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Notes to the Cash Flow Statement

15 Reconciliation of Operating Profit to Net Cash Inflow from Operating Activities

2003
£m
2002
£m
Operating profit 174.0 177.3
Depreciation charge 71.3 74.7
Amortisation and impairment of intangible assets 63.5 55.5
(Increase)/decrease in stocks and work in progress (1.8) 3.0
Increase in debtors (23.7) (32.4)
Increase/(decrease) in creditors and other provisions 29.1 (13.5)
Net cash inflow from operating activities 312.4 264.6

The cash inflow noted above includes a cash outflow of £Nil (2002 £2.6 million) in respect of operating exceptional items.

16 Analysis of Cash Flows given in the Cash Flow Statement

2003 2002
Note £m £m
Returns on investments and servicing of finance
Interest received 7.5 2.5
Interest paid (62.4) (64.3)
Interest element of finance lease rental payments (2.6) (2.2)
Bond issue costs (0.2)
Premium on repurchase of exchangeable bonds (1.3)
Dividends received from other investments 5.0 5.2
Dividends paid to minority shareholders (4.8) (4.6)
(57.5) (64.7)
Taxation
Tax paid (33.8) (36.6)
Tax repaid 8.1 11.7
(25.7) (24.9)
Capital expenditure and financial investment (net)
Purchase of tangible fixed assets (93.7) (89.8)
Purchase of investments (4.8) (13.2)
Disposal of tangible fixed assets 4.8 17.7
Disposal of investments 0.3 0.9
(93.4) (84.4)
Acquisitions and disposals
Purchase of businesses 18 (44.4) (84.9)
Purchase of radio licences 18 (3.3) (5.0)
Cash acquired with subsidiaries 2.2
Investments in joint ventures and associates (12.5) (13.2)
Disposal of businesses 18 6.5 1.9
Disposal of associates 0.2
(51.5) (101.0)
Financing
Issue of bonds 173.9
Issue of share capital 0.6 0.3
Loans taken out 28.0
Repurchase of exchangeable bonds (61.2) (12.3)
Repayment of other borrowings (204.4)
Repayment of loan by associates 1.5 0.4
Treasury hedging activities (3.2) (6.5)
Cash received on sale and lease back 13.1
Capital element of finance lease rental payments(5.6) (6.8)
Net cash inflow from financing (85.3) 3.1

17 Analysis of Net Debt

View the Analysis of Net Debt.
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18 Analysis of Movements in Cash in respect of Acquisitions and Disposals

2003 2002
Note £m £m
Acquisitions
Cash consideration including acquisition expenses 35 37.4 72.8
Cash paid in respect of consideration deferred from prior years 7.0 12.1
Cash consideration including acquisition expenses – radio licences 3.3
47.7 84.9

Cash paid in respect of consideration deferred from prior years was mainly in respect of the business to business information and careers division.

2003 2002
Note £m £m
Disposals
Cash consideration including disposal costs 36 6.5 1.9

The impact of operating cash flows from acquisitions and disposals made in the year was not material.

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