4 September 2017
Victrex plc
Reduction in Group's effective tax rate under Patent Box
Victrex plc, an innovative world leader in high performance polymer solutions, today announces that, based on recently-granted UK patents and following discussions with Her Majesty's Revenue & Customs (HMRC) about the UK's Patent Box legislation1, we now expect our tax rate to be materially lower than previous guidance.
With a strong history of investing in research and development (R&D) and of patenting our Intellectual Property (IP), Victrex's strategy of moving downstream from Polymer to Parts, and further differentiating our business through product leadership, will continue to be supported by our approach to R&D investment, to innovation and IP protection.
Starting in the current financial year ending 30th September 20172, we anticipate the annualised impact of Patent Box to reduce the Group's effective tax rate from approximately 21% to around 12%, with an ongoing favourable impact on earnings per share (EPS) and cash, although no cash benefit would be seen in FY17.
At a trading level, Victrex continues to be comfortable with current expectations.
This announcement contains inside information.
Notes:
1 The UK's Patent Box legislation was introduced in April 2013. The UK government encourages high-value growth in UK plc through a competitive tax regime that supports UK R&D from conception to commercialisation. The Patent Box forms a key part of this strategy by encouraging companies to commercialise their patents and R&D in the UK
2 IFRS requires tax to be recognised on the most likely outcome. The directors consider the acceptance of Patent Box in the 2017 computations to be more likely than not, although as with all tax items, HMRC reserve the right to query the Company's calculations
Enquiries:
Victrex plc:
Andrew Hanson, Director of Investor Relations & Corporate Communications
+44 (0) 1253 898121
Louisa Burdett, Group Finance Director
+44 (0) 1253 897700
David Hummel, Chief Executive
+44 (0) 1253 897700
About Victrex:
Victrex is an innovative world leader in high performance polymer solutions, focused on the strategic markets of Automotive, Aerospace, Energy (including Manufacturing & Engineering), Electronics and Medical. Every day, millions of people rely on products or applications which contain our materials, from smartphones, aeroplanes and cars to oil & gas operations and medical devices. With over 35 years' experience, we develop world leading solutions in PEEK and PAEK-based polymers, semi-finished and finished parts which shape future performance for our customers and our markets, and drive value for our shareholders. Find out more at www.victrexplc.com
