Final Results

PRESS RELEASE

Charles Taylor plc

Announcement of results for year ended 31 December 2013

Consolidated financial highlights

For the year ended 31 December 2013

Note:

1. The 2013 adjusted profit before tax figures exclude acquired intangible amortisation charges of £1.2m (2012: £1.3m), pre-tax non-controlling interests of £0.2m (2012: £1.2m) and non-recurring costs of £1.6m (2012: £nil).

2. The final dividend is payable on 23 May 2014 to shareholders on the register on 11 April 2014.

3. 2012 figures have been restated for IAS19 (revised 2011).

"Charles Taylor made good progress in 2013. The Group's core professional services businesses have performed well, supported by a satisfactory result from the Group's owned insurance companies."

Rupert Robson

Chairman

Business highlights

· Increased Group revenues.

· Increased Group adjusted profit before tax and statutory profit before tax.

· Delivered higher Professional Services operating segment profit, largely driven by strong Adjusting Services growth.

· Increased net debt due to an increase in Adjusting Services working capital, restructuring costs and acquisitions.

· Renewed the Group's senior banking facilities for a five year term.

· Progressed growth initiatives.

· Final dividend of 6.75p, maintaining the full year dividend at 10.00p.

Chairman's Statement

Charles Taylor made good progress in 2013. The Group's core professional services businesses have performed well, supported by the result from the Group's owned insurance companies.

Results

Revenue increased to £113.6m (2012: £108.2m). Group adjusted profit before tax rose to £10.0m (2012: £9.1m3), while Group statutory profit before tax increased to £6.9m (2012: £6.6m3). Adjusted earnings per share rose to 20.05p (2012: 18.33p3). Statutory earnings per share fell to 14.22p (2012: 15.14p3).

Our professional services businesses generated increased revenue and operating segment profit driven by a solid performance in Management Services and strong growth in Adjusting Services where we are reaping the benefits of the continued investment in new offices and people. Insurance Support Services continues to face challenges, mainly due to the loss of some larger legacy contracts which have only been partly compensated by new business. Our Insurers in Run-off business performed as expected with operating segment profit attributable to shareholders down.

Dividend

It is proposed that a final dividend of 6.75p per share (2012: 6.75p) be paid on 23 May 2014 to shareholders on the register on 11 April 2014. When added to the interim dividend of 3.25p per share (2012: 3.25p), this results in the total dividend per share for the year being maintained at 10.00p (2012: 10.00p).

Balance sheet

Net debt increased at the year end to £32.4m (2012: £29.5m) and free cash flow decreased to £5.5m (2012: £12.4m). This was largely as a result of acquisitions made during the year, an increase in working capital in Adjusting Services, and restructuring costs. We continue to focus on managing our debt while investing for growth. We completed the refinancing of the Group's senior term debt and revolving credit facilities for a term of five years. Net pension liabilities fell compared to the prior year end as a result of improving market conditions.

Board

Julian Avery retired from the Board and as Chairman of the Remuneration Committee at the end of December 2013. I would like to thank Julian for his significant and valuable contribution to Charles Taylor over the last five years.

I am very pleased to welcome Edward Creasy to the Board as a non-executive director from 1 January 2014, following Julian's retirement. Edward has had a long career in the London Market insurance industry and will bring extensive knowledge and experience to our deliberations.

I am also pleased to report that Gill Rider has taken on the role of chairing the Remuneration Committee.

As reported at the Half Year, Alistair Groom retired from the Board and from Charles Taylor at the end of February 2014. I would like to thank Alistair for his long and distinguished service to Charles Taylor and the Standard Club over the last 36 years. I am delighted to report that he will be remaining on the board of Standard Club Europe.

Corporate governance

Our Board has a broad, diverse range of skills and specialised knowledge, which enables us to achieve high standards of corporate governance. We provide leadership for the Group in setting strategy, monitoring performance and ensuring that the appropriate resources are in place to meet our corporate objectives.

Current trading and outlook

Overall trading has started steadily.

