Interim Results

TBI PLC 25 November 2003 TBI PLC ('TBI' or 'the Group') Interim Results for the six months ended 30 September 2003 The TBI Group is one of the UK's leading airport operators. It owns and operates London Luton, Belfast International and Cardiff International Airports. The Group also owns and/or operates a number of overseas airports and airport-related businesses. SUMMARY â€¢ Turnover: Â£103.5 million (2002: Â£99.7 million) â€¢ EBITDA* : Â£32.5 million (2002: Â£33.9 million) â€¢ Operating profit: Â£14.5 million (2002: Â£23.1 million) â€¢ Profit before tax (and amortisation and exceptional items): Â£20.1m (2002: Â£22.1m) â€¢ Profit before tax: Â£7.2 million (2002: Â£15.0 million) â€¢ Earnings per share before amortisation and exceptional items: 2.13p (2002: 2.52p) â€¢ Earnings per share: 0.01p (2002: 1.34p) â€¢ Maintained interim dividend of 0.70p per share â€¢ Passenger numbers 9.95 million (2002: 8.71 million) * Operating profit before depreciation, amortisation and exceptional items Keith Brooks, Chief Executive, comments: 'Against a difficult industry backdrop we are pleased by the significant progress that TBI has made in adapting our business, so as to encourage airlines to develop further their operations with us and to attract other low cost carriers to our airports. As a consequence we continue to handle ever more passengers; which is the key driver of our business going forward.' 25 November 2003 ENQUIRIES: TBI plc Today: 020 7457 2020 Keith Brooks, Chief Executive Thereafter: 020 7408 7300 Caroline Price, Finance Director College Hill Tel: 020 7457 2020 Gareth David Justine Warren Overview These results reflect the comments made in our trading update last month, and are characterised by the continued growth in low cost traffic at each of our four core European airports, despite the adverse effects during this period of a number of external factors, including the conflict in Iraq and SARS. Looking at the mix of our business, passenger numbers through our primary airports (London Luton, Belfast International, Cardiff International and Stockholm Skavsta) have continued to reflect the transformation of TBI into a provider of terminal facilities for low cost carriers. More than 68% of our European airports' passenger numbers were accounted for by low cost traffic during this period (2002: 59%), while charter traffic fell to 25% (2002: 30%) and full service now represents only 6% of passenger numbers (2002: 10%). Principal features of this period have been significant growth in low cost traffic at Cardiff, where bmibaby has now completed its first full year of operations, and at Skavsta, where Ryanair established a base in April of this year. Within the charter market there was a significant fall-off in traffic at Luton, following the withdrawal of MyTravel, but a substantial increase at Belfast. Financials It was pleasing, against the backdrop of external factors mentioned above, to achieve a 4% increase in total revenue for the half year to Â£103.5 million (2002: Â£99.7 million), and an operating profit before depreciation, amortisation and exceptional items ('EBITDA') of Â£32.5 million (2002: Â£33.9 million), reflecting the increased proportion of low cost to charter and full service passengers. Operating profit was Â£14.5 million (2002: Â£23.1 million). Our profit before tax for the period was Â£7.2 million (2002: Â£15.0 million), reflecting principally the increased impact of exceptional items (referred to below), while earnings per share for the six month period were 0.01p (2002: 1.34p), or 2.13p (2002: 2.52p) before amortisation and exceptional items. The interim dividend is being maintained at 0.70p per share, reflecting the Board's confidence in the Group's future prospects. This will be payable on 2 January 2004 to shareholders on the register at the close of business on 5 December 2003. London Luton Passenger numbers at London Luton rose by 5% to 3.8 million during this period, but within that total there was a 15% decline in charter passengers, reflecting the withdrawal of MyTravel. By contrast, low cost traffic rose 8%, and easyJet confirmed London Luton as the focus of its future growth, announcing that it would increase the size of its London Luton-based fleet from 12 to 14 