Half Yearly Report

ISG PLC

("ISG" or "the Group")

Interim results for the period ended 31 December 2014

Results impacted by performance of older contracts in UK Construction division

Strong performance from UK Fit Out and Engineering Services, UK Retail and International

Equity fund raising undertaken of £16m

ISG plc, the international construction services group, today announces its interim results for the period ended 31 December 2014.

1from underlying items and continuing operations (Notes 3 and 4)

2restated for the classification of the Tonbridge operations as discontinued operations (Note 6)

3restated for the classification of the London Exclusive Residential operations as a business to be discontinued within non-underlying items (Notes 1 and 4)

4from earnings attributable to owners of the company from underlying items (Note 8)

5from earnings attributable to owners of the company (Note 8)

Group Highlights

· Strong performances from UK Fit Out and Engineering Services, UK Retail and International divisions

· UK Construction division generated a loss of £16.0m as a result of provisions and losses on contracts entered into more than 18 months ago, but now stable with better contracts secured

· Order book in line at £967m (2013: £968m), of which £655m is for delivery in current year (2013: £641m). Since period end £148m of data centers business secured

· Net cash balance of £38.3m at 31 December 2014 (2013: £33.3m)

· Fund raising of £16m undertaken with institutional investors to strengthen equity base

· Interim dividend passed; in the absence of unforeseen circumstances, the Board expects to pay a final dividend of 4.91p (final 2014: 4.91p)

David Lawther, Chief Executive Officer, said:

"We have taken decisive steps to reform our UK Construction division and the issues caused by older contracts will be closed out. Higher quality and larger contracts are now in progress.

Elsewhere, our UK Fit Out and UK Retail businesses continue to lead their markets and perform very well. We plan further progress for our Engineering Services business as it continues to build its reputation across Europe. Overseas, we are capitalising on increased market activity and a growing reputation.

As previously flagged, we expect the operational performance of the Group in the second half to be in line with the Board's expectations. We anticipate returning to our previously expected growth path in 2015/16."

3 March 2015

ENQUIRIES: 

CHIEF EXECUTIVE OFFICER'S STATEMENT

Our results for the six months to December 2014 have been affected by issues in our UK Construction division with outperformance in our other businesses. The issues faced in UK Construction principally relate to the deterioration in project performance since 30 June 2014 on contracts procured over 18 months ago, the closing out of contracts in discontinued operations and losses within our London Exclusive Residential business which has been identified as a business to be discontinued. Also, within this division, the Group has been in protracted negotiations on one large construction contract entered into in 2012, and decided to make a significant provision against this contract at the half year. Since the trading update we have concluded a settlement agreement with the client within the level of the provision made at the half year.

Looking beyond our UK Construction operations, our businesses have delivered improved performance in the period. Demand for our Engineering Services offer continues to grow with further major commissions for data centers across Europe. We have also maintained our leadership position in the London Fit Out and UK Retail markets. In Asia and the Middle East, we continue to see significant growth, and in Continental Europe, our recent acquisitions in Spain have provided a positive contribution in their first period as part of the Group.

Results from Underlying Operations

1 Restated for the classification of the Tonbridge operations as discontinued operations (Note 6)

2 Restated for the classification of the London Exclusive Residential operations as a business to be discontinued within non-underlying

items (Note 4)

3 International comprises the summation of our Continental Europe, Middle East and Asia reportable segments

For the six months ended 31 December 2014, revenue increased by 20% to £819m (2013: £682m1,2) with strong growth in our UK Fit Out and Engineering Services and UK Retail divisions. As a result of the negative impact of our UK Construction division, the Group has incurred an underlying loss before tax of £7.2m (2013: profit £7.8m1,2). Underlying basic earnings per share for the period is (15.01p) (2013: 15.47p1,2).

Net cash inflow from operating activities from continuing operations for the period stood at £1.2m (2013: £8.4m1,2).

Exceptional costs from Non-Underlying Items and Discontinued Operations

The Group has identified its London Exclusive Residential activities as a business to be discontinued and full year losses of £6m are forecast. Losses of £7m have been recognised at the half year within non-underlying items. In addition the Group is making further provisions for increased losses of £11m related to the closure of its Tonbridge business and associated contracts announced last year. Further details of these items are set out below.

