COMPUTERSHARE LIMITED. - Annual Report 2013

ASX PRELIMINARY FINAL REPORT

Computershare Limited

ABN 71 005 485 825

30 June 2013

Lodged with the ASX under Listing Rule 4.3A

Results for Announcement to the Market 1 Appendix 4E item 2 Preliminary consolidated statement of comprehensive income 2 Appendix 4E item 3 Preliminary consolidated statement of financial position 3 Appendix 4E item 4 Preliminary consolidated statement of changes in equity 4 Appendix 4E item 6 Preliminary consolidated statement of cash flows 5 Appendix 4E item 5 Supplementary Appendix 4E Information 6 Appendix 4E item 6 to 15

This report covers the consolidated entity consisting of Computershare Limited and its controlled entities. The financial report is presented in United States dollars (unless otherwise stated).

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES YEAR ENDED 30 JUNE 2013 (Previous corresponding period year ended 30 June 2012) RESULTS FOR ANNOUNCEMENT TO THE MARKET

				$000
Revenuefrom continuing operations	up	11.8%	to	2,019,949
(Appendix 4E item 2.1)
Profit/(loss)after tax attributable to members	down	9.2%	to	157,013
(Appendix 4E item 2.2)
Net profit/(loss)for the period attributable to members	down	9.2%	to	157,013
(Appendix 4E item 2.3)
Dividends	Amount per security		Franked amount per security
(Appendix 4E item 2.4)
Final dividend	AU	14 cents		20%
Interim dividend	AU	14 cents		20%
Record datefor determining entitlements to the final dividend	26	August 2013
(Appendix 4E item 2.5)

Explanation of revenue (Appendix 4E item 2.6)

Total revenue from continuing operations for the year ended 30 June 2013 is USD 2,019.9 million, up 11.8% against the last corresponding period. The growth was driven largely by the full year contribution from the Shareowner Services (USA) and Specialized Loan Servicing (USA) acquisitions. The employee plans segment also contributed to the uplift in revenue year on year, particularly in the United Kingdom and the United States. Communication services revenue grew, predominantly in the USA as a result of throughput from the Shareowner Services business. Margin income also increased as a result of higher average client balances. Conversely, stakeholder relationship management again saw revenues fall as contested merger and acquisition transactions and mutual fund solicitation activities remain subdued.

Explanation of profit/(loss) from ordinary activities after tax (Appendix 4E item 2.6)

Net statutory profit after tax attributable to members is USD 157.0 million, a decrease of 9.2% over the last corresponding period. The underlying business contribution to earnings demonstrated year on year improvement, underpinned by the full year contributions from the Shareowner Services and Specialized Loan Servicing businesses. This included continued material synergies and uplift in margin income from the Shareowner Services acquisition. The employee plans segment was also instrumental in delivering earnings growth for the Group. Negating these contributions were the one-off effects of strategic business initiatives including the loss on disposal of the interactive meetings business, IML, and the Restricted Stock Services software product as well as the announced closure of the Australian Fund Services business. The increase in intangible asset amortisation during FY13 as a result of the full year recognition of FY12 acquisitions likewise contributed to the year on year decrease in profits.

The Group’s effective tax rate fell from 22.3% to 16.6% for the year ended 30 June 2013 due to the full year impact of deductible interest expense from acquisition funding, increased intangible asset amortisation and integration costs in the USA that resulted in a tax loss position in the USA. As the blended statutory rate in the USA is higher than 30%, tax deductions recognised at this higher rate reduced the effective tax rate of the Group.

Explanation of net profit/(loss) (Appendix 4E item 2.6)

Please refer to above.

Explanation of dividends (Appendix 4E item 2.6)

The following dividends have been paid, declared or recommended since the end of the preceding financial year:

Ordinary shares

A final dividend in respect of the year ended 30 June 2012 was declared on 8 August 2012 and paid on 11 September 2012. This was an ordinary dividend of AU 14 cents per share franked to 60% amounting to AUD 77,792,968 (USD 80,095,720).

An interim ordinary dividend was declared on 13 February 2013 and paid on 19 March 2013. This was an ordinary dividend of AU 14 cents per share franked to 20% amounting to AUD 77,792,968 (USD 80,095,720).

A final dividend in respect of the year ended 30 June 2013 was declared by the directors of the Company on 14 August 2013, to be paid on 17 September 2013. This is an ordinary dividend of AU 14 cents per share, franked to 20%. As the dividend was not declared until 14 August 2013, a provision has not been recognised as at 30 June 2013.

