Renishaw Annual Report 2014

FY2014 Annual Report · Renishaw
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Annual report and accounts 2014

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Contents

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

1

Introduction

Renishaw is a world leading metrology company.
With our highly experienced team, we are conﬁdently driving our 
future growth through innovative and patented products and  
processes, efﬁcient, high-quality manufacturing and the ability 
to provide local support in a growing number of geographies 
and markets. 93% of our sales are outside the UK.
Our continuing investment in property, plant and equipment and 
new product development (c.£75m in the last year) is the key to our 
conﬁdence in our long-term strategic prospects. With around 3,500 
skilled and motivated staff, we continue to be at the leading edge of 
technological innovation. 

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New building at New Mills 
A computer generated image of our 
new 153,000 sq ft building due for full 
occupation by the ﬁrst calendar quarter 
of 2015.

Find more information online

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You can access the annual and half year 
reports for the last ﬁve years from our 
website. Also available are recordings 
of previous webcasts.

www.renishaw.com/ﬁnancials

Information of interest to shareholders and others, 
such as videos explaining our products and 
business strategy, are provided on our website.

www.renishaw.com/investor

This Annual report has been prepared for the purpose of assisting the Company’s shareholders to assess 
the strategies adopted by the Company and the potential for those strategies to succeed and no-one, 
including the Company’s shareholders, may rely on it for any other purpose. The directors owe their duties 
only to the Company as a whole and they undertake no duty of care to individual shareholders, other 
stakeholders or potential investors. This Annual report has been prepared on the basis of the knowledge 
and information available to the directors at the time. Given the nature of some forward-looking information, 
which has been given in good faith, the Company’s shareholders should treat this information with 
due caution.

All dates within this document refer to ﬁnancial years unless stated otherwise.

For more information visit: 
www.renishaw.com

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Chairman’s statement

Sir David R McMurtry
Chairman and Chief Executive

I am pleased to report our 2014 
year’s results.

Revenue for the year ended 30th June 
2014 was £355.5m, compared with 
£346.9m for last year, an increase of 
2% and includes a record quarterly 
revenue of £107.0m achieved in the 
ﬁnal 3 months of the year. This and 
recent years have been characterised 
by large unpredictable revenue both in 
timing and value from certain Far East 
customers. If adjusted, this would result 
in underlying revenue growth of 8% for 
this year.

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The Group continues to invest for the  
long term, expanding our global marketing 
and distribution infrastructure, along with 
increasing manufacturing capacity and 
research and development activities.

The strengthening of Sterling during 
the second half of the ﬁnancial year has 
impacted group revenue; at previous 
year exchange rates revenue would have 
been higher by £11.2m, giving a revised 
underlying growth of 11%.

Regional analysis shows that the 
8% underlying revenue growth (as 
adjusted above) at actual exchange 
rates was 11% in the Far East; 8% in 
the Americas; 4% in Europe; and 15% 
in the UK. More speciﬁcally, revenue in 
the Americas increased from £79.2m 
to £85.6m; in Europe from £96.0m to 
£100.2m; and in the UK from £20.7m 
to £23.8m. 

The Group’s adjusted proﬁt before tax 
for the year was £70.1m, compared 
with an adjusted and restated £79.2m* 
last year. Statutory proﬁt before tax was 
£96.4m (2013: £82.1m), which includes 
the exceptional gain of £26.3m on the 
disposal of our shareholding in Delcam 
plc (see below). The strength of Sterling 
also impacted the group proﬁt before tax 
which, at previous year exchange rates, 
would have been higher by £6.8m.

The tax charge this year amounts to 
£10.7m (2013: £15.0m) representing 
a tax rate of 11.1% (2013: 18.3%). 
Excluding exceptional items, none of 
which is taxable, the underlying tax 

Revenue (£m)

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346.9

+2%

Proﬁt before tax (£m)

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Restated
2013

Change

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Restated
2013

Change

82.1

+17%

Operating proﬁt (£m)*

Adjusted proﬁt before tax (£m)*

Adjusted earnings per share (pence)*

Dividend per share (pence)

(cid:24)(cid:17)(cid:15)(cid:21)

(cid:24)(cid:17)(cid:15)(cid:18)

(cid:25)(cid:19)(cid:15)(cid:20)

(cid:21)(cid:18)(cid:15)(cid:19)

79.1

79.2

88.9

40.0

*Adjusted and restated proﬁt

-11%

Basic earnings per share (pence)

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92.9

+27%

-11%

-7%

+3%

Last year’s results have been restated from £84.4m to £82.1m to reﬂect the amendment to the accounting standard IAS 19 relating to pension accounting.  
Also, the adjusted proﬁt excludes the exceptional proﬁt of £26.3m on the disposal of the shareholding in Delcam plc for the current year and excludes an 
exceptional gain of £2.9m relating to an early settlement of a deferred consideration for the previous year.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

3

rate is 15.3% (2013: 19.0%). The tax 
rate improvement reﬂects a corporation 
tax reduction in the UK to 21% from 
April 2014 and 20% from April 2015, 
the latter being used for UK deferred 
tax calculations. The patent box tax 
incentive has resulted in a tax credit of 
£1.3m compared to £0.3m last year.

Adjusted earnings per share were 82.3p, 
compared with an adjusted and restated 
88.9p last year. Statutory earnings per 
share were 118.4p, compared with a 
restated 92.9p last year. 

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Revenue from our metrology business 
for the year was £326.6m, compared 
with £317.9m last year. Operating proﬁt 
was £74.4m (2013: £84.5m) and reﬂects 
continued investment in this business 
sector, currency effects and the tough 
revenue comparators in the Far East 
referred to above.

Global investment in production systems 
and processes in the key markets 
of aerospace, automotive, energy, 

construction, consumer electronics and 
agriculture continues with each requiring 
our new product offerings and system 
solutions to achieve demanding quality 
standards and efﬁciency improvements. 

We have experienced strong demand 
for our 3D metal additive manufacturing 
products as we continue to integrate 
the production, sales and marketing 
activities and the previously acquired 
LBC business in Germany within the 
group infrastructure. We also saw good 
growth in our measurement automation 
and encoder product lines. 

New product releases during the year 
include the SPRINT™ high-speed 
contact scanning system for machine 
tools which opens up completely new 
process control opportunities for high-
value CNC machine tools. The system 
incorporates a new generation of on-
machine scanning technology enabling 
fast and accurate form and proﬁle 
data capture from both prismatic and 
complex 3D components.

Our encoder products line launched 
the ultra-compact ATOM™ readhead, 
an innovative optical linear and rotary 
incremental encoder system. 

The spatial measurement product 
line has recently introduced the 
Quarryman® Pro into its mining and 
quarrying sector and the MX2 scanner 
used for mobile mapping and surveying 
is gaining wide market acceptance.

Other new product releases in 
the metrology business were the 
PH10M-iQ PLUS probe head (a new 
version of PH10 with reduced calibration 
time), RSP2 V2, a new improved version 
of the REVO 2D scanning probe, SPA3 
high powered compact CMM ampliﬁer 
and new software releases UCCsuite 4.6 
and 4.7 and MODUS 1.6.

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Revenue from our healthcare 
business for the year was £28.9m, 
compared with £29.0m last year. 
There was an operating loss of 
£4.0m, compared with a loss of 

Revenue £m

(cid:20)(cid:22)(cid:22)(cid:15)(cid:22)

346.9

331.9

288.7

Adjusted proﬁt  
before tax £m

Adjusted earnings  
per share pence

Dividend per share pence

86.0

79.2

(cid:24)(cid:17)(cid:15)(cid:18)

80.4

95.6

88.9

(cid:25)(cid:19)(cid:15)(cid:20)

88.5

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40.0

38.5

35.0

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2013

2012

2011

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2013

2012

2011

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2013

2012

2011

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2013

2012

2011

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Chairman’s statement continued

£5.4m last year. We experienced 
growth in our dental products but 
the strength of Sterling adversely 
impacted the sales performance of our 
spectroscopy products.

Further sales of the neuromate® surgical 
robot have been achieved this year 
and, in the USA, the FDA has issued 
clearance to place it on the market 
(known as the neuromate frameless 
Gen II stereotactic robotic system). 
This opens up new sales opportunities 
in the largest market for medical 
devices. Also, product registration for 
the neuromate has been granted by the 
Saudi Food and Drug Administration 
where a system is in use.

There is growing interest in our 
3D metal additive manufacturing 
system for dental applications and 
maxillofacial restorations.

The Company is manufacturing an 
investigational drug delivery system 
to the speciﬁcations required by an 
NHS Trust, which is conducting a 
clinician-led clinical trial for a therapy for 
the treatment of Parkinson’s disease. 
The system, which delivers therapies 
directly into the brain, is also on trial by 
the Trust to deliver a chemotherapy drug 
for the treatment of brain tumours. 

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The Group strategy to invest for the 
long-term, expanding our global 
marketing and distribution infrastructure, 
along with increasing manufacturing 
capacity and research and development 
activities continues.

Headcount at the end of June 2014 
was 3,492, an increase of 257 from the 
3,235 at the start of the ﬁnancial year, 
to support our growing research and 
development, production and global 
sales and marketing activities. The staff 
increase included 43 apprentices and 
59 graduates in the UK, taken on as part 
of our ongoing aim and commitment to 
train and develop skilled resource for the 
Group in the future.

Capital expenditure on property, plant 
and equipment for the year was £39.2m, 
of which £21.3m was spent on property 
and £17.9m on plant, equipment 
and vehicles. Work has continued 
on implementing a virtual machine 
environment in the UK and regional 
data centres to further enhance the 
resilience and efﬁciency of the Group’s 
IT infrastructure.

In the UK, work continues on the 
additional 153,000 sq ft facility at 
New Mills, with ﬁrst occupancy having 
taken place at the end of June; phased 
occupation is taking place over the 
next six months. This facility will house 

R&D and corporate services staff, as 
well as corporate demonstration and 
training facilities, and will enable our 
spectroscopy and laser calibration 
product lines to relocate to the 
headquarters’ site. 

In Germany, we have purchased 
buildings adjacent to our current 
premises in Pliezhausen, near Stuttgart, 
providing an additional 116,000 sq ft of 
facilities for our German subsidiary into 
which the LBC additive manufacturing 
business has relocated.

In Warsaw, our Polish sales subsidiary 
has moved to larger premises.

In Shanghai, our Chinese subsidiary 
acquired and relocated to 18,000 sq ft of 
ofﬁce space for the management of our 
operations throughout China.

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In March 2014, the Group purchased 
Advanced Consulting & Engineering, Inc  
(“ACE”), a supplier of dimensional 
measurement products and services 
focused on the automotive industry, 
based in the USA. ACE provides a range 
of in-house and on-site measurement 
services to its customers including 
contract inspection, CMM ﬁxture design, 
machine retroﬁts, CMM programming, 
training and full turnkey solutions 
from conception to completion. 
Since 2011 the company has also been 
a Renishaw distributor. 

(far left)  
Visit by the British Prime Minister

In May 2014 David Cameron (pictured with 
the neuromate® surgical robot) visited our 
Woodchester facility for a tour and question 
session with employees.

(left)  
Queen’s Award 2014

In April 2014 we received our 17th Queen’s 
Award, this time for Enterprise in the 
Innovations category for development of 
our inVia Raman microscope.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

5

As Renishaw continues to focus on 
supplying end-user metrology solutions, 
including CMM retroﬁts and installations 
of our Equator TM gauge, the specialist 
programming and applications 
knowledge within the ACE team will be 
particularly valuable.

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In February 2014, Autodesk 
Development B.V., a wholly-owned 
subsidiary of Autodesk, Inc. acquired the 
whole of the issued share capital of 
Delcam plc at a price of £20.75 per 
share. Renishaw held 1,543,032 
Delcam shares (19.4%) resulting 
in a total consideration of £32.0m. 
The investment held in the balance sheet 
was £5.7m, giving a proﬁt on disposal 
of £26.3m. This proﬁt is disclosed as 
an exceptional item in the Consolidated 
income statement.

It is our intention that the proceeds 
arising will be used to support ongoing 
and future investments in the business.

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Group inventory decreased to £63.0m 
from £65.3m at the beginning of the 
year, reﬂecting the high demand for 
products in the last quarter of the year 
and continuing improvement in the 
group inventory management systems. 
Trade debtors increased from £68.1m to 
£81.8m in line with a higher last quarter 

revenue compared with the ﬁnal quarter 
last year, with debtor days outstanding 
at the end of the current year at 63 days 
(2013: 62 days).

Net cash balances at 30th June 2014 
were £43.6m, compared with £26.6m at 
30th June 2013. Additionally, there is an 
escrow account of £9.5m (2013: £11.0m) 
relating to the provision of security to the 
UK deﬁned beneﬁt pension scheme.

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Following the retirement of Bill Whiteley, 
Dr David Grant was appointed as the 
senior independent director.

The directors thank employees for their 
invaluable support and contribution as 
the Group continues its development 
and expansion.

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In line with our commitment to improve 
investor communications, our ﬁrst 
investor day was held on 15th May 
2014, for existing and potential new 
investors. The event was well attended 
and the presentations and product 
demonstrations were positively received.

(cid:34)(cid:88)(cid:66)(cid:83)(cid:69)(cid:84)

On 21st April 2014, Renishaw received 
a Queen’s Award for Enterprise 2014 
in the Innovations category for its inVia 
Raman microscope. This prestigious 
award was granted for the continuous 

development of the inVia, with ultra-fast 
Raman imaging, which enables the rapid 
generation of high deﬁnition 2D and 3D 
chemical images for material analysis. 
This is the Company’s seventeenth 
Queen’s Award since the Company was 
set up in 1973.

(cid:48)(cid:86)(cid:85)(cid:77)(cid:80)(cid:80)(cid:76)

The new ﬁnancial year has started well 
and, with the ever growing range of 
products, processes and applications 
and our skilled and experienced 
employees, your directors remain 
conﬁdent in the prospects for the Group.

(cid:37)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)(cid:84)

A ﬁnal dividend of 29.87 pence net 
per share will be paid on 20th October 
2014, to shareholders on the register on 
19th September 2014.

Sir David R McMurtry
CBE, RDI, FRS, FREng, CEng, FIMechE
Chairman and Chief Executive
23rd July 2014 

(far left) 
Visit by HRH The Earl of Wessex

HRH The Earl of Wessex discusses a 3D 
printed gift with Renishaw co-founders 
Sir David McMurtry (l) and John Deer. 

(left)

ATOMTM readhead

An innovative ultra-compact optical linear 
and rotary incremental encoder system.

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Our business model

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innovative engineering to deliver successful solutions.

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(cid:116)(cid:1) We are a highly vertically integrated 
company to assure success for our 
customers. We not only undertake 
design of innovative products, we also 
manufacture and sell them through 
our wholly-owned manufacturing and 
sales organisations. 

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(cid:116)(cid:1) We anticipate future trends and seek to 
solve problems before they appear to 
be happening.

(cid:116)(cid:1) All areas of our organisation work in 
partnership with their customers to 
understand and solve their current and 
anticipated real-life problems.

(cid:116)(cid:1) We provide solutions that drive efﬁciency 

and reduce costs.

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Our ordinary dividend, funded from our 
annual cash ﬂow, is the primary form of 
shareholder return. We have increased the 
ordinary dividend per share by over 17% over 
the last three years. We aim to maintain a 
progressive and sustainable dividend policy.

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Our key performance indicators are shown 
on pages 42 and 43.

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Information on the risks associated with our 
business is contained on pages 44 and 45.

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(cid:116)(cid:1) Renishaw’s strategy of investment in 

R&D and engineering skills enables us to 
take a longer term view of the viability of 
new technologies.

(cid:116)(cid:1) We are actively expanding our 

signiﬁcant portfolio of innovative and 
patented products.

 
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7

Our strategy

See page 8 for more detail.

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“ Over the years, John Deer and I have  
tried to build a company that is different  
to most others. Different in how we  
apply technology to real world problems;  
in how we manufacture rather than 
outsource; in how we treat our customers 
as partners.”

Sir David McMurtry and John Deer
Chairman and Chief Executive and 
Deputy Chairman

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Strategic report

Our strategy in action

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Renishaw’s employees are 
central to the success of its 
business. Our innovative,  
hard-working and loyal 
employees make Renishaw 
the business success that it 
is. Many staff have worked 
in the Group for two or three 
decades, creating a wealth 
of specialised engineering 
expertise. In addition, 
Renishaw has actively 
focused on the ongoing 
recruitment and training of 
many bright and enthusiastic 
young graduates, apprentices 
and experienced professionals. 

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Renishaw is well known for its 
sector-leading investment in 
R&D and engineering. 
“Apply innovation” is a way of 
life for Renishaw employees, 
not just a strap-line. We have 
continued to protect our core 
businesses with exciting 
new patented technology 
and process developments, 
whilst also diversifying into 
new product and market areas.

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Renishaw is a strongly 
vertically integrated 
company with signiﬁcant 
in-house manufacturing 
capabilities. With high-quality 
manufacturing plants located 
in the UK, Ireland, India, 
Germany, USA and France 
we are able to deliver robust 
and reliable products tested 
to our exacting standards. 
Our efﬁciencies, through 
in-house automation and the 
use of our own latest product 
developments, enable us to be 
competitive with the highest 
volume processes. 

Renishaw is founded on the 
belief that excellent customer 
support delivers success. 
Our customers are often global, 
with an order being placed 
in one country, the product 
shipped to another and the 
eventual end-user often located 
on a different continent. It is by 
having “local” global support 
through our wholly-owned 
subsidiary network, that we 
are able to assure customers 
that whatever their needs, we 
are able to support and assist 
them, resulting in a positive 
return on their investment.

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Headcount has increased 
in the Group to 3,492. This 
includes 1,178 in our overseas 
subsidiaries and 2,314 in the 
UK. Renishaw’s in-house 
Academy, established 
initially to focus on technical 
applications engineer training 
modules, has now expanded 
to include sales development 
and corporate introductory 
courses for employees 
including graduates and 
apprentices. Training can be as 
diverse as presentation skills, 
team-building or technical 
training with one of Renishaw’s 
software products such as 
MODUSTM or Productivity+TM.

A signiﬁcant range of new 
products have been brought 
to market during the year, 
including game-changing 
technologies such as 
SPRINT™ and ATOM™.  
29 new patents have been 
ﬁled and 81 granted during this 
ﬁnancial year. The neuromate 
frameless Gen II robotic system 
was cleared for sale in the USA 
by the FDA on 29th April 2014.

We have continued to  
scale-up manufacturing at 
Miskin, increasing manufacturing 
capacity and reducing supply 
chain risk. We are now using 
154,000 sq ft for electronic 
and ﬁnal product manufacture 
including the production of our 
3D metal additive manufacturing 
(“AM”) machines which has 
been transferred from our UK 
facility in Stone, Staffordshire. 
Our machining and ﬁnishing 
capabilities have increased with 
new machine platforms and 
equipment now installed.

Renishaw continues to invest 
in training for both its technical 
support and sales staff. The 
Renishaw Academy now trains 
Renishaw staff around the world 
to ensure that they are able to 
deliver the excellent support 
levels that our customers 
demand. As the business 
continues to grow and diversify, 
headcount has been increased 
accordingly (+ 257) to ensure 
that resources are available 
where and when needed.

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9

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Renishaw’s business has 
transitioned over recent years 
from primarily being a supplier of 
products to capital equipment 
manufacturers to becoming 
much more focused on 
delivering a full solution directly 
to end-users. Our experience 
in our core product lines, 
highlighting that our global 
customers need assistance in 
solving their problems, is being 
carried across into our newer 
product lines (dental, gauging, 
neurological, diagnostics 
and AM). Our sales force and 
technical support teams need 
to be ever more knowledgeable, 
not just about what our 
products do, but also how 
they can be applied to beneﬁt 
our customers’ processes 
and practices. By truly 
understanding our customers’ 
needs, Renishaw is able to offer 
a cost-effective, efﬁcient and 
easy-to-use solution.

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Complex problems ideally 
require simple solutions. 
Whilst Renishaw’s hardware 
uses the latest technologies 
and innovative approaches to 
deliver robust and repeatable 
functionality that is world-class, 
our software is becoming 
ever more user-friendly, 
intuitive and packaged for 
speciﬁc problems. The user’s 
experience of Renishaw 
includes the sales teams, 
applications engineers and 
products, and we therefore 
endeavour to make this whole 
interaction a professional and 
positive experience. 

Renishaw has always been 
a global group with a strong 
“local” presence. By ensuring 
we target emerging markets 
we are able to develop strong 
working partnerships with 
newly developing businesses. 
These loyal relationships build 
quickly as our customers 
realise that all our customers 
are important to us. 

Whilst Renishaw does invest 
for the long term, it also closely 
manages costs at all levels 
and ensures that it does not 
undertake undue risks. It is 
through this approach that 
Renishaw has been able to 
deliver such a long-term track 
record of proﬁtable growth.

We actively undertake 
acquisition as a means to 
expand our product portfolio, 
quicken geographic market 
penetration and gain access 
to new patents, technologies 
and customers. 

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Renishaw’s expansion into new 
growth economies continues, 
and this year we have opened, 
extended or relocated to 
larger premises in the UK, 
Poland, Germany and China. 
This includes the purchase of 
a new 18,000 sq ft property 
in Shanghai, required to 
accommodate growth and 
act as headquarters for the 
China region.

Renishaw’s 153,000 sq ft 
new building at the New Mills 
site, which will house R&D, 
corporate services teams 
and corporate demonstration 
and training areas, will be fully 
occupied by 2015. Relocation 
started in June 2014. 
Renishaw purchased adjoining 
premises at Renishaw GmbH, 
Germany, giving an additional 
116,000 sq ft into which the 
LBC AM business is now 
housed alongside other 
Renishaw employees. 

In March 2014 we acquired 
Advanced Consulting & 
Engineering, Inc (“ACE”), a  
USA-based supplier of 
dimensional measurement 
products and services focused 
on the automotive industry. 
Given the importance of being 
successful at acquisitions, 
Renishaw is strengthening 
its in-house process to 
ensure quicker and more 
effective integration of newly 
acquired businesses.

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Strategic report

Our business sectors – Metrology

Renishaw REVO® 5-axis 
measurement system ﬁtted 
to a CMM measuring a 
gear component.

Revenue (+3%)
£326.6m

Operating proﬁt (-12%)
£74.4m

Percentage 
of group revenue
92%

Open 
here 
for more 
detail...

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Strategic report

Our business sectors - Metrology

Our metrology products help manufacturers to maximise production output, 
to reduce signiﬁcantly the time taken to produce and inspect components, and 
to keep their machines running reliably. In the ﬁelds of industrial automation and 
motion systems, our position measurement and calibration systems allow builders 
to manufacture highly accurate and reliable products. This illustration highlights 
typical applications for our products within a metal part production facility and 
semiconductor manufacturing plant.

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(cid:25)

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(cid:78)(cid:66)(cid:68)(cid:73)(cid:74)(cid:79)(cid:70)(cid:1)
(cid:85)(cid:80)(cid:80)(cid:77)(cid:1)(cid:81)(cid:83)(cid:80)(cid:67)(cid:70)

(cid:18)(cid:26)

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:48)(cid:46)(cid:55)

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fl(cid:80)(cid:80)(cid:83)(cid:1)(cid:80)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:38)(cid:82)(cid:86)(cid:66)(cid:85)(cid:80)(cid:83)(cid:150)

(cid:19)(cid:19)

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(cid:22) (cid:1)(cid:57)(cid:51)(cid:19)(cid:17)(cid:14)(cid:56)(cid:1)
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(cid:71)(cid:80)(cid:83)(cid:1)(cid:74)(cid:79)(cid:84)(cid:81)(cid:70)(cid:68)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
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(cid:83)(cid:66)(cid:69)(cid:74)(cid:80)(cid:1)(cid:85)(cid:83)(cid:66)(cid:79)(cid:84)(cid:78)(cid:74)(cid:84)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)
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(cid:84)(cid:80)(cid:71)(cid:85)(cid:88)(cid:66)(cid:83)(cid:70)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)
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(cid:68)(cid:80)(cid:79)(cid:85)(cid:83)(cid:80)(cid:77)

14-15

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:1)
ﬁ(cid:89)(cid:85)(cid:86)(cid:83)(cid:70)(cid:84)
(cid:78)(cid:80)(cid:69)(cid:86)(cid:77)(cid:66)(cid:83)(cid:1)fi(cid:89)(cid:85)(cid:86)(cid:83)(cid:74)(cid:79)(cid:72)(cid:1)(cid:1)
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(cid:67)(cid:77)(cid:66)(cid:69)(cid:70)(cid:1)(cid:84)(cid:70)(cid:68)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)

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(cid:86)(cid:84)(cid:70)(cid:69)(cid:1)(cid:71)(cid:80)r o(cid:71)(cid:71)(cid:14)(cid:77)(cid:74)(cid:79)(cid:70)(cid:1)(cid:1)
(cid:74)(cid:79)(cid:84)(cid:81)(cid:70)(cid:68)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
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(cid:71)(cid:80)(cid:83)(cid:1)(cid:78)(cid:66)(cid:68)(cid:73)(cid:74)(cid:79)(cid:74)(cid:79)(cid:72)(cid:1)
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(cid:78)(cid:66)(cid:68)(cid:73)(cid:74)(cid:79)(cid:70)

(cid:34)

(cid:36)

(cid:39)(cid:77)(cid:66)(cid:85)(cid:1)(cid:81)(cid:66)(cid:79)(cid:70)(cid:77)(cid:1)(cid:69)(cid:74)(cid:84)(cid:81)(cid:77)(cid:66)(cid:90)(cid:1)
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(cid:88)(cid:66)(cid:71)(cid:70)(cid:83)(cid:1)(cid:73)(cid:66)(cid:79)(cid:69)(cid:77)(cid:74)(cid:79)(cid:72)

(cid:35)

(cid:37)

(cid:52)(cid:70)(cid:78)(cid:74)(cid:68)(cid:80)(cid:79)(cid:69)(cid:86)(cid:68)(cid:85)(cid:80)(cid:83)(cid:1)
(cid:88)(cid:66)(cid:71)(cid:70)(cid:83)(cid:1)(cid:74)(cid:79)(cid:84)(cid:81)(cid:70)(cid:68)(cid:85)(cid:74)(cid:80)(cid:79)

(cid:56)(cid:74)(cid:83)(cid:70)(cid:1)(cid:67)(cid:80)(cid:79)(cid:69)(cid:70)(cid:83)

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

11

(cid:53)(cid:73)(cid:70)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:1)(cid:83)(cid:66)(cid:79)(cid:72)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:77)(cid:86)(cid:69)(cid:70)(cid:84)(cid:1)
(cid:85)(cid:73)(cid:70)(cid:1)(cid:71)(cid:80)(cid:77)(cid:77)(cid:80)(cid:88)(cid:74)(cid:79)(cid:72)(cid:27)

(cid:46)(cid:66)(cid:68)(cid:73)(cid:74)(cid:79)(cid:70)(cid:1)(cid:85)(cid:80)(cid:80)(cid:77)(cid:1)(cid:81)(cid:83)(cid:80)(cid:67)(cid:70)(cid:1)(cid:84)(cid:90)(cid:84)(cid:85)(cid:70)(cid:78)(cid:84)
Sensors and software for computer 
numerically controlled (“CNC”) metal 
cutting machine tools that allow the 
automation of setting and on-machine 
measurement operations, leading 
to more productivity from existing 
machines and reductions in scrap 
and rework. These include laser tool 
setters, contact tool setters, tool 
breakage detectors, touch probes, 
contact scanning systems and  
high-accuracy inspection probes.

(cid:36)(cid:80)(cid:14)(cid:80)(cid:83)(cid:69)(cid:74)(cid:79)(cid:66)(cid:85)(cid:70)(cid:1)(cid:78)(cid:70)(cid:66)(cid:84)(cid:86)(cid:83)(cid:74)(cid:79)(cid:72)(cid:1)
(cid:78)(cid:66)(cid:68)(cid:73)(cid:74)(cid:79)(cid:70)(cid:84)(cid:1)(cid:9)(cid:105)(cid:36)(cid:46)(cid:46)(cid:117)(cid:10)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:84)
Sensors, software and control 
systems for three dimensional 
CMMs, including touch-trigger 
probes, automated probe changers, 
motorised indexing probe heads 
and 5-axis measurement systems, 
that enable the highly accurate 
measurement of manufactured 
components and ﬁnished assemblies.

(cid:52)(cid:85)(cid:90)(cid:77)(cid:74)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:81)(cid:83)(cid:80)(cid:67)(cid:70)(cid:1)(cid:84)(cid:90)(cid:84)(cid:85)(cid:70)(cid:78)(cid:84)
Precision styli that attach to probe 
sensors for CMMs and machine tools 
to ensure that accurate measurement 
data is acquired at the point 
of contact.

(cid:49)(cid:70)(cid:83)(cid:71)(cid:80)(cid:83)(cid:78)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:85)(cid:70)(cid:84)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:84)
Calibration and testing products 
to determine the positioning 
accuracy of a wide range of 
industrial and scientiﬁc machinery 
to international standards, including 
a laser interferometer and wireless 
telescoping ballbar.

(cid:40)(cid:66)(cid:86)(cid:72)(cid:74)(cid:79)(cid:72)
Innovative ﬂexible gauging technology, 
based on the comparison of 
production parts to a reference 
master part, that can greatly increase 
throughput and reduce scrap rates at 
a fraction of the cost of an equivalent 
custom gauging system.

(cid:52)(cid:81)(cid:66)(cid:85)(cid:74)(cid:66)(cid:77)(cid:1)(cid:78)(cid:70)(cid:66)(cid:84)(cid:86)(cid:83)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)
High-speed laser measurement 
and surveying systems for use in 
extreme environments such as marine 
positioning and mine/quarry scanning.

(cid:39)(cid:74)(cid:89)(cid:85)(cid:86)(cid:83)(cid:70)(cid:84)
Modular and custom ﬁxtures used to 
hold parts securely for dimensional 
inspection on CMM, vision and 
gauging systems.

(cid:49)(cid:80)(cid:84)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:70)(cid:79)(cid:68)(cid:80)(cid:69)(cid:70)(cid:83)(cid:84)
Position feedback encoders that 
ensure accurate linear and rotary 
motion control in a wide range 
of applications from electronics, 
ﬂat panel displays, robotics and 
semiconductors to medical, precision 
machining and print production. 
These include magnetic encoders, 
incremental optical encoders, 
absolute optical encoders and laser 
interferometer encoders.

(cid:34)(cid:69)(cid:69)(cid:74)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)(cid:78)(cid:66)(cid:79)(cid:86)(cid:71)(cid:66)(cid:68)(cid:85)(cid:86)(cid:83)(cid:74)(cid:79)(cid:72)(cid:1)(cid:9)(cid:105)(cid:34)(cid:46)(cid:117)(cid:10)
AM and rapid prototyping systems 
that allow the rapid manufacture of 
components as part of a product 
development process or for full-scale 
production, including laser melting 
machines, a range of vacuum, 
nylon and metal casting machines 
and a range of materials to support 
these technologies. AM services 
are also offered, including design 
and simulation, and the contract 
manufacture of metal prototypes and 
production parts.

Open 
here 
for more 
detail...

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Spatial measurement devices overview

In extreme environments, such as offshore, underground, in remote 
areas or in the air, getting the data needed to drive decisions is 
a challenge.
Renishaw’s rugged and reliable spatial laser measurement systems 
help customers in industries as diverse as gold mining, wind 
farming and quarrying to obtain accurate data on a target object’s 
distance, position and orientation, or 3D map entire areas, above 
or below ground.

Using time-of-ﬂight laser technology, 
these systems help customers improve 
safety in dangerous conditions, and 
plan efﬁcient, proﬁtable operations in 
demanding terrains.

Renishaw’s acquisition of Measurement 
Devices Ltd (“MDL”) was completed 
in June 2013. The former MDL 
team, strengthened by experienced 
Renishaw resource in management, 
R&D and production, now forms our 
Renishaw-branded spatial measurement 
products line.

The past 12 months have seen an 
ambitious programme of review 
and development in all areas of the 
business, drawing on Renishaw’s 
research, production, software 
development, business systems and 
commercial expertise, as well as its 
established distribution.

June 2014 saw the launch of the 
ﬁrst Renishaw-branded product 
from the spatial measurement team. 
Quarryman® Pro was designed and 
brought to market in line with Renishaw’s 
bespoke product development process 
to ensure a reliable product that meets

customer and Renishaw requirements. 
The rockface proﬁling laser scanner 
incorporates many customer-requested  
developments to maintain it as the  
default choice to improve the safety, 
efﬁciency and proﬁtability of quarrying 
operations.

Martin Carr, Business Manager, Mining 
Systems, says: “Customers using the 
new Quarryman® Pro alongside the 
Boretrak® system to optimise blasting 
will see a signiﬁcant operational and 
commercial beneﬁt. By accessing 
accurate data on stockpile volume, 
rock burden or borehole deviation more 
quickly, in a wider range of conditions, 
they will be able to gain a much 
greater degree of control over their 
business operations and comply with 
regulatory requirements.

In 25 years of working with quarries, 
including some of the world’s largest 
and most competitive global quarrying 
companies, Quarryman® Pro is the 
best product we have developed, and 
marks the beginning of a new era for 
laser-scanning systems for the mining 
and quarrying sectors.”

In recognition of the strength of 
Renishaw’s products and support 
for the mining and quarrying sector, 
Renishaw has recently signed a 
preferred supplier agreement with 
Lafarge SA, a world leader in building 
materials. This will give Renishaw access 
to Lafarge’s global network of sites and 
afﬁliated businesses. Other ambitious 
programmes of research and 
development are underway for 
marine and mapping markets, as 
well as for laser modules for original 
equipment manufacturers.

Graeme Gordon, Engineering Manager, 
says: “As part of Renishaw we are 
now able to implement an intense, 
focused programme of new product 
development, which brings together 
Renishaw’s expertise on precision 
engineering and project management, 
with our own decades-long history of 
developing measurement tools which 
work where other systems won’t, 
and which deliver data that drives our 
customers to be ever more successful.”

The Dynascan mobile mapping 
system continues to be used for a 
range of innovative mapping projects. 
One project, commissioned by 
Historic Scotland, has seen the spatial 

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measurement team working with 
partners on an ambitious assignment to 
map some of Scotland’s historic sites. 

The work included a unique survey of 
Kisimul Castle, just off the coast of the 
Isle of Barra, known as the “castle in the 
sea” since it is entirely surrounded by 
water and accessible only by boat.

The portability and weather-prooﬁng 
of the mapping systems Renishaw 
produces allowed a boat-mounted 
operation, which enabled this historic, 
unique and inaccessible site to be 
surveyed where traditional techniques 
were not possible.

Karl Bradshaw, Business Manager, 
Mapping Products, says: “The Historic 
Scotland project is something we 
are very proud to be part of, and our 
involvement demonstrates the respect 
the mapping sector has for our products 
and the unique capabilities of the laser 
mapping systems we produce”.

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Our business sectors – Healthcare

Image shows a 3-unit LaserPFM™ framework.
LaserPFM frameworks, created using 
Renishaw’s additive manufacturing technology,
are a cost effective option for the dental 
industry when compared with traditional
manufacturing techniques.

Revenue (-1%)
£28.9m

Operating loss

-£4.0m

Percentage 
of group revenue

8%

Our business sectors – Healthcare

Our technologies are helping within applications such as dentistry, neurosurgery, 
chemical analysis and nanotechnology research. These include products 
and services that allow dental laboratories to manufacture high-quality dental 
restorations, engineering solutions for stereotactic neurosurgery, and analytical tools 
that identify and characterise the chemistry and structure of materials. This illustration 
highlights typical applications for our products within a simulated healthcare facility.

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20-21-22

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

23

The Renishaw DS20 optical scanner uses 
white light 3D scanning technology to provide 
the speed required for obtaining large areas of 
surface data. For applications where greater 
accuracy is required the complementary DS10 
contact scanner can be utilised to form a hybrid 
scanning solution.

Open 
here 
for more 
detail...

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

19

(cid:53)(cid:73)(cid:70)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:1)(cid:83)(cid:66)(cid:79)(cid:72)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:77)(cid:86)(cid:69)(cid:70)(cid:84)(cid:1)
(cid:85)(cid:73)(cid:70)(cid:1)(cid:71)(cid:80)(cid:77)(cid:77)(cid:80)(cid:88)(cid:74)(cid:79)(cid:72)(cid:27)

(cid:37)(cid:70)(cid:79)(cid:85)(cid:66)(cid:77)(cid:1)(cid:84)(cid:68)(cid:66)(cid:79)(cid:79)(cid:70)(cid:83)(cid:84)
3D contact scanners and non-contact 
optical scanners used for digitising 
of dental preparations and for the 
measurement of implant locations 
for tooth-supported frameworks, 
custom abutments and implant 
bridge structures.

(cid:37)(cid:70)(cid:79)(cid:85)(cid:66)(cid:77)(cid:1)(cid:36)(cid:34)(cid:37)(cid:1)(cid:84)(cid:80)(cid:71)(cid:85)(cid:88)(cid:66)(cid:83)(cid:70)
Dental CAD software that allows  
set-up of scanning routines and 
enables laboratory staff to design 
abutments and structures for 
crowns and bridges, including 
strength calculations.

(cid:37)(cid:70)(cid:79)(cid:85)(cid:66)(cid:77)(cid:1)(cid:84)(cid:85)(cid:83)(cid:86)(cid:68)(cid:85)(cid:86)(cid:83)(cid:70)(cid:84)(cid:1)(cid:78)(cid:66)(cid:79)(cid:86)(cid:71)(cid:66)(cid:68)(cid:85)(cid:86)(cid:83)(cid:74)(cid:79)(cid:72)(cid:1)
(cid:84)(cid:70)(cid:83)(cid:87)(cid:74)(cid:68)(cid:70)
A central manufacturing service that 
can handle CAD ﬁles from various 
dental scanning systems to produce 
structures for crowns and bridges in 
zirconia, cobalt chrome, PMMA (a 
transparent thermoplastic) and wax, 
and abutments and implant bridges in 
cobalt chrome.

(cid:47)(cid:70)(cid:86)(cid:83)(cid:80)(cid:84)(cid:86)(cid:83)(cid:72)(cid:74)(cid:68)(cid:66)(cid:77)(cid:1)(cid:83)(cid:80)(cid:67)(cid:80)(cid:85)
A stereotactic robot that provides 
a platform solution for a broad 
range of functional neurosurgical 
procedures including deep 
brain stimulation (“DBS”), 
stereoelectroencephalography 
(“SEEG”), neuroendoscopy, 
stereotactic biopsies and delivery of 
therapeutics deep into the brain.

(cid:47)(cid:70)(cid:86)(cid:83)(cid:80)(cid:84)(cid:86)(cid:83)(cid:72)(cid:74)(cid:68)(cid:66)(cid:77)(cid:1)(cid:81)(cid:77)(cid:66)(cid:79)(cid:79)(cid:74)(cid:79)(cid:72)(cid:1)(cid:84)(cid:80)(cid:71)(cid:85)(cid:88)(cid:66)(cid:83)(cid:70)(cid:1)
Planning software that 
allows advanced planning of 
targets and trajectories for 
stereotactic neurosurgery.

(cid:47)(cid:70)(cid:86)(cid:83)(cid:80)(cid:84)(cid:86)(cid:83)(cid:72)(cid:74)(cid:68)(cid:66)(cid:77)(cid:1)(cid:74)(cid:78)(cid:81)(cid:77)(cid:66)(cid:79)(cid:85)(cid:84)
Implantable devices that allow 
surgeons to verify expected DBS 
electrode position relative to targeted 
anatomy using magnetic resonance 
imaging (“MRI”) for the treatment of 
Parkinson’s disease, other movement 
disorders and neuropathic pain.

(cid:47)(cid:70)(cid:86)(cid:83)(cid:80)(cid:84)(cid:86)(cid:83)(cid:72)(cid:74)(cid:68)(cid:66)(cid:77)(cid:1)(cid:66)(cid:68)(cid:68)(cid:70)(cid:84)(cid:84)(cid:80)(cid:83)(cid:74)(cid:70)(cid:84)
Specialist electrodes and instruments 
for use in epilepsy neurosurgery, 
manufactured by DIXI Medical.

(cid:51)(cid:66)(cid:78)(cid:66)(cid:79)(cid:1)(cid:78)(cid:74)(cid:68)(cid:83)(cid:80)(cid:84)(cid:68)(cid:80)(cid:81)(cid:70)(cid:84)(cid:1)
Scientists and engineers worldwide 
use Renishaw’s research-grade 
inVia Raman microscope for the 
non-destructive chemical analysis 
and imaging of materials. Its high-
speed, high-quality results and 

upgradeability are valued in ﬁelds as 
diverse as nanotechnology, biology 
and pharmaceuticals.

(cid:41)(cid:90)(cid:67)(cid:83)(cid:74)(cid:69)(cid:1)(cid:51)(cid:66)(cid:78)(cid:66)(cid:79)(cid:1)(cid:84)(cid:90)(cid:84)(cid:85)(cid:70)(cid:78)(cid:84)
Renishaw’s hybrid systems unite the 
chemical analysis power of Raman 
spectroscopy with the high spatial 
resolution of other techniques, 
such as atomic force microscopy 
and scanning electron microscopy. 
These new instruments are vital tools 
for investigating materials and devices 
for nanotechnology applications.

(cid:53)(cid:86)(cid:83)(cid:79)(cid:76)(cid:70)(cid:90)(cid:1)(cid:51)(cid:66)(cid:78)(cid:66)(cid:79)(cid:1)(cid:66)(cid:79)(cid:66)(cid:77)(cid:90)(cid:84)(cid:74)(cid:84)
The RA800 benchtop platform 
provides companies with a  
high-performance chemical 
imaging and analysis system that 
can be tailored for the needs of 
their customers. RA800 gives 
research-grade Raman microscopy 
performance in a Class 1 laser-safe, 
simple-to-use form. It is already in 
use at Renishaw Diagnostics Limited 
(“RDL”), where it forms part of RDL’s 
RenDx® RUO Multiplex Assay System, 
developed as a tool for research 
into infectious diseases.

(cid:37)(cid:74)(cid:66)(cid:72)(cid:79)(cid:80)(cid:84)(cid:85)(cid:74)(cid:68)(cid:1)(cid:84)(cid:90)(cid:84)(cid:85)(cid:70)(cid:78)(cid:84)
RDL is in the process of developing 
the RenDx Multiplex Assay System, 
an automated diagnostic platform 
for clinical diagnosis of infectious 
diseases and has launched the RUO 
research system as mentioned above.

Open 
here 
for more 
detail...

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Our markets – Delivering solutions globally

The Group has over 70 locations in 32 countries 
from where we distribute and support products 
for our global customer base, with 93% of sales 
outside the UK. We manufacture our products 
in the UK, Ireland, India, Germany, the USA 
and France.

(cid:48)(cid:86)(cid:83)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:84)(cid:1)(cid:66)(cid:83)(cid:70)(cid:1)(cid:86)(cid:84)(cid:70)(cid:69)(cid:1)(cid:74)(cid:79)(cid:1)(cid:78)(cid:66)(cid:79)(cid:90)(cid:1)(cid:66)(cid:81)(cid:81)(cid:77)(cid:74)(cid:68)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)(cid:13)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:81)(cid:83)(cid:74)(cid:79)(cid:68)(cid:74)(cid:81)(cid:66)(cid:77)(cid:1)(cid:78)(cid:66)(cid:83)(cid:76)(cid:70)(cid:85)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)
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Increasing global demand for food 
products from developing nations

Increasing global demand for biofuels

Greater investment in machinery for 
intensive farming capabilities

Continuing investment in 
manufacturing capacity to meet 
growing global demand

New aircraft production to meet 
growing global demand for civil 
air transport

Improved fuel efﬁciency 
requires tighter tolerances on 
powertrain components

Cost efﬁciencies and automated 
processes required throughout the 
supply chain

New fuel-efﬁcient engines 
with complex parts requiring 
faster measurement

Improvements to fuel efﬁciency 
by minimising airframe weight

Major infrastructure projects driving 
heavy equipment sales

Skills shortages requiring more 
automation in equipment manufacturers

Enhanced safety standards for mines 
necessitate surveying tools

(cid:49)(cid:80)(cid:88)(cid:70)(cid:83)(cid:72)(cid:70)(cid:79)

(cid:46)(cid:70)(cid:69)(cid:74)(cid:68)(cid:66)(cid:77)

(cid:36)(cid:80)(cid:79)(cid:84)(cid:86)(cid:78)(cid:70)(cid:83)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:84)

Manufacture of components for 
civil nuclear and wind energy

Neurological disorders require highly 
precise surgical therapies

Increasing focus on maximising 
output from machinery used in 
power generation

Growing demand for cosmetic 
dentistry with superior aesthetics

Need to rapidly diagnose 
infectious diseases for faster, 
more speciﬁc treatments

Rapid growth in consumer products

New technologies prompting ﬂat 
screen factory investment

New generations of electronic 
devices demand precision 
manufacturing systems

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

25

(cid:44)(cid:70)(cid:90)(cid:1)(cid:71)(cid:66)(cid:68)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)(cid:1)(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)

(cid:52)(cid:73)(cid:66)(cid:79)(cid:72)(cid:73)(cid:66)(cid:74)(cid:13)(cid:1)(cid:36)(cid:73)(cid:74)(cid:79)(cid:66)
Acquired new 18,000 sq ft 
premises for the 
management of our sales, 
marketing, distribution 
and support operations 
throughout China.

(cid:49)(cid:77)(cid:74)(cid:70)(cid:91)(cid:73)(cid:66)(cid:86)(cid:84)(cid:70)(cid:79)(cid:13)(cid:1)(cid:40)(cid:70)(cid:83)(cid:78)(cid:66)(cid:79)(cid:90)
Purchased buildings 
adjacent to our current 
premises in Pliezhausen, 
near Stuttgart, providing 
an additional 116,000 sq ft 
of facilities for our sales 
operations in Germany 
and the LBC additive 
manufacturing business.

(cid:56)(cid:66)(cid:83)(cid:84)(cid:66)(cid:88)(cid:13)(cid:1)(cid:49)(cid:80)(cid:77)(cid:66)(cid:79)(cid:69)
Moved our sales facility to 
larger 5,700 sq ft premises 
near Warsaw’s Chopin 
international airport.

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Nearing completion 
on the additional 
153,000 sq ft facility 
at New Mills with full 
occupation to be 
completed by the ﬁrst 
calendar quarter of 2015.

(cid:46)(cid:74)(cid:84)(cid:76)(cid:74)(cid:79)(cid:13)(cid:1)(cid:54)(cid:44)
Applied for 1.74m sq ft 
of development at our 
Miskin site, of which 
400,000 sq ft would 
be for long-term 
use by Renishaw.

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Performance – Overview

In a year of record revenue, there was a 
continued focus on long-term business 
growth, with strong investments in global 
marketing and distribution infrastructure, 
technology acquisition, new product 
development, manufacturing capacity 
and the recruitment and training of 
skilled staff. 

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Against a backdrop of tough 
comparators due to exceptionally high 
revenue from certain Far East customers 
in the ﬁrst half of the previous year and 
an adverse currency environment, 
we still achieved record revenues. 
There was a continued focus on 
long-term growth of the business, with 
strong investments including global 
marketing and distribution infrastructure, 
technology acquisition, new product 
development, manufacturing capacity 
and the recruitment and training of 
skilled staff. As mentioned previously, 
operating proﬁt was lower, primarily 
due to tough comparators from the 
previous year.

Work continued on a large development 
at our New Mills headquarters, for 
which we have permission ultimately 
to construct a building of up to 
230,000 sq ft. This will allow staff from 
our spectroscopy and calibration 

product lines to relocate to the site from 
their current overcrowded locations, 
and enable us to meet the space 
requirements for our projected future 
growth in R&D resource across all 
product lines and necessary growth in 
corporate support functions. 

A reassessment of strategic 
requirements led to the ﬁrst phase of 
development of the building expanding 
from 120,000 sq ft to 153,000 sq ft, 
although ﬁrst occupancy commenced 
at the end of June 2014, the building is 
expected to be fully completed by the 
end of 2014. The new building is part of 
a wider site re-development which will 
see some existing buildings refurbished 
to allow staff from the calibration and 
spectroscopy product lines to relocate in 
the ﬁrst calendar quarter of 2015. 

At the end of February 2014 we 
submitted a planning application for 
1.74 million sq ft of development at our 
Miskin site, of which 400,000 sq ft would 
be for long-term use by Renishaw. 
A decision from the planning authorities 
on this complex application is expected 
later in 2014. At the existing facility, 
delivery of a large order of new machine 
tools has been completed, providing 
component-machining capacity that 
will allow us to respond quickly to future 
projected demand.

Outside the UK there were further 
investments in group facilities, with 
the acquisition of 18,000 sq ft of space 
in Shanghai, China, for the management 
of our expanding operations in China, 
including provision for product 
demonstration and training. In Germany, 
an additional 116,000 sq ft of facilities 
has been purchased adjacent to our 
current premises near Stuttgart. 
This has allowed the relocation of 
the LBC additive manufacturing 
business acquired last year and also 
provides a rental income from existing 
tenants. In Poland we moved to a new 
5,700 sq ft facility close to Warsaw’s 
Chopin international airport.

Against strong competition for skilled 
engineers, we continued to acquire 
the necessary skills for the current and 
future growth of the business, increasing 
headcount by 257 staff during the year. 
Once again, there was a major drive 
to develop younger staff, resulting in 
a record intake of 68 graduates and 
40 apprentices who will all start their 
careers with Renishaw during summer 
2014. We have recently been recognised 
by The JobCrowd (acclaimed to be 
the UK’s “leading graduate job review 
website”) as one of the top three 
employers of engineering/manufacturing 
graduates in the UK, and applications for 
our graduate scheme have quadrupled 
in the past three years.

Advanced Consulting  
& Engineering, Inc (“ACE”)

ACE staff at their facility in the heart of the 
USA automotive industry.

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The year was always going to be 
challenging, due to tough comparators 
against last year’s record year for 
revenues, which saw a number of 
exceptionally large orders in China 
related to the consumer electronics 
market. The adverse effect on the 
results was also compounded by the 
strengthening of Sterling, which has 
caused a negative impact on revenue of 
£11.2m. 

With the exception of the Far East, and 
despite continuing challenges in the 
Eurozone, all regions saw growth. In fact, 
excluding the exceptional revenue 
from certain customers, in the Far East 
we also achieved underlying revenue 
growth of 11%. This spread of growth 
on a global basis underlines the strength 
of the Group’s product portfolio and 
distribution infrastructure. 

We have continued to see global 
investment in production systems 
and processes for key sectors such 
as aerospace, automotive, energy 
and construction, all of which require 
Renishaw systems to meet their need for 
ever tighter production tolerances and 
cost controls. 

To meet our key strategic aims, 
we continued to make investments 
which this year included focusing on 
supporting our drive to become a 
solutions provider, rather than simply a 
provider of products for integration by 
machine builders, and also to continue 
to develop a strong market presence in 
emerging markets. 

In March 2014 we purchased ACE, a 
supplier of dimensional measurement 
products and services for the 
automotive industry based in the USA. 
The company has over 15 years of 
experience in supplying a range of 
services for demanding applications 
within the automotive sector, including 
contract inspection, ﬁxture design, 
machine retroﬁts, CMM programming 
and full turnkey measurement solutions. 
As we continue to focus on supplying 
end-user metrology solutions, including 
CMM retroﬁts and installations of 
our EquatorTM gauge, the specialist 
knowledge within the ACE team and 
customer relationships in the USA will 
be particularly valuable. 

Renishaw’s ofﬁce in Poland originally 
opened in 2002 with just two staff. 
In February 2014 we formally opened 
a new facility to give improved 
facilities for a market where we 
now have 15 employees. The ofﬁce 
includes purpose-built metrology and 
demonstration rooms, allowing us 
to offer enhanced commercial and 
technical support to our customers 
throughout Polish industry, including 
our spectroscopy product line.

 
 
 
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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Performance – Metrology

The important automotive sector is 
showing positive signs of recovery 
in Europe, with year-on-year growth 
each month since January 2014, whilst 
growth continues to be driven from 
China, where a major programme 
has been announced to scrap older, 
high-polluting vehicles. The global car 
rental market is also forecast to increase 
strongly over the next ﬁve years, with 
higher levels of business and leisure 
travel in markets such as India, China 
and Asia-Paciﬁc. 

In the civil aviation sector the trends are 
also very positive for Renishaw, with the 
2013 Airbus Global Market Forecast 
predicting a doubling of air trafﬁc over 
the next 15 years. The report also sees 
the number of aircraft required in the 
Asia-Paciﬁc region, for example, more 
than doubling over the next 20 years, 
requiring an additional 11,000 aircraft to 
meet expected demand. Our metrology 
products are heavily used in this sector.

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There was strong growth for our AM 
products (for 3D printing in metal), whilst 
for the second consecutive year we 
also experienced good growth for our 
encoder and measurement automation 
product lines. The latter, which is currently 
focused on the award-winning Equator™ 
gauge, is seeing high levels of success in 
the automotive, aerospace and consumer 
electronics sectors on a global basis, 
with integration within automation cells 
continuing to be a notable trend.

The AM products line, which includes 
the LBC business in Germany, is 
continuing to beneﬁt from high levels of 
investment and integration within the 
Group’s infrastructure, including the 
relocation of LBC to our enlarged ofﬁces 
near Stuttgart, Germany. There has 
been signiﬁcant re-engineering of 
the AM machines, plus investments 
in multiple machines for applications 
support and process development, 
and new machines for demonstration 
facilities in major markets. This is now 
bearing fruit and we are seeing strong 
interest from the aerospace, medical, 
motorsport and mould and die sectors. 

As last year, position encoders was 
one of our strongest lines, continuing to 
beneﬁt from a recovery in investments 
into the electronics, semiconductor and 
ﬂat panel display markets, especially 

in the Far East. The business is also 
being aided by the drive to industrial 
automation to increase capacity and 
ﬂexibility, improve product quality and 
reduce manufacturing lead times 
and costs. Such automation requires 
the rapid, reliable and accurate 
measurement of position between 
moving parts delivered by our encoders.

Whilst demand for the encoder product 
line can be unpredictable, our continuing 
infrastructure investments in the Far East 
and agile manufacturing capabilities 
mean that we are very well positioned 
to provide the rapid supply and expert 
local support required by customers 
responding to the fast-paced needs of 
these sectors.

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In the relentless drive to reduce costs, 
shorten lead times and improve 
the quality of ﬁnished products, 
manufacturers continue to adopt the 
latest Renishaw technologies to keep 
machines running reliably, to maximise 
output from those machines and to 
reduce signiﬁcantly the time taken to 
inspect ﬁnished components. The skills 
shortages faced on a global basis 
in engineering and manufacturing is 
also driving increased investments in 
automated processes, many of which 
require our products.

Case study

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Creating the ﬁrst titanium bike frame 
using additive manufacturing technology

Exciting new manufacturing developments enable a lighter bike with the potential for customisation. 

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Renishaw, the UK’s only manufacturer 
of an AM machine that prints metal 
parts, has collaborated with Empire 
Cycles to create the world’s ﬁrst 
additive manufactured bike frame 
made from titanium. 

This mountain bike’s frame is lighter 
than a metal frame made from the 
traditionally used aluminium, whilst 
continuing to be extremely strong, 
corrosion resistant and long lasting.

Although there are lighter carbon ﬁbre 
bikes available, Chris Williams, Managing 
Director at Empire Cycles, stated that 
“the durability of carbon ﬁbre can’t 
compare to a metal bike”. 

Given the innovative approach to making 
the bike parts, testing went beyond 
the normal levels and successfully 
achieved six times the normal standard 
without failure. The bike was designed, 
manufactured and built over a 20-week 
timescale, ready for its debut at the 
Euromold 2013 trade show.

The ﬁnal titanium frame weighed in at 
1,400g compared with 2,100g for an 
aluminium alloy of the same design, a 
33% weight saving. 

Beneﬁts of this type of manufacturing 
are wide; not only was the bike 
lighter and stronger, there are huge 
possibilities for customisation and 
tailoring, as one-offs are as easy to 
produce as production batches.

