Morgan Advanced Materials Regulatory News (MGAM)

Half-year results for the six months ended 30 June 2018

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

2. Definitions of these non-GAAP measures can be found in the glossary of terms on page 39, reconciliations of the statutory results to the adjusted measures can be found on pages 11 - 15.

3. On a statutory basis operating profit in 1H 2018 was £50.1 million, this included a charge of £7.6 million for the exit and closure of the Composites and Defence Systems business. In 1H 2017 operating profit was £103.7 million, this included a profit on disposal of £46.1 million for the disposal of the global Rotary Systems and Electro-ceramics businesses.

Group highlights

· Strategy implementation remains firmly on track, with the strategy contributing to growth in the first half.

· Revenue growth* of 7.8% and Group headline operating profit* growth of 12.4% on an organic constant currency basis.

· Group headline operating profit margin* was 11.8%:

- Further incremental investment of £7 million in research and development, sales effectiveness, and wider business infrastructure funded through £7 million of operational efficiency savings.

- Organic volume growth was offset by foreign exchange, dilutive impacts of the 2017 divestments and some adverse mix in Thermal and Technical Ceramics.

· Headline EPS* growth of 13.9% reflected improvement in operating profit, lower financing charges and a lower effective tax rate.

· Continued improvement in cash generation, with net debt:EBITDA* 1.2 times.

Commenting on the results for Morgan Advanced Materials, Chief Executive Officer, Pete Raby said:

'We have made good progress with the implementation of our strategy in the first half and we expect to complete our execution priorities to plan during the year. 

Trading conditions have been good in the first half of the year in most of our markets. The Group has continued to grow organically reflecting these end market conditions and share wins driven by our strategy implementation. As we progress through the year, we expect the growth rate will moderate slightly as we track against a tougher prior year comparator period.

We are ahead of our plan to drive operational efficiency across the business, and these savings funded investment in research and development and sales effectiveness in the first half as planned.

Our expectations for the full-year are now slightly higher than previously anticipated.'

Strategy implementation firmly on track

We have made good progress with the implementation of our strategy, against the execution priorities defined in February 2016:

1. Move to a global structure. We completed the move to a global business structure in March 2016. The change in structure improved global co-ordination across the Group and sharpened accountability within each of our global business units. This was an important enabler to the wider changes we are making across the Group.

2. Extend our technology leadership. Our objective is to strengthen our technical teams and increase our investment in research and development. We have invested £2 million in the first half compared to the prior year, and expect to have invested an incremental £10 million per year by the end of 2018 compared to 2015.

The four Centres of Excellence (CoE) are focused on driving a range of materials and process developments to improve the differentiation of our materials portfolio and the performance of our products. We have continued to grow the resources in our CoE's, as well as adding test equipment to enhance our capabilities.

3. Improve operational execution. Our objective is to strengthen our operational capabilities, reduce operational costs to fund reinvestment in the business, and improve delivery and quality performance.

We are on track to deliver the planned £8 million of operational improvements in 2018 from improvement projects across each of the global business units focused on lean manufacturing processes including end-to-end waste elimination, smaller scale continuous improvement projects, procurement projects and further use of automation.

4. Drive sales effectiveness and market focus. Our objective is to strengthen our sales capability, and increase the intensity of effort with new customers and in new markets.

Our sales effectiveness programme is a significant change in the way we sell across the Group. We are progressively making changes to the key aspects of our sales approach including sales structures and roles, sales capabilities, route to market, customer segmentation and pricing, performance management and metrics, and sales incentives.

We have moved to wider deployment following the pilot activity completed in 2017. We have started the roll-out of pricing and segmentation tools across the business and continued to change sales structures to get more resources focused on key customers and growing market segments.

We have four sales incentives pilots underway with good progress year to date, and will deploy new sales incentive programmes more widely through the second half, learning from these initial trials.

A comprehensive sales training programme has been designed to upskill our teams in key selling techniques and behaviours and deployment will commence in the second half of 2018.

5. Increase investment in people management and development. Our objective is to strengthen our leadership capability and deepen functional capabilities across the business, including in sales and engineering.

Our new leadership behaviours were launched to our senior leaders during 2017. These are now built into our performance management process and our leaders are measured both on what they achieve and how they achieve it, ensuring we drive the behaviours needed to support the delivery of our strategy. Supporting this, we are redesigning our development programmes for senior leaders and have introduced an e-learning platform for our leadership population to support their overall skills development.

We continue to strengthen our leadership population, and have completed a number of key senior appointments in the first half.