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES PRELIMINARY CONSOLIDATED STATEMENT OF COMPREHENSIVE INCOME FOR THE YEAR ENDED 30 JUNE 2013

FOR THE YEAR ENDED 30 JUNE 2013
	Note	2013 2012
		$000 $000
		restated

Revenue from continuing operations
Sales revenue		2,015,737 1,802,614
Other revenue		4,212 4,559
Total revenue from continuing operations		2,019,949 1,807,173

Other income		26,098 50,040

Expenses
Direct services		1,479,473 1,315,017
Technologycosts		289,971 234,401
Corporate services		17,236 33,219
Finance costs		66,615 48,289
Total expenses		1,853,295 1,630,926

Share of net profit/(loss) of associates and joint ventures accounted for using the equity method	15	(146) 321



Profit before related income tax expense		192,606 226,608
Income tax expense/(credit)	4	32,029 50,512

Profit for the year		160,577 176,096

Other comprehensive income that may be reclassified toprofit or loss
Available-for-sale financial assets		310 445
Cash flow hedges		(1,314) (933)
Exchange differences on translation of foreign operations		(31,512) (66,888)
Income tax relatingto components of other comprehensive income		12,471 314
Total other comprehensive income for theyear, net of tax		(20,045) (67,062)
Total comprehensive income for theyear		140,532 109,034

Profit for theyear attributable to:
Members of Computershare Limited		157,013 172,863
Non-controllinginterests		3,564 3,233
		160,577 176,096

Total comprehensive income for theyear attributable to:
Members of Computershare Limited		137,232 109,586
Non-controllinginterests		3,300 (552)
		140,532 109,034

Basic earnings per share(centsper share)	9	28.25 cents 31.10 cents

Diluted earnings per share(centsper share)	9	28.13 cents 31.01 cents

The above preliminary consolidated statement of comprehensive income should be read in conjunction with the accompanying notes. Restatement of prior year comparative figures is detailed in note 3.

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES PRELIMINARY CONSOLIDATED STATEMENT OF FINANCIAL POSITION AS AT 30 JUNE 2013

AT 30 JUNE 2013
	Note	2013	2012
		$000	$000
			restated
CURRENT ASSETS
Cash and cash equivalents		454,353	441,391
Receivables		330,008	332,978
Financial assets held for trading		3,083	2,764
Available-for-sale financial assets at fair value		814	635
Other financial assets		127,321	106,966
Inventories		10,646	9,268
Current tax assets		20,615	29,765
Derivative financial instruments		-	961
Other current assets		35,521	31,914
Total current assets		982,361	956,642

NON CURRENT ASSETS
Receivables		4,084	6,395
Investments accounted for usingthe equitymethod	15	28,498	27,178
Available-for-sale financial assets at fair value		5,463	6,339
Property, plant and equipment		187,873	190,910
Deferred tax assets		157,642	81,267
Derivative financial instruments		23,877	33,529
Intangibles		2,229,079	2,379,408
Total non-current assets		2,636,516	2,725,026
Total assets		3,618,877	3,681,668

CURRENT LIABILITIES
Payables		375,718	383,797
Interest bearingliabilities		8,008	69,242
Current tax liabilities		34,997	20,399
Provisions		49,534	33,438
Derivative financial instruments		-	69
Deferred consideration		7,110	21,812
Other		25,885	22,117
Total current liabilities		501,252	550,874

NON-CURRENT LIABILITIES
Payables		3,163	4,324
Interest bearingliabilities		1,703,652	1,685,149
Deferred tax liabilities		190,165	179,310
Provisions		43,090	41,123
Derivative financial instruments		-	341
Deferred consideration		40,611	53,338
Other		6,009	12,866
Total non-current liabilities		1,986,690	1,976,451
Total liabilities		2,487,942	2,527,325
Net assets		1,130,935	1,154,343

EQUITY
Contributed equity		35,703	29,943
Reserves		58,910	83,189
Retained earnings	5	1,025,231	1,028,408
Totalparent entityinterest		1,119,844	1,141,540
Non-controllinginterests		11,091	12,803
Total equity		1,130,935	1,154,343

The above preliminary consolidated statement of financial position should be read in conjunction with the accompanying notes. Restatement of prior year comparative figures is detailed in note 3.

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES PRELIMINARY CONSOLIDATED STATEMENT OF CHANGES IN EQUITY FOR THE YEAR ENDED 30 JUNE 2013

	Attributable to members of Computershare Limited
	Contributed Equity Reserves Retained Earnings Total Non- controlling Interests Total Equity

	$000 $000 $000 $000 $000 $000

Total equity at 1 July 2012 as previously reported
	29,943 90,749 1,042,965 1,163,657 12,803 1,176,460
Adjustments(refer to note 3)	- (7,560) (14,557) (22,117) - (22,117)
Total equity at 1 July 2012 restated	29,943 83,189 1,028,408 1,141,540 12,803 1,154,343

Profit for the year	- - 157,013 157,013 3,564 160,577
Available-for-sale financial assets	- 310 - 310 - 310
Cash flow hedges	- (1,314) - (1,314) - (1,314)
Exchange differences on translation of foreign operations
	- (31,248) - (31,248) (264) (31,512)
Income tax(expense)/credits	- 12,471 - 12,471 - 12,471
Total comprehensive income for the year
	- (19,781) 157,013 137,232 3,300 140,532

Transactions with owners in their capacity as owners:

