Exhibit 99.2

Synergy Health Limited (formerly Synergy Health plc) : Index to Financial Statements

Unaudited Condensed Consolidated Financial Statements for the Period Ended 27 September 2015

 

Condensed Consolidated Income Statement			1
Condensed Consolidated Statement of Comprehensive Income			3
Condensed Consolidated Statement of Financial Position			4
Condensed Consolidated Cash Flow Statement			5
Condensed Consolidated Statement of Changes in Equity			6
Notes to the Condensed Consolidated Financial Statements			7

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Unaudited condensed consolidated income statement

 

For the period ended 27 September 2015
						Six months ended 27 September 2015												Six months ended 28 September 2014
		Note				Before amortisation of acquired intangibles and non-recurring items £’000				Amortisation of acquired intangibles and non-recurring items (note 7) £’000				Total £’000				Before amortisation of acquired intangibles  and non-recurring items £’000				Amortisation of acquired intangibles and non-recurring items (note 7) £’000				Total £’000
Continuing operations
Revenue			6				206,290				—				206,290				197,506				—				197,506
Cost of sales							(118,933	)			—				(118,933	)			(110,558	)			—				(110,558	)
Gross profit							87,357				—				87,357				86,948				—				86,948
Administrative expenses
– Administration expenses excluding amortisation of acquired intangibles							(54,247	)			(17,550	)			(71,797	)			(55,402	)			594				(54,808	)
– Amortisation of acquired intangibles							—				(4,364	)			(4,364	)			—				(4,298	)			(4,298	)
							(54,247	)			(21,914	)			(76,161	)			(55,402	)			(3,704	)			(59,106	)
Operating profit			6				33,110				(21,914	)			11,196				31,546				(3,704	)			27,842
Finance income							1,255				—				1,255				2,066				—				2,066
Finance costs							(4,193	)			(450	)			(4,643	)			(5,252	)			—				(5,252	)
Net finance costs							(2,938	)			(450	)			(3,388	)			(3,186	)			—				(3,186	)
Profit before tax							30,172				(22,364	)			7,808				28,360				(3,704	)			24,656
Income tax			8				(5,267	)			2,268				(2,999	)			(6,770	)			518				(6,252	)
Profit for the period							24,905				(20,096	)			4,809				21,590				(3,186	)			18,404
Attributable to:
Equity holders of the parent							25,079				(20,096	)			4,983				21,467				(3,186	)			18,281
Non-controlling interests							(174	)			—				(174	)			123				—				123
							24,905				(20,096	)			4,809				21,590				(3,186	)			18,404
Earnings per share
Basic			10												8.43p												31.02p
Diluted			10												8.27p												30.75p

 

1

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Unaudited condensed consolidated income statement

 

						Period ended 29 March 2015
		Note				Before amortisation of acquired intangibles  and non-recurring items £’000				Amortisation of acquired intangibles and non-recurring items (note 7) £’000				Total £’000
Continuing operations
Revenue			6				408,824				—				408,824
Cost of sales							(233,761	)			—				(233,761	)
Gross profit							175,063				—				175,063
Administrative expenses
– Administration expenses excluding amortisation of acquired intangibles							(110,502	)			(5,812	)			(116,314	)
– Amortisation of acquired intangibles							—				(8,606	)			(8,606	)
							(110,502	)			(14,418	)			(124,920	)
Operating profit			6				64,561				(14,418	)			50,143
Finance income							4,291				—				4,291
Finance costs							(10,855	)			—				(10,855	)
Net finance costs							(6,564	)			—				(6,564	)
Profit before tax							57,997				(14,418	)			43,579
Income tax			8				(13,346	)			3,445				(9,901	)
Profit for the period							44,651				(10,973	)			33,678
Attributable to:
Equity holders of the parent							44,542				(10,973	)			33,569
Non-controlling interests							109				—				109
							44,651				(10,973	)			33,678
Earnings per share
Basic			10												56.90p
Diluted			10												56.37p

 

2

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Unaudited consolidated statement of comprehensive income

For the period ended 27 September 2015

 

