Final Results

Cpl Resources plc

Results for the Full Year Ended 30 June 2011

Dublin, 14 September 2011: Cpl Resources plc (the 'Group' or the 'Company'), Ireland's leading employment services group, today announced results for the year ended 30 June 2011.

Full Year Highlights

" Strong full year operating performance

" 24% increase in revenue to €235 million

" 81% increase in operating profit to €7.2 million

" Earnings per share increased by 57% to 19.2 cent

" Final dividend per share of 2.5 cent delivering total dividend per share of 5 cent (2010: 4 cent)

" 41% increase in operating cash flow to €5.6 million

" Strong balance sheet with 7% increase in net cash to €46 million

John Hennessy, Chairman commented:

"I am very pleased to report that in the year ended 30 June 2011 the Cpl Group delivered a strong operating performance and recorded significant increases in revenues and profits. The Group is cash generative and, despite increased working capital requirements in the period, generated operating cash flow of €5.6m. Cpl has a strong balance sheet, with an increased year-end net cash balance of €46.3 million."

Mr Hennessy added:

"The Board has determined that, given the strength of the balance sheet, and taking account of continued positive cash flow generation, a return of surplus capital is in the best interests of shareholders as a whole. Subject to shareholder approval, we intend to return up to €20 million of surplus capital, in the form of a Tender Offer, to shareholders."

Conference Call

Cpl Resources will host a conference call, for institutional investors and analysts, at 10.00am BST today, 14 September, 2011. For conference call dial in details please contact Jenny Kilroy of FD K Capital Source at: [email protected] or +353 1 663 3683.

For Further Information:

Anne Heraty, CEO, CPL Resources: +3531 614 6000

Josephine Tierney, Finance Director: +353 1 614 6000

Ivan Murphy, Davy Corporate Finance: +353 1 679 6363

Jonathan Neilan, FD K Capital Source: +353 1 663 3686

Jenny Kilroy, FD K Capital Source: +353 1 663 3683

Cpl Resources Plc

Chairman's statement

I am very pleased to report that in the year ended 30 June 2011 the Cpl Group ('Cpl' or the 'Group') delivered a strong operating performance and recorded significant increases in revenues and profits.

These results have been achieved at a time of prolonged economic uncertainty in Ireland and in other markets in which we operate. This uncertainty and its effects on employment and on business confidence generally have given rise to difficult trading conditions. We have continued to experience significant pressure on prices and margins. We are also conscious that both employers and job candidates are adopting an understandably cautious approach before deciding to offer or seek new positions.

Full Year Highlights

Against this background the Group's performance in the year to 30 June 2011 has been strong. We have concentrated our efforts on meeting the changing needs of companies and candidates, while managing our own cost base carefully. These efforts have resulted in a 46% increase in fees from permanent placements, and a 22% increase in net fees from the placement of temporary employees. Great credit is due to all of our people for achieving these results.

Over recent years the Group has reacted quickly to the changing economic landscape and we have focused on realigning our costs without affecting the quality of the service we give to our clients. It is encouraging to see the results of these efforts, for example through the improvement in the ratio of operating profit to gross profit, from 14.1% in 2010 to 19.4% in the year to 30 June 2011.

During the year under review we successfully integrated the Servisource business. We also acquired PHC care management ltd. and Runway personnel ltd. during the year. These acquisitions represent a further step in Cpl's strategy of extending the Group's footprint in the healthcare sector, and will enhance Cpl's position as the leading provider of healthcare professionals in the market.

I am also pleased to record the continued profitable growth in our businesses outside Ireland. We now operate in 9 countries and our operations in those countries are performing well and continuing to grow.

The achievement of strong results and the maintenance of positive momentum in such uncertain times reflect a truly outstanding commitment to the provision of excellent service across the whole group. On behalf of the Board I would like to thank the management and staff of Cpl, in Ireland and overseas, for all of their efforts. I would also like to extend the appreciation of the Board to our customers for their continued loyalty and support.

The Group is cash generative and, despite increased working capital requirements during the period, with cash generated from operations of €5.6m for the full year. Cpl has a strong balance sheet, with an increased year-end net cash balance of €46.3 million.