Dividends provided for or paid	- - (160,190) (160,190) (2,945) (163,135)
Transactions with non-controlling interests
	- (2,740) - (2,740) (2,067) (4,807)
Equity related contingent consideration	- 629 - 629 - 629
Shares issued under dividend reinvestment plan
	5,760 - - 5,760 - 5,760
Cash purchase of shares on market	- (13,275) - (13,275) - (13,275)
Share based remuneration	- 10,888 - 10,888 - 10,888
Balance at 30 June 2013	35,703 58,910 1,025,231 1,119,844 11,091 1,130,935

Total equity at 1 July 2011 as previously reported
	29,943 152,081 1,048,403 1,230,427 15,029 1,245,456
Adjustments(refer to note 3)	- (7,560) (30,921) (38,481) - (38,481)
Total equity at 1 July 2011 restated	29,943 144,521 1,017,482 1,191,946 15,029 1,206,975

Profit for the year restated	- - 172,863 172,863 3,233 176,096
Available-for-sale financial assets	- 445 - 445 - 445
Cash flow hedges	- (933) - (933) - (933)
Exchange differences on translation of foreign operations
	- (63,103) - (63,103) (3,785) (66,888)
Income tax(expense)/credits	- 314 - 314 - 314
Total comprehensive income for the year
	- (63,277) 172,863 109,586 (552) 109,034

Transactions with owners in their capacity as owners:

Dividends provided for or paid	- - (161,937) (161,937) (1,674) (163,611)
Equity related contingent consideration	- 1,192 - 1,192 - 1,192
Cash purchase of shares on market	- (22,839) - (22,839) - (22,839)
Share based remuneration	- 23,592 - 23,592 - 23,592
Balance at 30 June 2012 restated	29,943 83,189 1,028,408 1,141,540 12,803 1,154,343

The above preliminary consolidated statement of changes in equity should be read in conjunction with the accompanying notes. Restatement of prior year comparative figures is detailed in note 3.

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES PRELIMINARY CONSOLIDATED STATEMENT OF CASH FLOWS FOR THE YEAR ENDED 30 JUNE 2013

FOR THE YEAR ENDED 30 JUNE 2013
Note
	2013 2012


	$000 $000

CASH FLOWS FROM OPERATING ACTIVITIES






Receipts from customers	2,088,980 1,917,737

Payments to suppliers and employees	(1,613,427) (1,448,190)

Loan servicing advances (net)	(25,999) (10,736)

Dividends received	135 127

Interest paid and other finance costs	(66,250) (54,868)

Interest received	4,077 4,432

Income taxespaid	(53,476) (73,943)
Net operating cash flows 17
	334,040 334,559



CASH FLOWS FROM INVESTING ACTIVITIES



Payments for purchase of controlled entities and businesses, net of cash acquired	(75,644) (658,068)

Payments for investment in associates and joint ventures	(17,205) (1,004)

Dividends received	333 287

Proceeds from sale of assets	29,405 5,618

Payments for investments	(7,521) (2,608)

Payments for property, plant and equipment	(43,735) (40,070)

Proceeds from sale of subsidiaries and businesses,net of cash disposed	10,434 1,317

Net investing cash flows	(103,933) (694,528)



CASH FLOWS FROM FINANCING ACTIVITIES



Payments for purchase of ordinary shares	(13,275) (22,839)

Proceeds from borrowings	500,764 1,131,292

Repayment of borrowings	(543,475) (459,180)

Loan servicing borrowings (net)	7,751 1,019

Dividends paid - ordinary shares (net of dividend reinvestment plan)	(154,430) (161,937)

Dividends paid to non-controlling interests in controlled entities	(2,945) (1,674)

Repayment of finance leases	(9,413) (9,978)

Net financing cash flows	(215,023) 476,703



Net increase in cash and cash equivalents held	15,084 116,734

Cash and cash equivalents at the beginning of the financial year	441,391 347,225

Exchange rate variations on foreign cash balances	(2,122) (22,568)

Cash and cash equivalents at the end of the financial year	454,353 441,391

The above preliminary consolidated statement of cash flows should be read in conjunction with the accompanying notes.

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

1. STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES

This preliminary final report has been prepared in accordance with ASX Listing Rule 4.3A and the disclosure requirements of ASX Appendix 4E.

This report is to be read in conjunction with any public announcements made by Computershare Limited during the reporting period in accordance with the continuous disclosure requirements of the Corporations Act 2001 and Australian Securities Exchange Listing Rules.

The financial report, comprising the financial statements and notes of Computershare Limited and its controlled entities, complies with International Financial Reporting Standards (IFRS) as issued by the International Accounting Standards Board (IASB).

Where necessary, comparative figures have been adjusted to comply with the changes in presentation in the current period.

The principal accounting policies adopted in the preparation of the financial statements are consistent with those of the previous financial year.

2. MATERIAL FACTORS AFFECTING THE ECONOMIC ENTITY FOR THE CURRENT PERIOD

Refer to the attached Market Announcement for discussion of the nature and amount of material items affecting revenue, expenses, assets, liabilities, equity or cash flows, where their disclosure is relevant in explaining the financial performance or position of the entity for the period.

