civica annual review 2013

Transform the way you work

Civica Group2013 Annual Review

Welcome to Civica

Civica is a market leader in specialist systems and business process services that help front line organisations around the world to transform the way they work.

We provide software applications, cloud services and IT-enhanced outsourcing to bring about improved and more efcient services for our customers.

Above all in the markets we serve, people matter. Combining exceptional customer focus, experience and commitment, it is the people of Civica and our culture that sets us apart.

More than

2,000employees

At

30locations around the world

Supplying over

2,500front line service organisations

Compound revenue growth of

9%over the last 10 years

02 www.civica.co.uk

02 Welcome to Civica

04 Civica at a glance

06 Our vision and strategy

08 Group business highlights

10 Business review and outlook

14 Focus on Markets

16 Local government

18 Education & libraries

20 Health & social care

22 Housing & asset management

24 Public protection

26 Regulated markets

28 International

30 Focus on Services

32 Software & systems

36 Cloud services & outsourcing

40 Focus on People

46 Focus on Finance

48 Financial review

Contents

Civica 2013 Annual Review 03

Civica is a strong, stable and growing partner for our customers

Civica at a glance

Providing cloud-based services for

400customers

A partner for

1,000local government organisations

Delivering to

400health & care providers

Helping pension, utility and support organisations to enhance services and administration

Providing systems to administer over

90 billion of funds or expenditure

Every day we help more than

1 millionprofessionals in their jobs

Streamlining service delivery to

40 million people and businesses

04 www.civica.co.uk

Digitising

150 million documents to enable efcient electronic processes

Supporting

75%of the UKs blue light services

Supporting

5,000schools and libraries


We encourage our people to develop their full potential in an open and supportive environment, guided by our core values of:

Our vision and strategy

Our goal is to be the leading IT-based services partner in our chosen markets in the UK, Australia, New Zealand, South East Asia and North America.

CUSTOMER SERVICE

Deliver excellent service through a consistent and

customer-focused approach.

OPERATIONAL EFFICIENCY

Optimise efficiency in all areas to deliver maximum value to all stakeholders.

OUR PRIORITIES

FINANCIAL

Deliver stable and profitable growth through achievement

of market-leading performance for the Group.

PEOPLE & ENVIRONMENT

Maintain a culture that supports our values and our commitment to the

wider community.

PRODUCTS & SERVICES

Bring to market innovative products & services focused

on helping customers totransform the way they work.

OUR VISIONTo be the leading IT-based

services partner in our chosen markets, helping customers to succeed through our unique

combination of people, technology and business

process expertise.

OUR STRATEGY

BUSINESSPROCESS SERVICES

Expand our business process outsourcing

and OnDemand services to transform

service delivery and efficiency for customers.

SOFTWARE& SYSTEMS

Develop the use of our mission-critical software systems to

automate core business processes and deliver greater

operational efficiency and reliability for customers.

CLOUD-BASED SERVICES

Extend our cloud and managed services to help organisations reduce cost and risk, increase flexibility and speed up

adoption of modern technology.

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Customer value

Our people combine in-depth knowledge of our customers business with expertise in service delivery and technology. With a clear vision to help customers do more, do better and spend less, we build on that knowledge to facilitate, improve and ultimately transform a wide range of customer business processes. Its what makes us the leading provider of our kind.

PLATFORM-BASED OUTSOURCING

Transform

ENTERPRISE AND CLOUD SOLUTIONS

Improve

CORE BUSINESS SYSTEMS

Facilitate

Eastbourne Borough Council

Award-winning transformation programme to underpin

a restructured organisation, deliver innovation and enable savings of 3 million through

a digital foundation for core processes.

Gloucester City Council

Innovative revenues & benets partnership to improve

services and sustain local jobs while delivering 1.5 million

savings achieved best council tax collection performance

in 2013.

Belfast Health & Social Care Trust

Electronic patient record and case management system

for 5,000 clinical staff to enhance the joined-up delivery

of safe, timely and high quality community health

and social care.

Specialist applications to automate the delivery

of reliable, responsive and efcient business

activities.

IT systems and services that deliver new and more productive ways of working

and efcient models to harness technology.

Business process services enabled by automation

which deliver step change improvements in the cost and resilience of services.


2013 Group business highlights

For the year ended 30 September 2013

213.2 million

98.3 million

730 million

(2012: 201.9 million) (2012: 91.8 million) (2012: 700 million)

Group revenues Recurring revenues Closing order book in excess of

19.9% 42.4 million

98% of EBIT(2012: 18.8%) (2012: 38.0 million) (2012: 97% of EBIT)

EBITDA margin Normalised EBITDA Cash ow from operating activities

2,082 93%(2012: 1,919) (2012: 93%)

Employees (at 30 September) Employee retention

Note: For key performance indicators see page 53.

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North America4.3 million (2012: 4.3 million)

Singapore & SE Asia10.9 million(2012: 12.0 million)

Revenues by geographical region

United Kingdom151.3 million(2012: 140.4 million)

Australia & New Zealand46.7 million (2012: 45.2 million)


10 www.civica.co.uk

Simon DowningChief Executive Ofcer

Business review and outlook2013

2013 was another positive year for Civica. We achieved an excellent nancial and operational performance and maintained our track record of growth which is delivering benets for customers, employees and stakeholders.

As we continue to enhance our market position the business is well placed as a strong and stable partner of choice for customers across the markets we serve.

Focused on service delivery areas of the public sector and other markets in the UK and internationally, Civica products and services are used to streamline and automate operational processes, underpin organisational efciency and deliver transformative change. During the year we continued to respond to customer requirements which include extending the use of technology and the involvement of partners to address nancial and service pressures.

Trading results

Group revenues in the year to 30 September grew by 6 per cent to 213.2 million (2012: 201.9 million), led by the UK business with good organic growth in local government and in cloud and managed services and with an increased presence in health care and education. EBITDA* increased to 42.4 million (2012: 38.0 million) supported by good cash generation which has enabled sustained investment in our products, services and resources.

During a period of increasing change in our markets we continued to grow both customer and employee numbers. Underpinned by a clear strategy and a reputation for domain expertise the Group made further progress in all areas of focus including software, cloud-based services and business process outsourcing. Revenues from the latter increased by 65 per cent over the previous year with excellent new wins and a strong pipeline of opportunities.

We continued to invest in and enhance the Groups market-leading software portfolio, and to grow our customer base through a combination of excellent retention and new business. This included new sales for more than 120 customers including good progress with major change programmes to help organisations re-design and digitise their services. Civica applications also appeared for the rst time on the UK Governments G-Cloud procurement framework.

Growth in services saw recurring revenues increase 7 per cent organically to 98.3 million. Momentum included new provision for over 100 organisations as we continue to expand cloud and managed services activity in response to market demand, supported by further investment in our data centre infrastructure. Cloud-based provision is now the preferred model for many or our market sectors.

The Group made further excellent progress in outsourcing particularly in platform-based BPO for local government where our compelling proposition of service improvement and savings has secured a strong and growing market position for Civica. Existing partnerships such as at Gloucester City Council delivered a very good performance and the Group secured new agreements including Forest of Dean, Lambeth Schools and USS, together with a ground-breaking shared service partnership in South Worcestershire to deliver revenues and benets services and save 3 million for Malvern Hills, Worcester City and Wychavon councils.

> continued

Civica is one of the best performing players in the UK public sector market. It is the Groups stability, domain expertise and closeness to its customers that set it apart from competitors.

TechMarketView LLP // January 2014

The Group produced a strong performance in 2013 as we continue to deliver sustainable, protable growth and build a leading market position to support the needs of our customers and the long-term development of Civica.

