Preliminary Results 2002

Intertek Testing Services PLC 10 March 2003 Preliminary 2002 Results Announcement 10 March 2003 Intertek Testing Services plc (Intertek), the global testing, inspection and certification company, today announces its first set of preliminary results since its flotation in May 2002 for the year to 31 December 2002. FINANCIAL HIGHLIGHTS Turnover £461.1m Up 2.1% at actual exchange rates Up 6.1% at constant exchange rates Operating profit(1) £76.9m Up 10.2% at actual exchange rates Up 15.3% at constant exchange rates Operating margin 16.7% Up from 15.5% Operating cash flow(2) £60.2m Up 13.8% Profit before tax £53.9m Earnings per share(3) 27.1p Proposed final dividend per share 5.2p (1) Before goodwill amortisation and exceptional operating items and includes profits from associates (2) Before exceptional items and after capital expenditure (3) Basic earnings per share before exceptional items CHIEF EXECUTIVE OFFICER, RICHARD NELSON commented: I am delighted to report a strong set of results for 2002; we have delivered on the objectives that we set out when we floated last year. Turnover was up in all four divisions on a constant currency basis, demonstrating the strength of our business. The Labtest division, which tests textiles, toys and consumer goods and certifies systems, had an excellent year with growth across all areas of activity. The Caleb Brett division, which principally tests oil and chemicals, experienced difficult market conditions in its cargo inspection and testing business, which were offset by growth in the testing outsourced to Caleb Brett by oil and chemical companies. ETL SEMKO, our electrical testing business performed well in most areas of safety and performance testing, but the telecoms testing market continued to be depressed. Our Foreign Trade Standards business had an excellent year, operating with a low and flexible cost base. We remain confident of prospects for our business both for the year ahead and the future. ANALYSTS' MEETING There will be a meeting for analysts at 9.30am today at Goldman Sachs International, Peterborough Court, 133 Fleet Street, London EC4A 2BB. A copy of the presentation will be available on the website later today. CONTACT Richard Nelson, Chief Executive Officer Bill Spencer, Chief Financial Officer Aston Swift, Treasurer and Investor Relations Telephone: +44 (0) 20 7396 3400 as@itsglobal.com Katie Macdonald-Smith, Tulchan Communications Telephone: +44 (0) 20 7353 4200 kmacdonald-smith@tulchangroup.com Corporate website: http:// www.itsglobal.com/ High resolution images of Intertek Testing Services plc businesses are available to download, free of charge from http://www.vismedia.co.uk/. OPERATING AND FINANCIAL REVIEW REVIEW OF RESULTS FOR 2002 OVERVIEW Turnover for the Group was £461.1m, an increase of 6.1% over the previous year at constant exchange rates. At actual exchange rates, the increase was 2.1%. Growth was strong in Asia and Europe but there was lower turnover in America where market conditions were weak in the oil and chemical sectors and in telecommunications testing. However, each of the four operating divisions reported increased turnover in the year at constant exchange rates with Labtest delivering over 13% year on year growth. Total operating profit before goodwill amortisation and exceptional items improved by £10.2m to £76.9m, which was 15.3% at constant exchange rates. At actual exchange rates, the increase was 10.2%. Labtest, ETL SEMKO and FTS all delivered strong year on year growth while Caleb Brett reported a small decline due to depressed oil and chemical markets. The Group made one small acquisition in the year, costing £0.4m in total, which did not have a significant effect on the results. Group profit margins after central overheads increased by 1.3% to 16.7%. The performance of each of the divisions at constant exchange rates with an adjustment to actual exchange rates is shown below: Turnover Total operating profit(2) 2002 2001 Change 2002 2001 Change £m £m % £m £m % Labtest 123.8 109.3 