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See more at 
www.renishaw.com

 
 
 
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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Performance – Metrology continued

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We continue to position Renishaw 
as a “solutions provider” and reduce 
the risks of over-reliance on large 
customers who integrate our products. 
Our measurement automation and 
AM products are supplied direct to 
the end-user, whilst we continue to 
strengthen our portfolio of hardware and 
software for CMMs that can be used to 
upgrade measuring machines already 
installed. For example, during the year 
we launched a new line of metrology 
ﬁxtures, following the purchase of 
R&R Fixtures, LLC (“R&R”) in 2012. 
This allows us to further develop our 
end-user metrology business, whilst 
minimising risk by selling ﬁxtures to 
organisations with which we already 
have a business relationship.

A key focus is on developing technologies 
that provide patented products and 
methods which support our product 
strategies, with £45.3m (net of 
capitalisation costs) expenditure on R&D 
and engineering during the year. 
The current technology focus includes 
miniaturised, high-resolution position 
feedback systems, high-speed, 
high-accuracy dimensional measurement 
systems, and the development of AM 
systems with faster processing capability 
and improved process control for 
large-scale manufacturing.

We also constantly evaluate new 
opportunities for existing or 
complementary technologies both to 
increase sales to our existing customer 
base and to expand upon that base, 
especially within the metal cutting sector. 
This is illustrated by the new SPRINT 
high-speed scanning system for machine 
tools which will develop new high-value 
opportunities with existing customers. 
We also invest in businesses that provide 
complementary technologies and 
skill-sets for faster market access, as 
demonstrated by the purchase of ACE.

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In September 2013, at EMO Hannover, 
the world’s largest metalworking 
industry trade show, we gave full market 
launches to the SPRINT scanning 
system and the new Renishaw ﬁxtures 
product line.

SPRINT is a high-speed contact 
scanning system which incorporates a 
new generation of on-machine scanning 
technology that we believe will open 
up new process control opportunities 
for high-value CNC machine tools. 
It will enable fast and accurate form 
and proﬁle data to be captured from 
prismatic and complex 3D components, 
creating possibilities for sales into the 
aero-engine blade refurbishment market. 

Following the acquisition of R&R, we 
have also developed an extensive new 
range of modular ﬁxturing, designed 
speciﬁcally for CMMs, vision systems 
and the Equator gauging system. 

ATOMTM ultra-compact readhead

AksIM true-absolute magnetic rotary encoder

SPRINTTM contact scanning system for 
machine tools

Case study

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Renishaw encoders at the forefront 
of electronics

The semiconductor industry is unforgivingly fast-paced and competitive. ASM Paciﬁc Technology Limited (“ASMPT”) holds a 
leading position and works with Renishaw at the forefront of continuous technological advances. 

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ASMPT is the world’s largest supplier 
of wafer assembly and packaging 
equipment for the semiconductor 
industry. A wide variety of encoders 
was required for the linear and rotary 
axes of various ASMPT machines. 
Their requirements include excellent 
dirt immunity, compact package 
size and low mass. These features 
guard against airborne contaminants, 
minimise machine footprint and allow 
rapid acceleration of low inertia axes. 

Renishaw optical encoders, from 
the RG2 and RG4 incremental family 
through to the RESOLUTE™ absolute 
series, are ideally suited to ASMPT’s 
most demanding applications. 
Renishaw was the ﬁrst to provide an 
integral set-up LED to allow simple 
readhead installation bringing immediate 
beneﬁt to ASMPT’s production 
efﬁciency. Renishaw’s ultra-high 
accuracy TONiC™ DSi rotary encoder 
system eliminates eccentricity error 
giving cost effective state-of-the-art 
positioning performance. ASMPT and 
their customers beneﬁt further from 
Renishaw’s use of dynamic signal 
processing which ensures the 
highest standards of servo feedback 
performance and axis stability 
throughout the life of the equipment.

ASMPT’s leading position hinges on 
its ability to remain at the forefront of 
technological advances. Renishaw’s 
continuing encoder product 
development supports the latest 
ASMPT equipment - illustrating the 
closed loop of innovation established 
between Renishaw and its customers. 

See more at www.renishaw.com/ASMPT

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32

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Performance – Metrology continued

(cid:48)(cid:86)(cid:85)(cid:77)(cid:80)(cid:80)(cid:76)

We are conﬁdent that there will be 
increased adoption of AM technologies 
by many of our existing customer 
groups, whilst a continuing recovery in 
the electronics sector will beneﬁt our 
position encoder product line. 

The outlook for global investment for 
production systems in civil aviation, 
consumer products, agriculture, 
construction and power generation 
(including oil, gas and renewables) 
continues to look favourable. 
These trends should all result in 
increased demand for our metrology 
products to help drive efﬁciencies, 
reduce waste, increase automation and 
aid product measurement traceability. 

In March 2014 we launched the  
ultra-compact ATOM readhead, 
an innovative optical linear and rotary 
incremental encoder system with 
unrivalled metrology performance that 
uniquely combines miniaturisation 
with leading-edge dirt immunity, signal 
stability and reliability. It is ideally 
suited to a variety of space-critical 
motion control, inspection and 
metrology applications.

Other products introduced during the 
year for our CMM products line include 
the PH10M-iQ PLUS probe head, a new 
version of our market leading PH10 with 
reduced calibration time that is ideal for 
“body-in-white” inspection; the SPA3 
high power, compact CMM ampliﬁer; 
RSP2 V2, a new improved version of 
the REVO 2D scanning probe; and a 
new release of our MODUS metrology 
software (V1.6), which includes surface 
ﬁnish measurement and enhanced 
scanning routines.

There were also two new enhancements 
for the Renishaw Equator gauging 
system. A new process monitoring 
window instantly displays measurement 
results of inspected features on a  
bar-graph display and shows the 
history of measurement on each feature 
so that process trends can be seen. 
Renishaw EZ-IO software provides 
simple comprehensive communication 
functions for automated cells.

For position feedback, our associate RLS, 
launched AksIM, an 18-bit true-absolute 
magnetic rotary encoder for embedded 
OEM motion control applications, 
which is available through Renishaw’s 
worldwide distribution network.

New process monitor software window 
for the Equator gauge.

Performance – Manufacturing

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Following the refurbishments of manufacturing space at the Miskin facility 
in 2013 and the ramp-up of machining, electronics and ﬁnal product 
assembly, the schedule of investment in further capacity has continued 
with two new machining platforms introduced during this ﬁnancial 
year and further investment in ancillary equipment and automation for 
machining and electronics assembly. These investments over the last two 
years have provided additional capacity for the Group and also reduced 
risks by strategic duplication of key processes at this second facility. 
At the Stonehouse facility we are planning to invest in technology that will 
improve recycling of waste generated in the metal cutting processes in 
order to provide further cost savings and reduce our environmental impact.

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34

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Performance – Healthcare

(cid:49)(cid:70)(cid:83)(cid:71)(cid:80)(cid:83)(cid:78)(cid:66)(cid:79)(cid:68)(cid:70)

Growth came from our dental product 
line, with the spectroscopy line only 
slightly ahead of the previous year’s 
record annual sales due to the negative 
impacts of currency. The former was 
boosted by growing demand for 
metal frameworks and abutments 
manufactured by Renishaw on our AM 
machines as mentioned below. 

Demand for our spectroscopy products 
remains strong across nanotechnology, 
advanced materials and life sciences, 
and we have seen a re-emergence of 
investment from the pharmaceutical 
sector. Research sales into advanced 
battery technologies, such as lithium 
ion, were also strong during the year, 
whilst the wider green energy market 
offers a range of advanced materials 
development areas for which Raman 
spectroscopy is well suited. The market 
for graphene research has also been 
particularly strong, and is increasingly 
applications-based rather than solely for 
fundamental R&D. During the year we 
developed a customised version of our 
inVia Raman microscope for monitoring 
the growth of large area graphene in a 
chemical vapour deposition chamber.

Whilst overall revenue for our 
neurosurgical business declined, we 
continued to achieve new sales of the 
neuromate® stereotactic robot which is 
used for functional neurosurgery. In the 
Middle East we made our ﬁrst Qatari 
installation with a sale to the Hamad 
Medical Center in Doha, whilst in the 
Kingdom of Saudi Arabia we achieved 
a signiﬁcant breakthrough when the 
Saudi Food and Drug Authority granted 
marketing authorisation for the sale of 
neuromate. This has already led to the 
installation of a robot at the King Fahad 
Medical City Hospital in Riyadh, which is 
the ﬁrst placement of any neurosurgical 
robot in the Kingdom of Saudi Arabia. 

Elsewhere there were also robots 
installed at a leading UK children’s 
hospital and at the University Hospital in 
Cologne, Germany. We continue to sell 
standalone seats of our neuroinspire™ 
surgical planning software system, 
including a recent installation at the 
Charing Cross Hospital, London.

quantitative easing effects impacting 
on different governments’ priorities 
on research spending. However, as 
our Raman spectroscopy systems 
are ideally suited to many priority 
research areas, we feel customers for 
our systems are well placed to contest 
for the available research funding.

(cid:52)(cid:85)(cid:83)(cid:66)(cid:85)(cid:70)(cid:72)(cid:90)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:72)(cid:83)(cid:80)(cid:88)(cid:85)(cid:73)(cid:1)

We aim to develop innovative healthcare 
products that will signiﬁcantly advance 
our customers’ operational performance 
by maximising research capabilities, 
reducing process times and improving 
the efﬁcacy of medical procedures.

As a key Renishaw focus is to develop 
technologies that provide patented 
products and methods, we invested 
£8.0m (net of capitalisation costs) of 
expenditure on R&D and engineering 
during the year. The regulatory 
requirements for healthcare products 
demand signiﬁcant investment, 
but make barriers to entry high for 
competitive products. 

Our metrology and healthcare 
businesses are interconnected and we 
employ core metrology technologies 
and manufacturing expertise to minimise 
technology risks. This is illustrated very 
clearly in our dental CAD/CAM scanners 
and the zirconia milling systems that we 
use in our dental structure production, 
which utilise proven measurement 
sensors, encoders, software and our 
knowledge of subtractive machining, 
whilst, as mentioned previously, we 
also produce a range of 3D printed 
metal dental structures on Renishaw 
AM machines.

During the year we again achieved a 
new record for the production levels 
of metal dental structures created 
from cobalt chrome powder using 
AM. We now have a strong portfolio 
of products manufactured using 
this process including LaserPFM™ 
frameworks (crowns and bridges), 
LaserBridges™ for implant supported 
frameworks (using a hybrid of AM 
and conventional 5-axis machining 
to achieve a high quality of ﬁt) and 
Laser Abutments™ which are implant 
supported custom abutments that are 
also machine ﬁnished for ﬁtment (a 
custom abutment is a prosthetic device 
inserted into an implant to replace 
natural dentition and provide functional 
support for a crown). We continue to 
beneﬁt from offering dental materials 
that are fully certiﬁed and traceable, and 
a central manufacturing facility to dental 
laboratories that use non-Renishaw 
CAD systems.

(cid:46)(cid:66)(cid:83)(cid:76)(cid:70)(cid:85)(cid:1)(cid:68)(cid:80)(cid:79)(cid:69)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)

Life expectancy is increasing in both 
developed and developing markets, 
meaning that key drivers include the 
requirement for faster procedures to 
reduce waiting times, more economical 
treatments and safer procedures with 
reduced human errors. Our dental and 
neurological products are well placed to 
deliver on these requirements. 

The global funding picture remains 
stronger for biomedical research than 
for some markets. There is variation in 
research investment, with currency and 

Case study

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Pioneering AM reshapes patient’s face

Motorcycle trauma victim, Stephen Power has seen ﬁrst-hand the beneﬁts of surgeons and engineers working together and how 
the outcome can change a person’s life. 

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A horriﬁc incident left Stephen with 
multiple skull fractures that changed 
his life and meant he would require 
reconstructive surgery.

Despite the recent introduction of AM to 
create bespoke maxillofacial implants, 
the surgical procedure itself still remains 
time consuming and onerous. 

However, Professor Adrian Sugar, 
consultant in Cleft & Maxillofacial 
Surgery at the Morriston Hospital 
in Swansea, was keen to push 
the boundaries of his profession 
and embrace new techniques 
and processes.

Renishaw worked in collaboration with 
the Centre for Applied Reconstructive 
Technologies in Surgery (CARTIS) in 
South Wales, to provide Morriston 
Hospital with the bone cutting jig 
and implant placement guide that 
made the surgery quicker and more 
accurate. The metal jig and guide were 
manufactured on a Renishaw AM250 
AM machine.

Professor Sugar felt that the jig and 
guide resulted in a more predictable 
outcome and said: “I think its 
incomparable - the results are in a 
different league from anything we’ve 
done before”. Stephen’s response 
was even more emphatic: “It is totally 
life-changing”.

See more at 
www.renishaw.com

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36

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Performance – Healthcare continued

We also apply AM to an increasing 
number of healthcare applications. 
The metal delivery port of an 
investigational drug delivery system 
(see below) is manufactured using a 
combination of AM and conventional 
machining, and also during the year 
we worked with a leading maxillofacial 
surgeon and other partners to print 
metal cutting and placement guides 
for breakthrough facial reconstruction 
surgery (see page 35).

We also actively consider acquiring 
businesses and/or technologies that we 
feel are complementary to our existing 
healthcare products.

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During the year we launched 
StreamLineHR™ Rapide for our inVia 
Raman microscopes. This dramatically 
increases the speed of Raman imaging 
and, coupled with the large ﬁle handling 
capacity introduced last year, enables 
customers to collect highly detailed 
chemical images faster than ever before. 
We also enhanced 3D Raman image 
viewing so that biological cells and other 
structures can be clearly visualised, 
and added a new capability known as 
Surface, so that data can be collected 
from sloping or uneven sample surfaces.

There were also new releases within 
our dental line. During the year we 
introduced Realistic™, a highly 
translucent zirconia material that allows 
dental laboratories to design lifelike 
crowns using CAD software programs 
such as Renishaw’s Dental Studio™. 
Using Realistic there is no longer the 
need to apply porcelain to machined 
crowns, as these require only a quick 
stain and glaze ﬁnish to achieve the 
desired tooth characteristics and 
therefore save dental laboratories time 
and money. With growing interest in 
the use of AM for dental restorations, 
we are now selling our AM machines 
speciﬁcally tailored to the needs of the 
dental market. A ‘dental-ready’ add-
on package is an option that can be 
supplied with machines purchased 
by dental customers ensuring that 
the machines are ﬁne-tuned for the 
production of dental structures in cobalt 
chrome powder.

Towards the end of the year the FDA 
issued Renishaw clearance to market 
the neuromate stereotactic robotic 
system in the USA. This represents 
a signiﬁcant opportunity for our 
neurosurgical product line as the 
USA is the world’s largest market 
for medical devices. 

We are also manufacturing an 
investigational drug delivery system to 
the speciﬁcation required by an NHS 
Trust, which is conducting a clinician-
led clinical trial for a therapy for the 
treatment of Parkinson’s disease. 
The system, which delivers therapies 
directly into the brain, is also on trial by 
the Trust to deliver a chemotherapy drug 
for the treatment of brain tumours. 

(cid:48)(cid:86)(cid:85)(cid:77)(cid:80)(cid:80)(cid:76)(cid:1)

Increased life expectancy on a global 
basis means greater incidences of 
degenerative neurological diseases 
which will require surgical therapies. 
With new regulatory approvals we 
are increasingly well placed to supply 
neurosurgeons with the products and 
techniques to support such procedures. 

In developing markets, levels of wealth 
are increasing at a national and individual 
level, which are driving demand for 
higher-quality medical treatments, 
often requiring more technologically 
advanced products. 

The market for Raman spectroscopy 
continues to grow in ﬁelds such as 
nanotechnology, advanced materials 
and life sciences.

Metal dental framework produced on a 
Renishaw AM machine

Dental crowns produced from a RealisticTM 
zirconia material

Raman image of titanium coated drill bit 
using Surface

Case study

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Neurosurgical advances change future

Renishaw’s neuromate robot has dramatically changed the life of Stella, a 13 year old who has suffered from up to 100 potentially 
life threatening epilepsy attacks every day since the age of 1. 

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Immediately after surgery, Stella’s 
seizures stopped and she has 
been seizure-free now for 2 years. 
A life changing success story for the 
whole family.

Stella (aged 13) developed severe 
epilepsy when she was 1 year old 
and subsequently endured up 
to 100 potentially life threatening 
seizures every day. Over 10 years, 
she underwent 5 invasive surgical 
procedures, and after every 
procedure, the seizures returned 
immediately, often more violently 
than before.

For Stella’s family, their last hope was 
at the Niguarda Ca’ Granda hospital 
in Milan, Italy where the neurosurgical 
team are pioneering the use of the 
Renishaw neuromate® stereotactic 
robot as a tool during the treatment 
of epilepsy. Due to the precision 
and stability of the neuromate the 
surgical team were able to implant 
stereoelectroencephalography (“SEEG”) 
electrodes deep into the brain, enabling 
an accurate mapping of the source of 
the seizures. A subsequent surgery 
was then carried out to remove the 
identiﬁed section. 

See more at 
www.renishaw.com

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Performance – Financial review

Allen Roberts
Group Finance Director

The Group has had another record year 
for revenue of £355.5m (2013: £346.9m), 
including a record quarterly revenue of 
£107.0m in the ﬁnal 3 months of the year.

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In accordance with EU law, the 
consolidated ﬁnancial statements of the 
Company are prepared in accordance 
with IFRS adopted by the EU. 
The Company has elected to prepare its 
parent company ﬁnancial statements in 
accordance with UK GAAP (Generally 
Accepted Accounting Practice).

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(cid:51)(cid:70)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)fi(cid:72)(cid:86)(cid:83)(cid:70)(cid:84)
Restated ﬁgures are in respect of the 
amendment to IAS 19 “Employee 
beneﬁts” (mandatory for years 
commencing on or after 1st January 
2013), where the expected return on 
plan assets and the interest cost on 
liabilities in the income statement are 
replaced by interest on the net deﬁned 
beneﬁt asset/liability using the discount 
rate used to measure the deﬁned beneﬁt 
obligation. This changes the allocation of 
the total return on plan assets between 
the income statement and other 
comprehensive income. 

Working capital £m

Capital expenditure £m

% of revenue

(cid:18)(cid:20)(cid:17)(cid:15)(cid:22)

105.1

97.6

75.7

26.2%
2011

(cid:20)(cid:23)(cid:15)(cid:24)(cid:6)

(cid:19)(cid:17)(cid:18)(cid:21)

30.3%

2013

29.4%

2012

(cid:20)(cid:26)(cid:15)(cid:19)

(cid:18)(cid:24)(cid:15)(cid:26)

Plant and vehicles

Land and buildings

30.3

28.0

16.7

21.1

16.5

11.1

13.6

2012

5.4

2011

6.9

2013

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(cid:19)(cid:17)(cid:18)(cid:21)

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Far East, including Australasia

Continental Europe

North, South and Central America

UK and Ireland

Other regions

Total group revenue

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(cid:66)(cid:85)(cid:1)(cid:66)(cid:68)(cid:85)(cid:86)(cid:66)(cid:77)(cid:1)
(cid:70)(cid:89)(cid:68)(cid:73)(cid:66)(cid:79)(cid:72)(cid:70)(cid:1)(cid:83)(cid:66)(cid:85)(cid:70)(cid:84)(cid:1)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

Change  
from  
2013  
%

2014 revenue  
at 2013  
exchange rates 
£’000

Change 
 from  
2013  
%

2013 revenue  
at actual  
exchange rates 
£’000

(cid:18)(cid:20)(cid:21)(cid:13)(cid:22)(cid:23)(cid:26)

(cid:18)(cid:17)(cid:17)(cid:13)(cid:18)(cid:26)(cid:26)

(cid:25)(cid:22)(cid:13)(cid:22)(cid:23)(cid:19)

(cid:19)(cid:20)(cid:13)(cid:25)(cid:18)(cid:23)

(cid:18)(cid:18)(cid:13)(cid:20)(cid:22)(cid:19)

(cid:20)(cid:22)(cid:22)(cid:13)(cid:21)(cid:26)(cid:25)

-3%

+4%

+8%

+15%

-7%

+2%

141,194

101,086

89,123

23,816

11,487

366,706

+2%

+5%

+13%

+15%

-6%

+6%

138,806

96,003

79,220

20,668

12,184

346,881

The amended standard is required to be 
applied retrospectively. As a result of the 
restatement, proﬁt before tax for the year 
ended 30th June 2013 decreased by 
£2.3m (see note 1).

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Adjusted ﬁgures apply to both the current 
and previous ﬁnancial years. For the 
year ended 30th June 2013, adjusted 
ﬁgures exclude the exceptional gain of 
£2.9m resulting from the early settlement 
of the deferred consideration liability 
for the purchase of the remaining 34% 
shareholding in Measurement Devices 
Limited. For the year ended 30th June 
2014, adjusted ﬁgures exclude the 
proﬁt on disposal of the shareholding in 
Delcam plc of £26.3m (see note 4).

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The Group has had another record year 
for revenue of £355.5m (2013: £346.9m), 
including a record quarterly revenue of 
£107.0m in the ﬁnal 3 months of the year. 

This was achieved against a signiﬁcant 
strengthening of Sterling in the second 
half of the year and substantial sales 
of products last year to a number of 
Far East customers in the consumer 
electronics industry which were not 
repeated to the same extent in the 
current year. Adjusting for these items, 
there was underlying revenue growth 
of 11%.

The Group has continued to invest in  
its production facilities, sales and 
marketing resource and research and 
development activities and the resulting 
increased cost base, combined with 
adverse currency effects, has led to 
an adjusted proﬁt before tax for the 
year of £70.1m (2013: a restated and 
adjusted £79.2m). 

(cid:51)(cid:70)(cid:87)(cid:70)(cid:79)(cid:86)(cid:70)

Group revenue for the year was 
£355.5m, an increase of £8.6m, or 2%, 
over the previous year of £346.9m. 
Revenue would have been £11.2m 
higher at the previous year’s exchange 
rates. There was growth of 8% in the 
Americas, 4% in Europe and 15% in the 
UK and in the Far East, adjusting for 
the unrepeated substantial consumer 
electronics industry orders mentioned 
above, we experienced an underlying 
growth of 18%.

The Group hedges a proportion of its 
revenue by the use of forward contracts, 
which partially mitigated the impact of a 
stronger Sterling, limiting the reduction in 
revenue by £5m to £11.2m.

The table above shows the analysis of 
group revenue by geographical market.

In our metrology business segment, 
revenue grew by 3%, from £317.9m last 
year to £326.6m this year. Revenue in 
our healthcare business segment was at 
a similar level to last year, at £28.9m.

A geographical analysis of our metrology 
and healthcare businesses is shown in 
the Strategic report on page 25.

(cid:49)(cid:83)ofit and tax(cid:1)

The group adjusted proﬁt before tax 
amounted to £70.1m (2013: a restated 
and adjusted £79.2m). At the previous 
year’s exchange rates, the adjusted 
proﬁt before tax would have been 
£6.8m higher.

Statutory proﬁt before tax, which 
includes the proﬁt on disposal of our 
shareholding in Delcam plc of £26.3m 
for the current year and includes £2.9m 
resulting from the early settlement of a 
deferred consideration liability for the 
previous year, was £96.4m, compared 
with £82.1m last year.

In our metrology business, operating 
proﬁt was £74.4m, compared with 
£84.5m last year. In our healthcare 
business we recorded an operating 
loss of £4.0m, compared with a loss of 
£5.4m last year, as we target at least a 
breakeven run rate towards the end of 
this ﬁnancial year.

The overall effective rate of tax was 
11.1% (2013: 18.3%), and 15.3% 
(2013: 19.0%) after excluding the 
exceptional items which were non-
taxable. This reﬂects a combination 
of the varying tax rates applicable 
throughout the countries in which 
the Group operates. In the UK, the 

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40

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Performance – Financial review continued

tax charge includes a £1.3m beneﬁt 
(2013: £0.3m) arising from the patent 
box tax rate, which took effect from 
April 2013, along with a lower UK 
current corporation tax rate of 22.5% 
for this ﬁnancial year (2013: 23.75%). 
A tax rate of 20% (2013: 23%) has 
been used for UK deferred tax 
calculations. The effective rate of tax 
will beneﬁt further next year from the 
reduction in the UK tax rate and the 
phased introduction of the patent box 
tax initiative.

(cid:38)(cid:66)(cid:83)(cid:79)(cid:74)(cid:79)(cid:72)(cid:84)(cid:1)(cid:81)(cid:70)(cid:83)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:1)(cid:9)(cid:105)(cid:70)(cid:81)(cid:84)(cid:117)(cid:10)(cid:1)
(cid:66)(cid:79)(cid:69)(cid:1)(cid:69)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)

Adjusted eps, excluding the exceptional 
item, decreased from a restated 88.9p 
last year to 82.3p this year. Statutory eps 
was 118.4p, compared with a restated 
92.9p last year.

A ﬁnal dividend of 29.87p net per share 
results in a total dividend for the year 
of 41.2p, an increase of 3% over the 
40.0p in 2013. Dividend cover based 
on adjusted eps is 2.0 times (2.9 times 
when based on statutory eps) and 
compares with 2.2 times (statutory 
2.3 times) last year.

(cid:51)(cid:70)(cid:84)(cid:70)(cid:66)(cid:83)(cid:68)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)

Gross expenditure on engineering costs, 
including research and development 
on new products, was £56.8m 
(2013: £51.8m). The capitalisation of 
development costs (net of amortisation 
charges) amounted to £3.5m 
(2013: £3.1m), giving a net charge in 
the Consolidated income statement 
of £53.3m (2013: £48.7m). The gross 
charge amounts to 16% of group 
revenue (2013: 15%).

Between the business segments, net 
of the capitalisation costs, £45.3m 
(2013: £40.2m) was spent in the 
metrology segment and £8.0m 
(2013: £8.5m) was spent in our 
healthcare segment.

New product research and development 
expenditure amounted to £36.3m, 
which compares with £33.9m spent 
last year. There have been a number 
of new product releases in both our 
metrology and healthcare business 
segments, and there is an extensive new 
product pipeline with a number of new 
product introductions anticipated in this 
ﬁnancial year.

(cid:40)(cid:83)(cid:80)(cid:86)(cid:81)(cid:1)(cid:73)(cid:70)(cid:66)(cid:69)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)

Group headcount has increased from 
3,235 at 30th June 2013 to 3,492 
at 30th June 2014, with the average 
for the year of 3,345, compared with 
3,092 last year. The year end increase 
of 257 comprised additional staff 
of 157 in the UK and 100 overseas. 
The 157 staff increase in the UK 
included 43 apprentices and 59 
graduates, and, in addition, we sponsor 
35 students at universities across the 
UK, demonstrating our commitment 
to the training and development of 
skilled staff within our engineering and 
commercial functions. As a result, labour 
costs increased by 7% to £146.9m 
(2013: £137.3m) reﬂecting the additional 
staff in the Group’s production, sales 
and marketing and research and 
development activities and the full year 
cost of staff taken on last year.

(cid:36)(cid:80)(cid:79)(cid:84)(cid:80)(cid:77)(cid:74)(cid:69)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)(cid:67)(cid:66)(cid:77)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:84)(cid:73)(cid:70)(cid:70)(cid:85)(cid:1)

The Group’s shareholders’ funds at 
the end of the year were £352.8m, an 
increase of £74.7m over the £278.1m 
at 30th June 2013, and comprise an 
increase in retained reserves.

Additions to tangible ﬁxed assets totalled 
£39.2m, of which £21.3m was spent 
on property and £17.9m on plant and 
machinery, IT equipment and vehicles.

The main property additions were: 

(cid:116)(cid:1) at New Mills, construction has 

continued on a 153,000 sq ft building 
for our head ofﬁce and research and 
development facilities with phased 
occupancy planned to take place over 
the next six months;

(cid:116)(cid:1) in Shanghai, China, the Group has 
acquired and relocated to new 
premises for the management of our 
sales, marketing, distribution and 
support operations throughout China;

(cid:116)(cid:1) in Germany, we have purchased 
buildings adjacent to our current 
premises in Pliezhausen, near 
Stuttgart, providing an additional 
116,000 sq ft of facilities for our 
German subsidiary into which the LBC 
additive manufacturing business has 
relocated; and

(cid:116)(cid:1) in Warsaw, our Polish sales subsidiary 

has moved to larger premises.

Work has continued on implementing 
a virtual machine environment in the 
UK and regional data centres to further 
enhance the resilience and efﬁciency of 
the Group’s IT infrastructure.

Intangible ﬁxed assets increased by 
£0.5m during the year, from £56.1m to 
£56.6m. Additions included capitalised 
research and development expenditure 
of £3.5m (net of annual amortisation 
charges) and £0.5m relating to an 
acquisition in the USA (see commentary 
under the Acquisition heading below). 

Within working capital, inventories 
decreased to £63.0m from £65.3m 
at the beginning of the year reﬂecting 
record demand for products in the 
last quarter of the year and continuing 
improvement in the group inventory 
management systems. Trade debtors 
increased from £68.1m to £81.8m in 
line with trading levels, with debtor days 
outstanding at the end of the current 
year at 63 days (2013: 62 days).

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

41

Cash balances at 30th June 2014 
were £43.6m (2013: £26.6m) and 
beneﬁted from the £32.0m proceeds 
from the disposal of our shareholding 
in Delcam plc. 

As noted below under Treasury policies, 
the Group uses forward contracts to 
hedge against future foreign currency 
inﬂows. At the end of the year these 
contracts had a cumulative gain of 
£25.6m, net of tax, compared with a 
deﬁcit of £0.7m at the start of the year. 
This has increased shareholders’ equity 
by £26.3m over the year.

At the end of the year, the Group’s 
deﬁned beneﬁt pension funds, now 
closed for future accrual, showed a 
deﬁcit of £43.1m, compared with a 
deﬁcit of £41.7m at 30th June 2013. 
Deﬁned beneﬁt pension scheme assets 
at 30th June 2014 increased to £129.8m 
from £118.8m at 30th June 2013, 
representing investment performance 
during the year. Pension fund liabilities 
increased from £160.5m to £172.8m, 
reﬂecting the market rates at 
30th June 2014.

The Company has given a guarantee 
relating to recovery plans for the UK 
deﬁned beneﬁt pension scheme deﬁcit, 
which is supported by registered 
charges over certain UK properties 
and an escrow account with a cash 
balance of £9.5m at 30th June 2014 
(2013: £11.0m). The application of 
IFRIC14 increased pension scheme 
liabilities by £8.0m (2013: £10.3m).

For the UK deﬁned beneﬁt pension 
scheme, a guide to the sensitivity of the 
value of the liabilities is as follows:

Valuation sensitivity
Discount rate
Inﬂation

Approximate 
effect on 
liabilities

£3.5m

£2.9m

Variation

0.1%

0.1%

(cid:34)(cid:68)(cid:82)(cid:86)(cid:74)(cid:84)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)

In March 2014, the Group purchased 
Advanced Consulting & Engineering, 
Inc (“ACE”), a USA-based supplier of 
dimensional measurement products 
and services focused on the automotive 
industry. The acquisition of family-owned 
ACE, based in Rochester Hills, Michigan, 
provides Renishaw with further specialist 
programming capabilities using leading 
industry packages and will help to 
support Renishaw’s sales of co-ordinate 
measuring machine probing systems 
and Equator gauges in the USA. 

(cid:53)(cid:83)(cid:70)(cid:66)(cid:84)(cid:86)(cid:83)(cid:90)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:70)(cid:84)

The Group’s treasury policies are 
designed to manage ﬁnancial risks to 
the Group that arise from operating 
in a number of foreign currencies and 
to maximise interest income on cash 
deposits. As an international group, the 
main exposure is in respect of foreign 
currency risk on the trading transactions 
undertaken by group companies and 
on the translation of the net assets of 
overseas subsidiaries.

The information below includes 
disclosures which are required by 
IFRS and are an integral part of the 
ﬁnancial statements. Weekly groupwide 
cash management reporting and 
forecasting is in place to facilitate 
management of this currency risk. 
The operations of group treasury, which 
is situated at head ofﬁce, are governed 
by Board-approved policies.

All Sterling and foreign currency 
balances not immediately required 
for group operations are placed 
on short-term deposit with 
leading international highly-rated 
ﬁnancial institutions.

The Group uses a number of ﬁnancial 
instruments to manage foreign 
currency risk, such as foreign currency 
borrowings to hedge the exposure 
on the net assets of the overseas 
subsidiaries and forward exchange 
contracts to hedge a signiﬁcant 
proportion of anticipated foreign 
currency cash inﬂows. 

There are forward contracts in place 
to hedge against the Group’s Euro, US 
Dollar and Japanese Yen cash inﬂows.
Also, currency contracts are used to 
minimise the interest cost of maintaining 
the currency borrowings. The foreign 
currency borrowings are short-term 
with ﬂoating interest rates. The Group 
does not speculate with derivative 
ﬁnancial instruments.

See note 22 for an analysis of cash 
balances and currency borrowings at 
the year end.

(cid:42)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:71)(cid:86)(cid:85)(cid:86)(cid:83)(cid:70)

In recent years, the Group has made 
a number of small niche-market 
acquisitions, which have broadened the 
Group’s range of products and markets 
in both our metrology and healthcare 
businesses. We have also invested 
signiﬁcantly in expanding our research 
and development resources, production 
capacity and our marketing and support 
infrastructure. We will continually look 
to the long-term growth of the Group 
and to invest in R&D, manufacturing 
and production processes to ensure 
capacity for the future, and expand our 
marketing and support presence around 
the world.

Allen Roberts 
Group Finance Director
23rd July 2014

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42

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Key performance indicators

The Group’s long-term aim is to achieve sustainable growth in 
revenue and proﬁts in order to provide an increasing dividend to 
shareholders. This is to be achieved through substantial investment 
in people and in research and development of new products and 
processes, acquisition of niche businesses complementary to and 
supporting the Group’s strategic development aims, the application 
of technologies into different market areas and the development 
of its global marketing facilities. The main performance measures 
monitored by the Board are:

(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:44)(cid:49)(cid:42)(cid:84)

Revenue growth £m

(cid:20)(cid:22)(cid:22)(cid:15)(cid:22)

346.9

331.9

288.7

Total engineering costs 
including research and 
development £m

Adjusted earnings  
per share pence

Dividend per share  
pence

Included in the Consolidated 
income statement

(cid:22)(cid:23)(cid:15)(cid:25)

Gross expenditure

51.8

48.7

47.9

(cid:22)(cid:20)(cid:15)(cid:20)

45.0

40.0

37.1

95.6

88.9

(cid:25)(cid:19)(cid:15)(cid:20)

88.5

(cid:21)(cid:18)(cid:15)(cid:19)

40.0

38.5

35.0

(cid:19)(cid:17)(cid:18)(cid:21)

2013

2012

2011

(cid:19)(cid:17)(cid:18)(cid:21)

2013

2012

2011

(cid:19)(cid:17)(cid:18)(cid:21)

2013

2012

2011

(cid:19)(cid:17)(cid:18)(cid:21)

2013

2012

2011

We are focused on growth in 
revenue, through increasing 
our market and geographic 
penetration and continually 
introducing new products. 
We have also made a number 
of acquisitions over the last 
ﬁve years which expand our 
product range and will support 
revenue growth by using the 
Group’s worldwide marketing 
and distribution infrastructure to 
expand these businesses.

The growth of the business 
is fundamentally dependent 
on the continuing investment 
in engineering costs for the 
development of new products 
and processes. The Group 
continues to make signiﬁcant 
investment in future products, 
with engineering costs equal 
to approximately 16% of group 
revenue, and has also been 
accelerating new product 
development in certain areas.

In order to provide an increasing 
return to shareholders, along 
with retaining adequate funds 
for reinvestment in the business, 
we aim to achieve year-on-year 
growth in earnings per share.

We aim to achieve signiﬁcant 
long-term returns to shareholders 
by maintaining a progressive 
dividend policy, whilst 
maintaining a solid capital base 
with sufﬁcient working capital to 
support the forecast growth.

Further strategic priorities are set out on page 7

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

43

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Training is key to our future growth and the Renishaw Academy gives our engineers the skills to deliver expert customer support.

Non-financial KPIs
Non-financial KPIs

Staff turnover % 

Number of apprentices 
in training

Training 

Health and safety 

Renishaw staff turnover 
as compared to the UK 
average also shown.

9.5%

(cid:25)(cid:15)(cid:17)(cid:6)

8.0%

9.3%

(cid:22)(cid:15)(cid:17)(cid:6)

(cid:19)(cid:17)(cid:18)(cid:21)

3.2%

2013

6.0%

5.5%

2012

2011

We continue to train, develop 
and reward our staff so that 
we retain a skilled and effective 
workforce. Our aim is to 
maintain a UK staff turnover rate 
which is below the UK average 
for the manufacturing and 
production sector.

(cid:18)(cid:17)(cid:22)

71

(cid:19)(cid:17)(cid:18)(cid:21)(cid:11)

2013

51

33

2012

2011

Number of new placements 
and members of the graduate 
and apprenticeship  
schemes 

Total lost working time injuries per 
100,000 hours worked

(cid:18)(cid:17)(cid:25)

(cid:23)(cid:25)

(cid:21)(cid:17)

(cid:19)(cid:17)(cid:18)(cid:21)(cid:11)

94

55

24
2013

80

40

25
2012

85

30
20
2011

0.04

(cid:17)(cid:15)(cid:17)(cid:20)

0.03

0.02

(cid:19)(cid:17)(cid:18)(cid:21)

2013

New placements

New graduates

New apprenticeships

2012

2011

We believe we need to provide 
many options for career entry for 
young people and we are proud 
of our apprentice programme 
and the success it has achieved 
both for the apprentices that 
have trained with us and for 
Renishaw in terms of solving 
skills gaps. In a period of growth, 
we intend to increase the 
numbers of apprentices taken 
into training each year.

Renishaw’s strategy is to 
grow organically and therefore 
developing students and 
taking on apprentices and 
graduates forms a key element 
of our strategy. Dependent on 
economic conditions, we propose 
to increase year-on-year the 
number of new apprenticeships, 
graduates and student 
placements we take on.

* Figures relate to the academic year September to August

In a manufacturing environment, 
it is crucial that we maintain 
high standards of health and 
safety. Our aim is to have zero 
fatalities and zero lost working 
time injuries (meaning injuries 
involving more than seven lost 
working days).

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44

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Principal risks and uncertainties

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:85)(cid:83)(cid:66)(cid:69)(cid:74)(cid:79)(cid:72)(cid:1)(cid:77)(cid:70)(cid:87)(cid:70)(cid:77)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:80)(cid:83)(cid:69)(cid:70)(cid:83)(cid:1)(cid:67)(cid:80)(cid:80)(cid:76)

(cid:51)(cid:70)(cid:87)(cid:70)(cid:79)(cid:86)(cid:70)(cid:1)(cid:72)(cid:83)(cid:80)(cid:88)(cid:85)(cid:73)(cid:1)(cid:74)(cid:84)(cid:1)(cid:86)(cid:79)(cid:81)(cid:83)(cid:70)(cid:69)(cid:74)(cid:68)(cid:85)(cid:66)(cid:67)(cid:77)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)
(cid:80)(cid:83)(cid:69)(cid:70)(cid:83)(cid:84)(cid:1)(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:68)(cid:86)(cid:84)(cid:85)(cid:80)(cid:78)(cid:70)(cid:83)(cid:84)(cid:1)(cid:72)(cid:70)(cid:79)(cid:70)(cid:83)(cid:66)(cid:77)(cid:77)(cid:90)(cid:1)(cid:74)(cid:79)(cid:87)(cid:80)(cid:77)(cid:87)(cid:70)(cid:1)
(cid:84)(cid:73)(cid:80)(cid:83)(cid:85)(cid:1)(cid:77)(cid:70)(cid:66)(cid:69)(cid:14)(cid:85)(cid:74)(cid:78)(cid:70)(cid:84)(cid:1)(cid:88)(cid:74)(cid:85)(cid:73)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:80)(cid:86)(cid:85)(cid:84)(cid:85)(cid:66)(cid:79)(cid:69)(cid:74)(cid:79)(cid:72)(cid:1)
(cid:80)(cid:83)(cid:69)(cid:70)(cid:83)(cid:1)(cid:67)(cid:80)(cid:80)(cid:76)(cid:1)(cid:66)(cid:85)(cid:1)(cid:66)(cid:79)(cid:90)(cid:1)(cid:85)(cid:74)(cid:78)(cid:70)(cid:1)(cid:67)(cid:70)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:83)(cid:80)(cid:86)(cid:79)(cid:69)(cid:1)
(cid:80)(cid:79)e m(cid:80)(cid:79)(cid:85)(cid:73)(cid:8)(cid:84)(cid:1)(cid:88)(cid:80)(cid:83)(cid:85)(cid:73)(cid:1)(cid:80)(cid:71)(cid:1)(cid:83)(cid:70)(cid:87)(cid:70)(cid:79)(cid:86)(cid:70)(cid:1)(cid:87)(cid:66)(cid:77)(cid:86)(cid:70)(cid:15)

Potential impact

Global market conditions continue to 
highlight risks to growth and demand 
which can lead to ﬂuctuating levels 
of revenue. 

Whilst global investment in production 
systems and processes is expected to 
expand, future growth is difﬁcult to predict, 
especially with such a short-term order 
book. This limited forward order 
visibility leaves the annual revenue 
forecasts uncertain.

Mitigation
(cid:116)(cid:1)  The Group is expanding and diversifying 
its product range in order to maintain 
a world-leading position in its sales of 
metrology products. 

(cid:116)(cid:1) The Group is applying its measurement 

expertise to grow its healthcare 
business activities.

(cid:116)(cid:1) The Group regularly monitors the 
integration of acquisitions which 
expand its product range in new and 
complementary market sectors. 

(cid:51)(cid:70)(cid:84)(cid:70)(cid:66)(cid:83)(cid:68)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)

(cid:53)(cid:73)(cid:70)(cid:1)(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:79)(cid:70)(cid:88)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:84)(cid:1)
(cid:66)(cid:79)(cid:69)(cid:1)(cid:81)(cid:83)(cid:80)(cid:68)(cid:70)(cid:84)(cid:84)(cid:70)(cid:84)(cid:1)(cid:74)(cid:79)(cid:87)(cid:80)(cid:77)(cid:87)(cid:70)(cid:84)(cid:1)(cid:83)(cid:74)(cid:84)(cid:76)(cid:13)(cid:1)(cid:84)(cid:86)(cid:68)(cid:73)(cid:1)(cid:66)(cid:84)(cid:1)
(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:85)(cid:74)(cid:78)(cid:70)(cid:84)(cid:68)(cid:66)(cid:77)(cid:70)(cid:84)(cid:13)(cid:1)(cid:78)(cid:70)(cid:70)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)
(cid:85)(cid:73)(cid:70)(cid:1)(cid:83)(cid:70)(cid:82)(cid:86)(cid:74)(cid:83)(cid:70)(cid:69)(cid:1)(cid:85)(cid:70)(cid:68)(cid:73)(cid:79)(cid:74)(cid:68)(cid:66)(cid:77)(cid:1)(cid:84)(cid:81)(cid:70)ciﬁc(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
(cid:66)(cid:79)(cid:69)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:74)(cid:78)(cid:81)(cid:66)(cid:68)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:66)(cid:77)(cid:85)(cid:70)(cid:83)(cid:79)(cid:66)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)
(cid:85)(cid:70)(cid:68)(cid:73)(cid:79)(cid:80)(cid:77)(cid:80)(cid:72)(cid:90)(cid:1)(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:15)

Potential impact

Being at the leading edge of new technology 
in metrology and healthcare, there are 
uncertainties whether new developments 
will provide an economic return.

(cid:52)(cid:86)(cid:81)(cid:81)(cid:77)(cid:90)(cid:1)(cid:68)(cid:73)(cid:66)(cid:74)(cid:79)(cid:1)(cid:78)(cid:66)(cid:79)(cid:66)(cid:72)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)

(cid:36)(cid:86)(cid:84)(cid:85)(cid:80)(cid:78)(cid:70)(cid:83)(cid:1)(cid:69)(cid:70)(cid:77)(cid:74)(cid:87)(cid:70)(cid:83)(cid:74)(cid:70)(cid:84)(cid:1)(cid:78)(cid:66)(cid:90)(cid:1)(cid:67)(cid:70)(cid:1)(cid:85)(cid:73)(cid:83)(cid:70)(cid:66)(cid:85)(cid:70)(cid:79)(cid:70)(cid:69)(cid:1)
(cid:67)(cid:90)(cid:1)(cid:66)(cid:1)(cid:71)(cid:66)(cid:74)(cid:77)(cid:86)(cid:83)(cid:70)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:84)(cid:86)(cid:81)(cid:81)(cid:77)(cid:90)(cid:1)(cid:68)(cid:73)(cid:66)(cid:74)(cid:79)(cid:15)

Potential impact

Inability to meet customer deliveries could 
result in loss of revenue and proﬁt.

Mitigation
(cid:116)(cid:1) Patent and intellectual property 

generation is core to new 
product developments. 

(cid:116)(cid:1) R&D programmes are regularly reviewed 
against milestones and forecast business 
plans and, when necessary, projects 
are cancelled.

(cid:116)(cid:1) New products involve beta testing at 

customers to ensure they will meet the 
needs of the market.

(cid:116)(cid:1) Market developments are 

closely monitored.

Mitigation
(cid:116)(cid:1) Production facilities are maintained with 

ﬁre and ﬂood risk in mind.

(cid:116)(cid:1) Critical production processes are 

replicated at different locations where 
practical (a new surface mount 
electronics assembly line has been 
commissioned at our site in Miskin during 
the year).

(cid:116)(cid:1) Regular vendor reviews are performed for 

critical part suppliers.

(cid:116)(cid:1) Stock policies are reviewed by the Board 

on a regular basis.

(cid:116)(cid:1) Product quality is closely monitored.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

45

(cid:51)(cid:70)(cid:72)(cid:86)(cid:77)(cid:66)(cid:85)(cid:80)(cid:83)(cid:90)(cid:1)(cid:77)(cid:70)(cid:72)(cid:74)(cid:84)(cid:77)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:73)(cid:70)(cid:66)(cid:77)(cid:85)(cid:73)(cid:68)(cid:66)(cid:83)(cid:70)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:84)

(cid:53)(cid:73)(cid:70)(cid:1)(cid:70)(cid:89)(cid:81)(cid:66)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:40)(cid:83)(cid:80)(cid:86)(cid:81)(cid:8)(cid:84)(cid:1)(cid:67)(cid:86)(cid:84)(cid:74)(cid:79)(cid:70)(cid:84)(cid:84)(cid:1)
(cid:74)(cid:79)(cid:85)(cid:80)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:73)(cid:70)(cid:66)(cid:77)(cid:85)(cid:73)(cid:68)(cid:66)(cid:83)(cid:70)(cid:1)(cid:78)(cid:66)(cid:83)(cid:76)(cid:70)(cid:85)(cid:84)(cid:1)(cid:74)(cid:79)(cid:87)(cid:80)(cid:77)(cid:87)(cid:70)(cid:84)(cid:1)(cid:66)(cid:1)
(cid:84)(cid:74)(cid:72)(cid:79)(cid:74)ﬁ(cid:68)(cid:66)(cid:79)(cid:85)(cid:77)(cid:90)(cid:1)(cid:74)(cid:79)(cid:68)(cid:83)(cid:70)(cid:66)(cid:84)(cid:70)(cid:69)(cid:1)(cid:83)(cid:70)(cid:82)(cid:86)(cid:74)(cid:83)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:85)(cid:80)(cid:1)
(cid:80)(cid:67)(cid:85)(cid:66)(cid:74)(cid:79)(cid:1)(cid:83)(cid:70)(cid:72)(cid:86)(cid:77)(cid:66)(cid:85)(cid:80)(cid:83)(cid:90)(cid:1)(cid:66)(cid:81)(cid:81)(cid:83)(cid:80)(cid:87)(cid:66)(cid:77)(cid:1)(cid:81)(cid:83)(cid:74)(cid:80)(cid:83)(cid:1)(cid:85)(cid:80)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)
(cid:84)(cid:66)(cid:77)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:84)(cid:70)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:84)(cid:15)

Potential impact

Regulatory approval can be very expensive 
and time-consuming. This area is also very 
complex and there is a risk that the correct 
approvals are not obtained.

Defined benefit pension schemes

(cid:42)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:83)(cid:70)(cid:85)(cid:86)(cid:83)(cid:79)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:68)(cid:85)(cid:86)(cid:66)(cid:83)(cid:74)(cid:66)(cid:77)(cid:1)
(cid:87)(cid:66)(cid:77)(cid:86)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:69)eﬁn(cid:70)(cid:69)(cid:1)(cid:67)(cid:70)(cid:79)eﬁ(cid:85)(cid:1)
(cid:81)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79) (cid:71)(cid:86)(cid:79)(cid:69)(cid:1)(cid:66)(cid:83)(cid:70)(cid:1)(cid:84)(cid:86)(cid:67)(cid:75)(cid:70)(cid:68)(cid:85)(cid:1)(cid:85)(cid:80)(cid:1)(cid:70)(cid:68)(cid:80)(cid:79)(cid:80)(cid:78)(cid:74)(cid:68)(cid:1)
(cid:66)(cid:79)(cid:69)(cid:1)(cid:84)(cid:80)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:71)(cid:66)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:1)(cid:88)(cid:73)(cid:74)(cid:68)(cid:73)(cid:1)(cid:66)(cid:83)(cid:70)(cid:1)(cid:80)(cid:86)(cid:85)(cid:84)(cid:74)(cid:69)(cid:70)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)
(cid:68)(cid:80)(cid:79)(cid:85)(cid:83)(cid:80)(cid:77)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:40)(cid:83)(cid:80)(cid:86)(cid:81)(cid:15)

Potential impact

Volatility in investment returns and actuarial 
assumptions can signiﬁcantly affect the 
deﬁned beneﬁt pension fund deﬁcit, 
impacting on future funding requirements.

Mitigation
(cid:116)(cid:1) Specialist legal, regulatory and quality 

assurance staff are employed to support 
the healthcare business.

(cid:116)(cid:1) Experience of healthcare regulatory 

matters exists at Board level.

(cid:116)(cid:1) Healthcare operations in UK and France 
have ISO13485 certiﬁcation for their 
quality management systems, with 
Ireland and other subsidiary healthcare 
operations falling under the UK quality 
management system.

Mitigation
(cid:116)(cid:1) The investment strategy is managed 
by the pension fund trustees, who 
operate in line with a statement of 
investment principles which is agreed by 
the Company.

(cid:116)(cid:1) Recovery plans are in place for the 2006 

and 2009 actuarial valuations.

(cid:53)(cid:83)(cid:70)(cid:66)(cid:84)(cid:86)(cid:83)(cid:90)

(cid:39)(cid:77)(cid:86)(cid:68)(cid:85)(cid:86)(cid:66)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:71)(cid:80)(cid:83)(cid:70)(cid:74)(cid:72)(cid:79)(cid:1)(cid:70)(cid:89)(cid:68)(cid:73)(cid:66)(cid:79)(cid:72)(cid:70)(cid:1)(cid:83)(cid:66)(cid:85)(cid:70)(cid:84)(cid:1)(cid:78)(cid:66)(cid:90)(cid:1)
(cid:66)(cid:71)(cid:71)(cid:70)(cid:68)(cid:85)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:83)(cid:70)(cid:84)(cid:86)(cid:77)(cid:85)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:40)(cid:83)(cid:80)(cid:86)(cid:81)(cid:15)

Potential impact

With over 93% of revenue generated outside 
the UK, there is an exposure to major 
currency ﬂuctuations, mainly in respect 
of the US Dollar, Euro and Japanese Yen. 
Such ﬂuctuations can adversely impact 
both the Group’s income statement and 
balance sheet.

Mitigation
(cid:116)(cid:1) The Group enters into forward contracts 

to hedge varying proportions of 
forecast US Dollar, Euro and Japanese 
Yen revenue. 

(cid:116)(cid:1) The Group uses currency borrowings to 
hedge the foreign currency denominated 
assets held in the Group’s balance sheet.

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Corporate social responsibility

This past year we have sought to strengthen our CSR foundations 
and create a solid platform for the future. We have written our ﬁrst 
CSR strategy, and continued to expand our endeavours in our 
areas of control and inﬂuence as part of our CSR activities, showing 
good progress. We have increased our scope of data capture for 
waste and greenhouse gas emissions (“GHG”). A record number of 
apprentices are now in training and we have invested more than 
ever in staff development. We have shown continued growth within 
the business, both in the building space we occupy and in the 
number of employees, however we have still achieved an absolute 
reduction of waste to landﬁll and a reduction of GHG emissions per 
hour produced. We are pleased with the advancements we have 
made over this reporting period and will continue to strive to be 
recognised individually and collectively as leaders and contributors 
in our ﬁeld and community. 

Ben Taylor 
Assistant Chief Executive

(cid:52)(cid:85)(cid:83)(cid:66)(cid:85)(cid:70)(cid:72)(cid:90)

The areas in which we are uniquely placed to ensure this merger of business and 
societal needs are:

In order to continue to evolve our 
approach to CSR in a structured way, 
we have developed a documented 
CSR strategy, approved by our CSR 
committee and Board. We recognise 
that the status quo is changing and 
consequently we are proactively 
addressing issues such as rising energy 
costs, constraints on emissions, ﬁnite 
resources, increasing water scarcity, 
the demand for greater transparency 
and skills shortages. All these areas 
affect our business and customers and 
we are responding with appropriate 
innovative ideas and programmes 
seeking to combine our business and 
societal agendas.

Resources and energy because our 
core products assist our customers 
to improve their efﬁciencies and 
thus reduce their impacts.

Education because we have built 
strong relationships with schools 
and universities, raised our proﬁle 
in the education sector, and 
contributed to government policy to 
ensure we continue to have access 
to skilled individuals.

Community because we are a large 
employer, we are uniquely placed to 
lend support to local charities and 
community groups.

Innovation because this is a core 
business driver at Renishaw 
and will enable us to sustain our 
manufacturing in a world where 
resources are ﬁnite.

(cid:48)(cid:86)(cid:83)(cid:1)(cid:36)(cid:52)(cid:51)(cid:1)(cid:85)(cid:66)(cid:83)(cid:72)(cid:70)(cid:85)(cid:84)

We recognise that to become a company that creates net value in its value chain 
we have to continue to build on our current solid foundations. We have therefore 
developed our ﬁrst set of public targets within a ﬁve-pillar approach to CSR which 
brings transparency to our future activities. These targets will ensure we are able 
to manage our impacts within our value chain and communities effectively. 

(cid:36)(cid:52)(cid:51)(cid:1)(cid:85)(cid:66)(cid:83)(cid:72)(cid:70)(cid:85)(cid:84)

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

47

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(cid:56)(cid:80)(cid:83)(cid:76)(cid:81)(cid:77)(cid:66)(cid:68)(cid:70)

(cid:36)(cid:80)(cid:78)(cid:78)(cid:86)(cid:79)(cid:74)(cid:85)(cid:90)

(cid:46)(cid:66)(cid:83)(cid:76)(cid:70)(cid:85)(cid:81)(cid:77)(cid:66)(cid:68)(cid:70)

(cid:52)(cid:86)(cid:81)(cid:81)(cid:77)(cid:90)(cid:1)(cid:68)(cid:73)(cid:66)(cid:74)(cid:79)

(cid:49)(cid:70)(cid:80)(cid:81)(cid:77)(cid:70)

Increase our 
presence at 
chosen universities, 
colleges and 
schools local to key 
Renishaw locations

Establish local 
charity sponsorship 
presence at key UK 
sites and key global 
sites by the end of 
calendar year 2014

Waste management 
plan by end of 2014 
for all UK sites, and all 
manufacturing sites 
by end of 2015

Investigate business 
case for investment 
in renewables

3% CO2 reduction 
against 2014 levels 
by 2015, normalised 
by turnover

5% reduction of 
waste to landﬁll 
against 2013 levels 
by end of 2014, for 
UK sites, with targets 
for all manufacturing 
sites by end of 2015

Expand health and 
safety controls 
and reporting to all 
locations by end of 
calendar year 2014

Communication of 
CSR activities to 
be increased

Zero fatalities and 
serious accidents

Expand health and 
safety controls to all 
manufacturing sites 
by end of calendar 
year 2016

100% of key suppliers 
to be invited to 
attend a supplier 
engagement day 
in 2015

Ensure suppliers  
are audited 
as required 
through supplier 
questionnaires

Update Group 
Business Code 
in 2015 and audit 
for compliance

100% of suppliers to 
be notiﬁed of updated 
Group Business 
Code and supplier 
questionnaire by end 
of calendar year 2014

Produce CSR 
guidance/case 
studies for marketing 
by end of calendar 
year 2014

Make CSR section 
of corporate website 
more prominent and 
more relevant to 
our business

Establish a baseline 
for orders shipped 
to customer date 
in 2015

Develop a 
management target 
for orders shipped to 
customer date using 
the 2015 year as the 
base year

Track CO2 footprint 
of product logistics to 
collate base year data 
by end of 2015

Develop 
CO2 management 
target for product 
logistics using the 
2015 year as the 
base year

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Corporate social responsibility continued

(cid:49)(cid:70)(cid:80)(cid:81)(cid:77)(cid:70)

(cid:37)(cid:74)(cid:87)(cid:70)(cid:83)(cid:84)(cid:74)(cid:85)(cid:90)
Renishaw is an equal opportunities 
employer, operating a strict non-
discrimination policy. We offer an 
environment that actively promotes 
innovation and progress within which 
individual talents can ﬂourish.

