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Annual Report & Accounts 2013 - REPORT OF THE GROUP FINANCE DIRECTOR
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ANNUAL REPORT 2013 16 REPORT OF THE GROUP FINANCE DIRECTOR continued Table 12: Balance Sheet bridge Total €000's At 1 January 2013 58,471 EBITDA 38,299 Exceptional items (19,711) Net finance charges (1,104) Depreciation and amortisation (3,740) Taxation (711) 13,033 Movement on translation reserve 359 Issue of shares for Sportingbet acquisition 83,918 Share options exercised 294 Dividends paid (14,979) At 31 December 2013 141,096 CURRENCY EXPOSURES GVC Group reports in Euro and its main operating subsidiary is incorporated in the Eurozone. Table 13: Mix of currency exposures based on Q4-2013 revenues Euro 39% Turkish Lira 27% Brazilian Real 4% Sterling 4% Other currencies 26% During the year, the combined loss from realised and unrealised foreign exchange was €1.9 million although €1.1 million of this arose as a one-off re-translation of the Sportingbet ledgers, hitherto denominated in Sterling. The William Hill loan is denominated in Sterling (£6.9 million) and incurred an unrealised loss of €0.2 million. GVC does not take delivery of either TRY or BRL as such currency conversions are handled by the Group's payment processing intermediaries. Additionally, the Net Current Assets of the Group are of course revalued each month at month-end exchange rates and this also results in exchange gains and losses. The principal revaluations are for the customer liabilities, although these are now largely currency matched to produce a natural hedge. The relative purchasing power of the Euro has strengthened against three significant currencies for the Group. GVC estimates that the impact on profits from weaker TRY and BRL when compared to average rates in 2012 would be in the region of €5 million. Table 14: Relative purchasing power of the Euro (Source: www.oanda.com, the mid point of the bid/offer price has been selected) 1 Euro = Average Rate at Average Rate at % change % change in rate in 31 Dec rate in 31 Dec in average year-end 2012 2012 2013 2013 rate rate BRL 2.502 2.70856 2.8514 3.2531 Euro Euro Strengthened Strengthened by 14.0% by 20.1% TRY 2.314 2.3685 2.5199 2.9464 Euro Euro Strengthened Strengthened by 8.9% by 24.4% GBP 0.8113 0.8174 0.8491 0.8348 Euro Euro strengthened Strengthened by 4.7% by 2.1%