19 Jun 2009 17:04
Yell Group plc ("Yell")
Annual Report and Accounts 2009Notice of 2009 Annual General Meeting and Proxy Card
The above documents were posted to shareholders on 19 June 2009. Copies of the above documents have been submitted to the Financial Services Authority and will shortly be available for inspection at the UK Listing Authority's Document Viewing Facility which is situated at:
The Financial Services Authority
25 The North Colonnade
Canary Wharf
London
E14 5HS
Tel: 020 7066 1000
These documents (with the exception of the Proxy Card) are also available to view on Yell's website at:
http://www.yellgroup.com/annualreport
The unaudited condensed set of financial statements for the year ended 31 March 2009, were published on 20 May 2009. These were prepared in accordance with International Financial Reporting Standards as adopted by the European Union ("IFRSs") and in accordance with the Listing Rules of the Financial Services Authority.
Set out below in this announcement is additional information reproduced for the purposes of compliance with the Disclosure and Transparency Rules, including related party transactions, principal risks and uncertainties and a responsibility statement. This information is extracted from the audited Annual Report and Accounts for the year ended 31 March 2009, and therefore, page and note references relate to that document. This announcement should not be regarded as a substitute for reading the full Annual Report and Accounts.
ADDITIONAL INFORMATION
Related party transactions
Company
There were no transactions with Group companies in the years ended 31 March 2009 and 2008 other than the following transactions with Yell Finance B.V., ESOP trust and SIP trust:
Year ended 31 March
| £ millions | 2009 | 2008 |
| Finance income from Yell Finance B.V. | 34.8 | 40.4 |
| Net finance income | 34.8 | 40.4 |
Year ended 31 March
| £ millions | 2009 | 2008 |
| Amounts charged by ESOP trust for employee share plans | 29.8 | 15.8 |
At 31 March
| £ millions | 2009 | 2008 |
| Non-current assets | ||
| Amounts owed by Yell Finance B.V. | 641.1 | 632.5 |
| Amounts owed by ESOP trust, net of £22.2 million provisions (2008 - £nil) | 9.5 | 32.2 |
| Amounts owed by SIP trust | 0.1 | - |
| Total amounts owed by Group companies | 650.7 | 664.7 |
Subsidiary undertakings
Brief details of principal subsidiary undertakings at 31 March 2009 and 2008, all of which are unlisted, are disclosed in note 15.
Key management compensation was as follows:
Year ended 31 March
| £ millions | 2009 | 2008 |
| Salaries and other short-term employee benefits | 6.5 | 4.3 |
| Post-employment benefits | 0.6 | 0.5 |
| Share-based payments | 5.4 | 2.9 |
| 12.5 | 7.7 |
Principal risks
In this section we set out how we manage potential risks and uncertainties that could have a material effect on the Group's long-term performance and could cause actual results to differ materially from historical results. We have quantified the risks arising from market fluctuations and our use of estimates under the heading 'Sensitivity analyses' at the end of this section.
Risk management
Our commentary regarding financial information in this business review should be read in conjunction with the audited financial statements. Readers are cautioned that forward-looking statements are not guarantees of future performance and involve risks and uncertainties. The discussion of estimated amounts generated from the sensitivity analyses is forward-looking and also involves risks and uncertainties. Caution should be exercised in relying on these analyses. Actual results may differ materially from those in forward-looking statements.
Risk management processes
We undertake various activities within a risk management framework to ensure that risk and uncertainty are properly managed and that appropriate internal controls are in place:
• The directors have overall responsibility for establishing and maintaining the systems of internal control and risk management, and for reviewing their effectiveness. These systems are designed to manage, rather than eliminate, the risk of failure to achieve business objectives. The systems also provide reasonable, but not absolute, assurance against material misstatement or loss.
• We carry out an annual detailed risk assessment to identify the nature and extent of key operational and financial risks facing the Group. We consider the likelihood of these risks materialising and we ensure mitigation plans are in place where we believe they are appropriate. This process has been in place for the reporting periods covered by this report and up to the date of approval of this Annual Report.