Our result has been achieved thanks to commitment of our highly professional team and I would like to thank all our staff for their hard work throughout the year.

Rupert Robson

Chairman

18 March 2014

3. 2012 figures have been restated for IAS19 (Revised 2011).

Group Chief Executive Officer's Review

2013 was a year of positive advancement for Charles Taylor. We made progress with many of our growth initiatives and took further important steps to optimise our business operations in order to establish a firm foundation for further growth.

2013 performance

Professional Services

The Group's core professional services businesses made good overall progress as set out in the table below. Revenue increased by 5.5% to £111.9m (2012: £106.1m) and operating segment profit was up 11.6% to £10.5m (2012: £9.4m3):

· The performance of our Management Services business was steady as the underlying mutual insurance companies we manage continue to grow.

· The Adjusting Services business performed very well with encouraging levels of claims work across all business lines.

· The smaller Insurance Support Services business continued to find trading conditions challenging and its performance was disappointing.

Insurers in Run-Off: The Insurers in Run-off business revenue was £5.0m (2012: £5.4m). Operating segment profit increased to £0.8m (2012: £0.3m), although the result attributable to shareholders was down after non-controlling interests.

Management Services

The Management Services business provides end-to-end management services to insurance companies and associations. We deliver a complete outsourced management and operational service to our insurance company clients, reporting directly to their independent boards of directors. Our services cover every aspect of those companies' operations from underwriting, claims management and delivery of safety services to regulatory, accounting and administrative operations, investment management, customer service, corporate governance and company secretarial services. We primarily manage three mutual insurance companies - the Standard Club, Signal and SCALA - and provide administration services to the Offshore Pollution Liability Association.

We are remunerated by fees from our mutual insurance company and association clients. Where we provide a full management service, growth in the size of the mutuals, the number and extent of services we deliver and the volume of work involved generally leads to growth in management activities and ultimately the level of management fees. The performance of the managed mutual insurance companies is strong - providing a positive long-term indicator of the Management Services business. The business also seeks to grow through the identification and implementation of opportunities to develop new insurance ventures and by tendering for the management contracts of existing mutual insurance companies and other associations.

Management Services - UK & International

Standard Club: our work for the Standard Club delivered a solid result for the club and Charles Taylor secured an increased management fee for the year. The club provides protection and indemnity (P&I) insurance to approximately 10% of world shipping. Ship operators are attracted by the club's financial strength, high quality membership and reputation for service.

Insured tonnage increased by 4.6% over the year and stood at 137m gt at 31 December 2013. This growth was the result of increased entries in the club by existing members and the addition of some new members. Total calls and premiums for the 2012-13 policy year were US$294m. The club had a satisfactory 2014-15 renewal in February 2014, with a slight fall in insured tonnage and an overall increase of 10% in premiums.

New client:

· Offshore Pollution Liability Association (OPOL): In 2013, we successfully tendered to provide administrative and financial services to OPOL following a competitive tender. All offshore operators currently active in exploration and production on the United Kingdom Continental Shelf are party to a voluntary oil pollution compensation scheme known as OPOL. It applies to all offshore facilities from which there is a risk of a discharge of oil causing pollution damage. The Association exists to ensure that, in the event of a spillage or escape of oil, third party claims for pollution damage are met and the cost of remedial measures reimbursed under the terms of the OPOL Agreement.

New products and services:

· The Standard Club Hull facility operated by Charles Taylor was launched in April 2013 met with positive interest from both ship owners and brokers. Over 600 vessels are now insured under the facility.

· Charles Taylor launched a new Directors and Officers (D&O) insurance product for ship owners at the end of 2013. We believe this product will be attractive to ship owners familiar with the quality and reputation of the Standard Club and Charles Taylor.

Management Services - Americas

The Management Services Americas business had a successful 2013.

Signal Mutual: Charles Taylor has been the manager of Signal Mutual, the largest provider of longshore workers' compensation insurance to the US maritime industry, since it was founded in 1983.

