Rightmove plc annual report 2012
Britain
moves
at
rightmove
Rightmove plc
Rightmove is the UK’s largest property portal.
Our aim is to be the place for all UK home hunters to find details
of all properties available to buy or rent. The website provides an
easy-to-use but sophisticated online property search. With the
depth of information that it provides, home hunters can
immediately identify a preferred property.
The service is directed at four key membership groups:
• estate agents
• lettings agents
• new homes developers
• overseas homes agents offering properties outside the UK
but interested in advertising to UK-based home hunters.
r i g h t m o v e . c o . u k i s
t h e U K ’s n u m b e r o n e
p r o p e r t y w e b s i t e
Contents
Business review
2 Highlights
Growing traffic
Page 8
Investing in
relationships
Page 12
Corporate governance
3 Key performance
indicators
4 Chairman’s statement 6 Business and
financial review
Continued
product
innovation
Page 10
Building
brand
awareness
Page 14
16 Directors and officers
18 Corporate social
responsibility
20 Directors’ report
23 Corporate governance
30 Remuneration report
45 Auditor’s report
Financial statements
46 Consolidated
statement of
comprehensive
income
47 Consolidated
48 Company statement
of financial position
49 Consolidated
statement of
cash flows
statement of financial
position
50 Company statement
of cash flows
51 Consolidated
statement of changes
in shareholders’ equity
52 Company statement
of changes in
shareholders’ equity
53 Notes forming part
of the financial
statements
84 Advisers and
shareholder
information
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Highlights
• Revenue increased by 23% to £119.4m (2011: £97.0m)
• Underlying operating profit(1) increased by 26% to £87.5m (2011: £69.4m)
• Underlying operating margin(1) up to 73.3% (2011: 71.5%)
• Underlying basic earnings per share(1) up 31% to 65.7p (2011: 50.3p)
• Diluted earnings per share(2) up 40% to 59.2p (2011: 42.3p)
• 4.5m shares bought back during 2012 (2011: 4.4m) at an average price
of £14.70 (2011: £11.10)
• Final dividend of 14.0p (2011: 11.0p) making a total dividend of 23.0p
for the year (2011: 18.0p), up 28%
• Average revenue per advertiser (ARPA) up 19% to £529 per month
(2011: £443 per month)
• Site traffic up 18% to 11.0bn pages (2011: 9.3bn pages)
Revenue
Profit
Dividend
+23%
Revenue up to £119.4m
(2011: £97.0m)
+26%
Underlying operating profit(1)
increased to £87.5m (2011: £69.4m)
+28%
Final dividend 14.0p
Total dividend 23.0p
(1) From continuing operations before share-based payments, NI on share-based incentives and no related adjustment for tax.
(2) From continuing operations.
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Focus areas
Leading our market
Investing in technology
Supporting our customers
Building our brand
Key performance indicators
Market share
Number of advertisers
Page impressions
82%
of the market share of the top 3 UK
property websites by pages viewed,
2% down on 2011
Source: Experian Hitwise and Rightmove:
December 2012 and December 2011
18,270
Total membership at end of 2012
was 18,270 (2011: 18,276),
flat year on year
Properties displayed
Enquiries
1.1million
properties on rightmove.co.uk
at 31 December 2012
unchanged since 2011
21.2 million
Enquiries up from 19.6 million
in 2011
11.0 billion
page impressions up from
9.3 billion in 2011
Source: Rightmove
Average revenue
per advertiser
£529
per month, up 19% on 2011
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Chairman’s statement
Scott Forbes
Chairman
I am pleased to present Rightmove plc’s results for the year
ended 31 December 2012.
Online advertising is changing consumer behaviour
across many markets and transforming the way businesses
communicate with consumers. Rightmove has driven the
transformation in online property advertising which has been
a boon to home movers as they are the beneficiaries of
greater and more timely access to better quality information.
The pace of change is continuing with the rapid growth of the
mobile internet, meaning that home movers now have instant
access to information on Rightmove irrespective of whether
they are at home, in the office or on the move. At the same
time, online advertising has enabled property professionals
to operate more cost effectively and improve their consumer
reach at a time when housing transaction volumes have
remained at around 60% of average historic levels.
I would like to express my thanks to our customers and also
to our employees who continue to bring their skills and efforts
to bear to make Rightmove the best place for home hunters
to find their next home and for property advertisers to reach
the widest possible audience.
The Board of Directors
30 April 2013 marks the end of Ed Williams’ 13 impressive
years of accomplishment at the helm of Rightmove. It has
been very much a business partnership with Nick McKittrick,
currently Chief Operating Officer and Finance Director and
successor to Ed as Chief Executive Officer. I speak on
behalf of the Board and all employees when I say that we
will miss Ed on both a personal and professional level and
have greatly appreciated his valuable contributions to
Rightmove’s success.
Rightmove is proud that it continues to be at the forefront
In Nick, we have a strong and experienced successor
of online property advertising. In January 2013 Rightmove
ranked as the sixth most popular website in the UK amongst
global brands such as Google and Facebook, once again
demonstrating that ‘Britain moves at Rightmove’. We are
proud of the compelling value proposition that Rightmove
and our brand creates for our customers. We will continue
to offer an increasing number of brand building and property
advertising options to help our customers take advantage
of the internet’s ability to deliver advertising with unrivalled
consumer reach at a fraction of historic cost levels.
who joined Rightmove in 2000 along with Ed. A long
standing member of the Board since March 2004, he
became Chief Operating Officer and Finance Director in 2009.
Congratulations also to fellow director Peter Brooks-Johnson
and to Robyn Perriss for their long-standing achievements
meriting appointment as Chief Operating Officer and Finance
Director, respectively.
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A total of £86.8m was returned
to shareholders through dividends
and share buybacks, bringing the
total returned since our flotation in
2006 to £293m.
In 2012 we have undertaken a full external Board evaluation.
The evaluation was interview based and covered strategy,
organisation, culture and Board composition and
effectiveness. The findings were presented at the December
2012 Board meeting and further detail on this is shown
on page 25.
Financial results
2012 set new records for revenue, profits and underlying basic
earnings per share (EPS)(1). Underlying operating profit(1) was
up 26% to £87.5m (2011: £69.4m) driven by strong organic
revenue growth of 23% coupled with continued careful cost
management. EPS was up 31% to 65.7p (2011: 50.3p)
with the increase being helped by the repurchase of 4.5m
(2011: 4.4m) shares. As at 31 December 2012 the cash
position was £7.1m (2011: £21.8m).
Investors
Our investors have benefited from our strong performance
and our clear and continued policy of returning all excess
cash. Our cash conversion remains in excess of 100% of
operating profit and in 2012 we returned a further £86.8m
(2011: £65.1m) to shareholders through dividends and share
buybacks. This brings the total returned to shareholders since
our flotation in March 2006 to £293.0m.
Dividend
The Board previously announced that it would increase the
interim dividend to 9.0p (H1 2011: 7.0p) per ordinary share,
which was paid on 9 November 2012. Consistent with our
policy of increasing the total dividend for the year broadly
in line with underlying operating profits, the Board proposes
to pay a final dividend of 14.0p (2011: 11.0p) per ordinary
share for a total dividend for the year of 23.0p (2011: 18.0p),
an increase of 28%. The final dividend, subject to shareholder
approval, will be paid on 7 June 2013 to all shareholders on
the register on 10 May 2013.
Outlook
With healthy growth in average spend per advertiser at
the start of the year and assuming there is no significant
deterioration in the UK housing market, the Board remains
confident of continued growth in the business in 2013.
Scott Forbes
Chairman
(1) From continuing operations before share-based payments, NI on share-based incentives and no related adjustment for tax.
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Business and financial review
Ed Williams
Chief Executive Officer
Nick McKittrick
Chief Operating Officer
and Finance Director
Our position, at the heart of home moving, comes from a
focus on providing the best internet platforms for buyers,
sellers, tenants and landlords backed by more than a decade
of investment in the Rightmove website and infrastructure,
product innovation, continuous promotion of the Rightmove
brand and actively supporting our property advertising clients.
The Rightmove business strategy is to focus on organic
growth through serving property advertisers seeking to reach
the largest audience of UK home movers. For our advertisers
we want to be their largest source of high quality enquiries
and, in the case of estate agents and lettings agents, an
important element of their own service offering to home sellers
and landlords. Our shareholders benefit from our clear and
continued policy of promptly returning the cash generated
by the business through dividends and share buybacks.
Revenue, profit and earnings per share (EPS) all rose
significantly in 2012 compared to 2011, making it a record
year on all of these metrics. The majority of the increase in
revenue came from our existing customers spending more on
advertising with us. The number of customers advertising on
Rightmove ended the year unchanged, reflecting the stable
nature of the current housing market and Rightmove’s high
market penetration.
2012 results
Profit after tax(2) increased 36% to £62.6m (2011: £46.1m).
Underlying operating profit(1) was up 26% to £87.5m
(2011: £69.4m). Organic revenue growth drove overall
revenue to £119.4m (2011: £97.0m) which is up £22.4m
(23%) on the prior year, and with our underlying cost base(1)
rising by only £4.2m (15%) we have again demonstrated the
scalability and profitability of the Rightmove business model.
What we do and the keys to success
Rightmove provides estate agents, lettings agents and new
homes developers access to the largest audience of UK
home movers by enabling them to advertise all of their
properties on the rightmove.co.uk website and mobile
platforms for a monthly subscription fee. Customers can also
take advantage of a wide set of advertising products to better
promote their properties, brand and proposition. Rightmove’s
success comes from its market leading position with UK
home movers and the value we add to our customers by
giving them the ability to reach the largest audience of UK
home movers.
We believe the foundations of our success come from:
• sustained investment in serving home movers
• sustained investment in our brand
• sustained support for our advertisers
• innovation in advertising products and internet platforms.
Sustained investment in serving home movers
Home movers use Rightmove because it represents the
easiest and most familiar way in which to view the best
information about properties that are currently available on the
market and those that have sold in the last 10 years. The ease
of use and quality of information we provide to home movers
results not just from the scale of our investment in our website
and mobile apps but also from the experience we have built
up over more than a decade.
We continuously invest in developing the most engaging
website and apps for home movers, releasing over 2,500
enhancements in 2012. Traffic grew by 18% with more than
11.0 billion pages being viewed across all of our platforms
during the year. We continue to be ranked in the top 10
most popular websites in the UK and as high as sixth in
January 2013 (behind Google, Facebook, YouTube, eBay
and Amazon).
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Rightmove’s strategy is to focus
on organic growth through serving
property advertisers seeking to
reach the largest audience of UK
home movers.
The continued rise in mobile access to the internet means
that a third of Rightmove property searches are now regularly
performed on mobile devices as millions of Britons have
downloaded our popular apps. To support this growing
trend in 2012 we launched an Android app, released major
enhancements to our iPhone and iPad apps and are launching
the latest version of our mobile website in early 2013.
We also strive to deliver the best quality information to
our audience. In 2012 we launched a unique facility which
matches Land Registry sold prices with our catalogue of over
two billion property images to help home movers with their
research. We have also invested in a team of data quality
experts to ensure the information on Rightmove is the most
accurate available on any property portal.
We further enhanced our commercial property website
during 2012 and with over 2 million commercial property
searches per month we have established ourselves as the
leading commercial property website in the UK with over 80%
market share of traffic. Although small in the overall context of
Rightmove revenues, this area provides an opportunity for
further growth.
Sustained investment in our brand
Our strong brand recognition with the public and the
simplicity of the core service we provide have made Rightmove
the public’s first choice to help them find their next home.
Much of our success comes from the positive experience that
home hunters have in using the services we provide.
Nonetheless, we work hard to promote the brand in order
to build on more than 10 years of investment. We continued
with TV advertising in 2012 with campaigns running in six
months of the year and into 2013. A new campaign, building
on the ‘Britain Moves at Rightmove’ theme is to be launched
in Spring 2013, reflecting the fact that the Rightmove website
is a place where people dream (and daydream) about where
they want to live.
Recognising the changing way in which people consume
media, we have used online videos to promote key features
of Rightmove. The Market Intelligence campaign which ran in
the second half of 2012 used interactive video, customised
to a home mover’s postcode, to bring to life Rightmove’s
property research tools.
We continue to receive around four out of five visits to our
website from people typing in the ‘Rightmove’ name, using
our mobile apps, responding to our email alerts, or using
unpaid links from other sites. The remainder come from
organic search.
Social media sites such as Facebook and Twitter
continue to be a successful way to promote Rightmove.
‘Likes’, ‘Shares’ and ‘Retweets’ extend the reach of the
Rightmove brand by over half a million users every month.
This interaction is promoted both by close integration on the
Rightmove site itself and bespoke social media campaigns
such as the ‘12 Days of Christmas’ competition, which
attracted over 50,000 entries.
Sustained support for our advertisers
The marketing of properties for sale and to rent is critical to
the success of Rightmove’s own customers leading to our
focus on providing them with the best way to advertise to
UK home movers.
Rightmove also devotes considerable effort to helping
our customers be more successful in ways other than just
advertising. Much of this is through individual day-to-day
support and advice from our local and telephone-based
account managers. Both 2012 and early 2013 have been
notable for the number and range of other activities we have
undertaken to help our customers to be more successful.
As tablet computing becomes more prevalent, more vendors
expect agents to show that they understand the benefits new
technology can bring through the tools they use, as well as by
the information they provide. The Rightmove iPad presenter
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Growing
traffic
rightmove.co.uk is now ranked as
the 6th most popular UK website
by page impressions.
(Source: Experian Hitwise, January 2013)
Mobile searches
30%
of Rightmove property
searches are now performed
on mobile devices.
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Business and financial review continued
Market share of top 3 UK property
websites by pages viewed
82%
Source: Experian Hitwise and Rightmove,
December 2012
Over £15m of our revenue
in 2012 was from products
launched in the last three years.
app helps agents present their marketing material in the
homes of potential vendors using an iPad. The tool also helps
larger customers ensure that their staff are using the latest
version of the marketing material.
Rightmove launched the ‘Little Blue Book of property
trends’ in 2012. This biannual publication brings together
trends and expert opinion from a number of sources as a
resource for all property professionals. We also continued
our programme of free seminars to agents and developers
and over the past four years have presented to over 9,500
attendees across more than 100 locations.
Using Rightmove’s position at the heart of home moving
in the UK, we have launched a series of reports for agents,
allowing them to gather feedback on their service from their
clients. We have also built the facility to enable agents to track
their performance on this against their nearest competitors on
an anonymous basis.
Innovation in advertising products
2012 saw the official launch of the Local Valuation Alert
service. Advertisers taking this service can promote
themselves directly to prospective sellers of homes and
raise their brand awareness with a key local audience.
The product made a significant contribution to revenue
growth during 2012.
We also launched Agent Microsites for lettings agents and
prepared for the launch of our Estate Agent Microsite product
at the start of 2013. Agent Microsites operate in a similar way
to eBay Shops. They allow our advertisers a high quality
way to promote all aspects of their proposition, not just the
properties they currently have available. This can include
testimonials, profiles of members of staff as well as properties
recently sold or rented. Through a Rightmove microsite an
agent can significantly enhance the quality of its presentation
to the Rightmove audience and, should they wish, also save
themselves the cost of their own website by pointing their
URL to the microsite.
In financial terms, 32% of our agents and new home
developers spending is now on the enhanced advertising
products that we started to introduce in 2007. Over the last
two years we have seen spend on these products more than
double. We expect to see the proportion of total spend
accounted for by these and future similar products continue
to rise in the coming years.
Whilst Rightmove’s main focus in terms of innovation is on
property advertising products, 2012 also saw considerable
development and commercial success for our data services
business. Of particular note was the development, launch and
widespread adoption of our service to surveyors, providing
them with data on comparables (i.e. other properties which
provide a reference point for property valuations).
Uncertainties, threats and risks
The Rightmove business model has proven remarkably
resilient in the face of a depressed UK property market.
The number of estate agents, lettings agents and new
home developments is a major determinant of Rightmove’s
revenues, and has remained stable from 2009 onwards. We
do not believe the number of agents or developments is likely
to decline further unless there is another material downturn in
the market.
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Continued product
innovation
During 2012 we launched our ‘Local Valuation Alert’
service allowing advertisers to promote themselves
directly to prospective sellers of homes and raise
their brand awareness with a key local audience.
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Enhanced advertising products
32%
of our agents’ and developers’
spend is now on enhanced
advertising products.
Business and financial review continued
Underlying operating profit and margin
Revenue
71.3
64.5
120
100
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£
80
60
40
20
0
Margin 57.8
62.9
69.4
119.4
97.0
81.6
100
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i
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£
80
60
40
20
0
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56.6
41.2
40.6
Underlying basic EPS
71.5
73.3
70
87.6
69.4
The ongoing growth of Rightmove
revenue is expected to continue
to be driven by existing customers
increasing their spend.
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29.6
39.8
50.3
23.7
20
30
40
50
60
i
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p
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P
10
0
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
100
80
100
40.6
73.3
87.6
69.4
71.5
56.6
62.9
69.4
Underlying operating profit
and margin
The ongoing growth of Rightmove revenues is expected
to continue to be driven by existing customers increasing
their spend on Rightmove. This, however, depends on
Rightmove’s continued success in generating high quality
enquiries, the continued shift of spend from offline to online,
the competitive environment within the online sector and our
80
ability to continue to innovate.
62.9
60
57.8
In April 2012 the Office of Fair Trading approved the
41.2
40.6
40
merger of DMGT’s Digital Property Group (operator of the
20
Find A Property and Prime Location websites) and Zoopla,
0
a privately owned, private equity backed business. In
2011
September, the new business closed the Find A Property
website, having previously redirected its marketing focus to
the Zoopla brand. At the start of 2013 DMGT also sold its
remaining property website, Globrix, to the new business,
which proceeded to close Globrix. The result is a single larger
competitor. However, throughout 2012 Rightmove’s market
Revenue
share was essentially unchanged.
62.9
Margin 57.8
2012
2008
2009
2008
2009
2010
41.2
57.8
m
£
s
n
o
20
40
60
i
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l
i
0
100
Due to the simplicity of the Rightmove business, we
believe that the risks relating to operational failures, financial
and legal exposures, fraud, or from onerous commercial
obligations or liabilities are limited. The business has few
tangible assets and the major intellectual assets are
embedded in the design of our website and our brand
identity, recognition and reputation.
2012
2010
2009
2008
2011
2008
2009
m
£
s
n
o
80
40
20
60
i
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l
i
0
s
n
o
i
l
l
i
m
£
120
100
s
n
o
i
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l
i
m
£
80
60
40
20
0
Financial position
Underlying operating profit
and margin
71.5
69.4
73.3
87.6
Revenue
Revenue(2) increased in 2012 by 23% to £119.4m
(2011: £97.0m). Our Agency business was the largest
contributor to the revenue growth with a year on year
increase of £15.0m (2011: £13.6m). The majority of the
growth has come from a combination of sales of additional
advertising products and increases to core membership
prices. Agency continues to be by far our largest business
although its proportion of total revenue has declined slightly
in the year to 77% (2011: 80%) reflecting the success of
other business areas during the year.
2011
2012
Revenue from the New Homes business grew by 22% to
69.4
56.6
2010
£20.6m (2011: £16.9m) despite a decline in development
numbers. Growth was driven by the sale of additional
advertising products including e-mail campaigns and by
increases to core membership prices.
Underlying basic EPS
71.5
73.3
69.4
Notably other revenue grew to £6.4m (2011: £2.8m) due
to a number of contract wins, including some one-off work,
within our Data Services business.
e
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s
50
70
60
Underlying operating profit and margin
2010
2012
2011
Margin growth
20
The underlying operating margin(1) for the year increased
10
from 71.5% to 73.3%. This has been driven by continued
0
2011
strong revenue growth coupled with a lower percentage
increase in underlying operating costs(1). Underlying operating
costs(1) increased by £4.2m to £31.8m (2011: £27.6m)
with £2.0m of the increase relating to salary costs due to
a combination of an increased average headcount of 325
Underlying operating profit and margin
(2011: 293), up 11% and wage inflation.
2008
2009
2010
2012
Underlying operating profit
and margin
Underlying operating profit
and margin
100
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80
60
40
20
0
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
Underlying operating profit
Underlying operating margin
87.6
69.4
56.6
57.8
62.9
69.4
71.5
73.3
100
80
60
40
20
0
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£
41.2
40.6
100
80
60
40
20
0
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i
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£
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
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Investing in
relationships
Our seminars aim to help our members
to become more successful and to get
more from their Rightmove membership.
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Seminars
9,500 customers
presented to in the last four years
across more than 100 locations.
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Revenue
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Business and financial review continued
Revenue
Underlying operating profit(1)
Underlying basic EPS
119.4
97.0
81.6
71.3
64.5
100
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i
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£
80
60
40
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87.5
69.4
56.6
41.2
40.6
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39.8
29.6
23.7
65.7
Cash conversion was in excess
of 100% of operating profit.
50.3
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
Statement of financial position
The Group’s statement of financial position reflects total
equity of £7.5m at 31 December 2012 (2011: £24.7m). The
reduction in total equity of £17.2m is a function of us returning
cash to shareholders in the form of share buybacks and
dividends of £86.8m in excess of the profit after tax of
£62.6m. This was offset by some cash benefits, in the form
of proceeds on the exercise of share-based incentives and
corresponding tax deductions taken directly to equity.
In line with stronger revenues, trade receivables in current
assets increased by 22% to £16.0m (2011: £13.1m).
Trade and other payables increased by £2.8m to £23.7m
(2011: £20.9m) due to the timing of marketing and technology
spend, coupled with an increase in deferred revenue.
Our deferred tax asset, representing future tax benefits from
share-based incentives, is lower at £9.7m (2011: £10.7m) due
to a combination of share-based incentive exercises in the
year and a reduction in the future tax rate from 25% to 23%.
Cash flow and net debt
Cash generated from operating activities was £86.1m
(2011: £67.7m). Cash conversion was in excess of 100%
of operating profit.
Tax payments increased to £14.6m (2011: £14.3m) and
£0.1m (2011: £0.1m) was paid in relation to bank charges
2010
and facility fees resulting in net cash from operating activities
of £71.4m (2011: £53.3m).
2011
2012
Capital expenditure was £2.1m (2011: £0.5m). The higher
expenditure in 2012 reflected increased investment in both
hardware and software utilised in the running of our website
and expenditure on our new office premises in Milton Keynes
and the refurbishment of our London office. We continue to
charge development costs directly to the income statement.
Proceeds of £3.0m (2011: £6.1m) were received on the
exercise of share-based incentives.
Underlying operating profit
and margin
69.4
56.6
71.5
69.4
87.6
73.3
57.8
41.2
62.9
40.6
2008
2009
2010
2011
2012
100
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Taxation
The consolidated tax rate from continuing operations for the
Underlying operating profit
year ended 31 December 2012 was 24.8% (2011: 26.6%).
and margin
The effective tax rate was marginally higher than the enacted
rate of 24.5% due to a reduction in the rate at which deferred
87.6
tax is recognised and disallowable expenditure.
69.4
69.4
71.5
73.3
57.8
62.9
56.6
40.6
Share-based payments and national insurance
41.2
In accordance with IFRS 2, a non-cash charge of £2.4m
(2011: £2.3m) is included in profit or loss representing
the amortisation of the fair value of share-based incentives
2011
granted, including Sharesave options, since 2006.
2012
2008
2009
2010
Employer’s NationaI Insurance (NI) is being accrued, where
applicable, at a rate of 13.8% on the potential employee gain
on share-based incentives granted. Based on a closing share
price at 31 December 2012 of £14.36 in respect of the
Underlying operating profit and margin
outstanding share-based incentives granted, together with
the actual NI cost on share-based incentives exercised in the
year, there is a charge of £2.0m (2011: £4.4m).
70
60
69.4
62.9
71.5
73.3
Underlying basic EPS
Margin 57.8
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Net financial expenses
A net financial credit of £0.1m (2011: £0.1m) was recorded,
being interest income on cash balances, offset by bank
charges and fees in relation to our Barclays Bank Plc money
market facility.
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Earnings per share
Underlying basic EPS(1) increased by 31% to 65.7p
(2011: 50.3p). Diluted EPS(2) increased by 40% to 59.2p
(2011: 42.3p). The growth in EPS was helped by our share
Underlying operating profit
and margin
buyback programme which reduced the weighted average
number of ordinary shares in issue to 102.0m (2011: 104.8m).
