Interim Results - Part 2

Inchcape PLC
6 August 2001



PART 2



Consolidated profit and loss account
for the six months ended 30 June 2001
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                    £m           £m         £m
___________________________________________  __________  __________  _________
Turnover including share of joint ventures
and associates                                 1,755.4      2,025.4   3,717.4
Less:
- share of joint ventures                        (25.6)       (35.6)    (61.1)
- share of associates                            (88.6)      (427.1)   (570.2)
___________________________________________  __________  __________  _________
Group subsidiaries' turnover                   1,641.2      1,562.7    3,086.1
===========================================  ==========  ==========  =========
Operating profit                                  46.5         30.9       72.0
Share of profits of joint ventures                 6.9          6.6       13.2
Share of profits of associates                     1.6          2.9        4.9
___________________________________________  __________  __________  _________
Total operating profit                            55.0         40.4       90.1
Net (loss) on disposal of properties and
investments                                       (1.8)        (0.1)     (0.4)
Net (loss) including provisions on sale
and termination of operations                     (7.1)       (15.4)    (18.5)
Utilisation of provision for net loss
on sale of operations                                -         15.4       18.2
                                             __________  __________  _________
                                                  (7.1)           -      (0.3)
___________________________________________  __________  __________  _________
Profit on ordinary activities before
net interest                                      46.1         40.3       89.4
Net interest:
Subsidiaries                                      (1.5)        (6.7)    (11.2)
Share of joint ventures                              -         (0.3)     (0.4)
Share of associates                               (1.0)        (3.4)     (4.4)
                                             __________  __________  _________
Total                                             (2.5)       (10.4)    (16.0)
___________________________________________  __________  __________  _________
Profit on ordinary activities before
taxation                                          43.6         29.9       73.4
Tax on profit on ordinary activities             (15.9)        (9.8)    (18.2)
___________________________________________  __________  __________  _________
Profit on ordinary activities after
taxation                                          27.7         20.1       55.2
Minority interests                                (5.0)        (3.8)     (7.6)
___________________________________________  __________  __________  _________
Profit for the financial period                   22.7         16.3       47.6
Dividends                                         (5.6)        (6.4)    (19.2)
___________________________________________  __________  __________  _________
Retained profit for the financial period          17.1          9.9       28.4
===========================================  ==========  ==========  =========
Headline profit before tax (£m)                   52.5         30.0       74.1
Headline earnings per share                       39.7p        18.6p     49.3p

FRS3 profit before tax (£m)                       43.6         29.9       73.4
Basic earnings per share                          27.2p        18.5p     54.2p
Diluted earnings per share                        27.1p        18.5p     54.2p
===========================================  ==========  ==========  =========

Details of the results of discontinued operations are given in note 1.


Statement of total recognised gains and losses
for the six months ended 30 June 2001
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                    £m           £m         £m
___________________________________________  __________  __________  _________
Profit for the financial period                   22.7         16.3       47.6
Effect of foreign exchange rate changes:
- results for the period                           1.0          0.6        0.8
- foreign currency net investments                 3.7         15.4       10.3
Unrealised (deficit) on impairment of
revalued properties                                  -            -      (0.3)
___________________________________________  __________  __________  _________
Total recognised gains                            27.4         32.3       58.4
===========================================  ==========  ==========  =========


Reconciliation of movements in shareholders' funds
for the six months ended 30 June 2001
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                    £m           £m         £m
___________________________________________  __________  __________  _________
Profit for the financial period                   22.7         16.3       47.6
Dividends                                         (5.6)        (6.4)    (19.2)
___________________________________________  __________  __________  _________
                                                  17.1          9.9       28.4
Effect of foreign exchange rate changes            4.7         16.0       11.1
Goodwill on disposals and written off              9.0            -        6.0
Deficit on impairment of revalued
properties                                           -            -      (0.3)
Shares purchased*                                (45.3)           -          -
___________________________________________  __________  __________  _________
Net change in shareholders' funds                (14.5)        25.9       45.2
Opening balance                                  365.3        320.1      320.1
___________________________________________  __________  __________  _________
Closing balance                                  350.8        346.0      365.3
===========================================  ==========  ==========  =========

* During the period, the Company returned funds to shareholders by making 
on-market purchases of 10,932,500 of its own Ordinary Shares of 150p each.  
These shares were then cancelled.  The average price paid was £4.12 per share,
and costs and stamp duty of £0.3m were incurred.