		Six months ended 27 September 2015 £’000				Six months ended 28 September 2014 £’000				Period ended 29 March 2015 £’000
Profit for the period			4,809				18,404				33,678
Other comprehensive income/(expense) for the period:
Items that are or may be reclassified to profit or loss
Exchange differences on translation of foreign operations			(11,960	)			(7,297	)			(9,838	)
Cash flow hedges – fair value movement in equity			(378	)			(758	)			(623	)
Cash flow hedges – reclassified and reported in net profit			623				830				830
Related tax movements			(49	)			(14	)			(41	)
			(11,764	)			(7,239	)			(9,672	)
Items that will never be reclassified to profit or loss
Actuarial gain/(loss) on defined benefit pension plans			3,122				(1,823	)			(6,491	)
Related tax movements			(624	)			330				1,296
			2,498				(1,493	)			(5,195	)
			(9,266	)			(8,732	)			(14,867	)
Total comprehensive income for the period			(4,457	)			9,672				18,811
Attributable to:
Equity holders of the parent			(4,234	)			9,571				18,730
Non-controlling interests			(223	)			101				81
			(4,457	)			9,672				18,811

 

3

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Unaudited consolidated statement of financial position

At 27 September 2015

 

		Note				At 27 September 2015 £’000				At 28 September 2014 £’000				At 29 March 2015 £’000
Non-current assets
Goodwill							211,447				215,326				214,545
Other intangible assets							40,056				47,108				44,657
Property, plant and equipment			12				291,351				283,644				290,929
Investments							1,494				910				949
Trade and other receivables							2,029				2,842				1,940
Total non-current assets							546,377				549,830				553,020
Current assets
Inventories							14,060				14,625				12,887
Asset held for sale							3,144				2,733				3,192
Trade and other receivables							76,359				81,400				75,308
Cash and cash equivalents							28,042				38,436				36,952
Total current assets							121,605				137,194				128,339
Total assets							667,982				687,024				681,359
Capital and reserves attributable to the Group’s equity holders
Share capital							370				369				369
Share premium account							90,566				89,951				90,517
Translation reserve							2,987				17,433				14,898
Cash flow hedging reserve							(302	)			(606	)			(498	)
Merger reserve							106,757				106,757				106,757
Retained earnings							158,530				132,091				145,582
Equity attributable to equity holders of the parent							358,908				345,995				357,625
Non-controlling interests							2,507				2,446				3,256
Total equity							361,415				348,441				360,881
Current liabilities
Interest bearing loans and borrowings							135,906				2,808				3,230
Trade and other payables							85,070				81,391				78,049
Derivative financial instruments							378				758				623
Current tax liabilities							8,783				10,350				8,274
Short-term provisions			11				253				2,354				1,570
Total current liabilities							230,390				97,661				91,746
Non-current liabilities
Interest bearing loans and borrowings							48,387				208,433				194,787
Retirement benefit obligations							16,161				16,672				20,315
Deferred tax liabilities							3,460				8,245				5,307
Trade and other payables							271				852				338
Provisions			11				7,697				6,503				7,821
Deferred government grants							201				217				164
Total non-current liabilities							76,177				240,922				228,732
Total liabilities							306,567				338,583				320,478
Total equity and liabilities							667,982				687,024				681,359

 

4

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Unaudited consolidated cash flow statement

For the period ended 27 September 2015

 

		Six months ended 27 September 2015 £’000				Six months ended 28 September 2014 £’000				Period ended 29 March 2015 £’000
			4,809				18,404				33,678
Adjustments			38,145				22,536				62,653
Cash generated from operations			42,954				40,940				96,331
Income tax paid			(4,379	)			(2,873	)			(10,378	)
Net cash from operating activities			38,575				38,067				85,953
Cash flows from investing activities
Acquisition of subsidiaries – net of cash			(954	)			(10,624	)			(13,247	)
Disposal of subsidiaries – net of cash			(181	)			—				—
Acquisition of investments			—				—				(495	)
Purchase of property, plant and equipment (PPE)			(28,893	)			(32,087	)			(61,727	)
Purchase of intangible assets			(993	)			(1,104	)			(1,718	)
Proceeds from sale of PPE			271				1,257				1,742
Payment of pre-acquisition liabilities			—				(6,676	)			(6,676	)
Interest received			237				820				1,604
Net cash used in investing activities			(30,513	)			(48,909	)			(80,517	)
Cash flows from financing activities
Dividends paid			—				(8,372	)			(8,372	)
Dividend paid to non-controlling interest			—				(134	)			(134	)
Proceeds from borrowings			28,886				45,119				62,655
Repayment of borrowings			(40,843	)			(14,068	)			(45,504	)
Repayment of hire purchase loans and finance leases			(1,326	)			(1,631	)			(2,944	)
Interest paid			(2,804	)			(3,788	)			(7,052	)
Proceeds from issue of shares			50				43				609
Proceeds from issue of shares – non-controlling interest			509				—				416
Net cash (used in)/from financing activities			(15,528	)			17,169				(326	)
Net (decrease)/increase in cash and bank overdrafts			(7,466	)			6,327				5,110
Cash and bank overdrafts at beginning of period			36,952				32,263				32,263
Exchange differences			(1,484	)			(486	)			(421	)
Cash and bank overdrafts at end of period			28,002				38,104				36,952