Results for the period

The loss for the period from continuing and discontinued operations for the Group is £20.8m (2013: profit £1.7m1,2).

Order book

At the end of December 2014, our total order book was in line with prior year at £967m (2013: £968m), of which £655m (2013: £641m) is for delivery in the current financial year and £273m (2013: £289m) for the next financial year. Since period end, we have announced the securing of two data centers in Western Europe with a combined value of £148m.

Fund raising

The Company has today announced that it intends to raise £16m by way of an equity fund raising of 9,411,765 new ordinary shares at a price of 170 pence per share with institutional shareholders. In addition, the Company has granted its broker an option to issue on similar terms to the fund raising up to an additional 1,764,706 new ordinary shares to meet any further demand from other investors, thereby generating gross proceeds of up to £3m. The Company has undertaken this fund raising due to the impact of the losses and provisions in UK Construction announced in the trading update and in these interim results. Given most of these losses are unlikely to be recovered the Board believes it is in the interests of all shareholders that the equity capital base of the Group should be strengthened, and it will provide additional resources during the seasonal low point of the Group's working capital cycle.

In addition the Board has negotiated an additional short term revolving credit facility (RCF) with its banks of £10m until 30 April 2015 (in addition to the existing £20m RCF that is in place), conditional upon completing the fund raising. The Group will incur additional costs of circa £1m in the second half relating to the fund raising and additional bank facilities.

The Board believes the fund raising will also allow the Group to continue to develop its Engineering Services and Consultancy businesses in the future.

Dividend 

The Board believes that in light of the losses incurred at the half year and the need to strengthen the Group's capital base the Company should not pay an interim dividend. The Board remains confident of its expectations of improved trading in the second half and in the absence of unforeseen circumstances expects to pay a final dividend of 4.91p (final 2014: 4.91p).

UK Construction

The Group has been restructuring its UK Construction division over the past 18 months in response to the widely reported difficult trading conditions in this market. This has involved strengthening management, improving procurement, bid and risk management and assessing the core strengths of each business region and refocusing accordingly. This restructuring has also assessed the long term viability of business units starting with the decision to close our Tonbridge operations in June 2014.

The trading update made on 2 February was a result of the completion of an internal contracts performance review within the UK Construction division (including the discontinued activities) in preparation for the Group's half year results undertaken by new management appointed late last calendar year. This review focused on the appropriateness of internal judgements and forecasts of contract recoveries. In particular, the review addressed up to date information in respect of projects that were procured more than 18 months ago when market conditions were less favourable, where there has been a deterioration in project performance since 30 June 2014 and on the financial close out of contract entitlements within previously discontinued operations.

The review evaluated the progress made in achieving final closure of the Tonbridge operations and concluded that our ability to collect sums due on the remaining projects within this business had been adversely affected. A substantial portion of the additional provision announced reflects a re-evaluation of the ultimate recoverability of project entitlements. All contractual entitlements continue to be vigorously pursued.

The review also concluded that the London Exclusive Residential construction activities should be discontinued as the rewards did not meet the division's new bid and risk management policies. The result in the period reflects the losses incurred in the year to date as well as the Board's assessment of the losses to close out the remaining contracts. There are five larger contracts in this division of which two have achieved practical completion and the remaining three are due to complete by the year end. The completion of these live contracts will be overseen by our London Fit Out division.

Performance from our continuing activities in UK Construction in the first half of the current year has been adversely affected by the recognition of a significant provision against a large construction contract entered into in 2012 and completed in 2014, where protracted commercial negotiations have been ongoing. Since the trading update we have concluded a settlement agreement with the client within the level of the provision made at the half year. In addition, the division has been impacted by the deterioration in project performance experienced in closing out three large contracts procured more than 18 months ago, of which one we have now achieved financial closure, and two will complete by the Group's year end. Excluding these older contracts, the division has been profitable reflecting the Group's restructuring and refocusing initiatives. The business has continued to focus on winning work from repeat customers and frameworks in its core sectors, and on reducing open market tendering. Contracts procured since the start of the financial year continue to be secured on significantly improved terms. Another key focus has been strengthening the management team and in the period, we appointed a new UK MD and a leader for the Northern Regional business.

Revenue in the period is slightly ahead of the previous year at £218m (2013: £208m1,2), the business made an operating loss on continuing operations of £16.0m (2013: profit £3.0m1,2), which includes the significant provision of circa £7m mentioned earlier and losses of £11m on the other three older contracts.

