2016_Halma_ARA_160610_2

Notes to the Accounts continued
3 NON-GAAP MEASURES
The Board uses certain non-GAAP measures to help it effectively monitor the performance of the Group. These measures include
Return on Total Invested Capital, Return on Capital Employed, Organic growth at constant currency, Adjusted operating profit and
Adjusted operating cash flow.
Return on Total Invested Capital
Return on Capital Employed
* Adjustments include the amortisation of acquired intangible assets; acquisition items; and profit or loss on disposal of operations.
** Includes goodwill amortised prior to 3 April 2004 and goodwill taken to reserves.
2 April
2016
£000
28 March
2015
£000
Post-tax profit before adjustments* 129,641 117,912
Total shareholders’ funds 646,340 548,948
Add back retirement benefit obligations 52,323 66,790
Less associated deferred tax assets (9,619) (13,085)
Cumulative amortisation of acquired intangible assets 112,478 83,958
Historical adjustments to goodwill** 89,549 89,549
Total Invested Capital 891,071 776,160
Average Total Invested Capital 833,616 721,255
Return on Total Invested Capital (ROTIC) 15.6% 16.3%
2 April
2016
£000
28 March
2015
£000
Operating profit before adjustments*, but after share of results of associate 173,066 158,564
Computer software costs within intangible assets 3,215 2,835
Capitalised development costs within intangible assets 23,540 15,865
Other intangibles within intangible assets 903 450
Property, plant and equipment 96,562 86,303
Inventories 105,318 79,734
Trade and other receivables 183,619 156,464
Trade and other payables (122,791) (102,717)
Current provisions (4,437) (11,746)
Net tax liabilities (14,968) (12,385)
Non-current trade and other payables (10,153) (3,756)
Non-current provisions (18,510) (1,549)
Add back contingent purchase consideration 17,075 9,650
Capital Employed 259,373 219,148
Average Capital Employed 239,261 204,428
Return on Capital Employed (ROCE) 72.3% 77.6%
122 120
Halma plc Annual Report and Accounts 2016