Pendragon PLC
22 July 2005
PENDRAGON PLC - ADOPTION OF INTERNATIONAL FINANCIAL REPORTING STANDARDS
Pendragon PLC, the largest car retailer in the UK, has published today its
report explaining the effects of the introduction of International Financial
Reporting Standards (IFRS) on its previously reported results for the year
ended 31 December 2004. The full report is available on Pendragon's website
(address http://www.pendragonplc.com/news.asp?newsid=612).
Background
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 IFRS for accounting
periods beginning on or after 1 January 2005. The group's first annual report
under IFRS will be for the year to 31 December 2005 with the first IFRS interim
results for the six months ended 30 June 2005.
The report available on the website explains the main changes that are required
to the group's financial statements on adoption of IFRS. The financial
information presented is unaudited. The report is set out in the following
sections:
•Summary of IFRS changes
•Basis of preparation
•IFRS1 - first time adoption rules
•Accounting policy changes and financial effect
•Group balance sheet transition reconciliation as at 1 January 2004 and 31
December 2004 and 30 June 2004
•Group income statement transition reconciliation for the year ended 31
December 2004 and six months ended 30 June 2004
Summary of IFRS changes
The changes to the 2004 results arising from the implementation of IFRS are
summarised in the table below. To aid comparison, the results under UK GAAP have
been included in this table. IFRS terminology has been used in the transition
reconciliations.
Results year ended 31 December 2004 UK GAAP IFRS
£m
Underlying operating profit 91.2 87.7
Goodwill amortisation/impairment (9.7) (1.9)
Exceptional costs of integration (4.7) (4.7)
Operating Profit 76.8 81.1
Profit on disposal of fixed assets 18.9 18.9
Profit before interest 95.7 100.0
Interest (30.7) (34.6)
Profit before tax 65.0 65.4
Tax (20.9) (19.7)
Profit after tax 44.1 45.7
EPS - basic (pence) 35.9 37.1
EPS adjusted (pence) 33.9 30.0
The net effect on the 2004 results of the changes arising on transition to IFRS
is to increase the group profit after tax by £1.6m which increases basic
earnings per share by 1.2 pence per share. Adjusted earnings per share, based
on underlying operating profit less interest cost and the associated tax
charge, reduces by 3.9 pence per share principally due to a one off restatement
of the profit generated on acquisitions undertaken last year.
The main effect of the IFRS changes is to increase net assets and distributable
reserves of the group by £41.2m as at 31 December 2004. The main increases in
net assets are £78.8m due to the restatement of land and buildings to fair
value and £7.4m due to the deferment of the final dividend for 2004 into the
subsequent accounting period. The main reductions in net assets arise with the
recognition of pension scheme deficit of £31.9m and an increase in deferred tax
liability of £13.9m.
All the adjustments are explained in greater detail in the full report.
Pendragon will be holding an IFRS presentation this morning at 10.30 at Finsbury
Group, 52 - 58 Tabernacle Street, EC2A 4NJ. The interim results for the six
months ending 30 June 2005 will be published on 4 August 2005.
For further information, contact;
http://www.pendragonplc.com/news.asp?newsid=612
This link will take the reader to the announcement on the plc website from where
the full report can be accessed.
Pendragon PLC
David Forsyth - Finance Director (01623 725 114)
Richard Hamblin - Group Financial Controller (01623 725 114)
Finsbury Group
Gordon Simpson (0207 251 3801)
This information is provided by RNS
The company news service from the London Stock Exchange
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