Facebook’s UK arm slumps to loss

The social networking group’s London arm reported a pre-tax loss of £13.9m last year, against a £1.1m profit in 2010, accounts filed with Companies House showed.

The drop came as Facebook enjoyed estimated UK advertising sales of £175m last year, according to independent researchers Enders Analysis.

However, the accounts showed that the company’s UK bill for staff costs and wages went from £7.9m to £24.8m, even as its workforce edged up only from 81 to 90. That represents a bill of some £275,000 a head.

The increased staff costs included a £15m “share-based payment charge”, which is thought to cover employees’ income tax and national insurance on the Facebook shares they received before the company floated in New York in May.

The accounts showed the London office paid £238,317 in tax, down from £424,651 the previous year.

Facebook said that its local operations’ filings do “not necessarily present a full account of overall global financial performance”.

The glimpse into the company’s books emerged as Facebook’s troubled $104bn (£65bn) flotation faced renewed scrutiny after it emerged that it only disclosed more information about key parts of its business because US regulators pressed it to do so.

Correspondence between the Securities and Exchange Commission and Facebook and its lawyers show how regulators had to press the social network for more information on how it counted users, among other issues. It is not uncommon for the SEC to ask for more information from companies that are seeking to go public. Facebook declined to comment