6. Simplify the business. On 23 April 2018, the Group announced the exit of the Composite and Defence Systems business. This exit will take the form of the potential divestment of certain product lines, should a suitable acquirer be found, together with the closure of the remainder of the business lines.

We continue to simplify the Group and review the portfolio for fit with our corporate strategy.

Enquiries

Results presentation today

There will be an analyst and investor presentation at 08.00 (UK time) today at The London Stock Exchange, 10 Paternoster Square, London, EC4M 7LS.

A live video webcast and slide presentation of this event will be available on www.morganadvancedmaterials.com. We recommend you register by 07.45 (UK time).

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

2. Definitions of these non-GAAP measures can be found in the glossary of terms on page 39, reconciliations of the statutory results to the adjusted measures can be found on pages 11 to 15.

3. Details of specific adjusting items can be found in note 4 to the financial statements.

Thermal Products

Revenue for Thermal Products for the first half of the year was £241.8 million (1H 2017: £237.3 million), representing an increase of 1.9% compared with 1H 2017. Organic constant-currency revenue* increased by 7.4% compared to 1H 2017. Thermal Products EBITA* for the half-year was £29.7 million (1H 2017: £31.8 million) with an EBITA* margin of 12.3% (1H 2017: 13.4%).

Revenue for the Thermal Ceramics global business unit for the half-year was £217.3 million (1H 2017: £213.4 million), representing an increase of 1.8% compared with 2017. Organic constant-currency revenue* increased by 7.4% compared with 1H 2017. Continued strong growth in Asia, primarily China, India and South Korea, and a return to growth in Europe was offset by an organic* decline in the US.

Thermal Ceramics EBITA* for the half-year was £26.1 million (1H 2017: £28.2 million) with EBITA margin* decreasing to 12.0% (1H 2017: 13.2%). The margin decline was driven by two factors. First a geographic mix impact, with increased lower margin project volume in Asia and Europe and lower revenue overall in the US. Secondly, the profitability of the South American business declined, reflecting challenges in the Brazilian market.

Revenue for the Molten Metals Systems global business unit for the half-year was £24.5 million (1H 2017: £23.9 million), representing an increase of 2.5% compared with 1H 2017. Organic constant-currency revenue* increased by 7.5%. The core crucibles business grew by c. 6%, led by strong performance in the India region. The strengthening of the global precious metals (gold) market has continued to drive growth in the fire assay equipment and consumables business.

Molten Metal Systems EBITA* for the half-year remained flat at £3.6 million with EBITA margin* of 14.7% (1H 2017: 15.1%), reflecting the planned investment in technology and product development.

Carbon and Technical Ceramics

Revenue for the Carbon and Technical Ceramics Division for the half-year was £272.6 million (1H 2017: £270.0 million), representing an increase of 1.0% compared with 1H 2017. Organic constant-currency revenue* increased by 10.1% compared with 1H 2017.

Carbon and Technical Ceramics EBITA* for the half-year was £35.6 million (1H 2017: £32.7 million) with an EBITA margin* of 13.1% (1H 2017: 12.1%).

Revenue for Electrical Carbon for the half-year was £82.9 million (1H 2017: £80.9 million), an increase of 2.5% compared with 1H 2017. Organic constant-currency revenue* increased by 13.3%, driven by growth in the rail, wind, other renewable energy and semiconductor segments. On a regional basis, Asia saw double digit growth from strong sales of specialty graphite products accompanied by good growth in the wind sector. Strong year-on-year growth in North America was driven primarily by specialty graphite sales in addition to solid growth in the traditional rail and industrial business. Europe saw moderate growth in the wind and rail segments offsetting declines in the industrial market.

Electrical Carbon EBITA* for the half-year was £10.3 million (1H 2017: £8.6 million) with an EBITA margin* of 12.4% (1H 2017: 10.6%). Strong conversion of revenue growth more than offset the dilutive impact of the 2017 divestment of the global Rotary Transfer Systems business. Operational efficiencies funded further investment in sales effectiveness, research and development and wider business infrastructure.

Revenue for the Seals and Bearings global business unit for the half-year was £65.6 million (1H 2017: £55.9 million), an increase of 17.4% compared with 1H 2017. Organic constant-currency revenue* increased by 21.9%. The business experienced a strong year for ceramic armour material. Excluding armour sales, year-on-year organic* revenue growth on the core business was 5%. Organic growth* in the core business was driven by the water market, chemical and process industry pump seal and bearing demand, and growth in medical products. The growth in these markets offset continuing decline in the Korean automotive market during the half-year.

