Annual Report & Accounts 2014 - REPORT OF THE GROUP FINANCE DIRECTOR
GVC HOLDINGS PLC ANNUAL REPORT 2014 11
contribution increased by 20% to €123.3 million, and a contribution margin percentage of 55% was achieved.
(2013: proforma contribution margin 56%).
in the context of a growing business, absolute costs have increased from €64.3 million to €74.1 million, but
cost ratios have improved to 60% down from 63%. staff cost ratios remained level, despite one third of staff
costs (2013: 20%) being performance related - chiefly based on group dividend payments. this should be
seen in the context of €33.6 million of dividends paid in 2014, an increase of 124% on the €15 million paid in
Table 3: The principal cash expenditures of the Group (excluding exceptional items) and their percentages
In €millions 2014 % of NGr 2013 % of NGr
staff costs excluding performance pay 29.2 13% 25.6 15.1%
technology and product content 21.0 9.3% 19.8 11.7%
other costs 10.0 4.4% 12.4 7.3%
60.2 27% 57.8 34.0%
performance pay 13.9 6.2% 6.5 3.8%
74.1 32.3% 64.3 37 .8%
total staff costs 43.1 19.2% 32.1 18.9%
the group aims to achieve a clean eBitda margin of not less than 20%.
clean eBitda rose 28.5% to €49.2 million (2013: €38.3 million), and a 22% margin on ngr was achieved,
slightly higher than in 2013.
NoN-caSh ItEmS oF aN accoUNtING NatUrE
Depreciation of Property, Plant and Equipment rose in the year to €0.7 million (2013: €0.5 million) on total
acquisitions of €0.9 million.
Amortisation of Intangible Assets amounted to €3.2 million (2013: €3.2 million) arising from either assets
acquired through the sportingbet acquisition or through the acquisition of additional software and software
development costs required to run the sportsbook platform.
Finance charges included an imputed debit (as per ias 39) on the interest free loan from william hill of €0.2
million. a rate of 4% has been used for the imputation. other finance charges related to €0.7 million (2013:
€1.7 million) on the unwinding of the discount on the deferred consideration arising from the 2009 acquisition
of Betboo, €0.6 million on the retranslation of the gBp denominated william hill loan and leased software
assets and €67k (2013: €43k) in respect of finance charges on leased software assets.
Share option charges amounted to €0.7 million (2013: €0.7 million). the charge for 2014 represented the final
accounting charges for the share options awarded in in 2010 and 2012, in addition to the charges arising from
the share options awarded and announced on 2 June 2014. the group has only 5.6 million share options
granted to directors and officers (9.2% of the existing issued share capital although its permitted allocation is
16.8% of the issued share capital (page 354 of the January 2013 prospectus)). of the charge in the current
year, €0.5 million relates to equity settled options and €0.2 million relates to cash settled options with a
corresponding liability recognised in the consolidated balance sheet.
Betit put option: the effect of valuing the Betit put option resulted in a €1.6 million charge in accordance with
ias 39 'financial instruments: recognition and measurement'.
EarNINGS pEr SharE
Table 4: Earnings per share
Basic eps: 66.4 €cents (2013: 22.5 €cents)
diluted eps: 61.4 €cents (2013: 22.0 €cents)
the diluted eps is affected by two components: grants of share options granted to employees and directors,
and warrants granted to third parties pursuant to underwriting arrangements entered into in contemplation of
the sportingbet acquisition.