Underlying operating profit and margin
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
2008
2009
Underlying operating profit
and margin
100
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40
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100
s
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£
80
60
40
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2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
Underlying operating profit
Underlying operating margin
87.6
69.4
56.6
57.8
62.9
69.4
71.5
73.3
100
80
60
40
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£
41.2
40.6
100
80
60
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£
2008
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2012
2008
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Building brand
awareness
We use social media to engage
directly with home movers and
to build our brand.
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Social media use
Likes, Shares
and Retweets
extend the reach of the Rightmove
brand by over half a million users
every month.
Business and financial review continued
Revenue
71.3
64.5
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Underlying operating profit and margin
Margin 57.8
62.9
69.4
71.5
73.3
Underlying basic EPS
119.4
97.0
81.6
87.6
69.4
56.6
41.2
40.6
39.8
29.6
23.7
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50.3
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2012
2008
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2010
2011
2012
Most of our EPS increase has come
from organic growth but it has also
been helped by a reduced number
of shares.
Underlying operating profit
and margin
Underlying operating profit
and margin
69.4
56.6
71.5
69.4
87.6
73.3
57.8
41.2
62.9
40.6
87.6
69.4
69.4
71.5
73.3
57.8
62.9
56.6
41.2
40.6
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
Underlying operating profit and margin
Margin 57.8
62.9
69.4
71.5
73.3
A total of £66.4m was invested during 2012 in the repurchase
of our own shares (2011: £48.3m) whilst a further £20.4m
was paid in dividends (2011: £16.8m). This brings the total
returned to shareholders since our flotation in March 2006
to £293.0m.
The Group entered into a 12 month agreement with
Barclays Bank Plc for a £10.0m uncommitted money market
loan on 6 February 2013. To date no amount has been drawn
under this facility.
As a result of the cash movements noted above, net cash
at 31 December 2012 was £7.1m (2011: £21.8m). The Board
is confident that with the existing cash resources and banking
facilities in place, the Group and the Company will remain
cash positive and will have adequate resources to continue
in operational existence for the foreseeable future.
The Board’s priorities for the usage of cash continue to
be: investment in the business; payment of dividends; and
Underlying basic EPS
the return of cash to shareholders via share buybacks. The
Board believes that the future working capital and capital
expenditure requirements of the business will continue to
be low and that the business will be in a position to return
surplus cash to shareholders during 2013 through a
combination of dividends and share buybacks.
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Current trading and outlook
The outlook for the UK online property advertising market
continues to be positive, albeit tempered by a challenging UK
housing market. The market for online advertising continues
to grow and Rightmove is well positioned to benefit through
increased adoption of its existing advertising products,
further product innovation, pricing and market-leading
brand awareness.
Activity across our website and mobile platforms has
started the year strongly, with traffic up 20% on the same
period in 2012. Overall advertiser numbers continue to be
broadly flat and average spend per advertiser has started
the year ahead of 2012 levels.
Subject to there being no further significant downturn
in the UK housing market, the Board remains confident of
making further progress in growing the business organically
in 2013 and beyond.
Ed Williams
Chief Executive Officer
Nick McKittrick
Chief Operating Officer and
Finance Director
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
2008
2009
2010
2011
2012
Underlying operating profit
and margin
Underlying operating profit
and margin
Underlying operating profit and margin
100
s
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£
80
60
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2009
2010
2011
2012
2008
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2010
2011
2012
2008
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2010
2011
2012
(1) From continuing operations before share-based payments, NI on share-based incentives and no related adjustment for tax.
(2) From continuing operations.
Revenue
120
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Underlying operating profit
Underlying operating margin
87.6
69.4
56.6
57.8
62.9
69.4
71.5
73.3
41.2
40.6
100
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40
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2008
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15
Directors and officers
Scott Forbes
Chairman
Scott was appointed Chairman of
Rightmove in 2005. He is also the
Chief Executive of Bridge Capital
Advisors Ltd, which he founded in
2007, and was a director of NetJets
Management Ltd, a subsidiary of
Berkshire Hathaway until October
2009. Scott has over 30 years’
experience in operations, finance
and mergers & acquisitions, which
includes 15 years at Cendant
Corporation, which was formerly
the largest worldwide provider of
residential property services. Scott
established the Cendant international
headquarters in London in 1999 and
led this division as Group Managing
Director until he joined Rightmove.
(Appointed 13 July 2005.)
Jonathan Agnew
Non-executive Director
Jonathan joined the Board in 2006
as Senior Independent Director. He is
Chairman of The Cayenne Trust and
Ashmore Global Opportunities.
Jonathan was an investment banker
for over 25 years, including being a
Managing Director of Morgan Stanley
and Group Chief Executive of Kleinwort
Benson. He has been Chairman of
Nationwide Building Society, Limit,
Gerrard Group, LMS Capital and
Beazley and has served on the Council
of Lloyd’s. (Appointed 16 January
2006.) (Chairman of the Remuneration
Committee and a member of the
Audit and Nomination Committees.)
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Ed Williams
Chief Executive Officer
Ed joined Rightmove in 2000 as
Managing Director at its inception.
He is also a non-executive director
of Trader Media Group, owner of the
UK’s leading motoring website.
His prior experience is in business
strategy and IT consulting with
McKinsey & Co, Accenture and
JPMorgan. Ed has announced his
retirement from the Board in April 2013.
(Appointed 19 December 2000.)
Ashley Martin
Non-executive Director
Ashley joined Rightmove in 2009 as a
non-executive director and also as
Chairman of the Audit Committee, where
he provides oversight of the financial
reporting practices, internal control
environment and compliance with the
various listed company regulations. He is
also a member of the Remuneration
Committee. He qualified as a chartered
accountant in 1981 and has a career in
finance spanning 30 years. Ashley is
currently Group Chief Financial Officer of
The Engine Group, a private equity
backed international marketing services
group. He was previously Finance
Director of Rok plc, the building services
group, and Group Finance Director of the
media services company, Tempus plc.
(Appointed 11 June 2009.) (Chairman of
the Audit Committee and member of the
Remuneration Committee.)
Judy Vezmar
Non-executive Director
Judy joined Rightmove in 2006 as a
non-executive director. She is Chief
Executive Officer of LexisNexis
International. LexisNexis®, part of the
global media group Reed Elsevier PLC,
is a leading worldwide provider of
content-enabled workflow solutions
designed specifically for professionals
in the legal, risk management,
corporate, government, law
enforcement, accounting and
academic markets. Judy is responsible
for the International Group and their
expansion of the range of successful
solutions including online services to
over 100 countries. She is based in
London. (Appointed 16 January 2006.)
(Member of the Audit, Remuneration
and Nomination Committees.)
Nick McKittrick
Chief Operating Officer and
Finance Director
Nick is a co-founding executive having
joined Rightmove in 2000. He led the
build of Rightmove’s original website
and started the new homes, lettings
and overseas businesses. In 2005,
he became the Managing Director of
rightmove.co.uk and in 2009 he was
promoted to Chief Operating Officer
and Finance Director. Before joining
Rightmove he worked for Accenture
for eight years in the technology
consulting division. Following Ed
Williams’ retirement in April 2013,
Nick will step up to become Chief
Executive Officer. (Appointed to the
Board 5 March 2004.)
Peter Brooks-Johnson
Managing Director, rightmove.co.uk
Peter joined Rightmove in 2006 and
developed the Home Information Packs
proposition. His focus subsequently
shifted to the operation of the
rightmove.co.uk website. He then
went on to lead, from the beginning
of 2008, the estate agency business.
Peter was promoted to the role of
Managing Director of rightmove.co.uk
on his appointment to the Board
on 10 January 2011 and now leads
the main operating business. Prior
to joining Rightmove, Peter was
a management consultant with
Accenture and the Berkeley
Partnership. Following Ed Williams’
retirement in April 2013, Peter will take
over the role of Chief Operating Officer
from Nick McKittrick. (Appointed to the
Board 10 January 2011.)
Colin Kemp
Non-executive Director
Colin was appointed to the Board in
2007. With over 30 years’ experience
in high street retail banking, Colin has
worked for Lloyds Banking Group
companies since 1979. Between
January 2005 and December 2007,
Colin was Managing Director of Halifax
Estate Agencies Limited and is currently
the Managing Director of Telephone
Banking for the Lloyds Banking Group,
Retail Business. Colin is a Cranfield
MBA and an Associate of the
Chartered Institute of Marketing.
(Appointed 3 July 2007.)
Robyn Perriss
Company Secretary and
Financial Controller
Robyn joined Rightmove in 2007
and has day-to-day responsibility
for the financial operations, based
in Milton Keynes, as well as statutory
reporting and treasury functions.
She was formerly Group Financial
Controller at the online media
business, Trader Media Group. She
qualified as a chartered accountant in
South Africa with KPMG. Robyn was
appointed as Company Secretary in
April 2012 and following Ed Williams’
retirement on 30 April 2013, it is
proposed that Robyn will be
appointed Finance Director.
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Corporate social responsibility
Our people
Our people are our most highly valued asset, they are
critical to our success and our growth. We are proud of our
people and the mixture of talent and experience that they
bring. We depend on their skills and commitment to achieve
our objectives.
Our cultural style is open and honest. We invest in
ensuring that all employees understand Rightmove’s core
values and goals. We achieve this through a combination of
a rigorous selection process, including technical skills testing,
an off-site residential course to ensure all ‘Rightmovers’
understand our core values, ongoing coaching and
mentoring, and cross-functional team building events
involving all employees. We encourage employee involvement
and place emphasis on keeping employees informed of the
Group’s activities via bi-monthly staff forums and business
performance updates with senior management and quarterly
sales conferences.
We continue to offer our Rightmover-led training academy,
designed to provide a structured means for employees to
expand and diversify their skills and knowledge and explore
new ways of working with one another. Given the specialised
technical nature of the work we do and the services we
provide, we also support ongoing external professional
development where appropriate.
During 2012, we introduced an employee recognition
scheme, which is voted on by other employees and is an
opportunity to nominate colleagues who have shown
outstanding performance or are high achievers. Up to eight
awards are presented every two months at our bi-monthly
staff forums.
We offer employees a range of additional benefits, which
have proved to be a useful retention tool. Rightmovers are
made aware of these benefits through our induction process
and intranet. In 2012 we placed particular emphasis on
communicating the importance of saving for retirement and
promoting the stakeholder pension plan we established in
2008 as well as the option to save by salary exchange.
47% of employees are now members of the pension plan.
We did this by holding employee seminars and offering the
opportunity for one to one briefings with external benefits
advisers. We also offer private healthcare complemented by a
cash back scheme. In November 2012, the Company’s fourth
Sharesave contract matured, allowing employees to benefit
from the success of the Group over the last three years. More
than half of our employees currently participate in the
Sharesave plan.
In March 2012, we moved to new offices in Milton Keynes,
providing our employees with a workplace environment which
is spacious, inspiring and fun. We also refurbished our
London premises as part of our continued investment in
employee wellbeing.
Rightmove has a strong commitment to equality of
opportunity in all our employment policies, practices and
procedures. We take a proactive approach throughout our
recruitment and selection process to ensure that we attract,
hire and retain a diverse and talented workforce and this is
kept under close and regular scrutiny. No existing or potential
employee will receive less favourable treatment due to their
race, creed, nationality, colour, ethnic origin, age, religion or
similar belief, connections with a national minority, sexual
orientation, gender, gender reassignment, marital status,
member or membership of a trade union, disability, or any
other classification as prescribed by law.
We offer flexible working arrangements, supporting
part-time working and reduced hours to allow our employees
to balance their work and family commitments. In 2012, 6%
of our employees worked flexible hours.
Charitable activity
We continue to encourage all our employees to devote time
and fundraising efforts to charitable causes of particular
importance to them as individuals. During 2012 many of
our staff have been active in raising money or supporting
fundraising activities across a wide range of charities for
which Rightmove matched the donations raised.
We have also set up charitable giving through the Charities
Trust, a scheme that allows our employees to donate directly
from their monthly salary to any charity or recognised good
cause registered within the UK. This provides a tax efficient
means of giving.
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Environment
Rightmove actively considers its environmental impact
and we are conscious of playing our part in tackling climate
change. Since our operations are primarily office-based,
the direct environmental impact is relatively low. Indeed
Rightmove’s business reduces the overall environmental
harm associated with a variety of aspects of the whole
home hunting process.
Traditional ways of finding a home tend to involve large
amounts of paper and printing, whether in the form of
newspaper advertising, property particulars mailed to
applicants through the post or leaflet drops by agents.
Rightmove reduces the need for print media and the
environmental damage that goes with them. Rightmove takes
care to design the layout of property particulars to reduce the
total number of pages that need to be printed out in those
cases where a home hunter does want a physical copy.
Enhanced information on properties also reduces the
amount of time home hunters waste in visiting properties
that rapidly turn out to be inappropriate. As a high proportion
of viewings involve a car journey, any reduction in wasted
viewings has an environmental benefit. Rightmove has
worked hard to increase the number and size of photographs
of each property and has introduced more comprehensive
map searches and aerial photographs which help home
hunters to identify the specific location of a property.
The higher the quality of the information presented about
properties, the less carbon footprint is generated by
prospective buyers making wasted journeys.
The rightmove.co.uk website includes functionality for
our customers to display Energy Performance Certificates
which allow prospective buyers to evaluate the energy
efficiency of a property they are considering buying and to
identify opportunities to improve the energy efficiency once
they have purchased the property.
As an internet-based Group with most staff employed in
two office locations, we believe our own environmental
footprint is small. We encourage our staff to take steps to
address our environmental responsibilities. For instance,
we continue to operate recycling schemes which were
established in consultation with local authorities and recycling
partners and when we moved to our new office in Milton
Keynes, we removed all waste bins from desks, which
encourages and increases the amount of recycling we do.
We subsequently introduced this into the London office.
As an operator of an online property portal, the main
environmental impact is the power usage of our data centres.
Our procurement policy is to purchase hardware with the
best computational performance which uses the least
electrical power.
We encourage our employees to use alternatives to car
travel, by promoting the use of public transport in particular
when travelling between our two office locations and by
encouraging participation in our Cycle to Work scheme.
As an online business, our culture emphasises a paperless
environment. We also recognise that our responsibilities do
not stop just with how we operate internally – we encourage
all our customers, business partners and suppliers not to
unnecessarily print out emails sent by us in the signature of
all our emails. We also continue to focus on streamlining
processes and replacing paper-based services with online
services and communications, wherever possible. Steps
introduced in recent years include e-communications to
shareholders, online customer membership forms and
product documentation and email invoicing.
Health and safety
The Group considers the effective management of health and
safety to be an integral part of managing its business. During
2012, we continued our fire safety, first aid and work place
safety training. The Group’s ongoing policy on health and
safety is to provide adequate control of the health and safety
risks arising from work activities, through further consultation
with, and training of, employees, the provision and
maintenance of plant and equipment, safe handling and
use of all substances and the prevention of accidents and
causes of ill health.
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Directors’ report
The directors submit their report together with the audited
financial statements for Rightmove plc (the Company) and
its subsidiary companies (the Group) for the year ended
31 December 2012. The Company is domiciled in England
(registered number 6426485).
Principal activities
The Group operates in the UK residential and commercial
property industry connecting people to properties.
Its principal business is the operation of the
rightmove.co.uk website, which is the UK’s largest
residential property website. Its customers (estate agents,
lettings agents, new homes developers and overseas
homes agents and vendors) pay fees for the right to display
properties on the Rightmove website, which provides home
hunters with property details to search.
Further information on the Group’s activities within each
segment during the year under review and of its prospects
can be found in the Business and financial review on
pages 6 to 15.
The following sections inclusive are incorporated by
reference into the Directors’ report which have been drawn
up and presented in accordance with and in reliance upon
acceptable English company law and the liabilities of the
directors in connection with the report shall be subject to
the limitations and restrictions provided by such law:
• Business and financial review (pages 6 to 15)
• Directors and officers (pages 16 to 17)
• Corporate social responsibility (pages 18 to 19)
• Corporate governance (pages 23 to 29)
• Remuneration report (pages 30 to 44)
In compliance with the business review provisions of the
Companies Act 2006, within the Business and financial
review, principal risk factors are discussed under the section
‘Uncertainties, threats and risks’ on page 9. Key performance
indicators are given on page 3 and information on the likely
developments of the Group under ‘Current trading and
outlook’ on page 15.
Trading results
The Group’s underlying operating profit from continuing
operations (before share-based payments and NI on
share-based incentives) for the financial year was £87,533,000
(2011: £69,362,000). Further information on the results for
the Group is set out in the Consolidated statement of
comprehensive income on page 46 and the supporting Notes
and also the Business and financial review on pages 6 to 15.
Dividend
An interim dividend of 9.0p (2011: 7.0p) per ordinary
share was paid on 9 November 2012 to shareholders on
the register of members at the close of business on
12 October 2012. The directors are recommending a final
dividend for the year of 14.0p (2011: 11.0p) per ordinary
share, which together with the interim dividend of 9.0p, paid
in respect of the half year period ended 30 June 2012, makes
a total for the year of 23.0p (2011: 18.0p), amounting to
£23,147,000 (2011: £18,551,000). Subject to shareholders’
approval at the Annual General Meeting on 8 May 2013, the
final dividend will be paid on 7 June 2013 to shareholders
on the register of members at the close of business on
10 May 2013.
Share capital
The ordinary shares in issue (including 2,505,430 shares
held in treasury) at the year end comprised 105,896,115
(2011: 110,410,636) ordinary shares of £0.01 each, being
£1,059,000 (2011: £1,104,000). The holders of ordinary
shares are entitled to receive dividends as declared from time
to time, and are entitled to one vote per share at general
meetings of the Company. Movements in the Company’s
share capital and reserves in the year are shown in Note 23
and Note 24 to the financial statements. Information on the
Group’s share-based incentive schemes is set out in Note 25
to the financial statements. Details of the share-based
incentive schemes for directors are set out in the
Remuneration report on pages 30 to 44.
Share buyback
The Company’s share buyback programme continued
during 2012. Of the 15% authority given by shareholders
at the 2012 Annual General Meeting, a total of 4,514,521
(2011: 4,350,798) ordinary shares of £0.01 each were
purchased in the year to 31 December 2012, being 4.2%
(2011: 3.9%) of the shares in issue (excluding shares held in
treasury) at the time the authority was granted. The average
price paid per share was £14.70 (2011: £11.10) with a total
consideration paid (inclusive of all costs) of £66,826,000
(2011: £48,626,000). Since the introduction of the new parent
company in January 2008, a total of 26,009,293 shares have
been purchased of which 2,505,430 have been transferred
into treasury with the remainder having been cancelled.
A resolution seeking to renew this authority will be put to
shareholders at the Annual General Meeting on 8 May 2013.
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Shares held in trust
As at 31 December 2012, 3,404,029 (2011: 4,527,783)
ordinary shares of £0.01 each in the Company were held by
The Rightmove Employees’ Share Trust (EBT) for the benefit
of Group employees. These shares had a nominal value at
31 December 2012 of £34,000 (2011: £45,000) and a market
value of £48,882,000 (2011: £56,326,000). The shares held
by the EBT may be used to satisfy share-based incentives for
the Group’s employee share plans. During the year 1,123,754
(2011: 1,794,546) shares were transferred to Group
employees following the exercise of share-based incentives.
The terms of the EBT provide that dividends payable on
the shares held by the EBT are waived.
Substantial shareholdings
As at the date of this report, the following beneficial interests
in 3% or more of the Company’s issued ordinary share
capital (excluding shares held in treasury) on behalf of the
organisations shown in the table below, had been notified to
the Company pursuant to Rule 5 of the Disclosure and
Transparency Rules:
Shareholder
Baillie Gifford & Co
No. of shares
8,615,294
Marathon Asset Management LLP
7,835,467
Caledonia Investments Pty Ltd
Standard Life Investments
Axa Investment Managers SA
BlackRock Inc
Kames Capital
Cantillon Capital Management
Old Mutual Asset Management
6,431,468
6,339,692
5,510,468
5,421,782
5,244,642
4,408,924
3,805,926
The Rightmove Employees’ Share Trust 3,393,623
%(1)
8.3
7.6
6.2
6.1
5.3
5.3
5.1
4.3
3.7
3.3
(1) The above percentages are based upon the voting rights share capital (being
the shares in issue less shares held in treasury) of 103,258,685.
Directors
The directors of the Company at the year end and as at the
date of this report are named on pages 16 to 17 together with
their profiles.
The Articles of Association of the Company require
directors to submit themselves for re-appointment where they
have been a director at each of the preceding two Annual
General Meetings and were not appointed or re-appointed
by the Company at, or since, either such meeting. Following
the changes to the UK Corporate Governance Code in
September 2010, all directors who have served during the
year and remain a director as at 31 December 2012 (other
than Ed Williams) will retire and offer themselves for
re-election at the forthcoming Annual General Meeting.
Robyn Perriss will offer herself for election, this being her
first Annual General Meeting following her proposed
appointment as an executive director on 30 April 2013.
The Board is satisfied that the directors retiring are
qualified for re-appointment by virtue of their skills, experience
and contribution to the Board. Nick McKittrick and Peter
Brooks-Johnson have service agreements with the Company
which can be terminated on 12 months notice. The
appointments for the non-executive directors, Scott Forbes,
Jonathan Agnew, Colin Kemp, Ashley Martin and Judy
Vezmar can be terminated on three months notice.
The interests of the directors in the share capital of the
Company at 31 December 2012, the directors’ total
remuneration for the year and details of their service contracts
and Letters of Appointment are set out in the Remuneration
report on pages 30 to 44. At 31 December 2012 all of the
executive directors were deemed to have a non-beneficial
interest in 3,404,029 ordinary shares of £0.01 each held by
the trustees of the EBT.
Supplier payment policy
The Group and Company’s policy concerning creditors is to
agree payment terms with its suppliers, ensure the relevant
terms of payment are included in contracts and to abide by
those terms when it is satisfied that goods or services have
been provided in accordance with the contracts. For the
year to 31 December 2012, trade creditors represented
29 days (2011: 11 days) of average daily purchases.
The Group had £1,220,000 of trade payables at the year
end (2011: £370,000).
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Directors’ report continued
Contractual arrangements
Due to the nature of the Group’s business activities, the
Group maintains a small number of contractual arrangements
with external providers of data, software, hardware, telephony
and web-based services, which are essential to support the
operation of all business segments. However, the loss of one
of these arrangements due to supplier failure would not result
in a critical business failure; as such services could be
sourced from a number of other suppliers.
Auditor
Following the 2012 revision of the UK Corporate Governance
Code by the Financial Reporting Council, the Group will be
adopting best practice and is currently tendering its audit.
In accordance with section 489 of the Companies Act
2006, separate resolutions for the appointment of auditors
of the Group and for the Audit Committee to determine their
remuneration will be proposed at the forthcoming Annual
General Meeting.
Research and development
The Group undertakes research and development activity in
order to develop new products and to continually improve the
existing property website. Further details are disclosed in
Note 2 to the financial statements on page 55.
Charitable and political donations
The Group made charitable contributions of £8,000
(2011: £3,000). Neither the Group nor the Company made
any political donations during the year (2011: £nil).
Annual General Meeting
The Annual General Meeting of the Company will be held at
the offices of UBS Limited at 1 Finsbury Avenue, London,
EC2M 2PP on 8 May 2013 at 10am. The Notice of Annual
General Meeting will be published in March 2013.
Audit information
So far as the directors in office at the date of signing of the
report are aware, there is no relevant audit information of
which the auditor is unaware and each such director has
taken all reasonable steps to make themselves aware of any
relevant audit information and to establish that the auditor is
aware of that information.
Responsibility statement of the directors in respect of
the annual financial report
We confirm that to the best of our knowledge:
• the financial statements, prepared in accordance with the
applicable set of accounting standards, give a true and fair
view of the assets, liabilities, financial position and profit or
loss of the Company and the undertakings included in the
consolidation taken as a whole; and
The resolutions being proposed at the 2013 Annual
• the Directors’ report includes a fair review of the
General Meeting are general in nature including the renewal for
a further year of the limited authority of the directors to allot the
unissued share capital of the Company and to issue shares for
cash other than to existing shareholders. A resolution will also
be proposed to renew the directors’ authority to purchase a
proportion of the Company’s own shares.
One of the items of special business to be addressed at
this Annual General Meeting relates to the requirement in the
Companies (Shareholders’ Rights) Regulations 2009, which
came into force on 3 August 2009, that all general meetings
must be held on not less than 21 clear days’ notice unless
shareholders approve a shorter notice period. At the 2012
Annual General Meeting, a resolution was passed allowing
the Company to call general meetings (other than Annual
General Meetings) on not less than 14 clear days’ notice.
