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- Financial Section
- Notes to the Cash Flow Statement
NOTES TO THE CASHFLOW STATEMENT
15 Reconciliation of Operating Profit to Net Cash Inflow from Operating Activities
| 2004 £m | 2003 (restated)* £m | |
|---|---|---|
| Operating profit | 181.7 | 174.4 |
| Depreciation charge | 84.5 | 71.3 |
| Amortisation and impairment of intangible assets | 84.1 | 63.5 |
| Decrease / (increase) in stocks and work in progress | 4.8 | (1.8) |
| Increase in debtors | (3.4) | (23.7) |
| Increase in creditors and other provisions | 30.7 | 28.7 |
| Net cash inflow from operating activities | 382.4 | 312.4 |
The cash inflow noted above includes a cash outflow of £0.5 million (2003 £Nil million) in respect of operating exceptional items.
16 Analysis of Cash Flows given in the Cash Flow Statement
| Note | 2004 £m | 2003 £m | |
|---|---|---|---|
| Returns on investments and servicing of finance | |||
| Interest received | 8.6 | 7.5 | |
| Interest paid | (64.1) | (62.4) | |
| Interest element of finance lease rental payments | (1.5) | (2.6) | |
| Bond issue costs | – | (0.2) | |
| Dividends received from other investments | 3.4 | 5.0 | |
| Dividends paid to minority shareholders | (4.5) | (4.8) | |
| (58.1) | (57.5) | ||
| Taxation | |||
| Tax paid | (25.2) | (33.8) | |
| Tax repaid | 10.9 | 8.1 | |
| (14.3) | (25.7) | ||
| Capital expenditure and financial investment (net) | |||
| Purchase of tangible fixed assets | (102.8) | (93.7) | |
| Purchase of investments | (0.2) | (1.6) | |
| Disposal of tangible fixed assets | 8.2 | 4.8 | |
| Disposal of investments | 9.1 | 0.3 | |
| (85.7) | (90.2) | ||
| Acquisitions and disposals | |||
| Purchase of businesses | 18 | (111.3) | (44.4) |
| Purchase of radio licences | 18 | (106.4) | (3.3) |
| Cash acquired with subsidiaries | 35 | 10.6 | 2.2 |
| Investments in joint ventures and associates | (4.9) | (12.5) | |
| Disposal of businesses | 18 | 83.5 | 6.5 |
| (128.5) | (51.5) | ||
| Financing | |||
| Issue of bonds | – | 173.9 | |
| Issue of share capital | 0.2 | 0.6 | |
| Issue of shares by Group companies to minority interests | 0.6 | – | |
| Purchase of own shares | (32.6) | (3.2) | |
| Disposal of own shares held by DMGT Share Trust | 28.2 | – | |
| Repurchase of Exchangeable Bonds | – | (61.2) | |
| Repayment of other borrowings | (24.8) | (204.4) | |
* See note 34
| 2004 £m | 2003 £m | |
|---|---|---|
| Repayment of loan by associates | 1.4 | 1.5 |
| Treasury hedging activities | 26.8 | (3.2) |
| Cash received on sale and lease back | – | 13.1 |
| Capital element of finance lease rental payments | (18.9) | (5.6) |
| Net cash inflow from financing | (19.1) | (88.5) |
| Note | At beginning of year £m | Cash flow £m | Acquisition (excluding cash and overdrafts) £m | Transfer between categories £m | Foreign exchange movements £m | Other non-cash charges £m | At end of year £m | |
|---|---|---|---|---|---|---|---|---|
| Cash | 44.8 | 44.3 | – | – | (1.1) | – | 88.0 | |
| Bank overdrafts | (0.3) | (1.1) | – | – | 0.1 | – | (1.3) | |
| 44.5 | 43.2 | – | – | (1.0) | – | 86.7 | ||
| Debt due within one year | i, iii | (35.7) | 29.1 | (2.2) | (105.2) | 10.0 | (1.9) | (105.9) |
| Debt due after one year | ||||||||
| Bonds | ii | (745.8) | – | – | – | – | 0.5 | (745.3) |
| Loans | i | (101.1) | (4.3) | – | 105.2 | – | – | (0.2) |
| (882.6) | 24.8 | (2.2) | – | 10.0 | (1.4) | (851.4) | ||
| Finance lease obligations | (38.7) | 18.9 | – | – | – | – | (19.8) | |
| (921.3) | 43.7 | (2.2) | – | 10.0 | (1.4) | (871.2) | ||
| Short term investments | 29 | 3.6 | 1.3 | – | – | (0.2) | – | 4.7 |
| Net debt | (873.2) | 88.2 | (2.2) | – | 8.8 | (1.4) | (779.8) | |
(i) The transfer between categories occurs since these borrowings were drawn on bank facilities expiring within one year at the balance sheet date. On 4th October, 2004 the Group renewed its committed borrowing facilities for a five year period.
(ii) Other non-cash movements in respect of bonds include the unwinding of the premium on the 2021 10% bonds in the year of £0.5 million and on the 2013 7.5% bonds of £0.3 million offset by the amortisation of issue costs of £0.3 million.
(iii) Other non-cash movements in respect of debt due after one year comprises accrued interest of £1.9 million.
18 Analysis of Movements in Cash in respect of Acquisitions and Disposals
| Note | 2004 £m | 2003 £m | |
|---|---|---|---|
| Acquisitions | |||
| Cash consideration including acquisition expenses – businesses | 35 | 102.3 | 37.4 |
| Cash paid in respect of consideration deferred from prior years | 9.0 | 7.0 | |
| 111.3 | 44.4 | ||
| Cash consideration including acquisition expenses – radio licences | 35 | 106.4 | 3.3 |
| 217.7 | 47.7 | ||
Cash paid in respect of consideration deferred from prior years was mainly in respect of the business to business information and careers division.
| Note | 2004 £m | 2003 £m | |
|---|---|---|---|
| Disposals | |||
| Cash consideration including disposal costs | 36 | 83.5 | 6.5 |
The impact of operating cash flows from acquisitions and disposals made in the year was not material.