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Brewin Dolphin Hldgs (BRW)

  Print          Annual reports

Friday 30 May, 2008

Brewin Dolphin Hldgs

Interim Results

RNS Number : 5660V
Brewin Dolphin Holdings PLC
30 May 2008
 



30 May 2008


Brewin Dolphin Holdings PLC


Interim Financial Report


For the Half Year Ending 30 March 2008


Highlights


  • Discretionary funds £10.4 billion at 30 March 2008 (30 September 2007: £10.7 billion, 31 March 2007: £10.1 billion)


  • Total income £104.1 million (2007: £98.0 million) an increase of 6.2%


  • Profit before tax £21.8 million (2007: £20.8 million) a 4.9% increase


  • Earnings per share


 - Basic earnings per share 7.5p (20077.2p) an increase of 4.2%


 - Diluted earnings per share 7.2p (2007: 6.8p) an increase of 5.9%


Declaration of Interim Dividend

The Board is pleased to declare an interim dividend of 3.55p per share, this being up 5.2% against 3.375per share interim dividend paid in October 2007. The interim dividend is payable on 24 September 2008 to shareholders on the register as at 22 August 2008, with an ex dividend date of 20 August 2008.


Jamie Matheson, Executive Chairman said

'Within the Investment Management division there is strong performance from our discretionary fund management activities and our Investment Banking arm has achieved operating profitsDespite difficult conditions we expect a creditable outcome from your Group for the year.'


For further information

Jamie Matheson, Executive Chairman            Toby Mountford / George Cazenove

Brewin Dolphin                                                   Citigate Dewe Rogerson

020 7248 4400                                                   020 7638 9571

  Executive Chairman's Statement 


To the members of Brewin Dolphin Holdings PLC


Introduction


This statement forms the Interim Management Report for the half year ending 30 March 2008


Results and review of the past six months


It gives me pleasure to report on the Interim Results for the six months ended 30 March 2008. Your Group achieved pre-tax profits of £21.8 million (2007: £20.8 million), an increase of 4.9over the comparable period last year, with total income up 6.2% at £104.1 million (2007: £98.0 million).


Within these figures there is strong performance from our discretionary fund management activities where operating profit rose by 22.8% to £11.0 million (2007: £9.0 million) and total income by 17.8% to £60.5 million (2007: £51.4 million). The operating profit from our advisory business was virtually unchanged at £6.6 million with total income up by 2.1% at £36.0 million (2007: £35.3 million).  


Our Investment Banking arm has experienced quieter trading in very tough market conditions. The Division has achieved operating profits of £1.1 million (2007: £2.5 million) and total income of £7.6 million (2007: £11.4 million).


Fully diluted earnings per share grew by 5.9% from 6.8p to 7.2p. Your Board is pleased to announce that the Company will pay an interim dividend of 3.55p per share, payable on 24 September 2008


During the period under review total funds declined by 8.4% to £23.0 billion (September 2007: £25.1 billion). Our discretionary funds under management have fallen by 2.8% but, when compared to the FTSE APCIMS Balanced Index, show a rise of 4.9% in real terms (9.8% annualised). 




 At

 30 March
 2008 

 At 

30 September 2007 


 % Change 

Indices




FTSE APCIMS Private Investor Series Balanced Portfolio

2,796

3,029

-7.7%

FTSE 100

5,693

6,467

-12.0%

­




Funds





£ Billion

£ Billion


Discretionary funds under management

10.4

10.7

-2.8%

Advisory funds under management

9.5

10.9

-12.8%

Execution only stock

3.1

3.5

-11.4%

Total funds

23.0

25.1

-8.4%


These results have been achieved against a market background more challenging than at any time since the early 1970's.  Your Group has continued to pursue a strategy of growth by adding new teams and offices as well as by organic growth from our existing offices.  We have welcomed 29 new fund managers during the period and opened a new office in Nottingham in April 2008.

 

Related party transactions


Related party transactions are disclosed in note 3 to the Interim Financial Report. 