Renishaw is also a global business 
with more than 70 locations in over 32 
countries, and therefore diversity is an 
integral part of how we do business. 
We acknowledge the beneﬁts it can 
bring and our senior management group 
comprises 26 nationalities.

A common challenge in the engineering 
sector is to achieve a more even 
balance between the genders and as 
more women choose to study science 
and technical subjects it is hoped 
that the number of female candidates 
for vacancies will increase. In the 
last two years we have employed 68 
young people for our apprenticeship 
programme and a further 125 for 
our graduate programme, through 
co-operation with numerous education 
establishments. Of these, 171 are 

male and 22 are female. The total 
number of apprentices in training, 
as at 30th June 2014, represents 3% 
of our total workforce.

Proper consideration is given to 
applications for employment from 
disabled people who are employed, 
where suitable, for appropriate 
vacancies. Opportunities are given to 
employees who become disabled to 
continue in their employment or to be 
trained for other positions.

On 30th June 2014, we employed 
3,492 people across the Group, an 
increase of 257 since last year. Of these, 
2,699 (77%) are male and 793 (23%) 
are female. There are 8 directors on the 
Board, consisting of seven males and 
one female. The senior management 
group is made up of 48 people, of 
which 45 (94%) are male and 3 (6%) 
are female. Renishaw regards its 
senior management group to be the 
Executive Board, the heads of each 
product division, sales territories and 
manufacturing organisation who report 
directly into the Executive Board and the 
directors of the subsidiary undertakings 
of Renishaw.

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We work hard to promote an excellent 
working environment that encourages 
our employees to develop their careers 
at Renishaw. Our UK staff turnover rate 
at 5% is still signiﬁcantly lower than the 
UK manufacturing industry national 
average of 8%. 

To ensure we reward our employees’ 
loyalty and hard work we regularly hold 
pay reviews and benchmark our salaries. 
We have a group performance-based 
bonus programme for all qualifying 
staff members. 

We also offer on-site ﬁtness suites, 
appropriate ﬂexible working (to 
encourage a good work-life balance), 
subsidised restaurants at our key UK 
locations and a crèche at our facility in 
Pune, India.

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As a group that operates in a large 
number of different territories across 
the globe, we recognise the need for 
good communication between sites, 
but also between management and 
their teams. To facilitate this we hold 
regular communications meetings 
where a Board member is present. 
These provide information about 

Directors and senior managers from 
Renishaw’s product lines, global 
subsidiaries, group corporate services 
and manufacturing services division.

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49

developments across the Group 
and give an opportunity for an open 
discussion with a member of the Board. 
These are supported by presentations 
of the annual and half yearly ﬁnancial 
results by the Assistant Chief Executive 
at our larger locations, supplemented 
by video-conference presentations for 
smaller remote sites. 

We continue to encourage our staff 
to communicate any suggestions and 
ideas they may have, either to their 
direct management teams or the Board 
directly. We also provide a Suggestion 
Scheme to which staff can submit 
ideas. We value these suggestions 
and all are assessed for suitability for 
adoption. Awards are given for the 
best ideas received. There is also an 
inventors’ award scheme for individuals 
who are named as inventors on patent 
applications which are granted. 

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We value our highly skilled workforce 
and recognise that maintaining this is 
essential to the future of our business; 
as such we place a large emphasis 
on ensuring the Company’s approved 
training programme continues. 
Throughout this ﬁnancial year we have 

invested £300,000 in our apprenticeship 
scheme, £100,000 on further education 
and £270,000 on our employee 
training programme. 

We have long held the view that by 
investing in our future workforce we are 
able to acquire the necessary talent 
to grow the business and mitigate the 
impacts of a general skills shortage, as 
evidenced by the fact that we started 
our apprenticeship and sponsored 
student schemes in 1979 and 1984 
respectively. This summer, some 
105 (2013 equivalent: 94) students 
entered Renishaw for paid placements 
– 60 summer placements, 40 one-year 
industrial placements and  
5 pre-university placements. There are 
105 craft and technical apprentices 
currently in training (2013 equivalent: 
82) and 32 new starters conﬁrmed for 
September 2014. A further 68 new 
graduates also started with Renishaw 
this summer (2013 equivalent: 55).

The quality of our apprenticeship 
and graduate programmes is widely 
recognised. In June 2014, at the 
Gloucestershire Apprenticeship 
Awards, Renishaw was given the 
award for ‘Outstanding Contribution 
to Apprenticeships in Gloucestershire’, 

whilst our ﬁrst-year apprentice 
Eva Lily Fielding was named 
“Outstanding Apprentice of the Year” 
in the Engineering & Manufacturing 
category, and was also honoured as 
the ‘Gloucestershire Apprentice of 
the Year’ across all categories. At the 
Gloucestershire Women in Business 
Awards held in March, our fourth-year 
apprentice Roxanne Pollard was named 
as “Apprentice of the Year”.

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Renishaw is a supporter of the 
Universal Declaration of Human 
Rights and the core conventions of 
the International Labour Organization. 
Through our Group Business Code 
we state the minimum standards of 
operation expected of our organisations, 
subsidiaries and employees. This code 
sets out our belief that all employees 
have the right to non-discriminatory 
treatment and equal opportunities, 
to work in a safe and secure working 
environment with a fair wage. We also 
reject the use of compulsory, forced 
and child labour. We seek suppliers 
and business partners who work to the 
same high standards as us. 

Award-winning apprentice

At the Gloucestershire Apprenticeship 
Awards, our ﬁrst-year apprentice Eva 
Lily Fielding was named Outstanding 
Apprentice of the Year in the Engineering 
& Manufacturing category, and overall 
Gloucestershire Apprentice of the Year.

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Strategic report

Corporate social responsibility continued

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As one of the largest employers in the 
west of England, and with an increasing 
number of sites in the UK and around the 
world, we recognise the positive 
contribution that we can make to our 
local communities through our varied 
interactions with local residents, 
businesses, schools and not-for-proﬁt 
organisations. We continue to 
communicate a positive story about the 
role played by science, engineering and 
manufacturing to enhance the lives of the 
general populace and the attractive 
nature of a career within these sectors. 
Renishaw sees this as vital to overcome 
negative perceptions about career 
options in these areas and to ensure a 
strong pipeline of future talent, not just for 
our own needs, but also for our wider 
supply chain and customer base. 

During the past year we have hosted 
tour groups and given talks to a range 
of organisations including primary and 
secondary schools, universities and 
colleges, business clubs and societies. 
With an increasing proﬁle we are also 
regularly asked to give interviews by 
national and local media on a range 
of topics relating to manufacturing, 
3D printing and general business issues. 

We continue actively to support 
the business community regionally, 
nationally and internationally, through 
membership of trade associations 
such as Germany’s VDW and the 
UK’s Manufacturing Technologies 
Association, as well as local chambers 
of trade and business networking 
groups. During the year we also became 
a member of the Confederation of 
British Industry (“CBI”), which is the UK’s 
leading business lobbying organisation. 
We impart our knowledge and business 

expertise in areas as diverse as AM, 
IT systems, exporting and human 
resource management, through 
participation in business conferences 
and roundtable discussions, and also 
make a signiﬁcant commitment to the 
sponsorship of award programmes. 

Senior managers, including Group 
Engineering Director, Geoff McFarland, 
Assistant Chief Executive, Ben Taylor, 
and Head of Communications, 
Chris Pockett, are also regular speakers 
at conferences and business/community 
events. In the past year this has included 
keynote presentations on sustainable 
manufacturing, innovation, business 
growth and the Renishaw story. 

During the past year we have become 
a major sponsor of the Manufacturing 
Excellence (“MX”) Awards operated 
by the UK’s Institution of Mechanical 
Engineers (“IMechE”), and continue to 
support the sister MX programme in 
Germany. For both schemes, senior 
managers are members of the advisory 
board. In the past year, we have also 
sponsored and helped judge a range of 
regional business award programmes, 
for example, Ben Taylor is a judge 
for the West of England Business 
Awards. Recognising the importance 
of apprenticeships, we supported both 
the regional Gloucestershire and Bristol 
Apprentice of the Year awards. 

To further our aim of establishing 
awareness of Renishaw as a signiﬁcant 
regional employer, we continue to 
sponsor a wide range of festivals and 
organisations in the west of England 
and South Wales. A key part of our 
sponsorship is also a desire to achieve 
beneﬁts for our staff, which will in turn 
increase their engagement with partner 
organisations. A good example is a new 
partnership with the Bristol Music Trust, 

German handball team sponsored

Renishaw GmbH sponsors the handball 
team HBW Balingen-Weilstetten, which 
this season played in the German  
Handball-Bundesliga.

Gloucester Rugby young player award

Norma Tang, Company Secretary, presents 
the Renishaw-sponsored Young Player of the 
Season award to Elliott Stooke.

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51

Trophy for Art Couture Painswick

Renishaw used its AM process to create 
the main trophy which was presented 
to the winner by Chris Pockett, Head 
of Communications.

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which operates the well-known Colston 
Hall; a major venue for music and 
comedy entertainment. In spring 2014 
we became a sponsor of The Lantern, 
a 250-seater space within the Colston 
Hall which hosts a wide range of music 
in a quirky environment, and as part of 
the deal, giving all staff the opportunity 
to apply for free membership of the 
Colston Hall. 

Another new sponsorship saw Renishaw 
support Art Couture Painswick, an 
increasingly popular festival for wearable 
art, at which we presented the Renishaw 
Innovation Trophy for the best overall 
entry at the event. The trophy was a 
unique collaboration between Renishaw 
and Lionel T. Dean, a leading designer 
for the digital manufacturing process, 
who created a Viennese face mask 
which we then made in titanium using 
our AM machine. 

We are continuing to strengthen our 
relationships with local and professional 
sports clubs in areas where we have 
signiﬁcant UK operations, including 
Gloucester Rugby which plays in 
the rugby English Premiership and 
Swansea City football club based in 
South Wales, which plays in the football 
English Premier League. At the former, 
we sponsor Ben Morgan, an England 
international player, and the Young 
Player of the Year award, voted for 
by our Gloucestershire-based staff. 
Viewers of BBC’s Match of the Day 
programme will also regularly see our 
advertising hoardings at Swansea City 
home matches.

During the year we also sponsored the 
German Handball-Bundesliga team 
HBW Balingen-Weilstetten, which is 
based in an area where many of our 
major customers are also located.

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The Renishaw Charities Committee 
(“RCC”) was formed in the 1980s to 
distribute funds to support charitable 
and voluntary organisations and to 
support the individual charitable efforts 
of all UK staff through a match-funding 
scheme. The RCC is made up of staff 
representatives from the Company’s 
main Gloucestershire sites and has a 
particular focus to assist organisations 
that help enrich the lives of children and 
adults, from toddler groups and sports 
clubs, through to organisations that 
support the disabled and the bereaved. 
A separate fund is also administered by 
the RCC, which donates monies to aid 
the victims of global disasters.

During the year, the RCC 
(www.renishaw.com/charity) made 
donations to over 180 individual 
organisations totalling over £97,000. 
Beneﬁciaries were diverse in nature 
including music societies, disability 
support groups, primary and secondary 
schools, animal shelters, church 
restoration funds, counselling and 

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Strategic report

Corporate social responsibility continued

carers support groups, scout and 
brownie groups, medical research 
organisations, community centres, air 
ambulance groups, sports clubs, skate 
parks, senior citizen groups and hospice 
care organisations.

The Company and the RCC 
recognise that large numbers of 
Renishaw employees assist charitable 
organisations and therefore encourages 
such activities through match-funding 
programmes, both for individual 
and collective fundraising efforts. 
Employee communications from the 
Company and the RCC’s intranet 
pages also include details of charities 
seeking support for fundraising 
activities or in need of volunteers/
trustees, and promotional posters for 
fundraising events are distributed to 
company noticeboards.

The RCC fully matches funds raised by 
staff for UK national initiatives such as 
Movember, Comic Relief and Wear it 
Pink. During the year, many employees 
undertook fundraising for Children in 
Need, raising just over £3,000 which 
was matched by the RCC. 

During the year, signiﬁcant donations 
of £2,000 or greater were made by 
the RCC to seven organisations. 
This included a £10,000 donation to 
the Disaster’s Emergency Committee 

(“DEC”) which co-ordinated UK 
fundraising for victims of the typhoon 
in the Philippines which occurred on 
8th November 2013, affecting over 
14 million people. A £2,000 donation 
was also made towards the creation of 
a new Youth Centre for Dursley, near to 
the UK headquarters, within the town’s 
Tabernacle Church.

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In order to attract the future engineering 
talent pool, we need to reach young 
people, their parents and teachers 
with messages about 21st century 
engineering and the career opportunities 
at all levels. We are starting to see 
more people applying for graduate and 
apprenticeship positions (applications for 
both have quadrupled in the last three 
years) but we cannot be complacent. 
The sector employs 5.4 million people 
across 542,440 engineering companies 
in the UK, and between 2010 and 2020 
these companies are projected to have 
2.74 million job openings (Engineering 
UK report 2013). We work hard to 
ensure that we have engagement in 
schools in our major employment areas, 
as well as building and strengthening 
relationships with universities, raising our 
proﬁle locally and nationally, and also 
lobbying government so that our voice is 
heard at the highest levels.

Renishaw apprentice meets HRH The Duke 
of York

Our ﬁrst-year apprentice, Matthew Hunter, 
discusses his award-winning phone charging 
system for bicycles with HRH The Duke 
of York.

Award-winning primary schools visit Renishaw

Graduate induction programme

Winning teams from local primary schools visited Renishaw to 
programme the robot ‘Nao’.

Graduates and apprentices enjoying team-building exercises in the 
Forest of Dean during their induction programme.

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53

about AM. During the event, one of our 
ﬁrst-year apprentices, Matthew Hunter, 
won the Young Engineers’ Duke of York 
award for the “The Most Creative Use 
of Technology”, and met the Duke to 
explain his innovative phone charging 
system for bicycles.

Our work to build relationships with 
schools in South Wales continued, 
with another two successful education 
days at our Miskin site, where over 
500 students from local schools and 
universities had guided tours of our 
machine shop, electronics assembly 
line and the assembly area for our AM 
machines. We also supported two 
schools with their project to compete 
for a prize at an Engineering Education 
South Wales event, and were delighted 
when one of our supported schools, 
Monmouth School, won an award 
for the second year running. We also 
sponsored several schools taking 
part in the F1 in Schools competition, 
and one school also had help from 
a Renishaw engineer to redesign 
their car’s nose cone, which was 
subsequently manufactured in our 
rapid manufacturing facility.

Big Bang Fair 2014

A record number of students visited 
Renishaw’s stand at the NEC in April 2014. 

During the year we were delighted 
to be named Gloucestershire STEM 
Company of the Year by STEMNET, 
a UK educational charity that seeks 
to encourage participation at school 
and colleges in the areas of Science, 
Technology, Engineering and 
Mathematics (“STEM”). The award 
recognised our STEM work and 
initiatives with all the schools in the 
county. Our ongoing involvement with 
the Primary School Challenge organised 
by GFirst, the Gloucestershire Local 
Enterprise Partnership, was recognised 
by Julie Collins, our Education Liaison 
Executive, being named Gloucestershire 
Skills Ambassador of the Year. 
This programme continues to be very 
successful in introducing 9 to 11 year 
old children to computer programming 
and Renishaw engaged with teams 
in 6 primary schools, supported by 
graduates or apprentices who mentored 
the children and positively promoted 
engineering as a career. The best team 
from each school won the opportunity 
to visit Renishaw and programme a 
humanoid robot called Nao.

We continue to extend initiatives such 
as our partnership with Greenpower, 
a national organisation that promotes 
green energy racing competitions, 
where again we sponsored the Western 
regional heat and had a small stand 
at the national ﬁnals at the Goodwood 
motor circuit in the south of England. 
Our “Technology Teardowns”, where 
pupils take apart mobile phones, printers 
and other consumer devices to learn 
about electronics, have also become 
very popular. Pupil feedback is excellent, 
with most commenting it helped them 
understand what engineering is about 
and what an engineer does. During the 
year, we were again a key sponsor and 
contributor to the Stroud Festival of 
Manufacturing and Engineering, a week-
long festival initiated by Neil Carmichael, 
the Member of Parliament for Stroud, 
Gloucestershire, to raise the proﬁle of 
engineering and career opportunities. 

Our focus on schools engagement 
means that during the year we trained 
all our new graduate entrants and 
second-year apprentices to be STEM 
ambassadors. This enables Renishaw 
to involve more schools in our outreach 
programmes, with our young engineers 
giving talks, helping out at STEM clubs 
and attending career fairs. We are then 
able to give the message directly to 
students about what it is like being an 
engineer, which research has shown is 
the most important hurdle to overcome 
when inﬂuencing a young person’s 
career choice. 

A major initiative this year was a pilot 
programme that we have worked on 
with the UK organisation DATA (Design 
and Technology Association). Now that 
Design and Technology (“D&T”) has 
been retained as a compulsory subject 
in UK schools up to the age of 14, 
and the UK national curriculum has 
been updated to be a better ﬁt for the 
needs of industry in the 21st century, 
skills gaps have been identiﬁed, as 
teachers have not been trained in areas 
such as robotics and programming. 
As part of the pilot, we have worked 
with D&T teachers at Marling School, 
Stroud, on a project to teach them 
programming in C++, working with a 
microprocessor and designing a buggy. 
They were then supported to teach 
this to their students over a 10-week 
period. Materials developed, including a 
teachers’ pack, lesson plans and videos 
will be available on DATA’s website from 
September 2014 allowing all schools in 
the UK to have access to, and beneﬁt 
from, this project. 

We continue to raise awareness of 
Renishaw as a major UK employer of 
young people both locally and nationally. 
We again attended the national Big Bang 
Fair held at the NEC in Birmingham, 
where over 2,500 young people, plus 
teachers and parents, visited our 
stand to play a game that incorporated 
our measurement and computer 
technology, and also to be educated 

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Strategic report

Corporate social responsibility continued 

We are continuing to work with 
universities to build relationships. 
During the year we sponsored Formula 
Student teams at several universities, 
including the GreenTeam based at the 
University of Stuttgart, Germany, plus 
engineering societies, and we also 
attended a record number of career 
fairs. A new initiative this year was a 
collaboration with the University of 
Loughborough to design four projects 
that 16 second-year students worked 
on over a 3-month period. This very 
successful initiative raised our proﬁle 
enormously at the university and will be 
repeated in the next academic year. 

We continue to work with industry 
organisations and engineering peers to 
advise government on national policy. 
During the year we were invited to join 
the Royal Academy of Engineering’s 
Leadership and Diversity Board, which 
has been set up to help remove barriers 
and encourage more women and 
other under-represented groups into 
engineering. We also had discussions 
with government ministers responsible 
for education, to lobby for the inclusion 
of D&T to be a compulsory subject in the 
new UK EBacc qualiﬁcation. We know 
that studying D&T has a great inﬂuence 
on encouraging young people to choose 
engineering as a career. 

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Improving the operational efﬁciencies of 
the Renishaw locations across the world 
contributes to the sustainable growth of 
the business. We recognise the need to 
lower the impacts from our operations 
to support this sustainable growth, and 
at this stage we focus on carbon and 
waste as two areas of signiﬁcant impact. 

We continue to have growth in the 
business and thereby have increased 
activities; this is reﬂected in our overall 
(“GHG”) increase. To assist in the 
mitigation of this rise we have continued 
to invest in new technologies that help to 
reduce our energy consumption. In the 
past year, we have invested around 
£250,000 in equipment which will allow 
us to reduce our GHG emissions by an 
estimated 1,900 (4.3% of our annual 
total tonnes carbon dioxide equivalent 
(“tCO2e”) per annum) over the next 
12 months. In addition to using half 
hourly meters which assist us in tracking 
energy consumed, we have invested 
in some portable energy monitoring 
equipment which allows us to create 
energy proﬁles of distinct areas of our 
sites and ascertain where we can 
further increase our energy reduction 
programmes. We are also actively 
investigating more sustainable energy 
sources where it is practical and  
cost-effective to do so. 

As we continue to invest in new sites 
and the expansion and renovation of 
existing properties, we have included 
several initiatives to contribute signiﬁcant 
energy savings in our new building and 
renovation works across the Group; for 
example, we have been able to design 
out over 500,000 kWhs of annual energy 
usage in our new building at New Mills.

Renishaw continues to participate in 
the Carbon Reduction Commitment 
(“CRC”) Energy Efﬁciency Scheme and 
the Carbon Disclosure Project (“CDP”). 
We use the CDP as a benchmarking 
tool and are working extensively to 
ensure our efforts in GHG emission 
management are fully disclosed and 
are as transparent as is expected 
of us by our employees, customers 
and investors. 

We continue to maintain our Carbon 
Trust Standard for our UK operations 
and have also been awarded the Carbon 
Trust Standard for waste (UK operations 
only) within this reporting period. 
Our Carbon Trust Standard currently 
covers over 62% of our GHG emissions. 
This year we have further bolstered this 
standard and expanded the certiﬁcation 
to cover business travel and logistics, as 
well as operational energy. 

We recognise that we are legally 
obliged to report on our Scope 1 
and 2 emissions (as deﬁned by the 
Greenhouse Gas Protocol), however, 
through analysis it is evident that 
our Scope 3 emissions amount to a 
signiﬁcant proportion of our carbon 
footprint. As such we will continue to 
disclose our Scope 1, 2 and signiﬁcant 
Scope 3 emissions and will continue 
to put efforts into improving data 
quality, scope of data and working on 
expanding our Scope 3 data capture to 
enable a more complete picture of our 
GHG emissions. 

In this reporting period our total GHG 
emissions for our Scope 1 and 2 
emissions (statutory disclosure) were 
18,209.37 tCO2e. Our signiﬁcant Scope 
3 emissions (voluntary disclosure) were 
25,761.35 tCO2e. 

To calculate our GHG emissions we 
have used the GHG Protocol Corporate 
Accounting and Reporting Standard 
(revised addition), data gathered for our 
CRC submission and the UK 
government’s GHG reporting guidance 
as the basis of our methodology and the 
source of GHG emissions factors. 

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

55

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:40)(cid:41)(cid:40)(cid:1)(cid:70)(cid:78)(cid:74)(cid:84)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)(cid:9)(cid:85)(cid:36)(cid:48)(cid:19)(cid:70)(cid:10)(cid:1)

(cid:19)(cid:17)(cid:18)(cid:17)

(cid:19)(cid:17)(cid:18)(cid:18)

(cid:19)(cid:17)(cid:18)(cid:19)

(cid:19)(cid:17)(cid:18)(cid:20)(cid:18)

(cid:19)(cid:17)(cid:18)(cid:21)(cid:20)(cid:1)

(cid:52)(cid:68)(cid:80)(cid:81)(cid:70)(cid:1)(cid:18)

Gas consumption

Owned transport

Generator diesel

Heating oil

Fugitive emissions

Out of scope (bio fuel blend) 

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:52)(cid:68)(cid:80)(cid:81)(cid:70)(cid:1)(cid:18)(cid:1)(cid:9)(cid:85)(cid:36)(cid:48)(cid:19)(cid:70)(cid:10)

(cid:52)(cid:68)(cid:80)(cid:81)(cid:70)(cid:1)(cid:19)

Purchased electricity

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:52)(cid:68)(cid:80)(cid:81)(cid:70)(cid:1)(cid:19)(cid:1)(cid:9)(cid:85)(cid:36)(cid:48)(cid:19)(cid:70)(cid:10)

685.00

1,842.40

65.60

38.20

0.00

0.00

652.00

1,617.00

40.00

77.00

0.00

0.00

1,456.00

1,334.40

1,479.53

1,521.53

85.00

75.00

0.00

33.96

31.91

56.74

88.72

39.74

1,281.42

2,229.84

22.76

13.18

382.96

60.34

(cid:19)(cid:13)(cid:23)(cid:20)(cid:18)(cid:15)(cid:19)(cid:17)

(cid:19)(cid:13)(cid:20)(cid:25)(cid:23)(cid:15)(cid:17)(cid:17)

(cid:19)(cid:13)(cid:26)(cid:22)(cid:17)(cid:15)(cid:21)(cid:17)

(cid:20)(cid:13)(cid:18)(cid:24)(cid:25)(cid:15)(cid:21)(cid:21)

(cid:20)(cid:13)(cid:26)(cid:20)(cid:17)(cid:15)(cid:18)(cid:23)

10,525.40 

14,347.00 

12,008.17 

 13,629.09 

14,279.20 

(cid:1)(cid:18)(cid:17)(cid:13)(cid:22)(cid:19)(cid:22)(cid:15)(cid:21)(cid:17)(cid:1)

(cid:18)(cid:21)(cid:13)(cid:20)(cid:21)(cid:24)(cid:15)(cid:17)(cid:17)(cid:1)

(cid:1)(cid:18)(cid:19)(cid:13)(cid:17)(cid:17)(cid:25)(cid:15)(cid:18)(cid:24)(cid:1)

(cid:18)(cid:20)(cid:13)(cid:23)(cid:19)(cid:26)(cid:15)(cid:17)(cid:26)(cid:1)

(cid:18)(cid:21)(cid:13)(cid:19)(cid:24)(cid:26)(cid:15)(cid:19)(cid:17)(cid:1)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:84)(cid:85)(cid:66)(cid:85)(cid:86)(cid:85)(cid:80)(cid:83)(cid:90)(cid:1)(cid:40)(cid:41)(cid:40)(cid:1)(cid:70)(cid:78)(cid:74)(cid:84)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)(cid:19)(cid:1)(cid:9)(cid:85)(cid:36)(cid:48)(cid:19)(cid:70)(cid:10)
(cid:47)(cid:80)(cid:83)(cid:78)(cid:66)(cid:77)(cid:74)(cid:84)(cid:70)(cid:69)(cid:1)(cid:84)(cid:85)(cid:66)(cid:85)(cid:86)(cid:85)(cid:80)(cid:83)(cid:90)(cid:1)(cid:40)(cid:41)(cid:40)(cid:1)(cid:70)(cid:78)(cid:74)(cid:84)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)(cid:19)(cid:1)(cid:1)
(cid:67)(cid:90)(cid:1)(cid:83)(cid:70)(cid:87)(cid:70)(cid:79)(cid:86)(cid:70)(cid:1)(cid:9)(cid:85)(cid:36)(cid:48)(cid:19)(cid:70)(cid:16)(cid:98)(cid:78)(cid:10)(cid:1)

(cid:1)(cid:18)(cid:20)(cid:13)(cid:18)(cid:22)(cid:23)(cid:15)(cid:23)(cid:17)(cid:1)

(cid:1)(cid:18)(cid:23)(cid:13)(cid:24)(cid:20)(cid:20)(cid:15)(cid:17)(cid:17)(cid:1)

(cid:1)(cid:18)(cid:21)(cid:13)(cid:26)(cid:22)(cid:25)(cid:15)(cid:22)(cid:23)(cid:1)

(cid:18)(cid:23)(cid:13)(cid:25)(cid:17)(cid:24)(cid:15)(cid:22)(cid:20)(cid:1)

(cid:18)(cid:25)(cid:13)(cid:19)(cid:17)(cid:26)(cid:15)(cid:20)(cid:24)(cid:1)

(cid:24)(cid:19)(cid:15)(cid:21)(cid:21)(cid:25)(cid:19)

(cid:22)(cid:24)(cid:15)(cid:26)(cid:21)(cid:26)(cid:25)

(cid:21)(cid:22)(cid:15)(cid:17)(cid:23)(cid:26)(cid:22)

(cid:21)(cid:25)(cid:15)(cid:21)(cid:23)(cid:21)(cid:23)

(cid:22)(cid:18)(cid:15)(cid:18)(cid:23)(cid:21)(cid:20)

(cid:52)(cid:68)(cid:80)(cid:81)(cid:70)(cid:1)(cid:20)

Business travel

Product distribution

Raw material purchase

Post and communications

Transmissions and distribution

WTT total 

Out of scope (biofuel blend) 
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:84)(cid:74)(cid:72)(cid:79)(cid:74)ﬁ(cid:68)(cid:66)(cid:79)(cid:85)(cid:1)(cid:52)(cid:68)(cid:80)(cid:81)(cid:70)(cid:1)(cid:20)(cid:1)(cid:9)(cid:85)(cid:36)(cid:48)(cid:19)(cid:70)(cid:10)
(cid:47)(cid:80)(cid:83)(cid:78)(cid:66)(cid:77)(cid:74)(cid:84)(cid:70)(cid:69)(cid:1)(cid:85)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:40)(cid:41)(cid:40)(cid:1)(cid:70)(cid:78)(cid:74)(cid:84)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)(cid:21)(cid:1)(cid:1)
(cid:67)(cid:90)(cid:1)(cid:83)(cid:70)(cid:87)(cid:70)(cid:79)(cid:86)(cid:70)(cid:1)(cid:9)(cid:85)(cid:36)(cid:48)(cid:19)(cid:70)(cid:16)(cid:98)(cid:78)(cid:10)(cid:1)

 1,264.70 

 2,144.00 

 2,539.80 

 7,392.76 

 8,298.57 

1,919.80 

3,908.00 

4,058.00 

3,545.49 

5,382.00 

3,533.90 

7,465.00 

4,622.00 

4,020.35 

3,771.30 

276.30 

353.00 

398.00 

500.13 

504.77 

– 

– 

– 

– 

– 

– 

1,299.82 

4,049.64 

1,745.09 

 2,160.45 

4,912.26 

5,644.26 

8.30 

8.81 

49.97 

(cid:23)(cid:13)(cid:26)(cid:26)(cid:21)(cid:15)(cid:24)(cid:17)(cid:1)

(cid:18)(cid:20)(cid:13)(cid:25)(cid:24)(cid:17)(cid:15)(cid:17)(cid:17)(cid:1)

(cid:18)(cid:23)(cid:13)(cid:26)(cid:23)(cid:24)(cid:15)(cid:19)(cid:22)(cid:1)

(cid:19)(cid:19)(cid:13)(cid:18)(cid:18)(cid:23)(cid:15)(cid:17)(cid:25)(cid:1)

(cid:19)(cid:22)(cid:13)(cid:24)(cid:23)(cid:18)(cid:15)(cid:20)(cid:22)(cid:1)

(cid:18)(cid:18)(cid:17)(cid:15)(cid:26)(cid:24)(cid:1)

(cid:18)(cid:17)(cid:22)(cid:15)(cid:26)(cid:25)(cid:1)

(cid:26)(cid:23)(cid:15)(cid:18)(cid:26)(cid:1)

(cid:18)(cid:18)(cid:19)(cid:15)(cid:19)(cid:21)(cid:1)

(cid:18)(cid:18)(cid:25)(cid:15)(cid:17)(cid:24)(cid:1)

1  2013 ﬁgures have been restated due to improvements in our methodology, updated GHG conversion factors and changing the reporting period to be in line with 

the ﬁnancial year. 

2 Statutory emissions are Scopes 1 and 2 as required by the Companies Act 2006 (Strategic Report and Directors’ Report) Regulations 2013. 

3  To facilitate the timely capture of information, this disclosure uses internally reported data from July to May and the June data is given as an average of the 

previous three months. This will be restated next year if a signiﬁcant difference is seen. 

4 Total GHG emissions include Scopes 1 and 2 (statutory) and Scope 3 (voluntary) emissions.

We recognise the impact from employees commuting to our sites and whilst we have not yet quantiﬁed this, we actively promote 
a car share scheme through an intranet site which can be used to ﬁnd car share partners. We provide excellent facilities for 
employees who chose to commute by bike, through lockers, showers and covered bike storage areas. 

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Strategic report

Corporate social responsibility continued

deadlines for healthcare products. 
We continue to monitor substances 
against those identiﬁed as “substances 
of very high concern” (“SVHC”) 
under the Registration, Evaluation, 
Authorisation and Restriction of 
Chemicals (“REACH”) Directive, and to 
date have not identiﬁed that anything we 
use is on the SVHC lists. However, we 
continue to monitor this. We recognise 
that whilst we do not fall within the 
remit of the Dodd-Frank Wall Street 
Reform and Consumer Protection Act, 
compliance with the conﬂict minerals 
assessment and disclosure aspects of 
such legislation is important to a number 
of our customers. We also recognise 
that it is our responsibility to ensure 
that our supply chain does not support 
illegal or unfair practices. Therefore, 
we are actively investigating our supply 
chain to enable us to eliminate conﬂict 
minerals from it and are working with a 
number of key suppliers on this project. 
We also monitor for any issues we would 
consider to be against the spirit of our 
Group Business Code and work with 
suppliers where issues are identiﬁed. 

(cid:56)(cid:66)(cid:84)(cid:85)(cid:70)(cid:1)(cid:78)(cid:66)(cid:79)(cid:66)(cid:72)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)

Renishaw continues to expand its waste 
controls and now collates waste data for 
analysis from all the sites covered by the 
Carbon Trust Standard for waste and a 
number of other sites across the world. 
We continue to encourage employees 
to prevent waste going to landﬁll. 
To support this, within this reporting 
period we have streamlined our waste 
services across the UK and are working 
with our waste partner to increase 
recycling further. Over the past three 
years we have seen a 50% drop in the 
amounts sent to landﬁll. This means we 
are now reusing or recovering around 
88% (2013: 85%) of all the waste from 
our UK, Ireland and other key sites.
We continue to act responsibly on 
behalf of our customers and distribute 
our technical and sales documentation 
electronically whenever possible. 
We also have user guides for some 
of our product groups only available 
online. Our commercial documentation, 
payslips in the UK and invoices are all 
managed through paperless systems. 
Whilst these efforts are only a small 
part of what we do, they represent our 
attitude to ensure that we do all that we 
can to be a responsible organisation. 
Internal communications, wherever 
possible, are only made via emails or 
through the company intranet. 
We continue to make progress on 
our product range to prepare it to be 
compliant for the Restriction of the use 
of Hazardous Substances Regulations 
(“RoHS”) extended scope deadline in 
2017, whilst achieving several earlier 

Waste recovered or 
recycled (tonnes)
Waste sent to landﬁll 
(tonnes)
Percentage of waste sent 
to landﬁll

2011

2012

2013

(cid:19)(cid:17)(cid:18)(cid:21)

947.68

885.57

1,210.97

(cid:18)(cid:13)(cid:20)(cid:19)(cid:26)(cid:15)(cid:18)(cid:19)

365.03

252.41

213.41

(cid:18)(cid:25)(cid:19)(cid:15)(cid:20)(cid:26)

28%

22%

15%

(cid:18)(cid:19)(cid:6)

Waste management

Briquetting system installed at Renishaw’s 
Miskin site to reclaim compacted 
aluminium swarf.

Carbon Trust Standard – Waste

Renishaw was one of the ﬁrst ﬁve businesses 
in the world to achieve this new standard 
launched in November 2013. It is the world’s 
ﬁrst international standard for organisational 
waste reduction. It is an independent 
standard that certiﬁes organisations which 
are measuring, managing and reducing their 
waste output, year-on-year.

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Renishaw has a well established 
corporate health and safety 
management system that is in line 
with the ISO18001 requirements. 
We recognise that any injury may 
develop into something more 
serious if not cared for correctly. 
As our employees are essential to our 
business, we record all injuries from 
the smallest of paper cuts to the most 
serious of incidents, to enable us to 
manage treatment and investigate all 
incidents effectively. 
The total number of accidents for the 
period was 151 (2013: 161) against a year 
end headcount of 3,492 (2013: 3,235). 
This equates to an accident ratio of 
0.043 accidents per person and is 
8.1% down on the same period the 
year before, despite an 8% increase in 
stafﬁng levels. Training continues to take 
place in order to continue to reduce the 
accident rate further.

(cid:51)(cid:70)(cid:81)(cid:80)(cid:83)(cid:85)(cid:66)(cid:67)(cid:77)(cid:70)(cid:1)(cid:66)(cid:68)(cid:68)(cid:74)(cid:69)(cid:70)(cid:79)(cid:85)(cid:84)
There were two reportable accidents 
under the UK RIDDOR reporting 
requirements: one slip and one crush 
resulting in a total lost time of 271 hours 
or 36.1 days.

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Renishaw has had no work-related ill 
health or diseases reported.
Health monitoring in the form of lung 
function testing, hearing testing and eye 
testing, where appropriate for a job role, 
has been established for several years 
and is ongoing.
Health support for staff is offered in the 
form of subsidised health monitoring 
(blood pressure, diabetes, cholesterol 
and BMI). 

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A total of 68 (2013: 57) near misses were 
recorded for the period. This is a 19.2% 
increase on the numbers reported in 
the last period, driven as a result of 
stronger emphasis on the importance 
of reporting of what might seem even 
trivial incidents. No signiﬁcant repeating 
common causes have been established. 

(cid:51)(cid:74)(cid:84)(cid:76)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:84)(cid:84)(cid:78)(cid:70)(cid:79)(cid:85)
Over the period an automated risk 
assessment system was introduced 
using SharePoint®. This allows 
the recording and tracking of risk 
assessment actions, including the 
issue of automatic reminders to those 
responsible for risk assessments.

The Strategic report was approved by 
the Board on 23rd July 2014 and signed 
on its behalf by

Sir David R McMurtry
Chairman and Chief Executive

 
 
 
58

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

 Introduction

David Grant
Senior independent director

The Board is ultimately responsible to 
shareholders for all of the Group’s activities, 
its strategy and ﬁnancial performance, 
for the efﬁcient use of the Group’s 
resources and for social, environmental 
and ethical matters.

With the assistance of the Audit 
committee, the Board approves the 
Group’s governance framework and 
reviews its risk management and 
internal control processes with a view to 
maintaining high standards of corporate 
governance throughout the Group.

The most signiﬁcant changes have 
been to our Directors’ remuneration 
report together with a binding vote 
at the AGM on our remuneration 
policy as well as a new requirement 
for a relationship agreement with 
our controlling shareholders.

The Board takes seriously its 
responsibilities for making sure that all 
employees are aware of their obligations 
to act with openness, honesty and 
transparency. These values are 
embedded in our Group Business 
Code and Anti-Bribery Policy which can 
be found at http://www.renishaw.com/
businesscode. In 2014, we carried 
on rolling out our anti-bribery training 
and since 2011, when we approved 
our policy, 713 relevant worldwide 
employees have received training.

During the last ﬁnancial year our 
governance framework has been 
enhanced to take into account the 
changes introduced by the September 
2012 edition of the UK Corporate 
Governance Code (the “Code”) and 
the commencement of The Large and 
Medium-sized Companies and Groups 
(Accounts and Reports) (Amendment) 
Regulations 2013 (the “Regulations”). 

Our 2013 externally facilitated Board 
evaluation by David Mensley of Equity 
Communications provided much 
positive and constructive feedback and 
in the period we were able to identify 
focus areas to ensure that the Board 
continues to operate in an open and 
transparent way and constructively 
challenges and supports the executive 
team. More details are provided on 
page 67.

Another key area was our ﬁrst investor 
day on 15th May 2014, attended by 
60 market participants where there 
was a wide range of presentations 
including corporate overview and 
strategy, ﬁnancial overview, business 
sector strategies, product and market 
overviews, healthcare and metrology 
product demonstrations as well as 
various Q&A sessions. Our investor 
relations website was also signiﬁcantly 
expanded during the year.

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59

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The UK Listing Authority’s Disclosure 
Rules and Transparency Rules, 
require the Annual report to include a 
management report which can be found 
in the Strategic report. 

For the purposes of the Disclosure Rules 
and Transparency Rules which require 
a corporate governance statement to 
be included in the directors’ report, 
the Company’s corporate governance 
practices are set out in the Directors’ 
corporate governance report, which 
forms part of the directors’ report. 

For the purposes of the UK Listing 
Authority’s Listing Rules, certain 
information required to be provided to 
the shareholders is also contained in 
the Directors’ corporate governance 
report, the Directors’ remuneration 
report and the Other statutory and 
regulatory disclosures including certain 
information relating to arrangements with 
controlling shareholders.

For the purposes of the Disclosure Rules 
and Transparency Rules, the information 
required by Section 7 of such rules is 
referred to in the Directors’ corporate 
governance report.

(cid:36)(cid:80)(cid:78)(cid:81)(cid:77)(cid:74)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:69)(cid:74)(cid:84)(cid:68)(cid:77)(cid:80)(cid:84)(cid:86)(cid:83)(cid:70)(cid:84)

The Directors’ corporate governance 
report and Other statutory and 
regulatory disclosures set out on pages 
64 to 84 form the directors’ report.

The Directors’ corporate governance 
report has been prepared in accordance 
with the Code issued by the Financial 
Reporting Council (“FRC”) which can be 
viewed on the www.frc.org.uk website. 
This report, which incorporates the 
reports of the Audit committee and 
Nomination committee, together with 
the Directors’ remuneration report, 
describes how we have applied the main 
principles of the Code. The edition of 
the Code published in September 2012 
applied throughout the period, but the 
Financial Conduct Authority has yet to 
change the Listing Rules and therefore 
requires that certain compliance 
statements are made in relation to 
the predecessor edition of the code, 
issued in June 2010. The Directors’ 
corporate governance report addresses 
the requirements of both editions of 
the Code.

We report on the operation of our 
business in the following ways:

A review of the business of the Group 
and likely future developments is given 
in the Chairman’s statement and the 
Strategic report. Segmental information 
by geographical market is given in note 2 
to the ﬁnancial statements.

 
 
 
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Governance

Board of directors and company secretary

Sir David McMurtry (74) 
CBE, RDI, FRS, FREng, CEng, FIMechE
Chairman and Chief Executive
(cid:116)(cid:1) Formerly employed by Rolls-Royce plc, 
Bristol, for 17 years, latterly holding the 
positions of Deputy Chief Designer and 
Assistant Chief of Engine Design of all 
Rolls-Royce engines manufactured at 
Filton, Bristol.

(cid:116)(cid:1) Invented the original measuring probe in 

the early 1970s and co-founded Renishaw 
with John Deer in 1973.

(cid:116)(cid:1) In addition to his role as Chairman and 
Chief Executive, Sir David also has 
responsibility for Group technology and  
is Chair of the Nomination committee. 

John Deer (76) 

Deputy Chairman
(cid:116)(cid:1) Trained as a mechanical engineer and 
worked for Rolls-Royce plc, Bristol,  
for 14 years.

(cid:116)(cid:1) Co-founded Renishaw with Sir David 

McMurtry in 1973. Managing Director of 
Renishaw from 1974 to 1989, primarily 
involved in the commercial direction of  
the Group, with particular emphasis on 
marketing and the establishment of the 
Group’s wholly-owned subsidiaries.

(cid:116)(cid:1) Responsible for group manufacturing  

and Chair of the overseas 
marketing subsidiaries.

Ben Taylor (65) 
CEng, FIMechE
Assistant Chief Executive
(cid:116)(cid:1) Before joining Renishaw Inc as President  

in 1985, Ben was the Director of 
Engineering at Shefﬁeld Measurement, 
USA. 

(cid:116)(cid:1) Appointed to the Board of Renishaw plc  

in 1987. 

(cid:116)(cid:1) Responsible for group marketing, 
international operations, human 
resources and metrology regulatory 
quality assurance.

(cid:116)(cid:1) Ben also reports to the Board on corporate 

social responsibility matters.

Allen Roberts (65)
FCA
Group Finance Director
(cid:116)(cid:1) Qualiﬁed as a chartered accountant in 

1972 with Peat, Marwick, Mitchell & Co. 
before joining Renishaw in 1979.

(cid:116)(cid:1) Appointed to the Board of Renishaw plc 

in 1980.

(cid:116)(cid:1)  Heads group ﬁnance, business systems 

and Wotton Travel Ltd.

(cid:116)(cid:1) Allen also has the healthcare regulatory 

and quality assurance functions reporting 
into him.

Geoff McFarland (46) 

Group Engineering Director
(cid:116)(cid:1) Graduated with a BEng in computer aided 
mechanical engineering at Heriot-Watt 
University, where he subsequently worked 
for several years as a research associate.

(cid:116)(cid:1) After working brieﬂy in the high-volume 
manufacturing electronic sector, joined 
Renishaw in 1994 and appointed to the 
Board of Renishaw plc in 2002.

(cid:116)(cid:1)  Heads the group engineering function 
and is also responsible for group IP 
and patents.

Carol Chesney (51)
FCA 
Non-executive director
(cid:116)(cid:1) Chair of the Audit committee and 
member of the Remuneration and 
Nomination committees.

(cid:116)(cid:1) Appointed to the Board of Renishaw plc  

in October 2012.

(cid:116)(cid:1) A chartered accountant who worked 
at Arthur Andersen for seven years in 
audit services.

(cid:116)(cid:1) Worked for some time in the group 

accounts function at English China Clays 
plc before joining Halma plc, where she is 
now Company Secretary, having also been 
Group Financial Controller.

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61

Norma Tang (50) 

Head of Legal and Company Secretary
(cid:116)(cid:1) Joined Renishaw in 2001.

(cid:116)(cid:1)  Qualiﬁed as a solicitor in 1988 and since 
then has specialised in company and 
commercial legal matters, advising 
business clients and as an  
in-house counsel.

(cid:116)(cid:1)  Heads the legal and company secretariat 
function, advising the Board on legal 
compliance and governance matters.

Dr David Grant (66)
CBE, FREng, FLSW, CEng, FIET
Senior independent director
(cid:116)(cid:1)  Member of the Nomination and 
Audit committees, Chair of the 
Remuneration committee.

John Jeans (64)
CBE, CEng 
Non-executive director
(cid:116)(cid:1) Member of the Audit, Remuneration and 

Nomination committees.

(cid:116)(cid:1)  Appointed to the Board of Renishaw plc  

(cid:116)(cid:1)  Appointed to the Board of Renishaw plc  

in April 2013.

in April 2012.

(cid:116)(cid:1)  Currently senior independent director  
of IQE plc, non-executive director of 
the Defence Science and Technology 
Laboratory, chair of STEMNET and 
member of the governing board of the 
Technology Strategy Board. 

(cid:116)(cid:1)  Was Vice-Chancellor of Cardiff University 
from 2001 to 2012 and previously held 
leadership positions at Dowty Group  
and GEC.

(cid:116)(cid:1)  Currently chair of the Council of Cardiff 

University, Imanova (an imaging 
research partnership between three 
London universities and the Medical 
Research Council) and the board of 
MRC Technology. 

(cid:116)(cid:1) Board member of the University and 

College Employers Association.

(cid:116)(cid:1)  Chairs of the Technology Strategy Board’s 
stratiﬁed medicine advisory board and 
is a Steering Board member of the 
HealthTech and Medicines Knowledge 
Transfer Network. 

(cid:116)(cid:1) John was appointed advisor to the Prime 
Minister at the Ofﬁce of Life Sciences in 
June 2014.

(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)(cid:1)(cid:67)(cid:66)(cid:77)(cid:66)(cid:79)(cid:68)(cid:70)

(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)(cid:1)(cid:85)(cid:70)(cid:79)(cid:86)(cid:83)(cid:70)

(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)(cid:1)(cid:79)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:66)(cid:77)(cid:74)(cid:85)(cid:90)

  Chairman 

  Executive  

  Non-executive 

  0–3 years  

  10+ years  

1

4

3

3

5

  UK 

  USA  

Ireland  

5

2

1

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Governance

Executive Board

Sir David McMurtry (74) 
CBE, RDI, FRS, FREng, 
CEng, FIMechE
Chairman and Chief Executive,  
Chair of Executive Board
 See pages 60 – 61 
for biography 

John Deer (76)
Deputy Chairman

 See pages 60 – 61 
for biography 

Ben Taylor (65) 
CEng, FIMechE
Assistant Chief Executive
 See pages 60 – 61 
for biography

Allen Roberts (65)
FCA
Group Finance Director
 See pages 60 – 61 
for biography

Geoff McFarland (46)
Group Engineering Director
 See pages 60 – 61 
for biography

Norma Tang (50)
Head of Legal and 
Company Secretary

 See pages 60 – 61 
for biography 

Leo Somerville (56) 

President,  
Renishaw Inc
(cid:116)(cid:1) Joined Renishaw in 1984.

(cid:116)(cid:1)  Initially served as Business 
Manager for machine tool 
probing and calibration 
products at Renishaw Inc. 

(cid:116)(cid:1) Became President of 

Renishaw Inc in 1993 and 
appointed to Executive Board 
in 2004. 

(cid:116)(cid:1)  Appointed as a member of 
the International Sales and 
Marketing Board in 2008. 

Dave Wallace (43)
M.Eng
Director and General Manager, 
CMM, styli and ﬁxturing products
(cid:116)(cid:1) Joined Renishaw in 1989 

through Renishaw’s 
sponsored student scheme.

(cid:116)(cid:1) Worked in various functions 
of the business including 
a one year secondment at 
Renishaw’s German 
subsidiary before being 
appointed Director and 
General Manager for the 
CMM product line in 2002.

(cid:116)(cid:1) Appointed to the Executive 

Board in 2008. 

 
 
 
 
 
 
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63

International Sales and Marketing Board

Kevin Gani (42) 

Sean Hymas (48) 

Rainer Lotz (49) 

Rhydian Pountney (53) 

Director of Sales Development 

(cid:116)(cid:1) Joined Renishaw in 2011 and 
was appointed Director of 
Sales Development in 2012.

President and Representative 
Director, Renishaw KK
(cid:116)(cid:1) Joined Renishaw in 1989 

following a year’s sandwich 
placement in 1987 – 1988.

(cid:116)(cid:1) Over 20 years’ experience in 
business development and 
sales management.

(cid:116)(cid:1) Over 20 years’ experience of 

international sales and product 
marketing experience.

(cid:116)(cid:1) Appointed as a member of 
the International Sales and 
Marketing Board in 2012.

(cid:116)(cid:1) Moved to Japan in 2008 
to further drive sales and 
marketing at Renishaw KK.

Managing Director, 
Renishaw GmbH
(cid:116)(cid:1) Joined Renishaw in 2006.

(cid:116)(cid:1) Over 15 years’ experience 

in related positions.

(cid:116)(cid:1)  Appointed as a member of 
the International Sales and 
Marketing Board in 2008.

(cid:116)(cid:1) Appointed President 

of Renishaw KK and to 
the International Sales 
and Marketing Board in 
December 2012.

Stewart Lane (42) 

Jean-Marc Meffre (60) 

Masumu Oishi (56) 

General Manager – UK Sales and 
Group Business Development
(cid:116)(cid:1) Graduated with a degree 
in Manufacturing Systems 
Engineering before 
working internationally for 
a number of years in the 
automotive industry.

(cid:116)(cid:1) Joined Renishaw 13 years 

ago working as both a design 
and business manager within 
the machine tool product line.

(cid:116)(cid:1) Appointed as the Group’s 
Business Development 
Manager in 2012 and General 
Manager for the UK sales 
organisation in 2013. 

Managing Director,  
Far East
(cid:116)(cid:1)  Joined Renishaw in 1988 
as Managing Director of 
Renishaw France.

(cid:116)(cid:1) Moved to Renishaw 
Hong Kong in 1997. 
Responsible for all the 
operations in the Far East and 
Australasia, except Japan.

(cid:116)(cid:1) Appointed as a member of 
the International Sales and 
Marketing Board in 2008.

Deputy Chairman,  
Renishaw KK
(cid:116)(cid:1)  Joined Renishaw in 1982 and 
was appointed as President 
of Renishaw KK in 2002 then 
Deputy Chairman in 2012.

(cid:116)(cid:1) Over 30 years’ experience in 
Japan’s machine tool industry.

(cid:116)(cid:1) Appointed as a member of 
the International Sales and 
Marketing Board in 2008.

General Manager,  
ROW sales
(cid:116)(cid:1) Joined Renishaw in 1979.

(cid:116)(cid:1) Appointed as a member of 
the International Sales and 
Marketing Board in 2008.

(cid:116)(cid:1) Over 30 years’ experience 
in sales and marketing. 
Responsible for 10 overseas 
operations including India 
and Russia.

(cid:116)(cid:1) UK Chair of the advanced 

manufacturing group of the 
UK – India joint economic and 
trade committee.

John Deer (76)
Deputy Chairman,  
Chair of International Sales and 
Marketing Board

 See pages 60 – 61 
for biography 

Allen Roberts (65)
FCA
Group Finance Director
  See pages 60 – 61 
for biography 

Ben Taylor (65) 
CEng, FIMechE
Assistant Chief Executive
 See pages 60 – 61 
for biography 

Leo Somerville (56)
President, Renishaw Inc

 See page 62 for biography 

Norma Tang (50)
Head of Legal and 
Company Secretary

 See pages 60 – 61 
for biography

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Governance

Directors’ corporate governance report

(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)(cid:1)(cid:84)(cid:85)(cid:83)(cid:86)(cid:68)(cid:85)(cid:86)(cid:83)(cid:70)(cid:1)

(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)

(cid:38)(cid:89)(cid:70)(cid:68)(cid:86)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)
(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)

(cid:51)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)

(cid:47)(cid:80)(cid:78)(cid:74)(cid:79)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)

(cid:34)(cid:86)(cid:69)(cid:74)(cid:85)(cid:1)
(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)

(cid:37)(cid:74)(cid:87)(cid:74)(cid:84)(cid:74)(cid:80)(cid:79)(cid:66)(cid:77)(cid:1)
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(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:84)(cid:86)(cid:67)(cid:84)(cid:74)(cid:69)(cid:74)(cid:66)(cid:83)(cid:90)(cid:1)
(cid:86)(cid:79)(cid:69)(cid:70)(cid:83)(cid:85)(cid:66)(cid:76)(cid:74)(cid:79)(cid:72)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68)

(cid:34)(cid:15)(cid:1)(cid:45)(cid:70)(cid:66)(cid:69)(cid:70)(cid:83)(cid:84)(cid:73)(cid:74)(cid:81)(cid:1)

(cid:53)(cid:73)(cid:70)(cid:1)(cid:83)(cid:80)(cid:77)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)
The Board comprises four executive 
and three non-executive directors in 
addition to the executive Chairman. 
The directors holding ofﬁce at 
the date of this report and short 
biographical details are given on pages 
60 and 61. Full biographical details 
are available on www.renishaw.com. 
The Company maintains liability 
insurance for its directors and ofﬁcers 
as disclosed in the Other statutory and 
regulatory disclosures.

There is a formal schedule of matters 
speciﬁcally reserved to it for decision. 
These include the approval of annual 
and half year results and interim 
management statements, company 
and business acquisitions and 
disposals, major capital expenditure, 

borrowings, material agreements, 
director and company secretary 
appointments and removals, any 
patent-related dispute and other material 
litigation, forecasts and major product 
development projects.

The Board meets as often as is 
necessary to discharge its duties 
effectively. In the ﬁnancial year ended 
30th June 2014, the Board met ten 
times and the directors’ attendance 
record at Board and committee 
meetings is set out at the end of this 
report. In addition, the non-executive 
directors met a number of times without 
executive directors present.

A high level summary of subject areas 
discussed during the year are set out 
on page 65.