Seals and Bearings EBITA* for the half-year was £12.1 million (1H 2017: £9.1 million) with an EBITA margin* of 18.4% (1H 2017: 16.3%), and reflects increased volume, and good progress on operational improvements.

Revenue for the Technical Ceramics global business unit for the half-year was £124.1 million (1H 2017: £133.2 million), a decrease of 6.8% compared with 1H 2017. Organic constant-currency revenue* increased by 3.0%, primarily driven by moderate demand increases for ceramic cores in the aerospace market and supply of ceramic parts into the semiconductor and medical markets. This demand growth was partially offset by sharp slow-down in the industrial gas turbine (IGT) market.

Technical Ceramics EBITA* for the half-year was £13.2 million (1H 2017: £15.0 million) with an EBITA margin* of 10.6% (1H 2017: 11.3%). Margins at the half-year were impacted by mix effects, notably the significant reduction in higher margin IGT volume, and the dilutive impact of the 2017 divestment of the Electro-ceramics business.

Composites and Defence Systems

Revenue for Composites and Defence Systems for the half-year was £7.4 million (1H 2017: £11.5 million), representing a decrease of 35.7% on a reported basis.

EBITA* for Composites and Defence Systems was a loss of £0.9 million (1H 2017: loss of £0.4 million) with EBITA margin* of (12.2)% (1H 2017: (3.5)%).

Group financial review

Group revenue was £521.8 million (1H 2017: £518.8 million), an increase of 0.6% on a reported basis compared with 1H 2017, driven by improvements in the underlying business. Organic constant-currency revenue* increased by 7.8% in the first half. Excluding the impact of the growth in ceramic armour in Seals and Bearings, the Group organic constant-currency revenue* growth is 5.8%.

Group headline operating profit* was £61.5 million (1H 2017: £61.2 million). Headline operating profit margin* was consistent with 1H 2017 at 11.8%.

Operating profit before specific adjusting items was £57.7 million (1H 2017: £57.6 million) and profit before tax decreased to £43.9 million (1H 2017: £91.9 million). Current period operating profit was reduced by specific adjusting items of £7.6 million (1H 2017: increased by £46.1 million).

The net finance charge was £6.6 million (1H 2017: £11.8 million), primarily comprising of net bank interest and similar charges of £4.2 million (1H 2017: £8.4 million), the finance charge under IAS 19 (revised) of £2.4 million (1H 2017: £3.5 million), being the interest charge on pension scheme net liabilities. There was no gain or loss from financial instruments in the period (1H 2017: £0.1 million gain).

The Group amortisation charge for the half-year was £3.8 million (1H 2017: £3.6 million).

The Group taxation charge, excluding specific adjusting items, was £14.4 million (1H 2017: £13.8 million). The effective tax rate, excluding specific adjusting items, was 28.0% (1H 2017: 29.9%).

Headline earnings per share* was 13.1 pence (1H 2017: 11.5 pence), reflecting the improved operating profit, lower financing charges, and lower effective tax rate of 28.0%. Basic earnings per share was 9.1 pence (1H 2017: 26.9 pence).

Specific adjusting items

Specific adjusting items after income tax were £7.6 million (1H 2017: credit of £47.4 million) and consisted of the business closure and impairment costs for the Composites and Defence Systems business.

On 23 April 2018, the Group announced its decision to exit the Composites and Defence Systems business through closure and potential divestments. Discussions with possible acquirers of certain product lines are at a very early stage, and there can be no certainty that any divestments will be made.

As a result of this decision certain business closure and impairment costs have been recognised as specific adjusting items in the six months ended 30 June 2018. A total of £7.6 million has been recognised, of this £5.6 million relates to cash exit costs, comprising site clean-up costs, professional and legal fees, staff redundancies and onerous contracts, and £2.0 million relates to impairment of plant, property and equipment and other assets. Cash exits costs may be partially offset by any proceeds from the divestment of certain product lines. Goodwill in the Composites and Defence Systems business has a £nil net book value.

To the extent product lines in the business are closed, this will be completed when delivery of the last time orders from customers have been completed, currently anticipated to be in 2019.

Cash flow

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

2. Definitions of these non-GAAP measures can be found in the glossary of terms on page 39, reconciliations of the statutory results to the adjusted measures can be found on pages 11 to 15.

Cash flow from operations* was £53.5 million (1H 2017: £51.6 million), in line with prior year.

Free cash flow before acquisitions, disposals and dividends* was £18.8 million (1H 2017: £16.8 million), with increased capital expenditure driven by growth and efficiency projects, lower interest charges reflecting the revised debt structure and lower tax paid due to the tax offset from the one-off US pension deficit funding payments in December 2017.