* Earnings before interest, taxation, depreciation and amortisation.


12 www.civica.co.uk

The Group continued to benet from balanced operations across markets and geographies. The UK remains Civicas largest market with revenues increased 9 per cent in the year to 151.3 million, representing 71 per cent of overall turnover. We continued to build on our track record with existing customers in core markets with new opportunities emerging and a growing presence in education and health care. Civica also made successful inroads into the central government sector including engagements with Transport for London, the Department for Transport and, following the end of the nancial year, the Department for Education.

In a very positive development to support our continued growth and the future success of the business the Group was acquired in May 2013 for an enterprise value of 390 million by OMERS Private Equity, the investment arm of the OMERS pension plan. Following strong growth over the last 10 years the backing of OMERS, with assets of more than $60 billion, ensures Civica has the resources to build on our plans for the long-term development of the business under the continued leadership of the management team.

Acquisitions

Civica continued its successful record of selectively acquiring and integrating complementary businesses which enhance our market position and extend the Groups capability in line with our vision and strategy.

We successfully completed the acquisition of education software provider Corero Business Systems, an award-winning supplier of nancial, student and business management systems in the UK. The business continued to perform very well post acquisition and, following the launch of an integrated education division in the UK supplying more than 1,000 schools and colleges, the Group is strongly placed to respond to the changing needs of the sector.

Following the end of the nancial year, Civica also acquired the local government software business from InfoMaster Pty Limited, a specialist in planning and development management software for authorities in Australia, and then in early 2014 acquired Coldharbour Systems Ltd, a market leader for the UK care sector.

With the strong support of OMERS, Civica remains very active in reviewing potential acquisition opportunities to increase scale and capability in core markets and adjacent niches.

People & customer service

Our people, their domain expertise and their commitment to do well for customers represents a distinctive strength for Civica which underpins our performance as an innovative and growing partner. We continued to expand in 2013, passing 2,000 employees. We have added close to 400 people in the last two years and as the company has grown we have maintained the focus on developing the skills and customer service values of our people. During the year we were delighted therefore to achieve the prestigious Investors in People Gold accreditation.

Supported by our increasing scale and reputation, and with a distinctive culture which is a strong t for our customers, Civica continues to attract skilled individuals with specic market, technical and operational expertise. During the year we completed successful and positive TUPE transfers and following the end of the nancial year welcomed 111 new employees who joined with the South Worcestershire Partnership.

The Group has continued with investments to ensure the company is a great place to work and to enhance customer service. These include the Civica Academy, to support effective employee development and talent management, development of graduate and apprenticeship programmes and a variety of community and charitable support under the Civica Foundation.

Outlook

2013 was a year of growth and development for Civica and the Group has continued to win new and innovative business into 2014. Our clear focus and consistent, successful delivery have again provided benets to all stakeholders and on behalf of the Board I would like to thank all of our people for their commitment in producing a market-leading performance.

Civica is one of the fastest growing major providers to our markets. We have an increasing global prole as a market leader, valued for our combination of people, technology and business process expertise. With a resilient business and well developed strategy, we believe the Group is extremely well placed as a strong and stable partner for our customers as they continue to change the way they operate in response to rapid and signicant change.

We remain committed to the ongoing development of Civica and to sustaining our track record of controlled, above market growth which extends over more than 10 years. With an order book of over 730 million and high levels of recurring revenues derived from long-term contracts and the transition of more customer activities to a managed or outsourced basis, the Group has good revenue and earnings visibility.

Given our market position and investments made during the year, we remain very positive about the outlook for the business.


Blending the capability and experience of a large company with the commitment, exibility and expertise of a specialist, Civica is well placed to help customers address current nancial and service pressures.

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Focus on Markets Making a difference to people and places


Every day our products and services

help professionals across local

government, education, health care,

community protection and regulated

services to deliver responsive services,

reduced costs and better outcomes.

16 www.civica.co.uk

Providing market-leading software systems, cloud services and specialist outsourcing focused on customer service delivery and administration, Civica is helping local authorities to maintain and improve services while spending less.

Local government

1 billion400 12 millionUK councils supported by Civica of payments processed via the

cloud annuallysavings targeted by Luton Borough Council partnership

The support of our partner Civica is helping us to explore bold new ground.

Jack Hegarty // Managing Director, Wychavon District Council


Eastbourne Borough Council

Civica is a key partner for Eastbournes award-winning programme to re-design services and move to a digital foundation. Underpinned by paperless working the transformation is helping to improve services and save 2 million through integrated processes, agile working and efcient multi-channel engagement.

The Future Model programme has embedded a more customer-centric way of working. Multi-disciplinary teams

provide citizen-focused services under a single management structure, supported by a central customer database, electronic document management and a digital mail room which saved more than 350,000 in the rst year.

By empowering staff to deal with enquiries, Eastbourne has been able to maintain and improve service levels while saving up to 20 per cent compared with original departmental baselines.

Review of operations

Civica maintained its record of growth in local government, with overall revenues from the sector increased by 7 per cent. During a sustained period of change for local authorities, including signicant welfare reform, the Group extended its market position through new contract wins, further penetration of software applications into the customer base, and successful product and service delivery.

Driven by immediate and evolving customer needs Civica continued to grow the use of the companys specialist software while extending the scope and scale of cloud and business process services.

Excellent progress in outsourcing included agreements at Forest of Dean in conjunction with Gloucester City Council and a strategic shared service partnership in South Worcestershire to deliver revenues and benets services and save 3 million for Malvern Hills, Worcester City and Wychavon District Council, creating a centre of excellence in Pershore.

Existing partnerships performed well, achieving the best ever council tax collection for Gloucester City while

delivering annual savings of 220,000. OnDemand services were provided by the Severn Centre to 20 authorities including contracts to deliver Local Welfare Assistance on behalf of Barnet, Durham and Hampshire. Following the end of the nancial year Civica secured a new agreement with Gloucester to outsource IT services.

With councils looking to modernise services and make savings through digital transformation, Civica continued to develop the use of its software including integrated customer service solutions to support digital engagement and more agile working, underpinned by automated workow and document management. The company extended its transformation programme at Eastbourne, helping the award-winning authority move towards a fully digital foundation, and was also selected as a supplier to the Wandsworth-led London Digital Framework.

In addition to signing more than 40 contracts for its market-leading business systems, Civica delivered new software on time to implement a high volume of signicant new legislation. This included benet capping, which saw the London

Borough of Eneld win a national award for innovation, the local council tax reduction system and a new application for Discretionary Assistance which was adopted by 28 existing and new customers.

Strong momentum with payment systems saw more than 30 customers going live with cloud-based solutions underpinned by a PCI-compliant data centre network. New wins for payment and cash receipting solutions included, among others, Norwich City Council, Rushcliffe Borough Council and North Hertfordshire. Enhancements to improve customer experience included PayPal integration and eStore, a self-service portal providing industry-standard personalised payment facilities across council services, including pre-payment.

The opportunity to improve and automate internal back ofce processes continued to drive demand for web-based solutions including, among others, nine new customers for nance and legal management systems to streamline operations and reduce cost and risk, including cost effective self-service capabilities.

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Civica works with schools, academies, colleges and libraries to bring about improved teaching and learning for the benet of students, teachers and the community through business and administration software, exible ICT services and cloud computing.

Education & libraries

9001 million 12.7 millionschools and colleges provided with nancial and HR software

students provided with access to day-to-day applications

people served by pioneering SELMS, AGMA and SPINE library consortia

We chose Civica quite simply because of the quality of what they offer and value for money.