13.3 41.5 33.9 22.4 Caleb Brett 172.8 168.4 2.6 16.3 16.5 (1.2) ETL SEMKO 104.7 99.9 4.8 14.0 12.4 12.9 Foreign Trade Standards 59.8 56.8 5.3 11.3 9.1 24.2 Central overheads - - - (6.2) (5.2) - Continuing operations at constant exchange rates(1) 461.1 434.4 6.1 76.9 66.7 15.3 Exchange rate adjustment - 17.0 - - 3.1 - As reported at actual average exchange rates 461.1 451.4 2.1 76.9 69.8 10.2 (1) 2002 and 2001 figures are stated at average exchange rates for 2002. (2) Total operating profit is stated before goodwill amortisation and exceptional items. REVIEW OF 2002 DIVISIONAL PERFORMANCE Operating profit referred to below is total operating profit before goodwill amortisation and exceptional items. LABTEST Labtest continued to perform strongly. At constant exchange rates, Labtest's turnover increased by 13.3% to £123.8m and operating profit increased by 22.4% to £41.5m. At actual exchange rates, reported turnover and operating profit growth was 8.2% and 16.6% respectively. Most of the growth came from Asia where textile testing, toy testing, inspection and social compliance audit continued to perform well as a result of increasing demand for quality by consumers, more safety standards, growing numbers of product variants, shorter product life cycles and the continuing migration of manufacturing from developed countries to Asia. Turnover in China grew strongly in the established operations in Shanghai and Shenzhen, the new hardlines laboratory in Shanghai and the new textile testing facility in Guangzhou. The division's operating margin, increased from 31.0% to 33.5% principally due to continued improvement in operating procedures in Hong Kong and growth in China where operating costs are lower than in Hong Kong. CALEB BRETT At constant exchange rates, turnover increased by 2.6% to £172.8m but operating profit declined by 1.2% to £16.3m. At actual exchange rates, reported turnover and operating profit declined 1.8% and 6.3% respectively. The cargo inspection and testing market accounted for 77% of the business. This part of the business operated in a competitive market. The oil market was slow, with a decline in fuel oil shipments in the United States at the start of the year due to the relatively warm winter and reduced oil shipments to power stations during the year because of low natural gas prices. Oil shipments generally were low due to stock levels being kept at a minimum. Caleb Brett's operating margin reduced from 9.8% to 9.4%. The decline in turnover in the traditional inspection business was more than offset by growth in the testing outsourced to Caleb Brett by oil and chemical companies. This segment showed modest growth, accounting for 23% of Caleb Brett's turnover. The number of customers interested in outsourcing continues to increase and the outlook for growth is positive. ETL SEMKO At constant exchange rates, ETL SEMKO's turnover increased by 4.8% to £104.7m and operating profit increased by 12.9% to £14.0m. At actual exchange rates, reported turnover and operating profit increased by 1.6% and 9.4% respectively. Growth was mainly due to there being more safety testing of household appliances manufactured in Asia for export to North America and Europe, increased safety and electrical testing in Sweden and increased testing of building products and HVAC equipment in North America. Telecom testing in the US and Europe together represented some 8% of the division's turnover, declined due to the lack of product development and therefore testing. This trend started in mid 2001 and continued for the rest of that year but stabilised mid 2002. The division's operating margin increased from 12.4% to 13.4%, mainly due to cost reductions in 2002 in the United States. FOREIGN TRADE STANDARDS FTS had a good year with strong growth in operating profit and improved margins. At constant exchange rates, turnover increased by 5.3% to £59.8m and operating profit increased by 24.2% to £11.3m. At actual exchange rates, reported turnover and operating profit increased by 3.3% and 18.9% respectively. The