3. PRIOR PERIOD RESTATEMENT

As a result of the Karvy Computershare Private Limited acquisition, completed in the year ended 30 June 2004, Computershare owns 50% of Karvy Computershare Private Limited. The remaining 50% is owned by Karvy Consultants Limited (Karvy). Computershare has a ‘first right of refusal’ or ‘call’ option to purchase the remaining 50% of the joint venture from Karvy, and Karvy has a ‘put’ option to sell the remaining 50% to Computershare.

The Group identified during the current period that the ‘put’ option (being over its non-controlling interest) has not been correctly accounted for under Australian Accounting Standards requirements since the transition to International Financial Reporting Standards as at 1 July 2005. From this date the accounting requirement was that the ‘put’ option must be recognised as a liability even though the payment is conditional on the option being exercised.

The incorrect treatment meant that the put option liability was omitted and therefore understated by USD 22.1 million at 30 June 2012 and USD 38.5 million at 1 July 2011. The details of these are tabled below.

Going forward, as changes in the measurement of the liability do not change the relative interests in the subsidiary, the put option liability will be remeasured through profit and loss at each reporting period. The liability changes are due to a variable option exercise price and foreign exchange revaluation (from Indian Rupees into US dollars). The impact on the consolidated statement of comprehensive income was to increase other income by USD 16.4 million in the year ended 30 June 2012. Re-measurement of the put option liability is included as a management adjustment item. There are no corresponding tax entries required.

All affected balances and amounts have been restated in these financial statements and are set out below.

Impact on profit and loss for the year ended 30 June 2012

Impact on profit and loss for the year ended 30 June 2012
	$000
Increase in other income	16,364
Increase/(decrease) in profit for the year attributable to:
Members of Computershare Limited	16,364
Non-controllinginterests	-

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

Impact on net assets and equity as at 1 July 2011

Impact on net assets and equity as at 1 July 2011
Total current liabilities Net assets Retained earnings Reserves Total equity	As at 1 July 2011 as previously reported Recognition of put option liability increase/(decrease) in other current liabilities As at 1 July 2011 restated $000 $000 $000 538,456 38,481 576,937 1,245,456 (38,481) 1,206,975
	1,048,403 (30,921) 1,017,482 152,081 (7,560) 144,521
	1,245,456 (38,481) 1,206,975

At 30 June 2011 (and 1 July 2011) the ‘put’ option liability was valued at USD 38.5 million.

Impact on net assets and equity as at 30 June 2012

Impact on net assets and equity as at 30 June 2012
Total current liabilities Net assets Retained earnings Reserves Total equity	As at 30 June 2012 as previously reported Recognition of put option liability increase/(decrease) in other current liabilities As at 30 June 2012 restated $000 $000 $000 528,757 22,117 550,874 1,176,460 (22,117) 1,154,343
	1,042,965 (14,557) 1,028,408 90,749 (7,560) 83,189
	1,176,460 (22,117) 1,154,343

At 30 June 2012 the ‘put’ option liability had decreased in value to USD 22.1 million (from USD 38.5 million at 1 July 2011, a reduction of USD 16.4 million). The reduction in value of USD 16.4 million is recorded as other income in the profit and loss for the year ended 30 June 2012.

The effect on the basic earnings per share and diluted earnings per share for the year ended 30 June 2012 is an increase of 2.94 cents per share and 2.94 cents per share respectively. There is no effect on management basic or diluted earnings per share.

4. RECONCILIATION OF INCOME TAX EXPENSE

Numerical reconciliation of income tax expense to prima facie tax payable

Numerical reconciliation of income tax expense to prima facie tax payable

	2013 2012

	$000 $000

	restated

Profit before income tax expense	192,606 226,608


The tax expense for the financial year differs from the amount calculated on the profit. The differences are reconciled as follows:



Prima facie income tax expense thereon at 30%	57,782 67,982



Tax effect of permanent differences:

Variation in tax rates of foreign controlled entities	(13,732) (21,279)

Prior year tax (over)/under provided	(667) 1,644

Research and development allowance	(2,431) (2,082)

Net other deductible	(8,923) 4,247

Income tax expense	32,029 50,512

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

5. RETAINED EARNINGS (Appendix 4E item 6)

	2013 2012
	$000 $000
	restated
Retained earnings
Retained earnings at the beginningof the financialyear	1,028,408 1,017,482
Ordinarydividendsprovided for orpaid	(160,190) (161,937)
Netprofit/(loss)attributable to members of Computershare Limited	157,013 172,863
Retained earnings at the end of the financial year	1,025,231 1,028,408

6. ADDITIONAL DIVIDEND INFORMATION (Appendix 4E item 7)

Details of dividends declared or paid during or subsequent to the year ended 30 June 2013 are as follows:

Record date	Payment date	Type	Amount per security	Total dividend	Franked amount per security	Conduit Foreign Income amount per security
20 August 2012	11 September 2012	Final	AU 14 cents	AUD 77,792,968	AU 8.4 cents	AU 5.6 cents
25 February 2013	19 March 2013	Interim	AU 14 cents	AUD 77,792,968	AU 2.8 cents	AU 11.2 cents
26 August 2013	17 September 2013	Final	AU 14 cents	AUD 77,868,431*	AU 2.8 cents**	AU 11.2 cents

Based on 556,203,079 shares on issue as at 14 August 2013

** Dividend franked to 20%

7. DIVIDEND REINVESTMENT PLANS (Appendix 4E item 8)

The Group introduced a dividend reinvestment plan on 18 January 2013.