David ONeill // ICT Strategy Manager, Lambeth Children and Young Peoples Service


Lambeth Learning Futures

Civica is working with the London Borough of Lambeth to deliver Lambeth Learning Futures, an 8-year ICT partnership to support approximately 10,000 users including a refresh programme and provision of ICT services from the cloud.

Integrated service management is at the heart of the partnership combining remote service desk with onsite support. Schools benet from the exibility of Civicas modular approach which allows

them to choose additional services, from virtual desktop infrastructure to online learning environments. Integration with the London Grid for Learning gives students and staff full access to resources and networks.

Future innovations are expected to include greater use of mobile technology, a customised learning portal and extended services for other primary and secondary schools.


Civica continued to perform well in education and libraries during the year, achieving good growth and a stronger market position as a result of new contracts and the successful delivery of innovative IT services, cloud solutions and specialist software focused on improving teaching and learning.

In August 2013 Civica acquired Corero Business Systems, an award-winning supplier of accounting, business and management information systems with a strong record in helping institutions align and improve back ofce administration, nance, HR and payroll functions. The acquisition extended Civicas position in the sector, providing a broader capability across an enlarged customer base of more than 1,000 UK schools and colleges.

In total the acquired business won orders from over 250 new academies and schools during the year to September 2013. It continued to trade well post acquisition with new contracts including, among others, St Pirans Multi Academy Trust and the Leeds Jewish Free School and, following the end of the nancial year, was successfully integrated as part of a re-launched education business with a distinctive combination of technology and expertise.

Working alongside schools and colleges to enhance learning and reduce costs through exible IT solutions and specialist services Civica continued to win new contracts with a broad range of local authorities, academies, free schools, studio schools and university technical colleges. More than 25 new agreements included, among others, William Perkin Church of England School, St Birinus School and Buckinghamshire UTC.

Building on its track record in large-scale programmes the company signed an 8-year partnership to deliver a new ICT managed service for Lambeth Schools to support approximately 10,000 users with a exible, modular service tailored for each school. Following the end of the year, Civica was also selected as preferred bidder for ARK Schools, one of the countrys top academy operators.

Supported by employee transfers, the company continued to deploy virtual desktop infrastructure, cloud-based learning platforms and IT services including more than 30 new schemes during the summer ahead of the new school term. Civica has now delivered ICT programmes on time for 100 Education Funding Agency (EFA) schools.

The Groups exible learning-led model enables institutions to embed ICT-based teaching and administration even where budgets may be limited, supported by planning, change management and training.

In the libraries sector Civica is a leading supplier with wide experience across all types including public, academic and corporate. As library services look to address signicant pressures, the Group secured new contracts including, among others, East Sussex County Council, South Lanarkshire and Bolton Libraries, the latter building on multiple partnerships within the Association of Greater Manchester Authorities to provide a shared system underpinning services for 1.5 million citizens.

The trend towards consortium solutions hosted by Civica continued, and following recent growth the 12-member South East Library Management (SELMS) consortium, which operates a common managed IT system and shared resources, extended member contracts to 2017.

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Civica works with health and social care providers and commissioners to deliver software and services that streamline the management of integrated care and improve patient services. The Group supplies three quarters of NHS Foundation Trusts together with providers in Wales, Northern Ireland and Canada.

Health & social care

of Acute Trusts using service level and costing software

80%NHS Trusts supported by Civica systems

200 documents and images scanned annually

140 million

Providing clinicians and administrative staff with information at the touch of a button will transform the way patients are treated and help us make huge savings.

Diane Murphy // Clinical Director of Service Transformation, County Durham and Darlington NHS Foundation Trust


County Durham & Darlington NHS Foundation Trust

Civica is working with County Durham & Darlington, one of the largest integrated care providers in England, to digitise patient records and transform the way information is managed as part of its paperless NHS strategy to improve patient care and achieve signicant cost savings.

Adoption of Civicas WinDIP software provides clinical and administrative staff with faster access to vital patient information and enhanced communication

between different teams, helping to improve clinical decisions and save valuable time. It ensures that accurate and up-to-date patient information is securely accessible from any location.

As well as minimising the risk of lost patient records through paperless working, the new system will help to reduce transport, storage and administrative costs.


Civica delivered an excellent performance in health & social care during 2013 with revenues from the sector increased by more than 40 per cent compared to the previous year. Improved demand following a period of signicant structural market change led to good momentum and a growing footprint with more than 25 new contracts.

The company continued to win new customers for its integrated electronic patient record (EPR) and case management system for community-based care, including new deals worth 3 million with Greater Manchester West NHS Foundation Trust, Southern Health & Social Care Trust and Western Health & Social Care Trust.

Together the Southern and Western Trusts cover ten local government areas in Northern Ireland. Conrming the Groups strong position in the country following success at Belfast, the agreements demonstrated the strength and the suitability of the Paris system for integrated health and social care, increasingly a focus for Government strategy for England and Wales.

As a leading provider of service line reporting, patient level costing, contract management and commissioning solutions, Civica continued to make good progress following NHS re-organisation. The company grew the number of Trusts,

Clinical Commissioning Groups (CCGs) and Commissioning Support Units (CSUs) supplied. Examples included the Royal Devon & Exeter NHS Foundation Trust, one of the earliest Foundation Trusts with a reputation for innovation, which contracted for SLAM and Cost Master software to deliver an integrated Service Line Reporting platform. The NHS North of England CSU also extended its use of SLAM which now serves all 13 CCGs in the North of England region.

With patient-level information and costing increasingly important in the mental health sector Civica strengthened its position with new engagements including, among others, Northamptonshire Healthcare NHS Foundation Trust and West London Mental Health NHS Trust.

The need to digitise health records to improve services and deliver savings continues to drive a high level of interest in document and records management. Civica grew the use of its market-leading electronic document software and digitisation services which is now used by more than 50 Trusts. New customers included, among others, Epsom & St Helier University Hospitals NHS Trust, South West Yorkshire Partnership NHS Foundation Trust and County Durham & Darlington NHS Foundation Trust.

With Government policy supporting investment in healthcare IT, Civica remains well placed in line with major areas of market interest and as Trusts look to procure technology not delivered by the erstwhile National Programme.

Following the end of the year Civica announced another major development with the acquisition of Coldharbour Systems, the market leader in the provision of nancial, accounting, staff and care management systems for the UK care sector. Supplying more than 160 providers of residential, community and nursery care, Coldharbour has a strong history of helping customers to streamline nancial processes, control cost and reduce risk, and the two companies have a successful record of working together.

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A leading partner in social housing, Civica provides a exible IT-based platform to help organisations deliver improved tenant services with greater efciency. Similarly, the Groups market-leading solutions drive cost and utilisation benets for public and private sector eet operators.

Housing & asset management

1 million 3.6 million 250,000 IT-based savings created at Golden Gates Housing Trust

properties managed using Civica technology

vehicles maintained and managed using Tranman software

Over the last ve years our relationship with our tenants and the way we do business has transformed for the better. This is in no small part thanks to Civicas technology and services.

Peter Fitzhenry // Director, Golden Gates Housing Trust


Leeds Federated Housing Association

Civicas integrated housing system is helping Leeds Federated to streamline operations across the organisation as part of the Associations service transformation programme to improve core services and create efciencies.

Replacing software from multiple vendors, the system has enabled the Association to centralise operating processes and enhance management of all activities including communication

with tenants, planned maintenance, responsive repairs, rent accounting, arrears and tenancy supervision.

As well as supporting the delivery of improved and more efcient services with better communication between departments and reduced manual processing, the system enables Leeds Federated to capture and analyse key data across the business and ensure a high level of service is maintained.


With a clear focus on supporting improved tenant services the Group maintained a good performance in the social housing sector, combining progress with existing and new customers with product development and innovation.

