%
5.79%
5.27%
5.17%
5.16%
5.05%
5.05%
4.99%
4.99%
4.98%
4.95%
4.95%
4.91%
Shareholder
J.P. Morgan Securities plc
Black Rock Inc
Blacksheep Master Fund Ltd.
FIL Limited
JNE Partners LLP
Majedie Asset Management Limited
T Rowe Price Associates, Inc
Ameriprise Financial, Inc
Franklin Templeton Institutional, LLC
Janus Henderson Group Plc
AXA Investment Managers
Ninety One UK Ltd
Jupiter Fund Management Plc
Royal London Asset Management
4.90%
4.90%
Significant contracts
The only significant contract to which the Company is a party that
takes effect, alters or terminates upon a change of control of the
Company is the Revolving Credit Facility dated 8 January 2024,
which contains customary prepayment, cancellation and default
provisions including repayment of all loans provided on a change
of control.
Employment practices
All employment decisions are made irrespective of colour, race,
age, nationality, ethnic or national origin, sex, gender identity,
mental or physical disabilities, marital status or sexual orientation.
For employees who may have a disability, the Group ensures proper
procedures and equipment are in place to aid them. When it comes
to training, career development and promotion, all employees are
treated equally and job applications are always judged on aptitude.
Further details on the Group’s policies on engagement and
employment practices are set out on page 42 to 47.
127
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Directors’ Report continued
Auditor
Each of the Directors has confirmed that:
a. so far as the Director is aware, there is no relevant audit
information of which the Company’s auditor is unaware; and
b. the Director has taken all reasonable steps that he or she ought
to have taken as a Director to make himself or herself aware of
any relevant audit information and to establish that the
Company’s auditor is aware of that information.
This confirmation is given and should be interpreted in accordance
with section 418 of the Companies Act 2006.
Post balance sheet events
The reportable events after the reporting date of 31 December
2023 are set out in Note 31 to the financial statements on page 186.
Other information
An indication of likely future developments in the business and
particulars of significant events which have occurred since the
end of the financial year have been included in the Strategic
Report on pages 7 and 186.
Annual General Meeting
The AGM of the Company will take place at 9am on 9 May 2024
at The Rosewood Hotel, 252 High Holborn, London WC1V 7EN.
All shareholders have the opportunity to attend and vote, in person
or by proxy, at the AGM.
The Notice of AGM can be found in a separate booklet which is
being mailed out at the same time as this report. It is also available
at ascential.com. The Notice sets out the resolutions to be
proposed at the AGM and an explanation of each resolution. The
Directors consider that all of the resolutions set out in the Notice
of AGM are in the best interests of the Company and its
shareholders as a whole. To that end, the Directors unanimously
recommend that shareholders vote in favour of each of them.
Directors’ Responsibilities Statement
The Directors are responsible for preparing the Annual Report and
the Group and parent Company financial statements in
accordance with applicable law and regulations.
Company law requires the Directors to prepare Group and parent
Company financial statements for each financial year. Under that
law they are required to prepare the Group financial statements in
accordance with UK-adopted international accounting standards
and applicable law and have elected to prepare the parent
Company financial statements in accordance with UK accounting
standards, including FRS 102, the Financial Reporting Standard
applicable in the UK and Republic of Ireland.
Under company law the Directors must not approve the financial
statements unless they are satisfied that they give a true and fair
view of the state of affairs of the Group and parent Company and
of their profit or loss for that period. In preparing each of the
Group and parent Company financial statements, the Directors
are required to:
• select suitable accounting policies and then apply them
consistently;
• make judgements and estimates that are reasonable, relevant,
reliable and prudent;
• for the Group financial statements, state whether they have
been prepared in accordance with UK-adopted international
accounting standards;
• for the parent Company financial statements, state whether
applicable UK accounting standards have been followed, subject
to any material departures disclosed and explained in the parent
Company financial statements;
• assess the Group and parent Company’s ability to continue as a
going concern, disclosing, as applicable, matters related to
going concern; and
• use the going concern basis of accounting unless they either
intend to liquidate the Group or the parent Company or to
cease operations, or have no realistic alternative but to do so.
The Directors are responsible for keeping adequate accounting
records that are sufficient to show and explain the parent
Company’s transactions and disclose with reasonable accuracy at
any time the financial position of the parent Company and enable
them to ensure that its financial statements comply with the
Companies Act 2006. They are responsible for such internal
control as they determine is necessary to enable the preparation
of financial statements that are free from material misstatement,
whether due to fraud or error, and have general responsibility for
taking such steps as are reasonably open to them to safeguard the
assets of the Group and to prevent and detect fraud and other
irregularities.
Under applicable law and regulations, the Directors are also
responsible for preparing a Strategic Report, Directors’ Report,
Directors’ Remuneration Report and Corporate Governance
Statement that complies with that law and those regulations.
The Directors are responsible for the maintenance and integrity
of the corporate and financial information included on the
Company’s website. Legislation in the UK governing the
preparation and dissemination of financial statements may differ
from legislation in other jurisdictions.
128
Ascential plc Annual Report 2023 Responsibility Statement of the Directors in respect of the annual
financial report
We confirm to the best of our knowledge:
The financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair view
of the performance of the business, its financial position, assets,
liabilities, and profit or loss of the Company and the undertakings
included in the consolidation taken as a whole; and
The Strategic Report includes a fair review of the development and
performance of the business and the position of the issuer and
the undertakings included in the consolidation taken as a whole,
together with description of the principal risks and uncertainties
that they face.
We consider the Annual Report and Accounts, taken as a whole,
is fair, balanced and understandable and provides the information
necessary for shareholders to assess the Group’s position and
performance, business model and strategy.
In accordance with Disclosure Guidance and Transparency Rule
(“DTR”) 4.1.16R, the financial statements will form part of the annual
financial report prepared under DTR 4.1.17R and 4.1.18R. The
auditor’s report on these financial statements provides no
assurance over whether the annual financial report has been
prepared in accordance with those requirements.
The Directors’ Report of Ascential plc was approved by the Board
and signed on its behalf by
Naomi Howden
Company Secretary
25 March 2024
Ascential plc
Registered in England and Wales
Number 09934451
129
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Independent auditor’s report
to the members of Ascential plc
1. Our opinion is unmodified
We have audited the financial statements of Ascential plc (“the
Company”) for the year ended 31 December 2023 which comprise
the Consolidated Statement of Profit or Loss, Consolidated
Statement of Comprehensive Income, Consolidated Statement of
Financial Position, Consolidated Statement of Changes in Equity,
and Consolidated Statement of Cash Flows, Parent Company
Balance Sheet, Parent Company Statement of Changes in Equity,
and the related notes, including the accounting policies in note 2
to the Group financial statements and note 2 to the Parent
Company financial statements.
In our opinion:
• the financial statements give a true and fair view of the state of
the Group’s and of the parent Company’s affairs as at 31 December
2023 and of the Group’s loss for the year then ended;
Overview
Materiality: Group
financial statements
as a whole
Coverage
£3.8m (2022: £4.0m*)
1.8% (2022: 0.8%*) of benchmark
86% (2022: 74%*) of revenue from
continuing operations
Key audit matters
vs 2022
Event driven
New: Accounting for the Group’s
interest in Hudson
Parent Company
recurring risk
Recoverability of cost of
investment in subsidiary and
intra-Group debtors
Group revenue in 2022 included significant amounts from components that, in 2023,
have been classified as discontinued. In the 2023 financial statements, total revenue
from continuing operations for the year 2022 has been restated for discontinued
operations. The comparative information in relation to audit materiality and coverage
noted here has not been restated.
• the Group financial statements have been properly prepared in
accordance with UK-adopted international accounting standards;
*
• the parent Company financial statements have been properly
prepared in accordance with UK accounting standards,
including FRS 102 “The Financial Reporting Standard applicable
in the UK and Republic of Ireland”, and
• the financial statements have been prepared in accordance with
the requirements of the Companies Act 2006.
Basis for opinion
We conducted our audit in accordance with International
Standards on Auditing (UK) (“ISAs (UK)”) and applicable law. Our
responsibilities are described below. We believe that the audit
evidence we have obtained is a sufficient and appropriate basis for
our opinion. Our audit opinion is consistent with our report to the
audit committee.
We were first appointed as auditor by the shareholders on 16 July
2016. The period of total uninterrupted engagement is for the 8
financial years ended 31 December 2023. We have fulfilled our
ethical responsibilities under, and we remain independent of the
Group in accordance with, UK ethical requirements including the
FRC Ethical Standard as applied to listed public interest entities. No
non-audit services prohibited by that standard were provided.
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Ascential plc Annual Report 2023
2. Key audit matters: our assessment of risks of material misstatement
Key audit matters are those matters that, in our professional judgment, were of most significance in the audit of the financial statements
and include the most significant assessed risks of material misstatement (whether or not due to fraud) identified by us, including those
which had the greatest effect on: the overall audit strategy; the allocation of resources in the audit; and directing the efforts of the
engagement team. We summarise below the key audit matters, in decreasing order of audit significance, in arriving at our audit opinion
above, together with our key audit procedures to address those matters and, as required for public interest entities, our results from
those procedures. These matters were addressed, and our results are based on procedures undertaken, in the context of, and solely for
the purpose of, our audit of the financial statements as a whole, and in forming our opinion thereon, and consequently are incidental to
that opinion, and we do not provide a separate opinion on these matters.
Accounting for the Group’s
interest in Hudson MX, Inc.
(‘Hudson’)
(Net assets held for sale relating
to subsidiary acquired exclusively
with a view to resale £59.2m,
Deferred and contingent
consideration £65.7m, Finance
costs £116.7m; 2022: Total
investment £73.8m).
Refer to page 97
(Audit Committee Report),
page 149 (accounting policy)
and page 184 (financial
disclosures).
The risk
Our response
Accounting judgments
The Group has made additional investments
in Hudson and entered into new agreements
with other Hudson shareholders in the
current year which requires judgment in
accounting.
Our procedures included:
• Accounting analysis: We inspected the legal agreements and other
arrangements in place, including the structure of the Hudson
related transactions in the year, terms of equity and debt instruments,
and the relevant options to evaluate the entity’s accounting
conclusions of whether the Group has control of Hudson;
The Group’s equity and debt interests and
other arrangements (including the existence
of Put and Call options) in Hudson are
complex and there are multiple steps
required to reflect the changes in the
Group’s interest due to these pre-existing
relationships and other arrangements.
Judgment is required over the assessment of
whether the Group has control or significant
influence over Hudson.
In addition, given the proposed sale of
Hudson, judgment is required to determine
whether, and which, balances relating to
Hudson should be presented as held for sale
and/or discontinued operations.
Valuation and forecast-based assessment
The Group has acquired control of Hudson
during the year resulting in the need for a
fair value exercise for the business. This is
also of heightened complexity due to the
existence of pre-existing relationships and
other arrangements that exist both pre and
post-acquisition.
The identification and measurement of the
acquired identifiable intangible assets
acquired at fair value, and the valuation of
pre-existing relationships and other
arrangements, is inherently judgmental with
assumptions and estimates involved in
forecasting the future performance of
Hudson such as revenue growth.
Auditor judgment is required to assess
whether the Group’s estimates of the
valuations fall within an acceptable range.
The effect of these matters is that, as part of
our risk assessment, we determined that the
valuations have a high degree of estimation
uncertainty, with a potential range of
reasonable outcomes greater than our
materiality for the financial statements as a
whole, and possibly many times that
amount. The financial statements (Note 30)
disclose the sensitivities estimated by the
Group.
• Accounting analysis: We considered the status of the sale process
and evaluated the entity’s accounting conclusions in respect of
the relevant accounting standards for the presentation of Hudson
and related balances as discontinued operations and held for sale;
• Our valuation expertise: Using our sector experience, we
assessed, with the assistance of our own valuation specialists, the
value of Hudson, the valuation methodology applied and the
assumptions considered, including the valuation of the significant
option arrangements (both pre and post-acquiring control of
Hudson) that exist. We assessed the principles and integrity of the
models used to value the investment values recognised by the
Group for Hudson;
• Benchmarking assumptions: With the assistance of our own
valuation specialists, we compared the Group’s assumptions,
where it was possible, to externally derived data and to other
similar acquisitions. To assess whether the Group's discount rates
fell within a reasonable range, we assessed a range of reasonable
discount rates based on market data. Additionally, we inspected
independent evidence to consider corroborative and
contradictory evidence to challenge and assess the
reasonableness of management’s assumptions;
• Sensitivity analysis: We performed sensitivities over the Group's
assumptions for key inputs, such as revenue growth and discount
rates, to determine if reasonably possible changes in the
assumptions would result in material changes to the valuation
individually and in aggregate;
• Assessing transparency: We assessed whether the Group’s
disclosures reflected the inherent estimation uncertainty in the
valuation of Hudson, pre-existing relationships and other
arrangements, and the adequacy of the Group’s disclosures of the
judgments involved in accounting for Hudson, including exercising
judgment on the extent of detail disclosed. We further assessed
whether expenses presented as discontinued were only those that
were expected to cease on disposal of Hudson.
We performed the above tests rather than seeking to rely on any of
the Group’s controls because the nature of this matter is such that
we would expect to obtain audit evidence primarily through the
detailed procedures described.
Our results
We found the Group’s:
• treatment of Hudson as an associate until October 2023 and as a
controlled subsidiary thereafter, as well as the presentation and
disclosures as a discontinued operation and held for sale to be
acceptable; and
• valuation and disclosures of the acquisition, equity and debt
instruments and other arrangements to be acceptable.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Independent auditor’s report continued
2. Key audit matters: our assessment of risks of material misstatement (continued)
Recoverability of cost of
investment in subsidiary and
intra-Group debtors
Investment (£653.0m; 2022
£652.8m) Intra-Group debtors
(£94.5m; 2022 £93.5m).
Refer to page 189 (accounting
policy) and pages 190 and 193
(financial disclosures).
The risk
Low risk, high value
The amount of the Parent Company’s
investment in its subsidiary, which acts as an
intermediate holding company for the rest
of the Parent Company’s subsidiaries,
represents 87% (2022: 87%) of the Parent
Company’s assets. The carrying amount of
the intra-Group debtors balance comprises
substantially the remaining 13% (2022: 13%).
Their recoverability is not at a high risk of
significant misstatement or subject to a
significant level of judgment. However, due
to their materiality in the context of the
Parent Company financial statements, this is
considered to be the area that had the
greatest effect on our overall Parent
Company audit.
Our response
Our procedures included:
• Tests of detail: We compared the carrying amount of the Parent
Company’s only investment with the subsidiary’s draft balance
sheet to identify whether its net assets, being an approximation of
its minimum recoverable amount, were in excess of its carrying
amount. We also assessed whether the Group headed by the
subsidiary has historically been profit-making. We further
inspected legal documents relating to legal entity restructuring
undertaken in the year in order to effect the disposals of
discontinued operations;
• Tests of detail: We assessed 100% of intra-Group debtors to
identify, with reference to the relevant debtors’ draft balance
sheet, whether they have a positive net asset value and therefore
coverage of the debt owed, as well as assessing whether those
debtor companies have historically been profit-making.
We performed the tests above rather than seeking to rely on any of
the Parent Company’s controls because the nature of the balance
meant that detailed testing is inherently the most effective means
of obtaining audit evidence.
Our results
We found the Directors’ conclusion that there is no impairment to
the carrying amounts of the investment in the subsidiary and the
intra-Group debtors to be acceptable (2022: acceptable).
A Key Audit Matter in the prior year related to the valuation of contingent consideration liabilities in certain of the Group’s entities within
the Digital Commerce business. We continued to perform procedures over the valuation of contingent consideration liabilities. However,
following the settlement of some of these liabilities, and the post year-end contractual agreement with the purchaser on disposal of
those entities where contingent consideration liabilities were applicable, we have not assessed this as one of the most significant risks in
our current year audit.
In addition, a separate prior year Key Audit Matter related to the identification and valuation of acquired intangible assets for in-year
acquisitions. With the exception of Hudson, which is subject to a separate Key Audit Matter, there was only one acquisition in the
current year, hence this was not considered to be one of the most significant risks in our current year audit.
Consequently, neither of these matters were separately identified in our audit report this year.
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Ascential plc Annual Report 2023 3.
Our application of materiality and an overview of
the scope of our audit
Revenue benchmark from
continuing operations
£206m (2022: £524m*)
Group Materiality
£3.8m (2022: £4.0m*)
Materiality for the Group financial statements as a whole was set at
£3.8m (2022: £4.0m*), determined with reference to a benchmark
of Group revenue from continuing operations, of which it
represents 1.8% (2022: 0.8%*). We consider Group revenue from
continuing operations to be the most appropriate benchmark as it
provides a more stable measure year on year than Group profit
before tax from continuing operations.
Materiality for the Parent Company financial statements as a whole
was set at £3.7m (2022: £3.9m), determined with reference to a
benchmark of Parent Company total assets, of which it represents
0.5% (2022: 0.5%).
In line with our audit methodology, our procedures on individual
account balances and disclosures were performed to a lower
threshold, performance materiality, so as to reduce to an
acceptable level the risk that individually immaterial misstatements
in individual account balances add up to a material amount across
the financial statements as a whole.
Performance materiality was set at 75% (2022: 75%) of materiality
for the financial statements as a whole, which equates to £2.9m
(2022: £3.0m*) for the Group and £2.8m (2022: £2.9m*) for the
Parent Company. We applied this percentage in our determination
of performance materiality because we did not identify any factors
indicating an elevated level of risk.
We agreed to report to the Audit Committee any corrected or
uncorrected identified misstatements exceeding £0.2m (2022:
£0.2m), in addition to other identified misstatements that
warranted reporting on qualitative grounds.
Of the Group’s 23 continuing operations reporting components,
we subjected 5 to full scope audits for Group purposes. Of the
Group’s 69 discontinued operations reporting components, we
performed full scope audits for 4 components and performed
specified risk-focused audit procedures over revenue and revenue
related accounts over 3 components. Those subject to specified
risk-focused procedures were not individually financially significant
enough to require a full scope audit for group purposes, but were
included in the scope of our Group reporting work in order to
provide further coverage over the Group's results. In 2022*, of the
Group’s 93 reporting components, we subjected 11 to full scope
audits for group purposes, 5 to specified risk-focused audit
procedures over revenue and revenue related accounts and 1 to
specified risk-focused audit procedures over expenses.
The remaining 14% (2022: 26%*) of Group revenue from continuing
operations, 12% (2022: 11%*) of Group profit before tax from
continuing operations and 10% (2022: 13%) of Group total assets is
represented by 80 (2022: 76) reporting components, none of
which individually represented more than 5% (2022: 2%*) of any of
Group total revenue, Group total loss before tax or Group total
assets. For these components, we performed analysis at an
aggregated Group level to re-examine our assessment that there
were no significant risks of material misstatement within these.
The work on all components, including the Parent Company, was
performed by the Group team (2022: 13 of 17*).
£3.8m
Whole financial statements
materiality (2022: £4.0m*)
£2.9m
Whole financial statements
performance materiality
(2022: £3.0m*)
£2.3m
Range of materiality at
5 continuing operations
components (£1.1m-£1.8m)
and 7 discontinued operations
components (£1.2m-£2.3m)
(2022: 17 components £0.5m
to £2.3m*)
£0.2m
Misstatements reported
to the audit committee
(2022: £0.2m*)
Revenue
Group materiality
Group revenue from
continuing operations
Total profits and losses that
made up group loss before tax
from continuing operations
5%
88%
(2022: 89%*)
84%
88%
86%
(2022: 74%*)
7%
67%
86%
Group total assets
21%
16%
Full scope for group audit purposes 2023
Specified risk-focused audit procedures 2023
Full scope for group audit purposes 2022
Specified risk-focused audit procedures 2022
Residual components
90%
(2022: 87%*)
71%
69%
*
Group revenue, profit and assets in 2022 included significant amounts from
components that, in 2023, have been classified as discontinued and held for sale.
In the 2023 financial statements, total revenue and profit before tax from continuing
operations for the year 2022 has been restated for discontinued operations. The
comparative information in relation to audit materiality, coverage and scoping noted
here has not been restated.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023
Independent auditor’s report continued
3.
Our application of materiality and an overview of
the scope of our audit (cont.)
The scope of the audit work performed was predominantly
substantive as we placed limited reliance upon the Group’s internal
control over financial reporting.
4. The impact of climate change on our audit
We have considered the potential impacts of climate change on
the financial statements as part of planning our audit. As identified
on page 62, the Group has identified climate risks that could
impact the Group. These include changing customer behaviour
and the potential impacts on event attendance. We have
performed a risk assessment of how the impact of climate change
may affect the financial statements and our audit. The areas of
financial statements that could be primarily potentially exposed to
climate risk in the form of uncertainty is forward-looking
assessments related to long-life assets, such as goodwill
impairment. Taking into account the nature of the Group’s
business, the size and composition of the Group, and the level of
headroom in the impairment testing (see Note 16), we assessed
that there was no significant impact on the financial statements or
our audit approach this year from climate change. We have read
the disclosure of climate related information in the front half of the
annual report and considered consistency with the financial
statements and our audit knowledge.
5. Going concern
The Directors have prepared the financial statements on the going
concern basis as they do not intend to liquidate the Group or the
Company or to cease their operations, and as they have
concluded that the Group and the Company’s financial position
means that this is realistic. They have also concluded that there are
no material uncertainties that could have cast significant doubt
over their ability to continue as a going concern for at least a year
from the date of approval of the financial statements (“the going
concern period”).
We used our knowledge of the Group, its industry, and the general
economic environment to identify the inherent risks to its business
model and analysed how those risks might affect the Group’s and
the Company’s financial resources or ability to continue operations
over the going concern period. The risk that we considered most
likely to adversely affect the Group’s and the Company’s available
financial resources and metrics relevant to debt covenants over
the period was the cancellation of major events at short notice
due to any unforeseeable incident and the failure to sell Hudson.
We also considered less predictable but realistic second order
impacts, such as a significantly worse than expected change in
the macro-economic environment.
We considered whether these risks could plausibly affect the
liquidity or covenant compliance in the going concern period by
assessing the directors’ sensitivities over the level of available
financial resources and covenant thresholds indicated by the
Group’s financial forecasts taking account of severe, but plausible
adverse effects that could arise from these risks.
Our procedures also included:
• Critically assessing key assumptions in the Group’s forecast
using our knowledge of the business and knowledge of the
entity and the sector in which it operates;
• Considering sensitivities over the level of available financial
resources indicated by the Group’s financial forecasts taking
account of reasonably possible (but not realistic) adverse effects
that could arise from these risks individually and collectively;
• Assessing the current and available committed facilities to
understand the financial resources available to the Group during
the forecast period and any related covenant requirements;
• Assessing the Group’s historical forecasting accuracy by comparing
forecasts from prior years with actual results in those years; and
• Assessing the completeness of the going concern disclosure.
Our conclusions based on this work:
• we consider that the directors’ use of the going concern basis
of accounting in the preparation of the financial statements is
appropriate;
• we have not identified, and concur with the directors’
assessment that there is not, a material uncertainty related to
events or conditions that, individually or collectively, may cast
significant doubt on the Group’s or Company's ability to
continue as a going concern for the going concern period;
• we have nothing material to add or draw attention to in relation
to the directors’ statement in note 1 to the financial statements
on the use of the going concern basis of accounting with no
material uncertainties that may cast significant doubt over the
Group and Company’s use of that basis for the going concern
period, and we found the going concern disclosure in note 1 to
be acceptable; and
• the related statement under the Listing Rules set out on page 31
is materially consistent with the financial statements and our
audit knowledge.
However, as we cannot predict all future events or conditions and
as subsequent events may result in outcomes that are inconsistent
with judgments that were reasonable at the time they were made,
the above conclusions are not a guarantee that the Group or the
Company will continue in operation.
6.
Fraud and breaches of laws and regulations
– ability to detect
Identifying and responding to risks of material misstatement due
to fraud
To identify risks of material misstatement due to fraud (“fraud
risks”) we assessed events or conditions that could indicate an
incentive or pressure to commit fraud or provide an opportunity to
commit fraud. Our risk assessment procedures included:
• Enquiry of Directors, the Audit Committee, operational
managers and the Group’s in-house legal counsel, as well as
inspection of minutes meetings of the Board, Audit Committee
and Renumeration Committee;
•
Inspections of the Group’s policies and procedures to prevent,
detect and respond to the risks of fraud, internal audit reports issued
during the year and reports to the Group’s whistleblowing hotline;
134
Ascential plc Annual Report 2023 The potential effect of these laws and regulations on the financial
statements varies considerably.
Firstly, the Group is subject to laws and regulations that directly
affect the financial statements including financial reporting
legislation (including related companies legislation), distributable
profits legislation and taxation legislation, and we assessed the
extent of compliance with these laws and regulations as part of
our procedures on the related financial statement items.
Secondly, the Group is subject to many other laws and regulations
where the consequences of non-compliance could have a
material effect on amounts or disclosures in the financial
statements, for instance through the imposition of fines or
litigation. We identified the following areas as those most likely to
have such an effect: health and safety, data protection laws,
anti-bribery employment law, and certain aspects of company
legislation recognising the nature of the Group’s activities. Auditing
standards limit the required audit procedures to identify non-
compliance with these laws and regulations to enquiry of the
directors and other management, and inspection of regulatory and
legal correspondence, if any. Therefore if a breach of operational
regulations is not disclosed to us or evident from relevant
correspondence, an audit will not detect that breach.
Context of the ability of the audit to detect fraud or breaches of
law or regulation
Owing to the inherent limitations of an audit, there is an
unavoidable risk that we may not have detected some material
misstatements in the financial statements, even though we have
properly planned and performed our audit in accordance with
auditing standards. For example, the further removed non-
compliance with laws and regulations is from the venues and
transactions reflected in the financial statements, the less likely the
inherently limited procedures required by auditing standards would
identify it.
In addition, as with any audit, there remained a higher risk of
non-detection of fraud, as these may involve collusion, forgery,
intentional omissions, misrepresentations, or the override of
internal controls. Our audit procedures are designed to detect
material misstatement. We are not responsible for preventing
non-compliance or fraud and cannot be expected to detect
non-compliance with all laws and regulations.
• Consideration of remuneration incentive schemes and
performance targets for management, Directors and sales staff,
including the adjusted earnings per share target for
management remuneration;
• Analytical procedures to identify any unusual or unexpected
relationships; and
• Consultation with our forensic specialists to assist us identifying
fraud risk based on their experience of comparable businesses,
with similar circumstances, as well as geographies in which the
Group and the Company operate. The forensic specialists
participated in the initial fraud risk assessment discussions.