operating margin at constant exchange rates, increased from 16.0% to 18.9%. The increase in operating profit was primarily driven by the expansion of the pre-shipment inspection programme in Nigeria in the latter part of 2001. The Nigerian programme in its present form was due to terminate in June 2002 but has been extended. Turnover from the standards testing programme in Saudi Arabia (SASO) grew due to the addition of new products to the programme, but there were increased operating costs. On 29 May 2002, the Group announced that it had received notification from SASO that the programme may cease at the end of August 2002 but this proved not to be the case. The programme is well established and contractually it runs until at least August 2003. The pre-shipment inspection programmes in Kenya, Iran and Uzbekistan generated growth in operating profit but closure costs were incurred in connection with discontinued programmes in Uganda and Argentina. CENTRAL OVERHEADS Central overheads increased by 19.2% to £6.2m in the year, primarily due to additional costs involved in strengthening compliance and increased rent at the Group's head office in London. OPERATING EXCEPTIONAL ITEMS The Group reported an exceptional operating credit of £15.6m in 2002 compared to exceptional costs of £23.1m in 2001. The credit comprised cash received from Inchcape plc in connection with indemnified claims arising on the sale of Inchcape Testing Services in 1996, cash received from the Group's insurers in respect of costs provided in earlier years relating to litigation in respect of the discontinued Environmental Testing division and the recovery of certain FTS government debts previously provided against. INTEREST The Group's net interest charge before exceptional items for the year was £22.5m compared to £39.2m a year ago. The pre-flotation debt was repaid and new banking facilities were put in place in June and July 2002, which reduced the Group's interest charge in the second half of the year. Had this refinancing occurred on 1 January 2002, the interest charge for the year would have been approximately £10.5m. The Group incurred an exceptional finance charge of £15.5m in 2002. This comprised bond redemption fees of £7.3m and accelerated fee amortisation on repaid loans and share warrants of £8.2m. TAXATION Tax on profit before exceptional items was £16.0m, £0.7m lower than last year and the effective tax rate before exceptional items reduced from 56.6% to 29.7%. The main reason for the reduction in the effective tax rate was the reduced interest expense, which resulted from the reorganisation of the Group's capital structure following the IPO. The effective tax rate is expected to remain close to 30% in the foreseeable future. There was no tax impact from the exceptional items. The exceptional income is either permanently non-taxable, or is offset by brought forward losses. The exceptional expense is generally deductible but is not absorbed by current year taxable income. EARNINGS PER SHARE Basic earnings per share in the year before exceptional items were 27.1p. After exceptional items, this increased to 27.2p. An underlying earnings per share calculation is also shown which removes the impact of exceptional items and goodwill amortisation to give an underlying earnings per share of 27.8p. The Group's new capital and debt structure was put in place part way through the year, which impacted the interest and tax charges and the weighted average number of shares in issue. If the new capital and debt structure had been in place for the whole year, the pro-forma basic earnings per share would have been 27.1p. This provides a more reliable comparison of the underlying results of the Group when comparing with future periods. DIVIDEND No interim dividend was paid for the six months to 30 June 2002. A final dividend of 5.2p per share has been proposed, which subject to shareholder approval will be paid on 18 June 2003, to shareholders on the register at 6 June 2003. Going forward, the Group expects to recommend to