During the year Civica launched its latest technology for the sector, Housing Cx. The rst fully web-enabled housing management application, Cx is a cloud-based solution developed to help organisations deliver a transformed customer experience and anticipate changing demands while achieving IT-based savings.

Combining a modern interface and any time, any device accessibility for applicants, tenants and staff with integrated customer management, Cx provides the foundation for responsive, personalised and efcient housing services. Initial commitments included a 7-year contract with Golden Gates Housing Trust to build on its successful track record and Railway Housing Association.

Civica continued to win new customers including, among others, Basildon Housing Services and Magenta Housing. Existing customers also chose to extend services including the roll out of Tenant Services, Contractor Integration and CRM solutions to support evolving business needs and utilising Civicas open API web services. These facilitate channel shift and improved customer service, helping organisations to change the way they work in response to social and welfare reform.

The combination of welfare reform, social trends and nancial constraint is driving housing associations to change the way they operate. Technology has a major role to play and Civica remains well placed to help organisations adapt through more agile and IT-enhanced ways of working.

Asset management

Civica provides a range of market-leading software for eet and vehicle asset management. During the year the Group continued to build on its strong position with existing and new customers, with

new business momentum including, among others, Helena Partnerships, Doncaster Council, Nottinghamshire Police and Cumbria County Council.

The company signed signicant new agreements with the National Police Air Service, as part of a programme to save up to 15 million compared to previous arrangements for police air support, and with Babcock Airside for quick delivery of a system to manage over 3,000 vehicles to support its contracts with British Airways and BAA and enable Babcock to achieve 99 per cent critical availability while reducing costs and delivering CO2 savings.

Civica continued to deliver innovative technology, including a touchscreen application for supermarket chain Morrisons to improve productivity in its vehicle maintenance units, a dashboard for grey eet management and a self-service pool car booking system which helped Dumfries & Galloway Council achieve savings of more than 280k in the rst year.

Civica works with local authorities, blue light organisations and government agencies to help safeguard people and places and to deliver efcient customer services and administration through leading solutions for regulatory, enforcement and community safety services.

Public protection

90%240 1.2 million

24 www.civica.co.uk

of UK Police forces and Fire services use systems developed by Civica

public protection and enforcement customers

people served by hosted call handling system for Citizens Advice

By redesigning processes and embracing change, both organisations were able to deliver an ambitious project to support large front line services.

Mark Grifn // Head of Waste Strategy, London Borough of Hackney


London Borough of Hackney


The Group works with an extensive customer base of organisations with a common focus on public and environmental protection and at the end of 2013 established a more integrated business focused on community protection.

Spanning local authority regulatory, environmental, land and property services together with enforcement and emergency services Civica continued to build on a strong track record including new contracts with, among others, the London Borough of Waltham Forest, West Yorkshire Police and Humberside Fire and Rescue Service.

The company maintained a strong record of project delivery with its integrated public protection software, for example for the London Borough of Hackneys Environmental Quality Information System (EQuIS). As authorities focus attention on the savings available through process automation and customer self-service, Civica made progress with web access channels included the introduction of new Public and Partner Services and Community Map products.

As the leading provider of applications to manage the licensing of businesses and individuals, Civica strengthened

its position with 16 new conversions, together with successful delivery of a new hosted system for taxi and private hire vehicle licensing in London to help Transport for London and prime contractor NSL to deliver improved licensing and compliance.

In addition the company delivered new software with the focus on supporting operational efciency. This included a new dashboard application to provide improved management information and reporting adopted by more than 20 customers and a new cloud-based application to administer the Community Infrastructure Levy.

Growing use of computerised mapping to visualise, plan and deliver efcient services including online self-service continues to drive interest in geographic information systems (GIS). Civica extended its position with existing and new customers including good progress with mobile GIS. Mobile applications providing any time, any device access to live data were provided for, among others, Cambridgeshire Fire & Rescue Service to support improved re risk management and Peterborough City Council, which implemented a tablet-based system to help manage ood risk and drainage assets.

The Groups re risk management information system helps to maximise risk reduction and increase productivity through better management and targeting of re safety resources and, as in other sectors, Civica made progress with a number of re services adopting new online capabilities.

Civica continued to develop the use of its front line and back ofce systems with customers in civil and police enforcement. An established provider of specialist police systems, the company was part of the Vauxhall-led consortium which won the Association of Chief Police Ofcers challenge to design the Police Car of the Future. Incorporating Civicas automatic number plate recognition (ANPR) technology with the consortiums sophisticated in-vehicle computing and communications the car was designed to improve the job of front line policing.

Hackney Council has implemented a new unied waste management, environmental enforcement and licensing system developed with Civica. The EQuIS system has improved service delivery and saved time through streamlined and joined up working across 11 service areas.

Recognised at the UK IT Industry Awards for the best use of collaborative technology, EQuIS replaced multiple back ofce applications for commercial

and domestic waste operations. It now provides a unied system that enables service teams to track requests, automate workows and integrate with call centre and online channels.

Providing a single view of the customer, the system has facilitated the re-structure of services, delivering savings on processing time and virtually eliminating commercial waste reconciliation errors.

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Civica is a growing supplier to regulated service markets including pension administration, utilities and legal services, helping organisations to deliver enhanced customer service, greater productivity and efcient administration.

Regulated markets

3,500users of business critical GIS system at Yorkshire Water

43 billion of funds managed using Civicas pension administration systems

20 million asset records managed with geospatial systems

We remain delighted with our choice of administration system and what we have achieved to date through its use.

Peter Dyer // Head of Administration, Hymans Robertson


Universities Superannuation Scheme

Civica is working in partnership with the Universities Superannuation Scheme (USS), trustee of the largest pension fund for the higher education sector, to deliver an increasingly efcient, secure and resilient ICT infrastructure for the organisation.

USS chose Civica to provide a scalable, exible and agile cloud-based infrastructure to ensure the organisation continues to provide a fast, effective and secure service to customers.

Consolidation and virtualisation of the ICT estate will help USS to transform ICT capabilities and support the growth of its services while securing cost efciencies.

The two organisations have a successful history of working together to develop the pension management software used by USS and to deliver an improved service for members.


Civica is established in a number of regulated service markets including pension administration, utilities and legal. With a growing position the Groups products and services help organisations to deliver better service, greater productivity and efcient administration.

Pensions

Civica maintained good sales-led growth in the pensions sector across all areas of Group strategy including owned software, cloud-based services and outsourcing, with successful delivery to a broad range of scheme providers and administrators.

Extending its existing software-based relationship the Group signed a long term contract with the Universities Superannuation Scheme (USS), trustee of the largest pension fund for higher education organisations, to virtualise all of its ICT operations and deliver a exible and scalable cloud computing infrastructure.

Civicas Universal Pensions Management software provides for all types of scheme and is used by some of the largest funds in the UK. The company was ranked top systems provider in the 2013 Professional Pensions Administration Survey.

New contracts included electronic document management for the Northern Ireland Local Government Ofcers superannuation scheme, a cloud-based solution for a major retailer and a 10-year agreement with the Pension Protection Fund for an administration and payroll system to support the transfer of member services in-house.

Building on a strong track record with administrators of the Local Government Pension Scheme, Civica gained further momentum and following the end of the companys nancial year, secured new agreements for Hampshire County Council, Essex County Council and the South Yorkshire Pensions Authority.

Infrastructure & utilities

The Group provides geographic information system (GIS) and asset management solutions to help improve essential services such as water management, energy distribution and transportation.

With increasing business value of geospatial data for managing assets, operations, customer contact and incidents, Civica continued to develop the use of its web, desktop and mobile

GIS software. Progress included a new framework agreement with Yorkshire Water to adopt Civicas latest web-based solutions, deployment at the London Legacy Development Corporation and a contract with the Department for Regional Development in Northern Ireland to underpin management of roads infrastructure.

