REG - Burberry Group PLC - Preliminary Results <Origin Href="QuoteRef">BRBY.L</Origin> - Part 2
15/07/2015 18:29
- Part 2: For the preceding part double click ID:nRST7103Na
- - - - - 0.4 0.4
Dividends paid in the year - - - (144.9) (144.9) (0.4) (145.3)
Balance as at 31 March 2015 0.2 207.6 192.3 1,000.8 1,400.9 50.6 1,451.5
Group Statement of Cash Flows
Note Year to Year to
31 March 31 March
2015 2014
£m £m
Cash flows from operating activities
Operating profit 440.3 445.4
Depreciation 104.0 105.6
Amortisation 34.6 33.0
Net impairment charges 4.1 12.3
Loss/(profit) on disposal of property, plant and equipment and intangible assets 2.1 (1.3)
Gain on derivative instruments (2.0) (3.8)
Charges in respect of employee share incentive schemes 21.0 25.4
(Payment)/proceeds from settlement of equity swap contracts (0.2) 15.7
Increase in inventories (15.1) (68.2)
Increase in receivables (43.8) (73.8)
Increase in payables 23.1 45.2
Cash generated from operating activities 568.1 535.5
Interest received 3.8 3.4
Interest paid (2.6) (2.6)
Taxation paid (114.4) (111.1)
Net cash generated from operating activities 454.9 425.2
Cash flows from investing activities
Purchase of property, plant and equipment (127.8) (129.5)
Purchase of intangible assets (27.9) (24.5)
Proceeds from sale of property, plant and equipment - 3.0
Proceeds from sale of intangible assets 1.3 -
Acquisition of subsidiaries, net of cash acquired - (2.6)
Net cash outflow from investing activities (154.4) (153.6)
Cash flows from financing activities
Dividends paid in the year 11 (144.9) (130.7)
Dividends paid to non-controlling interest (0.4) -
Capital contributions by non-controlling interest 0.4 0.7
Payment to acquire additional interest in subsidiary from non-controlling interest (3.4) -
Issue of ordinary share capital 2.8 1.2
Sale of own shares by ESOP trusts - 1.7
Purchase of own shares by ESOP trusts (19.2) (24.7)
Net cash outflow from financing activities (164.7) (151.8)
Net increase in cash and cash equivalents 135.8 119.8
Effect of exchange rate changes 13.9 (13.9)
Cash and cash equivalents at beginning of year 402.5 296.6
Cash and cash equivalents at end of year 552.2 402.5
Analysis of Net Cash
Note As at As at
31 March 31 March
2015 2014
£m £m
Cash and cash equivalents as per the Balance Sheet 16 617.4 545.5
Bank overdrafts 19 (65.2) (143.0)
Net cash 552.2 402.5
Notes to the Financial Information
1. Basis of preparation
The financial information contained within this report has been prepared in
accordance with the European Union endorsed International Financial Reporting
Standards (IFRSs), IFRS Interpretations Committee (IFRS IC) interpretations
and parts of the Companies Act 2006 applicable to companies reporting under
IFRS. This financial information does not constitute the Burberry Group's (the
Group) Annual Report and Accounts within the meaning of Section 435 of the
Companies Act 2006.
Statutory accounts for the year ended 31 March 2014 have been filed with the
Registrar of Companies, and those for 2015 will be delivered in due course.
The reports of the auditors on those statutory accounts for the years ended 31
March 2014 and 31 March 2015 were unqualified, did not contain an emphasis of
matter paragraph and did not contain a statement under either section 400(2)
or section 498(3) of the Companies Act 2006.
The principal accounting policies applied in the preparation of the
consolidated financial statements are consistent with those set out in the
statutory accounts for the year ended 31 March 2014, with the exception of the
adoption of the amendment to IAS 32: Financial instruments: Presentation,
which was adopted for the first time by the Group from 1 April 2014. This has
not had a material impact on the financial statements of the Group.
2. Translation of the results of overseas businesses
The results of overseas subsidiaries are translated into the Group's
presentation currency of Sterling each month at the weighted average exchange
rate for the month according to the phasing of the Group's trading results.
The weighted average exchange rate is used, as it is considered to approximate
the actual exchange rates on the date of the transactions. The assets and
liabilities of such undertakings are translated at the year end exchange
rates. Differences arising on the retranslation of the opening net investment
in subsidiary companies, and on the translation of their results, are taken
directly to the foreign currency translation reserve.
Goodwill and fair value adjustments arising on the acquisition of a foreign
operation are treated as assets and liabilities
of the foreign operation and translated at the closing rate.
The principal exchange rates used were as follows:
Average rate Closing rate
Year to Year to As at As at
31 March 31 March 31 March 31 March
2015 2014 2015 2014
Euro 1.28 1.19 1.38 1.21
US Dollar 1.60 1.59 1.48 1.67
Chinese Yuan Renminbi 9.94 9.78 9.21 10.34
Hong Kong Dollar 12.42 12.38 11.51 12.94
Korean Won 1,709 1,734 1,646 1,771
The average exchange rate achieved by the Group on its Yen royalty income,
taking into account its use of Yen forward foreign exchange contracts executed
on a monthly basis approximately 12 months in advance of royalty receipts, was
Yen 164.2: £1 in the year to 31 March 2015 (2014: Yen 137.0: £1).