Outlook


As always our principal risk in the short term is the threat of adverse market movement. Clearly, the next few months will continue to be affected by unsettled financial markets across the globe.  


Despite difficult conditions we expect a reasonably stable outcome from our Investment Management business for the second half. It is unlikely that there will be any material IPO activity from our Investment Banking division.


Your Board remains firmly committed to the strategy of increasing value to shareholders through the pursuit of judicious growth and we continue to be confident in our long term prospects.




Jamie Matheson

29 May 2008


Consolidated Income Statement

26 week period ended 30 March 2008




Unaudited 

26 weeks to 

30 March 2008

Unaudited 

26 weeks to 

31 March 2007

Audited 

52 weeks to 

30 September 2007


Note

£'000s

£'000s

£'000s

Continuing operations





Revenue


95,130 

92,838 

198,032 

Other operating income


8,967 

5,186 

11,247 

Total income

104,097 

98,024 

209,279 






Staff costs


(52,038)

(51,953)

(117,641)

Other operating costs


(33,349)

(28,086)

(56,882)



(85,387)

(80,039)

(174,523)






Operating profit


18,710 

17,985 

34,756 

Other gains and losses


- 

58 

58 

Finance income

3,518 

2,786 

7,406 

Finance costs

(428)

(53)

(564)

Profit before tax

5

21,800 

20,776 

41,656 

Tax

(6,447)

(6,452)

(12,708)

Profit attributable to equity shareholders of the parent from continuing operations


15,353 


14,324 


28,948 






Earnings per share










From continuing operations 





  Basic

7.5p

7.2p

14.5p






  Diluted

7.2p

6.8p

13.8p






 

Consolidated Statement of Recognised Income and Expense

 

26 week period ended 30 March 2008



Unaudited 26 weeks to 30 March 2008

Unaudited 26 weeks to 31 March 2007

Audited 

52 weeks to 30 September 2007



£'000s

£'000s

£'000s





(Loss)/gain on revaluation of available-for-sale investments

(600)

299 

816 

Tax on revaluation of available-for-sale investments

168 

(90)

(41)

Actuarial (loss) /gain on defined benefit pension scheme

(1,570)

1,133 

1,420 

Tax on actuarial loss/(gain) on defined benefit pension scheme

440 

(340)

(620)

Deferred tax on share based payments


(1,125)

388 

439 

Net (expense)/income recognised directly in equity

(2,687)

1,390 

2,014 






Transfers





Transfer gain on revaluation on sale of available-for-sale investments

- 

(54)

(54)

Transfer tax on revaluation on sale of available-for-sale investments

- 

18 

18 

Transfer to profit or loss on sale of available-for-sale investments

- 

(36)

(36)



(2,687)

1,354 

1,978 






Profit for the period


15,353 

14,324 

28,948 

Total recognised income and expense for the period attributable to equity shareholders of the parent