Summarised consolidated balance sheet
as at 30 June 2001
______________________________________________________________________________
                                                As at        As at      As at
                                              30.6.01      30.6.00   31.12.00
                                                   £m           £m         £m
_____________________________________________________________________________
Fixed assets:
Intangible assets                                 3.4          4.1        3.7
Tangible assets                                 243.1        264.8      244.5
Investments:
- joint ventures: share of gross assets         472.8        555.3      534.5
                  share of gross liabilities   (422.5)      (510.1)    (479.2)
                                             __________  __________  _________
                  share of net assets            50.3         45.2       55.3
- associates                                     41.5         59.4       43.5
- other investments                               4.0          9.8       12.9
___________________________________________  __________  __________  _________
                                                342.3        383.3      359.9

Current assets:
Stocks                                          461.3        501.4      530.1
Debtors                                         216.6        315.8      323.4
Investments                                      14.2          9.9       10.4
Cash at bank and in hand                        191.2        152.9      166.4
___________________________________________  __________  __________  _________
                                                883.3        980.0    1,030.3

Creditors - amounts falling due
within one year: 
Borrowings                                      (61.4)      (146.0)    (138.6)
Other                                          (543.5)      (521.2)    (566.5)
___________________________________________  __________  __________  _________
Net current assets                              278.4        312.8      325.2
___________________________________________  __________  __________  _________
Total assets less current liabilities           620.7        696.1      685.1

Creditors - amounts falling due
after more than one year:
Borrowings                                      (44.5)       (92.9)     (96.9)
Other                                           (61.2)       (73.0)     (61.8)
___________________________________________  __________  __________  _________
                                               (105.7)      (165.9)    (158.7)
Provisions for liabilities and charges         (116.5)      (133.4)    (113.9)
___________________________________________  __________  __________  _________
Net assets                                      398.5        396.8      412.5
===========================================  ==========  ==========  =========

Equity shareholders' funds                      350.8        346.0      365.3
Minority interests                               47.7         50.8       47.2
___________________________________________  __________  __________  _________
                                                398.5        396.8      412.5
===========================================  ==========  ==========  =========


Consolidated cash flow statement
for the six months ended 30 June 2001

Reconciliation of operating profit to operating cash flows
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                    £m           £m         £m
______________________________________________________________________________
Operating profit before exceptional
operating items                                  46.5         30.9       72.0
Amortisation and depreciation                    13.5         12.8       25.7
Loss on sale of tangible fixed assets 
other than property                                 -          0.2        1.2
Decrease (increase) in working capital           91.2         44.7       (2.0)
Payments in respect of exceptional
operating items                                    -            -       (1.3)
Payments in respect of termination of
operations                                       (1.5)        (0.2)      (1.1)
Other items                                       6.6          4.1       (4.0)
___________________________________________  __________  __________  _________
Net cash inflow from operating activities       156.3         92.5       90.5
===========================================  ==========  ==========  =========


Consolidated cash flow statement
______________________________________________________________________________
Net cash inflow from operating activities       156.3         92.5       90.5
Dividends from joint ventures                     4.5          5.2        5.9
Dividends from associates                         2.8          3.2        3.1
Returns on investments and servicing
of finance                                       (4.0)        (9.2)     (14.8)
Taxation                                        (11.5)        (8.6)     (12.4)
Capital expenditure and financial
investment                                      (14.4)       (13.5)     (21.1)
___________________________________________  __________  __________  _________
                                                133.7         69.6       51.2
Acquisitions and disposals                       17.6          9.8       48.2
Equity dividends paid                           (11.7)       (12.4)     (18.8)
___________________________________________  __________  __________  _________
Net cash inflow before use of liquid
resources and financing                         139.6         67.0       80.6
Net cash (outflow) from the management
of liquid resources                             (14.9)        (9.0)     (88.1)
Net cash (outflow) from financing*             (105.6)       (50.5)     (49.1)
___________________________________________  __________  __________  _________
Net increase (decrease) in cash                  19.1          7.5      (56.6)
===========================================  ==========  ==========  =========


Reconciliation of net cash flow to movement in net funds and debt
______________________________________________________________________________
Net increase (decrease) in cash                  19.1          7.5      (56.6)
Net cash outflow from decrease in debt
and lease financing                              60.4         50.5       49.1
Net cash outflow from the management
of liquid resources                              14.9          9.0       88.1
___________________________________________  __________  __________  _________
Change in net funds and debt resulting
from cash flows                                  94.4         67.0       80.6
Effect of foreign exchange rate changes
on net cash (debt)                                2.8         (2.0)      (1.4)
Net loans and finance leases of
subsidiaries acquired and sold                   70.6            -        1.0
Liquid resources of subsidiaries sold           (13.4)        (2.0)      (0.3)
___________________________________________  __________  __________  _________
Movement in net funds (debt)                    154.4         63.0       79.9
Opening net (debt)                              (69.1)      (149.0)    (149.0)
___________________________________________  __________  __________  _________
Closing net funds (debt)                         85.3        (86.0)     (69.1)
===========================================  ==========  ==========  =========

* Net cash outflow from financing includes £45.2m relating to the share 
buyback programme.


Notes to the accounts

1 Segmental analysis

______________________________________________________________________________
                                            Group turnover plus share of joint
                                                       ventures and associates
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                           restated   restated
By geographical market:                             £m           £m         £m
___________________________________________  __________  __________  _________
UK                                               556.3        555.2    1,008.9
Greece/Belgium                                   313.1        296.1      565.4
Australia/New Zealand                            235.1        223.5      448.9
Hong Kong                                        243.3        154.8      355.9
Singapore/Brunei                                 230.3        166.1      378.6
Other                                            142.9        134.8      267.8
___________________________________________  __________  __________  _________
                                               1,721.0      1,530.5    3,025.5
Central costs                                        -            -          -
___________________________________________  __________  __________  _________
Continuing                                     1,721.0      1,530.5    3,025.5
Discontinued                                      34.4        494.9      691.9
___________________________________________  __________  __________  _________
                                               1,755.4      2,025.4    3,717.4
===========================================  ==========  ==========  =========


1 Segmental analysis (continued)

______________________________________________________________________________

                                                        Total operating profit
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                           restated   restated
By geographical market:                             £m           £m         £m
___________________________________________  __________  __________  _________
UK                                                 8.7          4.7        0.7
Greece/Belgium                                     5.7          8.3       17.7
Australia/New Zealand                              8.8          6.8        7.9
Hong Kong                                         26.5         14.3       40.7
Singapore/Brunei                                   8.5          9.2       21.9
Other                                              1.5          2.9        5.7
___________________________________________  __________  __________  _________
                                                  59.7         46.2       94.6
Central costs                                     (6.0)       (10.0)    (16.3)
___________________________________________  __________  __________  _________
Continuing                                        53.7         36.2       78.3
Discontinued                                       1.3          4.2       11.8
___________________________________________  __________  __________  _________
                                                  55.0         40.4       90.1
===========================================  ==========  ==========  =========


1 Segmental analysis (continued)

______________________________________________________________________________
                                            Group turnover plus share of joint
                                                       ventures and associates
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                           restated   restated
By activity:                                        £m           £m         £m
___________________________________________  __________  __________  _________
Import, Distribution & Retail                  1,308.7      1,119.7    2,290.8
UK Retail                                        350.5        352.0      621.5
Financial Services                                61.5         58.0      112.1
E-commerce                                         0.3          0.8        1.1
___________________________________________  __________  __________  _________
                                               1,721.0      1,530.5    3,025.5
Central costs                                        -            -          -
___________________________________________  __________  __________  _________
Continuing                                     1,721.0      1,530.5    3,025.5
Discontinued                                      34.4        494.9      691.9
___________________________________________  __________  __________  _________
                                               1,755.4      2,025.4    3,717.4
===========================================  ==========  ==========  =========


1 Segmental analysis (continued)

______________________________________________________________________________

                                                        Total operating profit
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                           restated   restated
By activity:                                        £m           £m         £m
___________________________________________  __________  __________  _________
Import, Distribution & Retail                     50.3         39.0       84.7
UK Retail                                          6.7          5.5        8.8
Financial Services                                 7.3          5.7        9.0
E-commerce                                        (4.6)        (4.0)     (7.9)
___________________________________________  __________  __________  _________
                                                  59.7         46.2       94.6
Central costs                                     (6.0)       (10.0)    (16.3)
___________________________________________  __________  __________  _________
Continuing                                        53.7         36.2       78.3
Discontinued                                       1.3          4.2       11.8
___________________________________________  __________  __________  _________
                                                  55.0         40.4       90.1
===========================================  ==========  ==========  =========

Discontinued operations in the six months to 30 June 2001 comprised primarily 
IRB Finance Berhad, Mazda France and the Jaguar Import and Distribution 
business in Australia.  Prior year figures have been restated accordingly.

