future plc · focus on cash generation. the group continues to develop its brands, creating truly...

AR16Future plcAnnual Report and Accounts2016

Strategic Report

01 Group overview02 Chairman’sstatement03 ChiefExecutive’sreview 05 Strategicoverview07 Whatwedo09 Risksanduncertainties11 Corporateresponsibility

Financial Review 13 Financialreview

Corporate Governance

17 BoardofDirectors19 Directors’report23 CorporateGovernancereport29 Directors’remunerationreport41 Independentauditors’report

Financial Statements

43 Financialstatements 79 NoticeofAnnualGeneralMeeting84 Investorinformation

Continuing EBITE

£2.3m 2015: £0.8m

Continuing Revenue

£59.0m 2015: £59.8m

Continuing EBITDAE

£4.7m 2015: £3.6m

Continuing Digital Advertising

78% of total continuing advertising revenues (2015: 77%)

•EBITDAErepresentsearningsbeforeinterest,tax,depreciation,amortisation,impairmentandexceptionalitems.•EBITErepresentsearningsbeforeinterest,tax,impairmentandexceptionalitems.

Net Cash

£0.5m 2015: Net Debt £(1.8)m

Unique Users

45.2m a month (Q4 up 14% on Q3)

Continuing Exceptional items

£(16.5)m 2015: £(2.5)m

Continuing Loss Before Tax

£(14.9)m 2015: £(2.3)m

Continuing Recurring Revenues

£15.0m 2015: £12.9m

•Recurringrevenuesencompasse-commerceandsubscriptions.•Exceptionalitemsfor2016aboveincludesimpairmentofintangibleassetsof£13.0m.

Future plc is an international media group listed on the London Stock Exchange (symbol: FUTR). These highlights refer to the Group’s annual results for the year ended 30 September 2016.

Group overview01 Future plc

02AnnualReportandAccounts2016

Chairman’s statement

ThisyeartheGrouphasgainedsignificantmomentum;bymovingtoanewdivisionalstructure,Futureisbenefitingfromgreateroperationalefficiency.Thehigh-growthMediadivisionisdevelopingnewrevenuestreamsine-commerceandevents,backedupbysignificantdigitaladvertisingrevenueandtheMagazinedivisionhasincreasedoperationalefficiencythroughastrengthenedmagazineportfolio.

A diversified content business with data at its heart

ThishasbeenanextremelygoodyearforFuture;operatingprofitbeforeexceptionalitemshasgrownby188%year-on-yearledbyincreasingrevenuesintheMediadivision,includingmaterialandfast-growinge-commerceandeventsrevenuestreams.Futurecontinuestoproduceinnovativecontentthroughexpertinsightintowhatitscustomersneedandmonetisesthisthroughadiversifiedbusinessmodelincludingdigitaladvertising,eventsandmagazines.

Afteranumberofchallengingyears,theteamisnowbuildingatrackrecordofdeliveryandtheclearstrategytodeliveracontentplatformbusiness,wherewebringaudiencesandbusinessestogetherthroughtheuseofcontent,isworking.

Wehavealsocompletedanumberofacquisitions,whichhavestrengthenedtheportfolioandwillresultineconomiesofscaleandenhancedoperationalprofitability.Thelastofthese,Imagine,inOctober2016,willhaveamaterialimpactonrevenueandprofits.TheintegrationofImagineiswellontrack.

TheGroupiscommittedtobeingbrilliantatthebasics,includingproprietary,scalabletechnology,whichhasresultedinaleanerandsimplerbusinessandincreasedoperationalefficiency.InadditiontheGrouphasadoptedadisciplinedapproachtoinvestmentandafocusoncashgeneration.

TheGroupcontinuestodevelopitsbrands,creatingtrulyglobal,market-leadingfranchisesofitsdigitalandeventsassetsandproducingarecord-breakingyearforuserreach,withdigitalusersreaching53million.InNovember2015theGroupwasreorganisedintotwonewdivisions,MediaandMagazine,topositionitforgrowth.Thisnewdivisionalstructurehasresultedinamoreefficientoperatingmodelwhichbetterreflectsthedivisions’differentmarketdynamics.Additionallyduringthelatterpartoftheyear,anewMediaServicesdivisionhasbeenestablishedwhichcapitalisesonopportunitiestoexploittheGroup’scapabilitiesasacontentplatform,focusingongrowingrevenuesinthirdpartyrelationships,particularlylicensing,franchisingandsyndicationofitsbrands,contentandtechnology.

OnbehalfoftheBoard,Iwouldliketothankallouremployeesfortheirhardworkandcommitmentthisyear.

Peter Allen Chairman

“ Futurecontinuestoproduceinnovativecontentthroughexpertinsightintowhatitscustomersneed.”


Strategic Report

Strategic reportChief Executive’s review

03 Future plc

Future’sstrategytocreatealeadingglobalspecialistmediaplatformwithdataatitsheart,monetisedthroughdiversifiedrevenuestreams,hasdeliveredextremelypositiveresultswithMediadivisionrevenuegrowthof14%year-on-year.TheGroupisalsobenefitingfromitsoperationalleverageandtheacquisitionsFuturehasmadethisyearhavefurtherstrengthenedtheportfolio.

Data-led content strategy

TheGroupmadesignificantprogressinthelastfinancialyear,bothoperationallyandfinancially.

Futureisaglobalcontentplatformforspecialistmediawithscalable,diversifiedbrandsthathasdataatitsheart.DatadrivesFuture’sstrategybyhelpingtheGroupunderstanditsaudience’sneedsandparticularlythepathtopurchase,whichallowsittoprovidevalueforitspartners,clientsanditself.Thiscreatesloyalcommunities.ThishasbeenmostevidentintheGroup’sfast-growinge-commercebusiness,whererevenueisup187%year-on-year.

Ourdata-ledcontentstrategyunderpinsourmovetoadiverserevenuebusiness,withe-commerceandeventsshowingnotableratesofgrowth.Additionally,amajorre-alignmentofthecostbaseandtightmanagementofthedeclineoftheprintbusinesshaveresultedinfurthergrowthinoperatingprofit.Duringtheyearwecompletedthere-organisationofthebusinessintotwodistinctdivisions;Media,whichisfocusedonglobalscalablebrands,andMagazine,whichisfocusedonmarket-leadingspecialistcontent.

InOctober2016,weestablishedanewdivision,MediaServices,whichisfocusedondeliveringhighmarginrevenuesthroughmonetisingourIPfranchise,licensingandcontractpublishingdeals.

Weareexpandingourglobalreachthroughorganicgrowth,acquisitionsandstrategicpartnerships.TheglobalmediabrandsinourMediadivisionhaveperformedstronglythisyear;twoofourleadingbrands,techradar.comandPCGamer.com,haveshownsignificantgrowth.Techradarrevenuewasup49%year-on-year,aresultofleveragingcontenttoharnesse-commerce,andPCGamerrevenue

up43%year-on-year,throughstrengthenedrelationshipswithhardwareproviders.

Ouronlineaudiencehasneverbeenstronger,withourglobalwebsitesbreakingourownrecords.Duringourpeakseasonpre-Christmaswereached53monlineusers.

Wehavestrongengagementwithourusersthroughourlargesocialmediafollowing,reaching45mpeopleacrossFacebook,TwitterandYouTubeandgenerating10msessionstoourwebsitesfromsocialmedia.

WecontinuetoinnovateinourMagazinedivision,includingnewmagazinelaunchesandupdatestoexistingtitles.

Diversified revenue

Weunderstandthevalueofdiversifiedrevenueswithinmediaandcontinuetoconcentrateondevelopingmaterial,recurringnewcashgenerativeproductsinordertotakeadvantageofafastchangingmedialandscape.Wehaveclearlydiversifiedrevenuestreamsindigitaladvertising,e-commerce,events,licensing,retail,subscriptions,contractpublishingandthirdpartysales.

Oure-commercebusinessgoesfromstrengthtostrength;enrichingusers’experienceandprovidingpricecomparisonandpurchaseoptions.Wehaveourownproprietarypricecomparisontechnology,“Hawk”,whichprovidesuswithapowerfulpositionintheUKonlinetechnologymarketcomparedtomanyotherlargeconsumertechnologywebsites.OuracquisitionofNextCommerceinAugust2016furtherbuildsontherangeofourproductcategories,introducingasignificantlyimprovedtaxonomy,whilealsoexpandingourreachintoAustraliaandSouthEastAsia.

Wehaveastrongdigitaladvertisingrevenuestream,advertisingtargetedatindividualsbasedonbehaviouralsegmentationandatechnologystackthatcapitalisesonthegrowthinprogrammaticwhilemaximisingdigitalyield.Weprovideaccesstouniqueaudiences,focusingonstrategicrelationshipsandcreativesolutions.

Oureventsbusinesshastakensignificantstridesforwardintheyear,includingthehostingoffivenewevents.Wehavebuiltonourglobalbrandsbyproducingourcreativeanddesignconference,Generate,infourlocations:NewYork,Sydney,LondonandSanFrancisco.

TheacquisitionsofNobleHouseMediaandassetsfromBlazePublishinghavesignificantlystrengthenedtheeventsportfoliowithshowsincludingTheLondonAcousticShow,TheLondonDrumShowandtheMobileIndustryAwards.

Additionally,ourawardwinningevent,ThePhotographyShow,generatedover£2mofrevenueandattracted30,000visitorsthisyear.

WecontinuetoinnovateintheMagazinedivisionwithanumberoflaunchesduringtheyear,includingintroducingnewbrandsintothekidscategory,whilewecontinuetofocusonstrengtheningtheperformanceofourexistingmagazinesthroughtargetedre-launches.

Divisions

InNovember2015theGroupwasreorganisedintotwonewdivisions,MediaandMagazine,toenableamoreefficientoperatingmodeltobeemployedineachdivision,reflectingtheirdifferentmarketdynamics.

TheMediadivision,underpinnedbyleadingglobalbrands,isfocusedonbuildingfast-growingdigitalanddiversifiedrevenues.Futurehasinvestedintherapidlygrowingrevenuestreamsofe-commerceandeventsandcontinuestoinnovateindigitaladvertising.

TheMediadivisionfocusesonbeingattheforefrontofdigitalinnovation,inparticularthehigh-growthtechnologyandgamesmarkets.Ithasanumberofleadingbrandsincludingtechradar,PCGamer,GamesRadar+,ThePhotographyShow,GenerateandGoldenJoysticks.

TheMagazinedivisionisspecialistandbrand-led.Ithasover80magazinesandbookazinesandisthenumberonedigitalconsumermagazinepublisherintheUK.Thedivisionisfocusedoncreatingthebestcontentinthemarketinanefficientoperationandcontinuestotightlymanagetheportfolio.Inaddition,wehavemadeanumberofacquisitionsthisyearwithinexistingandnewverticals,whichstrengthenourportfolioandprovidesynergisticbenefits.

InOctober2016,weestablishedanewdivision,MediaServices,inordertobringfocusandresourcesonhighermarginrevenues.TheMediaServicesdivisioniscentredaroundofferingourcontentexpertisetothirdpartycustomers,encompassingourlicensingandcontentpublishingbusinessesandfocusingongrowingourlicensingrevenuesforbothdigitalandprintbrands.Inaddition,thisdivisionisexploringopportunitiesinnon-coremarketstofranchiseourevents.WearealsoreinvigoratingourfocusonFusion,ourcontractpublishingbusiness,withaclearaimofpartneringwithotherbusinessesintheircontentsolutions.

“ Wefocusoncontentthatconnectswithoursubstantialaudiencebaseandmonetisestheirneedsthroughincreasinglydiversifiedrevenuestreams.”

Zillah Byng-Thorne ChiefExecutive


Acquisitions

TheGrouphasstrengtheneditsportfolioovertheyearwithkeybolt-onacquisitions.AddingportfolioenhancingbrandsmeansthatwecanachieveeconomiesofscalethroughourcoreUKpublishingoperationsandenhanceoperationalprofitability.

Theseacquisitionshaveallowedustotakeadvantageofafragmentedmarket.TheyhaveprovidedtheGroupwithanumberofcomplementarytitlestoourexistingportfolioandaddedthenewportfoliooffieldsportsandalsoasteptowardthehighvalueB2Bmarketwiththemobilecategory.

InApril2016,FutureacquiredNobleHouseMedia,amulti-platformpublisherspecialisingintechnologyandthemobileindustry.TheacquisitionaddedexpertiseinthemobileindustryandfurtherstrengthenedFuture’stechnologyportfolio,includingaddingleadingmagazinebrandsMobileChoice,WirelessandMobileandtheprestigiousMobileChoiceAwardsandMobileIndustryAwards.

InMay2016,FutureacquiredassetsfromBlazePublishing,amagazinepublisherandeventorganiser,inthemusicandfieldsportssectors.ThisacquisitionstrengthensFuture’spositionasthemarketleaderinmusicpublishingintheUK,inlinewithourstrategytotakeleadershippositions.

InAugust2016,weacquiredNextCommerce,adigitalshoppingcomparisonbusinesswithoperationsinAustraliaandacrossSouthEastAsia.NextCommerceoperatesGetprice.com.auandPricepanda.comandhaswebsitesinsixcountrieslistingover19.5millionproducts.Inlinewithourstrategythisstrengthensourpresenceine-commercethroughtheirmarket-leadingtechnologyandpracticesforretailers,publishersandconsumersintheregion,whileatthesametimeprovidingafargreatertaxonomythatcanbemigratedintotheFutureHawksoftware.

InJune2016,FutureagreedtermstoacquireImaginePublishing.ThetransactioncompletedinOctober2016.Imaginehasaportfolioof18periodicalmagazinesandpublishesover300bookazinesacrosstheknowledge,history,science,games,techandcreativeverticals.Italsohasastronglicensing,webanddigitaleditionbusiness.

TheImagineacquisitionbringssignificantcostsynergyopportunitiesandcashgeneration,whichcanbedeployedintothecoregrowthareasofthebusiness.TheintegrationofImagineintotheGroupisproceedingtoplanand,whileonlyonemonthin,weareconfidentofdeliveringtheestimatedannualisedcostsynergiesof£3.0m.

Fund raising

TheGroupraisednetproceedsof£3.1minNovember2015viaanequityplacing,toaccelerategrowthandprofitgeneration,particularlyintheMediadivision.Thesefundshaveprovidedworkingcapitalfor,andenabledinvestmentin,theGroup’shighgrowthrevenuestreams,e-commerceandevents,inadditiontoinvestmentintherestructuringofthebusiness.

Current trading and outlook

TheGrouphasaclearstrategy,whichisresultinginimprovedfinancialandoperationalperformance,particularlyincreasedEBITDAEmarginsandcashconversion.

Futurehassubstantiallyincreaseditsportfolioandoverallscale,bothfromorganicgrowthacrossthebusinessandtargetedacquisitions.Thecontinuedfocusonoperationalimprovementsandtheincreasedsizeofthebusinessisresultingineconomiesofscalewithinthebusinessandenhancedoperationalprofitability.

Recurringrevenuestreamsnowrepresent25%oftotalrevenue,comparedto22%inthelastfinancialyear.Theseareamixofsubscriptionrevenuesandhighlypredictablee-commerceincome.

TheBoardexpectsthesetrendstocontinueintothecurrentfinancialyearwhich,atthisearlystage,isperforminginlinewithourexpectations.

Zillah Byng-ThorneChiefExecutive

Strategic Report

Wereach45.4mpeoplethroughsocialmedia

Wereach45.2musersthroughourwebsites

Wesell739,000magazinesandbookazinespermonth

Over38,000peopleattendedourevents

Keydetailsoftheacquisitionswehavemadein2016areincludedbelow:

Acquisition Revenue* Deferred Consideration

NextCommerce £3.3mDeferredconsiderationofupto£550kpayableinFutureplcsharesatendofJanuary2017ifrevenuetargetsexceeded

NobleHouseMedia £0.9m None

AssetsofBlazePublishing £3.1m Upto£320kpayableagainstachievementofgrosscontributiontargets

ImaginePublishing £16.4m None

*RevenuefiguresobtainedfrommostrecentannualfinancialinformationorinthecaseofBlaze,financialinformationrelatingtotheacquiredassets

A global platform for specialist media

Strategic overview

05 Future plc

Future’spurposeissimple;changingpeople’slivesthroughsharingourknowledgeandexpertisewithotherstomakeiteasierandmorefunforthemtodowhattheywant.

Ourcontentispoweredbyourcommunitiesandwebaseeverythingwedoaroundclustersoflike-mindedenthusiastswhoarepassionateabouttheirinterests.Fromvideogamestotechnologyweprovidecontentandexperiencesthatinform,entertainandunitethesecommunities.

Weunderstandwhatisimportantandvaluabletoourpassionateaudiencesandasaresultwearepositionedtodevelopnewprofitablerevenuemodelstofulfiltheirneeds.Wedothisbyinnovatingwithscalabletechnology,uniqueandrelevantcontentandalowcostoperatingmodel.

Ourstrategycentresonleveragingtheconnectionwehavewithouraudiencetomonetisetheconsumer’sneed.

Media

Futureisaplatformbusinesswithadata-ledcontentstrategy.Thecontentcreatesaconnectionwiththeaudience,providingvalueforourclients,fromouraffiliatepartnerstoouradvertisersandalsoforourownbusiness.

Ourstrategymeansthatweunderstandthecustomerpathtopurchase,makingourplatformtheplacewherecontent,codeandcommerceconnect.

Throughourdatainsightsweunderstandwhatouraudiencewantandwheretheywantitwhichenablesustoproducecontentspecialisedandtailoredtothemthroughbuyingguides,reviewsandhow-to’s.

Wehavestrongdigitaladvertisingandcontentsolutionsrevenuescreatedthroughthemeaningfulrelationshipswehavewithourstrategicpartners. TheMediadivision’sstrategyisbasedarounditsglobalandmarket-leadingbrandsandtheconsumerneedthateachfulfils,aswellasadata-ledcontentstrategy.Thedivisionisfocusedonbuildingfast-growingdigitalanddiversifiedrevenues,mostnotablyine-commerceandevents.

DiscoverOureditorialexpertiseandSEOleadershiphelpsurfacecontentthatinformsthepurchasedecisionsofinfluentialconsumers.Ourproficiencyinaidingconsumerdiscoverabilityisakeyfeatureofourbusiness.Techradarisanexcellentexampleofthis;wherewebelieve85%oftheaudiencearriveonthesiteaspartoftheresearchphasefortechnologygoodsand26%goontobuy.

WeareexpertsinSEO;techradarrankednumberoneonGooglesearchforiPhone7whenitlaunched,representingtechradarasaworld-renownedbrandandresultinginthesitehavingitsfourthbiggestdayofalltimewith1.7millionsessions.Millionsofpeoplerelyonusforleadingcontenttrends;PokémonGolaunchedinJuly2016andbytheendofthemonthourPokémonGocontenthadbeenviewed6.2milliontimes.

Ouronlineaudiencehasneverbeenstronger.Attheendof2015anumberofoursitesbroketheirownrecords,whenPCGamer.comreached10millionusers,up37%year-on-year,andtechradarreached22millionusers,up14%year-on-year.InDecember2015,GamesRadar+reached11millionusersand103millionpageviews,thelargesteverwithusersup29%year-on-year.

Wearemarketleaders,holdingthenumberonemarketpositionsintheUKinonlineconsumertechnology,onlinecreative&designandtheglobalnumberonepositioninPCgaming.

EngageWeareexpertsatengagingwithouraudiencebyconnectingthroughcrediblecontentandmeaningfulexperiencesandweempowerouraudiencetoshareandengagewithusandourcommunity.

Futurehassignificantreachonsocialmediawithourgamingbrandshaving12.3millionFacebookfans–farlargerthanourtwobiggestcompetitors,makingusamarket-leadinggamingsocialmediacommunity.

OurcoverageofFallout4inNovember2015wasGamesRadar+’sbiggestsocialmediasuccess,creatingonemillionreferrals–morethandoubleanormalweekday.AdditionallyourYouTubevideoviewsforFallout4reached120,000inasingleday.

Wearecommittedtofulfillingconsumerneedbydeliveringtherightexperience.Wehavedevelopedoureventsbusinessusingtheconnectionwecreatewithouraudiencethroughcontenttoattractthemtoattendourevents.Award-winningThePhotographyShowtookplaceagaininMarch2016,increasingitsnetcontribution17%year-on-year.TheGoldenJoysticksinOctober2015wasthemostsuccessfulyetresultingin9millionvotes,13.5millionpageviewsand770,000users.

PurchaseWearethenewstorefrontdirectlydrivingthepurchaseoftechnologyproducts,gaminghardwareandsoftwarethroughour“Hawk”engine,ouruniqueproprietarypricecomparisondatabase.Hawkhasnowachievedsignificantscalegeneratingover£107millionofgrossrevenueforourcustomersinthelast12months,up199%year-on-year.Weexisttohelpourreadersmakethemostinformedbuyingdecision,servethemthebestdealsontheproductstheydesireandofferguidanceonhowtobesttakeadvantageoftheirgearonceitarrives.

Hawkwasdevelopedin-housetobescalableacrossmultiplebrandsandrobustatahighvolumeoftransactions.Futureservesuptheproductandpricinginformationbasedonanalgorithmthatdeterminesthebestmatchingproductfromitsdatabase.UsingtheGroup’stestedandprovenmethodologyithasimprovedvolumesandconversiontocreateamaterialnewrevenuestream.

FutureiswellplacedtobenefitfromBlackFridayandCyberMondaybytargetingdealsinthetechnologysector.InNovember2015werankednumberoneonGoogleforBlackFridaysearchterms,throughoutthebuild-upandintothedaysthemselves.InNovember201545%oftrafficwentfromtechradarstraighttoashoppingandclassifiedwebsite,comparedto

Strategic Report

26%inMarch2016.Hawkprovidesreal-timepricinginformationonover222millionproductofferingscoveringthemajorityofconsumerproductsinNorthAmericaandWesternEurope.

Magazine

WeareoneofthemostsignificantspecialistmagazineandbookazinepublishersintheUKwithaportfoliocoveringninedifferentsectorsandtitlesavailableinprintanddigitalformats.FutureisamarketleaderforbookazinesintheUK,apositionfurtherstrengthenedbyouracquisitionofImaginePublishing.Additionally,wearethelargestpublisherofdigitalmagazinesintheUK.

TheMagazinedivision’sstrategyistoincreasetheGroup’sefficiencybylaunchingnewpropositionswhilsttightlymanagingthecostbase.Itisalsotakingadvantageofafragmentedmarketthroughacquisitions,whichenablethebusinesstobenefitfromeconomiesofscale.

Thisinnovationcontinueswithanumberofmagazinelaunchesandre-launches,includinglaunchingProfessionalPhotographyinOctober2015toreinforceFuture’smarket-leadingpositioninphotography.

Re-launchesincludedComicHeroesinOctober2015andre-designsofMacFormatinJanuary2016,OfficialXboxinApril2016andTotalFilminJune2016.There-launchofTotalFilmmagazinesawcopysalesincreaseby36%.

Wecontinuetocloselymanagethedeclineinrevenueofthemagazineportfolio.InlinewithtightlymanagingthecostbasetheGroupalsocompletedacomprehensivereviewofitsprocurementprocesses.Asexpected,thishasidentifiedaround£0.6millionofsavings.

Leaner, simpler

Weprideourselvesonbeingbrilliantatthebasicsandkeepingourbusinessleanandsimple,fromproducingmarket-leadingandaward-winningbrandstotightlymanagingourcostbaseandusingsimplebutscalabletechnology.

Wehavedevelopedasingleproprietaryplatformtomanageourwebsitesandhavemigratedallcorebrandsontothisplatform,allowingscalabledevelopmentoftemplatechangesandnewadformats.Wehavealsorolledoutaproprietarybuiltcontentmanagementsystemacrossthedivision,whichisfastandefficientandisdesignedtosupportmulti-mediaeditorialcontentandsupports24hourglobaleditorialcoverage.Thecombinationofthesetwodevelopmentsmeansthatthesignificantamountofcontentpublishedisswiftlyandefficientlymanaged,whiletheoperationasawholecanbeeasilyscaledwithoutanyadditionaloperatingcosts.

Additionally,wehaveupgradedourinternalsystemsinfinanceandadvertisingsales.

Media Services

Ournewdivision,MediaServices,whichweestablishedinOctober2016,strengthensourfocusoncontentpublishing,licensingandothernewopportunitiestofranchiseourdigitalbrandsandeventsinnon-coremarkets.

Weleverageourexpertiseincreatingpremiumandauthoritativecontenttoworkwithleadingbrandstoelevatetheirconversationwithconsumers.Wealreadyhaveanestablishedlicensingrevenuestream,licensingourmagazinecontentto31countries,with68%ofrevenueonannualcontracts,aswellaspublishingtechradarIndiaviaafranchisecontract.

06

The Future Values

We are part of the audience and their communityOurpassionforourproductsmakesuspartofthecommunityweengagewith

We are proud of our past and excited about our futureWeareoneteam,onecompanywithbigambitions

We all row the boatWemovefasterwheneveryonepullsinthesamedirection

Let’s do this!Takethebestdecisionswecaninthefaceofuncertainty–thengoforit!

Results matter, success feels goodWerestlesslylooktoimprove,becreativeandunashamedlycommercialinourventures

It’s the people in the boat that matterHavingtherightteamintheboatismissioncritical

AnnualReportandAccounts2016

Media brands

OurMediadivisionconsistsofanumberofglobalonlinebrandsandeventsnotablyinthetechnology,games,entertainmentandphotographysectors.

OurinfluentialtechnologywebsitesmakeFuturealeadingauthorityonallthingstech.Wecovereverythingfromlifestylegadgetstoauto-tech,bringingouraudiencethelatestdevelopmentsinphones,computing,tablets,wearablesandmore.

Ourflagshiptechnologywebsite,techradar,isthenumberoneconsumertechnologywebsiteintheUK.Ourtechnologybrandsreachover25millionusersaswellas4millionacrossFacebook,TwitterandYouTube.85%oftechradar’saudienceisgeneratedfromtrafficfromsearchengines.Techradargenerated£15millionworthofsalesacrossBlackFridayweekend2015.

Future’siconicgamingbrandsareavoiceofauthorityforgamersworldwide.Wereach15millionusersacrossouronlinegamingbrandsand35millionacrossoursocialmediachannelsmakingusaglobalmarket-leadingsocialcommunityofgamers.Future’srenownedgamingportfolioisthevoiceofauthorityforgamersworldwideandhasinfluencedgamingcultureforover30years.Weholdauniquepositionintheglobalgamesmediamarket,combiningthestrongestgamesindustrypartnershipswithaninnovativemultichannelapproach.GamesRadar+blendsgaming,TVandmovieentertainment,PCGameristhenumberonePCgameswebsiteontheplanetandtheGoldenJoystickAwardsisoneoftheworld’sbiggestconsumer-votedgamingawardsevent.

TheMediadivisionisalsohometotheUK’slargesteventforenthusiastandprofessionalphotographers;theaward-winningandphenomenallysuccessfulThePhotographyShow.

CreativeBloqisthenumberonecreative&designcontentwebsiteintheUKandthe

US,reachingover4millionwebdesigners,developers,graphicdesignersand3Dartistseachmonth.WealsohostthehighlysuccessfulGenerateconferences,theglobaleventforwebdesignersanddevelopers,whichtakeplaceinNewYork,Sydney,LondonandSanFrancisco.

ThisyearsawthesecondPCGamingShowatE3inJune.Theshowwasamassivesuccessresultingin449,000viewsoftheeventonTwitchand2.1millionusersviewingE3contentonourwebsites.E3alsohadapositiveimpactwithincreased(news-focused)traffictoPCGamer,whichbroughtwithitahealthyincreaseincommissionrevenue(28%onPCGamer).

InMarchwelaunchedthePCGamerWeekenderinLondonwhichwassuccessfulintermsofvisitorsandsponsors.

Thisyear’sT3Awardswereaphenomenalsuccesswithattendeewill.i.amdeclaring“threeyearsfromnowtheT3AwardswillbetheGrammysandtheBritsonsteroids”.

Technology and photography brands include:techradarT3GizmodoUKLifehackerUKITProPortalThePhotographyShowMobileChoiceConsumerAwards

Games & entertainment brands include:GamesRadar+PCGamerKotakuUKGoldenJoysticksPCGamingShowatE3PCGamerWeekender

Creative & design brands include:CreativeBloqGenerateconferences

Music brands include:MusicRadarTheLondonAcousticShowTheLondonBassGuitarShowTheLondonDrumShow

Magazine

TheMagazinedivisionpublishesanumberofspecialinterestmagazinesandbookazinesinbothprintanddigitalformatinthegames,entertainment,technology,photography,musicandfieldsportssectors.

Ourgamingprinttitlescovereveryonefromdedicatedindustryprofessionalstopassionateconsolegamers,includingtheofficialPlayStationmagazineandglobalprintPCgamingbrand,PCGamer.

Ourdynamic,market-leadingspecialisttechnologymagazinesprovidein-depthinsightsuchasMacFormatandMaximumPC.TheGroup’sacquisitionofNobleHouseMediasawFutureenterthetechnologyB2Bsector,withtopbrandsincludingconsumermobilemagazine,MobileChoice,aswellastrademagazinesWirelessandMobile.

Future’sfilmmagazinesconnectwithfilmandTVloversworldwide.OurportfolioincludestheiconicmoviemagazineTotalFilm,theequallyrenownedandbest-sellingsciencefictiontitleSFX,andthegenre-specificbrandsCrimeSceneandComicHeroes.Ourcombinationofauthorityandaccessensuresthatouraudiencestaysontopofthelatestmovie,TVandfictionnews.InJune2016TotalFilmre-launchedwithanewtagline“TheSmarterMovieMagazine”andalargersizethatreflectsthepassionatemodernfilmconsumerandgivesgreaterdepthofcoveragetothelatestfilms.AsaresultTotalFilmhasseenaremarkablespikeinsalesfollowingthere-launchwitha36%increaseissue-on-issue.

FutureistheUK’sleadingpublisherofmagazinesaboutphotography.Ourmagazinesofferpracticaladviceandinspirationtophotographersofallskilllevels.

Our divisionsWhat we do

07 Future plc

Futureplcisaninternationalmediabusinessorganisedintotwodivisions,MediaandMagazine.

Themarket-leadingDigitalCameramagazinecoversD-SLRandCSChobbyists,CanonfansturntoPhotoPlus,N-Photois100%Nikon-focused,whileProfessionalPhotographymeetstheneedsoftheworkingprofessional.

Ourmusicportfolioinformsandinspiresmusic-makerstobeevengreateratthethingtheylove;we’vegotitcoveredonguitars,drumsandhi-tech.

Weproducemarket-leadingcreativeanddesignprintmagazinesincludingnet,ImagineFX,3DWorldandComputerArts.

OuracquisitionofassetsfromBlazePublishinghasenteredusintoanewvertical,fieldsports.

ThroughouracquisitionofImaginePublishing,wehavegainedmagazineswithinthehistory,knowledgeandsciencesectors.

Technology and photography brands include:T3MacFormatMaximumPCMobileChoiceDigitalCameraN-PhotoPhotoPlus

Games & entertainment brands include:OfficialPlayStationPCGamerSFXTotalFilm

Creative & design brands include:3DWorldComputerArtsnet

Music brands include:GuitaristRhythmComputerMusicAcousticMagazine

Field sports brands include:AirgunShooterSportingRifleBowInternational

Media Services

OurnewMediaServicesdivision,whichweestablishedinOctober2016,encompassesourcontentpublishingbusinessFutureFusionandourlicensingbusiness.

FutureFusionisourin-housecreativeserviceagency.Wecreatecontentforglobalaudiencesacrossourmedianetworkandbeyond.Ourclientsaresomeoftheworld’sbiggestbrandswithinoursectorsandwealsooperateinnon-coresectorssuchastravelandmotoringprovidingown-brandedcontentforourclients.

Welicenseandsyndicateoureasilytransferablecontentto31overseasmarketsandwecontinuetobethenumberonelicensingpartnerinourspecialistsectorsformediaaroundtheworld,withmarket-leadingcontentdeliverysystemsandefficientbusinessprocesses.

Additionally,thedivisionhasdedicatedresourcetofocusonareasinourbusinessthathavegoodgrowthprospects,whichincludeopportunitiesinnon-coremarketstofranchiseourdigitalbrandsandeventsaswellasdrivinggrowthinlicensingandFutureFusion.

Strategic Report

AnnualReportandAccounts2016 08

Business review

Business review

Key Performance IndicatorsThekeyperformanceindicatorsarepresentedonacontinuingbasis.

2016 2015

Corporate KPIsEBITDAE(£m): 4.7 3.6EBITE(£m): 2.3 0.8Media Division KPIsNumberofusersvisitingourwebsites(monthly) 45.2m 48.5mNumberofeventattendees(thousands) 38.3 32.0Numberofe-commercetransactions(thousands) 1,128 563Magazine Division KPIsNumberofcopiessoldpermonth(thousands) 739 818Subscriberbase(thousands) 399 466Copiessoldasapercentageofcopiesprinted (includingsubscriptions)

45% 50%

09 Future plc

Risks and uncertainties

Likeallbusinesses,ourbusinessfacesrisksanduncertaintiesthatcouldimpacttheGroup’sachievementofitsobjectives.Riskisacceptedasbeingapartofoperatinganybusinessandwehavethereforeestablishedacontinuousprocessofidentifying,evaluatingandmanagingrisk.

Risks and uncertainties

Risk management

Risks Description Mitigation

Operating environment Thestructuralchangeinouroperatingenvironmentandthepaceofthetransitionfromprintremainarealrisk.Thereisariskthatprintcirculationvolumesandprintadvertisingrevenuesdeclineatafasterratethananticipatedanddigitalrevenuesdonotgrowataratetooffsetthedecline.

Futurecontinuestoinnovate,makingavailableitsspecial-interestcontenttoconsumersinprint,wherewehavehadanumberofsuccessfullaunches.Wecreatebest-in-classcontenttocreateanemotionalconnectionwithouraudiencesofengagedenthusiasts,whorepresentanattractiveaudienceforadvertisers.Wehavebecomeanintegralpartofthepurchasecyclewhichcanbemonetisedviaaffiliatesande-commerce.

Debt financing Futurehadabankfacilitytotalling£5.0mat30September2016.Failuretocomplywiththefinancialcovenantsofthefacilitycouldresultinadditionalfinancecostsandthepossiblewithdrawalofthefacility.

Futurecontinuallymonitorsitscashflowsandcovenantsandhasoperatedwithinallitscovenantsthroughouttheyear.FollowingtheacquisitionofImagine,theGroupsecurednewfacilitiestotalling£14.0mwhichexpireinJune2021.

Intellectual property Futureuses,andgrantslicencestoitslicenseesallowingthemtouse,varioustypesofthird-partycontentincludingmusic,audiovisualmaterial,photos,imagesandtext.Asapublisher,Futureisresponsibleforanyintellectualpropertyorotherinfringementrelatingtothesameandaslicensor,Futureisresponsibletoitslicensees.

Futureproducesguidanceandin-housetrainingtoeducateitsstaffontheimportanceofobtainingappropriaterightsorlicencesandhasadedicatedin-houserightsmanagementteam.Future’slegalteamreviewsallsignificantlicencesrelatingtothird-partycontentand,whereappropriate,seekswarrantiesandindemnitiesrelatingtothesame.FuturelicensescontenttothirdpartiesbasedonstandardcontractswhichseektolimitFuture’sliability.

Financial Thelonglagtimeforreportingonsalesofexportedprintedcopiescontinuestobeanareaofforecastinguncertainty.

Forecastingremainsdifficultinallconsumermarkets.Aswecontinuetodiversifyourrevenuestreams,newactivitiesareinherentlymoredifficulttoforecastaccurately.

Advertisingpipelinescanbesubjecttoslippage,withtheriskthatresultingrevenueispushedintolateraccountingperiods.

TheGroupisexposedtointerestrateriskandforeignexchangerisk.

Thesignificantissuesconsideredinrelationtothefinancialstatementsfortheyearended30September2016aresetoutintheAuditCommitteesectionoftheCorporateGovernancereportonpage27.

Onprintedproduct,inparticularbookazines,amoreconservativeinitialviewonsalesestimatescontinueswithemergingtrendsbecomingmoreapparent.

Future’sforecastinginrespectofinnovativeproductswillbecomeeasierasthoseproductsdevelopamoreconsistentcustomerbaseandstablebusinessmodels.

Carefulmonitoringofthepipelineandbookingstoclosethegapintheeventofanyshortfall.

TheDirectorsconsiderFuture’sexposuretointerestrateandforeignexchangerisktobelowandthereforetherearenohedgesinplace(seenote22tothefinancialstatementsformoredetail).

ReviewbyAuditCommitteewithexternalauditor.

IT Thebusinessisincreasinglydependentontechnology.

Intheeventofatotalnetworkorserverfailure,ordataloss,therewouldbeamajorimpactontheproductionofmagazines,operationofwebsitesandtheoperationaleffectivenessofthebusiness.

Future’snetworkhasatleasttwodiverseroutesforallkeyofficesandbusiness-criticaldataisheldonthreehighlyresilientstoragedevicesindifferentlocations.Inaddition,allcoreswitchesareduplicatedindifferentbuildingssotherearenosinglepointsoffailure.ServersaredistributedacrosstwomaindatacentrelocationsandseveralcontrolledserverroomsindifferentbuildingsinBathandSanFrancisco.Futurecanswitchservicesfromoneservertoanotherwithinafewhours.Inaddition,allmission-criticalserviceshavemorethanoneserversothereisnosinglepointoffailure.FurtherinvestmentintheITinfrastructurehasbeenmadein2016andmoreisalreadyunderwayin2017.

Staff TheGroup’sstrongreputationasaleadingcontentprovidermakesitsstaffpotentiallyattractivetocompetitors.ThereisariskthatkeystaffwillmoveelsewhereifofferedsignificantincreasesinremunerationwithwhichFutureisunabletocompete.

Futureemployspeoplewhoarepassionateabouttheirsubject.Futureoffersanumberofstaffbenefitsandincentiveprogrammestoattractandretainkeystaff,andstepsaretakentoensurethattheGroupisnotexcessivelyreliantuponanyoneemployee.

Personal data and cyber fraud

AlossofpersonaldataoracyberattackwouldtriggertheneedtonotifyusersandtheInformationCommissioner’sOffice(ICO)andFuturemaysufferreputationalrisk,aswellasasignificantfinancialpenalty,ifitisresponsibleforthebreach.

Futureseekstoensureallofitssystemscomplywithbestpracticeasregardstosecurityandhasinplaceaplantomitigatetheeffectsofanyhack.TheGroupiscontinuallyinvestingandupgradingitsITsystemsandprocessestoensurethattheyaresufficientlyrobustandappropriateforthedigitalage.