12,666 


15,678 


30,926 







Consolidated Balance Sheet

As at 30 March 2008



Unaudited as at 30 March 2008

Unaudited as at 31 March 2007

Audited as at  30 September 2007



£'000s

£'000s

£'000s


Note




ASSETS





Non-current assets





Goodwill

10

75,040

73,037

65,767

Property, plant and equipment

11

24,166

19,231

20,949

Available-for-sale investments

12

10,926

11,009

11,526

Other receivables


2,270

1,896

2,059

Deferred tax asset


-

1,531

542



112,402

106,704

100,843

Current assets





Trading investments

12

1,307

1,337

1,251

Trade and other receivables


290,948

356,435

356,385

Cash and cash equivalents


52,915

54,274

87,946



345,170

412,046

445,582

Total assets


457,572

518,750

546,425






LIABILITIES





Current liabilities





Bank overdrafts


999

1,618

543

Trade and other payables


304,212

370,418

404,873

Current tax liabilities


3,491

5,549

4,965

Shares to be issued including premium

13

7,674

1,000

4,504



316,376

378,585

414,885

Net current assets


28,794

33,461

30,697






Non-current liabilities





Retirement benefit obligation

14

5,781

13,993

9,735

Deferred purchase consideration

13

966

3,529

664

Deferred tax liability


2,551

-

-

Shares to be issued including premium 

13

8,413

18,080

5,809



17,711

35,602

16,208

Total liabilities


334,087

414,187

431,093

Net assets


123,485

104,563

115,332






EQUITY





Called up share capital

16

2,073

2,015

2,035

Share premium account

16

89,352

84,885

86,968

Revaluation reserve

16

7,112

6,978

7,544

Merger reserve

16

4,562

4,562

4,562

Profit and loss account

16

20,386

6,123

14,223

Equity attributable to equity holders of the parent

16

123,485

104,563

115,332

Consolidated Cash Flow Statement

26 week period ended 30 March 2008




Unaudited
 26 weeks to 30 March
 2008

Unaudited
 26 weeks to 31 March
 2007

Audited
 52 weeks to 30 September 2007


 Note 

£'000s

£'000s

£'000s

 Net cash flow from operating activities 

15 

(21,107)

7,389 

54,183 






 Cash flows from investing activities 





 Purchase of goodwill 

10 

(2,737)

(3,532)

(6,114)

 Deferred purchase consideration 


(140)

- 

- 

 Purchases of property, plant and equipment 

11

(7,056)

(5,007)

(10,106)

 Proceeds from sale of available-for-sale investments 


- 

159 

159 

 Purchases of available-for-sale investments 


- 

(400)

(400)

 Dividend received from available-for-sale investments 


- 

- 

322 

 Net cash used in investing activities 


(9,933)

(8,780)

(16,139)






 Cash flows from financing activities 





 Dividends paid to equity shareholders 


(6,869)

(5,488)

(11,279)

 Proceeds on issue of shares 


2,422 

1,156 

2,259 

 Net cash used in financing activities 


(4,447)

(4,332)

(9,020)






 Net (decrease) / increase in cash and cash equivalents  

(35,487)

(5,723)

29,024 






 Cash and cash equivalents at the start of period 


87,403 

58,379 

58,379 

 Cash and cash equivalents at the end of period 


51,916 

52,656 

87,403 











Firm's cash 


32,046 

37,369 

68,960 

Firm's overdraft


(999)

(1,618)

(543)

Firm's net cash


31,047 

35,751 

68,417 

Client settlement cash


20,869 

16,905 

18,986 

Net cash and cash equivalents


51,916 

52,656 

87,403 






Cash and cash equivalents shown in current assets


52,915 

54,274 

87,946 

Bank overdrafts


(999)

(1,618)

(543)

Net cash and cash equivalents


51,916 

52,656 

87,403 











 

 Notes to the Interim Financial Report


   1.  Basis of preparation

The annual financial statements of Brewin Dolphin Holdings PLC are prepared in accordance with International Financial Reporting Standards as adopted by the European Union. The condensed set of financial statements included in this interim financial report for the 26 week period to 30 March 2008 has been prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting', as adopted by the European Union. The same accounting policies, presentation and methods of computation are followed in the condensed set of financial statement as applied in the Group's latest audited Annual Report and Accounts for the year ended 30 September 2007.


   2.  Section 240 statement

The financial information set out in this document in respect of the year ended 30 September 2007 does not constitute the Group's statutory accounts for the year ended 30 September 2007 within the meaning of section 240 of the Companies Act 1985. Those accounts were prepared under International Financial Reporting Standards and have been reported on by the Company's auditors and delivered to the Registrar of Companies. The auditors report was unqualified and did not contain a statement under section 237 (2) or (3) of the Companies Act 1985. A copy of this statement is available at the Company's registered office at 12 Smithfield StreetLondon EC1A 9BD and a copy will be posted to all shareholders. 