Dividend & Dividend Policy

The Board is recommending a final dividend of 2.5 cent per share. This will bring the total dividend for the year to 5 cent per share. The dividend, if approved by the shareholders, will be payable on 14 November 2011 to shareholders on the company's register at the close of business on the record date of 14 October, 2011. The Group has a progressive dividend policy which reflects underlying earnings growth and the continued strength of the Group's balance sheet.

Tender Offer

In recent months, the Board has considered a range of strategic and financial options to enhance shareholder value, particularly taking account of the continued generation of positive cash flows by the Group. Cpl is a profitable, cash generative group and is not a capital intensive business.

Following careful consideration and having taken appropriate advice, the Board has determined that a return of surplus capital is in the best interests of the shareholders as a whole. The Board believes that a return of capital represents the most effective use of those excess funds, and that the continued strength of Cpl's balance sheet, and its cashflow generation, are more than sufficient to allow the Group to achieve its objectives over the foreseeable future.

Consequently, subject to shareholder approval, we intend to return up to €20 million of surplus capital, in the form of a Tender Offer, to shareholders. A Tender Offer provides all shareholders with choice (that is, the discretion to participate) and certainty of value. Those shareholders who do not wish to participate can retain their full existing investment in the company. As all shares bought back by the Group will be cancelled, the Tender Offer is expected to have a positive effect on our earnings per share and dividend per share measures. The Group's progressive dividend policy is also unaffected by the proposed return of capital to shareholders.

Outlook

Although the economic and financial difficulties that have presented themselves in recent years have affected some markets and industries more than others, no individual or business has been immune to their effects. We still expect that markets will take considerable time to recover and we are cautious about the future. However, there are some positive signs emerging in the markets we serve. As a consequence, we expect that our continued efforts to grow our business while controlling costs will allow the Group to enjoy some further profitable growth in the 6 months to 31 December 2011. The continued uncertainty in the economy generally, however, makes it impossible to make any useful forecast of trading conditions and performance beyond that date.

John Hennessy

Chairman

14 September 2011

Cpl Resources Plc

Chief Executive's review

I am pleased to report that Cpl has marked its 21st year of working with people to advance their careers. During the year to June 2011, we placed over 4,000 people in permanent jobs and over 18,000 people in temporary and long term assignments. Despite the challenging labour market conditions, we finished the year with 5,925 people working on behalf of Cpl on client projects. This was 1,245 more people at work than in June 2010. As with any service business, the key ingredient to Cpl's success is our people. Our ability to compete in local and international markets for new assignments is as a result of their skills, talent and innovation. The flexibility and commitment of our staff underpins the increase in our revenue by 23.9% to €235.3 million, the increase in operating profit by 81.3% to €7.2 million and the increase in net cash by €2.9 million to €46.3 million.

Economic activity continued to decline in Ireland during the year to June 2011, marking the third successive year of contraction. The Irish labour market has been particularly hard hit by the recession and the numbers unemployed remained high throughout the year. Given that recovery in the Irish labour market typically lags that in overall economic activity, employment is forecast to record a further decline in the year to June 2012. However, the pace of this decline should be significantly weaker than in previous years. Employment is then expected to rise moderately in 2012-2013, with the projected pace of recruitment expected to accelerate over the forecast horizon as economic activity strengthens and broadens. Net employment creation of around 100,000 is foreseen over the period 2012-15, following a decline of over 300,000 between 2008 and 2011.

Demand for our services strengthened during the year to June 2011 and certain sectors showed some resilience. It appears that a two speed economy has developed, with certain sectors such as technology witnessing skills shortages whilst other sectors, such as construction, continue to offer very few job opportunities. Our Information Technology recruiting division bounced back strongly during the year with strong demand for engineers with internet and software skills. Our finance and accounting division, Careers Register, had a strong performance in the second half of the year to June 2011 as demand for qualified accountants across many different disciplines increased. Our international businesses delivered a strong performance, particularly in the permanent placement sector. We are encouraged by this increase in demand for our services; however, we are acutely aware of the uncertainty arising from the ongoing volatility in the current economic environment and the impact that this has on the labour market and job creation. We continue to focus on the quality of the service we provide while actively managing our cost base.