Our work for Signal Mutual delivered a positive result for the Association. Eighteen new member companies joined Signal for the 2012/13 membership year. 98% of existing members renewed their workers' compensation insurance with the mutual and total membership has now reached 235 companies. The total payroll of the member companies, on which calls are calculated, reached US$3.34 billion, an increase of 11.7% and a record for the Association. Total calls for the year will be around US$218.2m, up by 6.4% over the previous year. Signal continued to deliver an outstanding safety record with both the number of total claims reported and lost time incidents per 200,000 man hours reducing by over 20% in the year. A new three year management fee agreement with the mutual, commenced on 1 October 2013.

SCALA provides workers compensation to the majority of Canada's ship owners. The mutual delivered a steady performance during 2013. Total calls for the year were Canadian $5.7m.

New services:

2013 was an important year for the development of services in Management Services - Americas:

· We launched a new claims adjusting service to assist ports and terminals operators in the management of their workers' compensation claims and have already secured a major contract.

· Our Safety Management Service, launched in 2012, secured nine new clients during the year.

· We established Charles Taylor General Agency to market Charles Taylor developed insurance covers to clients in the USA such as Hull and Machinery, D&O and other insurance covers. It is currently in the process of being licenced in over 40 states.

· We created a new Marine Claims Auditing service, combining skills from Charles Taylor Technical Services and other claims professionals across the Group, which secured its first client.

Adjusting Services

The Adjusting Services business provides loss adjusting services across the aviation, energy, marine, property & casualty and special risks sectors. It also provides average adjusting services for ship owners. The business primarily focuses on larger and more complex claims arising from major insurance losses.

The business performed well over the year with all adjusting business lines delivering strong performance. In particular, we benefited from a steady volume of larger and more complex claims to adjust over the whole year rather than being requested to work on a small number of exceptionally large claims.

Aviation performed well with continued growth in claims in Asia. We were appointed to adjust a number of large energy claims around the world, including in Canada, Argentina and Africa. Our Marine team benefited from a steady flow of work. Our Property & Casualty and Special Risks team performed well. In particular, we were instructed on significant business following the Calgary and Toronto floods. We also secured a greater volume of work in the professional and financial risks classes and delivered strong growth from property & casualty claims in Indonesia.

In 2013 we continued to invest in new people, offices and systems:

· We developed our office network further, as we believe our strong international network gives us a competitive advantage. Market feedback indicates we secured a number of claims during the year as a direct result of having offices and staff available in the right locations. Our new offices in Colombia and San Francisco are now fully established. We have also registered a business in Brazil working in close co-operation with the Management Services business; we anticipate that the office will be fully established and operational in 2014, providing both loss adjusting services and P&I services.

· We completed the acquisition of a majority stake in Noble Inspection and Loss Adjustment Company (NILACO), a licensed loss adjuster based in the Kingdom of Saudi Arabia. The acquisition provided us with offices in Riyadh and Jeddah and the ability to deliver loss adjusting services across Saudi Arabia. It builds on the Group's existing capabilities in the Middle East with offices already in United Arab Emirates and Qatar.

· Our initiatives to recruit new senior adjusting staff who can win additional business and strengthen our relationships with markets continued. As indicated at the half year, we saw some staff movement and stepped up our programme of identifying highly qualified senior adjusting specialists to join our teams. As a result, new senior appointments have been successfully made in our energy business line in the UK. We have also appointed senior adjusters in our Houston office and expanded our financial lines adjusting capability with new appointments in the UK.

· We continued to focus on managing the working capital requirements of the Adjusting Services business and collected a record amount of cash, £60.7m, in 2013. Collections, measured in debtor months were slightly slower than the prior year. Debtor months rose to 4.9 (2012: 4.3 months) and work in progress increased slightly to 5.2 months (2012: 5.1 months). We achieved record revenue in 2013 as a result of the positive growth in claims volume and workload which increased the business's working capital.