   3.  Related party transactions

Related party transactions are described in the 2007 Annual Report and Accounts on page 65. The parent company has received dividends of £16,600 (March 2007: £nil; September 2007: £nil), from Webrich Limited, a subsidiary company, in the period. There were no other related party transactions during the 26 week period to 30 March 2008The amount owed by Brewin Dolphin Limited to the parent company is £6,889,000 (March 2007: £2,508,000; September 2007: £11,321,000). There have been no changes in the related party transactions described in the 2007 Annual Report and Accounts on www.brewin.co.uk with the exception of the amount owed by Brewin Dolphin Limited as described above.


   4.  Principal risks and uncertainties

Information on the principal long-term risks and uncertainties of the Group is included in our latest Annual Report and Accounts on www.brewin.co.uk. Risks and uncertainties which could have a material impact on the Group's performance over the remaining six months of the financial year are discussed in the Executive Chairman's Statement.

    5.  Segmental information

For management purposes, the Group is divided into two business streams: Investment Management and Investment Banking. These form the basis for the primary segment information reported below. All operations are carried out in the United Kingdom and the Channel Islands.

    


Unaudited
 26 weeks to 30 March 2008

Unaudited
 26 weeks to 31 March 2007

Audited
 52 weeks to
30 September 2007


£'000s

£'000s

£'000s

Total income




Investment management




  Discretionary portfolio management

60,530

51,382

110,413

  Advisory portfolio management

36,015

35,263

69,326


96,545

86,645

179,739

Investment banking

7,552

11,379

29,540


104,097

98,024

209,279

Profit before tax




Investment management




  Discretionary portfolio management

11,047

8,996

15,154

  Advisory portfolio management

6,573

6,458

12,555


17,620

15,454

27,709

Investment banking

1,090

2,531

7,047


18,710

17,985

34,756

Other gains and losses and finance income (net)

3,090

2,791

6,900


21,800

20,776

41,656

Segment assets




Investment management

413,245

432,593

398,112

Investment banking

44,327

86,157

148,313


457,572

518,750

546,425

Segment liabilities




Investment management

289,760

328,030

282,780

Investment banking

44,327

86,157

148,313


334,087

414,187

431,093







  6.  Finance income and costs

 


Unaudited 26 weeks to  30 March 2008

Unaudited 26 weeks to  31 March 2007

Audited 52 weeks to  30 September 2007


£'000s

£'000s

£'000s

Finance income




Interest income on pension plan assets

66

-

60

Dividends from equity investments

-

-

322

Interest on bank deposits

3,452

2,786

7,024


3,518

2,786

7,406





Finance costs




Interest cost on pension plan liabilities

-

40

-

Finance cost of deferred consideration

412

-

515

Interest on bank overdrafts

16

13

49


428

53

564






   7.  Taxation

    


Unaudited 26 weeks to  30 March 2008

Unaudited 26 weeks to  31 March 2007

Audited 52 weeks to  30 September 2007


£'000s

£'000s

£'000s

United Kingdom




Current year

3,758

5,504

10,247

Prior year 

-

-

430

Overseas




Current

111

195

297

Prior year 

-

-

5


3,869

5,699

10,979

United Kingdom deferred tax




Current year

2,388

793

2,207

Prior year 

72

-

(398)

Impact of change in tax rate 

118

(40)

(80)


6,447

6,452

12,708





 

  8.  Earnings per share

    

    The calculation of the basic and diluted earnings per share is based on the following data:

    


Unaudited
 26 weeks to 30 March 2008

Unaudited 26 weeks to  31 March 2007

Audited 52 weeks to  30 September 2007

Number of shares





'000 

'000 

'000 

Basic




Weighted average number of shares in issue in the period

204,770 

200,138 

201,438 

Diluted




Weighted average number of options outstanding for the period

3,477 

5,623 

5,135 

Estimated weighted average number of shares to be issued under deferred consideration arrangements

6,862 

4,719 

4,712 





Diluted weighted average number of options and shares for the period

215,109 

210,480 

211,285 





Earnings attributable to ordinary shareholders





£'000s

£'000s

£'000s





Profit attributable to equity shareholders of the parent from continuing operations

15,353 

14,324 

28,948 

Finance costs of deferred consideration (Note a)

254 

- 

311 

 less tax 

(74)

- 

(93)

Adjusted basic profit for the period and attributable earnings

15,533 

14,324 

29,166 





Earnings per share








From continuing operations




  Basic

7.5p

7.2p

14.5p





  Diluted

7.2p

6.8p

13.8p









a) Finance costs of deferred consideration are added back where the issue of shares is more dilutive than the interest cost saved.


