FINANCIAL INFORMATION

• Rehab Group Finance
• 2010 Financial Statements

Rehab Group Finance

In 2010 the Rehab Group reported an operating surplus of €2.3 million, up from €1.9 million in 2009.

This surplus represents just 1 per cent of turnover. Turnover fell by 8 per cent to €187 million, from €202 million in 2009, which resulted from a drop in commercial activity combined with reductions in service funding. Further significant challenges are anticipated in 2011. Net cash at year-end was better than the previous year with a marked improvement in debtor days. The net cost of servicing debt was €300,000.

The Group has adopted Financial Reporting Standard 17 on Retirement Benefits and in 2010 the liability in respect of the defined benefit pension scheme increased by €630,000 to €23.4 million. In common with many similar schemes, the effect of the downturn in global equity markets in 2008 had a serious impact. In consultation with the members, steps were taken in 2010 to begin to address this significant deficit.

In Ireland commercial activities had a difficult year and in late 2009 the glass business was merged with another glass recycler to form a new joint venture company, Rehab Glassco. Its facilities in Naas underwent a considerable upgrade at the end of 2010 and we hope to see the benefits of this investment in 2011.

TBG Learning in the United Kingdom continued to perform very well, while funding cuts led to a drop in income for other Group services.

The Board and management of the Group are committed to maintaining a high standard of corporate governance. The internal audit function is now well established and the Board’s Audit Committee, chaired by Liam Hogan, oversaw the work plan for 2010 and formally approved the work plan for 2011.

As a not-for-profit organisation, resources are committed to services for people with disabilities and other socially-disadvantaged groups. As the organisation has over 3,500 staff, and with more than 43,000 people and their families benefiting from the services provided annually, the Group needs to create and hold reserves to support itself as an independent, viable undertaking.

Whereas it is the Group’s aim that its core services should be self-financing, some services are currently operating with deficits; in addition, the Group continues to invest in a capital programme.

Historically, the Group developed ancillary activities such as pools, lotteries and fundraising activities to ensure that these deficits are covered and contribute to the capital programme, and also to allow for unfunded innovation in certain service areas. Fundraising is a very competitive business and the Group continues to look at different ways of raising funds. Most of the Group’s fundraising is now event-driven rather than the traditional donation type.

The Group acknowledges with gratitude the contribution by the public authorities both in Ireland and in the United Kingdom to the development of its services. During the year the Group spent €6.2 million – compared with €6.3 million in 2009 – on capital expenditure, which was funded in part by way of capital grants from various agencies, from fundraising and from borrowings. Finally, movement in the €/£Stg exchange rate during the year had a positive impact on reserves and this, combined with the decrease in the defined pension scheme liability, the revaluation of tangible assets and the surplus for the year, increased the Group’s net assets to €59.4 million.

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The Rehab Group (Extracts from Consolidated Financial Statements)

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