Projects are currently underway for repeat customers including a global beverage company, private equity firm Blackstone, and under frameworks for the North West Construction Hub and Suffolk County Council. Work continues on high-profile schemes for Amlin, Guy's and St Thomas' Hospital and Exhibition Centre Liverpool. Recent multi-million wins including the American School London, Kew Gardens' Temperate House and an expansion to an R&D campus for a leading technology company signify an improvement in pipeline and confidence.

The order book at December 2014 stands at £470m (2013: £482m) of which £236m (2013: £227m) is to be delivered in the current financial year. We anticipate the division returning to profitability in the next financial year.

UK Fit Out and Engineering Services

In the first half of the year, our UK Fit Out and Engineering Services division has continued to perform strongly, with improvement against every key metric. The improvement seen recently in the London office fit out market has been maintained, while our strategy to grow our Engineering Services offer continues to attract significant new contracts both in the UK and Continental Europe. Revenue is significantly up at £308m (2013: £210m) of which £159m (2013: £107m) relates to our overseas data center activity. Operating profit is also significantly up at £6.6m (2013: £3.0m).

After the return of larger scale office projects in the past year, the market now has a bias towards mid-sized projects and refurbishment. ISG continues to lead the London office fit out market and in the period major wins include a £25m fit out for a global technology customer in the fast-developing King's Cross creative quarter and a £30m project for a US-based financial services institution, ISG's tenth project for the customer.

Substantial fit outs underway include the new headquarters for UBS valued at £125m (London's largest office fit out in recent years), and a £25m project for Macmillan Publishing Group. In the period, we successfully completed the £52m refurbishment project of London's Aldwych Quarter for Japanese owners Kato Kagaku and the £60m fit out project for a leading international media group.

The business is also increasingly delivering in other major UK cities for repeat customers such as developer Oxford Properties, Deloitte and KPMG.

Our portfolio of data center projects continues to grow within the UK, the Nordics and across Western Europe. Following the successful delivery of our second Nordic data center project in August 2014, we have continued to strengthen our relationship with this global technology company where we secured during the period a fourth project as lead contractor. A further project is due to complete over the second half of the current financial year with further awards anticipated.

The first half of the year saw our growing Engineering Services business continue to make headway in the R&D and healthcare sectors. Wins this period include the Optegra Eye Hospital in central London and a refurbishment project for GlaxoSmithKline at their Stevenage site.

At 31 December 2014, our UK Fit Out and Engineering Services division's order book has increased to £296m (2013: £282m), of which £251m (2013: £254m) is to be delivered in the current financial year.

Since period end, we have secured two data centers in Western Europe with a value of £148m. We anticipate that revenue for the current financial year will be substantially ahead of the prior year.

UK Retail

Our UK Retail division has maintained its market leading position. Revenue for the period has increased by 16% to £180m (2013: £156m), with operating profit increasing by 17% to £3.8m (2013: £3.2m).

We continue to work on all the frameworks of the leading retail banking brands where we saw our revenues increase by 70% as a result of their continuing shift to an open, interactive, retail-style environment. Technology is a major driver of this change and, as the market leader, we are playing a pivotal role in helping customers with their portfolio strategies. During the period, we were appointed on a framework for a leading UK building society to undertake a major concept roll-out.

Our volumes in the food retail sector have been maintained despite the downward market trend and we remain a key supplier on the frameworks for Asda, Morrisons, Sainsbury's, Tesco, Marks & Spencer and Waitrose. Despite a move away from major new build schemes, the sector continues to present opportunities as the major brands look for new ways to innovate, improve efficiency and attract customers.

ISG has maintained performance in the high street fit out sector in a difficult market by securing work with new customers as well as maintaining existing relationships. New customers we have secured work with during the period include Home Retail Group, GAP and the Co-operative Group, where we have so far successfully delivered 15 refit projects and six acquisition projects as part of the latter's investment programme.

Realys, which provides project management services, continues to establish its footing in the UK having successfully completed its first year appointment for Barclays and the outlook remains very positive.

The order book for the business has remained in line with last year at £104m (2013: £102m) of which £88m (2013: £80m) is to be delivered in the current financial year. We anticipate that revenue for the current financial year will be ahead of the prior year.