Eligible shareholders may elect to take all or part of future dividends in the form of cash or shares in accordance with the plan rules. Shares are provided under the plan free of brokerage and other transaction costs.

Applications or notices to participate or withdraw from the dividend reinvestment plan received after 5.00pm (Melbourne time) on 26 August 2013 will not be effective for the final dividend in respect of the current financial year but will be effective for future dividends.

8. NTA BACKING (Appendix 4E item 9)

	2013	2012
		restated
Net tangible asset backing per ordinary share	(2.28)	(2.37)

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

9 . EARNINGS PER SHARE (Appendix 4E item 14.1)

	Calculation of Basic EPS Calculation of Diluted EPS Calculation of Management Basic EPS	Calculation of Management Diluted EPS


	$000 $000 $000	$000


Year ended 30 June 2013


Earnings per share (cents per share)	28.25 cents 28.13 cents 54.85 cents	54.62 cents

Profit for the year	160,577 160,577 160,577	160,577

Non-controlling interest (profit)/loss	(3,564) (3,564) (3,564)	(3,564)
Add back management adjustment items (see below)
	- - 147,846	147,846

Net profit attributable to the members of Computershare Limited
	157,013 157,013 304,859	304,859

Weighted average number of ordinary shares used as denominator in calculating basic earnings per share
	555,816,166 555,816,166

Weighted average number of ordinary and potential ordinary shares used as denominator in calculating diluted earnings per share
	558,142,604	558,142,604

	Calculation of Basic EPS Calculation of Diluted EPS Calculation of Management Basic EPS	Calculation of Management Diluted EPS



	$000 $000 $000	$000

	restated restated restated	restated


Year ended 30 June 2012


Earnings per share (cents per share)	31.10 cents 31.01 cents 49.09 cents	48.93 cents

Profit for the year	176,096 176,096 176,096	176,096

Non-controlling interest (profit)/loss	(3,233) (3,233) (3,233)	(3,233)

Add back management adjustment items (see below)
	- - 99,937	99,937

Net profit attributable to the members of Computershare Limited
	172,863 172,863 272,800	272,800

Weighted average number of ordinary shares used as denominator in calculating basic earnings per share
	555,664,059 555,664,059

Weighted average number of ordinary and potential ordinary shares used as denominator in calculating diluted earnings per share
	557,501,553	557,501,553

Reconciliation of weighted average number of shares used as the denominator:		2012 Number 555,664,059 7,713 1,829,781 557,501,553
2013
Number

Weighted average number of ordinary shares used as the denominator in calculating basic earnings per share 555,816,166
Adjustments for calculation of diluted earnings per share:
Options -

Performance rights 2,326,438

Weighted average number of ordinary shares and potential ordinary shares used as the denominator in calculating diluted earnings per share 558,142,604

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

No employee options have been issued since year end.

1,100,000 performance rights were issued with the grant date 21 September 2012 valued at AUD 7.20 each. If the vesting conditions are satisfied, the performance rights will be exercisable within six months after the financial report for the year ending 30 June 2017 has been signed. 550,000 of these performance rights have been taken into account when calculating the diluted earnings per share for the period ending 30 June 2013 as no performance condition has been attached. The remaining 550,000 have been excluded as the performance conditions have not been satisfied as at 30 June 2013.

Management adjustment items

Management adjusted results are used, along with other measures, to assess operating business performance. The Group believes that exclusion of certain items permits better analysis of the Group’s performance on a comparative basis and provides a better measure of underlying operating performance.

For the year ended 30 June 2013 management adjustment items were as follows:

For the year ended 30 June 2013 management adjustment items were as follows:
		Tax
	Gross	effect	Net of tax
	$000	$000	$000

Amortisation
Intangible assets amortisation	(105,828)	37,703	(68,125)
Strategic business initiatives
Loss on disposal of businesses	(45,874)	1,539	(44,335)
Gain on sale of equityinvestment	14,132	(2,305)	11,827
Business closure	(11,145)	658	(10,487)
Restructuring provisions	(3,875)	1,259	(2,616)
One-off items
Acquisition integration costs	(51,153)	19,122	(32,031)
DLIperformance rights reversal	8,256	(2,477)	5,779
Acquisition accountingadjustments	6,187	(1,169)	5,018
Impairment losses	(7,627)	2,902	(4,725)
Other
Indian acquisitionput option liabilityre-measurement	(6,645)	-	(6,645)
Provision for tax liability	(2,762)	1,047	(1,715)
Marked to market adjustments - derivatives	298	(89)	209
Total management adjustment items	(206,036)	58,190	(147,846)