 

		At 27 September 2015 £’000				At 28 September 2014 £’000				At 29 March 2015 £’000
Cash generated from operations
Profit for the period			4,809				18,404				33,678
Adjustments for:
– depreciation and impairments			20,344				19,805				39,532
– amortisation of intangible assets			5,036				4,817				9,677
– equity-settled share-based payments			5,102				650				2,213
– loss on sale of tangible fixed assets			373				1				931
– gain on sale of subsidiary			(100	)			—
– loss on impairment of subsidiary			139				—
– curtailment and cessation gains on defined benefit pension schemes			—				(932	)			(932	)
– finance income			(1,255	)			(2,066	)			(4,291	)
– finance costs			4,643				5,252				10,855
– income tax expense			2,999				6,252				9,901
Changes in working capital:
– inventories			(1,078	)			(956	)			(504	)
– trade and other receivables			(3,402	)			(8,545	)			(241	)
– trade, other payables and provisions			5,344				(1,742	)			(4,488	)
Cash generated from operations			42,954				40,940				96,331

 

5

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Unaudited condensed consolidated statement of changes in equity

For the period ended 27 September 2015

 

		Share capital £’000				Share premium £’000				Treasury share reserve £’000				Merger reserve £’000				Cash flow hedging reserves £’000				Translation reserve £’000				Retained earnings £’000				Total attributable to equity holders of the parent £’000				Non-controlling interest £’000				Total equity £’000
Balance at 30 March 2014			368				89,909				—				106,757				(664	)			24,708				123,025				344,103				2,473				346,576
Profit for the period			—				—				—				—				—				—				18,281				18,281				123				18,404
Other comprehensive income/(expense):
Translation of foreign operations			—				—				—				—				—				(7,275	)			—				(7,275	)			(22	)			(7,297	)
Net movements on cash flow hedges			—				—				—				—				58				—				—				58				—				58
Actuarial movement net of tax			—				—				—				—				—				—				(1,493	)			(1,493	)			—				(1,493	)
Total comprehensive income for the period			—				—				—				—				58				(7,275	)			16,788				9,571				101				9,672
Transactions with owners of the Company recognised directly in equity:
Movement in non-controlling interest (NCI)			—				—				—				—				—				—				—				—				(128	)			(128	)
Dividends paid			—				—				—				—				—				—				(8,372	)			(8,372	)			—				(8,372	)
Issue of shares			1				42				—				—				—				—				—				43				—				43
Share-based payments (net of tax)			—				—				—				—				—				—				650				650				—				650
Balance at 28 September 2014			369				89,951				—				106,757				(606	)			17,433				132,091				345,995				2,446				348,441
Profit for the period			—				—				—				—				—				—				15,288				15,288				(14	)			15,274
Other comprehensive income/(expense):
Translation of foreign operations			—				—				—				—				—				(2,535	)			—				(2,535	)			(6	)			(2,541	)
Net movements on cash flow hedges			—				—				—				—				108				—				—				108				—				108
Actuarial movement net of tax			—				—				—				—				—				—				(3,702	)			(3,702	)			—				(3,702	)
Total comprehensive income for the period			—				—				—				—				108				(2,535	)			11,586				9,159				(20	)			9,139
Transactions with owners of the Company recognised directly in equity:
Dividends paid			—				—				—				—				—				—				—				—				—				—
Movement in NCI			—				—				—				—				—				—				—				—				6				6
NCI recognised in the period			—				—				—				—				—				—				—				—				803				803
NCI recognised in the period: acquisition			—				—				—				—				—				—				—				—				21				21
Issue of shares			—				566				—				—				—				—				—				566				—				566
Share-based payments (net of tax)			—				—				—				—				—				—				1,905				1,905				—				1,905
Balance at 29 March 2015			369				90,517				—				106,757				(498	)			14,898				145,582				357,625				3,256				360,881
Profit for the period			—				—				—				—				—				—				4,983				4,983				(174	)			4,809
Other comprehensive income/(expense):
Translation of foreign operations			—				—				—				—				—				(11,911	)			—				(11,911	)			(49	)			(11,960	)
Net movements on cash flow hedges			—				—				—				—				196				—				—				196				—				196
Actuarial movement net of tax			—				—				—				—				—				—				2,498				2,498				—				2,498
Total comprehensive income for the period			—				—				—				—				196				(11,911	)			7,481				(4,234	)			(223	)			(4,457	)
Transactions with owners of the Company recognised directly in equity:
NCI recognised in the period			—				—				—				—				—				—				—				—				884				884
NCI derecognised on disposal			—				—				—				—				—				—				—				—				(1,416	)			(1,416	)
Movement in NCI			—				—				—				—				—				—				—				—				6				6
Issue of shares			1				49				—				—				—				—				—				50				—				50
Share-based payments (net of tax)			—				—				—				—				—				—				5,467				5,467				—				5,467
Balance at 27 September 2015			370				90,566				—				106,757				(302	)			2,987				158,530				358,908				2,507				361,415