Noattacksweresufferedin2016.


Risk management

Risks Description Mitigation

Operating environment Thestructuralchangeinouroperatingenvironmentandthepaceofthetransitionfromprintremainarealrisk.Thereisariskthatprintcirculationvolumesandprintadvertisingrevenuesdeclineatafasterratethananticipatedanddigitalrevenuesdonotgrowataratetooffsetthedecline.

Futurecontinuestoinnovate,makingavailableitsspecial-interestcontenttoconsumersinprint,wherewehavehadanumberofsuccessfullaunches.Wecreatebest-in-classcontenttocreateanemotionalconnectionwithouraudiencesofengagedenthusiasts,whorepresentanattractiveaudienceforadvertisers.Wehavebecomeanintegralpartofthepurchasecyclewhichcanbemonetisedviaaffiliatesande-commerce.

Debt financing Futurehadabankfacilitytotalling£5.0mat30September2016.Failuretocomplywiththefinancialcovenantsofthefacilitycouldresultinadditionalfinancecostsandthepossiblewithdrawalofthefacility.

Futurecontinuallymonitorsitscashflowsandcovenantsandhasoperatedwithinallitscovenantsthroughouttheyear.FollowingtheacquisitionofImagine,theGroupsecurednewfacilitiestotalling£14.0mwhichexpireinJune2021.

Intellectual property Futureuses,andgrantslicencestoitslicenseesallowingthemtouse,varioustypesofthird-partycontentincludingmusic,audiovisualmaterial,photos,imagesandtext.Asapublisher,Futureisresponsibleforanyintellectualpropertyorotherinfringementrelatingtothesameandaslicensor,Futureisresponsibletoitslicensees.

Futureproducesguidanceandin-housetrainingtoeducateitsstaffontheimportanceofobtainingappropriaterightsorlicencesandhasadedicatedin-houserightsmanagementteam.Future’slegalteamreviewsallsignificantlicencesrelatingtothird-partycontentand,whereappropriate,seekswarrantiesandindemnitiesrelatingtothesame.FuturelicensescontenttothirdpartiesbasedonstandardcontractswhichseektolimitFuture’sliability.

Financial Thelonglagtimeforreportingonsalesofexportedprintedcopiescontinuestobeanareaofforecastinguncertainty.

Forecastingremainsdifficultinallconsumermarkets.Aswecontinuetodiversifyourrevenuestreams,newactivitiesareinherentlymoredifficulttoforecastaccurately.

Advertisingpipelinescanbesubjecttoslippage,withtheriskthatresultingrevenueispushedintolateraccountingperiods.

TheGroupisexposedtointerestrateriskandforeignexchangerisk.

Thesignificantissuesconsideredinrelationtothefinancialstatementsfortheyearended30September2016aresetoutintheAuditCommitteesectionoftheCorporateGovernancereportonpage27.

Onprintedproduct,inparticularbookazines,amoreconservativeinitialviewonsalesestimatescontinueswithemergingtrendsbecomingmoreapparent.

Future’sforecastinginrespectofinnovativeproductswillbecomeeasierasthoseproductsdevelopamoreconsistentcustomerbaseandstablebusinessmodels.

Carefulmonitoringofthepipelineandbookingstoclosethegapintheeventofanyshortfall.

TheDirectorsconsiderFuture’sexposuretointerestrateandforeignexchangerisktobelowandthereforetherearenohedgesinplace(seenote22tothefinancialstatementsformoredetail).

ReviewbyAuditCommitteewithexternalauditor.

IT Thebusinessisincreasinglydependentontechnology.

Intheeventofatotalnetworkorserverfailure,ordataloss,therewouldbeamajorimpactontheproductionofmagazines,operationofwebsitesandtheoperationaleffectivenessofthebusiness.

Future’snetworkhasatleasttwodiverseroutesforallkeyofficesandbusiness-criticaldataisheldonthreehighlyresilientstoragedevicesindifferentlocations.Inaddition,allcoreswitchesareduplicatedindifferentbuildingssotherearenosinglepointsoffailure.ServersaredistributedacrosstwomaindatacentrelocationsandseveralcontrolledserverroomsindifferentbuildingsinBathandSanFrancisco.Futurecanswitchservicesfromoneservertoanotherwithinafewhours.Inaddition,allmission-criticalserviceshavemorethanoneserversothereisnosinglepointoffailure.FurtherinvestmentintheITinfrastructurehasbeenmadein2016andmoreisalreadyunderwayin2017.

Staff TheGroup’sstrongreputationasaleadingcontentprovidermakesitsstaffpotentiallyattractivetocompetitors.ThereisariskthatkeystaffwillmoveelsewhereifofferedsignificantincreasesinremunerationwithwhichFutureisunabletocompete.

Futureemployspeoplewhoarepassionateabouttheirsubject.Futureoffersanumberofstaffbenefitsandincentiveprogrammestoattractandretainkeystaff,andstepsaretakentoensurethattheGroupisnotexcessivelyreliantuponanyoneemployee.

Personal data and cyber fraud

AlossofpersonaldataoracyberattackwouldtriggertheneedtonotifyusersandtheInformationCommissioner’sOffice(ICO)andFuturemaysufferreputationalrisk,aswellasasignificantfinancialpenalty,ifitisresponsibleforthebreach.

Futureseekstoensureallofitssystemscomplywithbestpracticeasregardstosecurityandhasinplaceaplantomitigatetheeffectsofanyhack.TheGroupiscontinuallyinvestingandupgradingitsITsystemsandprocessestoensurethattheyaresufficientlyrobustandappropriateforthedigitalage.

Noattacksweresufferedin2016.

01 Identificationofrisks

02 Evaluationoflevelofrisksandcontrolsinplacetomanagethoserisks

03 Actiontakentomanagerisks

04 Risksreportedandmonitored

01. I

DENTIFy 02. EVALUATE03. ACT

04. REPORT

Future’s assessment

of risks

There are a number of general business risks to which Future is naturally exposed in the UK and US. In addition, the range of industry-specific risks faced by Future continues to increase, due to the increasingly digital focus of the media landscape and the increasing number of evolving business models.

Ourinternalcontrolsseektominimisetheimpactofrisks,asexplainedinourCorporateGovernancereportonpage25,andduringtheyearwehavecontinuedtodevelopthosecontrolsinresponsetothewiderrangeofrisks.

Strategic Report

11 Future plc

Corporate responsibility

CorporateresponsibilityisintegraltothewayFutureconductsitsbusiness.Wefocusoureffortsaroundthreekeyareaswherewethinkwecanmakeadifference.

Responsible business

1. The environment

Aresponsibleapproachtotheenvironmentisessentialtoensurethefuturesustainabilityofourbusiness.

Sourcing paperPaperisthelargestrawmaterialweuseasaGroup.Weworkhardtomakesurethatwhateverweconsume,wedoinawaythatisethicallyresponsibleandenvironmentallysustainable.In2016,100%ofourpaperacrosstheGroupwassourcedfromeitherrecycledfibreorsustainableforestswhereatleastonetreeisplantedforeverytreefelled.IntheUK,FutureholdstheFSC(ForestryStewardshipCouncil)ChainofCustodycertification.ThisrecognisesFuture’scommitmenttosourcingpapersuppliesfromsustainableforests.

In2016,over90%ofthepaperweusedintheUKwasFSCcertified.WeactivelyencourageoursupplierstoworktowardsFSCcertificationoroneoftheotherinternationallyrecognisedandindependentlyauditedcertificationschemesforenvironmentalcareinforestmanagementandconservation.

Recycling and wasteTheGroupisstronglyincentivisedtominimisethenumberofunsoldmagazinesandweemploysophisticatedtechniquestohelpachievethis.IntheUK,Future’sunsoldmagazinesarerecycled.WealsosupportthePPA’sinitiativeencouragingreaderstorecycletheirmagazinesafteruseandweincorporatetheWRAPrecyclelogoinallourmagazines.WecomplywithourobligationsundertheProducerResponsibilityObligations(PackagingWaste)Regulations.Thedisposalofwastematerialsisalsoincludedinourprintsupplieraudit.

Supplier auditsWeundertakeenvironmentalandethicalauditsonourmainsupplierswhichincludeaspectssuchastheprocessinganddisposalofeffluents,emissionsandwastematerials,andtheuseoflabour.

2. Our people

Future’semployeesareourmostimportantassets;theyarethedrivingforcebehindoursuccessasabusiness.

Health and safetyThehealthandsafetyofallemployeesisakeypriorityfortheGroup.Futureislargelyanoffice-basedenvironment.AllcompaniesacrosstheGroupcomplywithrelevantlegislationandwecommunicateourhealthandsafetypolicytoallemployees.IntheUK,duringtheyearto30September2016,therewerenofatalities,noreportable(RIDDOR)injuries,andnominorinjuries.TherewerenofatalitiesorinjuriesintheUSorAustraliaduringthisyear.

Policy on disabilityTheGroupaimstoensurethatwhenconsideringrecruitment,training,careerdevelopment,promotionoranyotheraspectofemployment,noemployeeorjobapplicantisdiscriminatedagainst,eitherdirectlyorindirectly,onthegroundsofdisability.

Ifanemployeebecamedisabledwhileinemploymentandasaresultwasunabletoperformtheirduties,wewouldmakeeveryefforttooffersuitablealternativeemploymentandassistancewithretraining.

Internal communicationFuturehaspoliciesonemployeecommunication,acceptableuseofIT,healthandsafetyandwhistle-blowing,andwehaveacommitmenttodiversityandopportunity.

Weholdregulartownhallsessionsforallemployees,andextendedleadershipteammeetingswherewediscusskeystrategicinitiativesandtheperformanceofthebusiness.IntheUKweheldanallcompanyconferenceinOctober2016.Theseinitiativesensurethatcommunicationisconstantlyimprovingacrossthebusiness,reinforcethebuildingofapositiveworkingenvironmentwherewecelebratesuccessesandalsohelptoensurethereisalignmentacrossthebusiness.Ourenvironmentisonewhereweencourageemployeestofreelygivetheirviewsandcontributetoinitiatives,asthiscontinuouslydevelopsandimprovesourofferingforthebenefitofourconsumersandclients.

3. The community

Giving something back IntheUKtheGrouphasworkedinpartnershipwithBath-basedcharitablefoundationQuartet,whomakedonationstolocalcharitiesonourbehalf.

Future in the wider communityFuturepeoplehavebeenactivelyinvolvedintheyearwithanumberofnationalorganisationsincludingtheProfessionalPublishersAssociation,EuropeanMagazineMediaAssociation,AssociationofOnlinePublishers,NABS,European&LeisureSoftwarePublishersAssociation,theIPA,theMarketingSocietyandtheInternationalFederationofthePeriodicalPress.

Employment data across the Group 2016

Splitoffemale:maleemployeesasat30September2016 32%:68%Splitoffemale:maleDirectorsoftheCompanyasat30September2016 3:2Splitoffemale:malemembersoftheExecutiveCommitteeasat30September2016 1:5Earningsmeetatleastlegalminimumorminimumsetbyindustry yesCasesofreportedandprovendiscriminationorharassment NoneConsultationandcommunicationproceduresinplaceforallareasofthebusiness yesCodeofconductcirculatedtoallexistingandnewemployees yesEmploymentofyoungpeopleundertheageof15 None

FutureintheUKholdsFSCChainofCustodycertification.ThisrecognisesFuture’scommitmenttosourcingpapersuppliesfromwellmanagedforestry.

WearemembersoftheProfessionalPublishersAssociation(PPA)andsupportitsinitiativeencouragingreaderstorecycletheirmagazinesafteruse.WeincorporatetherecyclelogoinallourUKmagazines.

WeworkinpartnershipwithBath-basedcharitablefoundation,Quartet.

Strategic Report


Statement of Greenhouse Gas (GHG) Emissions for the Group

Global GHG emissions in tonnes of CO2 equivalent:

Emissions from 2013 (base year) 2016

Total Total

Thecombustionoffuel:gasforheatingandfuel; forvehicles(Scope1)

UK 470 131US 102 -Total 572 131

Thepurchaseofelectricity:heat,steamorcooling bytheGroupforitsownuse(Scope2)

UK 1,310 493US 376 8Total 1,686 501

Total Emissions (CO2e Tonnes) 2,258 632Total Revenue £112.3m £59.0mIntensity Ratio (CO2e Tonnes per £1m) 20.1 10.7

WehavereportedonalloftheemissionsourcesrequiredundertheCompaniesAct2006(StrategicReportandDirectors’Reports)Regulations2013.

Theemissionssourcesfallwithinourfinancialstatements.Wedonothaveresponsibilityforanyemissionsourcesthatarenotincludedinourfinancialstatements.

Methodology:WehaveusedtheUKGovernment’sEnvironmentalReportingGuidance.Wehaveappliedthe2016DEFRAGHGConversionFactorRepositorytocalculatetheCO2e.AsaGroupwithonlyoffice-basedactivitiesandnomanufacturingactivities,undertheGHGProtocolCorporateStandard,ouremissionsfallunderScope1(thecombustionoffuel)andScope2(thepurchaseofelectricity).

Notes:

• Scope1–Timeperiodsforcombustionofgasforheating–figuresforallofficesareforthefinancialyear.Allfiguresareestimatesbasedon%shareofofficespacewithinleasedbuildingsexceptforUKBathofficeswhichareactualconsumptionwherewholebuildingsorfloorswithinbuildingshavetheirownmeters.

• Scope1–Timeperiodsforcombustionoffuelinvehicles–onlytheUKoperatesleasedvehiclesandfiguresfortheconsumptionoffuelarebasedonaveragedannualmileage.

• Scope2–Timeperiodsforconsumptionofelectricity–figuresfortheUKandUSofficesareforthefinancialyear.FiguresfortheAustralianofficearepro-ratedfromtypical(August2016)monthlyconsumption.Allfiguresareestimatesbasedon%shareofofficespacewithinleasedbuildingsexceptfortheUSofficein2016andUKBathofficeswhichareactualconsumptionwherewholebuildingsorfloorswithinbuildingshavetheirownmeters.

• Scope2–ElectricitySources–Noelectricitywaspurchasedfromownedorcontrolledsources.

• FugitiveEmissions–theGroupbenefitsfromairconditioninginsomeofitsleaseholdbuildings.Thescaleofemissionsfromleaksisverysmall(estimatedtobelessthan0.5%oftotalemissions)andisdeemedtobeimmaterialtooverallreportingandtrends.

• BaseYear-Financialyear2013isourbaselineyear.

• IntensityRatio-weareusing‘Tonnesper£1millionrevenue’.

• Wehavemaintainedourfocusonotherenvironmentalimpacts,particularlyinitiativestoreducewasteandtocontinuesourcingallourmagazinepaperfromsustainableforestry.

Financial review

13 Future plc

ThefinancialresultsdemonstratethattheGroupisprogressingwellwiththeOptimisationphaseofitsstrategy,withexcitingtimesaheadfollowingtheacquisitionofImagine.

Optimisation

Financial summaryThefinancialreviewisbasedprimarilyonacomparisonofcontinuingresultsfortheyearended30September2016withthosefortheyearended30September2015.Unlessotherwisestated,changepercentagesrelatetoacomparisonofthesetwoperiods.

Continuingoperations2016

£m2015£m

Revenue 59.0 59.8EBITDAE 4.7 3.6Depreciationcharge (0.4) (0.5)Amortisationofintangibleassets (2.0) (2.3)Operatingprofitpre-exceptionalitems 2.3 0.8Exceptionalitems (3.5) (2.5)Impairment (13.0) -Operatingloss (14.2) (1.7)Netfinancecosts (0.7) (0.6)Lossbeforetax (14.9) (2.3)

Losspershare(p) (4.0) (0.6)Adjustedearningspershare(p) 0.4 0.0

Revenue

Grouprevenuewas£59.0m(2015:£59.8m)reflectingthecontinuedchangeinthebusinesswiththenewrevenuestreamsgrowingstronglywhilsttheprintrevenues,asexpected,continuetodecline.UKrevenuewas£44.7m(2015:£47.3m)andintheUS£15.2m(2015:£13.4m).

TheGroup’sfocusisonbuildingrecurringrevenuestreams,whichhaveannuitylikequalities.Theseencompasse-commerceandsubscriptions,andnowrepresent25%oftheGroup’stotalrevenue(2015:22%).

Media

Mediarevenuehasincreasedby14%to£23.9m(2015:£20.9m),drivenbytheGroup’sfastgrowingrevenuestreams,e-commerceandevents.

IntheUK,Mediarevenuesincreasedby8%to£14.1m(2015:£13.1m),drivenbythenewrevenuestreamsofe-commerceandevents.Inonlyitsthirdyear,ThePhotographyShowatBirmingham’sNECgeneratedrevenuegrowthof12%year-on-year.DigitaladvertisingintheUKnowrepresents69%(2015:72%)ofUKadvertisingrevenues.

TheUSalsodeliveredstronggrowth,up24%year-on-yearto£10.4m(2015:£8.4m),withrevenuefromaffiliatesbeingthebiggestdriverofthisgrowth.DigitaladvertisingintheUSnowrepresents88%(2015:85%)ofUSadvertisingrevenues.

Magazine

Magazinerevenuedeclinedinlinewithexpectationsto£35.1m(2015:£38.9m),reflectingthemarket’soverallstructuraldecline.Afocusonsubscriptionrevenues,however,hasincreasedthemixofrecurringrevenuesinthisdivisionto30%from29%in2015.Thedivisionisconstantlylookingforwaystoinnovateandlaunchedfivenewmagazinesintheyear.

“ Operating profit pre-exceptional items has grown 188% year-on-year to £2.3m, reflecting improvements in operational efficiency.”

Penny Ladkin-Brand ChiefFinancialOfficer

andCompanySecretary

Group revenue 2015

1:Media35%2:Magazine65%

Financial Review


EBITDAE

TheGroup’sEBITDAEwasup31%to£4.7m(2015:£3.6m),ofwhich£2.8m(2015:£3.3m)wasUKand£1.9m(2015:£0.3m)wasUS.TheswinginprofitmarginsbetweentheUKandUSisinlargepartareflectionofthestrategytocreateoperationalcentresofexcellenceinlowercostenvironments,withallofthebackofficecostsfortheGroupnowlocatedintheUK.Duringthecourseoftheyear,globalfunctionswereintroducedformostoperationalteams,allowingresourcestobelocatedinthemostfinanciallyandoperationallyeffectivelocations.ThishashelpedtoimprovetheoverallGroupprofitabilitythroughgreateroperationalgearingandallowedtheUSoperationstogrowfromstrengthtostrength.

Future’sheadcountwasfurtherreducedfrom521to449employeesandrationalisationoftheGroup’soverheadbasecontinuedwithafocusonprocessre-engineering.AllwebsiteshavenowbeenmigratedontotheGroup’sproprietaryplatformandaglobalcontentmanagementsystemmigration(CMS);thefinalCMSmigrationwillbecompletedinQ1.ThisputstheGroupinastrongpositiontobenefitfromeconomiesofscaleasthenumberofbrandsincreases.AllacquisitionsmadeduringFY16havebeenfullyintegratedintotheGroup’soperationsandsystems.

Exceptional items and impairment

Exceptionalcostswere£3.5m(2015:£2.5m).Restructuringcostsof£1.8mincludeheadcountreductionandtransformationexpenses.Acreditof£0.5mwasrecognisedasdilapidationcostsforlegacyofficeswerelowerthanoriginallyexpected.

ThebalanceofexceptionalcostsprincipallycompriseacquisitionrelatedcostsinrespectoftheacquisitionofMiura(Holdings)Limited,theultimateparentcompanyofImaginePublishingLimited,whichwascompletedon21October2016.

Anon-cashimpairmentchargeof£13.0mhasbeenrecognisedagainstgoodwillattributabletotheUKbusiness.ThisreflectsashiftintheunderlyingprofitabilityandcashflowsoftheGroupandthecontinueddeclineofprint.

Net finance costs

Netfinancecostswere£0.7m(2015:£0.6m)withtheincreaserepresentingasmallforeignexchangeloss(profitin2015)reflectingthevolatilityofcurrencymarkets.

TheGrouppre-taxlosswas£14.9m(2015:£2.3m).

Taxation

Thetaxcreditfortheyearamountedto£0.5m(2015:£0.3m),comprisingacurrenttaxchargeof£1.3m(2015:creditof£0.3m)andadeferredtaxcreditof£1.8m(2015:£nil)predominantlyrelatedtotherecognitionofaportionofUSlosses.ThecurrenttaxchargearisesintheUKwherethestandardrateofcorporationtaxis20%.

OveralltheeffectiveratefortheGroupwhenappliedtothelossbeforetaxwas3%(2015:13%).TheGroupcontinuestofocusoncompliancewithtaxauthoritiesinallterritoriesinwhichitoperates.

Group revenue 2016

1:Media41%2:Magazine59%

1

2

1

2

Financial review

15 Future plc

(Loss)/earnings per share

2016 2015

Basiclosspershare(p) (4.0) (0.6)Adjustedearningspershare(p) 0.4 0.0

Adjustedearningspershareisbasedonthelossaftertaxationwhichisthenadjustedtoexcludeexceptionalitems,impairmentandrelatedtaxeffects.Thecontinuingadjustedprofitaftertaxamountedto£1.5m(2015:£0.1m)andtheweightedaveragenumberofsharesinissuewas362m(2015:333m).

Dividend

TheBoardisnotrecommendingafinaldividendfortheyear(2015:£nil).

Cash flow and net debt

Netcashat30September2016was£0.5m(2015:netdebt£1.8m),animprovementof£2.3mintheyear.

FollowingtheacquisitionofImagine,theGrouprefinancedImagine’sexistingdebtandsettledoutstandingfeesandotherdealrelatedcosts,totalling£7.4m.

Duringtheyear,therewasacashinflowfromoperationsbeforeexceptionalitemsof£6.5m(2015:£2.3moutflow)arisingfromanimprovementinworkingcapitalandtradingperformance.

Thiswasoffsetby£3.4m(2015:£5.2m)ofexceptionalrestructuringpaymentsmadeintheyear,£1.9m(2015:£2.0m)ofcapitalexpenditure,netproceedsfromashareplacingof£3.1mandpaymentsof£0.9mtofundacquisitions(netofcashacquired).Foreignexchangeandothermovementsaccountedforthebalanceofcashflows.

Credit facility and covenants

TheGrouphadavailablefacilitiesofupto£5.0mat30September2016.FollowingtheacquisitionofImaginetheGroupsecurednewdebtfacilitiestotalling£14.0mexpiringinJune2021.Furtherdetailsofthesenewfacilitiesareincludedwithinnote19.

Going concern

Afterdueconsideration,theDirectorshaveconcludedthatthereisareasonableexpectationthattheGrouphasadequateresourcestocontinueinoperationalexistencefortheforeseeablefuture.ForthesereasonstheDirectorscontinuetoadoptthegoingconcernbasisinpreparingtheconsolidatedfinancialstatementsfortheyearended30September2016.

Post balance sheet event

On21October2016theGroupannouncedthecompletionoftheacquisitionofMiura(Holdings)Limited,theholdingcompanyandultimateparentcompanyofImaginePublishingLimited,forequityconsiderationof£15.3m.

1

2

3

Financial Review


Key performance indicators (KPIs)

ManagementusesanumberofKPIstomeasuretheGroup’soperationalandfinancialperformance,themostimportantoftheseKPIsaresetoutonpage8.

Conclusion

TheGrouphasmovedintoaperiodofoptimisation,withtheacquisitionofImagineprovidingadditionalscaleandcashgenerationandpresentinganumberofexcitingopportunities.TheGroupiswellplacedtoachieveitsambitionsfor2017andbeyond.

TheStrategicReport(whichcomprisestheGroupoverview,Chairman’sstatement,ChiefExecutive’sreview,Strategicoverview,Whatwedo,RisksanduncertaintiesandCorporateresponsibilitysections)andtheFinancialReviewareapprovedbytheBoardofDirectorsandsignedonitsbehalfby:

Penny Ladkin-BrandChiefFinancialOfficerandCompanySecretary13December2016

Strong leadershipBoard of Directors

17 Future plc

Peter AllenIndependentnon-executiveChairman


Manjit WolstenholmeSeniorindependent non-executive

Penny Ladkin-Brand ChiefFinancialOfficerandCompanySecretary

Hugo DraytonIndependentnon-executive

James HanburyDeputyChairman


Peter Allen Chairman sln

PeterwasnamedChairmaninAugust2011.HewasChiefFinancialOfficerofCelltechGroupplcbetween1992and2004.In2003hewasalsoappointedDeputyChiefExecutiveOfficerofCelltechuntilthecompanywassoldin2004.HewasChiefFinancialOfficeroftheelectronicscompanyAbacusGroupplcfrom2005untilthecompanywassoldtoAvnetIncinJanuary2009.PeteriscurrentlyChairmanofClinigenplc,AdvancedMedicalSolutionsGroupplc,OxfordNanoporeTechnologiesLimitedandDiurnalLimited.

James Hanbury DeputyChairman sl

JameswasappointedDeputyChairmaninOctober2016astherepresentativeofDisruptiveCapitalInvestmentsLimited.PriortohisappointmenthewasChairmanofImaginePublishing,whichwasacquiredbyFutureinOctober2016.JamesjoinedtheBoardofImagineinMarch2014soonafterleavingIncisiveMedia,apublishingbusinessheco-foundedin1994.HehasalsopreviouslychairedtheBusinessMediaCouncilofthePPA.JamesalsoactsasanadvisertoanumberofVCbackedbusinesses,isatrusteeforacharitabletrustandhassetupandchairsWARpaint,afundraisingorganisationforseveralarmedforcescharities.

Penny Ladkin-Brand ChiefFinancialOfficer andCompanySecretaryPennywasappointedasChiefFinancialOfficerandCompanySecretaryon3August2015,havingjoinedthebusinessasinterimChiefFinancialOfficerinJune2015.PriortothisshewasCommercialDirectoratAutoTraderGroupplc.Pennyisacharteredaccountantwithabackgroundindigitalmediaandexpertiseindigitalmonetisationmodels.

Zillah Byng-Thorne ChiefExecutive

ZillahwasappointedasChiefExecutiveon1April2014.ShejoinedFutureinNovember2013asChiefFinancialOfficerandCompanySecretary.PriortoherappointmenttotheFutureplcBoard,shewasCFOofTraderMediaGroup–ownerofAutoTrader–from2009to2012,andinterimCEOofTraderMediafrom2012to2013.Beforethis,ZillahwasCommercialDirectorandCFOatFitnessFirstLimitedandChiefFinancialOfficeroftheThresherGroup.Zillahiscurrentlyanon-executiveDirectorofPaddyPowerBetfairplcandGocompare.comGroupplc.Zillahisaqualifiedaccountantandcorporatetreasurer.

Manjit Wolstenholme Seniorindependentnon-executive sln

ManjitjoinedFutureastheseniornon-executiveDirectorinFebruary2011.SheisChairmanofProvidentFinancialplcandCALAGroup,andanon-executiveDirectorofUniteGroupplcandCMCMarketsplc.Afterqualifyingasacharteredaccountantin1988withPricewaterhouseCoopers,Manjitspent13yearswithDresdnerKleinwort,latterlyasco-headofinvestmentbankingincludingmorethanadecadespecialisinginthemediasector.ShewasapartneratGleacherShacklockfrom2004to2006.

Hugo Drayton Independentnon-executive sl

HugojoinedFutureon1December2014.HeisCEOoftheadvertisingtechnologybusiness,InSkinMedia.PriortoISM,hespenttwoyearsasCEOofbehaviouraltargetingspecialist,Phorm,followingtwoyearsasEuropeanManagingDirectorofAdvertising.com.Hespent10yearsatTheTelegraphGroup,asGroupManagingDirector,andpreviouslyasMarketing&NewMediaDirector.HugoisaTrusteeoftheBritishSkinFoundation,chairedtheBritishInternetPublishers’Alliance,andisaregularcontributortotradepressandpublishingconferences.

Corporate G

overnance

s

MemberoftheNominationCommittee

l

MemberoftheRemunerationCommittee

n

MemberoftheAuditCommittee

19 Future plc

Principal activity

TheprincipalactivityoftheCompanyanditssubsidiaries(the‘Group’)asawholeisthepublishingofspecial-interestconsumermagazines,appsandwebsites,andtheoperationofeventsnotablyintheareasof:Technology;GamesandEntertainment;Photography;CreativeandFieldSports.

TheCompanyisincorporatedanddomiciledintheUKandhassubsidiariesoperatingintheUK,theUSandAustralia.

Business review

ThepurposeoftheAnnualReportistoprovideinformationtotheshareholdersoftheCompany.

ReviewsoftheGroup’sactivitiesduringtheyear,thepositionattheyear-endanddevelopmentssincethenaresetoutintheChairman’sstatement,ChiefExecutive’sreview,theCorporateGovernancereportandtheFinancialreview.TheFinancialreviewandStrategicreportexplainfinancialperformance,KPIs,thepositionattheyear-end,anypostbalancesheetevents,anylikelyfuturedevelopmentsandadescriptionoftheprincipalrisksanduncertaintiesfacingtheGroupandhowthesearemanaged.

TheAnnualReportcontainscertainforward-lookingstatementswithrespecttotheoperations,performanceandfinancialconditionoftheGroup.Bytheirnature,thesestatementsinvolveuncertaintysincefutureeventsandcircumstancescancauseresultstodifferfromthoseanticipated.Theforward-lookingstatementsreflectknowledgeandinformation

availableatthedateofpreparationofthisAnnualReportandtheCompanyundertakesnoobligationtoupdatethoseforward-lookingstatements.

Result of 2016 Annual General Meeting

AllresolutionsputtotheAnnualGeneralMeetingheldon3February2016werepassedunanimouslyonashowofhands.Shareholdersholdingmorethan80%ofallissuedsharessubmittedproxyvotesandofthese,morethan87%werecastinfavourofallresolutions.

Reported financial results

Theauditedfinancialstatementsfortheyearended30September2016aresetoutonpages43to78.DetailsoftheGroup’sresultsaresetoutintheconsolidatedincomestatementonpage44andinthenotestothefinancialstatementsonpages54to78.

Dividends

TheBoard’spolicyisthatdividendsshouldbecoveredatleasttwicebyadjustedearningspershare.TheCompany’sEmployeeBenefitTrust(EBT)waivesitsentitlementtoanydividends.

Share capital

TheCompanyhasasingleclassofsharecapitalwhichisdividedintoOrdinarysharesofonepennyeach.TherightsandobligationsattachingtotheCompany’sOrdinarysharesandprovisionsgoverningtheappointmentandreplacementof,aswellasthepowersof,theDirectors,aresetoutintheCompany’sArticlesofAssociation,copiesofwhichcanbeobtainedfromCompaniesHouseintheUKorbywritingtotheCompanySecretary.SaveforrestrictionsthatmayfromtimetotimebesetoutintheCompany’sArticlesofAssociationorimposedbylawsandregulations(includingtheListingRulesoftheFinancialConductAuthority),therearenorestrictionsonthevotingrightsattachingtotheOrdinarysharesoronthetransferoftheOrdinaryshares.TheArticlesofAssociationmaybeamendedonlybyaspecialresolutionoftheCompany’sshareholders.

Detailsofallmovementsinsharecapitalaregiveninnote23onpage72.Asat30September2016,thenumberofsharesinissuewas368.8million.Thisrepresentsanincreaseof10.3%comparedwiththenumberofsharesinissueasat30September2015.InNovember2015,33.4millionshareswereissuedbywayofaplacingofOrdinarysharesintheCompany.ThebalanceofsharesissuedduringtheyearwereissuedinsatisfactionofemployeeshareawardsvestingorShareIncentivePlanmatchingshareawardsduringtheyear.

Directors’ report

Fortheyearended30September2016

Significant shareholdings

At13December2016,theCompanyhadbeennotifiedofthefollowingsignificantinterestsinitsOrdinaryshares:

Shareholder NumberofsharesPercentageof

issuedsharecapital

AberforthPartnersLLP 96,694,195 17.63%DisruptiveCapitalInvestmentsLimited 93,313,544 17.01%SchrodersPlc 85,721,792 15.63%Henderson 75,119,794 13.70%InvestecAssetManagementLtd 28,892,556 5.27%HeraldInvestment 20,765,000 3.79%MrDamianButt 19,412,128 3.54%MrStevenBoyd 18,186,778 3.32%MrMarkKendrick 16,291,461 2.97%

454,397,248 82.86%Directors’holdings(seeopposite) 3,415,444 0.62%Totalofsignificantholdings 457,812,692 83.48%Totalnumberofsharesinissue 548,430,719 100%

TheinformationpresentedinthisDirectors’reportrelatestoFutureplcanditssubsidiaries.TheChairman’sstatement,ChiefExecutive’sreview,FinancialreviewandCorporateresponsibilitystatementareeachincorporatedbyreferenceinto,andformpartof,thisDirectors’report.

Directors’ report


Directors

BiographicaldetailsoftheDirectorsholdingofficeasat13December2016aresetoutonpage18.

Directors’shareholdingsintheCompany’ssharecapitalaresetoutabove.NoDirectorhasanyinterestinanyothersharecapitaloftheCompanyoranyotherGroupcompany,nordoesanyDirectorhaveamaterialinterestinanycontractofsignificancetotheGroup.

Significant agreements

TheprovisionsoftheEuropeanDirectiveonTakeoverBids(asimplementedintheUKintheCompaniesAct2006)requiretheCompanytodiscloseanysignificantagreementswhichtakeeffect,alterorterminateuponachangeofcontroloftheCompany.Incommonwithmanyothercompanies,theGroup’sbankfacility(detailsofwhicharesetoutinnote19onpage67)isterminableuponchangeofcontroloftheCompany.Incommonwithmarketpractice,awardsundercertainoftheGroup’slong-termincentiveplans(detailsofwhicharesetoutintheDirectors’remunerationreportonpage31andnote24onpage72)willvestorpotentiallybeexchangeableintoawardsoverapurchaser’ssharecapitaluponchangeofcontroloftheCompany.ThereisalsoachangeofcontrolprovisionintheserviceagreementsofthetwoexecutiveDirectors,exercisablewithinthreemonthsofachangeofcontrolbytheCompanyorononemonth’snoticebytheexecutivetoexpirenolaterthanthreemonthsfromthedateofthechangeofcontrol.

Financial instruments

InformationinrelationtotheGroup’suseoffinancialinstrumentsissetoutinnote22onpages68to71.

Corporate governance

TheBoard’sreportonthissubjectissetoutonpages23to28.

Political contributions

Nopoliticalcontributionsweremadeduringeitherthecurrentorprioryears.

Conflicts of interest

TheBoardhasasetofprocedurestoensurethat:(i)conflictsofinterestareraisedbyDirectors(andanypotentialDirectorspriortoappointment);(ii)appropriateguidelinesarefollowedbeforeanyconflictisauthorised(includingensuringthatonlyDirectorswhohavenointerestinthematterbeingconsideredwillbeabletotaketherelevantdecisionandintakingthedecisiontheDirectorsactinawaytheyconsider,ingoodfaith,willbemostlikelytopromotetheCompany’ssuccess);and(iii)recordsarekeptofconflictsofinterestandauthorisations.TheDirectorsaresatisfiedthattheBoard’spowersofauthorisationofconflictsareoperatingeffectivelyandthattheprocedureshavebeenfollowed.Theproceduresandanyauthorisationswillcontinuetobereviewedannually.

Corporate responsibility

TheBoardconsidersthatissuesofcorporateresponsibilityareimportant.TheBoard’sreport,includingtheGroup’spoliciesonemployeeinvolvementanddisability,andastatementonGreenhouseGasEmissionsfortheGroup,issetoutonpages11and12.

Annual General Meeting 2016

AttheCompany’seighteenthAnnualGeneralMeeting,whichwillbeheldonWednesday1February2017at10:30amatFuture’sLondonofficeat1-10PraedMews,London,W21QY,anumberofresolutionswillbeproposed.TheresolutionsaresetoutintheNoticeofAnnualGeneralMeetingonpages79to80andanexplanationofallproposedresolutionsisprovidedbelow.

Ordinary resolution 1 – Financial statements

ShareholderswillbeaskedtoapprovethefinancialstatementsoftheCompanyforthefinancialyearended30September2016,togetherwiththereportsoftheDirectorsandauditors.Theauditedfinancialstatementsappearonpages43to78.

Ordinary resolution 2 – Directors’ remuneration implementation report

ShareholderswillbeaskedtoapprovetheDirectors’remunerationimplementationreportforthefinancialyearended30September2016,whichissetoutonpages30to35.

Ordinary resolution 3 – Directors’ remuneration policy report

ShareholderswillbeaskedtoapprovetheDirectors’remunerationpolicyforthethreeyearperiodcommencingon1October2016,whichissetoutonpages36to39.

Notes:1. AllholdingsarebeneficialandincludetheDirectors’personalholdingsandthoseoftheirspouses.2. On21October2016JamesHanburyreceived470,040sharesasconsiderationforhisshareholdinginMiura(Holdings)Limitedandon25November2016hepurchased110,000shares,resultingina

totalholdingof580,040shares.3.On2December2016,PennyLadkin-Brandpurchased121,815sharesandsheisalsodeemedtobeinterestedinthe119,331sharespurchasedbyherhusbandon5December2016,resultingina

totalholdingof391,146shares.4. DetailsoftheshareoptionsandawardsforexecutiveDirectorsaresetoutonpage33.Nosuchoptionsorawardsaregrantedtonon-executiveDirectors.

Directorsinofficeat30September2016Balanceasat

30September2015Purchases

duringtheyearBalanceasat

30September2016

ExecutiveZillahByng-Thorne 421,369 670,000 1,091,369PennyLadkin-Brand - 150,000 150,000Non-executivePeterAllen 1,000,000 100,000 1,100,000ManjitWolstenholme 207,889 45,000 252,889HugoDrayton - - -Total 1,629,258 965,000 2,594,258

Directors’ shareholdings (audited)

Corporate G

overnance

21 Future plc

Ordinary resolutions 4 to 9 – Election of James Hanbury and annual re-election of other Directors

FollowingJamesHanbury’sappointmenttotheBoardon21October2016,hestandsforelectiontoconfirmhisappointment.

Consistentwithourpolicysince2004,allDirectorsareproposedforre-election.BiographicaldetailsofallDirectorsaresetoutonpage18.

FollowingarigorousevaluationandtakingintoaccounttheneedforprogressiverefreshingoftheBoard,theBoardconfirmsthattheperformanceofeachexecutiveandnon-executiveDirectoroftheCompanycontinuestobeeffectiveanddemonstratescommitmenttotherole.TheNominationCommitteehascarefullyconsideredthetimecommitmentsrequiredfromandthecontributionmadebyeachDirectorandboththeNominationCommitteeandtheBoardunanimouslyrecommendthatJamesHanburybeelectedasaDirectorandeachDirectorstandingforre-electionbere-elected.