For the year ended 30 June 2012 management adjustment items were as follows:
		Tax
	Gross	effect	Net of tax
	$000	$000	$000
	restated	restated	restated
Amortisation
Intangible assets amortisation	(79,793)	28,638	(51,155)
Strategic business initiatives
Gain on disposals	5,192	(1,466)	3,726
Restructuring provisions	(3,527)	1,147	(2,380)
One-off items
Acquisition integration costs	(9,823)	4,204	(5,619)
Acquisition accountingadjustments	5,785	4,165	9,950
Impairment charge - Continental Europe	(63,761)	-	(63,761)
Other
Indian acquisitionput option liabilityre-measurement	16,364	-	16,364
Provision for tax liability	(12,300)	5,264	(7,036)
Marked to market adjustments - derivatives	(37)	11	(26)
Total management adjustment items	(141,900)	41,963	(99,937)

10 -

COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

Below are the details of management adjustment items net of tax for the year ended 30 June 2013. Amortisation

Customer contracts and other intangible assets are recognised separately from goodwill on acquisition and amortised over their useful life in the statutory results. The amortisation expense of these intangibles for FY13 was USD 68.1 million.

Strategic business initiatives

On 30 April 2013 the Restricted Stock Services software product was sold by the USA business at a loss of USD 5.4 million. On 30 June 2013 the interactive events technology group, IML, was sold to Lumi Technologies Limited at a loss of USD 38.9 million (refer to note 16).
Gain of USD 11.8 million was recognised on the sale of the equity investment in Solium Capital Inc in Canada.
During FY13 it was decided to cease operating the Fund Services business in Australia. As a result of this decision provisions for exit costs were raised and asset write downs were taken totalling USD 10.5 million.
Restructuring provisions of USD 2.2 million were raised related to Computershare's change to a global service model impacting the USA, Canada and Australia and USD 0.4 million related to German property leases.

One-off items

Integration costs of USD 30.6 million related to the Shareowner Services acquisition from Bank of New York Mellon and USD 1.4 million related to completion of UK acquisition integrations were incurred.
As part of the FY14 budget process it was determined that it was no longer considered ‘more likely than not’ that the performance condition applicable to 50% of the performance rights granted on 12 November 2009 would be met. On this basis, the personnel expense related to prior years of USD 5.8 million has been reversed. The expense in prior periods was charged against management earnings.
An acquisition accounting adjustment gain of USD 2.1 million for the true-up of provisions related to Shareowner Services as well as contingent consideration adjustment gain of USD 3.1 million related to Serviceworks and USD 0.2 million loss related to Specialized Loan Servicing.
Impairment losses of USD 4.7 million were recognised on unlisted investments and loan transactions with equity investments.

Other

The put option liability re-measurement expense of USD 6.6 million related to the Karvy acquisition in India (refer to note 3).
Provision of USD 1.7 million was raised as a true-up of a tax liability associated with a previously identified business issue.
Derivatives that have not received hedge designation are marked to market at the reporting date and taken to profit and loss in the statutory results. The valuations, resulting in a gain of USD 0.2 million relate to future estimated cash flows.

10. SHARE BUYBACK (Appendix 4E item 14.2)

The company had no on-market buy back in operation during the year ended 30 June 2013 and the year ended 30 June 2012.

11. SEGMENT INFORMATION (Appendix 4E item 14.4)

The operating segments presented reflect the manner in which the Group has been internally managed and the financial information reported to the chief operating decision maker (CEO) in the current financial year. Management has determined the operating segments based on the reports reviewed by the CEO that are used to make strategic decisions and assess performance.

There are seven operating segments. Six of them are geographic: Asia, Australia and New Zealand, Canada, Continental Europe, UCIA (United Kingdom, Channel Islands, Ireland & Africa) and the United States of America. In addition, the Technology and Other segment comprises the provision of software specialising in share registry, employee plans and financial services globally, as well as the production and distribution of interactive meeting products. It is also a research and development function, for which discrete financial information is reviewed by the CEO.

In each of the six geographic segments the consolidated entity offers its core products and services: Investor Services, Business Services, Plan Services, Communication Services and Stakeholder Relationship Management Services. Investor Services comprise the provision of register maintenance, company meeting logistics, payments and full contact centre and online services. Business Services comprise the provision of bankruptcy and class action administration services, voucher services, meeting services, corporate trust services, loan servicing activities and utility services. Plan Services comprise the administration and management of employee share and option plans. Communication Services comprise laser imaging, intelligent mailing, scanning and electronic communications delivery. Stakeholder Relationship Management Services comprise the provision of investor analysis, investor communication and management information services to companies, including their employees, shareholders and other security industry participants.