3. Adjusted profit before taxation
In order to provide additional consideration of the underlying performance of
the Group's ongoing business, the Group's results include a presentation of
Adjusted Profit before Taxation ('adjusted PBT'). Adjusted PBT is defined as
profit before taxation and before adjusting items. Adjusting items are those
items which, in the opinion of the directors, should be excluded in order to
provide a consistent and comparable view of the underlying performance of the
Group's ongoing business. Generally this will include those items that are
largely one-off and material in nature and any fair value movements on options
over equity interests held for non-speculative purposes. Adjusting items are
identified and presented on a consistent basis each year and a reconciliation
of adjusted PBT to profit before tax is included in the financial statements.
Adjusting items and their related tax impacts are added back/deducted from
profit attributable to owners of the Company to arrive at adjusted earnings
per share.
Notes to the Financial Information
4. Segmental analysis
The Chief Operating Decision Maker has been identified as the Board of
Directors. The Board reviews the Group's internal reporting in order to assess
performance and allocate resources. Management has determined the operating
segments based on the reports used by the Board.
The Board considers the Group's business through its two channels to market,
being retail/wholesale and licensing.
Retail/wholesale revenues are generated by the sale of luxury goods through
Burberry mainline stores, concessions, outlets and digital commerce as well as
Burberry franchisees, prestige department stores globally and multi-brand
specialty accounts. The flow of global product between retail and wholesale
channels and across our regions is monitored and optimised at a corporate
level and implemented via the Group's inventory hubs situated in Asia, Europe
and the USA.
Licensing revenues are generated through the receipt of royalties from the
Group's partners in Japan and global licensees of eyewear, timepieces and
European childrenswear.
The Board assesses channel performance based on a measure of adjusted
operating profit. This measurement basis excludes the effects of adjusting
items. The measure of earnings for each operating segment that is reviewed by
the Board includes an allocation of corporate and central costs. Interest
income and charges are not included in the result for each operating segment
that is reviewed by the Board.
Retail/Wholesale Licensing Total
Year to Year to Year to Year to Year to Year to
31 March 31 March 31 March 31 March 31 March 31 March
2015 2014 2015 2014 2015 2014
£m £m £m £m £m £m
Retail 1,807.4 1,622.6 - - 1,807.4 1,622.6
Wholesale 648.1 628.0 - - 648.1 628.0
Licensing - - 70.1 81.6 70.1 81.6
Total segment revenue 2,455.5 2,250.6 70.1 81.6 2,525.6 2,332.2
Inter-segment revenue1 - - (2.4) (2.4) (2.4) (2.4)
Revenue from external customers 2,455.5 2,250.6 67.7 79.2 2,523.2 2,329.8
Depreciation and amortisation 138.7 138.6 - - 138.7 138.6
Net impairment charges 4.1 12.3 - - 4.1 12.3
Other non-cash expenses:
Share based payments 17.8 21.6 3.2 3.8 21.0 25.4
Adjusted operating profit 399.2 393.5 56.0 66.8 455.2 460.3
Adjusting items2 (11.2) (16.6)
Finance income 4.4 3.9
Finance expense (3.8) (3.2)
Profit before taxation 444.6 444.4
1 Inter-segment transfers or transactions are entered into under the normal
commercial terms and conditions that would be available to unrelated third
parties.
2 Refer to note 7 for details of adjusting items.
Notes to the Financial Information
4. Segmental analysis (continued)
Segmental asset analysis
Retail/Wholesale Licensing Total
Year to Year to Year to Year to Year to Year to
31 March 31 March 31 March 31 March 31 March 31 March
2015 2014 2015 2014 2015 2014
£m £m £m £m £m £m
Additions to non-current assets 157.1 160.9 - - 157.1 160.9
Total segment assets 1,300.6 1,200.4 2.6 5.8 1,303.2 1,206.2
Goodwill 88.8 80.2
Cash and cash equivalents 617.4 545.5
Taxation 156.3 125.0
Assets relating to discontinued Spanish operations 7.5 8.6
Total assets per Balance Sheet 2,173.2 1,965.5
Additional revenue analysis
Revenue by product division Year to Year to
31 March 31 March
2015 2014
£m £m
Accessories 892.5 816.1
Womens 743.0 684.0
Mens 557.5 520.8
Childrens/Other 77.7 78.4
Beauty 184.8 151.3
Retail/Wholesale 2,455.5 2,250.6
Licensing 67.7 79.2
Total 2,523.2 2,329.8
Revenue by destination Year to Year to
31 March 31 March
2015 2014
£m £m
Asia Pacific 938.1 870.3
EMEIA1 869.0 811.5
Americas 648.4 568.8
Retail/Wholesale 2,455.5 2,250.6
Licensing 67.7 79.2
Total 2,523.2 2,329.8
1 EMEIA comprises Europe, Middle East, India and Africa.
Entity-wide disclosures
Revenue derived from external customers in the UK totalled £233.3m for the
year to 31 March 2015 (2014: £213.2m).