Ordinary resolutions 10 and 11 – Auditors

AresolutionproposingthereappointmentofPricewaterhouseCoopersLLPasauditorsoftheCompanyandauthorisingtheDirectorstodeterminetheirremunerationwillbeproposedattheAnnualGeneralMeeting.AnexplanationregardingtheBoard’sproposaltoreappointPricewaterhouseCoopersLLPasauditorscanbefoundonpage28intheCorporateGovernancereport.

Ordinary resolution 12 – To authorise the Directors to issue and allot new Ordinary shares

Undertheprovisionsofsection551oftheCompaniesAct2006(the2006Act),theDirectorsmayallotandissueOrdinarysharesonlyifauthorisedtodosobytheCompany’sArticlesofAssociationorbyshareholdersatashareholders’meeting.ConsistentwithguidanceissuedbytheInvestmentAssociationthisresolutionwill,ifpassed,authorisetheDirectorstoallotsharesuptoamaximumnominalvalueof£3,656,200asfollows:

(a)inrelationtoapre-emptiverightsissueonly,equitysecurities(asdefinedbysection560ofthe2006Act)uptoamaximumnominalamountof£3,656,200whichrepresentsapproximatelytwothirdsoftheCompany’sissuedOrdinaryshares(excludingtreasuryshares)asat13December2016.ThismaximumisreducedbythenominalamountofanyRelevantSecuritiesallottedunderparagraph12.2oftheNoticeofAGM;and

(b)inanyothercase,RelevantSecuritiesuptoamaximumnominalamountof£1,828,100whichrepresentsjustunderonethirdoftheCompany’sissuedOrdinarysharesasat13December2016.Thismaximumisreducedbythenominalamountofanyequitysecuritiesallottedunderparagraph12.1oftheNoticeofAGMinexcessof£1,828,100.Ifgranted,thisauthoritywouldreplaceallpreviousauthoritiesgrantedinthisconnection.Theauthoritygrantedbythisresolutionwillexpireon31March2018or,ifearlier,followingtheconclusionofthenextAGMoftheCompany.IftheDirectorsexercisetheauthoritygrantedunderparagraph12.1oftheNoticeofAGM,theywillallstandforre-electionatthefollowingAGM.

TheDirectorsdonothaveanypresentintentionofexercisingthisauthorityotherthaninconnectionwithanyexercisesundershareoptionandothershareincentiveschemes,butintendtoseekthisauthorityeachyear.Inaddition,theremaybecircumstanceswhereitwouldbeappropriatefortheCompanytoissuenewOrdinaryshares,suchasanacquisitionwhereitmightbeappropriatefortheconsiderationtobesettledinwhole,orinpart,bytheissueofnewOrdinaryshares.TheCompanydoesnotholdanysharesintreasury.

Ordinary resolution 13 – Approval of political donations

ItremainsthepolicyoftheCompanynottomakepoliticaldonationsortoincurpoliticalexpenditure,asthoseexpressionsarenormallyunderstood.However,followingbroaderdefinitionsintroducedbythe2006Act,theDirectorscontinuetoproposearesolutiondesignedtoavoidinadvertentinfringementofthesedefinitions.

The2006Actrequirescompaniestoobtainshareholders’authorityfordonationstoregisteredpoliticalpartiesandotherpoliticalorganisationstotallingmorethan£5,000inany12-monthperiod,andforanypoliticalexpenditure,subjecttolimitedexceptions.Thedefinitionofdonationinthiscontextisverywideandextendstobodiessuchasthoseconcernedwithpolicyreview,lawreformandtherepresentationofthebusinesscommunity.Itcouldalsoincludespecialinterestgroups,suchasthoseinvolvedwiththeenvironment,whichtheCompanyanditssubsidiariesmightwishtosupport,eventhoughtheseactivitiesarenotdesignedtosupportortoinfluencesupportforanyparticularpoliticalparty.

Ordinary resolution 14 – Share Consolidation

TheBoardhasbeenadvisedthattheCompanyislikelytobenefitfromaconsolidationofitssharecapitalintermsofreducedsharepricevolatilityandimprovedliquidity.Thisresolutionwilleffecta15for1consolidationoftheCompany’sOrdinarysharecapital(“ShareConsolidation”).

IfapprovedbyshareholdersattheAGMthetotalnumberofissuedOrdinaryshareswillbereducedandthenominalvalueoftheOrdinaryshareswillchangefrom1penceto15pence.AllOrdinarysharesinthecapitaloftheCompanywillbeconsolidatedandeachshareholder’spercentageholdinginthetotalissuedsharecapitaloftheCompanyimmediatelybeforeandaftertheimplementationoftheShareConsolidationwill(saveinrespectoffractionalentitlements)remainunchanged.

TheShareConsolidationisconditionalonthenewOrdinarysharesbeingadmittedtothestandardlistingsegmentoftheOfficialListandbeingadmittedtotradingontheLondonStockExchange’smainmarketforlistedsecurities.ThenewOrdinaryshareswillrankequallywithoneanotherandhavethesamerights,includingvotinganddividendrights,astheexistingOrdinaryshares.

PleaserefertotheFutureplc:ShareConsolidation:FrequentlyAskedQuestions(acopyofwhichisavailableontheCompany’swebsite)forfurtherinformationanddetailsontheShareConsolidation.

Special resolution 15 – Disapplication of statutory pre-emption rights

Resolution15authorisestheDirectorsincertaincircumstancestoallotequitysecuritiesforcashotherthaninaccordancewiththestatutorypre-emptionrights(whichrequireacompanytoofferallallotmentsforcashfirsttoexistingshareholdersinproportiontotheirholdings).Therelevantcircumstancesareeitherwheretheallotmenttakesplaceinconnectionwitharightsissueortheallotmentislimitedtoamaximumnominalamountof£548,430,representingapproximately10%ofthenominalvalueoftheissuedordinarysharecapitaloftheCompanyasat13December2016beingthelatestpracticabledatebeforepublicationofthisnotice.Unlessrevoked,variedorextended,thisauthoritywillexpireattheconclusionofthenextAGMoftheCompanyor31March2018,whicheveristheearlier.TheBoardconfirmsthatitwillonlyallotsharesrepresentingmorethan5%oftheissuedordinarysharecapitaloftheCompany(excludingtreasuryshares)forcashpursuanttotheauthorityreferredtoinparagraph(b)ofresolution15,wherethatallotmentisinconnectionwithanacquisition

Directors’ report



orspecifiedcapitalinvestment(withinthemeaninggiveninthePre–EmptionGroup’sStatementofPrinciples)whichisannouncedcontemporaneouslywiththeallotment,orwhichhastakenplaceintheprecedingsix-monthperiodandisdisclosedintheannouncementoftheallotment.Inrespectoftheauthorityreferredtoinparagraph(b)ofresolution15,theBoardalsoconfirmsitsintentiontofollowtheprovisionsofthePre–EmptionGroup’sStatementofPrinciplesregardingcumulativeusageofauthoritieswithinarollingthree–yearperiodwherethePrinciplesprovidethatusageinexcessof7.5%ofissuedordinarysharecapitaloftheCompany(excludingtreasuryshares)shouldnottakeplacewithoutpriorconsultationwithshareholders,exceptinconnectionwithanacquisitionorspecifiedcapitalinvestmentasreferredtoabove.

Special resolution 16 – General meetings on 14 days’ notice

NoticeperiodsforAGMsmustgiveatleast21days’clearnotice.Forothergeneralmeetings,theoldminimumnoticeperiodof14dayswasincreasedto21daysbytheCompanies(Shareholders’Rights)Regulations2009,unlessshareholdersapproveashorterperiodofatleast14cleardays.Intheinterestsofgreaterefficiency,resolution16seekstorenewapprovalfornoticeperiodsofatleast14cleardays.

Special resolutions 17 and 18 – Amendments to the Company’s Articles of Association

Resolutions17and18containproposedchangestothearticlesofassociationoftheCompany.Thechangeproposedinresolution17,whichisinlinewithcurrentmarketpractice,allowstheDirectorstodonateanysmallamounts(lessthan£3.00)arisingfromaShareConsolidationtocharity.Thechangeproposedinresolution18,ifapprovedbyshareholdersattheAGM,willallowtheBoardofDirectorstopassaBoardresolutiontochangethenameoftheCompany.TheDirectorsarecurrentlyconsideringarebrandingprojectandthisflexibilitywillassistwiththelaunchofthenewbrand.DetailsofanychangeofnamewillbeannouncedinaccordancewiththerequirementsoftheListingRules.

Action to be taken

AformofproxyisincludedwiththisAnnualReportforuseinconnectionwiththeAnnualGeneralMeeting.PleasecompleteandreturntheforminaccordancewiththeinstructionsprintedonittoComputershareInvestorServicesplc,ThePavilions,BridgwaterRoad,BristolBS996ZYassoonaspossibleand,inanyevent,nolaterthan10:30amonMonday

30January2017.ThereturnoftheformofproxywillnotpreventyoufromattendingtheAnnualGeneralMeetingandvotinginpersonifyouwishtodoso.FurtherinformationabouttheAGM,includingaboutelectronicappointmentofproxies,isprovidedonpages81to83.

Recommendations

TheBoardbelievesthateachoftheresolutionstobeproposedattheAnnualGeneralMeetingisinthebestinterestsoftheCompanyanditsshareholdersasawhole.Accordingly,theDirectorsunanimouslyrecommendthatyouvoteinfavourofalloftheresolutionsproposed,astheyintendtodoinrespectoftheirownbeneficialholdings.

Annual General Meeting procedures and result

Asinpreviousyears,theCompanywill:(a)indicatethelevelofproxieslodgedoneachresolutiontogetherwiththebalanceforandagainsteachresolutionandthenumberofabstentions;(b)announcetheresultsofvotingtotheLondonStockExchange;and(c)posttheresultsofvotingonourcorporatewebsite,www.futureplc.com.

Disclosure of information to the auditors

TheDirectorsconfirmthattheyhavecompliedwiththerelevantprovisionsofthe2006Actinpreparingthefinancialstatements.

Inaddition,eachoftheDirectorsconfirmsthat,sofarastheyareaware,thereisnorelevantauditinformationofwhichtheauditorsareunaware.EachDirectorhastakenallreasonablestepstoensurethattheyareawareofanyrelevantauditinformationandthattheauditorsareawareofanyrelevantauditinformation.

Statement of Directors’ responsibilities

TheDirectorsareresponsibleforpreparingtheAnnualReport,theDirectors’remunerationreportandthefinancialstatementsinaccordancewithapplicablelawandregulations.

CompanylawrequirestheDirectorstopreparefinancialstatementsforeachfinancialyear.UnderthatlawtheDirectorshavepreparedtheGroupandParentcompanyfinancialstatementsinaccordancewithInternationalFinancialReportingStandards(IFRSs)asadoptedbytheEuropeanUnion.UndercompanylawtheDirectorsmustnotapprovethefinancialstatementsunlesstheyaresatisfiedthattheygiveatrueandfairviewofthestateofaffairsoftheGroupandtheCompanyandoftheprofitorlossoftheGroupforthatperiod.Inpreparing

thesefinancialstatements,theDirectorsarerequiredto:

::selectsuitableaccountingpoliciesandthenapplythemconsistently;

:: makejudgementsandaccountingestimatesthatarereasonableandprudent;

:: statewhetherapplicableIFRSsasadoptedbytheEuropeanUnionhavebeenfollowed,subjecttoanymaterialdeparturesdisclosedandexplainedinthefinancialstatements;

:: preparethefinancialstatementsonthegoingconcernbasisunlessitisinappropriatetopresumethattheCompanywillcontinueinbusiness.

TheDirectorsareresponsibleforkeepingadequateaccountingrecordsthataresufficienttoshowandexplaintheCompany’stransactionsanddisclosewithreasonableaccuracyatanytimethefinancialpositionoftheCompanyandtheGroupandenablethemtoensurethatthefinancialstatementsandtheDirectors’remunerationreportcomplywiththeCompaniesAct2006and,asregardstheGroupfinancialstatements,Article4oftheIASRegulation.TheyarealsoresponsibleforsafeguardingtheassetsoftheCompanyandtheGroupandhencefortakingreasonablestepsforthepreventionanddetectionoffraudandotherirregularities.

TheDirectorsareresponsibleforthemaintenanceandintegrityoftheCompany’swebsite.LegislationintheUnitedKingdomgoverningthepreparationanddisseminationoffinancialstatementsmaydifferfromlegislationinotherjurisdictions.

EachoftheDirectors,whosenamesandfunctionsarelistedintheBoardofDirectorssectiononpages17and18,confirmthattothebestoftheirknowledge:

(a) theGroupfinancialstatements,whichhavebeenpreparedinaccordancewithIFRSsasadoptedbytheEU,giveatrueandfairviewoftheassets,liabilities,financialpositionandlossoftheGroup;and

(b) theStrategicreportandFinancialreviewincludeafairreviewofthedevelopmentandperformanceofthebusinessandthepositionoftheGroup,togetherwithadescriptionoftheprincipalrisksanduncertaintiesthatitfaces.

ApprovedbytheBoardofDirectorsandsignedonitsbehalfby:

Penny Ladkin-BrandChiefFinancialOfficer andCompanySecretary13December2016

Corporate G

overnance

Our approach to corporate governanceInthisreport,weprovidedetailontheroleoftheBoardofDirectors,followedbyamoredetailedfocusontheworkofeachofthethreekeycommittees:theAuditCommittee,theNominationCommitteeandtheRemunerationCommittee.Together,thesegiveaclearinsightintohowwemanagecorporategovernanceprinciplesandprocesseswithintheGroup.

AsaStandardListedentitytheGroupisnotrequiredtocomplywiththerequirementsoftheUKCorporateGovernanceCode(September2014)(the“Code”)andthereforetheGrouphasnotadoptedtheCode,howevertheDirectorscontinuetocomplywiththespiritoftheCode.

1. Board of Directors

Membership of the BoardTheBoardconsistsoftwoexecutiveandfournon-executiveDirectors.BiographiesofDirectorsanddetailsoftheirothertimecommitmentsaresetoutonpage18.

Board changes during the yearMarkWoodservedasanon-executiveDirectoruntil3February2016ashedidnotseekre-electiontotheBoard.TherewerenootherBoardchangesduringtheyearended30September2016,howeverJamesHanburywasappointedtotheBoardasDeputyChairmanon21October2016.

Role of the non-executive DirectorsThenon-executivesplayacriticalroleontheBoardinoverseeingandscrutinisingtherunningofthebusinessandinensuringthatcorporategovernanceremainsatthetopoftheagenda.

Thenon-executiveDirectorsallservethree-yearterms,terminablebyeitherpartyonthreemonths’noticeatanytimeandsubjecttotheirelectionandannualre-electionorremovalbyshareholders.Althoughannualre-electionisnotarequirementforFuture,webelieveitisthebestwaytoensurenon-executivesaredirectlyaccountabletoshareholders.

Allofthenon-executiveDirectors,withtheexceptionofJamesHanbury,areconsideredtobeindependentbytheBoard.JamesHanburywasappointedtotheBoardasarepresentative

ofDisruptiveCapitalInvestmentsLimited,theCompany’ssecondlargestshareholderfollowingcompletionoftheImagineacquisition,whichhastherighttoappointaDirectortotheBoarduntilsuchtimeasitsshareholdingintheCompanyfallsbelow10percentoftheissuedsharecapital.Consequently,theBoarddoesnotconsiderthatJamesHanburymeetstherelevantindependencecriteria.ManjitWolstenholmeistheSeniorindependentnon-executiveDirector.Thereisagenuinemixofviewsandinsights,aswellasexperience.

Eachnon-executiveDirectorisexpectedtocommit20daysayeartotheirroletoallowforpreparationfor,andattendanceat,BoardandCommitteemeetingsandkeepingintouchwiththeseniormanagementteam,shareholdersandotherstakeholders.

Roles of the Chairman and Chief ExecutiveThedutiesandresponsibilitiesoftheBoardareeffectivelydividedsothattheChairmanleadstheBoardandtheChiefExecutiveleadsthebusiness.

Board meetingsTheBoardhadeightscheduledmeetingsduringthefinancialyearandattendanceissummarisedopposite.TheBoardhadoneunscheduledtelephonemeetingtodiscussandapproveaspectsoftheImagineacquisition,duringwhichtheChairmanandChiefExecutivewerepresent.

AllDirectorsareawareoftheneedtobeavailableandthereisaclearcontactprocess.BoardmeetingsaresometimesprecededbyaninformaldinnerwhereBoardDirectorscanmeetwithanddiscussbusinessissueswiththeGroup’sseniormanagementteam.

ThereisaregularandcomprehensiveexchangeofinformationbetweenmeetingstoensureBoardmembersarewellinformedtoparticipateeffectivelyinmeetings.DirectorsreceiveaBoardpackbeforeeachmeetingwithminutesofthepreviousmeeting,allpapersforagendaitems,areportfromtheCompanySecretarysummarisinganykeylegalissuesandprovidinganyregulatory/legislativeupdates,andasummaryofshareownershipandrecentsharedealing.SimilarpacksareprovidedforallCommitteemeetings.Betweenmeetings,theBoardreceivesamonthlyBoardreportwrittenbytheexecutiveDirectorswhichsummarisesfinancialandoperationalperformanceandprovidesupdatesonkeyprogrammeswithinthebusiness.

Effectivecorporategovernancerequiresnotjustcompliancewithlegislativeandregulatoryrequirements,butalsoapplyingtheprincipleofgoodgovernanceintheboardroomandthroughoutthebusiness.

Good PracticeCorporate Governance report

23 Future plc

Quick find contents

Board of Directors Page23

Audit Committee Page26 Nomination CommitteePage28

Remuneration CommitteePage28

“ Thenon-executivesplayacriticalroleontheBoardinoverseeingandscrutinisingtherunningofthebusinessandinensuringthatcorporategovernanceremainsatthetopoftheagenda.”

Penny Ladkin-Brand ChiefFinancialOfficer andCompanySecretary

ThereisawrittenscheduleofmattersreservedfortheBoardwhichsetsoutthosemattersthatrequireBoardapprovalincludingsettingstrategy,approvingbudgetsandfinancialstatementsandsettinguppolicies.Itwasnotedthat41mattershadbeenconsideredbytheBoardduringtheyear.ThescheduleisavailableontheCompany’swebsiteatwww.futureplc.com.TheBoarddelegatesday-to-dayoperationalmatterstotheGroup’sseniormanagementteam.

DirectorAttendance

(8scheduledmeetings)

PeterAllen 8 of 8 ZillahByng-Thorne 8 of 8ManjitWolstenholme 8 of 8 HugoDrayton 7 of 8PennyLadkin-Brand 8 of 8MarkWood(resigned3February2016) 2 of 2

Boarddecisionsaremadeunanimouslywheneverpossible,butcanbemadebymajority.IfDirectorshaveconcernsthatcannotberesolvedabouttherunningoftheCompanyoraproposedaction,theirconcernsarerecordedintheminutes.Nosuchconcernsaroseintheyear.TheBoardregularlyappointsasub-committeeconsistingofatleasttwoDirectorsinordertofinaliseandapprovethosemattersthathavebeenapprovedinprinciplebytheBoard,subjecttofinalamendmentsonly.Apermanentsub-committeeconsistingofatleasttwoDirectorsexiststoapprovetheissueandallotmentofnewsharesinsatisfactionofemployeeshareschemes.

TheBoardhasanumberofnominatedadvisers(aslistedonpage85).Duringthelastfinancialyearmeetingswereregularlyheldwithkeyadviserstokeepthemawareofissues,andPricewaterhouseCoopersLLPattendedAuditCommitteemeetingsandbriefingswithmembersoftheexecutiveandseniorfinanceteams.

Advice and supportAllDirectorshaveaccesstotheCompanySecretarywhocanadvisethemonissuesofgovernance,bestpracticeandanyotherlegislativeorregulatorymatters.

TheappointmentandremovaloftheCompanySecretaryisaBoarddecision.TheDirectorsmayalsotakeindependentprofessionaladviceattheCompany’sexpenseprovidedthattheygivenoticetotheChairman.Nosuchadvicewassoughtduring2016.TheCompanymaintainsappropriateinsuranceforitsDirectors.

Effective Development

Training and inductionTheBoard’straininganddevelopmentpolicyrequiresthatallnewDirectorsshouldreceiveappropriateinductiononjoiningtheBoard,bothinrespectoftheGroup’sactivitiesasawholeandofeachoperatingcompanyindividually.OngoingtrainingforDirectorsisavailableasappropriatewhetherbypresentationstotheBoardbyseniormanagementormoreformallywhereindividualDirectorsrequesttrainingonspecificissues.ThetraininganddevelopmentneedsofeachindividualDirectorareassessedanddiscussedaspartoftheannualBoardperformanceevaluationprocess.


Summary of performance evaluation

Objectivesfor2016 Stepstakenduring2016

Ensurerobuststrategicgrowthplan Strategyinplacetodeliverdiversifiedrevenuesthroughamixoforganicgrowthandacquisitions.

Successionplanning Internaltalentmatrixdevelopedtoidentifyfuturesuccessors.

Corporate G

overnance

Terms of reference for the Audit, Remuneration and Nomination Committees

ThetermsofreferenceforallCommitteesareavailableon theCompany’swebsiteat www.futureplc.com

i

Corporate Governance report

25 Future plc

TheBoardencouragesappropriatetraining,andregularupdatesandrefreshersessionsareprovidedbytheCompanySecretaryandtheCompany’slegaladvisersandauditors,toinformtheBoardorrelevantCommitteesofimportantchangesinlegislation,regulationandbestpractice.

Performance evaluation

TheDirectorscompletedadetailedBoardperformanceevaluationquestionnaireaspartoftheannualperformanceevaluationprocess.EachquestionnairewasanalysedandtheresultswerepresentedtotheBoardfordiscussion.TheChairmandiscussedtheBoard’sperformanceduringtheyearandanyspecificrequirementsfortraininganddevelopmentwitheachDirector.DuringtheprocesstheBoardalsocompareditsperformancewiththeresultsandrecommendationsfromtheprioryear’sperformanceevaluationsandnotedthattheBoardhadmadesignificantprogressindealingwiththerisksandchallengesidentifiedfortheyear.TheBoardconsidersthisexercisetobeofsignificantvalueinensuringafunctionalandeffectiveBoardandCommittees.

TheChairmanalsometwiththenon-executiveDirectorsduringtheyearwithouttheexecutiveDirectors,inordertoassesstheperformanceoftheexecutiveDirectors.

Going concernTheDirectorsarerequiredtomakeanassessmentoftheGroup’sabilitytocontinuetotradeasagoingconcern.

TheDirectorshavegiventhismatterdueconsiderationandhaveconcludedthatitisappropriatetopreparetheGroupfinancialstatementsonagoingconcernbasis.Thethreemainconsiderationswereasfollows:

a)StrengthoftheGroup’scashflowFollowingcompletionofthetransformationprojectattheendof2015,theGrouphasgeneratedincreasedprofit(beforeexceptionalitems)andhasseenacorrespondingincreaseinthecashflowfromoperationsduringtheyear.

b)ContinuedsupportoftheGroup’sbankFollowingthecompletionoftheacquisitionofImaginePublishing,theGroupnegotiated

anew£14.0mbankfacilitywithHSBCBankplcwhichreplacedtheprevious£5.0mfacilitywithSantanderplc.Thenewfacilityexpireson23June2021andissubjecttocertainfinancialcovenants.TheBoardengagesinregulardialoguewiththebanktokeepitinformedoftheGroup’sperformanceonamonthlybasis.

c)AcquisitionofImaginePublishingTheacquisitionofImagine,inOctober2016,hasstrengthenedtheportfolioandwillenabletheGrouptobenefitfromeconomiesofscaleandenhancedoperationalprofitability.TheImaginebusinessisstronglycashgenerative,whichwillallowtheGrouptoinvestfurtherincoregrowthareas.Furthermore,theacquisitionofferssignificantcostsynergyopportunitiesandtheBoardisconfidentthattheestimatedannualisedcostsynergiesof£3.0mwillbedelivered.

Financial covenant complianceKeycovenantsaretestedquarterly.Duetothechangeofbankersnocovenanttestingwasrequiredatyear-end,howevertheGroupwasinfullcompliancewithallcovenantsatalltestingdatesduringtheyear.UnderthenewcreditfacilitytheGrouphascovenantsinrespectofnetdebt/bankEBITDAEandbankEBITDAE/interest.Furtherdetailsareincludedwithinnote19.

Risk management and internal controlsDetailsoftheprincipalrisksandtheGroup’sapproachtomanagingthemaresetoutonpages9and10.TheBoardconductedanannualreviewoffinancial,operational,legalandcomplianceriskswiththeassistanceofmembersoftheGrouplegalandfinanceteamsandtheExecutiveCommitteetoensurethatthereisasoundsystemofinternalcontrolsinplaceandthatthesearesufficienttomanage(ratherthaneliminate)thoseriskseffectively.Nosignificantfailingsorweaknesseswereidentifiedaspartofthisreview.

TheinternalcontrolsthatareinplacetoensureeffectiveriskmanagementarestructuredtoensureatimelyflowofinformationwithintheGroupandaclearstructureofdelegatedauthorityandresponsibility.ThemainfeaturesoftheGroup’sinternalcontrolandriskmanagementsystemsareexplainedfurtherinthefollowingparagraphs.

“ Goodcorporategovernanceisessentialforthelong-termsuccessoftheCompany.”



TheBoardapprovesasetofcontroldocumentswhichspecify:

(i)variousfinancialandtreasurypoliciestobefollowedacrosstheGroup;and

(ii)thepowersofdelegatedauthorityacrosstheGroup.

TheGroupfinanceteammanagesthefinancialreportingprocessesensuringthatthereisappropriatecontrolandreviewofthefinancialinformationincludingtheproductionoftheconsolidatedfinancialstatements.GroupfinanceissupportedbycommercialfinancedirectorsthroughouttheGroupwhohavetheresponsibilityandaccountabilitytoprovideinformationinaccordancewithourpoliciesandprocedures.

TheExecutiveCommitteeholdsmonthlymanagementmeetingswithcombinedUKandUSseniormanagementinordertoprovideaproperopportunityforfinancialresultsandotherbusinessandoperationalissuestobeexploredandaddressedinatimelymanner.

Internal auditTheAuditCommitteeandtheBoardhaveagainduring2016reconsideredwhetherthereisaneedforaninternalauditfunction.Itwasconcludedthat,whilstanindependentinternalauditdepartmentwiththenecessarytechnicalskillsisnotcurrentlyjustified,theCommitteeshouldcontinuetoreviewthissubjecteachyear.

Whistle-blowing policyAspartofitsinternalcontrols,theGrouphasawhistle-blowingpolicywhichisupdatedregularlyandpublishedontheGroup’sintranettoencourageemployeestoreport,ingoodfaith,anygenuinesuspicionsoffraud,briberyormalpracticeinordertoidentifyanyproblemswithintheGroupatanearlystage.Thepolicyisalsodesignedtoensurethatanyemployeewhoraisesagenuineconcernisprotected.

Relations with shareholders/communicationWeaimtohaveanopenrelationshipwithourshareholders,andshareholderscanfindup-to-dateinformationonGroupactivitiesontheCompany’swebsiteatwww.futureplc.com.ThereisaspecificInvestorRelationssectiononthatsitewhichincludeslinkstoalloftheGroup’spublicannouncementsmadeviathe

RegulatoryNewsServiceoftheLondonStockExchangeincludingtheCompany’slatestannualandinterimresults.

AllDirectorsareavailabletomeetshareholdersattheAGMoronrequestbycontactingtheChairmanorCompanySecretary.Becausemorethan80%oftheCompany’ssharesareheldbymajorinstitutions,theexecutiveDirectorsholdaseriesofmeetingspresentingtheinterimandannualresultstotheseinstitutionsinordertoupdatethemontheprogressofthebusinessandgaugetheirviewsfollowingtheanalystpresentationsoftheresults.

InorderthatallDirectorsareawareoftheviewsofshareholders,BoardpacksincludeanoteofviewsasexpressedbyshareholdersduringmeetingsheldwithDirectorsorasreportedtoDirectorsthroughtheCompany’sbrokers,togetherwithcopiesofanalysts’notes,pressarticlesandotherrelevantinformation.

2. Audit Committee

MemberAttendance


ManjitWolstenholme1

(Chairman) 3 of 3

PeterAllen 3 of 3

1.TheChairmanoftheCommittee,ManjitWolstenholme,hasrecentandrelevantfinancialexperience.

TheAuditCommittee’sprimaryobjectiveistoprovideeffectivefinancialgovernanceandmonitortheintegrityoftheGroup’sfinancialstatementsandinternalcontrols.

TheAuditCommitteemeetsbeforetheinterimandannualresultsannouncementsandreviewstherelevantfinancialresultswiththeexecutivemanagementteamandtheexternalauditors.TheAuditCommitteealsomeetsseparatelyforthepurposesofplanningtheauditprocess,monitoringitseffectiveness,reviewingtheGroup’srelationshipwiththeexternalauditorsandundertakingadetailedreviewoftheGroup’sinternalcontrolsandriskmanagementsystems.Itconsideredwhetherthe2016AnnualReportwasfair,balancedandunderstandableandadvisedtheBoardaccordingly.

Corporate G

overnance

Re-election of Directors

WearenotrequiredtoofferallourDirectorsupforannualelection,however,allourDirectorstakeindividualandcollectiveresponsibilityforthedecisionsthattheBoardmakesandarehappytoletshareholdersjudgetheirperformancebystandingforannualre-election.WehavefollowedthispracticesincetheAGMin2005.

i

TheAuditCommitteecarriesoutthefunctionsrequiredbyrule7.1.3oftheDisclosureandTransparencyRules.

Significant financial reporting judgements TheAuditCommitteediscussedthekeyrisksandjudgementswithmanagementandtheauditorsaspartoftheauditplanningprocessinJuly2016.Atthesametimetheydiscussedandagreeduponappropriatelevelsofmaterialityinthecontextoftheanticipatedresultsfortheyear.Asaresultofthosediscussionsanauditplanwasagreedandsubsequentlyexecuted.

Thesignificantjudgementsconsideredinrelationtothefinancialstatementsfortheyearended30September2016,whichwereoriginallyidentifiedanddiscussedaspartoftheplanningprocessreferredtoabove,aresetoutbelowandwereaddressedasfollows:

1.RevenuerecognitionTheareaofrevenuewhichcarriesthemostjudgementisnewstraderevenue(bothdomesticandexport).Managementhascarefullyconsideredtheestimatesofreturnsmadeinrespectofnewstraderevenuesandtherecognitionofrevenuesonthelargeradvertisingcontractsandhaveconcludedthattheyareappropriate.TheestimatesandjudgementsmadehavebeendiscussedwiththeauditorsandtheAuditCommittee.

2.Carryingvalueofgoodwillandlonglivedassets.IAS36requiresanimpairmenttesttobeperformedforgoodwillonanannualbasisorwherethereisanindicationofimpairment.ManagementpreparedadetailedimpairmentassessmentoftheUKbusinessat30September2016andconcludedthatanimpairmentof£13.0mwasrequired.

Thekeyassumptionsmadeinthatassessmentwereasfollows:

-Longtermgrowthratetoperpetuity2.0%-EBITDAEmarginsassumed2.4%to3.7%-Discountrate(post-tax)8.2%

TheAuditCommitteeagreedwithmanagement’sconclusionthatanimpairmentof£13.0mwasrequiredinordertoreflectthevalueinuseoftheUKbusiness,reflectingashiftintheunderlyingprofitabilityandcashflowsoftheGroupandthecontinueddeclineofprint.

3.GoingconcernTheAuditCommitteehasconsideredthegoingconcernassumptionassetoutonpage25.Managementprepareddetailedassessmentsofgoingconcernthatsetoutallrelevantconsiderations.ThesewerereviewedindepthbytheAuditCommittee,whoconfirmedthattheseassessmentscontinuedtosupportthepositionoftheGroupasagoingconcern.

4.ExceptionalitemsDuetotherestructuringofthebusinessintotwodivisionsandcontinuedtransformationalactivitythereareanumberofitemsconsideredexceptionalinnature.TheAuditCommitteeconsideredtheitemsandconcludedthattheseitemsshouldbepresentedasexceptional.

5.TaxTheAuditCommitteehasreviewedthetaxpositionoftheGroupwithmanagementandtheauditors.Duringtheyear,theCommitteehasbeenactivelyinvolvedinconsideringanyareasofjudgementrelatingtotaxpositionsintheUK,USandAustralia.

Audit feesTheAuditCommitteehasreviewedtheremunerationreceivedbyPricewaterhouseCoopersLLPfornon-auditworkconductedduringthefinancialyear.Thefeesfornon-auditworkwerehigherthantheauditfeeduetoworkperformedinareportingaccountantcapacity,taxationservicesandduediligenceinrespectoftheImagineacquisition.Forfurtherdetailsregardingfeespaid,seenote3tothefinancialstatementsonpage55.

Auditor independenceTheAuditCommitteemonitorstheCompany’ssafeguardsagainstcompromisingtheobjectivityandindependenceoftheexternalauditorsbyperforminganannualreviewofnon-auditservicesprovidedtotheGroupandtheircost,reviewingwhethertheauditorsbelievethereareanyrelationshipsthatmayaffecttheirindependenceandobtainingwrittenconfirmationfromtheauditorsthattheyareindependent.TheCommitteehasreviewedtheGroup’sauditindependencepolicyandiscomfortablethatitalignstotheFinancialReportingCouncil’slatestguidance.

Corporate Governance report

27 Future plc

“ TheAuditCommittee’sprimaryobjectiveistoprovideeffectivefinancialgovernance.”

Manjit Wolstenholme Chairman of the Audit Committee


Forthefinancialyearended30September2016,theAuditCommitteehasconducteditsreviewoftheauditors’independenceandconcludedthatnoconflictofinterestexistsbetweenPricewaterhouseCoopersLLPauditandnon-auditwork,andthattheirinvolvementinnon-auditmatters,which(asnotedopposite)mainlycomprisedadviceinrespectoftheImagineacquisitionandtaxation,wasthemosteffectivewayofconductingtheGroup’sbusinessduringtheyear.

Auditor appointment policyTheAuditCommitteehasrevieweditspolicyforappointingauditorsandawardingnon-auditwork.

TheGrouphasusedPricewaterhouseCoopersLLPforduediligenceandreportingaccountantworkontheacquisitionofImagine.TheAuditCommitteeconsideredwhetherthisconstitutedathreattoindependenceandconfirmedthatitwascomfortablethattherewereappropriatesafeguardsinplace.GiventherecentchangesintheFinancialReportingCouncil’sauditindependenceguidelinestheCommitteehasconfirmedthat,from1October2016,itwillnolongerusePricewaterhouseCoopersLLPforanytaxcomplianceoradvisoryservicesaslongastheyaretheGroup’sauditor.

OntherecommendationoftheAuditCommittee,theBoardhasdecidedthatitisinthebestinterestsoftheCompanytoputaresolutiontoshareholdersthatPricewaterhouseCoopersLLP,whohavebeentheCompany’sexternalauditorfor17years,bereappointedasauditorsfortheforthcomingyear.TheresolutiontoappointPricewaterhouseCoopersLLPwillproposethattheyholdofficeuntiltheconclusionofthenextAnnualGeneralMeetingatwhichaccountsarelaidbeforetheCompany,atalevelofremunerationtobedeterminedbytheDirectors.

3. Nomination Committee

MemberAttendance

(1scheduledmeeting)

PeterAllen(Chairman) 1 of 1ManjitWolstenholme 1 of 1HugoDrayton 0 of 1

FollowingdiscussionoftheskillsandcontributionofeachDirector,theNominationCommitteesupportstheproposedre-electionofallDirectorsstandingforre-electionatthe2017AGMandtheelectionofJamesHanburytoconfirmhisappointmenttotheBoard.Inlinewithbestpractice,eachCommitteememberseekingre-electionwasexcludedfromapprovingtheproposalfortheirre-election.

4. Remuneration Committee

MemberAttendance


ManjitWolstenholme(Chairman) 3 of 3

PeterAllen 3 of 3HugoDrayton 2 of 3

Therewerethreescheduledmeetingsduringtheyear.

TheRemunerationCommitteedeterminestheremunerationpackagesofexecutiveDirectors,includingperformance-relatedawardsandshare-basedincentives,remunerationpolicy,whichincludestheindividualbonustargetsforexecutiveDirectorsandperformancecriteriaattachedtoshare-basedincentives,theremunerationoftheChairman,recommendationsofremunerationlevelsfornon-executiveDirectorsandseniormanagementinlinewithindustryremunerationpackagesandtheimplementationofanynewshare-basedincentiveschemeproposedtobeimplemented.TheDirectors’remunerationreportissetoutonpages29to39.


Penny Ladkin-BrandChiefFinancialOfficer andCompanySecretary13December2016

Corporate G

overnance

Investor Relations

ForcopiesofalloftheGroup’spublicannouncementsmade viatheRNSandcopiesof theCommittees’termsof referencevisit

www.futureplc.com/invest-in-future

i

Directors’ remuneration report


29 Future plc

Annual statement

Dearshareholders,

IampleasedtopresenttheDirectors’remunerationreportforthefinancialyearended30September2016.ThisreporthasbeenpreparedonbehalfoftheFutureplcBoardbytheRemunerationCommittee,andhasbeenapprovedbytheFutureplcBoard.

AsrequiredundertheLargeandMedium-sizedCompaniesandGroups(AccountsandReports)(Amendment)Regulations2013(Sl2013/1981)Directors’RemunerationRegulations,thisreportissplitintothreesections:thisletter,anImplementationreport,settingoutdetailsofDirectors’remunerationforthefinancialyearended30September2016,andaRemunerationpolicyreport,settingouttheGroup’sforwardlookingremunerationpolicy(“Policy”)forexecutiveandnon-executiveDirectorsforthethree-yearperiodfrom1October2016.

ThekeychallengesfacedbytheRemunerationCommitteeduringtheyearweredeterminingandsettingincentivesforthenewadditionstotheseniormanagementteamwhichhasevolvedoverthepastyear,ensuringalignmentwiththeexecutiveDirectors,andsettingappropriateperformancetargetsforshort-termandlong-termincentivesforbothexecutiveDirectorsandseniormanagementduringthisperiodofsignificantchangefortheGroup.

ThePolicywillbesubjecttoabindingshareholdervoteattheCompany’sAGMon1February2017andwilltakeeffectimmediatelythereafter.