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COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

None of the corporate entities have been allocated to the operating segments. The main purpose of the corporate entities is to hold intercompany investments and conduct financing activities.

OPERATING SEGMENTS

	Asia Australia & New Zealand Canada Continental Europe Technology & Other UCIA United States Total




	$000 $000 $000 $000 $000 $000 $000 $000

June 2013

Total segment revenue and other income
	113,038 426,467 198,037 110,241 238,124 299,645 843,233 2,228,785

External revenue and other income
	112,995 424,380 196,691 110,064 37,283 296,520 840,662 2,018,595

Intersegment revenue	43 2,087 1,346 177 200,841 3,125 2,571 210,190

Management adjusted EBITDA
	33,404 77,368 81,616 16,118 16,104 115,813 171,829 512,252



June 2012
Total segment revenue and other income
	106,820 407,171 208,525 113,417 221,005 293,368 654,376 2,004,683

External revenue and other income
	106,791 405,274 207,169 113,231 35,723 290,446 652,236 1,810,870

Intersegment revenue	30 1,897 1,356 186 185,282 2,922 2,140 193,813
Management adjusted EBITDA
	34,322 76,938 95,612 14,971 7,204 104,140 125,042 458,229

Segment revenue

The revenue reported to the CEO is measured in a manner consistent with that of the statement of comprehensive income. Sales between segments are included in the total segment revenue, whereas sales within a segment have been eliminated from segment revenue. Sales between segments are at normal commercial rates and are eliminated on consolidation.

Segment revenue reconciles to total revenue from continuing operations as follows:


	2013 2012

	$000 $000

Total operating segment revenue and other income	2,228,785 2,004,683

Intersegment eliminations	(210,190) (193,813)

Corporate revenue and other income	1,354 (3,697)

Total revenue from continuing operations	2,019,949 1,807,173

Management adjusted EBITDA

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COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

A reconciliation of management adjusted EBITDA to operating profit before income tax is provided as follows:


	2013	2012
	$000	$000
		restated
Management adjusted EBITDA - operating segments	512,252	458,229
Management adjusted EBITDA – corporate	(2,436)	724
Management adjusted EBITDA	509,816	458,953
Management adjustment items(before related income tax expense):
Intangible assets amortisation	(105,828)	(79,793)
Gain/(loss)on disposals	(45,874)	5,192
Gain on sale of equityinvestment	14,132	-
Business closure	(11,145)	-
Restructuring provisions	(3,875)	(3,527)
Acquisition integration costs	(51,153)	(9,823)
DLIperformance rights reversal	8,256	-
Acquisition accountingadjustments	6,187	5,785
Impairment charge - Continental Europe	-	(63,761)
Impairment losses	(7,627)	-
Indian acquisitionput option liabilityre-measurement	(6,645)	16,364
Provision for tax liability	(2,762)	(12,300)
Marked to market adjustments – derivatives	298	(37)
Total management adjustment items (note 9)	(206,036)	(141,900)

Finance costs	(66,615)	(48,289)
Other amortisation and depreciation	(44,559)	(42,156)
Profit before income tax from continuing operations	192,606	226,608

12. TRENDS IN PERFORMANCE (Appendix 4E item 14.5)

Refer to attached Market Announcement.

13. OTHER FACTORS THAT AFFECTED RESULTS IN THE PERIOD OR WHICH ARE LIKELY TO AFFECT RESULTS IN THE FUTURE (Appendix 4E item 14.6)

Refer to attached Market Announcement.

14. CONTROLLED ENTITIES ACQUIRED OR DISPOSED OF (Appendix 4E item 10)

Acquired	Date control gained
CJSC "EdiniyRegistrator"	20 March 2013

Disposed	Date control lost
Interactive Meetings Limited	30 June 2013
IML Limited	30 June 2013
IML Interactive UK Limited	30 June 2013
IML Interactive PtyLimited	30 June 2013
IML Interactive(Proprietary)Ltd	30 June 2013
IML BVBA	30 June 2013
IML Netherlands B.V.	30 June 2013
Interactive Meetings France SAS	30 June 2013
IML Asia Limited	30 June 2013
Interactive Meetings(Singapore)Pte. Limited	30 June 2013
IML(US)Inc	30 June 2013
IML(New Zealand)Limited	30 June 2013
IML Interactive GmbH	30 June 2013

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COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

15. ASSOCIATES AND JOINT VENTURE ENTITIES (Appendix 4E item 11)

Name Place of incorporation Principal activity Ownership interest Consolidated carrying amount	Name Place of incorporation Principal activity Ownership interest Consolidated carrying amount
June June June	June
2013 2012 2013	2012
% % $000	$000

Joint Ventures
Japan Shareholder Services Ltd Japan Technology Services 50 50 1,453	1,651

Computershare Pan Africa Holdings Ltd Mauritius Investor Services 60 60 -	-
Computershare Pan Africa Ghana Ltd Ghana Investor Services 60 60 -	-
Computershare Pan Africa Nominees Ghana Ltd Ghana Investor Services 60 60 -	-
Asset Checker Ltd United Kingdom Investor Services 50 50 -	-