As this authority will expire at the 2013 Annual General
Meeting, a resolution will be proposed to renew this authority.
development and performance of the business and the
position of the issuer and the undertakings included in the
consolidation taken as a whole, together with a description
of the principal risks and uncertainties that they face.
Signed by the Board:
Ed Williams
Nick McKittrick
Chief Executive Officer
Chief Operating Officer and
Finance Director
1 March 2013
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Corporate governance
Statement of compliance
The UK Corporate Governance Code (the Code) sets out the
principles and provisions relating to good governance of UK
listed companies. In this section we set out how we have
applied the principles and complied with the provisions of
the 2010 Code during 2012. As a UK listed company, the
Company is required to state whether it has complied with
the provisions of the Code and where the provisions have
not been complied with, to provide an explanation.
The directors believe that the Company is compliant in
all areas with one exception, which is explained below.
The Board, the Board balance and independence
At the date of this report, the Board comprises eight
directors including the Chairman (Scott Forbes), three
executive directors (Ed Williams, Chief Executive Officer,
Nick McKittrick, Chief Operating Officer and Finance Director
and Peter Brooks-Johnson, Managing Director, rightmove.
co.uk) and four non-executive directors (Jonathan Agnew,
who is the Senior Independent Director, Colin Kemp,
Ashley Martin and Judy Vezmar).
As announced in November 2012, Ed Williams’ date
of retirement is 30 April 2013. As part of the announced
organisational changes Nick McKittrick will become Chief
Executive Officer, Peter Brooks-Johnson will become Chief
Operating Officer and it is proposed that Robyn Perriss will
join the Board as Finance Director. Assuming an unchanged
number of Board directors, Rightmove would then have 25%
of Board members being female, two years ahead of the
target of 25% female Board members by 2015 set out in
our 2011 Annual Report.
For each appointment the Board undertook a formal
appointment process led by the Nomination Committee.
Having made substantial progress with gender diversity at
Board level, the Board will focus further on the next level of
senior management in order to develop potential within this
team to step up to Board level at the appropriate time and to
identify and develop potential within the wider organisation
with a view to strengthening the female representation within
the senior management team. In 2012, 13% of our senior
management team were female.
The directors believe that the Board currently operates
effectively and that there is an appropriate balance between
the executive and non-executive directors and that all the
non-executive directors are fully independent of management
and independent in character and judgement. Consideration
of the Board balance is kept under regular review by the
Chairman and Chief Executive Officer.
Colin Kemp (non-executive director) is an employee of
Lloyds Banking Group. Lloyds Banking Group is a customer
of Rightmove Group Limited. Until October 2009, Lloyds
Banking Group owned Halifax Estate Agencies Ltd. Halifax
Estate Agencies Ltd was a shareholder in Rightmove plc until
May 2008. Therefore, in strict application of the Code, Colin
Kemp is only considered to have been independent from
October 2012. Nonetheless, the Board considers that Colin
Kemp is independent in character and in particular continues
to challenge rigorously the executive directors and the Board
as a whole. As a result, the composition of the Board
throughout the year under review was not in strict compliance
with supporting principle B.1.2 of the Code in that at least half
of the directors (excluding the Chairman) were not considered
independent non-executive directors; although it is compliant
as at 31 December 2012.
Ed Williams, Chief Executive Officer, is also a non-
executive director of Trader Media Group. His remuneration in
relation to this role is set out in the Remuneration report on
page 30 all of which has been donated directly to charities.
Neither the Chairman nor the other two executive directors
hold any other non-executive directorships or commitments
disclosable under the Code.
Biographical details of the directors at the date of this
report and details of their committee membership appear
on pages 16 and 17.
Directors’ remuneration
The principles and details of directors’ remuneration and
contractual arrangements are contained in the Remuneration
report on pages 30 to 44.
Re-election to the Board
Directors are appointed and may be removed in accordance
with the Articles of Association of the Company and the
provisions of the Companies Act 2006.
All directors are subject to election at the first Annual
General Meeting following their appointment and to
re-election at intervals of no more than three years in
accordance with the Code and the Company’s Articles
of Association. However all directors, with the exception of
Ed Williams, will seek re-election at the 2013 Annual General
Meeting, in accordance with the Code provision B.7.1.
As disclosed in our stock exchange announcement in
November 2012, Ed Williams has decided to retire from the
Board with effect from 30 April 2013.
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Corporate governance continued
Board and Committee membership and attendance
The membership of the Committees of the Board and
attendance at Board and Committee meetings for the
year under review are set out in the table below:
Remuneration
Audit Nomination
Board
Committee
Committee Committee
Total meetings
Scott Forbes
Jonathan Agnew
Peter Brooks-Johnson
Colin Kemp
Ashley Martin
Nick McKittrick
Judy Vezmar
Ed Williams
8
8
8
8
8
8
8
8
8
5
(1)
5
N/A
N/A
5
N/A
5
N/A
4
N/A
4
N/A
(2)
4
N/A
3
N/A
2
2
2
N/A
N/A
N/A
N/A
2
N/A
(1) The Remuneration Committee Chairman has requested that the Chairman of
the Board attend the Remuneration Committee meetings.
(2) Colin Kemp is invited to attend Audit Committee meetings on a guest basis.
Any director’s absence from Board meetings or meetings
of the Remuneration, Audit or Nomination Committees was
previously agreed with the Chairman, the Chief Executive
Officer or the Chairman of the relevant committee.
In addition to the above meetings, the Chairman conducts
meetings with the non-executive directors without the
executive directors being present when required. Jonathan
Agnew, the Senior Independent Director, chaired a meeting
of the Board at which the performance of the Chairman was
also reviewed (without the presence of the Chairman).
Operation of the Board
The Board is responsible to shareholders for the overall
direction and control of the Group. Its key task is to approve
strategy, ensuring the successful implementation of projects
and proposals and monitoring the operating performance of
the Group in pursuit of its objectives in the interest of
maximising long-term shareholder value. The Board has
adopted a formal schedule of matters requiring specific
approval. These include, amongst other things, the approval
of the annual business plan, capital structure, dividend policy,
acquisitions and disposals, appointment and removal of
officers of the Company, approval of the Half Year and Full
Year results, shareholder communication and responsibility
for corporate governance and review of the Group’s risks and
system of internal controls.
The Board receives meeting papers to allow sufficient time
for detailed review and consideration of the documents
beforehand. If any director has a concern about any aspect of
the business conducted at any Board meeting, the Company
Secretary shall discuss this with the director concerned and
record their concern or comments in the Board minutes. The
Board receives monthly management and financial reports on
the operational and financial performance of the business
setting out actual and forecast financial performance against
approved budgets in addition to other key performance
indicators. The Board also receives copies of broker reports
and press releases relating to the Group. At least once a year
the Chief Executive Officer and the senior management team
present a strategic review and an annual plan to the Board for
review and approval.
The Board normally schedules eight meetings each year
although meetings can be scheduled at short notice at the
request of any director, or if required. In addition to formal
Board meetings, there is regular informal dialogue between
all directors.
Chairman and Chief Executive Officer
The posts of Chairman and Chief Executive Officer are
separate and there are clear written guidelines to support
their division of responsibilities. The Chairman, Scott Forbes,
is responsible for the effective conduct and leadership of the
Board and for communication with shareholders. With the
assistance of the Company Secretary, the Chairman monitors
the information provided to the Board to ensure that it is
sufficient, pertinent, timely and clear.
The Chief Executive Officer has day-to-day executive
responsibility for the running of the Group, leading the
executive and operational teams in developing strategies and
delivering results against defined targets to enable the Group
to meet its objectives.
Board training
The breadth of management, financial and listed company
experience of the non-executive directors is described in the
biographical details on pages 16 and 17 and demonstrates a
range of business expertise that provides the right mix of skills
and experience given the size of the Company. There are
procedures in place for individual Board members to receive
induction and training tailored to their individual needs and to
seek the advice and services of independent professional
advisers, at the Company’s expense, where specific expertise
or training is required in furtherance of their duties.
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The Articles of Association of the Company allow for a
qualifying third party indemnity provision between the
Company and its directors and officers, which remains in
force at the date of this report. The Group has also arranged
directors’ and officers’ insurance cover in respect of legal
action against the directors.
The Group has set out written policies in compliance with
a code of securities dealings in relation to the shares and
equivalent to the Model Code published in the Listing Rules.
The code applies to all directors, other persons discharging
managerial responsibility and other relevant employees.
Company Secretary
All Board directors have access to independent advice on
any matters relating to their responsibilities as directors and
as members of the various committees of the Board at the
Company’s expense.
Robyn Perriss, Financial Controller and Finance Director
designate, was appointed as Company Secretary in
April 2012 and is available to all directors and is responsible
for ensuring that all Board procedures are complied with.
The duties of the Company Secretary continue to grow
with the increase in size of the Group’s activities and
legislative changes. To assist in this area the Assistant
Company Secretary coordinates and manages the provision
of company secretarial services and share plans to the Group
on behalf of Robyn Perriss. Other suitably qualified individuals
currently act as secretary to the Audit, Nomination and
Remuneration Committees to ensure that no conflicts of
interest arise.
Board evaluation
The Board is committed to undertaking annual reviews of its
own performance and also the performance of its committees
and individual directors. For the past two years, the Board
has undertaken a self-assessment. This year, Korn/Ferry
International, an external firm of consultants, was appointed
to undertake an independent review of the performance of
the Board and its committees. The evaluation was undertaken
by a series of confidential interviews with the directors and
Company Secretary covering the areas of Board composition,
governance, engagement and dynamic. The results of Phase
One, being the operations of the Board today, were presented
to the Board in December 2012.
Korn/Ferry International’s report concluded that the Board
and its committees continue to operate effectively. It identified
a small number of further actions to help support our
commitment to continuous improvement with the main area
of focus being to create additional opportunities for informal
discussion of key aspects of the business between Board
members.
Phase Two is to review in more detail the composition of
the Board and the alignment of skills, expertise and experience
with Rightmove’s medium term strategic agenda and will be
completed in early 2013.
At a meeting chaired by Jonathan Agnew, Senior
Independent Director, (without the presence of the Chairman),
the Board provided input into and reviewed the performance
of the Chairman.
Relations with shareholders
The Board is accountable to shareholders for the
performance and activities of the Company and welcomes
the opportunities to engage with shareholders.
Within the terms of the regulatory framework, the
Company has conducted regular dialogue with institutional
shareholders through ongoing meetings with institutional
investors and research firms to discuss strategy, operating
performance and financial performance. Contact in the UK
is principally with the Chief Executive Officer and the Chief
Operating Officer and Finance Director. The Chairman also
participates in the USA bi-annual investor roadshows.
Jonathan Agnew, Senior Independent Director, is also
available to shareholders if they wish to supplement their
communication or if contact through the normal channels
is inappropriate.
The Board is kept informed of the views and opinions of
those with an interest in the Company through reports from
the Chief Executive Officer and Chief Operating Officer and
Finance Director, as well as reports from the Company’s joint
brokers, UBS and Numis.
Shareholders are also kept up to date with the
Group’s activities through the Annual and Half Year
Reports and the investor relations section of its website, at
www.rightmove.co.uk/investors, which provides details of all
the directors, latest news, including financial results, investor
presentations and Stock Exchange announcements.
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Corporate governance continued
Conflicts of interest
In cases of doubt, the Chairman of the Board is responsible
for determining whether a conflict of interest exists.
Annual General Meeting
The Annual General Meeting is an opportunity for
shareholders to vote on certain aspects of the Company’s
business, and to ask questions of the directors, who will
also be available for discussions with shareholders prior to
and after the meeting. The Annual General Meeting will
be held on 8 May 2013 at the offices of UBS Limited at
1 Finsbury Avenue, London, EC2M 2PP.
The Company will arrange for the Annual Report and
related papers to be available on the Company’s corporate
website at www.rightmove.co.uk/investors or posted to
shareholders (where requested) so as to allow at least
20 working days for consideration before the Annual
General Meeting.
The Company also complies with the Code with the
separation of all resolutions put to the vote of shareholders.
The Company proactively encourages shareholders to vote
at general meetings by providing electronic voting for
shareholders who hold their shares through the Crest system
and provides personalised proxy cards to ensure that all
votes are clearly identifiable. The Company presently takes
votes at general meetings on a show of hands on the grounds
of practicality due to the limited number of shareholders in
attendance. Votes are taken by a poll at any shareholder
meeting where legally required. All proxy votes are counted
and the level of proxy votes including abstentions lodged for
each resolution are reported after each resolution and
published on the Company’s website.
Board committees
The Board has established three principal committees, the
Audit Committee, the Remuneration Committee and the
Nomination Committee, each of which operates within written
terms of reference approved by the Board. No person other
than a Committee member is entitled to attend the meetings
of these Committees, except by invitation of the Chairman of
that Committee.
Remuneration committee
The Remuneration Committee’s principal responsibility is
for setting, reviewing and recommending to the Board the
remuneration policy and strategy to ensure that the
Company’s executive directors and senior executives are
properly incentivised and fairly rewarded for their individual
contributions to the Company’s overall performance, having
due regard to the interests of the shareholders and to the
financial and commercial health of the Group. Full details of
the Remuneration Committee’s responsibilities, and a report
of its activities during the year, are set out in the Remuneration
report on pages 30 to 44.
Nomination committee
The purpose of the Nomination Committee is to consider and
make recommendations to the Board about the composition
of the Board, including proposed appointees, and whether to
fill any vacancies that arise or to change the number of Board
members.
The Nomination Committee consists of Scott Forbes
(who is also Chairman of the Board), Jonathan Agnew and
Judy Vezmar as independent non-executive directors. The
quorum for meetings of the Nomination Committee is two
members. The Chairman of the Company may not chair the
Nomination Committee in connection with any discussion
about the appointment of his successor to the chairmanship
of the Company. In these circumstances, the Senior
Independent Director will take the chair. Appointments are for
a period of up to three years, extendable by no more than two
additional three-year periods, so long as members continue to
be independent.
The Nomination Committee meets at such times as may
be necessary and normally meets at least twice a year.
The Nomination Committee’s terms of reference
are available on the Company’s website,
www.rightmove.co.uk/investors or by request from
the Company Secretary.
During the year the Nomination Committee has:
• approved the organisation structure;
• approved the plans for the succession of the executive
directors and the senior management team;
• agreed the process for the Board’s annual evaluation;
• considered the diversity of the Board and agreed the policy
regarding gender composition on the Board; and
• conducted an annual review of its terms of reference.
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The Nomination Committee is planning for Board succession,
in response to the fact that the Chairman and three of the
non-executive directors are currently in their third term of
service to the Board. A plan will be implemented to ensure
that any new appointments are tiered such that succession
does not cause disruption to the business. The refreshment
process will be flexible and fluid in order to maintain stability
and continuity.
Audit committee
The Audit Committee assists the Board in the discharge of its
duties concerning the announcement of results, the Annual
and Half Year Reports and the maintenance of an effective
system of internal controls. It reviews the scope and planning
of the audit and the auditor’s findings and considers the
Group’s accounting policies and the compliance with those
policies and applicable legal and accounting standards.
The Audit Committee has authority to investigate any areas
of concern as to financial impropriety that arise and to obtain
outside legal or other independent professional advice in
connection therewith. The Audit Committee’s principal duties
and terms of reference are available on the Company’s
website, www.rightmove.co.uk/investors, or by request
from the Company Secretary.
The Audit Committee consists of the three independent
non-executive directors, Ashley Martin (who is Chairman),
Judy Vezmar and Jonathan Agnew. Ashley Martin, who is
currently Group Chief Financial Officer of The Engine Group
and was previously the Finance Director of Rok plc and
Tempus Group plc and, having relevant financial skills and
experience, was appointed to the role of Audit Committee
Chairman on his appointment to the Board in June 2009.
The quorum for meetings of the Audit Committee is two
members. Appointments to the committee are for a period of
up to three years, extendable by no more than two additional
three-year periods, so long as members continue to be
independent.
The Audit Committee meets at least four times a year and
more often if necessary. Two of its meetings are prior to the
announcement of the Half Year and Full Year results of the
Group, when the external auditor is in attendance. The Chief
Operating Officer and Finance Director and Financial Controller
are normally invited to attend the meetings. Colin Kemp,
non-executive director, is also invited to attend the meetings.
During the year the Audit Committee has, amongst
other matters:
• approved the appointment of the external auditor;
• fixed their remuneration and reviewed the effectiveness of
the external audit process;
• considered the need for an internal audit function;
• considered its responsibilities to safeguard the audit
objectivity and independence as well as the needs of the
business and reviewed a policy for non-audit project work;
• received the report from the external auditor on their review
of the 2011 Full Year and reviewed the 2011 Annual Report;
• agreed the remit of the 2012 audit plan by the external
auditor;
• received the report from the external auditor on their
review of the 2012 Half Year results and reviewed the
2012 Half Year Report;
• reviewed the Group’s treasury policy;
• received the report from the external auditor on their
review of the internal systems and controls;
• reviewed the whistleblowing policy (which provides the
procedure for staff to report any concerns that they may
have independent of management about suspected
misconduct without fear of retaliation);
• reviewed the bribery policy and procedures for compliance
with the Bribery Act;
• conducted an annual review of its terms of reference;
• approved a timetable for tendering the Group audit
during 2013;
• received a presentation on the implementation of a new
finance system; and
• reviewed the outcomes of an external report covering
website technology, infrastructure and people.
Given the simplicity of the organisational structure, the open
and accountable culture with clear authority limits, the
straightforward financial model and systems and the fact that
the management team and Board conduct regular financial
reviews, the Audit Committee recommended to the Board
that an internal audit function was not currently appropriate
for the business. This decision is kept under regular review.
The Audit Committee also discussed its responsibilities to
safeguard the audit objectivity and independence as well as
the needs of the business and agreed that it was practical in
many cases for the auditor to be assigned to other non-audit
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Corporate governance continued
project work due to their knowledge and expertise of the
business. This would usually relate to corporate transaction
advice and tax compliance. The Audit Committee agreed a
policy that management be given authority to incur non-audit
fees up to 50% of the annual agreed audit and tax fee in
any financial year without the prior approval of the Audit
Committee. In 2012 the non-audit fees were £17,000 in
relation to other advisory services and were £11,000 in
relation to tax compliance and advice and are fully disclosed
in Note 6 of the financial statements.
Internal controls
The Board has overall responsibility for the Group’s system of
internal controls and has established a framework of financial
and other controls, which is periodically reviewed in
accordance with the Turnbull guidance for its effectiveness.
• clearly defined policies for capital expenditure and
investment exist, including appropriate authorisation levels,
with larger capital projects, acquisitions and disposals
requiring Board approval;
• a comprehensive disaster recovery plan based upon
co-hosting of the rightmove.co.uk website across three
separate London locations, which is regularly tested
and reviewed;
• a treasury function which manages cash flow forecasts
and cash on deposit and is responsible for monitoring
compliance with banking agreements, where appropriate;
• a whistleblowing policy of which all employees are made
aware, to enable concerns to be raised either with line
management or, if appropriate, confidentially outside the
line management structure; and
• a bribery policy of which all employees are made aware,
The Board has taken, and will continue to take,
to ensure compliance with the Bribery Act.
appropriate measures to ensure that the chances of financial
irregularities occurring are reduced as far as reasonably
possible by continually seeking to improve the quality of
information at all levels in the Group, fostering an open
environment and ensuring that financial analysis is rigorously
applied. 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.
The Group’s management has established the procedures
necessary to ensure that there is an ongoing process for
identifying, evaluating and managing the significant risks to
the Group. These procedures have been reviewed regularly
and have been in place for the whole of the financial year
ended 31 December 2012 and up to the date of the approval
of the financial statements.
The key elements of the system of internal control are:
• major commercial, strategic, competitive and financial risks
are formally identified, quantified and assessed, discussed
with the executive directors, after which they are considered
by the Board;
• a comprehensive system of planning, budgeting and
monitoring Group results. This includes monthly
management reporting and monitoring of performance
against both budgets and forecasts with explanations for
all significant variances;
• an organisational structure with clearly defined lines of
responsibility and delegation of authority;
Through the procedures outlined above, the Board, with
advice from the Audit Committee, has considered all
significant aspects of internal control for the year and up
to the date of this Annual Report. No significant failings or
weaknesses were identified during this review. However,
had there been any such failings or weaknesses, the Board
confirms that necessary actions would have been taken to
remedy them.
Going concern
The Board is required under the Code to consider
whether or not it is appropriate to adopt the going concern
basis in preparing the Group and the parent Company
financial statements.
As part of its normal business practice the Group
prepares annual and longer term financial plans. In addition,
a going concern paper was prepared and presented to the
Audit Committee in February 2013, prior to it recommending
the approval of the financial statements and notes to
the accounts for the year ended 31 December 2012 to
the Board.
After making enquiries, the Board has a reasonable
expectation that the Group and the Company have adequate
resources and banking facilities to continue in operational
existence for the foreseeable future. Accordingly, the Board
continues to adopt the going concern basis in preparing the
Annual Report and financial statements. Further information is
provided in Note 1 to the financial statements.
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Statement of directors’ responsibilities in respect of the
Annual Report and financial statements
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 on the same basis.
Under company law the directors must not approve the
financial statements unless they are satisfied that they give
a true and fair view of the state of affairs of the Group and
parent Company and of their profit or loss for that period.
In preparing each of the Group and parent Company financial
statements, the directors are required to:
• select suitable accounting policies and then apply them
consistently;
• make judgements and estimates that are reasonable and
prudent;
• state whether they have been prepared in accordance with
IFRSs as adopted by the EU; and
• 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.
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 Directors’ Report, Directors’
Remuneration Report and Corporate Governance Statement
that comply 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.
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Remuneration report
Jonathan Agnew
Non-executive Director
In line with the requirements of section 420 of the Companies
Act 2006, the directors present the report on directors’
remuneration for Rightmove plc (the Company) and its
subsidiary companies (the Group) for the year ended
31 December 2012. This report sets out the policies under
which executive and non-executive directors were
remunerated and provides tables of information showing
details of the remuneration and share interests of all the
directors. In accordance with the requirements, the report
provides the disclosure in two parts: information subject to
audit and information that is not subject to audit.
Shareholders will be provided with an opportunity to vote
on the Remuneration Report as set out in this Annual Report
at the forthcoming Annual General Meeting to be held on
8 May 2013.
Part I: Unaudited information
This part of the Remuneration Report is not subject to audit.
The Remuneration Committee
Terms of reference
The primary role of the Remuneration Committee (hereinafter
referred to as the Committee throughout this report) is to
make recommendations to the Board as to the Company’s
broad policy and framework for the remuneration of the
executive directors, the Chairman of the Board and the
Company Secretary. In accordance with the 2010 UK
Corporate Governance Code (the Code), the Committee also
recommends the structure and monitors the level of
remuneration for the first layer of management below Board
level. The Committee is also aware of, and advises on, the
employee benefit structures throughout the Company and
ensures that it is kept aware of any potential business risks
arising from those remuneration arrangements.
The Committee has formal terms of reference which are
reviewed annually and updated as required. These are available
on the Company’s website at www.rightmove.co.uk/investors
or on request from the Company Secretary.
Membership
The following independent non-executive directors were
members of the Committee during 2012 and continue to
be members.
During 2012 the Committee met five times and the
attendance is shown below:
Name of director
Number of meetings attended
Jonathan Agnew (Chairman of the Committee)
Ashley Martin
Judy Vezmar
5 out of 5
5 out of 5
5 out of 5
Only members of the Committee have the right to attend
Committee meetings. The Chairman of the Committee
has requested that the Chairman of the Board attend the
meetings except during discussions relating to his own
remuneration. Prior to April 2012, the Company Secretary
acted as secretary of the Committee, the Human Resources
Director has subsequently assumed this responsibility.
The Chief Executive Officer and Chief Executive Officer
Designate, may also be invited to meetings and the
Committee takes into consideration their recommendations
regarding the remuneration of executive colleagues and the
first layer of management below Board level. No director is
involved in deciding their own remuneration.
The quorum for meetings of the Committee is two
members. The Committee will meet at such times as may
be necessary but will normally meet at least three times a year.
Advice
As previously reported, in the latter part of 2010 and early
2011, New Bridge Street (NBS), an Aon Hewitt company,
was engaged by the Committee to review the Company’s
policy on executive director remuneration.
The Committee and the Board considered that the
Company had reached a point at which it was necessary that
the remuneration practice should be brought closer into line
with more standard practice among FTSE companies. The
Committee commissioned an independent review by NBS
to assist in its determination of an appropriate future
remuneration framework for executive directors to apply from
2011. The Committee has retained NBS as its appointed
adviser since 2011 and NBS provided assistance, as
required, during the year under review.
