16th Feb 2007 07:01
Go-Ahead Group PLC16 February 2007 THE GO-AHEAD GROUP PLC ("Go-Ahead" or "the group") Interim Results for the half year ended 30 December 2006 Go-Ahead is one of the UK's leading providers of passenger transport managementservices operating in the bus, rail and aviation sectors. Employing over 24,000staff across the country, over 800 million passenger journeys are undertaken onits services each year. In addition to the travelling public, customers includeTransport for London, BAA, major airlines, local authorities and the Departmentfor Transport. HIGHLIGHTS • Revenue increased by 35% to £915.2 million (2005 - £675.9 million) • Profit before amortisation, exceptional items and tax rose 17% to £50.9 million (2005 - £43.6 million) • Operating profit before amortisation and exceptionals increased by 19% to £55.2 million (2005-£46.3 million) • Adjusted earnings per share were up 19% to 66.9p (2005 - 56.1p) • Interim dividend of 23p per share (2005 - 18p) is proposed, an increase of 28% • Demand growth and cost control in bus and rail were the key factors • Acquisition of Docklands Minibuses Limited in north-east London and Marchwood Buses in Southampton • Shortlisted for the TfL London Rail Concession and West Midlands rail franchises • Exclusive discussions with Air Canada at Heathrow • Share buy-back programme continuing Commenting on Go-Ahead's strategy and prospects, Chairman, Sir Patrick Brownsaid: "The outlook for the second half of the year remains positive with expectedincreases in bus profitability sustained by a combination of margin improvement,revenue growth and contributions from new acquisitions. The main focus in railcontinues to be the business improvement programme at Southeastern and thedevelopment of competitive bids for the two franchises for which we areshortlisted. The performance of the aviation services division is expected to recover in the next financial year as the benefits from this year's commercial developmentsare secured. In the early weeks of 2007, the group's trading is in line withthese expectations." For further information, please contact: The Go-Ahead GroupKeith Ludeman, Group Chief Executive 16 February:0207 067 0700Ian Butcher, Group Finance Director Thereafter :0208 929 8650/ 0191 232 3123 Weber Shandwick Financial 020 7067 0700Richard Hews/ Rachel Taylor/ Hannah Marwood An analyst's presentation will be held at 9.30am at Weber Shandwick Financial's offices, Fox Court, 14 Gray's Inn Road, London, WC1X 8WS. Copies of the presentation will be available on the Company's website: www.go-ahead.com. Notes to Editors BUSThe group's bus division operates over 3,600 buses, providing over 505 millionpassenger journeys and covering around 236 million vehicle kilometres each year.Operations fall into four main geographical areas: deregulated services in northeast; deregulated services in West Midlands; deregulated services in south east/ southern England; and regulated services for Transport for London in thecapital. The newest additions to this division are Dockland Minibuses andMarchwood buses acquired during the half year. RAILThe group's rail division operates a fleet of 630 trains on which over 280million passenger journeys are undertaken. Concentrated in the south east ofEngland both our franchises, Southern and Southeastern, operate a mix ofsuburban commuter and mainline routes throughout south London, Kent, Surrey andSussex. The Southeastern franchise will include the operation of new high speedtrains on the domestic Channel Tunnel Rail Link into St Pancras from 2009. AVIATION SERVICESThe group's aviation services division undertakes a wide range of supportservices for national and international airlines. Services provided includecargo handling, passenger check-in, baggage handling, information desks,executive lounges, ground handling and customs clearance. In the last year 45million passengers were handled as well as over half a million aircraftmovements. The division includes Meteor Parking which is the second largestparking company in the UK, managing over 58,000 parking spaces predominantly atBAA airports, with a range of customers, including BAA, local authorities,retail outlets, NHS trusts, hotels and rail stations. Well known brands include'Pink Elephant', 'Park 1' and 'eparking'. CHAIRMAN'S STATEMENT SUMMARY For the six months to 30 December 2006 revenue increased to £915.2 million (2005- £675.9 million). Profit before amortisation, exceptional items and tax was£50.9 million (2005 - £43.6 million). Adjusted earnings per share increased by19% to 66.9p (2005 - 56.1p). The board is declaring an interim dividend of 23pper share (2005 - 18p), an increase of 28%. The board confirms its intention topropose dividends for the year to be covered two times by adjusted earnings. Theinterim dividend will be payable on 12 April 2007 to shareholders on theregister at close of business on 23 March 2007. Operating profit before amortisation and exceptional items was £55.2 million(2005 - £46.3 million). A strong performance in our bus and rail divisionsdelivered this 19% improvement. Demand growth, continuing quality improvementsand falling diesel and other costs in both bus and rail divisions were the keyfactors, together with the first full contribution from the Southeastern railfranchise. Aviation services lost the positive momentum of last year followingthe significant disruption caused by the terrorist threat in August and adverseweather conditions towards the end of 2006. The group's successful strategy remains unchanged across all areas of activity.Two acquisitions were completed in bus and one in aviation car parking, whilstthe group was shortlisted with one other bidder in each case for both theTransport for London ("TfL") London Rail Concession and West Midlands railfranchises. The aviation services division is now in exclusive discussions with Air Canada regarding aviance undertaking certain of their ground handling operations at Heathrow. DIVISIONAL REVIEW Operating Result The figures below are stated before exceptional items, goodwill and intangibleasset amortisation and after absorbing all central costs: Six months to 30 Dec 06 Six months to 31 Dec 05 Year to 1 July 06 _______________________________________________________________________________ Revenue Operating Margin Revenue Operating Margin Revenue Operating Margin £m Profit % £m Profit % £m Profit % £m £m £m Bus 253 29.2 11.5 224 23.0 10.3 460 46.7 10.2Rail 540 25.6 4.7 315 19.6 6.2 745 42.5 5.7Aviationservices 122 0.4 0.3 137 3.7 2.7 259 8.6 3.3 ____________ __________ ______________ 915 55.2 6.0 676 46.3 6.8 1,464 97.8 6.7 ____________ __________ ______________ Bus In the second half of the last financial year, there was a modest increase inpercentage margins (excluding the impact of acquisitions), the first in almostthree years. We indicated in our preliminary announcement that we expected thistrend of margin progression to continue, despite the high fuel price, because ofthe actions we had taken during the year to June 2006. I am pleased to reportthat we have, indeed, succeeded in increasing margins to 11.5% from 10.3% in theequivalent period last year and from 10.9% in the second half of last year,excluding acquisitions. The cost of fuel has reduced and, as a consequence ofthis and continued progress in our operating strategies, we believe margins willrise again during the second half. In the six months, the division has seen considerable growth in all its markets.In the deregulated bus sector, passenger numbers have increased by 11.4% on alike for like basis compared to the first half last year. This growth has beensupported by the enhanced concessionary fares schemes introduced in England inApril 2006 to provide free travel for the disabled, and those over 60 withinlocal authority areas. Although these schemes do not fully compensate operatorsfor the equivalent full fare, they are generally designed to provide a fairreturn on the capital deployed to carry these passengers. Excluding this factor,we have enjoyed underlying passenger growth of around 2.4%. We believe much ofthis growth has been driven by the recent network design and marketinginitiatives we have implemented, which have boosted demand whilst reducingcosts. In London, as anticipated in last year's report, various contract gains havehelped to boost mileage operated by 7.6% during the period. This growth iscontinuing, including the extra work awarded to cater for the western extensionof the congestion zone. Our London operations provide the best quality ofservice of any operator in the city and quality incentive bonuses continue toincrease. During the period these amounted to £6.8 million (2005 - £5.8million). The London businesses have also achieved improved labour efficiencyand other cost benefits from initiatives started last year across the group. Divisional results will improve further as the West Midlands operation evolvesits strategy to offer a quality alternative provider of bus services in andaround Birmingham. The half year has seen a continuation of the costs involvedin revitalising its fleet ahead of a re-launch of services planned for the endof the second half of the financial year. As well as developing the new operations in Birmingham, the group also enteredthe north-east London bus market with the acquisition of Docklands MinibusesLimited. This business operates TfL contracts from a depot north of the river,close to the Stratford Olympic area. The group also consolidated its position inthe Southampton market with the acquisition of Marchwood Buses. Thesedevelopments will support the division's growth prospects. Rail The group's rail businesses have continued to improve, helped by volume growthin both franchises. In Southeastern, much of the initial planned restructuringwork has been completed, generating significant cost and operational benefits.Southeastern saw growth of passenger journeys compared to the equivalent periodlast year of 7.1% whilst Southern grew at an even higher level of 9.9%. Theimproving performance in Southeastern meant that, by the end of the half year,the rate of growth was matching Southern's increase. Southeastern's result also benefited because the extra operating costs needed todeliver franchise commitments were slower in building than had been assumed inthe original business plan. These costs are expected to be caught up in thesecond half. Other dampening factors in the second half will be potential costincreases in the last quarter, particularly in relation to traction electricitycosts, and the fact that the profit share percentage going from Southern to theDepartment for Transport ("DfT") could rise to a marginal rate of 80%. We reported at the time of the group's AGM that the annualised cost of thepotential increase in electricity charges could be £16 million withoutmitigation (down from the previously reported figure of £21 million). Whilst nofirm agreement has yet been reached with the various agencies involved, it ishoped that an arrangement will be established to smooth the application of thissevere increase over a number of years, particularly given the recent sharp fallin energy prices. Efficiency benefits through regenerative braking and drivertraining are also being pursued. The group's focused bidding strategy produced two successes, with theannouncements that Govia has been selected for the best and final offer stage ofthe TfL London Rail Concession and also shortlisted for the targeted WestMidlands franchise. This success will, however, require increased bidding costsin the second half of the year. Aviation Services The six months has proved a difficult period for the division as a whole. Wereported at the last full year that market conditions reflected a slowing ofairline and cargo growth. The terrorist threat, also reported in last year'sannouncement, had a more severe and sustained impact than we expected. Thesefactors have not only depressed the division's revenue but also put significantupward pressure on costs where the standard IATA contracts, on which ourrelationships with customers are often based, provide little opportunity forcompensation. As well as passenger handling activity, cargo volume was put underpressure when cabin baggage restrictions almost doubled the amount of passengerbaggage being placed in aircraft holds. Weather related disruption in Decemberalso reduced volumes across the division, and the unusually warm autumn andwinter weather reduced de-icing activity. Aircraft turnarounds were down on lastyear by 12.8%, whilst cargo tonnage was up by 5.3%. Despite these difficulties, the core aviation services business continued todeliver high levels of quality in its operating performance and the division'sreputation, particularly for handling full service customers, continues to grow.As indicated at the end of last year, this provides a platform for commercialdevelopment, the Air Canada discussions being the latest example. This, and other developments, will start to have a positive impact on financial performance in the next financial year. Car parking delivered a result below expectations as a consequence of the costof developing new operations. We took some significant steps to expand the "offairport" product, with a number of new start ups and the acquisition of PASDirect at Gatwick Airport. The business also won the mandate to operate thegroup's Southeastern rail franchise car park estate, to start in the second halfof the year. These developments are expected to deliver benefits principally innext year's financial performance. ADDITIONAL FINANCIAL MATTERS Pensions A significant feature of the half has been the reduction in the group's pensiondeficit. Overall this has reduced from £103.8 million at the end of last year to£84.6 million. This is mainly as a consequence of investment out performancecompared to the IAS 19 actuarial assumption. Under IAS 19, this benefit isreflected in the consolidated statement of recognised income and expenses ratherthan the profit and loss account. Taxation We have sustained a continuing low effective rate of tax. If prior year itemsare excluded, the rate shows a reduction to 24.9% from 25.7% in the lastfinancial year. The principal reason for the low tax rate continues to beeffective management of the group's asset finance arrangements. The majority ofthe tax charge is represented by deferred tax movements, the cash outflow beingparticularly low. GROUP CASH FLOW AND NET DEBT Cash inflow from operations amounted to £77.8 million (2005 - £69.6 million),reflecting the increase in the group's profitability. Capital expenditure in thehalf amounted to £23.9 million (2005 - £29.5 million), though this will rise inthe second half as the group continues to invest in its fleet and equipment. Thegroup's share buy back programme continued in the half with a total of 785,000(2005 - 1,227,500) shares being bought at a cost of £14.6 million (2005 - £17.1million) at an average price per share of £18.20 (2005 - £13.90). Excluding restricted cash, period end debt was £215 million (2005 - £166million). The group has adequate capacity to continue buying back shares to theauthority level provided by the shareholders at the last AGM of 4.5 millionshares. To date, 591,000 shares have been purchased and cancelled under thisauthority. PROSPECTS The outlook for the second half of the year remains positive with expectedincreases in bus profitability sustained by a combination of margin improvement,revenue growth and contributions from new acquisitions. The main focus in railcontinues to be the business improvement programme at Southeastern and thedevelopment of competitive bids for the two franchises for which we areshortlisted. The performance of the aviation services division is expected torecover in the next financial year as the benefits from this year's commercialdevelopments are secured. In the early weeks of 2007, the group's trading is inline with these expectations. Sir Patrick BrownChairman 15 February 2007 CONSOLIDATED INCOME STATEMENTfor the six months ended 30 December 2006 Six months to Six months to Year to 1 30 Dec 06 31 Dec 05 Jul 06 Notes £m £m £m Unaudited Unaudited Audited Group Revenue 2 915.2 675.9 1,463.6 Operating costs (excluding amortisation and exceptional items) (860.0) (629.6) (1,365.8) __________ __________ _________Group operating profit (before amortisation and exceptional items) 55.2 46.3 97.8Goodwill and intangible amortisation (4.0) (2.3) (5.1)Exceptional items 3 - (0.3) (3.2) __________ __________ _________Group operating profit (after amortisation and exceptional items) 51.2 43.7 89.5 __________ __________ _________ Finance revenue 2.8 2.2 4.9Finance costs (7.1) (4.9) (10.8) __________ __________ _________Profit on ordinary activities before taxation 46.9 41.0 83.6 Analysed as: __________ __________ _________ Before amortisation and exceptional items 50.9 43.6 91.9 Amortisation and exceptional items (4.0) (2.6) (8.3) __________ __________ _________ Tax expense 4 (11.7) (10.7) (19.4) __________ __________ _________Profit for the period from continuing operations 35.2 30.3 64.2 ========== ========== =========Attributable to: Equity holders of the parent 29.4 25.5 53.7 Minority interest 5.8 4.8 10.5 __________ __________ _________ 35.2 30.3 64.2 ========== ========== ========= Earnings per share from continuing operations - basic 5 61.6p 51.0p 108.1p - diluted 5 61.2p 50.4p 107.0p - adjusted 5 66.9p 56.1p 118.4p Dividend paid (pence per share) 7 38.0p 33.0p 51.0pDividend proposed (pence per share) 7 23.0p 18.0p 38.0p CONSOLIDATED BALANCE SHEETas at 30 December 2006 30 Dec 06 31 Dec 05 1 Jul 06 £m £m £m Unaudited Unaudited AuditedASSETSNon-current assetsProperty, plant and equipment 429.0 363.8 425.2Intangible assets 121.7 79.8 118.8Trade and other receivables 1.2 4.1 1.7Deferred tax assets 24.8 35.2 32.2 __________ __________ _________ 576.7 482.9 577.9 __________ __________ _________Current assetsInventories 9.5 6.7 10.0Trade and other receivables 189.1 134.1 179.3Cash and short-term deposits 95.3 111.0 90.2Other financial assets - 0.3 - __________ __________ _________ 293.9 252.1 279.5 Assets classified as held for sale 3.3 2.2 0.3 __________ __________ _________TOTAL ASSETS 873.9 737.2 857.7 __________ __________ _________LIABILITIES Current liabilitiesTrade and other payables (356.7) (276.8) (337.1)Interest-bearing loans and borrowings (45.6) (109.6) (61.9)Current tax liabilities (7.7) (12.5) (6.6)Other financial liabilities (1.3) - - __________ __________ _________ (411.3) (398.9) (405.6)Non-current liabilitiesInterest-bearing loans and borrowings (187.5) (73.0) (167.1)Retirement benefit obligations (84.6) (113.4) (103.8)Deferred tax liabilities (64.7) (47.3) (57.6)Provisions - - (8.0)Other liabilities (3.2) (3.0) (6.1) __________ __________ _________ (340.0) (236.7) (342.6) Liabilities directly associated with assets classified as held for sale - (0.2) (0.2) __________ __________ _________TOTAL LIABILITIES (751.3) (635.8) (748.4) __________ __________ _________NET ASSETS 122.6 101.4 109.3 ========== ========== =========CAPITAL & RESERVESCalled up share capital 65.6 62.3 65.6Reserve for own shares (80.4) (31.6) (67.1)Hedging reserve (1.3) 0.2 -Revaluation reserve 12.4 - 12.4Other reserves 1.6 0.6 1.6Retained earnings 117.5 58.9 93.1 __________ __________ _________Total shareholders' equity 115.4 90.4 105.6 Minority interest 7.2 11.0 3.7 __________ __________ _________TOTAL EQUITY 122.6 101.4 109.3 ========== ========== ========= CONSOLIDATED CASH FLOW STATEMENTfor the six months ended 30 December 2006 Six months to Six months to Year to 30 Dec 06 31 Dec 05 1 Jul 06 Notes £m £m £m Unaudited Unaudited Audited Group operating profit (after amortisation and exceptional items) 51.2 43.7 89.5 Depreciation of property, plant and equipment 22.4 18.1 38.0Amortisation of goodwill and intangible assets 4.0 2.2 5.1Profit on sale of property, plant and equipment (0.3) (1.0) (1.3)Share based payments 0.6 0.3 0.7Difference between pension contributions paid and amounts recognised in income statement 1.3 2.4 5.4Decrease/(increase)/ in inventories 0.5 (0.3) 0.5(Increase)/decrease in trade and other receivables (16.2) 11.8 (31.6)Increase/(decrease) in trade and other payables 14.4 (7.6) 10.6 _________ _________ _________Cash flow generated from operations 77.9 69.6 116.9Taxation paid (2.4) (5.0) (15.3)Net receipt on transfer of rail franchises - - 7.9 _________ _________ _________Net cash flows from operating activities 75.5 64.6 109.5 _________ _________ _________ Cash flows from investing activitiesInterest received 2.4 2.0 5.2Proceeds from sale of property, plant and equipment 1.1 2.9 3.0Purchase of property, plant and equipment (23.4) (29.5) (70.9)Acquisition of intangible assets - (0.8) (3.5)Purchase of businesses 8 (8.3) (2.9) (11.6)Cash acquired with subsidiaries (1.0) (0.1) 0.9 _________ _________ _________Net cash flows used in investing activities (29.2) (28.4) (76.9) _________ _________ _________Cash flows from financing activitiesInterest paid (6.9) (4.9) (10.6)Dividends paid to members of the parent 7 (18.1) (16.4) (25.3)Dividends paid to minority interests (3.3) (2.5) (15.1)Proceeds from issue of shares - 0.1 4.3Shares purchased (14.6) (17.1) (52.6)Repayment of borrowings (125.6) (3.7) (81.5)Proceeds from borrowings 144.2 34.1 147.3Proceeds from finance lease and hire purchase - 9.3 13.5Payment of finance lease and hire purchase liabilities (9.1) (14.7) (18.4)Repayment of loan notes - - (0.1)Receipts from hedging activities - 0.3 - _________ _________ _________Net cash outflows on financing activities (33.4) (15.5) (38.5) _________ _________ _________Net increase/(decrease) in cash and cash equivalents 12.9 20.7 (5.9) Cash and cash equivalents at 1 July 2006 80.4 86.3 86.3 _________ _________ _________Cash and cash equivalents at 30 December 2006 6 93.3 107.0 80.4 ========= ========= ========= CONSOLIDATED STATEMENT OF RECOGNISED INCOME AND EXPENSEfor the six months ended 30 December 2006 Six months to Six months to Year to 30 Dec 06 31 Dec 05 1 Jul 06 £m £m £m Unaudited Unaudited Audited Income and expense recognised directly in equity Actuarial gains/(losses) on defined benefit pension plans 20.4 (10.8) 16.9Revaluation of land and buildings - - 12.4Share based payments 0.6 0.6 0.7Losses on cash flow hedges (1.7) - -Tax recognised directly in equity (5.7) 3.4 (6.5) _________ _________ _________Net income/(expense) recognised directly in equity 13.6 (6.8) 23.5 TransfersTransferred to profit on cash flow hedges 0.4 - - Profit for the period 35.2 30.3 64.2 _________ _________ _________Total recognised income and expense for the period 49.2 23.5 87.7 ========= ========= =========Attributable to: Equity holders of the parent 42.5 18.5 77.5 Minority interest 6.7 5.0 10.2 _________ _________ _________ 49.2 23.5 87.7 ========= ========= ========= NOTES TO THE INTERIM REPORTfor the six months ended 30 December 2006 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The accounting policies used in the preparation of these interim financialstatements are as disclosed in the 2006 Annual Review. The group has chosen notto adopt IAS 34 'Interim Financial Statements' in preparing these financialstatements. 2. SegmentAL Analysis Business segmentsThe following table presents revenue and profit information regarding thegroup's business segments for the periods stated. Six months Six months Year to to 30 Dec 06 to 31 Dec 05 1 Jul 06 £m £m £m £m £m £m Unaudited Unaudited Unaudited Unaudited Audited Audited Revenue Operating* Revenue Operating* Revenue Operating* profit profit profitBus 259.5 29.2 224.6 23.0 474.6 46.7Rail 540.9 25.6 315.3 19.6 748.5 42.5Aviation services 123.6 0.4 138.7 3.7 263.7 8.6Inter-segment revenue (8.8) - (2.7) - (23.2) - ________ ________ ________ _________ ________ ________ 915.2 55.2 675.9 46.3 1,463.6 97.8Goodwill and intangible amortisation (4.0) (2.3) (5.1)Exceptional items - (0.3) (3.2) ________ _________ ________Operating profit (after amortisation and exceptional items) 51.2 43.7 89.5Net finance costs (4.3) (2.7) (5.9) ________ _________ ________ Profit before tax and minority interest 46.9 41.0 83.6Tax expense (11.7) (10.7) (19.4) ________ _________ ________Profit for the period 35.2 30.3 64.2 ======== ========= ======== * Operating profit before amortisation and exceptional items 3. EXCEPTIONAL ITEMS Six months Six months Year to to 30 Dec 06 to 31 Dec 05 1 July 06 £m £m £m Unaudited Unaudited Audited Profit on sale of properties - 0.7 1.2Property relocation costs - - (0.6)Redundancy and reorganisation costs - (1.0) (3.8) __________________________________________________ - (0.3) (3.2) ================================================== 4. Taxation Income statement Six months Six months Year to to to 1 July 30 Dec 06 31 Dec 05 06 £m £m £m Unaudited Unaudited AuditedCurrent tax charge 3.6 10.5 19.2Adjustment in respect of current tax of previous years - - (1.3) _________________________________________________ 3.6 10.5 17.9 _________________________________________________Deferred tax relating to origination and reversal of temporary differences 8.1 0.2 2.2Previously unrecognised deferred tax of a prior period - - (0.7) _________________________________________________Tax reported in consolidated income statement 11.7 10.7 19.4 ================================================= 5. EARNINGS PER SHARE Basic earnings per share Six months Six months Year to 30 Dec 06 31 Dec 05 1 July 06 Unaudited Unaudited AuditedNet Profit attributable to shareholders (£million) 29.4 25.5 53.7Weighted average number of shares in issue (thousands) 47,707 49,921 49,674 _________ __________ __________Basic earnings per share (pence per share) 61.6 51.0 108.1 _________ __________ __________ The weighted average number of shares in issue excludes treasury shares held bythe company, and shares held in trust for the directors' long term incentiveplan. Diluted earnings per share Six months Six months Year to 30 Dec 06 31 Dec 05 1 July 06 Unaudited Unaudited AuditedNet profit attributable to shareholders (£million) 29.4 25.5 53.7Weighted average number of shares in issue (thousands) 47,707 49,921 49,674 Effect of dilution: Dilutive potential ordinary shares under share option schemes (thousands) 337 639 491 ________ ________ ________Adjusted weighted average number of shares 48,044 50,560 50,165 ________ ________ ________ Diluted earnings per share (pence per share) 61.2 50.4 107.0 ________ ________ ________ The dilution calculation assumes conversion of all potentially dilutive ordinary shares. Adjusted earnings per share Adjusted earnings per share is also presented to eliminate the impact of goodwill and intangible amortisation and non-recurring exceptional costs and revenues in order to show a 'normalised' earnings per share. This is analysed as follows: Six months Six months Year to 30 Dec 06 31 Dec 05 1 July 06 £m £m £m Unaudited Unaudited AuditedNet profit attributable to equity holders of the parent 29.4 25.5 53.7Adjusted in respect of exceptional items - 0.3 3.2Adjusted in respect of amortisation of goodwill and intangible assets 4.0 2.3 5.1Adjustment in respect of minority interest element of the above (1.4) - (2.0)Adjustment in respect of taxation of the above (0.1) (0.1) (1.2) _________ _________ _________Adjusted profit attributable to equity holders of the parent 31.9 28.0 58.8 _________ _________ _________ Adjusted earnings per