VisEqGmbH Germany Investor Services 66 66 280	324
Digital Post Australia Pty Limited Australia Technology Services 80 40 3,008*	278


Associates
Chelmer Ltd New Zealand Technology Services 50 50 -	-

Expandi Ltd United Kingdom Investor Services 25 25 4,698	3,634

Milestone Group Pty Ltd Australia Technology Services 20 20 7,190	7,627

Janosch Film & Medien AG Germany Investor Services 26 27 -	-
Fonterelli GmbH & Co. KGaA Germany Investor Services 49 49 444	515
Reach Investor Solutions PtyLtd Australia Investor Services 49 35 1,294	755
Solium Capital Inc Canada Plan Services - 20 -	12,394
INVeShare United States Investor Services 25 - 10,131	-
28,498	27,178
*Digital Post Australia Pty Limited is a joint venture with an ownership interest of 80% as decisions about the relevant activities require unanimous consent of the parties sharing control.

The share of net profit of associates and joint ventures accounted for using the equity method for the year ended 30 June 2013 is USD 0.1 million loss (2012: USD 0.3 million profit).

16. OTHER SIGNIFICANT INFORMATION (Appendix 4E item 12)

The interactive events technology group IML was sold to Lumi Technologies Limited on 30 June 2013. Mr CJ Morris has a significant interest in Lumi Technologies Limited. The transaction was considered and approved by the Computershare Board (absent Mr Morris) following a formal sale process conducted by an external party. Consideration received was GBP7.8 million (USD 12.2 million) which will be adjusted for a working capital calculation. The provisional loss on disposal recognised for accounting purposes was USD 38.9 million after tax.

There have been no other transactions with Lumi Technologies Limited during the year. As part of the sale process Lumi Technologies Limited has entered into contracts with a number of Computershare entities to provide meeting services on ordinary commercial terms and conditions. As the sale was completed on 30 June 2013, the total value of services provided in the year ended 30 June 2013 was nil.

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COMPUTERSHARE LIMITED AND ITS CONTROLLED ENTITIES SUPPLEMENTARY APPENDIX 4E INFORMATION

17. RECONCILIATION OF NET PROFIT AFTER TAX TO CASH FLOWS FROM OPERATING ACTIVITIES

	2013 2012
	$000 $000
	restated
Netprofit after income tax	160,577 176,096
Adjustments for non-cash income and expense items:
Depreciation and amortisation	150,387 121,948
Net(gain)/loss on asset disposals and write-offs	49,007 (3,256)
Impairment charge - Continental Europe	- 63,761
Gain on bargainpurchase	- (16,326)
Share of net(profit)/loss of associates andjoint ventures accounted for usingequitymethod	146 (321)
Employee benefits – share basedpayments	11,925 22,577
Financial instruments – fair value adjustments	5,704 (15,032)
Changes in assets and liabilities:
(Increase)/decrease in receivables	(12,116) (647)
(Increase)/decrease in inventories	(4,401) 2,216
(Increase)/decrease in other financial assets and other current assets	(30,129) (7,403)
Increase/(decrease)inpayables andprovisions	24,846 14,377
Increase/(decrease)in tax balances	(21,906) (23,431)
Net cash and cash equivalents from operating activities	334,040 334,559

18. AUDIT STATUS (Appendix 4E item 15)

This report is based on accounts which are in the process of being audited.

19. COMMENTARY ON RESULTS (Appendix 4E item 14)

Refer to the attached Market Announcement.

20. SIGNIFICANT FEATURES OF OPERATING PERFORMANCE (Appendix 4E item 14.3)

Refer to the attached Market Announcement.

21. BUSINESS COMBINATIONS

The Group continues to seek acquisition and other growth opportunities where value can be added and returns enhanced for the shareholders.

On 20 March 2013 Computershare acquired 97.92% of CJSC “Ediniy Registrator’, a provider of share registry services in Russia. Total consideration was USD 4.5 million. This entity’s operating results have been included in profit or loss from the acquisition date.

This business combination did not materially contribute to the total revenue of the Group.

Details of the acquisition are as follows:

	$000
Cash consideration	4,517
Contingent consideration	-
Total considerationpaid	4,517
Less fair value of identifiable assets acquired	(4,517)
Provisional goodwill on consolidation	-

In accordance with the accounting policy, the acquisition accounting for Serviceworks Group, Specialized Loan Servicing LLC, Shareowner Services LLC (previously called Mellon Investor Holdings LLC) and Fakhro Karvy Computershare W.L.L (previously called Bahrain Shares Registering Company W.L.L.) has been finalised during the reporting period. This resulted in a decrease in goodwill recognised on Shareowner Services LLC acquisition of USD 6.2 million.

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AI assistant

COMPUTERSHARE LIMITED. — Annual Report 2013

64696_rns_2013-08-13_720be13d-a295-4726-b48a-2567c12d6bdd.pdf

ASX PRELIMINARY FINAL REPORT