Financial highlights

Revenue
+7.1%

at constant exchange rates

Adjusted operating profit*
+2.8%

at constant exchange rates

Adjusted earnings per share*
+4.9%

at constant exchange rates

Dividend per share
+5.4%

For the year ended 31 December 2021. *Alternative performance measure

Financial results 2021 2020 Growth as reported Growth at constant exchange rateΔ
Revenue £10,285.1m £10,111.1m 1.7% 7.1%
Adjusted operating profit* £752.8m £778.4m (3.3)% 2.8%
Adjusted profit before income tax* £698.2m £715.6m (2.4)% 3.9%
Adjusted earnings per share* 162.5p 164.9p (1.5)% 4.9%
Dividend per shareΔ 57.0p 54.1p 5.4%  
         
Statutory results        
Operating profit £623.3m £618.5m 0.8%  
Profit before income tax £568.7m £555.7m 2.3%  
Basic earnings per share 132.7p 128.8p 3.0%  

 

Highlights include:

  • Strong revenue growth of 7.1% at constant exchange rates, with recovery in the base business and acquisitions more than offsetting expected declines in Covid-19 related sales; revenue at constant exchange rates 17.1% higher than in 2019
  • Adjusted operating profit* increase of 2.8% at constant exchange rates and a rise in adjusted earnings per share* of 4.9%; reported operating profit up 0.8% and reported basic earnings per share up 3.0%
  • Continued strong cash generation with cash conversion* of 102%, and net debt to EBITDA† of 1.6 times with substantial headroom for acquisition growth
  • Total 2021 dividend per share growth of 5.4%; 29th consecutive year of dividend growth
  • 14 acquisitions announced in 2021 with committed spend of £508 million; c.£950 million of committed acquisition spend over 2020 and 2021 combined; active pipeline

*Alternative performance measure

Consolidated income statement

For the year ended 31 December 2021

  2021
£m
2020
£m
Actual exchange Constant exchange
Revenue 10,285.1 10,111.1 1.7% 7.1%
Adjusted operating profit 752.8 778.4 (3.3)% 2.8%
Finance income 10.7 10.4    
Finance expense (65.3) (73.2)    
Adjusted profit before income tax 698.2 715.6 (2.4)% 3.9%
Tax on adjusted profit (155.7) (165.1)    
Adjusted profit for the year 542.5 550.5 (1.5)% 4.9%
         
Adjusted earnings per share 162.5p 164.9p (1.5)% 4.9%
         
Adjusted operating profit 752.8 778.4 (3.3)% 2.8%
Adjusted for:        
Customer relationships and brands amortisation (106.5) (100.4)    
Acquisition related items (23.0) (42.7)    
Non-recurring pension scheme charges - (16.8)    
Operating profit 623.3 618.5 0.8%  
Finance income 10.7 10.4    
Finance expense (65.3) (73.2)    
Profit before income tax 568.7 555.7 2.3%  
Income tax (125.9) (125.7)    
Profit for the year attributable to the Company's equity holders 442.8 430.0 3.0%  
         
Earnings per share attributable to the Company's equity holders        
Basic 132.7p 128.8p 3.0% 10.5%
Diluted 131.8p 128.3p    

See Note 3 on page 168 of the 2021 Annual Report for further details of the alternative performance measures.

Consolidated balance sheet

At 31 December 2021

  2021
£m
2020
£m
Assets    
Property, plant and equipment 120.9 122.7
Right-of-use assets 448.3 453.4
Intangible assets 2,766.8 2,441.9
Defined benefit pension assets 63.6 0.4
Derivative financial assets 6.9 17.0
Deferred tax assets 2.8 2.5
Total non-current assets 3,409.3 3,037.9
     
Inventories 1,474.0 1,432.2
Trade and other receivables 1,431.0 1,395.8
Income tax receivable 8.0 6.6
Derivative financial assets 14.9 12.6
Cash at bank and in hand 776.9 944.3
Total current assets 3,704.8 3,791.5
Total assets 7,114.1 6,829.4
     
Equity    
Share capital 108.4 108.3
Share premium 194.2 187.7
Translation reserve (269.2) (190.9)
Other reserves 19.0 14.3
Retained earnings 2,151.5 1,799.7
Total equity attributable to the Company’s equity holders 2,203.9 1,919.1
     
Liabilities    
Interest bearing loans and borrowings 1,433,7 1,615.2
Defined benefit pension liabilities 32.4 45.2
Other payables 72.9 50.2
Income tax payable 1.5 2.0
Provisions 56.3 55.7
Lease liabilities 359.6 368.4
Derivative financial liabilities 27.9 0.8
Deferred tax liabilities 151.0 105.1
Total non-current liabilities 2,135.3 2,242.6
     
Bank overdrafts 551.6 514.6
Interest bearing loans and borrowings 111.9 79.9
Trade and other payables 1,921.3 1,836.3
Income tax payable 42.1 75.7
Provisions 8.5 8.5
Lease liabilities 129.1 129.1
Derivative financial liabilities 10.4 23.6
Total current liabilities 2,774.9 2,667.7
Total liabilities 4,910.2 4,910.3
Total equity and liabilities 7,114.1 6,829.4