   9.  Dividends

    






Unaudited
 26 weeks to
30 March 2008

Unaudited
 26 weeks to 31 March 2007

Audited
 52 weeks to 30 September 2007


£'000s

£'000s

£'000s

Amounts recognised as distributions to equity holders in the period: 




Final dividend paid 7 April 2008, 3.5p per share

7,248

-

-

First interim dividend paid 10 April 2007, 2.875p per share

-

5,791

5,791

Second interim dividend paid 25 October 2007, 3.375p per share

-

-

6,869


7,248

5,791

12,660





 

  10.  Goodwill 

    








£'000 

At 1 October 2007



65,767 

Revaluations



1,989 

Additions



7,284 

At 30 March 2008



75,040 





There are no accumulated impairment losses. The net upward revaluation in goodwill results from changes in estimates of amounts of shares to be issued and other deferred purchase consideration (note 13).





Additions relate to:




  Acquisitions in the period




  Cash


2,989


  Deferred purchase liability


558


  Value of shares to be issued


3,578





7,125 

  Acquisitions in prior periods




  Cash



159 





  Additions in period



7,284 

   Issue of shares and change in shares to be issued



(3,989)

   Deferred purchase liability



(558)

   Net cash movement shown in cash flow



2,737 





Acquisitions comprise of the purchase of investment management businesses and consist entirely of goodwill.





Acquisitions during the period decreased profits for the period by £0.4 million and increased revenue by £1.6 million. If the acquisitions had been effected at the start of the period profits would have decreased by a further £0.1 million and revenue increased by a further £0.3 million.







   11.  Property, plant and equipment


During the period the Group spent £2.0 million on leasehold improvements, £4.7 million on computer equipment and £0.4 million on office equipment.



   12.  Investments


Available-for-sale investments







Listed investments

Unlisted investments

Total



£'000s

£'000s

£'000s






Fair value





  At 30 March 2008


926

10,000

10,926






  At 31 March 2007


1,509

9,500

11,009






  At 30 September 2007


1,526

10,000

11,526






Unlisted available-for-sale investments represent the Group's holding of 19,899 ordinary shares in Euroclear plc. This holding represents 0.52% of Euroclear plc's shares. The Directors updated their valuation of the Group's holding in Euroclear plc to £10m as at 30 September 2007 which has remained unchanged at 30 March 2008. This valuation took into account the Group's share of net assets, dividend yield and the prices of similar quoted Companies discounted for marketability.






Trading investments







Listed investments

Unlisted investments

Total



£'000s

£'000s

£'000s

Fair value





  At 30 March 2008


1,307

-

1,307






  At 31 March 2007


1,337

-

1,337






  At 30 September 2007


1,251

-

1,251






Investments are measured at fair value which is determined directly by reference to published prices in an active market where available. 







  13.  Shares to be issued including premium and other deferred purchase liabilities


The Group acquires businesses on deferred purchase terms based on the value of income introduced over normally a three year period. The payment is normally made in ordinary shares and these have to be held typically for a further three years. At the discretion of the Board these shares can be purchased in the market rather than issued. The estimated likely cost of these shares has been updated at the half year to include new teams who have arrived and the progress of the businesses acquired

  14.  Retirement benefit obligation


    The main financial assumptions used in calculating the Group's retirement benefit     obligation are as follows:


