4th Aug 2005 07:00
Pendragon PLC04 August 2005 FOR IMMEDIATE RELEASE 4 August 2005 INTERIM RESULTS TO 30 JUNE 2005 Pendragon PLC, the UK's largest motor car retailer, today reports interimresults for the six months to 30 June 2005. Highlights: - Turnover of £1,751 million (2004: £1,598 million)- Profit before tax & exceptionals £36.8 million (2004: £30.8 million)- Underlying operating margin 3.2% (2004: 2.9%)- Adjusted earnings per share up 22% to 20.7 pence (2004: 16.9 pence)- Interim dividend up 57% to 6.6 pence (2004: 4.2 pence)- Gearing 95% (2004: 140%) Trevor Finn, Chief Executive, commented: "I am pleased with the trading performance in all parts of the group'sactivities in the first half. We have increased profits and dividends whilst atthe same time reduced borrowings. These good results leave us well positioned toachieve our full year objectives. Our range of brands and activities has enabledus to carry on producing good results even though the trading conditions in theUK have become tougher this year. The performance of the group in the first half gives us confidence that we willmeet our objectives for the year. We will continue to grow our business in linewith our strategic plans and use our new technology systems to continue to improve the efficiency of our retailing business model." Enquiries: Pendragon PLC Trevor Finn, Chief Executive Tel: 01623 725 114 David Forsyth, Finance Director Finsbury Charlotte Hepburne-Scott Tel: 0207 251 3801 Gordon Simpson CHIEF EXECUTIVE'S OPERATIONAL REVIEW Introduction Trading performance across the Group has been good in the first six months ofthe year. We are reporting growth in underlying earnings and a further reductionin gearing. Whilst we have made a number of small acquisitions this year, themain focus has continued to be on increasing efficiency through furtherdeployment of our own dealer management systems and the integration of the majoracquisition we made last year. We consider the integration to be complete andachieved with no disruption to the profit generation of the Group. Group revenues have increased by £152.8 million to £1,751.2 million mainly as aresult of two extra months of trading from businesses acquired last year. On alike for like basis revenues were in line with last year despite a fall of 5.8%in new car registrations in the UK market. Operating profits before one offexceptional items were £56.7 million compared to £46.4 million last year.Although the UK market has been more competitive we have improved the overallGroup underlying operating profit margin to 3.2% from 2.9%. This reflects thestrength of the Group over a number of brands, markets and activities. The interim dividend is 6.6 pence per share compared to 4.2 pence last year.This level of dividend is in line with our decision to increase the 2004 finaldividend made in the light of the contribution to earnings of our substantialacquisition last year. We have now adopted International Financial Reporting Standards (IFRS) and haverestated the prior year figures to reflect the changes made to our accountingpolicies. Results and Dividend The results for the six months to 30 June 2005 are summarised as follows: 2005 2004 £m £m-------------------------------------------------------------------------------Revenue 1,751.2 1,598.4-------------------------------------------------------------------------------Underlying operating profit 56.7 46.4-------------------------------------------------------------------------------Exceptional operating costs (2.9) (4.3)-------------------------------------------------------------------------------Operating profit before other income 53.8 42.1-------------------------------------------------------------------------------Other income - gain on sale of fixed assets 1.4 11.6-------------------------------------------------------------------------------Operating profit 55.2 53.7-------------------------------------------------------------------------------Finance costs (19.9) (15.6)-------------------------------------------------------------------------------Profit before tax 35.3 38.1-------------------------------------------------------------------------------Earnings per share - adjusted 20.7p 16.9p-------------------------------------------------------------------------------Dividend per share 6.6p 4.2p------------------------------------------------------------------------------- Revenue has increased to £1,751.2 million from £1,598.4 million. CD Bramall wasacquired on 1 March 2004 and therefore the 2005 results include an additionaltwo months trading. On a like for like basis revenues have been maintained at2004 levels. Sale of new cars account for just over half of the revenue of thegroup with used cars accounting for a third. Aftersales activities account forthe balance of revenues and contributed 44% of gross profits. These percentagesare consistent