Continental Europe

In Continental Europe, our performance is reflective of the markets in which we operate. The continued strength of the German economy, and recovery in Spain, have both helped to underpin strong performance in these geographies. However, France and Italy continue to lag the recovery and here market opportunity remains limited. Revenue in the period was £38m (2013: £53m) with operating profit at £0.7m (2013: £0.9m).

Germany remains a key focus and our strategy to target the major cities is paying dividends with significant recent wins in Munich, Stuttgart and Hamburg. Good progress is being made with the integration of our acquisition, Tecton Engineering GmbH, to provide a broader scope of services for our customers across Germany.

ISG has taken a significant step forward in the Spanish market with recent acquisitions Diadec and Emerald making a positive contribution in the first half.

In France and Italy, the retail and office markets are suffering in reflection of the current economic climate. However, we have completed projects for repeat customers including Louis Vuitton and a Size store for the JD Sports brand.

At 31 December 2014, the business had an order book of £30m (2013: £39m), of which £25m (2013: £34m) is to be delivered in the current financial year. We anticipate that revenue for the current financial year will be below the prior year.

Middle EastIn the Middle East where we are focused on commercial office fit out and hospitality fit out, we continue to see improvement in the performance of our business. Revenue has doubled at £26m (2013: £13m), with underlying operating profit improving to £0.6m (2013: £0.1m).

In Abu Dhabi, we continue to establish our market position having delivered a number of large commercial office fit out projects including the new HQ for the Abu Dhabi Tourism and Culture Authority. We have extended the offer from international clients to working with local clients such as Mubadala and the owners of major sporting and entertainment facilities on Yas Island.

In Dubai, our focus has been on hotel and hospitality refurbishment projects as a key growth sector. The refurbishment of the first phase of the Kempinski Hotel at the Mall of the Emirates has been completed and this project will continue throughout 2015. We have been active in the Dubai International Financial Centre, completing projects in the first half year and securing an important new project with Lloyds of London.

The forward order book remains steady at £28m (2013: £28m), of which £23m (2013: £23m) is to be delivered in the current financial year. We anticipate that revenue for the current financial year will be significantly ahead of the previous year.

Asia

We are starting to see improvement in the office fit out market, particularly in South East Asia. Looking forward, our activities will be more evenly spread between office, retail and hospitality sectors. Revenue for the half year was up at £48m (2013: £42m), with operating profits at £1.2m (2013: £1.1m).

Office fit outs were completed in South East Asia for repeat customers including BP, Google, Microsoft and Hogan Lovells with new projects secured for Standard Chartered Bank in Singapore as well as two international organisations in Malaysia. Completions for international retail brands included Tesco, with two large-scale supermarkets in Malaysia, the first store in South East Asia for Vera Wang Bride and a Christian Dior store. Our hospitality projects included refurbishments at Le Meridien and Four Points in Malaysia, and Level 55 at the Marina Bay Sands hotel and the Club Hotel in Singapore.

In North Asia, our success in the retail sector continued with repeat projects for customers including Dior, UGG, Hogan and Frey Wille. We also delivered our first projects in China for Alexander McQueen, Vivienne Westwood and Brazilian-based jewelers H.Stern. Hospitality projects include the completion of a restaurant for the Hong Kong Jockey Club, the completion of phase four and the award of phase five of a refurbishment at Hong Kong Disneyland and the refurbishment of several areas of the Langham Place Hotel in Mong Kok.

Our specialist solutions companies Commtech and Realys continue to attract demand for their services across Asia. Commtech's commissioning management assignments focused on data centers and commercial offices included working in China, Singapore, Manila, Riyadh, Japan, Taiwan, Hong Kong and Australia.

The Realys business secured numerous repeat commissions including Porsche in China, three international financial services organisations in Korea as well as projects for new clients including Qualipac, SABAF and Forever 21. Our Realys design and build service operating in Singapore which we established last year continues to grow its market presence.

The order book stands at £41m (2013: £35m) of which £36m (2013: £23m) is to be delivered in the current financial year. We anticipate that revenue for the current financial year will be ahead of the prior year.

Outlook

We have taken decisive steps to refocus our UK Construction division and the issues caused by older contracts will be closed out. The forward order book is characterised by better procured projects, repeat customers and frameworks in a limited number of market sectors that suit our skillset.