The accompanying accounting policies and notes form part of these financial statements.

 

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Unaudited notes to the condensed consolidated financial statements

1 General information

Synergy Health Limited (formerly Synergy Health plc) (‘the Company’) and its subsidiaries (together ‘the Group’) deliver a range of specialist outsourced services to health-related markets. The Company is registered in England and Wales under company registration number 3355631 and its registered office is Ground Floor Stella, Windmill Hill Business Park, Whitehill Way, Swindon, Wiltshire, SN5 6NX.

These condensed consolidated interim financial statements were approved for issue by the Board of Directors on 30 October 2014.

2 Summary of significant accounting policies

Basis of preparation

These condensed consolidated interim financial statements of the Group are for the six months ended 27 September 2015.

The condensed consolidated interim financial statements have been prepared on the basis of the accounting policies set out in the Group’s latest annual financial statements for the period ended 29 March 2015. These accounting policies are drawn up in accordance with the recognition and measurement requirements of International Financial Reporting Standards (IFRS) issued by the International Accounting Standards Board (IASB).

The information for the period ended 29 March 2015 does not constitute statutory accounts as defined in section 434 of the Companies Act 2006. A copy of the statutory accounts for that period has been delivered to the Registrar of Companies. The auditors’ report on those accounts was (i) unqualified, (ii) did not include a reference to any matters to which the auditor drew attention by way of emphasis without qualifying the report and (iii) did not contain a statement under section 498 (2) or (3) of the Companies Act 2006.

The condensed consolidated interim financial statements for the six months to 27 September 2015 have not been audited or reviewed by auditors pursuant to the Auditing Practices Board guidance on Review of Interim Financial Information.

Going concern

The Directors have reviewed the Group’s medium-term forecasts through to October 2016 along with reasonable possible changes in trading performance and foreign currencies. The Directors have also reviewed the funding arrangements put in place by STERIS to support the Group should the proposed combination proceed.

Absent the proposed combination with STERIS, elements of the Group’s committed banking facilities would fall due for renewal in July 2016. The Directors have good reasons to believe that they would be renewed.

The purpose of these reviews has been for the Directors to determine whether, with or without the proposed combination with STERIS, committed banking facilities would be available sufficient to support the Group’s projected liquidity requirements, and whether the forecast earnings would be sufficient to meet covenants associated with the banking facilities.

After making enquiries, the Directors have a reasonable expectation that the Group has adequate resources to continue in operational existence for the foreseeable future, and have continued to adopt the going concern basis in preparing the condensed consolidated interim financial statements.

Significant accounting policies

The condensed consolidated interim financial statements have been prepared under the historical cost convention except that derivative financial instruments are stated at their fair value. Except as described below, the accounting policies adopted in the preparation of the condensed consolidated interim financial statements are the same as those followed in the preparation of the Group’s annual financial statements for the period ended 29 March 2015.

3 Statement of compliance

These condensed consolidated interim financial statements have been prepared and approved by the Directors in accordance with International Accounting Standard (IAS) 34 ‘Interim

 

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Financial Reporting’ as adopted by the EU (adopted IAS 34) and with the Disclosure and Transparency Rules of the UK Financial Services Authority. These condensed consolidated interim financial statements have not been audited or reviewed by the Group’s auditors in accordance with International Standard on Review Engagements 2410 issued by the Auditing Practices Board. They do not include all of the information required for full annual financial statements, and should be read in conjunction with the consolidated financial statements of the Group as at and for the period ended 29 March 2015.