We communicated identified fraud risks throughout the audit
team and remained alert to any indications of fraud throughout
the audit.
As required by auditing standards, and taking into account possible
pressures to meet profit targets, we perform procedures to
address the risk of management override of controls, in particular
the risk that Group and component management may be in a
position to make inappropriate accounting entries and the risk of
bias in accounting estimates and judgments. On this audit we
do not believe there is a fraud risk related to revenue recognition
based on the following assessment:
• The accounting for the majority of the Group’s sales is not
complex, and subject to limited levels of judgement in the sales
process to fraudulently manipulate revenue.
We did not identify any additional fraud risks.
We performed procedures including:
•
Identifying and testing journal entries for all full scope and
specified risk-focused components to address the risk of
inappropriate journal entries being posted;
• Evaluating the business purpose of significant unusual
transactions; and
• Assessing whether the judgements made in making accounting
estimates are indicative of a potential bias.
Identifying and responding to risks of material misstatement due
to non-compliance with laws and regulations
We identified areas of law and regulations that could reasonably be
expected to have a material effect on the financial statements
from our general commercial and sector experience, and through
discussion with the Directors and other management (as required
by auditing standards), and discussed with the Directors and other
management the policies and procedures regarding compliance
with laws and regulations.
As the Group is regulated, our assessment of risks involved gaining
an understanding of the control environment including the entity’s
procedures for complying with regulatory requirements.
We communicated identified laws and regulations through our
team and remained alert to any indicators of non-compliance
throughout the audit.
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Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Independent auditor’s report continued
7.
We have nothing to report on the other
information in the Annual Report
The Directors are responsible for the other information presented
in the Annual Report together with the financial statements. Our
opinion on the financial statements does not cover the other
information and, accordingly, we do not express an audit opinion
or, except as explicitly stated below, any form of assurance
conclusion thereon.
Our responsibility is to read the other information and, in doing so,
consider whether, based on our financial statements audit work,
the information therein is materially misstated or inconsistent with
the financial statements or our audit knowledge. Based solely on
that work we have not identified material misstatements in the
other information.
Strategic report and Directors’ report
Based solely on our work on the other information:
• we have not identified material misstatements in the strategic
report and the Directors’ report;
•
•
in our opinion the information given in those reports for the
financial year is consistent with the financial statements; and
in our opinion those reports have been prepared in accordance
with the Companies Act 2006.
Directors’ remuneration report
In our opinion the part of the Directors’ Remuneration Report to be
audited has been properly prepared in accordance with the
Companies Act 2006.
Disclosures of emerging and principal risks and longer-
term viability
We are required to perform procedures to identify whether there is
a material inconsistency between the directors’ disclosures in
respect of emerging and principal risks and the viability statement,
and the financial statements and our audit knowledge.
Based on those procedures, we have nothing material to add or
draw attention to in relation to:
• the Directors’ confirmation within the Director’s Long-term
viability statement on page 34 that they have carried out a
robust assessment of the emerging and principal risks facing
the Group, including those that would threaten its business
model, future performance, solvency and liquidity;
• the Principal Risks disclosures describing these risks and how
emerging risks are identified, and explaining how they are being
managed and mitigated; and
• the Directors’ explanation in the Long-term viability statement of
how they have assessed the prospects of the Group, over what
period they have done so and why they considered that period
to be appropriate, and their statement as to whether they have a
reasonable expectation that the Group will be able to continue
in operation and meet its liabilities as they fall due over the period
of their assessment, including any related disclosures drawing
attention to any necessary qualifications or assumptions.
We are also required to review the Long-term viability statement,
set out on page 34, under the Listing Rules. Based on the above
procedures, we have concluded that the above disclosures are
materially consistent with the financial statements and our
audit knowledge.
Our work is limited to assessing these matters in the context of
only the knowledge acquired during our financial statements audit.
As we cannot predict all future events or conditions and as
subsequent events may result in outcomes that are inconsistent
with judgements that were reasonable at the time they were made,
the absence of anything to report on these statements is not a
guarantee as to the Group’s and Company’s longer-term viability.
Corporate governance disclosures
We are required to perform procedures to identify whether there is a
material inconsistency between the Directors’ corporate governance
disclosures and the financial statements and our audit knowledge.
Based on those procedures, we have concluded that each of the
following is materially consistent with the financial statements and
our audit knowledge:
• the Directors’ statement that they consider that the annual
report and financial statements taken as a whole is fair, balanced
and understandable, and provides the information necessary for
shareholders to assess the Group’s position and performance,
business model and strategy;
• the section of the annual report describing the work of the
Audit Committee, including the significant issues that the Audit
Committee considered in relation to the financial statements,
and how these issues were addressed; and
• the section of the annual report that describes the review of the
effectiveness of the Group’s risk management and internal
control systems.
We are required to review the part of the Corporate Governance
Statement relating to the Group’s compliance with the provisions
of the UK Corporate Governance Code specified by the Listing
Rules for our review.
We have nothing to report in this respect.
136
Ascential plc Annual Report 2023 8.
We have nothing to report on the other matters
on which we are required to report by exception
10.
The purpose of our audit work and to whom we
owe our responsibilities
This report is made solely to the Company’s members, as a body,
in accordance with Chapter 3 of Part 16 of the Companies Act
2006. Our audit work has been undertaken so that we might state
to the Company’s members those matters we are required to state
to them in an auditor’s report and for no other purpose. To the
fullest extent permitted by law, we do not accept or assume
responsibility to anyone other than the Company and the
Company’s members, as a body, for our audit work, for this report,
or for the opinions we have formed.
Christopher Hearn (Senior Statutory Auditor)
for and on behalf of KPMG LLP, Statutory Auditor
Chartered Accountants
15 Canada Square
London, E14 5GL
United Kingdom
25 March 2024
Under the Companies Act 2006, we are required to report to you
if, in our opinion:
• adequate accounting records have not been kept by the parent
Company, or returns adequate for our audit have not been
received from branches not visited by us; or
• the Parent Company financial statements and the part of the
Directors’ Remuneration Report to be audited are not in
agreement with the accounting records and returns; or
• certain disclosures of Directors’ remuneration specified by law
are not made; or
• we have not received all the information and explanations we
require for our audit.
We have nothing to report in these respects.
9. Respective responsibilities
Directors’ responsibilities
As explained more fully in their statement set out on page 128, the
Directors are responsible for: the preparation of the financial
statements including being satisfied that they give a true and fair
view; such internal control as they determine is necessary to
enable the preparation of financial statements that are free from
material misstatement, whether due to fraud or error; assessing
the Group and Parent Company’s ability to continue as a going
concern, disclosing, as applicable, matters related to going
concern; and using the going concern basis of accounting unless
they either intend to liquidate the Group or the Parent Company
or to cease operations, or have no realistic alternative but to do so.
Auditor’s responsibilities
Our objectives are to obtain reasonable assurance about whether
the financial statements as a whole are free from material
misstatement, whether due to fraud or error, and to issue our
opinion in an auditor’s report. Reasonable assurance is a high level
of assurance, but does not guarantee that an audit conducted in
accordance with ISAs (UK) will always detect a material
misstatement when it exists. Misstatements can arise from fraud
or error and are considered material if, individually or in aggregate,
they could reasonably be expected to influence the economic
decisions of users taken on the basis of the financial statements.
A fuller description of our responsibilities is provided on the FRC’s
website at www.frc.org.uk/auditorsresponsibilities.
The Company is required to include these financial statements in
an annual financial report prepared under Disclosure Guidance
and Transparency Rule 4.1.17R and 4.1.18R. This auditor’s report
provides no assurance over whether the annual financial report
has been prepared in accordance with that format.
137
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Financial statements
Consolidated Statement
of Profit or Loss
For the year ended 31 December 2023
(£ million)
Continuing operations
Revenue
Cost of sales
Sales, marketing and administrative expenses
Operating profit/(loss)
Adjusted EBITDA
Depreciation, amortisation and impairment
Non-trading items
Share-based payments
Operating profit/(loss)
Finance costs
Finance income
Profit/(loss) before taxation
Taxation (charge)/credit
Profit/(loss) from continuing operations
Discontinued operations
Profit/(loss) from discontinued operations, net of tax
11
Profit/(loss) for the year
Profit/(loss) attributable to:
Owners of the Company
Non-controlling interests (NCI)
Earnings/(loss) per share (Basic and Diluted, pence)
Continuing operations
– Basic EPS
– Diluted EPS
Continuing and discontinued operations
– Basic EPS
– Diluted EPS
* Restated for discontinued operations, refer to Note 11 for further detail.
14
12
12
12
12
2023
2022 (Restated)*
Note
Adjusted
results
Adjusting
items
Total
Adjusted
results
Adjusting
items
4
5
4
4
6
8
5
9
9
10
206.4
(74.2)
(80.7)
51.5
56.4
(4.9)
–
–
–
–
(20.8)
(20.8)
–
(9.0)
(4.4)
(7.4)
51.5
(20.8)
(26.6)
5.6
30.5
(8.1)
22.4
–
0.9
(19.9)
3.3
(16.6)
206.4
(74.2)
(101.5)
30.7
56.4
(13.9)
(4.4)
(7.4)
30.7
(26.6)
6.5
10.6
(4.8)
5.8
24.7
47.1
(220.2)
(236.8)
(195.5)
(189.7)
44.6
2.5
(235.9)
(0.9)
(191.3)
1.6
5.1
5.0
10.2
10.0
(3.8)
(3.7)
(53.8)
(52.9)
1.3
1.3
(43.6)
(42.9)
191.2
(65.3)
(80.6)
45.3
49.9
(4.6)
–
–
45.3
(8.2)
5.8
42.9
(10.9)
32.0
26.4
58.4
56.6
1.8
7.3
7.2
12.9
12.7
Total
191.2
(65.3)
(98.7)
27.2
49.9
(13.5)
(3.6)
(5.6)
27.2
(8.2)
5.8
24.8
(8.0)
16.8
–
–
(18.1)
(18.1)
–
(8.9)
(3.6)
(5.6)
(18.1)
–
–
(18.1)
2.9
(15.2)
(148.9)
(164.1)
(122.5)
(105.7)
(153.0)
(11.1)
(96.4)
(9.3)
(3.5)
(3.4)
(34.8)
(34.3)
3.8
3.8
(21.9)
(21.6)
The accompanying notes on pages 143 to 186 are an integral part of these consolidated financial statements. Adjusting items are detailed
in Note 6.
138
Ascential plc Annual Report 2023 Consolidated Statement of
Comprehensive Income
For the year ended 31 December 2023
(£ million)
Profit/(loss) for the year from:
Continuing operations
Discontinued operations
Profit/(loss) for the year
Other Comprehensive income
Items that have been or may be reclassified subsequently
to profit or loss (net of tax):
Exchange translation differences recognised in equity on
translation of foreign operations
Gain on net investment hedge
Other comprehensive income, net of tax
2023
2022 (Restated)*
Adjusted
results
Adjusting
items
Total
Adjusted
results
Adjusting
items
22.4
24.7
47.1
(16.6)
(220.2)
(236.8)
5.8
(195.5)
(189.7)
32.0
26.4
58.4
(15.2)
(148.9)
(164.1)
Total
16.8
(122.5)
(105.7)
(28.8)
–
(28.8)
–
4.6
4.6
(28.8)
4.6
(24.2)
40.2
–
40.2
–
–
–
40.2
–
40.2
Total comprehensive income/(expense) for the year, net of tax
18.3
(232.2)
(213.9)
98.6
(164.1)
(65.5)
Total comprehensive income/(expense) attributable to:
Owners of the Company
Non-controlling interests
* Restated for discontinued operations, refer to Note 11 for further detail.
15.8
2.5
(231.3)
(0.9)
(215.5)
1.6
96.8
1.8
(153.0)
(11.1)
(56.2)
(9.3)
The accompanying notes on pages 143 to 186 are an integral part of these consolidated financial statements.
139
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Financial statements continued
Consolidated Statement
of Financial Position
As at 31 December 2023
(£ million)
Assets
Non-current assets
Goodwill
Intangible assets
Property, plant and equipment
Right-of-use assets
Investments
Other receivables
Deferred tax assets
Current assets
Inventories
Trade and other receivables
Derivatives
Cash and cash equivalents
Assets held for sale
Total assets
Liabilities
Current liabilities
Trade and other payables
Deferred income
Deferred and contingent consideration
Lease liabilities
Current tax liabilities
Provisions
Liabilities held for sale
Non-current liabilities
Deferred income
Deferred and contingent consideration
Lease liabilities
External borrowings
Deferred tax liabilities
Provisions
Total liabilities
Net assets
Equity
Share capital
Share premium
Translation reserve
Other reserves
Retained earnings
Shareholders’ equity
Non-controlling interests
Total equity
Total liabilities and equity
Note
2023
2022
16
16
17
27
18
19
10
19
29
22
11
20
21
27
10
23
11
21
27
22
10
23
24
24
24
14
134.8
69.6
0.6
5.9
1.7
–
92.2
304.8
0.3
49.2
7.0
39.4
1,205.6
1,301.5
1,606.3
80.5
54.1
65.7
2.0
5.2
5.4
413.9
626.8
–
–
8.9
411.6
7.6
1.9
430.0
1,056.8
549.5
4.4
154.1
(4.5)
165.8
209.7
529.5
20.0
549.5
711.1
242.4
5.7
20.7
88.5
42.7
60.3
1,171.4
3.3
344.9
4.5
80.0
–
432.7
1,604.1
277.6
116.3
43.2
7.3
8.6
2.0
–
455.0
1.0
64.9
19.5
301.2
8.6
2.0
397.2
852.2
751.9
4.4
153.6
19.7
166.0
386.5
730.2
21.7
751.9
1,606.3
1,604.1
The accompanying notes on pages 143 to 186 are an integral part of these consolidated financial statements.
The consolidated financial statements on pages 138 to 142 were approved by the Board of Directors on 25 March 2024 and were signed
on its behalf by Directors:
Philip Thomas and Mandy Gradden.
Company number: 09934451
140
Ascential plc Annual Report 2023 Consolidated Statement
of Changes in Equity
For the year ended 31 December 2023
(£ million)
At 1 January 2022
Loss for the year
Other comprehensive income
Total comprehensive income
Issue of shares
Share purchases
Shares issued to employees
Foreign exchange movements
Share-based payments
Taxation on share-based payments
Dividends paid to non-controlling interest
At 31 December 2022
Loss for the year
Other comprehensive (expense)/income
Total comprehensive (expense)/income
Issue of shares
Share purchases
Shares issued to employees
Foreign exchange movements
Share-based payments
Taxation on share-based payments
Acquisition of non-controlling interests
Dividends paid to non-controlling interest
Share
capital
Share
premium
Translation
reserve
Other
reserves
Retained
earnings
Shareholders’
equity
Non-
controlling
interests
4.4
153.3
(20.5)
167.0
–
–
–
–
–
–
–
–
–
–
–
–
–
0.3
–
–
–
–
–
–
4.4
153.6
–
–
–
–
–
–
–
–
–
–
–
–
–
–
0.5
–
–
–
–
–
–
–
–
40.2
40.2
–
–
–
–
–
–
–
19.7
–
(24.2)
(24.2)
–
–
–
–
–
–
–
–
–
–
–
–
(3.7)
2.7
–
–
–
–
166.0
–
–
–
–
(6.7)
6.5
–
–
–
–
–
471.7
(96.4)
–
(96.4)
–
–
(2.7)
–
16.7
(2.8)
–
386.5
(191.3)
–
(191.3)
–
–
(6.5)
–
22.8
(1.8)
–
–
775.9
(96.4)
40.2
(56.2)
0.3
(3.7)
–
–
16.7
(2.8)
–
730.2
(191.3)
(24.2)
(215.5)
0.5
(6.7)
–
–
22.8
(1.8)
–
–
29.7
(9.3)
–
(9.3)
–
–
–
3.4
–
–
(2.1)
21.7
1.6
–
1.6
–
–
–
(1.2)
–
–
0.1
(2.2)
20.0
At 31 December 2023
4.4
154.1
(4.5)
165.8
209.7
529.5
The accompanying notes on pages 143 to 186 are an integral part of these consolidated financial statements.
Total
equity
805.6
(105.7)
40.2
(65.5)
0.3
(3.7)
–
3.4
16.7
(2.8)
(2.1)
751.9
(189.7)
(24.2)
(213.9)
0.5
(6.7)
–
(1.2)
22.8
(1.8)
0.1
(2.2)
549.5
141
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Note
2023 2022 (Restated)*
Financial statements continued
Consolidated Statement
of Cash Flows
For the year ended 31 December 2023
(£ million)
Cash flow from operating activities
Profit before taxation from continuing operations
Loss before taxation from discontinued operations
Loss before tax
Adjustments for:
Depreciation and amortisation
Impairment of assets
Deferred contingent consideration
Loss/(gain) on disposal of businesses
Loss on disposal of intangible assets and property, plant and equipment
Share-based payments
Share of the loss of equity-accounted investees, net of tax
Net finance costs
Cash generated from operations before changes in working capital, provisions and deferred
and contingent consideration
Deferred and contingent consideration paid
Changes in:
Inventories
Trade and other receivables
Trade and other payables
Provisions
Cash (used in)/generated from operations
Adjusted cash generated from operations
Cash inflows for discontinued operations
Cash outflows for acquisition-related contingent employment costs**
Cash outflows for other Non-trading items
Cash (used in)/generated from operations
Tax paid
Net cash (used in)/generated from operating activities
Cash flow from investing activities
Acquisition of subsidiaries, net of cash acquired
Deferred and contingent consideration paid**
Acquisition of investments
Proceeds from sale of equity-accounted investments
Loan to associate
Acquisition of software intangibles and property, plant and equipment
Disposal of businesses, net of cash disposed
Net cash used in investing activities
Cash flow from financing activities
Proceeds from external borrowings
Repayment of external borrowings
Proceeds from issue of shares
Share repurchase
Net interest and arrangement fees paid
Net lease liabilities paid
Dividends paid to non-controlling interests
Net cash generated from financing activities
Net increase/(decrease) in cash and cash equivalents
Cash and cash equivalents at 1 January
Effect of exchange rate changes
Cash and cash equivalents (including cash held in disposal groups) at 31 December
Cash and cash equivalents held in disposal group presented as held for sale at 31 December
Cash and cash equivalents at 31 December
11
16, 17, 27
16, 27
21
8
18
21
21
13
21
18
18
22
22
10.6
(230.2)
(219.6)
49.8
12.8
(1.8)
0.1
0.6
23.8
13.3
132.7
11.7
(42.5)
(4.5)
(67.5)
94.0
4.9
(3.9)
62.9
42.1
(42.5)
(66.4)
(3.9)
(4.3)
(8.2)
(6.8)
(27.1)
(3.6)
24.9
(19.5)
(41.2)
–
(73.3)
170.1
(47.5)
0.5
(5.7)
(15.7)
(8.1)
(2.2)
91.4
9.9
80.0
(3.4)
86.5
47.1
39.4
* Restated for discontinued operations, refer to Note 11 for further detail.
** Includes payments for both deferred and contingent consideration recognised on initial acquisition as well as any subsequent remeasurements. Payments linked to ongoing
employment in addition to business performance are shown within cash generated from operations.
The accompanying notes on pages 143 to 186 are an integral part of these consolidated financial statements.
24.8
(141.8)
(117.0)
60.3
59.9
31.5
(6.0)
–
15.9
3.2
18.7
66.5
(19.5)
(1.2)
(50.7)
58.2
0.1
53.4
56.9
68.3
(19.5)
(52.3)
53.4
(0.2)
53.2
(60.8)
(37.9)
(4.0)
5.3
(30.6)
(35.9)
0.6
(163.3)
176.8
(53.8)
0.3
(3.7)
(9.0)
(7.3)
(2.8)
100.5
(9.6)
84.1
5.5
80.0
–
80.0
142
Ascential plc Annual Report 2023 Notes to the Consolidated
Financial Statements
For the year ended 31 December 2023
1. Basis of preparation
These consolidated financial statements of Ascential plc (the
“Company”) and its subsidiaries (the “Group”) have been prepared
in accordance with Companies Act 2006 and UK-adopted
international accounting standards (“UK-adopted IFRS”).
Ascential plc is a public company, which is listed on the London
Stock Exchange, registered in England and Wales, incorporated
and domiciled in the United Kingdom. The registered office is
located at 2nd Floor, 81-87 High Holborn, London WC1V 6DF. The
Company is principally engaged in the provision of industry-
specific events, intelligence and advisory services. The principal
activities in the year were information services for digital
commerce, product design, marketing, and retail & financial
services. Following the disposal of the Digital Commerce and
Product Design businesses in early 2024 (see Note 11), the principal
activities are events, intelligence and advisory services for the
Marketing and Financial Technology industries.
The consolidated financial statements are presented in Pounds
Sterling (“GBP”), which is the Company’s functional currency, and
have been rounded to millions to the nearest one decimal place
except where otherwise indicated.
The consolidated financial statements have been prepared on a
going concern basis (see further details below) and under the
historical cost convention, with the exception of items that are
required by IFRS to be measured at fair value.
Going concern
After considering the current financial projections and the bank
facilities available and then applying a severe but plausible
sensitivity, the Directors of the Company are satisfied that the
Group has sufficient resources for its operational needs and will
remain in compliance with the financial covenants in its bank
facilities for at least the next 12 months from the date of approving
these financial statements. The process and key judgements in
coming to this conclusion are set out below.
The Board is required to assess going concern at each reporting
period. These assessments require judgement to determine the
impact of future economic conditions on the Group, including the
impact of any downward recessionary pressures. The Directors
have considered three main factors in reaching their conclusions
on going concern – liquidity, covenants and scenario planning – as
set out below.
Liquidity
In December 2023, the Group entered into a new four-year
multi-currency revolving credit facility (“RCF”) of £225m with an
accordion of up to a further £75m or 100% of EBITDA. The RCF
became effective on completion of the Digital Commerce
disposal in January 2024. These facilities provide ample liquidity
when judged against the operational requirements of the
continuing Group following the disposals of Digital Commerce
and WGSN.
Covenants
The more sensitive aspects of the Group’s financing are the
application of certain covenant limit tests to these facilities and
the most sensitive covenant limit is Net Debt Leverage (broadly,
the ratio of Net Debt to Adjusted pre-IFRS 16 EBITDA). The facility
covenants are tested semi-annually and include (i) a maximum Net
Debt leverage of 3.00x and, (ii) a minimum interest cover of 3.00x.
The first covenant testing period under the new RCF will be 30
June 2024.
Scenario planning
In assessing going concern, the Directors considered the most
severe but plausible scenario that could impact the business to
be the cancellation of a major event at short notice in conjunction
with the closure of Hudson if no sale is concluded. This scenario is
not a forecast of the Group and is designed to stress test liquidity
and covenant compliance. The key assumption of this scenario is
that Cannes Lions is cancelled in June 2024 with minimal notice
due to an unforeseen event and only a smaller version of the
in-person event can be rescheduled for later in 2024. Furthermore,
this downside scenario assumes that the ongoing sale process for
Hudson does not complete successfully and incremental costs are
incurred to close the operations. This scenario results in a 2.0x
increase to our leverage ratio at the 31 December 2024 testing
point but remains within the covenant limits.
In their review of the downside scenario, the Directors have also
considered a number of mitigations that would reduce the
leverage ratio and are at their discretion, including but not limited
to cost savings and the postponement of any dividend payments.
In this downside scenario there is sufficient headroom against
all banking covenant tests. Accordingly, the Directors continue
to adopt the going concern basis for the preparation of the
financial statements.
143
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 2. Accounting policies
The principal accounting policies in the preparation of the
consolidated financial statements have been applied consistently
to both periods presented.
Basis of consolidation
The consolidated financial statements comprise the financial
statements of the parent Company, its subsidiaries and share of
the results of its associates and joint ventures drawn up to 31
December 2023 using consistent accounting policies throughout
the current and preceding years.
The trading results of business operations are included in profit or
loss from continuing operations from the date of acquisition on
which control was obtained or up to the date of disposal.
Intra-group balances and transactions are eliminated in full on
consolidation. Control is achieved when the Group is exposed, or
has rights, to variable returns from its involvement with the
investee and has the ability to affect those returns through its
power over the investee.
Climate change
In preparing the financial statements management has considered
the impact on climate change, specifically with reference to
disclosures in the strategic report and sustainability strategy. These
factors have not had a significant effect on the Group’s accounting
estimate and judgements with respect to the current year.
Foreign currency translation
The functional currency of subsidiaries and associates is the
currency of the primary economic environment in which they
operate. The consolidated financial statements are presented in
Pounds Sterling, which is the presentational currency of the Group
and the functional currency of the parent Company.
Foreign currency transactions are recorded at the exchange rate
ruling at the date of transaction. Foreign currency monetary assets
and liabilities are translated at the rates of exchange ruling at the
reporting date. All differences are taken to the consolidated
statement of profit or loss except for those on foreign currency
borrowings that provide a hedge against an investment in a foreign
entity. These are taken directly to equity until the disposal of the
investment, at which time a cumulative amount is recognised in
the consolidated statement of profit or loss. Tax charges and
credits attributable to exchange differences on those borrowings
are also dealt with in equity. Non-monetary items that are
measured at historical cost in a foreign currency are translated
using the exchange rate in force at the date of the initial
transaction. Non-monetary items measured at fair value in a
foreign currency are translated using the exchange rates at the
date when the fair value is determined. The gain or loss arising on
translation of non-monetary items measured at fair value is treated
in line with the recognition of the gain or loss on the change in fair
value of the item (i.e. translation differences on items whose fair
value gain or loss is recognised in other comprehensive income or
profit or loss are also recognised in other comprehensive income
or profit or loss, respectively).
As at the reporting date, the assets and liabilities of overseas
subsidiaries are translated into Pounds Sterling at the rate of
exchange applicable at the reporting date and their consolidated
statement of profit or loss are translated at the monthly average
exchange rates for the period. The exchange differences arising
from the retranslation of foreign operations are taken directly to a
separate component of equity. On disposal of a foreign operation,
the cumulative amount recognised in equity relating to that
operation is recognised in the consolidated statement of profit or
loss as part of the gain or loss on sale. Goodwill and fair value
adjustments arising on the acquisition of a foreign entity are
treated as assets and liabilities of the foreign entity and translated
at the closing rate at the reporting date.