• We have developed a risk-based internal audit plan to evaluate the overall provision of assurance provided by the processes managing each key risk.
• The Audit Committee and senior management regularly review the risk assessment and internal audit plan.
• We have voluntarily designed and implemented financial reporting controls in line with what we believe are best practices. We have fully documented the systems, processes and key controls that produce financial reporting. We update our documentation and test the identified key controls annually. This testing is in addition to, and runs parallel with, the internal audit plan and risk assessment programme.
• The Board, with advice from the Audit Committee, has completed its annual review of the effectiveness of the system of internal controls in accordance with the guidance of the Turnbull Report (updated October 2005), and is satisfied that it complies with that guidance.
• It is not possible to identify every risk that could affect our business, and the actions taken to mitigate identified risks cannot provide absolute assurance that a risk will not adversely affect our business or financial performance. The principal risks and uncertainties we have identified are outlined on the following pages.
Strategic risk factors
At present the majority of our revenue comes from printed classified directories. Increasingly, consumers are using a wider variety of channels to find local businesses, most notably the internet. Our aim is to deliver quality business leads to our advertisers. Therefore, we constantly monitor changes in technology and user preferences to ensure our channels remain the best place to search for local businesses. Accordingly, we continue to innovate and invest in line with these changing trends so as to improve all our channels and products. The success of this can be seen in the internet, where millions of users use our sites each day, and online revenue now accounts for 15% of the total Group. Looking forward, we expect usage behaviour to continue to change, with mobile becoming increasingly popular and we are actively improving our offering in that space.
The Group operates in competitive markets, competing for usage and advertiser spend against traditional print media, a host of internet search companies, most notably Google, and many other businesses such as internet search optimisation and marketing agencies. We meet this challenge by retaining a close relationship with our customers through our highly trained sales force and proving the excellent value of our products to our customers.
In the US we face particular competition from incumbent and independent directory publishers, all of whom are increasingly competing on price. We are addressing the competitive forces as rapidly as they arise in all our markets through our product design, technological innovations, promotional techniques, pricing propositions and our approach to sales; we intend in particular to manage and grow our online usage and revenue share.
In the slightly less-developed markets of Spain and Latin America our 'back to basics' approach has seen us continue to invest in usage, to rationalise our business activities, and to undertake a revitalisation of the sales force entailing a focus on new payment schemes and sales methods.
In all our markets we focus on the value we offer to advertisers relative to the value offered by competitors.
In the 2009 financial year, 21% of the Group's revenue (Yellow Pages revenue in the UK) was subject to regulation, compared to 25% during the 2008 financial year. This regulation reduced our ability to respond to competitive pressures by restricting our pricing flexibility. The price cap limited price increases to the prevailing rate of the UK retail price index (RPI). A review of the undertakings given by the Group to the UK's Competition Commission is planned in 2010. We will continue to present our case that regulation is not justified in this competitive market.
Operational risk factors
A significant part of our revenue comes from selling advertising to small and medium-sized enterprises. In these times of economic uncertainty and tight credit markets, many businesses can be expected to spend less money on advertising. We attempt to mitigate this effect by providing evidence of the value that the customer receives from advertising with us.
Small and medium-sized enterprises tend to have limited financial resources and experience higher failure rates than large businesses. It is a normal and necessary business practice for us to offer credit terms to these customers. We mitigate the risks of incurring bad debts and longer collection times through tailored credit vetting procedures. In new markets, we accept higher levels of customer churn and bad debts, because this is a necessary investment in establishing an initial presence. The diversity and size of our customer base mitigate material shifts in customer churn and increases in bad debt expense.
We rely on our sales force, which comprises 55% of our employees, to drive revenue growth in our competitive markets. We aim to recruit and retain high-quality people through our remuneration, training and development programmes.