Financial Highlights

The Cpl Group increased its revenue by 24% to €235.3 million in the year to June 2011 (2010: €189.9 million). Gross profit increased by 31% to €37.0 million (2010: €28.2 million). The Group's gross margin improved by 0.8% to 15.7% (2010: 14.9%). Our EBIT increased by 81% to €7.2 million (2010: €4.0 million). Profit before tax was up 54% at €8.1 million (2010: €5.3 million). Our earnings per share was 19.2 cent (2010: 12.2 cent).

Our operating expenses were €29.9 million, 23% higher than last year. As our performance improved throughout the year we invested in hiring skilled people, in staff training and in our IT systems. At year end we had increased our internal staff numbers by 81 from the previous year. We continue to balance cost management with the need to invest in the future.

During this period, we paid our shareholders an interim dividend of 2.5 cent per share. The Board is recommending a final dividend of 2.5 cent per share for the year to June 2011. The total dividend per share for the year is 5 cent.

As at 30 June 2011 we had a net cash balance of €46.3 million. (2010: €43.5 million). Our business remains cash generative. We generated strong cash flow of €5.6 million from operations in the full year, a 41% increase on the prior year. This increase is despite the increased working capital required to fund the strong growth in revenues during the period.

We paid out €1.2 million on acquisitions, net of cash acquired. We paid out €1.9 million in dividends. Cpl is a service business and is not capital intensive. Our debtor balance is an important asset. As at 30 June 2011 our trade debtor balance was €29.6 million (2010: €23.1 million). The increase in our trade debtor balance is as a result of our increase in revenue. Despite the uncertain economic environment we continue to actively manage our debtors and have not experienced any significant increase in the level of bad debts during the year.

Key Performance Indicators

We increased our gross margin by 0.8% to 15.7% in the year to June 2011. We increased our margin on temporary business to 11.4% (2010: 11.2%). This is an excellent achievement, particularly when we take into account the demands from clients for cost reducing measures and lower margins. The main contributor to the increase in our gross margin is the growth in permanent fees, which now account for 30.8% of the total gross profit (2010: 27.7%).

One of our stated objectives last year was to improve our operational leverage. We achieved this in the year to June 2011 by converting 19.4% of our gross profit to EBIT (2010: 14.1%). Despite our strong cash conversion, our interest income declined by 28% due to lower interest rates. However, we still managed to improve our conversion ratio of gross profit to PBT to 22.0% compared to 18.8% last year.

On the back of strong revenue growth we achieved a significant improvement in our operating margin to 3.1% in the year to June 2011, up from 2.1% in the year to 30 June 2010.

Operational Review

Cpl is a successful company with a strong balance sheet which has grown over the last 21 years both organically and through acquisition. We provide recruitment and workforce solutions in each of the geographic markets in which we operate. We continue to build on our established and deeply rooted long term customer relationships and upon our ability to attract and retain the best people for our business. Cpl offers a diverse range of services to over 1,500 clients each year. These services can be broadly categorised as temporary staffing, permanent recruitment, managed services and outsourcing.

Our recruitment business breaks down into professional/specialist and generalist recruitment. Professional/specialist recruitment is a significant part of the Cpl business and operates under a number of different business lines. These can be broadly categorised as Information Technology (IT), Finance and Accounting, Engineering & Science, Sales & Marketing, Contact Centre, Human Resources (HR) and Healthcare. These business lines have the potential to generate additional revenues and margins going forward, particularly in sectors where there are skills shortages. Our generalist business is a lower margin business and cost is often a major factor in successful tenders.

Our managed services and outsourcing business is the platform which we use to deliver a wide range of services that help clients source staff and manage their workforce in an efficient and flexible manner. The services provided by these divisions include Recruitment Process Outsourcing (RPO), Managed Staffing, Contact Centre Outsourcing, Career Transition and Training. We expect that this business platform will be a key driver of growth for Cpl as clients look for greater flexibility, operational efficiencies and cost savings from their workforce.