with the prior period. Operating profit, excluding exceptional costs and disposal profits, increased by£10.3 million to £56.7 million from £46.4 million in 2004. We have benefitedfrom a full six months of contribution from acquisitions made in the first halflast year, good performances of certain brands in the UK, strong results in theUSA and a reduction in the level of losses in Germany. Financing costs increased by £4.3 million to £19.9 million. This was due to acombination of factors including higher vehicle floorplan costs, interest raterises and higher average borrowings compared to the first half last year. Thelevel of borrowings at 30 June 2005 was £20.5 million lower than that at 31 December 2004 and we are achieving our internal targets for debt reductionfollowing last year's major acquisition. The balance sheet gearing at 30 June2005 was 95% compared to 112% at 31 December 2004 and 140% at 30 June 2004. Exceptional operating costs of £2.9 million relate to write offs and costs inrespect of our Rover dealerships. Of this amount £1.2 million relates togoodwill written off with the remainder being redundancy costs and manufacturerand warranty debts. Of the original 16 Rover sites which we operated at thebeginning of the year, three have been closed and the properties are being sold.Three others have been closed as Rover dealers and will be reopened underdifferent franchises. The remaining ten sites continue to sell Rover cars andprovide aftersales to our customers and have had additional franchises added orwill have in due course. We expect to fully recover the exceptional costsincurred in our Rover group through the profits which will be made on the Roverproperty disposals. Underlying operating profit of £56.7 million (2004: £46.4 million) less interestcost of £19.9 million (2004: £15.6 million) resulted in profit before tax andexceptionals of £36.8 million (2004: £30.8 million). Adjusted earnings per shareincreased by 22.5% to 20.7p from 16.9p last year. Motor Retail Business Our franchised motor retail activities are principally in the UK with a smallbut growing business in the USA. We currently operate 258 franchised salespoints, of which 22 are overseas. We continue to represent a broad portfolio ofbrands each with sufficient scale to enable efficient operations within eachfranchise group. We also operate a number of franchised commercial truckbusinesses. We have progressed well with the implementation of our new dealer managementsystem, Pinnacle, within the group. So far we have installed systems at 63 sitesand plan a further 45 by this year end. We expect that the roll out willcontinue to accelerate and with it the benefits that this technology brings tothe operational efficiency of the Group. UK In the UK, new car registrations reduced by 5.8% compared to the first sixmonths of 2004. The 2004 comparative period is the best on record whilst the UKmarket in 2005 remains in line with the average achieved in the last six years.The private sector retail sales, which tend to be more profitable, are down 11%, whilst corporate sales are down only 2.3%. The change in mix has put pressure on margins within the sector. The latest industry forecast for 2005 is for an annual new car market at 2.45 million, down 4.6% on 2004. This annual forecast compares to a 7.2% fall in quarter one and reflects the cooling in demand last year from quarter two onwards. The commercial vehicle market continues to perform strongly. Year to date registrations of light commercial vans and trucks are up 3% to just over 200,000 registrations. In the UK we operate 236 franchised sales points representing specialist brands(44%), volume and motorbikes (47%) and truck franchises (9%). The results of theUK business can be summarised as follows: £m Revenue Gross Profit Gross Margin % Underlying Underlying Operating Operating Profit Margin %-------------------------------------------------------------------------------Existing 1,537.8 207.8 13.5 49.1 3.2-------------------------------------------------------------------------------Disposed 48.0 8.0 16.6 0.3 0.6-------------------------------------------------------------------------------Total 2005 1,585.8 215.8 13.6 49.4 3.1-------------------------------------------------------------------------------Total 2004 1,470.8 198.3 13.5 39.4 2.7------------------------------------------------------------------------------- Revenue increased by £115.0 million. This arose principally from a combinationof an additional two months from CD Bramall dealerships less the impact of yearon year disposals. Gross margins for dealerships we operated at 30 June 2005 were maintained at13.5%, despite the change in mix of national new car sales towards lower margincorporate. The split of profits from each of our activities has remained in linewith last year with 44% from the high margin aftersales area of the