26th Sep 2007 07:00
Kesa Electricals plc26 September 2007 26 September 2007 Statement of Results for the Six Months ended 31 July 2007 Financial Highlights • Group revenue increased by 6.1% to £2,044.2 million (2006: £1,925.9 million), by 7.2% in constant currency(1) and by 3.9% on a like for like basis. • Group retail profit(2) fell to £38.2 million (2006: £48.0 million). Underlying group retail profit(3) grew by 13.8% to £55.9 million. • Net capital expenditure and investment increased to £76.1 million from £57.0 million. • Cash generated from operations was £66.2 million (2006: £56.4 million). • Net debt on 31 July 2007 was £155.4 million, down from £240.9 million on 31 July 2006. • Basic earnings per share of 4.5 pence (2006: 5.2 pence). • First interim dividend increased by 7.7% to 3.5 pence per share. • After the period end, the acquisition of Menaje Del Hogar in Spain was completed for €100 million plus approximately €35 million of net debt. (1) Constant exchange rate of £1 = Euro 1.4777 (2) Retail profit is defined as total operating profit before the share of jointventure and associates' interest and taxation, the Demerger Award Plan chargeand valuation gains / losses on options to acquire minority interests. Thecomparative amounts have been restated to include the gains and losses on thedisposal of property, plant and equipment. (3) Underlying retail profit is calculated as follows: Six months Six months ended ended 31 July 2007 31 July 2006 £m £mReported retail profit 38.2 48.0Darty Box losses 7.4 0.6Start up losses 8.3 6.6Gains on surrender of leases 0.0 (6.1)Impact of Comet mezzanines 2.0 0.0 ------------ ------------Underlying retail profit 55.9 49.1 ------------ ------------ Jean-Noel Labroue, Chief Executive, commented: "I am pleased that all our businesses delivered good revenue performancesagainst the very strong comparatives of last year. Sales were helped by thecontinued high demand for new technologies, particularly flat screen televisionsand laptops, and increased sales of white goods. As anticipated we saw an easingof the negative mix effect on margin. "Although underlying retail profit improved, new developments across the groupimpacted our first half profitability but are central to our longer termsuccess. "Trading conditions for the second half of the year are uncertain, particularlyin the UK. As always, our full year performance is reliant on our key peaktrading period in the fourth quarter of the year and we will remain focused oncost control, cash and margin management and operational efficiencies. "I am delighted that we have completed the acquisition of Menaje Del Hogar whichprovides us with a solid platform for entry into the Spanish market." David Newlands, Chairman, commented: "I am satisfied with these results which represent solid performances from allour businesses. Whilst we saw a decline in reported retail profit, I am pleasedthat underlying retail profit grew by 13.8 per cent. "The strong cash generative nature of the group continues to allow us to investfor the future and has also enabled us again to increase the interim dividend,up 7.7 per cent to 3.5 pence per share." ENDS Enquiries Press:Kesa Electricals plcAnnabel Donaldson +44 (0) 20 7269 1400Guy Lavaud +33 (0) 1 43 18 52 00 FinsburyAlex Pettifer +44 (0) 20 7251 3801Euro RSCGBenjamin Perret +33 (0) 1 58 47 95 39 Analysts:Kesa Electricals plcSimon Herrick +44 (0) 20 7269 1400Simon Ward +44 (0) 20 7269 1400 There will be a presentation today to analysts and institutions at 09.30am atThe Conference Centre, Merrill Lynch, 2 King Edwards Street, London, EC1A 1HQ. This announcement is available on the KESA Electricals website:www.kesaelectricals.com. A live webcast of the presentation to analysts andinstitutions will also be available on the site at 09.30am, and recorded foraccess later in the day. As previously announced Kesa Electricals has changed its year end to 30 April.Summary unaudited financial information for the year ended 30 April 2007 isavailable on our website. Certain statements made in this announcement are forward looking statements.Such statements are based on current expectations and are subject to a number ofrisks and uncertainties that could cause actual results to differ materiallyfrom any expected future results in forward looking statements KESA Electricals is a specialist electrical retailer. It employs more than28,000 people and trades in ten countries and has an annual turnover ofapproximately £4.5 billion. KESA Electricals is a member of the FTSE 250. Itsordinary shares are listed with the UK Listing Authority and trade on the marketfor listed securities on the London Stock Exchange under the symbol KESA.L. Itis also listed on the Premier Marche of the Paris Stock Exchange. For furtherinformation, please visit the company's website, as above. GROUP OVERVIEW Results as reported in sterling +--------+----------+----------+--------+-------------+-------------+--------+| | Revenue | Revenue | Change |Retail profit|Retail profit| Change || | for 6 | for 6 | | for 6 | for 6 | | | | months | months | | months | months | || | ended | ended | | ended | ended | || | 31 July | 31 July | | 31 July | 31 July | || | 2007 | 2006 | | 2007 | 2006 | || | | | | | | || | £m | £m | | £m | £m | |+--------+----------+----------+--------+-------------+-------------+--------+|Darty | 807.9 | 765.6 | 5.4% | 33.2 | 40.9 |(18.8)% |+--------+----------+----------+--------+-------------+-------------+--------+|Comet | 706.0 | 683.5 | 3.3% | (1.0) | 4.8 | - |+--------+----------+----------+--------+-------------+-------------+--------+|BUT | 276.1 | 266.6 | 3.6% | 16.7 | 14.8 | 12.8% |+--------+----------+----------+--------+-------------+-------------+--------+|Other* | 254.2 | 210.2 | 20.9 | (4.3) | (6.3) | - |+--------+----------+----------+--------+-------------+-------------+--------+|Central | - | - | - | (6.4) | (6.2) | - |+--------+----------+----------+--------+-------------+-------------+--------+|Total | 2044.2 | 1925.9 | 6.1% | 38.2 | 48.0 |(20.4)% |+--------+----------+----------+--------+-------------+-------------+--------+ Results as reported in local currency +--------+----------+----------+--------+-------------+-------------+--------+| | Revenue | Revenue | Change |Retail profit|Retail profit| Change || | for 6 | for 6 | | for 6 | for 6 | | | | months | months | | months | months | || | ended | ended | | ended | ended | || | 31 July | 31 July | | 31 July | 31 July | || | 2007 | 2006 | | 2007 | 2006 | || | | | | | | || | m | m | | m | m | |+--------+----------+----------+--------+-------------+-------------+--------+|Darty | €1193.8 | €1113.6 | 7.2% | €49.1 | €59.5 |(17.5)% |+--------+----------+----------+--------+-------------+-------------+--------+|Comet | £706.0 | £683.5 | 3.3% | £(1.0) | £4.8 | - |+--------+----------+----------+--------+-------------+-------------+--------+|BUT | €408.0 | €387.8 | 5.2% | €24.7 | €21.5 | 14.9% |+--------+----------+----------+--------+-------------+-------------+--------+|Other* | €375.6 | €305.8 | 22.8% | •(6.4) | •(9.2) | - |+--------+----------+----------+--------+-------------+-------------+--------+ *Includes BCC, Vanden Borre, Datart, Darty Italy, Darty Switzerland and Darty Turkey. Financial Highlights Group revenue was £2,044.2 million, up 6.1 per cent on last year (7.2 per centin constant currency) and up 3.9 per cent on a like for like basis. Group retail profit was £38.2 million, down 20.4 per cent on last year.Underlying retail profit, before the impact of new developments and leasepremiums, grew by 13.8 per cent to £55.9 million. The net interest charge was £4.2 million (2006: £7.0 million). Profit before taxand after interest was £32.4 million compared to £39.3 million last year. The effective tax rate including the share of joint venture and associates' taxwas 32.9 per cent, 34.9 per cent for the same period in 2006. Cash generated from operations was £66.2 million, up from £56.4 million lastyear. Net capital expenditure and investments increased to £76.1 million from £57.0million. In line with the seasonal profile, closing net debt was £155.4 million, up from£75.4 million at the end of last year but down from £240.9 million at 31 July2006. Net assets have increased from £316.1 million at 31 July 2006 to £347.3million at 31 July 2007. Basic and diluted earnings per share were 4.5 pence (5.2 pence in 2006). The Board has declared a first interim dividend of 3.5 pence, an increase of 7.7per cent. The ex dividend date will be 7 November 2007, the record date 9November 2007 and payment date 7 December 2007. Trading Highlights Against tough comparatives market conditions in Europe were slightly positive.Overall group revenue was driven by the high demand for new technologies andincreased sales of white goods. As anticipated, the negative mix effect onmargin eased. In France, revenue growth at Darty was up 7.2 per cent in local currency, up 4.1per cent on a like for like basis. Developments to enhance the customer serviceproposition, including Darty Box, the Darty Card and a new fitted kitchen offer,impacted profitability. Before taking into account the Darty Box losses, retailprofit remained stable. Comet's revenue increased by 3.3 per cent, up 0.9 per cent on a like for likebasis. Against a strong retail profit performance in the first half of 2006(£4.8 million), which benefited from a one-off £3.5 million net lease premium,Comet reported a small loss of £1.0 million. During the period Comet acceleratedits mezzanine store opening programme. BUT successfully built on the initiatives put in place last year to improve itssales and profitability. Total store revenue grew by 6.4 per cent in localcurrency and retail profit grew by 14.9 per cent. Total revenue at the other businesses, BCC, Vanden Borre, Datart, Darty Italy,Darty Switzerland and Darty Turkey, grew by 22.8 per cent in local currency, up11.1 per cent on a like for like basis. Retail profit was €5.9 million for theestablished businesses. Start up losses were €12.3 million for our developmentsin Italy, Switzerland and Turkey. In September, Kesa completed its acquisition of Menaje Del Hogar in Spain for€100 million in cash together with the assumption of approximately €35 millionnet debt. The business provides the group with a solid platform for entry intothe fifth largest electricals market in Europe. Outlook The economic climate in Europe for the second half of the year is uncertain,particularly in the UK. We anticipate that sales will continue to be driven bythe strong new technology product cycle and sales of white goods should remainpositive in Continental Europe. The second half of the year is always the key period for the group and we willstay focussed on cost control, operational efficiencies and cash and marginmanagement. The group's plans will progress as planned with emphasis on Darty's customerproposition, Comet's property portfolio and services development, the new marketstart-up operations and the acquisition in Spain. These developments will impacton profitability in the short-term but are central to securing the future growthof the business. DARTY +-----------+---------+-----------+-------+---------+----------+--------+| | Results | Results |Change | Results | Results | Change || | for 6 | for | | for 6 | for | || | months | 6 months | | months | 6 months | || | ended | ended | | ended | ended | || | 31 July | 31 July | | 31 July | 31 July | || | 2007 | 2006 | | 2007 | 2006 | || | | | | | | || | £m | £m | | •m | •m | |+-----------+---------+-----------+-------+---------+----------+--------+|Revenue | 807.9 | 765.6 | 5.4% | 1193.8 | 1113.6 | 7.2% |+-----------+---------+-----------+-------+---------+----------+--------+|Retail | 33.2 | 40.9 |(18.8)%| 49.1 | 59.5 |(17.5)% ||profit | | | | | | |+-----------+---------+-----------+-------+---------+----------+--------+| | | | | | | |+-----------+---------+-----------+-------+---------+----------+--------+|No of | 212 | 207 | +5 | | | ||stores | | | | | | |+-----------+---------+-----------+-------+---------+----------+--------+|Sales | | | | | | ||space | 279.4 | 272.0 | 2.7% | | | ||(000s sq m)| | | | | | |+-----------+---------+-----------+-------+---------+----------+--------+ Darty's total revenue increased by 7.2 per cent in local currency compared tothe same period last year, up 4.1 per cent on a like for like basis. Salescontinued to be driven by the high demand for new technologies and increasedsales of white goods. As anticipated, the negative mix effect on margin eased. During the period Darty continued to invest in Darty Box and its store portfolioand launched a new fitted kitchen range. Consequently, retail profit was €49.1million, a decrease of 17.5 per cent on the previous year. Before taking intoaccount losses on Darty Box of €10.9 million, €0.9 million in 2006, retailprofit remained stable. Darty continued to enhance its customer proposition. The 'Darty Card', enablingus to keep track of customers' transactions and after sales servicerequirements, was launched in March and over 1.8 million cards have already beenissued. Darty Box, introduced towards the end of last year, showed a very encouraginglaunch period but sales slowed during April and May. The single play propositionwas launched in June. Independent research has confirmed that customers highlyrate both the technical quality of Darty Box and the associated after-salessupport. At the end of July subscriber numbers totalled 66,000. It is too earlyto assess seasonal trends but we anticipate increased demand during the secondhalf of the year. An additional service, 'Video on Demand', was introduced inAugust and a new national marketing campaign commenced to coincide with the backto school period. In June Darty launched its first fitted kitchen range from its store in rue deRivoli in central Paris. Early sales numbers are encouraging and we will extendthe pilot to two additional stores outside Paris before the end of October. The store modernisation programme progressed on schedule. In the first half,Darty completed three new store openings and six refurbishments/extensions. Forthe second half, two new store openings, two relocations and threerefurbishments / extensions are planned. Sales generated from the Darty web site continued to deliver strong growth, withan uplift of 64.8 per cent. The 'click and collect' service option for customerswas successfully launched in June. COMET +----------------+---------------------+-------------------------+-------------+| | Results for | Results for | Change || | 6 months ended | 6 months ended | || | 31 July 2007 | 31 July 2006 | || | £m | £m | |+----------------+---------------------+-------------------------+-------------+|Revenue | 706.0 | 683.5 | 3.3% |+----------------+---------------------+-------------------------+-------------+|Retail profit | (1.0) | 4.8 | - |+----------------+---------------------+-------------------------+-------------+| | | | |+----------------+---------------------+-------------------------+-------------+|No of stores | 249 | 246 | +3 |+----------------+---------------------+-------------------------+-------------+|Sales space | 260.2 | 255.7 | 1.8% ||(000s sq m) | | | |+----------------+---------------------+-------------------------+-------------+ Comet delivered total revenue of £706.0 million, up 3.3 per cent on the sameperiod last year and up 0.9 per cent on a like for like basis. Sales were helpedby the continued strong demand for flat screen televisions and laptops, whilesales of white goods were flat. Against a particularly strong performance for the same period last year, whichalso benefited from a £3.5 million net lease premium, Comet reported a smallretail loss of £1.0 million. Comet's execution of its re-positioning programme progressed further. 62,000e-learning courses which help in-store and call centre colleagues develop theirproduct knowledge and selling have been completed. 'Comet on Call', providingexpert PC and laptop support for the home and small business customers, waslaunched in March and is now available from all stores nationwide. The success of the stores with trading mezzanine floors encouraged Comet toaccelerate its investment in this format and seven stores were converted in thefirst half. In addition, two new stores were opened while one store was closed.The store in Solihull was refurbished with a 'Living Room' lay-out for visualand audio ranges. In the second half of the year, three stores will be openedand five stores will be converted to the mezzanine format. 'Click and collect' helped sales generated from the web site grow by 23 percent. BUT +-----------+----------+----------+--------+-----------+----------+--------+| | Results | Results | Change | Results | Results | Change || | for 6 | for | | for 6 | for | || | months | 6 months | | months | 6 months | || | ended | ended | | ended | ended | || | 31 July | 31 July | | 31 July | 31 July | || | 2007 | 2006 | | 2007 | 2006 | || | | | | | | || | £m | £m | | •m | •m | |+-----------+----------+----------+--------+-----------+----------+--------+|Revenue | 276.1 | 266.6 | 3.6% | 408.0 | 387.8 | 5.2% |+-----------+----------+----------+--------+-----------+----------+--------+|Retail | 16.7 | 14.8 | 12.8% | 24.7 | 21.5 | 14.9% ||profit | | | | | | |+-----------+----------+----------+--------+-----------+----------+--------+| | | | | | | |+-----------+----------+----------+--------+-----------+----------+--------+|No of | 112 | 106 | +6 | | | ||stores | | | | | | |+-----------+----------+----------+--------+-----------+----------+--------+|Sales | | | | | | ||space | 362.9 | 346.3 | 4.8% | | | ||(000s sq m)| | | | | | |+-----------+----------+----------+--------+-----------+----------+--------+ BUT grew its total revenue by 5.2 per cent in local currency, with its in-housewholesale business growing by 0.3 per cent and store turnover growing by 6.4 percent, (up 5.7 per cent on a like for like basis). Retail profit grew by 14.9 percent to €24.7 million. BUT is successfully progressing the initiatives put in place last year torestore its sales and profit growth. Sales of furniture and home furnishingswere particularly strong in a market which is back to growth. The small to mid sized stores relayed to date continue to deliver good salesgrowth. A further nine stores are currently being relayed. Last year, BUT launched a new kitchen offer to provide customers with bothkitchen furniture and associated electrical appliances. The ranges and relatedservices were re-designed to meet customer demand and continue to showencouraging results. During the period, BUT acquired eight franchisee stores and will acquire afurther four stores in the second half. OTHER BUSINESSES +-----------+----------+----------+--------+-----------+----------+--------+| | Results | Results | Change | Results | Results | Change || | for 6 | for | | for 6 | for | || | months | 6 months | | months | 6 months | || | ended | ended | | ended | ended | || | 31 July | 31 July | | 31 July | 31 July | || | 2007 | 2006 | | 2007 | 2006 | || | | | | | | || | £m | £m | | •m | •m | |+-----------+----------+----------+--------+-----------+----------+--------+|Revenue | 254.2 | 210.2 | 20.9% | 375.6 | 305.8 | 22.8% |+-----------+----------+----------+--------+-----------+----------+--------+|Retail | (4.3) | (6.3) | - | (6.4) | (9.2) | - ||profit | | | | | | |+-----------+----------+----------+--------+-----------+----------+--------+| | | | | | | |+-----------+----------+----------+--------+-----------+----------+--------+|No of | 149 | 135 | +14 | | | ||stores | | | | | | |+-----------+----------+----------+--------+-----------+----------+--------+|Sales | | | | | | ||space | 178.0 | 155.0 | 14.8% | | | ||(000s sq m)| | | | | | |+-----------+----------+----------+--------+-----------+----------+--------+ Total revenue for BCC, Vanden Borre, Datart, Darty Italy, Darty Switzerland andDarty Turkey grew by 22.8 per cent in local currency, up 11.1 per cent on a likefor like basis, helped by particularly strong sales performances at ourestablished businesses BCC, Vanden Borre and Datart. Retail profit for these three businesses rose to €5.9 million from €0.4 millionlast year. Start up losses for Darty Italy, Darty Switzerland and Darty Turkeytotalled €12.3 million, €9.6 million in 2006. The established businesses continued to benefit from consolidating markets andsignificantly increased market share. In total four new stores were opened, sixwere refurbished/extended and one store was closed. During the second half fournew stores will open and two relocations and four refurbishments/extensions willbe completed. In Italy, two new stores opened in Milan and there are now 11 stores inoperation. During the second half of the year, a further three stores will open,also in the Milan region. The Darty stores in Switzerland continue to receive positive customer feedbackand achieve a high conversion rate and average selling price. There are now fourstores in total and one more will open in Geneva in the third quarter of theyear. In Turkey we now have three stores open in Istanbul with two further storesplanned for the third quarter. Trading has been very encouraging. The acquisition of Menaje Del Hogar (MH) in Spain was completed on 17 September2007. Spain is the fifth largest market in Europe with further growth potentialand MH provides us with a solid platform for entry into this market. Group IncomestatementSix months ended 31July 2007 Six months Six months Year ended 31 Six months ended 31 July ended 31 July January 2007 ended 31 July 2007 2006 (audited) 2007 (unaudited) (unaudited) (unaudited) Note £m £m £m •m(1) Revenue 2 2,044.2 1,925.9 4,500.9 3,020.7Group operating profit 2 31.6 41.1 167.5 46.6Share of post tax profit injoint venture and associates 2 5.0 5.2 10.3 7.4 Total operating profit 36.6 46.3 177.8 54.0 Analysed as:Retail profit (2) 3 38.2 48.0 181.0 56.4Share of joint venture andassociates interest andtaxation 3 (1.6) (1.1) (2.7) (2.4)Demerger award plan charge 3 - (0.6) (0.5) - Total operating profit 36.6 46.3 177.8 54.0 Finance costs (8.1) (9.8) (19.3) (12.0)Finance income 3.9 2.8 6.9 5.8 Profit before tax 32.4 39.3 165.4 47.8 UK taxation 2.8 7.7 (5.8) 4.1Overseas taxation (12.4) (20.7) (50.2) (18.3) Total Taxation (9.6) (13.0) (56.0) (14.2) Profit for the financialperiod from continuingoperations 22.8 26.3 109.4 33.6 Profit/(loss)attributable to:- Equity shareholders 23.8 27.3 109.4 35.1- Minority interests (1.0) (1.0) - (1.5) 22.8 26.3 109.4 33.6Earnings per share - basicand diluted (pence) 6 4.5 5.2 20.7 6.6 Notes 1) Income statement information in euros is provided for illustrative purposesonly and is translated at the average exchange rate of €1.4777 for £1. 2) Retail profit is defined as total operating profit before the share ofjoint venture and associates' interest and taxation, the Demerger Award Plancharge and valuation gains/(losses) on options to acquire minority interests.The comparative amounts have been restated to include any gains or lossesarising on the disposal of property, plant and equipment. Group statement of recognised income and expenseSix months ended 31 July 2007 Six months Six months Year ended 31 Six months ended 31 ended 31 July January 2007 ended 31 July July 2007 2006 (audited) 2007 (unaudited) (unaudited) (unaudited) Note £m £m £m •m(1) Exchange differences 12 2.2 0.5 (5.7) 3.3Actuarial gains on retirement benefit obligations 7.1 35.1 28.3 10.5Tax on actuarial gains onretirement benefit obligations (3.6) (10.5) (8.7) (5.3)Available-for-sale assets -fair value gains net of tax 12 2.4 1.9 1.6 3.5Cash flow hedges - fair value gains net of tax 12 0.4 1.8 2.7 0.6 - recycled and reported in net profit (0.1) 0.6 0.6 (0.1)Impact of put options granted in respect of minority interestsexercised or revalued during the year 12 - 11.1 10.9 -Tax on employee share schemes 11 0.2 (0.6) (1.2) 0.3Net profit recognised directly in equity 8.6 39.9 28.5 12.8 Profit for the period 3 22.8 26.3 109.4 33.6 Total recognised income for the period 31.4 66.2 137.9 46.4 Attributable to: - Equity shareholders 32.4 67.2 137.9 47.9 - Minority interests (1.0) (1.0) - (1.5)Total recognised income for the period 31.4 66.2 137.9 46.4 Note 1) Statement of recognised income and expense information in euros is providedfor illustrative purposes only and is translated at the average exchange rate of€1.4777 for £1. Group balance sheetAs at 31 July 2007 31 July 2007 31 July 2006 31 January 2007 31 July 2007 (unaudited) (unaudited) (audited) (unaudited) Note £m £m £m •m(1)AssetsNon-current assetsIntangible assets 7 232.1 214.9 217.9 345.1Property, plant and equipment 8 539.5 528.8 513.9 802.2Available-for-sale financial assets 22.9 22.0 20.0 34.0Investments in joint ventures and associates 44.0 42.8 43.7 65.4Other receivables 11.4 11.1 10.9 17.0Derivative financial instruments 5.0 3.7 5.0 7.4Deferred income tax assets 24.8 26.5 26.3 36.9Total non-current assets 879.7 849.8 837.7 1,308.0 Current assetsInventories 620.3 586.4 614.3 922.3Trade and other receivables 268.9 223.6 280.5 399.9Income tax 14.6 12.6 12.1 21.7Other investments 70.7 81.2 72.3 105.1Derivative financial instruments 0.3 - 0.2 0.4Cash and cash equivalents 9 109.4 100.1 163.3 162.7Total current assets 1,084.2 1,003.9 1,142.7 1,612.1 Total assets 1,963.9 1,853.7 1,980.4 2,920.1 LiabilitiesCurrent liabilitiesBorrowings (34.4) (59.8) (105.9) (51.1)Income tax liabilities (11.0) (2.4) (21.2) (16.3)Trade and other payables (887.9) (747.3) (896.8) (1,320.2)Derivative financial instruments (0.4) (0.2) (0.1) (0.6)Provisions (1.4) (0.9) (1.2) (2.1)Total current liabilities (935.1) (810.6) (1,025.2) (1,390.3) Non-current liabilitiesBorrowings (298.1) (360.0) (202.4) (443.2)Other payables (264.0) (251.8) (259.3) (392.7)Deferred income tax liabilities (42.0) (28.7) (35.1) (62.4)Retirement benefits (76.7) (86.2) (87.0) (114.1)Provisions (0.7) (0.3) (0.7) (1.0)Total non-current liabilities (681.5) (727.0) (584.5) (1,013.4) Total liabilities (1,616.6) (1,537.6) (1,609.7) (2,403.7) Net assets 347.3 316.1 370.7 516.4 Group balance sheet continuedAs at 31 July 2007 31 July 2007 31 July 2006 31 January 2007 31 July 2007 (unaudited) (unaudited) (audited) (unaudited) Note £m £m £m •m(1)Equity Share capital 10 132.4 132.4 132.4 196.9Other reserves 12 741.8 742.7 736.9 1,102.9Retained earnings 11 (528.5) (562.1) (503.1) (785.8)Total equity shareholders'funds 13 345.7 313.0 366.2 514.0 Minority interests 1.6 3.1 4.5 2.4 Total equity 347.3 316.1 370.7 516.4 Notes 1)Balance sheet information in euros is provided for illustrative purposes only and is translated at the closing exchange rate of €1.4869 for £1. Approved by the Board of Directors on 26 September 2007 and signed on its behalf by: Jean-Noel Labroue Simon Herrick Director Director Group cash flow statementSix months ended 31 July 2007 Six months Six months Year ended 31 Six months ended 31 July ended 31 July January 2007 ended 31 July 2007 2006 (audited) 2007 (unaudited) (unaudited) (unaudited) Note £m £m £m •m(1) Cash flows from operating activitiesCash generated from operations 14 66.2 56.4 307.9 97.8Interest received 3.9 2.8 6.7 5.8Interest paid (7.3) (8.3) (15.6) (10.8)Tax paid (17.4) (20.9) (37.8) (25.7)Net cash flows from operatingactivities 45.4 30.0 261.2 67.1 Cash flows from investing activitiesAcquisition of subsidiaries(net of cash acquired) (9.6) (10.5) (13.1) (14.2)Proceeds from sale of property,plant and equipment 0.9 0.5 1.0 1.3Purchase of property, plant andequipment (56.0) (38.4) (80.0) (82.8)Purchase of available-for-saleinvestments (0.2) - - (0.3)Purchase of intangible assets (11.2) (8.6) (19.5) (16.6)Cash inflow from other currentinvestments 1.6 (0.6) 6.9 2.4Dividends received fromjoint venture 5.2 1.5 4.4 7.7Net cash used in investing activities (69.3) (56.1) (100.3) (102.5) Cash flows from financing activitiesFinance lease principal payments - (0.4) - -Proceeds from long-term borrowings 434.1 82.6 489.8 641.5Repayment of long-term borrowings (340.8) (70.0) (627.9) (503.6)Dividends paid to shareholders (53.2) (48.5) (65.7) (78.6)Dividends paid to minority interests (0.4) (0.9) (0.9) (0.6)Net cash generated/(used) in financing activities 39.7 (37.2) (204.7) 58.7 Net cash inflow/(outflow) from cash,cash equivalents and bank overdrafts 15 15.8 (63.3) (43.8) 23.3 Effects of exchange rate changes 15 1.7 0.4 (2.2) 2.5 Net increase/(decrease) in cash,cash equivalents and bank overdrafts 17.5 (62.9) (46.0) 25.8 Cash, cash equivalents and bankoverdrafts at start of period 15 59.8 105.8 105.8 88.1 Cash, cash equivalents and bank overdrafts at end of period 15 77.3 42.9 59.8 113.9 Notes 1) Cash flow information in euros is provided for illustrative purposes only and is translated at the average exchange rate of €1.4777 for £1. Notes to the financial statementsSix months ended 31 July 2007 1 Accounting policies Basis of preparation The financial information set out in the following pages comprises the condensedfinancial statements of Kesa Electricals plc for the six months ended 31 July2007. They have been prepared in accordance with the accounting policies set outin the 2006/7 Annual report approved on 21 March 2007 and should be read inconjunction with those consolidated financial statements. The condensedconsolidated financial statements comprise the Company and its subsidiaryundertakings (together referred to as the "Group") and the Group's interests inassociated undertakings and joint ventures. The condensed consolidated financial statements for the half-year ended 31 July2007 have been prepared in accordance with the Disclosure and Transparency Rulesof the Financial Services Authority and with IAS 34 "Interim FinancialReporting" as adopted by the European Union. The half-yearly condensedconsolidated financial report should be read in conjunction with the annualfinancial statements for the year ended 31 January 2007, which have beenprepared in accordance with IFRS as adopted by the European Union. The half year report is unaudited, but has been reviewed by the auditors. Itdoes not constitute statutory financial statements within the meaning of Section240 of the Companies Act 1985. The comparative figures for the year ended 31January 2007 are derived from the statutory accounts filed with the Registrar ofCompanies. The audit report on the Annual Report 2006/07 was unqualified, didnot contain an emphasis of matter paragraph and did not contain any statementunder Section 237 of the Companies Act 1985. Use of adjusted measures Kesa Electricals plc believes that Retail Profit and adjusted earnings per shareprovide additional useful information on underlying trends and businessperformance to shareholders. Retail Profit is defined as total operating profitbefore the Demerger Award Plan charge, the share of joint venture and associatesinterest and taxation and valuation gains and losses on options to acquireminority interests. These measures are used by the Group for internalperformance analysis and incentive compensation arrangements for employees. Theterm Retail Profit is not defined by IFRS and may therefore not be comparablewith similarly titled profit measures reported by other companies. It is notintended to be a substitute for, or superior to, GAAP measurements of profit. In previous periods Retail Profit has excluded any gains or losses arising onthe disposal of property, plant and equipment. After a review of the componentsof Retail Profit in the period since demerger, management has concluded thatproperty, plant and equipment disposal gains and losses are an integral andrecurring feature of a retail business, and are similar in nature to gains andlosses arising on leases and should therefore be treated similarly and includedin Retail Profit. In addition, it has been concluded that any gains or lossesarising from the movement in put and call options in respect of minorityinterests during the period should be excluded from Retail Profit. Managementbelieve that the revised measure of Retail Profit will better reflect thefinancial performance of the Group. The change in the definition of Retail Profit is effective for the 2007/08financial year. The Group income statement and the segmental analysis (note 3)have been restated for the comparative periods to comply with this reviseddefinition. The change had a positive impact of £0.6m on Retail