Changes in fair value of derivative financial instruments entered
into to hedge foreign currency net assets, and that satisfy the
hedging conditions of IFRS 9 “Financial Instruments”, are
recognised in the currency translation reserve.
Discontinued operations
The Group classifies an operation as discontinued when it has
disposed of or intends to dispose of a business component that
represents a separate major line of business or geographical area
of operations. The post-tax profit or loss of the discontinued
operations is shown as a single line on the face of the consolidated
statement of profit or loss, separate from the continuing operating
results of the Group. When an operation is classified as a
discontinued operation, the comparative consolidated statement
of profit or loss is represented as if the operation had been
discontinued from the start of the comparative year. Expenses are
presented as discontinued if they will cease to be incurred on
disposal of the discontinued operation.
Assets and liabilities held for sale
Where the Group expects to recover the carrying amount of a group
of assets through a sale transaction rather than through continuing
use, and a sale is considered to be highly probable at the reporting
date, the assets are classified as held for sale and measured at the
lower of cost and fair value less costs to sell. No depreciation or
amortisation is charged in respect of non-current assets classified
as held for sale once the classification has been made.
Revenue
Revenue is measured based on the consideration specified in a
contract with a customer. If multiple performance obligations exist
within a contract, the revenue is allocated to the obligations based
on the standalone selling price, with any discounts allocated
accordingly across the obligations. For contracts with rebates and
therefore variable consideration, revenue is recognised based on
the best estimate of the revenue net of the rebated amount.
Revenue is recognised when the Group satisfies the performance
obligations, the timing of which is set out in Note 4.
Digital Subscriptions & Platforms revenue is generally recognised
systematically over the period the services are provided as the
customer simultaneously receives and consumes the economic
benefit of the service. Advisory revenue is recognised over time
where we have the right to payment for performance completed
to date. Revenue is recognised based on an input method of
measurement using either internal timesheets as the
measurement of the level of time worked as a percentage of the
total expected time worked on the contract as this is
commensurate with the pattern of transfer of service to the
customer, or other appropriate cost measures.
144
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued The Group provided services arising from the purchase of media,
arranged on behalf of customers, through its technology platforms.
In most of these cases, we were acting as an agent as we did not
control the relevant services before it was transferred to the client
and no revenue, or cost, was recognised for the pass-through
whereby the Group purchased media and charged clients.
Events and benchmarking awards revenue is recognised at the
point in time that the relevant events and awards take place.
Pre-paid subscription and event revenues are shown as deferred
income and released to the income statement in accordance with
the revenue recognition criteria above. There is no significant
financing component for these contracts considering the length
of time between the customers’ payment and the satisfaction of
the respective performance obligation.
Transactional revenue is recognised when control of the product is
passed to the customer. For such sales, this generally occurs when
the product is delivered to the customer, depending on
contractual conditions.
Barter transactions are those where goods and services,
rather than cash, are exchanged between two third parties
and revenue is recognised at fair value for the goods or services
provided. Where goods or services are provided at a discount and
dissimilar to the goods or services received, the discounted price
is recorded as revenue with the corresponding amount included
in operating costs.
Alternative Performance Measures
The consolidated financial statements include Alternative
Performance Measures, including Adjusted EBITDA, as an
additional measure of profitability of the trading performance of
the continuing operations of the Group. Adjusted EBITDA is a
non-IFRS measure, defined as the Group’s operating profit before
expensing depreciation of tangible fixed assets and amortisation
of software, Non-trading items, amortisation of acquired intangible
assets, impairment of tangible fixed assets and software
intangibles, share-based payments and one-off finance costs.
Refer to pages 195 to 198 for further details on Alternative
Performance Measures.
Non-trading items
Non-trading items are those which meet the Group’s policy for
those costs which are considered significant or unusual by virtue
of their nature, size or incidence; or directly incurred as a result of
either an acquisition, divestiture or relate to a major business
change or restructuring programme. The presentation and policy
are applied consistently year on year with items presented
separately within their relevant income statement category to
assist in the understanding of the performance and financial
results of the Group.
Examples of items that are considered by the Directors for
designation as Non-trading items include, but are not limited to:
• significant capital structuring costs as these can be material and
are not a reflection of the underlying business;
• costs incurred as part of the acquisition and integration of
acquired businesses as these can be material. Acquisition-related
employment costs, which, absent the link to continued
employment, would have been treated as consideration are
designated as Non-trading items (revenues related to acquisitions
are recorded within the Adjusted results of the Group);
• gains or losses on disposals of businesses are considered to be
non-trading in nature as these do not reflect the performance of
the Group;
• material restructuring and separation costs within a segment
incurred as part of a significant change in strategy as these are
not expected to be repeated on a regular basis; and
• significant one-off items, such as the impairment of intangible
assets, the recognition of provisions for onerous contracts and
substantial system implementations, that do not reflect
underlying performance.
If provisions have been made for Non-trading items in previous
years, then any reversal of these provisions is treated within
Non-trading items.
Finance costs and income
Finance cost or income is recognised using the effective interest
method. The effective interest rate is the rate that discounts
estimated future cash payments or receipts through the expected
life of the financial instrument to the gross carrying amount of the
financial asset, or the amortised cost of the financial liability.
Income tax
The Group is primarily subject to corporation tax in the UK, the US
and China.
Income tax on the profit or loss for the period comprises current tax
and deferred tax. Income tax is recognised in the consolidated
statement of profit or loss, except to the extent that it relates to items
recognised directly in equity, in which case it is recognised in equity.
Current tax is tax payable based on taxable profits for the period,
using tax rates that have been enacted or substantively enacted at
the reporting date in the countries where the Group operates and
generates taxable income, along with any adjustment relating to
tax payable in previous years. Taxable profit differs from net profit
in the consolidated statement of profit or loss in that income or
expense items that are taxable or deductible in other years are
excluded, as are items that are never taxable or deductible.
Using the liability method, deferred tax is provided on temporary
differences at the reporting date between the tax bases of assets
and liabilities and their carrying amounts for financial reporting
purposes, except for certain temporary differences, such as
goodwill that is not deductible for tax purposes.
145
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 2. Accounting policies continued
Deferred tax assets and liabilities are measured at the tax rates that
are expected to apply to the year in which the asset is realised or the
liability is settled, based on tax rates that have been enacted or
substantively enacted at the reporting date. Deferred tax assets are
recognised to the extent that is probable that taxable profit will be
available against the deductible temporary differences, and the carry
forward of unused tax credits and tax losses can be utilised, except:
• when the deferred tax asset relating to the deductible
temporary difference arises from the initial recognition of an
asset or liability in a transaction that is not a business
combination and, at the time of the transaction, affects neither
the accounting profit nor taxable profit or loss; and
•
in respect of deductible temporary differences associated with
investments in subsidiaries and associates, deferred tax assets
are recognised only to the extent that it is probable that the
temporary differences will reverse in the foreseeable future and
that taxable profit will be available against which the temporary
differences can be utilised.
re-measured at the acquisition date through the consolidated
statement of profit or loss. Transaction costs are expensed to the
consolidated statement of profit or loss as incurred.
Acquisition-related expenses include contingent consideration
payments agreed as part of the acquisition and contractually
linked to ongoing employment as well as business performance
(acquisition-related employment costs). Acquisition-related
employment costs are accrued over the period in which the
related services are received and are recorded as Non-trading
items and accounted for in accordance with IAS 19 ‘Employee
Benefits’. We have made a judgement that payments related to
this type of contingent consideration are reported within operating
activities within the consolidated statement of cash flows and
other consideration payments are reported within investing
activities in line with how management consider these payments.
The non-controlling interest at acquisition date is measured either
at fair value or the non-controlling interest’s share of the
identifiable assets purchased and liabilities assumed. This election
is made on an individual transaction basis.
The carrying amount of deferred tax assets is reviewed at each
reporting date and reduced to the extent that it is no longer
probable that sufficient taxable profit will be available to allow all or
part of the deferred tax asset to be utilised. Unrecognised deferred
tax assets are reassessed at each reporting date and are
recognised to the extent that it has become probable that future
taxable profits will allow the deferred tax asset to be recovered.
Intangible assets
Goodwill
Goodwill arises where the fair value of the consideration given
for a business exceeds the fair value of net identifiable assets of
the business at the date of acquisition. Goodwill is allocated or
grouped at the lowest levels, for which there are identifiable cash
flows, known as cash generating units or CGUs.
In assessing the recoverability of deferred tax assets, the Group
relies on the same forecast assumptions used elsewhere in the
financial statements and in other management reports.
The deferred tax assets and liabilities are only offset where they relate
to the same taxing authority and the Group has a legal right to offset.
Business combinations
The fair value of consideration paid for a business combination is
measured as the aggregate of the fair values at the date of
exchange of assets given and liabilities incurred or assumed in
exchange for control. The assets, liabilities and contingent liabilities
of the acquired entity are measured at fair value as at the acquisition
date. When the initial accounting for a business combination is
determined, it is done so on a provisional basis with any
adjustments to these provisional values made within 12 months of
the acquisition date and are effective as at the acquisition date. To
the extent that deferred consideration is payable as part of the
acquisition cost and is payable after one year from the acquisition
date, the deferred consideration is discounted at an appropriate
interest rate and, accordingly, carried at fair value in the
consolidated statement of financial position and accounted for in
accordance with IFRS 9 ‘Financial Instruments’. The discounting is
then recognised in the consolidated statement of profit or loss over
the life of the obligation. Where a business combination agreement
provides for an adjustment to the cost of a business acquired
contingent on future events, the Group accrues the fair value of the
additional consideration payable as a liability at acquisition date. This
amount is reassessed at each subsequent reporting date with any
adjustments recognised in the consolidated statement of profit or
loss. If the business combination is achieved in stages, the fair value
of the acquirer’s previously held equity interest in the acquiree is
Goodwill arising on acquisition is capitalised and subject to
impairment review, both annually and when there are indications
that the carrying value may not be recoverable. For goodwill
impairment purposes, no CGU is larger than the reporting
segments determined in accordance with IFRS 8 “Operating
Segments”. The recoverable amount of goodwill is assessed on
the basis of the value-in-use estimate for CGUs to which the
goodwill relates. In assessing value in use, the estimated future
cash flows are discounted to their present value using a pre-tax
discount rate that reflects current market assessments of the time
value of money and the risks specific to the asset.
Where the carrying value exceeds the recoverable amount the
goodwill is considered impaired and written down to its
recoverable amount. Any impairment is recognised in the
consolidated statement of profit or loss.
Other intangibles
Intangible assets other than goodwill are those that are distinct
and can be sold separately or arise from legal rights. Intangible
assets acquired as part of a business combination are capitalised
at fair value at the date of acquisition. Intangible assets purchased
separately are capitalised at cost.
The cost of intangible assets is amortised and charged to the
consolidated statement of profit or loss on a straight-line basis over
their estimated useful lives as follows:
Brands
Customer relationships
Technology
Software & content
5-20 years
5-12 years
5-10 years
2-5 years
146
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued
Useful lives are examined every year and adjustments are made,
where applicable, on a prospective basis.
Website development costs relating to websites we control and
which are revenue generating are capitalised when they meet the
intangible asset recognition criteria and amortised over two to five
years. Development costs relating to websites which are not revenue
generating are taken immediately to the consolidated statement of
profit or loss. Other operating expenses related to website
functioning such as selling, administrative and other general
overhead expenditure are recognised as an expense as incurred.
Where no internally generated intangible asset can be recognised,
development expenditure is charged to the consolidated
statement of profit or loss in the period in which it is incurred.
The Group only capitalises internally generated costs from the
configuration and capitalisation of software as a service (“SaaS”)
projects when it is able to obtain economic benefits from the
activities independent from the SaaS solution itself.
Impairment reviews
Goodwill and acquired intangible assets with an indefinite life are
allocated to cash-generating units and tested for impairment at least
annually or when there is an indicator that the asset may be impaired.
Finite life intangible assets are assessed for impairment triggers and
where an indicator exists a test for impairment is performed. The
Group bases its impairment calculation on most recent budgets and
forecast calculations, which are prepared separately for each of the
Group’s CGUs to which the individual assets are allocated. These
budgets and forecast calculations generally cover a period of five
years. A long-term growth rate is calculated and applied to project
future cash flows after the terminal year.
Impairment losses are recognised in the statement of profit or loss
in expense categories consistent with the function of the impaired
asset. Previously recognised impairment losses are only reversed if
there has been a change in the assumptions used to determine
the asset’s recoverable amount since the last impairment loss was
recognised. The reversal must not exceed the carrying amount,
net of depreciation, had no impairment loss been recognised for
the asset in prior years.
Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated
depreciation and accumulated impairment losses. Cost comprises
expenditure directly attributable to the purchase of the asset.
Assets are depreciated to their estimated residual value, on a
straight-line basis, over their estimated useful life as follows:
Short leasehold property
over the period of the lease
Hardware, fixtures & fittings 2-5 years
Estimated useful lives and residual values are reviewed at each
reporting date. An item of property, plant or equipment is written
off either on disposal or when there is no expected future
economic benefit from its continued use. Any gain or loss on
derecognition of the asset (calculated as the difference between
the net disposal proceeds and the carrying value of the asset) is
included in the consolidated statement of profit or loss in the year
the item is derecognised.
Share-based payments
Certain employees of the Group receive part of their remuneration
in the form of share-based payment transactions, whereby
employees render services in exchange for shares or rights over
shares. The cost of equity-settled transactions with employees is
measured at fair value at the date at which they are granted. The
fair value of share awards with market-related vesting conditions is
determined by an external consultant and the fair value at the grant
date is expensed on a straight-line basis over the vesting period
based on the Group’s estimate of shares that will eventually vest.
The estimate of the number of awards likely to vest is reviewed
at each reporting date up to the vesting date, at which point the
estimate is adjusted to reflect the actual outcome of awards which
have vested. No adjustment is made to the fair value after the
vesting date even if the awards are forfeited or not exercised.
Shares held by the Employee Benefit Trust
The Employee Benefit Trust (“EBT”) provides for the issue of shares
to Group employees under share incentive schemes. The
Company controls the EBT and accounts for the EBT as an
extension to the Company in the consolidated financial
statements. Accordingly, shares in the Company held by the EBT
are included in the consolidated statement of financial position at
cost as a deduction from equity.
Financial instruments
Derivative financial instruments and hedge accounting
The Group uses derivative financial instruments, such as forward
contracts to hedge its foreign currency risks and interest rate risks,
respectively. Such derivative financial instruments are initially
recognised at fair value on the date on which a derivative contract
is entered into and are subsequently re-measured at fair value.
Derivatives are carried as financial assets when the fair value is
positive and as financial liabilities when the fair value is negative.
For the purpose of hedge accounting, hedges are classified as:
• Fair value hedges when hedging the exposure to changes in the
fair value of a recognised asset or liability or an unrecognised
firm commitment
• Cash flow hedges when hedging the exposure to variability in
cash flows that is either attributable to a particular risk
associated with a recognised asset or liability or a highly
probable forecast transaction or the foreign currency risk in an
unrecognised firm commitment
• Hedges of a net investment in a foreign operation
• At the inception of a hedge relationship, the Group formally
designates and documents the hedge relationship to which it
wishes to apply hedge accounting and the risk management
objective and strategy for undertaking the hedge.
Net investment hedging
The effective portion of the gain or loss on the hedging
instrument is recognised in other comprehensive income in the
net investment hedge reserve, while any ineffective portion is
recognised immediately in the statement of profit or loss. The
Group discontinues hedge accounting when a hedging
instrument expires or no longer qualifies for hedge accounting.
Gains or losses on hedging instruments relating to an underlying
exposure that no longer exists are taken to the income statement.
147
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 2. Accounting policies continued
Trade investments
Investments in equity instruments are measured at fair value
through profit or loss unless or until such time as the Group is
deemed to have significant influence or control over the investee,
or they are derecognised. When significant influence is obtained,
the Group determines its investment in the equity-accounted
associate using the fair value approach. Accordingly, the initial
valuation includes the sum of the fair value of the initial interest at
the date of obtaining significant influence plus the consideration
paid for any additional interest.
Trade and other receivables
Trade receivables are recognised initially at fair value and
subsequently measured at amortised cost, less loss allowances. Loss
allowances are calculated for lifetime-expected credit losses.
Expected credit losses are a probability weighted estimate of credit
losses and are calculated based on actual historical credit losses
over the past three years and adjusted to reflect differences
between the historical credit losses and the Group’s view of the
economic conditions over the expected lives of the receivables.
The amount of the loss is recognised in the consolidated statement
of profit or loss. When a trade receivable is uncollectible, it is written
off against the allowance account for trade receivables. Subsequent
recoveries of amounts previously written off are credited to the
consolidated statement of profit or loss.
Other receivables include amounts due from Digital Commerce
customers for pass-through costs principally in relation to the
purchase of media on their behalf. These costs comprise amounts
paid to external suppliers which are charged directly to clients.
The amounts due to external suppliers in these relationships are
recognised in other payables.
The Group undertakes the sale of trade receivables, without
recourse, to banks to manage the working capital impact of
media reimbursables in the Digital Commerce business. Sold trade
receivables are derecognised in the consolidated statement of
financial position when substantially all of the risks and rewards
associated with the assigned receivables are transferred to the bank.
Borrowings
Borrowings are recognised initially at fair value, net of transaction
costs incurred. Borrowings are subsequently stated at amortised
cost; any difference between the proceeds (net of transaction
costs) and the redemption value is recognised in the consolidated
statement of profit or loss over the period of the borrowings using
the effective interest method.
Cash and cash equivalents
Cash and cash equivalents include cash, cash in transit, short-term
deposits and other short-term highly liquid investments with an
original maturity of three months or less. For the purpose of the
consolidated cash flow statement, cash and cash equivalents are
as defined, net of outstanding bank overdrafts.
Investments in associates
Associates are those entities in which the Group has significant
influence, but not control or joint control, over the financial and
operating policies.
Interests in associates are accounted for using the equity method.
They are initially recognised at cost, which includes transaction
costs. Subsequent to initial recognition, the consolidated financial
statements include the Group’s share of the profit or loss and
other comprehensive income of equity-accounted investees, and
the results are updated to align the accounting policies with the
Group. Where the Group’s share of losses in an associate exceeds
its net investment, the Group ceases to recognise further losses
unless an obligation exists for the Group to fund those losses.
Inventories
Inventories are stated at the lower of cost or net realisable value.
Cost represents purchase cost net of rebates, including attributable
overheads, and is determined using either a weighted average cost
method or a first-in, first-out method. Net realisable value is the
estimated selling price in the ordinary course of business, less
estimated costs of completion and costs necessary to make the sale.
Provisions
Provisions are recognised when the Group has a present legal
or constructive obligation as a result of a past event, when it is
probable that an outflow of resources will be required to settle
the obligation and when a reliable estimate can be made of the
amount of the obligation. Where the Group expects some or all
of a provision to be reimbursed, the reimbursement is recognised
only when it is virtually certain. The expense relating to any
provision is presented in the consolidated statement of profit or
loss net of any reimbursement. If the time value of money has a
material effect on quantifying the provision, the provision is
determined by discounting the expected future cash flows at a
pre-tax rate that reflects current market assessments of the time
value of money and, where appropriate, the risks specific to the
liability. Where discounting is used, the increase in the provision
due to the passage of time is recognised as a finance charge.
A provision for restructuring is recognised when the Group has
approved a detailed and formal restructuring plan and the
restructuring either has commenced or has been announced
publicly. Future operating losses are not provided for.
Leases
Definition of a lease
At inception of a contract, the Group assesses whether a contract
is, or contains, a lease. A contract is, or contains, a lease if the
contract conveys a right to control the use of an identified asset
for a period of time in exchange for consideration.
As a lessee
The Group leases commercial office space and photocopiers.
The Group has elected not to recognise right-of-use assets and
lease liabilities for some leases of low-value assets (including
photocopiers). The Group recognises the lease payments
associated with these leases as an expense on a straight-line basis
over the lease term.
148
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued The Group recognises a right-of-use asset and lease liability at the
lease commencement date. The right-of-use asset is initially
measured at cost, and subsequently at cost less any accumulated
depreciation, which is recorded using the straight-line method from
the commencement date to the end of the lease term, and
impairment losses and adjusted for certain remeasurements of the
lease liability. Right-of-use assets are impaired when there is no
expected future economic benefit from its continued use due to
the property being vacant, or where the anticipated sublease
income is less than the contractual lease payments. The lease
liability is initially measured at the present value of the lease
payments that are not paid at the commencement date,
discounted using the Group’s incremental borrowing rate. The lease
liability is subsequently increased by the interest cost on the lease
liability and decreased by lease payments made. It is remeasured
when there is a change in future lease payments arising from a
change in an index or rate, a change in the estimate of the amount
expected to be payable under a residual value guarantee, or as
appropriate, changes in the assessment of whether a purchase or
extension option is reasonably certain to be exercised or a
termination option is reasonably certain not to be exercised.
The Group has applied judgement to determine the lease term for
some lease contracts that include renewal options. The assessment
of whether the Group is reasonably certain to exercise such options
impacts the lease term, which significantly affects the amount of
lease liabilities and right-of-use assets recognised. The Group has
applied the exemption not to recognise right-of-use assets and
liabilities for leases with less than 12 months of lease term.
As a lessor
The Group sub-leases certain of its properties. The right-of-use
assets recognised from the head lease are presented in investment
property and measured at fair value. The sub-lease contracts are
classified as operating leases under IFRS 16 “Leases”. No
depreciation is recognised for the right-of-use assets that meet the
definition of investment property.
New and amended accounting standards effective
during the year
The amended standards and interpretations to IFRS effective
during the year have not had a significant impact on the Group’s
accounting policies or reporting.
New and amended accounting standards that have
been issued but are not yet effective
The Group has early adopted Amendments to IAS 1 Classification
of Liabilities as Current or Non-current. A number of other new or
amended standards and interpretations are applicable in future
periods but are not expected to have a significant impact on the
Group’s accounting policies or reporting.
3. Critical accounting judgements and estimates
The preparation of these financial statements requires
management to make judgements, estimates and assumptions
that affect the reported amounts of revenues, expenses, assets
and liabilities, and the accompanying disclosures, and the
disclosure of contingent liabilities. The actual future outcomes
may differ from these estimates and give rise to material
adjustments to the reported results and financial position of the
Group. Estimates and underlying assumptions are reviewed on an
ongoing basis, with revisions recognised in the year in which the
estimates are revised and in any future periods affected.
The areas involving a significant degree of judgement or
estimation are set out below and in more detail in the related notes.
Critical accounting judgements
In the process of applying the Group’s accounting policies,
management has made the following accounting judgements,
which have the most significant effect on the amounts recognised
in the consolidated financial statements:
Hudson (Note 30)
Ascential has a significant investment in Hudson MX, Inc.
(“Hudson”), an advertising software business providing media
buying and media accounting solutions through a cloud-based
software as a service (“SaaS”) platform. Critical accounting
judgements in respect of Hudson include:
• Whether we exercised significant influence or control over the
relevant activities of Hudson and therefore over what periods
we should equity account or consolidate Hudson into Ascential’s
financial statements;
• The treatment of options, common stock and preference share
investments, including whether the potential voting rights
conferred gave us significant influence or control and if they
had substance from an ability to exercise standpoint;
• Classification of liabilities and equity, whether they are
extinguished on step accounting, classification and what value
to take as part of consideration or net assets acquired upon step
accounting between equity accounting and acquisition;
• Whether Hudson should be treated as held for sale;
• Whether Hudson should be treated as a discontinued operation.
We have disclosed our detailed considerations in respect to these
matters in Note 30 to the accounts.
Key sources of estimation uncertainty
Hudson (Note 30)
We have been required to make a number of significant estimates
in respect to our investment in Hudson, including:
• Upon our assumption of control for accounting purposes, the
values of consideration and the identification and fair values of
the assets and liabilities acquired;
• The fair value less costs to sell of assets classified as held for sale.
We have disclosed our detailed considerations in respect to these
matters in Note 30 to the accounts.
149
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 4. Operating Segments
The Group has two continuing reportable segments that are used to present information to the Board (Chief Operating Decision Maker).
End-market risks and opportunities vary, and capital allocation decisions are made on the basis of those two reportable segments,
namely Marketing and Financial Technology. The reportable segments offer different products and services and are managed separately
as a result of different capabilities, technology, marketing strategies and end market risks and opportunities.
The following summary describes the operations in each of the Group’s continuing reportable segments:
• Marketing: events, intelligence and advisory that champion creative marketing that matters through improving creative impact and
marketing effectiveness.
• Financial Technology: events and intelligence that improve performance and drive innovation for the global money ecosystem.
In 2023, Acuity was transferred from the Financial Technology segment into the Marketing segment. The 2022 comparatives have not been
restated and so the Financial Technology segment includes revenue of £4.6m and an Adjusted EBITDA of £nil in relation to this business.
Discontinued operations consists of the Digital Commerce and Product Design segments, disposed of subsequent to the year end, and
Hudson MX which is expected to be disposed of in 2024 (refer to Note 11 and Note 30 for further detail).
Information regarding the results of each reportable segment is included below and prior periods are represented to reflect discontinued
operations to provide comparability. Reportable segment profits are measured at an Adjusted operating profit level, representing
reportable segment Adjusted EBITDA, less depreciation costs and amortisation in respect of software intangibles, without allocation of
Corporate costs as reported in the internal management reports that are reviewed by the Board. Reportable segment Adjusted EBITDA
and reportable segment Adjusted operating profit are used to measure performance as management believes that such information is
the most relevant in evaluating the results of the reportable segments relative to other comparable entities. Total assets and liabilities for
each reportable segment are not disclosed because they are not provided to the Board on a regular basis. Total assets and liabilities are
internally reviewed on a Group basis.
Year ended 31 December 2023
(£ million)
Revenue
Adjusted EBITDA
Depreciation and software amortisation
Adjusted operating profit/(loss)
Amortisation of acquired intangible assets and impairment
Non-trading items
Share-based payments
Operating profit/(loss)
Share of net loss in equity-accounted investee
Finance costs
Finance income
Profit/(loss) before tax
Marketing
Financial
Technology
Corporate
costs
Continuing
operations
total
Discontinued
operations
130.5
55.6
(2.8)
52.8
75.9
26.7
(0.1)
26.6
–
(25.9)
(2.0)
(27.9)
206.4
56.4
(4.9)
51.5
(9.0)
(4.4)
(7.4)
30.7
–
(26.6)
6.5
10.6
379.9
65.6
(17.3)
48.3
(30.3)
(105.9)
(16.4)
(104.3)
(13.3)
(124.7)
12.1
(230.2)
Total
586.3
122.0
(22.2)
99.8
(39.3)
(110.3)
(23.8)
(73.6)
(13.3)
(151.3)
18.6
(219.6)
150
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued Year ended 31 December 2022 (Restated)*
(£ million)
Revenue
Adjusted EBITDA
Depreciation and software amortisation
Adjusted operating profit/(loss)
Amortisation of acquired intangible assets and impairment
Non-trading items
Profit on disposal of business
Share-based payments
Operating profit/(loss)
Share of net loss in equity-accounted investee
Finance costs
Finance income
Profit/(loss) before tax
* Restated for discontinued operations (refer to Note 11).