business.The cost savings accruing from the increased scale of the Group this year andsome excellent performances from our Aston Martin, Porsche and DAF franchisegroups have contributed towards operating margins increasing to 3.2% from 2.7%last year. We had a fairly quiet first half in terms of acquisitions and disposals. Weacquired four dealerships towards the end of the first half of 2005. A Jaguarand Volvo dealership in Plymouth, Jaguar in Solihull and Kia in Cardiff. We alsoestablished a greenfield site in Nottingham for SAAB, and rolled out ourCadillac sales centres to Manchester and Birmingham. We plan to open furtherCadillac centres in the second half of the year in anticipation of new modellaunches early next year. The contribution to revenue from these new businessesis not significant in the context of our UK operations although they have hadthe effect of reducing margins and operating profit in the first six months of2005. We sold our Mercedes truck operation in June in addition to the closure of partof our Rover Group. The demise of MG Rover car production has resulted in someexceptional costs to the group which we expect to recover through sale ofproperties from the Rover dealerships which we have closed. We expect to sellout of our remaining new Rover and MG stock in the second half of the year andto continue with the refranchising plans commenced last year. USA The overall market for new cars in the USA has improved this year by 1.9% to 8.6million registrations. We continue to represent only a few brands in Californiabeing Jaguar, Land Rover, Lincoln Mercury, Aston Martin and SAAB. We added thetwo SAAB dealerships in January of this year. All our brands are performing wellin terms of sales volumes other than Jaguar which has suffered due to lowerX-type sales. Results of the USA business for the first half of 2005 aresummarised as follows: £m Revenue Gross Profit Gross Margin % Underlying Underlying Operating Operating Profit Margin %-------------------------------------------------------------------------------Existing 90.3 14.2 15.8 2.8 3.1-------------------------------------------------------------------------------Acquired 10.2 1.1 10.6 (0.3) (2.7)-------------------------------------------------------------------------------Total 2005 100.5 15.3 15.2 2.5 2.5-------------------------------------------------------------------------------Total 2004 77.8 14.0 18.0 2.3 2.9------------------------------------------------------------------------------- Revenues increased, in part due to a number of large fleet deals for LincolnMercury product which had the effect of diluting the gross margin. Jaguar andLand Rover margins are also down on last year, Jaguar due to lower volumesincreasing competition and Land Rover awaiting new product launches. In June2005 we saw an improvement in Land Rover margins with the launch of the RangeRover Sport and the new supercharged Range Rover. Operating profit improved at the existing businesses by 22% to £2.8 million.This reflects the reduction in the cost base achieved of circa £0.3 millionwhilst increasing revenue. The two new SAAB dealerships acquired at the start of the new year is animportant step in both building on the relationship we enjoy with General Motorsin the UK and, also in extending the franchises we represent in the Californianmarket which hitherto had been entirely with Ford brands. The margins in the newSAAB businesses are below those of our existing dealers presenting us with theopportunity to improve their returns. Germany Our German operation, representing Jaguar, Land Rover and Aston Martin inFrankfurt and Munich has shown a marginal improvement with a reduction inoperating losses of £0.3 million. This was achieved through higher sales and animproved gross margin. The cost base remained static after reductions made lastyear. Support Services We provide a broad range of support services to both the Pendragon group and tooutside customers. The services are provided by a number of specialistbusinesses which comprise contract hire and leasing, computer softwaresolutions, wholesale parts distribution and our shared services centre. Theresults for the first half of 2005 are summarised as follows: £m Revenue Gross Profit Gross Margin % Underlying Underlying Operating Operating Profit Margin %-------------------------------------------------------------------------------Total 2005 76.1 20.9 27.5 5.7 7.5-------------------------------------------------------------------------------Total 2004 63.8 18.2 28.5 5.9 9.2------------------------------------------------------------------------------- Revenue increased with a full six month contribution from the contract hire andparts wholesale businesses that were acquired last year. As a consequence therelative mix of sales has changed which has had the effect of reducing year onyear margins. Overall profits have