We rely on our suppliers who work in partnership with us to deliver our products. We have long-standing relationships with most of our key suppliers, the most important of which are UPM-Kymmene Corporation, Quebecor World, RR Donnelley and Einsa Print International. Paper is our single largest raw material expense, but in the 2009 financial year paper costs were equivalent to only 6% of Group revenue. We limit our exposure to market fluctuations through contracts and pricing arrangements with these suppliers.
Our trademarks and intellectual property rights, such as our Yellow Pages and Yell.com brand names in the UK, Páginas Amarillas in Spain and our Yellowbook brand name in the US, are important to our business. We rely upon a combination of copyright and trademark laws, contractual arrangements and licensing agreements to establish and protect these rights. If necessary we will use all legal remedies available to protect our rights.
Debt and financing risk factors
The principal financing and treasury exposures faced by the Group arise from working capital management, the financing of acquisitions and property, plant and equipment, the management of interest rates on the Group's debt and the investment of surplus cash. The treasury function manages those exposures with the objective of remaining within ratios covenanted with the lenders of its bank debt. The Group purchases or sells derivative contracts for hedging purposes only (as referred to below) and does not use derivative contracts for trading or speculative purposes.
The Group's treasury function's primary role is to fund investments and to manage liquidity and financial risk, including risk from volatility in currency and interest rates and counterparty credit risk. The treasury function is not a profit centre and its objective is to manage risk at optimum cost.
The Board sets the treasury function's policy and its activities are subject to a set of controls relative to the size of the investments and borrowings under its management.
Counterparty credit risk is closely monitored and managed within controls set by the Board. Derivative financial instruments, including forward foreign exchange contracts, are normally used only for hedging purposes.
Yell Group has funded the business largely from cash flows generated from operations and bank debt in the form of term loans. We will require access to funding before April 2011 in order to refinance nearly half of our term loans, which mature at that time. Whilst we enjoy sound relationships with our lenders and are currently able to service our level of debt, there is a risk, given current world economic conditions that the debt markets will remain in their prevailing state, where the cost of debt is relatively high and access is either restricted or not possible at all.
Net debt at 31 March 2009 was 4.7 times annualised pro forma adjusted EBITDA at consistent exchange rates compared with 4.9 times on the same basis at 31 March 2008. About £323 million of our long-term bank debt will contractually fall due prior to 31 March 2010. Details of the Group's borrowings are disclosed in note 16.
We have contractual debt obligations and covenants that reflect our leverage. These could restrict flexibility in our use of financial resources to:
• Carry out our business
• Finance working capital, capital expenditures or other business opportunities
• React to changing market conditions, changes in our business or changes in the industry in which we operate
We have access to a £400 million revolving credit facility, of which £400 million remains committed (subject to covenant adherence) until April 2011, uncommitted facilities of £54 million in Spain and Latin America and cash of £51.1 million that we can use to mitigate the potential risks described above. We believe that, with the revolving credit facility, we have sufficient access to working capital to meet our operating and capital expenditure requirements in the 2010 financial year.
The Group is currently in full compliance with the financial covenants contained in its borrowing agreements, as set out in the table below. The net cash interest cover covenant requires that the ratio of adjusted EBITDA to net cash interest payable for the twelve-month period to the date of the covenant test should not be below specific threshold ratios at specific test dates. The debt cover covenant requires that the ratio of net debt at the testing date to adjusted EBITDA for the previous twelve-month period not exceed specific threshold ratios at specific test dates.
The threshold ratios at 31 March 2009 and for each test date in the 2010 financial year are set out below, as well as, reported ratios and headroom at 31 March 2009:
|
| Net interest cover(1) | Debt cover(1) |
| Covenant | ||
| 31 March 2009 | > 2.50x | < 5.55x |
| 30 June 2009 | > 2.36x | < 5.71x |
| 30 September 2009 | > 2.29x | < 5.58x |
| 31 December 2009 | > 2.37x | < 5.38x |
| 31 March 2010 | > 2.45x | < 5.17x |
| 30 June 2010 | > 2.59x | < 4.93x |
| Reported at 31 March 2009 | 2.96x | 4.72x |
| Reported headroom(2) | 16% | 15% |
(1) The definitions of EBITDA and interest charges required in the covenant tests do not always agree with the definitions used in this Annual Report, primarily because twelve-month pro forma results are used for the covenant tests.