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65

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(cid:52)(cid:85)(cid:83)(cid:66)(cid:85)(cid:70)(cid:72)(cid:90)

(cid:51)(cid:74)(cid:84)(cid:76)

(cid:40)(cid:80)(cid:87)(cid:70)(cid:83)(cid:79)(cid:66)(cid:79)(cid:68)(cid:70)

(cid:116)(cid:1) Business strategy

(cid:116)(cid:1) Group’s risk analysis

(cid:116)(cid:1) Reviewing potential acquisitions/disposals

(cid:116)(cid:1) Patent litigation

(cid:116)(cid:1) Products and technology

(cid:116)(cid:1) Engineering skills gap in schools initiatives

(cid:116)(cid:1) CSR targets

(cid:116)(cid:1) Legal updates and new 
disclosure requirements

(cid:116)(cid:1) Board evaluation and actions arising

(cid:116)(cid:1) Succession planning

(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:70)

(cid:116)(cid:1) Forecasts

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(cid:52)(cid:66)(cid:71)(cid:70)(cid:85)(cid:90)

(cid:116)(cid:1) AGM and other shareholder feedback

(cid:116)(cid:1) Health and safety system and reports

(cid:116)(cid:1) Oversight of the preparation and management  

(cid:116)(cid:1) Investor day

of the ﬁnancial statements

(cid:116)(cid:1) Dividend policy

(cid:116)(cid:1) Announcements

(cid:116)(cid:1) New investor relations website

(cid:41)(cid:51)

(cid:116)(cid:1) Pensions

(cid:116)(cid:1) Remuneration policy

(cid:116)(cid:1) Salary reviews

(cid:116)(cid:1) Bonus

The Board has three formally constituted 
committees, the Audit committee, 
the Remuneration committee and the 
Nomination committee. 

There is an executive management 
committee known as the Executive 
Board that is responsible for the executive 
management of the Group’s businesses. 
It is chaired by the Chairman and includes 
the executive directors of Renishaw 
plc and two senior management 
representatives responsible for the 
CMM product line and the North and 
Central American market, respectively. 
The Executive Board usually meets 
for two days on a monthly basis and 
considers the performance and strategic 
direction of the metrology and healthcare 
businesses and other matters of general 
importance to the Group. In addition, 
there is an executive sales and marketing 
committee known as the International 
Sales and Marketing Board which meets 
quarterly to determine the Group’s sales 

and marketing policies and strategies and 
review its sales and marketing activities. 
This committee is chaired by the Deputy 
Chairman and includes the Assistant 
Chief Executive and Group Finance 
Director plus the directors of the ﬁve 
largest sales subsidiaries and the Director 
of Sales Development. 

A framework of delegated authorities is 
in place that maps out the structure of 
delegation below board level and includes 
the matters reserved to the Executive 
Board and the level of authorities given to 
management below the Executive Board. 

The Board has adopted a conﬂict 
of interests policy, putting in place 
procedures for the disclosure and review 
of any conﬂicts and potential conﬂicts 
and authorisation by the Board (if felt 
appropriate). Authorisations granted and 
the terms of such are reviewed on an 
annual basis. New disclosures are made 
where applicable.

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Governance

Directors’ corporate governance report continued

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The role of Chairman and Chief 
Executive is a combined role and thus 
contrary to the recommendations of 
the Code. Sir David McMurtry has held 
this position since the Company became 
a quoted company in 1983 and he and 
John Deer hold the majority of the voting 
interests in the Company. 

There has been a voting agreement 
in place between Sir David and John 
Deer since 1983, further details of which 
are set out in the Other statutory and 
regulatory disclosures on page 82. 
The Board considers that there is still a 
clear division of responsibilities at Board 
level to ensure an appropriate balance 
of power and authority so that there is 
no one person with unfettered powers 
of decision. The Board and Executive 
Board meet on a sufﬁciently regular 
basis to make decisions of signiﬁcance 
to the metrology and healthcare 
business segments and review 
management actions. It is intended that 
this combined role will continue for so 
long as Sir David McMurtry remains 
on the Board and he and John Deer 
hold a majority of the voting interests 
in the Company. 

The Chairman has no other signiﬁcant 
commitments as regards employment 
or directorships of other companies. 

(cid:47)(cid:80)(cid:79)(cid:14)(cid:70)(cid:89)(cid:70)(cid:68)(cid:86)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)
David Grant is the senior independent 
director and is available to discuss 
material concerns with shareholders 
should the normal channels of the 
Chairman and Chief Executive 
or the Group Finance Director fail 
to resolve such concerns. The non-
executive directors meet without the 
executive directors present to discuss 
performance and other matters.

(cid:35)(cid:15)(cid:1)(cid:38)(cid:71)(cid:71)(cid:70)(cid:68)(cid:85)(cid:74)(cid:87)(cid:70)(cid:79)(cid:70)(cid:84)(cid:84)

(cid:36)(cid:80)(cid:78)(cid:81)(cid:80)(cid:84)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)
All the non-executive directors are 
considered by the Board to be 
independent in character and judgement 
and there are no relationships or 
circumstances that are likely to affect 
a non-executive director’s judgement. 

David Grant is on the boards of the 
Defence Science and Technology 
Laboratory, STEMNET and the 
Technology Strategy Board, with 
which the Company has dealings.  
The Company conﬁrms that David Grant 
has taken no part in decisions relating 
to any of the transactions between the 
Company and these organisations.

John Jeans is on the Council of Cardiff 
University and the board of MRC 
Technology, with which the Company 
has dealings. The Company conﬁrms 
that John Jeans has taken no part 
in decisions relating to any of the 
transactions between the Company 
and these organisations.

The transactions referred to above are 
not material.

The Code recommends that at least 
half the Board, excluding the Chairman, 
should comprise independent  
non-executive directors. The Board 
complied with this requirement during 
part of the year but due to retirements 
the Board is not at the date of this report 
compliant. A recruitment process has 
been commenced for an additional  
non-executive director as 
described below. 

(cid:34)(cid:81)(cid:81)(cid:80)(cid:74)(cid:79)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:85)(cid:80)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)
A description of the structure and 
activities of the Nomination committee 
are set out in the Nomination committee 
report on page 70.

(cid:36)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)
The terms of appointment of the non-
executive directors, which includes 
the expected time commitment from 
non-executive directors and requiring 
any changes to other signiﬁcant 
commitments to be discussed with 
the Chairman and Chief Executive in 
advance, are available for inspection at 
the AGM and at the registered ofﬁce 
upon written request.

None of the executive directors holds 
a directorship in a FTSE 100 company.

(cid:37)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)
Directors are offered the opportunity 
to attend formal training courses to 
update their knowledge of their duties as 
directors. Guidance notes on changes 
to law and regulations are provided as 
appropriate. Non-executive directors are 
invited to attend internal conferences, 
which provide information to the Group 
on new product development and 
marketing initiatives as well as our 
investor days, the ﬁrst of which was held 
in May 2014. Business presentations 
are given at Board meetings to provide 
updates on and opportunities to discuss 
products and business strategies. 

An induction pack is provided to new 
appointees to the Board and the 
induction programme (together with the 
continuing development programme) 
includes site visits and brieﬁngs by 
senior managers and attendance at 
internal senior management conferences 
and external trade shows, as well as 
foreign subsidiary visits, as applicable. 
For example, the newer Board members 
visited a number of foreign subsidiaries 
in the period including the USA, Hong 
Kong, Germany and Poland and 
attended strategy days and various 
trade shows.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

67

The Chairman and Chief Executive 
discusses performance with 
individual directors.

(cid:51)(cid:70)(cid:14)(cid:70)(cid:77)(cid:70)(cid:68)(cid:85)(cid:74)(cid:80)(cid:79)
In accordance with the Code all the 
directors will retire from the Board at the 
next AGM and will offer themselves up 
for re-election at the AGM. 

(cid:36)(cid:15)(cid:1)(cid:34)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:90)

(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:67)(cid:86)(cid:84)(cid:74)(cid:79)(cid:70)(cid:84)(cid:84)(cid:1)(cid:83)(cid:70)(cid:81)(cid:80)(cid:83)(cid:85)(cid:74)(cid:79)(cid:72)
The respective responsibilities of the 
directors and auditors in connection with 
the ﬁnancial statements are explained 
in Directors’ responsibilities on page 85 
and the Independent auditor’s report 
on page 86. 

(cid:39)(cid:66)(cid:74)(cid:83)(cid:13)(cid:1)(cid:67)(cid:66)(cid:77)(cid:66)(cid:79)(cid:68)(cid:70)(cid:69)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:86)(cid:79)(cid:69)(cid:70)(cid:83)(cid:84)(cid:85)(cid:66)(cid:79)(cid:69)(cid:66)(cid:67)(cid:77)(cid:70)
The directors consider that the Annual 
report, taken as a whole, is fair, balanced 
and understandable, and provides the 
information necessary for shareholders 
to assess the Group’s performance, 
business model and strategy.

(cid:40)(cid:80)(cid:74)(cid:79)(cid:72)(cid:1)(cid:68)(cid:80)(cid:79)(cid:68)(cid:70)(cid:83)(cid:79)
The Group’s strategy for delivering its 
objectives and its business model, 
together with the factors likely to affect 
its future development, performance 
and position are set out in the Strategic 
report, where are also given details 
of the ﬁnancial and liquidity positions. 
In addition, note 22 in the ﬁnancial 
statements includes the Group’s 
objectives and policies for managing its 
capital, details of its ﬁnancial instruments 
and hedging activities and its exposures 
to credit risk and liquidity risk.

The Group has considerable ﬁnancial 
resources at its disposal and the 
directors have considered the current 
ﬁnancial projections. As a consequence, 
the directors believe that the Group 
is well placed to manage its business 
risks successfully.

After making enquiries, the directors 
have a reasonable expectation that the 
Company and the Group have adequate 
resources to continue in operational 
existence for the foreseeable future. 
Accordingly, they continue to adopt the 
going concern basis in preparing the 
Annual report and accounts.

(cid:51)(cid:74)(cid:84)(cid:76)(cid:1)(cid:78)(cid:66)(cid:79)(cid:66)(cid:72)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:74)(cid:79)(cid:85)(cid:70)(cid:83)(cid:79)(cid:66)(cid:77)(cid:1)
(cid:68)(cid:80)(cid:79)(cid:85)(cid:83)(cid:80)(cid:77)
The Board is responsible for the 
Company’s systems of risk management 
and internal control and for reviewing 
their effectiveness. Any system of 
internal control is designed to manage 
rather than eliminate the risk of failure 
to achieve business objectives and 
can only provide reasonable and not 
absolute assurance against material 
misstatement or loss. 

There are deﬁned lines of responsibility 
and delegation of authorities. 
There are also established and centrally 
documented control procedures, 
including, for example, capital and other 
expenditure, information and technology 
security, and legal and regulatory 
compliance. These are applied 
throughout the Group.

(cid:42)(cid:79)(cid:71)(cid:80)(cid:83)(cid:78)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:84)(cid:86)(cid:81)(cid:81)(cid:80)(cid:83)(cid:85)
The Board receives appropriate 
documentation, management accounts, 
forecasts and commentaries thereon 
in advance of each Board meeting 
to enable its members to review the 
ﬁnancial performance of the Group, 
current trading and key business 
initiatives. Regular ﬁnancial updates 
are also provided between meetings. 
The company secretary advises the 
Board on all governance matters. 
All directors have access to the 
company secretary and to independent 
professional advice at the Company’s 
expense where necessary to discharge 
their responsibilities as directors. 
The appointment and removal of the 
company secretary is a matter reserved 
for the Board.

(cid:38)(cid:87)(cid:66)(cid:77)(cid:86)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
The Board and committees 
undertake an annual evaluation of 
their performance. The format for 
the evaluation varies each year. 
Last year David Mensley of Equity 
Communications Limited was appointed 
to undertake an externally facilitated 
evaluation through use of a thorough 
questionnaire focusing on topics such 
as board effectiveness, corporate 
strategy, risk oversight, training and 
board administration. The process 
also included the Board committees. 
Equity Communications Limited 
has no other connection with the 
Company. Following the evaluation the 
Board worked on the improvement 
of meeting administration (including 
agendas), dissemination of updated 
ﬁnancial information and provision of 
summaries of Executive Board meetings 
to non-executive directors shortly 
after each Executive Board meeting. 
A strategy day was also held. This year 
an internal evaluation has been carried 
out and comments supplied by the 
directors were discussed and action 
points agreed.

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68

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Directors’ corporate governance report continued

The group internal audit function 
provides independent and objective 
assurance that the procedures are 
appropriate and effectively applied. 
The Group Audit Manager attends Audit 
committee meetings to present annual 
internal audit plans and the results 
of such internal audits. Actions are 
monitored by the Audit committee 
on an ongoing basis. 

There is a process for the review of 
business risks throughout the Group. 
These are reported on a monthly basis 
by senior management and overseas 
subsidiaries. These reports are reviewed 
by the Board.

The Board ensures that there are 
effective internal controls over the 
ﬁnancial reporting and consolidation 
processes. Monthly accounts and 
forecasts are presented to the Board for 
review. The Group internal audit function 
undertakes a programme of review of 
subsidiaries’ accounting processes and 
performance to provide assurance to the 
Board on the integrity of the information 
supplied by each company which 
forms part of the consolidated results 
of the Group.

The Board undertakes an annual 
formal review of the effectiveness of the 
Group’s system of internal controls and 
an updated risk and controls analysis for 
the Group. The review covers all material 
controls, including ﬁnancial, operational 
and compliance controls and risk 
management systems.

The Board considers that there is 
an ongoing process for identifying, 
evaluating and managing the signiﬁcant 
risks facing the Group that has been 
in place during the year, is regularly 
reviewed and accords with the Turnbull 
guidance. The Board conﬁrms that 
necessary action has been or is being 
taken to remedy any signiﬁcant failings 
or weaknesses identiﬁed from its review.

(cid:34)(cid:86)(cid:69)(cid:74)(cid:85)(cid:1)(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:86)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)(cid:1)
A description of the structure and 
activities of the Audit committee are set 
out in the Audit committee report on 
pages 71 to 73.

(cid:37)(cid:15)(cid:1)(cid:51)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

The Directors’ remuneration report 
explains how the Company applies the 
Code principles relating to remuneration.

(cid:38)(cid:15)(cid:1)(cid:51)(cid:70)(cid:77)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)(cid:88)(cid:74)(cid:85)(cid:73)(cid:1)
(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:70)(cid:83)(cid:84)(cid:1)

(cid:37)(cid:74)(cid:66)(cid:77)(cid:80)(cid:72)(cid:86)(cid:70)(cid:1)(cid:88)(cid:74)(cid:85)(cid:73)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:70)(cid:83)(cid:84)
The Board announced a new policy 
in the 2013 Annual report. No private 
meetings will be held other than 
shareholder meetings with the 
Chairman, Senior independent director 
and/or any other non-executive 
director where a shareholder has 
material issues, concerns or questions. 
The director attending such a meeting 
will communicate the shareholder’s 
issues, concerns or questions to the 
Board. The Board’s response will be 
published on the Renishaw website for 
the beneﬁt of all shareholders where 
appropriate. The interim and annual 
results and presentations are posted on 
the Company’s website promptly after 
announcement of the results to the UK 
Listing Authority via an RIS. 

Open webcasts of presentations on 
annual and half-yearly results are held 
and recordings of the presentations 
and the subsequent question and 
answer sessions made available after 
the webcast on the Company’s website. 
Analysts’ and brokers’ reports will be 
circulated to the Board. The Board 
intends to hold open discussions with 
any shareholder who wishes to share 
views with the directors at the AGM 
or the annual investor day at which 
presentations on Group strategy, 
business segments and product lines 
will be given by members of the Board 
and senior management, as well as 
tours covering the Group’s activities. 
This year 60 market participants 
attended the Company’s inaugural 
investor day which included a Q&A with 
the Board. Open days with appropriate 
notice may be organised from time to 
time at the Company’s site. The investor 
relations website has been signiﬁcantly 
expanded in the period including a range 
of corporate videos which are being 
developed. This is an ongoing process. 

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

69

(cid:36)(cid:80)(cid:79)(cid:84)(cid:85)(cid:83)(cid:86)(cid:68)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)(cid:86)(cid:84)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:34)(cid:40)(cid:46)
The AGM takes place at the Company’s 
headquarters or one of the Company’s 
other sites and formal notiﬁcation is sent 
to the shareholders at least 20 working 
days before the meeting. A business 
presentation is given and all directors are 
available for questions during and after 
the meeting, including the chairs of the 
Audit, Remuneration and Nomination 
committees. Tours of the Company’s 
facilities are offered.

The Company reports on the number 
of proxy votes lodged on each 
resolution, the balance for and against 
each resolution and the number of 
votes withheld after the resolution 
has been dealt with on a show of 
hands. This information is provided 
to the shareholders attending the 
AGM and published via an RIS and 
on the Company’s website following 
the meeting.

(cid:37)(cid:74)(cid:84)(cid:68)(cid:77)(cid:80)(cid:84)(cid:86)(cid:83)(cid:70)(cid:1)(cid:83)(cid:86)(cid:77)(cid:70)(cid:1)(cid:37)(cid:53)(cid:51)(cid:1)(cid:24)(cid:15)(cid:19)(cid:15)(cid:23)(cid:1)(cid:51)

(cid:36)(cid:80)(cid:78)(cid:81)(cid:77)(cid:74)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)

The information regarding share capital 
required to be disclosed by this rule is 
contained in the Other statutory and 
regulatory disclosures.

(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)(cid:1)
(cid:78)(cid:70)(cid:70)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:85)(cid:85)(cid:70)(cid:79)(cid:69)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:83)(cid:70)(cid:68)(cid:80)(cid:83)(cid:69)

Shown against each director’s name 
in the table below is the number 
of meetings of the Board and its 
committees at which the director was 
present and, in brackets, the number of 
meetings that the director was eligible to 
attend during the year.

The Board considers that it has 
complied with the requirements of the 
Code throughout the year except in 
relation to the following matters (the 
reasons for non-compliance are stated 
in the report above):

- the combined role of chairman and 

chief executive (code provision A.2.1); 
and

- for part of the year at least half 
the board did not comprise 
independent non-executive 
directors (code provision B.2.1).

David Grant
Senior independent director
23rd July 2014

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(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)(cid:1)(cid:66)(cid:85)(cid:85)(cid:70)(cid:79)(cid:69)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:83)(cid:70)(cid:68)(cid:80)(cid:83)(cid:69)

(cid:37)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)

Sir David McMurtry

D J Deer

B R Taylor

A C G Roberts

G McFarland

C T Chesney

D Grant

D J Jeans*

W H Whiteley**

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Board

10 (10)

10 (10)

10 (10)

10 (10)

10 (10)

10 (10)

10 (10)

8 (9)

2 (3) 

Audit
committee

Remuneration
committee

–

–

–

–

–

3 (3)

3 (3)

3 (3)

2 (2)

–

–

–

–

–

3 (3)

3 (3)

2 (3)

2 (2)

Nomination
committee

6 (6)

–

–

–

–

6 (6)

6 (6)

4 (6) 

0 (0)

*  John Jeans partly attended one board meeting because of a commitment to attend a Ministerial Medical Technology Strategy Group and did not attend 

committee meetings held on that day. He did not attend board and committee meetings held on another day for family medical reasons.

** Bill Whiteley did not attend the board meeting held on the day of the AGM 2013 as he was not being put forward for re-election.

 
 
 
70

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Nomination committee report

Sir David R McMurtry
Chairman and Chief Executive
Chair of the Nomination committee

“The Nomination committee has an important 
role in leading the process for Board 
appointments and ensuring that the Board 
has the correct balance of experience, 
diversity and skills to support our business 
model and strategy.”

(cid:47)(cid:80)(cid:78)(cid:74)(cid:79)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)(cid:1)(cid:83)(cid:80)(cid:77)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:80)(cid:84)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)

The Nomination committee, which meets on an ad hoc basis as required, 
is responsible for reviewing the size, structure and composition of the Board 
including its balance of skills, knowledge and experience and for nominating 
candidates for appointment to the Board. 

The members of the Nomination committee are Sir David McMurtry (Chair), 
Carol Chesney, David Grant and John Jeans. The majority of the members of 
this committee are independent non-executive directors. The terms of reference 
of this committee are published on the Company’s website. 

(cid:34)(cid:68)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)(cid:1)(cid:69)(cid:86)(cid:83)(cid:74)(cid:79)(cid:72)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

(cid:35)(cid:80)(cid:66)(cid:83)(cid:69)(cid:83)(cid:80)(cid:80)(cid:78)(cid:1)(cid:69)(cid:74)(cid:87)(cid:70)(cid:83)(cid:84)(cid:74)(cid:85)(cid:90)

The committee met six times during the 
year. Further details are on page 69.

A recruitment consultant, CT Partners 
Augmentum, was engaged to seek 
appropriate candidates for appointment 
as an additional non-executive 
director following a review of the 
composition of the Board and the 
experience represented. The shortlist 
for interviews was to include candidates 
that have the required skills and 
experience and, where possible, at 
least one-third to be female candidates. 
This recruitment process is currently 
ongoing. CT Partners Augmentum has 
no other connection with the Company. 
Appropriate succession plans for the 
Board and senior executives were 
also discussed.

The Board has considered the 
recommendations of the “Women on 
Boards” report issued by Lord Davies 
of Abersoch as regards setting out 
aspirations for the appointment of 
women to the board by 2013 and 2015 
and has decided that it is inappropriate 
to set out any levels that may require 
positive discrimination in this respect, as 
the overriding requirement is to appoint 
directors with the necessary skills and 
experience for the role. 

However, as an international company, 
the Board acknowledges that diversity 
of all types is a beneﬁt and should be 
borne in mind when recruiting to all roles 
within the Company and has a policy 
to provide equal opportunities to all. 
The Board’s policy is to request where 
recruitment consultants are appointed, 
that a proportion of female candidates 
are included in their shortlist.

Sir David R McMurtry
Chair of the Nomination committee
23rd July 2014

Audit committee report

Carol Chesney
Non-executive director
Chair of the Audit committee

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

71

“The Audit committee has a vital role to 
play in ensuring the integrity of our ﬁnancial 
statements and the effectiveness of our 
risk management processes and internal 
controls. During 2014 we also monitored the 
various changes to the Code and this report 
explains how we fulﬁlled our duties.”

(cid:34)(cid:86)(cid:69)(cid:74)(cid:85)(cid:1)(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)(cid:1)(cid:83)(cid:80)(cid:77)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:80)(cid:84)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)

The Audit committee reviews the accounting policies and procedures of the 
Group, its annual and interim ﬁnancial statements before submission to the 
Board and its compliance with statutory requirements. The committee monitors 
the integrity of the Group’s ﬁnancial statements and announcements relating to 
ﬁnancial performance and reviews the signiﬁcant reporting judgements contained 
therein. It also reviews the scope, remit and effectiveness of the internal control 
systems and internal audit function. Further details are provided below.

The Audit committee comprises the three non-executive directors, Carol Chesney 
(Chair), David Grant and John Jeans. The Board is satisﬁed that at least one 
member of the committee has recent and relevant ﬁnancial experience, being 
Carol Chesney. The terms of reference of this committee were reviewed during 
the year and are available on the Company’s website.

(cid:46)(cid:70)(cid:70)(cid:85)(cid:74)(cid:79)(cid:72)(cid:84)

The committee meets at least three 
times a year with the Group Finance 
Director, the Group Financial Controller, 
the Group Audit Manager and the 
external auditors in attendance. 
At least one meeting, or part thereof, is 
held with the external auditor without 
executive directors present. This year 
the committee met three times, further 
details are on page 69.

(cid:39)(cid:66)(cid:74)(cid:83)(cid:13)(cid:1)(cid:67)(cid:66)(cid:77)(cid:66)(cid:79)(cid:68)(cid:70)(cid:69)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)
(cid:86)(cid:79)(cid:69)(cid:70)(cid:83)(cid:84)(cid:85)(cid:66)(cid:79)(cid:69)(cid:66)(cid:67)(cid:77)(cid:70)(cid:1)(cid:83)(cid:70)(cid:81)(cid:80)(cid:83)(cid:85)(cid:1)
and accounts

One of the key governance requirements 
is for the Annual report to be fair, 
balanced and understandable. 
Ensuring that this standard is met 
requires continuous assessment of the 
ﬁnancial reporting issues affecting the 
Group on a year-round basis in addition 
to a number of focused exercises 
that take place during the accounts 
production process within a strict 
time frame. 

An extensive veriﬁcation exercise 
was undertaken to ensure the factual 
accuracy of the Annual report by 

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72

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Audit committee report continued

the Board and senior management. 
An advanced draft of the Annual report 
was considered by the committee at 
its meeting on 9th July 2014 with a 
ﬁnal draft being reviewed on 18th July 
2014 prior to it being presented to the 
Board. Following those discussions, the 
committee advised the Board that the 
Annual report, taken as a whole is fair, 
balanced and understandable.

The directors’ statement on a fair, 
balanced and understandable annual 
report is set out on page 67. 

Significant issues in r(cid:70)(cid:77)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
to the financial statements

As part of the reporting and review 
process, the committee has regular 
discussions with management and the 
external auditor relating to signiﬁcant 
issues. During the year the committee 
considered the signiﬁcant issues set 
out below in relation to the ﬁnancial 
statements. Also contained below is 
a commentary on how these issues 
were addressed:

(cid:74)(cid:10)(cid:1)(cid:53)(cid:73)(cid:70)(cid:1)(cid:68)(cid:66)(cid:83)(cid:83)(cid:90)(cid:74)(cid:79)(cid:72)(cid:1)(cid:87)(cid:66)(cid:77)(cid:86)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:72)(cid:80)(cid:80)(cid:69)(cid:88)(cid:74)(cid:77)(cid:77)
The committee focused on the 
impairment testing by the Company 
of the carrying value of goodwill. 
By applying knowledge and making 
enquiries of the relevant cash generating 
units, reviewing the forecasts and the 
sensitivity analysis, the committee 
agreed with the conclusion reached that 
no impairments were required.

(cid:74)(cid:74)(cid:10)(cid:1)(cid:53)(cid:73)(cid:70)(cid:1)(cid:68)(cid:66)(cid:83)(cid:83)(cid:90)(cid:74)(cid:79)(cid:72)(cid:1)(cid:87)(cid:66)(cid:77)(cid:86)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:74)(cid:79)(cid:87)(cid:70)(cid:79)(cid:85)(cid:80)(cid:83)(cid:90)
Provisions are made to write down 
slow-moving and obsolete inventory 
items to net realisable value, based 
on an assessment of technological 
and market developments and on 
an analysis of historic and projected 
demand. The assessment used 
to calculate the provisions needed 
requires the application of judgement 
by management. 

The committee received conﬁrmation 
from management that the approach 
used to determine the provision was 
consistent with the previous year and 
made enquiries of management to gain 
an understanding of how business 
developments, both technological 
and market driven, had impacted the 
provision during the year. The external 
auditor explained to the committee 
the work they had performed on 
inventory provisions during the year. 
The committee was satisﬁed that the 
management judgements applied were 
appropriate and that the provision was 
appropriately stated at the year end.

(cid:34)(cid:81)(cid:81)(cid:83)(cid:80)(cid:66)(cid:68)(cid:73)(cid:1)(cid:85)(cid:80)(cid:1)(cid:66)(cid:86)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)(cid:1)
(cid:66)(cid:81)(cid:81)(cid:80)(cid:74)(cid:79)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:86)(cid:69)(cid:74)(cid:85)(cid:1)(cid:82)(cid:86)(cid:66)(cid:77)(cid:74)(cid:85)(cid:90)

The committee has primary 
responsibility for making the 
recommendation on the appointment, 
reappointment and removal of the 
external auditor, which the Board puts 
to shareholders for approval at the 
AGM. During the previous ﬁnancial 
year, the committee adopted policies 
on non-audit services and audit 
services provision. KPMG LLP and its 
predecessor ﬁrms have been auditor 
since 1974 and the lead audit partner 
has changed in line with their internal 
rotation requirements. There has been 
no tender for audit services since 1974. 
It is intended that a tender for the audit 
will take place in 2017. 

When tendering for audit services, 
tenders will not be assessed solely 
on the basis of lowest fees, but on a 
number of issues such as:

(cid:116)(cid:1) skills and knowledge of the team 

proposed to do the work;

(cid:116)(cid:1) quality of work;

(cid:116)(cid:1) independence of the audit ﬁrm from 

the Company;

(cid:116)(cid:1) audit partner rotation and 

succession planning;

(cid:116)(cid:1) global coverage for the 
Company’s subsidiaries;

(cid:116)(cid:1) value for money;

(cid:116)(cid:1) audit approach and methodology;

(cid:116)(cid:1) internal governance processes;

(cid:116)(cid:1) technical capabilities of the ﬁrm as 

a whole; and

(cid:116)(cid:1) ethical behaviour and fair dealing.

The committee assesses the 
effectiveness of the external audit 
process and the quality of the audit work 
throughout the year by considering:

(cid:116)(cid:1) any issues arising from the prior 

year audit;

(cid:116)(cid:1) the proposed audit plan including 
the identiﬁcation of risks speciﬁc 
to the Group, audit scope and 
materiality thresholds;

(cid:116)(cid:1) feedback from the 

executive management;

(cid:116)(cid:1) the delivery of the audit in line with 

the plan;

(cid:116)(cid:1) the communication of matters arising 
during the audit to the committee;

(cid:116)(cid:1) private meetings with the auditor 

without management being present; 
and

(cid:116)(cid:1) the independence and objectivity 

of the auditor.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

73

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(cid:48)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:78)(cid:66)(cid:85)(cid:85)(cid:70)(cid:83)(cid:84)

The committee reviews the policy by 
which employees of the Company may, 
in conﬁdence, raise matters of concern, 
including possible improprieties in 
ﬁnancial reporting or other matters. 
It also monitors the effectiveness of 
the Company’s procedures to avoid 
any bribery related to the activities of 
the Group.

Carol Chesney
Chair of the Audit committee
23rd July 2014

(cid:42)(cid:79)(cid:69)(cid:70)(cid:81)(cid:70)(cid:79)(cid:69)(cid:70)(cid:79)(cid:68)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:70)(cid:89)(cid:85)(cid:70)(cid:83)(cid:79)(cid:66)(cid:77)(cid:1)
(cid:66)(cid:86)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)

In order to safeguard the independence 
and objectivity of the external auditor, the 
committee reviews the nature and extent 
of the non-audit services supplied, 
receiving reports on the balance of 
audit to non-audit fees. The committee 
regards it most cost efﬁcient to use the 
external auditor for tax advice and 
compliance since this requires an 
in-depth knowledge and understanding 
of the Company’s business, products, 
customer base and markets. The 
non-audit services policy provides 
that the auditor shall not be allowed 
to provide services where there is 
involvement in management functions 
or management decision making; and/or 
any service on which management may 
place primary reliance in determining the 
adequacy of internal controls, ﬁnancial 
systems or ﬁnancial reporting. There are 
also speciﬁed services which require the 
prior approval of the Group Finance 
Director and Audit committee chair 
before the auditor may be appointed 
to provide such services. In addition 
there are speciﬁed levels of authorisation 
to be obtained before the auditor 
may be permitted to tender for  
non-audit services.

An analysis of fees paid to KPMG LLP, 
including the split between audit and 
non-audit services, is included in note 6 
to the accounts.

 
 
 
74

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Directors’ remuneration report

(cid:52)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:68)(cid:73)(cid:66)(cid:74)(cid:83)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:51)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)

(cid:51)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:85)(cid:70)(cid:70)(cid:1)(cid:83)(cid:80)(cid:77)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:80)(cid:84)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)

The Remuneration committee is responsible for deciding the Company’s 
framework of executive director remuneration and setting remuneration packages 
for each of the executive directors.

The committee’s policy is to motivate and retain executive directors by rewarding 
them with competitive salary and beneﬁt packages and incentives. These are 
linked to the overall performance of the Group and, in turn, to the interests of 
the shareholders. 

The committee reviews annually the executive directors’ remuneration in the 
context of the Company’s performance during the year.

All the members of the committee are non-executive directors, comprising 
David Grant (Chair), Carol Chesney and John Jeans. The terms of reference of 
the committee are published on the Company’s website. No executive director 
attends meetings of the committee.

David Grant
Senior independent director
Chair of the Remuneration committee

On behalf of the Board, I am pleased 
to present the Directors’ remuneration 
report for 2014.

The report complies with the new 
requirements for reporting on directors’ 
pay introduced in October 2013 and is 
split into the following three sections:

1.  a statement from the Chair of the 

Remuneration committee;

2.  a policy report, setting out the 

directors’ remuneration policy of the 
Company; and

3.  an annual report on remuneration, 

setting out information on directors’ 
remuneration paid during the year.

The remuneration policy set out in 
this Directors’ remuneration report 
will be presented for consideration 
by a binding vote at the AGM to be 
held on 16th October 2014 and, if 
approved, unless there is a material 
change in circumstances requiring an 
amended policy to be presented to the 
shareholders (see further comments 
below), we expect this policy to apply for 
three years with effect from the AGM.

The rest of the Directors’ remuneration 
report, excluding the remuneration policy 
will be presented to the AGM for an 
advisory vote.

The Remuneration committee’s 
approach continues to be to align 
executive director remuneration with 
the Group’s performance, using clear 
and simple remuneration structures. 

During the year, the committee approved 
executive directors’ base salaries for 
2014 and the executive director bonus 
for 2013 in line with the programme set 
for that year and considered and set 
the executive director annual bonus 
programme for 2014. In relation to the 
2014 annual bonus, we reviewed the 
bonus targets and moved from a target 
based on earnings per share used in 
previous years, to a more transparent 
proﬁt before tax target, but continuing 
with the same structure.

In relation to setting remuneration 
for the next ﬁnancial year, the 
committee has taken into account the 
economic environment and employee 
remuneration conditions within the UK 
and the overseas markets in which 
we operate, together with employee 
retention and recruitment reviews. 

Renishaw executive directors do not 
participate in a long-term incentive plan 
(“LTIP”). The Remuneration committee 
recognises that this is unusual 
compared to many other companies, 
and annually we therefore question 
whether Renishaw’s performance would 
be enhanced through the introduction of 
such a scheme. There is no evidence, 
however, that the excellent performance 
in the past has been diminished in any 
way by the lack of a scheme. However, 
the Remuneration committee will 
continue to question and explore the 
potential value of LTIPs and next year 
we will investigate whether a longer 
term plan could be introduced and if so, 
the form of such plan, which would be 
subject to shareholder approval. 

David Grant
Chair, Remuneration committee

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

75

(cid:51)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:90)

This section of the Directors’ remuneration report sets out the directors’ remuneration policy of the Company. It is the ﬁrst policy 
to be presented to the shareholders for approval.

(cid:38)(cid:89)(cid:70)(cid:68)(cid:86)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:8)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:90)(cid:1)(cid:85)(cid:66)(cid:67)(cid:77)(cid:70)

Set out below is a table describing each component of the remuneration package applicable to the executive directors.

(cid:38)(cid:77)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

(cid:49)(cid:86)(cid:83)(cid:81)(cid:80)(cid:84)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:1)
(cid:83)(cid:70)(cid:77)(cid:70)(cid:87)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:85)(cid:80)(cid:1)(cid:84)(cid:85)(cid:83)(cid:66)(cid:85)(cid:70)(cid:72)(cid:90)

(cid:48)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

(cid:46)(cid:66)(cid:89)(cid:74)(cid:78)(cid:86)(cid:78)

(cid:35)(cid:66)(cid:84)(cid:70)(cid:1)(cid:84)(cid:66)(cid:77)(cid:66)(cid:83)(cid:90)

To provide a 
competitive ﬁxed 
salary to motivate 
and retain executive 
directors of the required 
quality to meet the 
Group’s objectives.

Renishaw aims to pay the 
base rate salary at least at 
the current median market 
rate or above, as compared 
to the equivalent job position/
level in the relevant industrial 
sector(s) applicable to 
Renishaw, as deﬁned in the 
appropriate benchmarking 
pay surveys, statistics and 
peer comparisons (such peer 
selection to include factors 
such as size and location).

Base salary is reviewed 
annually taking into account the 
award for the UK workforce. 

(cid:35)(cid:70)nefi(cid:85)(cid:84)

To provide market-
competitive beneﬁts 
to motivate and retain 
executive directors of 
the required quality 
to meet the Group’s 
objectives and to 
support them to give 
maximum attention to 
their role.

Beneﬁts provided on an 
ongoing basis include the 
following principal beneﬁts: 

(cid:116)(cid:1) a car or car allowance; 

(cid:116)(cid:1) private medical insurance;

(cid:116)(cid:1) life assurance; 

(cid:116)(cid:1) long-term disability cover;

(cid:116)(cid:1) home telephone costs.

110% of median 
salaries in a comparator 
group as decided 
by the committee. 
Renishaw has historically 
paid base salaries that 
are higher than median, 
reﬂecting the lack of an 
LTIP (see Statement on 
page 74).

The committee retains 
the discretion to make 
adjustments at the 
annual review to take 
into account matters 
affecting an individual 
director such as changes 
in responsibility and 
anomalies discovered 
during benchmarking.

Excluding 
accommodation and 
relocation costs, not to 
exceed £50k p/a.

(cid:49)(cid:70)(cid:83)(cid:71)(cid:80)(cid:83)(cid:78)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:1)
(cid:78)(cid:70)(cid:66)(cid:84)(cid:86)(cid:83)(cid:70)(cid:84)

To reﬂect the 
director’s role, 
performance 
and experience.

Not applicable.

If, on the recruitment of a new 
executive director, relocation is 
required to the director’s place 
of work, relocation support 
which is regarded by the 
committee to be necessary to 
provide appropriate support to 
the director will be provided to 
cover items such as transaction 
and legal fees, removals and 
temporary accommodation 
and subsistence costs. 

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(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Directors’ remuneration report continued

(cid:51)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:90)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

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(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

(cid:49)(cid:86)(cid:83)(cid:81)(cid:80)(cid:84)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:1)
(cid:83)(cid:70)(cid:77)(cid:70)(cid:87)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:85)(cid:80)(cid:1)(cid:84)(cid:85)(cid:83)(cid:66)(cid:85)(cid:70)(cid:72)(cid:90)

(cid:48)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

(cid:46)(cid:66)(cid:89)(cid:74)(cid:78)(cid:86)(cid:78)

(cid:35)(cid:80)(cid:79)(cid:86)(cid:84)

To incentivise and 
reward execution of  
the Group’s objectives.

100% of salary.

The committee sets group 
performance targets, including 
a baseline below which no 
bonus is earned, with a bonus 
payable from that point, 
increasing on a straight-line 
basis to a target at which 75% 
of salary would be earned and 
a cap at which a maximum 
100% of salary would 
be earned. 

Part or all of any bonus 
paid may be subject to 
repayment in the case of 
any ﬁnancial misstatement, 
errors in calculation or 
gross misconduct.

(cid:49)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)

To provide a 
competitive pension as 
appropriate to motivate 
and retain executive 
directors of the required 
quality to meet the 
Group’s objectives.

Each of Allen Roberts, Ben 
Taylor and Geoff McFarland 
receive an additional payment 
of 15% of base salary, being the 
amount that would otherwise 
be contributed to a pension 
scheme on their behalf.

The maximum 
contribution to the deﬁned 
contribution scheme, 
or, where applicable, 
additional salary payment 
in lieu of contributions will 
be 15% of base salary.

(cid:49)(cid:70)(cid:83)(cid:71)(cid:80)(cid:83)(cid:78)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:1)
(cid:78)(cid:70)(cid:66)(cid:84)(cid:86)(cid:83)(cid:70)(cid:84)

Based on group 
performance, 
primarily ﬁnancial, 
but the committee 
may introduce non-
ﬁnancial metrics or 
make adjustments 
to reﬂect appropriate 
performance or 
competitive factors, 
provided that the 
bonus will always 
be subject to 
achievement of the 
baseline ﬁnancial 
targets and such 
non-ﬁnancial metrics 
shall not form more 
than 25% of the 
bonus opportunity.

Not applicable.

For any new executive director, 
annual contributions based on 
a percentage of base salary 
will be made to the Company’s 
deﬁned contribution scheme 
or additional salary may be 
paid in lieu, as agreed by 
the committee.

Geoff McFarland is a deferred 
member of the Company’s 
deﬁned beneﬁt scheme which 
closed for future accruals on 
5th April 2007.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

77

(cid:47)(cid:80)(cid:79)(cid:14)(cid:70)(cid:89)(cid:70)(cid:68)(cid:86)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:8)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:90)(cid:1)(cid:85)(cid:66)(cid:67)(cid:77)(cid:70)

The remuneration of the non-executive directors is determined by the executive directors and consists of a fee only. There is no 
entitlement to any beneﬁts, bonus, incentive plans or pension. Set out below is a table showing the fees for the non-executive 
directors of the Company:

(cid:38)(cid:77)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

(cid:49)(cid:86)(cid:83)(cid:81)(cid:80)(cid:84)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:1)
(cid:83)(cid:70)(cid:77)(cid:70)(cid:87)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:85)(cid:80)(cid:1)(cid:84)(cid:85)(cid:83)(cid:66)(cid:85)(cid:70)(cid:72)(cid:90)

(cid:48)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

(cid:46)(cid:66)(cid:89)(cid:74)(cid:78)(cid:86)(cid:78)

(cid:39)(cid:70)(cid:70)

To provide a 
competitive fee to 
motivate and retain 
non-executive directors 
of the required 
quality to meet the 
Group’s objectives.

The maximum fees 
payable will be set by the 
Company’s Articles of 
Association, currently an 
aggregate of £300,000 
per annum.

The non-executive directors are 
paid the same fee, irrespective 
of membership of or acting as a 
Chair of a committee.

The fees are reviewed annually 
with reference to fees payable 
to non-executive directors of 
companies of a similar size 
and complexity.

Reasonable expenses incurred 
in undertaking duties as a 
director are reimbursed.

(cid:49)(cid:70)(cid:83)(cid:71)(cid:80)(cid:83)(cid:78)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:1)
(cid:78)(cid:70)(cid:66)(cid:84)(cid:86)(cid:83)(cid:70)(cid:84)

Not applicable.

The non-executive directors are 
appointed for an initial three-year 
period subject to annual performance 
review and re-election at AGMs, unless 
terminated earlier by either party on 
one month’s written notice. Each of the 
current non-executive directors have 
been appointed within the last three 
years. Appointments will not normally 
continue beyond nine years in ofﬁce.

(cid:34)(cid:81)(cid:81)(cid:83)(cid:80)(cid:66)(cid:68)(cid:73)(cid:1)(cid:85)(cid:80)(cid:1)(cid:83)(cid:70)(cid:68)(cid:83)(cid:86)(cid:74)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)
(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

(cid:52)(cid:70)(cid:83)(cid:87)(cid:74)(cid:68)(cid:70)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:83)(cid:66)(cid:68)(cid:85)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:90)(cid:1)
(cid:80)(cid:79)(cid:1)(cid:81)(cid:66)(cid:90)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:77)(cid:80)(cid:84)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)(cid:80)(cid:71)fice

When agreeing the components 
of remuneration package for the 
appointment of new executive 
directors, the committee will consider 
the remuneration package of the 
existing executive directors to ensure 
a consistent approach. 

For an external hire, base salary will be 
set in line with the factors set out in the 
policy table, taking into account the 
individual’s experience and the amount 
required to attract the individual to join 
the Company. Also to be considered 
are global factors, such as the location 
where the individual will be based, or 
where he or she was previously located. 
The committee may also consider 
paying compensation for the forfeit of 
any award under variable remuneration 
arrangements with a previous employer. 
Relocation will be subject to the 
principles set out in the policy table. 
When an internal appointment is made, 
any pre-existing obligations may be 
honoured and payment will be permitted 
under the policy.

The executive directors’ service 
contracts require 12 months’ notice of 
termination by either party. There are 
no obligations in any executive director’s 
service contract or non-executive 
director’s letter of appointment which 
would require the Company to pay 
a speciﬁc amount of compensation 
for loss of ofﬁce. 

The executive directors’ service 
contracts reﬂect the Company’s policy 
regarding notice periods. No payment 
will be made for a termination by the 
Company for a breach by the executive 
director of his or her service contract. 
In other cases, payment in lieu of notice 
will be considered up to the 12 months’ 
notice period to cover base salary, 
beneﬁts and pension contributions. 
If additional compensation is required 
to be considered, such as on a 
settlement or compromise agreement, 
the committee will consider all relevant 
commercial factors affecting the 
speciﬁc case. 

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78

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Directors’ remuneration report continued

(cid:51)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:90)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

(cid:42)(cid:77)(cid:77)(cid:86)(cid:84)(cid:85)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)(cid:66)(cid:81)(cid:81)(cid:77)(cid:74)(cid:68)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:80)(cid:71)(cid:1)(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:90)

The following bar charts for each executive director set out: ﬁrstly, the minimum remuneration payable in respect of salary, 
beneﬁts and pension; secondly, the remuneration payable if performance is in line with the Company’s expectations; and thirdly, 
the remuneration payable if the maximum bonus is payable for the ﬁnancial year ending 30th June 2015. Beneﬁts are not subject 
to speciﬁed minima or maxima.

1,137

43%

1,299

13%
37%

50%

57%

650

100%

Sir David McMurtry

803

12%
37%

51%

705

42%

58%

D J Deer

411

100%

988

12%
34%

54%

876

39%

61%

B R Taylor

537

100%

809

11%
35%

54%

717

38%

62%

A C G Roberts

442

100%

808

11%
35%

54%

716

38%

62%

G McFarland

441

100%

Minimum remuneration

Bonus for target proﬁt before tax

Additional maximum bonus

(cid:52)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:68)(cid:80)(cid:79)(cid:84)(cid:74)(cid:69)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
(cid:80)(cid:71)(cid:1)(cid:70)(cid:78)(cid:81)(cid:77)(cid:80)(cid:90)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:68)(cid:80)(cid:79)(cid:69)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)
(cid:70)(cid:77)(cid:84)(cid:70)(cid:88)(cid:73)(cid:70)(cid:83)(cid:70)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:40)(cid:83)(cid:80)(cid:86)(cid:81)

The committee takes into account the 
pay and employment conditions of 
the Group in the country in which the 
executive director resides and is satisﬁed 
that the approach taken is fair and 
reasonable based on market conditions 
and practice and the best interests of 
the shareholders. When considering 
the annual salary review, the average 
base salary increase awarded to the 
employees in the relevant country 
provides a guide when determining 
the salaries of the executive directors 
located in that country.

The Company did not consult with 
employees when the remuneration 
policy was drawn up. 

In setting the policy, the committee did 
not undertake extensive remuneration 
comparison measurements but did 
review the remuneration policies of other 
companies whose remuneration reports 
had already been published under the 
revised regulations.

(cid:52)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:68)(cid:80)(cid:79)(cid:84)(cid:74)(cid:69)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
of shar(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:70)(cid:83)(cid:1)(cid:87)(cid:74)(cid:70)(cid:88)(cid:84)

The committee has noted comments 
provided by external shareholders when 
drawing up the remuneration policy. 
At the AGM in 2013, the advisory vote 
on the Directors’ remuneration report 
received proxy votes of 99.61% in favour.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

79

(cid:34)(cid:79)(cid:79)(cid:86)(cid:66)(cid:77)(cid:1)(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:83)(cid:70)(cid:81)(cid:80)(cid:83)(cid:85)

This section of the report sets out the remuneration of the directors in the year ended 30th June 2014.

Single total figur(cid:70)(cid:1)(cid:85)(cid:66)(cid:67)(cid:77)(cid:70)(cid:1)(cid:9)(cid:66)(cid:86)(cid:69)(cid:74)(cid:85)(cid:70)(cid:69)(cid:10)

Sir David McMurtry

D J Deer

B R Taylor

A C G Roberts

G McFarland1

C T Chesney2

D Grant

D J Jeans2

W H Whiteley2

Salary/fees

Beneﬁts

Bonus

Pension

Total

2013
£’000

600

362

418

340

340

28

40

9

40

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:23)(cid:20)(cid:17)

(cid:20)(cid:25)(cid:18)

(cid:21)(cid:20)(cid:25)

(cid:20)(cid:22)(cid:24)

(cid:20)(cid:21)(cid:24)

(cid:21)(cid:19)

(cid:21)(cid:19)

(cid:21)(cid:19)

(cid:18)(cid:19)

2013
£’000

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

2013
£’000

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

2013
£’000

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

2

18

19

19

17

n/a

n/a

n/a

n/a

(cid:19)

(cid:18)(cid:26)

(cid:18)(cid:26)

(cid:18)(cid:26)

(cid:18)(cid:25)

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

61

37

42

34

34

n/a

n/a

n/a

n/a

(cid:17)

(cid:17)

(cid:17)

(cid:17)

(cid:17)

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

n/a

n/a

63

51

55

n/a

n/a

n/a

n/a

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

(cid:23)(cid:23)

(cid:22)(cid:20)

(cid:23)(cid:20)

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

(cid:79)(cid:16)(cid:66)

2013
£’000

663

417

542

444

446

28

40

9

40

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:23)(cid:20)(cid:19)

(cid:21)(cid:17)(cid:17)

(cid:22)(cid:19)(cid:20)

(cid:21)(cid:19)(cid:26)

(cid:21)(cid:19)(cid:25)

(cid:21)(cid:19)

(cid:21)(cid:19)

(cid:21)(cid:19)

(cid:18)(cid:19)

1 Figures for G McFarland reﬂect an element of salary sacriﬁce. 

2  C T Chesney was appointed a director on 19th October 2012, D J Jeans was appointed a director on 11th April 2013 and W H Whiteley retired as a director on 

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17th October 2013.

Benefits

Sir David McMurtry

D J Deer

B R Taylor

A C G Roberts

G McFarland

Car 
allowance
£’000

Private medical cover applies to all  
executive directors and home telephone costs,  
insurance on personal cars, M4 bridge toll fees,  

US tax return advice is provided to certain directors
£’000

n/a

17

17

17

17

2

2

2

2

1

(cid:35)(cid:80)(cid:79)(cid:86)(cid:84)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:81)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)(cid:70)(cid:79)(cid:85)(cid:74)(cid:85)(cid:77)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)

For the year in question, the bonus 
was determined by group performance 
targets for the year, based on an 
adjusted proﬁt before tax set at levels 
above the previous year’s proﬁt before 
tax and with a threshold below which no 
bonus is earned. A target proﬁt before 
tax set for the year in question enabled 
75% of salary to be earned as a bonus. 
A further bonus could be earned based 
on performance subject to a maximum 
100% of salary. No other performance 
measures were set.

G McFarland is a member of the 
Company’s closed deﬁned beneﬁt 
scheme. At 30th June 2014, the value of 
the deﬁned beneﬁt pension entitlement 
was £28,308 per annum. The normal 
retirement age for G McFarland is 65. 
On death, pension beneﬁts would pass 
to dependants. 

Current year pension scheme 
contributions payable by the Company 
have been taken as cash, except for 
part of G McFarland’s entitlement, which 
was paid into the Company’s deﬁned 
contribution scheme. 

The value of G McFarland’s deﬁned 
contribution scheme at 30th June 2014 
was £383,772.

(cid:49)(cid:66)(cid:90)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:85)(cid:80)(cid:1)(cid:81)(cid:66)(cid:84)(cid:85)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)

No payments were made to past 
directors during the year.

(cid:45)(cid:80)(cid:84)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)(cid:80)(cid:71)fice payments

There was no termination of employment 
of directors during the year.

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80

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Directors’ remuneration report continued

(cid:34)(cid:79)(cid:79)(cid:86)(cid:66)(cid:77)(cid:1)(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:83)(cid:70)(cid:81)(cid:80)(cid:83)(cid:85)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

(cid:49)(cid:70)(cid:83)(cid:71)(cid:80)(cid:83)(cid:78)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:72)(cid:83)(cid:66)(cid:81)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:85)(cid:66)(cid:67)(cid:77)(cid:70)

The graph below shows the Company’s total shareholder return (“TSR”) 
performance, compared with the FTSE mid 250 index, which the directors believe is 
the most appropriate broad index for comparison.

The share price and the FTSE mid 250 index have been rebased to 100 at 1st 
July 2009.

Renishaw

FTSE mid 250

800

700

600

500

400

300

200

100

0

2009

2010

2011

2012

2013

2014

(cid:38)(cid:89)(cid:70)(cid:68)(cid:86)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:1)(cid:84)(cid:70)(cid:83)(cid:87)(cid:74)(cid:79)(cid:72)(cid:1)
(cid:66)(cid:84)(cid:1)(cid:79)(cid:80)(cid:79)(cid:14)(cid:70)(cid:89)(cid:70)(cid:68)(cid:86)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:1)
of other companies

(cid:52)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:8)(cid:1)
(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:1)
(cid:74)(cid:79)(cid:85)(cid:70)(cid:83)(cid:70)(cid:84)(cid:85)(cid:84)

G McFarland served as a non-executive 
director of Delcam plc until 7th February 
2014. Neither the Company nor 
G McFarland received any remuneration 
or fees in respect of such directorship.

None of the directors is required to own 
shares in the Company. The interests of 
the directors who have served during 
the year in shares (including connected 
persons) are:

Sir David McMurtry
D J Deer
B R Taylor
A G Roberts
G McFarland
C T Chesney
D Grant
D J Jeans
W H Whiteley

Number of  

ordinary shares of 20p each
26,377,291
12,233,040
10,147
5,165
2,000
500
-
-
6,765

There were no share-based payments 
made or share schemes in place during 
the year.

(cid:36)(cid:73)(cid:74)(cid:70)(cid:71)(cid:1)(cid:38)(cid:89)(cid:70)(cid:68)(cid:86)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)(cid:85)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)
(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

The table below sets out information 
relating to Sir David McMurtry who was 
the Chief Executive for each of the years 
in question:

Single ﬁgure of 
total 
remuneration 
(£‘000)
632
663

Annual bonus 
payout against 
maximum 
opportunity %
0%
10%

Long-term 
incentive 
vesting rates 
against 
maximum 
opportunity %
n/a
n/a

969

1,066
472

69%

100%
0%

n/a

n/a
n/a

Year
2014
2013

2012

2011
2010

(cid:49)(cid:70)(cid:83)(cid:68)(cid:70)(cid:79)(cid:85)(cid:66)(cid:72)(cid:70)(cid:1)(cid:68)(cid:73)(cid:66)(cid:79)(cid:72)(cid:70)(cid:1)(cid:74)(cid:79)(cid:1)
(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:36)(cid:73)(cid:74)(cid:70)(cid:71)(cid:1)
(cid:38)(cid:89)(cid:70)(cid:68)(cid:86)(cid:85)(cid:74)(cid:87)(cid:70)

The following table sets out a 
comparison of the percentage change 
in the Chief Executive’s remuneration 
to the average percentage change in 
remuneration for all UK employees from 
2013 to 2014.

Percentage 
change
in salary

Percentage 
change in 
beneﬁts

Percentage 
change in 
annual 
bonus

+5%

0%

-100%

+4%

+4%

-21%

Chief 
Executive
UK 
employees 
(average)

UK employees have been chosen as a 
comparator group in order to avoid the 
impact of exchange rate movements 
over the year. UK employees make 
up 66% of the total number of 
group employees.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

81

(cid:51)(cid:70)(cid:77)(cid:66)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:78)(cid:81)(cid:80)(cid:83)(cid:85)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)
spend on pay

The following table sets out the total 
amount spent in the current ﬁnancial 
year and the previous year on 
remuneration to all group employees 
and on dividends to shareholders:

Employee 
remuneration
Shareholder 
dividends 
paid

2013
£’000

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

change
% 

137,253 (cid:18)(cid:21)(cid:23)(cid:13)(cid:25)(cid:22)(cid:17)

+7%

28,773

(cid:19)(cid:26)(cid:13)(cid:18)(cid:18)(cid:22)

+1%

Except as shown above, no other 
distributions have been made to 
shareholders or other payments or 
uses of proﬁt or cash ﬂow which impact 
on the understanding of the relative 
importance of spend on pay.

(cid:52)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:74)(cid:78)(cid:81)(cid:77)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
(cid:80)(cid:71)(cid:1)(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:90)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)
(cid:79)(cid:70)(cid:89)(cid:85)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

The executive directors’ salaries will be 
increased by 2.93% in 2015 which is in 
line with the UK workforce salary review. 
The bonus scheme targets have been 
set based on the policy as set out in the 
policy table. 