· We made good progress on a major project to develop and roll out our new loss adjusting claims management system. Initial trials have been successfully completed. We expect that the new system will increase efficiency, reduce the administrative burden for our loss adjusters and support our drive to reduce working capital.

· We are developing an enhanced management structure in Adjusting Services which is being rolled out during 2014. This is designed to support the continued strong growth in the business. It will also allow us to capitalise more fully on the combination of our business line expertise and regional strength.

Insurance Support Services

The Insurance Support Services business, the smallest of our Professional Services businesses, provides technical services to clients in the Lloyd's, London and international insurance markets. For example, it provides services to around 80% of Lloyd's managing agents. It also delivers life and non-life run-off servicing services from London, Dublin and the Isle of Man. The business is a leading provider of third party life insurance administration on the Isle of Man and also includes our investment management, captive management, risk consulting and specialty risks business lines. Finally, the Insurance Support Services business acts as the Group's business incubator where we can develop and test new business initiatives.

Insurance Support Services - Non-life: We appointed a new head of non-life ISS in the second half of the year to give a stronger identity and clear vision to the non-life Insurance Support Services (ISS) businesses. His initial focus is on developing existing and new service offerings to clients along with identifying synergies and opportunities for joint working across the Group.

Charles Taylor Insurance Services (CTIS): CTIS is the largest of the non-life Insurance Support Services business lines. It provides outsourced back office insurance services to the Lloyd's, London and international insurance markets. As reported at the half year, market demand for some services reduced, leading to the loss of a few larger legacy contracts. While action was taken to cut costs, this still impacted the full year performance. The new services we launched in the year have taken longer than expected to gain traction and hence were not sufficient to counter-balance the fall off of existing legacy contracts. There are now some signs that new business performance is improving:

· We were appointed to develop and manage a new Third Party Administrators Central Database by the Lloyd's Market Association following a competitive tender.

· Our Taylored Claims Management services, which enable Lloyd's managing agents to achieve faster claims settlement was purchased by three major managing agents.

· We were appointed by two Managing General Agencies to provide administrative services.

There is an ongoing move in the Lloyd's market to offer greater choice of outsourcing partners to Lloyd's market participants. We believe we are well positioned to capitalise on this trend and have invested in a senior team to develop new elective claims services for Lloyd's Managing Agents.

Charles Taylor KnowledgeCenter: In the last months of 2013 we acquired the business and assets of KnowledgeCenter, a leading provider of tailored business solutions to the insurance industry. The acquisition gives us a competitive advantage on key technology products and processes, which we can combine with our other insurance support services. While initial sales have been slower than expected, it is still early days and the integration of the business is progressing.

Other non-life Insurance Support Services: Our Captive Management business continues to perform steadily and we have won contracts to manage a number of additional captive insurance cells. Our speciality risks business, which provides tailored insurance products to meet the specific insurance needs of niche sectors, has worked closely with the Management Services business to develop new insurance covers for the international marine market.

Other Insurance Support Services: The UK offshore life run-off servicing business performed in line with the expected run-off profile. We also strengthened the business development, legal and administration teams in our investment management business, which continues to deliver a steady performance.

Insurers in Run-off

The Insurers in Run-off business owns life and non-life insurance companies which are closed to new business and runs off their liabilities in an orderly manner.

*. Excluding non-controlling interests

UK Offshore Life Run-off: We completed the integration of the Global Life Assurance business, acquired in 2012, into our Isle of Man run-off life business in the second half of the year, generating a small cash release. In line with our business strategy, we continue to seek further UK offshore life insurance acquisitions, which meet our criteria. These also benefit our Insurance Support Services business through increased run-off servicing contracts.

Non-life Run-off: The Group's three non-life insurance companies are running off satisfactorily, with claims experience improving compared to the prior year. We continue to explore our options in the non-life market following our decision not to acquire any further non-life run-off businesses.