Duringtheyearto30September2016,theCommitteehasconsideredthelevelandmake-upoftheexecutiveDirectors’remunerationpackages,includingthegrantofshare-basedincentiveawardsandthebasisofperformance-relatedbonuses,detailsofwhicharesetoutintheImplementationreportandthePolicy.TheCommittee,inparticular,focuseditseffortsatthebeginningofthefinancialyearonupdatingtheperformancetargetsofthePerformanceSharePlan(PSP)tobetteraligntotheinterestsofshareholders,aswellasupdatingtherulesoftheDeferredAnnualBonusScheme(DABS).TheCommitteehascommencedconsultationswithmajorshareholdersinrelationtocertainchangestothePSP,including:(i)increasingthemaximumvalueofanawardasapercentageofsalaryto400%inrelationtoanyemployeeshareincentiveschemesonanexceptionalbasis,and(ii)thelevelofdilutionforexistingshareholders.

TheremunerationphilosophyisdesignedtoensurethatrewardforperformanceiscompetitiveandappropriateforthetransformationalphasethattheGrouphasundergoneandtoattractandretainthetalentrequiredtodeliverthegrowthambitionsoftheGroup.Theremunerationpolicyseekstoalignremunerationwithshareholderinterestsbasedontheachievementofstrategicobjectivesandfinancialperformance.Asaresult,remunerationlevelsaredesignedtoreflecttherelativeperformanceofthebusinessfortherelevantperiod.

WebelievethatthePolicywillincentivisetheexecutiveteamtodelivergrowthintheshort,mediumandlongtermandhopetoreceiveyourcontinuedsupportattheCompany’s2017AGM.

Manjit Wolstenholme13December2016

Theremunerationphilosophyisdesignedtoensurethatrewardforperformanceiscompetitiveandappropriateforthefuturedevelopmentof,andresultsdeliveredby,theGroup.Theremunerationpolicyseekstoalignremunerationwithshareholderinterestsbasedontheachievementofstrategicobjectivesandfinancialperformance.

Quick find contents

Implementation reportPage30

Remuneration policy report Page36


Implementation report

Corporate G

overnance

Remuneration Committee

Threeindependentnon-executiveDirectorsservedontheRemunerationCommitteeduringtheyearto30September2016:ManjitWolstenholmechairstheCommitteeandbothPeterAllenandHugoDraytonservedthroughouttheyear.PennyLadkin-BrandactedasSecretarytotheCommitteethroughouttheyear.

TheCommitteeisresponsiblefordeterminingthebasicannualsalaries,incentivearrangementsandtermsofemploymentofexecutiveDirectors,formakingrecommendationsregardingnon-executiveDirectors’fees,thelevelandmake-upoftheremunerationpackagesofseniormanagers,includingbonusschemesandshare-basedincentives,andensuringthatremunerationpoliciesandpracticesdonotencourageexcessiverisk-taking.TheCommitteeisalsoresponsibleforfixingtheChairman’sremunerationandapprovingthetermsofanynewshare-basedincentiveschemeforanyemployeesoftheGroup,subject,whereappropriate,toshareholderapproval.

ItistheBoardthatisresponsiblefordeterminingtheremunerationofnon-executiveDirectorsfollowingtherecommendationoftheCommitteeassetoutonpage32.

NoDirectorisinvolvedindecidinghisorherownremuneration.Asexplainedonpage24,thetermsofreferenceoftheRemunerationCommittee,reviewedannually,areavailableontheCompany’swebsite.

Performance-related bonus (Annual Bonus Scheme)

Operation of the scheme

Theperformance-relatedbonusissubjecttobothprofitrelatedandsubjectiveindividualperformancecriteria,with20%ofthepotentialmaximumperformance-relatedbonuspayablebeingsubjecttosubjectiveindividualperformancecriteriadeterminedbytheCommittee,althoughtheCommitteehasdiscretiontovarythepotentialtotalmaximumbonus,theweightingofthevariableelementsandthestretchofthetargetsinordertoincentiviseorrecruitexecutiveDirectors,

providedthatthetotalpotentialmaximumbonuspayableforanyyearshallnotexceed150%ofsalaryandthebonusshallonlybepayableforoverperformance.Thepotentialmaximumperformance-relatedbonuspayableundertheAnnualBonusSchemeduring2016was120%ofbasicannualsalarytoZillahByng-ThorneasChiefExecutiveand50%ofbasicannualsalarytoPennyLadkin-BrandasChiefFinancialOfficer.

Paymentofanyperformance-relatedbonusundertheAnnualBonusSchemeisusuallymadeinDecember,followingannouncementofthepreliminaryresultsandconclusionoftheauditinrespectoftheprecedingfinancialyear.Paymentofanyperformance-relatedbonusisalsosubjecttotheexecutiveDirectorbeingintheCompany’semploymentatthetimeofpaymentofsuchperformance-relatedbonusandnothavinggivenorreceivednoticeofterminationofemploymentandcertainothereventsnothavingoccurred.

Single Total Figure of Remuneration (audited)

TheremunerationoftheDirectorsissetoutbelow:

Salary/fees Benefits1 Annualbonus2 PSP2 Pension Total

2016 £’000

2015 £’000

2016£’000

2015£’000

2016 £’000

2015 £’000

2016 £’000

2015 £’000

2016£’000

2015£’000

2016 £’000

2015 £’000

Executive Directors in office as at 30 September 2016ZillahByng-Thorne3 300 296 10 10 - 128 - - 37 37 347 471PennyLadkin-Brand 178 29 - - - 15 - - 8 - 186 44Total for executive Directors 478 325 10 10 - 143 - - 45 37 533 515

Non-executive Directors in office as at 30 September 2016PeterAllen 101 120 - - - - - - - - 101 120ManjitWolstenholme 50 49 - - - - - - - - 50 49HugoDrayton 40 33 - - - - - - - - 40 33Total for non-executive Directors 191 202 - - - - - - - - 191 202

Former non-executive DirectorMarkWood 13 20 - - - - - - - - 13 20

Total 682 547 10 10 - 143 - - 45 37 737 737

Notes:1. BenefitsforexecutiveDirectorscompriseprincipallycarallowance,privatehealthinsuranceandlifeassurance.TherewerenotaxableexpensespaidtoanyDirectorintheyear.2.DetailsrelatingtotheAnnualBonusSchemeandthePerformanceSharePlan(“PSP”)aresetoutonpages30to32.3.Witheffectfrom1July2016,ZillahByng-Thornereceivedacashsupplementinlieuofpensioncontribution.Thisadditionalcashpaymentisnotincludedindeterminingherentitlementtoanybonus,

share-basedincentiveorpensionentitlement.4.JamesHanburywasappointedtotheBoardon21October2016andconsequentlynoremunerationisincludedinthetableabove.

ThefollowingreportprovidesdetailsofDirectors’remunerationfortheyearended30September2016.Insettingremunerationfortheyear,theCommitteeappliedtheprinciplessetoutintheRemunerationpolicyreport.



31 Future plc

Performance targets

Theprofitcriteriaforpaymentoftheperformance-relatedbonussetfor2016wasinarangefrom90%to110%targetEBITDAE,asfollows:

::IfEBITDAEismorethan10%belowtargetEBITDAE,noprofit-relatedbonuswillbepayable.

::IfEBITDAEis10%belowtargetEBITDAE,20%ofthepotentialmaximumoftheprofit-relatedbonuswillbepayableintheeventthattheCommitteedetermines,initsabsolutediscretion,thatsuchpaymentismeritedbytheindividual.

::IfEBITDAEis5%belowtargetEBITDAE,35%ofthepotentialmaximumoftheprofit-relatedbonuswillbepayableintheeventthattheCommitteedetermines,initsabsolutediscretion,thatsuchpaymentismeritedbytheindividual.

::IfEBITDAEtargetisachieved,50%ofthepotentialmaximumoftheprofit-relatedbonuswillbepayable.

::IfEBITDAEtargetisexceededby5%,75%ofthepotentialmaximumoftheprofit-relatedbonuswillbepayableintheeventthattheCommitteedetermines,initsabsolutediscretion,thatsuchpaymentismeritedbytheindividual.

::IfEBITDAEtargetisexceededby10%ormore,100%ofthepotentialmaximumoftheprofit-relatedbonuswillbepayable.

::IfEBITDAEfallsinbetweenanyoftheabovelevels,apercentageofthepotentialmaximumprofit-relatedbonuswillbepayable,onaproratabasistothelevelsexpressedabove,intheeventthattheCommitteedetermines,initsabsolutediscretion,thatsuchpaymentismeritedbytheindividual.

TheEBITDAEtargetisnotdisclosedasthisisbelievedtobeacommerciallysensitivenumberbutitissetbytheCommitteetobechallengingandissetbyreferencetothebudgetfortherelevantfinancialyear.TheindividualperformancecriteriasetbytheCommitteeweredesignedtorewardthesuccessfulimplementationofspecificelementsoftheGroup’sfinancialandoperationalstrategy.

Paymentofanypartoftheindividualperformance-relatedbonusissubjecttothe90%EBITDAEfloorbeingachieved.

Actual performance against targets for the year

BasedonEBITDAEperformanceachievedfor2016,andonindividualperformancemeasures,theChiefExecutivewaseligibleforabonusof60%ofsalaryandtheChiefFinancialOfficerwaseligibleforabonusof25%ofsalary.TheseawardswerewaivedbytheexecutiveDirectorsinlieuofatransactionbonuspaidfollowingthesuccessfulcompletionoftheacquisitionofImaginePublishinginOctober2016.

2005 Performance Share Plan (PSP)

Operation of the scheme

ThePSPhasbeeninoperationsince2005andisdesignedtorewardperformanceoverathree-yearperiodinthecontextofperformancetargetswhicharedesignedtoaligntheinterestsoftheexecutiveDirectorswiththoseoftheshareholders.Thosetargetsaresetoutbelowandopposite.Themaximumamountofanawardinanyfinancialyearisnormally100%ofbasicannualsalary.However,inexceptionalcircumstances,whereitisfeltnecessarytoprovidefurtherincentivetotheexecutiveDirectors,awardsofupto200%ofbasicannualsalarymaybeapproved.AwardsunderthisschemearegrantedtoexecutiveDirectorsandkeyseniorexecutivemanagement.ThePSPexpiresinJanuary2025,followingitsrenewalinJanuary2015forafurther10years.

SubjecttotheexecutiveDirectorsremaininginemploymentatthevestingdate,awardsgrantedshallvestsubjecttothefollowingperformancecriteriahavingbeenmetattheendoftherelevantthree-yearmeasurementperiod.

Performance criteria in respect of awards granted between 30 November 2015 and 30 September 2016

Earnings Per Share (50% of award)

EPSforthelastfinancialyearoftheperformanceperiodofatleast1.2pforthispartoftheawardtovest(atthislevelthevestedamountis25%ofthispartoftheaward),withfullvestingat1.5pandonastraight-linebasisbetweentheseamounts.

Net Cash Flow (50% of award)

NetCashFlowforthelastfinancialyearoftheperformanceperiodofatleast£(0.25)mforthispartoftheawardtovest(atthislevelthevestedamountis25%ofthispartoftheaward),withfullvestingat£0.75mandonastraight-linebasisbetweentheseamounts.

Performance criteria in respect of awards granted between 4 February 2015 and 29 November 2015

InFebruary2016,theRemunerationCommitteeexerciseditsdiscretiontochangetheperformancecriteriainrespectof50%ofawardsgrantedbetween4February2015and29November2015fromTSRperformancetonetcashflowinordertobetteraligntheinterestsofparticipantsandshareholders.TherewasnochangetotheEPSperformancecriteriainrespectoftheremaining50%oftheseawards.Therevisedperformancecriteriaareasfollows:


EPSforthelastfinancialyearoftheperformanceperiodofatleast1.0pforthispartoftheawardtovest(atthislevelthevestedamountis25%ofthispartoftheaward),withfullvestingat1.4pandonastraight-linebasisbetweentheseamounts.

Net Cash Flow (50% of award)

NetCashFlowforthelastfinancialyearoftheperformanceperiodofatleast£0.25mforthispartoftheawardtovest(atthislevelthevestedamountis25%ofthispartoftheaward),withfullvestingat£1.25mandonastraight-linebasisbetweentheseamounts.

Performance criteria in respect of awards granted prior to 4 February 2015


GrowthinEPSoverthethreeyearsofatleastannualRetailPriceIndex(RPI)+3%forthispartoftheawardtovest(atthislevelthevestedamountiszero)withfullvestingatannualRPI+8%andonastraight-linebasisbetweenthetwo.

Total Shareholder Return (50% of award)

TheCompany’sTSRperformanceiscomparedagainstabasketofcomparatorcompaniescomprisingatalltimesaminimumof15companies.

32AnnualReportandAccounts2016C

orporate Governance

IftheCompany’sTSRperformanceplacesitbelowmedianranking,noneofthepartoftheawarddependentonTSRperformancewillvest.IftheTSRperformanceplacesitinmedianranking,25%ofthispartoftheawardwillvestthroughto100%iftheCompanyisrankedintheupperquintile,i.e.top20%.Betweenmedianandupperquintile,thispartoftheawardwillvestonaproratastraight-linebasis.

InrespectoftheTSRperformanceforawardsgrantedfrom16December2013to3February2015,theCompany’sTSRperformancewasmeasuredagainstthefollowingbasketofcomparatorcompanies:

Bloomsbury PublishingCentaur MediaEbiquityHaynes PublishingHuntsworthITE GroupJohnston PressM&C SaatchiPearsonQuarto GroupSTV GroupTen AlpsTrinity MirrorWilmington GroupyouGov

Performance against targets in respect of the 17 December 2012 awards

TheCommitteeexerciseditsdiscretiontowaivetherequirementforMarkWoodtoremainemployedwithintheGroupatthevestingdateandtoallowtheawardtovestonaproratabasisinDecember2015,subjecttotherelevantperformancecriteriahavingbeenmet.ThemovementinEPSfortherelevantmeasurementperiodwas-82%forthetotalGroupandTSRperformanceplacedtheCompany16thwithinthegroupof18comparatorcompanies.Consequently,theremainderofthePSPawardgrantedtoMarkWoodon17December2012lapsedinitsentiretyon17December2015.

Performance against targets in respect of the 16 December 2013 awards

TheCommitteeexerciseditsdiscretiontowaivetherequirementforMarkWoodtoremainemployedwithintheGroupatthevestingdateandtoallowtheawardtovestonaproratabasisinDecember2016,subjecttotherelevantperformancecriteriahavingbeenmet.ThemovementinEPSfortherelevantmeasurement

periodwas-33%forthetotalGroupandTSRperformanceplacedtheCompany13thwithinthegroupof16comparatorcompanies.Consequently,thePSPawardgrantedtoZillahByng-ThorneandtheremainderofthePSPawardgrantedtoMarkWoodon16December2013willlapseintheirentiretyon16December2016.

Performance against targets in respect of the 16 July 2014 award

ThemovementinEPSfortherelevantmeasurementperiodwas-33%forthetotalGroupandTSRperformanceplacedtheCompany13thwithinthegroupof16comparatorcompanies.Consequently,thePSPawardgrantedtoZillahByng-Thorneon16July2014willlapseinitsentiretyon16July2017.

Non-executive Directors’ remuneration

Non-executiveDirectorsdonotparticipateinanyoftheCompany’sshareincentivearrangements,nordotheyreceiveanybenefits.Theirfeesarereviewedeverythreeyears.TheChairman’sfeesaresetbytheCommittee,andthoseforthenon-executiveDirectorsaresetbytheBoardasawhole.TheChairman’sfeewasreducedfrom£120,000to£95,000witheffectfrom1January2016.

Pension entitlements (audited)

Theonlyelementofremunerationthatispensionableisbasicannualsalary,excludingperformance-relatedbonusesandbenefitsinkind.Employer’spensioncontributionsarepayablefortheexecutiveDirectorsatarateof12.5%fortheChiefExecutiveandupto6%fortheChiefFinancialOfficer.Witheffectfrom1July2016,ZillahByng-Thornereceivesherentitlementtoemployer’spensioncontributionsincashasasalarysupplement.Thisadditionalcashpaymentisnotincludedindeterminingherentitlementtoanyperformance-relatedbonus,share-basedincentiveorpension.

TheliabilityoftheCompanyinrespectoftheexecutiveDirectors’pensionsamountsto£744asat30September2016.Normalretirementageundertheschemerulesis75.

Payments to past Directors (audited)

NopaymentsweremadetoanypastDirectorsduringthefinancialyearended30September2016.

Payments for loss of office (audited)

Duringthefinancialyearto30September2016nopaymentsinrespectoflossofofficeweremade.

Statement of Directors’ shareholding and share interests (audited)

TheCompanyhasapolicyonshareownershipbyexecutiveDirectorswhichrequiresthatanysuchDirectorshouldaccumulateaholdinginsharesoverafiveyearperiodfromappointmentwherethevalueofthosesharesrepresentsatleastonetimessalary.

InrespectofZillahByng-Thorne,therelevantfiveyearperiodcommencedon1November2013andwillendon31October2018.Asat13December2016,ZillahByng-Thornehasaholdingof1,091,369shares,ofwhich191,738werepurchasedatapriceof7.75pon16July2014,185,018werepurchasedatapriceof7.99pon21November2014,44,613werepurchasedatapriceof11.13pon18May2015and670,000werepurchasedatapriceof10.00pon27November2015thenon4December2015the670,000sharesweretransferredtoZillahByng-Thorne’spersonalSIPPbywayofanon-marketsaleandpurchaseatapriceof11.00p.

InrespectofPennyLadkin-Brand,theperiodcommencedon3August2015andwillendon2August2020.Asat13December2016,PennyLadkin-Brandhasaholdingof391,146shares,ofwhich150,000werepurchasedatapriceof10.00pon27November2015,121,815shareswerepurchasedatapriceof12.21pon2December2016and119,331shareswerepurchasedbyherhusbandatapriceof12.61pon5December2016.

DetailsofDirectors’shareholdingsaresetoutonpage20oftheDirectors’report.



33 Future plc

Directors’ interests in share schemes (audited)

DetailsofoptionsandothershareincentivesheldbyexecutiveDirectorsandmovementsduringtheyeararesetoutbelow,includingdetailsoftheawardsmadeduringtheyear.

Dateofgrant

Pricepaid

for grant

Earliest exercisedate

Expiry date

Exerciseprice per

share(p)

Balanceat1Oct2015

Grantedduringthe

year3

Vestedduringthe

year

Lapsed unexercised

during theyear

Balance at 30 Sept

2016

PSP1

MarkWood4 17Dec2012 Nil 17Dec2015 N/A Nil 678,159 - - (678,159) -16Dec2013 Nil 16Dec2016 N/A Nil 156,022 - - - 156,022

ZillahByng-Thorne 16Dec2013 Nil 16Dec2016 N/A Nil 2,000,000 - - - 2,000,00016Jul2014 Nil 16July2017 N/A Nil 2,500,000 - - - 2,500,000

30 Nov 2015 Nil 30 Nov 2018 N/A Nil - 2,500,000 - - 2,500,000PennyLadkin-Brand 3Aug2015 Nil 3Aug2018 N/A Nil 1,647,834 - - - 1,647,834

30 Nov 2015 Nil 30 Nov 2018 N/A Nil - 1,250,000 - - 1,250,000Sharesave2

ZillahByng-Thorne 13Dec2013 Nil 1Feb2017 1Aug2017 13.0 69,230 - - - 69,230

Notes:1. TheperformancecriteriawhichapplytoawardsgrantedunderthePSPschemearesetoutonpages31and32.2. DetailsoftheSharesavescheme,whichhasnoperformanceconditions,aresetoutinnote24onpage74.3. ThemarketpriceatthetimeofgrantofthePSPawardon30November15was10.88p.4.FollowingtheterminationofMarkWood’sappointmentasChiefExecutivewitheffectfrom1April2014,theCommitteeexerciseditsdiscretiontowaivetherequirementforMarkWoodtoremainin

employmentonthevestingdateofthePSPawardsgrantedtohimduringhisappointmentasChiefExecutiveandtoallowaportionofthePSPawardsgrantedtohimon18January2012,17December2012and16December2013tovestasnormalon18January2015,17December2015and16December2016respectivelyonaproratabasis(subjecttotherelevantperformancecriteriabeingmet).Theremaining2,564,325optionsgrantedon18January2012lapsedon18January2015andtheremaining678,159optionsgrantedon17December2012lapsedon17December2015sincetherelevantperformancecriteriahadnotbeenmet.The156,022optionsgrantedon16December2013willlapseon16December2016,sincetherelevantperformancecriteriahavenotbeenmet.

Share incentives awarded during the year (audited)

PSP Grants

Date of award % salary Value (£)% vesting at min performance

No. shares awarded Performance period

ZillahByng-Thorne 30November2015 91% £272,000 25% 2,500,000 1October2015–30September2018

PennyLadkin-Brand 30November2015 78% £136,000 25% 1,250,000 1October2015–30September2018

Notes:1. ThevalueofthePSPawardsiscalculatedusingthesharepriceatthedateofgrant,whichwas10.88ppershare.2.ThePSPawardsareexercisableatnilvalue.3.Theperformanceconditionsattachedtothegrantoftheaboveawardsarethesameassetoutonpage31.4. Thepercentagevestingatminimumperformancerepresentsthe25%vestingoftheNetCashFlowelementandthe25%vestingoftheEPSelementoftheaward.

Company performance

TheperformancegraphoppositeshowstheTSRonaholdingofsharesintheCompanycomparedwiththeFTSEAllShareMediaIndex(UKcompanies).

ThefollowingisalistofthecompaniescurrentlyincludedintheFTSEAllShareMediaIndex(UKcompanies):

4 Imprint GroupAscentialAuto Trader GroupBloomsbury PublishingEntertainment One (DI)Euromoney Instl. InvestorGocompare.comInformaITE GroupITVMoneysupermarket.com GP

PearsonRELXRightmoveSTV GroupSkyTarsus GroupTrinity MirrorUBMWPPZoopla Property Group


orporate Governance

Graph: Past eight financial years ended 30 September 2016Total Shareholder Return: Rebased to Future plc as of 1 October 2008

Chief Executive pay during last eight years

year

Chief Executive single figure

£’000Bonus paid as %

of maximumShare based incentives

vesting as % of maximum

2009(StevieSpring) £423 0% 100%1

2010(StevieSpring) £746 40% 48%2

2011(StevieSpring) £546 0% 100%3

2012(MarkWood) £430 50% 0%4

2013(MarkWood) £331 0% 0%4

2014(ZillahByng-Thorne) £3066 20% 0%5



Notes:1. Thisrepresentsshareswhichweregrantedaspartofanexceptionalone-offawardintendedtoaidrecruitmentandretention.Theawardwasnotsubjecttoperformancecriteria.2. ThisrepresentsthefirsttrancheofadeferredbonusshareawardwhichwasnotsubjecttoperformancecriteriaandthePSPawardgrantedinDecember2006whichpartiallyvestedinDecember2009 followingthepartialsatisfactionofTSRperformancecriteria.3. Thisrepresentsthesecondtrancheofadeferredbonusshareawardwhichwasnotsubjecttoperformancecriteria.ThePSPawardgrantedinDecember2007lapsedinDecember2010.4. ThefirstawardsgrantedtoMarkWoodunderthePSPweregrantedinJanuary2012andlapsedon18January2015,sincetherelevantperformancecriteriawerenotmet.5. ThefirstawardsgrantedtoZillahByng-ThorneunderthePSPweregrantedinDecember2013andwilllapseon16December2016,sincetherelevantperformancecriteriawerenotmet.6. ThesinglefigureforZillahByng-Thornefor2014includesfivemonthsofherChiefFinancialOfficersalaryandsixmonthsofhersalaryasChiefExecutive.

Percentage change in remuneration of Chief Executive

Salary Benefits (inc pension) Bonus

2016 2015 % change 2016 2015 % change 2016 2015 % change

Chief Executive £300,000 £300,000 - £47,000 £47,000 - - £127,980 -100%All employees £38,491 £39,621 -2.9% £3,022 £2,931 +3.1% - £285 -100%

Future(rebasedto100) FTSEAll-ShareMediaIndex(UKcompanies)(rebasedto100)

50

100

150

200

250

300

350

2008 2009 2010 2011 2012 2013 2014 2015 2016

400



35 Future plc

Relative importance of spend on pay

Therelativeimportanceofthespendonpayforthebusinessisshowninthetablebelow.

2016£m

2015£m

Grouppay 24.0 26.6GroupoperatingcostsexcludingGrouppay&exceptionalcosts 34.3 33.3Capitalexpenditure 1.9 2.0Dividends - -

ThetableshowstheactualexpenditureoftheGroup,andchangebetweenthecurrentandpreviousyears,onremunerationpaidtoallemployeescomparedtothetotaloperatingcostsfortheGroupexcludingexceptionalcostsandremuneration,andinvestmentincapitalexpenditureanddividends.

Shareholder voting

AtthelastAnnualGeneralMeeting,votesontheDirectors’remunerationreportfortheyearended30September2015werecastasfollows:

For % Discretionary % Against % Abstain

ApprovalofDirectors’remunerationreportfor2015 295,309,192 99.93 28,498 0.01 177,997 0.06 2,200

Implementation of remuneration policy in the year to 30 September 2017

TheRemunerationCommitteeproposesthefollowingchangestotheimplementatonoftheremunerationpolicyfor2017,asoutlinedintheRemunerationpolicyreportonpages36to39,subjecttoshareholderapprovalattheCompany’sAGMon1February2017.

Element Operation of element Max. potential valuePerformance, weighting & time

Basesalary Nochange

ZillahByng-Thorne’ssalaryasChiefExecutiveincreasedto£350,000witheffectfrom21October2016.PennyLadkin-Brand’ssalaryasChiefFinancialOfficerincreasedto£250,000witheffectfrom1October2016.

Nochange

Benefits Nochange Nochange Nochange

AnnualBonus Nochange Nochange1A‘profitpool’stylebonusisproposedfor2017,withamaximumof45%ofsalaryforboththeChiefExecutiveandtheChiefFinancialOfficersubjecttotheachievementofcertainfinancialtargets.

PSP Nochange

TheCommitteerecommendsanincreaseinthemaximumvalueofaone-offawardinexceptionalcircumstancesfrom200%to400%ofbasicannualsalary.

TheCommitteeintendstoamendtheperformancetargetsforawardsmadein2017,inconsultationwithmajorshareholders.TheCommitteeproposesretainingtheweightingbutchangingtheperformancemetricsto50%basedonprofitperformanceand50%basedonsharepriceperformance.

Pension Nochange Nochange Nochange

Notes:1. PerformancetargetsfortheAnnualBonusfor2017arenotdisclosedduetotheircommercialsensitivity.

Advisers to the Remuneration Committee

ErnstandYoungLLPwasappointedduring2016bytheHRdirector,withtheconsentoftheCommittee,toadvisetheCommitteeinrespectofvariousshareincentiveissues.

Compliance with the UK Corporate Governance CodeTheBoardhascompliedfullywiththeprovisionsofSectionDoftheUKCorporateGovernanceCodeinrelationtoDirectors’remunerationpolicyandpractice,andhasfollowedScheduleAtotheCodeinrelationtoperformance-relatedremunerationpolicy.FurtherinformationregardingtheCompany’sapproachtocorporategovernanceissetoutonpages23to28.


Remuneration policy report

Corporate G

overnance

Thepolicysetoutbelowisintendedtoapplyforallfinancialyearsbeginningonorafter1October2016to30September2019,subjecttoshareholderapprovalattheCompany’sAnnualGeneralMeetingon1February2017andshalltakeeffectfollowingtheconclusionofthe2017AGM.

TheCommitteeconsiderstheremunerationpolicyannuallytoensurethatitremainsalignedwiththeGroup’sbusinessneedsandisappropriatelypositionedrelativetothemarket.However,thereisnointentiontoputthepolicyforwardtoshareholdersforapprovalmorefrequentlythaneverythreeyearsunlessanamendmentisproposed.

Approach to recruitment remuneration for executive and non-executive DirectorsTheCommittee’sobjectiveatthetimeofanappointmenttoanewroleistoweightexecutiveDirectors’remunerationpackagestowardsperformance-relatedpay,withperformance-relatedtargetslinkedtofinancialperformanceoftheGroupagainstbudgetandtheGroup’sperformanceagainstbusinessobjectivesanditsstatedstrategy.

AnynewexecutiveDirector’sremunerationpackagewouldincludethesameelementsasthoseoftheexistingexecutiveDirectors,asshowninthenextcolumn.

Element of remuneration Maximum % of salary

Salary Nothigherthanmarketvalue

Benefits Dependentoncircumstances

Pension 12.5%ofbasicannualsalary

Performance- relatedbonus2 150%

Shareincentiveschemes1 100%

Notes:1.PSPschemerulesprovideforawardsofupto100%ofbasicannualsalary,saveinexceptionalcircumstanceswheretheCommitteeisalloweddiscretiontoawardupto400%ofbasicannualsalary.

2.TheCommitteeretainsdiscretiontomakeone-offsignonpaymentsortograntawardsundertheshare-basedincentiveschemeofupto200%ofbasicannualsalarytotheextentthatitisnecessarytorecruitahighcalibreindividual,ortocompensatetheindividualforlossofbonusorotherincentiveawardsgrantedbythepreviousemployer.

3.Intheeventofaninternalpromotion,anycommitmentsmadebytheCompanytoaninternalcandidateshallbehonouredevenifitwouldotherwisebeinconsistentwiththepolicy.

4.IftheDirectorisrequiredtorelocatethenthepolicyistoprovidereasonablerelocation,travelandsubsistencepaymentsatthediscretionoftheCommittee.

Indeterminingthelevelandmake-upofexecutiveDirectors’remuneration,theCommitteecarefullyconsidersthefollowingissues:

(a)RemunerationpackagesofferedtoexecutiveDirectorsshouldbecompetitivewiththoseavailableforcomparablerolesincompaniesoperatinginsimilarmarketsandonasimilar

scale.Theyshouldbesufficientlydesirablesoastoattract,retainandmotivatehighcalibreDirectorstoperformatthehighestlevels,whilstatthesametimeensuringthatrecruitmentandremunerationexpenditureisnotexcessiveanddoesnotencourageexcessiverisk-taking.

(b)TheinterestsofexecutiveDirectorsshouldbealignedwiththoseofshareholdersbyensuringthatasignificantproportionofremunerationislinkedtoGroupperformance.

(c)RemunerationpackagesandemploymentconditionsofexecutiveDirectorsareconsideredinconjunctionwithboththoseofkeyseniormanagers(keepingsuccessionplanninginmind)andallemployeesintheGroupinordertoachieveaconsistentremunerationpolicyacrosstheGroup.TheCommitteehasgivenparticularattentiontoensuringthattheremunerationpackagesofthekeyseniormanagersrecruitedduringtheyeararealignedwiththoseoftheexecutiveDirectors.

(d)Bonuspotentialandshareschemeawardsthatarecappedatapercentageofsalaryarerestrictedifsalariesarelow.

(e)Subjectivecriteriaareappliedtoanelementoftheperformance-relatedbonusoftheChiefExecutiveandChiefFinancialOfficer(withafinancialunderpin)inordertoensurethattheCommitteeretainsdiscretionandtoensurenoperformance-relatedbonusisunjustlyreceived.

Service contracts and payments for loss of office

Executive Directors Contract provision Policy Details

Noticeperiods DirectororCompanyshallbeentitledtoserve6months’notice(inPennyLadkin-Brand’scase)or12months’notice(inZillahByng-Thorne’scase).

ADirectormayberequiredtoworkduringtheirnoticeperiodorbeputongardenleave.

Compensationforlossofoffice Directorshallbeentitledtoreceive6months’salary(inPennyLadkin-Brand’scase)or12months’salary(inZillahByng-Thorne’scase)andbenefitsduringanyunexpirednoticeperiod.

Whileserviceagreementsallowformonthlypaymentsduringnoticeperiodwhicharesubjecttomitigation,theCommitteeretainsdiscretiontomakepaymentsinsuchmannerasisdeemedappropriate,particularlybyreferencetothecircumstancesofthelossofoffice.

Treatmentofshareincentivesontermination

IncentiveswilllapseorvestattheCommittee’sdiscretion,subjecttoperformancecriteriabeingmetandtherulesofthescheme.

TheCommitteehasdiscretiontoallowawardstovestpartiallyorinfullontermination,ortopreserveawards.

Changeofcontrol Intheeventofachangeofcontrol,aDirector mayterminatetheirappointmentonservingnolessthan1month’snotice.

IntheeventofterminationbyeithertheDirectorortheCompany,theDirectorwillbeentitledtoreceive6months’salary.

Non-executive Directors

Noticeperiods 3months’noticefromeitherCompanyorDirector.

Appointedforathreeyearterm,subjecttoannualre-electionbyshareholdersattheCompany’sAGM.

CopiesofDirectors’serviceagreementsandlettersofappointmentareavailableforinspectiononrequestattheCompany’sregisteredoffice.



37 Future plc

Remuneration table

Executive Directors

Element Operation Objective & link to strategy Max. potential value Performance measures Changes for 2017Basic annual salary Basicannualsalaryispaidin12equalmonthlyinstalmentsduringtheyearandisreviewedannually.

Whenassessingthelevelofbasicannualsalary,theCommitteetakesintoaccountperformance,marketconditions,remunerationofequivalentroleswithincomparablecompanies,thesizeandscaleofthebusinessandpayintheGroupasawhole.

TheCommitteeretainsdiscretiontopayasalarysupplementtoanexecutiveDirectorforfulfillingtheroleofanotherhigherpaidexecutiveDirectorwhenthatexecutiveDirectorleavestheCompany.

Torecruit,retainandmotivateindividualsofhighcalibre,andreflecttheskills,experienceandcontributionoftherelevantDirector.

CurrentbasicannualsalaryofChiefExecutiveis£350,000andChiefFinancialOfficeris£250,000.Salaryincreasesshallgenerallyreflectmarketconditions,performanceoftheindividual,newchallengesoranewstrategicdirectionforthebusiness.Similarly,theCommitteemayapproveahigherbasicannualsalaryforanewlyappointedDirectorthantheoutgoingDirectorreceivedwhereitconsidersitnecessaryinordertorecruitanindividualofsufficientcalibrefortherole.

Notapplicable. BasicannualsalaryforZillahByng-Thorneincreasedto£350,000witheffectfrom21October2016(beingthecompletiondateoftheacquisitionofImaginePublishing)andforPennyLadkin-Brandincreasedto£250,000witheffectfrom1October2016asaresultofmarketbenchmarking.

Benefits CurrentbenefitsavailabletoexecutiveDirectorsarecarallowance,permanenthealthinsurance,healthcareandlifeassurance.AdditionalbenefitsmaybeofferedifapplicableandsubjecttothemaximumvalueofallbenefitsnotexceedingthemaximumpotentialvaluesetbytheCommittee.

Toensurebroadcompetitivenesswithmarketpractice. TheCompanyshallcontinuetoprovidebenefitstoexecutiveDirectorsatsimilarlevels;whereinsurancecoverisprovidedbytheCompany,thatcovershallbemaintainedatasimilarlevelandtheCompanyshallpaythethencurrentmarketratesforsuchcover.

Notapplicable. Nochange.

Pension TheCompanyshallmakeacontributionuptoamaximumpercentageofbasicannualsalary(currently12.5%fortheChiefExecutiveand6%fortheChiefFinancialOfficer).

Toensurebroadcompetitivenesswithmarketpractice. Totalcostannuallyshallnotexceed15%ofbasicannualsalary. Notapplicable. Nochange.

Performance- related bonus1

TargetsaresetannuallybytheCommittee,basedon(i)financialperformanceagainstbudgetand,attheCommittee’sdiscretion,(ii)individualsubjectiveperformancetargetswhicharedeterminedforeachexecutiveDirector.

TheCommitteeretainsdiscretiontosetthefinancialtargetsbasedontheperformanceduringthepreviousfinancialyearandthebudgetfortheforthcomingyear,andperformanceoftheindividualagainsttheirspecificsubjectiveperformancetargets.

DesignedtorewarddeliveryofshareholdervalueandimplementationoftheGroup’sstrategy.

ForboththeChiefExecutiveandChiefFinancialOfficertheCommitteeretainsdiscretiontovarythepotentialtotalmaximumbonus,theweightingofthevariableelementsandthestretchofthetargetsinordertoincentiviseorrecruitexecutiveDirectors,providedthatthetotalmaximumpotentialbonusforanyoneyearshallnotexceed150%ofbasicannualsalaryandthatthemaximumbonusshallonlybepayableforoverperformance.

Theperformancemeasures,relativeweightingsandtargetsaresetannuallybytheCommittee.DetailsofthemeasuresandtheirrelativeweightingsaredisclosedannuallyintheDirectors’remunerationreportwiththetargetsdisclosedprovidedtheyarenotdeemedtobecommerciallysensitive.TheCommitteeretainsdiscretiontoadjustthetargetsifeventsoccurwhichleadittoconcludethattheyarenolongerappropriate.

TheCommitteealsoretainsdiscretiontoadjusttheoutcomeoftheperformance-relatedbonusforanyperformancemeasureifitconsidersthattobeappropriate.

Nochange.

Long term share-based incentive2

AnnualawardstoexecutiveDirectorsofuptoamaximumof1xbasicannualsalary,withdiscretiontoawarduptoamaximumof4xbasicannualsalaryinexceptionalcircumstances,e.g.recruitmentofaDirectororto“buyout”awardsgrantedbyprioremployer.

TheschemerulesallowtheCommitteediscretiontochangetheperformancetargetsandtheCommitteeshallbeentitledtoexerciseitsdiscretiontochangeperformancecriteriatotheextentthatitreflectsmarketpracticeand/ortheCommitteeconsidersalternativeperformancetargetstobemoreappropriatetothebusiness.

Designedtorewarddeliveryofshareholdervalueinthemedium-to-longterm.

Valueofgrantasamaximumpercentageofsalaryis100%ofbasicannualsalary,howeverinexceptionalcircumstancestheCommitteeretainsdiscretiontograntone-offawardsofavalueupto400%ofbasicannualsalary.

TheperformancetargetsaresetannuallybytheCommitteeanddisclosedannuallyintheDirectors’remunerationreportprovidedtheyarenotdeemedtobecommerciallysensitive.

Awardsvestattheendofthethree-yearperformanceperiod,whentheCommitteewillassessperformanceagainstthetargetssetanddetermine,initsabsolutediscretion,theoveralllevelofvestingoftheaward.

Ahighermaximumforthevalueofone-offawardsinexceptionalcircumstancesunderthePlanof400%ofbasicannualsalaryisproposed.

