Glossary of terms – Alternative Performance Measures (APMs)
APMs are the way that financial performance is measured by management and reported to the Board, and the basis of financial measures for senior management’s compensation schemes, and provide supplementary information that assists the user in understanding the underlying trading results.
Closest equivalent IFRS measure
Adjustments to reconcile to IFRS measure
Note reference for reconciliation
Definition, purpose and considerations made by the Directors
APM
Income Statement measures: Adjusted operating profit
3 Represents operating profit before amortisation of acquired intangibles, share-based payments and Individually Significant Items. This measure is to allow the user to understand the Group’s underlying financial performance as measured by management, reported to the Board and used as a financial measure in senior management’s compensation schemes. The Directors consider amortisation of acquired intangibles is a non-cash accounting charge inherently linked to losses associated with historical acquisitions of businesses. The Directors consider share-based payments to be an adjusting item on the basis that fair values are volatile due to movements in share price, which may not be reflective of the underlying performance of the Group. Individually Significant Items are items that are considered unusual by nature or scale, and are of such significance that separate disclosure is relevant to understanding the Group’s financial performance and therefore requires separate presentation in the Financial Statements in order to fairly present the financial performance of the Group. 3 Represents operating profit before adjusting items, depreciation and amortisation to assist in the understanding of the Group’s performance. Adjusted EBITDA is disclosed as this is a measure widely used by various stakeholders and used by the Group to measure the cash conversion ratio. 11 Represents basic EPS before amortisation of acquired intangibles, share-based payments and Individually Significant Items. This measure is to allow the user to understand the Group’s underlying financial performance as measured by management, reported to the Board and used as a financial measure in senior management’s compensation schemes. See further details above in relation to amortisation of acquired intangibles and share-based payments.
Operating profit or loss
Operating profit or loss before amortisation of acquired intangibles,
share-based payments and Individually Significant Items
Operating profit or loss
Operating profit or loss, before adjusting items, depreciation and amortisation, finance costs and taxation
Adjusted earnings before interest, tax, depreciation and amortisation
(Adjusted EBITDA) Adjusted basic EPS
Statutory basic EPS
Statutory basic EPS before amortisation of acquired intangibles, share-based
payments, Individually Significant Items and the tax effect thereon
NCC Group plc — Annual report and accounts for the year ended 31 May 2021
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