fallen slightly. Finance Our borrowings at 30 June 2005 were £226.3 million, a reduction of £20.5 millionfrom the 2004 year end balance of £246.8 million. Gearing at 30 June 2005 was95%. The level of borrowings is within the plan we set ourselves at the time ofthe acquisition of CD Bramall and gearing is continuing to fall. Operating cash inflow for the first six months was £80.9 million, which compareswith £118.6 million generated in 2004. We reduced working capital investment inthe period by £2.7 million in comparison to the reduction of £46.5 millionfollowing the CD Bramall acquisition last year. As the new car market has slowedthis year there has been extra focus, across the group, on new and used carstock levels to ensure they remain at appropriate levels. Investments of £13.0 million were made in respect of business acquisitions. Thisincludes the acquisitions of SAAB, in the USA, Jaguar and Volvo in Plymouth,Jaguar Solihull and Kia in Cardiff. Deferred consideration was paid for theCitroen/Jeep business that we acquired in September 2004. Net investment in property, plant and equipment for the six months was £24.2million (2004: £1.0 million). This includes investment in new properties andrefurbishments plus a net increase in the contract hire fleet and service loancars. Proceeds from property disposals were £5.9 million (2004: £22.0 million).In addition to this £14.0 million was raised from business disposals (2004: £14.3 million) Current Trading and Prospects Current trading remains in line with expectations as we continue to absorb theeffects of the downturn in the UK new car market with minimal impact on ourprofits. However, there is no doubt that had demand continued at levelsexperienced during the first quarter of 2004 profitability would be much higherthis year. Compared to last year, profits continue to be more difficult togenerate. The aftersales market is stable and currently appears tobe little affected by reductions in consumer spending. Looking forward to the remainder of the year we anticipate that trading willremain in line with expectations. We anticipate debt reduction to continue fromstrong cashflow, Pinnacle roll out to enable increased scale economies and thatour plans for growth will be achieved. We are confident the group will continue to build upon the success we haveachieved over the last eighteen months and will meet our short term goals whilstbuilding for our long term future. TREVOR FINNChief Executive4 August 2005 Consolidated Income Statement Interim Resultsfor the six months ended 30 June 2005 6 Months to 6 Months to 12 Months to 30.06.05 30.06.04 31.12.04 £m £m £m-------------------------------------------------------------------------------Revenue 1,751.2 1,598.4 3,168.2-------------------------------------------------------------------------------Cost of sales (1,499.8) (1,369.8) (2,718.1)-------------------------------------------------------------------------------Gross profit 251.4 228.6 450.1-------------------------------------------------------------------------------Operating expenses (197.6) (186.5) (369.0)-------------------------------------------------------------------------------Operating profit before other income 53.8 42.1 81.1-------------------------------------------------------------------------------Other income - gain on sale of fixed assets 1.4 11.6 18.9-------------------------------------------------------------------------------Operating profit 55.2 53.7 100.0-------------------------------------------------------------------------------Operating profit before other income,analysed as:Before exceptional items 56.7 46.4 87.7Goodwill impairment (1.2) - (1.9)Closure and integration costs (1.7) (4.3) (4.7)-------------------------------------------------------------------------------Operating profit before other income 53.8 42.1 81.1-------------------------------------------------------------------------------Finance costs (note 5) (20.8) (15.8) (35.1)Finance income (note 6) 0.9 0.2 0.5-------------------------------------------------------------------------------Profit before tax 35.3 38.1 65.4 Taxation (note 7) (11.0) (12.0) (19.7)-------------------------------------------------------------------------------Profit attributable to equityholders of the parent 24.3 26.1 45.7-------------------------------------------------------------------------------Earnings per ordinary share (note 9) 19.7p 21.3p 37.8pDiluted earnings per ordinary share(note 9) 19.1p 20.6p 36.0p------------------------------------------------------------------------------- All amounts are unaudited Consolidated Balance Sheet 30.06.05 30.06.04 31.12.04 £m £m £m-------------------------------------------------------------------------------Non-current assetsProperty, plant and equipment 474.0 467.8 471.7Goodwill 164.6 190.3 172.8Other intangible assets 1.4 2.9 1.6Derivative financial