TheCommitteeintendstomakeaone-offaward,intwotranches,totheexecutiveDirectorsatavalueof400%ofbasicannualsalary,subjecttoshareholderapprovalofthepolicyatthe2017AGM.Thefirsttranche,atavalueof200%ofsalary,wasawardedinNovember2016withthesecondtrancheofafurther200%ofsalarytobeawardedfollowingtheAGMinFebruary2017.

All-employee share plans TheCompanyoperatesaShareIncentivePlan(“SIP”)intheUKwhichqualifiesfortaxbenefits.

TheCommitteeretainsdiscretiontoallowexecutiveDirectorstoparticipateintheSIPonthesametermsasotheremployees.

Toencourageshareownershipbyemployeesandaligntheirinterestswiththoseoftheshareholders.

Themaximumparticipationlevelsforall-employeeshareplanswillbethelimitssetoutinUKtaxlegislation.



Element Operation Objective & link to strategy Max. potential value Performance measures Changes for 2017Fees1 Non-executiveDirectors’feesarereviewedeverythreeyearsandpaidin12monthlyinstalments.

Currentfeesweresetin2011.Reflectsthetimecommitmentandresponsibilitiesoftheroles. Chairman:£120,000

DeputyChairman:£65,000Othernon-executiveDirectors:£40,000Additionalfeespayable:ChairmanofCommittee:£5,000SeniorindependentDirector:£5,000MemberofCommittee:Nil

Notapplicable. Nochange,sincePeterAllen’sfeeasChairmanremainsat£95,000.

Notes to the table1. Feesarepaidatastandardannualratetoreflectthetime,commitmentandresponsibilitiesoftheroles,withadditionalfeespaidtothosewhochairBoardCommitteestoreflecttheiradditional

responsibilities.Separately,theBoardsetsthefeepayabletotheChairmanoftheBoard.AdditionalfeesforchairingaCommitteeapplyonlyonce,regardlessofthenumberofCommitteesofwhichanon-executiveDirectorisChairman.Non-executiveDirectorsarenotincludedinanyperformance-relatedbonus,shareincentiveschemesorpensionarrangements.

Notes to the table1. Performance-relatedbonustargets:TheperformancetargetsaredeterminedannuallybytheCommitteeandaredesignedtoalignexecutiveDirectors’interestswiththoseoftheCompany’s

shareholdersandtorewardgoodperformancebytheCompany.FinancialtargetsaresetbyreferencetotheCompany’sbudgetfortherelevantfinancialyear,andindividualperformancetargetsaresetbyreferencetotheCompany’sstrategyandgoalsfortherelevantfinancialyear.Thetargetsforthefinancialyearto30September2017arenotdisclosedhereduetotheircommercialsensitivity.

2. PSPperformancetargets:additionaldetailsoftheperformancecriteriaattachingtoPSPawardsgrantedtodatearesetoutonpage31.


orporate Governance

Remuneration table

Executive Directors

Element Operation Objective & link to strategy Max. potential value Performance measures Changes for 2017Basic annual salary Basicannualsalaryispaidin12equalmonthlyinstalmentsduringtheyearandisreviewedannually.

Whenassessingthelevelofbasicannualsalary,theCommitteetakesintoaccountperformance,marketconditions,remunerationofequivalentroleswithincomparablecompanies,thesizeandscaleofthebusinessandpayintheGroupasawhole.

TheCommitteeretainsdiscretiontopayasalarysupplementtoanexecutiveDirectorforfulfillingtheroleofanotherhigherpaidexecutiveDirectorwhenthatexecutiveDirectorleavestheCompany.

Torecruit,retainandmotivateindividualsofhighcalibre,andreflecttheskills,experienceandcontributionoftherelevantDirector.

CurrentbasicannualsalaryofChiefExecutiveis£350,000andChiefFinancialOfficeris£250,000.Salaryincreasesshallgenerallyreflectmarketconditions,performanceoftheindividual,newchallengesoranewstrategicdirectionforthebusiness.Similarly,theCommitteemayapproveahigherbasicannualsalaryforanewlyappointedDirectorthantheoutgoingDirectorreceivedwhereitconsidersitnecessaryinordertorecruitanindividualofsufficientcalibrefortherole.

Notapplicable. BasicannualsalaryforZillahByng-Thorneincreasedto£350,000witheffectfrom21October2016(beingthecompletiondateoftheacquisitionofImaginePublishing)andforPennyLadkin-Brandincreasedto£250,000witheffectfrom1October2016asaresultofmarketbenchmarking.

Benefits CurrentbenefitsavailabletoexecutiveDirectorsarecarallowance,permanenthealthinsurance,healthcareandlifeassurance.AdditionalbenefitsmaybeofferedifapplicableandsubjecttothemaximumvalueofallbenefitsnotexceedingthemaximumpotentialvaluesetbytheCommittee.

Toensurebroadcompetitivenesswithmarketpractice. TheCompanyshallcontinuetoprovidebenefitstoexecutiveDirectorsatsimilarlevels;whereinsurancecoverisprovidedbytheCompany,thatcovershallbemaintainedatasimilarlevelandtheCompanyshallpaythethencurrentmarketratesforsuchcover.


Pension TheCompanyshallmakeacontributionuptoamaximumpercentageofbasicannualsalary(currently12.5%fortheChiefExecutiveand6%fortheChiefFinancialOfficer).

Toensurebroadcompetitivenesswithmarketpractice. Totalcostannuallyshallnotexceed15%ofbasicannualsalary. Notapplicable. Nochange.

Performance- related bonus1

TargetsaresetannuallybytheCommittee,basedon(i)financialperformanceagainstbudgetand,attheCommittee’sdiscretion,(ii)individualsubjectiveperformancetargetswhicharedeterminedforeachexecutiveDirector.

TheCommitteeretainsdiscretiontosetthefinancialtargetsbasedontheperformanceduringthepreviousfinancialyearandthebudgetfortheforthcomingyear,andperformanceoftheindividualagainsttheirspecificsubjectiveperformancetargets.

DesignedtorewarddeliveryofshareholdervalueandimplementationoftheGroup’sstrategy.

ForboththeChiefExecutiveandChiefFinancialOfficertheCommitteeretainsdiscretiontovarythepotentialtotalmaximumbonus,theweightingofthevariableelementsandthestretchofthetargetsinordertoincentiviseorrecruitexecutiveDirectors,providedthatthetotalmaximumpotentialbonusforanyoneyearshallnotexceed150%ofbasicannualsalaryandthatthemaximumbonusshallonlybepayableforoverperformance.

Theperformancemeasures,relativeweightingsandtargetsaresetannuallybytheCommittee.DetailsofthemeasuresandtheirrelativeweightingsaredisclosedannuallyintheDirectors’remunerationreportwiththetargetsdisclosedprovidedtheyarenotdeemedtobecommerciallysensitive.TheCommitteeretainsdiscretiontoadjustthetargetsifeventsoccurwhichleadittoconcludethattheyarenolongerappropriate.

TheCommitteealsoretainsdiscretiontoadjusttheoutcomeoftheperformance-relatedbonusforanyperformancemeasureifitconsidersthattobeappropriate.

Nochange.

Long term share-based incentive2

AnnualawardstoexecutiveDirectorsofuptoamaximumof1xbasicannualsalary,withdiscretiontoawarduptoamaximumof4xbasicannualsalaryinexceptionalcircumstances,e.g.recruitmentofaDirectororto“buyout”awardsgrantedbyprioremployer.

TheschemerulesallowtheCommitteediscretiontochangetheperformancetargetsandtheCommitteeshallbeentitledtoexerciseitsdiscretiontochangeperformancecriteriatotheextentthatitreflectsmarketpracticeand/ortheCommitteeconsidersalternativeperformancetargetstobemoreappropriatetothebusiness.

Designedtorewarddeliveryofshareholdervalueinthemedium-to-longterm.

Valueofgrantasamaximumpercentageofsalaryis100%ofbasicannualsalary,howeverinexceptionalcircumstancestheCommitteeretainsdiscretiontograntone-offawardsofavalueupto400%ofbasicannualsalary.

TheperformancetargetsaresetannuallybytheCommitteeanddisclosedannuallyintheDirectors’remunerationreportprovidedtheyarenotdeemedtobecommerciallysensitive.

Awardsvestattheendofthethree-yearperformanceperiod,whentheCommitteewillassessperformanceagainstthetargetssetanddetermine,initsabsolutediscretion,theoveralllevelofvestingoftheaward.

Ahighermaximumforthevalueofone-offawardsinexceptionalcircumstancesunderthePlanof400%ofbasicannualsalaryisproposed.

TheCommitteeintendstomakeaone-offaward,intwotranches,totheexecutiveDirectorsatavalueof400%ofbasicannualsalary,subjecttoshareholderapprovalofthepolicyatthe2017AGM.Thefirsttranche,atavalueof200%ofsalary,wasawardedinNovember2016withthesecondtrancheofafurther200%ofsalarytobeawardedfollowingtheAGMinFebruary2017.

All-employee share plans TheCompanyoperatesaShareIncentivePlan(“SIP”)intheUKwhichqualifiesfortaxbenefits.

TheCommitteeretainsdiscretiontoallowexecutiveDirectorstoparticipateintheSIPonthesametermsasotheremployees.

Toencourageshareownershipbyemployeesandaligntheirinterestswiththoseoftheshareholders.

Themaximumparticipationlevelsforall-employeeshareplanswillbethelimitssetoutinUKtaxlegislation.



Element Operation Objective & link to strategy Max. potential value Performance measures Changes for 2017Fees1 Non-executiveDirectors’feesarereviewedeverythreeyearsandpaidin12monthlyinstalments.

Currentfeesweresetin2011.Reflectsthetimecommitmentandresponsibilitiesoftheroles. Chairman:£120,000

DeputyChairman:£65,000Othernon-executiveDirectors:£40,000Additionalfeespayable:ChairmanofCommittee:£5,000SeniorindependentDirector:£5,000MemberofCommittee:Nil

Notapplicable. Nochange,sincePeterAllen’sfeeasChairmanremainsat£95,000.

Notes to the table1. Feesarepaidatastandardannualratetoreflectthetime,commitmentandresponsibilitiesoftheroles,withadditionalfeespaidtothosewhochairBoardCommitteestoreflecttheiradditional

responsibilities.Separately,theBoardsetsthefeepayabletotheChairmanoftheBoard.AdditionalfeesforchairingaCommitteeapplyonlyonce,regardlessofthenumberofCommitteesofwhichanon-executiveDirectorisChairman.Non-executiveDirectorsarenotincludedinanyperformance-relatedbonus,shareincentiveschemesorpensionarrangements.

3. AllemployeesoftheGroupreceiveabasicannualsalary,benefits,pensionandannualbonus(subjecttofinancialperformance).Themaximumvalueofremunerationpackagesisbasedontheseniorityandresponsibilitiesoftherelevantrole.DiscretionaryshareincentivesarenotawardedtoemployeesotherthanexecutiveDirectorsandseniormanagers,howevertheCompanyintroducedaShareIncentivePlanin2015inordertoencourageactiveemployeeshareownership.

39 Future plc



Total remuneration scenarios

Consideration of employee conditions within the Group

TheCommitteetakesintoconsiderationthepayandconditionsofemployeesacrosstheGroupwhendeterminingremunerationforexecutiveDirectors.

Allemployeesreceiveabasicannualsalary,benefitsandanentitlementtoreceiveabonus,subjecttofinancialperformance,undertheGroup’sprofitimprovementscheme.

DiscretionaryshareincentiveawardsaregrantedtocertainseniormanagersunderthePSPandDABSschemes,thedetailsofwhicharesetoutatnote24onpage74.During2015theGroupintroducedaShareIncentivePlantoreplacetheSharesavescheme,inordertoencourageactiveemployeeshareownership.

Consideration of shareholder views

TheRemunerationCommitteeconsidersshareholderfeedbackreceivedaspartofanydiscussionswithshareholdersandconsultswithshareholdersonspecificmattersasandwhenappropriate.


Manjit WolstenholmeChairmanoftheRemunerationCommittee13December2016

Notes:1.Annualsalaryisbasedonbasicsalaryforthefinancialyearending30September2017.2.Thevalueofpensionisdeterminedasapercentageofsalary,basedonsalaryfor2017.Thevalueofbenefitsinkindiscalculatedonthebasisofthevaluefor2016.

3.Theremunerationscenariosaboveincludeatransactionbonus,amountingto100%ofbasicannualsalaryfortheChiefExecutiveand50%ofbasicannualsalaryfortheChiefFinancialOfficer,paidfollowingthesuccessfulcompletionoftheacquisitionofImaginePublishinginOctober2016.

4.On-targetperformancewoulddeliver50%ofthemaximumannualbonusfortheChiefExecutiveandtheChiefFinancialOfficer.Maximumperformancewouldresultinthemaximumannualbonuspaymentof45%ofbasicannualsalaryforboththeChiefExecutiveandtheChiefFinancialOfficer.

5.ThefinalyearoftheperformanceperiodinrespectofbothEPSandNetCashFlowtargetsforthePSPawardgrantedtoPennyLadkin-BrandinAugust2015istheyearending30September2017.On-targetperformanceassumesthat50%oftheawardswouldvestwhilemaximumperformancewouldresultin100%oftheawardsvesting.Thevalueofthesharesthatwouldvesthasbeencalculatedusingasharepriceof13.75ppersharebeingthelatestavailableshareprice.

Zillah Byng-Thorne

200

100

300

400

800

500

900

600

1,000

700

Minimum

46%

Target Maximum

44%

54% 48

%52

%

56%

£754,000

£833,000

£912,000

Minimum Target Maximum

Penny Ladkin-Brand

36%

68%

47%

33% 33

%£388,000

£557,000

£727,000

Salary,pension &benefits

Bonus

PSP

200

100

300

400

500

600

700

32%

20%

31%

800


orporate Governance

41 Future plc

Independent auditors’ report Independent auditors’ report to

the members of Future plc

Report on the financial statements

Our opinion

In our opinion:

• Futureplc’sGroupfinancialstatementsandCompanyfinancialstatements(the“financialstatements”)giveatrueandfairviewofthestateoftheGroup’sandoftheCompany’saffairsasat30September2016andoftheGroup’slossandtheGroup’sandtheCompany’scashflowsfortheyearthenended;

• theGroupfinancialstatementshavebeenproperlypreparedinaccordancewithInternationalFinancialReportingStandards(“IFRSs”)asadoptedbytheEuropeanUnion;

• theCompanyfinancialstatementshavebeenproperlypreparedinaccordancewithIFRSsasadoptedbytheEuropeanUnionandasappliedinaccordancewiththeprovisionsoftheCompaniesAct2006;and

• thefinancialstatementshavebeenpreparedinaccordancewiththerequirementsoftheCompaniesAct2006and,asregardstheGroupfinancialstatements,Article4oftheIASRegulation.

What we have audited

Thefinancialstatements,includedwithintheAnnualReportandAccounts(the“AnnualReport”),comprise:

• theConsolidatedbalancesheetandCompanybalancesheetasat30September2016;

• theConsolidatedincomestatementandConsolidatedstatementofcomprehensiveincomefortheyearthenended;

• theConsolidatedandCompanycashflowstatementsfortheyearthenended;

• theConsolidatedstatementofchangesinequityandtheCompanystatementofchangesinequityfortheyearthenended;

• theAccountingpolicies;and

• theNotestothefinancialstatements,whichincludeotherexplanatoryinformation.

ThefinancialreportingframeworkthathasbeenappliedinthepreparationofthefinancialstatementsisIFRSsasadoptedbytheEuropeanUnionand,asregardstheCompanyfinancialstatements,asappliedinaccordancewiththeprovisionsoftheCompaniesAct2006,andapplicablelaw.

Inapplyingthefinancialreportingframework,theDirectorshavemadeanumberofsubjectivejudgements,forexampleinrespectofsignificantaccountingestimates.Inmakingsuchestimates,theyhavemadeassumptionsandconsideredfutureevents.

Opinions on other matters prescribed by the Companies Act 2006

In our opinion:

• theinformationgivenintheStrategicReportandtheDirectors’reportforthefinancialyearforwhichthefinancialstatementsarepreparedisconsistentwiththefinancialstatements.

• thepartoftheDirectors’remunerationreporttobeauditedhasbeenproperlypreparedinaccordancewiththeCompaniesAct2006.

Other matters on which we are required to report by exception

Adequacy of accounting records and information and explanations received

UndertheCompaniesAct2006wearerequiredtoreporttoyouif,inouropinion:

• wehavenotreceivedalltheinformationandexplanationswerequireforouraudit;or

• adequateaccountingrecordshavenotbeenkeptbytheCompany,orreturnsadequateforouraudithavenotbeenreceivedfrombranchesnotvisitedbyus;or

• theCompanyfinancialstatementsandthepartoftheDirectors’remunerationreporttobeauditedarenotinagreementwiththeaccountingrecordsandreturns.

Wehavenoexceptionstoreportarisingfromthisresponsibility.


Directors’ remuneration

UndertheCompaniesAct2006wearerequiredtoreporttoyouif,inouropinion,certaindisclosuresofDirectors’remunerationspecifiedbylawarenotmade.Wehavenoexceptionstoreportarisingfromthisresponsibility.

Responsibilities for the financial statements and the audit

Our responsibilities and those of the Directors

AsexplainedmorefullyintheStatementofDirectors’responsibilitiessetoutonpage22,theDirectorsareresponsibleforthepreparationofthefinancialstatementsandforbeingsatisfiedthattheygiveatrueandfairview.

OurresponsibilityistoauditandexpressanopiniononthefinancialstatementsinaccordancewithapplicablelawandInternationalStandardsonAuditing(UKandIreland)(“ISAs(UK&Ireland)”).ThosestandardsrequireustocomplywiththeAuditingPracticesBoard’sEthicalStandardsforAuditors.

Thisreport,includingtheopinions,hasbeenpreparedforandonlyfortheCompany’smembersasabodyinaccordancewithChapter3ofPart16oftheCompaniesAct2006andfornootherpurpose.Wedonot,ingivingtheseopinions,acceptorassumeresponsibilityforanyotherpurposeortoanyotherpersontowhomthisreportisshownorintowhosehandsitmaycomesavewhereexpresslyagreedbyourpriorconsentinwriting.

What an audit of financial statements involves

WeconductedourauditinaccordancewithISAs(UK&Ireland).Anauditinvolvesobtainingevidenceabouttheamountsanddisclosuresinthefinancialstatementssufficienttogivereasonableassurancethatthefinancialstatementsarefreefrommaterialmisstatement,whethercausedbyfraudorerror.Thisincludesanassessmentof:

• whethertheaccountingpoliciesareappropriatetotheGroup’sandtheCompany’scircumstancesandhavebeenconsistentlyappliedandadequatelydisclosed;

• thereasonablenessofsignificantaccountingestimatesmadebytheDirectors;and

• theoverallpresentationofthefinancialstatements.

WeprimarilyfocusourworkintheseareasbyassessingtheDirectors’judgementsagainstavailableevidence,formingourownjudgements,andevaluatingthedisclosuresinthefinancialstatements.

Wetestandexamineinformation,usingsamplingandotherauditingtechniques,totheextentweconsidernecessarytoprovideareasonablebasisforustodrawconclusions.Weobtainauditevidencethroughtestingtheeffectivenessofcontrols,substantiveproceduresoracombinationofboth.

Inaddition,wereadallthefinancialandnon-financialinformationintheAnnualReporttoidentifymaterialinconsistencieswiththeauditedfinancialstatementsandtoidentifyanyinformationthatisapparentlymateriallyincorrectbasedon,ormateriallyinconsistentwith,theknowledgeacquiredbyusinthecourseofperformingtheaudit.Ifwebecomeawareofanyapparentmaterialmisstatementsorinconsistenciesweconsidertheimplicationsforourreport.

ColinBates(SeniorStatutoryAuditor)forandonbehalfofPricewaterhouseCoopersLLPCharteredAccountantsandStatutoryAuditorsBristol13December2016

Corporate G

overnance

43

Contents

Consolidatedincomestatement 44

Consolidatedstatementof 44comprehensiveincome

Consolidatedstatementof 45changesinequity Companystatementof 45changesinequity

Consolidatedbalancesheet 46

Companybalancesheet 47

ConsolidatedandCompanycashflowstatements 48

NotestotheConsolidatedandCompanycashflowstatements 49

Accountingpolicies 50

Notestothefinancialstatements 54

Financial statementsFuture plc

Financial statements

44

Consolidated income statement fortheyearended30September2016

Note2016

£m2015£m

Continuing operationsRevenue 1 59.0 59.8

Operating profit before depreciation, amortisation, exceptional items and impairment of intangible assets 1 4.7 3.6

Depreciation 11 (0.4) (0.5)Amortisation 12 (2.0) (2.3)Exceptionalitems 4 (3.5) (2.5)Impairmentofintangibleassets 2 (13.0) -

Operating loss 2 (14.2) (1.7)Financecosts 6 (0.7) (0.6)Net finance costs 6 (0.7) (0.6)Loss before tax 1 (14.9) (2.3)Taxonloss 7 0.5 0.3Loss for the year from continuing operations (14.4) (2.0)Discontinued operationsProfitfortheyearfromdiscontinuedoperations 10 0.2 0.7Loss for the year attributable to owners of the parent (14.2) (1.3)

Earnings per 1p Ordinary share

Note2016

pence2015

pence

Basiclosspershare–TotalGroup 9 (3.9) (0.4)Dilutedlosspershare–TotalGroup 9 (3.9) (0.4)Basiclosspershare–Continuingoperations 9 (4.0) (0.6)Dilutedlosspershare–Continuingoperations 9 (4.0) (0.6)

AspermittedbytheexemptionunderSection408oftheCompaniesAct2006noCompanyincomestatementorstatementofcomprehensiveincomeispresented.

Consolidated statement of comprehensive incomefortheyearended30September2016

2016£m

2015£m

Loss for the year (14.2) (1.3)Items that may be reclassified to the consolidated income statementContinuing operationsCurrencytranslationdifferences 0.3 -Other comprehensive income for the year from continuing operations 0.3 -

Total comprehensive loss for the year attributable to continuing operations (14.1) (2.0)Total comprehensive income for the year attributable to discontinued operations 0.2 0.7Total comprehensive loss for the year attributable to owners of the parent (13.9) (1.3)

Itemsinthestatementabovearedisclosednetoftax.


AnnualReportandAccounts2016

Consolidated statement of changes in equity fortheyearended30September2016

Group Note

Issuedshare

capital£m

Share premium account

£m

Merger reserve

£m

Treasury reserve

£m

Accumulated losses

£m

Total equity

£m

Balance at 1 October 2014 3.3 24.8 109.0 (0.3) (104.2) 32.6Loss for the year - - - - (1.3) (1.3)Currencytranslationdifferences - - - - - -Other comprehensive income for the year - - - - - -Total comprehensive loss for the year - - - - (1.3) (1.3)Shareschemes-Valueofemployees’services 5 - - - - 0.1 0.1Balance at 30 September 2015 3.3 24.8 109.0 (0.3) (105.4) 31.4Loss for the year - - - - (14.2) (14.2)Currencytranslationdifferences - - - - 0.3 0.3Other comprehensive income for the year - - - - 0.3 0.3Total comprehensive loss for the year - - - - (13.9) (13.9)Sharecapitalissuedduringtheyear 0.4 2.8 - - - 3.2Shareschemes-Valueofemployees’services 5 - - - - 0.5 0.5Balance at 30 September 2016 3.7 27.6 109.0 (0.3) (118.8) 21.2

Company statement of changes in equity fortheyearended30September2016

Company Note

Issuedshare

capital£m

Share premium account

£m

Retained earnings

£m

Total equity

£m

Balance at 1 October 2014 3.3 24.8 10.7 38.8Loss for the year - - (0.9) (0.9)Other comprehensive income for the year - - - -Total comprehensive loss for the year - - (0.9) (0.9)Shareschemes-Valueofemployees’services 5 - - 0.1 0.1Balance at 30 September 2015 3.3 24.8 9.9 38.0Loss for the year - - (6.4) (6.4)Other comprehensive income for the year - - - -Total comprehensive loss for the year - - (6.4) (6.4)Sharecapitalissuedduringtheyear 0.4 2.8 - 3.2Shareschemes-Valueofemployees’services 5 - - 0.5 0.5Balance at 30 September 2016 3.7 27.6 4.0 35.3


45 Future plc


Consolidated balance sheetasat30September2016

Note2016

£m2015£m

AssetsNon-current assetsProperty,plantandequipment 11 0.5 0.6Intangibleassets-goodwill 12 29.5 40.9Intangibleassets-other 12 3.7 2.9Deferredtax 14 2.4 0.5Total non-current assets 36.1 44.9Current assetsInventories 15 0.4 0.5Corporationtaxrecoverable 0.1 1.2Tradeandotherreceivables 16 12.4 15.3Cashandcashequivalents 17 2.9 2.5Total current assets 15.8 19.5Total assets 51.9 64.4Equity and liabilitiesEquityIssuedsharecapital 23 3.7 3.3Sharepremiumaccount 27.6 24.8Mergerreserve 25 109.0 109.0Treasuryreserve 25 (0.3) (0.3)Accumulatedlosses (118.8) (105.4)Total equity 21.2 31.4Non-current liabilitiesFinancialliabilities-interest-bearingloansandborrowings 19 0.1 -Corporationtaxpayable 7 2.6 3.5Deferredtax 14 0.9 0.7Provisions 20 1.5 2.1Othernon-currentliabilities 21 0.5 0.8Total non-current liabilities 5.6 7.1Current liabilitiesFinancialliabilities-interest-bearingloansandborrowings 19 2.3 4.3Tradeandotherpayables 18 21.4 20.7Corporationtaxpayable 7 1.4 0.9Total current liabilities 25.1 25.9Total liabilities 30.7 33.0Total equity and liabilities 51.9 64.4

Thefinancialstatementsonpages43to78wereapprovedbytheBoardofDirectorson13December2016andsignedonitsbehalfby:

Peter Allen Penny Ladkin-BrandChairman ChiefFinancialOfficer


Company balance sheetasat30September2016

Note2016

£m2015£m

AssetsNon-current assetsInvestmentinGroupundertakings 13 1.0 131.9Total non-current assets 1.0 131.9Current assetsTradeandotherreceivables 16 43.5 46.7Total current assets 43.5 46.7Total assets 44.5 178.6Equity and liabilitiesEquityIssuedsharecapital 23 3.7 3.3Sharepremiumaccount 27.6 24.8Retainedearnings 4.0 9.9Total equity 35.3 38.0Non-current liabilitiesCorporationtaxpayable 7 2.6 3.5Total non-current liabilities 2.6 3.5Current liabilitiesFinancialliabilities-interest-bearingloansandborrowings 19 2.3 4.3Financialliabilities-non-interest-bearingoverdraft 19 1.0 7.9Tradeandotherpayables 18 2.4 124.0Corporationtaxpayable 7 0.9 0.9Total current liabilities 6.6 137.1Total liabilities 9.2 140.6Total equity and liabilities 44.5 178.6

Thefinancialstatementsonpages43to78wereapprovedbytheBoardofDirectorson13December2016andsignedonitsbehalfby:

Peter Allen Penny Ladkin-BrandChairman ChiefFinancialOfficer

FutureplcCompanyregistrationnumber:3757874


47 Future plc

Consolidated and Company cash flow statementsfortheyearended30September2016

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

Cash flows from operating activitiesCashgeneratedfrom/(usedin)operations 3.1 (1.4) (7.5) (0.5)Taxreceived 0.1 - 0.5 -Interestpaid (0.4) (0.4) (0.6) (0.5)Taxpaid (0.8) (0.7) (1.0) (0.7)Net cash generated from/(used in) operating activities 2.0 (2.5) (8.6) (1.7)Cash flows from investing activitiesPurchaseofproperty,plantandequipment (0.2) - (0.2) -Purchaseofcomputersoftwareandwebsitedevelopment (1.7) - (1.8) -Purchaseofmagazinetitlesandevents (0.6) - - -Purchaseofsubsidiaryundertakings,netofcashacquired (0.3) - - -Disposalofproperty,plantandequipment - - 1.2 -Disposalofmagazinetitlesandtrademarks - - 0.1 -Netmovementinamountsowedto/bysubsidiaries - 8.3 - (1.8)Net cash (used in)/generated from investing activities (2.8) 8.3 (0.7) (1.8)Cash flows from financing activitiesProceedsfromissueofOrdinarysharecapital 3.3 3.3 - -Costsofshareissue (0.2) (0.2) - -Drawdownofbankloans 4.6 4.6 3.5 3.5Repaymentofbankloans (5.7) (5.7) - -Bankarrangementfees - - (0.2) (0.2)Repaymentoffinanceleases (0.1) - - -Net cash generated from financing activities 1.9 2.0 3.3 3.3Net increase/(decrease) in cash and cash equivalents 1.1 7.8 (6.0) (0.2)Cashandcashequivalentsatbeginningofyear 1.6 (8.8) 7.5 (8.6)Exchangeadjustments 0.2 - 0.1 -Cash and cash equivalents at end of year 2.9 (1.0) 1.6 (8.8)Amountattributabletocontinuingoperations 2.9 (1.0) 1.6 (8.8)



Notes to the Consolidated and Company cash flow statementsfortheyearended30September2016

A. Cash used in operationsThereconciliationof(loss)/profitfortheyeartocashgeneratedfrom/(usedin)operationsissetoutbelow:

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

(Loss)/profitfortheyear–Continuingoperations (14.4) (6.4) (2.0) (0.9)–Discontinuedoperations 0.2 - 0.7 -Lossfortheyear–TotalGroup (14.2) (6.4) (1.3) (0.9)Adjustmentsfor: Depreciationcharge 0.4 - 0.5 -Amortisationofintangibleassets 2.0 - 2.3 -Impairmentofintangibleassets 13.0 - - -Profitondisposalofmagazinetitlesandtrademarks (0.4) - (0.1) -Profitondisposalofproperty,plantandequipment - - (0.3) -Shareschemes-Valueofemployees’services 0.5 - 0.1 -ImpairmentofinvestmentinGroupundertakings - 131.4 - 0.1DividendreceivablefromGroupundertaking - (130.9) - -Netfinancecosts 0.7 2.9 0.6 1.5Tax(credit)/charge (0.5) 0.1 (0.4) (1.2)Profit/(loss) before changes in working capital and provisions 1.5 (2.9) 1.4 (0.5)Movementinprovisions (0.6) - (0.7) -Decreaseininventories 0.1 - 0.1 -Decrease/(increase)intradeandotherreceivables 3.8 (0.1) (2.8) -(Decrease)/increaseintradeandotherpayables (1.7) 1.6 (5.5) -Cash generated from/(used in) operations 3.1 (1.4) (7.5) (0.5)

B. Analysis of net (debt)/cash

Group

1 October 2015

£mCash flows

£m

Finance leases entered into

£m

Exchange movements

£m

30 September 2016

£m

Cashandcashequivalents 1.6 1.1 - 0.2 2.9Debtduewithinoneyear (3.4) 1.2 (0.1) - (2.3)Debtdueaftermorethanoneyear - - (0.1) - (0.1)Net (debt)/cash (1.8) 2.3 (0.2) 0.2 0.5

Company

1 October 2015

£mCash flows

£m

Other non-cash changes

£m

30 September 2016

£m

Cashandcashequivalents (8.8) 7.8 - (1.0)Debtduewithinoneyear (3.4) 1.1 - (2.3)Net debt (12.2) 8.9 - (3.3)

C. Reconciliation of movement in net (debt)/cash

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

Net(debt)/cashatstartofyear (1.8) (12.2) 7.5 (8.6)Increase/(decrease)incashandcashequivalents 1.1 7.8 (6.0) (0.2)Movementinborrowings 1.2 1.1 (3.5) (3.5)Financeleasesenteredinto (0.2) - - -Othernon-cashchanges - - 0.1 0.1Exchangemovements 0.2 - 0.1 -Net cash/(debt) at end of year 0.5 (3.3) (1.8) (12.2)


49 Future plc

Basis of preparation

Thesefinancialstatementshavebeenpreparedunderthehistoricalcostconvention,exceptforderivativefinancialinstrumentsandshareawardswhicharestatedatfairvalue.

Theprincipalaccountingpoliciesappliedinthepreparationoftheconsolidatedfinancialstatementspublishedinthis2016AnnualReportaresetoutonpages50to53.Thesepolicieshavebeenappliedconsistentlytoallyearspresented,unlessotherwisestated.

ThefinancialstatementsoftheGrouphavebeenpreparedinaccordancewithInternationalFinancialReportingStandards(IFRS)issuedbytheInternationalAccountingStandardsBoard(IASB)andtheInternationalFinancialReportingInterpretationsCommittee’s(IFRIC)interpretationsasadoptedbytheEuropeanUnion,applicableasat30September2016,andthosepartsoftheCompaniesAct2006applicabletocompaniesreportingunderIFRS.

ThegoingconcernbasishasbeenadoptedinpreparingthesefinancialstatementsasstatedbytheDirectorsonpage25.

Discontinued operations and non-current assets held for sale

During2014theSport,CraftandAutoportfoliosweredisposedof.InaccordancewithIFRS5theresultsoftheseoperationsarepresentedasdiscontinuedoperationsintheConsolidatedincomestatement.

WheretheGroupexpectstorecoverthecarryingamountofagroupofassetsthroughasaletransactionratherthanthroughcontinuinguse,theassetsareavailableforimmediatesaleintheirpresentcondition,managementiscommittedtothesaleandasaleishighlyprobableatthebalancesheetdate,theassetsareclassifiedasheldforsale.

Afterclassificationasheldforsale,theassetsaremeasuredatthelowerofthecarryingamountandfairvaluelesscoststosell.Animpairmentlossisrecognisedintheincomestatementforanywrite-downoftheassetstofairvaluelesscoststosell.Againforanysubsequentincreaseinfairvaluelesscoststosellisrecognisedintheincomestatementtotheextentthatitdoesnotexceedthecumulativeimpairmentlosspreviouslyrecognised.Nodepreciationoramortisationischargedinrespectofnon-currentassetsclassifiedasheldforsale.

Ifthegroupofassetsconstitutesaseparatemajorlineofbusinessitisclassifiedasadiscontinuedoperation.

Basis of consolidation

TheconsolidatedfinancialstatementsincorporatethefinancialstatementsofFutureplc(theCompany)anditssubsidiaryundertakings.SubsidiariesareallentitiesoverwhichtheGrouphasthepowertogovernthefinancialandoperatingpolicies,generallyaccompanyingashareholdingofmorethanonehalfofthevotingrights.Theexistenceandeffectofpotentialvotingrightsthatarecurrentlyexercisableorconvertibleareconsideredwhenassessingwhetherthe

Groupcontrolsanotherentity.SubsidiariesarefullyconsolidatedfromthedateonwhichcontrolistransferredtotheGroup.Theyaredeconsolidatedfromthedatethatcontrolceases.ThepurchasemethodofaccountingisusedtoaccountfortheacquisitionofsubsidiariesbytheGroup.

Thecostofanacquisitionismeasuredasthefairvalueoftheassetsgiven,equityinstrumentsissuedandliabilitiesincurredorassumedatthedateofexchange,andincludesthefairvalueofanyassetorliabilityresultingfromacontingentconsiderationarrangement.Acquisition-relatedcostsareexpensedasincurred.Identifiableassetsacquiredandliabilitiesandcontingentliabilitiesassumedinabusinesscombinationaremeasuredinitiallyattheirfairvaluesattheacquisitiondate.TheexcessofthecostofacquisitionoverthefairvalueoftheGroup’sshareoftheidentifiablenetassetsacquiredisrecordedasgoodwill.

Inter-companytransactions,balancesandunrealisedgainsontransactionsbetweenGroupcompaniesareeliminated.Unrealisedlossesarealsoeliminatedbutareconsideredanimpairmentindicatoroftheassettransferred.AccountingpoliciesofsubsidiarieshavebeenchangedwherenecessarytoensureconsistencywiththepoliciesadoptedbytheGroup.

Segment reporting

TheGroupisorganisedandarrangedprimarilybygeographicalsegment.OperatingsegmentsarereportedinamannerconsistentwiththeinternalreportingprovidedtotheChiefOperatingDecisionMakerswhoareconsideredtobetheexecutiveDirectorsofFutureplc.

Revenue recognition

Revenuefromthesaleofgoodsisrecognisedintheincomestatementwhenthesignificantrisksandrewardsofownershiphavebeen

transferredtothebuyer.Revenuefromservicesrenderedisrecognisedinthe incomestatementoncetheservicehas beencompleted.

RevenuecomprisesthefairvalueoftheconsiderationreceivedorreceivableforthesaleofgoodsandservicesintheordinarycourseoftheGroup’sactivities.Revenueisshownnetofvalue-addedtax,estimatedreturns,rebatesanddiscountsandaftereliminatingsaleswithintheGroup.Thefollowingrecognitioncriteriaalsoapply:

• Magazinenewsstandcirculationandadvertisingrevenueisrecognisedaccordingtothedatethattherelatedpublicationgoesonsale.

• Revenuefromthesaleofdigitalmagazinesubscriptionsisrecogniseduniformlyoverthetermofthesubscription.

• Eventincomeisrecognisedwhentheeventhastakenplace.

• Licensingrevenueisrecognisedonthesupplyofthelicensedcontent.

• Otherrevenueisrecognisedatthetimeofsaleorprovisionofservice.

Foreign currency translation

(a) Functional and presentation currencyItemsincludedinthefinancialstatementsofeachoftheGroup’sentitiesaremeasuredusingthecurrencyoftheprimaryeconomicenvironmentinwhichtheentityoperates(‘thefunctionalcurrency’).Theconsolidatedfinancialstatementsarepresentedinsterling,whichistheGroup’spresentationcurrency.

(b) Transactions and balancesForeigncurrencytransactionsaretranslatedintothefunctionalcurrencyusingtheexchangerateprevailingatthedateofthetransaction.Foreignexchangegainsandlossesresultingfromthesettlementofsuchtransactions

Accounting policies



andfromthetranslationatbalancesheetexchangeratesofmonetaryassetsandliabilitiesdenominatedinforeigncurrenciesarerecognisedintheincomestatement,withexchangedifferencesarisingontradingtransactionsbeingreportedinoperatingprofitandwiththosearisingonfinancingtransactionsreportedinnetfinancecostsunless,asaresultofcashflowhedging,theyarereportedinothercomprehensiveincome.

(c) Group companiesTheresultsandfinancialpositionofalltheGroupentitiesthathaveafunctionalcurrencydifferentfromthepresentationcurrencyaretranslatedintothepresentationcurrencyasfollows:

(i) Assetsandliabilitiesforeachbalancesheetaretranslatedattheclosingrateatthedateofthatbalancesheet.

(ii) Incomeandexpensesforeachincomestatementaretranslatedataverageexchangerates.

(iii)Allresultingexchangedifferencesarerecognisedasaseparatecomponent ofequity.