Other business strategy initiatives:

In addition to the initiatives to optimise business operations already highlighted in this report, we also took a number steps to further strengthen and increase the efficiency of our shared services teams. Notable developments include:

· We established IT teams in Vietnam to help develop a new system for Management Services and the new loss adjusting management system for Adjusting Services. This takes advantage of the high levels of IT literacy, lower operating costs and operational scalability in Vietnam.

· Our facilities team successfully renegotiated charges for business rates, property insurance, and service charges delivering a material cost saving.

· Our finance team renegotiated the Group's senior finance facilities on favourable terms and delivered significant cost savings on external audit fees.

Business restructuring

During the year we also took steps to improve operational efficiency. We reviewed the structure of our professional services businesses to better align headcount with the areas of strong growth. Overall headcount increased by 5.5%, when including new offices openings and the acquisitions made during the year. In some areas we have been able to achieve significant long-term staff cost savings.

Outlook

2013 was an important year of development and progress at Charles Taylor. We have made considerable efforts to ensure that our business has good, varied and reliable sources of profitable income, and, as a result we are well positioned to make further progress in our endeavour to grow our business profitably in the years to come.

David Marock

Group Chief Executive Officer

18 March 2014

3. 2012 figures have been restated for IAS19 (Revised 2011).

Group Chief Financial Officer's report

The results for the year are summarised in the table below and explained in more detail in the Group Chief Executive Officer's review.

Note: Small rounding differences arise in the total amounts above.

The above financial measures are adjusted to exclude acquired intangible charges, non-recurring costs and non-controlling interests as set out in the table below:

Note: Small rounding differences arise in the total amounts above.

Adjusted profit before tax was £10.0m (2012: £9.1m)3, with higher profit in Professional Services offsetting a lower contribution from Insurers in Run-Off. Within Professional Services, Adjusting Services performed strongly, more than compensating for the weaker performance in Insurance Support Services, while Management Services delivered consistent results. Insurers in Run-off achieved a positive result at operating segment profit level, but adjusted profit before tax was down after non-controlling interests. This is due to lower profits in the Offshore Life Run-off business which in 2012 had benefited from the sizeable transfer of the Alico Isle of Man business. This was not repeated in 2013 despite the transfer of the smaller Global Life Assurance business. The Non-life Run-off companies Cardrow Insurance Limited and Bestpark International Limited showed an improved claims experience, although this had limited impact on the adjusted profit before tax due to the large non-controlling interests in these companies.

Statutory profit before tax was up at £6.9m (2012: £6.6m 3). Statutory EPS was down at 14.22p (2012: 15.14p3.) as a result of the reduced impact of non-controlling interests and the higher number of shares in issue during the year.

Net debt, cash flow and financing

Net debt increased by £2.9m over the year to £32.4m (2012: £29.5m), while free cash flow decreased to £5.5m (2012:£12.4m). The reduction in free cash flow results mainly from lower distributions from Offshore Life Run-Off, the working capital increase in Adjusting Services due to the strong growth and new office openings during the year, and the restructuring cost. Net debt also reflects the cash considerations paid for the two acquisitions made during the year. We are continuing to focus on managing our debt while investing for growth.

The Group's senior banking facilities were renewed on 7 November 2013 for a five year term. They now comprise an amortising senior term loan of £10.0m and a £30.0m revolving credit facility. In addition, the Group has £5.0m committed overdraft facilities in the UK and £6.1m overseas. Total headroom on committed facilities at year-end was £15.6m (including surplus cash). Interest rates are mostly linked to 3m Libor plus margins of 2.25-2.75%. The senior term loan and revolving credit facility are available until 7 November 2018. The other facilities are renewed on an annual basis.

Restructuring and operational efficiency

We remain focused on improving operational efficiency and are taking action to remove costs from our businesses. These include targeting savings in general expenses, introducing a central procurement capability, reducing third party professional fees and renegotiating property and IT infrastructure costs. We reviewed the structure of our professional services businesses to better align headcount with the areas of strong growth. Overall headcount increased by 5.5%, when including new offices openings and the acquisitions made during the year. Charges associated with staff restructuring of £1.4m have been excluded in the calculation of adjusted profit before tax and earnings per share figures.