aircraft and indicating a significant future expansion of its London Luton-based operations Early evidence was the announcement on 5 November 2003 of a London Luton to Berlin Schonefeld service, commencing on 1 May 2004, which should generate in excess of 200,000 new passengers at London Luton Airport. We are currently considering the future phasing of further commercial and terminal development at London Luton, and may elect to extend some of the retail concessions, which are due to expire in April 2004, whilst decisions are finalised. As part of a UK wide initiative, tenders have been invited for a contract to take over management of car parking at the Group's UK airports, with effect from next Spring. During the period, we took the opportunity to refinance the original project finance-style facility, which was expensive and unwieldy. Exceptional costs of Â£1.8 million, relating to the early cancellation of interest rate Swaps, have been reflected in the period's results, but the annual cost benefit of the refinancing will be approximately Â£1.6 million. Belfast International A total of 2.2 million passengers used Belfast International during this period, with the airport enjoying an excellent Summer season for charter traffic, which rose by 20% compared to 2002, to 642,000 passengers. There are indications that this trend will continue through the Winter. Growth in low cost traffic using the airport also continued, with passenger numbers up by 24% to 1.6 million. The airport should benefit from a recently announced Government initiative to help airports in Northern Ireland by encouraging airlines to develop new routes. We are hopeful of being able to announce further new routes and carriers serving Belfast International in the near future. There has been an anticipated increase in our cost base at Belfast, primarily due to what will be a recurrent annual funding increase of some Â£0.5 million to the defined benefit staff pension scheme, which has been closed to new members. Cardiff International Overall traffic at Cardiff International has risen by 38% to 1.2 million passengers, compared to the same period in 2002, as the considerable success enjoyed by bmibaby in its first year of operations from the airport has more than made up for the loss of full service operations. Excluding ad hoc charters relating to specific sporting events, it is gratifying that charter passenger numbers at Cardiff International remained in line with the equivalent period in 2002. Like Belfast, Cardiff International has had an increased funding rate for its defined benefit staff pension scheme, which has been closed to new members. bmibaby's success at Cardiff International has helped us accelerate our plans to develop a new hotel and leisure complex on the business park next to the airport. We have now secured planning consent for a 150-room hotel and are in the process of selecting a partner with whom to operate the hotel. This development will also include 400 additional car parking spaces, to complement the enhanced terminal facilities at the airport. Stockholm Skavsta Overall traffic at Stockholm Skavsta rose by 250% to 592,000 passengers during this period, reflecting the establishment of Ryanair's base at the airport from the beginning of last April. To support this growth in traffic, new terminal facilities are being developed, with work progressing according to schedule, and the new facilities due to open on 1 April 2004. Some of the intra-Scandinavian routes have, for a variety of reasons, struggled to attract sufficient passengers and we are working with our airline customer to ensure that alterations to schedules and routes are as successful as possible. Whilst there is an inevitable short term impact on profitability from the costs associated with this development work, we are confident that it will allow further significant growth in passengers at this well-situated airport. In the meantime, our local management team remains committed to delivering the best possible service to all our customers and has been augmented during this challenging period by senior management from elsewhere within the Group. Other activities We have successfully contained the Group's central overhead costs and have made good progress in implementing