4 Financial risk management

The primary risks arising from the Group’s financial instruments are interest rate risk, foreign currency risk, credit risk and liquidity risk. These risks and the Group’s financial risk management objectives and policies are consistent with that disclosed in the consolidated financial statements as at and for the period ended 29 March 2015.

5 Estimates (continued)

The preparation of the condensed consolidated interim financial statements requires management to make judgements, estimates and assumptions that affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense. Actual results may differ from these estimates. Except as described below, in preparing these condensed consolidated interim financial statements, the significant judgements made by management in applying the Group’s accounting policies and the key sources of estimation and uncertainty were the same as those that applied to the consolidated financial statements as at and for the period ended 29 March 2015.

During the 6 months ended 27 September 2015, management reassessed its estimates in respect of actuarial assumptions in relation to the Group’s defined benefit pension schemes using professional advice and relevant market benchmark data for discount rates and inflation.

6 Segmental information

The Group is organised into three operating segments: Applied Sterilisation Technologies and Laboratory Services (‘AST’), Healthcare Services (‘HS’), and Healthcare Solutions (‘HCS’).

Information on these segments is reported to the chief operating decision maker (‘CODM’) for the purposes of resource allocation and assessment of performance. The chief operating decision maker has been identified as the Board of Directors. The CODM monitors the performance of the operating segments based on adjusted operating profit, being operating profit excluding the impact of amortisation on acquired intangibles and non-recurring items. Segment information is presented below.

 

Six month period ended 27 September 2015		AST 2015 £’000				HS 2015 £’000				HCS 2015 £’000				Total 2015 £’000
Revenue from external customers			70,733				92,111				43,446				206,290
Segment profit			25,162				8,719				2,950				36,831
Segment depreciation			9,350				3,714				7,280				20,344
Segment assets			425,498				148,689				93,795				667,982
Six month period ended 28 September 2014		AST 2014 £’000				HS 2014 £’000				HCS 2014 £’000				Total 2014 £’000
Revenue from external customers			67,031				82,956				47,519				197,506
Segment profit			23,272				8,704				3,450				35,426
Segment depreciation			9,026				3,048				7,731				19,805
Segment assets			446,592				142,155				98,277				687,024
Period ended 29 March 2015		AST 2015 £’000				HS 2015 £’000				HCS 2015 £’000				Total 2015 £’000
Revenue from external customers			137,496				175,832				95,496				408,824
Segment profit			47,294				18,351				6,575				72,220
Segment depreciation			17,963				6,086				15,483				39,532
Segment assets			435,501				151,373				94,485				681,359

 

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The table below reconciles the total segment profit above, to the Group’s operating profit and profit before tax:

 

		Six month period ended 27 September 2015 £’000				Six month period ended 28 September 2014 £’000				Period ended 29 March 2015 £’000
Total segment profit			36,831				35,426				72,220
Unallocated amounts:
– Corporate expenses			(3,721	)			(3,880	)			(7,659	)
– Non-recurring costs			(17,550	)			594				(5,812	)
Amortisation of acquired intangibles			(4,364	)			(4,298	)			(8,606	)
Operating profit			11,196				27,842				50,143
Net finance costs			(3,388	)			(3,186	)			(6,564	)
Profit before tax			7,808				24,656				43,579

6 Segmental information continued

IFRS 8 Operating Segments requires the Group to disclose information about the extent of its reliance on its major customers. The Group has no single customer making up more than 10% of total revenue.

The table below analyses the Group’s revenue from external customers, and non-current assets other than financial instruments, investment properties, and deferred taxation, by geography.

 

		Six month period ended 27 September 2015 £’000 Revenue				Non- current assets				Six month period ended 28 September 2014 £’000 Revenue				Non- current assets				Period ended 29 March 2015 £’000 Revenue				Non- current assets
UK			81,289				146,662				78,762				146,101				160,610				144,360
Netherlands			35,264				100,340				41,982				110,642				82,306				100,042
USA			46,750				52,922				37,348				42,964				82,702				48,969
Rest of World			42,987				246,453				39,414				250,123				83,206				259,649
			206,290				546,377				197,506				549,830				408,824				553,020

7 Non-recurring items and acquisition-related costs

In the period to 27 September 2015, non-recurring items of £18 million have been charged in arriving at operating profit. The table and accompanying notes provide further details:

 

		£’000
Transaction costs incurred on the proposed combination with STERIS			11,810
Share-based payment costs accelerated by the proposed combination with STERIS			6,191
Gain on settlement of insurance claim			(638	)
Restructuring costs			109
Other acquisition related transaction fees			78
2015 non-recurring charge			17,550
Accelerated amortisation of financing arrangement fees			450
			18,000

In the period to 28 September 2014, non-recurring items of £594,000 were credited in arriving at operating profit. This included costs of £285,000 related to acquisition transaction fees and a £932,000 cessation gain on a component of the Group’s retirement benefit obligations.