Also included in discontinued are Toyota (GB), the Volkswagen Passenger Import

and Distribution business in Australia, activities in China and two 
agricultural and industrial vehicle activities in Latin America.  These 
activities were treated as discontinued in 2000.


2 Analysis of turnover and total operating profit
______________________________________________________________________________
                                                                      Turnover
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                           restated   restated
                                                    £m           £m         £m
___________________________________________  __________  __________  _________
Continuing:
The Company and its subsidiaries               1,607.4      1,399.7    2,782.2
Joint ventures                                    25.0         25.6       46.8
Associates                                        88.6        105.2      196.5
___________________________________________  __________  __________  _________
Continuing                                     1,721.0      1,530.5    3,025.5
___________________________________________  __________  __________  _________
Discontinued:
The Company and its subsidiaries                  33.8        163.0      303.9
Joint ventures                                     0.6         10.0       14.3
Associates                                           -        321.9      373.7
___________________________________________  __________  __________  _________
Discontinued                                      34.4        494.9      691.9
___________________________________________  __________  __________  _________
                                               1,755.4      2,025.4    3,717.4
===========================================  ==========  ==========  =========


2 Analysis of turnover and total operating profit (continued)
______________________________________________________________________________
                                                        Total operating profit
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                           restated   restated
                                                    £m           £m         £m
___________________________________________  __________  __________  _________
Continuing:
The Company and its subsidiaries                  45.3         27.9       62.0
Joint ventures                                     6.8          6.5       12.5
Associates                                         1.6          1.8        3.8
___________________________________________  __________  __________  _________
Continuing                                        53.7         36.2       78.3
___________________________________________  __________  __________  _________
Discontinued:
The Company and its subsidiaries                   1.2          3.0       10.0
Joint ventures                                     0.1          0.1        0.7
Associates                                           -          1.1        1.1
___________________________________________  __________  __________  _________
Discontinued                                       1.3          4.2       11.8
___________________________________________  __________  __________  _________
                                                  55.0         40.4       90.1
===========================================  ==========  ==========  =========


3 Basis of presentation
______________________________________________________________________________

The results for the periods to 30 June have been prepared using the discrete 
period approach (i.e. considering them as accounting periods in isolation).  
The Headline tax charge is based on the effective tax rates estimated for the 
full year in the Group's major countries of operation being applied to the 
actual profits for the first half.

These unaudited interim financial statements do not constitute statutory 
accounts and have been prepared on the basis of the accounting policies set 
out in the Annual Report & Accounts 2000.  FRS18 'Accounting Policies' has 
been adopted in the period with no effect on the Group's accounting policies 
or results.

The results for the year ended 31 December 2000 have been abridged from the 
Group's published financial statements, which have been reported on by the 
Group's auditors and filed with 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.


The major exchange rates applied are as follows:

______________________________________________________________________________
                                   Average rates              Period end rates
                      __________________________    __________________________

                      30.6.01  30.6.00  31.12.00    30.6.01  30.6.00  31.12.00
______________________________________________________________________________
Australian dollar        2.78     2.59      2.62       2.77     2.52      2.69
Euro                     1.61     1.64      1.65       1.66     1.58      1.59
Greek drachma             550      550       555        566      532       542
Hong Kong dollar        11.23    12.22     11.84      10.97    11.80     11.65
Singapore dollar         2.57     2.69      2.62       2.56     2.62      2.59
US dollar                1.44     1.57      1.52       1.41     1.51      1.49
______________________________________________________________________________


4 Exceptional items
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
                                                    £m           £m         £m
___________________________________________  _________   __________  _________
Net (loss) on disposal of properties
and investments*                                 (1.8)        (0.1)      (0.4)
Net (loss) profit including provisions on
sale and termination of operations:
- Seaking Automotive Ltd (includes goodwill
written off: £5.3m)                              (7.8)           -          -
- Newport Ford dealership (includes goodwill
written off: £3.7m)                              (4.0)           -          -
- IRB Finance Berhad                              3.9            -          -
- Other**                                         0.8            -       (0.3)
                                             _________   __________  _________
                                                 (7.1)           -       (0.3)
___________________________________________  _________   __________  _________
Total exceptional items                          (8.9)        (0.1)      (0.7)
===========================================  =========   ==========  =========

During the six months ended 30 June 2001 the Group disposed of various 
businesses.  The principal profit and losses on those transactions are noted 
above and in the Chairman's Statement.