Retirement benefit schemes

The retirement benefit obligation in the Group balance sheet at 31 December 2013 was £26.7m, compared to £31.6m at the previous year end. The reduction in net obligation has been driven by change in market conditions, employer contributions, investment gains, and reduced provisions for possible Normal Retirement Date liabilities. There are multi-year programmes in place to recover pension scheme deficits fully on a regulatory funding basis and funding costs are reflected in management fees charged by the Group where appropriate. Employer contributions in the year were £3.7m (2012: £3.6m).

Dividends

The proposed final dividend for 2013 is 6.75p (2012: 6.75p) making the total dividend for the year 10.00p, unchanged from the prior year.

Foreign exchange

The Group manages its exposure to foreign currency fluctuations by use of forward foreign exchange contracts and options to sell currency in the future. The contracts open during the year and at the year-end were to protect the Group's exposure to movements between £sterling and the US$, the Singapore$ and the Canadian$. The US$ profits of the Group were translated at 1.57 in 2013 (2012: 1.59). Results were not materially affected by movements in exchange rates between 2012 and 2013.

Taxation

During 2013, the effective tax rate on statutory profit was 19.8% compared to 25.7%3 in 2012. The underlying tax rate, which is calculated on adjusted profit and excludes prior year adjustments and the recognition of new deferred tax assets, was 16.1% (2012: 20.9%3). The statutory and underlying tax rates are lower because a larger proportion of profits were generated in lower tax countries.

Tito Soso

Group Chief Financial Officer

18 March 2014

3. 2012 figures have been restated for IAS19 (Revised 2011).

FINANCIAL STATEMENTS

Consolidated Income Statement

2012 figures have been restated for IAS19R. Adjusted earnings per share figures are shown in the consolidated financial highlights on page 1.

Consolidated Statement of Comprehensive Income

2012 figures have been restated for IAS19R. Consolidated Balance Sheet

The financial statements were approved by the Board of Directors and authorised for issue on 18 March 2014.

Tito Soso

Director

18 March 2014

Cash Flow Statement

Consolidated Statement of Changes in Equity

2012 figures have been restated for IAS19R.

The capital reserve and merger reserve arose on formation of the Group and are non-distributable capital reserves.

Own shares comprise 258,453 (2012: 238,920) shares held by the Charles Taylor Employee Share Ownership Plan Trust ("ESOP"). The market value of these shares was £651,302 (2012: £402,580) at the balance sheet date.

The trustee of the ESOP is the Codan Trust Company Limited, an independent professional trust company registered in Bermuda. The ESOP is a discretionary trust for the benefit of employees of the Group and provides a source of shares to distribute to the Group's employees (including executive directors and officers) under the Group's various bonus and incentivisation schemes, at the discretion of the trustee acting on the recommendation of a committee of the Board.

The assets, liabilities, income and costs of the ESOP are incorporated into the consolidated financial statements.

There are no significant restrictions on the ability of subsidiaries to transfer funds to the parent in the form of cash dividends or to repay loans or advances other than company law requirements dealing with distributable profits, and in the case of the insurance companies regulatory permissions and solvency limits.

Notes to the Financial Statements

1. Accounting policies

Basis of accounting

The financial information set out above does not constitute the statutory accounts of Charles Taylor plc for the year ended 31 December 2013, but is derived from those statutory accounts, which have been prepared in accordance with International Financial Reporting Standards (IFRSs) and also in accordance with IFRSs adopted by the European Union and therefore they comply with Article 4 of the EU IAS Regulation.

Statutory accounts for 2012 have been delivered to the Registrar of Companies and those for 2013 will be delivered following the Company's Annual General Meeting.

The auditors have reported on those accounts; their reports were unqualified, did not draw attention to any matters by way of emphasis without qualifying their report and did not contain statements under s498 (2) or (3) Companies Act 2006.