Strategy

Our strategy is to focus mainly on organic expansion, while using selective acquisitions to build business platforms in new sectors or markets which offer good long term growth potential. Our strategy is based on the following goals:

1. Build a profitable, cash generative business with good predictability in earnings.

2. Increase Cpl's organisation capacity:

o Attract and retain key skills and talent

o Develop world class business processes underpinned by effective IT systems

o Increase productivity

3. Build a balanced portfolio of businesses, service lines and customers

o Deepen our presence in existing sectors in Ireland and open up new sectors

o Replicate our existing business model in new geographies

o Build new business models in attractive sectors

Permanent Placement

While the numbers in employment have fallen against the backdrop of a sharp decline in activity, the level of employment remains relatively high from a historical perspective. At the end of 2010 there were 1.8 million people at work in Ireland compared to around 1.2 million in the early to mid-1990s. Employment is anticipated to increase once economic growth resumes. The pace of annual employment growth is expected to strengthen in the coming years, from 0.5% in 2012 to around 2% a year by the end of the forecast horizon. By 2015 the proportion of the population in employment is forecast to be around 45%, below the peak of 50% reached in 2007, but well above the level of circa 33% recorded in the late 1980s. Permanent placement is particularly sensitive to economic growth and we were particularly pleased to see an improvement in our permanent recruitment business, albeit off a very low base. We attribute this to the severity of job cuts as the recession progressed. Employers simply cut too deeply and now need to hire new staff again in certain skill-specific areas.

In the year to June 2011 permanent fees increased by 46% to €11.4 million (2010: €7.8 million). This reverses the 36% fall in the year to June 2010. We continue to work closely with our clients and the success of all organisations is often based on the quality of the individuals that they hire. Through the recession many companies cut costs and redefined their processes to achieve efficiencies. Now companies are realising how important it is to have the right person in the right role to ensure the long-term success of the organisation.

Temporary Staffing

In the current uncertain economic environment, we continue to see good demand from our clients, who value the flexibility we offer in terms of workforce solutions. The economic downturn instigated a structural shift towards the increased use of temporary staffing in office, industrial and professional segments and has proved the value of utilising a more flexible workforce. Companies with a higher share of temporary employees were better able to respond quickly to the issues presented by a sudden drop in demand. We believe that the penetration of temporary staffing solutions will increase and reach new peaks in many mature and emerging markets. Employers can now only afford to hire as improved demand for their product or service presents itself. Companies are grappling with new market challenges and we believe that this will create an unprecedented need for on-demand staffing solutions.

Our business is about matching companies and candidates. It's about understanding people. Last year, our experts placed around 18,000 candidates into temporary assignments. Cpl has a philosophy to excel when it comes to efficient service delivery. We are flexible in our approach, results-orientated and focused on service delivery to both clients and candidates. We want candidates to experience the difference we can make in their career journey. We are helping people get back to work. We help our clients and candidates work in a new way, unleashing the potential of the workforce and redefining how work gets done.

Fees generated from temporary assignments continued to grow in the year to June 2011. Temporary revenue was €223.9 million (2010: €182.0 million) representing 23% growth. We generated €25.6 million gross profit, 26% higher than the year to June 2010. We also increased our gross margin slightly to 11.4% (2010: 11.2%).

Overseas business

We continue our strategy to diversify our revenue base and reduce our dependence on the Irish economy. 33% of our permanent fees now come from outside of Ireland. We have also secured some significant client wins in the year and hope to continue to expand our managed service offerings outside Ireland. We opened new offices in Wroclaw in Poland and in Sofia in Bulgaria consistent with our objective to replicate our business model in new markets. We are focused on organic growth in central and Eastern Europe as we believe many of these markets are still in the early stage of growth. We are also starting to gain traction in our temporary placement business as labour markets in these geographies liberalise.

Legal environment

The crucial role played by temporary staffing solutions in EU labour markets and its impact on job creation and in providing opportunities which accelerate the pace of return to work for those who are unemployed was recognised in the OECD's 2011 Economic Outlook paper. Many of the European Labour markets are highly regulated and there has been a move over the last decade to liberalise some of these markets to facilitate job creation. For example in 2000, Italy opened up its agricultural, construction and public sectors.