Marketing
Financial
Technology
Corporate
costs
Continuing
operations
total
Discontinued
operations
99.2
40.1
(2.6)
37.5
92.0
31.6
(0.9)
30.7
–
(21.8)
(1.1)
(22.9)
191.2
49.9
(4.6)
45.3
(8.9)
(4.6)
1.0
(5.6)
27.2
–
(8.2)
5.8
24.8
333.2
71.2
(21.1)
50.1
(82.7)
(83.5)
4.1
(10.3)
(122.3)
(3.2)
(19.4)
3.1
(141.8)
Total
524.4
121.1
(25.7)
95.4
(91.6)
(88.1)
5.1
(15.9)
(95.1)
(3.2)
(27.6)
8.9
(117.0)
Non-trading items within continuing operations of £4.4m (2022: £4.6m) include costs attributable to Marketing of £0.7m (2022: £nil),
Financial Technology of £0.3m (2022: £nil) and Corporate of £3.4m (2022: £4.6m).
Revenue and non-current assets by location
The revenue analysis is based on the location of customers. Non-current assets analysis is based on the geographical location of the business.
(£ million)
United Kingdom
Other Europe
United States and Canada
China
Asia Pacific excluding China
Middle East and Africa
Latin America
Total
* Restated for discontinued operations (refer to Note 11)
** Non-current assets exclude deferred tax assets of £92.2m (2022: £60.3m).
Revenue
Non-current assets **
2023
29.7
36.1
107.5
1.1
15.1
7.8
9.1
206.4
2022
(Restated)*
34.7
32.9
97.1
–
13.3
6.0
7.2
191.2
2023
166.1
0.1
44.7
–
1.7
–
–
212.6
2022
323.1
89.6
557.8
77.8
52.2
–
10.6
1,111.1
151
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 4. Operating Segments continued
Additional segmental information on revenue
The Group’s revenue is derived from contracts with customers.
The Group does not have any customers from whom revenue exceeds 10% of total revenue. Included in revenue is barter revenue arising
from the exchange of goods or services of £0.4m for the year ended 31 December 2023 (2022: £0.9m).
Disaggregation of revenue
The following table shows revenue disaggregated by major service lines, and the timing of revenue recognition:
(£ million)
Delegates
Sponsorship
Events
Benchmarking awards
Subscriptions
Advisory
Non-events
Revenue from continuing operations
* Restated for discontinued operations (refer to Note 11).
(£ million)
Events
Benchmarking Awards
Subscriptions
Advisory
Marketing
Events
Subscriptions
Advisory
Financial Technology
Revenue from continuing operations
* Restated for discontinued operations (refer to Note 11).
Timing of revenue recognition
Point in time
Point in time
Point in time
Over time
Over time
Timing of revenue recognition
Point in time
Point in time
Over time
Over time
Point in time
Over time
Over time
2023
56.7
79.3
136.0
30.9
30.2
9.3
70.4
206.4
2023
60.1
30.9
30.2
9.3
130.5
75.9
–
–
75.9
2022
(Restated)*
58.3
67.4
125.7
27.8
30.2
7.5
65.5
191.2
2022
(Restated)*
42.3
27.8
23.9
5.2
99.2
83.4
6.3
2.3
92.0
206.4
191.2
Contract balances
The following table provides information about receivables, contract assets and contract liabilities from contracts with customers:
(£ million)
Receivables, which are included in trade and other receivables
Contract assets – accrued income
Contract liabilities – deferred income
2023
31.9
0.6
54.1
2022
112.1
18.4
117.3
Out of the £117.3m included in contract liabilities at 31 December 2022 (2021: £101.0m), £117.2m (2022: £100.3m) has been recognised as
revenue in the current year.
152
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued 5. Operating profit
Amounts charged in arriving at continuing operating profit include:
(£ million)
Employee costs
Depreciation and software amortisation
Amortisation of acquired intangible assets and impairment
Impairment losses on trade receivables and contract assets
* Restated for discontinued operations (refer to Note 11).
Fees paid to the auditor were as follows:
(£ million)
Included in Adjusted results
Fees paid to auditor for audit of the parent and the consolidated financial statements
Fees paid to auditor for audit of the Group’s subsidiaries – other
Fees paid to auditor for audit-related assurance services**
Total
Included in Adjusting items
Fees paid to auditor for audit of the parent and the consolidated financial statements
Fees paid to auditor for audit of the Group’s subsidiaries – Digital Commerce separation*
Fees paid to auditor for audit-related assurance services**
Total
Total
Fees paid to auditor for audit of the parent and the consolidated financial statements
Fees paid to auditor for audit of the Group’s subsidiaries – Digital Commerce separation*
Fees paid to auditor for audit of the Group’s subsidiaries – other
Fees paid to auditor for audit-related assurance services**
Total
Note
7
2023
77.7
4.9
9.0
–
2022
(Restated)*
77.8
4.6
8.9
0.2
2023
2022
3.2
0.4
0.1
3.7
0.2
3.2
0.8
4.2
3.4
3.2
0.4
0.9
7.9
1.3
0.2
0.1
1.6
–
2.8
0.1
2.9
1.3
2.8
0.2
0.2
4.5
* Fees include costs for the PCAOB audit of the standalone US GAAP Digital Commerce business for 2021 (£1.5m), 2022 (£1.1m) and 2023 (£nil).
** Audit-related assurance services relate to the review of the half-year interim statements £0.1 (2022: £0.1m), Digital Commerce separation-related other costs £nil (2022: £0.1m) and
Ascential’s Class 1 transaction costs of £0.8m (2022: £nil).
Details of the Company’s policy on the use of the auditor for non-audit related services, the reason why the auditor was used and how
the auditor’s independence was safeguarded are set out on page 99.
153
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 6. Adjusting items
Adjusting items are those which are considered significant by virtue of their nature, size or incidence and are presented separately in the
consolidated statement of profit and loss to provide a greater insight into the Group’s financial performance. Adjusting items are not a
defined term under IFRS, so may not be comparable to similar terminology used in other companies’ financial statements and should not be
viewed in isolation but as supplementary information. Adjusting items aim to facilitate a comparative understanding of the Group’s financial
performance from period to period by removing the effect of share-based payment charges, amortisation of intangibles acquired through
business combinations, impairment and Non-trading items such as costs incurred for acquisitions and disposals, integration, non-recurring
business restructuring and capital restructuring. The tax effect of Adjusting items is also included within Adjusting items (see Note 10).
Adjusting items included in continuing operating profit/(loss) are:
(£ million)
Strategic review costs
Transaction and integration costs
Profit/(loss) on disposal of businesses
Property impairments and provisions
Non-trading items
Amortisation of acquired intangible assets
Share-based payments
Adjusting items included within operating profit/(loss)
* Restated for discontinued operations (refer to Note 11).
Note
8
2023
(1.5)
(0.7)
(0.3)
(1.9)
(4.4)
(9.0)
(7.4)
(20.8)
2022
(Restated)*
–
(0.7)
1.0
(3.9)
(3.6)
(8.9)
(5.6)
(18.1)
Strategic review costs totalling £1.5m (2022: £nil) relate to costs incurred to set up the continuing Events business, as a result of the
separation, such as investor relations and rebranding costs. The related net tax impact is a credit of £0.3m.
Transaction and integration costs totalling £0.7m (2022: £0.7m) comprise professional fees for diligence as well as the costs of integrating
acquisitions which in 2023 related to the acquisition of Contagious. Transaction costs are generally non-deductible for tax purposes,
whilst integration costs of £0.1m give rise to a tax credit of £nil.
The loss on disposal of businesses of £0.3m (2022: profit of £1.0m) within continuing operations relates to the additional costs on
disposal of Retail Week World Retail Congress (“RWRC”).
Costs in relation to property impairments and provisions in 2023 of £1.9m (2022: £3.9m) reflect impairments of right-of-use assets and
leasehold improvements and the creation of provisions for operating expenses that were onerous following a reassessment of the
Group’s property requirements. These costs are non-deductible for tax accounting purposes.
The charge for share-based payments of £7.4m (2022: £5.6m) incorporates the Share Incentive Plan, the SAYE and the Performance
Share Plan. As explained in the Alternative Performance Measures section, the Group treats share-based payments as an Adjusting item
because they are a significant non-cash charge driven by a valuation model that references Ascential’s share price and so is subject to
volatility rather than referencing operational activity. Share-based payment expenses give rise to a tax credit of £1.1m to income
statement net of a £1.4m charge through equity.
7.
Employee information and Directors’ remuneration
a. Employee costs including Directors
(£ million)
Wages and salaries
Social security costs
Defined contribution pension cost
Redundancy costs*
Share-based payments and associated employment taxes
Total
Continuing operations (Restated)**
Discontinued operations (Restated)**
Note
8
2023
243.5
26.1
6.0
1.0
23.8
300.4
77.7
222.7
* Certain redundancy costs relating either to integration or to the sale of WGSN and Digital Commerce have been included within Non-trading items.
** Restated for discontinued operations (refer to Note 11).
Average employee cost per employee for continuing operations was £110,000 (2022 (Restated): £106,000).
2022
224.4
24.6
5.3
0.8
15.9
271.0
77.8
193.2
154
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued b. Retirement benefits
The Group operates a defined contribution pension scheme in the United Kingdom and in certain other countries. The assets of the
scheme are held by independent custodians and are kept entirely separate from the assets of the Group. The pension charge represents
contributions due from the employer. During 2023 the total Group charge amounted to £6.0m (2022: £5.3m). At 31 December 2023 there
were £1.2m of contributions outstanding (2022: £0.9m) of which £0.9m relate to continuing operations.
The pension charge for continuing operations amounted to £2.1m (2022: £1.9m). The pension charge for discontinued operations
amounted to £3.9m (2022: £3.4m).
c. Average monthly number of employees including Directors
i.
By geographical region
United Kingdom
United States and Canada
China
Asia Pacific excluding China
Rest of the world
Total
* Restated for discontinued operations (refer to Note 11).
ii.
By segment
Product Design
Marketing
Financial Technology
Digital Commerce
Hudson
Corporate
Total
2023
2022 (Restated)*
Continuing
Discontinued
Continuing
Discontinued
565
88
6
35
9
703
479
1,209
640
605
360
3,293
590
90
24
19
14
737
391
963
792
330
375
2,851
2023
2022 (Restated)*
Continuing
Discontinued
Continuing
Discontinued
–
347
117
–
–
239
703
590
–
–
2,685
18
–
3,293
–
301
162
–
–
274
737
2023
3.6
0.2
3.8
508
–
–
2,343
–
–
2,851
2022
3.0
–
3.0
* Restated for discontinued operations (refer to Note 11).
d. Remuneration of Directors and key management personnel
The aggregate emoluments for key management are set out below:
(£ million)
Salaries, bonus and other short-term employee benefits
Share-based payments
Total
During the years ended 31 December 2023 and 2022, no Directors were members of the Group’s defined contribution pension scheme
and no retirement benefits were accrued for any Director at 31 December 2023 or 2022. The total gains on the exercise of share options
by the Directors amounted to £0.2m (2022: £1.3m).
Total remuneration of Directors and key management personnel for continuing operations amounted to £2.3m (2022: £2.0m). Total
remuneration of Directors and key management personnel for discontinued operations amounted to £1.5m (2022: £1.0m).
Further details of the Directors’ remuneration and share options are set out in the Remuneration Report on pages 115 to 125. Key
management personnel during the year comprised the Chief Executive Officer, Chief Financial Officer, Chief Operating Officer and the
Non-Executive Directors of the Group.
155
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 8. Share-based payments
Employees of the Group receive remuneration in the form of share-based payments, whereby employees render services in exchange
for equity instruments (equity-settled transactions).
Analysis of charge to the consolidated statement of profit or loss:
(£ million)
Share Incentive Plans (“SIP”)
Sharesave Scheme (“Sharesave”)
Deferred Annual Bonus Plan (“DABP”)
Performance Share Plans (“PSP”)
Restricted Share Plan (“RSP”)
Total charge for the year
Continuing operations (Restated)*
Discontinued operations (Restated)*
* Restated for discontinued operations (refer to Note 11).
2023
2022
2.2
0.2
1.4
14.4
5.6
23.8
7.4
16.4
1.4
0.8
0.3
7.9
5.5
15.9
5.6
10.3
The total share-based payment charge including discontinued operations for the year ending 31 December 2023 was £23.8m (2022:
£15.9m) of which £7.4m relates to continuing operations (2022 (Restated): £5.6m).
In 2023, the share-based payment charge includes a charge of £1.0m (2022: credit of £0.8m) which is not reflected in the Consolidated
Statement of Changes in Equity. This relates to the movement in provision for employment taxes as a result of the increase in share price
from the prior year.
The number and weighted average exercise price of outstanding and exercisable share options and share awards are detailed below:
Outstanding at 1 January
Granted
Options exercised or shares vested
Surrendered or expired
Lapsed
At 31 December
Weighted average fair value per share/option granted during the year (£)
2023
2022
Number of
shares/options
000s
Weighted
average exercise
price £
Number of
shares/options
000s
Weighted
average
exercise price £
17,055
4,221
(4,502)
(696)
(1,604)
14,474
0.40
–
0.11
2.42
–
0.30
17,334
5,722
(2,167)
(1,023)
(2,811)
17,055
2023
2.65
0.31
0.72
0.11
2.63
–
0.40
2022
1.99
At 31 December 2023 the market price of an Ascential share was £2.93 (2022: £2.02) and the average share price for 2023 was £2.40
(2022: £2.75).
At 31 December 2023 of the 14,474,329 outstanding shares awards and options, 14,253,929 either had no exercise cost or an exercise
price below market price; the remaining 220,400 (2022: 922,000) share options had an exercise price above market price.
The shares awarded under the SIP do not require additional payment from the participant to vest. For the Sharesave plan, the range of
exercise prices for share options outstanding at 31 December 2023 was £1.69 to £3.33 (2022: £1.69 to £3.33). For the DABP, PSP and RSP
plans, all share options outstanding at 31 December 2023 had an exercise price of £nil (2022: £nil) or were conditional share awards which
do not require additional payment from the participant to vest.
For share awards and options outstanding at 31 December 2023, the weighted average remaining contractual life was 1.29 years (2022:
1.65 years).
156
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued Measurement of fair values
The SIP, Sharesave, DABP, PSP, RSP awards are equity-settled plans, the fair value of which is determined at the date of grant and is not
subsequently remeasured unless conditions on which the award was granted are modified.
The fair value of the Sharesave options has been measured using the Black-Scholes model. Expected volatility is usually measured over a
three-year period immediately prior to the date of the grant. There were no Sharesave options granted in 2023. The DABP, PSP and RSP
awards granted in the year have no market performance conditions associated with them and so fair value is deemed to be the share
price at the date of grant.
During the year, Ascential’s strategic review triggered modifications to the existing share plans. These modifications represented
changes in non-market based terms, and therefore there was no impact on the fair value of the awards and options. An incremental
charge of £6.5m (2022: £nil) was incurred by these modifications which included the acceleration of vesting for good leavers.
Share Incentive Plan
Additional information about share-based payments
a.
In 2016, the Group established the Employee Share Incentive Plan and International Employee Free Share Plan (collectively known as the
“SIP”) which enables employees to acquire shares of the Company, subject to service conditions. Free shares awarded to UK employees
are held by an Employee Benefit Trust for the maturity period of three years. Conditional awards and cash equivalent awards granted to
international employees also have a three-year maturity period. In 2023, the Group did not make any awards under the SIP (2022: none).
Sharesave Plan
b.
In 2016, the Group established the Employee Savings Related Share Option Plan, the International Savings Related Share Option Plan and
the US Stock Purchase Plan (collectively known as the “Sharesave Plan”) under which employees enter into a savings contract and are
granted options to acquire shares of the Company, subject to service conditions. In 2023, the Group did not grant any award options
under the Sharesave Plan (2022: 2,281,000). Under the UK and International plans, the options vest after three years and are exercisable
for a six-month period. Under the US plan, they vest after two years and are exercisable for a three-month period.
Deferred Annual Bonus Plan
c.
Under the Deferred Annual Bonus Plan (“DABP”) a portion of Executive Directors’ annual bonus earned is deferred mandatorily into a
share award, vesting after a three-year period. Awards are structured either as a nil-cost option or a conditional share award. In 2023, the
Group granted conditional share awards over 171,558 shares under the DABP (2022: 365,000).
Performance Share Plan
d.
In 2016, the Group established the Executive Performance Share Plan (“PSP”), under which key management personnel and other senior
employees can be granted conditional awards, share options or a cash alternative. Awards can be granted with or without performance
conditions. Where performance conditions have been set, they are either subject to a Total Shareholder Return (“TSR”) market
performance condition, a revenue or profit non-market performance condition or a combination of both. Executive Directors are
required to hold their shares (net of taxes) for a further two-year period after vesting.
In 2023, the Group granted conditional share awards over 2,730,396 (2022: 2,585,000) shares under the PSP. None of the share awards
granted during the year are subject to a market performance condition. 1,304,170 (2022: 1,060,000) shares are subject to a revenue or
non-market profit performance condition and 1,426,226 (2022: 1,525,000) shares are not subject to additional performance criteria
beyond service conditions.
Restricted Share Plan
e.
In 2019, the Group established the Ascential Restricted Share Plan (“RSP”), under which certain employees can be granted nil-cost option
awards and/or contingent share awards. Executive Directors are not eligible to receive awards under the RSP. Awards under the RSP are
satisfied with market purchased shares and can be granted with or without performance conditions. Awards that have been issued to
date are not subject to performance conditions. During the year ended 31 December 2023, the Group granted conditional share awards
over 1,319,521 shares under the RSP (2022: 490,000).
157
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 9.
Finance costs and finance income
(£ million)
Interest on deposits and derivatives
Fair value gain on derivative financial instruments
Foreign exchange gain
Adjusted finance income
Remeasurement of trade investments to fair value
Adjusting finance income
Total finance income
Interest payable on external borrowings
Amortisation of arrangement fees
Discount unwind of lease liability
Discount unwind on provisions
Fair value loss on derivative financial instruments
Adjusted finance costs
Net finance costs from continuing operations
* Restated for discontinued operations (refer to Note 11).
10. Taxation
Current tax
The tax charge for the year on continuing operations comprises:
(£ million)
Current tax
UK current tax charge on income for the year
Overseas current tax (credit)/charge on income for the year
Adjustments in respect of prior years
Total current tax charge
Deferred tax
Current year (credit)/charge
Adjustments in respect of prior years
Impact of rate changes on opening balances
Total deferred tax charge
Total tax charge from continuing operations
Total effective tax rate
* Restated for discontinued operations (refer to Note 11).
Note
18
22
23
2023
5.6
–
–
5.6
0.9
0.9
6.5
(21.3)
(0.8)
(0.1)
(0.1)
(4.3)
(26.6)
(20.1)
2022
(Restated)*
0.5
4.3
1.0
5.8
–
–
5.8
(7.4)
(0.8)
–
–
–
(8.2)
(2.4)
2023
2022
(Restated)*
5.5
(1.1)
(2.1)
2.3
(0.7)
3.2
–
2.5
4.8
46%
–
1.5
0.1
1.6
6.8
(0.2)
(0.2)
6.4
8.0
32%
158
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued The difference between the tax as charged in the consolidated statement of profit or loss and tax at the UK standard rate on continuing
operations is reconciled below:
2023
2022 (Restated)*
Adjusted
results/tax
Adjusting
items/tax
Total results/
tax
Adjusted
results/tax
Adjusting
items/tax
Total results/
tax
30.5
(19.9)
10.6
(£ million)
Profit/(loss) before tax
Expected tax charge/(credit) at the UK standard rate of
23.5% (2022: 19%)
7.2
(4.7)
Tax effects of:
Higher overseas tax rates
Non-deductible expenditure
UK enhanced capital allowances
Taxable disposals
Rates changes
Adjustments in respect of prior years
Total tax charge/(credit) for the year
Effective tax rate
0.2
(0.1)
–
–
–
0.8
8.1
27%
–
0.7
–
–
0.4
0.3
(3.3)
17%
2.5
0.2
0.6
–
–
0.4
1.1
4.8
46%
42.9
8.2
2.8
0.1
(0.1)
–
(0.1)
–
10.9
25%
(18.1)
(3.4)
–
0.8
–
0.3
(0.5)
(0.1)
(2.9)
16%
24.8
4.8
2.8
0.9
(0.1)
0.3
(0.6)
(0.1)
8.0
32%
* Restated for discontinued operations (refer to Note 11).
Note 6 includes further details on the tax treatment of costs treated as Adjusting items.
During the year the following amounts were recognised in other comprehensive income and equity relating to share-based payments
and foreign exchange movements:
(£ million)
Deferred tax charge related to share-based payments
Deferred tax charge related to net investment hedge
Tax (credit)/charge related to foreign exchange movements
Total (credit)/charge recognised in equity
2023
1.8
1.4
(4.8)
(1.6)
2022
2.8
–
14.4
17.2
The Group is subject to many different forms of taxation including, but not limited to, income and corporation tax, withholding tax and
value added and sales taxes. The Group had operations in 22 countries and multiple states in the US and sold its products and services
into more than 100 countries in the year. Furthermore, the Group renders and receives cross-border supplies and services in respect of
affiliated entities which exposes the Group to tax risk due to transfer pricing rules that apply in many jurisdictions.
Deferred tax
The deferred tax balances shown in the consolidated statement of financial position are analysed as follows:
(£ million)
Deferred tax assets
Deferred tax liabilities
Total
2023
92.2
(7.6)
84.6
2022
60.3
(8.6)
51.7
In presenting its deferred tax balances, the Group offsets assets and liabilities to the extent it has a legally enforceable right to set off the
arising current tax liabilities and assets when those deferred tax balances reverse and income taxes are levied by the same tax authorities.
159
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 10. Taxation continued
The major deferred tax assets and liabilities recognised by the Group, and the movements in the year, are set out below:
(£ million)
At 1 January 2022
Credit/(charge) to the consolidated
statement of profit or loss
Charge to equity
Tax effect of items charged directly to equity
Reclassification
Impact of rate changes
Adjustments in respect of prior years
Foreign exchange movements
Acquisitions
Held for sale
At 1 January 2023
Credit/(charge) to the consolidated
statement of profit or loss
Charge to equity
Tax effect of items charged directly to equity
Adjustments in respect of prior years
Foreign exchange movements
Acquisitions
Held for sale
At 31 December 2023
Non-
deductible
intangible
assets
US deductible
intangible
assets
Share-based
payments
Property, plant
and
equipment
Tax losses
Other
(26.1)
30.9
6.5
–
–
–
–
–
(1.5)
(8.3)
–
(29.4)
5.4
–
–
(0.3)
0.7
(2.0)
10.3
(15.3)
6.1
–
–
–
–
0.4
4.1
–
–
41.5
(13.4)
–
–
–
(0.3)
–
–
27.8
2.5
2.0
(2.8)
–
–
–
–
–
–
–
1.7
1.5
(1.8)
–
–
–
–
(0.1)
1.3
6.3
33.5
(2.8)
–
–
–
0.2
1.6
0.6
–
0.3
6.2
(7.0)
–
(3.3)
1.1
–
(0.1)
2.3
4.0
–
30.5
(0.8)
47.3
–
–
–
–
–
(1.1)
4.3
–
–
(2.9)
(0.6)
0.9
(9.0)
66.2
4.1
1.1
–
(1.6)
(1.1)
–
(1.2)
(0.1)
–
–
1.2
–
–
(0.9)
–
–
–
–
0.3
The above deferred tax balances are expected to reverse as follows:
(£ million)
Within 12 months
After 12 months
At 31 December 2022
Within 12 months
After 12 months
At 31 December 2023
Non-
deductible
intangible
assets
US deductible
intangible
assets
Share-based
payments
Property plant
and
equipment
Tax losses
Other
(4.2)
(25.2)
(29.4)
(1.5)
(13.8)
(15.3)
7.6
33.9
41.5
27.8
–
27.8
(1.5)
3.2
1.7
–
1.3
1.3
–
6.2
6.2
–
4.3
4.3
7.8
22.7
30.5
66.2
–
66.2
–
1.2
1.2
(2.7)
3.0
0.3
Total
51.2
5.9
(2.8)
(4.9)
–
0.2
0.7
5.4
(4.3)
0.3
51.7
40.0
(1.8)
(0.9)
(3.2)
(0.2)
(1.1)
0.1
84.6
Total
9.7
42.0
51.7
89.8
(5.2)
84.6
No deferred tax liability has been recognised in respect of temporary differences associated with investments in subsidiaries as, where
tax would arise on the realisation of those temporary differences, the Group is in a position to control the timing of their reversal and it is
probable that such differences will not reverse in the foreseeable future.
Non-deductible intangibles represent the value of the deferred tax liability which arises on the fair value of acquired intangibles which are
not deductible for tax purposes. The liability is valued at the tax rate applicable to the jurisdiction where the intangibles are located.
US deductible intangible assets represent the value of deferred tax assets on US tax deductible intangibles and deferred consideration.
These deferred tax assets are recognised at a blended US Federal and State tax rate of 26%.
160
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued As explained in Note 11, after the balance sheet date, the Group disposed of the Digital Commerce and WGSN businesses in January
2024 which has significant tax implications. The disposals of shares in the UK benefit from the UK substantial shareholdings exemption
and, as such, no UK tax is expected to arise on the disposals. However, the disposal of US assets will result in a material taxable gain in the
US. The US gains arise on the sale of shares in the US Digital Commerce business as well as the structuring steps required to transfer our
remaining US businesses from our main US holding company to facilitate the sale of the WGSN US business.