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During 2012 NBS also provided services to the Company in
connection with the valuation of share-based incentives (as
required by IFRS 2) and confirmed that, in its view, this service
did not present a conflict of interest with the other services
provided to the Committee.
2012
In line with its remit, the following matters were considered
by the Committee during the year:
• approval of the 2011 Remuneration report and review of the
voting on the report at the Annual General Meeting (AGM);
• approval of deferred share awards for the 2011 financial
to reflect the performance driven culture of the Company.
The Company will generally review market levels of
remuneration for executive directors with the assistance
of external, independent remuneration consultants and
shareholder consultation every three years.
• Having reviewed executive director remuneration against
the market, every three years, further changes to
remuneration should be made infrequently and those
changes made each year should, in most instances, be
directly linked to the policies applied to all employees
(specifically with regard to cost of living rises in base salary
and changes in benefits).
year under the Deferred Share Bonus Plan (DSP);
• Executive directors should be principally rewarded for the
• setting of all performance measures for the 2012 bonus
plan;
• approval of awards under the Rightmove Performance
Share Plan (PSP);
overall success of the business for which they have
collective responsibility. The Company has key short-term,
medium-term and long-term goals and executive directors
should be incentivised against these goals.
• annual review of executive directors’ and senior managers’
• Executives should not be able to gain significantly from
base salaries;
• agreeing the targets for the 2013 bonus plan;
• agreeing the targets for the proposed PSP awards to be
made in March 2013;
• treatment of Ed Williams’ share-based incentives upon his
retirement on 30 April 2013;
• review of the Committee’s performance during the period;
and
• review of the Committee’s terms of reference.
Remuneration policy
Rightmove’s remuneration policy is based on the belief that
growth-orientated companies should reward executives with
demonstrably lower than market base salaries and benefits
and higher than market equity rewards contingent upon the
achievement of challenging performance criteria.
The key principles of the Committee’s policy are as follows:
• Remuneration arrangements should be simple to
understand and administer.
• Remuneration arrangements should be designed to provide
executive directors with the opportunity to receive a share in
the future growth and development of the Company which
is regarded as fair by both other employees and
shareholders. This approach should allow the Company to
attract and retain the dynamic, self-motivated individuals
who are critical to the success of the business.
• Executive directors should have below market levels of base
salary, minimal benefits (and only benefits which are made
available on the same basis to all Rightmove employees),
and above market levels of variable pay potential. This
arrangement is designed to best align the interests of the
executive directors with the interests of shareholders and
short-term successes which subsequently prove not to be
consistent with growing the overall value of the business.
Hence a majority of any bonus payable in relation to short-
term strategic goals is required to be taken in the form of
shares in the Company which are deferred for a further two
years after the bonus target has been achieved.
The Committee is mindful of the current wider concerns
regarding executive remuneration and supportive of
government proposals to bring more rigour and transparency
to this area. The Committee’s approach already
demonstrates a commitment to modest guaranteed rewards
compared to market norms. Base salaries are below median
compared to appropriate benchmarks and the average
remuneration of employees in the business relative to the
executive directors is at more modest multiples than those
operated in many other FTSE 250 companies. Executive
directors only receive the same additional benefits that are
available to all employees. Neither employment contracts nor
previous precedents suggest that the Company offers
rewards for failure. No employment contract has a term
greater than one year and clawback provisions are in place
with regard to bonus and the PSP plans. To the extent that
executive remuneration has been high or may continue to be
so, this has been the result of the strong operating
performance of the business and the high level of shareholder
returns generated. As stated above, overall remuneration
philosophy is for significantly lower than benchmark fixed
remuneration and higher proportionate rewards for success.
This appears to be in line with the government’s policies.
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Remuneration report continued
2012 Remuneration
In early 2011 and as previously reported, the Committee
approved a number of significant changes to the Company’s
remuneration framework to ensure that it remains consistent
with the Committee’s remuneration policy. In particular, base
salaries are being adjusted to a more market competitive level
(albeit a level that is still significantly below appropriate market
median benchmarks) in order to ensure that the Company is
able to recruit and retain high quality executives. At the same
time as increasing base salaries, taking due account of the
institutional investors’ views and the current executive pay
environment, incentive opportunity is being moderated to
provide a more balanced remuneration structure that is more
reflective of typical FTSE 250 market practice albeit retaining
a clear emphasis on variable pay given the Company’s
growth orientated focus.
These changes, approved by shareholders at the 2011
AGM, are being phased in over a three-year period to 2013.
The second phase of these changes applied in 2012
(as reported in last year’s Directors’ Remuneration Report)
and, in summary, the 2012 pay arrangements comprised
the following:
• Base salaries of £318,240 for Ed Williams and Nick
McKittrick, with Peter Brooks-Johnson’s salary set at
£245,000 (these increases were each at 22.5% of salary).
• No pension provision for Nick McKittrick and Ed Williams.
Peter Brooks-Johnson was appointed to the Board in
January 2011 and was already a member of the stakeholder
pension plan with the Company paying employer
contributions of £3,000 per annum.
• An annual cash bonus of up to 55% of salary (reduced
from 65% in 2011) and a DSP bonus of up to 95% of salary
(reduced from 110% in 2011) for Ed Williams and Nick
McKittrick. Peter Brooks-Johnson’s bonus potential for
2012 was the same as for the other executive directors,
compared to a 2011 cash bonus of up to 60% of salary
and deferred share bonus of up to 100%. The bonus (both
the cash and DSP elements) was determined by a mixture
of underlying operating profit performance and key
performance indicators relating to underlying drivers of
long-term revenue growth.
• A grant under the PSP of nil cost options or contingent
shares worth up to 175% of salary to Ed Williams and to
Nick McKittrick (200% of salary in 2011) and 150% of
salary to Peter Brooks-Johnson (previously 125% of salary).
Vesting of awards is subject to a mixture of earnings per
share (EPS) growth (75% of the awards) and relative
Total Shareholder Return (TSR) (25% of the awards)
performance targets.
When comparing performance against the 2012 bonus
targets set, the Committee determined that 90% of the
maximum achievable cash and DSP bonus should be paid
to the executive directors. Accordingly, a cash bonus of
£157,529 will be paid to Ed Williams and Nick McKittrick and
£121,275 to Peter Brooks-Johnson after the announcement
of the Full Year results for the year ended 31 December 2012.
In addition an award of deferred shares in the Company worth
85.5% of salary will be granted to Ed Williams, Nick McKittrick
and Peter Brooks-Johnson under the DSP, which will be
deferred until March 2015. The bonus payment reflects the
increase in underlying operating profit in the period (maximum
70% of the bonus opportunity) and performance against the
Company’s key performance indicators (maximum 30% of the
bonus opportunity) which included retention of all of
Rightmove’s key customers and market share as measured
by page impressions. The Committee believes the resulting
bonus payment is appropriate in the context of the business
performance which delivered 23% year on year growth in
underlying operating profit.
2013 remuneration and details of the future
remuneration framework
As previously reported, during 2010, the Committee
undertook a consultation process with major shareholders
and investor bodies and, at the 2011 AGM, received
widespread support for the introduction of its revised
remuneration framework with 99.0% of the votes cast in
favour of the Remuneration report. Consequently, the
revised remuneration framework is being implemented and
phased in over three years (2011-2013). The Committee
reserves the right to revisit executive remuneration should
the circumstances dictate but its intention is to implement
these changes over three years with no further alterations
to the remuneration framework during that time.
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2013 is the third and final year of the phased changes. Full
details of pay arrangements for 2013 are outlined on pages
33 to 36. We propose to carry out a third party remuneration
review during the second half of 2013, in advance of setting
our remuneration policy for 2014 and beyond, which will be
subject to a binding shareholder vote. This review will also
consider changes in responsibilities following the retirement
of Ed Williams and the consequent impact on executive
director remuneration.
Base salary
The Committee had previously agreed that Ed Williams and
Nick McKittrick should have equal levels of base salary. It had
also agreed that the market benchmark used to assess their
pay should be consistent with this decision; hence the use of
a benchmark which is based on the FTSE 250 median for the
average pay for a chief executive office and a finance director.
This approach to setting their pay was considered
appropriate given the division of responsibilities operated by
the two roles and the culture that exists within Rightmove.
As disclosed in the 2010 Remuneration report, the
Committee had determined that the value of Ed Williams’ and
Nick McKittrick’s fixed pay (salary plus benefits) should be
adjusted so that by 2013 it is approximately 25% below the
market benchmark. The third phased increase towards this
target level applies in 2013. The previously agreed base
salaries (of £360,000 each for 2013) were subject to review
by the Committee to take account of any significant changes
in Rightmove’s size and also basic inflation (where a market
adjustment was applied at the same percentage rate as for
other employees of 4% in 2012 and 3% in 2013). Therefore
base salaries for Ed Williams and Nick McKittrick with effect
from 1 January 2013 have been set at £385,632. The
Committee is comfortable with this revised salary level on the
basis that it increases the pre-set benchmark in line with the
increases awarded over the same time period to the wider
workforce at Rightmove. Whilst the Committee was mindful in
setting the revised salary level that Rightmove has increased
substantially in size since the current remuneration policy was
set in late 2010 (almost doubling in terms of market
capitalisation), now was not considered an appropriate time
to more substantially adjust the pre-set benchmarks with this
position set to be kept under review.
The Committee had agreed that by the end of the
implementation of the remuneration framework in 2013,
Peter Brooks-Johnson’s salary should be 75% of Ed Williams’
and Nick McKittrick’s salaries and accordingly his salary has
been increased to £289,224 with effect from 1 January 2013.
The current salaries for the executive directors with effect
from 1 January 2013 are set out in the table below:
Executive directors(1)
Ed Williams(2)
Nick McKittrick
Peter Brooks-Johnson
Salary
1 January 2013
Salary
31 December 2012
£385,632
£385,632
£289,224
£318,240
£318,240
£245,000
(1) The executive directors’ wages and salaries made up 9% of the Group’s
wages and salaries cost in 2012.
(2) Ed Williams’ salary is payable pro-rata through to his retirement on
30 April 2013.
Pension and other benefits
The Group operates a stakeholder pension plan for
employees under which the employer contributes 6% of
base salary (to a maximum of £3,000 each year) subject to
the employee contributing a minimum of 3% of base salary.
Ed Williams and Nick McKittrick voluntarily do not participate
in this arrangement. Peter Brooks-Johnson is a member of
the stakeholder pension plan and the Company contributes
£3,000 per annum. The Company does not contribute to any
personal pension arrangements.
The executive directors are enrolled in the Company’s
private medical insurance scheme and receive life assurance
cover equal to four times base salary. Additionally,
Nick McKittrick is a member of the Company’s medical
cash plan.
Annual performance-related bonus
The Committee believes that the annual cash and DSP offer
a competitive potential reward. As previously reported, it is,
therefore, reducing the directors’ bonus potential as a
percentage of salary over the three years (2011-2013) to
ensure that the monetary value of the potential bonus is
maintained broadly at the value as before the implementation
of the new pay framework.
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Remuneration report continued
Consequently, concurrent with the salary increase outlined
above, annual bonus potential for all executive directors in
2013 will be reduced to 125% of salary (150% of salary in
2012). The maximum bonus in 2013 will be made up of 50%
of salary in cash and 75% of salary in deferred shares.
Deferred shares will vest after two years and be potentially
forfeitable during that period. The Committee has determined
that Ed Williams will not be entitled to receive a bonus for
2013 due to his retirement from the Company effective
30 April 2013.
The bonus will, as in previous years, be determined
principally (70%) by underlying operating profit before
tax performance with targets set in relation to a carefully
considered business plan and requiring significant
out-performance of that plan to trigger maximum payments.
A significant portion of the bonus (30%) will be determined
by reference to pre-set targets for key performance indicators
relating to underlying drivers of long-term revenue growth.
Share awards
At flotation and in subsequent years, the Company awarded
market value share options to executive directors and other
selected employees designed to align the interests of
employees with the long-term success of the business.
As outlined in the 2010 Remuneration report however, the
Committee believes that awards of performance shares are
now more consistent with general FTSE practice and provide
better alignment of executive reward to performance.
Consequently, following shareholder approval at the 2011
AGM, the PSP was established. The PSP permits annual
awards of nil cost options or contingent shares worth up to
200% of salary. Nick McKittrick and Peter Brooks-Johnson
will receive an annual award in 2013 of 150% of salary
(2012: 175% for Nick McKittrick and 150% for Peter
Brooks-Johnson). The Committee has determined that
Ed Williams will not be entitled to an award due to his
retirement from the Company effective 30 April 2013.
Shares will only vest in the event of prior satisfaction of a
performance condition. The Committee has made clear in
previous Remuneration reports that it believes EPS growth
is the most appropriate type of performance condition for this
particular business at this stage in its development (since it is
the measure of profitability that is most closely aligned with
shareholders’ interests and monitored on an ongoing basis
within the business). It also recognises that a number of
shareholders believe it important that relative TSR should also
be a performance measure in order for there to be a clear
alignment of executive and shareholder interests. Accordingly,
the use of EPS and TSR in tandem is considered to provide
a balanced approach to incentivising profitable growth at the
same time as maximising returns for shareholders.
Consistent with 2011 and 2012, PSP awards to
executive directors under the PSP in 2013 will be subject
to a mixture of EPS (75% of the awards) and relative TSR
(25% of the awards) performance but with an EPS threshold
of 22.5% growth (2012: 30% growth) at which awards are
eligible to vest.
The 2013 targets are as follows:
Relative TSR condition
The vesting schedule for the relative TSR element of executive
directors’ 2013 PSP awards is set out below. It is consistent
with the TSR condition used for previous grants under the
share-based incentive schemes. Performance will be
measured over three financial years.
TSR performance of the Company
relative to the FTSE 250 Index(1)
% of award vesting
(maximum 25%)
Less than the Index
Equal to the Index
25% higher than the Index
0%
6.25%
25%
Intermediate performance
Straight-line vesting
(1) If the FTSE 250 Index’s TSR was 50% over the three-year performance
period, then the Company’s TSR would have to be at least 75% for all 25%
of the shares to vest.
EPS condition
The Group’s EPS growth will be measured over a period of
three financial years (2013-2015). The EPS figure used will be
equivalent to the Group’s reported diluted underlying EPS but
with a standard UK tax rate applied (Normalised EPS).
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The following vesting schedule will apply for executive
directors’ PSP awards to be granted in 2013:
Normalised EPS growth
from 2013 to 2015(1)
Less than 22.5%
22.5%
40%
% of award vesting
(maximum 75%)
0%
18.75%
75%
Between 22.5% and 40%
Straight-line vesting
(1) Assuming no change in the enacted UK corporation tax rate of 24% before
the end of the three-year performance period, the benchmark Normalised
EPS for the financial year 2012 from which these growth
targets will be measured is 63.01p.
The Committee regards these targets as stretching,
particularly as the 2012 EPS (the benchmark for the 2013
award) is a record level for the Company. The Committee is
comfortable that these targets are consistent with Company
strategy and with what the Board regards as an acceptable
level of business risk.
The non-executive directors do not participate in, or
benefit from, any of the Company’s share-based incentive or
bonus plans except that Scott Forbes received pre-admission
unapproved options in consideration for his work involved in
the IPO and in accordance with his contractual agreement on
appointment in 2005.
Executive directors are also eligible to participate in the
Company’s employee HMRC Approved Sharesave Plan on
the same terms as other employees. Nick McKittrick and
Peter Brooks-Johnson both contribute the maximum
amounts permitted under the plan, which commenced on
1 November 2012 and which matures in November 2015.
Details are included in the table on pages 38 to 41.
Dilution
All existing executive share-based incentives can be satisfied
from shares held in the Rightmove Employees’ Share Trust
(EBT) and shares held in treasury. It is intended that the 2013
share-based incentive awards would also be settled from
shares currently held in the EBT or from shares held in
treasury without any requirement to issue further shares.
Clawback
The Code provision states that companies should consider
the introduction of ‘clawback’ provisions in ‘exceptional
circumstances of misstatement or misconduct’. As previously
reported, the Committee supports this provision and
introduced relevant clawback clauses in the Group’s DSP
and PSP rules.
Shareholding policy
To be consistent with best practice, a formal share ownership
guideline applies for executive directors requiring them to
retain at least half of any share awards vesting or exercised
(after selling sufficient shares to meet the exercise price and
to pay the tax due) until they have a Rightmove shareholding
worth at least 200% of salary for the Chief Executive Office
and 100% of salary for any other executive director. The value
of the current shareholdings held by the executive directors
as a percentage of base salary is shown in the table on
page 44.
External appointments
With the approval of the Board in each case, executive
directors may accept one external appointment as a
non-executive director of another public company and retain
any fees received.
Ed Williams is a non-executive director of Trader Media
Group. In the year to 31 December 2012 he received fees
of £30,000, which were donated directly to charity.
Chairman’s and non-executive directors’ fees
In 2009, the Board decided to increase fees for the Chairman
and non-executive directors in future years annually, directly
in line with the basic level of pay rise received by employees
within the business until such time as it was considered
appropriate to conduct a wider review of non-executive
director remuneration. Accordingly, the Board approved
an increase to the annual fees payable to the Chairman and
non-executive directors of 3%. With effect from 1 January
2013 the Chairman is entitled to receive a fee of £111,405 per
annum (2011: £108,160). The other non-executive directors
are entitled to receive a basic fee of £44,562 per annum
(2011: £43,264) and an additional £5,570 fee per annum
(2011: £5,408) for the chairing of the Audit and Remuneration
Committees. Jonathan Agnew is paid a further £5,570 fee per
annum (2011: £5,408) as Senior Independent Director.
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Remuneration report continued
The non-executive directors’ fee levels are within the limits
set by the Articles of Association of the Company. The current
fee levels for the non-executive directors with effect from
1 January 2013 are set out in the table below:
Fee
year ended
Increase
1 January 2013
31 December 2012
in fee
Fee
Scott Forbes
£111,405
£108,160
Jonathan Agnew
Colin Kemp
Ashley Martin
Judy Vezmar
£55,702
£44,562
£50,132
£44,562
£54,080
£43,264
£48,672
£43,264
3%
3%
3%
3%
3%
Directors’ service contracts and non-executive
directors’ terms of appointment
The Committee’s policy on service agreements for executive
directors is that they should provide for 12 months’ notice of
termination by the Company and by the executive. Any
proposals for the early termination by the Company of the
service agreements of directors or senior executives are
considered by the Committee.
The service agreements for the executive directors
(Ed Williams, Nick McKittrick and Peter Brooks-Johnson)
allow for lawful termination of employment by making a
payment in lieu of notice or by making phased payments
over any remaining unexpired period of notice. The phased
payments may be reduced if, and to the extent that, the
executive finds an alternative remunerated position.
Scott Forbes’ appointment may be terminated by either
party giving to the other not less than three months’ notice
in writing. The Company may also terminate by making a
payment in lieu of notice. Scott Forbes is not contractually
entitled to any other benefits on termination of his contract
other than in relation to his share options as described in the
table on page 41.
The Letters of Appointment of Jonathan Agnew, Colin
Kemp, Ashley Martin and Judy Vezmar provide for a term of
up to two three-year periods and a possible further three-year
term (subject to re-election by shareholders and subject to
the director remaining independent). The appointments may
be terminated with a notice period of three months on either
side and the Letters of Appointment set out the time
commitments required to meet the expectations of their roles.
Copies are available for inspection on request to the
Company Secretary.
Further details of all directors’ contracts and Letters of
Appointment are summarised below:
Date of appointment
Letter of Appointment(1)
(months)
at 1 March 2013
Date of contract/
Notice
Length of service
Executive directors
Ed Williams (Chief Executive Officer)
19 December 2000
7 February 2006
Nick McKittrick(2)
Peter Brooks-Johnson(3)
Non-executive directors
Scott Forbes (Chairman)
5 March 2004
7 February 2006
10 January 2011
22 February 2011
13 July 2005
21 February 2006
Jonathan Agnew (Senior Independent Director)
16 January 2006
12 December 2005
Colin Kemp
Ashley Martin
Judy Vezmar
3 July 2007
4 December 2007
11 June 2009
9 June 2009
16 January 2006
12 December 2005
12
12
12
12 years 2 months
8 years 11 months
2 years 1 month
3
3
3
3
3
7 years 7 months
7 years 2 months
5 years 7 months
3 years 8 months
7 years 2 months
(1) The service contracts and the Letters of Appointment for all directors with the exception of Peter Brooks-Johnson (who was appointed to the Board on
10 January 2011) were transferred from Rightmove Group Limited to Rightmove plc with effect from 28 January 2008 on completion of a Scheme of
Arrangement under the Companies Act 1985.
(2) Nick McKittrick joined the Group in December 2000 and was appointed to the Board on 5 March 2004. His service with the Group at the date of this report
is 12 years and 2 months.
(3) Peter Brooks-Johnson was appointed to the Board on 10 January 2011. His service with the Group at the date of this report is 7 years and 1 month.
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Directors’ service contracts and non-executive directors’
terms of appointment continued
Retirement arrangements for Ed Williams
As previously described, due to Ed Williams’ retirement
on 30 April 2013, the Committee has determined that he
will not be entitled to receive a bonus for 2013 due to
his service terminating prior to the end of the relevant
performance period. He remains entitled to receive a
bonus in respect of 2012. Additionally, in relation to his
share-based incentives listed in the table on page 39 and
using the discretion afforded to the Committee under the
rules of the relevant plans, he will be treated as a ‘good
leaver’. In respect of his DSP awards, this will result in these
vesting in full on the normal vesting dates. In respect of his
2011 PSP award, this will result in his award vesting in full
on the normal vesting date (March 2014) based on the
extent to which the performance targets are met over the
performance period. In respect of his 2012 PSP award this
will result in, following the application of a pro-rata reduction
to reflect the proportion of the vesting period elapsed until
the date of retirement, the award vesting in March 2015 to
the extent to which the performance targets are met over
the performance period. After applying the pro-rata
reduction, the maximum proportion of the 2012 PSP award
that will be eligible to vest is 36% of the original award.
To the extent that any vested share options remain
unexercised on retirement, Ed Williams will retain a
12 month window within which the options may be
exercised. There will be no other payments made in
respect of Ed Williams’ retirement.
Performance graph
In 2012, the Company’s share price ended the year at
£14.36 up 15% year on year (the FTSE 250 was up 23%).
On a three-year basis the share price has nearly trebled
and has significantly outperformed the FTSE 250 Index
over that period as shown in the graphs at the bottom of
this page.
The graph on the left below compares the TSR of
Rightmove’s shares against the FTSE 250 Index for the period
from 1 January 2010 to 31 December 2012. Specifically, it
illustrates the value of £100 invested in Rightmove’s shares
and in the FTSE 250 Index over that period. This index was
chosen as the comparator because Rightmove is a current
constituent of this index. It was used as a comparator in the
performance condition applying to share options granted in
2010 (50% TSR) and 25% of the PSP awards in 2011 and
2012. It will also be used as the criteria applied to 25% of the
PSP awards to be granted in 2013.
The graph on the right below illustrates, for statutory
purposes, the TSR of Rightmove’s shares against the FTSE
250 Index for the five years to 31 December 2012.
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TSR graph – 3 years
TSR graph – 5 years
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Rightmove
FTSE 250
Source: Datastream
Rightmove
FTSE 250
Source: Datastream
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Remuneration report continued
Part II: Audited information
Directors’ remuneration
The remuneration of the directors of the Company during the year for time served as a director is as follows:
Executive directors
Ed Williams (Chief Executive Officer)
Nick McKittrick
Peter Brooks-Johnson
Non-executive directors
Scott Forbes (Chairman)
Jonathan Agnew (Senior Independent Director)
Colin Kemp(4)
Ashley Martin
Judy Vezmar
Basic salary/
fees
£
2012 cash
bonus payable(1)
Benefits in kind(2)
£
£
2012 total
£
2011 total(3)
£
318,240
318,240
245,000
108,160
54,080
43,264
48,672
43,264
157,529
157,529
121,275
1,576
1,391
4,185
477,345
477,160
370,460
430,233
430,233
323,921
–
–
–
–
–
–
–
–
–
–
108,160
104,000
54,080
43,264
48,672
43,264
52,000
–
46,800
41,600
(1) Bonus relates to the accrued cash payment in respect of the Full Year results for the year ended 31 December 2012. In addition to the 2012 cash bonus noted
above an award of deferred shares worth 85.5% of salary (year ended 31 December 2011: 110% of salary) will be granted to the executive directors under the DSP
in March 2013 and vesting in 2015. The bonus payment reflects the increase in underlying operating profit and strong share price performance in the year,
the measurement of website traffic and the retention of all of Rightmove’s key customers. The Committee believes the resulting bonus payment is appropriate in
the context of the business performance against business targets and relative to prevailing market conditions in the property and media industries.