Net debt* at 30 June 2018 was £188.2 million (FY 2017: £181.3 million), representing a net debt:EBITDA* ratio of 1.2x (FY 2017: 1.2x).

Defined benefit pension plans

The Group pension deficit has decreased by £26.8 million since last year-end to £191.2 million on an IAS 19 (revised) basis (FY 2017: £218.0 million). The decrease is primarily due to a rise in corporate bond yields and Group contributions in excess of the income statement charge for the period, offset by a fall in asset values (predominantly as a result of increased matching of the Schemes' liabilities).

· The UK schemes' deficit decreased by £25.0 million to £141.0 million (FY 2017: £166.0 million) primarily due to actuarial gains driven by the increase in the discount rate and increased contributions paid by the Group offset by investment losses. The discount rate increased to 2.63% (FY 2017: 2.38%).

· The USA schemes' deficit decreased by £1.7 million to £9.4 million (FY 2017: £11.1 million).The decrease is due to actuarial gains from movements in the discount rates offset by investment losses. The discount rate increased to 4.26% (FY 2017: 3.65%).

· The European schemes' deficit decreased by £0.4 million to £36.3 million (FY 2017: £36.7 million), due to Group contributions in excess of the charge to the income statement for the period. The discount rate remained constant since year-end at 1.60%.

· The Rest of World schemes' deficit increased by £0.3 million to £4.5 million (FY 2017: £4.2 million). The discount rate remained constant since year-end at 3.20%.

Foreign exchange

The principal exchange rates used in the translation of the results of overseas subsidiaries were as follows:

For illustrative purposes, the table below provides details of the impact on first half 2018 revenue and Group headline operating profit* if the actual reported results, calculated using 2018 average exchange rates for the six months to 30 June 2018 were restated for GBP weakening by 10 cents against USD in isolation and 10 cents against the Euro in isolation:

Interim dividend

The Board has resolved to pay an interim dividend of 4.0 pence per Ordinary share. The dividend will be paid on 23 November 2018 to Ordinary shareholders on the register of members at the close of business on 2 November 2018.

Principal risks and uncertainties

The Group has an established risk management methodology which seeks to identify, prioritise and mitigate risks, underpinned by a 'three lines of defence' model comprising of an internal control framework, monitoring and independent assurance processes. The Board considers that risk management and internal control are fundamental to achieving the Group aim of creating long-term sustainable shareholder value.

The current risks, representing those risks that the Board feels could have the most significant effect on achieving the Group's strategy of building a sustainable business for the long term and delivering strong returns to the Group's shareholders, are set out in the 2017 Annual Report, which is available on the Group's website at www.morganadvancedmaterials.com.

The Group has reviewed these risks and concluded that they adequately represent the current principal risks and uncertainties of the Group and will continue to remain relevant for the second half of the financial year.

The following are the Group's principal risks and uncertainties: technical leadership; operational execution, organisational change and sales effectiveness; portfolio management; macro-economic and political environment; environment, health and safety; product quality, safety and liability; IT and cyber security; supply chain and business continuity; treasury and tax; pension funding; contract management; and compliance.

The Board reviews the status of all principal risks with a notable potential impact at Group level throughout the year. Additionally, the Audit Committee carries out focused risk reviews of each Division. These reviews include an analysis of principal risks, together with the controls, monitoring and assurance processes established to mitigate those risks to acceptable levels.

Going Concern

As reported on page 40 of the 2017 Annual Report and Accounts, the Group meets its day-to-day working capital requirements through local banking arrangements and the committed £200 million unsecured five-year multi-currency revolving credit facility.

The Group's forecasts and projections, taking account of reasonably possible changes in trading performance, show that the Group is able to operate within the level of its committed facilities. The Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for a period of 12 months from the date of this Statement. Accordingly, they continue to adopt the going concern basis in preparing the condensed consolidated financial statements for the six months ended 30 June 2018.

Directors' Responsibility Statement

The Directors confirm that to the best of their knowledge:

· The condensed consolidated set of financial statements has been prepared in accordance with IAS 34 'Interim Financial Reporting' as adopted by the European Union;

· The interim management report includes a fair review of the information required by:

(a) DTR 4.2.7 of the Disclosure Guidance and Transparency Rules of the Financial Conduct Authority, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

(b) DTR 4.2.8 of the Disclosure Guidance and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

Information on the current directors of Morgan Advanced Materials plc responsible for providing this Statement is maintained on the Company's website at www.morganadvancedmaterials.com.