We estimate that the tax charge arising on the gains will be approximately £100m, comprising a current tax charge (and cash tax
payment) of £9m and a deferred tax charge of £91m. The deferred tax charge represents the utilisation of deferred tax assets totalling
£40.4m and £23.1m in respect of US net operating losses and of US capital losses respectively, as well as the full £27.8m of deferred tax
asset in respect of US deductible intangible assets. This supports the recognition of these deferred tax assets at the balance sheet date.
Partly offsetting the above tax charge on disposal, we expect the transfer of our remaining US businesses to new US companies to give
rise to tax amortisation on US acquired intangibles going forward. This will create a temporary difference (an increase in tax basis with no
equivalent change in book basis) on which a deferred tax asset is recognised. The deferred tax asset is expected to be approximately
£45m, generating cash tax savings of approximately £3m per annum. Based on our forecasts for the US businesses, we would have
sufficient profit capacity in each year to utilise this asset and so would expect to recognise the deferred tax asset of £45m in full in 2024.
The Group has the following tax losses:
(£ million)
US net operating losses
US capital losses
UK net operating losses
UK capital losses
Other Rest of World losses
Total
Recognised
2023
Recognised
2022
Unrecognised
2023
Unrecognised
2022
147.1
88.8
9.5
–
3.8
249.2
80.8
–
26.3
–
6.4
113.5
9.7
–
–
114.9
–
124.6
9.7
–
–
114.9
23.4
148.0
The above losses represent the following value at tax rates applicable at the reporting date:
(£ million)
US net operating losses
US capital losses
UK net operating losses
UK capital losses
Other Rest of World losses
Total
Recognised
2023
Recognised
2022
Unrecognised
2023
Unrecognised
2022
40.4
23.1
2.1
–
0.6
66.2
23.1
–
6.1
–
1.3
30.5
2.0
–
–
28.7
–
30.7
2.0
–
–
28.7
7.2
37.9
Total
2023
156.8
88.8
9.5
114.9
3.8
373.8
Total
2023
42.4
23.1
2.1
28.7
0.6
96.9
Total
2022
90.5
–
26.3
114.9
29.8
261.5
Total
2022
25.1
–
6.1
28.7
8.5
68.4
The Group has recognised net operating tax losses in the US totalling £147.1m (2022: £80.8m) none of which are subject to expiry. Our
ability to utilise losses in future years is driven by the level of taxable profits arising in the relevant taxing jurisdictions. For losses arising in
the US, the recognition of these is supported by the expected taxable profits arising on the gains on disposal of the WGSN and Digital
Commerce businesses in 2024.
We recognise for the first time this year US capital losses which arise as a result of the consolidation of Hudson. We expect these tax
assets to be fully utilised against the disposal gains made after year end.
We do not expect to make gains in the future against which our UK capital losses could be utilised as the Group does not typically hold
assets which would give rise to UK capital gains. Therefore these losses are unrecognised for deferred tax purposes.
The reduction in Rest of World unrecognised losses from the prior year arises as these losses arose in companies now held for sale and
so are excluded from the closing balance.
161
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 11. Discontinued operations
On 30 October 2023, the Group announced that it had entered into agreements to sell its Digital Commerce and WGSN businesses.
Although these agreements were subject to shareholder approval, which was obtained on 18 December 2023, the Group believed that it
was highly probable that the transactions would complete within 12 months of the date of the announcement and so were classified as
disposal groups held for sale and discontinued operations from that date. The Digital Commerce transaction completed on 2 January
2024, the WGSN transaction completed on 1 February 2024 and the Hudson transaction is expected in the first half of 2024.
The results of Digital Commerce, WGSN and Hudson for the year are presented below. For further details of the investment in Hudson
see Note 30.
a.
Digital Commerce:
(£ million)
Revenue
Cost of sales
Sales, marketing and administrative expenses
Impairment loss on trade receivables and contract assets
Operating profit/(loss)
Adjusted EBITDA
Depreciation, amortisation and impairment
Non-trading items
Share-based payments
Operating profit/(loss)
Finance costs
Finance income
Loss before tax from discontinued operations
Tax credit/(charge)
Loss from discontinued operations, net of tax
b. WGSN:
(£ million)
Revenue
Cost of sales
Sales, marketing and administrative expenses
Impairment loss on trade receivables and contract assets
Operating profit/(loss)
Adjusted EBITDA
Depreciation, amortisation and impairment
Non-trading items
Share-based payments
Operating profit/(loss)
Share of the loss of associates
Finance costs
Finance income
Profit/(loss) before tax from discontinued operations
Tax credit/(charge)
Profit/(loss) from discontinued operations, net of tax
2023
Adjusted
results
Adjusting
items
263.5
(158.4)
(105.9)
(4.6)
(5.4)
8.9
(14.3)
–
–
(5.4)
(6.8)
0.1
(12.1)
(0.1)
(12.2)
–
–
(112.9)
–
(112.9)
–
(30.1)
(69.9)
(12.9)
(112.9)
–
1.7
(111.2)
22.1
(89.1)
2023
Adjusted
results
Adjusting
items
114.9
(20.1)
(38.2)
(1.3)
55.3
58.3
(3.0)
–
–
55.3
(0.1)
(0.3)
0.1
55.0
(14.4)
40.6
–
–
(37.7)
–
(37.7)
–
(0.2)
(34.0)
(3.5)
(37.7)
–
–
–
(37.7)
4.0
(33.7)
2022
Adjusted
results
Adjusting
items
226.1
(126.1)
(94.6)
(5.3)
0.1
17.9
(17.8)
–
–
0.1
(13.6)
–
(13.5)
1.1
(12.4)
–
–
(166.2)
–
(166.2)
–
(82.5)
(75.5)
(8.2)
(166.2)
(5.3)
–
(171.5)
28.9
(142.6)
2022
Adjusted
results
Adjusting
items
107.1
(20.6)
(35.5)
(1.2)
49.8
53.1
(3.3)
–
–
49.8
(0.4)
(0.5)
–
48.9
(11.2)
37.7
–
–
(4.4)
–
(4.4)
–
(0.2)
(2.1)
(2.1)
(4.4)
–
–
–
(4.4)
0.5
(3.9)
Total
263.5
(158.4)
(218.8)
(4.6)
(118.3)
8.9
(44.4)
(69.9)
(12.9)
(118.3)
(6.8)
1.8
(123.3)
22.0
(101.3)
Total
114.9
(20.1)
(75.9)
(1.3)
17.6
58.3
(3.2)
(34.0)
(3.5)
17.6
(0.1)
(0.3)
0.1
17.3
(10.4)
6.9
Total
226.1
(126.1)
(260.8)
(5.3)
(166.1)
17.9
(100.3)
(75.5)
(8.2)
(166.1)
(18.9)
–
(185.0)
30.0
(155.0)
Total
107.1
(20.6)
(39.9)
(1.2)
45.4
53.1
(3.5)
(2.1)
(2.1)
45.4
(0.4)
(0.5)
–
44.5
(10.7)
33.8
162
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued c.
Hudson:
(£ million)
Revenue
Cost of sales
Sales, marketing and administrative expenses
Operating profit/(loss)
Adjusted EBITDA
Depreciation, amortisation and impairment
Non-trading items
Operating profit/(loss)
Share of the loss of associates
Finance costs
Finance income
Profit/(loss) before tax from discontinued operations
Tax credit/(charge)
Profit/(loss) from discontinued operations, net of tax
d.
Total discontinued operations
(£ million)
Revenue
Cost of sales
Sales, marketing and administrative expenses
Impairment loss on trade receivables and contract assets
Operating profit/(loss)
Adjusted EBITDA
Depreciation, amortisation and impairment
Non-trading items
Share-based payments
Operating profit/(loss)
Share of the loss of associates
Finance costs
Finance income
Loss before tax from discontinued operations
Tax credit/(charge)
Profit/(loss) from discontinued operations, net of tax
2023
Adjusted
results
Adjusting
items
1.5
(1.8)
(1.3)
(1.6)
(1.6)
–
–
(1.6)
(12.3)
–
10.2
(3.7)
–
(3.7)
379.9
(180.3)
(145.4)
(5.9)
48.3
65.6
(17.3)
–
–
48.3
(12.4)
(7.1)
10.4
39.2
(14.5)
24.7
–
–
(2.0)
(2.0)
–
–
(2.0)
(2.0)
(0.9)
(117.6)
–
Total
1.5
(1.8)
(3.3)
(3.6)
(1.6)
–
(2.0)
(3.6)
(13.2)
(117.6)
10.2
(120.5)
(124.2)
23.1
(97.4)
23.1
(101.1)
–
–
(152.6)
–
Total
379.9
(180.3)
(298.0)
(5.9)
(152.6)
(104.3)
–
(30.3)
(105.9)
(16.4)
(152.6)
(0.9)
(117.6)
1.7
65.6
(47.6)
(105.9)
(16.4)
(104.3)
(13.3)
(124.7)
12.1
(269.4)
(230.2)
49.2
34.7
(220.2)
(195.5)
2023
Adjusted
results
Adjusting
items
2022
Adjusted
results
Adjusting
items
–
–
0.2
0.2
0.2
–
–
0.2
(2.2)
–
3.1
1.1
–
1.1
–
–
(0.9)
(0.9)
–
–
(0.9)
(0.9)
(0.6)
–
–
(1.5)
–
(1.5)
2022
Adjusted
results
Adjusting
items
333.2
(146.7)
(129.9)
(6.5)
50.1
71.2
(21.1)
–
–
50.1
(2.6)
(14.1)
3.1
36.5
(10.1)
26.4
Total
–
–
(0.7)
(0.7)
0.2
–
(0.9)
(0.7)
(2.8)
–
3.1
(0.4)
–
(0.4)
Total
333.2
(146.7)
(302.3)
(6.5)
(122.3)
71.2
(103.8)
(79.4)
(10.3)
–
–
(172.4)
–
(172.4)
–
(82.7)
(79.4)
(10.3)
(172.4)
(122.3)
(0.6)
(5.3)
–
(178.3)
29.4
(148.9)
(3.2)
(19.4)
3.1
(141.8)
19.3
(122.5)
163
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 11. Discontinued operations continued
Adjusting items:
e.
Adjusting items included within discontinued operations include Non-trading items as follows:
(£ million)
Strategic review costs
Transaction and integration costs
ERP and Salesforce implementation
Profit on disposal of businesses
Acquisition-related employment costs and earnout revaluations
Non-trading items
2023
(83.5)
(17.3)
(7.1)
0.2
1.8
(105.9)
2022
(Restated)*
(15.0)
(15.5)
(21.6)
4.1
(31.4)
(79.4)
Strategic review costs of £83.5m (2022: £15.0m) related to resources and professional fees incurred specifically in respect of the sales of
the Digital Commerce and WGSN businesses, as well as the necessary restructuring and reduction of Ascential’s central corporate
function as a result of the disposal of such a large proportion of the Group. These costs related to resources and professional fees for
project management, tax and legal structuring, activities relating to the aborted US listing, legal and professional advisor support as well
as severance and retention incentives for key personnel impacted by the separation of the Group. Fees also include success fees paid to
the banks managing the disposal processes. The vast majority of these costs have been recognised in 2023 either as services have been
provided or, for contingent success fees, on shareholder approval of the disposals which occurred in December 2023. These costs
generate a tax credit of £11.5m (2022: £0.9m).
Transaction and integration costs of £17.3m (2022: £15.5m) comprise professional fees for diligence and legal costs for acquisitions and
investments as well as the costs of integrating acquisitions, such as the acquisitions of Sellics and Intrepid by the Digital Commerce
business in 2022 and their subsequent integration. It also includes the execution of a significant staff reduction in the second half of
2023 following the product integration and launch of the Digital Commerce combined product Flywheel Commerce Cloud. These costs
generate a tax credit of £4.4m (2022: £2.3m).
Acquisition-related employment costs and revaluations of £1.8m credit (2022: £31.4m debit) relates to the revaluation of deferred
contingent consideration as a result of updates to actual or expected performance along with costs associated with the element of
purchase consideration connected directly not only with the performance of the acquiree, but on the continuing employment of the
founder. These costs generate a tax credit of £2.7m (2022: £5.8m).
The ERP and Salesforce implementation fees of £7.1m (2022: £21.6m) are in respect of the final year of a multi-year programme to
implement a new ERP in Digital Commerce to replace the Oracle system introduced in 2007 and a new instance of Salesforce, both of
which are cloud-based. The implementation costs are subject to the IFRIC agenda decision relating to IAS 38 taken after initiation of the
project and accordingly were required to be expensed. Given the materiality and once-in-a-decade nature, these costs were recorded as
Non-trading items. These costs generate a tax credit of £1.7m (2022: £4.1m).
2022 includes a £5.0m profit on the sale of our trade investment Analytic Index which was previously accounted for as an associate.
Depreciation, amortisation and impairment included in Adjusting items within discontinued operations for the year of £30.3m (2022:
£82.7m) include a £11.7m impairment in respect to Flywheel brand intangibles within Digital Commerce as a result of the decision to
move to a single brand “Flywheel Digital”. 2022 includes £57.0m impairment in respect to ASR (£25.6m) and Edge (£31.4m) brand assets.
Finance costs include fair value adjustments relating to the transition of Hudson between an equity-accounted associate and full
consolidation in the period of £116.7m (2022: £nil) (see Note 30 for further details). We recognise a deferred tax asset of £23.1m (2022:
£nil) in respect of these fair value adjustments.
Exchange translation differences recognised between the date of classification as held for sale and 31 December 2023 are reflected in
other comprehensive income.
164
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued The major classes of assets and liabilities classified as held for sale as at 31 December are, as follows:
Digital
Commerce
2023
398.1
145.8
5.7
8.3
11.6
6.4
323.5
33.8
–
933.2
280.2
12.5
36.0
8.7
5.6
1.7
344.7
(£ million)
Assets
Goodwill
Intangible assets
Property, plant and equipment
Right-of-use assets
Investments
Inventories
Trade and other receivables
Cash and cash equivalents
Deferred tax assets
Assets held for sale
Assets held for sale relating to subsidiary acquired exclusively with a view to resale
Total assets held for sale
Liabilities
Trade and other payables
Deferred income
Deferred and contingent consideration
Lease liabilities
Deferred tax liabilities
Provisions
Liabilities held for sale
Liabilities held for sale relating to subsidiary acquired exclusively with a view to resale
Total liabilities held for sale
Net assets directly associated with disposal group
Amounts included in reserves directly associated with disposal group
Non-controlling interest
Translation reserve
Reserve of disposal group classified as held for sale
The net cash flows generated/(incurred) by discontinued operations were as follows:
(£ million)
Operating
Investing
Financing
Net cash inflow/(outflow)
WGSN
2023
154.4
5.0
0.4
0.5
3.6
1.0
27.7
11.8
5.5
209.9
9.7
55.7
–
0.4
–
0.1
65.9
2023
(63.5)
(60.4)
139.6
15.7
Total
2023
552.5
150.8
6.1
8.8
15.2
7.4
351.2
45.6
5.5
1,143.1
62.5
1,205.6
289.9
68.2
36.0
9.1
5.6
1.8
410.6
3.3
413.9
791.7
20.0
28.0
48.0
2022
5.4
(159.4)
154.6
0.6
165
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 12. Earnings per share
Basic earnings per share is calculated by dividing the net profit or loss for the year attributable to ordinary shareholders by the weighted
average number of ordinary shares outstanding during the year. Diluted earnings per share is calculated by dividing the net profit or loss
for the year attributable to ordinary shareholders by the weighted average number of ordinary shares outstanding during the year plus
the weighted average number of ordinary shares that would be issued on the conversion of all dilutive potential ordinary shares into
ordinary shares. Earnings per share has been calculated with respect to total net profit or loss for the year for the Group, including both
continuing and discontinued operations (see Note 11).
The weighted average number of ordinary shares in issue during the year, excluding those held by Employee Benefit Trusts, was 439.2m
(2022: 440.0m). There is no dilutive impact from potential ordinary shares as potential ordinary shares can only be considered dilutive
when their inclusion would decrease earnings or increase loss per share.
Profit/(loss) for the year attributable to owners of the Company
(£ million)
Continuing operations
Discontinued operations
Profit/(loss) for the year
Share number (million)
Basic weighted average number of shares
Dilutive potential ordinary shares
Diluted weighted average number of shares
Earnings/(loss) per share (pence)
– Basic earnings per share
– Diluted earnings per share
Continuing operations
– Basic earnings per share
– Diluted earnings per share
Discontinued operations
– Basic earnings per share
– Diluted earnings per share
* Restated for discontinued operations (refer to Note 11).
2023
2022 (Restated)*
Adjusted
results
Adjusting
items
Total
Adjusted
results
Adjusting
items
Total
22.4
22.2
44.6
439.2
7.2
446.4
10.2
10.0
5.1
5.0
5.1
5.0
(16.6)
(219.3)
(235.9)
439.2
7.2
446.4
(53.8)
(52.9)
(3.8)
(3.7)
(50.0)
(49.2)
5.8
(197.1)
(191.3)
439.2
7.2
446.4
(43.6)
(42.9)
1.3
1.3
(44.9)
(44.2)
32.0
24.6
56.6
440.0
6.2
446.2
12.9
12.7
7.3
7.2
5.6
5.5
(15.2)
(137.8)
(153.0)
440.0
6.2
446.2
(34.8)
(34.3)
(3.5)
(3.4)
(31.3)
(30.9)
16.8
(113.2)
(96.4)
440.0
6.2
446.2
(21.9)
(21.6)
3.8
3.8
(25.7)
(25.4)
166
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued 13. Business combinations
In 2023, Ascential made the following acquisition in the Marketing segment. Further to this, the Group undertook a series of transactions
in the year that resulted in the deemed control and acquisition of Hudson. Details of this are presented in Note 30.
Contagious
In August 2023, the Group acquired 100% of Steel River Media Limited (“Contagious”) for a cash consideration of £9.4m. Contagious is a
creative and strategic intelligence firm that helps agencies and brands supercharge their marketing by learning from the world’s most
creative and effective companies and campaigns via their IQ intelligence platform, consulting services, training and events.
In addition to £0.6m of transaction costs, the Group incurred £0.1m of integration costs.
The goodwill of £5.4m comprises earnings attributable to growth through new customer relationships and new content developed,
opportunities for expansion into new geographies and the assembled workforce. This goodwill is not expected to be deductible for tax
purposes and is allocated entirely to the Contagious CGU. The valuation of intangible assets acquired in business combinations is based
on a number of estimates made by management. No reasonable change to the accounting estimates would result in a material change
to the valuation of intangible assets acquired.
The provisional fair values of the identifiable assets purchased and liabilities assumed as at the date of acquisition were as follows:
(£ million)
Customer relationships
Brands
Content
Intangible assets
Trade and other receivables
Cash
Trade and other payables
Provisions
Deferred income
Deferred tax liability
Total identifiable net assets at fair value
Total consideration
Goodwill on acquisition
Acquisition of business (net of cash acquired)
2022 Acquisitions
The details of the prior year acquisitions are set out in the 2022 Annual Report and Accounts.
Note
Contagious
16
16
16
16
10
16
2.7
0.3
1.6
0.1
1.4
2.6
(1.9)
(0.2)
(1.5)
(1.1)
4.0
9.4
5.4
6.8
167
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 14. Non-controlling interests
The following table summarises the information relating to each of the Group’s subsidiaries that has material Non-controlling interests
(“NCI”):
(£ million)
NCI percentage
Non-current assets
Current assets
Non-current liabilities
Current liabilities
Net assets
Net assets attributable to NCI
Profit/(loss) for the year and total comprehensive income
Profit/(loss) allocated to NCI
(£ million)
NCI percentage
Non-current assets
Current assets
Non-current liabilities
Current liabilities
Net assets
Net assets attributable to NCI
Profit/(loss) for the year and total comprehensive income
Profit/(loss) allocated to NCI
2023
CTIC WGSN
China
51%
0.7
5.5
–
(4.2)
2.0
1.0
1.5
0.8
2022
CTIC WGSN
China
51%
–
6.4
–
(4.0)
2.4
1.2
3.6
1.8
ASR
49%
35.9
6.4
(0.2)
(3.3)
38.8
19.0
2.0
1.0
ASR
49%
39.1
4.5
(0.1)
(1.7)
41.8
20.5
(22.7)
(11.1)
Total
36.6
11.9
(0.2)
(7.5)
40.8
20.0
3.5
1.8
Total
39.1
10.9
(0.1)
(5.7)
44.2
21.7
(19.1)
(9.3)
As at 31 December 2023, all assets and liabilities with a non-controlling interest are designated as held for sale (Note 11). Due to the availability
of a valuation completed by independent external experts, non-controlling interest for Hudson was stated at fair value on acquisition
(30 October 2023). After initial recognition, the option of measuring non-controlling interest at fair value is no longer available. All other
non-controlling interests are measured at the non-controlling interest’s share of the identifiable assets purchased and liabilities assumed.
15. Disposals
There were no disposals in the year ended 31 December 2023.
In the year ended 31 December 2022, the Group disposed of its investment in its associate Analytic Index, resulting in a gain on disposal
within discontinued operations of £5.0m, and of the assets and liabilities of Retail Week and World Retail Congress (“RWRC”) resulting in
a gain on disposal within continuing operations of £1.0m, included in Non-trading items within Adjusting items (Note 6).
168
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued 16.
Intangible assets and goodwill
(£ million)
Cost
At 1 January 2022
Additions
Acquisitions of businesses
Disposals
Exchange rate differences
At 1 January 2023
Additions
Acquisitions of businesses
Disposals
Transfer to assets held for sale
Exchange rate differences
At 31 December 2023
Accumulated amortisation & impairment
At 1 January 2022
Amortisation
Disposals
Impairment
Exchange rate differences
At 1 January 2023
Amortisation
Disposals
Transfer to assets held for sale
Impairment
Exchange rate differences
At 31 December 2023
Net book value
At 31 December 2023
At 31 December 2022
Acquired Intangibles
Goodwill
Brands
Customer
relationships
Content Technology
Software
Total
844.3
131.1
210.3
59.0
–
59.7
–
47.8
951.8
–
5.4
–
(744.8)
(11.0)
201.4
(240.7)
–
–
–
–
(240.7)
–
–
174.1
–
–
–
2.3
–
2.3
135.7
–
0.3
–
(41.9)
(1.2)
92.9
(55.0)
(7.7)
–
–
(0.3)
(63.0)
(6.9)
–
36.0
(7.5)
1.1
(66.6)
(40.3)
134.8
711.1
52.6
72.7
–
9.9
–
14.3
234.5
–
2.7
–
(211.3)
(1.9)
24.0
(65.2)
(20.1)
–
(43.6)
(0.9)
(129.8)
(14.1)
–
131.5
(4.2)
1.1
(15.5)
8.5
104.7
51.9
–
7.5
–
2.6
87.0
33.3
–
(8.1)
6.1
1,383.6
33.3
79.4
(8.1)
73.1
–
–
–
–
59.0
62.0
118.3
1,561.3
–
1.6
–
(36.9)
–
23.7
(56.2)
(1.9)
–
–
–
(58.1)
(1.1)
–
36.9
–
–
(22.3)
1.4
0.9
–
–
–
(60.5)
(0.4)
1.1
(33.7)
(4.9)
–
–
(0.7)
(39.3)
(5.5)
–
42.6
–
1.1
(1.1)
–
22.7
33.1
0.1
(0.6)
33.1
10.1
(0.6)
(125.6)
(1,221.0)
(3.8)
21.5
(53.9)
(15.5)
7.7
(13.4)
(1.8)
(76.9)
(13.7)
0.6
73.9
–
1.7
(18.3)
364.6
(504.7)
(50.1)
7.7
(57.0)
(3.7)
(607.8)
(41.3)
0.6
495.0
(11.7)
5.0
(14.4)
(160.2)
7.1
41.4
204.4
953.5
Included within software intangible assets at 31 December 2023 is £1.4m (2022: £16.2m) of assets under construction which were not yet
being amortised at the year end.
Impairment review
During the year, the Group recognised an impairment charge of £11.7m which was primarily driven by the impairment of brand
intangibles assets within the Digital Commerce segment, following the decision to rebrand Digital Commerce entities under the
Flywheel brand.
At 31 December 2023, the Group had £197.3m of goodwill and intangible assets acquired through acquisitions (2022: £912.1m). Where
each of the Group’s cash-generating units (CGUs) contain goodwill, indefinite life intangible assets or assets not yet available for use,
these are assessed for impairment annually and more frequently where there are indicators of impairment. Where a CGU only contains
finite life intangible assets a test for impairment is only performed when an impairment trigger is deemed to exist. In assessing for
impairment, an estimate of the CGU’s recoverable amount is determined. The recoverable amount is the higher of value-in-use or fair
value less costs of disposal.
169
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 16.
Intangible assets and goodwill continued
CGUs
As of 31 December 2023, the continuing operations consisted of five individual CGUs: Lions, WARC, Money20/20, Acuity and
Contagious. As outlined in Note 11, the Product Design CGU and Digital Commerce group of CGUs were reclassified as held for sale
during the year. No impairment indicators were identified on classifying these CGUs as held for sale and profits on disposal were
subsequently recognised for each disposal (see Note 31).
No CGU or group of CGUs is larger than an operating segment as defined by IFRS 8 “Operating Segments” before aggregation.
Determination of recoverable amount
When testing for impairment, recoverable amounts for all of the Group’s continuing CGUs are measured at their value-in-use by
discounting the future expected cash flows from the assets in the CGUs. These calculations use cash flow projections based on
Board-approved budgets and approved plans, which have been prepared after considering the expected market, economic conditions
and territories in which each business operates, as well as taking account of the Group’s historic performance. Five-year cash flow
forecasts have been used for all CGUs.
Fair value less costs of disposal is also considered as an alternative measure of recoverable amount based on revenue or EBITDA
multiples compared to recent market transactions. This is a Level 3 measurement, based on inputs which are normally unobservable
to market participants.
The key assumptions and estimates used for value-in-use calculations are as follows:
Long-term growth rate
In calculating the terminal value, cash flows beyond the plan period were extrapolated using a long-term growth rate of 2.1% (2022: 3.0%).
This is in line with the IMF World Economic Outlook published in October 2023, which represents the long-term rates of inflation
expected in the economies in which we operate and the Group’s best estimate of cash flow growth beyond the relevant plan period.
Discount rates
Inputs include risk-adjusted, pre-tax discount rates, calculated by reference to the weighted average cost of capital for each CGU,
weighted to the country, or countries, in which the CGU operates. Movements in the pre-tax discount rates for CGUs since the year
ended 31 December 2022 are primarily driven by increases to the risk-free rate in 2023.