a number of other commercial ventures. In particular, group-wide deals with our retailing and our foreign exchange bureau partners, SSP and Travelex, are proving successful. Our airport services business in North America, Airport Group International, continued to struggle in the consistently tough environment to deliver satisfactory results. In the light of the ongoing challenges facing this business, we have decided to write down the carrying value by some Â£6.2 million to approximately Â£11.0 million. In an effort to maximise all possible revenue sources from our core portfolio, tenders have also been invited for the management of car parking at our three UK airports. These contracts will begin in April 2004 and will allow us to increase our focus on our principal business, that of running airport operations. Outside our core airport portfolio, we saw some recovery in passenger numbers, particularly in domestic traffic, at Orlando Sanford and a slight increase in passenger numbers at our airports in Bolivia. Elsewhere, our hotel in Cardiff enjoyed improved profitability driven by increased occupancy and increased room rates. It also was recognised by Hilton as being their top hotel for service in the UK. SERAS The Board of TBI has been pushing hard to ensure fair recognition for the growth potential of London Luton Airport in the Government's review of airport capacity in the South East of England ('SERAS'). A full copy of our submission can be found on our website (www.tbiplc.aero). In summary, while we are not necessarily seeking new runways, we are seeking better utilisation of our existing capacity, and to have that theoretical capacity of around 31.0 million passengers per annum, compared with the current passenger throughput of around 7.0 million, formally reflected within the planning framework. Whatever the conclusions of the Government's review, it is clear that new capacity cannot be added in the South East immediately. In summary, we have a well-located asset in London Luton, which has significant capacity for traffic increases today, without the need for a further runway. We believe that London Luton can do more and we have demonstrated to Government that it can play an integral part in the overall solution to deliver airport capacity for the South East region. It is for Government to recognise that significant contribution in the forthcoming White Paper. Current trading and outlook The past six months has been a challenging period for the entire aviation industry, but against a difficult backdrop we are pleased by the significant progress that the Group has made in adapting its business by investing in the quality of terminal facilities that will attract ever more customers, encourage airlines to develop their operations with us and attract other low cost carriers to our airports. Growth of low cost airline traffic continues and we are well placed to meet the demands of that growth. Each of our airports has the runway capacity to handle additional passengers without incremental capital expenditure. In London Luton we have an airport that is currently better placed to accommodate rising passenger numbers in the South East than any competing airport, while Belfast and Cardiff have successfully adapted to the low cost model and are experiencing significant traffic growth. Together with the newly enhanced terminal facilities at Stockholm Skavsta, we have a portfolio of assets to be proud of and view our future prospects with considerable confidence. Consolidated profit and loss account For the six months ended 30 September 2003 Audited Unaudited Unaudited Year to Six months to Six months to 31 March 30 September 30 September 2003 Notes 2003 2002 Â£'000 Â£'000 Â£'000 177,618 Turnover 2.1 103,495 99,690 (24,417) Cost of sales (12,557) (12,260) 153,201 Gross profit 90,938 87,430 (129,563) Administrative expenses (76,418) (64,342) 47,268 Operating profit before depreciation, 2.2 32,537 33,898 amortisation and exceptional items (13,045) Depreciation (6,955) (6,294) (8,280) Amortisation - normal (4,224) (4,162) - - exceptional 3 (6,187) - (2,305) Exceptional items - other 2.4 (651) (354) 23,638 Operating profit 2.3 14,520 23,088 (1,000) Additional cost on disposal of property business - (1,000) (12,481) Net