Used to manage more than 250,000 vehicles, the Groups market-leading eet management systems also enable cost and utilisation benets for customers. Civica continued to respond to customer demand, for example extending the relationship with Western Power Distribution to support the growth of operations across the Midlands with increased productivity.

Legal

Civica delivers practice management, time recording, billing and case management systems used by legal teams to streamline and automate activities. During the year Civica launched a new client portal for customers and secured a number of initial orders, and also acquired the ARMS business from Revitas.

28 www.civica.co.uk

Civicas international business focuses on local government, library, education and health sectors, with a market-leading position in Australia, New Zealand and Singapore. During the year the Group continued to build on its strong position.

International

4,000300 12,000schools supplied with systems and technology

councils supported by Civica in Australia & New Zealand

library staff supported in their jobs

The opportunity to partner with Civica to become a leading local government organisation is an important step in our long-term development plan.

Marnie Williams // Executive Manager, Maribyrnong City Council


Shire of Esperance


International business produced 28 per cent of Group revenues during the year. Civica continued to reinforce its substantial operations and to develop the use of its software and services, notwithstanding softer demand in some sectors.

Local government

In Australia and New Zealand more than 300 councils use Civicas enterprise applications to deliver responsive and efcient administration. New contracts included, among others, Shoalhaven City Council, Douglas Shire and Maribyrnong City Council, the latter selecting Civicas Authority suite to replace eight separate systems to enable broader transformation. Momentum with specialist applications included 14 executive management system implementations.

The company launched its latest cloud platform providing a highly scalable, virtualised, multi-tenant environment. Successful migrations included Shire of Esperance which adopted the new managed cloud service for 15 council applications including the Authority suite.

Acquisition of the local government software business of InfoMaster Pty in October 2013 added to Civicas

substantial portfolio, providing customers with access to planning and development management software used by more than 40 authorities.

In the United States, Civica CMI continued to make good progress with a comprehensive range of local government software including income tax collection, nancial and asset management, payroll and utility billing.

Education & libraries

Civica sustained good momentum in the schools sector in Australia where it is one of the leading providers of management systems and classroom technology. Progress included doubling the customer base for its Maze managed service and the launch of its latest cloud hosting service.

Business wins included a new 5-year agreement with the Catholic Education Ofce of Western Australia worth 3.8 million to provide Civicas Education suite to 150 schools including managed service delivery in almost half, and a contract with the Department for Education and Early Child Development in Victoria for online teaching tools and attendance software for use in 1,200 schools.

With libraries under pressure to achieve greater efciency, the Group launched its latest technology for the sector. Spydus 9 is a web-based system with full smartphone and tablet support to deliver modern self-service and management capability for libraries and archives. During the period more than 30 per cent of customers chose to adopt the new product.

Building on its track record in South East Asia the Group signed, among others, an extension to its outsourcing contract with the Singapore Ministry of Education and a new agreement with Nanyang Polytechnic Library. The rst stage of a new system for the Singapore National Library Board, including conversion of 9 million records, was completed ahead of time, now processing 1 million loans weekly.

Health

The Group continued to deliver a good performance with its fully integrated solution for health insurance administration, supporting member services for health fund providers including NIB and ahm, together with delivery of software to implement signicant new legislation.

The Shire of Esperance in Western Australia has moved to Civicas Cloud platform for the provision of all strategic IT applications including the companys Authority local government enterprise suite.

Civica manages 15 council software applications via its data centre environment, from its own market-leading local government software to Microsoft Ofce. The Cloud platform delivers

a highly scalable and secure virtualised environment, providing the foundation for assured and efcient operations while eliminating the need to manage system integration.

Moving to the new service over the course of a weekend, the Shire has benetted from enhanced user experience and performance, underpinning improved service delivery and efciency.

30 www.civica.co.uk

Focus on Services


Civicas specialist systems and

technology-enhanced outsourcing

services provide the means for customers

to achieve successful outcomes. A unique

combination of people, technology

and business process expertise make

the company a trusted partner for

transformational change in the delivery

and efciency of essential services.

32 www.civica.co.uk

Civica provides a leading range of specialist applications together with the business process and integration expertise to facilitate the delivery of streamlined services. Providing the technology platform to drive cost-efcient and customer-focused ways of working, the Group achieved strong growth during 2013.

Software & systems

growth in revenues related to owned software during 2013

professionals use technology supplied by Civica

1 million 8% 10 millionpayment transactions processed via the cloud annually


A strong track record

Our customers use Civicas specialist business applications for providing essential services. Every day, they help 1 million professionals around the world to deliver agile services, reduced costs and better outcomes.

Durham County Council

Following the amalgamation of seven councils into a new unitary authority, Civica worked with Durham County Council to unify discrete operations and establish a common consolidated system for the new authority to standardise revenues, benets and income management operations across the county, and with a similar programme for environmental services.

Durham is the fth largest authority in the UK, and the consolidated platform has delivered a range of benets including improved council tax collection and better income management.

Building on the companys business process and technology expertise, Civica has also delivered OnDemand backlog processing services to Durham to support ongoing service delivery.

Belfast Health & Social Care Trust

Civica is working with Belfast Health and Social Care Trust, one of the UKs largest Trusts, to enhance the provision of community health and social care built upon the foundation of a patient record and case management system designed to improve services and efciency through integrated working.

The Belfast Trust delivers health and social care services to 340,000 people across the city as well as specialist services to all of Northern Ireland. The Paris EPR system was selected to support over 5,000 clinical staff at over 120 locations to support the joined-up delivery of safe, timely and quality care.

The system underpins the Trusts focus on patient-centred services delivered from central locations or in the community, including enhanced information sharing to improve decision making, risk management and cost savings.

Sacred Heart College

Sacred Heart College uses Civicas education suite to manage all aspects of student records, from pre-enrolment to alumni tracking, with integrated nance, billing and fund raising underpinned by one-time data entry.

The system is helping the college to transform its management system, integrating disparate processes into an efcient college-wide approach and extending information and access for teachers, staff and parents both within and outside of the school.

Giving teachers more exible any time, any place access to student records, resources and reports has streamlined work ows and allowed staff to focus on key duties to improve teaching and learning.

IT is an integral part of every element of our service delivery and with support from Civica we are achieving operational excellence which means customers can rely on our services.

Alan Harrison // IT Director, Yorkshire Water

34 www.civica.co.uk

At the core of Civica is an in-depth knowledge of our customers business processes, informed by more than 25 years of experience. Drawing on this we provide a broad range of market-leading and increasingly cloud-based systems, which help to streamline and automate service delivery from agile customer services to efcient back ofce operations.

Multi-Channel Contact Management

Revenues & Benefits Housing Health & Social Care Education Libraries Environment & Planning Blue Light Services Fleet

Finance Procurement HR & Payroll Legal Pensions

Business Functions

Corporate Functions

MapsWorkflow RecordsPayments Documents


Review of operations Digital transformation Cloud solutions

Civica provides a broad portfolio of software applications for all aspects of our customers business from front line service delivery and customer management to back ofce administration. Increasingly delivered as a cloud-based service, these provide the technology foundation to streamline and automate core business processes.

With resilient demand for applications which underpin essential services, Civica continued to grow the use of its software including new sales for more than 120 customer organisations. Revenues related to owned software increased by 8 per cent during the year.

Civica maintained investment in software while adding new technology and skills through acquisitions including Corero Business Systems, InfoMaster and, following the end of the year, Coldharbour Systems. As well as developing systems to implement signicant new legislation on time and respond to evolving customer needs, the company announced innovative new products including web-based technology for local government, social housing and library sectors, mobile working solutions in health care and the eStore payment portal.