(cid:36)(cid:80)(cid:79)(cid:84)(cid:74)(cid:69)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:67)(cid:90)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:78)(cid:66)(cid:85)(cid:85)(cid:70)(cid:83)(cid:84)(cid:1)(cid:83)(cid:70)(cid:77)(cid:66)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:85)(cid:80)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:8)(cid:1)
(cid:83)(cid:70)(cid:78)(cid:86)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

During the year, the Remuneration 
committee considered the amount 
of the executive directors’ salary and 
the framework for the annual bonus. 
The members of the Remuneration 
committee for such purpose were:
D Grant (Chair)
C T Chesney
D J Jeans

No other person materially assisted 
the committee in their consideration of 
these matters.

In relation to the consideration of the 
drafting of the directors’ remuneration 
policy and the annual remuneration 
report, the committee, comprising the 
members set out above, were materially 
assisted by the Company Secretary.

(cid:52)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:87)(cid:80)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:85)(cid:1)(cid:72)(cid:70)(cid:79)(cid:70)(cid:83)(cid:66)(cid:77)(cid:1)(cid:78)(cid:70)(cid:70)(cid:85)(cid:74)(cid:79)(cid:72)

At the annual general meeting held on 17th October 2013, votes cast by proxy in 
respect of the directors’ remuneration were as follows:

Resolution
Approval of 
remuneration 
report

Votes for*

% for*

Votes 
against

%  

Total  

against

votes cast

Votes  

withheld

62,032,614

99.6%

246,091

0.4% 62,278,705

14,586

*including Chairman’s discretion

There was no vote on the remuneration 
policy as this year is the ﬁrst year in 
which such a vote is required.

The report was approved by the Board 
of directors and has been signed on 
its behalf by:

The Company deems that a signiﬁcant 
percentage of votes against as being 
more than 20%, as a result of which the 
Company would provide in this report 
any reasons known to it for such a vote 
and any actions taken.

David Grant
Chair of the Remuneration committee
23rd July 2014

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82

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Other statutory and regulatory disclosures

(cid:51)(cid:70)(cid:87)(cid:74)(cid:70)(cid:88)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:67)(cid:86)(cid:84)(cid:74)(cid:79)(cid:70)(cid:84)(cid:84)

(cid:37)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:85)(cid:73)(cid:70)(cid:74)(cid:83)(cid:1)(cid:74)(cid:79)(cid:85)(cid:70)(cid:83)(cid:70)(cid:84)(cid:85)(cid:84)

A review of the business and likely future 
developments is given in the Chairman’s 
statement and the Strategic report. 
Segmental information by geographical 
market is given in note 2 to the 
ﬁnancial statements.

The Group has established and acquired 
overseas manufacturing, marketing and 
distribution subsidiaries to manufacture 
some of the Group’s products and to 
provide support to customers in our 
major markets in the following regions 
outside the UK:

(cid:116)(cid:1) Europe: Germany, France, Italy, Spain, 
Switzerland, The Netherlands, Czech 
Republic, Poland, Russia, Sweden 
and Austria;

(cid:116)(cid:1) Americas: USA, Mexico, Brazil 

and Canada;

(cid:116)(cid:1) Far East: Japan, Hong Kong, 

Australia, South Korea, The People’s 
Republic of China, Singapore and 
Taiwan; and

(cid:116)(cid:1) Other regions: India and Israel.

There are also representative ofﬁces in 
Hungary, Turkey, Malaysia, Indonesia 
and Thailand and an associate 
company, 50%-owned, in Slovenia.

Further information is also available 
on the Company’s website: 
www.renishaw.com.

(cid:37)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)(cid:84)

The directors propose a ﬁnal dividend 
of £21,741,938 or 29.87p per share 
(2013: £20,868,475 or 28.67p per share) 
which, together with the interim dividend 
of £8,246,942 or 11.33p per share 
(2013: £8,246,942 or 11.33p) makes a 
total amount of dividends for the year 
of £29,988,880 or 41.2p per share, 
compared to £29,115,417 or 40p per 
share for the previous year.

The directors at the end of the year are listed below together with their interests in the 
share capital of the Company (with the equivalent number of voting rights), as notiﬁed 
to the Company:-

Ordinary shares of 20p each

Sir David McMurtry

D J Deer

B R Taylor

A C G Roberts

G McFarland

C T Chesney

D Grant

D J Jeans

All the above interests were beneﬁcially 
held with the exception of 2,434,411 
shares (2013: 2,434,411 shares) 
which were non-beneﬁcially held by 
D J Deer but in respect of which he has 
voting rights.

There has been no change in the above 
holdings in the period 1st July 2014 
to 23rd July 2014. In accordance with 
the provisions of the Code all directors 
will retire and, being eligible, offer 
themselves for re-election at the annual 
general meeting (“AGM”) to be held 
on 16th October 2014. Details of the 
directors are shown on pages 60 and 61 
and full biographical details are available 
on www.renishaw.com.

26,377,291

12,233,040 

10,147

5,165

2,000

500

nil

nil

Sir David McMurtry, as one party, and 
D J Deer and Mrs M E Deer, as the other 
party, have entered into an agreement 
relating to the way each party would 
vote in respect of his or her shares 
if requested by the other party to do 
so. Under this agreement Sir David 
McMurtry, John Deer and Mrs Deer 
agree that (i) Mr and Mrs Deer will vote 
their shares in favour of any ordinary 
resolution if requested to do so by 
Sir David McMurtry and (ii) Sir David 
McMurtry will vote his shares against 
any special or extraordinary resolution 
if requested to do so by John Deer. 
The voting arrangement was renewed 
in 2013 for a further period of 5 years 
and will terminate on the earlier of 
25th May 2018 and the deaths of both 
of Sir David McMurtry and John Deer. 

The rules on appointment, 
reappointment and retirement by 
rotation of the directors and their powers 
are set out in the Company’s Articles 
of Association. There are no powers 
given to the directors that are regarded 
as unusual.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

83

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(cid:37)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:8)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:80)(cid:71)ficers’(cid:1)
(cid:74)(cid:79)(cid:69)(cid:70)(cid:78)(cid:79)(cid:74)(cid:85)(cid:90)(cid:1)(cid:74)(cid:79)(cid:84)(cid:86)(cid:83)(cid:66)(cid:79)(cid:68)(cid:70)

(cid:37)(cid:74)(cid:84)(cid:68)(cid:77)(cid:80)(cid:84)(cid:86)(cid:83)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:74)(cid:79)(cid:71)(cid:80)(cid:83)(cid:78)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
to auditor

Subject to the provisions of the 
Companies Act 2006, the Company’s 
Articles of Association provide for the 
directors and ofﬁcers of the Company 
to be appropriately indemniﬁed. 
The Company maintains insurance 
for the directors and ofﬁcers of the 
Company in respect of their acts and 
omissions during the performance of 
their duties.

(cid:52)(cid:73)(cid:66)(cid:83)(cid:70)(cid:1)(cid:68)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)

Details of the Company’s share capital, 
including rights and obligations, is given 
in note 21 to the ﬁnancial statements. 
The Company is not a party to any 
signiﬁcant agreements that might 
terminate upon a change of control 
of the Company. 

A shareholder’s authority for the 
purchase by the Company of a 
maximum of 10% of its own shares was 
in existence during the 2014 ﬁnancial 
year. However, the Company did not 
purchase any of its own shares during 
that time.

(cid:34)(cid:86)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)

A resolution to reappoint KPMG LLP 
as auditor of the Company, will be 
proposed at the forthcoming AGM.

The directors who held ofﬁce at the date 
of approval of this statement conﬁrm 
that, so far as they are each aware, there 
is no relevant audit information of which 
the Company’s auditor is unaware; and 
each director has taken all the steps 
that he or she ought to have taken as a 
director to make himself/herself aware 
of any relevant audit information and to 
establish that the Company’s auditor is 
aware of that information.

(cid:34)(cid:79)(cid:79)(cid:86)(cid:66)(cid:77)(cid:1)(cid:72)(cid:70)(cid:79)(cid:70)(cid:83)(cid:66)(cid:77)(cid:1)(cid:78)(cid:70)(cid:70)(cid:85)(cid:74)(cid:79)(cid:72)

The notice convening the AGM and 
an explanation of the resolutions sought 
are set out in a circular which has been 
sent to the shareholders separately. 
At the meeting, the Company will be 
seeking shareholder approval for, 
amongst other things, the ability to 
make market purchases of its own 
ordinary shares, up to a total of 10% 
of the issued share capital.

The directors consider that all the 
resolutions proposed are in the 
best interests of the Company 
and its shareholders as a whole 
and unanimously recommend that 
shareholders vote in favour of the 
resolutions, as they intend to do 
in respect of their own holdings.

 
 
 
84

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Other statutory and regulatory disclosures continued

(cid:52)(cid:86)(cid:67)(cid:84)(cid:85)(cid:66)(cid:79)(cid:85)(cid:74)(cid:66)(cid:77)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:74)(cid:79)(cid:72)(cid:84)

(cid:37)(cid:80)(cid:79)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)

Apart from the shareholdings (and corresponding voting rights) of Sir David 
McMurtry and John Deer (36.2% and 16.8% respectively), the following voting 
rights have been notiﬁed to the directors under the requirements of the UK Listing 
Authority’s Disclosure Rules and Transparency Rules DTR 5, which represent 
3% or more of the voting rights attached to issued shares in the Company, as at 
30th June 2014: 

Baillie Gifford & Co

BlackRock Inc

Capital Research and Management Company 

Standard Life Investments Limited

% of issued 
share capital

Number of 
shares

5.25%

4.92%

4.76%

4.99%

3,846,993

3,578,133

3,465,730

3,631,612

No notiﬁcations have been received under the provisions of DTR 5 in the period 
1st July 2014 to 23rd July 2014.

(cid:51)(cid:70)(cid:84)(cid:70)(cid:66)(cid:83)(cid:68)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)

The Group has a continuing 
commitment to a high level of research 
and development. The expenditure 
involved is directed towards the 
research and development of new 
products relating to metrology, 
including computer aided design and 
manufacturing systems, and relating to 
healthcare products, including Raman 
spectroscopy systems, dental systems 
and certain areas in the medical 
devices ﬁeld. Further information on 
the expenditure on research and 
development is contained in the ﬁnancial 
review section of the Strategic report.

(cid:38)(cid:78)(cid:81)(cid:77)(cid:80)(cid:90)(cid:70)(cid:70)(cid:84)

The maintenance of a highly-skilled 
workforce is essential to the future of 
the business and the directors place 
great emphasis on the continuation 
of the Company’s approved training 
policy. Health and safety matters are 
given special attention by the directors 
and well established systems of safety 
management are in place throughout 
the Group to safeguard employees, 
customers and visitors.

Employment policies are designed 
to provide equal opportunities 
irrespective of race, colour, religion, 
sex, age, disability or sexual orientation. 
Proper consideration is given to 
applications for employment from 
disabled people who are employed 
where suitable for appropriate 
vacancies. Employees who become 
disabled whilst with the Company 
will be given every opportunity to 
continue their employment through 
reasonable adjustment to their working 
conditions, equipment, or where this 
is not possible, re-training for other 
positions. They will also be afforded 
opportunities to continue training and 
gain promotion on the same basis as 
any other employee.

Details on information provided to staff 
on the performance of the business, 
consultation with employees and 
performance incentives are contained 
in the description of corporate social 
responsibility activities set out on 
pages 48 and 49.

There are no agreements with 
employees providing for compensation 
for any loss of employment that occurs 
because of a takeover bid.

No political donations were made during 
the year (2013 £nil).

(cid:36)(cid:80)(cid:79)(cid:85)(cid:83)(cid:80)(cid:77)(cid:77)(cid:74)(cid:79)(cid:72)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:70)(cid:83)(cid:84)(cid:8)(cid:1)
(cid:66)(cid:83)(cid:83)(cid:66)(cid:79)(cid:72)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)

In May 2014 the Listing Rules (Listing 
Regime Enhancements) Instrument 
2014 came into effect. The revised rules 
require that premium listed companies 
with “controlling shareholders” (deﬁned 
as a shareholder who individually or with 
any of their concert parties exercises 
or controls 30% or more of the votes 
able to be cast on all or substantially all 
the matters at the Company’s general 
meeting) must enter into a relationship 
agreement containing independence 
provisions. Transitional arrangements 
provide that the Company has until  
16th November 2014 in order to 
implement the relationship agreement 
and therefore the Company is in 
the process of putting in place an 
appropriate agreement.

(cid:40)(cid:83)(cid:70)(cid:70)(cid:79)(cid:73)(cid:80)(cid:86)(cid:84)(cid:70)(cid:1)(cid:72)(cid:66)(cid:84)(cid:1)(cid:70)(cid:78)(cid:74)(cid:84)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)

The disclosures concerning greenhouse 
gas emissions required by law are set 
out in the Corporate social responsibility 
report on pages 54 and 55.

Signed on behalf of the Board

Norma Tang
Company Secretary
23rd July 2014
Renishaw plc
Registered number 1106260, England 
and Wales

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

85

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 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. 

(cid:37)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:80)(cid:83)(cid:84)(cid:8)(cid:1)(cid:83)(cid:70)(cid:84)(cid:81)(cid:80)(cid:79)(cid:84)(cid:74)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:90)(cid:1)
(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)

We conﬁrm that to the best of 
our knowledge:

(cid:116)(cid:1) the ﬁnancial statements, prepared in 
accordance with the applicable set 
of accounting standards, give a true 
and fair view of the assets, liabilities, 
ﬁnancial position and proﬁt or loss of 
the Company and the undertakings 
included in the consolidation taken as 
a whole; and

(cid:116)(cid:1) the Strategic report includes a fair 
review of the development and 
performance of the business and 
the position of the Company and 
the undertakings included in the 
consolidation taken as a whole, 
together with a description of the 
principal risks and uncertainties that 
they face.

Signed on behalf of the Board

Allen Roberts
Group Finance Director
23rd July 2014

Directors’ responsibilities

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 IFRSs as adopted by the EU and 
applicable law and have elected to 
prepare the parent company ﬁnancial 
statements in accordance with UK 
Accounting Standards. 

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: 

(cid:116)(cid:1) select suitable accounting policies 
and then apply them consistently; 

(cid:116)(cid:1) make judgements and estimates that 

are reasonable and prudent; 

(cid:116)(cid:1) for the group ﬁnancial statements, 
state whether they have been 
prepared in accordance with IFRSs 
as adopted by the EU; 

(cid:116)(cid:1) 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; and 

(cid:116)(cid:1) prepare the ﬁnancial statements on 
the going concern basis unless it is 
inappropriate to presume that the 
group and the parent company will 
continue in business. 

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86

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Independent auditor’s report to the members of Renishaw plc

We challenged the Group’s selection of 
the discount rates used by considering 
the assumptions underlying the 
calculation of each discount rate; using 
external data (including competitor 
analysis) to determine an appropriate 
range for each type of business and 
comparing the actual rate used to 
that range. For the period beyond 
the ﬁnancial budgets and forecasts, 
we assessed whether the growth 
rate used was consistent with both 
historical performance and future 
business strategies. 

We evaluated the Group’s sensitivity 
analysis, by performing our own 
analysis to assess the sensitivity of the 
impairment reviews to changes in the 
key assumptions of the discount rate, 
the forecast cash ﬂows and growth rate 
beyond the ﬁnancial budgets.

We assessed the adequacy of the 
Group’s disclosures in respect of the 
impairment testing of goodwill and 
whether disclosures about the sensitivity 
of the outcome of the impairment 
assessment to changes in key 
assumptions properly reﬂected the risks 
inherent in it.

(cid:48)(cid:81)(cid:74)(cid:79)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:80)(cid:79)(cid:68)(cid:77)(cid:86)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)
(cid:66)(cid:83)(cid:74)(cid:84)(cid:74)(cid:79)(cid:72)(cid:1)(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:80)(cid:86)(cid:83)(cid:1)(cid:66)(cid:86)(cid:69)(cid:74)(cid:85)

(cid:18)(cid:15)(cid:1)(cid:48)(cid:86)(cid:83)(cid:1)(cid:80)(cid:81)(cid:74)(cid:79)(cid:74)(cid:80)(cid:79)(cid:1)(cid:80)(cid:79)(cid:1)(cid:85)(cid:73)e fi(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)
(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:74)(cid:84)(cid:1)(cid:86)(cid:79)(cid:78)(cid:80)(cid:69)ifie(cid:69)
We have audited the ﬁnancial statements 
of Renishaw plc for the year ended 
30th June 2014 set out on pages  
89 to 126. In our opinion: 

(cid:116)(cid:1) 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 30th June 2014 and of the 
Group’s proﬁt for the year then ended; 

(cid:116)(cid:1) the group ﬁnancial statements have 

been properly prepared in accordance 
with International Financial Reporting 
Standards as adopted by the 
European Union (IFRSs as adopted by 
the EU); 

(cid:116)(cid:1) the parent company ﬁnancial 

statements have been properly 
prepared in accordance with UK 
Accounting Standards; and 

(cid:116)(cid:1) the ﬁnancial statements have been 
prepared in accordance with the 
requirements of the Companies Act 
2006 and, as regards the group 
ﬁnancial statements, Article 4 of the 
IAS Regulation. 

(cid:19)(cid:15)(cid:1)(cid:48)(cid:86)(cid:83)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:84)(cid:84)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:83)(cid:74)(cid:84)(cid:76)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:78)(cid:66)(cid:85)(cid:70)(cid:83)(cid:74)(cid:66)(cid:77)(cid:1)(cid:78)(cid:74)(cid:84)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)
In arriving at our audit opinion above 
on the ﬁnancial statements, the risks 
of material misstatement that had 
the greatest effect on our audit were 
as follows. 

i) Carrying value of goodwill (£19.7m)

Refer to page 72 (Audit committee 
report), page 97 (accounting 
policy) and pages 104 and 105 
(ﬁnancial disclosures).

The risk – Goodwill acquired in a 
business combination is allocated 
to the Group’s Cash Generating 
Units (“CGUs”), which are aligned 
with the statutory entities acquired. 
The recoverable amounts of the CGUs 
are determined from value in use 
calculations and where the carrying 
value of a CGU exceeds its recoverable 
amount an impairment charge is 
required. The Group has engaged in 
a number of business combinations in 
recent years; a number of acquisitions 
are still in the research and development 
phase and have not yet started trading; 
this makes forecasting inherently 
more judgemental.

Adverse changes in assumptions, 
particularly relating to forecast cash 
ﬂows and discount rates, could reduce 
the recoverable amount below the 
carrying amount, and give rise to an 
impairment charge. The forecasting 
of cash ﬂows and the selection of an 
appropriate discount rate are therefore 
key judgemental areas that our audit is 
concentrated on.

Our response – In this area our audit 
procedures included, among others, 
evaluating the Group’s budgeting 
procedures upon which the forecast 
cash ﬂows are based by performing 
an assessment of the historical 
accuracy of budgets for trading 
entities by comparing previously 
budgeted ﬁgures to actual results. 
We also critically assessed the 
ongoing forecasts for companies in the 
research and development phase, by 
considering the assumptions adopted 
by the directors when preparing the 
forecasts for these entities and taking 
into account the experience of the 
Group at maturing past research and 
development companies into proﬁtable 
trading entities.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

87

Detailed audit instructions were sent 
to all the auditors in these locations. 
These instructions covered the 
signiﬁcant audit areas that should 
be covered by these audits (which 
included the relevant risks of material 
misstatement detailed above) and 
set out the information required to be 
reported back to the group audit team. 
Telephone meetings were also held with 
the auditors at all locations.

(cid:21)(cid:15)(cid:1)(cid:48)(cid:86)(cid:83)(cid:1)(cid:80)(cid:81)(cid:74)(cid:79)(cid:74)(cid:80)(cid:79)(cid:1)(cid:80)(cid:79)(cid:1)(cid:80)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:78)(cid:66)(cid:85)(cid:85)(cid:70)(cid:83)(cid:84)(cid:1)
(cid:81)(cid:83)(cid:70)(cid:84)(cid:68)(cid:83)(cid:74)(cid:67)(cid:70)(cid:69)(cid:1)(cid:67)(cid:90)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:36)(cid:80)(cid:78)(cid:81)(cid:66)(cid:79)(cid:74)(cid:70)(cid:84)(cid:1)(cid:34)(cid:68)(cid:85)(cid:1)
(cid:19)(cid:17)(cid:17)(cid:23)(cid:1)(cid:74)(cid:84)(cid:1)(cid:86)(cid:79)(cid:78)(cid:80)(cid:69)ifie(cid:69)
In our opinion: 

(cid:116)(cid:1) the part of the Directors’ remuneration 

report to be audited has been 
properly prepared in accordance with 
the Companies Act 2006; 

(cid:116)(cid:1) the information given in the Strategic 

report and the directors’ report for the 
ﬁnancial year for which the ﬁnancial 
statements are prepared is consistent 
with the ﬁnancial statements; and

(cid:116)(cid:1) the information given in the Directors’ 

corporate governance report 
set out on pages 67 and 68 with 
respect to internal control and risk 
management systems in relation to 
ﬁnancial reporting processes and 
on page 83 about share capital 
structure is consistent with the 
ﬁnancial statements. 

ii)  Carrying value of work in progress 

(£15.3m) and ﬁnished goods (£24.8m)

Refer to page 72 (Audit committee 
report), page 99 (accounting policy) and 
page 110 (ﬁnancial disclosures).

The risk – There are signiﬁcant inventory 
holdings throughout the Group; in the 
key manufacturing centres in the UK, 
Ireland and India and sales ofﬁces 
around the world. Due to the fast paced 
nature of the industry there is a risk of 
product obsolescence.

The Group maintains an inventory 
provision for potential product 
obsolescence to the extent that 
the cost of inventory is not deemed 
to be recoverable through future 
sales. This provision is calculated 
at a disaggregated level based on 
the historic and future forecast sales 
patterns of individual stock items. 
These assumptions are judgemental and 
changes could have a material impact 
on the calculation of the provision.

Our response – In this area our audit 
procedures included, among others, 
critically assessing the adequacy of the 
Group’s provisions against inventory 
by identifying slow moving line items, 
considering whether these items should 
be provided for by comparison to the 
most recent sales invoices for those 
items. We also challenged the Group’s 
assumptions in respect of the provision 
calculation by assessing historical 
accuracy of the inventory provision.

We also assessed the adequacy of the 
Group’s disclosures in respect of the 
inventory provision.

(cid:20)(cid:15)(cid:1)(cid:48)(cid:86)(cid:83)(cid:1)(cid:66)(cid:81)(cid:81)(cid:77)(cid:74)(cid:68)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:80)(cid:71)(cid:1)(cid:78)(cid:66)(cid:85)(cid:70)(cid:83)(cid:74)(cid:66)(cid:77)(cid:74)(cid:85)(cid:90)(cid:1)
(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:79)(cid:1)(cid:80)(cid:87)(cid:70)(cid:83)(cid:87)(cid:74)(cid:70)(cid:88)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:84)(cid:68)(cid:80)(cid:81)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:80)(cid:86)(cid:83)(cid:1)(cid:66)(cid:86)(cid:69)(cid:74)(cid:85)
The materiality for the ﬁnancial 
statements as a whole was set at 
£5.0m. This has been determined 
with reference to a benchmark of total 
revenue, which we consider to be 
one of the principal considerations for 
members of the Company in assessing 
the ﬁnancial performance of the Group. 
Materiality represents 1.4% of group 
revenue and 5.2% of group proﬁt 
before tax.

We agreed with the Audit committee to 
report to it all corrected and uncorrected 
misstatements we identiﬁed through 
our audit with a value in excess of 
£0.2m, in addition to other audit 
misstatements below that threshold 
that we believe warranted reporting on 
qualitative grounds.

Audits for group reporting purposes 
were performed by component auditors 
at the key reporting components in the 
following countries: Ireland, Hong Kong, 
Germany and Japan and by the group 
audit team in the following countries: the 
UK and the USA. In addition, speciﬁed 
audit procedures were performed 
by component auditors in China. 
These group procedures covered 97% 
of total group revenue; 96% of group 
proﬁt before taxation; and 96% of total 
group assets. The segment disclosures 
in note 2 to the ﬁnancial statements 
set out the individual signiﬁcance of 
speciﬁc regions. 

The audits undertaken for group 
reporting purposes at the key reporting 
components of the Group were all 
performed to materiality levels set 
by, or agreed with, the group audit 
team. These materiality levels were set 
individually for each component and 
ranged from £0.1m to £3.0m. 

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88

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Governance

Independent auditor’s report to the members of Renishaw plc continued

(cid:22)(cid:15)(cid:1)(cid:56)(cid:70)(cid:1)(cid:73)(cid:66)(cid:87)(cid:70)(cid:1)(cid:79)(cid:80)(cid:85)(cid:73)(cid:74)(cid:79)(cid:72)(cid:1)(cid:85)(cid:80)(cid:1)(cid:83)(cid:70)(cid:81)(cid:80)(cid:83)(cid:85)(cid:1)(cid:74)(cid:79)(cid:1)
(cid:83)(cid:70)(cid:84)(cid:81)(cid:70)(cid:68)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:78)(cid:66)(cid:85)(cid:85)(cid:70)(cid:83)(cid:84)(cid:1)(cid:80)(cid:79)(cid:1)(cid:88)(cid:73)(cid:74)(cid:68)(cid:73)(cid:1)(cid:88)(cid:70)(cid:1)
(cid:66)(cid:83)(cid:70)(cid:1)(cid:83)(cid:70)(cid:82)(cid:86)(cid:74)(cid:83)(cid:70)(cid:69)(cid:1)(cid:85)(cid:80)(cid:1)(cid:83)(cid:70)(cid:81)(cid:80)(cid:83)(cid:85)(cid:1)(cid:67)(cid:90)(cid:1)(cid:70)(cid:89)(cid:68)(cid:70)(cid:81)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)
Under ISAs (UK and Ireland) we are 
required to report to you if, based on 
the knowledge we acquired during 
our audit, we have identiﬁed other 
information in the Annual report that 
contains a material inconsistency with 
either that knowledge or the ﬁnancial 
statements, a material misstatement 
of fact, or that is otherwise misleading. 

In particular, we are required to report 
to you if: 

(cid:116)(cid:1) we have identiﬁed material 

inconsistencies between the 
knowledge we acquired during our 
audit and 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 
performance, business model and 
strategy; or

(cid:116)(cid:1) the Audit committee report does 

not appropriately address matters 
communicated by us to the 
Audit committee.

Under the Companies Act 2006, 
we are required to report to you if, 
in our opinion: 

(cid:116)(cid:1) 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 

(cid:116)(cid:1) 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 

(cid:116)(cid:1) certain disclosures of directors’ 

remuneration speciﬁed by law are not 
made; or 

(cid:116)(cid:1) we have not received all the 

information and explanations we 
require for our audit; or 

(cid:116)(cid:1) a corporate governance statement 

has not been prepared by 
the Company.

Under the Listing Rules we are required 
to review: 

(cid:116)(cid:1) the directors’ statement, set out on 

page 67, in relation to going concern; 
and

(cid:116)(cid:1) the part of the corporate governance 
statement on page 69 relating to the 
Company’s compliance with the nine 
provisions of the 2010 UK Corporate 
Governance Code speciﬁed for 
our review.

We have nothing to report in respect 
of the above responsibilities.

(cid:52)(cid:68)(cid:80)(cid:81)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:83)(cid:70)(cid:81)(cid:80)(cid:83)(cid:85)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)
(cid:83)(cid:70)(cid:84)(cid:81)(cid:80)(cid:79)(cid:84)(cid:74)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

As explained more fully in Directors’ 
responsibilities set out on page 85, 
the directors are responsible for the 
preparation of the ﬁnancial statements 
and for being satisﬁed that they give a 
true and fair view. A description of the 
scope of an audit of ﬁnancial statements 
is provided on the Financial Reporting 
Council’s website at www.frc.org.uk/
auditscopeukprivate. This report is 
made solely to the Company’s members 
as a body and is subject to important 
explanations and disclaimers regarding 
our responsibilities, published on 
our website at www.kpmg.com/uk/
auditscopeukco2013a, which are 
incorporated into this report as if set out 
in full and should be read to provide an 
understanding of the purpose of this 
report, the work we have undertaken 
and the basis of our opinions.

Virginia Stevens 
(Senior Statutory Auditor) 
for and on behalf of KPMG LLP, 
Statutory Auditor 
Chartered Accountants 
100 Temple Street 
Bristol 
BS1 6AG
23rd July 2014

Financial statements

Consolidated income statement 

at 30th June 2014

(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:74)(cid:79)(cid:72)(cid:1)(cid:80)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)

(cid:51)(cid:70)(cid:87)(cid:70)(cid:79)(cid:86)(cid:70)

Cost of sales

(cid:40)(cid:83)(cid:80)(cid:84)(cid:84)(cid:1)(cid:81)(cid:83)(cid:80)ﬁ(cid:85)

Distribution costs

Administrative expenses

(cid:48)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:83)(cid:80)ﬁ(cid:85)

Exceptional items

Financial income

Financial expenses

Share of proﬁts of associates less related amortisation

(cid:49)(cid:83)(cid:80)ﬁ(cid:85)(cid:1)(cid:67)(cid:70)(cid:71)(cid:80)(cid:83)(cid:70)(cid:1)(cid:85)(cid:66)(cid:89)

Income tax expense

(cid:49)(cid:83)(cid:80)ﬁ(cid:85)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)(cid:1)(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:74)(cid:79)(cid:72)(cid:1)(cid:80)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)

(cid:49)(cid:83)(cid:80)ﬁ(cid:85)(cid:1)(cid:66)(cid:85)(cid:85)(cid:83)(cid:74)(cid:67)(cid:86)(cid:85)(cid:66)(cid:67)(cid:77)(cid:70)(cid:1)(cid:85)(cid:80)(cid:27)

Equity shareholders of the parent company

Non-controlling interest
(cid:49)(cid:83)(cid:80)ﬁ(cid:85)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)(cid:1)(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:74)(cid:79)(cid:72)(cid:1)(cid:80)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)

(cid:37)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)(cid:1)(cid:81)(cid:70)(cid:83)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:1)(cid:66)(cid:83)(cid:74)(cid:84)(cid:74)(cid:79)(cid:72)(cid:1)(cid:74)(cid:79)(cid:1)(cid:83)(cid:70)(cid:84)(cid:81)(cid:70)(cid:68)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

(cid:37)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)(cid:1)(cid:81)(cid:70)(cid:83)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:1)(cid:81)(cid:66)(cid:74)(cid:69)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

(cid:38)(cid:66)(cid:83)(cid:79)(cid:74)(cid:79)(cid:72)(cid:84)(cid:1)(cid:81)(cid:70)(cid:83)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:1)(cid:9)(cid:67)(cid:66)(cid:84)(cid:74)(cid:68)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:69)(cid:74)(cid:77)(cid:86)(cid:85)(cid:70)(cid:69)(cid:10)(cid:1)

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

89

Notes

2

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

Restated 
2013
£’000

(cid:20)(cid:22)(cid:22)(cid:13)(cid:21)(cid:26)(cid:25)

346,881

(cid:9)(cid:18)(cid:24)(cid:25)(cid:13)(cid:22)(cid:22)(cid:20)(cid:10)

(164,704)

(cid:18)(cid:24)(cid:23)(cid:13)(cid:26)(cid:21)(cid:22)

182,177

(cid:9)(cid:24)(cid:22)(cid:13)(cid:20)(cid:23)(cid:24)(cid:10)

(cid:9)(cid:20)(cid:18)(cid:13)(cid:18)(cid:26)(cid:17)(cid:10)

(69,386)

(33,720)

(cid:24)(cid:17)(cid:13)(cid:20)(cid:25)(cid:25)

79,071

(cid:19)(cid:23)(cid:13)(cid:19)(cid:25)(cid:17)

2,903

(cid:23)(cid:24)(cid:26)

(cid:9)(cid:18)(cid:13)(cid:24)(cid:20)(cid:23)(cid:10)

(cid:24)(cid:24)(cid:22)

1,009 

(1,909)

1,022

(cid:26)(cid:23)(cid:13)(cid:20)(cid:25)(cid:23)

82,096

(cid:9)(cid:18)(cid:17)(cid:13)(cid:24)(cid:19)(cid:17)(cid:10)

(15,046)

(cid:25)(cid:22)(cid:13)(cid:23)(cid:23)(cid:23)

67,050

(cid:25)(cid:23)(cid:13)(cid:19)(cid:18)(cid:22)

(cid:9)(cid:22)(cid:21)(cid:26)(cid:10)

(cid:25)(cid:22)(cid:13)(cid:23)(cid:23)(cid:23)

67,643

(593)

67,050

(cid:81)(cid:70)(cid:79)(cid:68)(cid:70)

(cid:21)(cid:18)(cid:15)(cid:19)

(cid:21)(cid:17)(cid:15)(cid:17)

(cid:18)(cid:18)(cid:25)(cid:15)(cid:21)

pence

40.0

39.5

92.9

4

5

5

11

6

7

21

21

8

S
t
r
a
t
e
g
c

i

r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e

i

F
n
a
n
c
a

i

l

s
t
a
t
e
m
e
n
t
s

S
h
a
r
e
h
o
d
e
r

l

i

f

n
o
r
m
a
t
i
o
n

 
 
 
90

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Consolidated balance sheet

at 30th June 2014

(cid:34)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)
Property, plant and equipment
Intangible assets
Investments in associates
Deferred tax assets
Derivatives
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:79)(cid:80)(cid:79)(cid:14)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)
Inventories
Trade receivables
Current tax
Other receivables
Derivatives
Pension scheme cash escrow account
Cash and cash equivalents
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)
Trade payables
Current tax
Provisions
Derivatives
Other payables
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

(cid:47)(cid:70)(cid:85)(cid:1)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)

(cid:47)(cid:80)(cid:79)(cid:14)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)
Employee beneﬁts
Deferred tax liabilities
Derivatives
Other payables
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:79)(cid:80)(cid:79)(cid:14)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:77)(cid:70)(cid:84)(cid:84)(cid:1)(cid:85)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

(cid:38)(cid:82)(cid:86)(cid:74)(cid:85)(cid:90)
Share capital
Share premium
Currency translation reserve
Cash ﬂow hedging reserve
Retained earnings
Other reserve
(cid:38)(cid:82)(cid:86)(cid:74)(cid:85)(cid:90)(cid:1)(cid:66)(cid:85)(cid:85)(cid:83)(cid:74)(cid:67)(cid:86)(cid:85)(cid:66)(cid:67)(cid:77)(cid:70)(cid:1)(cid:85)(cid:80)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:70)(cid:83)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:81)(cid:66)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:66)(cid:79)(cid:90)
Non-controlling interest
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:70)(cid:82)(cid:86)(cid:74)(cid:85)(cid:90)

Notes

9
10
11
13
14

16
22

14
15
17, 22

18
14
19

15
13
14
20

21

21
21

21

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:21)(cid:17)(cid:13)(cid:26)(cid:19)(cid:19)
(cid:22)(cid:23)(cid:13)(cid:22)(cid:24)(cid:18)
(cid:19)(cid:13)(cid:19)(cid:20)(cid:17)
(cid:18)(cid:23)(cid:13)(cid:18)(cid:24)(cid:20)
(cid:18)(cid:25)(cid:13)(cid:23)(cid:21)(cid:21)
(cid:19)(cid:20)(cid:21)(cid:13)(cid:22)(cid:21)(cid:17)

(cid:23)(cid:19)(cid:13)(cid:26)(cid:24)(cid:26)
(cid:25)(cid:18)(cid:13)(cid:24)(cid:26)(cid:25)
(cid:18)(cid:13)(cid:23)(cid:26)(cid:17)
(cid:18)(cid:17)(cid:13)(cid:25)(cid:21)(cid:24)
(cid:18)(cid:20)(cid:13)(cid:20)(cid:21)(cid:25)
(cid:26)(cid:13)(cid:22)(cid:21)(cid:18)
(cid:21)(cid:20)(cid:13)(cid:23)(cid:20)(cid:21)
(cid:19)(cid:19)(cid:20)(cid:13)(cid:25)(cid:20)(cid:24)

(cid:18)(cid:25)(cid:13)(cid:25)(cid:22)(cid:24)
(cid:20)(cid:13)(cid:26)(cid:21)(cid:18)
(cid:18)(cid:13)(cid:19)(cid:26)(cid:21)
(cid:111)
(cid:18)(cid:23)(cid:13)(cid:18)(cid:18)(cid:17)
(cid:21)(cid:17)(cid:13)(cid:19)(cid:17)(cid:19)

2013
£’000

117,926
56,143
7,403
18,276
7,976
207,724

65,268
68,082
1,160
10,871
3,583
10,982
26,605
186,551

18,481
2,629
1,630
2,018
19,017
43,775

(cid:18)(cid:25)(cid:20)(cid:13)(cid:23)(cid:20)(cid:22)

142,776

(cid:21)(cid:20)(cid:13)(cid:17)(cid:23)(cid:25)
(cid:19)(cid:20)(cid:13)(cid:21)(cid:21)(cid:21)
(cid:18)(cid:24)
(cid:25)(cid:25)(cid:20)
(cid:23)(cid:24)(cid:13)(cid:21)(cid:18)(cid:19)

41,718
20,032
10,442
1,589
73,781

(cid:20)(cid:22)(cid:17)(cid:13)(cid:24)(cid:23)(cid:20)

276,719

(cid:18)(cid:21)(cid:13)(cid:22)(cid:22)(cid:25)
(cid:21)(cid:19)
(cid:9)(cid:19)(cid:13)(cid:25)(cid:19)(cid:22)(cid:10)
(cid:19)(cid:22)(cid:13)(cid:22)(cid:25)(cid:17)
(cid:20)(cid:18)(cid:22)(cid:13)(cid:26)(cid:21)(cid:21)
(cid:9)(cid:21)(cid:23)(cid:17)(cid:10)
(cid:20)(cid:22)(cid:19)(cid:13)(cid:25)(cid:20)(cid:26)
(cid:9)(cid:19)(cid:13)(cid:17)(cid:24)(cid:23)(cid:10)
(cid:20)(cid:22)(cid:17)(cid:13)(cid:24)(cid:23)(cid:20)

14,558
42
2,929
(694)
261,607
(389)
278,053
(1,334)
276,719

These ﬁnancial statements were approved by the Board of directors on 23rd July 2014 and were signed on its behalf by:

(cid:52)(cid:74)(cid:83)(cid:1)(cid:37)(cid:66)(cid:87)(cid:74)(cid:69)(cid:1)(cid:51)(cid:1)(cid:46)(cid:68)(cid:46)(cid:86)(cid:83)(cid:85)(cid:83)(cid:90)(cid:1)

(cid:34)(cid:1)(cid:36)(cid:1)(cid:40)(cid:1)(cid:51)(cid:80)(cid:67)(cid:70)(cid:83)(cid:85)(cid:84)

Directors

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

91

Consolidated statement of comprehensive income and expense

for the year ended 30th June 2014

(cid:49)(cid:83)(cid:80)ﬁ(cid:85)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

(cid:48)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:74)(cid:85)(cid:70)(cid:78)(cid:84)(cid:1)(cid:83)(cid:70)(cid:68)(cid:80)(cid:72)(cid:79)(cid:74)(cid:84)(cid:70)(cid:69)(cid:1)(cid:69)(cid:74)(cid:83)(cid:70)(cid:68)(cid:85)(cid:77)(cid:90)(cid:1)(cid:74)(cid:79)(cid:1)(cid:70)(cid:82)(cid:86)(cid:74)(cid:85)(cid:90)(cid:27)

(cid:42)(cid:85)(cid:70)(cid:78)(cid:84)(cid:1)(cid:85)(cid:73)(cid:66)(cid:85)(cid:1)(cid:88)(cid:74)(cid:77)(cid:77)(cid:1)(cid:79)(cid:80)(cid:85)(cid:1)(cid:67)(cid:70)(cid:1)(cid:83)(cid:70)(cid:68)(cid:77)(cid:66)(cid:84)(cid:84)(cid:74)ﬁ(cid:70)(cid:69)(cid:1)(cid:85)(cid:80)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:36)(cid:80)(cid:79)(cid:84)(cid:80)(cid:77)(cid:74)(cid:69)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:27)

Foreign exchange translation differences

Remeasurement of deﬁned beneﬁt liabilities

Deferred tax on items that will not be reclassiﬁed

Relating to associates, net of tax
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:74)(cid:85)(cid:70)(cid:78)(cid:84)(cid:1)(cid:85)(cid:73)(cid:66)(cid:85)(cid:1)(cid:88)(cid:74)(cid:77)(cid:77)(cid:1)(cid:79)(cid:80)(cid:85)(cid:1)(cid:67)(cid:70)(cid:1)(cid:83)(cid:70)(cid:68)(cid:77)(cid:66)(cid:84)(cid:84)(cid:74)ﬁ(cid:70)(cid:69)

(cid:42)(cid:85)(cid:70)(cid:78)(cid:84)(cid:1)(cid:85)(cid:73)(cid:66)(cid:85)(cid:1)(cid:78)(cid:66)(cid:90)(cid:1)(cid:67)(cid:70)(cid:1)(cid:83)(cid:70)(cid:68)(cid:77)(cid:66)(cid:84)(cid:84)(cid:74)ﬁ(cid:70)(cid:69)(cid:1)(cid:85)(cid:80)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:36)(cid:80)(cid:79)(cid:84)(cid:80)(cid:77)(cid:74)(cid:69)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:27)

Effective portion of changes in fair value of cash ﬂow hedges, net of recycling

Deferred tax on items that may be reclassiﬁed
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:74)(cid:85)(cid:70)(cid:78)(cid:84)(cid:1)(cid:85)(cid:73)(cid:66)(cid:85)(cid:1)(cid:78)(cid:66)(cid:90)(cid:1)(cid:67)(cid:70)(cid:1)(cid:83)(cid:70)(cid:68)(cid:77)(cid:66)(cid:84)(cid:84)(cid:74)ﬁ(cid:70)(cid:69)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:80)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)(cid:13)(cid:1)(cid:79)(cid:70)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:66)(cid:89)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

(cid:34)(cid:85)(cid:85)(cid:83)(cid:74)(cid:67)(cid:86)(cid:85)(cid:66)(cid:67)(cid:77)(cid:70)(cid:1)(cid:85)(cid:80)(cid:27)

Equity shareholders of the parent company

Non-controlling interest

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

Notes

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:25)(cid:22)(cid:13)(cid:23)(cid:23)(cid:23)

Restated
2013
£’000

67,050

15

21

21

(cid:9)(cid:22)(cid:13)(cid:24)(cid:22)(cid:21)(cid:10)

(cid:9)(cid:19)(cid:13)(cid:19)(cid:20)(cid:20)(cid:10)

(cid:9)(cid:22)(cid:20)(cid:17)(cid:10)

(cid:111)

(cid:9)(cid:25)(cid:13)(cid:22)(cid:18)(cid:24)(cid:10)

(cid:20)(cid:19)(cid:13)(cid:25)(cid:24)(cid:23)

(cid:9)(cid:23)(cid:13)(cid:23)(cid:17)(cid:19)(cid:10)

(cid:19)(cid:23)(cid:13)(cid:19)(cid:24)(cid:21)

346

(860)

(121)

(102)

(737)

(4,225)

1,005

(3,220)

(cid:18)(cid:24)(cid:13)(cid:24)(cid:22)(cid:24)

(3,957)

(cid:18)(cid:17)(cid:20)(cid:13)(cid:21)(cid:19)(cid:20)

63,093

(cid:18)(cid:17)(cid:20)(cid:13)(cid:26)(cid:24)(cid:19)

(cid:9)(cid:22)(cid:21)(cid:26)(cid:10)

(cid:18)(cid:17)(cid:20)(cid:13)(cid:21)(cid:19)(cid:20)

63,686

(593)

63,093

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92

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Consolidated statement of changes in equity

for the year ended 30th June 2014

(cid:52)(cid:73)(cid:66)(cid:83)(cid:70)(cid:1)
(cid:68)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

14,558

(cid:52)(cid:73)(cid:66)(cid:83)(cid:70)
(cid:81)(cid:83)(cid:70)(cid:78)(cid:74)(cid:86)(cid:78)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:68)(cid:90)
(cid:85)(cid:83)(cid:66)(cid:79)(cid:84)(cid:77)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
(cid:83)(cid:70)(cid:84)(cid:70)(cid:83)(cid:87)(cid:70)(cid:1)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:36)(cid:66)(cid:84)h ﬂ(cid:80)(cid:88)(cid:1)
(cid:73)(cid:70)(cid:69)(cid:72)(cid:74)(cid:79)(cid:72)
(cid:83)(cid:70)(cid:84)(cid:70)(cid:83)(cid:87)(cid:70)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:51)(cid:70)(cid:85)(cid:66)(cid:74)(cid:79)(cid:70)(cid:69)
(cid:70)(cid:66)(cid:83)(cid:79)(cid:74)(cid:79)(cid:72)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:48)(cid:85)(cid:73)(cid:70)(cid:83)
(cid:83)(cid:70)(cid:84)(cid:70)(cid:83)(cid:87)(cid:70)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:47)(cid:80)(cid:79)(cid:14)
(cid:68)(cid:80)(cid:79)(cid:85)(cid:83)(cid:80)(cid:77)(cid:77)(cid:74)(cid:79)(cid:72)
(cid:74)(cid:79)(cid:85)(cid:70)(cid:83)(cid:70)(cid:84)(cid:85)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

42

2,583

2,526

223,820

(389)

(741)

242,399

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:20)(cid:1)(cid:9)(cid:83)(cid:70)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:69)(cid:10)

Balance at 1st July 2012

Proﬁt/(loss) for the year

(cid:48)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)
(cid:66)(cid:79)d e(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)
Remeasurement of deﬁned beneﬁt pension 
liabilities (net of tax) 

Foreign exchange translation differences
Changes in fair value of cash ﬂow hedges  
(net of tax)

Relating to associates

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:80)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)

Transactions with owners recorded directly in 
equity – dividends paid

–

–

–

–

–

–

–

–

(cid:35)(cid:66)(cid:77)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:66)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:20)

14,558

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

Proﬁt/(loss) for the year

(cid:48)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)
(cid:66)(cid:79)d e(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)
Remeasurement of deﬁned beneﬁt pension 
liabilities (net of tax)

Foreign exchange translation differences
Changes in fair value of cash ﬂow hedges  
(net of tax)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:80)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)

Acquisition of non-controlling interest

Dividends paid
Transactions with owners recorded directly 
in equity

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

–

42

–

–

–

–

–

–

–

–

–

–

–

67,643

–

346

–

–

–

–

(3,220)

(981)

–

–

–

(102)

346

(3,220)

(1,083)

346

(3,220)

66,560

–

–

(28,773)

–

–

–

–

–

–

–

–

(593)

67,050

–

–

–

–

–

(981)

346

(3,220)

(102)

(3,957)

(593)

63,093

–

(28,773)

2,929

(694)

261,607

(389)

(1,334)

276,719

–

–

(5,754)

–

(5,754)

–

86,215

–

–

26,274

26,274

(2,763)

–

–

(2,763)

(5,754)

26,274

83,452

–

–

–

–

–

–

(549)

85,666

–

–

–

–

(2,763)

(5,754)

26,274

17,757

(549)

103,423

–

–

–

–

–

–

–

(29,115)

(29,115)

(71)

–

(71)

(193)

(264)

–

(29,115)

(193)

(29,379)

(cid:35)(cid:66)(cid:77)(cid:66)(cid:79)(cid:68)(cid:70)(cid:1)(cid:66)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:18)(cid:21)(cid:13)(cid:22)(cid:22)(cid:25)

(cid:21)(cid:19)

(cid:9)(cid:19)(cid:13)(cid:25)(cid:19)(cid:22)(cid:10)

(cid:19)(cid:22)(cid:13)(cid:22)(cid:25)(cid:17)

(cid:20)(cid:18)(cid:22)(cid:13)(cid:26)(cid:21)(cid:21)

(cid:9)(cid:21)(cid:23)(cid:17)(cid:10)

(cid:9)(cid:19)(cid:13)(cid:17)(cid:24)(cid:23)(cid:10)

(cid:20)(cid:22)(cid:17)(cid:13)(cid:24)(cid:23)(cid:20)

More details of share capital and reserves are given in note 21.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

93

Notes

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

Restated
2013
£’000

(cid:25)(cid:22)(cid:13)(cid:23)(cid:23)(cid:23)

67,050

10

10, 11

9

11

5

5

7

18

10

5

11

5

21

17

(cid:25)(cid:13)(cid:20)(cid:21)(cid:22)

(cid:20)(cid:13)(cid:20)(cid:17)(cid:21)

(cid:18)(cid:18)(cid:13)(cid:20)(cid:17)(cid:21)

(cid:9)(cid:19)(cid:21)(cid:10)

(cid:9)(cid:26)(cid:22)(cid:17)(cid:10)

(cid:9)(cid:19)(cid:23)(cid:13)(cid:19)(cid:25)(cid:17)(cid:10)

(cid:9)(cid:23)(cid:24)(cid:26)(cid:10)

(cid:18)(cid:13)(cid:24)(cid:20)(cid:23)

(cid:18)(cid:17)(cid:13)(cid:24)(cid:19)(cid:17)

(cid:24)(cid:13)(cid:21)(cid:24)(cid:23)

(cid:19)(cid:13)(cid:19)(cid:25)(cid:26)

(cid:9)(cid:18)(cid:26)(cid:13)(cid:17)(cid:25)(cid:26)(cid:10)

(cid:9)(cid:19)(cid:13)(cid:22)(cid:24)(cid:20)(cid:10)

(cid:9)(cid:20)(cid:20)(cid:23)(cid:10)

(cid:9)(cid:18)(cid:26)(cid:13)(cid:24)(cid:17)(cid:26)(cid:10)

(cid:9)(cid:19)(cid:13)(cid:19)(cid:24)(cid:22)(cid:10)

(cid:9)(cid:18)(cid:18)(cid:13)(cid:21)(cid:17)(cid:24)(cid:10)

(cid:22)(cid:26)(cid:13)(cid:24)(cid:22)(cid:18)

(cid:9)(cid:20)(cid:26)(cid:13)(cid:17)(cid:22)(cid:17)(cid:10)

(cid:9)(cid:18)(cid:18)(cid:13)(cid:25)(cid:20)(cid:17)(cid:10)

(cid:9)(cid:21)(cid:25)(cid:20)(cid:10)

(cid:9)(cid:25)(cid:17)(cid:25)(cid:10)

(cid:111)

(cid:24)(cid:17)(cid:21)

(cid:23)(cid:24)(cid:26)

(cid:19)(cid:18)(cid:17)

(cid:20)(cid:19)(cid:13)(cid:17)(cid:18)(cid:25)

(cid:18)(cid:13)(cid:21)(cid:21)(cid:18)

(cid:9)(cid:18)(cid:24)(cid:13)(cid:18)(cid:18)(cid:26)(cid:10)

(cid:9)(cid:18)(cid:24)(cid:23)(cid:10)

(cid:9)(cid:19)(cid:26)(cid:13)(cid:18)(cid:18)(cid:22)(cid:10)

(cid:9)(cid:19)(cid:26)(cid:13)(cid:19)(cid:26)(cid:18)(cid:10)

(cid:18)(cid:20)(cid:13)(cid:20)(cid:21)(cid:18)

(cid:19)(cid:23)(cid:13)(cid:23)(cid:17)(cid:22)

(cid:20)(cid:13)(cid:23)(cid:25)(cid:25)

(cid:21)(cid:20)(cid:13)(cid:23)(cid:20)(cid:21)

7,558

3,280

10,293

(36)

(1,345)

(2,903)

(1,009)

1,909

15,046

32,793

(11,285)

15,339

(6,562)

460

(2,048)

(2,508)

(15,711)

79,576

(27,976)

(10,615)

(1,226)

–

(7,500)

299

1,009

307

–

541

(45,161)

(259)

(28,773)

(29,032)

5,383

21,127

95

26,605

Consolidated statement of cash ﬂow

for the year ended 30th June 2014

(cid:36)(cid:66)(cid:84)(cid:73)(cid:1)ﬂ(cid:80)(cid:88)(cid:84)(cid:1)(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:80)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:68)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)
Proﬁt for the year

Adjustments for:

Amortisation of development costs

Amortisation of other intangibles

Depreciation

Proﬁt on sale of property, plant and equipment

Share of proﬁts from associates

Exceptional gain

Financial income

Financial expenses

Tax expense

Decrease/(increase) in inventories

(Increase)/decrease in trade and other receivables

Decrease in trade and other payables

(Decrease)/increase in provisions

Deﬁned beneﬁt pension contributions

Income taxes paid
(cid:36)(cid:66)(cid:84)(cid:73)(cid:1)ﬂ(cid:80)(cid:88)(cid:84)(cid:1)(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:80)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:68)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

(cid:42)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:68)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

Purchase of property, plant and equipment

Development costs capitalised

Purchase of other intangibles

Investment in subsidiaries and associates

Payments in respect of deferred consideration

Sale of property, plant and equipment

Interest received

Dividends received from associates

Exceptional item – sale of shareholding in Delcam plc

Payments from pension scheme escrow account (net)
(cid:36)(cid:66)(cid:84)h ﬂ(cid:80)(cid:88)(cid:84)(cid:1)(cid:71)(cid:83)(cid:80)(cid:78)(cid:1)(cid:74)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:68)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:68)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

Interest paid

Dividends paid
(cid:36)(cid:66)(cid:84)h ﬂ(cid:80)(cid:88)(cid:84)(cid:1)(cid:71)(cid:83)(cid:80)m ﬁ(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:68)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

(cid:47)(cid:70)(cid:85)(cid:1)(cid:74)(cid:79)(cid:68)(cid:83)(cid:70)(cid:66)(cid:84)(cid:70)(cid:1)(cid:74)(cid:79)(cid:1)(cid:68)(cid:66)(cid:84)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:66)(cid:84)(cid:73)(cid:1)(cid:70)(cid:82)(cid:86)(cid:74)(cid:87)(cid:66)(cid:77)(cid:70)(cid:79)(cid:85)(cid:84)

Cash and cash equivalents at the beginning of the year

Effect of exchange rate ﬂuctuations on cash held

(cid:36)(cid:66)(cid:84)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:66)(cid:84)(cid:73)(cid:1)(cid:70)(cid:82)(cid:86)(cid:74)(cid:87)(cid:66)(cid:77)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:66)(cid:85)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:70)(cid:79)(cid:69)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

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94

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes (forming part of the ﬁnancial statements)

(cid:18)(cid:15)(cid:1)(cid:34)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:70)(cid:84)

(cid:35)(cid:66)(cid:84)(cid:74)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)(cid:81)(cid:83)(cid:70)(cid:81)(cid:66)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
Renishaw plc (the “Company”) is a company incorporated in the UK. 

The group ﬁnancial statements consolidate those of the Company and its subsidiaries (together referred to as the “Group”) and equity account 
the Group’s interest in associates.

The group ﬁnancial statements have been prepared and approved by the directors in accordance with International Financial Reporting 
Standards as adopted by the EU (“adopted IFRS”) and those parts of the Companies Act 2006 applicable to companies reporting under IFRS. 
The Company has elected to prepare its parent company ﬁnancial statements in accordance with UK GAAP.

The accounting policies set out below have been applied consistently to all periods presented in these group ﬁnancial statements with the 
exception of ﬁrst time application of IAS 19 “Employee Beneﬁts (Revised)”, IFRS 13 “Fair Value Measurement” and amendments to IFRS 7 
“Financial Instruments: Disclosures - Offsetting Financial Assets and Financial Liabilities”. Except for the adoption of IAS 19 “Employee Beneﬁts 
(Revised)” the adoption of these standards has not had a signiﬁcant effect on the consolidated results or ﬁnancial position of the Group. 
The impact of adopting IAS 19 “Employee Beneﬁts (Revised)” is set out below.

Judgements made by the directors, in the application of these accounting policies, that have a signiﬁcant effect on the ﬁnancial statements 
and estimates with a signiﬁcant risk of material adjustment in the next year are noted below.

(cid:35)(cid:66)(cid:84)(cid:74)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)(cid:66)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)
The ﬁnancial statements have been prepared under the historical cost convention, subject to items referred to in the derivative ﬁnancial 
instruments note below. The accounting policies set out below have been consistently applied in preparing both the 2013 and 2014 ﬁnancial 
statements.