instruments 5.7 - -Investment in associated company - 2.3 -------------------------------------------------------------------------------- Total non-current assets 645.7 663.3 646.1------------------------------------------------------------------------------- Current assetsInventories 471.0 422.8 446.8Trade receivables 119.4 127.8 84.0Other current assets 72.4 69.0 51.8Bank balances and cash equivalents 92.9 86.2 114.3------------------------------------------------------------------------------- Total current assets 755.7 705.8 696.9------------------------------------------------------------------------------- Total assets 1,401.4 1,369.1 1,343.0-------------------------------------------------------------------------------Current liabilitiesBank overdrafts (22.3) - -Short term borrowings (53.2) (24.8) (71.3)Trade and other payables (733.4) (683.1) (657.0)Current obligations under finance leases (1.2) (5.0) (1.1)Current tax payable (21.2) (20.8) (18.5)------------------------------------------------------------------------------- Total current liabilities (831.3) (733.7) (747.9)------------------------------------------------------------------------------- Non-current liabilitiesLong term borrowings (245.4) (338.5) (285.3)Deferred tax (5.5) (9.1) (5.5)Obligations under finance leases (2.8) (7.0) (3.4)Retirement benefit obligations (76.2) (71.6) (78.3)Long term provisions (2.1) (2.7) (2.2)------------------------------------------------------------------------------- Total non-current liabilities (332.0) (428.9) (374.7)------------------------------------------------------------------------------- Total liabilities (1,163.3) (1,162.6) (1,122.6)------------------------------------------------------------------------------- Net assets 238.1 206.5 220.4------------------------------------------------------------------------------- Shareholders' equityCalled up share capital 32.8 32.8 32.8Share premium 56.8 56.8 56.8Other reserves 15.1 15.1 15.1Translation differences (0.1) 0.1 (0.3)Profit and loss account 133.5 101.7 116.0------------------------------------------------------------------------------- Total shareholders' equity 238.1 206.5 220.4------------------------------------------------------------------------------- All amounts are unaudited Consolidated Cash Flow Statement 6 Months to 6 Months to 12 Months to 30.06.05 30.06.04 31.12.04 £m £m £m------------------------------------------------------------------------------- Cash flows from operating activitiesOperating profit 55.2 53.7 100.0Profit on sale of fixed assets (1.4) (11.6) (18.9)Depreciation and amortisation 23.0 29.9 58.7Share based payments 0.2 0.1 0.3Goodwill impairment 1.2 - 1.9Decrease in working capital 2.7 46.5 45.4-------------------------------------------------------------------------------Cash generated from operating activities 80.9 118.6 187.4Interest paid (20.1) (15.6) (26.4)Tax paid (10.2) (8.6) (19.3)------------------------------------------------------------------------------- Net cash from operatingactivities 50.6 94.4 141.7------------------------------------------------------------------------------- Cash flows from investing activitiesBusiness acquisitions (net of cash acquired) (13.0) (229.4) (232.5)Proceeds from sale of businesses 14.0 14.3 17.9Purchase of property, plant and equipment (69.0) (46.9) (132.5)Proceeds from sale of property,plant and equipment 44.8 45.9 133.3Receipts from sales of investments - 0.6 0.8------------------------------------------------------------------------------- Net cash used in investing activities (23.2) (215.5) (213.0)------------------------------------------------------------------------------- Cash flows from financing activitiesPayment of capital element offinance lease rentals (0.5) (1.7) (11.4)Repayment of unsecured bank loans - (92.8) (92.2)Repayment of loan notes (62.8) (0.5) (0.5)Proceeds from issue of unsecured loans - 301.8 294.6Repayment of unsecured loans (0.3) - -Dividends paid to shareholders (7.4) (4.7) (9.8)------------------------------------------------------------------------------- Net cash (used in) / generatedfrom financing activities (71.0) 202.1 180.7------------------------------------------------------------------------------- Effects of exchange rate changes (0.1) - (0.3)-------------------------------------------------------------------------------Net (decrease) / increase in cash and cash equivalents (43.7) 81.0 109.1Opening cash and cash equivalents 114.3 5.2 5.2------------------------------------------------------------------------------- Closing cash and cash equivalents (note 10) 70.6 86.2 114.3------------------------------------------------------------------------------- Consolidated Statement of Changes in Equity Share Share Other Translation Accumulated Total Capital Premium Reserves Differences Profit £m £m £m £m £m £m---------------------------------------------------------------------------------------------------------Balance at 1 January 2004 32.8 56.8 15.1 - 77.1 181.8 Currency translation differences - - - (0.3) - (0.3)Share based payments including tax credits - - - - 2.2 2.2Profit attributable to equity holders of the parent - - - - 45.7 45.7Dividends - - - - (9.8) (9.8)Disposal of own shares in share trusts - - - - 0.8 0.8--------------------------------------------------------------------------------------------------------- Balance at 31 December 2004 32.8 56.8 15.1 (0.3) 116.0 220.4Adoption of IAS 39 - - - - 0.4 0.4--------------------------------------------------------------------------------------------------------- Balance at 1 January 2005 32.8 56.8 15.1 (0.3) 116.4 220.8 Currency translation differences - - - 0.2 - 0.2Share based payments - - - - 0.2 0.2Profit attributable to equity holders of the parent - - - - 24.3 24.3Dividends - - - - (7.4) (7.4)--------------------------------------------------------------------------------------------------------- Balance at 30 June 2005 32.8 56.8 15.1 (0.1) 133.5 238.1--------------------------------------------------------------------------------------------------------- Notes 1. Pendragon has previously reported its results under UK Generally Accepted Accounting Principles (UK GAAP). Following adoption of Regulation 1606/2002 by the European Parliament in July 2002 all EU listed companies are required to report their consolidated financial statements under International Financial Reporting Standards (IFRS) for accounting periods beginning on or after 1 January 2005. This interim report has been prepared in accordance with all current IFRS (including International Financial Reporting Interpretations Committee pronouncements) in place for reporting to 31 December 2005. The IFRS applied are those that have been, or are expected to be, endorsed by the European Commission by the time the group prepares its first set of consolidated financial statements at 31 December 2005. The changes arising to the income statement on adoption of IFRS are relatively insignificant, whilst the net assets of the group increase by £34.7 million as at 1 January 2004 with a restatement in the value of assets which is in part offset by the pension fund deficit that has been recognised and an increase in the deferred tax liability of the group. A full report detailing the changes to Pendragon accounting policies and their financial effect was published on 22 July 2005 and is available on the company's website (http://www.pendragonplc.com/news.asp?newsid=612). The principal changes the group has made to its accounting policies on adoption of IFRS to those presented in the financial statements for the year ended 31 December 2004 are as follows: (accounting policies that have not changed with the introduction of IFRS have not been reproduced below). a) Tangible fixed assets - land and buildings have been restated to fair value as at 1 January 2004. b) Employee share options - the fair value of the options granted to employees are expensed to the income statement. c) Goodwill - is no longer amortised but is tested instead for impairment at least once a year. d) Intangible assets - are recognised on acquisition if they can be separately identified and reliably measured. e) Dividends - final dividends recognised once approved at AGM or interim dividends when approved by directors. f) Deferred tax - provided in full including capital gains that have been rolled over. g) Leases - buildings are treated as fixed assets if they are long term and all the risks and rewards have substantially transferred to the group. h) Revenue recognition - contract hire vehicles remain on balance sheet as fixed assets if the group has a future repurchase commitment. Profit is spread over the period of the lease. i) Employee pensions - the full deficit on the pension schemes is recognised on balance sheet, and future costs will be calculated in accordance with the 'corridor' approach. j) Financial instruments - asset and liability of financial derivatives are recognised on balance sheet. The application of IFRS has also changed the cash flow statement in terms of its presentation and lay out. 2. The comparative results for the year ended 31 December 2004 are not the company's statutory accounts for that financial year. Those accounts, which were prepared under UK GAAP, have been reported on by the company's auditors and delivered to the registrar of companies. The report of the auditors was unqualified and did not contain a statement under s237 (2) or (3) of the Companies Act 1985. 3. The interim report has been approved by the board of directors on 4 August 2005 and is unaudited. 