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Annual Report & Accounts 2013 - REPORT OF THE GROUP FINANCE DIRECTOR
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GVC HOLDINGS PLC ANNUAL REPORT 2013 13 Whilst the acquisition balance sheet was significantly worse than anticipated, the swift turnaround of the business coupled with the mitigated earn-out payments under the Superbahis transaction meant that the acquisition 'washed its face' in less than nine months. Table 7: Cash impact of the acquisition and its results during 2013 In €millions Total Acquisition Exceptional balance sheet items Costs of removing Sportingbet board (5.0) (5.0) Transaction fees incurred by Sportingbet (8.6) (8.6) Net current liabilities at acquisition (36.0) (36.0) Balance sheet deficit (49.6) (49.6) - GVC transaction costs (9.3) (9.3) Restructuring costs (11.9) (11.9) William Hill plc capital contribution 42.6 42.6 William Hill loan 8.0 Profits arising from Sportingbet turnaround, Superbahis mitigation and Spanish contribution 25.1 - 1.5 4.9 (7.0) (19.7) NET CURRENT ASSETS The net position is obviously affected by the timing of the dividend payments - which totalled €15.0 million during 2013 (2012: €8.2 million). Such is the strategy of GVC towards its dividend payments, that GVC aims to keep its Net Current Assets relatively equal to its Net Current Liabilities, but ensuring at all times that its balances with customers are covered and meet regulatory requirements. Table 8: Liquidity position as at 31 December 2013 €000's €000's Restricted cash* 7,356 Add: cash in transit with payment processors 18,270 Total 25,656 Less: Customer balances (13,298) Surplus over customer liabilities 12,358 Free cash 11,452 Trade payables (9,586) 1,866 Instalments payable in 2014 to providers of lease finance (945) Instalment payable to William Hill in December 2014 (2,752) Loan imputed interest 238 (2,514) Corporate and other taxes reclaimable less payable (539) Other tax liabilities (4,182) Accruals, prepayments and other net current assets (5,765) Net current assets 279 * Restricted cash refers to balances at banks where the cash has to be ring-fenced for regulatory reasons. BUSINESS REVIEW