(2) Calculated as the % by which EBITDA could have fallen before covenant restrictions were reached and includes reduced headroom for the nine months before covenant reset.
As a consequence of increasingly uncertain trading conditions, there is a risk that the Group might need to reset its financial covenants with its lenders to avoid a breach of those covenants. The following sensitivities are forward-looking statements that could be affected by several different variables and should be considered as the mid point in a range extending five percentage points above and below the figure given. A breach could happen if EBITDA were to fall in comparison to the previous year's comparable period by approximately 70% in the three months ending 30 June 2009, by approximately 33% in the six months ending 30 September 2009, by approximately 19% in the nine months ending 31 December 2009, or by approximately 13% in the year ending 31 March 2010. This could also happen if EBITDA for the twelve months ending 30 June 2010 is approximately 9% less than EBITDA for the year ended 31 March 2009.
If the Group is required but not able to agree amendments to the covenants such that undertakings to the Group's lenders are breached, then the syndicate of lenders would have the right, but would not be obliged, to demand immediate repayment of all amounts due to them subject to a two-thirds majority vote of the lenders approving such action.
Whilst this eventuality would, if it arose, cast doubt on the future capital funding of the Group, the Group's cash flow forecasts show sufficient resilience, despite the uncertain outlook, that in the year ahead interest payments will be fully met, with further cash generated to repay debt. For this reason the directors believe that adopting the going concern basis in preparing the consolidated financial statements is appropriate.
There has been no change in the role that financial instruments have in creating or changing the Group's risk between 31 March 2009 and the date of these financial statements.
Interest is payable under our senior credit facilities at a variable rate based on LIBOR plus a margin. We could be adversely affected if the interest rates we pay were to rise significantly. We mitigate this risk by fixing a portion of our interest rate through hedging arrangements:
• At the end of each quarter we review our future interest payment obligations in assessing the appropriate amount of hedging for at least the next 27 months.
• We have fixed interest on at least 97% of the indebtedness under the term bank facilities using interest rate swaps over the period to September 2010 and around 50% until March 2011.
• At 31 March 2009, we had £204.5 million net losses on interest rate swaps that were available for recognition as an increase of interest expense when settled in the future.
Our financial statements are presented in pounds sterling, and changes in the exchange rate between the US dollar and the pound sterling and the euro and the pound sterling will affect the translation of the results of our businesses with US dollar or euro functional currencies. Our exposure to currency fluctuations will depend on the mix of foreign currency and pounds sterling denominated indebtedness and the extent of any hedging arrangements:
• The composition of our debt partially hedges exchange rate fluctuation, because 46% of our debt and 45% of our net interest expense are denominated in US dollars, thereby reducing our US EBITDA exposure by approximately 26%. Additionally, 25% of our debt and 21% of our net interest expense are denominated in euros, thereby reducing our Euro EBITDA exposure by approximately 28%.
• We do not currently intend to use derivative instruments to hedge any foreign exchange translation rate risk relating to foreign currency-denominated financial liabilities, although we will continue to review this practice.
We have operations in countries where the functional currency is not pounds sterling. Significant cash inflows and outflows associated with the Group's operations within a country are generally denominated in local currency to limit the risks of foreign exchange movements on the local results. We use derivative financial instruments to hedge foreign exchange rate risk on significant transactions that are not denominated in local currency.
Financial reporting and related risk factors
We recognise the revenue and costs directly related to sales, production, printing and distribution from advertisement sales for a printed directory edition when we have completed delivery of that directory edition. Because the number of editions and type of directories are not evenly distributed during the year or published in the same quarter every year, our revenue and profits do not arise evenly over the year:
• During our 2009 financial year the four financial quarters accounted for, respectively, 19%, 23%, 27% and 31% of Group revenue.