The potential for IT-based ways of working to transform customer services and deliver cost savings is driving increased focus on the use of digital technologies and channels to create more immediate, agile and connected ways of working.

Civica made good progress during the year with new developments focused around citizen engagement, agile working and automation to help organisations move to a digital model and a new generation of efcient multi-channel services. This included the next stage of Eastbournes multi-award winning programme to re-structure the organisation, re-design services and create a digital working environment.

Electronic access to records and documents also underpins transformation in the health sector and the Group grew the number of customers for its document management systems, such as a Trust-wide deployment for County Durham & Darlington NHS Foundation Trust to implement the next stage of its paperless NHS strategy.

The advantages of private cloud solutions, where mission-critical software applications are delivered remotely as a service, continued to generate interest across the business. This has become the predominant model in many areas, such as the library sector where cloud-based solutions are used by over 80 per cent of the global customer base. New cloud platforms were delivered for local government and education sectors in Australia and New Zealand.

An increasing number of organisations have adopted cloud-based payment systems, moving to a hosted environment in order to reduce cost and risk and ensure compliance with payment card standards. More than 120 UK local authorities have now converted.

Through the G-Cloud framework a number of products and services were made available on the UKs CloudStore, and Civica also secured a place on the Digital Services Framework.

Software and infrastructure services

Civica maintained momentum with a broad range of software licensing, software asset management and professional IT services to help customers in all areas achieve cost savings and ensure effective IT asset management.

Civica is transforming the way that local organisations handle payments by delivering cloud-based payment systems to manage transactions securely for more than 120 local authorities. Processing more than 10 million transactions annually, Civicas cloud solutions ensure efcient management of payments from all sources around the clock.

Icon e-payments and income management software supports all payment and income requirements. Comprising an integrated

suite of browser-based capabilities, the system provides an efcient multi-channel solution supported by Payment Card Industry (PCI) Level 1 data security accreditation for assurance of online, call centre and automated payments.

eStore, a public-facing web portal, provides a shopping basket approach which allows organisations to set up an online store of services and goods that can be purchased and paid by debit or credit card or PayPal account.

Cloud payment systems

36 www.civica.co.uk

Civica provides a broad range of cloud and managed services together with platform-based outsourcing in order to help customers transform services for the better. Building on the companys reputation for service and domain expertise the Group continued to extend the scope and scale of activity during the year with good momentum.

Cloud services & outsourcing

customers rely on managed services provided by Civica

400savings targeted by innovative local government partnerships

20 million 600,000 transactions processed annually through Healthstream service for NIB


We needed a managed services partner to ensure the nationwide resilience and availability of our infrastructure and make certain that we complied with DWP requirements within the time frame.

John Quick // CIO, Avanta

A strong track record

Through experienced people who understand service delivery we apply managed services and IT-enhanced outsourcing to help customers do more, do better and spend less.

South Worcestershire Partnership Avanta Singapore Ministry of Education

Civica is responsible for delivering outsourced revenues and benets services for the South Worcestershire Shared Service in order to sustain local employment, improve services and deliver savings of 3 million to Malvern Hills District Council, Worcester City Council and Wychavon District Council.

Complementing the skills and experience of the shared service team with its own expertise in IT-enabled process improvement, Civica is helping to introduce new processes and innovations while driving down costs.

The partnership has also established the Orchard Centre, a centre of excellence from which it offers a range of processing and collection services to support other councils as they seek to overcome service and budgetary pressures.

One of the UKs leading employment-focused training companies, Avanta selected Civica for an IT outsourcing agreement to support the growth of its services while driving down support costs.

Civica provides managed infrastructure and technical support for up to 80 Job Centre Plus and other ofces across the country, supporting Avantas operations and enabling the organisation to transform its ICT capabilities.

Civicas exible solution ensured Avanta was able to migrate rapidly to a private cloud-based solution delivered as a broad SLA-based agreement with access to processing, storage and applications as a service underpinned by IL3 level security and ISO 27001 accreditation.

Civica provides a national media resource library service for over 360 schools and colleges in Singapore. The service includes cloud-based library systems, centralised collection and distribution services and provision of library stafng, for which Civica placed staff at more than 250 schools.

Students and educators have benetted from integration of systems, stafng, collections and programmes. Standards have been raised with more consistent levels across all schools.

In addition to library technology, collections and stafng, Civica provides additional programmes consisting of activities, workshops and events to ensure effective use of media resource libraries for time constrained teachers.

38 www.civica.co.uk

With experience of successful partnerships across the markets we serve, Civica combines business process and operational expertise with technology know-how to deliver resilient lower cost services. Customers can tap into innovative services that blend the skills and resources of public and private to adapt to a new environment.

Business Process Outsourcing

Infrast

ructu

re Se

rvic

es

Softw

are

&

Info

rmat

ion T

echn

ology

Out

so

urcin

g

Civica Services

Services

Cloud &

Managed



Combining deep understanding of customer business processes with a exible commercial approach, the provision of outsourced and managed services is fundamental to Civicas strategy in order to help customers achieve immediate savings and transfer of risk while driving efciency, innovation and growth.

Activities include platform-based delivery of local back ofce services and outsourcing of discrete activities including collections, assessments and administration, together with exible and efcient OnDemand services.

Outsourcing

During the year the Group maintained excellent momentum with increasing demand from organisations looking to trusted partners in order to sustain and improve service delivery and quality. Outsourcing revenues increased by 73 per cent over the previous year.

Civica extended its market position with new partnerships aided by software and automation. In addition to the ground-breaking South Worcestershire Shared Service, which saw 111 employees transfer to Civica in order to deliver

revenues & benets services while saving 3 million for the three councils involved, new contracts included Forest of Dean District Council, Lambeth Schools and the Universities Superannuation Scheme in the UK, together with extensions for the Singapore Ministry of Education and Nanyang Polytechnic Library.

Existing partnerships performed well including at Gloucester City Council, where the service achieved the best ever council tax collection while delivering substantial savings. At Forest of Dean, the partnership met all performance targets while delivering welfare reform changes, contributing to the authority winning Most Improved Council of the Year at the LGC awards.

Civica delivered an expanding range of services for Luton Borough Council supported by development of ICT strategy for the next 5 years to ensure the service continues to respond to a changing local government environment.

OnDemand

Building on its service centre foundation, Civica continued to grow the use of its OnDemand portfolio of exible pay-as-you-go processing services.

More than 65 projects were delivered to 20 local authorities, providing capacity and expertise to manage peak workloads or short-term resource gaps in order to maintain performance. New contracts included delivery of Local Welfare Assistance on behalf of the London Borough of Barnet, Hampshire County Council and Durham Council.

Cloud and managed services

Demand for managed and cloud-based services continued as organisations look to improve ways to access applications and infrastructure and to reduce the cost and risk of technology ownership. The Group delivered a good performance in this area including new provision for more than 100 organisations.

The ability to deliver applications and infrastructure remotely is underpinned by the Groups highly resilient data centre network operating to ISO 27001. Operations were supported by a sustained focus on service improvement with further investment in employee development, data centre infrastructure and new accreditations.

Civica provides outsourced revenues, benets, welfare rights and counter-fraud services for Gloucester City Council as part of a wider process to transform the councils approach to back ofce and corporate services while delivering annual savings of 220,000.

Through the partnership Gloucester benets from resilient services and improved performance with lower operating costs as well as an increased ability to innovate and pilot new ways of working. During

2013 the partnership delivered the best ever council tax collection for the council.