The pre-tax discount rates applied to the risk-adjusted cash flow forecasts and the carrying values of goodwill and other acquired
intangible assets allocated to the CGUs tested for impairment at 31 December 2023 are set out below:
CGU
Marketing
Lions
WARC
Acuity
Contagious
Financial Technology
Money20/20
Digital Commerce
Product Design
Total
2023
2022
Pre-tax discount
rate %
Goodwill
Acquired
Intangibles
Pre-tax discount
rate %
Goodwill
Acquired
Intangibles
13.8%
13.8%
13.9%
n/a
14.6%
n/a
n/a
81.1
10.6
–
5.4
37.7
n/a
n/a
134.8
50.2
4.8
1.9
4.3
1.3
n/a
n/a
62.5
12.8%
13.2%
13.9%
–
16.0%
14.9%
13.4%
81.4
10.6
–
–
39.7
423.4
156.0
711.1
53.6
6.9
2.4
–
3.5
132.0
2.6
201.0
Sensitivity to changes in assumptions
The calculation of value-in-use is most sensitive to the discount rate and long-term growth rates used. The Group has concluded that the
headroom calculated was not significantly impacted by a reasonably possible change in these inputs.
170
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued 17. Property, plant and equipment
(£ million)
Cost
At 1 January 2022
Additions
Acquisitions of businesses
Disposals
Movements in exchange rates
At 1 January 2023
Additions
Transfer to assets held for sale
Disposals
Movements in exchange rates
At 31 December 2023
Depreciation
At 1 January 2022
Depreciation
Disposals
Movements in exchange rates
At 1 January 2023
Depreciation
Transfer to assets held for sale
Disposals
Movements in exchange rates
At 31 December 2023
Net book value
At 31 December 2023
At 31 December 2022
Hardware and
Fixtures &
Fittings
Leasehold
9.9
1.2
–
–
0.4
11.5
1.1
(7.4)
(0.4)
(0.3)
4.5
(8.3)
(1.4)
–
(0.2)
(9.9)
(0.8)
5.3
0.7
0.2
(4.5)
–
1.6
13.5
1.6
0.3
(0.3)
0.5
15.6
3.5
(14.3)
(1.5)
(0.5)
2.8
(9.8)
(1.8)
0.3
(0.2)
(11.5)
(2.4)
10.9
0.7
0.1
(2.2)
0.6
4.1
Total
23.4
2.8
0.3
(0.3)
0.9
27.1
4.6
(21.7)
(1.9)
(0.8)
7.3
(18.1)
(3.2)
0.3
(0.4)
(21.4)
(3.2)
16.2
1.4
0.3
(6.7)
0.6
5.7
171
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 18.
Investments
(£ million)
At 1 January
Acquisition of investments
Remeasurement of trade investments to fair value
Share of the loss of associates
Disposal of investments in Hudson to MTII February 2023 (Note 30)
Conversion of investment in Hudson to debt instruments February 2023 (Note 30)
Derecognition of investment in Hudson upon recognition as subsidiary October 2023 (Note 30)
Movement in exchange rates
Transfers to assets held for sale (Note 11)
At 31 December
Investments as at 31 December were made up as follows:
(£ million)
Trade investments and preference shares measured at fair value through profit or loss
Associates accounted for using the equity method
At 31 December
19. Trade and other receivables
(£ million)
Non-current
Other receivables
Total non-current
Current
Trade receivables, net of the allowance for doubtful debts
Other receivables
Prepayments
Contract assets – accrued income
Total current
Total
2023
88.5
3.6
0.9
(13.3)
(24.9)
(33.2)
(4.0)
(0.7)
(15.2)
1.7
2023
1.7
–
1.7
2023
–
–
29.6
2.8
16.2
0.6
49.2
49.2
2022
82.2
4.0
(4.0)
(3.2)
–
–
–
(0.4)
9.9
88.5
2022
85.1
3.4
88.5
2022
42.7
42.7
112.1
204.8
9.6
18.4
344.9
387.6
The Directors consider that the carrying amount of receivables and prepayments approximates their fair value.
Trade receivables are non-interest bearing and are shown net of an allowance for doubtful debts. As at 31 December 2023, the allowance
for doubtful debts was £0.2m (2022: £7.9m). Movements in the allowance for doubtful debts were as follows:
(£ million)
At 1 January
Provided in the year
Released in the year
Utilised in the year
FX movements
Business acquisitions
Transfer to held for sale
At 31 December
2023
7.9
3.6
(1.1)
(1.5)
–
–
(8.7)
0.2
2022
4.4
7.6
(1.8)
(3.4)
1.0
0.1
–
7.9
Continuing operations net impairment loss on trade receivables and contract assets recognised in the year of £nil (2022: £0.2m) is the
net of the total amounts provided in the year of £0.2m (2022: £0.4m) in trade receivables, offset by the amount released in the year of
£0.2m (2022: £0.2m) in trade receivables.
172
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued Trade receivables and contract assets of continuing operations, net of the allowance for doubtful debts, are aged as follows:
(£ million)
Current (not past due)
1-30 days past due
31–90 days overdue
More than 90 days past due
At 31 December 2023
Current (not past due)
1-30 days past due
31–90 days overdue
More than 90 days past due
At 31 December 2022
Loss rate
Gross carrying
amount
Loss allowance
Credit note
allowance
Net trade
receivables and
contract assets
0.0%
0.0%
0.0%
15.1%
0.8%
2.9%
7.8%
49.9%
14.5
13.7
1.6
0.6
30.4
103.9
16.0
8.3
11.8
140.0
–
–
–
(0.2)
(0.2)
(0.8)
(0.5)
(0.7)
(5.9)
(7.9)
–
–
–
–
–
(1.6)
–
–
–
(1.6)
14.5
13.7
1.6
0.4
30.2
101.5
15.5
7.6
5.9
130.5
Loss rates are calculated based on actual credit losses over the past three years and adjusted to reflect differences between the historical
credit losses and the Group’s view of the economic conditions over the expected lives of the receivables. In addition to the loss
allowance, there is a credit note allowance of £nil (2022: £1.6m) in the net trade receivables balance.
The maximum exposure to credit risk for trade receivables and contract assets by geographical region was:
(£ million)
United Kingdom
Other Europe
United States and Canada
China
Asia Pacific excluding China
Middle East and Africa
Latin America
Total
2023
5.7
5.1
16.8
0.1
1.6
0.5
0.4
30.2
2022
11.6
17.3
69.3
13.9
11.8
1.3
5.3
130.5
As at 31 December 2023, the allowance for doubtful debts was £nil (2022: £0.8m) for other receivables. In 2023 the amounts due from
external suppliers in relation to pass-through costs were transferred to held for sale (Note 11). Other receivables, net of the allowance for
doubtful debts, are aged as follows:
(£ million)
Not past due
1-30 days past due
31–90 days overdue
More than 90 days past due
Total
Non-current
–
–
–
–
–
2023
Current
2.8
–
–
–
2.8
2022
Non-current
Current
42.7
–
–
–
42.7
146.9
22.3
19.3
16.3
204.8
Total
2.8
–
–
–
2.8
Total
189.6
22.3
19.3
16.3
247.5
173
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 20. Trade and other payables
(£ million)
Current
Trade payables
Other payables
Accruals
Interest accruals
Taxes and social security costs
Total
2023
11.8
4.9
56.8
1.1
5.9
80.5
2022
18.0
203.5
48.1
0.9
7.1
277.6
In 2022, other payables included amounts due to external suppliers in relation to pass-through costs of £193.7m. Pass-through costs
comprise amounts paid to external media suppliers which are charged directly to clients. The amounts due from customers in these
relationships were recognised in other receivables (see Note 19). In 2023 the amounts due to external suppliers in relation to pass-through
costs were transferred to held for sale (Note 11).
As at 31 December 2023, £34.1m of accruals were for services incurred for separation activities.
21. Deferred and contingent consideration
The Group has liabilities in respect of deferred and contingent consideration payments under various business acquisition contracts as
set out in the table below:
(£ million)
At 1 January 2022
Additions
Acquisition–related employment costs accrued in the year
Revaluation of contingent consideration recognised
Discounting of contingent and deferred consideration
Acquisition–related employment costs cash paid in year
Deferred and contingent consideration cash paid in the year
Movements in exchange rates
At 1 January 2023
Additions
Acquisition–related employment costs accrued in the year
Revaluation of contingent consideration recognised
Discounting of contingent and deferred consideration
Acquisition–related employment costs cash paid in year
Deferred and contingent consideration cash paid in the year
Movements in exchange rates
Transfer to held for sale
At 31 December 2023
Note
30
Total
102.9
12.3
30.5
1.0
10.3
(19.5)
(37.9)
8.5
108.1
67.9
14.2
(16.0)
5.4
(42.5)
(27.1)
(8.5)
(35.8)
65.7
Level 3
72.0
12.3
–
0.7
10.3
–
(35.5)
7.0
66.8
67.9
–
(16.2)
5.4
–
(27.1)
(5.8)
(25.3)
65.7
Deferred and contingent consideration additions in the year related to Hudson MX and arose on the anticipated exercise of the MTII put
option over their common stock in April 2024 and the expected assumption by Ascential of the series A preference shares (Note 30).
174
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued 22. Borrowings
During the year, the Group had a multi-currency revolving credit facility (’RCF’) of £450m with a syndicate of lenders, plus an accordion
to raise further debt amounts, at the options of the lenders, of up to the greater of £120m or 150% of EBITDA. This facility was available
until January 2025 and the RCF could be drawn in tranches for each interest rate period. These tranches of debt could be rolled over at
the end of the interest period subject to covenant compliance on the request date. The Group was in compliance with covenants
throughout the year.
At 31 December 2023, the borrowings were subject to interest at a margin of 1.60% over the relevant currency interest rate benchmarks.
The facility covenants included a maximum net leverage of 3.25x with the benefit of additional 0.5x leverage spikes for relevant
acquisitions and a minimum interest cover of 3.00x and were tested semi-annually.
At 31 December 2023, the maturity profile of the Group’s borrowings, which consisted entirely of the RCF, was as follows:
(£ million)
Non-current
One to two years
Two to five years
Total borrowings
2023
2022
411.6
–
411.6
–
301.2
301.2
Borrowings are shown net of unamortised issue costs of £0.8m (2022: £1.6m). The carrying amounts of borrowings approximate their fair
value as detailed in Note 29. The Group’s borrowings at 31 December 2023 were denominated in Pounds Sterling, US Dollars and Euros
amounting to £77.0m, $311.0m and €105.0m respectively (2022: $233.0m and €124.5m).
On 19 December 2023, the Group signed a new four-year multi-currency revolving credit facility (“RCF”) of £225.0m with an accordion of
up to a further £75.0m or 100% of EBITDA. The Group can request a further one-year extension to the facility at the option of individual
lenders. The RCF became effective on 8 January 2024 following the repayment of the previous RCF Facility and the disposal of the Digital
Commerce business on 2 January 2024. The new RCF is subject to interest of between 2.05% and 3.25% per annum over SONIA, EURIBOR
or US Dollar SOFR. The margin increases over a range of 1.00x to 3.00x net debt to EBITDA. The facility covenants include a maximum net
leverage of 3.00x and a minimum interest cover of 3.00x and are tested semi-annually. Upon completion of the new agreement,
capitalised arrangement fees of £0.8m relating to the previous facility will be written off in 2024 as an Adjusting finance cost. We expect
fees of £2.9m to be capitalised as part of the new arrangements and these shall be amortised over the expected life of the facility.
Reconciliation of movement in Net Debt
(£ million)
At 1 January 2022
Exchange differences
Proceeds from external borrowings
Repayment of external borrowings
Fair value movement
Amortisation of debt arrangement fees
Net cash movement
At 1 January 2023
Exchange differences
Proceeds from external borrowings
Repayment of external borrowings
Fair value movement
Net interest accrued
Amortisation of debt arrangement fees
Net cash movement
At 31 December 2023
Cash**
Cash in transit
Short–term
deposits
Derivatives
Borrowings
Net debt*
55.7
5.5
–
–
–
–
(2.2)
59.0
(2.6)
–
–
–
–
–
16.1
72.5
0.4
28.0
–
–
–
–
–
0.5
0.9
–
–
–
–
–
–
–
–
–
–
–
(7.9)
20.1
–
–
–
–
–
–
(0.3)
0.6
(6.7)
13.4
0.2
–
–
–
4.3
–
–
4.5
–
–
–
1.5
4.0
–
(3.0)
7.0
(158.1)
(19.3)
(176.8)
53.8
–
(0.8)
–
(301.2)
13.0
(170.1)
47.5
–
–
(0.8)
–
(411.6)
(73.8)
(13.8)
(176.8)
53.8
4.3
(0.8)
(9.6)
(216.7)
10.4
(170.1)
47.5
1.5
4.0
(0.8)
6.1
(318.1)
* Refer to the Glossary of Alternative Performance Measures for the definition of Net Debt
** Includes £47.1m of cash classified as held for sale (including restricted cash) as at 31 December 2023
Cash and cash equivalents at 31 December 2023 of £86.5m (2022: £80.0m) relate to bank balances, including short-term deposits with an
original maturity date of less than three months, and cash in transit.
175
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 23. Provisions
(£ million)
At 1 January 2022
Provided in the year
Released in the year
Utilised in the year
At 1 January 2023
Provided in the year
Released in the year
Utilised in the year
Discounting of provisions
Transfer to held for sale
At 31 December 2023
Property
provisions
Restructuring
provisions
Legal and
Other
Total
provisions
3.0
3.5
(2.6)
(0.4)
3.5
1.8
(0.7)
(1.5)
0.1
(0.3)
2.9
–
–
–
–
–
4.2
–
–
–
–
4.2
0.9
–
(0.2)
(0.2)
0.5
0.1
(0.4)
–
–
–
0.2
3.9
3.5
(2.8)
(0.6)
4.0
6.1
(1.1)
(1.5)
0.1
(0.3)
7.3
Provisions have been analysed between current and non-current as follows:
(£ million)
Current
Non-current
Total
2023
2022
Property
provisions
Restructuring
provisions
Legal and
other
Total
provisions
Property
provisions
Restructuring
provisions
Legal and
other
Total
provisions
1.0
1.9
2.9
4.2
–
4.2
0.2
–
0.2
5.4
1.9
7.3
1.5
2.0
3.5
–
–
–
0.5
–
0.5
2.0
2.0
4.0
The property provisions recognised relate to dilapidation costs on property leases in the United Kingdom and Republic of Ireland and to
onerous property costs on property leases in the United Kingdom, Republic of Ireland and United States. The restructuring provisions
relate to redundancy costs for the restructuring of the corporate centre.
Legal and other provisions mainly comprise amounts provided against open legal and contractual disputes arising in the normal course
of business. Provisions are made for the expected costs associated with such matters, taking into account professional advice received,
and represent management’s best estimate of the most likely outcome. No provision is made for proceedings which have been or might
be brought by other parties against the Group unless management, taking into account professional advice received, assesses that it is
probable that such proceedings may be successful. Contingent liabilities associated with such proceedings have been identified, but the
Directors are of the opinion that any associated claims that might be brought can be defeated successfully and, therefore, the possibility
of any material settlement outflow is assessed as remote.
The weighted average maturity of property provisions is approximately four years. The average weighted maturity of restructuring and
legal and other provisions is approximately one year.
24. Share capital and reserves
Share capital
(£ million)
444,765,441 Ordinary shares of £0.01 each (2022: 440,212,104)
Total
2023
4.4
4.4
2022
4.4
4.4
During the year, 4,553,337 new shares were issued; 4,303,500 (2022: 921,655) and 249,837 (2022: 75,748) ordinary £0.01 shares were issued
to Employee Benefit Trusts (Offshore EBT and UK SIP EBT) and employees respectively under employee share schemes. This results in an
increase in share premium of £0.5m (2022: £0.3m).
Share premium
The share premium account comprises the premium on allotment of shares.
Translation reserve
The translation reserve arises on the translation into Pounds Sterling of the net assets of the Group’s foreign operations.
176
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued Other reserves
(£ million)
At 1 January 2022
Shares purchased
Shares issued to employees
At 1 January 2023
Shares purchased
Shares issued to employees
At 31 December 2023
Attributable to owners of the Company
Group
restructure
reserve Merger reserve
Treasury share
reserve
157.9
–
–
157.9
–
–
157.9
9.2
–
–
9.2
–
–
9.2
(0.1)
(3.7)
2.7
(1.1)
(6.7)
6.5
(1.3)
Total
167.0
(3.7)
2.7
166.0
(6.7)
6.5
165.8
The group restructure reserve arose from the IPO restructuring of the Group between 8 and 12 February 2016. A merger reserve was
recognised, reflecting the difference between the share capital and share premium of the Company on 8 February 2016, and the share
capital, share premium and non-distributable reserves of the previous Parent of the Group at the same date.
Shares held by Employee Benefit Trusts (UK SIP EBT and Offshore EBT) established for settlement of awards granted under employee
share schemes are classified as Treasury shares and held within the Treasury Share Reserve. As at 31 December 2023 3,760,211 shares
(2022: 1,073,519) were held in the Employee Benefit Trusts at a cost of £1.3m (2022: £1.1m). The market value of these shares was £11.0m
(2022: £2.2m).
During the year, the Offshore EBT purchased 2,671,777 (2022: 1,432,000) shares at a cost of £6.7m, with an average price of £2.48 per
share, to issue employees free of cost shares under PSP, RSP, DABP, and International SIP.
25. Subsidiary and related undertakings
Full details of the subsidiaries and joint ventures of Ascential plc at 31 December 2023 are set out in Note 6 to the parent Company
financial statements.
26. Related party transactions
The aggregate value of transactions and outstanding balances with related party entities are as follows:
(£ million)
Asian Advertising Festival (Spikes Asia) Pte Limited (50% owned)
Profit share
Recharged costs
Shanghai Coloro Technology Co. Limited (27% owned)
Share of profit/(loss)
Purchase of inventories
Hudson MX Inc (36.8% owned)*
Share of losses
Loan receivable
Interest receivable
Provision of other secondee services
Payroll services
*
Is a related party during the first 10 months of the year.
Transaction value
Balance outstanding at
31–Dec
2023
2022
2023
2022
0.6
0.3
(0.1)
(1.2)
(13.2)
–
–
0.3
2.0
0.7
0.1
0.4
(1.5)
(2.7)
–
3.1
2.7
–
–
–
–
–
–
–
(0.3)
(0.1)
–
–
–
–
–
–
39.7
3.0
0.7
–
Other than the compensation of key management personnel, set out in Note 7, there are no other related party transactions requiring
disclosure under IAS 24 “Related Party Disclosures”. All related party transactions occurring during the year were made on market terms.
177
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 27. Leases
A. Leases as lessee
The Group leases commercial office space.
Right-of-use assets
a.
Right-of-use assets are presented as a separate line item on the statement of financial position and tabulated below.
(£ million)
Cost
At 1 January 2022
Additions
Derecognition of right-of-use assets
Movements in exchange rates
At 1 January 2023
Additions
Derecognition of right-of-use assets
Transferred to held for sale
Movements in exchange rates
At 31 December 2023
Depreciation
At 1 January 2022
Depreciation
Impairment
Derecognition of right-of-use assets
Movements in exchange rates
At 1 January 2023
Depreciation
Impairment
Derecognition of right-of-use assets
Transferred to held for sale
Movements in exchange rates
At 31 December 2023
Net book value
At 31 December 2023
At 31 December 2022
Right of use
assets
56.1
5.5
(24.8)
2.5
39.3
1.9
(8.6)
(21.0)
0.5
12.1
(34.3)
(7.0)
(2.9)
24.8
0.1
(19.3)
(5.3)
(1.1)
4.4
12.1
(1.3)
(10.5)
1.6
20.0
Extension options
b.
Some property leases contain extension options after the non-cancellable contract period. The Group assesses at lease commencement
date whether it is reasonably certain to exercise these options, and if so, the optional period is included within the lease term and
therefore the calculation of the lease liability. The Group reassesses whether it is reasonably certain to exercise the options if there is a
significant event or significant changes in circumstances within its control.
The Group has estimated that the potential future lease payments, should it exercise all the extension options, would result in an increase
in lease liability of £9.5m (2022: £18.3m).
Short-term leases
c.
The total cost of short-term leases, where the initial term of the lease was 12 months or less, was £264,000 (2022: £48,000).
178
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued B. Leases as lessor
The Group recognises the net investment in sub-leases within right-of-use assets. The following table sets out a maturity analysis of the
lease receivables, showing the undiscounted lease payments to be received after the reporting date:
(£ million)
Less than one year
One to two years
Three to five years
More than five years
Total undiscounted leases receivable
Unearned finance income
Net investment in the leases
2023
1.0
2.0
2.0
0.1
5.1
(0.8)
4.3
2022
0.5
0.3
–
–
0.8
(0.1)
0.7
The net investment in the lease is presented within investment property in the statement of financial position. The following presents the
reconciliation of the investment property:
(£ million)
Balance at 1 January
Additions
Payments
Interest
FX
Balance at 31 December
C. Lease liabilities
The Group has lease liabilities of £10.9m (2022: £26.8m) with movements comprising as follows:
(£ million)
At 1 January 2022
Payments
Additions
Discount unwind
De-recognition of lease liability
Movements in exchange rates
At 1 January 2023
Payments
Additions
Discount unwind
Movements in exchange rates
Transferred to held for sale
At 31 December 2023
28. Commitments and contingencies
Capital and contractual commitments for event space at 31 December are detailed below.
(£ million)
Assets under construction
Contractual commitments for event space
Balance at 31 December
2023
0.1
19.7
19.8
2023
0.7
4.2
(0.6)
0.1
(0.1)
4.3
2022
0.6
0.7
(0.7)
0.1
–
0.7
Lease liabilities
25.2
(8.0)
5.5
1.1
(0.1)
3.1
26.8
(8.8)
3.5
1.0
(1.2)
(10.4)
10.9
2022
0.3
9.9
10.2
179
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 29. Financial instruments and financial risk management
Information about the Group’s objectives, policies and processes for measuring and managing risk, the Group’s exposure to the risks
arising from financial instruments, and the Group’s management of capital is disclosed below.
Foreign exchange risk
A. Market risk
a.
The Group operates internationally and is exposed to foreign exchange risk arising from various currency exposures, primarily with
respect to the US Dollar and the Euro. Foreign exchange risk arises from future commercial transactions to which the Group is already
committed, recognised assets and liabilities and net investments in foreign operations.
Foreign currency movements impact on the consolidated statement of profit or loss together with its cash flow profile and leverage ratio
position. The impact depends on whether there is a surplus or deficit in each currency from operating activities together with the
interest and finance charge in those currencies. The Group’s policy is to protect its cash flow and leverage ratio position by maintaining a
proportion of currency debt in proportion to its currency earnings to obtain natural offsets.
Net Debt by currency was as follows:
Pounds Sterling
US Dollars
Euros
Other currencies
Total
2023
Cash and
borrowings
(62.3)
(200.5)
(79.7)
17.4
(325.1)
Derivatives
–
6.2
0.8
–
7.0
Total
(62.3)
(194.3)
(78.9)
17.4
(318.1)
Derivatives
–
1.8
2.7
–
4.5
2022
Cash and
borrowings
12.2
(152.7)
(100.0)
19.3
(221.2)
Total
12.2
(150.9)
(97.3)
19.3
(216.7)
The Group’s cash is subject to foreign exchange movements, a 1% movement in the US Dollar to Pounds Sterling exchange rate would
give rise to a £0.4m increase/decrease in the carrying value of cash balances, a 1% movement in the Euro to Pounds Sterling exchange
rate would give rise to a £0.1m increase/decrease in the carrying value of the cash balance and a 1% movement in Chinese Yuan to
Pounds Sterling exchange rate would give rise to a £0.1m increase/decrease in the carrying value of the cash balances.
Each 1% movement in the Euro to Pounds Sterling exchange rate has a circa £0.9m (2022: £1.1m) impact on the carrying value of
borrowings. Each 1% movement in the US Dollar to Pounds Sterling exchange rate has a circa £2.4m (2022: £1.9m) impact on the carrying
value of borrowings.
For illustrative purposes, the table below provides details of the impact on revenue and Adjusted EBITDA, from continued operations,
if the actual reported results were restated for Pounds Sterling weakening by 1% against the US Dollar and Euro rates in isolation:
(£ million)
Increase in revenue/Adjusted EBITDA if:
2023
Revenue
2023
Adjusted EBITDA
2022 Revenue
(restated*)
2022 Adjusted
EBITDA
(restated*)
Pounds Sterling weakens by 1% against US Dollar in isolation
Pounds Sterling weakens by 1% against Euro in isolation
0.7
1.3
0.4
0.9
0.7
1.0
0.4
0.8
*
restated to show amounts relating to continued operations
The Group has entered into a net investment hedge to hedge $390m from USD to GBP against the net assets of US subsidiaries held for
sale to mitigate foreign exchange risk. The fair value of the net investment hedge as at 31 December 2023 was £5.8m (2022: £nil).
These net investment hedge derivatives are measured at fair value through other comprehensive income and are Level 2 financial
instruments. These derivative instruments were not traded in an active market and the fair value is determined by using third-party
valuations based on forward yield curves. This technique maximises the use of observable market data where it is available and relies as
little as possible on entity specific estimates. All significant inputs required to fair value an instrument are observable.
The net investment hedge was assessed to be highly effective at 31 December 2023.
180
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued b. Cash flow and interest rate risk
Interest rate risk arises from borrowings to the extent that the underlying debt instruments are not at fixed rates of interest.
The Group has entered into interest rate caps to convert a portion of its bank borrowings from fully floating to capped rates to mitigate
this risk. As at 31 December 2023, the total notional amount of outstanding interest rate caps to which the Group is committed is £208.7m
(2022: £215.4m). The fair value of the interest rate caps as at 31 December 2023 was £1.2m (2022: £4.5m).
These interest rate caps are measured at fair value through profit or loss and are Level 2 financial instruments. These derivative
instruments were not traded in an active market and the fair value is determined by using third-party valuations based on forward yield
curves. This technique maximises the use of observable market data where it is available and relies as little as possible on entity specific
estimates. All significant inputs required to fair value an instrument are observable.
In the year ended 31 December 2023, if interest rates had been 50 basis points higher or lower and all other variables were held constant,
the Group’s finance costs for the year ended 31 December 2023 would have increased or decreased by £1.7m (2022: £1.5m).
