FINANCIAL RESULTS HIGHLIGHTS
Revenue of £2,964m/€4,031m; underlying growth +3%: The underlying growth rate reflects continued growth in electronic and face to face revenues (86% of the total), partially offset by continued print revenue declines.
Adjusted operating profit of £909m/€1,236m; underlying growth +5%: Growth expressed in sterling was +6%, and expressed in euros +18%, reflecting the sharp decline in the euro since the first half of 2014.
Reported operating profit: Reported operating profit, including amortisation of acquired intangible assets, was £737m (£697m) or €1,002m (€850m).
Interest and tax: Adjusted net interest expense was £75m (£69m) or €102m (€84m), with the £6m/€18m increase reflecting higher net borrowings and currency translation effects partly offset by a lower average interest rate. Adjusted tax was £194m (£186m) or €263m (€227m). The adjusted effective tax rate was 23.3%.
Adjusted EPS growth in constant currencies +8%: Adjusted EPS expressed in sterling was +8% to 30.1p, or +21% to €0.410 expressed in euros. The difference in growth rates between the sterling and euro EPS reflects the movement in average exchange rates to €1.36:£1 from €1.22:£1 in the first half of 2014.
Reported EPS: Reported EPS was 21.0p (20.0p) for RELX PLC and €0.313 (€0.268) for RELX NV.
Dividend: We have announced an interim dividend increase of +6% to 7.40p for RELX PLC and +17% to €0.115 for RELX NV. Following the UK government announcement that dividend tax credits will be abolished, future RELX PLC and RELX NV dividends will be equalised without any tax credit gross up (see page 12 for details).
Net debt/EBITDA 2.5x on a pensions and lease adjusted basis (unadjusted 1.9x): Net debt was £3.9bn/€5.5bn on 30 June 2015. The adjusted cash flow conversion rate was 85% (89%). For the full year we expect this rate to be over 90%, in line with prior years.
Organic development: In the first half we continued to develop our global technology platforms across the business, launch new products and services in both existing and adjacent market segments, and extend our reach in high growth markets and geographies. Capital expenditure as a percentage of revenues remained at 5%.
Portfolio development: We completed 11 small acquisitions of content, data and exhibition assets for a total consideration of £69m in the first half, and disposed of assets for £6m.
Share buybacks: In the first half we deployed £300m on share buybacks. In the remainder of 2015 we intend to deploy a further £200m, bringing the full year total to the previously announced £500m (in addition to annual employee share plan purchases of around £30m).
Corporate structure simplification: On 1 July 2015 we implemented the previously announced simplification of our corporate structure, our share listings, and our corporate entity names. In addition, we have now fully aligned the boards of the two parent companies, and we have presented our first half results on a consolidated, rather than combined, basis. The move to consolidated accounts has no impact on any figures, except for a minor positive restatement of the reported EPS for RELX NV.
FULL YEAR 2015 OUTLOOK
The full year outlook is unchanged. The key drivers within our business remain positive, and we are confident that, by continuing to execute on our strategy, we will deliver another year of underlying revenue, profit, and earnings growth in 2015.