By order of the Board

Pete Raby

Chief Executive Officer

Peter Turner

Chief Financial Officer

Definitions and reconciliations of non-GAAP to GAAP measures

Reference is made to the following non-GAAP measures throughout this document. These measures are shown because the Directors consider they provide useful information to shareholders, including additional insight into ongoing trading and year-on-year comparisons. These non-GAAP measures should be viewed as complementary to, not replacements for, the comparable GAAP measures.

Headline profit and earnings measures

Group headline operating profit is stated before specific adjusting items and amortisation of intangible assets. Specific adjusting items are excluded on the basis that they distort trading performance. Amortisation is excluded as the charge arises primarily on externally acquired intangible assets since the adoption of IFRS and does not therefore reflect all intangible assets consistently.

Earnings before interest, tax and amortisation (EBITA) is stated before specific adjusting items, amortisation of intangible assets, restructuring costs and other items. Segment EBITA is stated before unallocated corporate costs.

s

1. Corporate costs consist of Specific adjusting items and the cost of the central head office.

2. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

1. Corporate costs consist of specific adjusting items and the cost of the central head office.

2. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

Group Organic Growth

Group organic growth is the growth of the business excluding the impacts of acquisitions, divestments and foreign currency impacts. This measure is used as it allows revenue and EBITA to be compared on a like-for-like basis. Commentary on the underlying business performance is included as part of the Operating review on pages 4 to 6.

Year-on-year movements in Segment Revenue

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

Year-on-year movements in Segment and Group EBITA

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

Group EBITDA

Group EBITDA is defined as operating profit before specific adjusting items, restructuring costs, other items, depreciation and amortisation of intangible assets. The Group uses this measure as it is a key metric in covenants over debt facilities. A reconciliation of operating profit to Group EBITDA is as follows:

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

Cash flow from operations and free cash flow before acquisitions, disposals and dividends

Cash flow from operations excludes the cash flows associated with restructuring activities and is shown because it illustrates the timing of the outflows relating to restructuring charges that may be incurred over more than one reporting period.

Free cash flow before acquisitions and disposals is defined as cash generated from operations less capital expenditure, net interest paid and tax paid.

The Group discloses this measure of free cash flow as this provides readers of the financial statements with a measure of the cash flows from the business before corporate level cash flows (acquisitions, disposals and dividends).

A reconciliation of cash generated from operations to cash flow from operations and free cash flow before acquisitions, disposals and dividends is as follows:

Net debt

Net debt is defined as interest-bearing loans and borrowings and bank overdrafts less cash and cash equivalents. The Group discloses this metric as it is a key metric in covenants over debt facilities.

Return on invested capital

Return on invested capital (ROIC) is defined as the 12-month Group headline operating profit (operating profit excluding specific adjusting items and amortisation of intangible assets) divided by the 12-month average adjusted net assets (third-party working capital, property, plant and equipment, land and buildings, intangible assets and other balance sheet items).

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

Headline earnings per share

Headline earnings per share is defined as operating profit adjusted to exclude specific adjusting items and amortisation of intangible assets, plus share of profit of associate less net financing costs, income tax expense and non-controlling interests, divided by the weighted average number of Ordinary shares during the period. This measure of earnings is shown because the Directors consider it provides a better indication of headline performance.

Whilst amortisation of intangible assets is a recurring charge it is excluded from these measures on the basis that it primarily arises on externally acquired intangible assets and therefore does not reflect consistently the benefit that all of Morgan's businesses realise from their intangible assets, which may not be recognised separately.

Constant-currency revenue and Group headline operating profit

Constant-currency revenue and Group headline operating profit are derived by translating the prior year results at current year average exchange rates. These measures are used as they allow revenue to be compared excluding the impact of foreign exchange rates. Page 8 provides further information on the principal foreign currency exchange rates used in the translation of the Group's results to constant-currency at average exchange rates.

Condensed consolidated income statement

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

2. Details of specific adjusting items are given in note 4 to the financial statements.

3. The proposed interim and approved final dividends are based upon the number of shares outstanding at the balance sheet date.

Condensed consolidated statement of comprehensive income

Condensed consolidated statement of comprehensive income (continued)

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

Condensed consolidated balance sheet

1. The six months ended 30 June 2018 have been prepared reflecting the adoption of IFRS 15. The six months ended 30 June 2017 and year ended 31 December 2017 have been restated to reflect the adoption of IFRS 15. Further details are provided in notes 1 and 12 to the financial statements.

Condensed consolidated statement of changes in equity