Notes 13, 14, 15 and 16

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13. Reserves

	Share Premium account £m	Capital Redemption reserve £m	Revaluation reserve £m	Merger reserve £m	Other reserves £m	Profit and loss account £m
At 1 January 2005	2.7	1.6	0.9	9.7	44.0	13.1
Prior year adjustment	-	-	-	-	-	3.7
At 1 January 2005 restated	2.7	1.6	0.9	9.7	44.0	16.8
Loss for the year	-	-	-	-	-	(1.2)
Dividends paid						(6.1)
31 December 2005	2.7	1.6	0.9	9.7	44.0	9.5

Other reserves represents the capitalisation of the share premium account, £22.7 million in 1989 and £37.3 million in 1995, less £16 million of share repurchases in 1995.

During the year the Company adopted FRS 21 Events after the Balance Sheet Date which superseded SSAP 17. Under the new standard, final dividends payable are recognised only in the period in which they are declared at the Annual General Meeting and therefore become a liability and interim dividends are recognised in the period in which they are paid, whereas under SSAP 17 dividends were accrued for when proposed. This has resulted in an increase of £3.7 million in retained profits at 1 January 2005.

In 2002 the Company purchased 142,857 own shares, representing 0.3% (2004: 0.3%) of the called up share capital of the Company at an average price of 314.26p per share in connection with a share option made to Gareth Rhys Williams. These shares are being held in trust by Mourant & Co Trustees Limited. Further details of these own shares can be found in the Remuneration Report.

14. Financial Instruments

i) Analysis of borrowings	2005 £m	2004 £m
Bank loans	17.2	24.7
Gross financial liabilities	17.2	24.7

ii) Maturity profile	2005 £m	2004 £m
Within one year or less	-	24.7
More than two years but not more than five years	17.2	-
	17.2	24.7

The total amount of bank loans any part of which falls due after five years is £nil (2004: £nil).

The Company had the following undrawn borrowing facilities at the end of the period:

	2005 £m	2004 £m
Expiring in one year or less
- committed facilities	-	30.3
- uncommitted facilities	8.6	13.5
More than two years but not more than five years
- committed facilities	82.8	-
Total	91.4	43.8

On 25 January 2005 the Group signed a five year £100 million Multicurrency Revolving Credit Facility Agreement with a syndicate of UK banks.

iii) Interest rate profile

Currency	Total £m	Floating rate borrowings £m
US$	3.5	3.5
Euro	13.7	13.7
At 31 December 2005	17.2	17.2

Sterling	12.0	12.0
US$	4.2	4.2
Euro	8.5	8.5
At 31 December 2004	24.7	24.7

The floating rate borrowings comprise bank loans bearing interest at rates based on LIBOR.

b) Financial assets

	2005 £m	2004 £m
Currency
Sterling	5.6	18.6
US$	-	(0.3)
Euro	(0.3)	(1.0)
Other	-	0.2
Total cash balances	5.3	17.5

The floating rate financial assets comprise bank balances bearing interest at rates based on LIBOR.

Sterling, US Dollar, Euro and Yen balances within the UK can be offset.

c) Fair value of financial assets and liabilities

	Book value £m	2005 Fair value £m	Book value £m	2004 Fair value £m
Cash at bank and in hand	5.3	5.3	17.5	17.5
Floating rate borrowings	(17.2)	(17.2)	(24.7)	(24.7)
Forward exchange contracts - Assets	1.1	1.1	0.3	0.3
Forward exchange contracts - Liabilities	(1.1)	(1.1)	(0.3)	(0.3)
Option exchange contracts - Assets	0.1	0.1	1.2	1.2
Option exchange contracts - Liabilities	(0.1)	(0.1)	(1.2)	(1.2)
	(11.9)	(11.9)	(7.2)	(7.2)

Market rates have been used to determine fair values.

The Company has equal and opposite internal foreign exchange contracts matching the external foreign exchange contracts the Company has taken out with financial institutions.

Estimation of Fair Values
The following summarises the major methods and assumptions used in estimating the fair values of financial instruments reflected in the table:

Derivatives
Forwards are marked to market by calculating the contractual forward price and deducting the current spot rate. Options and cylinders are marked to market by obtaining quotes from banks of their market value as at 31 December.

(i) Maturity profile of Derivatives

	Within one year or less £m	More than one year but not more than two years £m	2005 More than two years £m
Forward exchange contracts - Assets	0.1	-	-
Forward exchange contracts - Liabilities	(0.9)	(0.1)	-
Option exchange contracts - Assets	0.1	-	-
Option exchange contracts - Liabilities	-	-	-
	(0.7)	(0.1)	-

	£m	£m	2004 £m
Forward exchange contracts - Assets	0.3	-	-
Option exchange contracts - Assets	1.2	-	-
	1.5

All the options are to sell Euros for US Dollars and have an exercise price between US$1.15 = €1 and US$1.31 = €1.

During 2003 and 2004 forward option contracts selling US Dollars and purchasing Euros were taken out to cover anticipated US Dollar currency receipts covering the period January 2005 to December 2005. These forward option contracts totalled £9.3 million. In 2005 further forward option contracts selling US Dollars and purchasing Euros, totalling $21.9 million, were taken out to cover anticipated US Dollar currency receipts covering the period January 2006 to June 2007 and the unrecognised gains on all these options at 31 December 2005, based on the exchange rates on that date, were £nil million (2004: £1.1 million). The Group’s foreign exchange hedging policy is set out in the Financial Review.

During 2004 forward option contracts selling US Dollars and purchasing Sterling were taken out to cover anticipated US Dollar receipts covering the period January 2005 to August 2005. These totalled £0.9 million.

Interest bearing loans and borrowings
All interest bearing loans and borrowings are at floating rates. Therefore, the fair value of these loans and borrowings is their carrying value.