Onconsolidation,exchangedifferences arisingfromthetranslationofthenetinvestmentinforeignoperations,andofborrowingsandothercurrencyinstrumentsdesignatedashedgesofsuchinvestments,aretakentoshareholders’equity.Whenaforeignoperationissold,exchangedifferencesthatwererecordedinequityarerecognisedintheincomestatementaspartofthegainorlossonsale.

Employee benefits

(a) Pension obligationsTheGrouphasanumberofdefinedcontributionplans.FordefinedcontributionplanstheGrouppayscontributionsintoaprivatelyadministeredpensionplanonacontractualorvoluntarybasis.TheGrouphasnofurtherpaymentobligationsoncethecontributionshavebeenpaid.Contributionsarechargedtotheincomestatementastheyareincurred.

(b) Share-based compensationTheGroupoperatesanumberofequity-settled,share-basedcompensationplans. Thefairvalueoftheemployeeservicesreceivedinexchangeforthegrantoftheawardsisrecognisedasanexpense.Thetotalamounttobeexpensedovertheappropriateserviceperiodisdeterminedbyreferencetothefairvalueoftheawards.Thecalculationoffairvalueincludesassumptionsregardingthenumberofcancellationsandexcludestheimpactofanynon-marketvestingconditions(forexample,earningspershare).Non-marketvestingconditionsareincludedinassumptionsaboutthenumberofawardsthatareexpectedtovest.Ateachbalancesheetdate,theGrouprevisesitsestimatesofthenumberofawardsthatareexpectedtovest.Itrecognisestheimpactoftherevisionoforiginalestimates,ifany,intheincomestatement,withacorrespondingadjustmenttoequity.

ThegrantbytheCompanyofshareawardstotheemployeesofsubsidiaryundertakingsistreatedasacapitalcontribution.Thefairvalueofemployeeservicesreceived,measuredbyreferencetothegrantdatefairvalue,isrecognisedoverthevestingperiodasanincreasetoinvestmentinsubsidiaryundertakings,withacorrespondingcredittoequityintheCompany’sfinancialstatements.

SharesintheCompanyareheldintrusttosatisfytheexerciseofawardsundercertain oftheGroup’sshare-basedcompensationplansandexceptionalawards.ThetrustisconsolidatedwithintheGroupfinancialstatements.Thesesharesarepresented intheconsolidatedbalancesheetasa deductionfromequityatthemarketvalue onthedateofacquisition.

(c) Bonus plansTheGrouprecognisesaliabilityandanexpenseforbonusestakingintoconsiderationtheprofitattributabletotheCompany’sshareholdersaftercertainadjustments.TheGrouprecognisesaprovisionwherecontractuallyobligedorwherethereisapastpracticethathascreatedaconstructiveobligation.

Leases

LeasesinwhichtheGroupassumessubstantiallyalltherisksandrewardsofownershipoftheleasedassetsareclassifiedasfinanceleases.Allotherleasesareclassedasoperatingleases.

Assetsheldunderfinanceleasesareincludedeitherasproperty,plantandequipmentorintangibleassetsattheloweroftheirfairvalueatinceptionorthepresentvalueoftheminimumleasepaymentsandaredepreciatedovertheirestimatedeconomiclivesorthefinanceleaseperiod,whicheveristheshorter.Thecorrespondingliabilityisrecordedwithinborrowings.Theinterestelementoftherentalcostsischargedagainstprofitsovertheperiodoftheleaseusingtheactuarialmethod.

Paymentsmadeunderoperatingleases(netofanyincentivesreceivedfromthelessor)arechargedtotheincomestatementonastraight-linebasisovertheperiodofthelease.

Tax

Taxontheprofitorlossfortheyearcomprisescurrenttaxanddeferredtax.Taxisrecognisedintheincomestatementexcepttotheextentthatitrelatestoitemsrecogniseddirectlyinequityinwhichcaseitisrecognisedinequity.

Currenttaxispayablebasedontaxableprofitsfortheyear,usingtaxratesthathavebeenenactedorsubstantivelyenactedatthebalancesheetdate,alongwithanyadjustmentrelatingtotaxpayableinpreviousyears.Managementperiodicallyevaluatesitemsdetailedintaxreturnswherethetaxtreatmentissubjecttointerpretation.Taxableprofitdiffersfromnetprofitintheincomestatementinthatincomeorexpenseitemsthataretaxableordeductibleinotheryearsare

excluded–asareitemsthatarenevertaxableordeductible.Currenttaxassetsrelatetopaymentsonaccountnotoffsetagainstcurrenttaxliabilities.

Deferredtaxisprovidedinfull,usingtheliabilitymethod,ontemporarydifferencesarisingbetweenthetaxbasesofassetsandliabilitiesandtheircarryingamountsintheconsolidatedfinancialstatements.However,deferredtaxisnotaccountedforifitarisesfrominitialrecognitionofanassetorliabilityinatransactionotherthanabusinesscombinationthatatthetimeofthetransactionaffectsneitheraccountingnortaxableprofitorloss.Deferredtaxisdeterminedusingtaxrates(andlaws)thathavebeenenactedorsubstantivelyenactedbythebalancesheetdateandareexpectedtoapplywhentherelateddeferredtaxassetisrealisedorthedeferredtaxliabilityissettledintheappropriateterritory.

Deferredtaxassetsarerecognisedtotheextentthatitisprobablethatfuturetaxableprofitswillbeavailableagainstwhichthetemporarydifferencescanbeutilised.Deferredtaxisprovidedontemporarydifferencesarisingoninvestmentsinsubsidiaries,exceptwherethetimingofthereversalofthetemporarydifferenceiscontrolledbytheGroupanditisprobable thatthetemporarydifferencewillnotreverse intheforeseeablefuture.

Deferredtaxassetsandliabilitiesareoffsetagainsteachotherwheretheyrelatetothesamejurisdictionandthereisalegallyenforceablerighttooffset.

Dividends

AlldividenddistributionstotheCompany’sshareholdersarerecognisedasaliabilityinthefinancialstatementsintheperiodinwhichtheyareapproved.

Property, plant and equipment

Property,plantandequipmentisstatedatcost(ordeemedcost)lessaccumulateddepreciationandimpairmentlosses.Costincludesexpenditurethatisdirectlyattributabletotheacquisitionoftheitems.

Depreciation

Depreciationiscalculatedusingthestraight-linemethodtoallocatethecostofproperty,plantandequipmentlessresidualvalueoverestimatedusefullives,asfollows:

• Landandbuildings–50yearsorperiodoftheleaseifshorter.

• Plantandmachinery–betweenoneand fiveyears.

• Equipment,fixturesandfittings–betweenoneandfiveyears.

Theassets’residualvaluesandusefullivesarereviewed,andadjustedifappropriate,


51 Future plc

ateachbalancesheetdate.Anasset’scarryingamountiswrittendownimmediatelytoitsrecoverableamountiftheasset’scarryingamountisgreaterthanitsestimatedrecoverableamount.

Gainsandlossesondisposalsaredeterminedbycomparingproceedswithcarryingamounts.Theseareincludedintheincomestatement.

Intangible assets

(a) GoodwillInrespectofbusinesscombinationsthathaveoccurredsince1October2004,goodwillrepresentsthedifferencebetweenthecostoftheacquisitionandthefairvalueofnetidentifiableassetsacquired.Inrespectofbusinesscombinationspriortothisdate,goodwillisincludedonthebasisofitsdeemedcost,whichrepresentstheamountrecordedunderpreviousGAAP.

Goodwillisstatedatcostlessany accumulatedimpairmentlosses.Goodwill isallocatedtoappropriatecashgeneratingunits(thoseexpectedtobenefitfromthebusinesscombination)anditisnotsubjecttoamortisationbutistestedannuallyforimpairment.

(b) Titles, trademarks, customer lists, advertising relationships, e-commerce technology and other ‘magazine and website related’ intangiblesMagazine-relatedintangibleassetshaveafiniteusefullifeandarestatedatcostlessaccumulatedamortisation.Assetsacquiredaspartofabusinesscombinationareinitiallystatedatfairvalue.Amortisationiscalculatedusingthestraight-linemethodtoallocatethecostoftheseintangiblesovertheirestimatedusefullives(betweenoneandfifteenyears).

Expenditureincurredonthelaunchofnewmagazinetitlesisrecognisedasanexpense intheincomestatementasincurred.

(c) Computer software and website developmentNon-integralcomputersoftwarepurchasesarestatedatcostlessaccumulatedamortisation.Costsincurredinthedevelopmentofnewwebsitesarecapitalisedonlywherethecostcanbedirectlyattributedtodevelopingthewebsitetooperateinthemannerintendedbymanagementandonlytotheextentofthefutureeconomicbenefitsexpectedfromitsuse.Thesecostsareamortisedonastraight-linebasisovertheirestimatedusefullives(betweenoneandthreeyears).Costsassociatedwithmaintainingcomputersoftwareorwebsitesarerecognisedasanexpenseasincurred.

Impairment tests and Cash-Generating Units (CGUs)

ACGUisdefinedasthesmallestidentifiablegroupofassetsthatgeneratescashinflowsthatarelargelyindependentofthecashinflowsfromotherassetsorgroupsofassets.

Goodwillisnotamortisedbuttestedforimpairmentatleastonceayearormorefrequentlywhenthereisanindicationthatitmaybeimpaired.Therefore,theevolutionofgeneraleconomicandfinancialtrendsaswellasactualeconomicperformancecomparedtomarketexpectationsrepresentexternalindicatorsthatareanalysedbytheGroup,togetherwithinternalperformanceindicators,inordertoassesswhetheranimpairmenttestshouldbeperformedmorethanonceayear.

IAS36‘ImpairmentofAssets’requirestheseteststobeperformedatthelevelofeachCGUorgroupofCGUslikelytobenefitfromacquisition-relatedsynergies,withinanoperatingsegment.

Anyimpairmentofgoodwillisrecordedintheincomestatementasadeductionfromoperatingprofitandisneverreversedsubsequently.

Otherintangibleassetswithafinitelifeareamortisedandaretestedforimpairmentonlywherethereisanindicationthatanimpairmentmayhaveoccurred.

Recoverable amount

Todeterminewhetheranimpairmentlossshouldberecognised,thecarryingvalueof theassetsandliabilitiesoftheCGUsor groupsofCGUsiscomparedtotheirrecoverableamount.

CarryingvaluesofCGUsandgroupsofCGUstestedincludegoodwillandassetswithfiniteusefullives(property,plantandequipment,intangibleassetsandnetworkingcapital).

TherecoverableamountofaCGUisthehigherofitsfairvaluelesscoststosellanditsvalueinuse.Fairvaluelesscoststosellisthebestestimateoftheamountobtainablefromthesaleofanassetinanarm’slengthtransactionbetweenknowledgeable,willingparties,lessthecostsofdisposal.Thisestimateisdetermined,on30September,onthebasisofthediscountedpresentvalueofexpectedfuturecashflowsplusaterminalvalueandreflectsgeneralmarketsentimentandconditions.

ValueinuseisthepresentvalueofthefuturecashflowsexpectedtobederivedfromtheCGUsorgroupofCGUs.CashflowprojectionsarebasedoneconomicassumptionsandforecasttradingconditionsdrawnupbytheGroup’smanagement, asfollows:

• cashflowprojectionsarebasedonfive-yearbusinessplans;

• cashflowprojectionsbeyondthattimeframeareextrapolatedbyapplyinga2.0%growthratetoperpetuity;and

• thecashflowsobtainedarediscountedusingappropriateratesforthebusinessandtheterritoriesconcerned.

IfgoodwillhasbeenallocatedtoaCGUandanoperationwithinthatCGUisdisposed,thegoodwillassociatedwiththatoperationisincludedinthecarryingamountoftheoperationindeterminingtheprofitorlossondisposal.Thegoodwillallocatedtothedisposalismeasuredonthebasisoftherelativeprofitabilityoftheoperationdisposedandtheoperationsretained.

Inventories

Inventoriesarestatedatthelowerofcostandnetrealisablevalue.Forrawmaterials,costistakentobethepurchasepriceonafirstin,firstoutbasis.Forworkinprogressandfinishedgoods,costiscalculatedasthedirectcostofproduction.Itexcludesborrowingcosts.Netrealisablevalueistheestimatedsellingpriceintheordinarycourseofbusiness,lessapplicablevariablesellingexpenses.

Trade and other receivables

Tradeandotherreceivablesareinitiallyrecognisedatfairvalueandsubsequentlymeasuredatamortisedcostusingtheeffectiveinterestmethod,lessaprovisionforimpairment.

AprovisionforimpairmentoftradereceivablesismadewhenthereisobjectiveevidencethattheGroupwillnotbeabletocollectallamountsdueinaccordancewith theoriginaltermsofthereceivables.

Cash and cash equivalents

Cashandcashequivalentsincludecashinhand,depositsheldatcallwithbanksandbankoverdraftsforthepurposeofthecashflowstatement.Bankoverdraftsareshownwithinborrowingsincurrentliabilitiesonthebalancesheet.

Trade and other payables

Tradeandotherpayablesareinitiallyrecognisedatfairvalueandsubsequentlymeasuredatamortisedcostusingthe effectiveinterestmethod.



Borrowings

Borrowingsarerecognisedinitiallyatfairvalue,netoftransactioncostsincurred.Borrowingsaresubsequentlystatedatamortisedcostwithanydifferencebetweentheproceeds(netoftransactioncosts)andtheredemptionvaluerecognisedintheincomestatementovertheperiodoftheborrowingsusingtheeffectiveinterestmethod. BorrowingsareclassifiedascurrentliabilitiesunlesstheGrouphasanunconditionalrighttodefersettlementoftheliabilityforatleast12monthsafterthebalancesheetdate.

Provisions

ProvisionsarerecognisedwhentheGrouphasapresentlegalorconstructiveobligationasaresultofpastevents,anditismorelikelythannotthatanoutflowofresourceswillberequiredtosettletheobligation.

ProvisionsaremeasuredattheDirectors’bestestimateoftheexpenditurerequiredtosettletheobligationatthebalancesheetdate,andarediscountedtopresentvaluewheretheeffectismaterial.

Derivative financial instruments and hedging activities

TheGroupusesderivativefinancialinstrumentstoreduceexposuretoforeignexchangeandinterestraterisksandrecognisestheseatfairvalueinitsbalancesheet.TheGroupappliescashflowhedgeaccountingunderIAS39inrespectofcertaininstrumentsheld.Forinstrumentsforwhichhedgeaccountingisapplied,gainsandlossesaretakentoequity.Anychangestothefairvalueofderivativesnothedgeaccountedforarerecognisedintheincomestatement.AnynewinstrumentsenteredintobytheGroupwillbereviewedona‘casebycase’basisatinceptiontodeterminewhethertheyshouldqualifyashedgesandbeaccountedforaccordinglyunderIAS39.Inaccordancewithitstreasurypolicy,theGroupdoesnotholdorissueanyderivativefinancialinstrumentsfortradingpurposes.

Investments

TheCompany’sinvestmentsinsubsidiaryundertakingsarestatedatthefairvalue ofconsiderationpayable,includingrelatedacquisitioncosts,lessanyprovisions forimpairment.

Exceptional items

TheGroupclassifiestransactionsasexceptionalwheretheyrelatetoaneventthatfallsoutsidetheordinaryactivitiesofthebusinessandwhereindividuallyorinaggregatetheyhaveamaterialimpactonthefinancialstatements.ThisclassificationexcludesimpairmentchargesmadeonthecarryingvalueofCGUsorgroupsofCGUs.TheseparatereportingofexceptionalitemshelpsprovideabetterpictureoftheGroup’sunderlyingperformance.

Critical accounting assumptions, judgements and estimates

ThepreparationofthefinancialstatementsunderIFRSrequirestheuseofcertaincriticalaccountingassumptionsandrequiresmanagementtoexerciseitsjudgementandtomakeestimatesintheprocessofapplyingtheGroup’saccountingpolicies.Theareasrequiringahigherdegreeofjudgementorareaswhereassumptionsandestimatesaresignificanttothefinancialstatementsarediscussedbelow:

(a) Carrying value of goodwill and other intangiblesTheGroupusesforecastcashflowinformationandestimatesoffuturegrowthtoassesswhethergoodwillandotherintangibleassetsareimpaired.Iftheresultsofanoperationinfutureyearsareadversetotheestimatesusedforimpairmenttesting,animpairmentmaybetriggeredatthatpoint,orareductioninusefuleconomiclifemayberequired.Furtherdetailsareincludedwithinnote12.

(b) TaxationTheGroupissubjecttotaxinallterritories,andjudgementandestimatesoffutureprofitabilityarerequiredtodeterminetheGroup’sdeferredtaxposition.Ifthefinaltaxoutcomeisdifferenttothatassumed,resultingchangeswillbereflectedintheincomestatementorstatementofchangesinequityasappropriate.TheGroupcorporationtaxprovisionreflectsmanagement’sestimationoftheamountoftaxpayableforfiscalyearswithopentaxcomputationswhereliabilitiesremaintobeagreedwithHerMajesty’sRevenueandCustomsandothertaxauthorities.Furtherdetailsareincludedwithinnote7.

(c) Revenue recognitionTheGroupmakesaprovisionforsalesreturnsattheendofeachmonth.TheUKestimateiscalculatedbylookingattheforecastsalesprojectionsforthefollowingmonthofthe titlesthatwereonsaleattheyear-endandprovidingforanyshortfall.TheUSestimateis madebasedonastudyofthehistoriclevels ofreturns.

New or revised accounting standards and interpretations

Certainnewstandards,amendmentsandinterpretationstoexistingstandardshavebeenpublishedthataremandatoryforaccountingperiodsbeginningonorafter1October2016orlaterperiodsbutwhichtheGrouphaschosennottoadoptearly.TheseincludethefollowingstandardswhicharerelevanttotheGroup:

• AnnualimprovementstoIFRSs2012- 2014Cycle.

• AmendmenttoIAS1Presentationoffinancialstatementsonthedisclosureinitiative.

• AmendmenttoIAS16andIAS38Clarificationofacceptablemethodsofdepreciationandamortisation.

• AmendmenttoIFRS2Share-basedpaymenttoclarifytheclassificationandmeasurementofshare-basedpaymenttransactions.

• IFRS9Financialinstruments.

• IFRS15Revenuefromcontracts withcustomers.

• IFRS16Leases. AdoptionofIFRS16Leaseswillresultintherecognitiononthebalancesheetofassetsandliabilitiesrelatingtoleaseswhicharecurrentlyaccountedforasoperatingleases.TheGrouphasnotyetassessedthefullimpactofIFRS16whichwillbeeffectivefortheyearended30September2020.

TheGroupdoesnotexpectthattheotherstandardsandamendmentsissuedbutnotyeteffectivewillhaveamaterialimpactonresultsornetassets.


53 Future plc

1. Segmental reporting

TheGroupisorganisedandarrangedprimarilybyreportablesegment.TheexecutiveDirectorsconsidertheperformanceofthebusinessfromageographicalperspective,namelytheUKandtheUS.TheAustralianbusinessisconsideredtobepartoftheUKsegmentandisnotreportedseparatelyduetoitssize.

(a) Reportable segment(i) Segment revenue

2016£m

2015£m

UK 44.7 47.3US 15.2 13.4Revenuebetweensegments (0.9) (0.9)Total continuing operations 59.0 59.8

Transactionsbetweensegmentsarecarriedoutatarm’slength.

(ii) Segment EBITDAE

2016£m

2015£m

UK 2.8 3.3US 1.9 0.3Total segment EBITDAE from continuing operations 4.7 3.6

EBITDAEisusedbytheexecutiveDirectorstoassesstheperformanceofeachsegment.

AreconciliationoftotalsegmentEBITDAEfromcontinuingoperationstolossbeforetaxfromcontinuingoperationsisprovidedasfollows:

2016£m

2015£m

Total segment EBITDAE from continuing operations 4.7 3.6Depreciation (0.4) (0.5)Amortisation (2.0) (2.3)Exceptionalitems (3.5) (2.5)Impairmentofintangibleassets (13.0) -Netfinancecosts (0.7) (0.6)Loss before tax from continuing operations (14.9) (2.3)

(iii) Segment assets and liabilities

Segment assets Segment liabilities Segment net assets

2016£m

2015£m

2016£m

2015£m

2016£m

2015£m

UK 46.6 60.2 (26.5) (29.0) 20.1 31.2US 5.3 4.2 (4.2) (4.0) 1.1 0.2Total 51.9 64.4 (30.7) (33.0) 21.2 31.4

(iv) Other segment information

Additions to non-current assets

Depreciation and amortisation Impairment charges Exceptional items

2016£m

2015£m

2016£m

2015£m

2016£m

2015£m

2016£m

2015£m

UK 4.6 1.7 1.9 1.9 13.0 - 2.8 2.1US - 0.3 0.5 0.9 - - 0.7 0.4Continuingoperations 4.6 2.0 2.4 2.8 13.0 - 3.5 2.5Discontinuedoperations - - - - - - (0.3) (0.1)Total 4.6 2.0 2.4 2.8 13.0 - 3.2 2.4

Otherthantheitemsdisclosedaboveandashare-basedpaymentschargeof£0.5m(2015:£0.1m)therewerenoothersignificantnon-cashexpensesduringtheyear.

Notes to the financial statements



1. Segmental reporting (continued)

(b) Business segmentAftergeographicallocation,theGroupwasreorganisedduringtheyearintotwonewsegments.TheMediasegmentcompriseswebsitesandeventsandtheMagazinesegmentcomprisesmagazines.Anadditionalsegment,Other,wasretainedtoreflectunallocatedsalariesandotherdirectcostswhicharenotdirectlychargedtothebusinesssegmentsforinternalreportingpurposes.TheGroupconsidersthattheassetswithineachsegmentareexposedtothesamerisks.

(i) Revenue by business segment

2016£m

2015£m

Media 24.5 21.5Magazine 35.4 39.2Revenuebetweensegments (0.9) (0.9)Total continuing operations 59.0 59.8

(ii) Gross profit by business segment

2016£m

2015£m

Media 19.5 18.3Magazine 23.5 25.2Other (24.8) (27.8)Addback:distributionexpenses 3.6 3.5Total continuing operations 21.8 19.2

2. Operating loss from continuing operations

2016£m

2015£m

Revenue 59.0 59.8Costofsales (37.2) (40.6)Grossprofit 21.8 19.2Distributionexpenses (3.6) (3.5)Administrationexpenses (15.9) (14.9)Exceptionalitems (3.5) (2.5)Impairmentofintangibleassets (13.0) -Operating loss from continuing operations (14.2) (1.7)

3. Fees paid to auditors

2016£m

2015£m

AuditfeesinrespectoftheauditofthefinancialstatementsoftheCompanyandtheconsolidatedfinancialstatements 0.10 0.13Auditrelatedassuranceservices 0.02 0.02

0.12 0.15Taxcomplianceservices 0.05 0.10Taxadvisoryservices 0.03 0.08Servicesrelatingtocorporatefinancetransactions 0.14 -Total fees 0.34 0.33


55 Future plc

4. Exceptional items from continuing operations

2016£m

2015£m

Vacantpropertyprovisionmovements (0.5) 0.4Restructuringandredundancycosts 1.8 2.8Acquisition-relatedcosts 2.3 -Profitondisposalofmagazinetitlesandtrademarks (0.1) -Profitondisposalofproperty - (0.3)Provisionforbaddebts - (0.4)Total charge 3.5 2.5

ThevacantpropertyprovisionmovementduringtheyearrelatestosurplusofficespaceintheUKandtheUS.

Therestructuringandredundancycostsrelatemainlytostaffterminationpaymentsandotherrestructuringandtransformationrelatedactivities.

Theacquisition-relatedcostsrepresentfeesincurredinrespectoftheacquisitionofMiura(Holdings)Limited,theultimateparentcompanyofImaginePublishingLimited,whichwascompletedon21October2016.Furtherdetailsinrespectoftheacquisitionareshowninnote31.

Theprofitondisposalofpropertyin2015relatedtothesaleofoneoftheGroup’sUKpropertiesforcashproceedsof£1.2m.Theprovisionforbaddebtsin2015representsthereleaseofpartofaprovisionmadein2014inrelationtoamountsowedtotheGroupwhichwerenolongerconsideredrecoverablefollowingthefilingforbankruptcyofSourceHomeEntertainmentLLCanditsgroupcompanies,oneoftheGroup’sdistributorsintheUS.

5. Employees from continuing operations

2016£m

2015£m

Wagesandsalaries 21.3 23.6Socialsecuritycosts 2.0 2.2Otherpensioncosts 0.7 0.8Shareschemes-Valueofemployees’services 0.5 0.1Total staff costs from continuing operations 24.5 26.7

Average monthly number of people for continuing operations (including Directors)2016

No.2015No.

Production 399 436Administration 89 94Total 488 530

At30September2016,theactualnumberofpeopleemployedbytheGroupwas449(2015:521).Inrespectofourreportablesegments390(2015:448)wereemployedintheUKand59(2015:73)wereemployedintheUS.

Key management personnel compensation

Group 2016

£m

Company 2016

£m

Group 2015£m

Company2015£m

Salariesandothershort-termemployeebenefits 0.7 0.2 0.9 0.2Shareschemes-Valueofemployees’services 0.2 - - -Total 0.9 0.2 0.9 0.2

KeymanagementpersonnelaredeemedtobethemembersoftheBoardofFutureplc.ItisthisBoardwhichhasresponsibilityforplanning,directingandcontrollingtheactivitiesoftheGroup.

ZillahByng-ThorneandPennyLadkin-BrandwerepaidbyFuturePublishingLimited,asubsidiarycompany,fortheirservices.In2016£0.3m(2015:£0.1m)wasrechargedtoFutureplcbyFuturePublishingLimitedinrespectofZillahByng-Thorneand£0.2m(2015:£nil)wasrechargedinrespectofPennyLadkin-Brand.

FurtherdetailsontheDirectors’remunerationandinterestsaregivenintheDirectors’remunerationreportonpages29to39.ThehighestpaidDirectorduringtheyearwasZillahByng-Thorne(2015:ZillahByng-Thorne)anddetailsofherremunerationareshownonpage30.



6. Finance income and costs

2016£m

2015£m

Interestpayableoninterest-bearingloansandborrowings (0.1) (0.2)Amortisationofbankloanarrangementfees (0.1) (0.4)Otherfinancecosts (0.3) (0.2)Exchange(losses)/gains (0.2) 0.2Total finance costs (0.7) (0.6)Net finance costs from continuing operations (0.7) (0.6)

7. Tax on loss

Thetaxcreditedintheconsolidatedincomestatementforcontinuingoperationsisanalysedbelow:

2016£m

2015£m

UK corporation taxCurrenttaxat20%(2015:20.5%)onthelossfortheyear - -Adjustmentsinrespectofpreviousyears 1.3 (0.3)Current tax 1.3 (0.3)Deferred tax origination and reversal of temporary differencesCurrentyear(credit)/charge (1.6) 0.1Adjustmentsinrespectofpreviousyears (0.2) (0.1)Deferred tax (1.8) -Total tax credit on continuing operations (0.5) (0.3)

ThetaxassessedineachyeardiffersfromthestandardrateofcorporationtaxintheUKfortherelevantyear.Thedifferencesareexplainedbelow:

2016£m

2015£m

Lossbeforetax (14.9) (2.3)LossbeforetaxatthestandardUKtaxrateof20%(2015:20.5%) (3.0) (0.5)Non-deductibleamortisation&impairment 2.6 -Lossesgeneratedandunrecognised - 0.3LossesandothertimingdifferencesnotrecognisedinrespectoftaxintheUS - 0.2LossesandothertimingdifferencesrecognisedinrespectoftaxintheUS (1.4) -Profitsrelievedagainstbroughtforwardlosses (0.2) (0.1)Othernetdisallowableitems 0.4 0.2Adjustmentsinrespectofpreviousyears 1.1 (0.4)Total tax credit on continuing operations (0.5) (0.3)

In2013theGroupreachedagreementwithHMRCrelatingtothetaxtreatmentofcertainone-offtransactionswhichtookplacein2003.PartofthatagreementwillresultintheGrouppayingtaxof£6.2mplusinterest(comprisinginstalmentsof£85,000permonthoverfiveyearsfromJuly2013andafinalinstalmentof£2.0m).Thetaxpayablewasfullyprovidedforinprioryears’accounts.

Theliabilityinthebalancesheethasbeensplitbasedonthisagreementbetweencurrentliabilitiesandnon-currentliabilities.

TheprioryearadjustmentreflectsareassessmentoftheavailabilityofEUGrouplossreliefavailabletotheGroupasaresultoftheadditionaluncertaintysurroundingtheimpactoftheBrexitvoteonthesuccessoftheclaims.

TheDirectorshaveassessedtheGroup’suncertaintaxpositionsandarecomfortablethattheprovisionsinplacearenotmaterialeitherindividuallyorinaggregateandthatareasonablypossiblechangeinthenextfinancialyearwouldnothaveamaterialimpactontheresultsoftheGroup.


57 Future plc

8. Dividends

Equity dividends 2016 2015

Numberofsharesinissueatendofyear(million) 368.8 334.4Dividendspaidinyear(pencepershare) - -Dividends paid in year (£m) - -

9. Earnings per share

BasicearningspersharearecalculatedusingtheweightedaveragenumberofOrdinarysharesinissueduringtheyear.DilutedearningspersharehavebeencalculatedbytakingintoaccountthedilutiveeffectofsharesthatwouldbeissuedonconversionintoOrdinarysharesofawardsheldunderemployeeshareschemes.

Adjustedearningspershareremovestheeffectofexceptionalitems,impairmentofintangibleassetsandanyrelatedtaxeffectsfromthecalculation.

Total Group 2016 2015

Adjustmentstolossaftertax:Loss after tax (£m) (14.2) (1.3)Exceptionalitems(£m) 3.2 2.4Impairmentofintangibleassets(£m) 13.0 -Taxeffectoftheaboveadjustments(£m) (0.6) (0.5)Adjusted profit after tax (£m) 1.4 0.6

Weightedaveragenumberofsharesinissueduringtheyear:-Basic 362,486,525 332,796,904-Dilutiveeffectofshareoptions 13,074,591 536,550-Diluted 375,561,116 333,333,454Basiclosspershare(inpence) (3.9) (0.4)Adjustedbasicearningspershare(inpence) 0.4 0.2Dilutedlosspershare(inpence) (3.9) (0.4)Adjusteddilutedearningspershare(inpence) 0.4 0.2

Theadjustmentstolossaftertaxhavethefollowingeffect:Basic and diluted loss per share (pence) (3.9) (0.4)Exceptionalitems(pence) 0.9 0.7Impairmentofintangibleassets(pence) 3.6 -Taxeffectoftheaboveadjustments(pence) (0.2) (0.1)Adjusted basic and diluted earnings per share (pence) 0.4 0.2



9. Earnings per share (continued)

Continuing operations 2016 2015

Adjustmentstolossaftertax:Loss after tax (£m) (14.4) (2.0)Exceptionalitems(£m) 3.5 2.5Impairmentofintangibleassets(£m) 13.0 -Taxeffectoftheaboveadjustments(£m) (0.6) (0.4)Adjusted profit after tax (£m) 1.5 0.1

Weightedaveragenumberofsharesinissueduringtheyear:-Basic 362,486,525 332,796,904-Dilutiveeffectofshareoptions 13,074,591 536,550-Diluted 375,561,116 333,333,454Basiclosspershare(inpence) (4.0) (0.6)Adjustedbasicearningspershare(inpence) 0.4 -Dilutedlosspershare(inpence) (4.0) (0.6)Adjusteddilutedearningspershare(inpence) 0.4 -

Theadjustmentstolossaftertaxhavethefollowingeffect:Basic and diluted loss per share (pence) (4.0) (0.6)Exceptionalitems(pence) 1.0 0.7Impairmentofintangibleassets(pence) 3.6 -Taxeffectoftheaboveadjustments(pence) (0.2) (0.1)Adjusted basic and diluted earnings per share (pence) 0.4 -

Discontinued operations 2016 2015

Adjustmentstoprofitaftertax:Profit after tax (£m) 0.2 0.7Exceptionalitems(£m) (0.3) (0.1)Impairmentofintangibleassets(£m) - -Taxeffectoftheaboveadjustments(£m) - (0.1)Adjusted (loss)/profit after tax (£m) (0.1) 0.5

Weightedaveragenumberofsharesinissueduringtheyear:-Basic 362,486,525 332,796,904-Dilutiveeffectofshareoptions 13,074,591 536,550-Diluted 375,561,116 333,333,454Basicearningspershare(inpence) 0.1 0.2Adjustedbasicearningspershare(inpence) - 0.2Dilutedearningspershare(inpence) 0.1 0.2Adjusteddilutedearningspershare(inpence) - 0.2

Theadjustmentstoprofitaftertaxhavethefollowingeffect:Basic and diluted earnings per share (pence) 0.1 0.2Exceptionalitems(pence) (0.1) -Impairmentofintangibleassets(pence) - -Taxeffectoftheaboveadjustments(pence) - -Adjusted basic and diluted earnings per share (pence) - 0.2


59 Future plc



10. Discontinued operations

Nooperationswereclassifiedasdiscontinuedduringeitherthecurrentorprioryears.Theprofitfromoperationsdiscontinuedin2014isanalysedbelow.Onlythosecostsdirectlyattributabletothedisposedtitleshavebeenclassifiedwithindiscontinuedoperationsandnoapportionmentofcentraloverheadshasbeenmade.

2016£m

2015£m

Revenue - 0.2Costofsales (0.1) 0.4Gross(loss)/profit (0.1) 0.6Distributionexpenses - (0.1)Administrationexpenses - -Operating (loss)/profit before depreciation, amortisation, exceptional items and impairment of intangible assets (0.1) 0.5

Operating (loss)/profit (0.1) 0.5(Loss)/profit from discontinued operations before tax (0.1) 0.5(Loss)/profit after tax from discontinued operations (0.1) 0.5Gainonsaleofoperations 0.3 0.1Taxonsaleofoperations - 0.1Gainonsaleofoperationsaftertax 0.3 0.2Profit from discontinued operations 0.2 0.7

Thegainonsaleofoperationsin2016relatestothereleaseofaprovisionassociatedwithhistoricmagazinedisposals.Thegainonsaleofoperationsin2015relatedtocontingentconsiderationreceivedinrelationtotheCrafttitles.

11. Property, plant and equipment

Group

Land and buildings

£m

Plant and machinery

£m

Equipment, fixtures and

fittings£m

Total£m

Cost At1October2014 2.9 4.9 2.3 10.1Additions - 0.2 - 0.2Disposals (1.4) - (0.6) (2.0)Exchangeadjustments 0.1 0.1 0.1 0.3At30September2015 1.6 5.2 1.8 8.6Additions - 0.3 - 0.3Disposals (1.1) (2.4) (1.6) (5.1)Exchangeadjustments - 0.2 0.1 0.3At 30 September 2016 0.5 3.3 0.3 4.1

Accumulated depreciationAt1October2014 (2.6) (4.4) (2.1) (9.1)Chargefortheyear (0.1) (0.3) (0.1) (0.5)Disposals 1.4 - 0.5 1.9Exchangeadjustments (0.1) (0.2) - (0.3)At30September2015 (1.4) (4.9) (1.7) (8.0)Chargefortheyear - (0.3) (0.1) (0.4)Disposals 1.1 2.3 1.6 5.0Exchangeadjustments - (0.2) - (0.2)At 30 September 2016 (0.3) (3.1) (0.2) (3.6)

Net book value at 30 September 2016 0.2 0.2 0.1 0.5Netbookvalueat30September2015 0.2 0.3 0.1 0.6Netbookvalueat1October2014 0.3 0.5 0.2 1.0

Depreciationisincludedwithinadministrationexpensesintheconsolidatedincomestatement.

12. Intangible assets

GroupGoodwill

£m

Magazine and website

£mOther

£m Total

£m

Cost At1October2014 285.6 15.2 15.3 316.1Additions - - 1.8 1.8Disposals - (3.1) (2.8) (5.9)Exchangeadjustments 1.9 0.3 0.5 2.7At30September2015 287.5 12.4 14.8 314.7Additionsthroughbusinesscombinations 1.5 1.1 - 2.6Otheradditions - - 1.7 1.7Disposals - (0.2) (0.2) (0.4)Exchangeadjustments 4.9 1.0 1.2 7.1At 30 September 2016 293.9 14.3 17.5 325.7

Accumulated amortisationAt1October2014 (244.7) (15.1) (11.9) (271.7)Chargefortheyear - (0.1) (2.2) (2.3)Disposals - 3.1 2.7 5.8Exchangeadjustments (1.9) (0.3) (0.5) (2.7)At30September2015 (246.6) (12.4) (11.9) (270.9)Chargefortheyear - - (2.0) (2.0)Impairment (13.0) - - (13.0)Disposals - 0.2 0.2 0.4Exchangeadjustments (4.8) (1.0) (1.2) (7.0)At 30 September 2016 (264.4) (13.2) (14.9) (292.5)

Net book value at 30 September 2016 29.5 1.1 2.6 33.2Netbookvalueat30September2015 40.9 - 2.9 43.8Netbookvalueat1October2014 40.9 0.1 3.4 44.4

Magazineandwebsiterelatedassetsrelatemainlytotrademarks,advertisingrelationships,e-commercetechnologyandcustomerlists.Theseassetsareamortisedovertheirestimatedeconomiclives,typicallyrangingbetweenoneandfifteenyears.

Anyresidualamountarisingasaresultofthepurchaseconsiderationbeinginexcessofthevalueofidentifiedmagazinerelatedassetsisrecordedasgoodwill.GoodwillisnotamortisedunderIFRS,butissubjecttoimpairmenttestingeitherannuallyorontheoccurrenceofsometriggeringevent.Goodwillisrecordedandtestedforimpairmentonaterritorybyterritorybasis.

Furtherdetailsregardingtheintangibleassetsacquiredduringtheyearthroughbusinesscombinationsaresetoutinnote29.

Otherintangiblesrelatetocapitalisedsoftwarecostsandwebsitedevelopmentcosts.

Amortisationisincludedwithinadministrationexpensesintheconsolidatedincomestatement.

Impairment assessments for goodwill and other intangiblesThegoodwillbalanceat30September2016and30September2015relatestotheUK.

Thebasisforcalculatingrecoverableamountsisdescribedintheaccountingpolicies.

Trendsintheeconomicandfinancialenvironment,competitionandregulatoryauthorities’decisions,orchangesincompetitorbehaviourinresponsetotheeconomicenvironmentmayaffecttheestimateofrecoverableamounts,aswillunforeseenchangesinthepolitical,economicorlegalsystemsofsomecountries.