Elsewhere, our UK Fit Out business and our UK Retail division continue to lead the markets they operate in. The retail sector is likely to remain competitive while the office fit out market will be focused on refurbishment and mid-sized projects. We plan further progress for our Engineering Services business as it continues to build its reputation across Europe and attains its own market leadership position.

Our Middle East and Asia businesses are both capitalising on increased market activity and a growing reputation in the core sectors of office fit out, retail, and hospitality projects. In Continental Europe, continued uncertainty in the Eurozone will affect the market although we anticipate increased opportunity in Germany and Spain.

With the actions taken in UK Construction, we expect the operational performance of the Group in the second half to be in line with the Board's expectations. Thereafter the Board anticipates returning to our previously expected growth path.

David Lawther

Chief Executive Officer 

1 Restated for the classification of the Tonbridge operations as discontinued operations (Note 6)

2 Restated for the classification of the London Exclusive Residential operations as a business to be discontinued within non-underlying

items (Notes 1 and 4)

CONDENSED CONSOLIDATED INCOME STATEMENT

for the 6 months ended 31 December 2014

1 Restated for classification of the Tonbridge operations as discontinued operations (Note 6)

2 Restated for the classification of the London Exclusive Residential operations as a business to be discontinued within non-underlying items (Notes 1

and 4)

Non-underlying items include those which the Group believes should be separately identified on the face of the income statement to assist in understanding the underlying financial performance achieved by the Group. Such items will affect the absolute amount of the results for the period and the trend of results. These include the trading results of businesses discontinued / to be discontinued, gains and losses on the disposal of businesses and investments, costs of restructuring and reorganisation of existing businesses, acquisition costs, impairment and amortisation charges on intangible assets arising on business combinations ("amortisation of acquired intangible assets") and impairment of goodwill as well as the tax effect of the items above. Such excluded items are described as 'Non-underlying'. Further information on these items is shown in Note 4.

CONDENSED CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME

for the 6 months ended 31 December 2014

1 Restated for classification of the Tonbridge operations as discontinued operations (Note 6)

2 Restated for the classification of the London Exclusive Residential operations as a business to be discontinued within non-underlying items (Notes 1

and 4)

CONDENSED CONSOLIDATED BALANCE SHEET

as at 31 December 2014

CONDENSED CONSOLIDATED STATEMENT OF CHANGES IN EQUITY

for the 6 months ended 31 December 2014

The foreign currency translation reserve is used to record cumulative translation differences on the goodwill and other intangible assets of foreign operations (Notes 9 and 10). The cumulative translation differences are recycled to the income statement on disposal of the foreign operation.

CONDENSED CONSOLIDATED CASH FLOW STATEMENT

1 Restated for classification of the Tonbridge operations as discontinued operations (Note 6)

2 Restated for the classification of the London Exclusive Residential operations as a business to be discontinued within non-underlying items (Notes 1

and 4)

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

1. BASIS OF PREPARATION AND SIGNIFICANT ACCOUNTING POLICIES

General information

The results for the half years ended 31 December 2013 and 2014 and the balance sheets at those dates have not been audited and do not constitute statutory accounts. The financial information for the year ended 30 June 2014 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. A copy of the statutory accounts for that year has been delivered to the Registrar of Companies. The auditor's report on those accounts was not qualified, did not include a reference to any matters to which the auditors drew attention by way of emphasis without qualifying the audit report and did not contain statements under section 498 of the Companies Act 2006.

The Group's activities and the key risks facing its future development, performance and position are set out in the interim report and accounts. Following the issues affecting the UK Construction business referred to in the Chief Executive Officer's statement, the directors have reviewed the current and projected position of the Group. In light of the successful fund raising that has raised net proceeds of £15m and the increased banking facilities, the directors continue to have a reasonable expectation that the Group will have adequate resources to continue in operational existence for the foreseeable future. Accordingly, they continue to adopt the going concern basis in preparing the half yearly condensed consolidated financial statements.

Statement of compliance

The condensed set of financial statements included in this interim report have been prepared in accordance with International Accounting Standard (IAS) 34 'Interim Financial Reporting', as adopted by the European Union and the Disclosure and Transparency Rules of the Financial Services Authority. The Group's condensed financial statements should be read in conjunction with the annual financial statements for the year ended 30 June 2014, which were prepared in accordance with International Financial Reporting Standards (IFRS) as adopted by the European Union.