 

9

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In the year to 29 March 2015, non-recurring items of £5,812,000 were charged in arriving at operating profit. £4,515,000 related to acquisition transaction fees. The most significant component of this cost was £2,900,000 relating to the proposed combination with STERIS. Operational and restructuring costs were £2,510,000, primarily relating to the settlement of prior period claims and facility closure costs in the Dutch Linen business.

8 Tax

 

		Six month period ended 28 September 2014 £’000				Six month period ended 29 September 2013 £’000				Period ended 30 March 2014 £’000
Current tax:
UK tax			1,459				2,191				4,775
Overseas tax			3,473				4,300				9,576
Adjustment in respect of prior periods			—				—				(2,285	)
Total current tax			4,932				6,491				12,066
Deferred tax:
Origination and reversal of temporary differences			(1,933	)			(239	)			(2,235	)
Adjustment in respect of prior periods			—				—				70
Effect of rate change			—				—				—
Total deferred tax			(1,933	)			(239	)			(2,165	)
Total tax in income statement			2,999				6,252				9,901

The Group’s effective tax rate for the period on earnings before non-recurring items and the amortisation of acquired intangibles is 17.5% (2014: 23.9%). The reduction in the rate compared to the prior period is due to the completion of a tax audit, with no material adjustment required. Excluding the impact of the tax audit the recurring tax rate over the full year would have been 23.4% (2014: 23.9%). UK corporation tax is calculated at 20% (2014: 21%) of the estimated assessable profit for the year. Taxation for overseas operations is calculated at the local prevailing rates.

Tax credits of £2.2m arose in respect of amortisation of acquired intangibles and non-recurring items (2014: £0.5m). This represents an effective overall tax rate (after amortisation of acquired intangibles and non-recurring costs) of 38.4% (2014: 25.4%). This increase in overall effective tax rate is due to some of the non-recurring costs related to the recommended combination between Synergy Heath and STERIS not being deductible for tax.

A number of changes to the UK corporation tax system were announced in the Chancellor’s Budget on 8 July 2015. These include reductions to the main rate of corporation tax to reduce the rate to 19% from 1 April 2017 and to 18% from 1 April 2020. As the changes had not been substantively enacted at the balance sheet date their effects are not included in these financial statements. The changes are not expected to have a material impact on the Group’s deferred tax balances.

9 Dividends

 

Six month period ended 27 September 2015 £’000

Six month period ended 28 September 2014 £’000

Period ended 29 March 2015 £’000

Amounts recognised as distributions to equity holders in the period:

Final dividend for the period ended 30 March 2014 of 14.20p (2013: 12.80p) per share

—

8,372

8,372

No dividend (interim or final) was paid for the year ended 29 March 2015. On 20 October 2015 the Directors paid an interim dividend for the year ending 3 April 2016 of 15.80 pence (2014: nil).

 

10

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10 Earnings per share

 

		Six month period ended 27 September 2015 £’000				Six month period ended 28 September 2014 £’000				Period ended 29 March 2015 £’000
Earnings
Earnings for the purposes of basic earnings per share being net profit attributable to equity holders of the parent			4,983				18,281				33,569
		Shares ‘000				Shares ‘000				Shares ‘000
Number of shares
Weighted average number of ordinary shares for the purposes of basic earnings per share			59,132				58,940				58,998
Effect of dilutive potential ordinary shares:
Share options			1,109				495				554
Weighted average number of ordinary shares for the purposes of diluted earnings per share			60,241				59,435				59,552
Earnings per ordinary share
Basic			8.43p				31.02p				56.90p
Diluted			8.27p				30.75p				56.37p
		£’000				£’000				£’000
Adjusted earnings per share
Operating profit			11,196				27,842				50,143
Amortisation of acquired intangible assets			4,364				4,298				8,606
Non-recurring items			17,550				(594	)			5,812
Adjusted operating profit			33,110				31,546				64,561
Net finance costs, excluding acquisition-related finance costs			(2,938	)			(3,186	)			(6,564	)
Adjusted profit on ordinary activities before taxation			30,172				28,360				57,997
Taxation on adjusted profit on ordinary activities			(5,267	)			(6,770	)			(13,346	)
Non-controlling interest			174				(123	)			(109	)
Adjusted net profit attributable to equity holders of the parent			25,079				21,467				44,542
Adjusted basic earnings per share			42.41p				36.42p				75.50p
Adjusted diluted earnings per share			41.63p				36.12p				74.80p