As at 

30 March 

2008

As at 

31 March 

2007

As at 

30 September 2007

Discount rate

6.60%

5.30%

5.80%

Rate of inflation

3.50%

3.10%

3.20%

Salary increases

3.50%

3.10%

3.20%

Expected return on equities

7.60%

7.60%

7.60%

Expected return on bonds

5.20%

4.60%

5.20%

Expected return on other assets

5.75%

4.75%

5.75%

Rate of increase to pensions in payment

3.50%

3.10%

3.20%


Average assumed life expectancies for members on retirement at age 65

Existing pensioners




Males

87.0 years


86.2 years

Females

89.8 years


89.1 years

Future pensioners




Males

88.1 years


87.3 years

Females

90.9 years


90.1 years









    

    A full actuarial valuation was carried out as at 31 December 2005 and the results of this     valuation have been updated to 30 March 2008 by a qualified independent actuary and reflected     in the accounts. 

 

  15.  Note to the cash flow statement

    

    


Unaudited  26 weeks to 30 March 2008

Unaudited  26 weeks to 31 March 2007

Audited
 52 weeks to 30 September 2007


£'000s

£'000s

£'000s

Group




Operating profit

18,710 

17,985 

34,756 

Adjustments for:




 Depreciation of property, plant and equipment

3,839 

2,696 

6,057 

 Retirement benefit obligation

(5,524)

(296)

(4,267)

 Share based payment cost

313 

322 

607 

 Interest income

3,518 

2,786 

6,779 

 Interest expense

(428)

(53)

(564)

Operating cash flows before movements in working capital

20,428 

23,440 

43,368 

 Decrease/(Increase) in receivables and trading investments

65,170 

(103,773)

(104,674)

(Decrease)/Increase in payables

(101,360)

90,965 

124,647 

Cash generated by operating activities

(15,762)

10,632 

63,341 

 Tax paid

(5,345)

(3,243)

(9,158)

Net cash flow from operating activities

(21,107)

7,389 

54,183 






    Cash and cash equivalents comprise cash at bank and bank overdrafts
   16.  Reconciliation of changes in equity


Called up share capital 

 Share premium account 

 Revaluation reserve 

 Merger reserve 

 Profit and loss account 

 Total 


 £'000s

 £'000s

 £'000s

 £'000s

 £'000s

 £'000s








31 March 2007

2,015

84,885

6,978 

4,562

6,123 

104,563 

Profit for the period

-

-

- 

-

14,626 

14,626 

Dividends

-

-

- 

-

(6,869)

(6,869)

Issue of shares

20

2,083

- 

-

- 

2,103 

Revaluation

-

-

517 

-

- 

517 

Deferred tax on items taken directly to equity

-

-

49 

-

(229)

(180)

Share based payments

-

-

- 

-

285 

285 

Actuarial gain on defined benefit pension scheme

-

-

- 

-

287 

287 

30 September 2007

2,035

86,968

7,544 

4,562

14,223 

115,332 

Profit for the period

-

-

- 

-

15,353 

15,353 

Dividends

-

-

- 

-

(7,248)

(7,248)

Issue of shares

38

2,384

- 

-

- 

2,422 

Revaluation

-

-

(600)

-

- 

(600)

Deferred tax on items taken directly to equity

-

-

168 

-

(685)

(517)

Share based payments

-

-

- 

-

313 

313 

Actuarial loss on defined benefit pension scheme

-

-

- 

-

(1,570)

(1,570)

30 March 2008

2,073

89,352

7,112 

4,562

20,386 

123,485 









   17.  Provisions


Where there are any remaining legal actions in relation to split capital trusts the estimated liability has been included in other creditors with the insurance debtor included in other debtors. These amounts have not been separately disclosed as the disclosure would be seriously prejudicial to the Group. 