(2) Benefits in kind for the executive directors relate to private medical insurance (all directors), pension contributions (Peter Brooks-Johnson) and the medical cash
plan (Nick McKittrick).
(3) Additionally, on 2 March 2012, Ed Williams and Nick McKittrick were both awarded 20,183 deferred shares and Peter Brooks-Johnson 14,114 deferred shares
under the DSP which vest in 2014. The monetary value of these awards was £286,000 and £200,000 respectively. The awards related to the bonus in respect
of the Full Year results for the year ended 31 December 2011 and were calculated based upon a share price of £14.17. The awards are included in the table on
pages 39 to 41.
(4) Colin Kemp waived his fee in 2011.
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Share-based incentives held by the directors and not exercised as at 31 December 2012
Share-based
incentives held
1 January
2012
Date
granted
Granted
in year
net of
forfeitures
Exercise
price
Exercised
in year
Share
price at
date of
exercise
Share-based
incentives held at
31 December
2012
Vesting
date(1)
Expiry
date
Executive directors
Ed Williams
(Chief Executive Officer)(1)
14/3/2006
(Approved)
15/3/2006
7,317
–
£4.10
(Unapproved) 1,381,412
–
£3.35
5/3/2009
(Unapproved)
1/10/2009
(Sharesave)
5/3/2010
(Unapproved)
5/3/2010
(DSP)
4/3/2011
(DSP)
4/5/2011
(PSP)
2/3/2012
(DSP)
2/3/2012
(PSP)
373,007(3)
–
£2.24
2,135
–
£4.25
130,474(6)
–
£6.66
29,199
– £0.00
49,289
–
£0.00
–
20,183(10) £0.00
–
14,193(11) £0.00
–
–
–
–
Between
14/3/2009 &
7,317(2) 14/3/2011 13/3/2016
Between
15/3/2009 &
1,381,412(2) 15/3/2011 14/3/2016
373,007
5/3/2012
4/3/2019
2,135
1/11/2012 30/4/2013
130,474
5/3/2013
4/3/2020
–
–
–
–
–
–
–
–
–
–
–
–
–
–
–
29,199
4/3/2013
3/3/2014
49,289
4/3/2014
3/3/2016
20,183
2/3/2014
1/3/2015
14,193
2/3/2015
1/3/2017
2,007,209
39,205
–
£0.00
(39,205)(7)
£15.050
–
5/3/2012
4/3/2013
Total
2,012,038
34,376
–
(39,205)
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Remuneration report continued
Share-based incentives held by the directors and not exercised as at 31 December 2012 continued
Share-based
incentives held
1 January
2012
Date
granted
Granted
in year
Exercise
price
Exercised
in year
Share
price at
date of
exercise
Share-based
incentives held at
31 December
2012
Vesting
date(1)
Expiry
date
Executive directors continued
Nick McKittrick
14/3/2006
(Approved)
15/3/2006
(Unapproved)
10/10/2007
(Unapproved)
5/3/2009
(Unapproved)
1/10/2009
(Sharesave)
5/3/2010
(Unapproved)
5/3/2010
(DSP)
4/3/2011
(DSP)
4/5/2011
(PSP)
2/3/2012
(DSP)
2/3/2012
(PSP)
1/10/2012
(Sharesave)
6,000
–
£4.10
–
–
6,000(2) 14/3/2011 13/3/2016
Between
14/3/2009 &
Between
15/3/2009 &
600,000
–
£3.35 (400,000)(2)
£16.152
200,000(2)
15/3/2011 14/3/2016
75,000(4)
–
£5.22
279,755(3)
–
£2.24
2,135
–
£4.25
114,165(6)
–
£6.66
–
–
–
–
–
–
–
–
75,000
15/3/2011 9/10/2017
279,755
5/3/2012
4/3/2019
2,135
1/11/2012 30/4/2013
114,165
5/3/2013
4/3/2020
31,364
–
£0.00
(31,364)(7)
£16.152
–
5/3/2012
4/3/2013
29,199
– £0.00
49,289
–
£0.00
–
20,183(10) £0.00
–
39,303(11) £0.00
–
694(12) £12.95
–
–
–
–
–
–
–
–
–
–
–
29,199
4/3/2013
3/3/2014
49,289
4/3/2014
3/3/2016
20,183
2/3/2014
1/3/2015
39,303
2/3/2015
1/3/2017
694
1/11/2015 30/4/2016
815,723
Total
1,186,907
60,180
– (431,364)
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Share-based incentives held by the directors and not exercised as at 31 December 2012 continued
Share-based
incentives held
1 January
2012
Date
granted
Granted
in year
Exercise
price
Exercised
in year
Share
price at
date of
exercise
Share-based
incentives held at
31 December
2012
Vesting
date(1)
Expiry
date
Executive directors continued
Peter Brooks-Johnson
14/3/2006
(Approved)
10/10/2007
(Unapproved)
5/3/2009
(Unapproved)
1/10/2009
(Sharesave)
5/3/2010
(Unapproved)
5/3/2010
(DSP)
4/3/2011
(DSP)
4/5/2011
(PSP)
2/3/2012
(DSP)
2/3/2012
(PSP)
1/10/2012
(Sharesave)
Non-executive director
Scott Forbes (Chairman)
15/3/2006
(Unapproved)
2,439
–
£4.10
75,000(4)
–
£5.22
139,286(3)
–
£2.24
2,135
–
£4.25
52,553(6)
–
£6.66
–
–
–
–
–
Between
14/3/2009 &
2,439(2) 14/3/2011 13/3/2016
75,000
15/3/2011 9/10/2017
139,286
5/3/2012
4/3/2019
2,135
1/11/2012 30/4/2013
52,553
5/3/2013
4/3/2020
–
–
–
–
–
34,821
–
£0.00
(34,821)(7)
£16.806
–
5/3/2012
4/3/2013
18,393
–
£0.00
23,697
–
£0.00
–
14,114(10) £0.00
–
25,935(11) £0.00
–
694(12) £12.95
–
–
–
–
–
–
–
–
–
–
–
18,393
4/3/2013
3/3/2014
23,697
4/3/2014
3/3/2016
14,114
2/3/2014
1/3/2015
25,935
2/3/2015
1/3/2017
694
1/11/2015 30/4/2016
354,246
Between
15/3/2007 &
638,729
–
£3.35 (250,000)(5)
£16.152
388,729(5) 15/3/2009 14/3/2016
(1) Details of the treatment of Ed Williams’ share-based incentives on his retirement on 30 April 2013 are set out on page 37
(2) In March 2006, 1,981,412, 987,047 and 257,847 pre-admission options were granted to Ed Williams, Nick McKittrick and Peter Brooks-Johnson under the
Rightmove Unapproved Executive Share Option Plan and 7,317 pre-admission options were granted to each of the executive directors under the Rightmove
Approved Executive Share Option Plan. The options vested as to one third of the number of option shares on each of the third, fourth and fifth anniversaries of
the date of the option grant.
Of the 1,318,412 pre-admission unapproved options and 7,317 pre-admission approved options outstanding for Ed Williams as at 31 December 2012, all options
have vested and are eligible for exercise.
Nick McKittrick exercised 400,000 pre-admission unapproved options in August 2012 and sold all the shares immediately on exercise at a market value of
£16.152 per share. Of the 200,000 pre-admission unapproved options and 6,000 pre-admission approved options outstanding for Nick McKittrick as at
31 December 2012, all options have vested and are eligible for exercise.
Of the 2,439 pre-admission approved options outstanding for Peter Brooks-Johnson as at 31 December 2012, all options have vested and are eligible
for exercise.
(3) The options granted on 5 March 2009 were exercisable from 5 March 2012 at an exercise price of £2.24, subject to 100% TSR performance criteria based
upon the performance of Rightmove’s shares against the FTSE 250 Index for the period from 1 January 2009 to 31 December 2011.
Total
348,324
40,743
–
(34,821)
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Remuneration report continued
Share-based incentives held by the directors and not exercised as at 31 December 2012 continued
Relative TSR condition
Less than the Index
Equal to the Index
25% higher than the Index
Intermediate performance
2009 options exercisable
0%
25%
100%
Straight-line vesting
At the end of the performance period, Rightmove’s TSR was 661% compared to 71% for the FTSE 250 Index. As this level of outperformance was more than
25%, these options vested in full from 5 March 2012.
(4) The options granted on 10 October 2007 were exercisable from 15 March 2011 at an exercise price of £5.22 subject to the basic EPS per the audited
consolidated financial statements for the Group for the year ended 31 December 2010 being not less than 30.0p. All options have vested.
(5) Pre-admission unapproved options granted to Scott Forbes in March 2006 under the Rightmove Unapproved Executive Share Option Plan, vested as to one third
of the number of option shares on each of the first, second and third anniversaries of the date of the option grant.
Scott Forbes exercised 250,000 of the vested pre-admission unapproved options in August 2012 and sold all the shares immediately on exercise at a market
value of £16.152 per share. All pre-admission options outstanding as at 31 December 2012 have vested and are eligible for exercise.
(6) The options granted on 5 March 2010 are exercisable on 5 March 2013 at an exercise price of £6.66 subject to the following performance conditions:
The vesting of 50% of the 2010 award will be dependent on a relative TSR performance criteria based upon the performance of Rightmove’s shares against the
FTSE 250 Index for the period from 1 January 2010 to 31 December 2012.
Relative TSR condition
Less than the Index
Equal to the Index
25% higher than the Index
Intermediate performance
2010 options exercisable (maximum 50%)
0%
12.5%
50%
Straight-line vesting
At the end of the performance period, Rightmove’s TSR was 191% compared to 41% for the FTSE 250 Index. As this level of outperformance is more than 25%,
these options will vest in full from 5 March 2013.
The vesting of 50% of the 2010 award will be dependent on the satisfaction of the Group’s Normalised EPS growth for the period 1 January 2010 to
31 December 2012.
EPS condition
2010 options exercisable up to 200% of salary
2010 options exercisable over 200% of salary
25%
45%
65%
Intermediate performance
0%
In full
–
Straight-line vesting
0%
0%
In full
Straight-line vesting
At the end of the performance period, Rightmove’s normalised EPS growth over the three-year period was 124% and these options will vest in full from
5 March 2013.
(7) On 5 March 2010, Ed Williams, Nick McKittrick and Peter Brooks-Johnson were awarded nil cost deferred shares under the DSP, which vested in full from
5 March 2012. The closing share price on the date of grant was £6.77.
Ed Williams exercised 39,205 deferred shares in April 2012 and sold all the shares immediately on exercise at a market value of £15.050 per share.
Nick McKittrick exercised 31,364 deferred shares in August 2012 and sold all the shares immediately on exercise at a market value of £16.152 per share.
Peter Brooks-Johnson exercised 34,821 deferred shares in August 2012 and sold 26,483 shares immediately on exercise at a market value of £16.806 per share
and retained the balance of 8,338 shares in line with the shareholding policy outlined on page 35 of this report.
(8) On 4 March 2011, Ed Williams, Nick McKittrick and Peter Brooks-Johnson were awarded deferred shares under the DSP, which vest in 2013. The closing share
price on the date of grant was £9.59.
(9) On 4 May 2011, Ed Williams, Nick McKittrick and Peter Brooks-Johnson were awarded 49,289, 49,289 and 23,697 shares respectively under the PSP, which vest
in 2014 and are subject to a mixture of EPS (75% of the awards) and relative TSR (25% of the awards) performance with the greater weighting on EPS to reflect its
particular relevance to the performance of the business. The closing share price on the date of grant was £10.39.
The vesting schedule for the relative TSR element of executive directors’ 2011 PSP awards is set out below. It is consistent with the TSR condition used for
previous grants under the share option scheme. Performance will be measured over three financial years.
Relative TSR condition
Less than the Index
Equal to the Index
25% higher than the Index
Intermediate performance
% of award vesting (maximum 25%)
0%
6.25%
25%
Straight-line vesting
Rightmove’s EPS growth will be measured over a period of three financial years (2011-2013). The EPS figure used will be equivalent to the Normalised EPS.
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Share-based incentives held by the directors and not exercised as at 31 December 2012 continued
The following vesting schedule will apply for executive directors’ awards granted in 2011:
Normalised EPS growth from 2011 to 2013
% of award vesting (maximum 75%)
Less than 25%
25%
50%
Between 25% and 50%
0%
18.75%
75%
Straight-line vesting
Assuming no change in the enacted corporation tax rate of 27% before the end of the three-year performance period, the benchmark Normalised EPS for the
financial year 2010 from which these growth targets will be measured is 37.2p.
(10) On 2 March 2012, Ed Williams, Nick McKittrick and Peter Brooks-Johnson were awarded 20,183, 20,183 and 14,114 deferred shares respectively under the
DSP, which vest in 2014. The closing share price on the date of grant was £14.17.
(11) On 2 March 2012, Ed Williams, Nick McKittrick and Peter Brooks-Johnson were awarded 39,303, 39,303 and 25,935 shares respectively under the PSP, which
vest in 2015 and are subject to a mixture of EPS (75% of the awards) and relative TSR (25% of the awards) performance with the greater weighting on EPS to
reflect its particular relevance to the performance of the business. The closing share price on the date of grant was £14.17. 25,110 of Ed Williams’ PSP shares
have been forfeited in the current year in accordance with the retirement arrangements set out on page 37 under which the 2012 award will be pro-rated to reflect
the proportion of the vesting period lapsed at the date of retirement.
The vesting schedule for the relative TSR element of executive directors’ 2012 PSP awards is set out below. It is consistent with the TSR condition used for
previous grants under the share option scheme. Performance will be measured over three financial years.
Relative TSR condition
Less than the Index
Equal to the Index
25% higher than the Index
Intermediate performance
% of award vesting (maximum 25%)
0%
6.25%
25%
Straight-line vesting
Rightmove’s EPS growth will be measured over a period of three financial years (2012-2014). The EPS figure used will be equivalent to the Normalised EPS.
The following vesting schedule will apply for executive directors’ awards granted in 2012:
Normalised EPS growth from 2012 to 2014
% of award vesting (maximum 75%)
Less than 25%
25%
50%
Between 25% and 50%
0%
18.75%
75%
Straight-line vesting
Assuming no change in the enacted corporation tax rate of 26% before the end of the three-year performance period, the benchmark Normalised EPS for the
financial year 2011 from which these growth targets will be measured is 47.5p.
(12) On 1 November 2012, Nick McKittrick and Peter Brooks-Johnson were granted 694 Sharesave options. The options vest in 2015 and have an exercise price
of £12.95.
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Remuneration report continued
Directors’ interests in shares
The interests (both beneficial and family interests) of the directors in office at 31 December 2012 in the share capital of the
Company were as follows:
Interests in
Interests in
ordinary shares of £0.01
share-based incentives
At
31 December 2012
At
1 January 2012 31 December 2012
At
At
1 January 2012
Executive directors
Ed Williams (Chief Executive Officer)
111,783
1,072,578
2,007,209
2,012,038
Nick McKittrick
Peter Brooks-Johnson
Non-executive directors
Scott Forbes (Chairman)
Jonathan Agnew (Senior Independent Director)
Colin Kemp
Ashley Martin
Judy Vezmar
129,000
129,000
815,723
1,186,907
12,881
4,543
354,246
348,324
619,300
619,300
388,729
638,729
5,000
–
2,060
16,343
5,000
–
2,060
16,343
–
–
–
–
–
–
–
–
• The Company’s shares in issue (including 2,505,430 shares held in treasury) as at 31 December 2012 comprised 105,896,115 (2011: 110,410,636) ordinary
shares of £0.01 each.
• The mid-market share price of the Company was £12.79 as at 3 January 2012 (the first day of trading in 2012) and was £14.36 as at 31 December 2012 (the
last day of trading in 2012). The mid-market high and low share prices of the Company were £17.10 (21 August 2012) and £12.44 (3 January 2012) respectively
in the year.
• The executive directors are regarded as being interested, for the purposes of the Companies Act 2006, in 3,404,029 (2011: 4,527,783) ordinary shares of £0.01
each in the Company currently held by the EBT as they are, together with other employees, potential beneficiaries of the EBT.
• The directors’ beneficial holdings represent 0.9% of the Company’s shares in issue as at 31 December 2012 (2011: 1.7%) (excluding shares held in treasury).
• There have been no changes to the above interests between the year end and the date of this report.
The interests of the executive directors in office at 31 December 2012 in the share capital of the Company as a percentage of
basic salary were as follows:
Number of
Value of
Basic salary
shares held at
Value of shares at
shares as a %
1 January 2013
31 December 2012
31 December 2012
of basic salary
£385,632
£385,632
£289,224
111,783
129,000
12,881
1,605,204
1,852,440
184,971
416
480
64
Executive directors
Ed Williams (Chief Executive Officer)
Nick McKittrick
Peter Brooks-Johnson
Jonathan Agnew
Chairman, Remuneration Committee
1 March 2013
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Auditor’s report
Independent auditor’s report to the members of
Rightmove plc
We have audited the financial statements of Rightmove Plc for
the year ended 31 December 2012 set out on pages 46 to 83.
The financial reporting framework that has been applied in
their preparation is applicable law and International Financial
Reporting Standards (IFRSs) as adopted by the EU and, as
regards the parent Company financial statements, as applied
in accordance with the provisions of the Companies Act 2006.
This report is made solely to the Company’s members, as
a body, in accordance with Chapter 3 of Part 16 of the
Companies Act 2006. Our audit work has been undertaken
so that we might state to the Company’s members those
matters we are required to state to them in an auditor’s report
and for no other purpose. To the fullest extent permitted by
law, we do not accept or assume responsibility to anyone
other than the Company and the Company’s members, as a
body, for our audit work, for this report, or for the opinions we
have formed.
Respective responsibilities of directors and auditor
As explained more fully in the Directors’ Responsibilities
Statement set out on page 29, the directors are responsible
for the preparation of the financial statements and for being
satisfied that they give a true and fair view. Our responsibility
is to audit, and express an opinion on, the financial
statements in accordance with applicable law and
International Standards on Auditing (UK and Ireland).
Those standards require us to comply with the Auditing
Practices Board’s Ethical Standards for Auditors.
Scope of the audit of the financial statements
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.
Opinion on financial statements
In our opinion:
• the financial statements give a true and fair view of the state
of the Group’s and of the parent Company’s affairs as at
31 December 2012 and of the Group’s profit for the year
then ended;
• the Group financial statements have been properly
prepared in accordance with IFRSs as adopted by the EU;
• the parent Company financial statements have been
properly prepared in accordance with IFRSs as adopted by
the EU and as applied in accordance with the provisions of
the Companies Act 2006; and
• 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.
Opinion on other matters prescribed by the
Companies Act 2006
In our opinion:
• the part of the Directors’ Remuneration Report to be
audited has been properly prepared in accordance with
the Companies Act 2006;
• the information given in the Directors’ Report for the
financial year for which the financial statements are
prepared is consistent with the financial statements; and
• information given in the Corporate Governance Statement
set out on pages 23 to 28 with respect to internal control
and risk management systems in relation to financial
reporting processes and about share capital structures
is consistent with the financial statements.
Matters on which we are required to report by exception
We have nothing to report in respect of the following:
Under the Companies Act 2006 we are required to report to
you if, in our opinion:
• adequate accounting records have not been kept by the
parent Company, or returns adequate for our audit have
not been received from branches not visited by us; or
• the parent Company financial statements and the part of
the Directors’ Remuneration Report to be audited are not
in agreement with the accounting records and returns; or
• certain disclosures of directors’ remuneration specified by
law are not made; or
• we have not received all the information and explanations
we require for our audit; or
• a Corporate Governance Statement has not been prepared
by the Company.
Under the Listing Rules we are required to review:
• the directors’ statement, set out on page 28, in relation to
going concern;
• the part of the Corporate Governance Statement on pages
23 to 28 relating to the Company’s compliance with the
nine provisions of the UK Corporate Governance Code
specified for our review; and
• certain elements of the report to shareholders by the Board
on directors’ remuneration.
Stephen Wardell (Senior Statutory Auditor)
for and on behalf of KPMG Audit Plc, Statutory Auditor
Chartered Accountants
Altius House
One North Fourth Street
Milton Keynes, MK9 1NE
1 March 2013
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45
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
119,365
(36,283)
97,017
(34,350)
87,533
(2,410)
(2,041)
69,362
(2,269)
(4,426)
83,082
62,667
240
(129)
111
182
(121)
61
83,193
(20,642)
62,728
(16,674)
62,551
46,054
–
62,551
451
46,505
62,551
46,505
61.30
59.24
61.30
59.24
20.00
20,439
44.37
42.71
43.94
42.29
16.00
16,777
Consolidated statement of comprehensive income
for the year ended 31 December 2012
Continuing operations
Revenue
Administrative expenses
Operating profit before share-based payments and NI
on share-based incentives
Share-based payments
NI on share-based incentives
Operating profit
Financial income
Financial expenses
Net financial income
Profit before tax
Income tax expense
Profit from continuing operations
Discontinued operation
Profit from discontinued operation (net of income tax)
Profit for the year being total comprehensive income
Attributable to:
Equity holders of the parent
Earnings per share (pence)
Basic
Diluted
Earnings per share – continuing operations (pence)
Basic
Diluted
Dividends per share (pence)
Total dividends
Note
5
25
25
6
8
9
10
11
12
12
12
12
13
13
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Consolidated statement of financial position
as at 31 December 2012
Non-current assets
Property, plant and equipment
Intangible assets
Trade and other receivables
Deferred tax assets
Total non-current assets
Current assets
Trade and other receivables
Cash and cash equivalents
Total current assets
Total assets
Current liabilities
Trade and other payables
Income tax payable
Total current liabilities
Non-current liabilities
Provisions
Total non-current liabilities
Total liabilities
Net assets
Equity
Share capital
Other reserves
Retained earnings
Total equity attributable to the equity holders of the parent
Note
14
15
11,17
22
17
18
19
21
23,24
24
24
24
31 December 2012 31 December 2011
£000
£000
1,757
1,616
1,674
9,667
1,120
1,320
1,667
10,684
14,714
14,791
18,476
7,082
14,990
21,768
20,558
36,758
40,272
51,549
(23,738)
(8,892)
(20,874)
(6,021)
(32,630)
(26,895)
(129)
(129)
–
–
(32,759)
(26,895)
7,513
24,654
1,059
373
6,081
1,104
328
23,222
7,513
24,654
The financial statements were approved by the Board of directors on 1 March 2013 and were signed on its behalf by:
Ed Williams
Director
Nick McKittrick
Director
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Company statement of financial position
as at 31 December 2012
Non-current assets
Investments
Deferred tax assets
Total non-current assets
Total assets
Current liabilities
Trade and other payables
Total current liabilities
Net assets
Equity
Share capital
Other reserves
Retained earnings
Total equity attributable to the equity holders of the parent
Note
16
22
31 December 2012 31 December 2011
£000
£000
540,928
7,692
540,094
8,373
548,620
548,467
548,620
548,467
19
(21,181)
(93,315)
(21,181)
(93,315)
527,439
455,152
1,059
107,673
418,707
1,104
106,794
347,254
527,439
455,152
23,24
24
24
24
The financial statements were approved by the Board of directors on 1 March 2013 and were signed on its behalf by:
Ed Williams
Director
Nick McKittrick
Director
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Consolidated statement of cash flows
For the year ended 31 December 2012
Cash flows from operating activities
Profit for the year
Adjustments for:
Depreciation charges
Amortisation charges
Loss on disposal of property, plant and equipment
Loss on disposal of intangible assets
Financial income
Financial expenses
Share-based payments
Gain on sale of discontinued operation (net of income tax)
Income tax expense
Operating cash flow before changes in working capital
Increase in trade and other receivables
Increase in trade and other payables
Increase in provisions
Cash generated from operating activities
Financial expenses paid
Income taxes paid
Net cash from operating activities
Cash flows from investing activities
Interest received
Acquisition of property, plant and equipment
Acquisition of intangible assets
Disposal of discontinued operation (net of cash disposed of)
Net cash (used in)/generated from investing activities
Cash flows from financing activities
Dividends paid
Purchase of own shares for cancellation
Share related expenses
Proceeds on exercise of share-based incentives
Net cash used in financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at 1 January
Note
14
15
8
9
25
11
10
21
14
15
11
13
24
24
24
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
62,551
46,505
752
327
42
1
(240)
129
2,410
–
20,642
661
279
68
26
(182)
121
2,269
(451)
16,674
86,614
65,970
(3,501)
2,879
129
(3,129)
4,870
–
86,121
67,711
(129)
(14,618)
(121)
(14,281)
71,374
53,309
248
(1,431)
(624)
–
186
(361)
(162)
4,888
(1,807)
4,551
(20,439)
(66,359)
(482)
3,027
(16,777)
(48,288)
(323)
6,148
(84,253)
(59,240)
(14,686)
21,768
(1,380)
23,148
Cash and cash equivalents at 31 December
18
7,082
21,768
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Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
155,761
(5,991)
(160,197)
565
1,576
(1,066)
–
499
1,479
(1,880)
(3,361)
(5,893)
90,641
71,281
87,280
65,388
(20,439)
(66,359)
(482)
(16,777)
(48,288)
(323)
(87,280)
(65,388)
–
–
–
–
–
–
Company statement of cash flows
for the year ended 31 December 2012
Cash flows from operating activities
Profit/(loss) for the year
Adjustments for:
Financial income
Financial expenses
Share-based payments
Income tax credit
Operating cash flow before changes in working capital
Increase in trade and other payables
Cash generated from operating activities
Cash flows from financing activities
Dividends paid
Purchase of own shares for cancellation
Share related expenses
Net cash used in financing activities
Net decrease in cash and cash equivalents
Cash and cash equivalents at 1 January
Cash and cash equivalents at 31 December
Note
24
28
25
19
13
24
24
18
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Consolidated statement of changes in shareholders’ equity
for the year ended 31 December 2012
Share
capital
£000
Note
EBT
shares
reserve
£000
Treasury
shares
£000
At 1 January 2011
1,147
(13,937)
(11,917)
Reverse
Other
acquisition
reserves
reserve
£000
147
£000
138
Retained
earnings
£000
Total
equity
£000
52,286
27,864
Total comprehensive income
Profit for the year
Transactions with owners
recorded directly in equity
Share-based payments
Tax credit in respect of share-based
incentives recognised directly
in equity
Dividends to shareholders
Exercise of share-based incentives
Cancellation of own shares
Share related expenses
25
22
13
24
24
24
–
–
–
–
–
(43)
–
–
–
–
–
3,679
–
–
–
–
–
–
–
–
–
–
–
–
–
–
43
–
–
46,505
46,505
–
–
–
–
–
–
2,269
2,269
7,271
(16,777)
2,469
(48,288)
(338)
7,271
(16,777)
6,148
(48,288)
(338)
At 31 December 2011
1,104
(10,258)
(11,917)
190
138
45,397
24,654
At 1 January 2012
1,104
(10,258)
(11,917)
190
138
45,397
24,654
Total comprehensive income
Profit for the year
Transactions with owners
recorded directly in equity
Share-based payments
Tax credit in respect of share-based
incentives recognised directly
in equity
Dividends to shareholders
Exercise of share-based incentives
Cancellation of own shares
Share related expenses
25
22
13
24
24
24
–
–
–
–
–
(45)
–
–
–
–
–
2,347
–
–
–
–
–
–
–
–
–
–
–
–
–
–
45
–
–
62,551
62,551
–
–
–
–
–
–
2,410
2,410
2,136
(20,439)
680
(66,359)
(467)
2,136
(20,439)
3,027
(66,359)
(467)
At 31 December 2012
1,059
(7,911)
(11,917)
235
138
25,909
7,513
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Company statement of changes in shareholders’ equity
for the year ended 31 December 2012
Share
capital
£000
Treasury
shares
£000
Other
reserves
£000
Note
Reverse
acquisition
reserve
£000
Retained
earnings
£000
Total
equity
£000
At 1 January 2011
1,147
(11,917)
2,441
103,520
423,603
518,794
Total comprehensive income
Loss for the year
Transactions with owners
recorded directly in equity
Share-based payments
Tax credit in respect of share-based incentives
recognised directly in equity
Capital contribution
Dividends to shareholders
Cancellation of own shares
Share related expenses
25
22
24
13
24
24
–
–
–
–
–
(43)
–
–
–
–
–
–
–
–
–
–
–
790
–
43
–
–
(5,991)
(5,991)
–
–
–
–
–
–
1,479
1,479
5,483
–
(16,777)
(48,288)
(338)
5,483
790
(16,777)
(48,288)
(338)
At 31 December 2011
1,104
(11,917)
3,274
103,520
359,171
455,152
At 1 January 2012
1,104
(11,917)
3,274
103,520
359,171
455,152
Total comprehensive income
Profit for the year
Transactions with owners
recorded directly in equity
Share-based payments
Tax credit in respect of share-based incentives
recognised directly in equity
Capital contribution
Dividends to shareholders
Cancellation of own shares
Share related expenses
25
22
24
13
24
24
–
–
–
–
–
(45)
–
–
–
–
–
–
–
–
–
–
–
834
–
45
–
–
155,761
155,761
–
–
–
–
–
–
1,576
1,576
1,381
–
(20,439)
(66,359)
(467)
1,381
834
(20,439)
(66,359)
(467)
At 31 December 2012
1,059
(11,917)
4,153
103,520
430,624
527,439
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Notes forming part of the financial statements
1 General information
Rightmove plc (the Company) is a company registered in England (Company no. 6426485) domiciled in the United Kingdom (UK). The
consolidated financial statements of the Company as at and for the year ended 31 December 2012 comprise the Company and its interest
in its subsidiaries (together referred to as the Group). Its principal business is the operation of the rightmove.co.uk website, which has the
largest audience of any UK property website.
The consolidated financial statements of the Group as at and for the year ended 31 December 2012 are available upon request to the
Company Secretary from the Company’s registered office at Turnberry House, 30 Caldecotte Lake Drive, Caldecotte, Milton Keynes, MK7 8LE
or are available on the investor relations website at www.rightmove.co.uk/investors.
Statement of compliance
The Group and Company financial statements have been prepared and approved by the Board of directors in accordance with International
Financial Reporting Standards (IFRSs) as adopted by the European Union (Adopted IFRSs) and issued by the International Accounting
Standards Board (IASB).
The consolidated financial statements were authorised for issue by the Board of directors on 1 March 2013.
Basis of preparation
On publishing the Company financial statements here together with the Group financial statements, the Company is taking advantage of the
exemption in s408 of the Companies Act 2006 not to present its individual statement of comprehensive income and related notes that form
a part of these approved financial statements.
On 21 June 2010 the Group disposed of its 66.7% shareholding in Holiday Lettings (Holdings) Limited (HLHL), which owned 100% of the
shares in the trading entity Holiday Lettings Limited (HLL), (together referred to as the Holiday Lettings segment) to TripAdvisor Limited.
The Holiday Lettings segment has been treated as a discontinued operation in the comparative year.
The accounting policies set out below have been consistently applied to both periods presented, unless otherwise stated.
The financial statements have been prepared on an historical cost basis.
Changes in accounting policies
The accounting policies applied by the Group in these consolidated financial statements are in accordance with Adopted IFRSs and
are the same as those applied by the Group in its consolidated financial statements as at and for the year ended 31 December 2011.
There are no new standards or amendments to standards that are mandatory for the first time for the financial year beginning
1 January 2012 that have an impact on the Group or Company financial statements.
Going concern
Throughout 2012, the Group was debt free, has continued to generate significant cash and has net cash balances of £7,082,000 at
31 December 2012 (2011: £21,768,000).
The Group entered into a 12 month agreement with Barclays Bank Plc for a £10,000,000 uncommitted money market loan on
6 February 2013. To date no amount has been drawn under this facility.
After making enquiries, the Board of directors has a reasonable expectation that the Group and the Company have adequate resources and
banking facilities to continue in operational existence for the foreseeable future. Accordingly, the Board of directors continues to adopt the
going concern basis in preparing the annual report and financial statements.
Further information regarding the Group’s business activities, together with the factors likely to affect its future development, performance
and position are set out in the Business and Financial Review on pages 6 to 15. The financial position of the Group, its cash flows, liquidity
position and borrowing facilities are described in the Financial Position on pages 11 to 15. In addition Note 4 to the financial statements
includes the Group’s objectives, policies and processes for managing its capital; its financial risk management objectives; details of its
financial instruments and its exposures to credit risk and liquidity risk.
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Notes continued
1 General information continued
Capital structure
The Company was incorporated and registered in England and Wales on 14 November 2007 under the Companies Act 1985 as a private
company limited by shares with the name Rightmove Group Limited, registered no. 6426485. The Company was re-registered as a public
limited company under the name Rightmove Group plc on 29 November 2007. On 28 January 2008 the Company became the holding
company of Rightmove Group Limited (formerly Rightmove plc, Company no. 3997679) and its subsidiaries pursuant to a Scheme of
Arrangement under s425 of the Companies Act 1985. The shares in the Company were admitted to trading on the Official List of the London
Stock Exchange on 28 January 2008 and the Company immediately changed its name to Rightmove plc. Details of the share capital of the
Company are disclosed in Note 23.
Basis of consolidation
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. In assessing control, potential voting rights that are currently
exercisable or convertible are taken into account. The financial statements of subsidiaries are included in the consolidated financial
statements from the date that control commences until the date that control ceases.
Judgements and estimates
The preparation of the consolidated financial statements in conformity with Adopted IFRSs requires management to make judgements,
estimates and assumptions that affect the application of accounting policies and the 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 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. Revisions to accounting estimates are recognised in the period
in which the estimate is revised and in any future periods, if applicable.
In particular, information about significant areas of estimation uncertainty and critical judgements in applying accounting policies that have the
most significant effect on the amounts recognised in the consolidated financial statements is included in the following notes:
Note 22
Note 25
Deferred tax assets relating to the rate at which the asset will reverse and the recoverability of the asset
Measurement of share-based payments relating to the inputs to the fair value models and the estimate of the number of shares
that will eventually be issued
2 Significant accounting policies
(a) Investments
Investments in subsidiaries are held at cost less any provision for impairment in the parent Company financial statements.
(b) Intangible assets
(i) Goodwill
All business combinations are accounted for by applying the purchase method. Goodwill that arises upon the acquisition of subsidiaries
is included in intangible assets. In respect of business acquisitions that have occurred since 1 January 2004, goodwill represents the
difference between the cost of the acquisition and the fair value of the net identifiable assets acquired.
In respect of acquisitions prior to this date, goodwill is included on the basis of its deemed cost, which represents the amount previously
recorded under UK Generally Accepted Accounting Principles (GAAP). The classification and accounting treatment of business
combinations that occurred prior to 1 January 2004 were not reconsidered in preparing the Group’s opening IFRS statement of financial
position at 1 January 2004.
Goodwill is stated at cost less any accumulated impairment losses. Goodwill is tested annually for impairment. This applies to all
goodwill arising both before and after 1 January 2004.
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2 Significant accounting policies continued
(ii) Research and development
The Group undertakes research and development expenditure in view of developing new products and improving the existing property
websites. Expenditure on research activities, undertaken with the prospect of gaining new technical knowledge and understanding, is
recognised in profit or loss as incurred.
Expenditure on development activities, whereby research findings are applied to a plan or design for the production of a new product or
substantially enhanced website, is capitalised if the new product or the enhanced website is technically and commercially feasible and
the Group has sufficient resources to complete development.
The expenditure capitalised includes subcontractors and direct labour. Capitalised development expenditure is stated at cost less
accumulated amortisation and accumulated impairment losses. Subsequent expenditure on capitalised intangible assets is capitalised
only when it increases the economic benefits embodied in the specific asset to which it relates. All other expenditure is expensed
when incurred.
(iii) Computer software and licences
Computer software and externally acquired software licences are capitalised and stated at cost less accumulated amortisation and
impairment losses. Amortisation is charged from the date the asset is available for use. Amortisation is provided to write off the cost
less the estimated residual value of the computer software or licence by equal annual instalments over its estimated useful economic life
as follows:
Computer software
Software licences
20.0% – 33.3% per annum
20.0% – 33.3% per annum
(c) Property, plant and equipment
Property, plant and equipment are stated at cost less accumulated depreciation and impairment losses. Depreciation is provided to write off
the cost less the estimated residual value of property, plant and equipment by equal annual instalments over their estimated useful economic
lives as follows:
Office equipment, fixtures & fittings
Computer equipment
Leasehold improvements
20.0% per annum
20.0% – 33.3% per annum
remaining life of the lease
(d) Impairment
The carrying value of property, plant and equipment is reviewed at each reporting date to determine whether there is any indication of
impairment. If any such indication exists, the asset’s recoverable amount is estimated. An impairment loss is recognised for the amount by
which the asset’s carrying amount exceeds its recoverable amount. The recoverable amount of non-financial assets is the greater of their fair
value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value
using a pre-tax discount rate that reflects current market assessments of the time value of money and the risks specific to the asset. For an
asset that does not generate largely independent cash flows, the recoverable amount is determined for the cash generating unit to which the
asset belongs.
Goodwill and intangible assets that have an indefinite useful life are not subject to amortisation but are tested for impairment annually and
whenever there is an indication that they might be impaired. An impairment loss is recognised for the amount by which the carrying value of
the asset exceeds its recoverable amount.
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Notes continued
2 Significant accounting policies continued
Investments are assessed for possible impairment when there is an indication that the fair value of the investments may be below the
Company’s carrying value. When such a condition is deemed to be other than temporary, the carrying value of the investment is written
down to its fair value and the amount written off is included in profit or loss. In making the determination as to whether a decline is other
than temporary, the Company considers such factors as the duration and extent of the decline, the investee’s financial performance and
the Company’s ability and intention to retain its investment for a period that will be sufficient to allow for any anticipated recovery in the
investment’s market value.
(e) Financial instruments
Trade receivables are recognised at fair value less any impairment loss. A provision for impairment of trade receivables is established when
there is objective evidence that the Group will not be able to collect all amounts due according to the original terms of receivables.
Inter-group balances and transactions, and any unrealised income and expenses arising from inter-group transactions, are eliminated in
preparing the consolidated financial statements.
Trade payables are recognised at fair value. Trade payables are classified as current liabilities unless the Group has an unconditional right to
defer settlement of the liability for at least 12 months after the reporting date.
(f) Cash and cash equivalents
Cash and cash equivalents comprise cash balances and call deposits with original maturities of three months or less.
(g) Provisions
A provision is recognised if, as a result of a past event, the Group has a present legal or constructive obligation that can be estimated
reliably and it is probable that an outflow of economic benefits will be required to settle the obligation.
Provisions are determined by discounting the expected future cash flows at a pre-tax rate that reflects current market assessment of the
time value of money and the risks specific to the liability. The unwinding of the discount is recognised as a finance cost.
A provision is maintained in respect of lease dilapidations based on an estimated cost to make good per square foot multiplied by the floor
area of each premise.
(h) Employee benefits
(i) Pensions
The Group provides access to a stakeholder pension scheme (a defined contribution pension plan) into which employees may elect to
contribute via salary exchange. Obligations for contributions to defined contribution pension plans are recognised as an employee benefit
expense in profit or loss when they are due.
(ii) Employee share schemes
The Group provides share-based incentive plans allowing executive directors and other selected senior management to acquire shares
in the Company. An expense is recognised in profit or loss, with a corresponding increase in equity, over the period to which the
employees become unconditionally entitled, on equity settled share-based incentive schemes granted after 7 November 2002 and
which had not vested by 1 January 2005.
Fair value is measured using either the Monte Carlo or Black Scholes pricing model as is most appropriate for each scheme.
Measurement inputs include share price on measurement date, exercise price of the instrument, expected volatility (based on weighted
average historic volatility adjusted for changes expected due to publicly available information), weighted average expected life of the
instruments (based on historical experience and general option behaviour), expected dividends, and risk-free interest rates (based on
government bonds). Service and non-market performance conditions attached to the awards are not taken into account in determining
the fair value.
For share-based incentive awards with non-vesting conditions, the grant date fair value of the share-based incentives is measured to
reflect such conditions and there is no true-up for differences between expected and actual outcomes. When either the employee or the
Company chooses not to meet the non-vesting condition, the failure to meet the non-vesting condition is treated as a cancellation and
the cost that would have been recognised over the remainder of the vesting period is recognised immediately in profit or loss.
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2 Significant accounting policies continued
(iii) Own shares held by The Rightmove Employees’ Share Trust (EBT)
The EBT is treated as an agent of Rightmove Group Limited and as such EBT transactions are treated as being those of
Rightmove Group Limited and are therefore reflected in the Group’s consolidated financial statements. In particular, at a consolidated
level, the EBT’s purchases of shares in the Company are debited directly to equity.
(iv) National Insurance (NI) on share-based incentives
Employer’s NI is accrued, where applicable, at a rate of 13.8%, which management expects to be the prevailing rate when share-based
incentives are exercised. In the case of share options, it is provided on the difference between the share price at the reporting date and
the average exercise price of share options. In the case of performance shares and deferred shares at nil cost, it is provided based on
the share price at the reporting date.
(i) Treasury shares and shares purchased for cancellation
When share capital recognised as equity is repurchased, the amount of the consideration paid, including directly attributable costs, is
recognised as a deduction from equity. Repurchased shares are either held in treasury or cancelled.
(j) Revenue
Revenue principally represents the amounts, excluding value added tax (VAT), receivable from customers in respect of properties advertised
on Group websites. All revenue is recognised in the month to which it relates. Agency and overseas branches are billed in advance with
net revenue deferred until the service commencement date. The VAT liability is recognised at the point of invoice. New homes developers
are typically billed monthly in arrears. Where invoices are raised on other than a monthly basis, the amounts are recognised as deferred
or accrued revenue and released to the income statement on a monthly basis in line with the provision of services as stipulated in the
contract terms.
(k) Segmental reporting
An operating segment is a component of the Group that engages in business activities from which it may earn revenues and incur expenses,
including revenues and expenses that relate to transactions with any of the Group’s other components. An operating segment’s operating
results are reviewed regularly by the Group’s Chief Executive Officer to make decisions about resources to be allocated to the segment and
assess its performance and for which discrete financial information is available.
(l) Leases
Operating lease rentals are charged to profit or loss on a straight-line basis over the period of the lease. Where cash is received in exchange
for entering into a lease with rates above market value, this upfront payment is deferred and released on a straight-line basis over the lease
term.
(m) Financial income and expenses
Financial income comprises interest receivable on cash balances, deposits and dividend income. Interest income is recognised as it accrues,
using the effective interest method. Dividend income is recognised on the date that the Company’s right to receive payment is established.
Financial expenses comprise debt issue costs and bank charges and the unwinding of the discount on provisions.
(n) Taxation
Income tax on the results for the year comprises current and deferred tax. Income tax is recognised in profit or loss except to the extent that
it relates to items recognised directly in equity, in which case it is recognised in equity.
Current tax is the expected tax payable on the taxable income for the period net of any charge or credit posted directly to equity, using tax
rates enacted or substantially enacted at the reporting date and any adjustment to tax payable in respect of previous periods.
Deferred tax is provided in respect of 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
the 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 substantially enacted by the reporting date.
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Notes continued
2 Significant accounting policies continued
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.
In accordance with IAS 12, the Group policy in relation to the recognition of deferred tax on share-based incentives is to include the income
tax effect of the tax deduction in profit or loss to the value of the income tax charge on the cumulative IFRS 2 charge. The remainder of the
income tax effect of the tax deduction is recognised in equity.
(o) Dividends
Dividends unpaid at the reporting date are only recognised as a liability (and deduction to equity) at that date to the extent that they are
appropriately authorised and are no longer at the discretion of the Company. Unpaid dividends that do not meet these criteria are disclosed
in the notes to the financial statements.
(p) Earnings per share
The Group presents basic, diluted and underlying earnings per share (EPS) data for its ordinary shares. Basic EPS is calculated by dividing
the profit or loss attributable to equity holders of the Company by the weighted average number of ordinary shares outstanding during the
year, adjusted for own shares held. Diluted EPS is determined by adjusting the profit or loss attributable to ordinary shareholders and the
weighted average number of ordinary shares outstanding, adjusted for own shares held, for the effects of all potential dilutive instruments,
which comprise share-based incentives granted to employees. The calculation of underlying EPS is disclosed in Note 12.
(q) Discontinued operations
A discontinued operation is a component of the Group’s business that represents a separate major line of business or geographical area
of operations that has been disposed of, or is held for sale or distribution, or is a subsidiary acquired exclusively with a view to resale.
Classification as a discontinued operation occurs upon disposal or when the operation meets the criteria to be classified as held for sale,
if earlier. When an operation is classified as a discontinued operation, the comparative statement of comprehensive income is restated as
if the operation had been discontinued from the start of the comparative year.
3 IFRSs not yet applied
A number of new standards, amendments to standards and interpretations are not yet effective for the year ended 31 December 2012 and
have not been applied in preparing these consolidated financial statements. None of these are expected to have a significant effect on the
consolidated financial statements of the Group.
4 Financial risk management
Overview
The Group has exposure to the following risks from its use of financial instruments:
credit risk
•
•
liquidity risk
• market risk
•
operational risk
This note presents information about the Group and Company’s exposure to each of the above risks, the Group’s objectives, policies and
processes for measuring and managing risk and the Group’s management of capital. Further quantitative disclosures are included throughout
these consolidated financial statements.
The Board of directors has overall responsibility for the establishment and oversight of the Group’s risk management framework. The primary
method by which risks are monitored and managed by the Group is through the monthly Executive Management Board, where any
significant new risks or change in status to existing risks will be discussed and actions taken as appropriate.
The Group’s risk management policies are established to identify and analyse the risks faced by the Group, to set appropriate risk limits and
controls and to monitor risks and adherence to limits. Risk management policies and systems are reviewed regularly to reflect changes in
market conditions and the Group’s activities. The Group, through its training and management standards and procedures, aims to develop a
disciplined and constructive control environment in which all employees understand their roles and obligations.
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4 Financial risk management continued
The Audit Committee oversees how management monitors compliance with the Group’s internal controls and reviews the adequacy of the
risk management framework in relation to the risks faced by the Group.
Credit risk
Credit risk is the risk of financial loss to the Group if a customer fails to meet its contractual obligations.
The Group’s exposure to credit risk is influenced mainly by the individual characteristics of each customer. The Group provides credit to
customers in the normal course of business. The Group provides its services to a wide range of customers in the UK and overseas and
therefore believes it has no material concentration of credit risk.
More than 94.0% of the Group’s agency and new homes customers pay via monthly direct debit, minimising the risk of non-payment.
The Group establishes an allowance for impairment that represents its estimate of incurred losses in respect of trade and other receivables
based on individually identified loss exposures.
Liquidity risk
Liquidity risk is the risk that the Group will encounter difficulties in meeting the obligations associated with its financial liabilities that are
settled by delivering cash. The Group and Company’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, under both normal and stressed conditions, without incurring unacceptable losses or risking
damage to the Group’s reputation.
The Group’s revenue model is largely subscription-based, which results in a regular level of cash conversion allowing it to service working
capital requirements.
The Group and Company ensure that they have sufficient cash on demand to meet expected operational expenses excluding the potential
impact of extreme circumstances that cannot reasonably be predicted, such as natural disasters. Throughout the year, the Group typically
had sufficient cash on demand to meet operational expenses on continuing operations, before financing activities, for a period of 256 days
(2011: 342 days).
The Group entered into a 12 month agreement with Barclays Bank Plc for a £10,000,000 uncommitted money market loan on
6 February 2013. To date no amount has been drawn under this facility.
Market risk
Market risk is the risk that changes in market prices such as foreign exchange and interest rates will affect the Group’s income. The objective
of market risk management is to manage and control market risk exposures within acceptable parameters, while optimising the return on risk.
(i) Currency risk
All of the Group’s sales and more than 95.0% of the Group’s purchases are Sterling denominated, accordingly it has no significant
currency risk.
(ii) Interest rate risk
The Group and Company have no interest bearing financial liabilities. The Group is exposed to interest rate risk on cash balances and
amounts held in Escrow.
Operational risk
Operational risk is the risk of direct or indirect loss arising from a wide variety of causes associated with the Group’s processes, personnel,
technology and infrastructure, and from external factors other than credit, market and liquidity risks, such as those arising from legal and
regulatory requirements and generally accepted standards of corporate behaviour. Operational risks arise from all of the Group’s operations.
The Group’s objective is to manage operational risk so as to balance the avoidance of financial losses and damage to the Group’s reputation
with overall cost effectiveness and to avoid control procedures that restrict initiative and creativity.