shareholders, the payment of both an interim and a final dividend. SHAREHOLDERS' FUNDS The net profit after tax and minority interests for 2002 of £33.6m was reduced by a provision for the final dividend of £8.0m and an actuarial loss on the Group's defined benefit pension schemes of £6.5m and was increased by foreign exchange movements of £6.5m to reduce shareholders' deficit by £25.6m. The issue of new shares in the year increased shareholders' funds by £232.3m. Preference shares of £105.5m were redeemed during the year. At the end of 2002, shareholders' funds were in deficit by £90.5m compared to a deficit of £242.9m at 31 December 2001. The deficit arises principally from the write-off of goodwill in 1996 when the Group was purchased from its former owners. This amounted to £264.7m at 31 December 2002. Excluding this historic goodwill write-off, shareholders' funds would show a surplus of £174.2m at 31 December 2002. CASH FLOW Total operating cash inflow was £97.4m in the year, up £27.4m on last year. The increase is impacted by exceptional cash inflow in 2002 and exceptional cash outflow in 2001. The cash inflow in the year included exceptional net cash inflow of £13.6m relating to income from the settlement of claims against the Group's former parent, insurance refunds and debts collected from foreign governments which had previously been written off, offset by restructuring costs, legal fees and other costs. In 2001, there was exceptional net cash outflow of £8.7m, which related to fines and legal costs, net of insurance recoveries, and restructuring costs. Excluding exceptional cash flows, cash generated by operations was £83.8m (2001: £78.7m). In May 2002, the Group raised £232.7m, net of issue costs, from shareholders by floating on the London Stock Exchange. Shortly afterwards, new banking facilities were made available and existing debt, debentures and preference shares were repaid. ACCOUNTING POLICIES The accounting policies of the Group remain unchanged from last year. The Group elected to adopt FRS 17: Retirement benefits and FRS 19: Deferred tax in its 2001 accounts, ahead of the mandatory deadlines. There were net actuarial losses of £6.5 million on the Group's defined benefit pension schemes in the year and the net liabilities increased to £7.4 million. The actuarial pension losses are charged to shareholders' funds through the statement of recognised gains and losses and the pension liabilities are included in the Group balance sheet. GROUP PROFIT AND LOSS ACCOUNT for the year ended 31 December 2002 Pre exceptional Exceptional Total Pre Exceptional Total items items exceptional items items 2002 2002 2002 2001 2001 2001 £m £m £m £m £m £m Turnover - continuing operations 461.1 - 461.1 451.4 - 451.4 Cost of sales (356.3) - (356.3) (354.9) - (354.9) Gross profit 104.8 - 104.8 96.5 - 96.5 Administrative expenses (28.8) 15.6 (13.2) (27.7) (20.0) (47.7) Goodwill amortisation (0.9) - (0.9) (1.3) (3.1) (4.4) Total administrative expenses (29.7) 15.6 (14.1) (29.0) (23.1) (52.1) Group operating profit/(loss) 75.1 15.6 90.7 67.5 (23.1) 44.4 Share of operating profits of 0.9 - 0.9 1.0 - 1.0 associates Total operating profit/(loss) 76.0 15.6 91.6 68.5 (23.1) 45.4 Continuing operations 76.0 5.9 81.9 68.5 (10.7) 57.8 Discontinued operations - 9.7 9.7 - (12.4) (12.4) Profit/(loss) on ordinary activities 76.0 15.6 91.6 68.5 (23.1) 45.4 before interest Net interest and similar charges (22.5) (15.5) (38.0) (39.2) - (39.2) Other finance income 0.3 - 0.3 0.2 - 0.2 Profit/(loss) on ordinary activities 53.8 0.1 53.9 29.5 (23.1) 6.4 before taxation Taxation on profit/(loss) on (16.0) - (16.0) (16.7) - (16.7) ordinary activities Profit/(loss) on ordinary activities 37.8 0.1 37.9 12.8 (23.1) (10.3) after taxation Attributable to minorities (4.3) - (4.3) (4.4) - (4.4) Profit/(loss) for the financial year 33.5 0.1 33.6 8.4 (23.1) (14.7) Dividends (8.0) - (8.0) - - - Retained profit/(loss) for the year 25.5 0.1 25.6 8.4 (23.1) (14.7) Earnings/(loss) per share Basic 27.1p 0.1p 27.2p 10.4p (28.6)p (18.2)p Diluted 