Temporary staffing legislation varies by market. All EU Member States are required to transpose the EU Directive on Temporary Agency Work (2008/104/EC) into national law by December 2011. The Directive is designed to ensure that workers employed through an employment agency are given the same terms and conditions as comparable permanent employees doing the same or similar work in an end user company. At this time it is unclear what impact the legislation will have on temporary work or how it will work in practice.

Acquisitions

Cpl continues to deliver on the objective of deepening our presence in existing sectors in Ireland. This enables us to consolidate our position in a sector and then drive organic growth. In the year to June 2011 we acquired PHC Care Management Limited and Runway Personnel Limited. Both are small businesses that provide multiple types of recruitment and related staffing solutions to the healthcare sector, to public and private hospitals, care homes and allied health facilities. They also provide long term employment solutions, traditional nursing agency services, short term/agency positions for healthcare assistants and allied health professionals, managed occupational health or in-house nursing support services, chronic illness management in the home or primary healthcare settings. Both of these acquisitions have been fully integrated into the Cpl Group and have provided us with an enhanced platform from which to provide additional services to our existing customer base.

People

The performance of Cpl during 2011, particularly revenue growth, cash generation and improved operational leverage demonstrated once again a level of operational excellence which is a hallmark of the strength, depth and resilience of our management and staff. I thank all Cpl employees for their contribution and continued commitment to the success of the Group.

Performance review and outlook

In the past year, we have delivered on each of our strategic objectives. We have delivered enhanced profitability and strong cash generation. We have continued to enhance our organisational capacity and strengthen our portfolio of businesses, our service lines and our customer base.

The short term economic trends indicate that we face a period of continued uncertainty and volatility. We intend to adopt a cautious approach and are cognisant of the impact such market conditions can have on our business. However, Cpl has demonstrated its resilience in these market conditions and we intend to move forward from a position of strength. Our focus will be to look for opportunities in those sectors and geographies that are doing well, while continuing to effectively manage our core business. Our client base and the quality of our client and candidate relationships is one of our strategic advantages. Our management and services delivery teams are committed to delivering efficient, innovative and flexible staffing solutions to our clients. We believe companies now recognise the benefits of a flexible staffing model, particularly in a constantly changing business and economic environment and we believe that this should present new opportunities for Cpl.

Anne Heraty

Chief Executive

14 September, 2011

Proposed Tender Offer

The Board is proposing to effect a return of up to €20 million of cash to its shareholders, by means of a tender offer (the "Tender Offer").

Background to and reasons for the proposed Tender Offer

As set out above, in the year to 30 June 2011, the Group reported progress against all financial and operating measures. A strong operating cash flow performance within the period increased Cpl's net cash balance from €43.4 million to €46.3 million.

Throughout 2011, the Board considered a range of strategic and financial options to enhance shareholder value. The Board, in consultation with its advisers, reviewed a number of factors including:

·; The Group's current and expected capital requirements relative to the strength of its balance sheet together with its ongoing cash flow generation;

·; The interest income generated by the Group's current cash balance; and

·; Acquisition opportunities.

Following this review, and having regard to the views of certain institutional shareholders that had made unsolicited approaches relating to a potential return of capital to shareholders, the Board (with the exception of Anne Heraty and Paul Carroll, who absented themselves from deliberations relating to the proposed Tender Offer) unanimously determined that a return of surplus capital is in the best interests of shareholders as a whole. The Board believes that a return of capital represents the most effective use of shareholder funds and that the continued strength of Cpl's balance sheet, and its cashflow generation, are sufficient to capitalise on the Group's stated growth objectives.

The Board concluded, following consultation with the Company's advisers, that a return of up to €20million of capital by way of the Tender Offer is in the best interests of the Group and shareholders as a whole as it provides shareholders with both choice (that is, the discretion to participate) and certainty of value. Those shareholders who do not wish to participate in the Tender Offer can retain their full existing investment in the Company. As all shares bought back by the Group will be cancelled, the Tender Offer is expected to have a positive effect on both the Group's earnings per share and dividend per share measures.