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Notes continued
4 Financial risk management continued
The primary responsibility for the development and implementation of controls to address operational risk is assigned to senior management
within each business unit. This responsibility is supported by the development of overall Group standards for the management of operational
risk in the following areas:
•
•
•
• documentation of controls and procedures;
•
requirements for appropriate segregation of duties, including the independent authorisation of transactions;
requirements for the reconciliation and monitoring of transactions;
compliance with regulatory and other legal requirements;
requirements for the periodic assessment of operational risks faced and the adequacy of controls and procedures to address the
risks identified;
requirements for reporting of operational losses and proposed remedial action;
•
• development and regular testing of contingency plans;
•
•
training and professional development; and
risk mitigation, including insurance where this is effective.
Capital management
The Board of directors’ policy is to maintain an efficient statement of financial position so as to maintain investor, creditor and market
confidence and to sustain future development of the business. The Board of directors considers that the future working capital and capital
expenditure requirements of the Group will continue to be low and accordingly return on capital measures are not key performance targets.
The Board of directors monitors the spread of the Company’s shareholders as well as underlying earnings per share. The Board of directors
has a progressive dividend policy and also monitors the level of dividends to ordinary shareholders in relation to profit growth. The Board’s
policy is to return surplus capital to shareholders through a combination of dividends and share buybacks.
The Company purchases its own shares in the market; the timing of these purchases depends on market conditions. In 2012, 4,514,521
(2011: 4,350,798) shares were bought back and were cancelled at an average price of £14.70 (2011: £11.10).
There were no changes in the Group’s approach to capital management during the year. Neither the Company nor any of its subsidiaries are
subject to externally imposed capital requirements.
5 Operating segments
The Group determines and presents operating segments based on internal information that is provided to the Chief Executive Officer, who is
the Group’s Chief Operating Decision Maker.
The Group’s reportable segments are as follows:
•
•
The Agency segment which provides resale and lettings property advertising services on www.rightmove.co.uk; and
The New Homes segment which provides property advertising services to new home developers and housing associations on
www.rightmove.co.uk.
The Other segment which represents activities under the reportable segments threshold, comprises overseas and commercial property
advertising services on www.rightmove.co.uk and non-property advertising services which include business and information services and
Automated Valuation Model services.
Management monitors the business segments at a revenue and trade receivables level separately for the purpose of making decisions
about resources to be allocated and of assessing performance. All revenues in both years are derived from third parties and there are no
inter-segment revenues.
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5 Operating segments continued
Operating costs, financial income, financial expenses and income taxes in relation to the Agency, New Homes and the Other segment are
managed on a centralised basis at a Rightmove Group Limited level and as there are no internal measures of individual segment profitability,
relevant disclosures have been shown under the heading of Central in the table below:
Profit or loss segmental disclosures have been made on a continuing operations basis.
The Company has no reportable segments.
Operating segments
Year ended 31 December 2012
Revenue
Operating profit(1)
Depreciation and amortisation
Financial income
Financial expenses
Trade receivables(3)
Other segment assets
Segment liabilities
Capital expenditure(6)
Year ended 31 December 2011
Revenue
Operating profit(1)
Depreciation and amortisation
Financial income
Financial expenses
Trade receivables(3)
Other segment assets
Segment liabilities
Capital expenditure(6)
Agency
£000
92,387
–
–
–
–
10,693
–
–
–
77,388
–
–
–
–
9,907
–
–
–
New
Homes
£000
20,599
–
–
–
–
4,003
–
–
–
16,869
–
–
–
–
2,677
–
–
–
Sub
total
£000
112,986
–
–
–
–
14,696
–
–
–
94,257
–
–
–
–
12,584
–
–
–
Other
£000
Central
Adjustments
£000
£000
Total
£000
6,379
–
–
–
–
1,290
–
–
–
2,760
–
–
–
–
498
–
–
–
–
87,533
(1,079)
240
(129)
–
24,219
(32,692)
2,055
–
69,362
(940)
182
(121)
–
38,405
(26,833)
523
–
(4,451)(2)
–
–
–
51(4)
16(5)
(67)(4)(5)
–
119,365
83,082
(1,079)
240
(129)
16,037
24,235
(32,759)
2,055
–
(6,695)(7)
–
–
–
50(4)
12(5)
(62)(4)(5)
–
97,017
62,667
(940)
182
(121)
13,132
38,417
(26,895)
523
(1) Operating profit is stated after the charge for depreciation and amortisation.
(2) Operating profit for the year ended 31 December 2012 does not include share-based payments charge (£2,410,000) and NI on
share-based incentives (£2,041,000).
(3) The only segment assets that are separately monitored by the Chief Operating Decision Maker relate to trade receivables net of any
associated provision for impairment. All other segment assets are reported on a centralised basis.
(4) The adjustments column reflects the reclassification of credit balances in accounts receivable made on consolidation for statutory
accounts purposes.
(5) The adjustments column reflects the reclassification of debit balances in accounts payable made on consolidation for statutory
accounts purposes.
(6) Capital expenditure consists of additions of property, plant and equipment and intangible assets (excluding goodwill).
(7) Operating profit for the year ended 31 December 2011 does not include share-based payments charge (£2,269,000) and NI on
share-based incentives (£4,426,000).
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Notes continued
5 Operating segments continued
Geographic information
In presenting information on the basis of geography, revenue and assets are based on the geographical location of customers.
Group
UK
Rest of the world
6 Operating profit
Operating profit is stated after charging:
Employee benefit expense
Depreciation of property, plant and equipment
Amortisation of computer software
Loss on disposal of property, plant and equipment
Loss on disposal of intangible assets
Bad debt impairment charge
Operating lease rentals
Land and buildings
Other
Auditor’s remuneration
Year ended 31 December 2012
Revenue Trade receivables
£000
£000
118,329
1,036
15,954
83
Year ended 31 December 2011
Revenue
Trade receivables
£000
96,135
882
£000
13,086
46
119,365
16,037
97,017
13,132
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
17,540
752
327
42
1
198
899
432
15,562
661
279
68
26
315
746
332
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
Fees payable to the Company’s auditor in respect of the audit
Audit of the Company’s financial statements
Audit of the Company’s subsidiaries pursuant to legislation
Total audit remuneration
Fees payable to the Company’s auditor in respect of non-audit related services
Tax compliance services and advisory
All other services
Total non-audit remuneration
15
102
117
11
17
28
14
99
113
11
4
15
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7 Employee numbers and costs
The average number of persons employed (including executive directors) during the year, analysed by category, was as follows:
Administration
Management
The aggregate payroll costs of these persons were as follows:
307
18
325
277
16
293
Year ended
Year ended
31 December 2012 31 December 2011
Number of
employees
Number of
employees
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
Wages and salaries
Social security costs
Pension costs
8 Financial income
Interest income on cash balances
Interest income on amounts held in Escrow
9 Financial expenses
15,281
1,887
372
13,647
1,640
275
17,540
15,562
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
233
7
240
182
–
182
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
Other financial expenses
129
121
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Notes continued
10 Income tax expense
Current tax expense
Current year
Adjustment to current tax charge in respect of prior years
Deferred tax credit
Origination and reversal of temporary differences
Adjustment to deferred tax charge in respect of prior years
Reduction in tax rate
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
20,805
(15)
16,748
(34)
20,790
16,714
(299)
(4)
155
(148)
(70)
7
23
(40)
Total income tax expense from continuing operations
20,642
16,674
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
(3,301)
(3,302)
1,165
(3,969)
(2,136)
(7,271)
Income tax (credit)/charge recognised directly in equity
Current tax
Share-based incentives
Deferred tax
Share-based incentives
Total income tax credit recognised directly in equity
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10 Income tax expense continued
Reconciliation of effective tax rate
The Group’s income tax expense for the year is higher (2011: lower) than the standard rate of corporation tax in the UK of 24.5%
(2011: 26.5%). The differences are explained below:
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
Profit for the year
Total income tax expense
Profit excluding income tax
Current tax at 24.5% (2011: 26.5%)
Reduction in tax rate
Non-deductible expenses
Share-based incentives
Adjustment to current tax charge in respect of prior years
Adjustment to deferred tax charge in respect of prior years
Exempt income on sale of discontinued operation
62,551
20,642
83,193
20,382
155
107
17
(15)
(4)
–
46,505
16,674
63,179
16,742
23
46
10
(34)
7
(120)
20,642
16,674
The Group’s consolidated effective tax rate on the profit of £83,193,000 from continuing operations for the year ended 31 December 2012
is 24.8% (2011: 26.6%). The difference between the standard rate and effective rate on continuing operations at 31 December 2012 is
attributable to a reduction in the rate at which the deferred tax asset is recognised 0.2% (2011: 0.0%) and disallowable expenditure 0.1%
(2011: 0.1%).
11 Discontinued Operation
On 21 June 2010 the Group sold its 66.7% shareholding in HLHL, which owned 100% of the shares in the trading entity HLL, to TripAdvisor
Limited, a wholly owned subsidiary of Expedia Inc.
Contingent consideration was dependent on the performance of HLL for the 12 month period from 1 April 2010 to 31 March 2011.
The value of the contingent consideration was revised upwards by £451,000 from £5,104,000 as reported at 31 December 2010 to a final
agreed amount of £5,555,000. £4,888,000 contingent consideration was received in October 2011 with £667,000 being transferred into an
Escrow account in addition to the £1,000,000 of completion proceeds already held in Escrow and classified as non-current.
Under the terms of the sale agreement the amounts held in Escrow earn interest at Barclays Bank Plc’s current interest rate and become
available on the fourth anniversary of the completion date of the transaction. No discount has been applied as the account is interest
bearing and £7,000 has been credited to profit or loss in the current year, bringing the total amount held in Escrow to £1,674,000
(2011: £1,667,000) (refer Note 17).
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Notes continued
12 Earnings per share (EPS)
Year ended 31 December 2012
Basic EPS
Diluted EPS
Underlying basic EPS
Underlying diluted EPS
Year ended 31 December 2011
Basic EPS
Diluted EPS
Underlying basic EPS
Underlying diluted EPS
Weighted average
number of
ordinary shares
Continuing
operations
£000
Discontinued
operation
£000
102,036,054
105,587,648
102,036,054
105,587,648
104,809,475
108,891,146
104,809,475
108,891,146
62,551
62,551
67,002
67,002
46,054
46,054
52,749
52,749
–
–
–
–
451
451
451
451
Total
earnings
£000
62,551
62,551
67,002
67,002
46,505
46,505
53,200
53,200
Pence
per share
61.30
59.24
65.67
63.46
44.37
42.71
50.76
48.86
Weighted average number of ordinary shares (basic)
Issued ordinary shares at 1 January less ordinary shares held by the EBT
Effect of own shares held in treasury
Effect of own shares purchased for cancellation
Effect of share-based incentives exercised
Year ended
Year ended
31 December 2012 31 December 2011
Number of shares Number of shares
105,882,853
(2,505,430)
(1,846,076)
504,707
108,439,105
(2,505,430)
(1,904,709)
780,509
102,036,054
104,809,475
Weighted average number of ordinary shares (diluted)
For diluted EPS, the weighted average number of ordinary shares in issue is adjusted to assume conversion of all potentially dilutive shares.
The Group’s potential dilutive instruments are in respect of share-based incentives granted to employees, which will be settled by ordinary
shares held by the EBT and shares held in treasury.
Weighted average number of ordinary shares (basic)
Dilutive impact of share-based incentives outstanding
Year ended
Year ended
31 December 2012 31 December 2011
Number of shares Number of shares
102,036,054
3,551,594
104,809,475
4,081,671
105,587,648
108,891,146
The average market value of the Group’s shares for the purposes of calculating the dilutive effect of share-based incentives was based on
quoted market prices for the period during which the share-based incentives were outstanding.
Underlying EPS
Underlying EPS is calculated before the charge for share-based payments and NI on share-based incentives but without any adjustment to
the tax charge in respect of these items. A reconciliation of the basic earnings for the year to the underlying earnings is presented below:
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Basic earnings for the year
Share-based payments
NI on share-based incentives
Underlying earnings for the year
Year ended
Year ended
31 December 2012 31 December 2011
£000
£000
62,551
2,410
2,041
46,505
2,269
4,426
67,002
53,200
13 Dividends
Dividends declared and paid by the Company were as follows:
2010 final dividend paid
2011 interim dividend paid
2011 final dividend paid
2012 interim dividend paid
2012
2011
Pence per share
£000
Pence per share
–
–
11.0
9.0
–
–
11,273
9,166
9.0
7.0
–
–
£000
9,499
7,278
–
–
20.0
20,439
16.0
16,777
After the reporting date a final dividend of 14.0p (2011: 11.0p) per qualifying ordinary share being £13,981,000 (2011: £11,328,000) was
proposed by the Board of directors.
The 2011 final dividend paid on 8 June 2012 was £11,273,000 being a difference of £55,000 compared to that reported in the 2011 Annual
Report, which was due to a reduction in the ordinary shares entitled to a dividend between 31 December 2011 and the final dividend record
date of 11 May 2012.
The 2012 interim dividend paid on 9 November 2012 was £9,166,000 being a difference of £30,000 compared to that reported in the
2012 Half Year Report, which was due to an increase in the ordinary shares entitled to a dividend between 30 June 2012 and the interim
dividend record date of 12 October 2012.
The terms of the EBT provide that dividends payable on the ordinary shares held by the EBT are waived. No provision was made for the final
dividend in either year and there are no income tax consequences.
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14 Property, plant and equipment
Group
Cost
At 1 January 2012
Additions
Disposals
Office equipment,
Computer
Leasehold
Work
fixtures & fittings
equipment
improvements
in progress
£000
£000
£000
£000
698
152
(203)
2,486
741
(101)
102
451
(102)
At 31 December 2012
647
3,126
451
Depreciation
At 1 January 2012
Charge for year
Disposals
(504)
(76)
173
(1,585)
(616)
89
At 31 December 2012
(407)
(2,112)
Net book value
At 31 December 2012
At 1 January 2012
240
194
1,014
901
(77)
(60)
102
(35)
416
25
–
87
–
87
–
–
–
–
87
–
Total
£000
3,286
1,431
(406)
4,311
(2,166)
(752)
364
(2,554)
1,757
1,120
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2
0
1
2
67
Notes continued
14 Property, plant and equipment continued
Group
Cost
At 1 January 2011
Additions
Disposals
Office equipment,
Computer
Leasehold
Work
fixtures & fittings
equipment
improvements
in progress
£000
£000
£000
£000
734
9
(45)
2,668
352
(534)
At 31 December 2011
698
2,486
Depreciation
At 1 January 2011
Charge for year
Disposals
(462)
(82)
40
(1,538)
(518)
471
At 31 December 2011
(504)
(1,585)
Net book value
At 31 December 2011
At 1 January 2011
194
272
901
1,130
The work in progress consists of a new finance system that will be brought into use in 2013.
The Company has no property, plant or equipment in either year.
15 Intangible assets
Group
Cost
At 1 January 2012
Additions
Disposals
At 31 December 2012
Amortisation
At 1 January 2012
Charge for year
Disposals
At 31 December 2012
Net book value
At 31 December 2012
At 1 January 2012
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Total
£000
3,504
361
(579)
3,286
(2,016)
(661)
511
(2,166)
1,120
1,488
Total
£000
3,825
624
(32)
–
–
–
–
–
–
–
–
–
–
Computer
software
£000
3,093
624
(32)
3,685
4,417
(2,505)
(327)
31
(2,505)
(327)
31
(2,801)
(2,801)
884
588
1,616
1,320
102
–
–
102
(16)
(61)
–
(77)
25
86
Goodwill
£000
732
–
–
732
–
–
–
–
732
732
15 Intangible assets continued
Group
Cost
At 1 January 2011
Additions
Disposals
At 31 December 2011
Amortisation
At 1 January 2011
Charge for year
Disposals
At 31 December 2011
Net book value
At 31 December 2011
At 1 January 2011
Goodwill
£000
732
–
–
732
–
–
–
–
732
732
Computer
software
£000
3,252
162
(321)
Total
£000
3,984
162
(321)
3,093
3,825
(2,521)
(279)
295
(2,521)
(279)
295
(2,505)
(2,505)
588
731
1,320
1,463
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The Company has no intangible assets in either year.
Impairment testing for cash generating units containing goodwill
For the purpose of impairment testing, goodwill is allocated to the Group’s operations which represent the lowest level within the Group at
which goodwill is monitored for internal management purposes, which is not higher than the Group’s operating segments as reported
in Note 5.
The aggregate carrying amounts of goodwill allocated to each unit are as follows:
Agency
31 December 2012 31 December 2011
£000
£000
732
732
The carrying value of the £732,000 purchased goodwill in Agency, arising pre-transition to IFRS, is reviewed annually for impairment.
Due to its level of significance the disclosures as required by IAS 36 Impairment of Assets have not been made.
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69
Notes continued
16 Investments
The subsidiaries of the Group as at 31 December 2012 are as follows:
Company
Rightmove Group Limited
Rightmove.co.uk Limited
Rightmove Home Information
Packs Limited
Nature of business
Country of
incorporation
Online advertising
Dormant
England and Wales
England and Wales
Holding
Class of shares
100%
100%
Ordinary
Ordinary
Dormant
England and Wales
100%
Ordinary
All the above subsidiaries are included in the Group consolidated financial statements.
Company
Investment in subsidiary undertakings
At 1 January
Additions – subsidiary share-based payments charge (refer Note 25)
At 31 December
31 December 2012 31 December 2011
£000
£000
540,094
834
539,304
790
540,928
540,094
Following the capital reconstruction in 2008 all employees’ share-based incentives were transferred to the new holding company,
Rightmove plc. In addition certain directors’ contracts of employment were transferred from Rightmove Group Limited to Rightmove plc,
whilst all other employees remained employed by Rightmove Group Limited. Accordingly the share-based payments charge has been split
between the Company and Rightmove Group Limited with £834,000 (2011: £790,000) being recognised in the Company accounts as a
capital contribution to its subsidiary.
17 Trade and other receivables
Group
Trade receivables
Less provision for impairment of trade receivables
Net trade receivables
Amounts held in Escrow (refer Note 11)
Prepayments and accrued income
Interest receivable
Other debtors
Non-current
Current
31 December 2012 31 December 2011
£000
£000
16,484
(447)
16,037
1,674
2,325
50
64
13,561
(429)
13,132
1,667
1,683
58
117
20,150
16,657
1,674
18,476
1,667
14,990
20,150
16,657
Exposure to credit and currency risks and impairment losses relating to trade and other receivables are disclosed in Note 29.
The Company has no trade and other receivables in either year.
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18 Cash and cash equivalents
Group
Bank accounts
31 December 2012 31 December 2011
£000
£000
7,082
21,768
Cash balances were placed on deposit for various lengths between one day and three months during the year and attracted interest at a
weighted average rate of 0.7% (2011: 0.6%).
The Company had no cash and cash equivalent balances in either year.
19 Trade and other payables
Group
Company
31 December 2012 31 December 2011 31 December 2012 31 December 2011
£000
£000
£000
£000
Trade payables
Trade accruals
Other creditors
Other taxation and social security
Deferred revenue
Accrued interest on inter-group payable balance
Inter-group payables
1,220
7,694
146
4,770
9,908
–
–
370
7,357
34
4,033
9,080
–
–
–
5,863
–
–
–
–
15,318
–
5,940
–
–
–
499
86,876
23,738
20,874
21,181
93,315
Exposure to currency and liquidity risk relating to trade and other payables is disclosed in Note 29.
The Company movement in trade payables during the year is reconciled as follows:
Trade payables at 1 January
Inter-group dividend settled via reduction in inter-group loan balance
Group relief settled via reduction in inter-group loan balance
Inter-group interest
Stamp duty on share buybacks accrued to equity
Movement in working capital in statement of cash flows
31 December 2012 31 December 2011
£000
£000
93,315
(160,197)
(3,128)
565
(15)
90,641
25,652
–
(4,132)
499
15
71,281
21,181
93,315
20 Loans and borrowings
The Group entered into a 12 month agreement with Barclays Bank Plc for a £10,000,000 uncommitted money market loan on
6 February 2013. To date no amount has been drawn under this facility.
The Company had no loans and borrowings in either year.
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0
1
2
71
Notes continued
21 Provisions
The Group booked a provision for lease dilapidations of £129,000 during the year (2011: £nil). The provision is based on an estimated cost
to make good per square foot multiplied by the floor area of each premise.
The Company had no provisions in either year.
22 Deferred tax assets
Deferred tax assets are attributable to the following:
Group
Share-based incentives
Property, plant and equipment
Provisions
Tax assets
Assets
31 December 2012 31 December 2011
£000
£000
9,347
227
93
10,402
199
83
9,667
10,684
The deferred tax asset of £9,667,000 at 31 December 2012 (2011: £10,684,000) is in respect of share-based incentives, depreciation in
excess of capital allowances and provisions.
The deferred tax asset relating to share-based incentives at 31 December 2012 is £9,347,000 (2011: £10,402,000). The decrease in the
deferred tax asset is due to the exercise of share-based incentives and a reduction in the future tax rate partly offset by an increase in the
Company’s share price from £12.44 at 31 December 2011 to £14.36 at 31 December 2012.
Company
Assets
31 December 2012 31 December 2011
£000
£000
Share-based incentives being tax assets
7,692
8,373
The deferred tax asset of £7,692,000 at 31 December 2012 (2011: £8,373,000) is in respect of share-based incentives. The decrease in the
deferred tax asset is due to the exercise of share-based incentives and a reduction in the future tax rate partly offset by an increase in the
Company’s share price from £12.44 at 31 December 2011 to £14.36 at 31 December 2012.
Movement in deferred tax during the year:
Group
Share-based incentives
Property, plant and equipment
Provisions
Company
1 January 2012
in income
directly in equity 31 December 2012
Recognised
Recognised
£000
10,402
199
83
£000
110
28
10
£000
(1,165)
–
–
£000
9,347
227
93
10,684
148
(1,165)
9,667
Recognised
Recognised
1 January 2012
in income
directly in equity 31 December 2012
£000
£000
£000
£000
Share-based incentives
8,373
88
(769)
7,692
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22 Deferred tax assets continued
The Autumn Statement on 5 December 2012 announced that the UK corporation tax rate will reduce to 21% by 2014. A reduction in the
rate from 26% to 25% (effective from 1 April 2012) was substantively enacted on 5 July 2011, and further reductions to 24% (effective from
1 April 2012) and 23% (effective from 1 April 2013) were substantively enacted on 26 March 2012 and 3 July 2012 respectively.
This will reduce the Group’s future current tax charge accordingly. The deferred tax asset at 31 December 2012 has been calculated based
on the rate of 23% substantively enacted at the balance sheet date. It has not been possible to quantify the full anticipated effect of the
announced further 2% rate reduction, although this will reduce further the Group’s future current tax charge and reduce the Group’s deferred
tax asset accordingly.
Movement in deferred tax during the prior year:
Group
Share-based incentives
Property, plant and equipment
Provisions
1 January 2011
in income
directly in equity 31 December 2011
Recognised
Recognised
£000
6,427
161
87
6,675
£000
6
38
(4)
40
£000
3,969
–
–
£000
10,402
199
83
3,969
10,684
The deferred tax asset arising on equity settled share-based incentives in both years was recognised in profit or loss to the extent that the
related equity settled share-based incentives charge was recognised in profit or loss.
Company
Recognised
Recognised
1 January 2011
in income
directly in equity 31 December 2011
£000
£000
£000
£000
Share-based incentives
5,142
329
2,902
8,373
23 Share capital
In issue
At 1 January
Purchase and cancellation of own shares
At 31 December
Authorised – par value £0.01 each
Ordinary shares
of £0.01 each
31 December 2012 31 December 2011
Number of shares
Number of shares
110,410,636
(4,514,521)
114,761,434
(4,350,798)
105,896,115
110,410,636
300,000,000
300,000,000
During 2012, 4,514,521 (2011: 4,350,798) ordinary shares were bought back by the Company and were subsequently cancelled. Further
details are disclosed in Note 24.
All issued shares are fully paid. The holders of ordinary shares are entitled to receive dividends as declared from time to time and are entitled
to one vote per ordinary share at general meetings of the Company.
Included within shares in issue at 31 December 2012 are 3,404,029 ordinary shares (2011: 4,527,783) held by the EBT and 2,505,430
(2011: 2,505,430) held in treasury.
