Peachtree 2015 Annual Report Download - page 48

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Financial and operating review continued
Taxation
The statutory income tax expense was £82m (FY14: £90m). The effective
tax rate on statutory profit before tax was 30% (FY14: 32%). The effective
tax rate on underlying profit before tax was 25% (FY14: 27%). The
reduction is driven by a general reduction in tax rates including the
UK tax rate, as well as a number of one off items arising as a result of
corporate simplifications and prior year items.
Revenue
Statutory Organic
FY15 FY14 Change FY15 FY14 Change
Europe £753m £748m +0.7% £745m £708m +5.3%
North America £477m £409m +16.6% £450m £433m +3.9%
International £206m £197m +4.4% £206m £181m +13.6%
Group £1,436m £1,354m +6.1% £1,400m £1,321m +6.0%
Operating profit
Statutory Organic
FY15 FY14 Change FY15 FY14 Change
Group £297m £300m –0.8% £380m £350m +8.3%
Margin 20.7% 22.1% –140bps 27.1% 26.5% +60bps
Revenue mix
Recurring revenue Processing revenue SSRS revenue
Organic FY15 FY14 Change FY15 FY14 Change FY15 FY14 Change
Europe £560m £519m +7.8% £32m £30m +9.0% £153m £159m –3.6%
North America £260m £238m +9.0% £120m £122m –1.0% £69m £73m –4.9%
International £133m £117m +13.7% £8m £7m +18.1% £64m £57m +12.7%
Group £953m £874m +9.0% £161m £158m +1.7% £287m £289m –0.7%
% of total organic revenue 68% 66% 11% 12% 20% 22%
Organic to statutory reconciliations
FY15 FY14
Revenue Operating profit Margin Revenue Operating profit Margin
Organic £1,400m £380m 27.1% £1,321m £350m 26.5%
Organic adjustments1£36m –£1m –
Underlying £1,436m £380m 26.5% £1,322m £350m 26.5%
Impact of foreign exchange2– – £32m £11m
Underlying (as reported) £1,436m £380m 26.5% £1,354m £361m 26.5%
Recurring items3–(£21m) –(£16m)
Non–recurring items4–(£62m) –(£45m)
Statutory £1,436m £297m 20.7% £1,354m £300m 22.1%
1 Organic adjustments comprise contributions from acquisitions, disposals and products held for sale.
2 Impact of retranslating FY14 results at FY15 average rates.
3 Recurring items comprise amortisation of acquired intangible assets, acquisition–related items and fair value adjustments.
4 Non-recurring items comprise items that management judge to be one-off or non–operational.
The income tax charge and the total tax paid in the year are underpinned
by Sage’s tax policy, which is aligned with the overall goals of the business
including Sage’s vision, strategy, code of ethics and guiding values. We
seek to manage our tax affairs in a responsible and transparent manner,
to comply with relevant legislation and with due regard to our reputation.
Our approach is in line with the principles issued by the Confederation
of British Industry (CBI). Sage’s tax policy has been agreed by the Board,
with progress being monitored by the Group Audit and Risk Commiee.
The policy has been shared with the UK tax authorities.
The Sage Group plc | Annual Report & Accounts 2015
46