share (pence per share) 66.9 56.1 118.4 _________ _________ _________ 6. NET DEBT Analysis of group net debt Hire purchase/ Cash and Loans Loan notes finance leases cash equivalents Total £m £m £m £m £m1 July 2006 (170.5) (0.6) (48.1) 80.4 (138.8)Cash flow (18.6) - 9.1 11.9 2.4Non-cash movements (0.3) - 0.1 - (0.2)Acquisitions - - (2.2) 1.0 (1.2) _______ _______ _______ _______ _______30 December 2006 (189.4) (0.6) (41.1) 93.3 (137.8) _______ _______ _______ _______ _______ Cash and cash equivalents includes overdrafts amounting to £2.0 million (2005 - £4.0 million) and amounts held by rail companies which can be distributed subject to DfT dispensation, up to the value of revenue reserves. As at 30 December 2006, balances amounting to £76.9 million (2005 - £94.0 million) were restricted. 7. DIVIDENDS PAID AND PROPOSED Six months Six months Year to to 30 Dec 06 to 31 Dec 05 1 July 06 £m £m £m Unaudited Unaudited AuditedDeclared and paid during the periodEquity dividends on ordinary shares:Final dividend for 2006: 38p per share (2005 - 33p) 18.1 16.4 16.4Interim dividend for 2006: 18p per share - - 8.9 __________ __________ _________ 18.1 16.4 25.3 __________ __________ _________ Six months Six months Year to 30 Dec 06 31 Dec 05 1 July 06 £m £m £m Unaudited Unaudited AuditedDividend proposed (not recognised as a liability)Equity dividends on ordinary shares:Interim dividend for 2007: 23p per share (2006 - 18p) 10.8 8.9 18.8 __________ __________ _________ 8. ACQUISITIONS AND DISPOSALS Acquisition of Docklands Minibuses Limited On 18 September 2006, London General Transport Services Limited, a wholly ownedsubsidiary of the group, acquired Docklands Minibuses Limited, a smallindependent London bus operator, for a total cash consideration of £3.1 millionincluding expenses. Docklands Minibuses Limited will operate a fleet ofapproximately 30 vehicles on four TfL contracts. Docklands is a companyincorporated within the United Kingdom with a principal activity of buspassenger transport. Acquisition of Marchwood Buses On 24 October 2006, Solent Blue Line Limited, a wholly owned subsidiary of thegroup, acquired 100% of the share capital of Marchwood Motorways (Southampton)Limited and Marchwood Motorways (Services) Limited ("Marchwood Buses"), anindependent bus and coach operator in the Southampton conurbation, for a totalcash consideration of £3.7 million including expenses. Marchwood Buses operatesa fleet of approximately 51 vehicles and is a franchisee of Solent Blue LineLimited. Marchwood Motorways (Southampton) Limited and Marchwood Motorways(Services) Limited are companies incorporated within the United Kingdom with aprincipal activity of bus passenger transport. Acquisition of PAS On 21st December 2006, Meteor Parking Limited, a wholly owned subsidiary of thegroup, acquired 100% of the share capital of PAS Direct Limited and PAS GatwickLimited ("PAS"), providers of valet parking services at Gatwick airport, for atotal cash consideration of £1.5 million including expenses. PAS operates undertwo principal brands, PAS and Boomerang, and will be integrated with Meteor'sexisting valet parking business at Gatwick. PAS Direct Limited and PAS GatwickLimited are companies incorporated within the United Kingdom with a principalactivity of aviation services. The above acquisitions have been accounted for as acquisitions in accordancewith IFRS3. The acquisition balance sheets have been adjusted to reflectprovisional fair values. The contribution of the acquired business to the group's revenue and profit forthe six months has been immaterial. 9. Publication of non-statutory financial statements The financial information contained in this interim statement does notconstitute statutory accounts as defined in section 240 of the Companies Act1985. The results are unaudited but have been reviewed by the auditors. Thefinancial information for the year to 1 July 2006 and the six months ended 31December 2005 has been extracted from the group's 2006 Annual Review and the2005 interim report. The 2006 Annual Review has been filed with the Registrar ofCompanies. The audit report on the Annual Review 2006 was unqualified and didnot contain a statement under Section 237 (2) or (3), of the Companies Act 1985. This interim statement is being sent to all shareholders and is also availableupon request from the Company Secretary, The Go-Ahead Group plc, 3rd Floor,41-51 Grey Street, Newcastle upon Tyne, NE1 6EE or viewed at www.go-ahead.com. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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