 

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11 Provisions

 

		Cobalt disposal costs £’000				Other provisions £’000				Total £’000
At 30 March 2014			5,877				4,349				10,226
Additional provision in the period			—				—				—
Unwinding of discounting			20				190				210
Utilised in the period			—				(2,412	)			(2,412	)
Reclassification to other non-current liabilities			—				969				969
Exchange differences			(54	)			(82	)			(136	)
At 28 September 2014			5,843				3,014				8,857
Additional provision in the period			241				627				868
Unwinding of discounting			(20	)			(190	)			(210	)
Utilised in the period			(144	)			(6	)			(150	)
Reclassification to other non-current liabilities			—				38				38
Exchange differences			42				(54	)			(12	)
At 29 March 2015			5,962				3,429				9,391
Additional provision in the period			12				24				36
Unwinding of discounting			—				—				—
Utilised in the period			(116	)			(1,302	)			(1,418	)
Exchange differences			(52	)			(7	)			(59	)
At 27 September 2015			5,806				2,144				7,950
Included in current liabilities											253
Included in non-current liabilities											7,697
											7,950

The cobalt disposal provision recognises a potential decommissioning liability in respect of certain types of cobalt used in some of the Group’s AST sites. It is anticipated that the provision will be utilised as the cobalt to which the provision relates reaches the end of its useful economic life. Other provisions include provisions against vacated properties and other restructuring costs.

12 Property, plant and equipment

During the period ended 27 September 2015, the Group purchased assets with a total cost of approximately £31.2 million (28 September 2014: £32.9 million).

 

12

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13(a) Prior period acquisition of subsidiary – Bioster

On 15 May 2014, the Group acquired the entire issued share capital of Bioster S.p.A. and associated companies (‘Bioster’).

Bioster Group operates ethylene oxide and electron beam sterilisation facilities in Italy, Slovakia, and the Czech Republic, providing sterilisation services to the medical device, pharmaceutical and packaging industries. In addition, it operates a hospital sterilisation services (‘HSS’) business in Italy.

The fair value of the net assets acquired and the related consideration were as follows:

 

		Fair value £’000
Property, plant and equipment			15,845
Intangible assets			3,351
Investments			9
Inventories			80
Trade and other receivables			11,871
Cash and cash equivalents			280
Borrowings due within one year			(3,517	)
Trade and other payables			(14,952	)
Corporation tax payable			(122	)
Bank overdraft			(1,902	)
Borrowings due after one year			(4,073	)
Other provisions			(1,007	)
Deferred taxation liabilities			(1,892	)
Fair value of assets acquired			3,971
Cash consideration			9,020
Goodwill arising on acquisition			5,049

The goodwill arising on the acquisition of the business is attributable to the assembled workforce and the synergies generated following the integration of Bioster into the Group.

In accordance with IFRS 3 (revised) Business Combinations management have made adjustments to the local book values of net assets acquired to arrive at the fair value disclosed above. The most significant of these adjustments include the recognition of intangible assets (customer lists), the recognition of deferred taxation liabilities, and the application of IFRS to the recognition of assets under finance leases and the associated finance lease liabilities.

Total transaction costs of £530,000 were incurred in the acquisition of Bioster Group and were expensed within non-recurring items and acquisition-related costs.

During the period, the Bioster Group contributed £8,238,000 to revenue and £1,212,000 to operating profit.

Summary of cash flows:

 

		£’000
Cash consideration			9,020
Net overdraft acquired with business			1,622
Acquisition of subsidiaries – net of cash			10,642

 

13

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13(b) Prior period acquisition of subsidiary – IDtek

On 3 November 2014, the Group acquired 70% of the issued share capital of IDtek Track-and-Trace SA (‘IDtek’), a company incorporated in Switzerland, gaining control of the company and its subsidiaries. IDtek provides RFID-led solutions to a wide range of industries including energy and automotive sectors, and it is our intention to utilise its expertise and intellectual property to develop new services for the healthcare market.

The provisional fair value of the net assets acquired and the related consideration were as follows:

 

		Fair value £’000
Property, plant and equipment			13
Intangible assets			730
Inventories			33
Trade and other receivables			533
Cash and cash equivalents			288
Trade and other payables			(497	)
Corporation tax payable			(53	)
Deferred taxation liabilities			(146	)
Long-term payables			(202	)
Minority interest			(396	)
Fair value of assets acquired			303
Cash consideration			2,286
Deferred consideration			419
Total consideration			2,705
Goodwill arising on acquisition			2,402

The goodwill arising on the acquisition of the business is attributable to the synergies generated following the integration of IDtek into the Group, and has been allocated to the HS segment.

In accordance with IFRS 3 (revised) ‘Business combinations’, management have made adjustments to the book value of net assets acquired to arrive at the fair values disclosed above.

Total transaction costs of £111,000 were incurred in the acquisition and were expensed within non-recurring items and acquisition-related costs.

Summary of cash flows:

Summary of cash flows:

 

		£’000
Cash consideration			2,286
Cash acquired with business			(288	)
Acquisition of subsidiaries – net of cash			1,998

Summary of deferred consideration

 

		£’000
At 29 March 2015			458
Amounts paid			(440	)
Adjustments			(7	)
Exchange differences			(11	)
As at 27 September 2015			—

 

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14 Post balance sheet events

On 2 October the shareholders of Synergy Health Limited voted to approve the combination of Synergy and STERIS Corp.

On 20 October 2015 the Directors paid an interim dividend for the year ending 3 April 2016 of 15.80 pence (2014: nil).

On 26 October all outstanding Synergy share options vested, and for non-SAYE options were exercised and converted to Synergy shares on the same day, according to the option-holders’ instructions. Also on the 26 October, trading on the London Stock Exchange in Synergy shares was suspended.

On 28 October, a hearing took place at the High Court where all outstanding Synergy shares were cancelled, barring only the one share held by New STERIS Limited.

There were no other material events subsequent to the year end and up to 30 October 2015, the date of approval of the Financial Statements by the Board.

Forward-looking statements

Certain information included in this announcement is forward-looking and involves risks, assumptions and uncertainties that could cause actual results to differ materially from those expressed or implied by forward-looking statements. Forward-looking statements cover all matters which are not historical facts and include, without limitation, projections relating to results of operations and financial conditions and the Company’s plans and objectives for future operations, including, without limitation, discussions of expected future revenue, financing plans, expected expenditures, risks associated with changes in economic conditions, the strength of the markets in the jurisdictions in which the Group operates, and changes in exchange and interest rates. Forward-looking statements can be identified by the use of forward-looking terminology including terms such as “believes”, “estimates”, “anticipates”, “expects”, “forecasts”, “intends”, “plans”, “projects”, “goal”, “target”, “aim”, “may”, “will”, “would”, “could”, or “should” or, in each case, their negative or other variations or comparable terminology. Forward-looking statements are not guarantees of future performance. All forward-looking statements in this announcement are based upon information known to the Company on the date of this announcement. Accordingly, no assurance can be given that any particular expectation will be met and readers are cautioned not to place undue reliance on forward-looking statements, which speak only at their respective dates. Additionally, forward-looking statements regarding past trends or activities should not be taken as a representation that such trends or activities will continue in the future. Other than in accordance with its legal or regulatory obligations (including under the UK Listing Rules and the Disclosure and Transparency Rules of the Financial Services Authority), the Company undertakes no obligation to publicly update or revise any forward-looking statement, whether as a result of new information, future events or otherwise. Nothing in this announcement shall exclude any liability under applicable laws that cannot be excluded in accordance with such laws.

Statement of Directors’ Responsibilities

We confirm that to the best of our knowledge:

 

•

the condensed consolidated interim financial statements have been prepared in accordance with IAS 34 Interim Financial Reporting as adopted by the EU; and,

 

•

the interim management report includes a fair review of the information required by:

(a) DTR 4.2.7R of the Disclosure and Transparency Rules, being an indication of important events that have occurred during the first six months of the financial year and their impact on the condensed set of financial statements; and a description of the principal risks and uncertainties for the remaining six months of the year; and

(b) DTR 4.2.8R of the Disclosure and Transparency Rules, being related party transactions that have taken place in the first six months of the current financial year and that have materially affected the financial position or performance of the entity during that period; and any changes in the related party transactions described in the last annual report that could do so.

 

15

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This report has been approved by the Board of Directors and signed on its behalf by:

Richard Steeves

Chief Executive

30 October 2015

Registered office: Synergy Health Limited, Ground Floor Stella, Windmill Hill Business Park, Swindon, Wiltshire SN5 6NX Website: www.synergyhealthplc.com

 

16