4. Exceptional items incurred during the first half of 2005 total £2.9 million. This is in respect of our Rover Franchise Group, and consists of £1.2 million impairment of goodwill and £1.7 million for redundancy costs and non payment of manufacturer bonus and warranty debtors. Exceptional costs incurred during the first half of 2004 of £4.3 million are in respect of integration costs arising from the acquisition of CD Bramall PLC which included redundancy payments made to the former directors. 5. Finance costs 6 Months 6 Months 12 Months to 30.06.05 to 30.06.04 to 31.12.04 £m £m £m------------------------------------------------------------------------------- Interest payable on bank borrowings 5.9 6.1 13.2 Interest payable on loan notes 5.0 3.5 8.6 Vehicle stocking plan interest 8.3 4.3 9.4 Interest payable on finance leases 0.1 0.1 0.4 Unwinding of discounts in contract hire residual values 1.3 1.5 2.9 Interest on pension scheme obligations 0.2 0.3 0.8------------------------------------------------------------------------------- 20.8 15.8 35.3 Less interest capitalised - - (0.2)------------------------------------------------------------------------------- Total finance costs 20.8 15.8 35.1------------------------------------------------------------------------------- 6. Finance income 6 Months 6 Months 12 Months to 30.06.05 to 30.06.04 to 31.12.04 £m £m £m------------------------------------------------------------------------------- Fair value gains - interest rate swaps 0.2 - - Interest receivable on bank deposits 0.2 0.2 0.5 Other interest receivable 0.5 - -------------------------------------------------------------------------------- Total finance income 0.9 0.2 0.5------------------------------------------------------------------------------- 7. The effective tax rate for 2005 of 31.2% (2004 : 31.5%) is an estimate based upon the anticipated charge for the full year on profit on ordinary activities before taxation. 8. A dividend of 6.6p (2004 : 4.2p) net per ordinary share will be paid on 3 October 2005 to shareholders appearing on the register at the close of business on 9 September 2005. 9. Earnings per share 30.06.05 30.06.04 31.12.04 pence pence pence------------------------------------------------------------------------------- Basic earnings per share 19.7 21.3 37.1 Effect of non trading items 1.0 (4.4) (7.1)------------------------------------------------------------------------------- Adjusted earnings per share 20.7 16.9 30.0------------------------------------------------------------------------------- Diluted earnings per ordinary share 19.1 20.6 36.0------------------------------------------------------------------------------- The calculation of basic, diluted and adjusted earnings per share is based on: Number of shares (millions) 30.06.05 30.06.04 31.12.04 number number number------------------------------------------------------------------------------- Weighted average number of shares used in basic and adjusted earnings per share calculation 123.5 122.7 123.0 Weighted average number of dilutive shares under option 3.8 3.9 3.9------------------------------------------------------------------------------- Diluted weighted average number of shares used in diluted earnings per share calculation 127.3 126.6 126.9 Earnings 30.06.05 30.06.04 31.12.04 £m £m £m------------------------------------------------------------------------------- Earnings for basic and diluted earnings per share calculation 24.3 26.1 45.7 Non trading items: Profit on fixed asset and business disposals (1.4) (11.6) (18.9) Goodwill impairment 1.2 - 1.9 Exceptional costs 1.7 4.3 4.7 Tax effect of non trading items (0.2) 1.9 3.5------------------------------------------------------------------------------- Earnings for adjusted earnings per share calculation 25.6 20.7 36.9------------------------------------------------------------------------------- The directors consider that the adjusted earnings per share figures provide a better measure of comparative performance. 10. Cash and cash equivalents 30.06.05 30.06.04 31.12.04 £m £m £m------------------------------------------------------------------------------- Bank balances and cash equivalents 92.9 86.2 114.3 Bank overdrafts (22.3) - -------------------------------------------------------------------------------- 70.6 86.2 114.3------------------------------------------------------------------------------- 11. Net debt 30.06.05 30.06.04 31.12.04 £m £m £m------------------------------------------------------------------------------- Cash and cash equivalents (note 10) 70.6 86.2 114.3 Short term borrowings (53.2) (24.8) (71.3) Long term borrowings (245.4) (338.5) (285.3) Derivative financial instruments 5.7 - - Obligations under finance leases (4.0) (12.0) (4.5)------------------------------------------------------------------------------- (226.3) (289.1) (246.8)------------------------------------------------------------------------------- This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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