IFRS 8 paras 22, 23, 28, profit, assets and liabilities, reconciliations and disaggregated IFRS 15 information

Diploma PLC – Annual report – 30 September 2022

Industry: distribution

2. Business Sector analysis

The Chief Operating Decision Maker (CODM) for the purposes of IFRS 8 is the CEO. The financial performance of the business Sectors is reported to the CODM on a monthly basis and this information is used to allocate resources on an appropriate basis.

For management reporting purposes, the Group is organised into three main reportable business Sectors: Life Sciences, Seals and Controls. These Sectors are the Group’s operating segments as defined by IFRS 8 and form the basis of the primary reporting format disclosures below. The CODM reviews discrete financial information at this operating segment level. The principal activities of each of these Sectors are described in the Strategic Report on pages 60 to 71. Sector revenue represents revenue from external customers; there is no inter-Sector revenue. Sector results, assets and liabilities include items directly attributable to a Sector, as well as those that can be allocated on a reasonable basis.

Sector assets exclude cash and cash equivalents, deferred tax assets, retirement benefit assets, acquisition related assets and corporate assets that cannot be allocated on a reasonable basis to a business Sector. Sector liabilities exclude borrowings (other than lease liabilities), retirement benefit obligations, deferred tax liabilities, acquisition related liabilities and corporate liabilities that cannot be allocated on a reasonable basis to a business Sector. These items are shown collectively in the following analysis as ‘unallocated assets’ and ‘unallocated liabilities’, respectively.

Acquisition related and other charges are £46.9m (2021: £44.4m) and comprise £42.4m (2021: £33.1m) of amortisation of acquisition intangible assets, £10.5m of acquisition expenses as defined in note 27 (2021: £9.7m), a £7.3m (2021: £1.6m net charge) net gain on the disposal of businesses, which is set out in note 21, and one-off restructuring costs of £1.3m associated with the transition of the Group’s Chief Financial Officer.

Other Sector information

Accrued income (‘contract assets’) at 30 September 2022 of £0.1m (2021: £0.8m) and deferred revenue (‘contract liabilities’) of £3.5m at 30 September 2022 (2021: £2.5m) are included in trade and other receivables (note 15) and trade and other payables (note 16), respectively.

3. Geographic segment analysis by origin

1 Non-current assets excludes deferred tax assets, derivative assets and the retirement benefit asset.