26.0p 0.2p 26.2p 10.4p (28.6)p (18.2)p GROUP BALANCE SHEET at 31 December 2002 2002 2001 £m £m Fixed assets Intangible assets - goodwill 12.1 12.1 Tangible assets 76.7 75.6 Investments Subsidiaries - - Associates 0.9 0.8 Other 1.1 0.1 TOTAL 90.8 88.6 Current assets Stocks 1.5 1.8 Debtors 101.0 104.7 Cash 70.6 23.7 TOTAL 173.1 130.2 Creditors due within one year Borrowings (15.0) (37.1) Other creditors (89.6) (97.2) (104.6) (134.3) Net current assets/(liabilities) 68.5 (4.1) Total assets less current liabilities 159.3 84.5 Creditors due after more than one year Borrowings (222.5) (304.0) Other creditors (4.1) (5.5) (226.6) (309.5) Provisions for liabilities and charges (8.7) (9.1) Net liabilities excluding pension schemes (76.0) (234.1) Pension assets/(liabilities) Schemes with net assets - 0.1 Schemes with net liabilities (7.4) (1.7) Net liabilities TOTAL (83.4) (235.7) Capital and reserves Called up share capital 1.5 106.3 Shares to be issued - 2.8 Share premium 231.6 - Merger reserve 3.6 3.6 Other reserves 2.8 - Profit and loss account (330.0) (355.6) Shareholders' deficit (90.5) (242.9) Minority shareholders' equity interest 7.1 7.2 Capital employed TOTAL (83.4) (235.7) Equity (83.4) (341.2) Non-equity - 105.5 Shareholders' deficit (83.4) (235.7) STATEMENT OF GROUP CASH FLOW for the year ended 31 December 2002 2002 2001 £m £m Net cash inflow from operating activities 97.4 70.0 Dividends received from associated undertakings 0.5 0.4 Returns on investments and servicing of finance (34.4) (28.4) Taxation (12.7) (13.6) Capital expenditure and financial investment (23.3) (25.5) Acquisitions and disposals (4.3) (1.5) Cash inflow before financing TOTAL 23.2 1.4 Financing Net issue of shares 127.2 - (Decrease)/increase in debt (97.1) 1.8 Increase in cash in the year TOTAL 53.3 3.2 Reconciliation of net cash flow to movement in net debt Increase in cash in the period 53.3 3.2 Cash inflow/(outflow) from decrease/(increase) in debt 97.1 (1.8) Decrease in net debt resulting from cash flows TOTAL 150.4 1.4 Debt issued in lieu of interest payments (6.1) (11.7) Acquisitions and disposals - 0.1 Other non-cash movements (5.4) (2.2) Exchange adjustments 11.6 (3.9) Decrease/(increase) in net debt in the year TOTAL 150.5 (16.3) Net debt at the start of the year (317.4) (301.1) Net debt at the end of the year (166.9) (317.4) .STATEMENT OF TOTAL GROUP RECOGNISED GAINS AND LOSSES 2002 2001 £m £m Net profit/(loss) from group companies 33.0 (15.3) Net profit from associates 0.6 0.6 Profit/(loss) for the financial year TOTAL 33.6 (14.7) Actuarial pension loss* (6.5) (3.3) Exchange adjustments 6.5 (4.9) Total recognised gains and losses relating to the year 33.6 22.9 RECONCILIATION OF MOVEMENTS IN SHAREHOLDERS' DEFICIT 2002 2001 £m £m Opening shareholders' deficit (242.9) (220.0) Issue of ordinary shares 232.3 - Redemption of preference shares (105.5) - Profit/(loss) for the financial year 33.6 (14.7) Dividend proposed (8.0) - Actuarial pension loss * (6.5) (3.3) Exchange adjustments 6.5 (4.9) Closing shareholders' deficit TOTAL (90.5) (242.9) *Actuarial pension loss is stated net of deferred tax HISTORICAL COST PROFITS AND LOSSES A note of consolidated historical cost profits and losses is not presented, as there is no material difference in either year between the profits of the Group as shown in these accounts and those shown on a historical cost basis. NOTES 1) SEGMENTAL INFORMATION The group comprises four operating divisions which are organised as follows: Labtest, which tests and inspects textiles, toys and other consumer products; Caleb Brett, which tests and inspects oil, chemicals and agricultural produce; ETL SEMKO, which tests and certifies electrical and electronic products, telecommunication equipment, building products and heating, ventilation and air conditioning equipment and Foreign Trade Standards, which provides standards programmes and Fiscal Good Governance programmes to standards bodies and governments. Central overheads comprise the costs of the corporate head office and non-operating holding companies. 