Creation of the Severn Centre in Gloucester has also provided a foundation for outsourced and OnDemand services to other authorities. Civica provides services to Forest of Dean Council in conjunction with Gloucester, and has delivered OnDemand expertise and resources to 20 councils from London to East Ayrshire, including new contracts to deliver Local Welfare Assistance.

Gloucester City Council

40 www.civica.co.uk

Focus on People


Combining exceptional customer

focus, experience and commitment,

it is the people of Civica and our

culture that sets us apart.

42 www.civica.co.uk

Informed by a clear vision our core values of knowledge, integrity and action are built into everything we do.

Our people & our values

Integrity

Civica is committed to integrity and consistently high professional standards. We are straightforward, open and fair in all we do, to ensure we remain trusted to make and deliver promises and to respond to the needs of our customers, partners and colleagues.

Knowledge

We are committed to developing and applying our knowledge and expertise in order to translate business needs into positive outcomes. Through experience and understanding we focus on anticipating requirements and adapting to change in order to help organisations improve their performance. We aim to be sought after by customers and colleagues for our insight and informed capability.

Action

Focused on our customers and combining experience with initiative, we are committed to delivering meaningful results in a timely manner. We aim to nd new and better ways of doing things supported by effective change management, and to do whatever it takes to help our customers, colleagues and partners achieve their objectives.


Corporate responsibility

Focused around employees, customers and communities, corporate responsibility is integral to our business activity. During the year we continued to increase internal awareness and involvement in specic activities and to progress existing and new programmes in order to contribute to an improved environment both internally and externally. Under the auspices of the Civica Foundation an increasing number of people initiated and took part in charitable activities, from the Tour de Civica bike ride to emergency appeals following the Philippines typhoon and the bushre crisis in New South Wales.

Employees

Civica seeks to recruit, retain and develop people with the vision, ability and approach to succeed for our customers and to support and equip them through our employee programmes to create a knowledgeable, fully engaged and well regarded workforce. Employment policies and procedures actively support our culture and values.

We aim to develop Civica constantly as a positive and enjoyable place to work and to invest in initiatives that ensure we remain an employer of choice. This is demonstrated by a high level of retention well above the industry average. During 2013 the Group gained the Investors in People (IIP) Gold accreditation, which is held by less than 4 per cent of IIP organisations. The award endorses employee practices and recognises our focus on providing excellent service and taking the business forward through the development, support and engagement of our people.

Civica continued to invest in a programme of effective internal communications across the Group to build engagement and support and ensure employees understand our company strategy and activities. Activities range from weekly updates and immediate social channels to regular briengs and cross-company forums. A high level of sharing and feedback is encouraged through regular Listening Boards, suggestion schemes and employee surveys. Use of modern technology has also improved business communications and reduced travel through instant messaging, video communication and desktop sharing.

Our annual Employee Awards programme recognises and rewards the contribution of individuals and teams in making an outstanding contribution to our progress and in demonstrating Civica values in action. A record 313 nominations were made in 2013.

Resourcing

Sustained new intake during the year contributed to a rise in employee numbers of almost 400 in the last two years. With further strong progress in outsourcing and a history of effective acquisitions, our successful approach resulted in smooth transitions with extremely positive feedback from those teams and individuals involved. This again underpinned a strong performance on new contracts including the South Worcestershire Partnership following TUPE transfer of 111 employees.

The business continued to encourage inter-company transfers and promotion to share knowledge and good practice in support of growth and to retain key skills. Civica also extended its programme to support stronger emphasis on recruitment of graduates and modern apprentices.

Civica Academy

Civicas learning academy provides a wide range of training, development and talent management to support our people through their careers and to deliver a competitive edge in meeting customer needs. We operate formal training together with mentor-based and networking programmes to ensure deep understanding of the markets and customers we serve with particular focus around creating customer service excellence and innovation.

Our highly successful Raising the Bar management programme provides leadership skills to support Civicas growth, motivate our teams and drive continuous improvement. The programme includes cross-functional projects to address specic business issues.

Key programmes also include First Impressions for new starters, Customer First to ensure a consistent approach to service and support excellence, and Top Gear, which supports business development teams in bringing IT-based solutions to our customers. More than 300 people have attended continuous improvement workshops this year, which has led to demonstrable improvements across the business.

> continued

The willingness to do well for customers, colleagues and communities is characteristic of Civicas culture. Acting responsibly is embedded in our approach to business.

44 www.civica.co.uk

Benets

The Group provides a competitive benets package for employees augmented by a range of elements including an employee discount scheme, externally managed condential assistance helpline and a programme to support individual health and wellbeing. All employees can also purchase extra holiday entitlement.

Civica is committed to sound and fair business practices including zero tolerance on anti-corruption. Prevention, deterrence and detection of fraud or bribery is the responsibility of all and the company encourages employees to report any suspicion in condence.

Operational excellence

Civica is committed to maintaining high standards and the Civica Management System encompasses our approach to environment, quality and health and safety. During the year the business achieved ISO 9001 and OHSAS 18001 standards for quality management and health & safety respectively for each of our UK sites, adding to existing accreditations including ISO 27001 (information security) and ISO 14001 (environmental) standards.

The Group also launched a global operational excellence programme to ensure consistent best practice in support of the continued growth and ambition of the company. Focused on three main areas systems and processes, business

development and resources and underpinned by a central project ofce, the initiative also provides an opportunity for employee growth, development and recognition.

Civica Foundation

Run by volunteers from across the business, the Civica Foundation provides a focal point for our charitable and community support. Initiatives are targeted at making a positive difference through using our skills, presence and enthusiasm through individual and group projects that reect Civicas expertise, supported and funded via individual and company initiatives.

The Foundation is integrated into company activities including a management challenge within the Raising the Bar programme which produces cross-company projects. The company also operates Donate a Day whereby Civica employees are able to take a day out from work to support local charities or communities, and Pennies from Heaven, through which staff can donate the pence from their monthly salary to charity.

While Civica works with customers to help deliver effective and efcient services that transform services for the better, going beyond this to share our expertise in support of communities is an important aspect of our corporate responsibility. The Group remains active with community schemes with employees and teams from across the company devising and

taking part in a wide range of charitable initiatives. Main charities supported in the UK include the Princes Trust, Action for Children, Water for Kids and Shelter.

Environment

Civica recognises that operating our business has an impact on the environment and that it is important to conduct activities in a sensitive manner. The Group is committed to a process of continuous review and improvement and to work with customers, suppliers, partners and employees in order to recognise and reduce the impact operations have upon the environment.

As well as improving the way we deliver services through the use of efcient technology Civica works with customers to develop innovative technology-based services that help reduce property and power requirements and corresponding environmental impact. In particular digital engagement and electronic document management, exible working and cloud-based services employing leading energy efciency technology can all have a signicant impact on lowering power consumption and carbon emissions, as well as delivering major cost savings in the requirements for ofce space, printing and consumables through paperless working and managed or outsourced service.

Our audit revealed the organisations excellent and on-going commitment to not only implementing and continually improving the management system, but to making it a part of day-to-day operations.


Civica Foundation highlights

In June 2013 a team of Civica employees undertook a cycle ride with a difference. Over the course of 5 days the team, which included a mix of seasoned and not so experienced cyclists, covered almost 500 miles in a bid to visit each of our UK ofces and raise money for Action for Children and Shelter along the way.

Starting in the south east and visiting London, Bristol, Birmingham, Manchester and Leeds, the Tour de Civica raised more than 10,000. The team was supported by many more colleagues around the ofces, driving support vehicles, baking snacks and treats, donating their weekly fruit delivery, handling logistics and keeping everyone informed.

Tour de Civica

Civica team supports creation of Liverpool allotment. Ongoing fundraising efforts support the provision of clean water in Africa.