An independent committee of the Board, comprised of independent non-executive directors Breffni Byrne and Oliver Tattan, was formed to consider and settle the terms and conditions, including price, of the Tender Offer.

Tender Offer

The Tender Offer will be made to shareholders at a proposed price per share of €3.00 (the "Tender Price"). The Tender Price represents a premium of 20 per cent. to the Closing Price of €2.50 on 13 September 2011 (being the latest practicable date prior to this announcement) and represents a premium of 12.8 per cent. to the volume weighted average price over the three month period to 13 September 2011 (beingthe latest practicable date prior to this announcement).

The Company intends to purchase, in aggregate, up to 6,666,666 Ordinary Shares from shareholders at the Tender Price. It is the Company's intention to cancel these Ordinary Shares. Each shareholder will have a guaranteed entitlement to participate in the Tender Offer in respect of approximately 17.91 per cent of his shareholding, rounded down to the nearest whole number.

The Board reserves the right at any time prior to the anticipated completion of the Tender Offer and having regard to prevailing market conditions, to (i) vary the Tender Price; and/or (ii) change the maximum number of Ordinary Shares that can be tendered pursuant to the Tender Offer; and/or (iii) not proceed with the Tender Offer; if they conclude that the implementation of the Tender Offer at the Tender Price is no longer in the best interests of the Company and/or its shareholders as a whole.

Each of the Directors has irrevocably committed to participate in the Tender Offer on a pro rata basis.

Shareholder Approval

The Tender Offer will be subject to approval by Cpl's shareholders at an Extraordinary General Meeting ("EGM"). A notice of EGM together with additional explanatory documentation setting out further detail with regard to the background to and reasons for, the terms and conditions of and instructions on how to participate in, the Tender Offer will be sent to shareholders in due course.

Benefits of a Tender Offer

The benefits of a Tender Offer, compared to other available options for a return of capital to Cpl shareholders, are that a Tender Offer:

a) provides those shareholders who wish to sell Ordinary Shares with the opportunity to do so;

b) enables those shareholders who do not wish to receive capital at this time to maintain their full investment in the Company;

c) is available to all shareholders (other than shareholders who may be resident in certain prohibited territories) regardless of the size of their shareholdings;

d) ensures equal opportunity to all shareholders to participate in the return of capital by offering a pro-rata return of capital to all shareholders; and,

e) has a sustainable positive impact on both the Group's earnings per share and dividend per share as all shares acquired under the Tender Offer will be cancelled.

Cpl Resources Plc

Group Statement of Comprehensive Income

for the year ended 30 June 2011

Cpl Resources Plc

Group Statement of Changes in Equity

for the year ended 30 June 2011

Cpl Resources Plc

Company Statement of Changes in Equity

for the year ended 30 June 2011

Cpl Resources Plc

Group and Company Balance Sheets

as at 30 June 2011

Cpl Resources Plc

Group and Company Balance Sheets (continued)

as at 30 June 2011

Cpl Resources Plc

Group and Company Cash Flow Statements

for the year ended 30 June 2011

Cpl Resources Plc

Group and Company Cash Flow Statements

for the year ended 30 June 2011 ( continued)

Cpl Resources Plc

Notes

1 Operating segment reporting

Segment information is presented in respect of the Group's operating segments. Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be allocated on a reasonable basis. Cpl's primary activity is recruitment. The Group's operations are divided into:

·; Recruitment of temporary staff

·; Permanent placement of candidates

Information regarding the results of each operating segment is included below. Performance is measured based on segment profit before income tax, as included in the internal management reports that are reviewed by the Board.

1 Operating segment reporting (continued)

At 30 June 2011, centrally controlled assets constitute cash and cash equivalents of €38.4 million

(2010: €43.5 million) and short term bank deposits of €8 million (2010: €nil).