• Different directories may grow at different rates, such that growth may not be evenly distributed between quarters.
• We sometimes need to rephase our timing of distributions into a later period for operational reasons, such as when we rescope directories or integrate acquisitions. We mitigate the risk of misunderstanding the nature of our growth by reporting an analysis of our revenue growth on a like-for-like basis.
Operating profit, EBITDA and other financial indicators generally relied on by investors to evaluate a company's financial performance may not, in our case, reflect actual cash received or expended during a given period:
• The period in which we recognise revenue may be different to the period in which our advertisers receive and pay our invoices.
• The period in which we recognise expenses may be different to the period in which we pay the supplier.
• We mitigate the risk of misunderstanding the nature of our growth in profits and cash flow by reporting a reconciliation of our operating profit to EBITDA and our EBITDA to operating cash flow, see note 2 on page 55.
We make subjective and complex judgements, giving due consideration to materiality, when estimating inherently uncertain amounts included in the financial statements. We mitigate the risk of results being materially different by regularly reviewing our estimates and updating them when appropriate. A description of what we consider to be the most significant estimates follows. Actual results could be different, but we do not believe materially different unless otherwise indicated:
• Receivables are reduced by an allowance for amounts that may not be collectible in the future. We continuously monitor collections and payments from our customers and maintain a provision for estimated credit losses based upon our historical experience and any specific customer collection issues that we have identified. We have demonstrated the ability to make reasonable and reliable estimates of allowances for doubtful accounts based on significant historical experience.
• Bad debts as a percentage of revenue in the US at 7.8% reflects the market conditions in the US, when compared to the 2.4% in Spain and 4.3% in the UK where the directories are more mature. Our consolidated bad debt expense was £134.6 million during the 2009 financial year and at 5.6% of revenue was higher than the previous year (4.4%).
• Goodwill is reviewed annually for impairment or whenever events or changes in circumstances indicate that the carrying amounts may not be recoverable and at the end of the first full year following acquisition. The carrying value of our operations are compared to their estimated recoverable values to determine whether goodwill is impaired. The recoverable value is estimated from a discounted cash flow model that relies on significant key assumptions, including after-tax cash flows forecasted over an extended period of years, terminal growth rates and discount rates. We use published statistics or professional advice where appropriate when determining the assumptions we use. In 2009 we recognised an impairment loss (£1,272.3 million) on goodwill related to our operations in Spain (£1,103.9 million), Chile (£120.1 million), Argentina (£40.8 million) and Peru (£7.5 million). Financial projections for all our operations were reduced to reflect the deepening economic recessions in Europe and the US and the expectation that the recession will spread to Latin America. This reduction was the main cause of the impairments in Spain and Chile. The goodwill in relation to Argentina would not have been impaired had the discount rate applied to that operation not changed to reflect specific risks arising in that country. The goodwill in relation to Peru would not have been impaired had the terminal growth rate applied to that operation not been adjusted to reflect the more cautious outlook we have taken in all jurisdictions. At 31 March 2009, the fair values of our operations in Spain, Chile, Argentina and Peru equalled their carrying values and, consequently, any adverse change in a key assumption with all other assumptions held unchanged would cause recognition of further impairment losses. Details of the Group's impairment reviews and sensitivities to changes in assumptions are disclosed in note 11 on page 62.
• Other non-current intangible assets and plant and equipment are long-lived assets that are amortised over their useful lives. Useful lives are based on management's estimates of the period over which the assets will generate benefits. The values of property, plant, equipment and assets with indefinite lives are reviewed annually for impairment. Other non-current intangible assets are reviewed for impairment whenever events or changes in circumstances indicate that their carrying amount may not be recoverable and at the end of the first full year following acquisition. Historically, we have not reduced the value of these assets as a result of the impairment analyses, nor have we realised large gains or losses on disposals of property, plant and equipment.