Civica supports writing talents of young Singaporeans with landmark annual competition.

Since launching Donate-a-Day, a signicant number of employees have used the scheme to support a registered charity of their choice. Activities have included training to become a voluntary Progression Mentor for the Princes Trust, organising the summer garden party fundraiser for St Giles Hospice in Licheld, and developing activity materials for 6-18 year olds for the Scouts Japan Jamboree Contingent Service Team, which supports 3,500 young people from the UK attending the 4-yearly cultural Jamboree in the tented city at Kirara-hama.

The Group supports charity Water for Kids through a number of individual and company initiatives, including a donation for every employee who has completed the Sunday Times Best Companies survey over the last 6 years. This year members of our Public Protection user group took the opportunity to raise funds during their conference and, matched by the Civica Foundation, the money went to support projects in Zambia, Uganda, Kenya and Sierra Leone to avoid the need for women and children to travel long distances for clean water.

Alongside its ground-breaking library contracts in Singapore with the Ministry of Education and the National Library Board, Civica holds an annual creative writing competition to showcase the writing talent of young Singaporeans. The latest competition had over 350 entries with winning stories highlighted at a showcase event and featured in the third book in our Tales of S series, which is included in school library catalogues. The Group also held a competition for students to re-design their library including presenting marketing and project plans, and with the winners securing S$30,000 for their school.

46 www.civica.co.uk

Focus on Finance


Civica extended its unbroken track record

of protable growth during 2013 with a

strong performance particularly in UK local

government and managed services and with

increased scale and capability in health and

education sectors. Group revenues increased

6 per cent to 213 million and visibility

of earnings also improved with good

order book growth and recurring revenues

increased by 7 per cent to 98 million.

48 www.civica.co.uk

Financial review 2013

Phill RowlandChief Financial Officer

During 2013 Civica delivered a very positive result both nancially and operationally. Our ability to achieve controlled growth ahead of the market demonstrates the resilience of our business model and the value we deliver to customers as a strong and stable partner.


With the acquisition of the Civica Group in May 2013, comparative pro forma information has been shown for the Group for the full year to 30 September 2013. Consolidated nancial statements for the Group are available at Companies House.

Group turnover up 6% to

213.2 million

Improved quality of earnings with recurring revenues up 7% to

98.3 million

Closing order book increased to over

730 million

Gross prot margin improved to

73%

Excellent cash generation amounting to

98% of EBIT

EBITDA increased to

42.4 million

Business growth driving increase in employees by 8% to

2,082

Investment in outsourcing with BPS revenues increased by

65%

Acquisition of Corero Business Systems

to expand capability

2013 highlights

Group overview

Pro forma Year ended 30 Sep 13

millions

Year ended 30 Sep 12

millions

Year ended 30 Sep 11

millions

Turnover

Cost of sales

Gross prot

Administration expenses

EBITDA

Cashow from operating activities

Staff

213.2

(57.1)

156.1

(113.7)

42.4

38.1

2,082 1,919 1,635

201.9

(59.5)

142.4

(104.4)

38.0

33.8

182.7

(58.8)

123.9

(89.1)

34.8

34.2

50 www.civica.co.uk

Operating results

In the year to 30 September 2013 the Group continued its long track record of sustained growth as customers continued to invest in Civicas software and services to deliver business critical processes. Driven by strong organic growth in the UK the Group increased revenues by 6 per cent to 213.2 million (2012: 201.9 million), delivering an excellent 8 per cent compound annual growth rate from 2010 to 2013. UK revenues increased to 151.3 million (2012: 140.4 million).

During the period gross prot increased to 156.1 million with gross margins improved to 73 per cent of revenue as we continued to focus on the efcient delivery of software, cloud and business process outsourcing across our customer base. Earnings before interest, taxation, depreciation and amortisation (EBITDA) increased by 12 per cent to 42.4 million (2012: 38.0 million), representing a 19.9 per cent margin on sales.

Due to customer demand for our software and services, the group experienced strong organic growth in IPR and further penetration of cloud-based solutions, driving an increase in revenues associated with owned software by 8 per cent to 185.7 million (2012: 172.1 million). This was supported by strong cash generation from operating activities amounting to 98 per cent of EBIT. The Group nished the year with cash in the bank of 32.9 million (2012: 27.1 million).

Our pipeline of opportunities to support business growth has continued to expand across our all areas of our business. In particular, further migration of our customers to cloud-based solutions and demand for business process outsourcing solutions has continued to support business growth, as customer requirements to balance service delivery amidst tightening budgetary constraints continues.

The combination of growth signicantly ahead of market growth rates together with improved visibility of earnings through long-term recurring revenues which increased by more than 7 per cent in the year to 98.3 million strengthened the groups nancial and market position.

With a growing order book in excess of 730 million at the end of the period, the Group has a strong foundation from which to continue to grow into 2014 and beyond.

Acquisitions

During the year Civica completed the acquisition of Corero Business Systems in the UK, broadening our specialist capability and market presence in education with the addition of Coreros portfolio of nancial, student and business management software which is used by 900 schools and colleges. Immediately following the end of the nancial year we also acquired the local government software business of InfoMaster Pty Limited in Australia.

We continue to focus on identifying complementary acquisitions which will enhance the groups capabilities across our key end markets, so we can continue to provide an increasing range of software and services to our customers.

Due to the continued growth of the group both organically and through acquisition, we are constantly reviewing the processes necessary to underpin efcient delivery to customers as well as our back ofce processes. This is key to ensure that we are able to support the growth of the group in a scaleable and controlled way, identify best practice and manage risk appropriately.

Segmental analysis

The Group continued to maintain a balanced portfolio of activity across markets and geographies, with Local Government the largest business segment producing 52 per cent of total gross margin. The majority of activity continues to be derived from the UK public sector, while approximately 35 per cent of gross prot is derived from the Groups international operations in Australia, New Zealand, Singapore and North America, through a mixture of owned software applications and support through to full business process outsourcing contracts.

Company Country Date Sector Comments

Corero Business Systems UK August 2013 Education Extended presence in the sector, subsequently launched integrated education division with broad product and service offering for schools and colleges.

Acquisitions during the period


65% UK

35% International

52% Local government

22% Education

10% Housing & asset management

9% Health & social care

7% Other

Corporate governance and risk management

The Group continues to operate a strong framework of corporate governance across the business to ensure the successful delivery of business outcomes in line with our strategy and priorities, management of risk and focus on delivery of excellent service to our customers. This framework is managed through the following components.

Group Board

The Group Board is responsible for the overall strategy of the Group and the effective management of risk and performance. It meets on a monthly basis to review business performance in line with Group strategy and to ensure that risks are appropriately managed, including major bids and acquisitions. The performance review is closely aligned to the key priorities set out on page 7 in respect of nancial performance, products and services, customer service, people and the environment, and operational efciency. Business planning is conducted on an annual basis, again in line with the strategy and key priorities, and is signed off by the Board. The Board has an equal balance of executive and non-executive directors.

Executive Management Board

The Executive Management Board consists of the executive Group Board members, the divisional managing directors and Group business development, HR, technology, product strategy and marketing directors. It meets on a monthly basis to discuss strategic business issues and the effective management of risk and opportunity across the business.

Monthly business reviews

Each unit within the Group is subject to a monthly business review by the executive Group Board members to assess the nancial and operational performance and business risks, review the nancial projections and review working capital management and cashow performance. The nancial and operational key performance indicators in each business are closely aligned to the ve key priorities of the Group as highlighted above. Specic business risks are identied and mitigated through this process.

Commercial and legal controls

All acquisition, capital investment and business development activity is controlled through a methodical process of qualication, review an

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