Profit for thesix months to 31 July 2007, a positive impact of £0.1m for the year to 31January 2007 and a negative impact of £0.6m for the six months to 31 July2006. Notes to the financial statementsSix months ended 31 July 2007 1 Accounting policies continuedPrincipal rates of exchange Euro Czech KrAverage rate - six months to 31 July 2007 1.4777 41.7299Closing rate - 31 July 2007 1.4869 42.6841 Average rate - six months to 31 July 2006 1.4546 41.4535Closing rate - 31 July 2006 1.4627 41.1645 Average rate - year ended 31 January 2007 1.4712 41.5569Closing rate - 31 January 2007 1.5081 40.7871 2 Group operating profit Six months Six months Year ended ended 31 July ended 31 July 31 January 2007 2006 2007 £m £m £m Revenue 2,044.2 1,925.9 4,500.9Cost of sales (1,439.1) (1,354.9) (3,188.8)Gross profit 605.1 571.0 1,312.1 Distribution costs (107.4) (104.0) (222.0)Selling expenses (422.2) (389.1) (840.3)Administrative expenses (57.7) (49.6) (104.8)Other income 13.8 12.8 22.5Group operating profit 31.6 41.1 167.5Share of post tax profit in joint ventureand associates 5.0 5.2 10.3Total operating profit 36.6 46.3 177.8 The Demerger Award Plan charge is included within administrative expenses. Group operating profit includes net premiums on exit from leased premises of £Nil(31 July 2006: £6.1m, 31 January 2007: £6.4m) and property, plant and equipmentdisposal gains of £0.6m (31 July 2006: £0.6m loss, 31 January 2007: £0.1m). Total revenue includes revenue from services of £116.6m (31 July 2006: £107.1m,31 January 2007: £226.7m). Such revenues predominantly comprise those relating tocustomer support agreements, delivery and installation, product repairs andproduct support. Notes to the financial statementsSix months ended 31 July 2007 3 Segmental analysis At 31 July 2007, 31 July 2006 and 31 January 2007, the Group was organised intofour business segments: Darty; BUT; Comet; and Other (includes BCC, Vanden Borre,Datart, Darty Italy, Darty Switzerland and Darty Turkey). France France UK Central Darty BUT Comet Other Costs GroupSix months ended 31 July 2007 £m £m £m £m £m £m Revenue 807.9 276.1 706.0 254.2 - 2,044.2Retail profit/(loss) 33.2 16.7 (1.0) (4.3) (6.4) 38.2Share of joint venture andassociates interest and taxation (0.2) (1.4) - - - (1.6) Operating profit/(loss) 33.0 15.3 (1.0) (4.3) (6.4) 36.6 Finance costs (8.1)Finance income 3.9Finance costs - net (4.2) Profit before income tax 32.4Income tax expense (9.6)Profit for the period 22.8 The share of operating profits of the joint venture and associates included withinthe retail profit for Darty and BUT are £2.7m and £3.9m respectively. The share ofpost tax profits of the joint venture and associates included within the operatingprofit for Darty and BUT are £2.5m and £2.5m respectively. France France UK Central Darty BUT Comet Other Costs GroupSix months ended 31 July 2006 £m £m £m £m £m £m Revenue 765.6 266.6 683.5 210.2 - 1,925.9Retail profit/(loss) 40.9 14.8 4.8 (6.3) (6.2) 48.0Share of joint venture andassociates interest and taxation (0.1) (1.0) - - - (1.1)Demerger award plan charge (0.2) - (0.1) (0.1) (0.2) (0.6) Operating profit/(loss) 40.6 13.8 4.7 (6.4) (6.4) 46.3 Finance costs (9.8)Finance income 2.8Finance costs - net (7.0) Profit before income tax 39.3Income tax expense (13.0)Profit for the period 26.3 The share of operating profits of the joint venture and associates included withinthe retail profit for Darty and BUT are £3.0m and £3.3m respectively. The share ofpost tax profits of the joint venture and associates included within operatingprofit for Darty and BUT are £2.9m and £2.3m respectively. Notes to the financial statementsSix months ended 31 July 2007 3 Segmental analysis continued France France UK Central Darty BUT Comet Other Costs GroupYear ended 31 January 2007 £m £m £m £m £m £m Revenue 1,733.9 595.7 1,676.5 494.8 - 4,500.9Retail profit/(loss) 114.1 36.3 46.1 (2.4) (13.1) 181.0Share of joint venture and associates interest and taxation (0.3) (2.4) - - - (2.7)Demerger award plan charge (0.1) - (0.1) (0.1) (0.2) (0.5)Operating profit/(loss) 113.7 33.9 46.0 (2.5) (13.3) 177.8 Finance costs (19.3)Finance income 6.9Finance costs - net (12.4) Profit before income tax 165.4Income tax expense (56.0)Profit for the year 109.4 The share of operating profits of the joint venture and associates includedwithin the retail profit for Darty and BUT are £5.9m and £7.1m respectively. Theshare of post tax profits of the joint venture and associates included withinthe operating profit for Darty and BUT are £5.6m and £4.7m respectively. 4 Seasonality of resultsThe revenue from sales of electrical products plus associated services aresubject to some seasonal fluctuations, with peak demand around the Christmasand New Year periods in the fourth quarter of the year. The total revenue forthe Group for the six months to 31 July 2007 represented 45 per cent (sixmonths ended 31 July 2006 : 43 per cent) of the total annual revenue in theyear ended 31 January 2007. 5 Dividends Six months Six months Year ended ended 31 July ended 31 July 31 January 2007 2006 2007 £m £m £mFinal paid 2007: 10.05 pence (2006: 9.15 pence) per share 53.2 48.5 48.5Interim paid - - 17.2 53.2 48.5 65.7 The final dividend in respect of the financial year ended 31 January 2007 wasapproved by shareholders at the Annual General Meeting. The Directors have declared a first interim dividend of 3.50 pence per share (2006: 3.25 pence per share), which will absorb an estimated £18.5m of shareholders' funds. As a result of the financial year being changed to 30 April, the Directors are intending, for this year only, to declare a second interim dividend in March 2008. Notes to the financial statementsSix months ended 31 July 2007 6 Earnings per share Basic earnings per share is calculated by dividing the earnings attributable toshareholders by 529.5m shares (31 July 2006: 529.4m and 31 January 2007:529.5m), being the weighted average number of ordinary shares in issue. There is no difference between diluted and basic earnings per share.Supplementary adjusted earnings per share figures are presented. These excludethe effects of the Demerger Award Plan charge. Six months ended Six months ended Year ended 31 July 2007 31 July 2006 31 January 2007 Per share Per share Per share Earnings amount Earnings amount Earnings amount £m pence £m pence £m penceBasic earnings per share Earnings attributable to ordinary shareholders 23.8 4.5 27.3 5.2 109.4 20.7AdjustmentsDemerger Award Plan charge - - 0.6 0.1 0.5 0.1Tax effect of adjustments - - (0.2) - (0.1) - Basic - adjusted earnings per share 23.8 4.5 27.7 5.3 109.8 20.8 7 Intangible Assets Other Goodwill Software intangibles Total £m £m £m £mOpening net book amount at 1 February 2007 182.6 18.1 17.2 217.9Additions 9.6 6.7 4.5 20.8Disposals (0.6) - - (0.6)Amortisation, impairment and other movements 2.6 (2.1) (6.5) (6.0) Closing net book amount at 31 July 2007 194.2 22.7 15.2 232.1 Other Goodwill Software intangibles Total £m £m £m £mOpening net book amount at 1 February 2006 180.1 11.7 9.0 200.8Additions 6.7 2.1 6.4 15.2Amortisation, impairment andother movements 0.1 (1.1) (0.1) (1.1)Closing net book amount at 31 July 2006 186.9 12.7 15.3 214.9 Notes to the financial statementsSix months ended 31 July 2007 8 Property, plant and equipment £m Opening net book amount at 1 February 2007 513.9Additions 57.9Disposals (3.2)Depreciation, impairment and other movements (29.1)Closing net book amount at 31 July 2007 539.5 During the six-month period the group acquired £57.9m of property, plant andequipment. Of these additions £12.5m relates to store refurbishments, with a further£7.1m of IT upgrades, £6.5m of furniture and £9.7m of assets in the course ofconstruction. £m Opening net book amount at 1 February 2006 530.8Additions 38.5Disposals (3.0)Depreciation, impairment and other movements (37.5)Closing net book amount at 31 July 2006 528.8 Capital Commitments Six months Six months ended 31 July ended 31 July 2007 2006 £m £m Contracts placed for future capitalexpenditure not provided for:- property, plant and equipment 4.6 2.3- intangible assets 0.1 -Total 4.7 2.3 Notes to the financial statementsSix months ended 31 July 2007 9 Cash and cash equivalents Six months Six months Year ended 31 ended 31 July ended 31 July January 2007 2007 2006 £m £m £mCash at bank and in hand 65.1 45.8 53.0Short-term bank depositand investments 44.3 54.3 110.3Total 109.4 100.1 163.3 For the purpose of the consolidated cash flow statement, cash, cash equivalentsand bank overdrafts comprise the following: Six months Six months Year ended 31 ended 31 July ended 31 July January 2007 2007 2006 £m £m £m Cash at bank and in hand 65.1 45.8 53.0Bank overdrafts (32.1) (57.2) (103.5)Short-term bank depositsand investments 44.3 54.3 110.3Total cash, cash equivalentsand bank overdrafts 77.3 42.9 59.8 The effective interest rate on short-term deposits held at 31 July 2007 was 5.09per cent (31 July 2006: 4.35 per cent, 31 January 2007: 5.00 per cent) and thesedeposits had an average maturity of 4.4 days (31 July 2006: 3.3 days, 31 January2007: 4.5 days). As part of the groups underlying insurance arrangements, £69.7m (31 July 2006:£68.2m, 31 January 2007: £71.8m) of bank deposits and other investments arepledged to meet expected future costs arising from the provision of extendedwarranty cover. Notes to the financial statementsSix months ended 31 July 2007 10 Share capital NumberAt 31 July 2007, 31 July 2006 and 31 January 2007 m £m AuthorisedOrdinary shares of 25 pence each 1,000 250.0Issued and fully paidOrdinary shares of 25 pence each 529.6 132.4 11 Retained earnings £m At 1 February 2007 (503.1)Profit for the period 23.8Dividends (53.2)Employee share schemes 0.4Tax on employee share schemes 0.2Investment in ESOP shares (0.1)Net SORIE pension movement 3.5At 31 July 2007 (528.5) £mAt 1 February 2006 (564.7)Profit for the period 27.3Dividends (48.5)Employee share schemes (0.1)Tax on employee share schemes (0.6)Investments in ESOP shares (0.1)Net SORIE pension movement 24.6At 31 July 2006 (562.1) Tax on employee share schemes for the current financial year has been separatelydisclosed and, consequently, prior year figures have been restated. Notes to the financial statementsSix months ended 31 July 2007 12 Other reserves Other Demerger Translation Available- Hedging Total reserve for-sale reserve reserve Investments reserve other reserve reserves £m £m £m £m £m £mAt 1 February 2007 (15.1) 741.8 (7.7) 15.3 2.6 736.9 Exchange differences - - 2.2 - - 2.2Available-for-sale assets - fair value gains net of tax - - - 2.4 - 2.4Cash flow hedges - fair value gains net of tax - - - - 0.4 0.4 - recycled and reported in net profit - - - - (0.1) (0.1)At 31 July 2007 (15.1) 741.8 (5.5) 17.7 2.9 741.8 Other Demerger Translation Available- Hedging Total for-sale reserve reserve reserve Investments reserve other reserve reserves £m £m £m £m £m £mAt 1 February 2006 (26.0) 741.8 (2.0) 13.7 (0.7) 726.8 Exchange differences - - 0.5 - - 0.5Available-for-sale assets - fair value gains net of tax - - - 1.9 - 1.9Cash flow hedges - fair value gains net of tax - - - - 1.8 1.8 - recycled and reported in net profit - - - - 0.6 0.6Put and call options movement 11.1 - - - - 11.1At 31 July 2006 (14.9) 741.8 (1.5) 15.6 1.7 742.7 The demerger reserve represents a reserve created on demerger and isnon-distributable. Exchange differences arising from the translation of the net investment inforeign operations on consolidation are included within the translationreserve. The available-for-sale investments reserve includes movements, net of deferredincome tax, in the fair value of available-for-sale investments. On disposal ofthe investment, the amount taken through the reserve is recycled out throughthe income statement. The movement in the fair value of cash flow hedges, net of deferred income tax,which are deemed to be effective, is taken through the hedging reserve. Onexpiry of the cash flow hedge, the amount in the hedging reserve is recycledthrough the income statement. If a hedge is deemed ineffective, the amount inthe hedging reserve is immediately recycled out through the income statement Amounts included within the other reserve represent the movement in respect ofput and call options over minority interests entered into, exercised orrevalued during the period. Notes to the financial statementsSix months ended 31 July 2007 13 Statement of changes in shareholders' equity Six months Six months Year ended 31 ended 31 July ended 31 July January 2007 2007 2006 £m £m £m Profit attributable to shareholders 23.8 27.3 109.4Dividends (53.2) (48.5) (65.7)Exchange differences 2.2 0.5 (5.7)Employee share schemes 0.4 (0.7) (0.2)Tax on employee share schemes 0.2 - (1.2)Available-for-sale assets - fair value gains net of tax 2.4 1.9 1.6Cash flow hedges - fair value gains net of tax 0.4 1.8 2.7 - recycled and reported in net profit (0.1) 0.6 0.6Investment in ESOP shares (0.1) (0.1) (0.3)Net actuarial gain on