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Notes to the Accounts (19-22)
19 Provisions for liabilities and charges
| |
Total
£m |
Deferred
tax
£m |
Exceptional
restructuring
£m |
Pensions
£m |
Group
Other
provisions
£m |
Total
£m |
Company
Deferred
tax
£m |
| At 1 January 2004 |
12.4 |
3.7 |
2.1 |
4.4 |
2.2 |
0.1 |
0.1 |
| Currency translation adjustments |
(0.3) |
(0.3) |
- |
- |
- |
- |
- |
| Transfers from current tax |
(0.9) |
(0.9) |
- |
- |
- |
- |
- |
| Profit and loss account |
3.4 |
1.6 |
2.1 |
0.4 |
(0.7) |
- |
- |
| Utilised in year |
(3.2) |
- |
(2.7) |
(0.4) |
(0.1) |
- |
- |
| At 31 December 2004 |
11.4 |
4.1 |
1.5 |
4.4 |
1.4 |
0.1 |
0.1 |
The pension provision of £4.4 million (2003: £4.4 million) is to cover accrued statutory entitlements that will be paid to employees in
Italy, Germany and Japan when they leave employment of the Group.
The remaining other provisions comprise warranty provisions of £1.0 million (2003: £0.7 million) and the provision for the upgrade of
retail units of £0.4million (2003: £1.5 million).
The exceptional restructuring provision will be utilised in 2005.
| |
2004
£m |
Group
2003
£m |
2004
£m |
Company
2003
£m |
| Composition of deferred tax provision |
|
|
|
|
| Accelerated tax depreciation allowances |
3.2 |
2.4 |
0.1 |
0.1 |
| Other timing differences |
0.9 |
1.3 |
- |
- |
| |
4.1 |
3.7 |
0.1 |
0.1 |
20 Acquisitions of businesses
On 30 March 2004 the Group acquired the operating assets and certain liabilities of Charter Broadcast North America Inc., a
provider of broadcast rental equipment in the United States and Canada, for a nominal sum which, with transaction costs,
brought the total acquisition cost to US$0.1 million cash (£0.1 million). Based on a provisional assessment of fair values,
negative goodwill of £0.6 million arose on acquisition.
The acquisition was funded from existing cash resources and has been accounted for using the acquisition method of
accounting.
| |
Book
value
£m |
Policy
alignment
£m |
Fair value
adjustments
£m |
As
adjusted
£m |
| Net Assets acquired |
|
|
|
|
| Intangible fixed assets |
|
|
|
|
| Tangible fixed assets |
0.8 |
|
0.1 |
0.9 |
| Stocks |
|
|
|
|
| Debtors |
|
|
|
|
| Creditors |
|
|
(0.2) |
(0.2) |
| |
0.8 |
|
(0.1) |
0.7 |
| Negative goodwill (1) |
(0.6) |
| Total cost of acquisition, including expenses, satisfied by cash |
0.1 |
(1) Negative goodwill is recognised in the profit and loss account in the periods in which the non-monetary assets are recovered, through depreciation or sale.
| |
£m |
| Net outflow of cash in respect of acquisitions |
|
| Total cost of acquisitions including expenses |
0.1 |
| Net cash acquired |
- |
| Total outflow of cash from Group |
0.1 |
The results of Charter Broadcast North America Inc. have been included in the Broadcast Services Division and comprise.
| |
£m |
| Turnover |
1.8 |
| Cost of sales |
(1.0) |
| Operating expenses |
(0.2) |
| Operating profit before goodwill amortisation |
0.6 |
The fair value adjustments represent an increase in book value of rental assets following an appraisal exercise and a recognition of
liabilities in respect of refurbishment costs.
On 8 January 2004 the Group acquired the domestic distribution activity of Multiblitz (Dr. Ing. D.A. Mannesmann GmbH & Co),
a distributor of the Group’s Manfrotto products in Germany, for c2.0 million cash (£1.4 million). Based on a provisional
assessment of fair values, goodwill of £1.0 million arose on acquisition.
The acquisition was funded from existing cash resources and has been accounted for using the acquisition method of
accounting.
| |
Book
value
£m |
Policy
alignment
£m |
Fair value
adjustments
£m |
As
adjusted
£m |
| Net Assets acquired |
|
|
|
|
| Intangible fixed assets |
|
|
|
|
| Tangible fixed assets |
|
|
|
|
| Stocks |
0.3 |
|
|
0.3 |
| Debtors |
0.2 |
|
|
0.2 |
| Creditors |
(0.1) |
|
|
(0.1) |
| |
0.4 |
|
|
0.4 |
| Purchased goodwill (being amortised over 10 years) |
1.0 |
| Total cost of acquisition, including expenses, satisfied by cash |
1.4 |
| |
£m |
| Net outflow of cash in respect of acquisitions |
|
| Total cost of acquisitions including expenses |
1.4 |
| Net cash acquired |
- |
| Total outflow of cash from Group |
1.4 |
The results of Multiblitz have been included in the Photographic Division and comprise
| |
£m |
| Turnover |
3.5 |
| Cost of sales |
(2.4) |
| Operating expenses |
(1.0) |
| Operating profit before goodwill amortisation |
0.1 |
21 Share capital
The authorised share capital at 31 December 2004 consisted of 65,000,000 (2003: 65,000,000) shares of 20p each, of which 41,081,105 were allotted and fully paid. The movement during the year was:
| |
Shares |
Issued share
capital
£m |
| At 1 January 2004 |
41,037,301 |
8.2 |
| Exercise of share options |
43,804 |
- |
| At 31 December 2004 |
41,081,105 |
8.2 |
At 31 December 2004 the following options had been granted and remained outstanding under the Company’s share option
schemes:
| |
Number of
shares |
Exercise
prices |
Dates
normally
exercisable |
| United Kingdom SAYE schemes |
288,474 |
231p - 595p |
2005 - 2011 |
| International SAYE schemes |
284,314 |
231p - 492p |
2005 - 2009 |
| Executive schemes |
1,322,394 |
257.5p - 653p |
2005 - 2014 |
| Premium Option Plan |
335,910 |
793p - 819p |
2005 - 2010 |
| |
2,231,092 |
|
|
On 23 March 2004, awards over an aggregate of 160,537 shares in the Company were made to six senior Group executives
under the Company’s Long Term Incentive Plan. The total number of shares outstanding at 31 December 2004 under the
Company’s Long Term Incentive Plan was 476,283 (2003: 447,209). The terms of the awards and the related performance
conditions are described in the Remuneration Report.
On 25 May 2004, awards over an aggregate of 20,203 shares in the Company were made to five senior Group executives under
the Company’s Deferred Bonus Plan. The total number of shares outstanding at 31 December 2004 under the Company’s
Deferred Bonus Plan was 47,295 (2003: 63,709). The terms of the awards and the related performance conditions are
described in the Remuneration Report.
22 Reserves
| |
Share
Premium
account
£m |
Capital
Redemption
reserve
£m |
Revaluation
reserve
£m |
Merger
reserve
£m |
Other
reserves
£m |
Profit
and loss
account
£m |
| Group |
|
|
|
|
|
|
| At 1 January 2004 (as previously reported) |
2.6 |
1.6 |
1.5 |
- |
- |
46.4 |
| Prior year adjustment for ESOP accounting (see Note 1) |
- |
- |
- |
- |
- |
(0.5) |
| At 1 January 2004 (restated(1)) |
2.6 |
1.6 |
1.5 |
- |
- |
45.9 |
| Retained profit for the year |
|
|
|
|
|
0.3 |
| Premium on new shares issued |
0.1 |
|
|
|
|
|
| Transfers |
|
|
(0.1) |
|
|
0.1 |
| Exchange rate movement on foreign net investments |
- |
- |
- |
- |
- |
(3.5) |
| 31 December 2004 |
2.7 |
1.6 |
1.4 |
- |
- |
42.8 |
At 31 December 2004 the cumulative goodwill written off on acquisitions prior to 1 January 1998 amounted to £126.2 million
(2003: £126.2 million).
| |
Share
Premium
account
£m |
Capital
Redemption
reserve
£m |
Revaluation
reserve
£m |
Merger
reserve
£m |
Other
reserves
£m |
Profit
and loss
account
£m |
| Company |
|
|
|
|
|
|
| At 1 January 2004 (as previously reported) |
2.6 |
1.6 |
0.9 |
9.7 |
44.0 |
18.3 |
| Prior year adjustment for ESOP accounting (see Note 1) |
- |
- |
- |
- |
- |
(0.5) |
| At 1 January 2004 (restated(1)) |
2.6 |
1.6 |
0.9 |
9.7 |
44.0 |
17.8 |
| Retained loss for the year |
|
|
|
|
|
(4.3) |
| Exchange rate movement on foreign net investments |
- |
- |
- |
- |
- |
(0.4) |
| Premium on new shares issued |
0.1 |
|
|
|
|
|
| 31 December 2004 |
2.7 |
1.6 |
0.9 |
9.7 |
44.0 |
13.1 |
(1) Shareholders funds have been restated to show the investment held in respect of grants under share option schemes as a deduction (see Note 1).
At 31 December 2004, this investment represents 142,857 (2003: 142,857) ordinary shares with a market vaue of £408,571 (2003: £494,285).
As permitted by Section 230 (4) of the Companies Act 1985 the Company has not presented its own profit and loss account.
The amount of the Group result for the financial year dealt with in the accounts of the Company was a profit after tax of £1.8
million (2003: £16.2 million).
Information correct at 13/04/05