Goodwill written off included above of £9.0m (interim 2000 -£nil) had been 
charged against reserves in previous years.

* Net loss on disposal of properties and investments includes a £2.1m charge 
relating to the write down of the investment in Autobytel Europe following 
Autobytel.com's decision to wind down this business.

** Included in Other for the year 2000 is a profit of £14.0m on the sale of 
Toyota (GB), and losses on the sale of the following operations: Nanjing Hong 
Kong Changjiang (£6.2m), John Deere Peru (£3.1m) and Towell Auto Centre Oman 
(£3.0m).


5 Earnings per ordinary share
______________________________________________________________________________
                                            Six months   Six months   Year to
                                            to 30.6.01   to 30.6.00  31.12.00
Based on the profit for the period:                 £m           £m        £m
______________________________________________________________________________
Headline profit before tax                       52.5         30.0      74.1
Taxation on Headline profit                     (15.9)        (9.8)    (23.2)
Minority interests in Headline profit            (3.5)        (3.8)     (7.6)
___________________________________________  _________   __________  _________
Headline earnings                                33.1         16.4      43.3
Exceptional items - note 4                       (8.9)        (0.1)     (0.7)
Taxation on exceptional items                       -            -       5.0
Minority interests in exceptional items          (1.5)           -         -
___________________________________________  _________   __________  _________
Earnings                                         22.7         16.3      47.6
___________________________________________  _________   __________  _________

Headline earnings per share                      39.7p        18.6p     49.3p
Basic earnings per share                         27.2p        18.5p     54.2p
Diluted earnings per share                       27.1p        18.5p     54.2p
===========================================  =========   ==========  =========

The weighted average number of fully paid shares in issue during the period, 
excluding those held by the Inchcape Employee Trust, was 83.4m (interim 2000 
- 88.2m; full year 2000 - 87.8m).

The diluted earnings per share arises from deferred bonus shares and the 
exercise of share options that satisfy relevant performance criteria.  It is 
calculated by adjusting the weighted average number of ordinary shares for the

dilution, where the exercise price is less than the average market price of 
the Company's ordinary shares during the period.  The adjusted weighted 
average number of ordinary shares was 83.8m (interim 2000 - 88.2m; full 
year 2000 - 87.8m).

Headline profit before tax and earnings (before exceptional items and after 
the utilisation of termination provisions) are adopted in that they provide a 
representation of underlying performance.


6 Taxation
______________________________________________________________________________
                                            Six months   Six months    Year to
                                            to 30.6.01   to 30.6.00   31.12.00
The charge for taxation includes
the following:                                      £m           £m         £m
______________________________________________________________________________
Overseas taxes                                    13.3          8.6       27.7
Joint ventures                                     1.9          1.1        2.5
Associates                                         0.2          0.4        0.1
===========================================  =========   ==========  =========


7 Dividends
______________________________________________________________________________
The interim dividend of 8.8p per ordinary share (interim 2000 - 7.3p) will be 
paid on 17 September 2001 to shareholders on the register on 17 August 2001.

The dividend charge of £5.6m for 2001 is net of a £1.1m benefit resulting from
a lower 2000 final dividend charge than was accrued in the 2000 financial
statements.  This benefit was due to the share buyback programme reducing the
number of shares on the register at the record date.


8 Post balance sheet events
______________________________________________________________________________
On 1 August 2001, MCL Group Ltd, our 40.0% owned associate, sold its Mazda UK 
Import and Distribution business to the manufacturer.  Historic goodwill, 
already written off to reserves in the balance sheet, of £24.5m will be 
written off in the second half in accordance with FRS10.  MCL does not 
anticipate a material profit or loss on this transaction.