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- Financial Statements
- Notes to the Consolidated Cash Flow Statement
NOTES TO THE CONSOLIDATED CASH FLOW STATEMENT
13 Analysis of net debt
Note | At beginning of year £m | Cash flow £m | Change in mark to market value £m | On disposal of subsidiaries Note 17 £m | On acquisition of subsidiaries Note 16 £m | Issued on acquisition of subsidiaries Note 16 £m | Foreign exchange movements £m | Other non-cash movements £m | At end of year £m | |
|---|---|---|---|---|---|---|---|---|---|---|
| Cash and cash equivalents | 25 | 124.2 | (24.3) | - | - | - | - | (2.6) | - | 97.3 |
| Bank overdrafts | (0.2) | (1.1) | - | - | - | - | 0.1 | - | (1.2) | |
| Net cash and cash equivalents | 124.0 | (25.4) | - | - | - | - | (2.5) | - | 96.1 | |
| Debt due within one year | (11.0) | 3.6 | - | - | (3.2) | (0.5) | - | - | (11.1) | |
| Debt due after one year | ||||||||||
| Bonds | (656.9) | - | 2.3 | - | - | - | - | 0.7 | (653.9) | |
| Bank loans | (205.3) | 22.2 | - | - | - | - | 5.0 | - | (178.1) | |
| (873.2) | 25.8 | 2.3 | - | (3.2) | (0.5) | 5.0 | 0.7 | (843.1) | ||
| Finance lease obligations | (14.3) | 7.3 | - | 7.0 | - | - | - | - | - | |
| (887.5) | 33.1 | 2.3 | 7.0 | (3.2) | (0.5) | 5.0 | 0.7 | (843.1) | ||
| Effect of derivatives on bank loans | (3.5) | 3.5 | (2.3) | - | - | - | 11.1 | - | 8.8 | |
| Net debt | (767.0) | 11.2 | - | 7.0 | (3.2) | (0.5) | 13.6 | 0.7 | (738.2) |
Other non-cash movements in respect of bonds include the unwinding of premium of £1.0 million offset by the amortisation of issue costs of £0.3 million.
14 Analysis of movements in cash in respect of acquisitions and disposals
Note | 2006 £m | 2005 £m | |
|---|---|---|---|
| Acquisitions | |||
| Cash consideration including acquisition expenses | 15 | 260.8 | 80.7 |
| Cash paid in respect of consideration deferred from prior years | 32 | 36.5 | 21.5 |
| Cash and cash equivalents acquired with subsidiaries | 15 | (3.9) | - |
| 293.4 | 102.2 |
Cash paid in respect of consideration deferred from prior years was mainly in respect of the business to business information and careers division.
During the year, the Group acquired businesses which had contributed £8.3 million to the Group’s net operating cash flows, paid £0.6 million in respect of investing activities and paid £0.1 million in respect of financing activities.
Note | 2006 £m | 2005 £m | |
|---|---|---|---|
| Disposals | |||
| Cash consideration including disposal costs | 16 | 186.5 | 8.4 |
| Cash consideration including disposal costs - associates | - | 7.3 | |
| 186.5 | 15.7 |
During the year, the Group disposed of businesses which had contributed £11.1 million to the Group’s net operating cash flows, paid £1.3 million in respect of investing activities and paid £0.4 million in respect of financing activities.
15 Summary of the effects of acquisitions
The principal acquisitions completed during the year, the percentage of voting rights acquired and the dates of acquisition were as follows:
| Expressions of Culture | 100% of common stock | Exhibitions and related activities | November, 2005 |
| Primelocation.com | 98.6% of ordinary shares | National newspapers and related activities | November, 2005 |
| Profesia | 100% of ordinary shares | Regional newspapers and related activities | November, 2005 |
| Genscape | 99.8% of common stock | Business to business information and careers | April, 2006 |
| Allegran | 100% of ordinary shares | National newspapers and related activities | May, 2006 |
| Data Media and Retail | 62.5% of ordinary shares | National newspapers and related activities | May, 2006 |
| Abu Dhabi International Petroleum Exhibition and Conference | Asset purchase | Exhibitions and related activities | June, 2006 |
| Evanta | Asset purchase | Exhibitions and related activities | June, 2006 |
| Auto Exposure Limited | 100% of ordinary shares | National newspapers and related activities | July, 2006 |
| Interbase Limited | 100% of ordinary shares | National newspapers and related activities | July, 2006 |
| The Appointment Limited | 100% of ordinary shares | National newspapers and related activities | July, 2006 |
| Perex a.s. | 100% of ordinary shares | Regional newspapers and related activities | August, 2006 |
The aggregate consideration for these and other businesses was £309.1 million, of which £260.8 million was paid in cash during the year, £0.5 million issued in the form of loan notes and an estimated amount of £38.9 million payable in the form of deferred consideration, depending upon trading results. This deferred consideration has been discounted back to current values in accordance with IFRS 3 Fair Values in Acquisition Accounting. In each case, the Group has used acquisition accounting to account for the purchase.
The impact of acquisition of businesses on net assets was:
Note | Net book values £m | Provisional fair value adjustments £m | Provisional fair value £m | |
|---|---|---|---|---|
| Net assets acquired: | ||||
| Tangible fixed assets | 19 | 4.1 | - | 4.1 |
| Stocks | 0.3 | - | 0.3 | |
| Debtors and prepayments | 24.2 | - | 24.2 | |
| Cash at bank and in hand | 14 | 3.9 | - | 3.9 |
| Current liabilities | (21.1) | - | (21.1) | |
| Corporation tax | (1.1) | - | (1.1) | |
| Bank loans and overdrafts | 13 | (3.2) | - | (3.2) |
| Deferred consideration | 32 | (4.9) | - | (4.9) |
| Deferred tax liabilities | 33 | (6.1) | (29.3) | (35.4) |
| (33.2) | ||||
| Goodwill | 17 | 161.7 | ||
| Intangible assets | 18 | 180.6 | ||
| Fair value of consideration | 309.1 | |||
| Satisfied by: | ||||
| Cash | 14 | 260.8 | ||
| Deferred consideration | 32 | 38.9 | ||
| Transfer from joint ventures and associates | 20 | 8.9 | ||
| Loan notes | 0.5 | |||
| 309.1 |
16 Summary of the effects of disposals
The principal disposals completed during the year, the proceeds received and dates of disposal were as follows:
| Aberdeen Journals Limited | £116.9 m | April, 2006 |
| Study Group International Limited | £66.7 m | September, 2006 |
The impact of disposals of businesses on net assets was:
| Note | £m | |
|---|---|---|
| Net assets disposed of: | ||
| Goodwill | 17 | 2.3 |
| Intangible assets | 18 | 8.6 |
| Tangible fixed assets | 19 | 28.1 |
| Inventories | 0.8 | |
| Debtors | 61.7 | |
| Creditors and provisions | (77.4) | |
| Finance lease obligations | 13 | (7.0) |
| Corporation tax | (3.9) | |
| Deferred consideration | 32 | (0.8) |
| Deferred tax liabilities | 33 | (0.7) |
| 11.7 | ||
| Profit on disposal of businesses | 6 | 174.8 |
| 186.5 | ||
| Satisfied by: | ||
| Cash | 186.5 |