2 Financial income and expenses

3 Statutory and other information

Group

Profit before tax is stated after charging the following:

In accordance with the requirements of Regulation 120 of Statutory Instrument 220 / 2010, 'European Communities (Statutory Audits) (Directive 2006/43/EC) Regulations 2010', the auditor's remuneration figures represent fees paid to KPMG Dublin only and are exclusive of VAT. Audit services relates to the audit of the Group financial statements only. Audit fees in relation to the audit of subsidiary companies by KPMG Dublin are classified as other assurance services. Audit fees paid to other KPMG offices, not included above, amounted to €8,500 (2010: €8,000).

4 Staff numbers and costs

Staff numbers

The average number of persons employed by the Group (excluding directors) during the year, analysed by category, was as follows:

Number of employees

Staff costs (excluding directors)

The weighted average number of persons employed by the Company (comprising the executive directors) during the year was four (2010: four).

5 Income tax expense

Reconciliation of effective tax rate

6 Dividends to equity shareholders

Interim dividends to equity shareholders in Cpl Resources Plc are recognised when the interim dividend is paid by the Company. The final dividend in respect of each financial year is recognised when the dividend has been approved by the Company's shareholders. During the financial year, the following dividends were recognised:

The directors have proposed a final dividend in respect of the 2011 financial year of 2.5 cent per ordinary share. This dividend has not been provided for in the Company or Group balance sheet as there was no present obligation to pay the dividend at the year end. The final dividend is subject to approval by the Company's shareholders at the Annual General Meeting.

7 Earnings per share

8 Profit for the financial year

As permitted by Section 148(8) of the Companies Act, 1963, a separate income statement for the Company is not presented. The profit for the financial year of the holding Company was €21,030,000 (2010: €4,100,000). The increase on prior year represents dividends received from subsidiary undertakings.

9 Property, plant and equipment - Group

Included in motor vehicles are assets with a net book value of €51,875 (2010: €86,000) which were acquired under finance leases.

10 Goodwill and intangible assets

Group

10 Goodwill and intangible assets (continued)

Goodwill

Goodwill arises in connection with business combinations and has been allocated to Cash Generating Units (CGUs) for the purpose of impairment testing. A CGU represents the lowest level within the Group at which associated goodwill is monitored for management purposes and is not bigger than the segments determined in accordance with IFRS 8, Operating Segments.

The Group tests goodwill annually for impairment or more frequently if there are indications that goodwill might be impaired. The recoverable amounts of CGUs are based on value in use calculations.

Key assumptions used in the value in use calculations

The key assumptions in the value in use calculations used to assess impairment are outlined below:

These calculations use cash flow forecasts based on expected future operating results and cashflows and exclude incremental profits derived from acquisition activities. The computations use five year forecasts. For individual CGUs, one year forecasts have been approved by senior management. The remaining years' forecasts have been extrapolated using growth rates of between 0% and 2% based on the current operating results and budgeted performance of individual CGUs. For the purposes of calculating terminal values, a terminal growth rate of 0% has been adopted. The cashflow forecasts are discounted using appropriate risk adjusted discount rates averaging 10.5% (2010: 10.77%), reflecting the risk associated with the individual future cash flows and the risk free rate.

Any significant adverse change in the expected future operating results and cash flows may result in the value in use being less than the carrying value of a CGU and would require that the carrying value of the CGU be stated at the greater of the value in use or the recoverable amount of the CGU.

Impairment losses

Applying the techniques and assumptions outlined above, no impairment losses arose in the years ended 30 June 2011 and 30 June 2010.

The results of impairment testing undertaken provide sufficient headroom such that any reasonable realistic movement in any of the underlying assumptions would not give rise to an impairment charge on the relevant CGUs.

Brands, customer contracts and databases, and software

Intangible assets comprise brands and customer contracts and databases which were acquired as part of the acquisitions made by the Group. The brands and customer contracts and databases were assessed as having a maximum finite life at their respective dates of acquisition of 5 years. During the year, the brands and customer databases have been amortised over their estimated useful lives. The amortisation has been recorded in administration expenses within the Group income statement.

Software assets are amortised over their estimated useful life of 5 years.

11 Deferred tax assets and liabilities

Group

The movement in temporary differences during the year was as follows: