Interim Results - Part 2

Kingfisher PLC
12 September 2001

PART 2

                                KINGFISHER PLC
             NOTES TO THE INTERIM FINANCIAL STATEMENTS (UNAUDITED)


1.                  Turnover


                               Half year ended Half year ended       Year ended
£ millions                       4 August 2001    29 July 2000  3 February 2001

Home Improvement                       2,985.0         2,591.3          5,093.5

UK                                     1,672.0         1,420.4          2,766.9
France                                   930.6           868.7          1,707.5
Other                                    382.4           302.2            619.1

Electrical and Furniture               1,622.9         1,502.8          3,564.9

UK                                       518.5           455.4          1,135.1
France                                   731.8           684.3          1,605.4
Germany                                  285.0           265.0            605.7
Other                                     87.6            98.1            218.7

Property                                  11.6             8.8             48.8
Financial Services                        26.3            31.6             58.2

Total continuing operations            4,645.8         4,134.5          8,765.4

Discontinued operations                1,394.4         1,324.4          3,368.8

Total                                  6,040.2         5,458.9         12,134.2




2.          Exceptional items


Demerger costs of £41.0m have been charged to the profit and loss account as
follows:


                                                              £m             £m
Operating cost  - continuing                               (4.2)              -
- discontinued                                             (9.6)
                                                                         (13.8)
Non-operating - discontinued                                   -         (27.2)
                                                                         (41.0)


  The operating exceptional item also includes £93.7m in relation to an
  impairment charge against the remaining goodwill in respect of the ProMarkt
  business, which has been charged to continuing operations.




  The loss on the sale of operations item of £342.5m represents the loss on the
  sale of the Superdrug business, which incorporates a non-cash accounting
  adjustment of £287.5m in respect of goodwill previously written off to
  reserves.



  The loss on the disposal of fixed assets item represents the following:


                                                                     £m      £m
Continuing operations:

- Provisions for loss on the disposal of Virtueller Bau-Markt     (4.8)
AG

- Provision for loss on the disposal of Recommend Limited         (3.0)

- Provision against the carrying value of investment in Dekor    (23.2)
Inc

- Losses on the disposal of properties                            (0.3)

                                                                         (31.3)

 Discontinued operations:

- Provision for loss on the disposal of Think Natural Limited     (4.5)

- Provision for loss on the disposal of Tiscali SpA              (13.0)
                                                                         (17.5)
Total                                                                    (48.8)


  The losses and profits on the disposal of fixed asset items in the half year
  ended 29 July 2000 and the year ended 3 February 2001 relate to property
  disposals in continuing businesses.


  For the year ended 3 February 2001 the operating exceptional income of £5.8m
  represents a non-recurring reduction in local French business tax on the
  restructuring of Group companies.



  For the year ended 3 February 2001 the loss on the sale of operations item of
  £14.7m included £13.3m in respect of the loss on the disposal of the Electric
  City business, (charged to continuing operations) and £1.4m in respect of the
  loss on the sale of the Andre Deutsch business (charged to discontinued
  operations).






3. Dividends



   An interim dividend of 4.345p amounting to £53.4m (2000: 4.25p, £58.4m) will
   be paid on 16 November 2001 to shareholders on the Register at 28 September
   2001.  A scrip dividend will be offered and forms of election will be sent
   to shareholders on 9 October 2001.


4. Earnings/(loss) per share



   The earnings per share calculations set out below are stated before taking
   account of the 10 for 11 share consolidation.



   Continuing Operations



   The calculation of basic earnings per share for continuing operations is
   based on the loss on ordinary activities, after taxation and minority
   interests, of £(39.4)m (2000: profit of £102.7m) and the weighted average
   number of shares in issue during the period of 1,378.7m (2000: 1,363.1m).
   The diluted earnings per share for continuing operations is based on the
   diluted loss on ordinary activities, after taxation and minority interests,
   of £(41.9)m (2000: profit of £102.0m) and the diluted weighted average
   number of shares in issue during the period of 1,385.6m (2000: 1,381.7m).



   The difference between the basic and diluted earnings per share and the
   basic adjusted and diluted adjusted earnings per share is reconciled as
   follows:




                                                                  As         As
                                                            restated   restated
                                        Half year Half year ended 29
                                            ended          July 2000 Year ended
Per share amount pence                   4 August                    3 February
                                             2001                          2001
Basic (loss)/earnings per share             (2.9)                7.5       18.0

Earnings per share relating to                9.2                0.1        0.8
exceptional items
Earnings per share relating to
acquisition goodwill amortisation             0.6                0.5        1.1
                                              
Basic adjusted earnings per share             6.9                8.1       19.9


Diluted (loss)/earnings per share           (3.0)                7.4       17.4


Earnings per share relating to                9.0                  -        0.7
exceptional items
Earnings per share relating to
acquisition goodwill amortisation             0.6                0.5        1.1
                                              
Diluted adjusted earnings per share           6.6                7.9       19.2





Total Group

The calculation of basic earnings per share for the total Group is based on the
loss on ordinary activities, after taxation and minority interests, of £(453.8)
m (2000: profit of £210.5m) and the weighted average number of shares in issue
during the period of 1,378.7m (2000: 1,363.1m).  The diluted earnings per share
is based on the diluted loss on ordinary activities, after taxation and
minority interests, of £(456.3)m (2000: profit of £209.8m) and the diluted
weighted average number of shares in issue during the period of  1,385.6m
(2000: 1,381.7m).

The difference between the basic and diluted earnings per share and the basic
adjusted and diluted adjusted earnings per share is reconciled as follows:




                                                                  As         As
                                                            restated   restated
Per share amount pence                          Half year  Half year Year ended
                                                    ended      ended
                                                 4 August    29 July 3 February
                                                     2001       2000       2001
                                                                
Basic (loss)/earnings per share                    (32.9)       15.4       29.9

Earnings per share relating to exceptional           37.3      (8.8)      (7.3)
items
Earnings per share relating to acquisition
goodwill amortisation                                 0.8        0.6        1.3
                                                      
Earnings per share relating to estimated
Liberty Surf Group S.A. losses                          -        1.1        3.1
                                                        
Basic adjusted earnings per share                     5.2        8.3       27.0


Diluted (loss)/earnings per share                  (32.9)       15.2       29.2



Earnings per share relating to exceptional           37.1      (8.6)      (7.2)
items
Earnings per share relating to acquisition
goodwill amortisation                                 0.8        0.6        1.3
                                                      
Earnings per share relating to estimated
Liberty Surf Group S.A. losses                          -        1.0        3.0
                                                        
Diluted adjusted earnings per share                   5.0        8.2       26.3







5.   Reconciliation of cashflow from operating activities




                                            Half year    Half year   Year ended
                                                ended        ended   3 February
£ millions                                   4 August 29 July 2000        2001  
                                                 2001
Group operating profit                          100.7        236.0        704.5
Impairment charge                                93.7            -            -
Depreciation and amortisation                   138.0        107.0        233.7
                                                332.4        343.0        938.2
(Increase)/decrease in development work
in progress                                    (14.9)       (25.6)          7.5

Increase in stocks                             (13.8)      (255.8)      (377.3)
Decrease/(increase) in debtors                  161.1       (67.7)      (143.6)
(Decrease)/increase in creditors               (78.8)        315.6        127.8
Loss on disposal of fixed assets                  3.2          3.1         10.6
Net cash inflow from operating                  389.2        312.6        563.2
activities








6.     Reconciliation of net borrowings




                                        Half year      Half year     Year ended
                                            ended          ended     3 February
£ millions                          4 August 2001   29 July 2000           2001 
                               
                                    

Net debt at start of period             (1,873.8)      (1,020.8)      (1,020.8)
Decrease in cash                           (13.7)          (4.7)         (18.9)
Debt in subsidiaries acquired                   -              -          (0.8)
Net movement in short-term                      -            5.5          (4.2)
deposits
Net movement in investments                  23.1        (169.3)        (183.7)
Change in market value in                       -            1.1              -
investments
Net movement in loans                       114.4         (80.3)        (630.5)
Foreign exchange effects                     16.7          (4.4)         (14.9)
Net debt at end of period               (1,733.3)      (1,272.9)      (1,873.8)






7. Accounting policies



   Accounting policies have been consistently applied on the basis set out in
   the Group's financial statements for the year ended 3 February 2001, except
   in respect of the changes discussed below caused by the introduction of
   Financial Reporting Standard 19 'Deferred Tax' ('FRS 19').


   Financial Reporting Standard 19 'Deferred Tax' has been adopted for the
   first time in these financial statements. As required by the Standard,
   deferred taxation has been calculated using the full provision approach
   rather than the partial provision approach previously employed. This change
   has been accounted for as a prior year adjustment and previously reported
   figures have been restated accordingly.  If the previous policy had been
   adopted in the current half year, the impact would have been to increase
   profit after tax by £1.5m.  The impact of adopting the new policy on the
   half year to 29 July 2000 has been to reduce profit after tax by £2.6m. The
   impact of adopting the new policy on the year ended 3 February 2001 has been
   to reduce profit after tax by £6.5m. The cumulative effect of this charge on
   reserves at 3 February 2001 is £46.4m and this change has been accounted for
   as a prior period adjustment.


  Financial Reporting Standard 18 'Accounting Policies' has also been adopted
  for these financial statements.  The Directors have reviewed the accounting
  policies adopted by the Group and have confirmed that they are the most
  appropriate to the particular circumstances of Kingfisher plc.  There is no
  change to previously reported numbers as a result of the adoption of this
  standard.



8. Post balance sheet events



   On 13 August 2001 the Group announced the sale of 182 high street
   properties.  The properties have been sold for £614m to a partnership
   between London and Regional Properties and Goldman Sachs' Whitehall Fund.



   On 24 August 2001 at an extraordinary meeting of Kingfisher shareholders the
   demerger of the Group's General Merchandise business to Woolworths Group plc
   was approved.  Shares in Woolworths Group plc were admitted to the official
   list and commenced trading on the London Stock Exchange on 28 August 2001.


9. Full year comparatives



   The results for the year to 3 February 2001 are based on full audited
   accounts which were filed with the Registrar of Companies and on which the
   auditors made a report under section 235 of the Companies Act 1985 which
   does not contain a statement under sections 237 (2) or (3) of the Companies
   Act 1985 and is unqualified.


10. Shareholder information



    Copies of the results will be sent to shareholders during the week
    commencing 24 September 2001 and additional copies will be available from
    Kingfisher plc, North West House, 119 Marylebone Road, London NW1 5PX.

Independent review report to Kingfisher plc


We have been instructed by the Company to review the financial information set
out on pages 17 to 22 and the notes thereto, and we have read the other
information contained in the interim report for any apparent misstatements or
material inconsistencies with the financial information.


Directors' responsibilities


The interim report, including the financial information contained therein, is
the responsibility of, and has been approved by the Directors.  The Listing
Rules of the Financial Services Authority require that the accounting policies
and presentation applied to the interim figures should be consistent with those
applied in preparing the preceding annual accounts except where any changes,
and the reasons for them, are disclosed.

Review work performed

We conducted our review in accordance with guidance contained in Bulletin 1999/
4 issued by the Auditing Practices Board. A review consists principally of
making enquiries of Group management and applying analytical procedures to the
financial information and underlying financial data, and based thereon,
assessing whether the accounting policies and presentation have been
consistently applied unless otherwise disclosed. A review excludes audit
procedures such as tests of controls and verification of assets, liabilities
and transactions. It is substantially less in scope than an audit performed in
accordance with Auditing Standards and therefore provides a lower level of
assurance than an audit.  Accordingly we do not express an audit opinion on the
financial information.


Review conclusion
On the basis of our review we are not aware of any material modifications that
should be made to the financial information as presented for the six months
ended 4 August 2001.


PricewaterhouseCoopers
Chartered Accountants
London
12 September 2001