(cid:36)(cid:83)(cid:74)(cid:85)(cid:74)(cid:68)(cid:66)(cid:77)(cid:1)(cid:66)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:75)(cid:86)(cid:69)(cid:72)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)
The preparation of ﬁnancial statements in conformity with adopted IFRS requires management to make judgements, estimates and 
assumptions that affect the application of policies and reported amounts of assets and liabilities, income and expenses. The estimates and 
associated assumptions are based on historical experience and various other factors that are believed to be reasonable under the 
circumstances, the results of which form the basis of making the judgements about carrying values of assets and liabilities that are not readily 
apparent from other sources. Actual results may differ from these estimates. The estimates and underlying assumptions are reviewed on an 
ongoing basis.

The estimates and assumptions that have a signiﬁcant risk of causing a material adjustment to the carrying amount of assets and liabilities 
in the next ﬁnancial year are listed below:

(i) Inventory
Determining the value of inventory requires judgement, especially in respect of provisioning for slow moving and potentially obsolete inventory. 
Management consider historic and future forecast sales patterns of individual stock items when calculating inventory provisions. 
(ii) Impairment of goodwill
Determining whether goodwill is impaired requires an estimation of the value in use of cash-generating units (“CGU”s) to which goodwill has 
been allocated. The value in use calculation involves an estimation of the future cash ﬂows of CGUs and also the selection of appropriate 
discount rates, which involves judgement, to calculate present values (see note 10).

(iii) Deﬁned beneﬁt pension scheme liabilities
Determining the value of the future deﬁned beneﬁt obligation requires judgement in respect of the assumptions used to calculate present values. 
These include future mortality, discount rate, inﬂation and salary increases. Management makes these judgements in consultation with an 
independent actuary. Details of the estimates and judgements in respect of the current year are given in note 15.

(iv) Amortisation of intangibles and impairment
The periods of amortisation of intangible assets require judgements to be made on the estimated useful lives of the intangible assets 
to determine an appropriate rate of amortisation. Future assessments of impairment may lead to the writing off of certain amounts of intangible 
assets and the consequent charge in the Consolidated income statement for the accelerated amortisation.

(v) Capitalisation of development costs
Product development costs are capitalised once a project has reached a certain stage of development and these costs are subsequently 
amortised over a ﬁve-year period. Judgements are required to assess whether the new product development has reached the appropriate point 
for capitalisation of costs to begin. Should a product be subsequently obsoleted, the accumulated capitalised development costs would need 
to be immediately written off in the Consolidated income statement.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

95

(cid:18)(cid:15)(cid:1)(cid:34)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

(cid:47)(cid:70)(cid:88)(cid:13)(cid:1)(cid:83)(cid:70)(cid:87)(cid:74)(cid:84)(cid:70)(cid:69)(cid:1)(cid:80)(cid:83)(cid:1)(cid:68)(cid:73)(cid:66)(cid:79)(cid:72)(cid:70)(cid:84)(cid:1)(cid:85)(cid:80)(cid:1)(cid:70)(cid:89)(cid:74)(cid:84)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:84)(cid:85)(cid:66)(cid:79)(cid:69)(cid:66)(cid:83)(cid:69)(cid:84)
The following adopted IFRS has been applied by the Group for the ﬁrst time in these ﬁnancial statements. 
Amendments to IAS 19 “Employee Beneﬁts” (mandatory for years commencing on or after 1st January 2013) for deﬁned beneﬁt schemes. 
The amendments introduce various changes: 
(i) past service costs are recognised immediately and no longer deferred; 
(ii) the expected return on plan assets and the interest cost on liabilities in the income statement are replaced by interest on the net deﬁned 
beneﬁt asset/liability using the discount rate used to measure the deﬁned beneﬁt obligation; this changes the allocation of the total return on 
plan assets between the income statement and other comprehensive income; 
(iii) asset management costs are recognised in other comprehensive income while other administrative costs are charged to operating proﬁts. 
Both were previously charged to operating proﬁts; 
(iv) the Group continues to assess the impact of the amended standard’s requirement to recognise employee contributions over the employee’s 
period of service, rather than as the contributions are received; and
(v) removal of the accounting policy choice for recognition of actuarial gains and losses is not expected to have any impact on the Group, since it 
already recognises them immediately in other comprehensive income.
The amended standard was required to be applied retrospectively. Therefore, the 2013 results have been restated with the result that the proﬁt 
before tax for that year is now £2.3m lower than previously reported, with a compensating credit in other comprehensive income. The effect of 
the amendment on the current ﬁnancial year is a decrease in net ﬁnance income by £2.9m, with a corresponding credit in other comprehensive 
income. The analysis of the adjustments to the Consolidated income statement and Consolidated statement of comprehensive income and 
expenditure for 2013 is:

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(cid:36)(cid:80)(cid:79)(cid:84)(cid:80)(cid:77)(cid:74)(cid:69)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)
(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)
(cid:38)(cid:89)(cid:81)(cid:70)(cid:68)(cid:85)(cid:70)(cid:69)(cid:1)(cid:83)(cid:70)(cid:85)(cid:86)(cid:83)(cid:79)(cid:1)(cid:80)(cid:79)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:81)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:84)

Originally reported

Restated

Change to Financial income

(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)(cid:84)
(cid:42)(cid:79)(cid:85)(cid:70)(cid:83)(cid:70)(cid:84)(cid:85)(cid:1)(cid:80)(cid:79)(cid:1)(cid:81)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:84)

Originally reported

Restated

Change to Financial expenses

Change to Proﬁt before taxation

Tax thereon

Change to Proﬁt for the year

(cid:36)(cid:80)(cid:79)(cid:84)(cid:80)(cid:77)(cid:74)(cid:69)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)

(cid:51)(cid:70)(cid:78)(cid:70)(cid:66)(cid:84)(cid:86)(cid:83)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:69)(cid:70)ﬁ(cid:79)(cid:70)(cid:69)(cid:1)(cid:67)(cid:70)(cid:79)(cid:70)ﬁt(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

Originally reported

Restated

Change to Remeasurement of deﬁned beneﬁt liabilities

(cid:37)(cid:70)(cid:71)(cid:70)(cid:83)(cid:83)(cid:70)(cid:69)(cid:1)(cid:85)(cid:66)(cid:89)(cid:1)(cid:80)(cid:79)(cid:1)(cid:74)(cid:85)(cid:70)(cid:78)(cid:84)(cid:1)(cid:85)(cid:73)(cid:66)(cid:85)(cid:1)(cid:88)(cid:74)(cid:77)(cid:77)(cid:1)(cid:79)(cid:80)(cid:85)(cid:1)(cid:67)(cid:70)(cid:1)(cid:83)(cid:70)(cid:68)(cid:77)(cid:66)(cid:84)(cid:84)(cid:74)ﬁ(cid:70)(cid:69)

Originally reported

Restated

Change to Deferred tax on items that will not be reclassiﬁed

Change to Total other comprehensive income and expense

2013
£’000

6,583

–

(6,583)

2013
£’000

5,638

1,378

4,260

2013
£’000

(2,323)

548

(1,775)

2013
£’000

(3,183)

(860)

2,323

2013
£’000

427

(121)

(548)

2013
£’000

1,775

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96

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

(cid:18)(cid:15)(cid:1)(cid:34)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

The following standards issued by the International Accounting Standards Board have been adopted by the EU, but only become effective for 
accounting periods commencing after 30th June 2014:

(a) IFRS 10 “Consolidated Financial Statements”, IFRS 11 “Joint Arrangements”, IFRS 12 “Disclosures of Interests in Other Entities”, amendment 
to IAS 27 “Separate Financial Statements” and amendment to IAS 28 “Investments in Associates and Joint Ventures” are a package of new 
standards and amendments that set out the basis for consolidation and the accounting requirements. The Group will adopt these standards 
on 1st July 2014.

(b) Amendments to IAS 32 “Financial Instruments: Presentation – Offsetting Financial Assets and Financial Liabilities”. This amendment sets out 
the criteria required for offsetting. The Group will adopt this amendment on 1st July 2014.

The Group does not currently expect that adoption of these standards will have a signiﬁcant effect on the consolidated results or ﬁnancial 
position of the Group.

(cid:36)(cid:80)(cid:79)(cid:84)(cid:80)(cid:77)(cid:74)(cid:69)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
Subsidiaries are entities controlled by the Group. Control exists when the Group has the power, directly or indirectly, to govern the ﬁnancial and 
operating policies of an entity so as to obtain beneﬁts from its activities. The ﬁnancial statements of subsidiaries are included in the consolidated 
ﬁnancial statements from the date that control commences until the date that control ceases.

Associates are those entities in which the Group has signiﬁcant inﬂuence, but not control, over the ﬁnancial and operating policies. 
The consolidated ﬁnancial statements include the Group’s share of the total recognised income and expense of associates on an equity 
accounted basis, from the date that signiﬁcant inﬂuence commences until the date that signiﬁcant inﬂuence ceases. 

(cid:51)(cid:70)(cid:87)(cid:70)(cid:79)(cid:86)(cid:70)
Revenue from the sale of goods is recognised in the Consolidated income statement when the signiﬁcant risks and rewards of ownership have 
been transferred to the buyer, which is the time of despatch. Where certain products require installation, part of the revenue may be deferred 
until the installation is complete.

No revenue is recognised if there are signiﬁcant uncertainties regarding recovery of the consideration due, or the possible return of goods.

(cid:39)(cid:80)(cid:83)(cid:70)(cid:74)(cid:72)(cid:79)(cid:1)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:68)(cid:74)(cid:70)(cid:84)
Foreign subsidiaries’ results are translated into Sterling at weighted average exchange rates for the year, which is effected by translating each 
foreign subsidiary’s monthly results at exchange rates applicable to each of the respective months. Assets and liabilities denominated in foreign 
currencies at the balance sheet date are translated into Sterling at the foreign exchange rates ruling at that date. Differences on exchange 
resulting from the translation of overseas assets and liabilities are recognised directly in equity.

Gains and losses arising on currency borrowings used to hedge the foreign currency exposure on the net assets of the foreign operations are 
accounted for directly in equity, to the extent that hedge accounting criteria are met and are included in the Consolidated statement of 
comprehensive income and expense. See the note on derivative ﬁnancial instruments below, for the accounting policies for forward exchange 
contracts and currency borrowings.

(cid:37)(cid:70)(cid:83)(cid:74)(cid:87)(cid:66)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)fi(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:74)(cid:79)(cid:84)(cid:85)(cid:83)(cid:86)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)
Derivative ﬁnancial instruments are recognised at fair value. The gain or loss on remeasurement to fair value is recognised immediately in the 
Consolidated income statement. However, where derivatives qualify for hedge accounting, recognition of any resultant gain or loss depends 
on the nature of the item being hedged.

(cid:41)(cid:70)(cid:69)(cid:72)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:79)(cid:70)(cid:85)(cid:1)(cid:74)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:74)(cid:79)(cid:1)(cid:71)(cid:80)(cid:83)(cid:70)(cid:74)(cid:72)(cid:79)(cid:1)(cid:80)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
The portion of the gain or loss on an instrument used to hedge a net investment in a foreign operation that is determined to be 
an effective hedge is recognised directly in equity. Any ineffective portion is recognised immediately in the Consolidated income statement. 
The effectiveness of the hedging is tested monthly.

(cid:40)(cid:80)(cid:80)(cid:69)(cid:88)(cid:74)(cid:77)(cid:77)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:80)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:74)(cid:79)(cid:85)(cid:66)(cid:79)(cid:72)(cid:74)(cid:67)(cid:77)(cid:70)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)
Business combinations are accounted for using the acquisition method as at the acquisition date, which is the date on which control is 
transferred to the Group.

Costs related to the acquisition, other than those associated with the issue of debt or equity securities, are expensed as incurred. Deferred 
consideration relating to acquisitions is subject to discounting to the date of acquisition and subsequently unwound to the date of the ﬁnal 
payment.

Goodwill arising on acquisition represents the difference between the cost of the acquisition and the fair value of the net identiﬁable assets 
acquired, net of deferred tax. Identiﬁable intangibles are those which can be sold separately or which arise from legal rights regardless of 
whether those rights are separable.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

97

(cid:18)(cid:15)(cid:1)(cid:34)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

Where there exists an option to purchase the non-controlling interest of a subsidiary and the option is deemed to have been exercised, the 
Group has adopted the anticipated-acquisition method. Any changes to the carrying amount of the liability are recognised in the Consolidated 
income statement.

Goodwill is stated at cost less any accumulated impairment losses. It is not amortised but is tested annually for impairment or earlier if there are any 
indications of impairment. The annual impairment review involves comparing the carrying amount to the estimated recoverable amount and 
recognising an impairment loss if the recoverable amount is lower. Impairment losses are recognised through the Consolidated income statement.

Intangible assets such as customer lists, patents, trade marks, know-how and intellectual property that are acquired by the Group are stated 
at cost less amortisation and impairment losses. Amortisation is charged to the Consolidated income statement on a straight-line basis over 
the estimated useful lives of the intangible assets. The estimated useful lives of the intangible assets included in the Consolidated balance sheet 
reﬂect the beneﬁt derived by the Group and vary from 5 to 10 years.

On a transaction by transaction basis, the Group elects to measure non-controlling interests, which have both present ownership interests and 
are entitled to a proportionate share of net assets of the acquiree in the event of liquidation, either at its fair value or at its proportionate interest 
in the recognised amount of the identiﬁable net assets of the acquiree at the acquisition date. All other non-controlling interests are measured 
at their fair value at the acquisition date.

Where there are changes to the Company’s interests in subsidiaries while retaining control, any differences between the amount by which 
non-controlling interests are adjusted and fair value of consideration paid or received is recognised directly in equity in the “other reserve”.

(cid:42)(cid:79)(cid:85)(cid:66)(cid:79)(cid:72)(cid:74)(cid:67)(cid:77)(cid:70)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:109)(cid:1)(cid:83)(cid:70)(cid:84)(cid:70)(cid:66)(cid:83)(cid:68)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:68)(cid:80)(cid:84)(cid:85)(cid:84)
Expenditure on research activities is recognised in the Consolidated income statement as an expense as incurred. Expenditure on development 
activities is capitalised if the product or process is technically and commercially feasible and the Group intends and has the technical ability 
and sufﬁcient resources to complete development, future economic beneﬁts are probable and the Group can measure reliably the expenditure 
attributable to the intangible asset during its development. Development activities involve a plan or design for the production of new or 
substantially improved products or processes. The expenditure capitalised includes the cost of materials, direct labour and an appropriate 
proportion of overheads. Other development expenditure is recognised in the Consolidated income statement as an expense as incurred. 
Capitalised development expenditure is stated at cost less accumulated amortisation and less accumulated impairment losses.

(cid:42)(cid:79)(cid:85)(cid:66)(cid:79)(cid:72)(cid:74)(cid:67)(cid:77)(cid:70)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:109)(cid:1)(cid:84)(cid:80)(cid:71)(cid:85)(cid:88)(cid:66)(cid:83)(cid:70)(cid:1)(cid:77)(cid:74)(cid:68)(cid:70)(cid:79)(cid:68)(cid:70)(cid:84)
Intangible assets comprising software licences, that are acquired by the Group, are stated at cost less accumulated amortisation and 
impairment losses. Amortisation is charged on a straight-line basis over the estimated useful life of the assets. The useful life of each of these 
assets is assessed on an individual basis and they range from 2 to 10 years. 

(cid:49)(cid:83)(cid:80)(cid:81)(cid:70)(cid:83)(cid:85)(cid:90)(cid:13)(cid:1)(cid:81)(cid:77)(cid:66)(cid:79)(cid:85)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:70)(cid:82)(cid:86)(cid:74)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)
Freehold land is not depreciated. Other assets are stated at cost less accumulated depreciation. Depreciation is provided to write off the cost 
of assets less their estimated residual value on a straight-line basis over their estimated useful economic lives as follows:

Freehold buildings 
Plant and equipment 
Vehicles 

50 years 
3 to 10 years 
3 to 4 years

(cid:56)(cid:66)(cid:83)(cid:83)(cid:66)(cid:79)(cid:85)(cid:90)(cid:1)(cid:81)(cid:83)(cid:80)(cid:87)(cid:74)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)
The Group provides a warranty from the date of purchase on all its products. This is typically for a 12-month period, although up to three years 
is given for a small number of products. A warranty provision is included in the ﬁnancial statements, which is calculated on the basis of historical 
returns and internal quality reports. 

(cid:38)(cid:78)(cid:81)(cid:77)(cid:80)(cid:90)(cid:70)(cid:70)(cid:1)(cid:67)(cid:70)nefi(cid:85)(cid:84)
The Group operates contributory pension schemes, largely for UK, Ireland and USA employees, which were of the deﬁned beneﬁt type up to 
5th April 2007, 31st December 2007 and 30th June 2012 respectively, at which time they ceased any future accrual for existing members and 
were closed to new members. 

The schemes are administered by trustees who are independent of the group ﬁnances. Pension scheme assets of the deﬁned beneﬁt schemes 
are measured using market value. Pension scheme liabilities are measured using a projected unit method and discounted at the current rate 
of return on a high-quality corporate bond of equivalent term and currency to the liability. Remeasurements arising from deﬁned beneﬁt plans 
comprise actuarial gains and losses, the return on plan assets (excluding interest) and the effect of the asset ceiling (if any, excluding interest). 
The Company recognises them immediately in other comprehensive income and all other expenses related to deﬁned beneﬁt plans are included 
in the Consolidated income statement. 

The pension schemes’ surpluses, to the extent that they are considered recoverable, or deﬁcits are recognised in full and presented on the face 
of the Consolidated balance sheet under employee beneﬁts. Where a guarantee is in place in relation to a pension scheme deﬁcit, liabilities are 
reported in accordance with IFRIC 14. 

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98

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

(cid:18)(cid:15)(cid:1)(cid:34)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

Foreign-based employees are covered by state, deﬁned beneﬁt and private pension schemes in their countries of residence. Actuarial valuations 
of foreign pension schemes were not obtained, apart from Ireland and USA, because of the limited number of foreign employees.

For deﬁned contribution schemes, the amount charged to the Consolidated income statement represents the contributions payable to the 
schemes in respect of the accounting period.

Accruals are made for holiday pay, based on a calculation of the number of days holiday earned during the year, but not yet taken.

(cid:36)(cid:66)(cid:84)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:66)(cid:84)(cid:73)(cid:1)(cid:70)(cid:82)(cid:86)(cid:74)(cid:87)(cid:66)(cid:77)(cid:70)(cid:79)(cid:85)(cid:84)
Cash and cash equivalents comprise cash balances and short-term (with an original maturity of less than three months) deposits. Bank 
overdrafts that are repayable on demand form part of cash and cash equivalents for the purpose of the Consolidated statement of cash ﬂow.

(cid:37)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)(cid:84)
Dividends unpaid at the balance sheet date are only recognised as a liability at that date to the extent that they are appropriately declared and 
authorised and no longer at the discretion of the Company.

(cid:53)(cid:66)(cid:89)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
Tax on the proﬁt for the year comprises current and deferred tax. Tax is recognised in the Consolidated income statement except to the extent that 
it relates to items recognised directly in equity, in which case it is recognised in the Consolidated statement of comprehensive income and expense.

Current tax is the expected tax payable on the taxable income for the year, using tax rates enacted or substantively enacted at the balance sheet 
date, and any adjustment to tax payable in previous years.

Deferred tax is provided on temporary differences between the carrying amounts of assets and liabilities for ﬁnancial reporting purposes and the 
amounts used for taxation purposes. The following temporary differences are not provided for: the initial recognition of goodwill, the initial 
recognition of assets or liabilities that affect neither accounting nor taxable proﬁt other than in a business combination and differences relating to 
investments in subsidiaries to the extent that they will probably not reverse in the foreseeable future. The amount of deferred tax provided is based 
on the expected manner of realisation or settlement of the carrying amount of assets and liabilities, using tax rates enacted or substantively enacted 
at the balance sheet date. A deferred tax asset is recognised only to the extent that it is probable that future taxable proﬁts will be available against 
which the asset can be utilised.

(cid:38)(cid:89)(cid:68)(cid:70)(cid:81)(cid:85)(cid:74)(cid:80)(cid:79)(cid:66)(cid:77)(cid:1)(cid:74)(cid:85)(cid:70)(cid:78)(cid:84)
Exceptional items are items which due to their size, incidence and non-recurring nature have been classiﬁed separately in order to draw them 
to the attention of the reader of the accounts and, in management’s judgement, to show more accurately the underlying results of the Group. 
Such items are included within the Consolidated income statement caption to which they relate and are disclosed separately on the face of the 
Consolidated income statement.

(cid:40)(cid:80)(cid:74)(cid:79)(cid:72)(cid:1)(cid:68)(cid:80)(cid:79)(cid:68)(cid:70)(cid:83)(cid:79)
The Group’s business activities, together with the factors likely to affect its future development, performance and position, are set out in the 
Strategic report, where also given are details of the ﬁnancial and liquidity positions. In addition, note 22 in the ﬁnancial statements includes the 
Group’s objectives and policies for managing its capital, details of its ﬁnancial instruments and hedging activities and its exposures to credit risk 
and liquidity risk.

The Group has considerable ﬁnancial resources at its disposal and the directors have considered the current ﬁnancial projections. As a 
consequence, the directors believe that the Group is well placed to manage its business risks successfully.

After making enquiries, the directors have a reasonable expectation that the Company and the Group have adequate resources to continue in 
operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the Annual report and 
accounts.

(cid:36)(cid:66)(cid:84)h fl(cid:80)(cid:88)(cid:1)(cid:73)(cid:70)(cid:69)(cid:72)(cid:70)(cid:84)
Forward exchange contracts are recognised at fair value. Where a forward contract is designated as a hedge of the variability in future cash 
inﬂows, the effective part of any gain or loss on the forward contract is recognised directly in equity. Any effective cumulative gain or loss is 
removed from equity and recognised in the Consolidated income statement at the same time as the hedged transaction. The ineffective part 
of any gain or loss is recognised in the Consolidated income statement immediately.

If the hedged transaction is no longer expected to take place, the cumulative unrealised gain or loss held in equity is recognised in the 
Consolidated income statement immediately. The effectiveness of cash ﬂow hedges is tested on a monthly basis by comparing the cash inﬂows 
with the hedging amounts.

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

99

(cid:18)(cid:15)(cid:1)(cid:34)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

(cid:42)(cid:79)(cid:87)(cid:70)(cid:79)(cid:85)(cid:80)(cid:83)(cid:90)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:88)(cid:80)(cid:83)(cid:76)(cid:1)(cid:74)(cid:79)(cid:1)(cid:81)(cid:83)(cid:80)(cid:72)(cid:83)(cid:70)(cid:84)(cid:84)
Inventory and work in progress is valued at the lower of cost and net realisable value. In respect of work in progress and ﬁnished goods, cost 
includes all production overheads and the attributable proportion of indirect overhead expenses which are required to bring inventories to their 
present location and condition. Overheads are absorbed into inventories on the basis of normal capacity.

(cid:49)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:1)(cid:68)(cid:66)(cid:84)(cid:73)(cid:1)(cid:70)(cid:84)(cid:68)(cid:83)(cid:80)(cid:88)(cid:1)(cid:66)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)
The Company holds a pension scheme escrow account as part of the security given for the UK deﬁned beneﬁt pension scheme. This account 
is shown within current assets in the Consolidated balance sheet as it may be used to settle pension scheme liabilities at any time.

(cid:19)(cid:15)(cid:1)(cid:52)(cid:70)(cid:72)(cid:78)(cid:70)(cid:79)(cid:85)(cid:66)(cid:77)(cid:1)(cid:66)(cid:79)(cid:66)(cid:77)(cid:90)(cid:84)(cid:74)(cid:84)

Renishaw manages its operations in two segments, comprising metrology and healthcare products. The results of these segments are regularly 
reviewed by the Board to allocate resources to segments and to assess their performance. The Group evaluates performance of the segments 
on the basis of revenue and proﬁts. Within metrology, there are multiple operating segments that are aggregated into a reporting segment for 
reportable purposes, where the nature of the products and their customer base are similar. The revenue, depreciation and amortisation, and 
operating proﬁt for each reportable segment were:

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(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

Revenue

Depreciation and amortisation

Operating proﬁt/(loss) before exceptional item

Share of proﬁts from associates

Exceptional gain on disposal of shareholding in Delcam plc

Net ﬁnancial expense

Proﬁt before tax

Year ended 30th June 2013 (restated)

Revenue

Depreciation and amortisation

Operating proﬁt/(loss)

Share of proﬁts from associates

Exceptional gain on deferred consideration settlement

Net ﬁnancial expense

Proﬁt before tax

(cid:46)(cid:70)(cid:85)(cid:83)(cid:80)(cid:77)(cid:80)(cid:72)(cid:90)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:20)(cid:19)(cid:23)(cid:13)(cid:23)(cid:20)(cid:20)

(cid:18)(cid:26)(cid:13)(cid:17)(cid:20)(cid:23)

(cid:24)(cid:21)(cid:13)(cid:20)(cid:24)(cid:21)

(cid:24)(cid:24)(cid:22)

(cid:19)(cid:23)(cid:13)(cid:19)(cid:25)(cid:17)

(cid:111)

(cid:111)

Metrology
£’000

317,857

17,776

84,528

1,022

2,903

–

–

(cid:41)(cid:70)(cid:66)(cid:77)(cid:85)(cid:73)(cid:68)(cid:66)(cid:83)(cid:70)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:25)(cid:13)(cid:25)(cid:23)(cid:22)

(cid:20)(cid:13)(cid:26)(cid:18)(cid:24)

(cid:9)(cid:20)(cid:13)(cid:26)(cid:25)(cid:23)(cid:10)

(cid:111)

(cid:111)

(cid:111)

(cid:111)

Healthcare
£’000

29,024

3,355

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:20)(cid:22)(cid:22)(cid:13)(cid:21)(cid:26)(cid:25)

(cid:19)(cid:19)(cid:13)(cid:26)(cid:22)(cid:20)

(cid:24)(cid:17)(cid:13)(cid:20)(cid:25)(cid:25)

(cid:24)(cid:24)(cid:22)

(cid:19)(cid:23)(cid:13)(cid:19)(cid:25)(cid:17)

(cid:9)(cid:18)(cid:13)(cid:17)(cid:22)(cid:24)(cid:10)

(cid:26)(cid:23)(cid:13)(cid:20)(cid:25)(cid:23)

Total
£’000

346,881

21,131

(5,457)

79,071

–

–

–

–

1,022

2,903

(900)

82,096

There is no allocation of assets and liabilities to operating segments. Depreciation is included within certain other overhead expenditure which is 
allocated to segments on the basis of the level of activity.

The analysis of revenue by geographical market was:

Far East, including Australasia

Continental Europe

North, South and Central America

UK and Ireland

Other regions

Total group revenue

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:20)(cid:21)(cid:13)(cid:22)(cid:23)(cid:26)

(cid:18)(cid:17)(cid:17)(cid:13)(cid:18)(cid:26)(cid:26)

(cid:25)(cid:22)(cid:13)(cid:22)(cid:23)(cid:19)

(cid:19)(cid:20)(cid:13)(cid:25)(cid:18)(cid:23)

(cid:18)(cid:18)(cid:13)(cid:20)(cid:22)(cid:19)

2013
£’000

138,806

96,003

79,220

20,668

12,184

(cid:20)(cid:22)(cid:22)(cid:13)(cid:21)(cid:26)(cid:25)

346,881

i

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100

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

(cid:19)(cid:15)(cid:1)(cid:52)(cid:70)(cid:72)(cid:78)(cid:70)(cid:79)(cid:85)(cid:66)(cid:77)(cid:1)(cid:66)(cid:79)(cid:66)(cid:77)(cid:90)(cid:84)(cid:74)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

Revenue in the previous table has been allocated to regions based on the geographical location of the customer. Individual countries which 
comprised more than 10% of group revenue were:

USA

China

Germany

Japan

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:24)(cid:18)(cid:13)(cid:17)(cid:17)(cid:24)

(cid:23)(cid:23)(cid:13)(cid:22)(cid:24)(cid:22)

(cid:21)(cid:20)(cid:13)(cid:17)(cid:21)(cid:20)

(cid:20)(cid:26)(cid:13)(cid:18)(cid:26)(cid:17)

There was no revenue from transactions with a single external customer amounting to 10% or more of the Group’s total revenue.

The following table shows the analysis of non-current assets by geographical region:

United Kingdom

Overseas

Total non-current assets

No overseas country had non-current assets amounting to 10% or more of the Group’s total non-current assets.

(cid:20)(cid:15)(cid:1)(cid:49)(cid:70)(cid:83)(cid:84)(cid:80)(cid:79)(cid:79)(cid:70)(cid:77)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)(cid:84)

The aggregate payroll costs for the year were:

Wages and salaries

Compulsory social security contributions

Contributions to deﬁned contribution plans

Total payroll costs

The average number of persons employed by the Group during the year was:

UK

Overseas

Average number of employees

The total remuneration of the directors was:

Salary and fees

Bonus

Beneﬁts

Pension contributions

Total remuneration of the directors

Full details of directors’ remuneration are given in the Directors’ remuneration report.

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:21)(cid:19)(cid:13)(cid:17)(cid:24)(cid:26)

(cid:22)(cid:24)(cid:13)(cid:23)(cid:21)(cid:21)

(cid:18)(cid:26)(cid:26)(cid:13)(cid:24)(cid:19)(cid:20)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:18)(cid:26)(cid:13)(cid:25)(cid:26)(cid:17)

(cid:18)(cid:20)(cid:13)(cid:24)(cid:18)(cid:21)

(cid:18)(cid:20)(cid:13)(cid:19)(cid:21)(cid:23)

(cid:18)(cid:21)(cid:23)(cid:13)(cid:25)(cid:22)(cid:17)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:47)(cid:86)(cid:78)(cid:67)(cid:70)(cid:83)

(cid:19)(cid:13)(cid:19)(cid:19)(cid:18)

(cid:18)(cid:13)(cid:18)(cid:19)(cid:21)

(cid:20)(cid:13)(cid:20)(cid:21)(cid:22)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:13)(cid:19)(cid:26)(cid:18)

–

(cid:24)(cid:24)

(cid:18)(cid:25)(cid:19)

(cid:19)(cid:13)(cid:22)(cid:22)(cid:17)

2013
£’000

66,426

75,228

41,085

35,655

2013
£’000

128,875

52,597

181,472

2013
£’000

112,675

13,305

11,273

137,253

2013
Number

2,043

1,049

3,092

2013
£’000

2,201

208

75

169

2,653

101

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

(cid:21)(cid:15)(cid:1)(cid:38)(cid:89)(cid:68)(cid:70)(cid:81)(cid:85)(cid:74)(cid:80)(cid:79)(cid:66)(cid:77)(cid:1)(cid:74)(cid:85)(cid:70)(cid:78)(cid:84)

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)
In February 2014, Autodesk Development B.V., a wholly owned subsidiary of Autodesk, Inc. acquired the whole of the issued share capital of 
Delcam plc at a price of £20.75 per share. Renishaw held 1,543,032 Delcam shares (19.4%) which resulted in a total consideration of £32.0m. 
The investment held in the balance sheet was £5.7m, giving a proﬁt on disposal of £26.3m, which has been disclosed as an exceptional item. 
Delcam plc was accounted for as an associate undertaking.

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:20)
In November 2012, the Group purchased the remaining 34% shareholding in Measurement Devices Limited (“MDL”) for the sum of £4,500,000, 
paid in cash. The original shareholders’ agreement provided Renishaw with the option to purchase the remaining shareholding in three tranches 
in May 2012, May 2013 and May 2014. The price per share to be paid was calculated as seven times earnings before interest and tax, with a 
minimum price per share of £2 and a maximum price per share of £8.94. The Group had applied the anticipated-acquisition method to this 
transaction, and an estimate of the outstanding purchase price, based on MDL’s three-year forecast, was provided within the ﬁnancial 
statements as deferred contingent consideration. This consideration totalled £7,403,000 in November 2012 and the subsequent  
re-measurement resulted in an exceptional gain of £2,903,000 recognised in the Consolidated income statement.

(cid:22)(cid:15)(cid:1)(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)(cid:84)

(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)

Interest receivable

(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)(cid:84)

Interest on pension schemes’ liabilities (note 15)

Bank interest payable

Unwinding of deferred acquisition cost interest

Total ﬁnancial expenses

(cid:23)(cid:15)(cid:1)(cid:49)(cid:83)ofit befor(cid:70)(cid:1)(cid:85)(cid:66)(cid:89)

Included in the proﬁt before tax are the following costs/(income):

Depreciation of property, plant and equipment

Amortisation of intangibles

Research and development expenditure

Proﬁt on sale of property, plant and equipment

Foreign currency (gains)/losses

Auditor:

  Audit of these ﬁnancial statements

  Audit of subsidiary undertakings pursuant to legislation

  Audit assurance

  Tax compliance 

  Tax advisory

  Other assurance services

  Corporate ﬁnance services

  Other services 

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:23)(cid:24)(cid:26)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:13)(cid:20)(cid:26)(cid:19)

(cid:18)(cid:24)(cid:23)

(cid:18)(cid:23)(cid:25)

(cid:18)(cid:13)(cid:24)(cid:20)(cid:23)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:18)(cid:13)(cid:20)(cid:17)(cid:21)

(cid:18)(cid:18)(cid:13)(cid:23)(cid:21)(cid:26)

(cid:20)(cid:23)(cid:13)(cid:20)(cid:17)(cid:23)

(cid:9)(cid:19)(cid:21)(cid:10)

(cid:9)(cid:25)(cid:23)(cid:10)

(cid:18)(cid:19)(cid:18)

(cid:18)(cid:23)(cid:21)

(cid:18)(cid:17)

(cid:18)(cid:18)(cid:20)

(cid:18)(cid:17)(cid:25)

(cid:24)(cid:21)

(cid:111)

(cid:21)(cid:18)

Restated
2013
£’000

1,009

2013
£’000

1,378

259

272

1,909

2013
£’000

10,293

10,838

33,898

(36)

(76)

99

178

10

107

78

73

98

85

Notes

(a)

 (a)

 (b)

 (c)

(c)

  (c)

 (c)

(c)

(c)

  (c)

  (c)

  (c)

  (c)

These costs/(income) can be found under the following headings in the Consolidated income statement: (a) within cost of sales, distribution 
costs and administrative expenses; (b) within cost of sales; and (c) within administrative expenses.

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102

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

(cid:24)(cid:15)(cid:1)(cid:42)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:85)(cid:66)(cid:89)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:85)(cid:66)(cid:89)(cid:27)

UK corporation tax on proﬁts for the year

Overseas tax on proﬁts for the year

Total current tax

(cid:37)(cid:70)(cid:71)(cid:70)(cid:83)(cid:83)(cid:70)(cid:69)(cid:1)(cid:85)(cid:66)(cid:89)(cid:27)

Origination and reversal of other temporary differences

Effect on deferred tax for change in UK tax rate to 20% (2013: 23%)

Tax charge on proﬁt

Effective tax rate (based on proﬁt before tax)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:20)(cid:13)(cid:26)(cid:25)(cid:20)

(cid:25)(cid:13)(cid:20)(cid:22)(cid:21)

(cid:18)(cid:19)(cid:13)(cid:20)(cid:20)(cid:24)

(cid:9)(cid:26)(cid:26)(cid:10)

(cid:9)(cid:18)(cid:13)(cid:22)(cid:18)(cid:25)(cid:10)

(cid:9)(cid:18)(cid:13)(cid:23)(cid:18)(cid:24)(cid:10)

(cid:18)(cid:17)(cid:13)(cid:24)(cid:19)(cid:17)

(cid:18)(cid:18)(cid:15)(cid:18)(cid:6)

The tax for the year is lower (2013: lower) than the weighted average of the UK standard rate of corporation tax of 22.5% (2013: 23.75%). 
The differences are explained as follows:

Proﬁt before tax

Tax at 22.5% (2013: 23.75%)

Effects of:

Different tax rates applicable in overseas subsidiaries

Research and development tax credit and patent box

Expenses not deductible for tax purposes

Companies with unrelieved tax losses

Items with no tax effect

Effect on deferred tax for change in UK tax rate to 20% (2013: 23%)

Other differences

Tax charge on proﬁt

The reductions of the UK corporation tax rate to 21% effective from 1st April 2014 and 20% from 1st April 2015 were substantively enacted on 
3rd July 2013. At 30th June 2014, UK deferred tax has been calculated at the rate of 20% for all timing differences.

(cid:25)(cid:15)(cid:1)(cid:38)(cid:66)(cid:83)(cid:79)(cid:74)(cid:79)(cid:72)(cid:84)(cid:1)(cid:81)(cid:70)(cid:83)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)

Basic and diluted earnings per share are calculated on earnings after tax of £86,215,000 (2013: £67,643,000) and on 72,788,543 shares, being 
the number of shares in issue during both years. There is no difference between the weighted average earnings per share and the basic and 
diluted earnings per share.

The adjusted earnings per share ﬁgure for 2014 and 2013 exclude the exceptional items.

Restated
2013
£’000

4,876

9,245

14,121

1,533

(608)

925

15,046

18.3%

Restated
2013
£’000

82,096

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:26)(cid:23)(cid:13)(cid:20)(cid:25)(cid:23)

(cid:19)(cid:18)(cid:13)(cid:23)(cid:25)(cid:24)

19,498

(cid:9)(cid:26)(cid:18)(cid:18)(cid:10)

(cid:9)(cid:19)(cid:13)(cid:26)(cid:19)(cid:20)(cid:10)

(cid:20)(cid:21)(cid:22)

(cid:21)(cid:24)(cid:24)

(cid:9)(cid:23)(cid:13)(cid:21)(cid:17)(cid:17)(cid:10)

(cid:9)(cid:18)(cid:13)(cid:22)(cid:18)(cid:25)(cid:10)

(cid:9)(cid:20)(cid:24)(cid:10)

(cid:18)(cid:17)(cid:13)(cid:24)(cid:19)(cid:17)

(2,082)

(1,942)

558

469

(932)

(608)

85

15,046

103

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

(cid:26)(cid:15)(cid:1)(cid:49)(cid:83)(cid:80)(cid:81)(cid:70)(cid:83)(cid:85)(cid:90)(cid:13)(cid:1)(cid:81)(cid:77)(cid:66)(cid:79)(cid:85)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:70)(cid:82)(cid:86)(cid:74)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:36)(cid:80)(cid:84)(cid:85)

At 1st July 2013

Additions

Transfers

Disposals

Currency adjustment

(cid:34)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:37)(cid:70)(cid:81)(cid:83)(cid:70)(cid:68)(cid:74)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

At 1st July 2013

Charge for the year

Released on disposals

Currency adjustment

(cid:34)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:47)(cid:70)(cid:85)(cid:1)(cid:67)(cid:80)(cid:80)(cid:76)(cid:1)(cid:87)(cid:66)(cid:77)(cid:86)(cid:70)

(cid:34)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

At 30th June 2013

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(cid:39)(cid:83)(cid:70)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)
(cid:77)(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:79)(cid:69)
(cid:67)(cid:86)(cid:74)(cid:77)(cid:69)(cid:74)(cid:79)(cid:72)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:49)(cid:77)(cid:66)(cid:79)(cid:85)(cid:1)(cid:66)(cid:79)(cid:69)
(cid:70)(cid:82)(cid:86)(cid:74)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:46)(cid:80)(cid:85)(cid:80)(cid:83)
(cid:87)(cid:70)(cid:73)(cid:74)(cid:68)(cid:77)(cid:70)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:34)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)
(cid:68)(cid:80)(cid:86)(cid:83)(cid:84)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:68)(cid:80)(cid:79)(cid:84)(cid:85)(cid:83)(cid:86)(cid:68)(cid:85)(cid:74)(cid:80)(cid:79)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:26)(cid:19)(cid:13)(cid:23)(cid:25)(cid:19)

(cid:18)(cid:18)(cid:21)(cid:13)(cid:21)(cid:22)(cid:18)

(cid:25)(cid:13)(cid:18)(cid:18)(cid:17)

(cid:18)(cid:13)(cid:22)(cid:17)(cid:21)

(cid:9)(cid:18)(cid:18)(cid:22)(cid:10)

(cid:9)(cid:21)(cid:13)(cid:18)(cid:19)(cid:22)(cid:10)

(cid:22)(cid:13)(cid:24)(cid:25)(cid:23)

(cid:18)(cid:21)(cid:13)(cid:18)(cid:18)(cid:17)

(cid:9)(cid:25)(cid:24)(cid:21)(cid:10)

(cid:9)(cid:19)(cid:13)(cid:20)(cid:20)(cid:26)(cid:10)

(cid:24)(cid:13)(cid:24)(cid:17)(cid:26)

(cid:18)(cid:13)(cid:17)(cid:23)(cid:21)

(cid:111)

(cid:9)(cid:20)(cid:20)(cid:21)(cid:10)

(cid:9)(cid:20)(cid:26)(cid:17)(cid:10)

(cid:22)(cid:13)(cid:20)(cid:17)(cid:21)

(cid:19)(cid:21)(cid:13)(cid:19)(cid:21)(cid:17)

(cid:9)(cid:18)(cid:22)(cid:13)(cid:23)(cid:18)(cid:21)(cid:10)

(cid:111)

(cid:111)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:19)(cid:17)(cid:13)(cid:18)(cid:21)(cid:23)

(cid:20)(cid:26)(cid:13)(cid:19)(cid:17)(cid:17)

(cid:111)

(cid:9)(cid:18)(cid:13)(cid:20)(cid:19)(cid:20)(cid:10)

(cid:9)(cid:23)(cid:13)(cid:25)(cid:22)(cid:21)(cid:10)

(cid:26)(cid:25)(cid:13)(cid:17)(cid:22)(cid:23)

(cid:18)(cid:20)(cid:18)(cid:13)(cid:18)(cid:20)(cid:21)

(cid:25)(cid:13)(cid:17)(cid:21)(cid:26)

(cid:18)(cid:20)(cid:13)(cid:26)(cid:20)(cid:17)

(cid:19)(cid:22)(cid:18)(cid:13)(cid:18)(cid:23)(cid:26)

(cid:19)(cid:17)(cid:13)(cid:23)(cid:21)(cid:19)

(cid:18)(cid:13)(cid:22)(cid:17)(cid:19)

(cid:9)(cid:24)(cid:25)(cid:10)

(cid:9)(cid:26)(cid:22)(cid:19)(cid:10)

(cid:24)(cid:23)(cid:13)(cid:25)(cid:19)(cid:22)

(cid:25)(cid:13)(cid:26)(cid:23)(cid:17)

(cid:9)(cid:20)(cid:22)(cid:26)(cid:10)

(cid:9)(cid:18)(cid:13)(cid:21)(cid:24)(cid:21)(cid:10)

(cid:19)(cid:18)(cid:13)(cid:18)(cid:18)(cid:21)

(cid:25)(cid:20)(cid:13)(cid:26)(cid:22)(cid:19)

(cid:21)(cid:13)(cid:24)(cid:22)(cid:20)

(cid:25)(cid:21)(cid:19)

(cid:9)(cid:19)(cid:17)(cid:23)(cid:10)

(cid:9)(cid:19)(cid:17)(cid:25)(cid:10)

(cid:22)(cid:13)(cid:18)(cid:25)(cid:18)

(cid:111)

(cid:111)

(cid:111)

(cid:111)

(cid:111)

(cid:18)(cid:17)(cid:19)(cid:13)(cid:19)(cid:19)(cid:17)

(cid:18)(cid:18)(cid:13)(cid:20)(cid:17)(cid:21)

(cid:9)(cid:23)(cid:21)(cid:20)(cid:10)

(cid:9)(cid:19)(cid:13)(cid:23)(cid:20)(cid:21)(cid:10)

(cid:18)(cid:18)(cid:17)(cid:13)(cid:19)(cid:21)(cid:24)

(cid:24)(cid:23)(cid:13)(cid:26)(cid:21)(cid:19)

72,040

(cid:21)(cid:24)(cid:13)(cid:18)(cid:25)(cid:19)

37,626

(cid:19)(cid:13)(cid:25)(cid:23)(cid:25)

2,956

(cid:18)(cid:20)(cid:13)(cid:26)(cid:20)(cid:17)

5,304

(cid:18)(cid:21)(cid:17)(cid:13)(cid:26)(cid:19)(cid:19)

117,926

At 30th June 2014, properties with a net book value of £37,597,000 (2013: £25,825,000) were subject to a registered charge to secure the 
UK deﬁned beneﬁt pension scheme liabilities. 

Additions to assets in the course of construction of £24,240,000 (2013: £8,310,000) comprise £13,185,000 (2013: £1,208,000) for freehold land 
and buildings and £11,055,000 (2013: £7,102,000) for plant and equipment.

Year ended 30th June 2013

(cid:36)(cid:80)(cid:84)(cid:85)

At 1st July 2012

Additions

Transfers

Disposals

Currency adjustment

At 30th June 2013

(cid:37)(cid:70)(cid:81)(cid:83)(cid:70)(cid:68)(cid:74)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

At 1st July 2012

Charge for the year

Released on disposals

Currency adjustment

At 30th June 2013

(cid:47)(cid:70)(cid:85)(cid:1)(cid:67)(cid:80)(cid:80)(cid:76)(cid:1)(cid:87)(cid:66)(cid:77)(cid:86)(cid:70)

At 30th June 2013

At 30th June 2012

Plant and
equipment
£’000

Motor
vehicles
£’000

Assets in the
course of 
construction
£’000

Freehold
land and
buildings
£’000

85,854

5,690

1,742

–

(604)

96,615

12,696

5,260

(805)

685

92,682

114,451

18,738

1,762

–

142

69,580

7,544

(741)

442

Total
£’000

193,521

27,976

–

(1,511)

160

3,996

8,310

(7,002)

–

–

5,304

220,146

–

–

–

–

–

92,549

10,293

(1,248)

626

102,220

7,056

1,280

–

(706)

79

7,709

4,231

987

(507)

42

20,642

76,825

4,753

72,040

67,116

37,626

27,035

2,956

2,825

5,304

3,996

117,926

100,972

i

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104

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

(cid:18)(cid:17)(cid:15)(cid:1)(cid:42)(cid:79)(cid:85)(cid:66)(cid:79)(cid:72)(cid:74)(cid:67)(cid:77)(cid:70)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:36)(cid:80)(cid:84)(cid:85)

At 1st July 2013

Additions

Transfers

Disposals

Currency adjustment

(cid:34)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:34)(cid:78)(cid:80)(cid:83)(cid:85)(cid:74)(cid:84)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

At 1st July 2013

Charge for the year

Released on disposal

Currency adjustment

(cid:34)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:47)(cid:70)(cid:85)(cid:1)(cid:67)(cid:80)(cid:80)(cid:76)(cid:1)(cid:87)(cid:66)(cid:77)(cid:86)(cid:70)

(cid:34)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

At 30th June 2013

Year ended 30th June 2013

(cid:36)(cid:80)(cid:84)(cid:85)

At 1st July 2012

Additions

Transfers

Currency adjustment

At 30th June 2013

(cid:34)(cid:78)(cid:80)(cid:83)(cid:85)(cid:74)(cid:84)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

At 1st July 2012

Charge for the year

Currency adjustment

At 30th June 2013

(cid:47)(cid:70)(cid:85)(cid:1)(cid:67)(cid:80)(cid:80)(cid:76)(cid:1)(cid:87)(cid:66)(cid:77)(cid:86)(cid:70)

At 30th June 2013

At 30th June 2012

(cid:40)(cid:80)(cid:80)(cid:69)(cid:88)(cid:74)(cid:77)(cid:77)(cid:1)(cid:80)(cid:79)(cid:1)
(cid:68)(cid:80)(cid:79)(cid:84)(cid:80)(cid:77)(cid:74)(cid:69)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:48)(cid:85)(cid:73)(cid:70)(cid:83)
(cid:1)(cid:74)(cid:79)(cid:85)(cid:66)(cid:79)(cid:72)(cid:74)(cid:67)(cid:77)(cid:70)(cid:1)
(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:42)(cid:79)(cid:85)(cid:70)(cid:83)(cid:79)(cid:66)(cid:77)(cid:77)(cid:90)
(cid:72)(cid:70)(cid:79)(cid:70)(cid:83)(cid:66)(cid:85)(cid:70)(cid:69)
(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)
(cid:68)(cid:80)(cid:84)(cid:85)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:52)(cid:80)(cid:71)(cid:85)(cid:88)(cid:66)(cid:83)(cid:70)(cid:1)(cid:77)(cid:74)(cid:68)(cid:70)(cid:79)(cid:68)(cid:70)(cid:84)

(cid:42)(cid:79)(cid:1)(cid:86)(cid:84)(cid:70)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:42)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:68)(cid:80)(cid:86)(cid:83)(cid:84)(cid:70)(cid:1)
(cid:80)(cid:71)(cid:1)(cid:66)(cid:68)(cid:82)(cid:86)(cid:74)(cid:84)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:17)(cid:13)(cid:18)(cid:25)(cid:19)

(cid:21)(cid:23)(cid:26)

(cid:111)

(cid:111)

(cid:18)(cid:17)(cid:13)(cid:24)(cid:23)(cid:25)

(cid:111)

(cid:111)

(cid:111)

(cid:9)(cid:24)(cid:24)(cid:25)(cid:10)

(cid:9)(cid:18)(cid:19)(cid:21)(cid:10)

(cid:23)(cid:23)(cid:13)(cid:20)(cid:22)(cid:25)

(cid:18)(cid:18)(cid:13)(cid:25)(cid:20)(cid:17)

(cid:111)

(cid:111)

(cid:111)

(cid:19)(cid:17)(cid:13)(cid:18)(cid:22)(cid:19)

(cid:20)(cid:26)(cid:21)

(cid:22)(cid:20)

(cid:9)(cid:22)(cid:18)(cid:10)

(cid:9)(cid:20)(cid:26)(cid:10)

(cid:18)(cid:26)(cid:13)(cid:25)(cid:24)(cid:20)

(cid:18)(cid:17)(cid:13)(cid:23)(cid:21)(cid:21)

(cid:24)(cid:25)(cid:13)(cid:18)(cid:25)(cid:25)

(cid:19)(cid:17)(cid:13)(cid:22)(cid:17)(cid:26)

(cid:18)(cid:26)(cid:25)

(cid:111)

(cid:111)

(cid:111)

(cid:24)(cid:13)(cid:19)(cid:22)(cid:26)

(cid:18)(cid:13)(cid:20)(cid:26)(cid:24)

(cid:111)

(cid:9)(cid:19)(cid:22)(cid:10)

(cid:21)(cid:19)(cid:13)(cid:17)(cid:19)(cid:23)

(cid:25)(cid:13)(cid:20)(cid:21)(cid:22)

(cid:111)

(cid:111)

(cid:18)(cid:18)(cid:13)(cid:25)(cid:20)(cid:21)

(cid:18)(cid:13)(cid:24)(cid:20)(cid:19)

(cid:9)(cid:22)(cid:18)(cid:10)

(cid:9)(cid:20)(cid:23)(cid:10)

(cid:18)(cid:26)(cid:25)

(cid:25)(cid:13)(cid:23)(cid:20)(cid:18)

(cid:22)(cid:17)(cid:13)(cid:20)(cid:24)(cid:18)

(cid:18)(cid:20)(cid:13)(cid:21)(cid:24)(cid:26)

(cid:111)

(cid:25)(cid:26)

(cid:9)(cid:22)(cid:20)(cid:10)

(cid:111)

(cid:111)

(cid:20)(cid:23)

(cid:111)

(cid:111)

(cid:111)

(cid:111)

(cid:111)

(cid:18)(cid:18)(cid:24)(cid:13)(cid:21)(cid:23)(cid:17)

(cid:18)(cid:19)(cid:13)(cid:24)(cid:25)(cid:19)

(cid:111)

(cid:9)(cid:22)(cid:18)(cid:10)

(cid:9)(cid:26)(cid:21)(cid:18)(cid:10)

(cid:18)(cid:19)(cid:26)(cid:13)(cid:19)(cid:22)(cid:17)

(cid:23)(cid:18)(cid:13)(cid:20)(cid:18)(cid:24)

(cid:18)(cid:18)(cid:13)(cid:21)(cid:24)(cid:21)

(cid:9)(cid:22)(cid:18)(cid:10)

(cid:9)(cid:23)(cid:18)(cid:10)

(cid:24)(cid:19)(cid:13)(cid:23)(cid:24)(cid:26)

(cid:18)(cid:26)(cid:13)(cid:23)(cid:24)(cid:22)

19,984

(cid:19)(cid:13)(cid:17)(cid:18)(cid:20)

3,509

(cid:19)(cid:24)(cid:13)(cid:25)(cid:18)(cid:24)

24,332

(cid:24)(cid:13)(cid:17)(cid:20)(cid:17)

8,318

(cid:20)(cid:23)

–

(cid:22)(cid:23)(cid:13)(cid:22)(cid:24)(cid:18)

56,143

Goodwill on 
consolidation
£’000

Other
 intangible assets
£’000

Internally
generated
development 
costs
£’000

Software licences

In use
£’000

In the course 
of acquisition
£’000

19,414

10,347

403

–

365

373

–

48

55,743

10,615

–

–

19,652

449

32

19

20,182

10,768

66,358

20,152

198

 –

–

198

5,907

1,347

5

7,259

34,468

7,558

–

10,207

1,610

17

42,026

11,834

31

1

(32)

–

–

–

–

–

–

Total
£’000

105,187

11,841

–

432

117,460

50,780

10,515

22

61,317

19,984

19,216

3,509

4,440

24,332

21,275

8,318

9,445

–

31

56,143

54,407

105

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

(cid:18)(cid:17)(cid:15)(cid:1)(cid:42)(cid:79)(cid:85)(cid:66)(cid:79)(cid:72)(cid:74)(cid:67)(cid:77)(cid:70)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

Goodwill acquired has arisen on the acquisition of a number of businesses and has an indeterminable useful life. Therefore it is not amortised 
but is tested for impairment annually and at any point during the year when an indicator of impairment exists. Goodwill is allocated to the CGUs, 
which are currently the statutory entities acquired. This is the lowest level in the Group at which goodwill is monitored for impairment and is at a 
lower level than the Group’s operating segments. In the table below, only the goodwill relating to the acquisition of R&R Fixtures, LLC is 
expected to be subject to tax relief.

The analysis of acquired goodwill on consolidation is:

itp GmbH

Renishaw Diagnostics Limited (92.4%)

Renishaw Mayﬁeld S.A. (75%)

Measurement Devices Limited

Renishaw Software Limited

R&R Fixtures, LLC

Other smaller acquisitions

Total acquired goodwill

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:13)(cid:24)(cid:24)(cid:17)

(cid:18)(cid:13)(cid:24)(cid:25)(cid:21)

(cid:18)(cid:13)(cid:21)(cid:25)(cid:24)

(cid:23)(cid:13)(cid:23)(cid:23)(cid:18)

(cid:18)(cid:13)(cid:22)(cid:22)(cid:26)

(cid:21)(cid:13)(cid:17)(cid:22)(cid:17)

(cid:18)(cid:13)(cid:20)(cid:23)(cid:21)

2013
£’000

2,960

1,784

1,569

6,661

1,559

4,556

895

(cid:18)(cid:26)(cid:13)(cid:23)(cid:24)(cid:22)

19,984

The recoverable amounts of acquired goodwill are based on value in use calculations. These calculations use cash ﬂow projections with 
assumptions as follows: 

(cid:116)(cid:1)(cid:1)(cid:74)(cid:85)(cid:81)(cid:1)(cid:40)(cid:78)(cid:67)(cid:41)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:52)(cid:80)(cid:71)(cid:85)(cid:88)(cid:66)(cid:83)(cid:70)(cid:1)(cid:45)(cid:74)(cid:78)(cid:74)(cid:85)(cid:70)(cid:69)(cid:1)(cid:9)(cid:67)(cid:80)(cid:85)(cid:73)(cid:1)(cid:81)(cid:66)(cid:83)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:78)(cid:70)(cid:85)(cid:83)(cid:80)(cid:77)(cid:80)(cid:72)(cid:90)(cid:1)(cid:84)(cid:70)(cid:72)(cid:78)(cid:70)(cid:79)(cid:85)(cid:10)(cid:1)(cid:111)(cid:1)(cid:66)(cid:68)(cid:85)(cid:86)(cid:66)(cid:77)(cid:1)(cid:80)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:83)(cid:70)(cid:84)(cid:86)(cid:77)(cid:85)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:79)(cid:1)(cid:66)(cid:87)(cid:70)(cid:83)(cid:66)(cid:72)(cid:70)(cid:1)(cid:72)(cid:83)(cid:80)(cid:88)(cid:85)(cid:73)(cid:1)(cid:83)(cid:66)(cid:85)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)

5% for ﬁve years with a nil growth rate to perpetuity (2013: same basis). 