retirement benefit obligations 3.5 24.6 19.6Impact of movements in put and call options during the period - 11.1 10.9Opening shareholders' equity 366.2 294.5 294.5 Closing shareholders' equity 345.7 313.0 366.2 14 Cash flow from operating activities Six months Six months Year ended 31 ended 31 July ended 31 July January 2007 2007 2006 £m £m £mProfit after income tax 22.8 26.3 109.4Adjustments for:Income Tax 11.2 14.1 58.7Depreciation and amortisation 42.4 38.8 80.2Impairment of property, plant and equipment (0.7) - 1.5Reversal of impairment of property,plant and equipment - - (0.4)Loss on disposal of property, plant and equipment (including write offs) 1.3 2.5 4.6Finance income (3.9) (2.8) (6.9)Finance costs 8.1 9.8 19.3Share of results of joint venturesbefore taxation (2.2) (2.8) (5.1)Share of results of associatesbefore taxation (4.4) (3.5) (7.9)Changes in working capital:Increase/(decrease) in inventories 2.6 31.0 (5.5)Increase/(decrease) in trade and otherreceivables 18.8 16.5 (42.4)(Decrease)/increase in payables (29.8) (73.5) 102.4 Net cash inflow from operating activities 66.2 56.4 307.9 Income tax includes joint venture and associate tax of £1.6m (31 July 2006:£1.1m, 31 January 2007: £2.7m). Notes to the financial statementsSix months ended 31 July 2007 15 Reconciliation of net cash flow to movement in net debt At 31 July 2007 Cash flow Exchange At 1 February difference 2007Six months ended 31 July 2007 £m £m £m £m Cash at bank and in hand 65.1 11.7 0.4 53.0Overdrafts (32.1) 72.1 (0.7) (103.5)Short-term deposits and investments 44.3 (68.0) 2.0 110.3 77.3 15.8 1.7 59.8Borrowings falling due within one year (2.3) - 0.1 (2.4)Borrowings falling due after one year (298.1) (93.3) (2.4) (202.4)Finance leases (3.0) - (0.3) (2.7) (303.4) (93.3) (2.6) (207.5) Other current investments 70.7 (1.6) - 72.3Total (155.4) (79.1) (0.9) (75.4) 16 Reconciliation of cash flow to movement in net debt Six months Six months Year ended 31 ended 31 ended 31 July January 2007 July 2006 2007 £m £m £mNet cash inflow/(outflow) from cashand cash equivalents 15.8 (63.3) (43.8)Cash (outflow)/inflow from changein borrowings and lease financing (93.3) (12.2) 138.1Cash (outflow)/inflow from changein other current investments (1.6) 0.6 (6.9)Change in net debt resultingfrom cash flows (79.1) (74.9) 87.4 Translation differences (0.9) 0.3 3.5Movement in net debt in the period (80.0) (74.6) 90.9 Net debt at start of period (75.4) (166.3) (166.3)Net debt at end of period (155.4) (240.9) (75.4) Notes to the financial statementsSix months ended 31 July 2007 17 Acquisitions During the period, the Group acquired two businesses in France, Obry in April andMorieux in July, which will form part of the BUT segment, and two businesses in Italy,Rho in March and Carretti in April, which will form part of the Other segment. None ofthe acquisitions made during the period are individually, or in aggregate, material andfor this reason details of any pre and post acquisition results are not disclosed.The total consideration and amounts acquired are as follows: Subsidiaries Six months Six months ended 31 July ended 31 July 2007 2006 £m £m Property, plant and equipment 1.9 -Inventory 5.4 -Cash, cash equivalents and bank overdrafts 10.9 -Trade and other receivables 1.2 -Trade and other payables (7.4) -Total fair value of net assets acquired 12.0 - Goodwill arising on these acquisitions was as follows: Subsidiaries Six months Six months ended 31 July ended 31 July 2007 2006 £m £m Cash consideration 20.5 -Deferred consideration 1.1 -Net assets (12.0) -Goodwill 9.6 - No acquisitions were made in the six months ended 31 July 2006, however £6.8m ofgoodwill arose from the acquisition of the minority interest in an existingsubsidiary. Fair value of the tangible assets acquired is provisionally estimated to be equal tobook value, based on the best estimates currently available. Management currentlyanticipates that intangible assets arising on the acquisitions are in respect ofgoodwill, the value of other intangibles acquired being estimated as not material. Further adjustments to goodwill and the fair value of assets and liabilities acquiredmay be necessary when additional information is available concerning some of thejudgmental areas. Notes to the financial statementsSix months ended 31 July 2007 18 Related party transactions Transactions carried out with related parties in the normal course of business aresummarised below. Joint venture and associates Six months Six months ended 31 July ended 31 July 2007 2006 £m £mDividends receivable 5.2 1.5 The period-end balances with jointventure and associates are: Amounts recoverable from joint venture andassociates at 31 July 2007 2.4 2.4 Six months Six months ended 31 ended 31 July 2006 July 2007 £m £mValue of transactionswith associated undertakings 125.9 114.8 The associated undertakings provide credit facilities to customers in respect of productsales. Other related party transactions Six months Six months ended 31 July ended 31 July 2007 2006 £m £m Rent payments 0.5 0.5Other payments for services 0.4 0.5 Rent payments include £0.3m (2006: £0.2m) paid to members of key management, and £0.2m(2006: £0.3m) paid to directors of subsidiary undertakings, who are not part of keymanagement. Other payments for services provided by related parties principally compriseadministrative, accounting, information technology and human resources services. £0.3m(2006: £0.4m) was paid to members of key management and £0.1m (2006: £0.1m) was paid todirectors of subsidiary undertakings for other services provided during the period. Notes to the financial statementsSix months ended 31 July 2007 19 Contingent liabilities The Group has the following quantifiable contingent liabilities, which arose in theordinary course of business and which have not been provided for in these accountssince no actual liability is expected to arise: Six months Six months Year ended ended 31 July ended 31 July 31 January 2007 2006 2007 £m £m £mObligations under forward foreign exchange contract 70.9 29.5 94.2 20 Post balance sheet events On 17 September 2007 Kesa completed the acquisition of Menaje Del HogarSociedad Anomima (MH), a Spanish specialist electrical retailer, fromfunds controlled by Impala Capital Partners and the Perez family.Consideration was €100m in cash together with the assumption of net debtof approximately €35m. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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