• The determination of our obligation, expense and contribution rate for pensions is dependent on the selection of assumptions that are used by our actuaries in calculating such amounts. Those assumptions include, amongst others, expected mortality rates of scheme members, the rate at which future pension payments are discounted to the balance sheet date, inflation expectations, the expected long-term rate of return on plan assets and average expected increase in compensation over and above inflation. We believe that our assumptions are appropriate because we regularly seek advice from experts. However, differences in our actual experience or changes in our assumptions can materially affect the amount of our future pension obligations, future valuation adjustments in the statement of recognised income and expense and our future employee expenses.
• We value the portfolio of assets held by the defined benefit pension scheme in the UK at market value when calculating our net pension asset or deficit. Values will increase and decrease as markets rise and fall. The trustees and management have an agreed strategy to mitigate the risk of having insufficient funds, if markets fall. The trustees annually match the low-risk asset portfolio against the cash outflows for the following twelve years. Against longer term cash payouts they match a combination of investments in index-linked gilts to mitigate inflation risk, and higher risk assets to get higher rates of growth. The trustees also work with management to ensure sufficient assets will be available to settle obligations extending beyond twelve years.
• The determination of our obligation and expense for taxes requires an interpretation of tax law. We seek appropriate, competent and professional tax advice before making any judgements on tax matters. Whilst we believe that our judgements are prudent and appropriate, significant differences in our actual experience may materially affect our future tax charges.
• We recognise deferred tax assets and liabilities arising from temporary differences where we have a taxable benefit or obligation in the future as a result of past events. We record deferred tax assets to the extent that we believe they are more likely than not to be realised. Should we determine in the future that we would be able to realise deferred tax assets in excess of our recorded amount or that our liabilities are different to the amounts we recorded, then we would increase or decrease income as appropriate in the period such determination was made.
• The determination of our obligation and expense for exceptional lawsuits was based on management's best estimates after taking into consideration appropriate advice from legal experts. The amounts could be different when settled.
Sensitivity analyses
The following analyses illustrate the effect that specific changes could have had on our results in the 2009 financial year. The analyses do not consider secondary effects or steps that could be taken to mitigate the primary effects and are only valid when all other factors are held constant. The following discussion of estimated amounts generated from the sensitivity analyses involves risks and uncertainties. Caution should be exercised in relying on these analyses:
Year ended 31 March 2009
| £ millions, unless otherwise stated | If on average | Had varied by being | Reported gain/(loss) | Equity gain/(loss) | Could have been |
| Market risks | |||||
| Adjusted EBITDA | Paper prices | 10% higher | 816.1 |
| 802.5 |
| Adjusted EBITDA | Paper prices | 10% lower |
|
| 829.7 |
| Net finance costs |
|
|
|
| |
| Without hedges | Variable rate interest | 1% higher | (296.7) |
| (340.1) |
| With hedges | Variable rate interest | 1% higher |
|
| (298.2) |
| Without hedges | Variable rate interest | 1% lower |
|
| (253.3) |
| With hedges | Variable rate interest | 1% lower |
|
| (295.2) |
| Net finance costs | Exchange rate of USD to GBP | 10% higher |
|
| (285.0) |
| Net finance costs | Exchange rate of USD to GBP | 10% lower |
|
| (311.0) |
| Net finance costs | Exchange rate of Euro to GBP | 10% higher |
|
| (302.0) |
| Net finance costs | Exchange rate of Euro to GBP | 10% lower |
|
| (290.2) |
| Basic loss per share | Exchange rate of US Dollar | 10% higher | (147.9) |
| (149.2) |
| Basic loss per share | Exchange rate of US Dollar | 10% lower |
|