 

Consolidated cash flow statement

For the year ended 31 December 2021

  2021
£m
2020
£m
Cash flow from operating activities
Profit before income tax 568.7 555.7
Adjusted for:
Net finance expense 54.6 62.8
Customer relationships and brands amortisation 106.5 100.4
Acquisition related items 23.0 42.7
Non-recurring pension scheme charges - 16.8
Adjusted operating profit 752.8 778.4
Adjustments:
Depreciation and software amortisation 171.2 171.7
Other non-cash items 4.4 13.2
Working capital movement 2.1 5.0
Cash generated from operations before acquisition related items 930.5 968.3
Cash outflow from acquisition related items (16.0) (24.3)
Income tax paid (181.4) (153.8)
Cash inflow from operating activities 733.1 790.2
 
Cash flow from investing activities
Interest received 8.7 15.1
Purchase of property, plant and equipment and software (32.7) (33.1)
Sale of property, plant and equipment 2.7 1.2
Purchase of businesses (436.7) (363.2)
Cash outflow from investing activities (458.0) (380.0)
 
Cash flow from financing activities
Interest paid excluding interest on lease liabilities (43.5) (56.6)
Dividends paid (180.4) (171.5)
Increase in borrowings 14.5 444.5
Repayment of borrowings (134.9) (133.5)
Realised (losses)/gains on foreign exchange contracts 25.0 (37.1)
Payment of lease liabilities – principal (138.6) (137.1)
Payment of lease liabilities – interest (20.3) (22.5)
Proceeds from issue of ordinary shares to settle share options 6.6 3.7
Proceeds from exercise of market purchase share options 47.1 37.0
Purchase of employee trust shares (34.2) (49.1)
Cash outflow from financing activities (458.7) (122.2)
     
(Decrease)/increase in cash and cash equivalents (183.6) 288.0
     
Cash and cash equivalents at start of year 429.7 140.8
(Decrease)/increase in cash and cash equivalents (183.6) 288.0
Currency translation (20.8) 0.9
Cash and cash equivalents at end of year 225.3 429.7

 

Alternative performance measures

2021
£m

2020
£m

Cash generated from operations before acquisition related items 930.5 968.3
Purchase of property, plant and equipment and software (32.7) (33.1)
Sale of property, plant and equipment 2.7 1.2
Payment of lease liabilities (158.9) (159.6)
Operating cash flow 741.6 776.8
     
Adjusted operating profit 752.8 778.4
Add back depreciation of right-of-use assets 134.8 134.8
Deduct payment of lease liabilities (158.9) (159.6)
Lease adjusted operating profit 728.7 753.6
     
Cash conversion (operating cash flow as a percentage of lease adjusted operating profit) 102% 103%
     
Operating cash flow 741.6 776.8
Net interest excluding interest on lease liabilities
(34.8) (41.5)
Income tax paid (181.4) (153.8)
Free cash flow 525.4 581.5

See Note 3 on page 168 of the 2021 Annual Report.

Five year review

  IFRS IAS 17
  2021
£m
2020
£m
2019
£m
2019Δ
£m
2018
£m
2017
£m
Revenue 10,285.1 10,111.1​ 9,326.7 9,326.7 9,079.4 8,580.9
Operating profit 623.3 618.5​ 528.4 506.0 466.2 456.0
Finance income 10.7 10.4​ 12.4 12.4 11.6 10.6
Finance expense (65.3)​ (73.2)​ (87.5) (64.2) (66.6) (57.3)
Profit on disposal of businesses 13.6
Profit before income tax 568.7 555.7​ 453.3 454.2 424.8 409.3
Income tax (125.9)​ (125.7)​ (104.1) (104.3) (98.3) (98.8)
Profit for the year attributable to the Company's equity holders 442.8 430.0​ 349.2 349.9 326.5 310.5
Basic earnings per share 132.7p​ 128.8p​ 104.8p 105.0p 98.4p 94.2p

 

 

Alternative performance measures            
Adjusted operating profit 752.8 778.4​ 653.3 630.9 614.0 589.3
Adjusted profit before income tax 698.2 715.6​ 578.2 579.1 559.0 542.6
Adjusted profit for the year 542.5 550.5​ 440.6 441.3 429.9 393.4
Adjusted earnings per share 162.5p 164.9p​ 132.2p 132.4p 129.6p 119.4p

 

† Alternative performance measure

Δ Following the adoption of IFRS 16 ‘Leases’ with effect from 1 January 2019, because the Group adopted the accounting standard using the modified retrospective approach to transition and accordingly did not restate prior periods, the results for the years ending 31 December 2019 and onwards are not directly comparable with those reported in the prior years under the previous applicable accounting standard, IAS 17 ‘Leases’. To provide a meaningful comparative for the year ended 31 December 2019, the results for 2019 have been presented under both IAS 17 and IFRS 16 accounting standards.