Restatement of prior period balances

In June 2014, the Group's UK Construction business discontinued its operations from its Tonbridge office in line with the restructuring of our UK Construction business to four regions. Consequently, the results from this operation have been classified as a discontinued operation for all periods presented.

In January 2015, the Group announced that it had discontinued its London Exclusive Residential activities following a review which concluded that the rewards of this market do not meet the division's new bid and risk management policies. As the decision to discontinue the operations was made and executed in January 2015, after the balance sheet date of 31 December 2014, the operations do not meet the definition of "discontinued operations" as stipulated by IFRS 5. Accordingly, the results of this operation for the current period and all comparative periods have been included within non-underlying items, and therefore differ from the presentation for applicable discontinued operations. Further information on the impact of these restatements for prior periods is included within Notes 3, 4, 5, 6 and 8.

Accounting policies

The same accounting polices and methods of consolidation are followed in this condensed set of financial statements as applied in the Group's latest annual report and accounts for the year ended 30 June 2014.

During the current period, the following accounting standards were adopted and either had no impact on the financial statements or resulted in changes to presentation and disclosure only:

· IFRS 10, IFRS 12, IAS 27 (amendments) 'Investment Entities'; effective 1 January 2014

· IAS 32 (amendments) 'Offsetting Financial Assets and Liabilities'; effective 1 January 2014

· IAS 39 (amendments) 'Novation of Continuation of Hedge Accounting'; effective 1 January 2014

· IAS 36 (amendments) 'Recoverable Amount Derivatives and Disclosures for Non-Financial Assets'; effective 1 January 2014

· IFRIC 21 'Levies'; effective 1 January 2014

2. SEASONALITY

The Group's activities are generally not subject to significant seasonal variation.

3. SEGMENTAL INFORMATION

For management purposes, the Group is organised into operating segments on both a geographic and product perspective. The performances of these segments are considered by the Board when making strategic decisions. These segments include the UK, Continental Europe, Middle East and Asia, whilst the UK is further segregated by product into UK Fit Out and Engineering Services, UK Retail and UK Construction.

Although the Middle East geographical segment does not meet the quantitative thresholds required by IFRS 8 'Operating Segments', management has concluded that this segment should be reported. This segment is closely monitored by the Board as a potential growth region and is expected to materially contribute to Group revenue in the future.

The principal activities of each of these divisions are as follows:

The segmental information provided to the Board for the reportable segments for the period ended 31 December 2014 is as follows. Included in revenue from UK Fit Out and Engineering Services, UK Construction, Continental Europe and Asia is revenue of £162.3m (Dec 2013: £106.1m) which arose from sales to the Group's largest customer. No other single customer contributed 10% or more to the Group's income in either 2013 or 2014.

1 Restated for classification of the Tonbridge operations as discontinued operations (Note 6)

2 Restated for the classification of the London Exclusive Residential operations as a business to be discontinued within non-underlying items (Notes 1

and 4)

4. Non-underlying items

1 Restated for the classification of the London Exclusive Residential operations as a business to be discontinued within non-underlying items (Note 1)

In January 2015, the Group announced that it had discontinued its London Exclusive Residential activities following a review which concluded that the rewards of this market do not meet the division's new bid and risk management policies. As the decision to discontinue the operations was made and executed in January 2015, after the balance sheet date of 31 December 2014, the operations do not meet the definition of "discontinued operations" as stipulated by IFRS 5. Accordingly, the results of this operation for the current period and all comparative periods have been included within non-underlying items, and therefore differ from the presentation for applicable discontinued operations. The loss in the period of £7.0m (Dec 2013: £0.8m) reflects the losses incurred in the year to date as well as the Board's assessment of the losses to close out the remaining contracts.

The Group has incurred restructuring costs of £nil (Dec 2013: £1.4m) following the substantial completion of the exercise in respect of the UK Construction operations with the reorganisation of the business from seven regions to four.

On 16 July 2014 the Group acquired 50.1% of the shares in Interior ISG Espana SA (see Note 15) and £0.4m of associated acquisition related expenses were incurred during the period.

5. Tax on profit on ordinary activities