| (146.2) |
| Basic loss per share | Exchange rate of Euro | 10% higher |
|
| (132.2) |
| Basic loss per share | Exchange rate of Euro | 10% lower |
|
| (167.0) |
| Significant estimates | |||||
| Adjusted EBITDA | Bad debt expense as a % of revenue | 1% higher | 816.1 |
| 792.4 |
| Adjusted EBITDA | Bad debt expense as a % of revenue | 1% lower |
|
| 840.4 |
| Operating loss | Useful economic lives of intangible assets | 1 year longer | (736.2) |
| (711.4) |
| Operating loss | Useful economic lives of intangible assets | 1 year shorter |
|
| (760.7) |
| Operating loss | Useful economic lives of plant and equipment | 1 year longer |
|
| (730.4) |
| Operating loss | Useful economic lives of plant and equipment | 1 year shorter |
|
| (747.9) |
| Operating loss | Discount rate on goodwill impairment analysis | 1% higher |
|
| (884.0) |
| Operating loss | Discount rate on goodwill impairment analysis | 1% lower |
|
| (553.7) |
| Operating loss | Terminal growths on goodwill impairment analysis | 1% higher |
|
| (587.5) |
| Operating loss | Terminal growths on goodwill impairment analysis | 1% lower |
|
| (937.4) |
| Actuarial loss - SORIE | Real interest rates in calculating pension liabilities | 0.1% higher |
| (31.6) | (38.1) |
| Actuarial loss - SORIE | Real interest rates in calculating pension liabilities | 0.1% lower |
|
| (25.1) |
| Actuarial loss - SORIE | Life expectancy in calculating pension liabilities | 1 year longer |
|
| (36.8) |
| Actuarial loss - SORIE | Future salary increases in calculating pension liabilities | 0.1% higher |
|
| (33.5) |
| Actuarial loss - SORIE | Future salary increases in calculating pension liabilities | 0.1% lower |
|
| (29.7) |
Financial instruments affected by market risk include borrowings, deposits, and derivative financial instruments. The following analysis, required by IFRS 7, is intended to illustrate the sensitivity to changes in market variables, being interest rates and the US dollar and Euro to sterling exchange rate on our financial instruments. The analyses are only valid when all other factors are held constant.
|
|
| 2009 |
| 2008 | |
| £ millions (loss) gain at 31 March | Income statement | Shareholders' equity | Income statement | Shareholders' equity | |
| Variable interest rates 1% higher, taking into account hedging arrangements | (1.5) | 70.2 | (1.7) | 85.9 | |
| Variable interest rates 1% lower, taking into account hedging arrangements | 1.5 | (67.7) | 1.7 | (88.3) | |
| Variable interest rates 1% higher, without taking into account hedging arrangements | (43.4) | - | (35.5) | - | |
| Variable interest rates 1% lower, without taking into account hedging arrangements | 43.4 | - | 35.5 | - | |
| US dollar to pounds sterling exchange rate 10% higher | 11.7 | (9.1) | 9.6 | (16.8) | |
| US dollar to pounds sterling exchange rate 10% lower | (14.3) | 9.1 | (11.7) | 16.8 | |
| Euro to pounds sterling exchange rate 10% higher | 5.3 | (4.4) | 4.5 | 0.3 | |
| Euro to pounds sterling exchange rate 10% lower | (6.5) | 4.4 | (5.4) | (0.3) |
Responsibility statement
The Annual Report and Accounts for the year ended 31 March 2009 contain, on page 36, a responsibility statement signed on behalf of the Board and stating as follows:
The directors, whose names and functions are listed below, confirm that to the best of their knowledge:
• The Group and parent company financial statements for Yell Group plc (the 'Company'), prepared in accordance with the applicable United Kingdom law and in conformity with IFRSs as adopted by the European Union, 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.
• The management report (which comprises the Directors' Report including the business review) includes a fair review of the development and performance of the business and the position of the Company and the undertakings included in the consolidation taken as a whole, together with a description of the principal risks and uncertainties that they face.
Bob Scott, Chairman
John Condron, Chief Executive Officer
John Davis, Chief Financial Officer
Tim Bunting, Non-executive director
John Coghlan, Non-executive director
Joe Eberhardt, Non-executive director
Carlos Espinosa de los Monteros, Non-executive director
Richard Hooper, Non-executive director
Lord Powell of Bayswater, Non-executive director
Enquiries:
Howard Rubenstein
Company Secretary
T: +44 (0) 118 950 6192