2002 2001 Business analysis Turnover Total Net Turnover Total Net operating operating operating operating profit assets profit assets £m £m £m £m £m £m By activity Labtest 123.8 41.5 21.7 114.4 35.6 20.5 Caleb Brett 172.8 16.3 42.4 176.0 17.4 39.2 ETL SEMKO 104.7 14.0 37.9 103.1 12.8 43.3 Foreign Trade Standards 59.8 11.3 5.8 57.9 9.5 0.4 Central overheads - (6.2) 0.7 - (5.5) (1.2) TOTAL 461.1 76.9 108.5 451.4 69.8 102.2 Operating exceptional items - 5.9 - - (10.7) - Goodwill amortisation - (0.9) - - (1.3) - Continuing operations TOTAL 461.1 81.9 108.5 451.4 57.8 102.2 Discontinued operations - - 9.7 - - (12.4) - exceptional items TOTAL 461.1 91.6 108.5 451.4 45.4 102.2 By geographical origin Americas 166.0 16.4 50.8 177.8 13.9 53.8 Europe, Middle East and Africa 144.3 12.1 32.7 136.4 11.8 20.4 Asia 150.8 48.4 25.0 137.2 44.1 28.0 Continuing operations TOTAL 461.1 76.9 108.5 451.4 69.8 102.2 The operating profit shown by geographical origin is before goodwill amortisation and exceptional items. In 2002, Systems Certification Services was transferred from ETL SEMKO to Labtest. The 2001 figures for turnover and operating profit have been restated to show a true comparison. Labtest turnover increased by £5.9m and operating profit increased by £1.4m from the figures previously reported. ETL SEMKO turnover and operating profit reduced by the same amounts. The above table shows the turnover analysed by geographical origin. The turnover of continuing operations by geographical destination was Americas £168.6m (2001: £183.6m), Europe, Middle East and Africa £137.5m (2001: £127.2m) and Asia £155.0m (2001: £140.6m). In order to facilitate comparison of the underlying performance, profit on continuing operations by activity has been shown before exceptional operating items and before allocating goodwill amortisation to the divisions. After allocating these costs, the divisional profitability was: Labtest £41.5m (2001: £35.6m), Caleb Brett £17.7m (2001: £12.2m), ETL SEMKO £13.8m (2001: £10.2m), FTS £15.1m (2001: £5.3m) and central overheads £(6.2)m (2001: £(5.5)m) and geographically was: Americas £18.2m (2001: £11.1m), Europe, Middle East and Africa £15.3m (2001: £2.7m) and Asia £48.4m (2001: £44.0m). Discontinued operations relate to the Environmental Testing business. 2) NET INTEREST AND SIMILAR CHARGES 2002 2001 £m £m Interest payable: Senior Subordinated Notes 7.3 14.5 Parent Subordinated PIK Debentures 6.5 12.2 Senior Term Loans 8.0 7.7 Senior Revolver 0.5 1.3 Other 0.7 2.0 Amortisation of debt issuance costs 1.3 1.9 TOTAL 24.3 39.6 Interest receivable: On bank balances (1.8) (0.4) Net interest payable TOTAL 22.5 39.2 Exceptional finance charges Unamortised costs in connection with: Warrants converted into shares 2.2 - Repaid Senior Term Loans 6.1 - Premium on redemption of Senior Subordinated Notes 7.2 - TOTAL 15.5 - Total net interest and similar charges 38.0 39.2 3) EARNINGS PER ORDINARY SHARE The calculation of earnings per ordinary share is based on earnings after tax and minority interests and the weighted average number of ordinary shares in issue during the year. In addition to the earnings per share required by FRS 14: Earnings per share an underlying earnings per share has also been calculated and is based on earnings excluding the effect of the exceptional items and goodwill amortisation. It has been calculated to allow shareholders to gain a clearer understanding of the trading performance of the Group. Details of the underlying earnings per share are set out below: 2002 2001 Based on the profit for the period: £m £m Underlying profit before tax 54.7 30.8 Taxation on underlying profit (16.0) (16.7) Minority interest in underlying profit (4.3) (4.4) Underlying earnings TOTAL 34.4 9.7 Goodwill amortisation (0.9) (1.3) Exceptional operating items 15.6 (23.1) Exceptional finance charges (15.5) - Basic earnings TOTAL 33.6 (14.7) Number of shares (millions): Basic weighted average number of shares 123.7 80.8 Potentially dilutive share options 1.5 n/a Potentially dilutive share warrants 