The effective annual interest rate for the year ended 31 December 2023 was 6.5% (2022: 3.9%).
B. Credit risk
Credit risk is managed on a Group basis. Credit risk arises from cash and cash equivalents, derivative financial instruments and deposits
with banks and financial institutions, as well as credit exposures to customers, including outstanding receivables and committed
transactions. The maximum exposure to credit risk at the reporting date is the fair value of the financial assets in the consolidated
statement of financial position as disclosed below.
Treasury-related credit risk
a.
The Group has treasury policies in place which manage the concentration of risk with individual bank counterparties. Each counterparty
has an individual limit determined by their long-term and short-term ratings by Standard & Poor’s or Moody’s. As at 31 December 2023,
cash and cash equivalents totalled £86.5m (2022: £80.0m), of which 91% (2022: 86%) was held with banks or financial institutions with
long-term ratings of A-/A3 or better or short-term ratings of A-1/P-1.
In accordance with the Group’s treasury policies and exposure management practices, counterparty credit exposure limits are monitored
and no individual exposure is considered significant in the ordinary course of treasury management activity. The Group does not expect
any significant losses from non-performance by these counterparties.
Trading risk
b.
Risk arises principally from payment default by customers. The general policy of the Group is not to risk assess all new customers and so
retail credit risk information has not been included in these consolidated financial statements. The Group does not, however, expect any
significant losses in respect of receivables that have not been provided for as shown in Note 19.
C. Liquidity risk
Liquidity risk is the risk that the Group will not be able to meet its financial obligations as they fall due. The Group’s approach to managing
liquidity is to ensure, as far as possible, that it will always have sufficient liquidity in the form of sufficient cash or funding from adequate
credit facilities to meet such liabilities under both normal and stressed conditions. The Group’s major banking facilities in place as of 31
December 2023 consisted of a £450m 5-year multi-currency revolving credit facility drawn in a combination of Pounds Sterling, Euro and
US Dollar currencies that carried interest rates of IBOR +1.60% (2022: IBOR +1.6%) and matured in January 2025. At 31 December 2023, the
Group had drawn £412.4m of the facility across the following currencies: £77.0m, €105.1m (£91.1m) and $311.0m (£244.3m) of the facility
(2022: drawn down £302.8m across €233.0 (£192.6m) and $124.5m (£110.2m)). These facilities were repaid with the proceeds of the sale
of our Digital Commerce business in January 2024 and replaced with a new facility (see Notes 22 and 31).
The Group’s external borrowings presented in Note 22 of £411.6m (2022: £301.2m) are shown net of unamortised issue costs of £0.8m
(2022: £1.6m).
The Group’s undrawn borrowings total £37.6m (2022: £147.2m) and represented the unutilised balance on the revolving credit facility
which was repaid in January 2024.
The Group assessed the concentration of risk with respect to refinancing its newly arranged debt and concluded it to be low. The Group
has access to a sufficient variety of sources of funding and ability to roll over debt with its existing syndicate of lenders.
181
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 29. Financial instruments and financial risk management continued
The following is an analysis of the contractual undiscounted cash flows payable under financial and derivative assets/(liabilities). Amounts
classified as held for sale are expected to be transferred out of the Group within one year and as such are not included in the below
analysis:
(£ million)
At 31 December 2023
Non-derivative financial liabilities
Borrowings
Interest payments on borrowings
Trade payables and other payables
Lease liabilities
Deferred and contingent consideration
Derivative financial assets
Derivative contracts – receipts
Total
At 31 December 2022 (restated*)
Non-derivative financial liabilities
Borrowings
Interest payments on borrowings
Trade payables and other payables
Lease liabilities
Deferred and contingent consideration
Derivative financial assets
Derivative contracts – receipts
Total
Less than
one month
Between
one and
three
months
Between
three and 12
months
In one to
two years
In two to
five years
In more than
five years
Total
–
(2.2)
(80.5)
(0.1)
–
7.0
(75.8)
–
(1.3)
(39.7)
(0.2)
–
0.5
(40.7)
–
(4.6)
–
(0.4)
–
–
(20.6)
–
(1.9)
(66.9)
–
–
(412.4)
–
–
–
–
–
–
–
–
(2.5)
(6.7)
(0.6)
–
–
–
–
–
–
(5.0)
(89.4)
(414.9)
(6.7)
(0.6)
(592.4)
–
(2.6)
–
(0.7)
–
–
(3.3)
–
(11.6)
–
(2.5)
–
3.0
(11.1)
–
(302.8)
–
–
–
–
–
(6.9)
(2.8)
–
–
–
–
(15.4)
–
(2.6)
–
1.0
(17.0)
(309.7)
(2.8)
(384.6)
(412.4)
(27.4)
(80.5)
(12.2)
(66.9)
7.0
(302.8)
(30.9)
(39.7)
(15.7)
–
–
4.5
* Restated for held for sale assets and liabilities, refer to Note 11 for further detail.
The financial and derivative instruments are shown in the period in which they are due to be repaid. The interest payments on
borrowings due in less than one month represents the actual interest due, while the interest due greater than one month is an estimate
based on current interest rates and exchange rates. Cash flows in respect of borrowings represent contractual payments under the
Group’s lending facilities in place as at 31 December 2023. Borrowings, as disclosed in Note 22, are stated net of unamortised
arrangement fees of £0.8m as at 31 December 2023 (2022: £1.6m).
Contingent consideration is based on the future performance of the acquired business to which they relate. Performance is assessed
using forecast revenue and profits from the current five-year plan which is updated annually. Forecasts are inherently a source of
management estimation, resulting in a range of outcomes. Contingent consideration related to the Digital Commerce segment and the
outstanding liability is classified as held for sale as at 31 December 2023. Deferred consideration of £65.7m arising in the year relates to
the anticipated exercise of the MTII put option over their common stock in April 2024 and the expected transfer to Ascential of the series
A preference shares (see Note 30).
Undiscounted future payments (£ million)
Contingent consideration
Acquisition-related employment costs to the extent to which they are accrued at 31 December
Deferred consideration which is not impacted by performance
Deferred and contingent consideration
Anticipated future payments on acquisition-related employment costs
Deferred and contingent consideration including anticipated future payments on acquisition-related
employment costs
2023
–
–
66.9
66.9
–
66.9
2022
80.4
40.4
1.2
122.0
24.5
146.5
182
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued D. Capital risk management
The Group manages its capital to ensure that the Group will be able to continue as a going concern while maximising the return to
shareholders through the optimisation of the debt-to-equity balance. The capital structure of the Group consists of debt, cash and cash
equivalents and equity attributable to equity holders of the parent comprising capital, reserves and retained earnings. The Group’s policy
is to borrow centrally to meet anticipated funding requirements. These borrowings, together with cash generated from the operations,
are contributed as equity to subsidiaries or on-lent at market-based interest rates and on commercial terms and conditions.
Financial Instruments
The carrying amount of financial instruments by category is as follows:
(£ million)
Financial assets
Interest in trade investments and preference shares designated at fair value
through profit or loss on initial recognition
Derivatives
Total
Financial liabilities
Deferred and contingent consideration
Borrowings
Total
2023
2022
Note
Carrying
Value
Fair
Value
Carrying
Value
Fair
Value
18
22
21
22
1.7
7.0
8.7
65.7
412.4
478.1
1.7
7.0
8.7
65.7
412.4
478.1
85.1
4.5
89.6
66.8
302.8
369.6
85.1
4.5
89.6
66.8
302.8
369.6
The fair value of each category of the Group’s financial instruments approximates their carrying value in the consolidated statement of
financial position. Financial instruments in the category “fair value through profit or loss” are measured in the consolidated statement of
financial position at fair value. Fair value measurements can be classified in the following hierarchy:
• quoted prices (unadjusted) in active markets for identical assets or liabilities (Level 1);
•
•
inputs other than quoted prices included within Level 1 that are observable for the asset or liability, either directly or indirectly (Level 2); and
inputs for the asset or liability that are not based on observable market data (that is, unobservable inputs) (Level 3).
The following table presents the Group’s assets and liabilities that are measured at fair value at 31 December 2023:
(£ million)
Other investments, including derivatives
Trade investments and preference shares (Note 18)
Deferred and contingent consideration (Note 21)
Borrowings (Note 22)
2023
2022
Level 1
Level 2
Level 3
Total
Level 1
Level 2
Level 3
–
–
–
–
7.0
–
–
412.4
–
1.7
65.7
–
7.0
1.7
65.7
412.4
–
–
–
–
4.5
–
–
–
85.1
66.8
Total
4.5
85.1
66.8
302.8
–
302.8
Level 3 trade investments are valued based on the assumed transaction pricing or the most available sources of information. There were
no movements between different levels of the fair value hierarchy in the year.
183
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 30. Hudson
A. Summary
Ascential has a significant investment in Hudson MX, Inc. (“Hudson”). Two corporate transactions affected the accounting for Hudson
during 2023: a new financing round and capital restructuring in February 2023 and an agreement between Ascential and Hudson’s major
shareholder, MT II Holdings, LP (“MTII”), in October 2023. Prior to these transactions we equity-accounted for our 8% share of common
stock, recording our share of the results of Hudson MX in proportion to our holding.
These corporate transactions resulted in the following accounting outcomes:
• 6 February 2023 to 30 October 2023: We equity-accounted for our 36.5% share of common stock, offsetting any share of losses
against the increased value of the equity-accounted balance arising from the February transaction. Preference stock was classified as
a debt instrument and consequently held at amortised cost and recorded in non-current other receivables.
• 30 October 2023: We judged that we controlled Hudson in accordance with IFRS 10 “Consolidated Financial Statements” and therefore
consolidated our investment. Since Hudson had been acquired exclusively with a view to sell, we immediately presented Hudson as
held for sale and as a discontinued operation.
B. Background
February 2023 financing and capital restructuring
In February 2023, Hudson completed a new financing round and executed a capital restructuring. It resulted in MTII becoming the
majority shareholder in Hudson, holding 51.0% of the fully diluted common equity and Ascential holding a 36.5% interest. The remaining
12.5% was held by Hudson’s management team and existing shareholders and did not carry voting rights. As part of this transaction,
Ascential received £24.9m in cash from MTII for a portion of its preference stock investment (which MTII then converted into common
stock) and we converted our remaining £51.0m of preference stock investment into debt-like instruments (£33.2m) and into common
stock (£17.8m). At the same time, the promissory notes that we previously held were also converted into these debt-like preference shares
and we agreed to provide an additional £17.9m of funding, all of which was provided prior to October 2023. Ascential also agreed
arrangements that provided a potential path to a majority stake in the future. These arrangements included providing MTII with a put
option over 42.5% of their 51.0% stockholding, exercisable by MTII from 1 April 2024 to 31 December 2025 and, if exercised, subject to a
maximum consideration payable by Ascential of US$52m and minimum consideration of between US$38m and US$52m depending on
the time period the option is held for. If the put option was exercised, then Ascential could call the remaining 8.5% equity shares held by
MTII at any time in the subsequent two years. Separately, Ascential established put and call options to potentially acquire the remaining
management and external investors’ shareholdings, totalling 12.5%, exercisable between 2026 and 2028, with the consideration in respect
of exercise of these put options subject to a maximum consideration of US$40m.
October 2023 agreement with MTII
On 30 October 2023, following the Board’s decision that Hudson was not core to the ongoing business of Ascential after the sale of
Digital Commerce, Ascential entered into an agreement with MTII whereby both parties formally agreed to initiate the early sale of
Hudson and, if the business were not sold by April 2024, then Ascential would acquire the business. This included terms where if Hudson
is sold on or prior to 15 April 2024, Ascential would reimburse MTII any difference between MTII’s share of the sales proceeds and the
minimum put and call option exercise price agreed in February 2023 over the sale of MTII common stock (calculated as if this had been
exercised on 1 April 2024 and completed 15 April 2024 and equivalent to £35.5m). If such a sale were to complete, then the MTII preferred
stock would also be purchased at the face value of the financial instrument plus any unpaid interest arising. MTII further agreed that it
would not exercise its put option to sell its common stock to Ascential if a sale of Hudson has been agreed as of 1 April 2024 and likely to
consummate by 15 April 2024.
A new Early Call option was granted to Ascential by this agreement which gives Ascential the right to purchase MTII’s stake in Hudson for
the minimum put and call option consideration amount at any point from 30 October 2023 until 1 April 2024. In the event that this option
remains unexercised or a sale is not completed by 15 April 2024, the put and call options with MTII stipulated in the February 2023
agreement are deemed to be exercised. Ascential would then acquire the MTII common stock and preference shares. In the event that
Hudson requires additional funding in advance of April 2024, and MTII is unable to identify a reasonable source of additional funding to
meet their commitments, Ascential agreed to exercise its new Early Call option.
184
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued C. Critical accounting judgements
Assessment of control
We have considered whether the nature of the relationship with Hudson, including rights under the terms of the common and
preference stock investments and any other agreements, gave Ascential significant influence or control over the activities of Hudson.
Control exists when an investor is exposed to variable returns from their involvement with an investee and has the ability to affect those
returns through their power over that investee.
Power over the investee
As a result of the February 2023 financing and capital restructuring, we assessed Ascential could not exercise power over Hudson due to
the lack of ability to direct the relevant activities of Hudson because its entitlement to two board seats and 41.1% voting rights did not give
it majority power. We judged that our customary protective veto rights over significant changes to Hudson, including actions which
could change the credit risk of the business, were protective in nature and related to fundamental changes to Hudson that only apply in
exceptional circumstances. We further concluded that while Ascential may acquire control of Hudson in the future if a put option held by
MTII were exercised, this was not within the control of Ascential and therefore did not indicate control. Ascential had two call options
neither of which would result in it holding a majority of the voting rights of Hudson and neither were considered to be substantive at that
date because neither were exercisable until a later date. As part of Hudson’s February 2023 refinancing, we increased our funding to
Hudson. The funding was provided in a form of investment in preference shares on an arm’s length basis, without conversion or equity
rights, repayable by a maturity date and at a market rate of interest. The increase in funding did not change our determination of control
under IFRS 10 “Consolidated Financial Statements” as the terms were comparable to those that Hudson would be able to obtain from an
institutional lender given the risk profile and life cycle of the business. Our continued funding in 2023 to Hudson had helped to protect
the underlying investment in the business. We therefore determined that we continued to have significant influence over Hudson and
accounted for our investment using the equity method under IAS 28 “Investments in Associates and Joint Ventures”.
The 30 October 2023 agreement gave Ascential potential voting rights in Hudson that could be currently exercised by introducing the
Early Call option that allows Ascential to acquire majority voting rights immediately and until 1 April 2024. With no significant financial or
other encumbrances to prevent exercise from October 2023, from an accounting perspective, the potential voting rights granted by the
new Early Call option give Ascential power over the operational decisions of Hudson at any time from 30 October 2023. In making this
determination, we have considered that the new Early Call option is substantive given the agreement to purchase MTII’s common stock
by 15 April 2024.
Exposure or rights to variable returns from its involvement with the investee
The Group is exposed to variable returns from its involvement with Hudson through the participation in any profit or loss from ownership
of common stock and preference shares. We have therefore concluded that the Group exercised control over Hudson from 30 October
2023 onwards and have ceased equity accounting for our investment and consolidated Hudson into Ascential’s financial statements from
that point.
Classification of Hudson as held for sale and as a discontinued operation
On 30 October 2023, MTII and Ascential agreed to the initiation of the sale process for Hudson. Hudson is available for immediate sale, is
being actively marketed and can be sold in its current condition. We believe that the sale is highly probable and will complete within 12
months. Accordingly, Hudson was classified as a disposal group held for sale and discontinued operation from that date as it has been
acquired exclusively with a view to resale. The fair value loss, which is disclosed below in section E) has been shown within discontinued
operations in order to provide a more relevant picture of continuing operations.
D. Key sources of estimation uncertainty – Acquisition of subsidiary
Following the acquisition of control, we derecognised our existing investments in common stock and preference shares and, adjusting
these to fair value, these formed part of our acquisition consideration. Consideration also included the fair value of liabilities payable of
£67.9m, representing both the deferred payment to MTII for acquiring their 51% common stock holding in Hudson, which will become
due on 16 April 2024 at the latest, and the fair value of preference shares held by MTII. In addition, the consideration included the fair
value of the put and call options held over MTII’s common stock. Under the anticipated-acquisition method, the Group accounted for the
non-controlling interests of MTII and certain other minority shareholders as if the put and call options had been exercised already.
The valuation of consideration and the resultant net held for sale assets (see Note 11) of £59.2m have been supported by an external
valuation conducted by an independent expert who relied primarily on a discounted cash flow methodology based on management
forecasts. Key inputs included compound annual revenue growth of c.45% over the forecast period, the discount factor and a terminal
growth rate of 3.5% thereafter. We see no significant change in the valuation between the acquisition date and the year end. The key
inputs are considered significant estimates in the preparation of the financial statements. There is a significant range of possible
outcomes in these estimates due to the start-up and high growth potential nature of the business. However, the following sensitivities
provide an indication of how sensitive the valuation is to changes in these estimates. A 1% increase in the discount rate would reduce the
valuation by £8.5m, a 1% decrease in the terminal growth rate would reduce the valuation by £3.0m and a 1% reduction in compound
annual revenue growth over the forecast period would reduce the valuation by £8.1m.
185
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 30. Hudson continued
E. Fair value loss
We recognised finance costs of £116.7m, or £93.6m post tax (see Note 11), to reflect the loss in value of our preference shares and
common stock, the fair value movement of the MTII put and call options, and future deferred consideration of £65.7m (see Note 21).
This aligns with a valuation by an independent external expert representing fair value less costs to sell. This is partially offset by a £9.0m
recycling of exchange gains from equity upon the change in accounting. This fair value loss reflected the change in both internal and
external factors around the time of the strategic decision in October 2023, including the early stage profile of Hudson, with limited proof
points of the expected future high growth in the current high discount rate environment from which a third-party market participant
valuation would be derived. Also, given the early stage of the sale process for Hudson as of the balance sheet date, there was an absence
of definitive external third-party market evidence of value for the business. A future acquirer may have a number of factors specific to
them that may value Hudson differently from a general market participant, a different cost of capital or synergies. The sale process may
therefore conclude with a materially different business valuation.
F. Results and balance sheet
The results of Hudson for the year, as included within Ascential’s financial statements, and the major classes of assets and liabilities of
Hudson classified as held for sale as at 31 December 2023 are presented within Note 11. In accordance with IFRS 5, “Non-current Assets
Held for Sale and Discontinued Operations”, we have not disaggregated balance sheet or profit or loss disclosure relating to subsidiaries
acquired exclusively with a view to resale.
31. Events after the reporting date
Disposals of Digital Commerce and Product Design businesses
On 2 January 2024 the Group completed the sale of its Digital Commerce business to Omnicom Group Inc and on 1 February 2024 the
Group announced the completion of the sale of its Product Design business to Wind UK Bidco 3 Limited (a newly formed company
established by funds advised by Apax Partners). The consideration for both transactions totalled £1.2 billion. The provisional pre-tax profit
on disposal of these businesses is expected to be approximately £0.5 billion with a tax charge of approximately £50m. These profits are
subject to the finalisation of the completion balance sheets with the buyers in 2024.
Refinancing
On 19 December 2023, the Group signed a new four-year multi-currency revolving credit facility (“RCF”) of £225.0m with an accordion of
up to a further £75.0m or 100% of EBITDA (see Note 22).
186
Notes to the Consolidated Financial Statements continuedAscential plc Annual Report 2023Financial statements continued Parent Company
Balance Sheet
As at 31 December 2023
(£ million)
Assets
Non-current assets
Investments
Deferred tax
Trade and other receivables
Current assets
Trade and other receivables
Liabilities
Current liabilities
Trade and other payables
Net assets
Equity
Called-up share capital
Share premium
Group restructure reserve
Reserves
Total equity
Note
2023
2022
6
7
7
7
8
9
9
9
9
653.0
0.6
–
653.6
95.2
95.2
3.5
3.5
745.3
4.4
154.1
157.9
428.9
745.3
652.8
0.5
93.5
746.8
0.5
0.5
2.0
2.0
745.3
4.4
153.6
157.9
429.4
745.3
The Company has taken advantage of the exemption offered by Section 408 of the Companies Act 2006 not to present its income
statement. The loss for the year ended 31 December 2023 was £16.6m (2022: £9.8m).
The accompanying notes on pages 189 to 194 are an integral part of these financial statements. The financial statements on pages 187
to 188 were approved by the Board of Directors on 25 March 2024 and were signed on its behalf by Directors: Philip Thomas and
Mandy Gradden.
187
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Parent Company Statement
of Changes in Equity
For the year ended 31 December 2023
(£ million)
At 1 January 2022
Loss for the year
Issue of new shares
Share purchases
Shares issued to employees
Share-based payments
Taxation of share-based payments
At 31 December 2022
Loss for the year
Issue of new shares
Share purchases
Shares issued to employees
Share-based payments
Taxation of share-based payments
Share capital Share premium
4.4
–
–
–
–
–
–
4.4
–
–
–
–
–
–
153.3
–
0.3
–
–
–
–
153.6
–
0.5
–
–
–
–
Group
restructure
reserve
157.9
–
–
–
–
–
–
157.9
–
–
–
–
–
–
At 31 December 2023
4.4
154.1
157.9
The accompanying notes on pages 189 to 194 are an integral part of these financial statements.
Reserves
Own shares
(0.1)
–
–
(3.7)
2.7
–
–
(1.1)
–
–
(6.7)
6.5
–
–
(1.3)
Retained
earnings
426.9
(9.8)
–
–
(2.7)
16.7
(0.6)
430.5
(16.6)
–
–
(6.5)
22.8
–
430.2
Total equity
742.4
(9.8)
0.3
(3.7)
–
16.7
(0.6)
745.3
(16.6)
0.5
(6.7)
–
22.8
–
745.3
188
Ascential plc Annual Report 2023 Notes to the Company
Financial Statements
For the year ended 31 December 2023
1. Corporate information
4. Principal accounting policies
Ascential plc (the “Company”) is a company incorporated in the
United Kingdom under the Companies Act 2006 and listed on the
London Stock Exchange. The registered office is located at 2nd
Floor, 81-87 High Holborn, London, WC1V 6DF. The registered
company number is 09934451. Ascential plc is the parent
Company of the Ascential Group (the “Group”) and its principal
activity is to act as the ultimate holding company of the Group.
2. Company accounting policies
Basis of accounting
The Company meets the definition of a qualifying entity under
Financial Reporting Standard 100 (“FRS 100”) issued by the
Financial Reporting Council. The financial statements have
therefore been prepared in accordance with Financial Reporting
Standard 102 (“FRS 102”), the Financial Reporting Standard
applicable in the UK and Republic of Ireland as issued by the
Financial Reporting Council.
As permitted by FRS 102, the Company has taken advantage of the
disclosure exemptions for the presentation of a statement of cash
flows; disclosure of key management personnel compensation;
disclosure of related party transactions between wholly-owned
subsidiaries and parents within a group; disclosures required under
IFRS 2 “Share-Based Payments” in respect of Group settled
share-based payments; disclosures required by IFRS 7 “Financial
Instruments: Disclosures”; certain disclosures required under IFRS
13 “Fair Value Measurement”; and disclosure of information in
relation to new standards not yet applied.
The financial statements are presented in Pounds Sterling being
the Company’s functional currency and have been prepared on a
historical cost and going concern basis.
Going Concern
A principal objective of the Group (of which the “Company” is the
holding company), is to manage cash and debt to safeguard the
Group’s ability to continue as a going concern for the foreseeable
future and for at least the next 12 months from the date of
approving these financial statements. The Group retains sufficient
resources to remain in compliance with the financial covenants of
its bank facilities. The Directors have also assessed the Group’s
prospects and viability over a three-year period. The Directors
therefore consider it appropriate to adopt the going concern basis
in preparing the financial statements. Refer to Note 1 of the
consolidated financial statements.
3.
Income statement
Fees paid to the auditor during the year for the audit of the
Company accounts were £23,100 (2022: £23,100). Fees paid by the
Company to the auditor for other services were £nil (2022: £nil).
Investments in subsidiaries
Subsidiaries are entities that are directly or indirectly controlled by
the Company. Control exists where the Company has the power
to govern the financial and operating policies of the entity so as to
obtain benefits from its activities. The investment in the
Company’s subsidiaries is recorded at cost less provisions for
impairment. Carrying values are reviewed for impairment either
annually, or more frequently if events or changes in circumstances
indicate a possible decline in carrying values. The Company uses
forecast cash flow information and estimates of future growth to
assess whether investments are impaired. If the results of
operations in a future period are adverse to the estimates used for
impairment testing, an impairment may be triggered at that point.
Income tax
Tax on the profit or loss for the year comprises current and
deferred tax. Tax is recognised in the income statement except to
the extent that it relates to items recognised directly in equity or
other comprehensive income, in which case it is recognised
directly in equity or other comprehensive income.
Current tax is the expected tax payable or receivable on the
taxable income or loss for the year, using tax rates enacted or
substantively enacted at the balance sheet date, and any
adjustment to tax payable in respect of previous years.
Deferred tax is provided on timing differences which arise from
the inclusion of income and expenses in tax assessments in
periods different from those in which they are recognised in the
financial statements. Timing differences are not provided for
differences relating to investments in subsidiaries to the extent
that it is not probable that they will reverse in the foreseeable
future and the reporting entity is able to control the reversal of the
timing difference. Deferred tax is not recognised on permanent
differences arising because certain types of income or expense
are non-taxable or are disallowable for tax or because certain tax
charges or allowances are greater or smaller than the
corresponding income or expense.
Deferred tax is measured at the tax rate that is expected to apply
to the reversal of the related difference, using tax rates enacted or
substantively enacted at the balance sheet date. Deferred tax
balances are not discounted.
Unrelieved tax losses and other deferred tax assets are
recognised only to the extent that it is probable that they will be
recovered against the reversal of deferred tax liabilities or other
future taxable profits.
189
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Financial statements continued
Notes to the Company Financial Statements
continued
4. Principal accounting policies continued
Share-based payments
Certain employees of the Company receive part of their
remuneration in the form of share-based payment transactions,
whereby employees render services in exchange for shares or
rights over shares. The cost of equity-settled transactions with
employees is measured at fair value at the date at which they are
granted. The fair value of share awards with market-related vesting
conditions is determined by an external consultant and the fair
value at the grant date is expensed on a straight-line basis over the
vesting period based on the Company’s estimate of shares that will
eventually vest. The estimate of the number of awards likely to
vest is reviewed at each balance sheet reporting date up to the
vesting date, at which point the estimate is adjusted to reflect the
actual outcome of awards which have vested. No adjustment is
made to the fair value after the vesting date even if the awards are
forfeited or not exercised.