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Notes continued
24 Reconciliation of movement in capital and reserves
Group
At 1 January 2011
Profit for the year
Share-based payments
Tax credit in respect of share-based
incentives recognised directly in equity
Dividends to shareholders
Exercise of share-based incentives
Cancellation of own shares
Share related expenses
Share
capital
£000
1,147
–
–
–
–
–
(43)
–
EBT
shares
reserve
£000
(13,937)
–
–
–
–
3,679
–
–
Treasury
shares
£000
(11,917)
–
–
–
–
–
–
–
Reverse
Other
acquisition
reserves
reserve
£000
147
–
–
–
–
–
43
–
£000
138
–
–
–
–
–
–
–
Retained
earnings
£000
52,286
46,505
2,269
7,271
(16,777)
2,469
(48,288)
(338)
Total
equity
£000
27,864
46,505
2,269
7,271
(16,777)
6,148
(48,288)
(338)
At 31 December 2011
1,104
(10,258)
(11,917)
190
138
45,397
24,654
At 1 January 2012
Profit for the year
Share-based payments
Tax credit in respect of share-based
incentives recognised directly in equity
Dividends to shareholders
Exercise of share-based incentives
Cancellation of own shares
Share related expenses
1,104
–
–
(10,258)
–
–
(11,917)
–
–
–
–
–
(45)
–
–
–
2,347
–
–
–
–
–
–
–
190
–
–
–
–
–
45
–
138
–
–
–
–
–
–
–
45,397
62,551
2,410
2,136
(20,439)
680
(66,359)
(467)
24,654
62,551
2,410
2,136
(20,439)
3,027
(66,359)
(467)
At 31 December 2012
1,059
(7,911)
(11,917)
235
138
25,909
7,513
Share buyback
In June 2007, the Company commenced a share buyback programme to purchase its own ordinary shares. The total number of shares
bought back in 2012 was 4,514,521 (2011: 4,350,798) representing 4.2% (2011: 3.9%) of the ordinary shares in issue (excluding shares
held in treasury). All of the shares bought back in both years were cancelled. The shares were acquired on the open market at a total
consideration (excluding costs) of £66,359,000 (2011: £48,288,000). The maximum and minimum prices paid were £16.00 (2011: £13.58)
and £12.65 (2011: £9.04) per share respectively.
EBT shares reserve
This reserve represents the carrying value of own shares held by the EBT. During the current and prior year the EBT purchased no shares.
1,123,754 (2011: 1,794,546) share-based incentives were exercised by Group employees during the year at an average price of £2.69
(2011: £3.43) per ordinary share, which were satisfied by shares held in the EBT. At 31 December 2012 the EBT held 3,404,029
(2011: 4,527,783) ordinary shares in the Company of £0.01 each, representing 3.2% (2011: 4.2%) of the ordinary shares in issue (excluding
shares held in treasury). The market value of the shares held in the EBT at 31 December 2012 was £48,882,000 (2011: £56,326,000).
Treasury shares
This represents the cost of acquiring 2,505,430 shares held in treasury. These shares were bought back in 2008 at an average price of
£4.76 and may be used to satisfy certain share-based incentive awards.
Other reserves
This represents the cumulative value of own shares bought back and cancelled. The movement of £45,000 (2011: £43,000) is the nominal
value of ordinary shares cancelled during the year.
Retained earnings
The gain on the exercise of share-based incentives is the difference between the value that the shares held by the EBT were originally
acquired at and the price at which share-based incentives were exercised during the year.
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24 Reconciliation of movement in capital and reserves continued
Company
At 1 January 2011
Loss for the year
Dividends to shareholders
Share-based payments
Tax credit in respect of share-based
incentives recognised directly in equity
Capital contribution
Cancellation of own shares
Share related expenses
Share
capital
£000
1,147
–
–
–
–
–
(43)
–
Treasury
shares
£000
(11,917)
–
–
–
Reverse
Other
acquisition
reserves
£000
reserve
£000
2,441
–
–
–
103,520
–
–
–
–
–
–
–
–
790
43
–
–
–
–
–
Retained
earnings
£000
423,603
(5,991)
(16,777)
1,479
5,483
–
(48,288)
(338)
Total
equity
£000
518,794
(5,991)
(16,777)
1,479
5,483
790
(48,288)
(338)
At 31 December 2011
1,104
(11,917)
3,274
103,520
359,171
455,152
At 1 January 2012
Profit for the year
Dividends to shareholders
Share-based payments
Tax credit in respect of share-based
incentives recognised directly in equity
Capital contribution
Cancellation of own shares
Share related expenses
1,104
–
–
–
(11,917)
–
–
–
3,274
–
–
–
103,520
–
–
–
–
–
(45)
–
–
–
–
–
–
834
45
–
–
–
–
–
359,171
155,761
(20,439)
1,576
1,381
–
(66,359)
(467)
455,152
155,761
(20,439)
1,576
1,381
834
(66,359)
(467)
At 31 December 2012
1,059
(11,917)
4,153
103,520
430,624
527,439
Treasury shares
This represents the cost of acquiring 2,505,430 shares held in treasury. These shares were bought back in 2008 at an average price of
£4.76 and may be used to satisfy certain share-based incentive awards.
Reverse acquisition reserve
This reserve resulted from the acquisition of Rightmove Group Limited by the Company and represents the difference between the value of
the shares acquired at 28 January 2008 and the nominal value of the shares issued.
Other reserves
Awards relating to share-based incentives made to Rightmove Group Limited employees have been treated as a deemed capital
contribution. The principal movement in other reserves for the year comprises £834,000 (2011: £790,000) in respect of the share-based
incentives charge for employees of Rightmove Group Limited. In addition a movement of £45,000 (2011: £43,000) has been recorded in
relation to the nominal value of ordinary shares cancelled during the year.
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2
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Notes continued
25 Share-based payments
The Group and Company operate share-based incentive schemes for executive directors and other selected senior management employees.
Since flotation, the Company has awarded share options under the Rightmove Unapproved Executive Share Option Plan (Unapproved Plan)
and the Rightmove Approved Executive Share Option Plan (Approved Plan). The Group also operates a Savings Related Share Option Scheme
(Sharesave Plan), a Deferred Share Bonus Plan (DSP) and in May 2011 the Rightmove Performance Share Plan (PSP) was introduced.
All share-based incentives are subject to a service condition. Such conditions are not taken into account in the fair value of the service
received. The fair value of services received in return for share-based incentives is measured by reference to the fair value of share-based
incentives granted. The estimate of the fair value of the share-based incentives is measured using either the Monte Carlo or Black Scholes
pricing model as is most appropriate for each scheme.
The total share-based payments charge for the year relating to all share-based incentive plans was £2,410,000 (2011: £2,269,000).
The Company charge for the year was £1,576,000 (2011: £1,479,000).
NI is being accrued, where applicable, at a rate of 13.8%, which management expects to be the prevailing rate when the awards are
exercised, based on the share price at the reporting date. The total NI charge for the year ended 31 December 2012 relating to all awards
is £2,041,000 (2011: £4,426,000).
The total Company NI charge for the year was £1,248,000 (2011: £4,034,000).
Approved and Unapproved Plans
There has been no award of share options since 5 March 2010.
Unapproved executive share option awards granted on 5 March 2010 at an exercise price of £6.66 are subject to an equal measure of
Total Shareholder Return (TSR) performance and growth in EPS. The vesting of 50% of the 2010 award will be dependent on a relative
TSR performance condition measured over a three-year performance period and the vesting of the other 50% of the 2010 award will be
dependent on the satisfaction of an EPS growth target over a three-year performance period.
Unapproved executive share option awards made on 5 March 2009, which vested on 5 March 2012, were subject to a relative TSR
performance over a three-year performance period, relative to the constituents of the FTSE 250.
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25 Share-based payments continued
The assumptions used in the measurement of the fair values at grant date of the Approved and Unapproved Plans are as follows:
Share price
Exercise
Expected
Risk free
Dividend
non-vesting
Fair value
Employee
turnover
before vesting/
yield
(%)
condition
per option
(%)
(pence)
Grant date
at grant date
(pence)
price
(pence)
volatility
Option life
(%)
(years)
14 March 2006 (Approved)
15 March 2006 (Unapproved)
15 March 2006 (Unapproved)
12 October 2006 (Unapproved)
6 September 2007 (Approved)
6 September 2007 (Unapproved)
10 October 2007
413.50
413.75
413.75
348.00
613.00
613.00
410.00
335.00
335.00
347.00
597.00
597.00
(Unapproved EPS dependent)(1)
525.00
522.00
5 March 2009
(Unapproved TSR dependent)(1)
226.75
224.00
5 March 2010
(Unapproved TSR dependent)(1)
5 March 2010
677.00
666.00
(Unapproved EPS dependent)(1)
677.00
666.00
27.0
27.0
27.0
27.0
32.0
32.0
32.0
50.3
49.0
49.0
7.0
7.0
6.0
7.0
7.0
7.0
6.8
6.5
6.5
6.5
rate
(%)
4.5
4.5
4.5
4.5
5.8
5.8
5.8
2.6
3.2
3.2
4.0
4.0
3.0
4.0
2.0
2.0
2.0
4.4
1.5
1.5
(1) For details of TSR and EPS performance conditions refer to Part II of the Remuneration report on pages 38 to 44.
Expected volatility is estimated by considering historic average share price volatility at the grant date.
Group and Company
Outstanding at 1 January
Exercised
2012
Weighted average
exercise price
(pence)
Number
Number
4,343,545
(873,670)
349.78
317.83
6,095,430
(1,751,885)
16.0
0.0
16.0
16.0
17.0
17.0
92.00
116.00
130.00
76.00
228.00
181.00
17.0
189.00
12.0
69.00
12.0
267.00
12.0
312.00
2011
Weighted average
exercise price
(pence)
348.33
344.73
Outstanding at 31 December
3,469,875
357.83
4,343,545
349.78
Exercisable at 31 December
3,049,996
315.40
2,793,167
345.77
The weighted average market value per ordinary share for options exercised in 2012 was £15.90 (2011: £11.58).
The options outstanding at 31 December 2012 have an exercise price in the range of £2.24 to £6.66 (2011: £2.24 to £6.66) and a weighted
average contractual life of 4.5 years (2011: 5.4 years).
The share-based payments charge for approved and unapproved executive share options for the year ended 31 December 2012 is
£512,000 (2011: £1,088,000).
The Company charge for the year was £332,000 (2011: £688,000).
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25 Share-based payments continued
Sharesave Plan
The Group operates an Her Majesty’s Revenue and Customs Approved Sharesave Plan under which employees are granted an option to
purchase ordinary shares in the Company at up to 20% less than the market price at invitation, in three years’ time, dependent on their
entering into a contract to make monthly contributions into a savings account over the relevant period. These funds are used to fund the
option exercise. No performance criteria are applied to the exercise of Sharesave options. The assumptions used in the measurement of
the fair value at grant date of the Sharesave Plan are as follows:
Employee
turnover
before vesting/
Grant date
1 October 2009
5 October 2010
3 October 2011
1 October 2012
Share price
Exercise
Expected
Risk free
Dividend
non-vesting
Fair value
at grant date
(pence)
price
(pence)
volatility
Option life
(%)
(years)
545.00
745.50
1200.00
1577.00
425.00
553.00
988.00
1295.00
50.3
49.0
42.9
34.8
3.3
3.3
3.3
3.3
rate
(%)
3.5
2.3
2.8
0.5
yield
(%)
4.4
1.6
1.3
1.3
condition
per option
(%)
(pence)
25.0
25.0
25.0
25.0
199.00
318.00
446.00
562.00
Expected volatility is estimated by considering historic average share price volatility at the grant date.
The requirement that an employee has to save in order to purchase shares under the Sharesave Plan is a non-vesting condition. This feature
has been incorporated into the fair value at grant date by applying a discount to the valuation obtained from the Black Scholes pricing
model. The discount has been determined by estimating the probability that the employee will stop saving based on expected future trends
in the share price and past employee behaviour.
Group and Company
Outstanding at 1 January
Granted
Forfeited
Exercised
2012
Weighted average
exercise price
(pence)
Number
145,982
40,136
(8,190)
(59,699)
572.10
1295.00
703.15
420.92
2011
Weighted average
Number
176,523
30,142
(18,022)
(42,661)
exercise price
(pence)
409.92
988.00
429.83
255.00
Outstanding at 31 December
118,229
884.47
145,982
572.10
Exercisable at 31 December
16,994
425.00
1,431
255.00
The weighted average market value per ordinary share for Sharesave options exercised in 2012 was £15.82 (2011: £12.77).
The Sharesave options outstanding at 31 December 2012 have an exercise price in the range of £4.25 to £12.95
(2011: £2.55 to £9.88) and a weighted average contractual life of 1.8 years (2011: 1.7 years).
The share-based payments charge for Sharesave options for the year ended 31 December 2012 is £129,000 (2011: £106,000).
The Company charge for the year was £4,000 (2011: £5,000).
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25 Share-based payments continued
Performance Share Plan (PSP)
The PSP permits awards of nil cost options or contingent shares which will only vest in the event of prior satisfaction of a
performance condition.
156,685 PSP awards were made to executive directors and other selected senior management on 2 March 2012 (the Grant date) subject
to EPS and relative TSR performance. Performance will be measured over three financial years (1 January 2012 – 31 December 2014). The
vesting in March 2015 (Vesting date) of 25% of the 2012 PSP awards will be dependent on a relative TSR performance condition measured
over a three-year performance period and the vesting of 75% of the 2012 PSP awards will be dependent on the satisfaction of an EPS growth
target measured over a three-year performance period. PSP award holders are entitled to receive dividends accruing between the Grant date
and Vesting date, and this value will be delivered in shares.
The PSP awards have been valued using the Monte Carlo model for the TSR element and the Black Scholes model for the EPS element and
the resulting share-based payments charge is being spread evenly over the period between the Grant date and the Vesting date.
Grant date
Share price
Exercise
at Grant date
(pence)
price
(pence)
4 May 2011 (TSR dependent)(1)
1039.00
4 May 2011 (EPS dependent)(1)
1039.00
2 March 2012 (TSR dependent)(1) 1391.00
2 March 2012 (EPS dependent)(1) 1391.00
nil
nil
nil
nil
Expected
volatility
(%)
42.9
n/a
34.8
n/a
Option
life
(years)
2.8
2.8
3.0
3.0
Risk free
Dividend
non-vesting
Fair value
rate
(%)
1.4
1.4
0.5
0.5
yield
(%)
0.0
0.0
0.0
0.0
condition
per option
(%)
(pence)
3.1
3.1
3.7
3.7
739.00
1039.00
708.00
1391.00
(1) For details of TSR and EPS performance conditions refer to Part II of the Remuneration report on pages 38 to 44.
Employee
turnover
before vesting/
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Group and Company
Outstanding at 1 January
Granted
Forfeited
Outstanding at 31 December
Exercisable at 31 December
2012
Weighted average
exercise price
(pence)
Number
164,258
156,685
(32,519)
288,424
–
–
–
–
–
–
2011
Weighted average
Number
–
164,258
–
164,258
–
exercise price
(pence)
–
–
–
–
–
Expected volatility is estimated by considering historic average share price volatility at the Grant date.
The share-based payments charge for the year ended 31 December 2012 is £948,000 (2011: £361,000).
The Company charge for the year was £685,000 (2011: £277,000).
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Notes continued
25 Share-based payments continued
Deferred Share Bonus Plan (DSP)
In March 2009 a DSP was established which allows executive directors and other selected senior management the opportunity to earn
a bonus determined as a percentage of base salary settled in deferred shares. The award of shares under the plan is contingent on the
satisfaction of pre-set internal targets relating to underlying drivers of long-term revenue growth (the Performance period). The right to the
shares is deferred for two years from the date of the award (the Vesting period) and potentially forfeitable during that period should the
employee leave employment. The deferred share awards have been valued using the Black Scholes model and the resulting share-based
payments charge is being spread evenly over the combined Performance period and Vesting period of the shares, being three years.
The assumptions used in the measurement of the fair value of the deferred share awards are calculated at the date on which the potential
DSP bonus is communicated to senior management (the Grant date) as follows:
Employee
turnover
before vesting/
Grant date
5 March 2009
5 March 2010
4 March 2011
2 March 2012
Share price
Exercise
Expected
Risk free
Dividend
non-vesting
at Grant date
Award date
(pence)
price
(pence)
term
(years)
5 March 2010
4 March 2011
2 March 2012(1)
–(2)
226.75
677.00
1039.00
1391.00
nil
nil
nil
nil
3.0
3.0
2.8
3.0
rate
(%)
2.6
3.2
1.4
0.5
yield
(%)
condition
(%)
4.4
1.5
1.4
1.3
12.0
12.0
3.4
4.1
Fair value
per share
(pence)
199.00
648.00
1000.00
1338.00
(1) Following the achievement of the 2011 internal performance targets, 76,048 nil cost option deferred shares were awarded to executives
and senior management on 2 March 2012 (the Award date) with the right to the release of the shares deferred until March 2014.
(2) Based on the 2012 internal performance targets the Remuneration Committee determined that 90% of the maximum award in respect
of the year will be made in March 2013. The number of shares to be awarded will be determined based on the share price at the Award date
in March 2013.
Group and Company
Outstanding at 1 January
Awarded
Forfeited
Exercised
Outstanding at 31 December
Exercisable at 31 December
2012
Weighted average
exercise price
(pence)
Number
331,989
76,048
–
(190,385)
217,652
25,573
–
–
–
–
–
–
2011
Weighted average
Number
215,958
118,467
(2,436)
–
331,989
–
exercise price
(pence)
–
–
–
–
–
–
The weighted average market value per ordinary share for deferred shares exercised in 2012 was £15.44 (2011: £nil).
The DSP awards have a weighted average contractual life of 0.9 years (2011: 1.0 years).
The share-based payments charge for the year ended 31 December 2012 is £821,000 (2011: £714,000).
The Company charge for the year was £555,000 (2011: £509,000).
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26 Operating lease commitments
Non-cancellable operating lease rentals are payable as follows:
31 December 2012
31 December 2011
Plant & machinery
Land & buildings
Plant & machinery
Land & buildings
Group
Less than one year
Between one and five years
More than five years
£000
408
231
–
639
£000
949
3,338
1,175
Total
£000
1,357
3,569
1,175
£000
687
2,624
199
Total
£000
1,061
3,079
199
5,462
6,101
3,510
4,339
£000
374
455
–
829
The Company has no operating lease commitments in either year.
27 Capital commitments
As at 31 December 2012 the Group had no significant capital expenditure commitments (2011: £nil).
The Company has no capital commitments in either year.
28 Related party disclosures
Inter-group transactions with subsidiaries
During the year the Company was charged interest of £565,000 (2011: £499,000) by Rightmove Group Limited in respect of balances
owing under the inter-group loan agreement dated 30 January 2008.
As at 31 December 2012 the balance owing under this agreement was £15,318,000 (2011: £87,375,000) including capitalised interest.
On 21 March 2012 Rightmove Group Limited declared an interim dividend of 61.8p per ordinary share to the Company. The dividend of
£79,969,000 was settled via a reduction in the inter-group loan balance.
On 11 December 2012 Rightmove Group Limited declared a further interim dividend of 62.0p per ordinary share to the Company.
The dividend of £80,228,000 was settled via a reduction in the inter-group loan balance.
Directors’ transactions
There were no transactions with directors in either year other than those disclosed in the Remuneration report. Information on the
emoluments of the directors, who served during the year, together with information regarding the beneficial interest of the directors in
the ordinary shares of the Company is included in the Remuneration report on pages 30 to 44.
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Notes continued
29 Financial instruments
Credit risk
The carrying amount of financial assets represents the maximum credit exposure. The maximum exposure to credit risk at the reporting
date was:
Net trade receivables
Amounts held in Escrow
Accrued interest receivable
Other debtors
Cash and cash equivalents
Note
17
11,17
17
17
18
Group
31 December 2012 31 December 2011
£000
£000
16,037
1,674
50
64
7,082
13,132
1,667
58
117
21,768
24,907
36,742
The Company had no exposure to credit risk in either year.
The maximum exposure to credit risk for trade receivables at the reporting date by geographic region was:
Group
UK
Rest of the world
Note
17
31 December 2012 31 December 2011
£000
£000
15,954
83
13,086
46
16,037
13,132
The maximum exposure to credit risk for trade receivables at the reporting date by type of customer was:
Group
Property advertisers
Other
Note
17
31 December 2012 31 December 2011
£000
£000
14,956
1,081
12,676
456
16,037
13,132
The Group’s most significant customer, an Estate Agent, accounts for £968,000 (2011: £1,011,000) of the trade receivables carrying amount.
Impairment losses
The ageing of trade receivables at the reporting date was:
Group
Not past due
Past due 0 – 30 days
Past due 30 – 60 days
Past due 60 – 90 days
Past due older
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31 December 2012
31 December 2011
Gross
£000
10,140
3,357
2,522
263
202
Impairment
£000
(15)
(236)
(124)
(38)
(34)
Gross
£000
9,662
2,405
1,311
129
54
16,484
(447)
13,561
Impairment
£000
(35)
(247)
(109)
(31)
(7)
(429)
29 Financial instruments continued
The movement in the allowance for impairment in respect of trade receivables during the year was as follows:
Group
At 1 January
Charged during the year
Utilised during the year
At 31 December
31 December 2012 31 December 2011
£000
£000
429
198
(180)
447
371
315
(257)
429
The Group has identified specific balances for which it has provided an impairment allowance on a line by line basis across all ledgers, in
both years. No general impairment allowance has been provided in either year.
The allowance accounts in respect of trade receivables are used to record impairment losses unless the Group is satisfied that no recovery
of the amount owing is possible; at that point the amounts considered irrecoverable are written off against the financial asset directly.
Liquidity risk
The following are the contractual maturities of undiscounted financial liabilities, including undiscounted estimated interest payments:
Group
At 31 December 2012
Trade payables being non-derivative financial liabilities
Group
At 31 December 2011
Trade payables being non-derivative financial liabilities
The Company had no non-derivative financial liabilities in either year.
Carrying
amount
£000
Contractual
cash flows
£000
6 months
or less
£000
1,220
(1,220)
(1,220)
Carrying
amount
£000
Contractual
cash flows
£000
6 months
or less
£000
370
(370)
(370)
It is not expected that the cash flows included in the maturity analysis could occur earlier or at significantly different amounts and all payables
are due within six months of the balance sheet date.
Currency risk
During 2012 all the Group’s sales and more than 95.0% of the Group’s purchases were Sterling denominated and accordingly it has no
significant currency risk.
Interest rate risk
The Group and the Company have exposure to interest rate risk on their cash balances and amounts held in Escrow. As at
31 December 2012 the Group had total cash of £7,082,000 (2011: £21,768,000) and £1,674,000 (2011: £1,667,000) held in Escrow.
Fair values
The fair values of all financial instruments in both years are equal to the carrying values.
30 Contingent liabilities
The Group and the Company had no contingent liabilities in either year.
31 Subsequent events
There have been no subsequent events having a material impact on the financial statements between 31 December 2012 and the reporting date.
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Advisers and shareholder information
Contacts
Chief Executive Officer:
Chief Operating Officer
and Finance Director:
Company Secretary:
Website:
Ed Williams
Nick McKittrick
Robyn Perriss
www.rightmove.co.uk
Registered office
Rightmove plc
Turnberry House
30 Caldecotte Lake Drive
Milton Keynes
MK7 8LE
Registered in
England no. 6426485
Financial calendar 2013
2012 full year results
Annual General Meeting
Final dividend record date
Final dividend payment
Interim Management Statement May, November 2013
Half year results
Interim dividend
1 March 2013
8 May 2013
10 May 2013
7 June 2013
31 July 2013
November 2013
Corporate advisers
Financial adviser
UBS Investment Bank
Joint brokers
UBS Limited
Numis Securities Limited
Auditor
KPMG Audit Plc
Bankers
Barclays Bank Plc
HSBC Bank Plc
Santander UK Plc
Solicitors
Slaughter and May
Pinsent Masons
Registrar
Capita Registrars*
*Shareholder enquiries
The Company’s registrar is Capita Registrars. They will be pleased to
deal with any questions regarding your shareholding or dividends.
Please notify them of your change of address or other personal information.
Their address details are:
Capita Registrars
The Registry
34 Beckenham Road
Beckenham
Kent
BR3 4TU
Capita Registrars is a trading name of Capita Registrars Limited.
Capita shareholder helpline: 0871 664 0300
(calls cost 10p per minute plus network extras)
(Overseas: +44 20 8639 3399)
Email: ssd@capitaregistrars.com
Share portal: www.capitashareportal.com
Through the website of our registrar, Capita Registrars, shareholders
are able to manage their shareholding online and facilities include
electronic communications, account enquiries, amendment of address
and dividend mandate instructions.
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Rightmove plc Turnberry House, 30 Caldecotte Lake Drive,
Caldecotte, Milton Keynes, MK7 8LE
Registered in England no 6426485
Millions of home hunters use Rightmove on the move.
iPhone app | iPad app | Android app | Mobile site
Winner of three
categories in Britain’s
Most Admired
Companies 2012