(cid:116)(cid:1)(cid:1)(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:37)(cid:74)(cid:66)(cid:72)(cid:79)(cid:80)(cid:84)(cid:85)(cid:74)(cid:68)(cid:84)(cid:1)(cid:45)(cid:74)(cid:78)(cid:74)(cid:85)(cid:70)(cid:69)(cid:13)(cid:1)(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:46)(cid:66)(cid:90)(cid:109)(cid:70)(cid:77)(cid:69)(cid:1)(cid:52)(cid:15)(cid:34)(cid:15)(cid:1)(cid:9)(cid:67)(cid:80)(cid:85)(cid:73)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:73)(cid:70)(cid:66)(cid:77)(cid:85)(cid:73)(cid:68)(cid:66)(cid:83)(cid:70)(cid:1)(cid:84)(cid:70)(cid:72)(cid:78)(cid:70)(cid:79)(cid:85)(cid:10)(cid:13)(cid:1)(cid:46)(cid:70)(cid:66)(cid:84)(cid:86)(cid:83)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:37)(cid:70)(cid:87)(cid:74)(cid:68)(cid:70)(cid:84)(cid:1)(cid:45)(cid:74)(cid:78)(cid:74)(cid:85)(cid:70)(cid:69)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:51)(cid:7)(cid:51)(cid:248)(cid:39)(cid:74)(cid:89)(cid:85)(cid:86)(cid:83)(cid:70)(cid:84)(cid:13)(cid:1)

LLC (both in the metrology segment) – ﬁve-year business plans with a nil growth rate to perpetuity (2013: same basis).

These are considered prudent estimates based on management’s view of the future and experience of past performance. The growth rates 
used in the business plans vary from 20% to 34%, except for Renishaw Diagnostics Limited, which is in its research and development phase 
and thus has negligible revenue to date. 

A pre-tax discount rate of 12% has been used in discounting the projected cash ﬂows of itp GmbH, Renishaw Software Limited, Measurement 
Devices Limited and R&R Fixtures, LLC (2013: 12%). A pre-tax discount rate of 15% has been used for Renishaw Diagnostics Limited and 
Renishaw Mayﬁeld S.A. (2013: 15%). The discount rates have been derived by comparison with rates adopted by other market participants, 
adjusted to reﬂect Group and CGU speciﬁc risks. On this basis, no impairment write-downs are required.

There is signiﬁcant headroom in all the above and for an impairment to arise, there would need to be a signiﬁcant material deterioration in 
business; this is considered to be remote. An increase of 5% in the discount rate would not result in an impairment. For goodwill to be impaired 
in the CGU with the minimum headroom, the discount rate would have to increase to 32%.

(cid:18)(cid:18)(cid:15)(cid:1)(cid:42)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:74)(cid:79)(cid:1)(cid:66)(cid:84)(cid:84)(cid:80)(cid:68)(cid:74)(cid:66)(cid:85)(cid:70)(cid:84)

The Group has the following investments in associates (all investments being in the ordinary share capital of the associate), whose accounting 
years end on 30th June:

RLS merilna tehnika d.o.o.

Metrology Software Products Limited

During the year, the Group disposed of its 20% shareholding in Delcam plc. 

Country of
incorporation

Slovenia

England & Wales

(cid:48)(cid:88)(cid:79)(cid:70)(cid:83)(cid:84)(cid:73)(cid:74)(cid:81)
(cid:19)(cid:17)(cid:18)(cid:21)
(cid:6)

Ownership
2013
%

(cid:22)(cid:17)

(cid:22)(cid:17)

50

50

S
t
r
a
t
e
g
c

i

r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e

i

F
n
a
n
c
a

i

l

s
t
a
t
e
m
e
n
t
s

S
h
a
r
e
h
o
d
e
r

l

i

f

n
o
r
m
a
t
i
o
n

 
 
 
106

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

(cid:18)(cid:18)(cid:15)(cid:1)(cid:42)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:74)(cid:79)(cid:1)(cid:66)(cid:84)(cid:84)(cid:80)(cid:68)(cid:74)(cid:66)(cid:85)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

Movements during the year were:

Balance at the beginning of the year

Dividends received

Share of proﬁts of associates

Amortisation of intangibles

Disposal of shareholding in Delcam plc

Other comprehensive income and expense

Balance at the end of the year

Summarised aggregated ﬁnancial information for associates:

Revenue

Share of proﬁts for the year

Assets

Liabilities

(cid:18)(cid:19)(cid:15)(cid:1)(cid:34)(cid:68)(cid:82)(cid:86)(cid:74)(cid:84)(cid:74)(cid:85)(cid:74)(cid:80)(cid:79)(cid:84)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:24)(cid:13)(cid:21)(cid:17)(cid:20)

(cid:9)(cid:19)(cid:18)(cid:17)(cid:10)

(cid:26)(cid:22)(cid:17)

(cid:9)(cid:18)(cid:24)(cid:22)(cid:10)

(cid:9)(cid:22)(cid:13)(cid:24)(cid:20)(cid:25)(cid:10)

(cid:111)

(cid:19)(cid:13)(cid:19)(cid:20)(cid:17)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:26)(cid:13)(cid:19)(cid:24)(cid:25)

(cid:26)(cid:22)(cid:17)

(cid:21)(cid:13)(cid:18)(cid:24)(cid:19)

(cid:19)(cid:13)(cid:19)(cid:22)(cid:25)

2013
£’000

6,790

(307)

1,345

(323)

–

(102)

7,403

2013
£’000

13,545

1,345

11,882

5,976

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)
There were no signiﬁcant acquisitions in the year. In March 2014, the Group purchased Advanced Consulting and Engineering, Inc, which 
resulted in goodwill of £469,000.

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:20)
There were no signiﬁcant acquisitions in the year. In May 2013, the Group purchased certain business assets of LBC LaserBearbeitungsCenter 
GmbH, resulting in goodwill of £403,000.

(cid:18)(cid:20)(cid:15)(cid:1)(cid:37)(cid:70)(cid:71)(cid:70)(cid:83)(cid:83)(cid:70)(cid:69)(cid:1)(cid:85)(cid:66)(cid:89)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

Balances at the end of the year were:

Property, plant and equipment

Intangible assets

Intragroup trading (inventory)

Pension schemes

Other

Balance at the end of the year

(cid:34)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:111)

(cid:111)

(cid:24)(cid:13)(cid:19)(cid:19)(cid:21)

(cid:25)(cid:13)(cid:18)(cid:21)(cid:18)

(cid:25)(cid:17)(cid:25)

(cid:18)(cid:23)(cid:13)(cid:18)(cid:24)(cid:20)

(cid:19)(cid:17)(cid:18)(cid:21)

(cid:45)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:9)(cid:21)(cid:13)(cid:21)(cid:20)(cid:26)(cid:10)

(cid:9)(cid:24)(cid:13)(cid:24)(cid:19)(cid:21)(cid:10)

(cid:111)

(cid:111)

(cid:9)(cid:18)(cid:18)(cid:13)(cid:19)(cid:25)(cid:18)(cid:10)

(cid:9)(cid:19)(cid:20)(cid:13)(cid:21)(cid:21)(cid:21)(cid:10)

(cid:47)(cid:70)(cid:85)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:9)(cid:21)(cid:13)(cid:21)(cid:20)(cid:26)(cid:10)

(cid:9)(cid:24)(cid:13)(cid:24)(cid:19)(cid:21)(cid:10)

(cid:24)(cid:13)(cid:19)(cid:19)(cid:21)

(cid:25)(cid:13)(cid:18)(cid:21)(cid:18)

(cid:9)(cid:18)(cid:17)(cid:13)(cid:21)(cid:24)(cid:20)(cid:10)

(cid:9)(cid:24)(cid:13)(cid:19)(cid:24)(cid:18)(cid:10)

Assets
£’000

–

–

8,415

8,973

888

18,276

2013

Liabilities
£’000

(4,678)

(8,445)

–

–

(6,909)

(20,032)

Net
£’000

(4,678)

(8,445)

8,415

8,973

(6,021)

(1,756)

107

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

S
t
r
a
t
e
g
c

i

r
e
p
o
r
t

G
o
v
e
r
n
a
n
c
e

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:9)(cid:18)(cid:13)(cid:24)(cid:22)(cid:23)(cid:10)

(cid:18)(cid:13)(cid:23)(cid:18)(cid:24)

(cid:9)(cid:23)(cid:13)(cid:23)(cid:17)(cid:19)(cid:10)

(cid:9)(cid:22)(cid:20)(cid:17)(cid:10)

(cid:9)(cid:24)(cid:13)(cid:18)(cid:20)(cid:19)(cid:10)

(cid:9)(cid:24)(cid:13)(cid:19)(cid:24)(cid:18)(cid:10)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:20)(cid:26)

(cid:24)(cid:19)(cid:18)

(cid:9)(cid:18)(cid:13)(cid:18)(cid:26)(cid:18)(cid:10)

(cid:9)(cid:20)(cid:17)(cid:18)(cid:10)

(cid:19)(cid:13)(cid:18)(cid:21)(cid:26)

(cid:18)(cid:13)(cid:23)(cid:18)(cid:24)

2013
£’000

(1,715)

(1,473)

1,005

427

1,432

(1,756)

2013
£’000

(117)

(815)

1,154

(974)

(721)

(1,473)

(cid:18)(cid:20)(cid:15)(cid:1)(cid:37)(cid:70)(cid:71)(cid:70)(cid:83)(cid:83)(cid:70)(cid:69)(cid:1)(cid:85)(cid:66)(cid:89)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

The movements in the deferred tax balance during the year were:

Balance at the beginning of the year

Movements in the Consolidated income statement

Movement in relation to the cash ﬂow hedging reserve

Movement in relation to the pension schemes

Total movement in the Consolidated statement of comprehensive income and expense

Balance at the end of the year

The deferred tax movement in the Consolidated income statement is analysed as:

Property, plant and equipment

Intangible assets

Intragroup trading (inventory)

Pension schemes

Other

Total movement for the year

No deferred tax asset has been recognised in respect of tax losses carried forward of £10,675,000 (2013: £10,113,000) due to the uncertainty 
over their recoverability, as a signiﬁcant proportion may only be carried forward for a limited period of time. 

(cid:18)(cid:21)(cid:15)(cid:1)(cid:37)(cid:70)(cid:83)(cid:74)(cid:87)(cid:66)(cid:85)(cid:74)(cid:87)(cid:70)(cid:84)

Derivatives comprising the fair value of outstanding forward contracts with positive fair values are shown within:

Non-current assets

Current assets

Total of derivatives with positive fair values

Derivatives comprising the fair value of outstanding forward contracts with negative fair values are shown within:

Non-current liabilities

Current liabilities

Total of derivatives with negative fair values

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:25)(cid:13)(cid:23)(cid:21)(cid:21)

(cid:18)(cid:20)(cid:13)(cid:20)(cid:21)(cid:25)

(cid:20)(cid:18)(cid:13)(cid:26)(cid:26)(cid:19)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:24)

(cid:111)

(cid:18)(cid:24)

2013
£’000

7,976

3,583

11,559

2013
£’000

10,442

2,018

12,460

i

F
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a
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c
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l

s
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m
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S
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108

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

15. Employee benefits

The Group operates a number of pension schemes throughout the world. As noted in the accounting policies, actuarial valuations of foreign 
pension schemes are not obtained for the most part because of the limited number of foreign employees. 

The major scheme, which covers the UK-based employees, was of the deﬁned beneﬁt type. This scheme, along with the Ireland and USA 
deﬁned beneﬁt schemes, has ceased any future accrual for current members and these schemes are closed to new members. UK, Ireland 
and USA employees are now covered by deﬁned contribution schemes.

The total pension cost of the Group for the year was £13,246,000 (2013: £11,273,000), of which £182,000 (2013: £169,000) related to directors 
and £3,537,000 (2013: £4,482,000) related to overseas schemes. 

The latest full actuarial valuation of the UK deﬁned beneﬁt scheme was carried out at September 2012 and updated to 30th June 2014 by 
a qualiﬁed independent actuary. The mortality assumption used for 2014 is S1PMA and S1PFA tables, CMI (core) 2011 model with long-term 
improvements of 1% per annum.

The major assumptions used by the actuary for the UK and Ireland schemes were:

Rate of increase in pension payments

Discount rate

Inﬂation rate (RPI)

Inﬂation rate (CPI)

Retirement age

(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

30th June 2013

30th June 2012

(cid:54)(cid:44)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)

(cid:42)(cid:83)(cid:70)(cid:77)(cid:66)(cid:79)(cid:69)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)

UK scheme

Ireland scheme

UK scheme

Ireland scheme

(cid:20)(cid:15)(cid:22)(cid:6)

(cid:21)(cid:15)(cid:21)(cid:6)

(cid:20)(cid:15)(cid:24)(cid:6)

(cid:19)(cid:15)(cid:24)(cid:6)

(cid:23)(cid:21)

(cid:18)(cid:15)(cid:26)(cid:6)

(cid:19)(cid:15)(cid:24)(cid:6)

(cid:18)(cid:15)(cid:26)(cid:6)

(cid:111)

(cid:23)(cid:22)

3.5%

4.8%

3.7%

2.7%

64

2.5%

3.6%

2.5%

–

65

2.7%

4.3%

2.7%

1.7%

64

1.7%

3.4%

1.7%

–

65

The assets and liabilities in the deﬁned beneﬁt schemes were:

Market value of assets:

Equities

Bonds and cash

(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)
(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

% of
total
assets

30th June
2013
£’000

% of
total
assets

30th June
2012
£’000

% of
total
assets

30th June
2011
£’000

% of
total
assets

30th June
2010
£’000

% of
total
assets

(cid:18)(cid:19)(cid:24)(cid:13)(cid:25)(cid:17)(cid:22)

(cid:18)(cid:13)(cid:26)(cid:22)(cid:17)

98

2

117,114

1,653

99

1

93,827

1,409

99

1

99,365

1,684

98

2

81,737

1,447

98

2

(cid:18)(cid:19)(cid:26)(cid:13)(cid:24)(cid:22)(cid:22)

100

118,767

100

95,236

100

101,049

100

83,184

100

Actuarial value of liabilities

Deﬁcit in the schemes

Deferred tax thereon

(cid:9)(cid:18)(cid:24)(cid:19)(cid:13)(cid:25)(cid:19)(cid:20)(cid:10)

(cid:9)(cid:21)(cid:20)(cid:13)(cid:17)(cid:23)(cid:25)(cid:10)

(cid:25)(cid:13)(cid:18)(cid:21)(cid:18)

(160,485)

(41,718)

8,973

–

–

–

(137,224)

(41,988)

9,519

–

–

–

(138,713)

(37,664)

9,393

–

–

–

(120,435)

(37,251)

9,694

–

–

–

Note C.36 gives the analysis of the UK deﬁned beneﬁt pension scheme. For the other schemes, the market value of assets at the end of the year 
was £12,752,000 (2013: £12,349,000) and the actuarial value of liabilities was £18,544,000 (2013: £17,500,000).

For a sensitivity analysis of certain elements of the UK deﬁned beneﬁt pension scheme, see the note in the ﬁnancial review section of 
the Strategic report. It is expected that contributions to deﬁned beneﬁt schemes for the next ﬁnancial year will be at a similar level to the 
current year.

The movements in the schemes’ assets and liabilities were:

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

Balance at the beginning of the year

Contributions paid

Interest on pension schemes

Remeasurement gain/(loss)

Beneﬁts received/(paid)

Balance at the end of the year

(cid:34)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:45)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:18)(cid:25)(cid:13)(cid:24)(cid:23)(cid:24)

(cid:9)(cid:18)(cid:23)(cid:17)(cid:13)(cid:21)(cid:25)(cid:22)(cid:10)

(cid:9)(cid:21)(cid:18)(cid:13)(cid:24)(cid:18)(cid:25)(cid:10)

(cid:19)(cid:13)(cid:19)(cid:24)(cid:22)

(cid:26)(cid:13)(cid:19)(cid:18)(cid:20)

(cid:18)(cid:13)(cid:25)(cid:25)(cid:24)

(cid:9)(cid:19)(cid:13)(cid:20)(cid:25)(cid:24)(cid:10)

(cid:111)

(cid:9)(cid:18)(cid:17)(cid:13)(cid:23)(cid:17)(cid:22)(cid:10)

(cid:9)(cid:21)(cid:13)(cid:18)(cid:19)(cid:17)(cid:10)

(cid:19)(cid:13)(cid:20)(cid:25)(cid:24)

(cid:19)(cid:13)(cid:19)(cid:24)(cid:22)

(cid:9)(cid:18)(cid:13)(cid:20)(cid:26)(cid:19)(cid:10)

(cid:9)(cid:19)(cid:13)(cid:19)(cid:20)(cid:20)(cid:10)

(cid:111)

(cid:18)(cid:19)(cid:26)(cid:13)(cid:24)(cid:22)(cid:22)

(cid:9)(cid:18)(cid:24)(cid:19)(cid:13)(cid:25)(cid:19)(cid:20)(cid:10)

(cid:9)(cid:21)(cid:20)(cid:13)(cid:17)(cid:23)(cid:25)(cid:10)

109

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Assets
£’000

95,236

2,508

7,799

4,763

10,243

(1,782)

Liabilities
£’000

Total
£’000

(137,224)

(41,988)

–

(9,177)

(5,831)

(10,035)

1,782

2,508

(1,378)

(1,068)

208

–

118,767

(160,485)

(41,718)

15. Employee benefits continued

Year ended 30th June 2013 (restated)

Balance at the beginning of the year

Contributions paid

Interest on pension schemes

Opening amounts for USA scheme

Remeasurement gain/(loss)

Beneﬁts received/(paid)

Balance at the end of the year

The analysis of the amount recognised in the Consolidated statement of comprehensive income and expense was:

Actuarial (loss)/gain arising from:

– Changes in demographic assumptions

– Changes in ﬁnancial assumptions

– Experience adjustment

Return on plan assets excluding interest income

Adjustment to liabilities for IFRIC 14

Total amount in respect of the current year

Inclusion of the USA scheme opening balance

Total amount recognised in the Consolidated statement of comprehensive income and expense

The history of experience gains and losses is:

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:9)(cid:19)(cid:13)(cid:23)(cid:20)(cid:19)(cid:10)

(cid:9)(cid:18)(cid:19)(cid:13)(cid:19)(cid:21)(cid:19)(cid:10)

(cid:20)(cid:13)(cid:22)(cid:20)(cid:20)

(cid:23)(cid:13)(cid:25)(cid:17)(cid:25)

(cid:19)(cid:13)(cid:20)(cid:17)(cid:17)

(cid:9)(cid:19)(cid:13)(cid:19)(cid:20)(cid:20)(cid:10)

(cid:111)

(cid:9)(cid:19)(cid:13)(cid:19)(cid:20)(cid:20)(cid:10)

Restated
2013
£’000

–

(12,757)

(182)

13,747

(600)

208

(1,068)

(860)

(cid:37)(cid:74)(cid:71)(cid:71)(cid:70)(cid:83)(cid:70)(cid:79)(cid:68)(cid:70)(cid:1)(cid:67)(cid:70)(cid:85)(cid:88)(cid:70)(cid:70)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:68)(cid:85)(cid:70)(cid:69)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:68)(cid:85)(cid:86)(cid:66)(cid:77)(cid:1)
(cid:83)(cid:70)(cid:85)(cid:86)(cid:83)(cid:79) (cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)
amount (£’000)

percentage of scheme assets

(cid:38)(cid:89)(cid:81)(cid:70)(cid:83)(cid:74)(cid:70)(cid:79)(cid:68)(cid:70)(cid:1)(cid:72)(cid:66)(cid:74)(cid:79)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:77)(cid:80)(cid:84)(cid:84)(cid:70)(cid:84)(cid:1)(cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

amount (£’000)

percentage of present value of scheme liabilities
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:66)(cid:78)(cid:80)(cid:86)(cid:79)(cid:85)(cid:1)(cid:83)(cid:70)(cid:68)(cid:80)(cid:72)(cid:79)(cid:74)(cid:84)(cid:70)(cid:69)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:36)(cid:80)(cid:79)(cid:84)(cid:80)(cid:77)(cid:74)(cid:69)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)
(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:83)(cid:70)(cid:73)(cid:70)(cid:79)(cid:84)(cid:74)(cid:87)(cid:70)(cid:1)(cid:74)(cid:79)(cid:68)(cid:80)(cid:78)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:79)(cid:84)(cid:70)

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)
(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

Year ended
30th June 2013

Year ended
30th June 2012

Year ended
30th June 2011

Year ended
30th June 2010

(cid:23)(cid:13)(cid:22)(cid:20)(cid:22)

(cid:22)(cid:6)

(cid:19)(cid:13)(cid:25)(cid:19)(cid:25)

(cid:19)(cid:6)

13,474

11%

1,089

1%

(13,266)

(14%)

–

–

11,773

12%

(1,521)

(1%)

9,920

12%

915

1%

amount (£’000)

percentage of present value of scheme liabilities

(cid:9)(cid:19)(cid:13)(cid:19)(cid:20)(cid:20)(cid:10)

(cid:18)(cid:6)

(860)

(1%)

(7,781)

(6%)

(1,577)

(1%)

(14,867)

(12%)

The cumulative amount of actuarial gains and losses recognised in the Consolidated statement of comprehensive income and expense was 
a loss of £78,756,000 (2013: loss of £76,523,000).

S
t
r
a
t
e
g
c

i

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e
p
o
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t

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o
v
e
r
n
a
n
c
e

i

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n
a
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c
a

i

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s
t
a
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m
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s

S
h
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110

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

15. Employee benefits continued

The assumptions used for mortality rates for members, medium cohort at the expected retirement age of 65 years are:

Male currently aged 65

Female currently aged 65

Male currently aged 45

Female currently aged 45

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:90)(cid:70)(cid:66)(cid:83)(cid:84)

(cid:19)(cid:19)(cid:15)(cid:18)

(cid:19)(cid:21)(cid:15)(cid:25)

(cid:19)(cid:20)(cid:15)(cid:21)

(cid:19)(cid:23)(cid:15)(cid:18)

2013
years

22.0

24.2

23.1

25.1

Under the UK and Ireland deﬁned beneﬁt pension scheme deﬁcit funding plans, there are certain UK properties, owned by the Company, 
and a property owned by Renishaw (Ireland) Limited, which are subject to registered ﬁxed charges to secure the UK and Ireland deﬁned beneﬁt 
pension schemes’ deﬁcits respectively. The Company has also established an escrow account, which is subject to a registered ﬂoating charge 
to secure the UK deﬁned beneﬁt pension scheme liabilities. The balance of this account was £9,541,000 at the end of the year 
(2013: £10,982,000).

The Company has given a guarantee relating to recovery plans for the UK deﬁned beneﬁt pension scheme and the trustees have the right 
to enforce the charges to recover any deﬁcit up to £40,830,000 if an insolvency event occurs in relation to the Company before 1st November 
2016 or if the Company has not made good any deﬁcit up to £40,830,000 by midnight on 1st November 2016. No scheme assets are invested 
in the Group’s own equity.

The value of the guarantee discussed above is greater than the value of the pension scheme’s deﬁcit. As such, in line with IFRIC 14, 
the UK deﬁned beneﬁt pension scheme’s liabilities have been increased by £8,000,000, to represent the maximum discounted liability 
as at 30th June 2014 (2013: £10,300,000).

(cid:18)(cid:23)(cid:15)(cid:1)(cid:42)(cid:79)(cid:87)(cid:70)(cid:79)(cid:85)(cid:80)(cid:83)(cid:74)(cid:70)(cid:84)

An analysis of inventories at the end of the year was:

Raw materials

Work in progress

Finished goods

Balance at the end of the year

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:19)(cid:13)(cid:24)(cid:26)(cid:22)

(cid:18)(cid:22)(cid:13)(cid:20)(cid:20)(cid:25)

(cid:19)(cid:21)(cid:13)(cid:25)(cid:21)(cid:23)

(cid:23)(cid:19)(cid:13)(cid:26)(cid:24)(cid:26)

2013
£’000

25,067

15,415

24,786

65,268

During the year, the amount of inventories recognised as an expense in the Consolidated income statement was £114,597,000  
(2013: £104,881,000) and the amount of write-down of inventories recognised as an expense in the Consolidated income statement was 
£1,017,000 (2013: £397,000).

(cid:18)(cid:24)(cid:15)(cid:1)(cid:36)(cid:66)(cid:84)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:66)(cid:84)(cid:73)(cid:1)(cid:70)(cid:82)(cid:86)(cid:74)(cid:87)(cid:66)(cid:77)(cid:70)(cid:79)(cid:85)(cid:84)

An analysis of cash and cash equivalents at the end of the year was:

Bank balances and cash in hand

Short-term deposits

Balance at the end of the year

The UK deﬁned beneﬁt pension scheme cash escrow account is shown separately within current assets.

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:26)(cid:13)(cid:26)(cid:26)(cid:20)

(cid:20)(cid:20)(cid:13)(cid:23)(cid:21)(cid:18)

(cid:21)(cid:20)(cid:13)(cid:23)(cid:20)(cid:21)

2013
£’000

13,641

12,964

26,605

111

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:13)(cid:23)(cid:20)(cid:17)

(cid:21)(cid:22)(cid:25)

(cid:9)(cid:24)(cid:26)(cid:21)(cid:10)

(cid:9)(cid:20)(cid:20)(cid:23)(cid:10)

(cid:18)(cid:13)(cid:19)(cid:26)(cid:21)

2013
£’000

1,170

826

(366)

460

1,630

(cid:18)(cid:25)(cid:15)(cid:1)(cid:49)(cid:83)(cid:80)(cid:87)(cid:74)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)

(cid:56)(cid:66)(cid:83)(cid:83)(cid:66)(cid:79)(cid:85)(cid:90)(cid:1)(cid:81)(cid:83)(cid:80)(cid:87)(cid:74)(cid:84)(cid:74)(cid:80)(cid:79)
Movements during the year were:

Balance at the beginning of the year

Created during the year

Utilised in the year

Balance at the end of the year

The warranty provision has been calculated on the basis of historical return-in-warranty information and other internal reports. It is expected 
that most of this expenditure will be incurred in the next ﬁnancial year and all expenditure will be incurred within three years of the balance 
sheet date.

(cid:18)(cid:26)(cid:15)(cid:1)(cid:48)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:81)(cid:66)(cid:90)(cid:66)(cid:67)(cid:77)(cid:70)(cid:84)

Balances at the end of the year were:

Payroll taxes and social security

Other creditors and accruals

Total other payables

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:21)(cid:13)(cid:18)(cid:22)(cid:20)

(cid:18)(cid:18)(cid:13)(cid:26)(cid:22)(cid:24)

(cid:18)(cid:23)(cid:13)(cid:18)(cid:18)(cid:17)

2013
£’000

3,712

15,305

19,017

The Group’s exposure to currency and liquidity risk related to trade and other payables is disclosed in note 22. Included in other creditors 
and accruals is £283,000 (2013: £988,000) in respect of deferred consideration.

(cid:19)(cid:17)(cid:15)(cid:1)(cid:48)(cid:85)(cid:73)(cid:70)(cid:83)(cid:1)(cid:81)(cid:66)(cid:90)(cid:66)(cid:67)(cid:77)(cid:70)(cid:84)(cid:1)(cid:9)(cid:79)(cid:80)(cid:79)(cid:14)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:10)

The deferred consideration of £883,000 is in respect of investments in subsidiaries, which is payable over the next three years (2013: £1,589,000).

(cid:19)(cid:18)(cid:15)(cid:1)(cid:36)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:83)(cid:70)(cid:84)(cid:70)(cid:83)(cid:87)(cid:70)(cid:84)

(cid:52)(cid:73)(cid:66)(cid:83)(cid:70)(cid:1)(cid:68)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)

(cid:34)(cid:77)(cid:77)(cid:80)(cid:85)(cid:85)(cid:70)(cid:69)(cid:13)(cid:1)(cid:68)(cid:66)(cid:77)(cid:77)(cid:70)(cid:69)(cid:14)(cid:86)(cid:81)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:71)(cid:86)(cid:77)(cid:77)(cid:90)(cid:1)(cid:81)(cid:66)(cid:74)(cid:69)
72,788,543 ordinary shares of 20p each

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

2013
£’000

(cid:18)(cid:21)(cid:13)(cid:22)(cid:22)(cid:25)

14,558

The ordinary shares are the only class of share in the Company. Holders of ordinary shares are entitled to vote at general meetings of the 
Company and receive dividends as declared. The Articles of Association of the Company do not contain any restrictions on the transfer 
of shares nor on voting rights.

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:68)(cid:90)(cid:1)(cid:85)(cid:83)(cid:66)(cid:79)(cid:84)(cid:77)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:83)(cid:70)(cid:84)(cid:70)(cid:83)(cid:87)(cid:70)
The currency translation reserve comprises all foreign exchange differences arising from the translation of the ﬁnancial statements of the 
foreign operations, offset by foreign exchange differences on bank liabilities which have been accounted for directly in equity on account of 
them being classiﬁed as hedging items. The movement in the year of a loss of £5,754,000 (2013: gain £346,000) comprises a loss on the net 
assets of foreign currency operations of £11,307,000 (2013: gain £193,000) and a gain on foreign currency bank accounts of £5,553,000 
(2013: gain £153,000).

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112

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

(cid:19)(cid:18)(cid:15)(cid:1)(cid:36)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:83)(cid:70)(cid:84)(cid:70)(cid:83)(cid:87)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)
(cid:36)(cid:66)(cid:84)h fl(cid:80)(cid:88)(cid:1)(cid:73)(cid:70)(cid:69)(cid:72)(cid:74)(cid:79)(cid:72)(cid:1)(cid:83)(cid:70)(cid:84)(cid:70)(cid:83)(cid:87)(cid:70)
The cash ﬂow hedging reserve comprises all foreign exchange differences arising from the valuation of forward exchange contracts which are 
effective hedges and mature after the year end. These are valued on a mark-to-market basis, are accounted for directly in equity and are 
recycled through the Consolidated income statement when the hedged item affects the Consolidated income statement. The forward contracts 
mature over the next three and a half years.

Movements during the year were:

Balance at the beginning of the year

Amounts transferred to the Consolidated income statement (within revenue)

Revaluations during the year

Deferred tax movement

Balance at the end of the year

(cid:37)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)(cid:84)(cid:1)(cid:81)(cid:66)(cid:74)(cid:69)
Dividends paid comprised:

2013 ﬁnal dividend paid of 28.67p per share (2012: 28.2p)

Interim dividend paid of 11.33p per share (2013: 11.33p)

Total dividends paid

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:9)(cid:23)(cid:26)(cid:21)(cid:10)

(cid:9)(cid:18)(cid:13)(cid:22)(cid:23)(cid:22)(cid:10)

(cid:20)(cid:21)(cid:13)(cid:21)(cid:21)(cid:18)

(cid:9)(cid:23)(cid:13)(cid:23)(cid:17)(cid:19)(cid:10)

(cid:19)(cid:22)(cid:13)(cid:22)(cid:25)(cid:17)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:17)(cid:13)(cid:25)(cid:23)(cid:25)

(cid:25)(cid:13)(cid:19)(cid:21)(cid:24)

(cid:19)(cid:26)(cid:13)(cid:18)(cid:18)(cid:22)

2013
£’000

2,526

(2,106)

(2,119)

1,005

(694)

2013
£’000

20,526

8,247

28,773

A ﬁnal dividend in respect of the current ﬁnancial year of £21,741,938 (2013: £20,868,475), at the rate of 29.87p net per share (2013: 28.67p) 
is proposed, to be paid on 20th October 2014 to shareholders on the register on 19th September 2014, with an ex-dividend date of 
17th September 2014.

(cid:47)(cid:80)(cid:79)(cid:14)(cid:68)(cid:80)(cid:79)(cid:85)(cid:83)(cid:80)(cid:77)(cid:77)(cid:74)(cid:79)(cid:72)(cid:1)(cid:74)(cid:79)(cid:85)(cid:70)(cid:83)(cid:70)(cid:84)(cid:85)
Movements during the year were:

Balance at the beginning of the year

Acquisition of further share in subsidiary

Share of loss for the year

Balance at the end of the year

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:9)(cid:18)(cid:13)(cid:20)(cid:20)(cid:21)(cid:10)

(cid:9)(cid:18)(cid:26)(cid:20)(cid:10)

(cid:9)(cid:22)(cid:21)(cid:26)(cid:10)

(cid:9)(cid:19)(cid:13)(cid:17)(cid:24)(cid:23)(cid:10)

2013
£’000

(741)

–

(593)

(1,334)

The non-controlling interest represents the minority shareholdings in Renishaw Diagnostics Limited – 7.6% and Renishaw Mayﬁeld S.A. – 25%. 
The previous year also included Renishaw Advanced Materials Limited – 45%, which shareholding was purchased during this ﬁnancial year.

113

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

(cid:19)(cid:19)(cid:15)(cid:1)(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:74)(cid:79)(cid:84)(cid:85)(cid:83)(cid:86)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)

The Group has exposure to credit risk, liquidity risk and market risk arising from its use of ﬁnancial instruments. This note presents information 
about the Group’s exposure to these risks, along with the Group’s objectives, policies and processes for measuring and managing the risks.

(cid:36)(cid:83)(cid:70)(cid:69)(cid:74)(cid:85)(cid:1)(cid:83)(cid:74)(cid:84)(cid:76)
The Group carries a credit risk, being the risk of non-payment of trade receivables by its customers. Credit evaluations are carried out on all new 
customers before credit is given above certain thresholds. There is a spread of risks among a large number of customers with no signiﬁcant 
concentration with one customer or in any one geographical area. The Group establishes an allowance for impairment in respect of trade 
receivables where recoverability is considered doubtful.

An analysis by currency of the Group’s ﬁnancial assets at the year end is as follows:

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:68)(cid:90)

Pound Sterling

US Dollar

Japanese Yen

Euro

Other

Trade receivables

Other receivables

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:26)(cid:13)(cid:17)(cid:26)(cid:24)

(cid:20)(cid:17)(cid:13)(cid:21)(cid:18)(cid:25)

(cid:24)(cid:13)(cid:17)(cid:26)(cid:20)

(cid:18)(cid:25)(cid:13)(cid:25)(cid:22)(cid:25)

(cid:18)(cid:23)(cid:13)(cid:20)(cid:20)(cid:19)

(cid:25)(cid:18)(cid:13)(cid:24)(cid:26)(cid:25)

2013
£’000

7,639

22,408

6,403

18,277

13,355

68,082

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:24)(cid:13)(cid:25)(cid:23)(cid:20)

(cid:18)(cid:22)(cid:13)(cid:23)(cid:26)(cid:23)

(cid:18)(cid:20)(cid:13)(cid:20)(cid:26)(cid:24)

(cid:21)(cid:13)(cid:17)(cid:22)(cid:22)

(cid:18)(cid:13)(cid:25)(cid:19)(cid:25)

(cid:21)(cid:19)(cid:13)(cid:25)(cid:20)(cid:26)

2013
£’000

7,566

305

11,510

1,428

1,621

22,430

Cash

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:17)(cid:19)(cid:13)(cid:18)(cid:18)(cid:20)

(cid:9)(cid:19)(cid:19)(cid:13)(cid:21)(cid:17)(cid:21)(cid:10)

(cid:9)(cid:26)(cid:13)(cid:17)(cid:22)(cid:17)(cid:10)

(cid:9)(cid:20)(cid:17)(cid:13)(cid:22)(cid:19)(cid:18)(cid:10)

(cid:20)(cid:13)(cid:21)(cid:26)(cid:23)

(cid:21)(cid:20)(cid:13)(cid:23)(cid:20)(cid:21)

2013
£’000

11,187

4,174

1,319

3,141

6,784

26,605

The above trade receivables, other receivables and cash are predominately held in the functional currency of the relevant entity, with the 
exception of £3,622,000 of Euro-denominated trade receivables being held in the Company, along with some foreign currency cash balances 
which are of a short-term nature. Also, see note below on net assets and associated borrowings, regarding the holding of foreign currency 
borrowings by the Company in respect of its hedging activity. 

The ageing of trade receivables past due, but not impaired, at the end of the year was:

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Past due 0–1 month

Past due 1–2 months

Past due more than 2 months

Balance at the end of the year

Movements in the provision for impairment of trade receivables during the year were:

Balance at the beginning of the year

Changes in amounts provided

Amounts utilised

Balance at the end of the year

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:20)(cid:13)(cid:25)(cid:22)(cid:21)

(cid:20)(cid:13)(cid:18)(cid:19)(cid:19)

(cid:18)(cid:13)(cid:26)(cid:17)(cid:20)

(cid:18)(cid:25)(cid:13)(cid:25)(cid:24)(cid:26)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:20)(cid:13)(cid:22)(cid:19)(cid:22)

(cid:9)(cid:25)(cid:26)(cid:10)

(cid:9)(cid:21)(cid:22)(cid:24)(cid:10)

(cid:19)(cid:13)(cid:26)(cid:24)(cid:26)

2013
£’000

9,412

3,860

2,931

16,203

2013
£’000

3,829

85

(389)

3,525

(cid:45)(cid:74)(cid:82)(cid:86)(cid:74)(cid:69)(cid:74)(cid:85)(cid:90)(cid:1)(cid:83)(cid:74)(cid:84)(cid:76)
The Group’s approach to managing liquidity is to ensure, as far as possible, that it will always have sufﬁcient liquidity to meet its liabilities when 
due, without incurring unacceptable losses or risking damage to the Group’s reputation. The Group is cash generative and uses monthly cash 
ﬂow forecasts to monitor cash requirements.

In respect of net cash, the carrying value approximates to fair value because of the short maturity of the deposits and borrowings. Interest rates 
are ﬂoating and based on LIBOR/LIBID, which can change over time, affecting the Group’s interest income. An increase of 1% in interest rates 
would result in an increase in interest income of approximately £400,000. The market value of forward exchange contracts is determined 
by reference to market data.

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114

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

(cid:19)(cid:19)(cid:15)(cid:1)(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:74)(cid:79)(cid:84)(cid:85)(cid:83)(cid:86)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

The contractual maturities of ﬁnancial liabilities at the year end were:

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

Trade payables

Other payables

Provisions

Forward exchange contracts

Year ended 30th June 2013

Trade payables

Other payables

Provisions

Forward exchange contracts

(cid:36)(cid:66)(cid:83)(cid:83)(cid:90)(cid:74)(cid:79)(cid:72)(cid:1)(cid:66)(cid:78)(cid:80)(cid:86)(cid:79)(cid:85)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:54)(cid:81)(cid:1)(cid:85)(cid:80)(cid:1)(cid:18)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:111)(cid:19)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)(cid:84)(cid:1)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:111)(cid:22)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:36)(cid:80)(cid:79)(cid:85)(cid:83)(cid:66)(cid:68)(cid:85)(cid:86)(cid:66)(cid:77)(cid:1)(cid:68)(cid:66)(cid:84)(cid:73)(cid:1)ﬂ(cid:80)(cid:88)(cid:84)

(cid:18)(cid:25)(cid:13)(cid:25)(cid:22)(cid:24)

(cid:18)(cid:23)(cid:13)(cid:26)(cid:26)(cid:20)

(cid:18)(cid:13)(cid:19)(cid:26)(cid:21)

(cid:18)(cid:24)

(cid:20)(cid:24)(cid:13)(cid:18)(cid:23)(cid:18)

(cid:18)(cid:25)(cid:13)(cid:25)(cid:22)(cid:24)

(cid:18)(cid:23)(cid:13)(cid:18)(cid:18)(cid:18)

(cid:18)(cid:13)(cid:19)(cid:26)(cid:21)

(cid:111)

(cid:20)(cid:23)(cid:13)(cid:19)(cid:23)(cid:19)

(cid:111)

(cid:20)(cid:24)(cid:24)

(cid:111)

(cid:111)

(cid:20)(cid:24)(cid:24)

(cid:111)

(cid:22)(cid:20)(cid:20)

–

(cid:18)(cid:24)

(cid:22)(cid:22)(cid:17)

Carrying amount
£’000

Up to 1 year
£’000

1–2 years 
£’000

2–5 years
£’000

18,481

20,606

1,630

12,460

53,177

18,481

19,039

1,630

2,018

41,168

–

580

–

2,869

3,449

–

1,181

–

7,573

8,754

For non-current other receivables of £18,644,000 (2013: £7,976,000), £11,884,000 (2013: £4,080,000) is receivable between 1 and 2 years and 
£6,760,000 (2013: £3,896,000) is receivable between 2 and 5 years.

There is no signiﬁcant difference between the fair value of ﬁnancial assets and ﬁnancial liabilities and their carrying value in the Consolidated 
balance sheet.

The fair values of the forward exchange contracts have been calculated by a third party expert, discounting estimated future cash ﬂows on the 
basis of market expectations of future exchange rates, representing level 2 in the IFRS 13 fair value hierarchy. The IFRS 13 level categorisation 
relates to the extent the fair value can be determined by reference to comparable market values. The classiﬁcations range from level 1 where 
instruments are quoted on an active market through to level 3 where the assumptions used to arrive at fair value do not have comparable 
market data. There are no other material ﬁnancial assets or liabilities that meet the criteria for disclosure under IFRS 13.

All ﬁnancial assets and liabilities are held at amortised cost, apart from the forward exchange contracts, which are held at fair value, with 
changes going through the Consolidated income statement unless subject to hedge accounting.

(cid:46)(cid:66)(cid:83)(cid:76)(cid:70)(cid:85)(cid:1)(cid:83)(cid:74)(cid:84)(cid:76)
As noted in the Strategic report under Principal risks and uncertainties, the Group operates in a number of foreign currencies with the majority 
of sales being made in these currencies but with most manufacturing being undertaken in the UK, Ireland and India.

(cid:38)(cid:89)(cid:68)(cid:73)(cid:66)(cid:79)(cid:72)(cid:70)(cid:1)(cid:83)(cid:66)(cid:85)(cid:70)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:84)(cid:70)(cid:79)(cid:84)(cid:74)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:90)(cid:1)(cid:66)(cid:79)(cid:66)(cid:77)(cid:90)(cid:84)(cid:74)(cid:84)
The Group has hedged a signiﬁcant proportion of its forecasted US Dollar, Japanese Yen and Euro cash ﬂows and hence the impact on the 
Group’s results resulting from ﬂuctuations in these exchange rates against Sterling is lessened.

The following are the exchange rates which have been applicable during the ﬁnancial year. Also noted is the increase in proﬁt that a one US 
Dollar cent change, a one Japanese Yen change and a one Euro cent change in exchange rate, where the foreign currency is strengthening 
against Sterling, might have on the Group’s results. The method of estimation involves assessing the impact of this currency on the Group’s 
transactions assuming all other variables are unchanged.

(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

         2013

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:68)(cid:90)

US Dollar

Japanese Yen

Euro

Average US Dollar forward contract rates

Average Japanese Yen forward contract rates

Average Euro forward contract rates

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:1)(cid:1)
(cid:70)(cid:89)(cid:68)(cid:73)(cid:66)(cid:79)(cid:72)(cid:70)(cid:1)(cid:1)

(cid:34)(cid:87)(cid:70)(cid:83)(cid:66)(cid:72)(cid:70)(cid:1)(cid:1)
(cid:70)(cid:89)(cid:68)(cid:73)(cid:66)(cid:79)(cid:72)(cid:70)(cid:1)(cid:1)

(cid:83)(cid:66)(cid:85)(cid:70)

(cid:18)(cid:15)(cid:24)(cid:18)

(cid:18)(cid:24)(cid:20)

(cid:18)(cid:15)(cid:19)(cid:22)

(cid:83)(cid:66)(cid:85)(cid:70)

(cid:18)(cid:15)(cid:23)(cid:21)

(cid:18)(cid:23)(cid:23)

(cid:18)(cid:15)(cid:19)(cid:17)

(cid:42)(cid:79)(cid:68)(cid:83)(cid:70)(cid:66)(cid:84)(cid:70)(cid:1)(cid:74)(cid:79)(cid:1)(cid:1)
(cid:72)(cid:83)(cid:80)(cid:86)(cid:81)(cid:1)(cid:81)(cid:83)(cid:80)ﬁ(cid:85)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)
(cid:80)(cid:79)(cid:70)(cid:1)(cid:68)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:83)(cid:1)(cid:1)
(cid:80)(cid:79)(cid:70)(cid:1)(cid:58)(cid:70)(cid:79)(cid:1)(cid:1)

(cid:78)(cid:80)(cid:87)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:20)(cid:17)(cid:17)

(cid:26)(cid:17)

(cid:18)(cid:18)(cid:17)

(cid:18)(cid:15)(cid:22)(cid:24)

(cid:18)(cid:19)(cid:23)

(cid:18)(cid:15)(cid:18)(cid:24)

Year end  
exchange  

Average  
exchange  

rate

1.52

151

1.17

–

–

–

rate

1.57

138

1.21

1.59

128

1.11

115

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

(cid:19)(cid:19)(cid:15)(cid:1)(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:74)(cid:79)(cid:84)(cid:85)(cid:83)(cid:86)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

The Company has US Dollar, Japanese Yen and Euro forward contracts which mature after the balance sheet date. The fair value of these 
contracts at the year end resulted in a proﬁt carried forward of £25,580,000 (2013: loss £694,000) (see note 21). The nominal amounts of foreign 
currencies relating to these forward contracts are, in Sterling terms, £245,824,000 in US Dollars (2013: £269,116,000), £47,087,000 in Japanese 
Yen (2013: £67,041,000) and £121,326,000 in Euro (2013: £112,826,000).

The Group classiﬁes its forward contracts hedging forecasted transactions as cash ﬂow hedges and states them at fair value. The forward 
contracts cover monthly cash ﬂows over the next three and a half years. Further details are noted in the treasury policies in the ﬁnancial review 
section of the Strategic report.

(cid:47)(cid:70)(cid:85)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:84)(cid:84)(cid:80)(cid:68)(cid:74)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)(cid:67)(cid:80)(cid:83)(cid:83)(cid:80)(cid:88)(cid:74)(cid:79)(cid:72)(cid:84)
The Group maintains foreign currency borrowings as a method of providing hedging against the currency translation risk of the net assets of its 
overseas subsidiaries. The level of hedging in place at the year end for the major currencies and their relative base borrowing interest 
rates, were:

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:68)(cid:90)

US Dollar

Japanese Yen

Euro

Net assets of
subsidiary
£’000

38,799

12,893

40,395

Currency
borrowing
£’000

25,495

11,536

34,287

Base borrowing
interest rate
%

0.25

0.10

0.15

The currency borrowings are short term, with ﬂoating interest rates.

For the net assets of the overseas subsidiaries not hedged, a 1% change in exchange rates will affect reserves by approximately £400,000.

(cid:36)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)(cid:1)(cid:78)(cid:66)(cid:79)(cid:66)(cid:72)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)
The Group deﬁnes capital as being the equity attributable to the owners of the Company, which is captioned on the Consolidated balance sheet. 

The Board’s policy is to maintain a strong capital base and to maintain a balance between signiﬁcant returns to shareholders, with a progressive 
dividend policy, whilst ensuring the security of the Group supported by a sound capital position. The Group may adjust dividend payments due 
to changes in economic and market conditions which affect, or are anticipated to affect, group results.

(cid:19)(cid:20)(cid:15)(cid:1)(cid:48)(cid:81)(cid:70)(cid:83)(cid:66)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:77)(cid:70)(cid:66)(cid:84)(cid:70)(cid:84)

The total of future minimum lease payments under non-cancellable operating leases (all of which relate to land and buildings in subsidiaries) were:

Due in less than one year

Due between one and ﬁve years

Total future minimum lease payments

Lease payments recognised as an expense during the year were:

Total lease payments for the ﬁnancial year

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:13)(cid:24)(cid:21)(cid:22)

(cid:20)(cid:13)(cid:26)(cid:23)(cid:21)

(cid:22)(cid:13)(cid:24)(cid:17)(cid:26)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:19)(cid:13)(cid:18)(cid:24)(cid:23)

2013
£’000

1,763

2,357

4,120

2013
£’000

2,024

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116

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes continued

(cid:19)(cid:21)(cid:15)(cid:1)(cid:36)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)(cid:1)(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)

Capital commitments at the end of the year, for which no provision has been made in the ﬁnancial statements, were:

Authorised and committed

(cid:19)(cid:22)(cid:15)(cid:1)(cid:36)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:70)(cid:79)(cid:68)(cid:74)(cid:70)(cid:84)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:17)(cid:13)(cid:23)(cid:24)(cid:23)

2013
£’000

6,052

The UK banking arrangements are subject to cross-guarantees between the Company and its UK subsidiaries. These accounts are subject 
to a right of set-off.

(cid:19)(cid:23)(cid:15)(cid:1)(cid:51)(cid:70)(cid:77)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)(cid:81)(cid:66)(cid:83)(cid:85)(cid:74)(cid:70)(cid:84)

During the year, associates and other related parties purchased goods and services from the Group to the value of £249,000 (2013: £247,000) 
and sold goods and services to the Group to the value of £6,515,000 (2013: £5,024,000). At 30th June 2014, associates owed £56,000 to the 
Group (2013: £54,000). Associates were owed £318,000 by the Group (2013: £167,000). Dividends of £210,000 were received from associates 
during the year (2013: £307,000). Loans to related parties from the Group at 30th June 2014 were £2,520,000 (2013: £2,991,000). 

There were no bad debts written off during the year (2013: £nil).

117

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Notes

C.28

C.29

C.30

C.31

C.32

15

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:26)(cid:25)(cid:13)(cid:22)(cid:23)(cid:24)

(cid:20)(cid:18)(cid:23)(cid:13)(cid:24)(cid:24)(cid:19)

(cid:24)(cid:17)(cid:21)

(cid:21)(cid:18)(cid:23)(cid:13)(cid:17)(cid:21)(cid:20)

(cid:20)(cid:24)(cid:13)(cid:22)(cid:23)(cid:24)

(cid:18)(cid:21)(cid:21)(cid:13)(cid:20)(cid:23)(cid:18)

(cid:26)(cid:13)(cid:22)(cid:21)(cid:18)

(cid:19)(cid:24)(cid:13)(cid:24)(cid:17)(cid:23)

(cid:19)(cid:18)(cid:26)(cid:13)(cid:18)(cid:24)(cid:22)

Restated
2013
£’000

80,847

316,476

6,888

404,211

36,370

101,980

10,982

10,839

160,171

C.33

(cid:9)(cid:18)(cid:19)(cid:23)(cid:13)(cid:20)(cid:22)(cid:19)(cid:10)

(129,039)

(cid:24)(cid:21)(cid:13)(cid:18)(cid:24)(cid:26)

(cid:18)(cid:25)(cid:13)(cid:23)(cid:21)(cid:21)

(cid:26)(cid:19)(cid:13)(cid:25)(cid:19)(cid:20)

23,156

7,976

31,132

(cid:22)(cid:17)(cid:25)(cid:13)(cid:25)(cid:23)(cid:23)

435,343

(cid:9)(cid:26)(cid:17)(cid:17)(cid:10)

(cid:9)(cid:26)(cid:13)(cid:18)(cid:18)(cid:24)(cid:10)

(cid:21)(cid:26)(cid:25)(cid:13)(cid:25)(cid:21)(cid:26)

(cid:9)(cid:19)(cid:20)(cid:13)(cid:21)(cid:19)(cid:18)(cid:10)

(cid:21)(cid:24)(cid:22)(cid:13)(cid:21)(cid:19)(cid:25)

(cid:18)(cid:21)(cid:13)(cid:22)(cid:22)(cid:25)

(cid:21)(cid:19)

(cid:19)(cid:22)(cid:13)(cid:22)(cid:25)(cid:17)

(cid:21)(cid:20)(cid:22)(cid:13)(cid:19)(cid:21)(cid:25)

(cid:21)(cid:24)(cid:22)(cid:13)(cid:21)(cid:19)(cid:25)

(12,031)

(2,626)

420,686

(20,226)

400,460

14,558

42

(694)

386,554

400,460

C.34

C.35

C.36

C.37

C.38

C.39

Company balance sheet

at 30th June 2014

(cid:39)(cid:74)(cid:89)(cid:70)(cid:69)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)

Tangible assets

Investments in subsidiaries

Investments in associates

(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)

Stock

Debtors

Pension scheme escrow bank account

Cash at bank

(cid:36)(cid:83)(cid:70)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)(cid:84)

Amounts falling due within one year

(cid:47)(cid:70)(cid:85)(cid:1)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)

Due within one year

Due after more than one year

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:77)(cid:70)(cid:84)(cid:84)(cid:1)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:85)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

(cid:36)(cid:83)(cid:70)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)(cid:84)

Amounts falling due after more than one year

(cid:49)(cid:83)(cid:80)(cid:87)(cid:74)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

Net assets excluding pension liability

Pension liability

(cid:47)(cid:70)(cid:85)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:74)(cid:79)(cid:68)(cid:77)(cid:86)(cid:69)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:90)

(cid:36)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:83)(cid:70)(cid:84)(cid:70)(cid:83)(cid:87)(cid:70)(cid:84)

Called up share capital

Share premium account

Currency reserve

Proﬁt and loss account

(cid:52)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:70)(cid:83)(cid:84)(cid:8)(cid:1)(cid:71)(cid:86)(cid:79)(cid:69)(cid:84)(cid:1)(cid:111)(cid:1)(cid:70)(cid:82)(cid:86)(cid:74)(cid:85)(cid:90)

These ﬁnancial statements were approved by the Board of directors on 23rd July 2014 and were signed on its behalf by:

(cid:52)(cid:74)(cid:83)(cid:1)(cid:37)(cid:66)(cid:87)(cid:74)(cid:69)(cid:1)(cid:51)(cid:1)(cid:46)(cid:68)(cid:46)(cid:86)(cid:83)(cid:85)(cid:83)(cid:90)(cid:1)
Directors

(cid:34)(cid:1)(cid:36)(cid:1)(cid:40)(cid:1)(cid:51)(cid:80)(cid:67)(cid:70)(cid:83)(cid:85)(cid:84)(cid:1)

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118

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Reconciliation of movements in shareholders’ funds

for the year ended 30th June 2014

Proﬁt for the ﬁnancial year

Dividends paid

Effective portion of changes in fair value of cash ﬂow hedges, net of recycling and deferred tax

Removal of pension scheme guarantee adjustment, net of tax (note C.36)

Actuarial loss in the pension scheme, net of deferred tax

(cid:42)(cid:79)(cid:68)(cid:83)(cid:70)(cid:66)(cid:84)(cid:70)(cid:1)(cid:74)(cid:79)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:70)(cid:83)(cid:84)(cid:8)(cid:1)(cid:71)(cid:86)(cid:79)(cid:69)(cid:84)

Shareholders’ funds at 1st July 2013

(cid:52)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:70)(cid:83)(cid:84)(cid:8)(cid:1)(cid:71)(cid:86)(cid:79)(cid:69)(cid:84)(cid:1)(cid:66)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:25)(cid:20)(cid:13)(cid:19)(cid:25)(cid:22)

(cid:9)(cid:19)(cid:26)(cid:13)(cid:18)(cid:18)(cid:22)(cid:10)

(cid:19)(cid:23)(cid:13)(cid:19)(cid:24)(cid:21)

(cid:111)

(cid:9)(cid:22)(cid:13)(cid:21)(cid:24)(cid:23)(cid:10)

(cid:24)(cid:21)(cid:13)(cid:26)(cid:23)(cid:25)

(cid:21)(cid:17)(cid:17)(cid:13)(cid:21)(cid:23)(cid:17)

(cid:21)(cid:24)(cid:22)(cid:13)(cid:21)(cid:19)(cid:25)

Restated
2013
£’000

29,236

(28,773)

(3,220)

7,396

(1,228)

3,411

397,049

400,460

119

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Notes to the Company ﬁnancial statements

(cid:36)(cid:15)(cid:19)(cid:24)(cid:15)(cid:1)(cid:34)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:70)(cid:84)

The following accounting policies have been applied consistently in dealing with items which are considered material in relation to the ﬁnancial 
statements of the Company. 