61 Future plc



12. Intangible assets (continued)

Otherassumptionsthatinfluenceestimatedrecoverableamountsaresetoutbelow:

At30September2016

UK

BasisofrecoverableamountSourceused

ValueinuseFiveyearplans

Discountedcashflow

Growthratetoperpetuity 2.0%EBITDAEmarginsassumed 2.4%to3.7%Post-taxdiscountrate 8.2%Pre-taxdiscountrate 10.3%

At30September2015

UK

BasisofrecoverableamountSourceused

ValueinuseFiveyearplans

Discountedcashflow

Growthratetoperpetuity 2.0%EBITDAEmarginsassumed 5.2%to12.4%Post-taxdiscountrate 9.0%Pre-taxdiscountrate 11.3%

Sensitivity of recoverable amountsAt30September2016theanalysisoftherecoverableamountsgaverisetothefollowingassessmentsofsensitivity:

UKAnimpairmentchargehasbeenrecordedintheyearasnotedbelow.Thereforethevalueinuseiseffectivelythesameasthecarryingvalue.Anyfutureperformancewhichfallsslightlyshortofthatusedtodeterminethosevalueswouldbeliabletoresultinafurtherimpairment.Achangeofplusorminus50basispointsinthepost-taxdiscountratewoulddecreaseorincreaserespectivelytherecoverableamountby£1.6m.Likewiseachangeofplusorminus10%intheforecastcashflowsoverthenextfiveyearswouldincreaseordecreaserespectivelytherecoverableamountby£0.6m.

Impairment At30September2016animpairmentchargeof£13.0mhasbeentakenagainstthecarryingvalueoftheUKbusiness.ThisreflectsashiftintheunderlyingforecastprofitabilityandcashflowsoftheUKandthecontinueddeclineofprint.


13. Investments in Group undertakings

Company2016

£m2015£m

Shares in Group undertakingsAt1October 131.9 131.9Provisionforimpairment (130.9) -At30September 1.0 131.9

InSeptember2016theDirectorsreviewedtheirvaluationsoftheCompany’sinvestments.Followingthisreview,andthereceiptofadividendof£130.9m,theCompany’sinvestmentinRhoHoldingsLimitedwaswrittendowntoacarryingvalueof£nilresultinginanimpairmentchargeof£130.9m.

14. Deferred tax assets and liabilities

ThefollowingarethemajordeferredtaxassetsandliabilitiesrecognisedbytheGroup,andthemovementsthereon,duringthecurrentandprioryears.

Intangible assets

£m

Short term timing

differences£m

Depreciation vs tax allowances

£mTax losses

£mTotal

£m

At1October2014and30September2015 (0.7) - 0.4 0.1 (0.2)Acquisitions (0.3) - - - (0.3)Creditedtoincomestatement–Continuingoperations 0.1 0.2 0.1 1.4 1.8

Exchangeadjustment - - - 0.2 0.2At 30 September 2016 (0.9) 0.2 0.5 1.7 1.5

ThechangestothemainrateofcorporationtaxfortheUKannouncedintheJuly2015Budgetweresubstantivelyenactedon18November2015andthechangeannouncedintheMarch2016Budgetwassubstantivelyenactedon15September2016.Thechangesreducedthemainrateofcorporationtaxto19%from1April2017andto17%from1April2020.Asthesechangeshadbeensubstantivelyenactedbeforetheyear-end,anyimpacthasbeenincludedinthesefinancialstatements.

Certaindeferredtaxassetsandliabilitieshavebeenoffsetagainsteachotherwheretheyrelatetothesamejurisdiction.Thefollowingistheanalysisofdeferredtaxbalancesafteroffsetforbalancesheetpurposes:

2016£m

2015£m

Deferredtaxassets 2.4 0.5Deferredtaxliabilities (0.9) (0.7)Net deferred tax asset/(liability) 1.5 (0.2)

Thedeferredtaxassetof£2.4m(2015:£0.5m)isdisclosedasanon-currentassetofwhichtheassetsduewithinoneyeartotal£0.1m(2015:£0.1m).Thedeferredtaxliabilityof£0.9m(2015:£0.7m)isdisclosedasanon-currentliabilityofwhichtheliabilitiesduewithinoneyeartotal£nil(2015:£nil).

Asat30September2016theGrouphas:•unprovideddeferredtaxassetsontaxlossestotalling£5.9m(2015:£16.1m)ofwhich£5.4m(2015:£15.0m)aroseintheUS;and•unprovideddeferredtaxassetsonothertemporarydifferencestotalling£1.1m(2015:£1.1m)ofwhich£1.1m(2015:£1.1m)aroseintheUS.

Deferredtaxassetshavebeenrecognisedinrespectoftaxlossesandothertemporarydifferenceswhereitisprobablethattheseassetswillberecovered.

Nodeferredtaxisrecognisedontheunremittedearningsofoverseassubsidiariesasanyremittedearningswouldnotgiverisetoataxliabilityintheforeseeablefuture.

TheCompanyhasnounprovideddeferredtaxassetsorliabilitiesat30September2016(2015:£nil).

63 Future plc



15. Inventories

2016£m

2015£m

Rawmaterials 0.1 0.1Workinprogress 0.3 0.3Finishedgoods - 0.1Total 0.4 0.5

Thecostofrawmaterialinventoriesrecognisedasanexpenseandincludedwithincostofsalesamountedto£3.5m(2015:£3.5m).

16. Trade and other receivables

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

Current assets:Tradereceivables 9.2 - 11.3 -Provisionsforimpairmentoftradereceivables (0.6) - (0.6) -Tradereceivablesnet 8.6 - 10.7 -AmountsowedbyGroupundertakings - 43.4 - 46.7Otherreceivables 0.3 - 0.5 -Prepaymentsandaccruedincome 3.3 0.1 4.0 -

12.2 43.5 15.2 46.7Non-current assets:Otherreceivables 0.2 - 0.1 -Total 12.4 43.5 15.3 46.7

TheDirectorsconsiderthatthecarryingamountoftradeandotherreceivablesapproximatestheirfairvalue.

Receivablebalancesfromthetwomainmagazinedistributors,oneintheUKsegmentandoneintheUSsegment,represented26%(2015:30%)oftheGroup’stradereceivablesbalanceat30September2016.

TheGrouphasprovidedforestimatedirrecoverableamountsinaccordancewithitsaccountingpolicydescribedonpage52ofthesefinancialstatements.

Creditchecksareobtainedand,ifapplicable,guaranteesputinplacebeforeanewcustomerisacceptedandtermsandcreditlimitsareagreed.Bookingsarenottakenbeforethesefactorshavebeenfulfilled.Inaddition,annualcreditchecksarecarriedoutandfullydocumented.Finaldecisionsoncredittermsaremadebyanappropriateseniormanagerwithinadvertisingorfinance.Intheeventofarequesttoincreaseacustomer’screditlimitthefollowingfactorswillbeconsidered:tradinghistorytodate,reviewofcreditstatusandreviewofthereasonfortheincrease.

IncludedwithintheGroup’stradereceivablesbalancearereceivableswithacarryingamountof£3.0m(2015:£2.9m)whicharepastdueatthereportingdatebutforwhichtheGrouphasnotprovidedastherehasnotbeenasignificantchangeincreditqualityandtheGroupbelievesthattheamountsarestillrecoverable.TheserelatetoadvertisingandlicensingdebtorsintheUKandUS.TheGroupdoesnotholdanysecurityoverthesebalances.Abreakdownoftheageingissetoutbelow:

Past due

Group2016

£m

Group2015£m

0-30days 1.6 0.731-60days 0.8 0.561-90days 0.3 0.591+days 0.3 1.2Total 3.0 2.9

16. Trade and other receivables (continued)

Asat30September2016,tradereceivablesof£0.6m(2015:£0.6m)wereimpairedandprovidedfor.Theindividuallyimpairedreceivablesmainlyrelatetoadvertisingandlicensingcustomers.Itisassessedthataportionofthereceivablesisexpectedtoberecovered.

ThemovementintheGroupprovisionfortradereceivablesduringtheyearisasfollows:

Group2016

£m

Group2015£m

At1October 0.6 1.1Provisionforreceivablesimpaired 0.1 (0.1)Receivableswrittenoffduringtheyear (0.1) (0.4)At 30 September 0.6 0.6

Thecreationandreleaseofprovisionsforimpairedreceivableshavebeenincludedinadministrationexpensesintheincomestatementwiththeexceptionofacreditof£0.4min2015relatingtoadistributorthatfiledforbankruptcywhichwasincludedwithinexceptionalitems,asdescribedinnote4.Amountschargedtotheprovisionarewrittenoffwhenthereisnorealisticexpectationofrecoveringadditionalcash.

Theotherassetclasseswithintradeandotherreceivablesdonotcontainimpairedassets.

Themaximumexposuretocreditriskatthereportingdateisthecarryingvalueofeachclassofreceivablementionedabove.TheGroupdoesnotholdanycollateralassecurityfortradereceivables.

AlltheCompany’sreceivablesarewithGroupundertakings,withtheexceptionof£0.1m(2015:£nil)relatingtoprepaidshareissuecosts,andnoadditionaldisclosureinrelationtocreditriskisrequired.Intereston£0.3m(2015:£0.3m)oftheamountsowedbyGroupundertakingshasbeenchargedatthree-monthLIBOR+2.6%.ThebalanceofamountsowedbyGroupundertakingsisinterest-freewithoutanytermsforrepayment.

17. Cash and cash equivalents

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

Cashatbankandinhand 2.9 - 2.5 -Cash and cash equivalents (excluding bank overdraft) 2.9 - 2.5 -

Cashandcashequivalentsincludethefollowingforthepurposesofthecashflowstatements:

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

Cashatbankandinhand 2.9 - 2.5 -Bankoverdraft(note19) - (1.0) (0.9) (8.8)Cash and cash equivalents 2.9 (1.0) 1.6 (8.8)

TheGrouphasanumberofauthorisedcounterpartieswithwhomcashbalancesareheldinthecountriesinwhichtheGroupoperates.Creditriskisminimisedbyconsideringthecreditstandingofallpotentialbankersbeforeselectingthembytheuseofexternalcreditratings.98%oftheGroup’scashisheldatcounterpartieswithanS+PcreditratingofBBB+.


65 Future plc



18. Trade and other payables

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

Tradepayables 4.4 - 6.8 -AmountsowedtoGroupundertakings - 0.8 - 124.0Othertaxationandsocialsecurity 0.8 - 0.7 -Otherpayables 0.8 - 1.2 -Accrualsanddeferredincome 15.4 1.6 12.0 -Total 21.4 2.4 20.7 124.0

Tradepayablesandaccrualsprincipallycompriseamountsoutstandingfortradepurchasesandongoingcosts.TheGrouphasfinancialriskmanagementpoliciesinplacetoensureallpayablesarepaidwithintheagreedcreditterms.

TheDirectorsconsiderthatthecarryingamountoftradepayablesapproximatestotheirfairvalue.

AmountsowedtoGroupundertakingsweresettledintheyearthroughassignmentofamountsowedbyotherGroupundertakings.AmountsowedtoGroupundertakingsareunsecuredandinterest-freewithoutanytermsforrepayment.

19. Financial liabilities – loans, borrowings and overdrafts

Non-current liabilities

Interest rate at30 September

2016

Interestrateat30September

2015

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

Obligationsunderfinanceleases 9.6% - 0.1 - - -Total 0.1 - - -

Current liabilities

Interest rate at30 September

2016

Interestrateat30September

2015

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

Bankoverdraft - 3.0% - - 0.9 0.9Sterlingrevolvingloan 2.5% 3.0% 2.3 2.3 3.4 3.4Total 2.3 2.3 4.3 4.3

Theinterest-bearingloansandoverdraftarerepayableasfollows:

Group2016

£m

Company2016

£m

Group2015£m

Company2015£m

Withinoneyear 2.3 2.3 4.3 4.3Betweenoneandtwoyears 0.1 - - -Total 2.4 2.3 4.3 4.3


67 Future plc

19. Financial liabilities – loans, borrowings and overdrafts (continued)

ThetotalmulticurrencyrevolvingandoverdraftfacilityavailabletotheGroupat30September2016amountedto£5.0m.On21October2016,followingtheacquisitionofImagine,theGroupnegotiatedanewbankfacilitywithHSBCBankplctoreplaceitsexistingfacilitywithSantanderplcandnowhasfacilitiestotalling£14.0m,comprisingan£8.5mtermloan,a£3.5mrevolvingcreditfacilityanda£2.0muncommittedoverdraftfacility.Thenewfacilitiesrunto23June2021.Repaymentsarerequiredinrespectofthetermloanasfollows:

Repayment date Repayment amount30September2017 £600,00030September2018 £800,00030September2019 £1,000,00030September2020 £1,250,00023 June 2021 £4,850,000

TheGrouphasgrantedsecuritytothebanksandtheavailabilityofthefacilityissubjecttocertaincovenants.

Feesrelatingtothenewfacilityamountedto£0.4mandthesewillbeamortisedovertheinitialtermofthefacility(capitalisedfeesrelatingtotheoldfacilitywere£0.1mat30September2016).ThebankborrowingsandinterestareguaranteedbyFutureplc,FutureHoldings2002Limited,FuturePublishingLimited,FutureUS,Inc,FuturePublishing(Overseas)Limited,FutureIPLimited,FutureFolioLimitedandalloftheentitiesacquiredaspartoftheImagineacquisition(beingMiura(Holdings)Limited,Fascination(Holdings)Limited,Skaro(Holdings)Limited,ImaginePublishingGroupLimitedandImaginePublishingLimited).

Interestpayableunderthecurrentcreditfacilityiscalculatedasthecostofone-monthLIBOR(currentlyapproximately0.3%)plusaninterestmarginofbetween2.00%and2.50%,dependentonthelevelofBankEBITDAE.

Thekeycovenantsaresetoutinthefollowingtablewherenetdebtisexclusiveofnon-currenttaxandBankEBITDAEisnotmateriallydifferenttostatutoryEBITDAEonatotalGroupbasis.

Netdebt/BankEBITDAE Periodsfrom31March2017–lessthan2.25times

BankEBITDAE/Interest Periodsfrom31March2017–morethan4.00times

Thecovenantsaretestedquarterlyonthebasisofrollingfiguresforthepreceding12months.Duetothechangeofbankersnocovenanttestingwasrequiredatyear-end,howevertheGroupwasinfullcompliancewithallcovenantsatalltestingdatesduringtheyearended30September2016.

TheCompanyalsohasanon-interest-bearingoverdraftof£1.0m(2015:£7.9m)whichformspartoftheGroupcashpoolingaccountandcanbeoffsetagainstcashbalancesinotherGroupcompanies.

20. Provisions

GroupProperty

£m

At1October2015 2.1Chargedintheyear 0.2Releasedintheyear (0.5)Utilisedintheyear (0.3)At 30 September 2016 1.5

Theprovisionforpropertyrelatestodilapidationsandobligationsundershortleaseholdagreementsonvacantproperty.Thevacantpropertyprovisionisexpectedtobeutilisedoverthenextfiveyears.

ProvisionsfortheCompanywere£nil(2015:£nil).

21. Other non-current liabilities

Group2016

£m2015£m

Otherpayables 0.5 0.8

Otherpayablesconsistmainlyofdeferredpropertyleaseliabilitiesand,in2015,deferredsubscriptionrevenue.

22. Financial instruments

Financial instruments by category

TheGroup’sfinancialassetsandfinancialliabilitiesaresetoutbelow:

Amortised cost 2016

Group Note

Loans and receivables

£m

Other liabilities

£m

Total carrying value

£m

Total fairvalue

£m

Tradereceivablesnet 16 8.6 - 8.6 8.6Otherreceivables 1.7 - 1.7 1.7Cashandcashequivalents 17 2.9 - 2.9 2.9Total financial assets 13.2 - 13.2 13.2Tradepayables 18 - (4.4) (4.4) (4.4)Otherliabilities - (10.3) (10.3) (10.3)Overdraft 19 - - - -Currentborrowings 19 - (2.3) (2.3) (2.3)Non-currentborrowings 19 - (0.1) (0.1) (0.1)Total financial liabilities - (17.1) (17.1) (17.1)

Amortised cost 2015

Group Note


£m

Other liabilities

£m


£m

Total fair value

£m

Tradereceivablesnet 16 10.7 - 10.7 10.7Otherreceivables 2.4 - 2.4 2.4Cashandcashequivalents 17 2.5 - 2.5 2.5Total financial assets 15.6 - 15.6 15.6Tradepayables 18 - (6.8) (6.8) (6.8)Otherliabilities - (10.5) (10.5) (10.5)Overdraft 19 - (0.9) (0.9) (0.9)Currentborrowings 19 - (3.4) (3.4) (3.4)Total financial liabilities - (21.6) (21.6) (21.6)

Totalfinancialliabilitiesareshownnetofunamortisedcostswhichamountedto£0.1m(2015:£0.1m).




69 Future plc

22. Financial instruments (continued)

TheCompany’sfinancialassetsandliabilitiesaresetoutbelow:

Amortised cost 2016

Company Note


£m

Other liabilities

£m


£m

Total fair value

£m

Otherreceivables 16 43.4 - 43.4 43.4Total financial assets 43.4 - 43.4 43.4Otherliabilities 18 - (2.4) (2.4) (2.4)Overdrafts 19 - (1.0) (1.0) (1.0)Currentborrowings 19 - (2.3) (2.3) (2.3)Total financial liabilities - (5.7) (5.7) (5.7)

Amortised cost 2015

Company Note


£m

Other liabilities

£m


£m

Total fair value

£m

Otherreceivables 16 46.7 - 46.7 46.7Total financial assets 46.7 - 46.7 46.7Otherliabilities 18 - (124.0) (124.0) (124.0)Overdrafts 19 - (8.8) (8.8) (8.8)Currentborrowings 19 - (3.4) (3.4) (3.4)Total financial liabilities - (136.2) (136.2) (136.2)

Totalfinancialliabilitiesareshownnetofunamortisedcostswhichamountedto£0.1m(2015:£0.1m).

Thefairvalueistheamountforwhichafinancialinstrumentcouldbeexchangedbetweenknowledgeable,willingparties.Ifanactivemarketexists,themarketpriceisapplied.Ifanactivemarketdoesnotexistadiscountedcashfloworgenerallyacceptedestimationandvaluationtechniquebasedonmarketconditionsatthebalancesheetdateisusedtocalculateanestimatedvalue.

Themarketvalueoffinancialinstrumentsisdeterminedbytheuseofvaluationtechniquesincludingestimateddiscountedcashflows.

Treasury overviewTheGroupusesfinancialinstrumentstoraisefundingforitsoperationsandtomanagethefinancialrisksarisingfromthoseoperations.TheagreementsgoverningtheprincipalinstrumentsenteredintowereapprovedbytheBoard.

TheprincipalfinancingandtreasuryexposuresfacedbytheGrouparisefromforeigncurrencies,workingcapitalmanagement,thefinancingofcapitalexpenditureandacquisitions,themanagementofinterestratesontheGroup’sdebt,theinvestmentofsurpluscashandthemanagementoftheGroup’sdebtfacilities.TheGroupmanagesalloftheseexposureswithanobjectiveofremainingwithincovenantratiosagreedwiththeGroup’sbanks,andtheGrouphasbeenincompliancewithitscovenantsduringtheyear.Theseratiosaredisclosedinnote19.

ThecapitalstructureoftheGroupisreviewedregularlybytheBoardtoensurethatthedebt/equityratiooffundingremainsappropriatefortheGroup.

Inordertomaintainoradjustthecapitalstructure,theGroupmayreturncapitaltoshareholders,issuenewsharesorsellassetstoreducedebt.




Currency and interest rate profileThecurrencyandinterestrateprofileoftheGroup’sfinancialassetsandliabilitiesisshownbelow:

Financial assets Financial liabilities

Floating rate£m

Non- interest bearing

£mTotal

£m

Floating rate£m

Fixed rate£m

Non-interest bearing

£m Total

£m

Net financial (liabilities)/

assets£m

At 30 September 2016Currency:Sterling - 4.1 4.1 (2.3) (0.1) (10.2) (12.6) (8.5)USDollar - 7.5 7.5 - - (3.2) (3.2) 4.3Euro - 0.4 0.4 - - (0.2) (0.2) 0.2Other - 1.2 1.2 - - (1.1) (1.1) 0.1Total - 13.2 13.2 (2.3) (0.1) (14.7) (17.1) (3.9)

At30September2015Currency:Sterling - 9.6 9.6 (4.3) - (13.4) (17.7) (8.1)USDollar - 4.7 4.7 - - (3.5) (3.5) 1.2Euro - 0.6 0.6 - - (0.1) (0.1) 0.5Other - 0.7 0.7 - - (0.3) (0.3) 0.4Total - 15.6 15.6 (4.3) - (17.3) (21.6) (6.0)

Interest rate riskDetailsoftheinterestratesonborrowingsasat30September2016aresetoutinnote19.

TheGroup’soverallpolicyonhedginginterestrateriskisasfollows:•Totheextentthatnetdebtisbelow£10mthereisnorequirementtohedgeagainstinterestratefluctuationsonthebalanceofthegrossdebt.•Totheextentthatnetdebtisabove£10maminimumof25%ofthebalanceofthegrossdebtgreaterthan£10mshouldbehedged.

Inapplyingtheabovepolicy,managementtakesfullconsiderationofcashflowprojectionstofixtheperiodforwhichanyhedgingarrangementsareenteredinto.

For2016,ifinterestratesonnetborrowingshadbeenonaverage0.5%higher/lowerwithallothervariablesheldconstant,thepost-taxlossfortheyearwouldhavedecreased/increasedby£nil(2015:£nil).

Therewouldbenoimpactonequityexcludingretainedearnings.

Foreign exchange riskSomeoftheGroup’sactivitiesarecarriedoutincountriesoutsidetheUnitedKingdomwheretransactionsarecarriedoutinthatcountry’sownfunctionalcurrency.MovementsinexchangeratescanthereforehaveasignificantimpactontheGroup’stotalcashflows,whilstthetranslationoftheresults,assetsandliabilitiesofforeignoperationsintosterlingcanhaveasignificanteffectontheGroup’sreportedprofitsandbalancesheet.ThemainexposuresaretomovementsintheUSDollarandAustralianDollaragainststerling.


71 Future plc


TheGroup’spolicyformanagingexchangerateriskissummarisedasfollows:

• Transactionexposure-theGroupmanagesthisbyensuringthattransactionsaredenominatedinthelocalfunctionalcurrencyoftheoperatingunitswhereverpossible.Wherethisisnotpossibletheuseofforwardcontractstohedgeexposureisconsidered.Theuseofforwardcontracts(oranyotherderivativefinancialinstrument)issubjecttoauthorisationbytheChiefFinancialOfficer.

• Translationexposure–theGroupmatchescurrencyassetswithcurrencyliabilitieswhereverpossible.

ThefollowingtablesummarisestheGroup’ssensitivitytotranslationalcurrencyexposuresat30September:

2016 currency risks expressed in Currency 1/Currency 2£m GBP/USD GBP/AUD

Reasonableshift 10% 10%ImpactonlossaftertaxifCurrency1strengthensagainstCurrency2 (0.5) -ImpactonlossaftertaxifCurrency1weakensagainstCurrency2 0.5 -ImpactonequityexcludingretainedearningsifCurrency1strengthensagainstCurrency2 0.5 -ImpactonequityexcludingretainedearningsifCurrency1weakensagainstCurrency2 (0.5) -

2015currencyrisksexpressedinCurrency1/Currency2£m GBP/USD GBP/AUD

Reasonableshift 10% 10%ImpactonlossaftertaxifCurrency1strengthensagainstCurrency2 - 0.1ImpactonlossaftertaxifCurrency1weakensagainstCurrency2 - (0.1)ImpactonequityexcludingretainedearningsifCurrency1strengthensagainstCurrency2 - (0.1)ImpactonequityexcludingretainedearningsifCurrency1weakensagainstCurrency2 - 0.1

Liquidity riskTheGroupfundsthebusinesslargelyfromcashflowsgeneratedfromoperationsandlong-termdebt.DetailsoftheGroup’sborrowingsaredisclosedinnote19.

TheGroupmonitorsandmanagesthecashfortheGroupandhasmaintainedcommittedbankingfacilitiesasnotedabovetomitigateanyliquidityriskitmayface.Ifnecessary,inter-companyloanswithintheGroupmeetshort-termcashneeds.ThefollowingtableshowstheGroup’sremainingcontractualmaturityforfinancialliabilitiesandderivativefinancialinstruments.ThetablehasbeendrawnupbasedontheundiscountedcashflowsoffinancialliabilitiesbasedontheearliestdateonwhichtheGroupisobligedtopay:

30 September 2016

Less than one year

£m

Between one and two years

£m

Between two and five years

£m

Over five years

£mTotal

£m

Tradepayables (4.4) - - - (4.4)Otherliabilities (9.2) (0.1) (1.0) - (10.3)Overdraft - - - - -Borrowings (2.3) (0.1) - - (2.4)Total financial liabilities (15.9) (0.2) (1.0) - (17.1)

30September2015

Less than one year

£m

Between one and two years

£m

Between two and five years

£m

Over five years

£mTotal

£m

Tradepayables (6.8) - - - (6.8)Otherliabilities (9.3) (0.1) (0.9) (0.2) (10.5)Overdraft (0.9) - - - (0.9)Borrowings (3.4) - - - (3.4)Total financial liabilities (20.4) (0.1) (0.9) (0.2) (21.6)



23. Issued share capital

2016£m

2015£m

Authorised share capital 600,000,000 Ordinary shares of 1p each 6.0 6.0

2016 2015

Number of shares £m

Numberofshares £m

Allotted, issued and fully paid Ordinary shares of 1p eachAtbeginningofyear 334,441,247 3.3 333,781,473 3.3PlacingofOrdinaryshares 33,440,000 0.4 - -Shareschemeexercises 861,894 - 653,725 -ShareIncentivePlanmatchingshares 15,446 - 6,049 -At end of year 368,758,587 3.7 334,441,247 3.3

On27November2015theCompanycompletedaplacingof33,440,000Ordinaryshareswithanominalvalueof£334,400foratotalcashcommitmentof£3,344,000.Duringtheyear861,894Ordinaryshareswithanominalvalueof£8,619wereissuedbytheCompanypursuanttoshareschemeexercisesandafurther15,446OrdinaryshareswereissuedundertheShareIncentivePlanforatotalcashcommitmentof£nil,asdetailedinnote24.

In2015653,725Ordinaryshareswithanominalvalueof£6,537wereissuedbytheCompanyforatotalcashcommitmentof£nilpursuanttoshareschemeexercisesasdetailedinnote24.

24. Share-based payments

Theincomestatementchargefortheyearforshare-basedpaymentswas£0.5m(2015:£0.1m).Thischargehasbeenincludedwithinadministrationexpenses.

ThesechargesarisewhenemployeesaregrantedawardsundertheGroup’sshareoptionschemes,performanceshareplan(PSP),deferredannualbonusscheme(DABS)orShareIncentivePlan(SIP)andwhenemployeesaregrantedawardsbythetrusteesofTheFutureNetworkplc1999EmployeeBenefitTrust(EBT).ThechargeequatestothefairvalueoftheawardandhasbeencalculatedusingtheMonteCarloandBlack-Scholesmodels,usingthemostappropriatemodelforeachscheme.Assumptionshavebeenmadeinthesemodelsforexpectedvolatility,risk-freeratesanddividendyields.

Areconciliationofmovementsinshareoptionsandothershareincentiveschemesisshownbelow:

2016Number of

options/awards

2016Weighted average

exercise price

2015Numberof

options/awards

2015Weightedaverage

exerciseprice

Outstandingatthebeginningoftheyear 16,182,214 £0.012 12,885,930 £0.027Granted 11,806,730 £0.000 12,293,441 £0.000Shareawardsexercised–newshareissues (861,894) £0.000 (653,725) £0.000Lapsed (6,282,269) £0.021 (8,343,432) £0.017Outstandingat30September 20,844,781 £0.003 16,182,214 £0.012Exercisableat30September 349,304 £0.000 57,052 £0.000

Theweightedaveragesharepriceatthedateofexerciseofshareoptionsandothershareincentiveawardsduringtheyearwas£0.088(2015:£0.104).


73 Future plc

24. Share-based payments (continued)

Foroptionsandothershareincentiveschemesoutstandingat30Septembertheweightedaverageexercisepricesandremainingcontractuallivesareasfollows:

Number of options/awards Weighted average exercise priceWeighted average remaining

contractual life in years

2016 2015 2016 2015 2016 2015

Sharesave PlanDecember2012 - 691,958 £0.140 £0.140 - 1December2013 520,606 805,833 £0.130 £0.130 1 2PSPDecember2012 - 678,159 - - - -December2013 2,156,022 2,156,022 - - - 1July2014 2,500,000 2,500,000 - - 1 2February2015 3,717,353 6,336,415 - - 1 2May2015 1,046,979 1,046,979 - - 2 3August2015 1,647,834 1,647,834 - - 2 3November2015 6,388,860 - - - 2 -September2016 2,415,730 - - - 3 -DABSNovember2009 1,043 1,043 - - - -December2010 5,924 5,924 - - - -January2012 25,304 50,085 - - - -December2012 7,050 159,869 - - - -December2013 102,093 102,093 - - - 1November2015 309,983 - - - - -Total outstanding at 30 September 20,844,781 16,182,214 £0.003 £0.012 2 2

Thefairvaluepershareforgrantsmadeduringtheyearandtheassumptionsusedinthecalculationareasfollows:

2016 2015

DABS PSP PSP PSP PSP PSP

Grantdate 30/11/15 30/11/15 01/09/16 04/02/15 18/05/15 03/08/15Sharepriceatgrantdate £0.1088 £0.1088 £0.088 £0.109 £0.105 £0.106Exerciseprice - - - - - -Vestingperiod(years) 1 3 3 3 3 3Expectedvolatility 50% 50% 49% 55% 54% 54%Optionlife(years) 1 3 3 3 3 3Expectedlife(years) 1 3 3 3 3 3Risk-freerate 0% 1% 0% 1% 1% 1%Dividendyield - - - - - -Fairvalue £0.1088 £0.1088 £0.088 £0.101 £0.099 £0.100Fairvalue–EPSelement - £0.1088 £0.088 £0.109 £0.105 £0.106Fairvalue–cashelement - £0.1088 £0.088 £0.093 £0.093 £0.093

Notes:1.TheexpectedvolatilityisbasedonFuture’shistoricalvolatility,averagedoveraperiodequaltotheexpectedlife,wherepossible.2.TheGrouphasusedtheBlack-Scholesmodeltovalueinstrumentswithnon-market-basedperformancecriteriasuchasearningspershare.Forinstrumentswithmarket-basedperformancecriteria,notablytotalshareholderreturn,theGrouphasusedaMonteCarlomodeltodeterminethefairvalue.TheBlack-Scholesmodelhasbeenusedtovaluealloptionswiththeexceptionof50%ofcertainPSPgrantswhichhavemarket-basedperformancecriteria;theMonteCarlomodelhasbeenusedtovaluetheseawards.

3.InFebruary2016,theperformancecriteriainrespectof50%ofawardsgrantedinFebruary2015,May2015andAugust2015waschangedfromTSRperformancetonetcashflow.Thefairvalueoftheseawardshasbeenrecalculatedasatthedateofthechange.

FutureplcoperatesoneshareoptionschemebeingtheFutureplc2010ApprovedSharesavePlan(2010SharesavePlan)andat30September2016optionshadbeengrantedunderthisscheme.



24. Share-based payments (continued)

The 2010 Sharesave Plan (the Sharesave Plan)UndertheSharesavePlantheoptionentitlementgrantedtoparticipatingemployeesislinkedtothemonthlycontributionswhichsuchemployeeshaveagreedtopayintotheSharesavePlan(uptoamaximumamountof£250permonth).TheoptionsgrantedundertheSharesavePlanvestonthethirdanniversaryofthegrantofsuchoptions.Wherelegalandregulatoryconstraintspermit,theCompanyusesitsdiscretiontoofferoptionsgrantedundertheSharesavePlanatadiscounttothemarketpriceinforceatthedateoftheinvitationbeingmade.

Other share-based paymentsNofurthershareoptionsaretobegranted.Instead,theGrouphasputintoplaceanumberofalternativeshareincentiveschemes.

Performance Share Plan (PSP)ThePSPisashare-basedincentiveschemeopentotheexecutiveDirectorsandcertainotherkeyseniormanagers,usuallybasedonapercentageoftheparticipant’ssalary.Awardsunderthisschemearesubjecttostretchingperformancecriteriameasuredagainstbothearningspershare(EPS)andeithertotalshareholderreturn(TSR)ornetcashflow,dependingonthedateofgrant.Subjecttotheparticipant’scontinuedemploymentwithintheGroup,awardswillvestthreeyearsafterthedateofgrantassumingthatthefollowingperformancecriteriaareachieved:

Performancecriteriainrespectofawardsgrantedpriorto4February2015

• Amaximumof50%ofanawardwillvestiftheGroup’sgrowthinadjustedEPSisequaltoRPIplus8%,0%willvestiftheGroup’sgrowthinadjustedEPSisequaltoRPIplus3%,andvestingwillbeonaproratastraight-linebasisbetweenthetwo.IfgrowthintheGroup’sadjustedEPSislessthanRPIplus3%,noneofthat50%oftheawardwillvest.

• Theremaining50%oftheawardwillvestiftheCompany’sTSRperformance,comparedtoagroupofsimilarcompanies,placesitinthetopquintileasagainstthecomparatorcompanies.IftheCompany’sTSRperformanceismedian,12.5%oftheawardwillvest,andvestingwillbeonaproratastraight-linebasisbetweenthetwopoints.IftheCompany’sperformanceisbelowmedian,noneofthat50%oftheawardwillvest.Thecomparatorgroupofcompaniesisasdisclosedonpage32ofthisAnnualReport.

Performancecriteriainrespectofawardsgrantedbetween4February2015and29November2015

InFebruary2016,theRemunerationCommitteeexerciseditsdiscretiontochangetheperformancecriteriainrespectof50%ofawardsgrantedbetween4February2015and29November2015fromTSRperformancetonetcashflowinordertobetteraligntheinterestsofparticipantsandshareholders.TherewasnochangetotheEPSperformancecriteriainrespectoftheremaining50%oftheseawards.Therevisedperformancecriteriaareasfollows:

• Amaximumof50%ofanawardwillvestiftheGroup’sadjustedEPSfortheyearended30September2017(thelastfinancialyearoftheperformanceperiod)is1.4p,12.5%willvestiftheGroup’sEPSis1.0p,andvestingwillbeonaproratastraight-linebasisbetweenthetwo.IftheGroup’sadjustedEPSisbelow1.0p,noneofthat50%oftheawardwillvest.

• Theremaining50%oftheawardwillvestiftheGroup’snetcashflowfortheyearended30September2017(thelastfinancialyearoftheperformanceperiod)is£1.25m,12.5%willvestiftheGroup’snetcashflowis£0.25m,andvestingwillbeonaproratastraight-linebasisbetweenthetwo.IftheGroup’snetcashflowisbelow£0.25m,noneofthat50%oftheawardwillvest.

Performancecriteriainrespectofawardsgrantedbetween30November2015and30September2016

• Amaximumof50%ofanawardwillvestiftheGroup’sadjustedEPSfortheyearended30September2018(thelastfinancialyearoftheperformanceperiod)is1.5p,12.5%willvestiftheGroup’sEPSis1.2p,andvestingwillbeonaproratastraight-linebasisbetweenthetwo.IftheGroup’sadjustedEPSisbelow1.2p,noneofthat50%oftheawardwillvest.

• Theremaining50%oftheawardwillvestiftheGroup’snetcashflowfortheyearended30September2018(thelastfinancialyearoftheperformanceperiod)is£0.75m,12.5%willvestiftheGroup’snetcashflowis£(0.25)m,andvestingwillbeonaproratastraight-linebasisbetweenthetwo.IftheGroup’snetcashflowisbelow£(0.25)m,noneofthat50%oftheawardwillvest.

GrantsweremadeunderthePSPinFebruary2015,May2015,August2015,November2015andSeptember2016.

Deferred Annual Bonus Scheme (DABS)TheDABSisashare-basedincentiveschemeopentocertainmanagersacrosstheGroup.ThemaximumvalueofanysharesgrantedundertheDABStoanyoneparticipantwillbeanamountwhichisequaltoafixedpercentageofthateligibleparticipant’sannualbonusforthepreviousfinancialyear.ThenumberofsharesoverwhichanawardistobegrantedtoeachparticipantwillbecalculatedbyreferencetothemarketvalueofanOrdinaryshareintheCompanyonthedateoftheaward.UnlesstheRemunerationCommitteedecidesotherwiseatthedateofgrant,thesharesawardedundertheDABSwillvestsixmonthsafterthedateoftheaward,subjectonlytotheemployeeremainingintheemploymentoftheGroupthroughoutthevestingperiod.

AgrantwasmadeundertheDABSinNovember2015.

Share Incentive Plan (SIP)InApril2015theGroupadoptedaSIPwhichisopentoallUKemployeesincludingtheexecutiveDirectors.Theschemeisataxefficientincentiveplanpursuanttowhichemployeesareeligibletoacquireupto£150(or10%ofsalary,ifless)worthofOrdinarysharesintheCompanypermonthor£1,800perannum.UndertheSIPemployeesareinvitedtosubscribeforPartnershipsharesviasalarydeductions.IfanemployeeagreestobuyPartnershipsharestheCompanycurrentlymatchesthenumberofPartnershipsharesboughtwithanawardofMatchingsharesonthebasisofoneMatchingshareforeveryfourPartnershipshares.MatchingshareawardstodatehavebeenmetbytheissueofOrdinarysharestoYorkshireBuildingSocietyasTrusteeoftheSIP.


75 Future plc

25. Other reserves

Treasury reserveThetreasuryreserverepresentsthecostofsharesinFutureplcpurchasedinthemarketandheldbytheEBTtosatisfyawardsmadebythetrustees.

Group 2016

£m

Group 2015£m

Atbeginningandendofyear (0.3) (0.3)

The1,426,848(2015:1,426,848)sharesheldbytheEBTrepresent0.4%(2015:0.4%)oftheCompany’sissuedsharecapital.Thetreasuryreserveisnon-distributable.

Merger reserveThemergerreserveof£109.0m(2015:£109.0m)arosefollowingthe1999Groupreorganisationandisnon-distributable.

26. Pensions

TheGroupoperatesadefinedcontributionschemeforemployeesresidentintheUnitedKingdom.