Where the Company grants options over its own shares to the
employees of its subsidiaries, it recognises an increase in the cost
of investment in its subsidiaries equivalent to the equity-settled
share-based payment charge recognised in the subsidiary’s
financial statements with the corresponding credit being
recognised directly in equity. In cases where a subsidiary is
recharged for the share-based payment expense, no such increase
in investment is recognised.
Shares held by the Employee Benefit Trust (“EBT”)
The EBT provides for the issue of shares to Group employees
under share incentive schemes. The Company has control of the
EBT and accounts for the EBT as an extension to the Company in
the financial statements. Accordingly, shares in the Company held
by the EBT are included in the balance sheet at cost as a deduction
from equity.
5. Directors’ emoluments
During the years ended 31 December 2023 and 31 December 2022,
the Company had no employees other than the Directors. Full
details of the Directors’ remuneration and interests are set out in
the Directors’ Remuneration Report on pages 115 to 125.
6.
Investments
(£ million)
At 1 January
Additions
At 31 December 2023
2023
652.8
0.2
653.0
2022
652.8
–
652.8
On 23 November 2023, the Company transferred its shares in
Flywheel Digital Holdings Limited (two ordinary shares of USD 0.01
each) to Ascential Financing Limited in exchange for the issuance
of additional shares in Ascential Financing Limited. The additions
of £0.2m represent this additional investment in Ascential
Financing Limited.
The Company assessed the carrying value of its investments and
concluded that there was no indication that an investment may
be impaired.
The Company’s subsidiaries, joint ventures and associates are
listed below, split below by those pertaining to continuing and
discontinued operations. Unless otherwise stated, all subsidiaries
were indirectly and wholly owned as at 31 December 2023.
Ascential Financing Limited was directly and wholly owned by
Ascential plc as at 31 December 2023, (2022: Flywheel Digital
Holdings Limited and Ascential Financing Limited).
Continuing operations
Name
United Kingdom
Ascential America Holdings Limited
Ascential Events (Europe) Limited
Ascential Financing Limited
Ascential Group Limited
Ascential Information Services Limited
Ascential Operations Limited
Ascential P&P Limited
Ascential Radio Financing Limited
Ascential UK Holdings Limited
Contagious Communications Limited
Rembrandt Technology Limited
Siberia Europe Limited
Steel River Media Limited
WGSN Group Limited
China
Key
UK1
UK1
UK1
UK1
UK1
UK1
UK1
UK1
UK1
UK1
UK1
UK1
UK1
UK1
WARC Business Information Consulting (Shanghai) Co., Ltd. CH1
France
Ascential Events France SAS
Jersey
Ascential Jersey Financing Limited
Singapore
Ascential (Singapore) Pte. Limited
Asian Advertising Festival (Spikes Asia) Pte Limited (50%)
United States
Contagious Communications Inc.
Money2020 LLC
WARC LLC
FR1
JE1
SG1
SG2
US1
US1
US1
190
Ascential plc Annual Report 2023 Discontinued operations
Digital Commerce1
Name
United Kingdom
Digital Commerce Holdings Limited
Edge by Ascential Limited
Flywheel Digital Limited
Flywheel Digital International Holdings Limited
Perpetua Labs Limited
Spotlight an Ascential Company Limited
Brazil
Key
UK1
UK1
UK1
UK1
UK1
UK1
Name
Japan
Ascential Japan Kabushiki-Kaisha
Malaysia
Flywheel Digital Malaysia Sdn. Bhd.
Philippines
Flywheel Digital Philippines Inc.
Singapore
Datamart Solutions Pte. Ltd.
Era Serviços de Inteligência em Software Ltda
BR2
Flywheel Digital Singapore Pte. Ltd.
Canada
Perpetua Labs Ltd
Cayman Islands
Intrepid E-Commerce Services Pte. Ltd.
CN1
Thailand
Flywheel Digital Thailand Co., Ltd
Flywheel Digital Holdings Limited
CI1
Intrepid Trading (Thailand) Co., Ltd. (49%)
China
Ascential Data Services (Shanghai) Company Limited
Clavis Information Technology (Shanghai) Limited
Hangzhou Duozhun Data Technology Co. Limited
Flywheel Digital Shenzhen Co., Ltd
Shenzhen 4KMiles Technologies, Limited.
Guangzhou 4KMiles Data Technologies, Limited.
Hangzhou Qianli Chuanyin Data Technology Co. Limited.
CH2
CH3
CH4
CH5
CH6
CH7
CH8
United States
Edge by Ascential, LLC
Flywheel Digital LLC (Maryland)
Flywheel Digital LLC (Washington)
Perpetua Labs, Inc.
OneSpace Inc.
Spotlight Digital Commerce LLC
WhyteSpyder LLC
4KMiles Tec Limited
Germany
Perpetua Labs GmbH
Hong Kong
Flywheel Digital Limited
Intrepid E-commerce Hong Kong Limited
HongKong 4KMiles Technology Limited
HongKong 4K Miles Information Technology Limited
Indonesia
PT Flywheel Digital Indonesia
Ireland
Clavis Technology Limited
GE2
ASR Group Holdings LLC (51% owned)
HK3
HK2
HK3
HK3
IN1
IR1
Hyperdrive LLC (51% owned)
Pet Gear LLC (51% owned)
We Love Best LLC (51% owned)
Recon Commerce LLC (51% owned)
HBW Commerce LLC (51% owned)
Market Bound LLC (51% owned)
Fascam LLC (51% owned)
Vietnam
Datamart Viet Nam Company Limited (99.98%)
Intrepid Vietnam Company Limited (99.96%)
Key
JP1
MY1
PH1
SG3
SG3
SG3
TH1
TH1
US1
US2
US3
US1
US1
US1
US4
US3
US1
US5
US6
US6
US7
US6
US8
US9
VT1
VT2
1
The sale of the Digital Commerce (“Flywheel”) entities was completed on 2 January
2024. This represents the address at 31 December 2023.
191
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Financial statements continued
Notes to the Company Financial Statements
continued
Product Design2
Name
United Kingdom
CLR Code Limited
WGSN Limited
Worth Global Style Network Ltd
Brazil
Ascential Serviços de Informação Ltda
Sistema Use Fashion Comércio de Informações Ltda
China
CTIC WGSN China Limited (51% Joint Venture)
Shanghai Coloro Co., Limited (27% Joint Venture)
WGSN Business Information Consulting (Shanghai)
Company Limited
Germany
WGSN GmbH
Hong Kong
WGSN (Asia Pacific) Ltd
Spain
WGSN Intelligence España SL
South Africa
WGSN (Pty) Limited
Turkey
WGSN Group Trend Forecasting Moda Danişmanlik
Hizmetleri Limited Şirketi
United States
Ascential Inc.
CLR Code LLC
Key
UK1
UK1
UK1
BR1
BR1
CH10
CH11
CH9
GE2
HK1
SP1
SA1
TR1
US1
US1
2
The sale of the Product Design (“WGSN”) entities was completed on 1 February 2024.
This represents the address at 31 December 2023
Hudson
United Kingdom
Hudson MX Limited (36.8%)
United States
Hudson MX Holdings, Inc (36.8%)
Hudson MX, Inc. (36.8%)
Global Media Payments, Inc. (36.8%)
UK1
US1
US1
US10
Key
UK1
US1
Address
2nd Floor, 81-87 High Holborn, London, WC1V 6DF, United
Kingdom
251 Little Falls Drive, Wilmington, New Castle, Delaware,
19808, United States
US2 7 St. Paul Street, Suite 820, Baltimore, Maryland, 21202,
United States
US3
300 Deschutes Way SW, Suite 304, Tumwater, Washington,
98501, United States
US4 300 Spring Building, Suite 900, 300 S. Spring Street, Little
Rock, Arkansas, 72201, United States
US5
US6
US7
US8
US9
55614 Cardinal Drive, South Bend, Indiana, 46619, United States
6605 Longshore Street, Suite 240 #107, Deblin, Ohio, 43017,
United States
7877 MeadowHaven BLVD. Columbus, Ohio, 43235,
United States
15 West South Temple, Suite 600 Salt Lake City, Utah, 84101,
United States
1221 College Park Drive Ste 116, Dover, Delaware, 19904,
United States
US10 1209 Orange Street, Wilmington, New Castle County,
Delaware, 19801 United States
US11 Corporate Creations Networks Inc. 3411 Silverside Road, Tatnall
Building STE 104, Wilmington, Delaware, 19810, United States
BR1
Rua Tabapuã, 841, 1st floor, Itaim Bibi, São Paulo-SP,04533-01,
Brazil
BR2 Alameda Jaú, 1754 – 10º andar – Jardim Paulista, São Paulo – SP,
Brazil
CN1
1133 Melville Street, Suite 3500, The Stack, Vancouver, BC
V6E 4E5, Canada
CI1 Walkers Corporate Limited, 190 Elgin Avenue, George Town,
Grand Cayman KY1-9001, Cayman Islands
CH1 Room101, No.852 Kangning Road, Jingan District, Shanghai,
People’s Republic of China
CH2 Unit 3106/3107, No.968, West Beijing Road, Jing’an District,
Shanghai, People’s Republic of China
CH3 Unit 3105/3108, No.968, West Beijing Road, Jing’an District,
Shanghai, People’s Republic of China
CH4 Building 9, 998 Wenyi West Road, Wuchang Avenue, Yuhang
District, Hangzhou, Zhejiang, People’s Republic of China
CH5 Unit 547, Building 6, 16 Zhuantang Science and Technology
Economic Zone, Xihu District, Hangzhou, Zhejiang, People’s
Republic of China
CH5 Unit 4701, China Energy Storage Building, 3099 KeYuan
South Road, Nanshan District, Shenzhen, Guangdong,
People’s Republic of China
CH6 Room 2005H, Tower B, Zhongshen Park, 2010 Caitian Road,
Fushan Community, Futian District, Shenzhen, People’s
Republic of China
CH7 Room 302, Building 4, 6 Bohui Street, Tianhe District,
Guangzhou, People’s Republic of China
192
Ascential plc Annual Report 2023 Key
Address
CH8 Room 1102, Floor 11, Hui He Xi Fu Hui Building 3, Jianggan
District, Hangzhou, People’s Republic of China
CH9 Room 617, 28 Tan Jia Du Road, Putuo District,
Shanghai,People’s Republic of China
CH10 Unit 502, Floor 5, Building 4, No.300, Dingyuan Road,
Songjiang District, Shanghai, People’s Republic of China
CH11 Floor 2-4, Building 4, No. 300, Dingyuan Road, Songjian
District, Shanghai, People’s Republic of China
FR1
GE1
43-47 avenue de la Grande Armée, 75116 Paris, France
Linienstrasse 214, 10119, Berlin, Germany
GE2 Speditionstraße 15a, 40221, Düsseldorf, NRW, Germany
HK1
23rd Floor, Lee Garden Six, 111 Leighton Road, Causeway Bay,
Hong Kong
HK2 RM 302, 3/F Malaysia Bldg, 47-50 Gloucester Rd, Hong Kong
HK3
IN1
IR1
JP1
16th Floor, Wing On Centre, 111 Connaught Road Central,
Hong Kong
GOWORK – Sopo Del Tower : Tower B, 22nd Floor, Ruangan
No. 2235-2236 Jl. Mega Kuningan Barat III Lot 10. 1-6, Jl. Mega
Kuningan Barat, Kuningan, Daerah Khusus Ibukota Jakarta 12950
9th floor, O’Connell Bridge House, D’Olier Street, Dublin 2,
Ireland
Kamiyacho Trust Tower 22nd floor, 4-1-1 Toranomon,
Minato-ku, Tokyo Postal Code 105-6923, Japan
JE1
44 Esplanade, St Helier, Jersey, JE4 9WG, Channel Islands
MY1 Unit 30-01, Level 30, Tower A, Vertical Business Suite,
Avenue 3 Bangsar South, No 8 Jalan Kerinchi, Kuala Lumpur,
Wilayah Persekutuan, 59200, Malaysia
PH1 Unit 2803, 28th Floor, Trade and Financial Tower, 7th Avenue
corner 32nd Street, Bonifacio Global City, Taguig, 1630,
Philippines
SG1
133 New Bridge Road, Chinatown Point #08-03, 059413, Singapore
7. Trade and other receivables
(£ million)
Debtors – due within one year
Prepayments
Amounts due from Group undertakings
Debtors – due after more than one year
Deferred tax asset
Amounts due from Group undertakings
Total
2023
2022
0.7
94.5
95.2
0.6
–
0.6
95.8
0.5
–
0.5
0.5
93.5
94.0
94.5
Amounts due from Group undertakings accrue interest at various
rates, are unsecured and are repayable on demand. There are no
material expected credit loss provisions.
Deferred tax asset
(£ million)
At 1 January
Deferred tax credit in equity
Deferred tax credit in income statement
for the year
At 31 December
2023
0.5
–
0.1
0.6
2022
0.5
(0.6)
0.6
0.5
8. Trade and other payables – due within one year
(£ million)
Trade payables
Accruals
Other taxation and social security
2023
2022
–
1.8
1.7
3.5
0.3
0.8
0.9
2.0
SG2 182 Cecil Street, Level 17 Frasers Tower, 069547, Singapore
SG3 9 Raffles Place, #26-01 Republic Plaza, Singapore 048619,
Total
9. Share capital and reserves
Refer to Note 24 of the consolidated Group financial statements.
Singapore
SA1 Workshop17, 32 Kloof Street Gardens, Cape Town 8000,
South Africa
SP1 C/ San Elías 29-35, 5º, 08006 Barcelona, Spain
TH1
TR1
VT1
VT2
518/5 Floor No. 11, Maneeya Center Tower, Phloen Chit Road,
Lumpini Sub-District, Phatumwan District, Bangkok, Thailand
Esentepe Mh. Talatpaşa Cd. No:5 iç kapi no:1, Şişli, Istanbul /
P.K.: 34394, Turkey
Floor 5, B&L Building, 119-121 Ung Van Khiem, Ward 25, Binh
Thanh District, Ho Chi Minh City, Vietnam
9th Floor, No. 208 Nguyen Trai, Pham Ngu Lao Ward, District
1, Ho Chi Minh City, Vietnam
For the year ended 31 December 2023, the below companies were
exempt from the requirement for audit of individual financial
statements in accordance with section 479A of the Companies
Act 2006:
• WGSN Group Limited, registration number 8256689
• Rembrandt Technology Limited, registration number 11120186
• Ascential Operations Limited, registration number 08255890
193
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Financial statements continued
Notes to the Company Financial Statements
continued
10. Related party transactions
The Company has taken advantage of the exemption under FRS
102 and therefore has not disclosed related party transactions with
wholly owned subsidiaries. The Company has no other related
party transactions other than the compensation of key
management personnel, set out in Note 26 of the consolidated
Group financial statements.
11. Commitments and contingencies
The Company is a guarantor to the facilities described in Note 22
of the consolidated Group financial statements.
During the year the Company was a member of the Group cash
pooling arrangement. This allows the Group to combine the
liquidity of companies within the Group in order to distribute such
cash centrally as required.
The Company is registered with H.M. Revenue & Customs as a
member of the Ascential Group Limited group for Value Added
Tax and Pay As You Earn purposes and is therefore jointly and
severally liable on a continuing basis for amounts owing by other
members of the Group in respect of their value added tax, income
tax and national insurance contributions liabilities.
During the year, the Company agreed to guarantee certain
obligations of Ascential Financing Limited in the sale of both
WGSN and Digital Commerce. Together with Ascential Financing
Limited, it also provided certain customary warranties, indemnities
and contractual protections to the purchaser of Digital Commerce.
Both purchasers obtained buy-side warranty and indemnity
insurance which is their key form of recourse (save in respect of
certain limited matters) in the event of any claim.
12. Events after the reporting date
Refer to Note 31 of the consolidated Group financial statements.
In addition, on 20 March 2024 following the sale of Digital
Commerce and WGSN, a dividend of £758.4m was declared by
Ascential Financing Limited and approved by the Company on the
same day, increasing the Company’s profits available for
distribution in 2024.
There were no other reportable events after 31 December 2023.
194
Ascential plc Annual Report 2023 Alternative performance
measures
Non-trading items
Non-trading items are recorded in accordance with the
Group’s policy set out in Note 2 to the financial statements.
They arise from portfolio investment and divestment decisions,
from changes to the Group’s capital structure, as well as material
events that are expected to be outside the course of ordinary
operating activities, (e.g. deferred consideration, integration
costs and professional fees on acquisitions). They do not reflect
underlying operational performance.
Amortisation of intangible assets acquired through business
combinations
Charges for amortisation of acquired intangibles arise from the
purchase consideration of a number of separate acquisitions.
These acquisitions are portfolio investment decisions that took
place at different times over many years, so the associated
amortisation does not reflect current performance.
Share-based payments
Ascential operates several employee share schemes. Income
statement charges or credits relating to such schemes are a
significant non-cash charge or credit and are driven by a valuation
model which references the Ascential share price and future
performance expectations. The income statement charge or
credit is consequently subject to volatility and does not fully reflect
current operational performance.
Gains and losses on disposal
Gains and losses on disposal of businesses arise from divestment
decisions that are part of strategic portfolio management and do
not reflect current operational performance.
Tax related to Adjusting items
The elements of the overall Group tax charge relating to the
Adjusting items are also, for consistency, treated as Adjusting.
These elements of the tax charge are calculated with reference
to the specific tax treatment of each Adjusting item, taking into
account its tax deductibility, the tax jurisdiction concerned,
and any previously recognised tax assets or liabilities.
Ascential aims to maximise shareholder value by optimising the
potential for return on capital through strategic investment and
divestment, by ensuring the Company’s capital structure is
managed to support both strategic and operational requirements,
and by delivering returns through a focus on organic growth and
operational discipline. The Board considers it helpful to provide,
where practicable, additional performance measures that
distinguish between these different factors – these are also the
measures that the Board uses itself to assess the performance of
the Company, on which the strategic planning process is founded
and on which management incentives are based. Accordingly, this
report presents the following non-GAAP measures alongside
standard accounting terms as prescribed by IFRS and the Companies
Act, in order to provide this useful and additional information.
Adjusted profit measures
The Group uses Adjusted profit measures to assist readers in
understanding underlying operational performance. These
measures exclude income statement items relating to items arising
from portfolio investment and divestment decisions, and from
changes to capital structure. Such items arise from events which
are non-recurring or intermittent, and while they may generate
substantial income statement amounts, do not relate to the ongoing
operational performance that underpins long-term value generation.
The income statement items that are excluded from Adjusted profit
measures are referred to as Adjusting items. Both Adjusted profit
measures and Adjusting items are presented together with statutory
measures on the face of the profit and loss statement.
The Group presents a non-GAAP profit measure, Adjusted
EBITDA, in order to aid, where possible, comparisons with peer
group companies and provide a reference point for assessing
the operational cash generation of the Group. Adjusted EBITDA
is defined as Adjusted Operating Profit before depreciation and
amortisation. The Group measures operational profit margins with
reference to Adjusted EBITDA. As Adjusted results include the
benefits of portfolio investment and divestment decisions but
exclude significant costs (such as amortisation of acquired
intangibles and Non-trading items), they should not be regarded
as a complete picture of the Group’s financial performance, which
is presented in its Total results. The exclusion of other Adjusting
items may result in Adjusted results being materially higher or
lower than Total results.
Adjusting items are not a defined term under IFRS, so may not be
comparable to similar terminology used in other companies’ financial
statements and should not be viewed in isolation but as supplementary
information. Details of the charges and credits presented as
Adjusting items are set out in Note 6 to the financial statements.
The basis for treating these items as Adjusting is as follows:
195
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Alternative performance measures continued
Adjusted cash flow measures
The Group uses Adjusted cash flow measures for the same purpose as Adjusted profit measures. The two measures used are Adjusted
Cash Generated from operations, and Free Cash Flow. The Group monitors its operational efficiency with reference to operational cash
conversion. These are reconciled to IFRS measures as follows:
£’m
Cash (outflow)/generated from total operations
Less: cash outflow from discontinued operations
Add back: acquisition-related contingent consideration cash flow
Add back: other non-trading cash flow
Adjusted cash generated from continuing operations
Adjusted EBITDA from continuing operations
Operating cash flow conversion from continuing operations
Net cash (outflow)/generated from operating activities
Less: cash outflow from discontinued operations
Less: capital expenditure from continuing operations
Add back: tax paid by discontinued operations
Add back: acquisition-related contingent consideration cash flow
Add back: other non-trading cash flow
Free cash flow from continuing operations
Adjusted EBITDA from continuing operations
Free cash flow conversion from continuing operations
Leverage
The ratio of net debt to EBITDA is calculated as follows:
£’m
Adjusted EBITDA – Total Operations
Less: Rent expense
Adjusted EBITDA (pre-IFRS 16)
Net debt
Leverage ratio
Pro forma net debt
Pro forma net debt is calculated as follows:
£’m
Net debt at December 2023 – as reported
Net adjustment for:
Proceeds from sales of Digital Commerce and WGSN Costs of the sales and other strategic review costs
Cash set aside to acquire the remaining stake in Hudson
Cash tax
Return of value
Net debt – pro forma basis
2023
(3.9)
(42.1)
42.5
66.4
62.9
56.4
112%
(8.2)
(42.1)
(5.3)
0.9
42.5
66.4
54.2
56.4
96%
2022
53.4
(68.3)
19.5
52.3
56.9
49.9
114%
53.2
(68.3)
(4.5)
1.0
19.5
52.3
53.2
49.9
107%
2023
122.0
(6.1)
115.9
318.1
2.7x
Pro forma for
strategic actions
and return of
value
(318)
1,062
(850)
(106)
196
Ascential plc Annual Report 2023 Organic growth measures
To assess whether the Company is achieving its strategic goal of driving organic growth, it is helpful to compare like-for-like operational
results between periods. Income statement measures, both Adjusted and reported, can be significantly affected by the following factors
which mask like-for-like comparability:
• acquisitions and disposals of businesses lead to a lack of comparability between periods due to consolidation of only part of a year’s
results for these companies;
• discontinuation or curtailment of products or the move of event products between different periods; and
• changes in exchange rates used to record the results of non-Sterling businesses result in a lack of comparability between periods
as equivalent local currency amounts are recorded at different Sterling amounts in different periods.
Ascential therefore defines Organic growth measures, which are calculated with the following adjustments:
• results of acquired and disposed businesses are excluded where the consolidated results include only part-year results in either
current or prior periods;
• results of specific product lines are excluded if are being wholly or partly discontinued; and
• prior year and current year consolidated results are restated at constant currency for non-Sterling businesses.
Organic growth is calculated as follows:
2023
£’m
Revenue
2023 – reported
Acquisition of Contagious
2023 – Organic basis
Organic revenue growth
2022 – restated*
Disposal of RWRC
Transfer of Acuity
Currency adjustment
2022 – Organic basis
Adjusted EBITDA
2023 – restated*
Acquisition of Contagious
2023 – Organic basis
Organic EBITDA growth
2022 – restated*
Disposal of RWRC
Transfer of Acuity
Currency adjustment
2022 – Organic basis
* Restated for discontinued operations (refer to Note 11).
Marketing
Technology Corporate Costs
Financial
Total –
continuing
operations
130.5
(2.5)
128.0
22%
99.2
–
4.6
0.9
104.7
55.6
(0.5)
55.1
37%
40.1
–
–
0.2
40.3
75.9
–
75.9
1%
92.0
(7.4)
(4.6)
(4.5)
75.5
26.7
–
26.7
(7%)
31.6
0.1
–
(3.1)
28.6
–
–
–
–
–
–
–
–
–
(25.9)
–
(25.9)
(23%)
(21.8)
–
–
0.7
(21.1)
206.4
(2.5)
203.9
13%
191.2
(7.4)
–
(3.6)
180.2
56.4
(0.5)
55.9
17%
49.9
0.1
–
(2.2)
47.8
197
Strategic reportGovernance reportFinancial statementsAscential plc Annual Report 2023 Alternative performance measures continued
Glossary of alternative performance measures
Term
Organic revenue growth
Organic EBITDA growth
Non-trading items
Adjusting items
Description
Revenue growth on a like-for-like basis
Adjusted EBITDA growth on a like-for-like basis
Items within Operating profit/(loss) separately identified in accordance with Group
accounting policies
Non-trading items, Amortisation and impairment of intangible assets acquired through
business combinations, Share-based payments, Gains and losses on acquisition and
disposals, Write-off of unamortised arrangement fees on refinancing, Covenant
amendment fees and Tax related thereto
Adjusted operating profit/(loss)
Operating profit/(loss) excluding Adjusting items
Adjusted EBITDA
Adjusted EBITDA margin
Adjusted operating profit/(loss) excluding depreciation and amortisation
Adjusted EBITDA as a percentage of Revenue
Adjusted profit/(loss) before tax
Profit/(loss) before tax excluding Adjusting items
Adjusted tax charge
Adjusted effective tax rate
Adjusted EPS
Adjusted diluted EPS
Tax charge excluding Adjusting items
Adjusted tax charge expressed as a percentage of Adjusted profit before tax
EPS calculated with reference to Adjusted Profit/(loss) for the year
Diluted EPS calculated with reference to Adjusted Profit/(loss) for the year
Adjusted cash generated from operations
Cash generated from operations with cash generated from discontinued operations
acquisition-related contingent consideration and other non-trading cash flows excluded
Operating cash flow conversion
Adjusted cash generated from operations expressed as a percentage of Adjusted EBITDA
Free cash flow
Leverage
Net debt
Pro forma net debt
Net cash generated from operating activities including capital expenditure. Net cash
generated from discontinued operations, acquisition-related contingent consideration
and other non-trading cash flow are excluded
The ratio of Net debt to Adjusted EBITDA before, in both cases, accounting for the impact
of IFRS 16
Net debt comprises external borrowings net of arrangement fees, cash and cash
equivalents and derivative financial instruments. Net debt excludes lease liabilities in line
with how net debt is considered for the Group’s banking covenants
Net debt adjusted for (a) the proceeds, net of cash disposed, from the 2024 disposals of
Digital Commerce and WGSN (b) the cash costs of the disposals and associated strategic
review actions (c) the cash payable to acquire Hudson (d) the forthcoming £850m return
of value to shareholders and (e) cash taxes
198
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