Adoption of new and revised IFRSs - IAS 19R

IAS 19 (revised 2011) and the related consequential amendments have impacted the accounting for the Group's defined benefit scheme, by replacing the interest cost and expected return on plan assets with a net interest charge on the net defined benefit liability. For the year to 31 December 2012 the restated profit is £447,000 lower and other comprehensive income £447,000 higher than it would have been prior to the adoption of IAS 19 (revised 2011). As the Group has always recognised actuarial gains and losses immediately there has been no effect on the prior year defined benefit obligation.

2. Segmental information

Identification of segments

For management and internal reporting purposes the Group is currently organised into four operating businesses whose principal activities are as follows:

· Management Services business - mutual management service.

· Adjusting Services business - energy, aviation, non marine and marine (including average) adjusting.

· Insurance Support Services business - non-life and life insurance support services, including captive management, investment management and risk management.

· Insurers in Run-off business - non-life and life insurance companies closed to new business.

Management information about these businesses is regularly provided to the Group's chief operating decision maker to assess their performance and to make decisions about the allocation of resources. Accordingly, these businesses correspond with the Group's operating segments under IFRS 8 Operating Segments. Businesses forming part of each business which might otherwise qualify as reportable operating segments have been aggregated where they share similar economic characteristics and meet the other aggregation criteria in IFRS 8.

In the Management Services business, a higher proportion of revenue arises in the second half of the financial year. There is no significant seasonality or cyclicality in the other businesses.

Measurement of segmental results and assets

Transactions between reportable segments are accounted for on the basis of the contractual arrangements in place for the provision of goods or services between segments and in accordance with the Group's accounting policies. Reportable segment results and assets are also measured on a basis consistent with the Group's accounting policies. Operating segment profit includes an allocation of central costs across the four businesses and excludes non-recurring adjusting items. The prior year operating segment profits and assets have been adjusted to conform to the current year's presentation. Reconciliations of segmental results to the Group profit before tax are set out below.

Information about major customers

The Group derived revenue of £29.8m (31 December 2012: £28.7m) from one external customer which accounts for more than 10% of Group revenue, and is included within the Management Services business.

2012 figures have been restated for IAS19R.

* Excluding deferred tax.

3. Earnings per share

Earnings per ordinary share have been calculated by dividing the profit on ordinary activities after taxation and non-controlling interests for each year by the weighted average number of shares in issue. The shares held by the ESOP have been excluded from the calculation because the trustees have waived the right to dividends on these shares.

The calculation of the statutory basic, statutory diluted and adjusted earnings per share is based on the following data:

2012 figures have been restated for IAS19R.

4. Acquisition of subsidiaries

Noble Inspection and Loss Adjustment Company

On 29 August 2013, the Group acquired 60% of the issued share capital of Noble Inspection and Loss Adjustment Company (renamed Charles Taylor Adjusting (Saudi Arabia) Limited) and the Group is entitled to 70% of the profits. The business offers loss adjusting services in the Kingdom of Saudi Arabia, building on the Group's existing capabilities in the United Arab Emirates and Qatar.

The business contributed £0.4m revenue and £0.1m loss before tax to the Group since the acquisition date.

KnowledgeCenter

On 5 September 2013, the Group acquired the business and assets from KnowledgeCenter Limited. KnowledgeCenter is a provider of tailored business solutions to the insurance industry based on its business process management and document management software applications. The business provides the Group with a competitive advantage on key technology products and processes which it can combine with its own service provision, and will trade as Charles Taylor KnowledgeCenter Limited.

The business contributed £0.6m revenue and £0.4m loss before tax to the Group since the acquisition date.

If the acquisitions had been completed on the first day of the financial year the combined revenue for the Group and statutory profit before tax would have been £115.1m and £6.5m respectively. The amounts recognised in respect of the identifiable assets acquired and liabilities assumed are as set out in the table below:

5. Trade and other receivables

6. Trade and other payables

7. Borrowings

8. Note to the Cash Flow Statement