IntheUS,theGroupoperatesasection401(K)profitsharingdefinedcontributionplaninrespectofpensions,whichcoverssubstantiallyallFutureUSemployees.Thesection401(K)planallowsemployeestoinvestin29fundsrunbyT.RowePrice,buttheemployees,nottheemployer,havecompletecontroloverwhichfundstheyinvestin,althoughtheyhavenocontroloverthestocksownedbythefunds.

Duringtheyear,£0.7m(2015:£0.8m)contributionsweremadetotheseplansandat30September2016theoutstandingbalanceduetobepaidovertotheplanswas£0.1m(2015:£0.1m).

27. Commitments and contingent liabilities

(a) Operating lease commitmentsAt30September2016,theGrouphadthefollowingtotalfutureleasepaymentsundernon-cancellableoperatingleases:

Land and buildings

£mOther

£m

Total2016

£m

Landandbuildings

£mOther

£m

Total2015£m

Withinoneyear 2.2 - 2.2 2.5 0.1 2.6Betweenoneandfiveyears 6.4 - 6.4 5.8 - 5.8Afterfiveyears 7.0 - 7.0 5.8 - 5.8Total 15.6 - 15.6 14.1 0.1 14.2

Futureminimumsub-leasereceiptsexpectedundernon-cancellablesubleasesat30September2016total£1.8m(2015:£1.5m).

Duringtheyear,£1.6m(2015:£1.9m)wasrecognisedintheincomestatementinrespectofoperatingleaserentalpaymentsand£0.4m(2015:£0.2m)wasrecognisedinrespectofsub-leasereceipts.

TheGroupleasesvariousofficesundernon-cancellableoperatingleaseagreements.Theleaseshavevariousterms,escalationclausesandrenewalrights.TheGroupalsoleasesotherequipmentundernon-cancellableoperatingleaseagreements.

(b) Contingent liabilitiesTherearenocontingentliabilitiesexpectedtoresultinamateriallossfortheGroup.

(c) Capital commitmentsTherewerenomaterialcapitalcommitmentsasat30September2016(2015:£nil).

28. Related party transactions

TheGrouphadnomaterialtransactionswithrelatedpartiesin2016or2015whichmightreasonablybeexpectedtoinfluencedecisionsmadebyusersofthesefinancialstatements.

Duringtheyear,theCompanyhadmanagementchargespayableof£0.5m(2015:£0.2m)tosubsidiaryundertakings.Theoutstandingbalanceowedat30September2016was£0.5m(2015:£0.2m).



29. Acquisitions

Acquisition of Blaze PublishingOn12May2016,FuturePublishingLimitedacquiredcertainassetsfromBlazePublishingLimitedforcashconsiderationof£0.4m.Inaddition,deferredconsiderationofupto£0.3mispayableby12May2017basedongrosscontributiontargets.

Theimpactoftheacquisitionontheconsolidatedbalancesheetwas:

Book value£m

Fair value adjustment

£m

Provisional fair value

£m

Intangibleassets:-Advertisingrelationships - 0.4 0.4Tradeandotherpayables (0.2) - (0.2)Deferredtaxliabilities - (0.1) (0.1)Net assets acquired (0.2) 0.3 0.1Goodwill 0.6

0.7ConsiderationConsiderationsatisfiedby:Cash-initialconsideration 0.4Cash-deferredconsideration 0.3Total consideration 0.7

ThegoodwillisattributabletothesynergiesexpectedtoariseinintegratingthemagazinesandeventsintothewiderFuturegroup.Theadvertisingrelationshipswillbeamortisedoveraperiodoffifteenyears.

IncludedwithintheGroup’sresultsfortheyeararerevenuesof£0.9mandprofitfortheyearof£nilfromtheBlazeassets.

Iftheacquisitionhadbeencompletedonthefirstdayofthefinancialyear,itwouldhavecontributed£2.8mofrevenueandprofitof£0.1mduringtheyear.

Acquisition of Next Commerce Pty LtdOn15August2016,FuturePublishing(Overseas)Limitedacquired100%ofthesharecapitalofNextCommercePtyLtdforcashconsiderationof£0.3m.Inaddition,deferredconsiderationofupto£0.6m,intheformofsharesinFutureplc,ispayableby24January2017basedonrevenueperformance.


Book value£m


£m


£m

Intangibleassets:-E-commercetechnology - 0.6 0.6Tradeandotherreceivables 0.2 - 0.2Cash 0.1 - 0.1Tradeandotherpayables (0.3) (0.1) (0.4)Deferredtaxliabilities - (0.2) (0.2)Net assets acquired - 0.3 0.3Goodwill 0.6

0.9ConsiderationConsiderationsatisfiedby:Cash-initialconsideration 0.3Deferredconsiderationdueinfutureyears 0.6Total consideration 0.9

ThegoodwillisattributabletothesynergiesexpectedtoariseinleveragingthetechnologyacquiredacrossFuture’sexistingportfolio.Thee-commercetechnologywillbeamortisedoveraperiodoftenyears. IncludedwithintheGroup’sresultsfortheyeararerevenuesof£0.2mandprofitfortheyearof£nilfromNextCommercePtyLtd.

Iftheacquisitionhadbeencompletedonthefirstdayofthefinancialyear,itwouldhavecontributed£2.0mofrevenueandprofitof£0.2mduringtheyear.


77 Future plc

29. Acquisitions (continued)

Acquisition of Noble House Media LimitedOn5April2016,FuturePublishingLimitedacquired100%ofthesharecapitalofNobleHouseMediaLimitedforcashconsiderationof£0.1m.


Book value£m


£m


£m

Intangibleassets:-Eventsacquired - 0.1 0.1Tradeandotherreceivables 0.1 - 0.1Tradeandotherpayables (0.4) - (0.4)Net liabilities acquired (0.3) 0.1 (0.2)Goodwill 0.3

0.1ConsiderationConsiderationsatisfiedby:Cash 0.1Total consideration 0.1

ThegoodwillisattributabletothesynergiesexpectedtoariseinintegratingtheeventsintothewiderFuturegroup.

IncludedwithintheGroup’sresultsfortheyeararerevenuesof£0.3mandlossfortheyearof£(0.1)mfromNobleHouseMediaLimited.

Iftheacquisitionhadbeencompletedonthefirstdayofthefinancialyear,itwouldhavecontributed£0.8mofrevenueandprofitof£nilduringtheyear.



30. Subsidiary undertakings

DetailsoftheCompany’ssubsidiariesat30September2016aresetoutbelow.Allsubsidiariesareincludedintheconsolidation.Sharesofthosecompaniesmarkedwithan*areindirectlyownedbyFutureplcthroughanintermediateholdingcompany.

Company name and registered numberCountry of

incorporation Nature of business Holding % Class of shares

A&SPublishingCompanyLimited*01584580 EnglandandWales Non-trading 100 £1Ordinaryshares

ECVPriceMalaysiaSdn.Bhd.*1021502-V Malaysia Dormant 100 RM1Ordinaryshares

FutureHoldings(2002)Limited04387886 EnglandandWales Holdingcompany 100 £1Ordinaryshares

FutureIPLimited08207186 EnglandandWales Intellectualproperty 100 £1Ordinaryshares

FuturePublishingLimited*02008885 EnglandandWales Publishing 100 £1Ordinaryshares

FuturePublishing(Overseas)Limited*06202940 EnglandandWales Publishing 100 £1Ordinaryshares

FuturePublishingHoldingsLimited03430449 EnglandandWales Holdingcompany 87.5 1penceOrdinaryshares

FutureUS,Inc*0513070 USA(StateofCalifornia) Publishing 100 Notapplicable

FutureVerlagGmbH*HRB125675 Germany Non-trading 87.5 €1Ordinaryshares

FutureFolioLimited*07956484 EnglandandWales Digitalpublishingsolutions 100 £1Ordinaryshares

FXMInternationalLimited04212478 EnglandandWales Non-trading 100 £1Ordinaryshares

RhoHoldingsLimited00040056 Guernsey Investmentcompany 100 £1Ordinaryshares

NextCommercePhilippinesInc*CS201517783 Philippines Dormant 100 ₱1Ordinaryshares

NextCommercePtyLtd*113 146 786 Australia Comparisonshopping

searchengine 100 $1Ordinaryshares

NobleHouseMediaLimited*03220964 EnglandandWales Publishing 100 £1Ordinaryshares

PricepandaGroupGmbH*HRB138471B Germany Dormant 100 €1Ordinaryshares

PricepandaSingaporePteLtd*201214200D Singapore Dormant 100 €1Ordinaryshares

SarraceniaLimited*04582851 EnglandandWales Dormant 100 £1Ordinaryshares

A&SPublishingCompanyLimited,FutureHoldings(2002)Limited,FutureIPLimited,FuturePublishingLimited,FutureFolioLimited,FXMInternationalLimitedandNobleHouseMediaLimitedareexemptfromtherequirementtofileauditedaccountsbyvirtueofSection479AoftheCompaniesAct2006.SarraceniaLimitedisexemptfromtherequirementtofileauditedaccountsbyvirtueofSection480oftheCompaniesAct2006.

31. Post balance sheet event

On21October2016theCompanycompletedtheacquisitionof100%ofthesharecapitalofMiura(Holdings)Limited,theholdingcompanyandultimateparentcompanyofImaginePublishingLimited,fortotalconsiderationof179,567,841newOrdinarysharesintheCompanywhich,attheclosingpriceof8.5pon20October2016,representsconsiderationof£15.3m.AspartofthistransactiontheGrouprefinanced,enteringintonewbankfacilitiestotalling£14.0m.Furtherdetailsofthesenewfacilitiesareincludedwithinnote19.

Fairvalueinformationontheassetsandliabilitiesacquiredisnotyetavailable.

Notice of Annual General Meeting

Ordinary Business

Ordinary resolutions

1. ToreceiveandadopttheauditedfinancialstatementsoftheCompanyforthefinancialyearended30September2016andthereportsoftheDirectorsandtheauditors(the“AnnualReport”).

2. ToapprovetheDirectors’remunerationimplementationreportassetoutinpages30to35oftheAnnualReportoftheCompanyforthefinancialyearended30September2016.

3. ToapprovetheRemunerationpolicyreportassetoutinpages36to39oftheAnnualReportoftheCompanyforthethreeyearperiodcommencingon1October2016.

4. ToelectasaDirectorJamesHanbury.

5. Tore-electasaDirectorPeterAllen.

6. Tore-electasaDirectorZillah Byng-Thorne.

7. Tore-electasaDirectorPenny Ladkin-Brand.

8. Tore-electasaDirectorManjit Wolstenholme.

9. Tore-electasaDirectorHugoDrayton.

10. ToreappointPricewaterhouseCoopersLLP,CharteredAccountantsandRegisteredAuditors,asauditorsoftheCompanytoholdofficeuntiltheconclusionofthenextGeneralMeetingatwhichaccountsarelaidbeforetheCompany.

11. ToauthorisetheDirectorstodeterminetheremunerationoftheauditorsoftheCompany.

12. That,insubstitutionforanyexistingauthority,theDirectorsbeandareherebygenerallyandunconditionallyauthorisedinaccordancewithsection551oftheCompaniesAct2006(the‘Act’)toexerciseallthepowersoftheCompanytoallotsharesintheCompanyandtograntrightstosubscribefor,ortoconvertanysecurityinto,sharesintheCompany:

12.1 inconnectionwithanofferbywayofarightsissue(comprisingequitysecuritiesasdefinedbysection560oftheAct),uptoanaggregatenominalamountof£3,656,200(suchamounttobereducedbythenominalamountofanyrelevantsecuritiesallottedunderparagraph12.2below):

(a) toholdersofOrdinarysharesinthecapitaloftheCompanyinproportion(asnearlyasmaybepracticable)totheirrespectiveholdingsofOrdinarysharesinthecapitaloftheCompany;and

(b) toholdersofanyotherequitysecurities

asrequiredbytherightsofthosesecuritiesorastheDirectorsotherwiseconsidernecessary,butsubjecttosuchexclusionsorotherarrangementsastheBoardmaydeemnecessaryorexpedientinrelationtotreasuryshares,fractionalentitlements,recorddates,legalorpracticalproblemsinorunderthelawsofanyterritory,ortherequirementsofanyregulatorybodyorstockexchange;and

12.2inanyothercase,uptoanaggregatenominalamountof£1,828,100(suchamounttobereducedbythenominalamountofanyequitysecuritiesallottedunderparagraph12.1aboveinexcessof£1,828,100),atanytimeortimesduringtheperiodbeginningonthedateofthepassingofthisresolutionandendingfollowingtheconclusionoftheCompany’snextAnnualGeneralMeetingor,ifearlier,on31March2018(unlesspreviouslyrevokedorvariedbytheCompanyinGeneralMeeting)savethattheCompanymaybeforeexpiryofthisauthoritymakeanofferoragreementwhichwouldormightrequirerelevantsecuritiestobeallottedafteritsexpiryandtheDirectorsmayallotrelevantsecuritiespursuanttosuchanofferoragreementasiftheauthorityherebyconferredhadnotexpired.

13. That,followingthebroaderdefinitionsintroducedbysections363to365oftheActofthetermsusedin(i),(ii)and(iii)below(whichforthepurposesofthisresolutionhavethemeaningsgivenbytheAct),theCompanyanditssubsidiariesatanytimeduringtheperiodforwhichtheresolutioniseffectivebeauthorisedtogetherto:

(i) makepoliticaldonationstopoliticalpartiesand/orindependentelectioncandidatesnotexceeding£50,000intotal;

(ii) makepoliticaldonationstopoliticalorganisationsotherthanpoliticalpartiesnotexceeding£50,000intotal;and

ThisNoticeofMeetingisimportantandrequiresyourimmediateattention.

Ifyouareinanydoubtastowhatactionyoushouldtake,youshouldconsultyourstockbroker,bankmanager,solicitor,accountantorotherindependentadviserauthorisedundertheFinancialServicesandMarketsAct2000.

IfyouhavesoldorotherwisetransferredallyoursharesinFutureplc,pleaseforwardthisnotice,togetherwiththeaccompanyingdocuments,assoonaspossibleeithertothepurchaserortransferee,ortothepersonwhoarrangedthesaleortransfersothattheycanpassthesedocumentstothepurchaserortransferee.


NoticeisherebygiventhattheeighteenthAnnualGeneralMeetingofFutureplcwillbeheldonWednesday1February2017atFuture’sLondonoffice,1-10PraedMews,LondonW21QYat10:30amatwhichthefollowingresolutionsnumbered1to14willbeproposedasordinaryresolutions,andresolutionsnumbered15to18willbeproposedasspecialresolutions.

79 Future plc

(iii) incurpoliticalexpenditurenotexceeding£50,000intotal,duringtheperiodbeginningwiththedateofthepassingofthisresolutionandendingfollowingtheconclusionoftheCompany’snextAnnualGeneralMeetingor,ifearlier,on31March2018.

14. That,subjecttoandconditionalupon admissionoftheNewOrdinaryShares (asdefinedbelow)tothestandardlisting segmentoftheOfficialListandtotrading onLondonStockExchangeplc’smain marketforlistedsecuritiesbecoming effective,every15Ordinarysharesof1 penceeachinthecapitalofthe Companyinissueandoutstandingor heldintreasuryasat6.00p.m.on Wednesday,1February2017(orsuch othertimeanddateastheDirectorsmay determine)beconsolidatedinto1 Ordinaryshareof15penceinthecapital oftheCompany(eacha“NewOrdinary Share”),providedthat,wheresuch consolidationresultsinanymember beingentitledtoafractionofaNew OrdinaryShare,suchfractionshall,so faraspossible,beaggregatedwiththe fractionsofNewOrdinarySharesto whichothermembersoftheCompany maybeentitledandtheDirectorsbeand areherebyauthorisedtosell(orappoint anyotherpersontoselltoanyperson), onbehalfoftherelevantmembers,all theNewOrdinarySharesrepresenting suchfractionsatthebestprice reasonablyobtainabletoanyperson, andtopaytheproceedsofsale(netof expenses)indueproportiontothe relevantmembersentitledthereto(save thatanyfractionofapennywhichwould otherwisebepayableshallberounded upordowninaccordancewiththeusual practiceoftheregistraroftheCompany and,subjecttoresolution17being passed,iftheproceedsarelessthan £3.00inthecaseofanyoneshareholder, theywillbedonatedtocharitieschosen bytheCompany)andthatanyDirector (oranypersonappointedbythe Directors)shallbeandishereby authorisedtoexecuteaninstrumentof transferinrespectofsuchshareson behalfoftherelevantmembersandtodo allactsandthingstheDirectorsconsider necessaryorexpedienttoeffectthe transferofsuchsharesto,orin accordancewiththedirectionsof,any buyerofanysuchshares.

Special resolutions

15. That,subjecttothepassingofresolution12,theDirectorsbeandareherebyauthorisedpursuanttoArticle3.2andsection570oftheActtoallotequitysecurities(withinthemeaningofsection560oftheAct)forcashpursuanttotheauthorityconferreduponitforthepurposesofsection551oftheActbyresolution12providedthatsuchauthorityshallbelimitedto:

(a) theallotmentofequitysecuritiesinconnectionwithanofferbywayofarightsissue,openofferorpre-emptiveoffertoholdersofOrdinarysharesontheregisterofmembersoftheCompanyonadatefixedbytheDirectorswheretheequitysecuritiestobeallottedtoexistingshareholdersshallbeinproportion(asnearlyasmaybe)totheirrespectiveholdingsand,iftherightsattachingtoanyotherequitysecuritiessoprovide,infavouroftheholdersofthoseequitysecuritiesinaccordancewithsuchrights,butsubjecttosuchexclusionsorotherarrangementsastheDirectorsconsidernecessaryorexpedientinconnectionwithOrdinarysharesrepresentingfractionalentitlementsoronaccountofeitherlegalorpracticalproblemsarisinginconnectionwiththelawsofanyterritory,oroftherequirementsofanygenerallyrecognisedregulatorybodyorstockexchangeinanyterritory;and

(b) theallotment(otherwisethanpursuanttosub-paragraph(a)above)ofequitysecuritiesuptoanaggregatenominalamountof£548,430(representingjustunder10%oftheissuedsharecapitaloftheCompanyasat13December2016)andsuchauthorityshallexpireattheconclusionoftheCompany’snextAnnualGeneralMeetingor,ifearlier,on31March2018(savethattheCompanymaybeforetheexpiryofsuchauthoritymakeanofferoragreementwhichwouldormightrequireequitysecuritiestobeallottedafteritsexpiryandtheDirectorsmayallotequitysecuritiespursuanttosuchanofferoragreementasifthepowerherebyconferredhadnotexpired).

16. Thatageneralmeeting,otherthananAnnualGeneralMeeting,maybecalledonnotlessthan14cleardays’notice.

17. ThatthearticlesofassociationoftheCompany(the“Articles”)beamendedsoastoaddthefollowingparagraphattheendofArticle2.5:“Whereanymember’sentitlementtoaportionoftheproceedsofsaleamountstolessthanaminimumfiguredeterminedbytheDirectorsfromtimetotime(andifnotsodetermined£3.00),thatmember’sportionmay,attheDirectors’discretion,bedistributedtoaninstitutionwhichisacharityforthepurposesofthelawofEnglandandWales.”

18. ThattheArticlesbeamendedsoastoaddthefollowingArticle27:“PowertochangethenameoftheCompanyTheBoardmaychangethenameoftheCompany.”

OnbehalfoftheBoard

Penny Ladkin-BrandChiefFinancialOfficerandCompanySecretary13December2016

80AnnualReportandAccounts2016Financial Statem

ents

Notes

Further information about the AGM

1. Informationregardingthemeeting,includingtheinformationrequiredbysection311AoftheAct,isavailablefrom:www.futureplc.com/invest-in-future.

Attendance at the AGM

2. Ifyouwishtoattendthemeetinginperson,pleasebringtheattendancecardattachedtoyourformofproxyandarriveatFuture’sLondonoffice,1-10PraedMews,LondonW21QY,insufficienttimeforregistration.Appointmentofaproxydoesnotprecludeamemberfromattendingthemeetingandvotinginperson.Ifamemberhasappointedaproxyandattendsthemeetinginperson,theproxyappointmentwillautomaticallybeterminated.

Appointment of proxies

3. Anymemberentitledtoattendandvoteatthemeetingmayappointoneormoreproxiestoattend,speakandvoteintheirplace.Amembermayappointmorethanoneproxyprovidedthateachproxyisappointedtoexercisetherightsattachedtoadifferentshareorsharesheldbythatshareholder.Ifyouappointmultipleproxiesforanumberofsharesinexcessofyourholding,theproxyappointmentsmaybetreatedasinvalid.AproxyneednotbeamemberoftheCompany.Aproxycardisenclosed.Tobeeffective,proxycardsshouldbecompletedinaccordancewiththesenotesandthenotestotheproxyform,signedandreturnedsoastobereceivedbytheCompany’sRegistrars:

ComputershareInvestorServicesPLC,ThePavilions,BridgwaterRoad,BristolBS996ZY notlaterthan10:30amonMonday30January2017beingtwobusinessdaysbeforethetimeappointedfortheholdingofthemeeting.Ifyousubmitmorethanonevalidproxyappointment,theappointmentreceivedlastbeforethelatesttimeforthereceiptofproxieswilltakeprecedence.

Electronic appointment of proxies

4. Asanalternativetocompletingtheprintedproxyform,youmayappointaproxyelectronicallybyvisitingthefollowingwebsite:www.investorcentre.co.uk/eproxy.

YouwillbeaskedtoentertheControlNumber,theShareholderReferenceNumber(SRN)andPINasprintedonyourproxyformandtoagreetocertaintermsandconditions.Tobeeffective,electronicappointmentsmusthavebeenreceivedbytheCompany’sRegistrarsnotlaterthan10:30amonMonday30January2017.

Number of shares in issue

5. Asatthecloseofbusinesson13December2016(beingthelastbusinessdaypriortothepublicationofthisnotice)theCompany’sissuedsharecapitalconsistedof548,430,719Ordinarysharesofonepennyeach.EachOrdinarysharecarriesonevote.Therearenosharesheldintreasury.ThetotalnumberofvotingrightsintheCompanyistherefore548,430,719.

Documents available for inspection

6. PrintedcopiesoftheservicecontractsoftheCompany’sDirectorsandthelettersofappointmentforthenon-executiveDirectorswillbeavailableforinspectionduringusualbusinesshoursonanyweekday(Saturdays,Sundaysandpublicholidaysexcluded)attheCompany’sLondonofficeat

1-10PraedMews, London, W21QY

andattheCompany’sregisteredofficeat QuayHouse, TheAmbury, Bath, BA11UA

includingonthedayofthemeetingfrom 10:15amuntilitscompletion.

Eligible shareholders

7. TheCompany,pursuanttoRegulation41ofTheUncertificatedSecuritiesRegulations2001,specifiesthatonlythosemembersontheregisteroftheCompanyasat6pmonMonday30January2017or,ifthismeetingisadjourned,intheregisterofmembers48hoursbeforethetimeofanyadjournedmeeting,shallbeentitledtoattendandvoteatthemeetinginrespectofthenumberofsharesregisteredintheirnameatthattime.ChangestoentriesontheRegisterafter6pmonMonday30January2017or,ifthismeetingisadjourned,intheregisterofmembers48hoursbeforethetimeofanyadjournedmeeting,shallbedisregardedindeterminingtherightsofanypersontoattendorvoteatthemeeting.

Indirect investors

8. Anypersontowhomthisnoticeissentwhoisapersonthathasbeennominatedundersection146oftheActtoenjoyinformationrights(a‘NominatedPerson’)doesnothavearighttoappointaproxy.However,aNominatedPersonmay,underanagreementwiththeregisteredshareholderbywhomtheywerenominated(a‘RelevantMember’),havearighttobeappointed(ortohavesomeoneelseappointed)asaproxyforthemeeting.Alternatively,ifaNominatedPersondoesnothavesucharight,ordoesnotwishtoexerciseit,theymayhavearightunderanysuchagreementtogiveinstructionstotheRelevantMemberastotheexerciseofvotingrights.

ANominatedPerson’smainpointofcontactintermsoftheirinvestmentintheCompanyremainstheRelevantMember(or,perhaps,theNominatedPerson’scustodianorbroker)andtheNominatedPersonshouldcontinuetocontactthem(andnottheCompany)regardinganychangesorqueriesrelatingtotheNominatedPerson’spersonaldetailsandtheirinterestintheCompany(includinganyadministrativematters).TheonlyexceptiontothisiswheretheCompanyexpresslyrequestsaresponsefromtheNominatedPerson.

81 Future plc


Appointment of proxies through CREST

9. CRESTmemberswhowishtoappointaproxyorproxiesthroughtheCRESTelectronicproxyappointmentservicemaydosoforthemeetingandanyadjournment(s)thereofbyusingtheproceduresdescribedintheCRESTManual.CRESTpersonalmembersorotherCRESTsponsoredmembers,andthoseCRESTmemberswhohaveappointedavotingserviceprovider(s),shouldrefertotheirCRESTsponsororvotingserviceprovider(s),whowillbeabletotaketheappropriateactionontheirbehalf.

InorderforaproxyappointmentorinstructionmadeusingtheCRESTservicetobevalid,theappropriateCRESTmessage(a‘CRESTProxyInstruction’)mustbeproperlyauthenticatedinaccordancewithEuroclearUK&IrelandLimited’sspecificationsandmustcontaintheinformationrequiredforsuchinstructions,asdescribedintheCRESTManual.Themessage,regardlessofwhetheritconstitutestheappointmentofaproxyoranamendmenttotheinstructiongiventoapreviouslyappointedproxymust,inordertobevalid,betransmittedsoastobereceivedbytheissuer’sagent(ID3RA50)by10:30amonMonday30January2017or,ifthemeetingisadjourned,notlessthan48hoursbeforethetimefixedfortheadjournedmeeting.Forthispurpose,thetimeofreceiptwillbetakentobethetime(asdeterminedbythetimestampappliedtothemessagebytheCRESTApplicationsHost)fromwhichtheissuer’sagentisabletoretrievethemessagebyenquirytoCRESTinthemannerprescribedbyCREST.AfterthistimeanychangeofinstructionstoproxiesappointedthroughCRESTshouldbecommunicatedtotheappointeethroughothermeans.

CRESTmembersand,whereapplicable,theirCRESTsponsorsorvotingserviceprovidersshouldnotethatEuroclearUK&IrelandLimiteddoesnotmakeavailablespecialproceduresinCRESTforanyparticularmessages.NormalsystemtimingsandlimitationswillthereforeapplyinrelationtotheinputofCRESTProxyInstructions.ItistheresponsibilityoftheCRESTmemberconcernedtotake(or,iftheCRESTmemberisaCRESTpersonalmemberorsponsoredmemberorhasappointedavotingserviceprovider(s),toprocurethathisCRESTsponsororvotingserviceprovider(s)take(s))suchactionasshallbenecessarytoensurethata

messageistransmittedbymeansoftheCRESTsystembyanyparticulartime.Inthisconnection,CRESTmembersand,whereapplicable,theirCRESTsponsorsorvotingserviceprovidersarereferred,inparticular,tothosesectionsoftheCRESTManualconcerningpracticallimitationsoftheCRESTsystemandtimings. TheCompanymaytreatasinvalidaCRESTProxyInstructioninthecircumstancessetoutinRegulation35(5)(a)oftheUncertificatedSecuritiesRegulations2001.

Amending a proxy

10.Tochangeaproxyinstruction,amemberneedstosubmitanewproxyappointmentusingthemethodssetoutabove.Notethatthedeadlinesforreceiptofproxyappointments(seeabove)alsoapplyinrelationtoamendedinstructions;anyamendedproxyappointmentreceivedaftertherelevantdeadlinewillbedisregarded.Whereamemberhasappointedaproxyusingthepaperproxyformandwouldliketochangetheinstructionsusinganothersuchform,thatmembershouldcontacttheRegistrarson+44(0)3707071443.

Ifmorethanonevalidproxyappointment

issubmitted,theappointmentreceivedlastbeforethedeadlineforthereceiptofproxieswilltakeprecedence.

Revoking a proxy

11.Inordertorevokeaproxyinstruction,asignedletterclearlystatingamember’sintentiontorevokeaproxyappointmentmustbesentbypostorbyhandtotheCompany’sRegistrars:

ComputershareInvestorServicesPLC, ThePavilions,BridgwaterRoad, BristolBS996ZY. Notethatthedeadlinesforreceiptofproxyappointments(seeabove)alsoapplyinrelationtorevocations;anyrevocationreceivedaftertherelevantdeadlinewillbedisregarded.

Corporate members

12. Inthecaseofamemberwhichisacompany,anyproxyform,amendmentorrevocationmustbeexecutedunderitscommonsealorsignedonitsbehalfbyanofficerofthecompanyoranattorneyforthecompany.Anypowerofattorneyoranyotherauthorityunderwhichthedocumentsaresigned(oradulycertifiedcopyofsuchpowerofauthority)mustbeincluded.Acorporatemembercanappointoneormorecorporaterepresentativeswhomayexercise,onitsbehalf,allitspowersasamemberprovidedthatnomorethanonecorporaterepresentativeexercisespowersoverthesameshare.Membersconsideringtheappointmentofacorporaterepresentativeshouldchecktheirownlegalposition,theCompany’sarticlesofassociationandtherelevantprovisionoftheCompaniesAct2006.

Joint holders

13.Wheremorethanoneofthejointholderspurportstovoteorappointaproxy,onlythevoteorappointmentsubmittedbythememberwhosenameappearsfirstontheregisterwillbeaccepted.

Questions at the AGM

14. Undersection319AoftheAct,theCompanymustansweranyquestionyouaskrelatingtothebusinessbeingdealtwithatthemeetingunless:

(a) answeringthequestionwouldinterfereundulywiththepreparationforthemeetingorinvolvethedisclosureofconfidentialinformation;

(b) theanswerhasalreadybeengivenonawebsiteintheformofananswertoaquestion;or

(c) itisundesirableintheinterestsoftheCompanyorthegoodorderofthemeetingthatthequestionbeanswered.

82AnnualReportandAccounts2016Financial Statem

ents

Members’ right to require circulation of a resolution to be proposed at the AGM

15. Undersection338oftheAct,amemberormembersmeetingthequalificationcriteriasetoutatnote18below,may,subjecttoconditionssetoutatnote19,requiretheCompanytogivetomembersnoticeofaresolutionwhichmayproperlybemovedandisintendedtobemovedatthatmeeting.

Members’ right to have a matter of business dealt with at the AGM

16.Undersection338AoftheAct,amemberormembersmeetingthequalificationcriteriasetoutatnote18below,may,subjecttotheconditionssetoutatnote19,requiretheCompanytoincludeinthebusinesstobedealtwithattheAGMamatter(otherthanaproposedresolution)whichmayproperlybeincludedinthebusiness(amatterofbusiness).

Website publication of any audit concerns

17. PursuanttoChapter5ofPart16oftheAct,whererequestedbyamemberormembersmeetingthequalificationcriteriasetoutatnote18below,theCompanymustpublishonitswebsiteastatementsettingoutanymatterthatsuchmembersproposetoraiseattheAGMrelatingtotheauditoftheCompany’saccounts(includingtheauditors’reportandtheconductoftheaudit)thataretobelaidbeforetheAGM.

WheretheCompanyisrequiredtopublish

suchastatementonitswebsite:

(a) itmaynotrequirethemembersmakingtherequesttopayanyexpensesincurredbytheCompanyincomplyingwiththerequest;

(b) itmustforwardthestatementtotheCompany’sauditorsnolaterthanthetimethestatementismadeavailableontheCompany’swebsite;and

(c) thestatementmaybedealtwithaspartofthebusinessoftheAGM.

Therequest:

(d) maybeinhardcopyformorinelectronicformandmustbeauthenticatedbythepersonorpersonsmakingit(seenote19(d)and(e)below);

(e) shouldeithersetoutthestatementinfullor,ifsupportingastatementsentbyanothermember,clearlyidentifythestatementwhichisbeingsupported;and

(f) mustbereceivedbytheCompanyatleastoneweekbeforetheAGM.

Members’ qualification criteria

18.Inordertobeabletoexercisethemembers’rightssetoutinnotes15to17abovetherelevantrequestmustbemadeby:

(a) amemberormembershavingarighttovoteattheAGMandholdingatleast5%oftotalvotingrightsoftheCompany;or

(b) atleast100membershavingarighttovoteattheAGMandholding,onaverage,atleast£100ofpaidupsharecapital.

Conditions

19. Theconditionsarethat:

(a) anyresolutionmustnot,ifpassed,beineffective(whetherbyreasonofinconsistencywithanyenactmentortheCompany’sconstitutionorotherwise);

(b) theresolutionormatterofbusinessmustnotbedefamatoryofanyperson,frivolousorvexatious;

(c) therequest:

(i) maybeinhardcopyformorin electronicform;

(ii) mustidentifytheresolutionorthematter ofbusinessofwhichnoticeistobegivenbyeithersettingitoutinfullor,ifsupportingaresolution/matterofbusinesssentbyanothermember,clearlyidentifyingtheresolution/matterofbusinesswhichisbeingsupported;

(iii)inthecaseofaresolution,mustbeaccompaniedbyastatementsettingoutthegroundsfortherequest;

(iv)mustbeauthenticatedbythepersonorpersonsmakingit;and

(v) mustbereceivedbytheCompanynotlaterthansixweeksbeforethedateoftheAGM;

(d) inthecaseofarequestmadeinhardcopyform,suchrequestmustbe:

(i) signedbyyouandstateyourfullnameandaddress;and

(ii) senteither:bypostto

CompanySecretary, Futureplc, QuayHouse, TheAmbury, BathBA11UA;

orbyfaxto+44(0)1225732266

markedfortheattentionoftheCompanySecretary;and

(e) inthecaseofarequestmadeinelectronic

form,suchrequestmust:

(i) stateyourfullnameandaddress;and

(ii) [email protected].

Pleasestate‘AGM’inthesubjectlineoftheemail.YoumaynotusethiselectronicaddresstocommunicatewiththeCompanyforanyotherpurpose.

83 Future plc



Investor information

Registrar and transfer office

TheCompany’sshareregisterismaintainedby:

ComputershareInvestorServicesPLCThePavilionsBridgwaterRoadBristol BS138AETel:+44(0)3707071443

ShareholdersshouldcontacttheRegistrar,Computershare,inconnectionwithchangesofaddress,lostsharecertificates,transfersofsharesandbankmandateformstoenableautomatedpaymentofdividends.

Online information – www.investorcentre.co.uk

OurRegistrar,Computershare,hasaservicetoprovideshareholderswithonlineinternetaccesstodetailsoftheirshareholdings. Theserviceisfree,secureandeasytouse. Toregisterfortheservice,gotowww.investorcentre.co.uk.

Unsolicited mail

Theshareregisterisbylawapublicdocument.Tolimitthereceiptofmailfromotherorganisations,pleaseregisterwiththeMailingPreferenceService,byvisitingwww.mpsonline.org.uk/mpsr/.

Warning to shareholders – ‘boiler room’ scams

Inrecentyears,manycompanieshavebecomeawarethattheirshareholdershavereceivedunsolicitedphonecallsorcorrespondenceconcerninginvestmentmatters.Thesearetypicallyfromoverseas-based‘brokers’whotargetUKshareholders,offeringtosellthemwhatoftenturnouttobeworthlessorhigh-risksharesinUSorUKinvestments.Theseoperationsarecommonlyknownas‘boilerrooms’.These‘brokers’canbeverypersistentandextremelypersuasive.

Itisnotjustthenoviceinvestorthathasbeendupedinthisway;manyofthevictimshadbeensuccessfullyinvestingforseveralyears.Shareholdersareadvisedtobeverywaryofanyunsolicitedadvice,offerstobuysharesatadiscountoroffersoffreecompanyreports.Ifyoureceiveanyunsolicitedinvestmentadvice:

• Makesureyougetthecorrectnameofthepersonandorganisation

• CheckthattheyareproperlyauthorisedbytheFCAbeforegettinginvolvedbyvisiting www.fca.org.uk/register

• ReportthemattertotheFCAeitherbycalling0800 111 6768 orbycompletingthefraudreportingformontheFCAwebsiteat:www.fca.org.uk/consumers/scams/investment-scams/share-fraud-and-boiler-room-scams/reporting-form

• Ifthecallspersist,hangup.

Ifyoudealwithanunauthorisedfirm,youwillnotbeeligibletoreceivepaymentundertheFinancialServicesCompensationScheme.

DetailsofanysharedealingfacilitiesthattheCompanyendorseswillbeincludedincompanymailings.

Moredetailedinformationonthisorsimilaractivitycanbefoundat www.moneyadviceservice.org.uk.

For enquiries of a general nature regarding the Company and for investor relations enquiries please contact Penny Ladkin-Brand at the Company’s Registered Office, or visit www.futureplc.com and select the investor relations section.

Registered office

FutureplcQuayHouseTheAmburyBathBA11UA

Tel+44(0)1225442244

www.futureplc.com/invest-in-future

i


Directors and advisers

Directors


James HanburyDeputyChairman


Penny Ladkin-BrandChiefFinancialOfficerandCompanySecretary

Manjit WolstenholmeSeniorindependentnon-executiveDirector

Hugo DraytonIndependentnon-executiveDirector

Offices

Registered officeFutureplcQuayHouseTheAmburyBathBA11UATel+44(0)1225442244

London office1-10PraedMewsLondon W21QYTel+44(0)2070424000

Leamington officeFirstfloorUnit4,JephsonCourtTancredCloseLeamingtonSpaCV313RZTel+44(0)1225442244

www.futureplc.com

Companyregistrationnumber3757874RegisteredinEnglandandWales

Advisers

Independent auditorsPricewaterhouseCoopersLLPCharteredaccountantsandstatutoryauditors2GlassWharfBristolBS20FR

BrokerNumisSecuritiesLtd10PaternosterSquareLondon EC4M7LT

Principal bankersHSBCBankplc8CanadaSquareLondonE145HQ

Registrar ComputershareInvestorServicesPLCThePavilionsBridgwaterRoadBristol BS138AE

Financial calendar

Announcement of annual results 23November2016

Annual General Meeting1February2017

Half-year end31March2017

Announcement of interim resultsMay2017

Financial year-end30September2017

85 Future plc


Future plc and Future Publishing LtdRegistered officeQuayHouseTheAmburyBathBA11UA

Tel+44(0)1225442244

Future US, Inc.1LombardStreetSuite200SanFranciscoCA94111USA

Tel+16502382400

www.futureplc.com

London office1-10PraedMewsLondon W21QY

Tel+44(0)2070424000

Future Publishing (Overseas) LtdSuite3,Level10100WalkerStreetNorthSydneyNSW 2060Australia

Tel+61299552677

Leamington officeFirstfloorUnit4,JephsonCourtTancredCloseLeamingtonSpaCV313RZ

Tel+44(0)1225442244

Contacts