(cid:35)(cid:66)(cid:84)(cid:74)(cid:84)(cid:1)(cid:80)(cid:71)(cid:1)(cid:81)(cid:83)(cid:70)(cid:81)(cid:66)(cid:83)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
The ﬁnancial statements have been prepared in accordance with applicable UK GAAP.

Under section 408 of the Companies Act 2006 the Company is exempt from the requirement to present its own proﬁt and loss account. 

Under FRS 1 the Company is exempt from the requirement to prepare a cash ﬂow statement on the grounds that the parent undertaking 
includes the Company in its own published consolidated ﬁnancial statements.

Advantage has been taken of FRS 8 “Related party disclosures” not to disclose transactions with subsidiaries on the basis that all transactions 
were with members of the Group, 100% of whose voting rights were controlled.

The Company has adopted FRS 29 “Financial Instruments Disclosures”, which came into effect from 1st January 2007. However, the Company 
has taken the exemption available to parent companies not to present ﬁnancial instrument disclosures as the group ﬁnancial statements contain 
disclosures that comply with the standard.

(cid:42)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)
Investments in subsidiary and associated undertakings are stated at cost less any provision for permanent impairment losses. 

(cid:53)(cid:66)(cid:79)(cid:72)(cid:74)(cid:67)(cid:77)(cid:70)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:69)(cid:70)(cid:81)(cid:83)(cid:70)(cid:68)(cid:74)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
Tangible assets are stated at cost less accumulated depreciation. Depreciation is provided to write off the cost of assets less their estimated 
residual value on a straight-line basis over their estimated useful economic lives as follows:

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Freehold buildings – 50 years 
Plant and equipment – 3 to 10 years 
Motor vehicles – 3 to 4 years 
No depreciation is provided on freehold land.

(cid:37)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)(cid:84)
Dividends unpaid at the balance sheet date are only recognised as a liability at that date to the extent that they are appropriately declared and 
authorised and no longer at the discretion of the Company.

(cid:51)(cid:70)(cid:84)(cid:70)(cid:66)(cid:83)(cid:68)(cid:73)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:69)(cid:70)(cid:87)(cid:70)(cid:77)(cid:80)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)
Research and development expenditure is charged to proﬁt and loss account in the year in which it is incurred.

(cid:53)(cid:66)(cid:89)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)
The charge for taxation is based on the Company’s proﬁt for the year. Deferred tax is recognised, without discounting, in respect of all timing 
differences between the treatment of certain items for taxation and accounting purposes, which have arisen but not reversed by the balance 
sheet date, except as otherwise required by FRS 19.

Deferred tax assets are recognised to the extent that it is regarded as more likely than not that they will be recovered.

(cid:38)(cid:78)(cid:81)(cid:77)(cid:80)(cid:90)(cid:70)(cid:70)(cid:1)(cid:67)(cid:70)nefi(cid:85)(cid:84)
The Company operated a contributory pension scheme, of the deﬁned beneﬁt type up to 5th April 2007, after which this scheme was closed for 
future accruals to existing members and was closed to new members. Since 5th April 2007, the Company has operated a deﬁned contribution 
scheme, which is part of the same scheme.

The scheme is administered by trustees who are independent of the company ﬁnances. 

Pension scheme assets in the deﬁned beneﬁt scheme are measured using market value. Pension scheme liabilities are measured using a 
projected unit method and discounted at the current rate of return on a high-quality corporate bond of equivalent term and currency to the 
liability. The expected return on the scheme’s assets and the interest on the scheme’s liabilities arising from the passage of time are included in 
other ﬁnance income.

The pension scheme’s surplus, to the extent that it is considered recoverable, or deﬁcit is recognised in full and presented on the face of the 
balance sheet net of the related deferred tax.

Accruals are made for holiday pay, based on a calculation of the number of days holiday earned during the year, but not yet taken and also for 
the annual performance bonus.

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120

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes to the Company ﬁnancial statements continued

(cid:36)(cid:15)(cid:19)(cid:24)(cid:15)(cid:1)(cid:34)(cid:68)(cid:68)(cid:80)(cid:86)(cid:79)(cid:85)(cid:74)(cid:79)(cid:72)(cid:1)(cid:81)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)
(cid:56)(cid:66)(cid:83)(cid:83)(cid:66)(cid:79)(cid:85)(cid:90)(cid:1)(cid:80)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:84)(cid:66)(cid:77)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:84)
The Company provides a warranty from the date of purchase on all its products. This is typically for a 12-month period, although up to three 
years is given for a small number of products. A warranty provision is included in the accounts, which is calculated on the basis of historical 
returns and internal quality reports.

(cid:37)(cid:70)(cid:83)(cid:74)(cid:87)(cid:66)(cid:85)(cid:74)(cid:87)(cid:70)(cid:1)fi(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:74)(cid:79)(cid:84)(cid:85)(cid:83)(cid:86)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)
In accordance with its treasury policy, the Company does not hold or issue derivative ﬁnancial instruments for trading purposes. 

The Company uses forward exchange contracts to hedge its exposure to foreign exchange risk arising from operational and ﬁnancing activities. 
Forward exchange contracts are recognised initially at cost and then subsequently remeasured at fair value. Where a forward contract is 
designated as a hedge of the variability in future cash inﬂows, the effective part of any gain or loss on the forward contract is recognised directly 
in equity. Any effective cumulative gain or loss is removed from equity and recognised in the proﬁt and loss account at the same time as the 
hedged transaction. The ineffective part of any gain or loss is recognised in the proﬁt and loss account immediately.

However, derivatives that do not qualify for hedge accounting are accounted for as trading instruments. 

(cid:52)(cid:85)(cid:80)(cid:68)(cid:76)(cid:84)
Stocks are valued at the lower of cost and net realisable value. Cost comprises direct materials and labour plus overheads applicable to the 
stage of manufacture reached.

(cid:39)(cid:80)(cid:83)(cid:70)(cid:74)(cid:72)(cid:79)(cid:1)(cid:68)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:68)(cid:74)(cid:70)(cid:84)
Transactions in foreign currencies are translated at the rate of exchange ruling at the date of the transaction. Monetary assets and liabilities 
denominated in foreign currencies at the balance sheet date are translated into Sterling at the foreign exchange rate ruling at that date. 
Foreign exchange differences arising on such translation are recognised in the proﬁt and loss account.

(cid:40)(cid:80)(cid:74)(cid:79)(cid:72)(cid:1)(cid:68)(cid:80)(cid:79)(cid:68)(cid:70)(cid:83)(cid:79)
The Company’s business activities, together with the factors likely to affect its future development, performance and position are set out in the 
Strategic report, where also given are details of the ﬁnancial and liquidity positions. In addition, note 22 in the ﬁnancial statements includes the 
Company’s objectives and policies for managing its capital, details of its ﬁnancial instruments and hedging activities and its exposures to credit 
risk and liquidity risk.

The Company has considerable ﬁnancial resources at its disposal and the directors have considered the current ﬁnancial projections. 
As a consequence, the directors believe that the Company is well placed to manage its business risks successfully.

After making enquiries, the directors have a reasonable expectation that the Company and the Group have adequate resources to continue 
in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the Annual report 
and accounts.

(cid:36)(cid:15)(cid:19)(cid:25)(cid:15)(cid:1)(cid:53)angible fixed assets

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:36)(cid:80)(cid:84)(cid:85)

At 1st July 2013

Additions

Transfers

Disposals

(cid:34)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:37)(cid:70)(cid:81)(cid:83)(cid:70)(cid:68)(cid:74)(cid:66)(cid:85)(cid:74)(cid:80)(cid:79)

At 1st July 2013

Charge for the year

Released on disposals

(cid:34)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

(cid:47)(cid:70)(cid:85)(cid:1)(cid:67)(cid:80)(cid:80)(cid:76)(cid:1)(cid:87)(cid:66)(cid:77)(cid:86)(cid:70)

(cid:34)(cid:85)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

At 30th June 2013

(cid:39)(cid:83)(cid:70)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)
(cid:77)(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:79)(cid:69)
(cid:67)(cid:86)(cid:74)(cid:77)(cid:69)(cid:74)(cid:79)(cid:72)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

51,741

301

1,504

–

(cid:49)(cid:77)(cid:66)(cid:79)(cid:85)(cid:1)(cid:66)(cid:79)(cid:69)
(cid:70)(cid:82)(cid:86)(cid:74)(cid:81)(cid:78)(cid:70)(cid:79)(cid:85)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:46)(cid:80)(cid:85)(cid:80)(cid:83)
(cid:87)(cid:70)(cid:73)(cid:74)(cid:68)(cid:77)(cid:70)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:34)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)
(cid:68)(cid:80)(cid:86)(cid:83)(cid:84)(cid:70)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:68)(cid:80)(cid:79)(cid:84)(cid:85)(cid:83)(cid:86)(cid:68)(cid:85)(cid:74)(cid:80)(cid:79)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

106,622

3,303

2,144

14,163

(613)

181

–

(264)

5,304

24,329

(15,667)

–

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

166,970

26,955

–

(877)

(cid:22)(cid:20)(cid:13)(cid:22)(cid:21)(cid:23)

(cid:18)(cid:19)(cid:19)(cid:13)(cid:20)(cid:18)(cid:23)

(cid:20)(cid:13)(cid:19)(cid:19)(cid:17)

(cid:18)(cid:20)(cid:13)(cid:26)(cid:23)(cid:23)

(cid:18)(cid:26)(cid:20)(cid:13)(cid:17)(cid:21)(cid:25)

10,772

543

–

(cid:18)(cid:18)(cid:13)(cid:20)(cid:18)(cid:22)

(cid:21)(cid:19)(cid:13)(cid:19)(cid:20)(cid:18)

40,969

73,080

8,296

(446)

(cid:25)(cid:17)(cid:13)(cid:26)(cid:20)(cid:17)

(cid:21)(cid:18)(cid:13)(cid:20)(cid:25)(cid:23)

33,542

2,271

174

(209)

(cid:19)(cid:13)(cid:19)(cid:20)(cid:23)

(cid:26)(cid:25)(cid:21)

1,032

–

–

–

(cid:111)

(cid:18)(cid:20)(cid:13)(cid:26)(cid:23)(cid:23)

5,304

86,123

9,013

(655)

(cid:26)(cid:21)(cid:13)(cid:21)(cid:25)(cid:18)

(cid:26)(cid:25)(cid:13)(cid:22)(cid:23)(cid:24)

80,847

121

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

(cid:36)(cid:15)(cid:19)(cid:25)(cid:15)(cid:1)(cid:53)angible fixed assets continued(cid:1)

At 30th June 2014, properties with a net book value of £37,597,000 (2013: £25,825,000) were subject to a registered charge to secure the 
UK deﬁned beneﬁt pension scheme liabilities. The trustees have the right to enforce the charge to recover any deﬁcit up to £40,830,000 if an 
insolvency event occurs in relation to the Company before 1st November 2016 or if the Company has not made good any deﬁcit up to 
£40,830,000 by midnight on 1st November 2016.

Additions to assets in the course of construction of £24,329,000 (2013: £8,311,000) comprise £13,185,000 (2013: £1,208,000) for freehold land 
and buildings and £11,144,000 (2013: £7,103,000) for plant and equipment.

(cid:36)(cid:15)(cid:19)(cid:26)(cid:15)(cid:1)(cid:42)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:74)(cid:79)(cid:1)(cid:84)(cid:86)(cid:67)(cid:84)(cid:74)(cid:69)(cid:74)(cid:66)(cid:83)(cid:74)(cid:70)(cid:84)

Movements during the year were:

Balance at the beginning of the year

Investments made during the year

Balance at the end of the year

(cid:36)(cid:15)(cid:20)(cid:17)(cid:15)(cid:1)(cid:42)(cid:79)(cid:87)(cid:70)(cid:84)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)(cid:1)(cid:74)(cid:79)(cid:1)(cid:66)(cid:84)(cid:84)(cid:80)(cid:68)(cid:74)(cid:66)(cid:85)(cid:70)(cid:84)

Movements during the year were:

Balance at the beginning of the year

Disposal of shareholding in Delcam plc

Balance at the end of the year

(cid:36)(cid:15)(cid:20)(cid:18)(cid:15)(cid:1)(cid:52)(cid:85)(cid:80)(cid:68)(cid:76)

An analysis of stock at the end of the year was:

Raw materials

Work in progress

Finished goods

Balance at the end of the year

(cid:36)(cid:15)(cid:20)(cid:19)(cid:15)(cid:1)(cid:37)(cid:70)(cid:67)(cid:85)(cid:80)(cid:83)(cid:84)

An analysis of debtors at the end of the year was:

(cid:37)(cid:70)(cid:67)(cid:85)(cid:80)(cid:83)(cid:84)(cid:1)(cid:69)(cid:86)(cid:70)(cid:1)(cid:88)(cid:74)(cid:85)(cid:73)(cid:74)(cid:79)(cid:1)(cid:80)(cid:79)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

Trade debtors

Amounts owed by group undertakings

Amounts owed by associated undertakings

Prepayments and other receivables

Fair value of forward exchange contracts

(cid:37)(cid:70)(cid:67)(cid:85)(cid:80)(cid:83)(cid:84)(cid:1)(cid:69)(cid:86)(cid:70)(cid:1)(cid:66)(cid:71)(cid:85)(cid:70)(cid:83)(cid:1)(cid:78)(cid:80)(cid:83)(cid:70)(cid:1)(cid:85)(cid:73)(cid:66)(cid:79)(cid:1)(cid:80)(cid:79)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

Fair value of forward exchange contracts

Balance at the end of the year

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

2013
£’000

(cid:20)(cid:18)(cid:23)(cid:13)(cid:21)(cid:24)(cid:23)

316,476

(cid:19)(cid:26)(cid:23)

 –

(cid:20)(cid:18)(cid:23)(cid:13)(cid:24)(cid:24)(cid:19)

316,476

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:23)(cid:13)(cid:25)(cid:25)(cid:25)

(cid:9)(cid:23)(cid:13)(cid:18)(cid:25)(cid:21)(cid:10)

(cid:24)(cid:17)(cid:21)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:21)(cid:13)(cid:24)(cid:20)(cid:18)

(cid:18)(cid:21)(cid:13)(cid:22)(cid:22)(cid:18)

(cid:25)(cid:13)(cid:19)(cid:25)(cid:22)

(cid:20)(cid:24)(cid:13)(cid:22)(cid:23)(cid:24)

2013
£’000

6,888

 –

6,888

2013
£’000

11,841

15,316

9,213

36,370

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

2013
£’000

(cid:18)(cid:20)(cid:13)(cid:22)(cid:22)(cid:18)

(cid:26)(cid:17)(cid:13)(cid:26)(cid:26)(cid:19)

(cid:22)(cid:23)

(cid:24)(cid:13)(cid:24)(cid:24)(cid:17)

(cid:18)(cid:20)(cid:13)(cid:20)(cid:21)(cid:25)

(cid:18)(cid:19)(cid:22)(cid:13)(cid:24)(cid:18)(cid:24)

(cid:18)(cid:25)(cid:13)(cid:23)(cid:21)(cid:21)

(cid:18)(cid:21)(cid:21)(cid:13)(cid:20)(cid:23)(cid:18)

11,610

71,736

3,045

4,030

3,583

94,004

7,976

101,980

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122

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes to the Company ﬁnancial statements continued

(cid:36)(cid:15)(cid:20)(cid:20)(cid:15)(cid:1)(cid:36)(cid:83)(cid:70)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)(cid:84)

(cid:34)(cid:78)(cid:80)(cid:86)(cid:79)(cid:85)(cid:84)(cid:1)(cid:71)(cid:66)(cid:77)(cid:77)(cid:74)(cid:79)(cid:72)(cid:1)(cid:69)(cid:86)(cid:70)(cid:1)(cid:88)(cid:74)(cid:85)(cid:73)(cid:74)(cid:79)(cid:1)(cid:80)(cid:79)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)
An analysis of creditors due within one year at the end of the year was:

Trade creditors

Corporation tax

Amounts owed to group undertakings

Amounts owed to associated undertakings

Other taxes and social security

Other creditors

Fair value of forward exchange contracts

Balance at the end of the year

(cid:36)(cid:15)(cid:20)(cid:21)(cid:15)(cid:1)(cid:36)(cid:83)(cid:70)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)(cid:84)

(cid:34)(cid:78)(cid:80)(cid:86)(cid:79)(cid:85)(cid:84)(cid:1)(cid:71)(cid:66)(cid:77)(cid:77)(cid:74)(cid:79)(cid:72)(cid:1)(cid:69)(cid:86)(cid:70)(cid:1)(cid:66)(cid:71)(cid:85)(cid:70)(cid:83)(cid:1)(cid:78)(cid:80)(cid:83)(cid:70)(cid:1)(cid:85)(cid:73)(cid:66)(cid:79)(cid:1)(cid:80)(cid:79)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)
An analysis of creditors due after more than one year was:

Deferred consideration

Fair value of forward exchange contracts

Total creditors due after more than one year

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:20)(cid:13)(cid:26)(cid:20)(cid:25)

(cid:19)(cid:13)(cid:18)(cid:17)(cid:17)

(cid:18)(cid:17)(cid:22)(cid:13)(cid:18)(cid:19)(cid:23)

(cid:19)(cid:18)(cid:21)

(cid:19)(cid:13)(cid:20)(cid:21)(cid:23)

(cid:19)(cid:13)(cid:23)(cid:19)(cid:25)

(cid:111)

2013
£’000

13,611

1,694

106,196

67

2,109

3,344

2,018

(cid:18)(cid:19)(cid:23)(cid:13)(cid:20)(cid:22)(cid:19)

129,039

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:25)(cid:25)(cid:20)

(cid:18)(cid:24)

(cid:26)(cid:17)(cid:17)

2013
£’000

1,589

10,442

12,031

The deferred consideration of £883,000 is in respect of investments in subsidiaries, which is payable over the next three years (2013: £1,589,000).

(cid:36)(cid:15)(cid:20)(cid:22)(cid:15)(cid:1)(cid:49)(cid:83)(cid:80)(cid:87)(cid:74)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:73)(cid:66)(cid:83)(cid:72)(cid:70)(cid:84)

An analysis of provisions for liabilities and charges was:

Warranty provision

Deferred tax

Total provisions for liabilities and charges

(cid:56)(cid:66)(cid:83)(cid:83)(cid:66)(cid:79)(cid:85)(cid:90)(cid:1)(cid:81)(cid:83)(cid:80)(cid:87)(cid:74)(cid:84)(cid:74)(cid:80)(cid:79)
Movements during the year were:

Balance at the beginning of the year

Created in the year

Utilised in the year

Balance at the end of the year

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:26)(cid:21)(cid:25)

(cid:25)(cid:13)(cid:18)(cid:23)(cid:26)

(cid:26)(cid:13)(cid:18)(cid:18)(cid:24)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:13)(cid:19)(cid:23)(cid:17)

(cid:20)(cid:26)(cid:19)

(cid:9)(cid:24)(cid:17)(cid:21)(cid:10)

(cid:9)(cid:20)(cid:18)(cid:19)(cid:10)

(cid:26)(cid:21)(cid:25)

2013
£’000

1,260

1,366

2,626

2013
£’000

917

617

(274)

343

1,260

The warranty provision has been calculated on the basis of historical return-in-warranty information and other quality reports. It is expected 
that most of this expenditure will be incurred in the next ﬁnancial year and all expenditure will be incurred within three years of the balance 
sheet date.

123

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:13)(cid:20)(cid:23)(cid:23)

(cid:23)(cid:13)(cid:25)(cid:17)(cid:20)

(cid:25)(cid:13)(cid:18)(cid:23)(cid:26)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:13)(cid:25)(cid:19)(cid:21)

(cid:23)(cid:13)(cid:20)(cid:21)(cid:22)

(cid:25)(cid:13)(cid:18)(cid:23)(cid:26)

(cid:9)(cid:22)(cid:13)(cid:25)(cid:22)(cid:22)(cid:10)

(cid:19)(cid:13)(cid:20)(cid:18)(cid:21)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:9)(cid:21)(cid:13)(cid:23)(cid:24)(cid:22)(cid:10)

(cid:111)

(cid:25)(cid:23)(cid:20)

(cid:23)(cid:13)(cid:18)(cid:19)(cid:23)

(cid:19)(cid:13)(cid:20)(cid:18)(cid:21)

2013
£’000

1,994

(628)

1,366

Restated
2013
£’000

1,623

(257)

1,366

(6,041)

(4,675)

Restated
2013
£’000

(6,919)

2,304

377

(437)

(4,675)

(cid:36)(cid:15)(cid:20)(cid:22)(cid:15)(cid:1)(cid:49)(cid:83)(cid:80)(cid:87)(cid:74)(cid:84)(cid:74)(cid:80)(cid:79)(cid:84)(cid:1)(cid:71)(cid:80)(cid:83)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:73)(cid:66)(cid:83)(cid:72)(cid:70)(cid:84)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)(cid:1)

(cid:37)(cid:70)(cid:71)(cid:70)(cid:83)(cid:83)(cid:70)(cid:69)(cid:1)(cid:85)(cid:66)(cid:89)
Movements during the year were:

Balance at the beginning of the year

Movements during the year

Balance at the end of the year

The deferred tax asset is represented by:

Difference between accumulated depreciation and capital allowances

Other timing differences

Deferred tax on pension scheme liability (note C.36)

Balance at the end of the year

The movements in the deferred tax balance were:

Balance at the beginning of the year

Removal of pension scheme guarantee adjustment

Amount charged to the proﬁt and loss account

Amount reﬂected through the statement of total recognised gains and losses

Balance at the end of the year

(cid:36)(cid:15)(cid:20)(cid:23)(cid:15)(cid:1)(cid:49)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)

The Company operated a deﬁned beneﬁt pension scheme, which, in April 2007, ceased any future accrual for current members and was closed 
to new members. Employees of the Company are now covered by a deﬁned contribution scheme. See note 15 regarding details of registered 
charges relating to the UK deﬁned beneﬁt pension scheme liabilities.

The total pension cost of the Company for the year was £9,330,000 (2013: £7,511,000), of which £182,000 (2013: £169,000) related to directors. 

The latest full actuarial valuation of the scheme was carried out at September 2012 and updated to 30th June 2014 on an FRS 17 basis by a 
qualiﬁed independent actuary.

The major assumptions used by the actuary for the scheme were:

Rate of increase in pension payments

Discount rate

Inﬂation rate (RPI)

Inﬂation rate (CPI)

Expected return on assets

Retirement age

(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

30th June 2013

30th June 2012

(cid:20)(cid:15)(cid:22)(cid:6)

(cid:21)(cid:15)(cid:21)(cid:6)

(cid:20)(cid:15)(cid:24)(cid:6)

(cid:19)(cid:15)(cid:24)(cid:6)

(cid:24)(cid:15)(cid:20)(cid:6)

(cid:23)(cid:21)

3.5%

4.8%

3.7%

2.7%

7.3%

64

2.7%

4.3%

2.7%

1.7%

6.7%

64

The mortality assumption adopted for 2014 is S1PMA and S1PFA tables, CMI (core) 2011 model with long term improvements of 1% per annum.

S
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c
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a
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c
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124

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes to the Company ﬁnancial statements continued

(cid:36)(cid:15)(cid:20)(cid:23)(cid:15)(cid:1)(cid:49)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

The assets and liabilities in the scheme were:

Market value of assets:

Equities

Bonds and cash

Actuarial value of liabilities

Deﬁcit in the scheme

Deferred tax thereon

Pension liability

(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)
(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

% of
total
assets

Restated
30th June
2013
£’000

% of
total
assets

30th June
2012
£’000

% of
total
assets

30th June
2011
£’000

% of
total
assets

30th June
2010
£’000

% of
total
assets

(cid:18)(cid:18)(cid:23)(cid:13)(cid:25)(cid:17)(cid:22)

100

106,117

100

89,653

100

94,941

100

78,248

100

(cid:18)(cid:26)(cid:25)

–

301

–

154

–

362

–

156

 –

(cid:18)(cid:18)(cid:24)(cid:13)(cid:17)(cid:17)(cid:20)

100

106,418

100

89,807

100

95,303

100

78,404

100

(cid:9)(cid:18)(cid:21)(cid:23)(cid:13)(cid:19)(cid:24)(cid:26)(cid:10)

(cid:9)(cid:19)(cid:26)(cid:13)(cid:19)(cid:24)(cid:23)(cid:10)

(cid:22)(cid:13)(cid:25)(cid:22)(cid:22)

(cid:9)(cid:19)(cid:20)(cid:13)(cid:21)(cid:19)(cid:18)(cid:10)

–

–

–

–

(132,685)

(26,267)

6,041

(20,226)

–

–

–

–

(126,946)

(37,139)

8,913

(28,226)

–

–

–

–

(130,008)

(34,705)

9,023

(25,682)

–

–

–

–

(111,569)

(33,165)

9,286

(23,879)

–

–

–

–

The history of experience gains and losses is:

(cid:37)(cid:74)(cid:71)(cid:71)(cid:70)(cid:83)(cid:70)(cid:79)(cid:68)(cid:70)(cid:1)(cid:67)(cid:70)(cid:85)(cid:88)(cid:70)(cid:70)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:70)(cid:89)(cid:81)(cid:70)(cid:68)(cid:85)(cid:70)(cid:69)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:66)(cid:68)(cid:85)(cid:86)(cid:66)(cid:77)(cid:1)
(cid:83)(cid:70)(cid:85)(cid:86)(cid:83)(cid:79) (cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:1)(cid:66)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)

amount (£’000)

percentage of scheme assets

(cid:38)(cid:89)(cid:81)(cid:70)(cid:83)(cid:74)(cid:70)(cid:79)(cid:68)(cid:70)(cid:1)(cid:72)(cid:66)(cid:74)(cid:79)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:77)(cid:80)(cid:84)(cid:84)(cid:70)(cid:84)(cid:1)(cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:1)(cid:77)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

amount (£’000)

percentage of present value of scheme liabilities
(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)(cid:1)(cid:66)(cid:78)(cid:80)(cid:86)(cid:79)(cid:85)(cid:1)(cid:83)(cid:70)(cid:68)(cid:80)(cid:72)(cid:79)(cid:74)(cid:84)(cid:70)(cid:69)(cid:1)(cid:74)(cid:79)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:80)(cid:71)(cid:1)
(cid:85)(cid:80)(cid:85)(cid:66)(cid:77) (cid:83)(cid:70)(cid:68)(cid:80)(cid:72)(cid:79)(cid:74)(cid:84)(cid:70)(cid:69)(cid:1)(cid:72)(cid:66)(cid:74)(cid:79)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:77)(cid:80)(cid:84)(cid:84)(cid:70)(cid:84)

amount (£’000)

percentage of present value of scheme liabilities

The movements in the scheme were:

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)(cid:1)(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

Deﬁcit in scheme at the beginning of the year

Contributions

Expected return on pension scheme assets

Interest on pension scheme liabilities

Actuarial gain/(loss)

Beneﬁts received/(paid)
(cid:37)(cid:70)ﬁ(cid:68)(cid:74)(cid:85)(cid:1)(cid:74)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:1)(cid:66)(cid:85)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:70)(cid:79)(cid:69)(cid:1)(cid:80)(cid:71)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)

Year ended 30th June 2013 (restated)

Deﬁcit in scheme at the beginning of the year

Contributions

Expected return on pension scheme assets

Interest on pension scheme liabilities

Actuarial gain/(loss)

Removal of pension scheme guarantee adjustment

Beneﬁts received/(paid)
Deﬁcit in scheme at the end of the year

(cid:58)(cid:70)(cid:66)(cid:83)(cid:1)(cid:70)(cid:79)(cid:69)(cid:70)(cid:69)
(cid:20)(cid:17)(cid:85)(cid:73)(cid:1)(cid:43)(cid:86)(cid:79)(cid:70)(cid:1)(cid:19)(cid:17)(cid:18)(cid:21)

Restated
Year ended
30th June 2013

Year ended
30th June 2012

Year ended
30th June 2011

Year ended
30th June 2010

(cid:20)(cid:13)(cid:19)(cid:21)(cid:22)

(cid:20)(cid:6)

(cid:19)(cid:13)(cid:25)(cid:19)(cid:25)

(cid:19)(cid:6)

10,707

10%

(13,168)

(15%)

–

–

–

–

(cid:9)(cid:22)(cid:13)(cid:26)(cid:22)(cid:19)(cid:10)

(cid:9)(cid:21)(cid:6)(cid:10)

(1,230)

(1%)

(5,836)

(5%)

11,650

12%

(1,521)

(1%)

(2,588)

(2%)

9,357

12%

–

–

(14,135)

(13%)

(cid:34)(cid:84)(cid:84)(cid:70)(cid:85)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:45)(cid:74)(cid:66)(cid:67)(cid:74)(cid:77)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:53)(cid:80)(cid:85)(cid:66)(cid:77)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:18)(cid:17)(cid:23)(cid:13)(cid:21)(cid:18)(cid:25)

(cid:9)(cid:18)(cid:20)(cid:19)(cid:13)(cid:23)(cid:25)(cid:22)(cid:10)

(cid:9)(cid:19)(cid:23)(cid:13)(cid:19)(cid:23)(cid:24)(cid:10)

(cid:18)(cid:13)(cid:22)(cid:18)(cid:20)

(cid:24)(cid:13)(cid:24)(cid:22)(cid:20)

(cid:111)

(cid:20)(cid:13)(cid:19)(cid:21)(cid:22)

(cid:9)(cid:18)(cid:13)(cid:26)(cid:19)(cid:23)(cid:10)

(cid:111)

(cid:111)

(cid:9)(cid:23)(cid:13)(cid:20)(cid:19)(cid:20)(cid:10)

(cid:9)(cid:26)(cid:13)(cid:18)(cid:26)(cid:24)(cid:10)

(cid:18)(cid:13)(cid:26)(cid:19)(cid:23)

(cid:18)(cid:13)(cid:22)(cid:18)(cid:20)

(cid:24)(cid:13)(cid:24)(cid:22)(cid:20)

(cid:9)(cid:23)(cid:13)(cid:20)(cid:19)(cid:20)(cid:10)

(cid:9)(cid:22)(cid:13)(cid:26)(cid:22)(cid:19)(cid:10)

(cid:111)

(cid:18)(cid:18)(cid:24)(cid:13)(cid:17)(cid:17)(cid:20)

(cid:9)(cid:18)(cid:21)(cid:23)(cid:13)(cid:19)(cid:24)(cid:26)(cid:10)

(cid:9)(cid:19)(cid:26)(cid:13)(cid:19)(cid:24)(cid:23)(cid:10)

Assets
£’000

Liabilities
£’000

Total
£’000

89,807

(126,946)

(37,139)

1,398

6,013

–

10,707

–

(1,507)
106,418

–

–

(5,009)

(11,937)

9,700

1,507
(132,685)

1,398

6,013

(5,009)

(1,230)

9,700

–
(26,267)

125

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

(cid:36)(cid:15)(cid:20)(cid:23)(cid:15)(cid:1)(cid:49)(cid:70)(cid:79)(cid:84)(cid:74)(cid:80)(cid:79)(cid:1)(cid:84)(cid:68)(cid:73)(cid:70)(cid:78)(cid:70)(cid:1)(cid:68)(cid:80)(cid:79)(cid:85)(cid:74)(cid:79)(cid:86)(cid:70)(cid:69)

The 2013 ﬁgures have been restated in order to remove the impact of the guarantee offered by the Company. This had been incorrectly 
included under UK GAAP.

The analysis of the amount recognised in the statement of total recognised gains and losses was:

Actual return less expected return on scheme assets

Experience gain arising on scheme liabilities

Changes in ﬁnancial assumptions

Total recognised in the statement of total recognised gains and losses

(cid:36)(cid:15)(cid:20)(cid:24)(cid:15)(cid:1)(cid:52)(cid:73)(cid:66)(cid:83)(cid:70)(cid:1)(cid:68)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)

(cid:34)(cid:77)(cid:77)(cid:80)(cid:85)(cid:85)(cid:70)(cid:69)(cid:13)(cid:1)(cid:68)(cid:66)(cid:77)(cid:77)(cid:70)(cid:69)(cid:14)(cid:86)(cid:81)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:71)(cid:86)(cid:77)(cid:77)(cid:90)(cid:1)(cid:81)(cid:66)(cid:74)(cid:69)
72,788,543 ordinary shares of 20p each

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:20)(cid:13)(cid:19)(cid:21)(cid:22)

(cid:19)(cid:13)(cid:25)(cid:19)(cid:25)

(cid:9)(cid:18)(cid:19)(cid:13)(cid:17)(cid:19)(cid:22)(cid:10)

(cid:9)(cid:22)(cid:13)(cid:26)(cid:22)(cid:19)(cid:10)

2013
£’000

10,707

–

(11,937)

(1,230)

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

2013
£’000

(cid:18)(cid:21)(cid:13)(cid:22)(cid:22)(cid:25)

14,558

The ordinary shares are the only class of share in the Company. Holders of ordinary shares are entitled to vote at general meetings of the 
Company and receive dividends as declared. The Articles of Association of the Company do not contain any restrictions on the transfer of 
shares nor on voting rights.

(cid:36)(cid:15)(cid:20)(cid:25)(cid:15)(cid:1)(cid:36)(cid:86)(cid:83)(cid:83)(cid:70)(cid:79)(cid:68)(cid:90)(cid:1)(cid:83)(cid:70)(cid:84)(cid:70)(cid:83)(cid:87)(cid:70)

The currency reserve comprises all foreign exchange differences arising from the valuation of forward exchange contracts which are effective 
hedges and mature after the year end. These are valued on a mark-to-market basis, are accounted for directly in equity and are recycled 
through the proﬁt and loss account when the hedged item affects the proﬁt and loss account.

The unrealised currency gain/(loss) on foreign exchange forward contracts outstanding at the year end has been recognised net of deferred tax.

Movements during the year were:

Balance at the beginning of the year

Amounts recycled into the proﬁt and loss account in the year

Revaluations during the year

Deferred tax movement

Balance at the end of the year

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:9)(cid:23)(cid:26)(cid:21)(cid:10)

(cid:9)(cid:18)(cid:13)(cid:22)(cid:23)(cid:22)(cid:10)

(cid:20)(cid:21)(cid:13)(cid:21)(cid:21)(cid:18)

(cid:9)(cid:23)(cid:13)(cid:23)(cid:17)(cid:19)(cid:10)

(cid:19)(cid:22)(cid:13)(cid:22)(cid:25)(cid:17)

2013
£’000

2,526

(2,106)

(2,119)

1,005

(694)

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126

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Financial statements

Notes to the Company ﬁnancial statements continued

(cid:36)(cid:15)(cid:20)(cid:26)(cid:15)(cid:1)(cid:49)(cid:83)ofit and loss account

Movements in the proﬁt and loss account during the year were:

Balance at the beginning of the year

Proﬁt for the year

Dividends paid in the year 

Removal of pension scheme guarantee adjustment, net of tax

Actuarial loss in the pension scheme

Deferred tax thereon

Balance at the end of the year

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:20)(cid:25)(cid:23)(cid:13)(cid:22)(cid:22)(cid:21)

(cid:25)(cid:20)(cid:13)(cid:19)(cid:25)(cid:22)

(cid:9)(cid:19)(cid:26)(cid:13)(cid:18)(cid:18)(cid:22)(cid:10)

(cid:111)

(cid:9)(cid:22)(cid:13)(cid:26)(cid:22)(cid:19)(cid:10)

(cid:21)(cid:24)(cid:23)

(cid:9)(cid:22)(cid:13)(cid:21)(cid:24)(cid:23)(cid:10)

(cid:21)(cid:20)(cid:22)(cid:13)(cid:19)(cid:21)(cid:25)

Restated
2013
£’000

379,923

29,236

(28,773)

7,396

(1,230)

2

(1,228)

386,554

Proﬁt for the year includes dividends received of £27,210,000 (2013: £307,000) from associates and a subsidiary undertaking.

(cid:36)(cid:15)(cid:21)(cid:17)(cid:15)(cid:1)(cid:51)(cid:70)(cid:77)(cid:66)(cid:85)(cid:70)(cid:69)(cid:1)(cid:81)(cid:66)(cid:83)(cid:85)(cid:74)(cid:70)(cid:84)

During the year, related parties, these being Renishaw Diagnostics Limited, Renishaw Mayﬁeld S.A. and the Group’s associates (see note 11), 
purchased goods and services from the Company to the value of £331,000 (2013: £256,000) and sold goods and services to the Company 
to the value of £2,579,000 (2013: £2,209,000).

At 30th June 2014, related parties owed £56,000 (2013: £54,000) to the Company. Related parties were owed £214,000 (2013: £67,000) 
by the Company. Dividends of £210,000 were received from related parties during the year (2013: £307,000). Loans to related parties from 
the Company at 30th June 2014 were £10,373,000 (2013: £9,871,000). 

All transactions were on an arm’s length basis. There were no bad debts written off during the year (2013: £nil). 

(cid:36)(cid:15)(cid:21)(cid:18)(cid:15)(cid:1)(cid:36)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)(cid:1)(cid:68)(cid:80)(cid:78)(cid:78)(cid:74)(cid:85)(cid:78)(cid:70)(cid:79)(cid:85)(cid:84)

Capital commitments at the end of the year, for which no provision has been made in the ﬁnancial statements, were:

Authorised and committed

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

(cid:24)(cid:13)(cid:23)(cid:18)(cid:19)

2013
£’000

5,769

127

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Shareholder information

10 year ﬁnancial record

(cid:51)(cid:70)(cid:84)(cid:86)(cid:77)(cid:85)(cid:84)

(cid:79)(cid:80)(cid:85)(cid:70)(cid:1)(cid:19)
(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

note 2
2013
£’000

2012
£’000

note 2
2011
£’000

note 2
2010
£’000

note 2
2009
£’000

note 2
2008
£’000

note 2
2007
£’000

2006
£’000

note 1
2005
£’000

Overseas revenue

(cid:20)(cid:20)(cid:18)(cid:13)(cid:23)(cid:25)(cid:19)

326,213

313,007

273,989

170,957

159,988

189,137

169,094

164,322

144,438

UK revenue

Total revenue

Operating proﬁt

Proﬁt before tax

Taxation

Proﬁt for the year

(cid:19)(cid:20)(cid:13)(cid:25)(cid:18)(cid:23)

20,668

18,885

14,761

10,650

11,259

12,020

11,789

11,513

10,361

(cid:20)(cid:22)(cid:22)(cid:13)(cid:21)(cid:26)(cid:25)

346,881

331,892

288,750

181,607

171,247

201,157

180,883

175,835

154,799

(cid:24)(cid:17)(cid:13)(cid:20)(cid:25)(cid:25)

(cid:24)(cid:17)(cid:13)(cid:18)(cid:17)(cid:23)

(cid:18)(cid:17)(cid:13)(cid:24)(cid:19)(cid:17)

(cid:22)(cid:26)(cid:13)(cid:20)(cid:25)(cid:23)

79,071

83,188

79,286

28,095

79,193

86,046

80,410

28,725

15,046

64,147

17,008

16,345

5,745

69,038

64,065

22,980

5,991

8,843

2,105

6,738

37,335

29,729

35,468

29,307

41,715

32,672

38,102

31,733

8,309

6,532

7,621

6,297

33,406

26,140

30,481

25,436

(cid:36)(cid:66)(cid:81)(cid:74)(cid:85)(cid:66)(cid:77)(cid:1)(cid:70)(cid:78)(cid:81)(cid:77)(cid:80)(cid:90)(cid:70)(cid:69)

Share capital

Share premium

Reserves

Total equity

(cid:52)(cid:85)(cid:66)(cid:85)(cid:74)(cid:84)(cid:85)(cid:74)(cid:68)(cid:84)
Overseas revenue  
as a percentage of  
total revenue
Adjusted earnings per 
share 

Proposed dividend 

Notes

(cid:19)(cid:17)(cid:18)(cid:21)
(cid:98)(cid:8)(cid:17)(cid:17)(cid:17)

2013
£’000

2012
£’000

2011
£’000

2010
£’000

2009
£’000

2008
£’000

2007
£’000

2006
£’000

2005
£’000

(cid:18)(cid:21)(cid:13)(cid:22)(cid:22)(cid:25)

14,558

14,558

14,558

14,558

14,558

14,558

14,558

14,558

14,558

(cid:21)(cid:19)

42

42

42

42

42

42

42

42

42

(cid:20)(cid:20)(cid:23)(cid:13)(cid:18)(cid:23)(cid:20)

262,119

227,799

187,118

144,021

129,162

151,725

153,400

128,136

110,857

(cid:20)(cid:22)(cid:17)(cid:13)(cid:24)(cid:23)(cid:20)

276,719

242,399

201,718

158,621

143,762

166,325

168,000

142,736

125,457

(cid:19)(cid:17)(cid:18)(cid:21)

2013

2012

2011

2010

2009

2008

2007

2006

2005

(cid:26)(cid:20)(cid:15)(cid:20)(cid:6)

94.0%

94.3%

94.9%

94.1%

93.4%

94.0%

93.5%

93.5%

93.3%

(cid:25)(cid:19)(cid:15)(cid:20)(cid:81)

(cid:21)(cid:18)(cid:15)(cid:19)(cid:81)

88.9p

40.0p

95.6p

38.5p

88.5p

35.0p

32.3p

17.6p

9.6p

45.9p

35.9p

41.9p

34.9p

7.76p

25.39p

22.87p

21.78p

19.80p

1.  For the year 2005 and onwards, the ﬁnancial statements have been prepared under adopted IFRS.

2.  The results and adjusted earnings per share for the years 2007 to 2011, 2013 and 2014 exclude the exceptional items. These were: 2007 
and 2008 – pension curtailment credits (2007: £19.5m; 2008: £1.3m); 2009 – redundancy costs (£4.1m); 2010 – impairment write-down 
(£1.7m); 2011 – reversal of impairment write-down (£1.7m); 2013 – gain on deferred consideration settlement (£2.9m); and 2014 - proﬁt on 
disposal of shareholding in Delcam plc (£26.3m).

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128

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Shareholder information

Subsidiary undertakings

as at 30th June 2014

The following are the subsidiary undertakings of Renishaw plc, all of which are wholly-owned, unless otherwise stated. The country 
of incorporation and registration is England and Wales unless otherwise stated. The country of incorporation is also the country of operation. 
The accounting year end for each subsidiary undertaking is 30th June unless otherwise stated. The shareholdings in all the subsidiary 
undertakings are in the ordinary share capital of those undertakings. 

(cid:36)(cid:80)(cid:78)(cid:81)(cid:66)(cid:79)(cid:90)(cid:1)

Renishaw International Limited

Renishaw (Ireland) Limited (Republic of Ireland)*

Renishaw S.A.S. (France)*

itp GmbH (Germany)*

Wotton Travel Limited

Renishaw Diagnostics Limited (92.4%) (Scotland)

(cid:49)(cid:83)(cid:74)(cid:79)(cid:68)(cid:74)(cid:81)(cid:66)(cid:77)(cid:1)(cid:66)(cid:68)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:74)(cid:70)(cid:84)

Overseas holding and investment company.

Manufacture and sale of advanced precision metrology and 
inspection equipment.

Service, distribution, research and development  and manufacture 
of group products.

Manufacture and sale of advanced precision metrology and 
inspection equipment.

Travel agency.

Design and sale of molecular diagnostics and surface-enhanced 
Raman spectroscopy products. 

Renishaw Mayﬁeld S.A. (75%) (Switzerland)*

Marketing of surgical robots for neurosurgical applications.

Renishaw Mayﬁeld sarl (75%) (France)*

Manufacture and sale of surgical robots for neurosurgical applications.

Renishaw Metrology Systems Limited (India)* (31st March)

Thomas Engineering and Construction Limited
(Canada)* (31st December)

MTT Technologies Limited

Renishaw Software Limited

Manufacture and sale of advanced precision metrology and 
inspection equipment.
Distribution and service of laser scanning equipment.

Manufacture and sale of additive manufacturing and rapid 
prototyping systems.

Development and sale of software solutions.

R&R Fixtures, LLC (USA)* (31st December)

Manufacture and sale of ﬁxturing products.

Advanced Consulting & Engineering, Inc (USA) (31st December)

Supply of dimensional measurement products and services.

(cid:36)(cid:80)(cid:78)(cid:81)(cid:66)(cid:79)(cid:90)(cid:1)(cid:111)(cid:1)(cid:81)(cid:83)(cid:74)(cid:79)(cid:68)(cid:74)(cid:81)(cid:66)(cid:77)(cid:1)(cid:66)(cid:68)(cid:85)(cid:74)(cid:87)(cid:74)(cid:85)(cid:90)(cid:1)(cid:74)(cid:84)(cid:1)(cid:85)(cid:73)(cid:70)(cid:1)(cid:84)(cid:70)(cid:83)(cid:87)(cid:74)(cid:68)(cid:70)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:69)(cid:74)(cid:84)(cid:85)(cid:83)(cid:74)(cid:67)(cid:86)(cid:85)(cid:74)(cid:80)(cid:79)(cid:1)(cid:80)(cid:71)(cid:1)(cid:72)(cid:83)(cid:80)(cid:86)(cid:81)(cid:1)(cid:81)(cid:83)(cid:80)(cid:69)(cid:86)(cid:68)(cid:85)(cid:84)

Renishaw Inc (USA)*

Renishaw KK (Japan)*

Renishaw GmbH (Germany)*

Renishaw S.p.A. (Italy)*

Renishaw Ibérica S.A.U. (Spain)*

Renishaw AG (Switzerland)*

Renishaw Sp. z o.o. (Poland)*

OOO Renishaw (Russia)* (31st December)

Renishaw AB (Sweden)*

Renishaw (Austria) GmbH (Austria)*

Renishaw (Korea) Limited (South Korea)*

Renishaw (Canada) Limited (Canada)*

Renishaw (Hong Kong) Limited (Hong Kong)*

Renishaw (Israel) Limited (Israel)*

Renishaw Latino Americana Ltda. (Brazil)* (31st December)

Renishaw Benelux BV (The Netherlands)*

Renishaw (Shanghai) Trading Company Limited (The People’s Republic 
of China)* (31st December)

Renishaw (Shanghai) Management Company Limited (The People’s 
Republic of China)* (31st December)

Renishaw Oceania Pty Limited (Australia)*

Renishaw (Singapore) Pte Limited (Singapore)*

Renishaw s.r.o. (Czech Republic)*

Renishaw (Taiwan) Inc (Taiwan)*

Measurement Devices (Australia) Pty Limited (Australia)*

Renishaw México, S. de R.L. de C.V. (Mexico)*

129

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

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Subsidiary undertakings continued

as at 30th June 2014

(cid:36)(cid:80)(cid:78)(cid:81)(cid:66)(cid:79)(cid:90)(cid:1)(cid:14)(cid:1)(cid:79)(cid:80)(cid:79)(cid:14)(cid:85)(cid:83)(cid:66)(cid:69)(cid:74)(cid:79)(cid:72)(cid:1)(cid:9)(cid:73)(cid:80)(cid:77)(cid:69)(cid:74)(cid:79)(cid:72)(cid:1)(cid:80)(cid:83)(cid:1)(cid:69)(cid:80)(cid:83)(cid:78)(cid:66)(cid:79)(cid:85)(cid:1)(cid:68)(cid:80)(cid:78)(cid:81)(cid:66)(cid:79)(cid:74)(cid:70)(cid:84)(cid:10)

MTT Investments Limited

MTT Technologies Inc (USA)*

MTT Technologies srl (Italy)*

Measurement Devices Limited

Measurement Devices US LLC (USA)*

Renishaw R&R Inc (USA)*

Renishaw Metrology Limited

Renishaw Transducer Systems Limited

Renishaw PT Limited

Renishaw Advanced Materials Limited

*Equity held by a subsidiary undertaking.

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130

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Shareholder information

Shareholder information

(cid:48)(cid:83)(cid:69)(cid:74)(cid:79)(cid:66)(cid:83)(cid:90)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:84)

(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:83)(cid:70)(cid:81)(cid:80)(cid:83)(cid:85)(cid:84)

The Company has one class of ordinary 20p shares listed on 
the London Stock Exchange under code RSW, ISIN number 
GB0007323586.

(cid:51)(cid:70)(cid:72)(cid:74)(cid:84)(cid:85)(cid:83)(cid:66)(cid:83)(cid:84)

For all enquiries about shareholders’ holdings, transfer and 
registration of shares and changes of name and address, contact the 
Company’s registrars, Equiniti Limited, or use www.shareview.co.uk:

(cid:51)(cid:70)(cid:72)(cid:74)(cid:84)(cid:85)(cid:83)(cid:66)(cid:83)(cid:84)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:85)(cid:83)(cid:66)(cid:79)(cid:84)(cid:71)(cid:70)(cid:83)(cid:1)(cid:80)(cid:71)fic(cid:70)
Equiniti Limited,  
Aspect House,  
Spencer Road,  
Lancing, 
West Sussex, UK.  
BN99 6DA

Telephone: 0871 384 2169 (UK callers) 
+44 121 415 7047 (international callers)

Facsimile: +44 (0)871 384 2100

Website: www.shareview.co.uk

UK calls to 0871 numbers are charged at 8p per minute from 
a BT landline. Other telephony providers’ costs may vary.

(cid:34)(cid:40)(cid:46)

The AGM is held at the Company’s ofﬁces and is open for 
attendance by all shareholders. The 2014 AGM will be held 
on Thursday 16th October at the Company’s headquarters at 
New Mills, Wotton-under-Edge, Gloucestershire GL12 8JR at 12 noon. 
The Notice of meeting is set out in a separate circular to shareholders. 
Shareholders holding shares in the Company through a nominee 
service should arrange to be appointed as a corporate representative 
or a proxy in respect of their shareholding in order to attend and vote 
at the meeting.

The Annual report, together with copies of previous ﬁnancial reports, 
is available at www.renishaw.com. The interim results and the 
preliminary announcement of the full year’s results are published 
on our website promptly after they have been released through a 
Regulatory Information Service.

(cid:39)(cid:74)(cid:79)(cid:66)(cid:79)(cid:68)(cid:74)(cid:66)(cid:77)(cid:1)(cid:68)(cid:66)(cid:77)(cid:70)(cid:79)(cid:69)(cid:66)(cid:83)

(cid:34)(cid:79)(cid:79)(cid:86)(cid:66)(cid:77)(cid:1)(cid:72)(cid:70)(cid:79)(cid:70)(cid:83)(cid:66)(cid:77)(cid:1)(cid:78)(cid:70)(cid:70)(cid:85)(cid:74)(cid:79)(cid:72)
16th October 2014

(cid:41)(cid:66)(cid:77)(cid:71)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)
31st December 2014

(cid:41)(cid:66)(cid:77)(cid:71)(cid:1)(cid:90)(cid:70)(cid:66)(cid:83)(cid:1)(cid:83)(cid:70)(cid:84)(cid:86)(cid:77)(cid:85)(cid:84)
January 2015

(cid:42)(cid:79)(cid:85)(cid:70)(cid:83)(cid:74)(cid:78)(cid:1)(cid:78)(cid:66)(cid:79)(cid:66)(cid:72)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)(cid:1)(cid:84)(cid:85)(cid:66)(cid:85)(cid:70)(cid:78)(cid:70)(cid:79)(cid:85)
May 2015

(cid:39)(cid:74)(cid:79)(cid:66)(cid:77)(cid:1)(cid:69)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)
Ex-div date 17th September 2014

Record date 19th September 2014

Payment date 20th October 2014

(cid:42)(cid:79)(cid:85)(cid:70)(cid:83)(cid:74)(cid:78)(cid:1)(cid:69)(cid:74)(cid:87)(cid:74)(cid:69)(cid:70)(cid:79)(cid:69)(cid:1)(cid:9)(cid:81)(cid:83)(cid:80)(cid:87)(cid:74)(cid:84)(cid:74)(cid:80)(cid:79)(cid:66)(cid:77)(cid:10)
Ex-div date 4th March 2015

Record date 6th March 2015

Payment date 6th April 2015

131

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Registration details and company secr(cid:70)(cid:85)(cid:66)(cid:83)(cid:90)

(cid:56)(cid:66)(cid:83)(cid:79)(cid:74)(cid:79)(cid:72)(cid:1)(cid:85)(cid:80)(cid:1)(cid:84)(cid:73)(cid:66)(cid:83)(cid:70)(cid:73)(cid:80)(cid:77)(cid:69)(cid:70)(cid:83)(cid:84)

(cid:36)(cid:80)(cid:78)(cid:81)(cid:66)(cid:79)(cid:90)(cid:1)(cid:52)(cid:70)(cid:68)(cid:83)(cid:70)(cid:85)(cid:66)(cid:83)(cid:90)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:83)(cid:70)(cid:72)(cid:74)(cid:84)(cid:85)(cid:70)(cid:83)(cid:70)(cid:69)(cid:1)(cid:80)(cid:71)fi(cid:68)(cid:70)
Norma Tang,  
New Mills,  
Wotton-under-Edge,  
Gloucestershire UK  
GL12 8JR

Registered number: 1106260,  
England and Wales

Telephone: +44 (0)1453 524524 
Facsimile: +44 (0)1453 524401 
email: uk@renishaw.com

Renishaw has received reports that our shareholders have received 
unsolicited calls from overseas ﬁrms offering to purchase their shares 
for a price in excess of the current market price in order to mount a 
hostile takeover bid. Please be aware that this is likely to be a scam, 
with the intention of obtaining payment from shareholders of a bond 
or legal fee in order to secure the share transaction, which never 
materialises or obtaining an option to purchase shares with no ﬁxed 
transfer date. There are other types of share fraud or “boiler room 
scams” and therefore if you receive any unsolicited investment advice 
the Financial Conduct Authority (FCA) advises the following:

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and make a record of any other information they give;

For the latest investor information and news, visit www.renishaw.com

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(cid:34)(cid:86)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)(cid:1)(cid:66)(cid:79)(cid:69)(cid:1)(cid:68)(cid:80)(cid:83)(cid:81)(cid:80)(cid:83)(cid:66)(cid:85)(cid:70)(cid:1)(cid:66)(cid:69)(cid:87)(cid:74)(cid:84)(cid:80)(cid:83)(cid:84)

(cid:34)(cid:86)(cid:69)(cid:74)(cid:85)(cid:80)(cid:83)
KPMG LLP

(cid:52)(cid:80)(cid:77)(cid:74)(cid:68)(cid:74)(cid:85)(cid:80)(cid:83)(cid:84)
Norton Rose Fulbright LLP 
Burges Salmon LLP

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UBS

(cid:49)(cid:83)(cid:74)(cid:79)(cid:68)(cid:74)(cid:81)(cid:66)(cid:77)(cid:1)(cid:67)(cid:66)(cid:79)(cid:76)(cid:70)(cid:83)(cid:84)
Lloyds Bank Plc

involved by visiting www.fca.org.uk/register and contacting the ﬁrm 
using the details on the register;

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targeting or have targeted UK investors and any approach from 
such ﬁrms should be reported to the FCA so that the information 
can be kept updated;

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6768 or using the share fraud reporting form on the FCA website 
(search for “share fraud” to ﬁnd the relevant pages); and

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centre Action Fraud on 0300 123 2040 or email@actionfraud.org.uk. 
Action Fraud will be particularly interested if you sent money to a 
bank account or other type of money transfer.

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Shareholdings 

1 – 5,000

5,001 – 25,000

25,001 – 50,000

50,001 – 100,000

%

2.5

2.7

2.0

2.6

100,001 – 500,000

12.1

500,001 – 1,000,000

7.0

1,000,001 – 3,000,000 18.1

more than 3,000,000 53.0

1

2

3

4

5

6

7

8

8

7

6

5

4

3

2

1

Shareholdings 

1 Directors

2 Individuals

3 Institutions

2

%

53.1

1.8

45.1

3

1

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132

(cid:51)(cid:70)(cid:79)(cid:74)(cid:84)(cid:73)(cid:66)(cid:88)(cid:1)(cid:81)(cid:77)(cid:68) Annual report and accounts 2014

Shareholder information

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