2.9 n/a Diluted weighted average number of shares 128.1 80.8 Basic underlying earnings/(loss) per share 27.8p 12.0p Options (0.3)p n/a Warrants (0.6)p n/a Diluted underlying earnings per share TOTAL 26.9p 12.0p Basic earnings/(loss) per share 27.2p (18.2)p Options (0.4)p n/a Warrants (0.6)p n/a Diluted earnings/(loss) per share TOTAL 26.2p (18.2)p The weighted average number of shares used in the calculation of the diluted earnings per share for the year to 31 December 2002 excludes 1,378,500 potential shares (2001: 9,303,809) as these were not dilutive in accordance with FRS 14: Earnings per share. The table below of pro-forma earnings is given in order to show the impact of the post flotation capital structure of the Group. Actual Pro-forma 2002 2002 £m £m Profit on ordinary activities before interest and exceptional items 76.0 76.0 Net interest and similar charges (22.2) (10.5) Taxation (16.0) (19.6) Attributable to minorities (4.3) (4.3) Profit for the financial year before exceptional items TOTAL 33.5 41.6 Exceptional operating items 15.6 - Exceptional finance charges (15.5) - Basic earnings TOTAL 33.6 41.6 Basic weighted average number of shares in issue (millions) 123.7 153.4 Basic earnings per share before exceptional items 27.1p 27.1p Basic earnings per share 27.2p 27.1p Pro-forma basic earnings per share represents the earnings per share based on the post flotation capital structure of the Group. This assumed that all pre-flotation debt was replaced on 31 December 2001 with the £300m new loan facility of which £250m was drawn. The pro-forma weighted average number of shares in issue was the actual number of shares in issue post flotation. 4) CREDITORS DUE WITHIN ONE YEAR Group Group 2002 2001 £m £m Borrowings: Senior Term Loans 15.5 15.4 Senior Revolver - 22.4 Other borrowings 0.4 1.0 TOTAL 15.9 38.8 Debt issuance costs (0.9) (1.7) TOTAL 15.0 37.1 Trade creditors 25.5 28.6 Corporation tax 11.0 8.5 Other taxation and social security 5.0 5.0 Other creditors 2.5 9.9 Accruals and deferred income 37.6 45.2 Dividends payable 8.0 - TOTAL 104.6 134.3 5) CREDITORS DUE AFTER ONE YEAR Group Group 2002 2001 £m £m Borrowings: Senior Term Loans 225.4 68.5 Senior Subordinated Notes - 140.0 Parent Subordinated PIK Debentures - 100.7 TOTAL 225.4 309.2 Debt issuance costs (2.9) (5.2) TOTAL 222.5 304.0 Other creditors 4.1 5.5 TOTAL 226.6 309.5 6) ANALYSIS OF NET DEBT At beginning Cash flow Debt issued in Other non-cash Exchange At end of of year lieu of changes adjustments year interest payment £m £m £m £m £m £m Cash 23.7 53.3 - - (6.4) 70.6 Borrowings (341.1) 97.1 (6.1) (5.4) 18.0 (237.5) Total net debt (317.4) 150.4 (6.1) (5.4) 11.6 (166.9) 7) RECONCILIATION OF OPERATING PROFIT TO OPERATING CASH FLOWS Group Group 2002 2001 £m £m Group operating profit after exceptional items 90.7 44.4 Depreciation charge 17.6 15.7 Goodwill amortisation 0.9 1.3 Goodwill impairment - 3.1 Impairment of fixed assets - 0.9 Loss on sale of fixed assets 0.1 0.1 Decrease/(increase) in stocks 0.3 (0.1) Increase in debtors (2.6) (6.1) (Decrease)/increase in creditors (8.9) 16.1 Decrease in other provisions (0.7) (5.4) Total operating cash inflow 97.4 70.0 Operating cash inflow before exceptional items 83.8 78.7 Exceptional cash inflow/(outflow) 13.6 (8.7) Total operating cash inflow 97.4 70.0 8) ANNUAL REPORT AND ACCOUNTS The financial information set out above does not constitute the Group's statutory accounts for the years ended 31 December 2002 or 2001. Statutory accounts for 2001 have been delivered to the Registrar of Companies and those of 2002 will be delivered following the Company's Annual General Meeting. The auditor has reported on those accounts; their reports were unqualified and did not contain statements under section 237(2) or (3) of the Companies Act 1985. The report and accounts will be posted in March 2002. The Annual General Meeting will be held on 15 May 2003. This information is provided by RNS The company news service from the London Stock Exchange
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