Funds


 At 

30 March 2008 

At 

31 March 2007 

 At 

30 September 2007 






 £ Billion 

 £ Billion 

 £ Billion 

In Group's nominee or sponsored member

10.2

9.9

10.4

Stock not held in Group's nominee

0.2

0.2

0.3

Discretionary funds under management

10.4

10.1

10.7





In Group's nominee or sponsored member

7.4

8.2

8.2

Other funds where valuations are carried out but where the stock is not under the Group's control


2.1


2.9


2.7

Advisory funds under management

9.5

11.1

10.9





Managed funds

19.9

21.2

21.6









In Group's nominee or sponsored member

2.8

2.6

3.2

Stock not held in Group's nominee

0.3

0.4

0.3

Execution only stock

3.1

3.0

3.5





Total funds

23.0

24.2

25.1





Stock




In Group's nominee or sponsored member

20.4

20.7

21.8

Stock not held in Group's nominee

2.6

3.5

3.3


23.0

24.2

25.1






Responsibility Statement


We confirm that to the best of our knowledge:

 

               (a)    the condensed set of financial statements has been prepared in accordance with     
                        IAS 34 'Interim Financial Reporting';


(b)    the interim management report* includes a fair view of the information required by     

        DTR 4.2.7 R (indication of important events during the first six months and     

        description of principal risks for the remaining six months of the year); and


(c)    the interim management report* includes a fair view of the information required by     

         DTR 4.2.8 R (disclosures of related parties' transactions and changes therein).



*encompassed within the Executive Chairman's Statement



By order of the Board




Finance Director

R A Bayford

29 May 2008

  Independent Review Report

Independent Review Report to Brewin Dolphin Holdings PLC


We have been engaged by the company to review the condensed set of financial statements in the half-yearly financial report for the 26 week period ended 30 March 2008 which comprises the consolidated income statement, the consolidated statement of recognised income and expense, the consolidated balance sheet, the consolidated cash flow statement and related notes 1 to 17. We have read the other information contained in the half-yearly financial report and considered whether it contains any apparent misstatements or material inconsistencies with the information in the condensed set of financial statements. 


This report is made solely to the company in accordance with International Standard on Review Engagements 2410 issued by the Auditing Practices Board. Our work has been undertaken so that we might state to the company those matters we are required to state to them in an independent review report and for no other purpose. To the fullest extent permitted by law, we do not accept or assume responsibility to anyone other than the company, for our review work, for this report, or for the conclusions we have formed. 


Directors' responsibilities 

The half-yearly financial report is the responsibility of, and has been approved by, the directors. The directors are responsible for preparing the half-yearly financial report in accordance with the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority. 


As disclosed in note 1
, the annual financial statements of the group are prepared in accordance with IFRSs as adopted by the European Union. The condensed set of financial statements included in this half-yearly financial report has been prepared in accordance with International Accounting Standard 34 'Interim Financial Reporting', as adopted by the European Union. 


Our responsibility 

Our responsibility is to express to the company a conclusion on the condensed set of financial statements in the half-yearly financial report based on our review.


Scope of review 

We conducted our review in accordance with International Standard on Review Engagements (UK and Ireland) 2410, 'Review of Interim Financial Information Performed by the Independent Auditor of the Entity' issued by the Auditing Practices Board for use in the United Kingdom. A review of interim financial information consists of making inquiries, primarily of persons responsible for financial and accounting matters, and applying analytical and other review procedures. A review is substantially less in scope than an audit conducted in accordance with International Standards on Auditing (UK and Ireland) and consequently does not enable us to obtain assurance that we would become aware of all significant matters that might be identified in an audit. Accordingly, we do not express an audit opinion. 


Conclusion 

Based on our review, nothing has come to our attention that causes us to believe that the condensed set of financial statements in the half-yearly financial report for the 26 week period ended 30 March 2008 is not prepared, in all material respects, in accordance with International Accounting Standard 34 as adopted by the European Union and the Disclosure and Transparency Rules of the United Kingdom's Financial Services Authority. 





Deloitte & Touche LLP 

Chartered Accountants and Registered Auditors

LondonUnited Kingdom

29 May 2008




This information is provided by RNS
The company news service from the London Stock Exchange
 
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