interest payable 4 (7,304) (7,062) 10,157 Profit on ordinary activities before tax 7,216 15,026 (3,953) Tax on profit on ordinary activities 5 (6,047) (5,796) 6,204 Profit on ordinary activities after tax 1,169 9,230 (1,606) Equity minority interests (1,133) (1,723) 4,598 Profit for the financial period 36 7,507 (12,854) Dividends 6 (3,912) (3,912) (8,256) Retained (loss)/profit for the period (3,876) 3,595 0.82p Earnings per share 7 0.01p 1.34p 0.82p Diluted earnings per share 7 0.01p 1.34p 2.86p Earnings per share before amortisation and 7 2.13p 2.52p exceptional items The turnover and operating profit shown above are derived from continuing operations. Consolidated balance sheet 30 September 2003 Audited Unaudited Unaudited 31 March 30 September 30 September 2003 Notes 2003 2002 Â£'000 Â£'000 Â£'000 Fixed assets 133,059 Goodwill 121,477 136,641 11,364 Other intangible assets 10,423 11,734 144,423 Intangible assets 131,900 148,375 217,877 Tangible assets 226,269 213,767 135,077 Investment properties 135,585 123,092 1,676 Trade investments 1,936 1,471 499,053 495,690 486,705 Current assets 1,243 Stock 1,289 1,169 28,914 Debtors 35,856 34,530 27,768 Cash at bank and in hand 8 34,684 49,038 57,925 71,829 84,737 Current liabilities (63,433) Creditors - amounts falling due within one year 9 (70,584) (69,092) (5,508) Net current assets/(liabilities) 1,245 15,645 493,545 Total assets less current liabilities 496,935 502,350 (170,387) Creditors - amounts falling due after more than one 10 (172,691) (176,117) year (4,638) Accruals and deferred income (4,581) (2,718) (17,889) Provisions for liabilities and charges (21,358) (21,015) 300,631 Net assets 298,305 302,500 Capital and reserves 55,889 Called up share capital 55,889 55,889 166,611 Share premium account 166,611 166,611 49,634 Capital reserve 15 4,591 49,634 15,959 Revaluation reserve 15,959 7,137 13,800 Profit and loss account 15 55,384 24,374 301,893 Equity shareholders' funds 14 298,434 303,645 (1,262) Equity minority interests (129) (1,145) 300,631 Capital employed 298,305 302,500 Consolidated cash flow statement For the six months ended 30 September 2003 Audited Notes Unaudited Unaudited Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 42,915 Net cash inflow from operating activities 11 32,034 23,782 Returns on investments and servicing of finance 1,155 Interest received 333 618 (11,336) Interest paid (6,804) (5,969) (390) Interest element of finance lease and hire purchase (283) (198) repayments (10,571) Net cash outflow from returns on investments and servicing of (6,754) (5,549) finance (161) Tax (272) 1,088 Capital expenditure and financial investment (12,002) Additions to tangible fixed assets (10,852) (3,267) (4,911) Additions to investment properties (1,383) (1,648) 259 Sale of tangible fixed assets 86 108 (16,654) Net cash outflow for capital expenditure and financial (12,149) (4,807) investment Acquisitions and disposals (561) Purchase of trade investments (346) (346) (378) Other acquisitions (70) - (939) Net cash outflow for acquisitions and disposals (416) (346) (12,854) Equity dividends paid - - Management of liquid resources 4,607 Cash withdrawn from/(placed on) deposit 7,018 (19,536) 92 Sale of US securities 247 5,404 4,699 Net cash inflow/(outflow) from management of liquid resources 7,265 (14,132) Financing 3,546 Bank loans drawn down 79,139 4,444 (27,767) Repayment of bank loans (83,036) (21,218) (2,572) Capital element of finance lease and hire purchase repayments (1,141) (1,267) 19,000 Proceeds from loan note - 19,000 (7,793) Net cash (outflow)/inflow from financing (5,038) 959 (1,358) Increase/(decrease) in cash in the period 12 14,670 995 Consolidated statement of total recognised gains and losses For the six months ended 30 September 2003 Audited Unaudited Unaudited Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 4,598 Profit for the financial period 36 7,507 3,379 Exchange differences on overseas investments 417 2,102 8,822 Unrealised deficit on revaluation of investment properties - - 16,799 Total gain recognised in the period 453 9,609 Notes 1. Basis of preparation The interim report and accounts have been prepared on the basis of accounting policies consistent with those set out in the Annual Report and Accounts for the year ended 31 March 2003. The interim report and accounts are unaudited but have been formally reviewed by the auditors. The information shown for the year ended 31 March 2003 does not constitute full financial statements within the meaning of Section 240 of the Companies Act 1985 and has been extracted from the full financial statements for the year ended 31 March 2003 filed with the Registrar of Companies. The report of the auditors on these accounts was unqualified and did not contain a statement under section 237(2) or section 237(3) of the Companies Act 1985. 2. Segmental information In the segmental information provided below, Airport Ownership relates to airports which are either owned or operated under long term agreements. Turnover is derived from third parties. 2.1. Turnover is analysed as follows: Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 76,531 Airport Ownership Traffic income 46,066 45,638 48,453 Commercial income 30,792 27,760 12,565 Tenant income 6,545 6,101 26,271 Airport Services 13,028 13,441 4,686 Airport Management 2,391 2,358 168,506 Total airports 98,822 95,298 9,112 Other operations 4,673 4,392 177,618 Turnover from all operations 103,495 99,690 2.2. Operating profit before depreciation, amortisation and exceptional items is analysed as follows: Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 45,821 Airport Ownership 31,669 33,453 794 Airport Services 166 274 2,861 Airport Management 1,498 1,472 49,476 Total airports 33,333 35,199 2,379 Other operations 1,272 1,051 (4,587) Head office costs (2,068) (2,352) 47,268 Operating profit before depreciation, amortisation 32,537 33,898 and exceptional items Notes (cont'd) 2. Segmental information (cont'd) 2.3 Operating profit is analysed as follows: Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 29,818 Airports 22,916 25,390 959 Other operations 626 527 (4,834) Head office costs (2,184) (2,475) - Amortisation - exceptional (6,187) - (2,305) Exceptional items - other (651) (354) 23,638 Operating profit 14,520 23,088 2.4 These exceptional items are analysed as follows: Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 (282) Litigation costs relating to discontinued operations (250) (250) and periods prior to acquisition by the Group (1,058) Reorganisation costs (401) (104) (965) Staff benefits - - (2,305) (651) (354) 3. Amortisation - exceptional During the period, the directors have reviewed the carrying value of the Group's Airport Services business given the lack of recovery in this market sector post 11 September 2001. As a result of this review and in accordance with FRS 11, the directors have written down the carrying value of the goodwill attributable to this business by US$10.0 million (Â£6.2 million). 4. Net interest payable Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 11,057 Interest payable on bank and similar loans 5,193 5,721 390 Interest on finance lease and hire purchase 283 198 arrangements 396 Bank charges 137 219 479 Amortisation of debt issue costs 247 239 (1,448) Interest receivable (361) (922) - Interest swap break cost - exceptional 1,805 - 1,607 Forgiveness of accrued interest receivable - - 1,607 exceptional 12,481 Total 7,304 7,062 4. Net interest payable (cont'd) The Group has completed a refinancing of the project finance debt at London Luton with a repayment and cancellation of the previous facility. Part of the interest rate swap attached to the previous facility has also been cancelled resulting in a termination penalty of Â£1.8 million after the release of a fair value provision of Â£2.5 million. 5. Tax The tax charge has been derived by applying the anticipated effective rate of tax for the year ending 31 March 2004 to the results for the six months to 30 September 2003. Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 2,313 Corporation tax 1,690 996 1,640 Deferred tax 4,357 4,800 3,953 Total 6,047 5,796 For the six months to 30 September 2003, the tax charge is high in relation to the profit before tax principally because no tax relief is available for the exceptional goodwill amortisation which arose in this period. Notes (cont'd) 6. Dividends Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 3,912 Interim proposed (0.70 pence) 3,912 3,912 8,942 Final paid (1.60 pence) - - 12,854 3,912 3,912 The interim dividend proposed in respect of the year ending 31 March 2004 will be payable on 2 January 2004 to shareholders on the register on 5 December 2003. The final dividend for the year ended 31 March 2003 was paid on 1 October 2003. 7. Earnings per share Earnings per share have been calculated in accordance with FRS 14, 'earnings per share', for all periods by dividing the profit for the period by the weighted average number of ordinary shares in issue during the period, based on the following information: Year to Six months to Six months to 31 March 2003 30 September 30 September 2003 2002 4,598 Profit attributable to shareholders (Â£'000) 36 7,507 15,995 Earnings before amortisation and exceptional items 11,889 14,102 (Â£'000) 559 Basic weighted average share capital (number of 559 559 shares, million) 559 Diluted weighted average share capital (number of 559 560 shares, million) The difference between the basic and the diluted weighted average share capital is wholly attributable to outstanding share options. The calculation of earnings per share before amortisation and exceptional items is based on the following analysis: Year to Six months to Six months to 31 March 2003 30 September 30 September 2003 2002 Â£'000 Â£'000 Â£'000 4,598 Profit for the financial period 36 7,507 8,280 Amortisation - normal 4,224 4,162 - - exceptional 6,187 - 2,305 Exceptional items - other 651 354 - Interest swap break cost 1,805 - 1,000 Additional cost on disposal of property business - 1,000 1,607 Forgiveness of accrued interest receivable - 1,607 (1,795) Effect of tax and equity minority interests on (1,014) (528) above adjustments 15,995 11,889 14,102 Notes (cont'd) 8. Cash at bank and in hand 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 2,676 Cash 17,195 5,040 25,092 Other bank deposits 17,489 43,998 27,768 34,684 49,038 Included within cash are amounts of: â€¢ Â£0.4 million which resides in the accounts of a UK subsidiary company and over which there are restrictions as to the transferability to other Group companies Included within other bank deposits are amounts of: â€¢ Â£3.9 million (US$6.5 million) which a US subsidiary company is required, under the terms of the US Bonds, to retain as restricted deposits to meet specified future operating costs and debt service 9. Creditors - amounts falling due within one year 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 7,272 Bank loans 1,907 7,841 680 US Industrial Development Revenue Bonds - Series 1995 711 754 574 Other loans 637 - 16,342 Trade creditors 23,349 18,204 4,742 Corporation tax 5,996 5,218 1,180 Other tax and social security 1,549 2,059 1,773 Amounts due under finance lease and hire purchase 2,327 2,062 arrangements 4,069 Other creditors 4,787 4,408 17,859 Accruals and deferred income 16,467 15,692 8,942 Dividends payable 12,854 12,854 63,433 70,584 69,092 Notes (cont'd) 10. Creditors - amounts falling due after more than one year 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 132,329 Bank loans 133,754 137,418 17,769 US Industrial Development Revenue Bonds - Series 1995 16,010 17,785 12,201 Other loans 11,754 12,786 4,282 Amounts due under finance lease and hire purchase 8,098 4,763 arrangements 3,806 Other creditors 3,075 3,365 170,387 172,691 176,117 11. Reconciliation of operating profit to net cash inflow from operating activities Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 23,638 Operating profit 14,520 23,088 13,045 Depreciation 6,955 6,294 8,280 Amortisation 10,411 4,162 (308) Release of deferred income (158) (77) (224) Increase in stock (53) (159) (5,548) Increase in debtors (7,522) (11,612) 4,032 Increase in creditors and provisions 7,881 2,086 42,915 Net cash inflow from operating activities 32,034 23,782 12. Reconciliation of net cash flow to movement in net debt Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 (1,358) Increase/(decrease) in cash in the period 14,670 995 7,793 Cash outflow/(inflow) from movement in debt, finance 5,038 (959) lease and hire purchase arrangements 6,435 Decrease in net debt resulting from cashflows 19,708 36 (4,699) Movements in other bank deposits during the period (7,265) 14,132 (945) New finance lease and hire purchase arrangements (5,513) (407) (1,000) Discount on redemption of loan note - (1,000) (477) Other non-cash items (245) (239) (2,422) Non-cash items (5,758) (1,646) 4,204 Exchange movements 1,913 5,737 3,518 Movement in net debt during the period 8,598 18,259 (152,630) Net debt at the beginning of the period (149,112) (152,630) (149,112) Net debt at the end of the period (140,514) (134,371) Notes (cont'd) 13. Analysis of net debt Cash Loan note Other bank Sub total Debt due Debt due Finance lease Total receivable deposits within one after one and hire year year purchase arrangements Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 Â£'000 At 31 March 2003 2,676 - 25,092 27,768 (8,526) (162,299) (6,055) (149,112) Cashflow 14,670 - (7,265) 7,405 (1,081) 4,978 1,141 12,443 Non-cash changes - - - - 6,261 (6,506) (5,513) (5,758) Exchange movements (151) - (338) (489) 91 2,309 2 1,913 At 30 September 2003 17,195 - 17,489 34,684 (3,255) (161,518) (10,425) (140,514) At 31March 2002 4,478 20,000 30,703 55,181 (9,074) (191,032) (7,705) (152,630) Cashflow 995 (19,000) 14,132 (3,873) 5,809 10,965 1,267 14,168 Non-cash changes - (1,000) - (1,000) (5,560) 5,321 (407) (1,646) Exchange movements (433) - (837) (1,270) 230 6,757 20 5,737 At 30 September 2002 5,040 - 43,998 49,038 (8,595) (167,989) (6,825) (134,371) At 31 March 2002 4,478 20,000 30,703 55,181 (9,074) (191,032) (7,705) (152,630) Cashflow (1,358) (19,000) (4,699) (25,057) 10,689 13,532 2,572 1,736 Non-cash changes - (1,000) - (1,000) (10,264) 9,787 (945) (2,422) Exchange movements (444) - (912) (1,356) 123 5,414 23 4,204 At 31 March 2003 2,676 - 25,092 27,768 (8,526) (162,299) (6,055) (149,112) Notes (cont'd) 14. Reconciliation of movement in equity shareholders' funds Year to Six months to Six months to 31 March 2003 30 September 30 September Â£'000 2003 2002 Â£'000 Â£'000 4,598 Profit attributable to shareholders 36 7,507 (12,854) Dividends (3,912) (3,912) (8,256)Retained (loss)/profit for the period (3,876) 3,595 8,822 Surplus on revaluation of investment properties - - 3,379 Exchange differences on overseas investments 417 2,102 3,945 Net (reduction in)/addition to equity shareholders' (3,459) 5,697 funds 297,948 Opening equity shareholders' funds 301,893 297,948 301,893 Closing equity shareholders' funds 298,434 303,645 15. Capital reserve and profit and loss account During the period, the directors have reviewed the Group's capital reserve and have transferred some Â£45.0 million of distributable reserves from the capital reserve to the profit and loss account. This transfer is due to certain historic merger reserves becoming distributable as a result of the disposal of the Group's property business in 1999. 16. Contingent liabilities The Group had the following contingent liabilities as at 30 September 2003: â€¢ The Group guaranteed the performance of a company in Costa Rica, in which the Group own 10% of the issued share capital, under the terms of certain bank loan arrangements amounting to Â£0.7million (US$1.1 million) â€¢ The Group guaranteed the performance of a company in Costa Rica, in which the Group owns 10% of the issued share capital, under the terms of certain obligations amounting to Â£0.8 million (US$1.4 million) The Group is dealing with a small number of legal claims, the aggregate value of which has been estimated at some Â£10.0 million. The directors have reviewed all of these claims and, on the basis of legal advice received, believe that exposure to future losses is unlikely. Additional financial information Year to Six months to Six months to 31 March 30 September 30 September 2003 2003 2002 Â£'000 Â£'000 Â£'000 Operating profit before depreciation, amortisation and exceptional items 21,305 London Luton 13,568 14,494 10,015 Belfast International 7,610 7,211 10,896 Cardiff International 7,714 8,083 778 Orlando Sanford 1,880 1,548 (376) Stockholm Skavsta (656) 166 3,203 Bolivia 1,553 1,951 794 Airport Services 166 274 1,174 Airport Management - North America 489 636 1,364 856 670 323 153 166 - London Luton - Costa Rica 49,476 Total - airports division 33,333 35,199 2,379 Other operations 1,272 1,051 (4,587) Head office (2,068) (2,352) 47,268 Operating profit before depreciation, 32,537 33,898 amortisation and exceptional items (13,045) Depreciation (6,955) (6,294) (8,280) Amortisation - normal (4,224) (4,162) - - exceptional (6,187) - (2,305) Exceptional items - other (651) (354) 23,638 Operating profit 14,520 23,088 (1,000) Additional cost on disposal of property - (1,000) business (10,874) Net interest payable - normal (5,499) (5,455) (1,607) - exceptional (1,805) (1,607) 10,157 Profit on ordinary activities before tax 7,216 15,026 (3,953) Tax on profit on ordinary activities (6,047) (5,796) 6,204 Profit on ordinary activities after tax 1,169 9,230 (1,606) Equity minority interests (1,133) (1,723) 4,598 Profit for the financial period 36 7,507 15,995 Profit attributable to shareholders before 11,889 14,102 amortisation and exceptional items (Note 7) 2.86p Earnings per share attributable to shareholders 2.13p 2.52p before amortisation and exceptional items Corporate operational information Airport ownership with a controlling interest Six months Six months Six months Six months Six months Six months 30 Sept 30 Sept 30 Sept 2003 30 Sept 30 Sept 2003 30 Sept 2003 2002 2002 2002 London Luton Belfast International Cardiff International Airport Airport Airport Total passengers ('000) Charter 648 765 642 537 687 702 Full service 400 309 3 228 102 144 Low cost 2,763 2,565 1,575 1,272 425 39 Transit 13 10 18 21 13 4 Total 3,824 3,649 2,238 2,058 1,227 889 Terminal Passengers Spend per head Â£3.81 Â£3.93 Â£2.35 Â£2.25 Â£3.21 Â£3.01 Net passenger supplement per Â£3.20 Â£3.22 Â£2.63 Â£2.89 Â£4.27 Â£6.17 head Total Â£7.01 Â£7.15 Â£4.98 Â£5.14 Â£7.48 Â£9.18 Charter Number of tour operators 26 24 21 19 37 36 Number of seats offered 750 875 708 604 749 756 ('000) New charter destinations 1 1 1 1 1 3 Full service Number of major airlines 5 5 1 2 2 4 Number of seats offered 511 420 7 309 220 260 ('000) Low cost Number of major airlines 3 2 3 2 2 1 Number of seats offered 3,448 3,180 2,044 1,694 603 50 ('000) Freight tonnage 11,914 11,022 21,826 22,634 1,774 1,170 Some of the services from London Luton Airport Amsterdam, Barcelona, Belfast, Dublin, Edinburgh, Geneva, Glasgow, Malaga, Nice and Paris. Some of the services from Belfast International Airport Amsterdam, Birmingham, Bristol, Cardiff, East Midlands, Edinburgh, Liverpool, London Gatwick, London Luton and London Stansted. Some of the services from Cardiff International Airport Alicante, Amsterdam, Belfast, Dublin, Edinburgh, Geneva, Milan, Palma, Paris and Toulouse. Airport ownership with a controlling interest, shown above, relates to airports which are either owned or operated under long term agreements. Corporate operational information Airport ownership with a controlling interest (continued) Six months Six months Six months Six months Six months Six months 30 Sept 30 Sept 30 Sept 2003 30 Sept 30 Sept 2003 30 Sept 2003 2002 2002 2002 Orlando Sanford Stockholm Skavsta Airport Bolivian Airports Total passengers ('000) Charter 595 662 - - - - Full service - - - 10 1,046 973 Low cost 215 116 589 155 - - Transit 2 48 3 4 210 150 Total 812 826 592 169 1,256 1,123 Terminal Passengers Spend per head Â£3.62 Â£3.45 Â£1.80 Â£1.88 Â£1.17 Â£1.36 Net passenger supplement per Â£1.19 Â£1.06 Â£1.17 Â£1.09 Â£2.21 Â£2.40 head Total Â£4.81 Â£4.51 Â£2.97 Â£2.97 Â£3.38 Â£3.76 Charter Number of tour operators 20 25 - - - - Number of seats offered 670 828 - - - - ('000) New charter destinations 1 10 - - - - Full service Number of major airlines - - - 2 9 9 Number of seats offered - - - 44 1,745 1,794 ('000) Low cost Number of major airlines 3 1 2 2 - - Number of seats offered 330 242 882 205 - - ('000) Freight tonnage 4,202 4,205 4,268 7,033 2,338 2,710 Some of the services from Orlando Sanford Allentown, Birmingham, Glasgow, London Gatwick, Manchester, Newburgh, Newcastle, Portsmouth, San Juan and Syracuse. Some of the services from Stockholm Skavsta Airport Aarhus, Brussels, Frankfurt, Glasgow, Hamburg, London Stansted, Oslo, Paris, Tampere and Visby. Some of the services from the Bolivian Airports Asuncion, Bogota, Caracas, Ezeisa, Guarullos, Lima, Mexico, Miami, Padahuel and Paris. Airport ownership with a controlling interest, shown above, relates to airports which are either owned or operated under long term agreements. This information is provided by RNS The company news service from the London Stock Exchange

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