Revenue derived from external customers in foreign countries totalled
£2,289.9m for the year to 31 March 2015 (2014: £2,116.6m).This amount includes
£551.6m of external revenues derived from customers in the USA (2014: £493.8m)
and £346.2m of external revenues derived from customers in China (2014:
£318.2m).
The total of non-current assets other than financial instruments and deferred
tax assets located in the UK is £197.7m (2014: £213.7m). The remaining £455.4m
of non-current assets are located in other countries (2014: £394.0m), with
£174.9m located in the USA (2014: £136.9m) and £87.8m located in China (2014:
£84.3m).
Notes to the Financial Information
5. Net operating expenses
Note Year to Year to
31 March 31 March2014£m
2015
£m
Selling and distribution costs 762.9 673.6
Administrative expenses 547.4 524.6
Adjusting items
Amortisation of the fragrance and beauty licence intangible asset 7 14.9 14.9
Total 1,325.2 1,213.1
6. Profit before taxation
Note Year to Year to
31 March 31 March
2015 2014
£m £m
Adjusted profit before taxation is stated after charging/(crediting):
Depreciation of property, plant and equipment
Within cost of sales 1.0 0.8
Within selling and distribution costs 88.8 88.7
Within administrative expenses 14.2 16.1
Amortisation of intangible assets
Within selling and distribution costs 1.7 2.2
Within administrative expenses 18.0 15.9
Loss/(profit) on disposal of property, plant and equipment and intangible assets 2.1 (1.3)
Net impairment charge relating to retail assets 4.1 12.3
Employee costs 468.1 441.3
Operating lease rentals
Minimum lease payments 190.9 156.5
Contingent rents 87.5 83.2
Net exchange (gain)/loss on revaluation of monetary assets and liabilities (1.4) 11.5
Net exchange gain on derivatives held for trading for the year (1.4) (4.2)
Trade receivables net impairment charge/(reversal) 0.1 (1.5)
Adjusting items
Amortisation of the fragrance and beauty licence intangible 7 14.9 14.9
Put option liability finance (income)/charges 7 (3.7) 1.7
7. Adjusting items
Amortisation of the fragrance and beauty licence intangible asset
During the year ended 31 March 2013, an intangible asset of £70.9m was
recognised on the Balance Sheet, relating to the present value of the
anticipated incremental income to be earned by the Group as a result of
selling Beauty products through retail and wholesale channels rather than
under licence, following the termination of the existing licence relationship
with Interparfums SA. This asset is amortised on a straight-line basis over
the period 1 April 2013 to 31 December 2017. The amortisation is presented as
an adjusting item, which is consistent with the treatment of the cost
recognised on termination of the licence relationship in the year ended 31
March 2013. The amortisation expense recognised for the year ended 31 March
2015 is £14.9m (2014: £14.9m) (refer to note 12). A related tax credit of
£3.1m (2014: £1.9m) has also been recognised in the current period.
Notes to the Financial Information
7. Adjusting items (continued)
Put option liability finance income/charge
The financing income of £3.7m for the year ended 31 March 2015 (2014: charge
of £1.7m) relates to fair value movements and the unwinding of the discount on
the put option liability over the non-controlling interest in Burberry
(Shanghai) Trading Co., Ltd. Refer to note 17 for further details of the
carrying value of the put option liability. No tax has been recognised on this
item, as it is not considered to be deductible for tax purposes.
8. Financing
Note Year to Year to
31 March 31 March
2015 2014
£m £m
Bank interest income 3.7 2.9
Other finance income 0.7 1.0
Finance income 4.4 3.9
Interest expense on bank loans and overdrafts (1.8) (1.6)
Bank charges (1.8) (1.4)
Other finance expense (0.2) (0.2)
Finance expense (3.8) (3.2)
Other financing income/(charges) - put option liability 7 3.7 (1.7)
Net finance income/(charge) 4.3 (1.0)
9. Taxation
Analysis of charge for the year recognised in the Group Income Statement:
Year to Year to
31 March 31 March
2015 2014
£m £m
Current tax
UK corporation tax
Current tax on income for the year to 31 March 2015 at 21% (2014: 23%) 58.8 69.1
Double taxation relief (0.7) (0.8)
Adjustments in respect of prior years (2.4) (3.8)
55.7 64.5
Foreign tax
Current tax on income for the year 60.9 50.9
Adjustments in respect of prior years 6.9 6.2
Total current tax 123.5 121.6
Deferred tax
UK deferred tax
Origination and reversal of temporary differences 2.1 2.3
Impact of changes to tax rates - 4.1
Adjustments in respect of prior years 0.9 0.2
3.0 6.6
Foreign deferred tax
Origination and reversal of temporary differences (21.3) (16.9)
Adjustments in respect of prior years (1.7) 0.8
Total deferred tax (20.0) (9.5)
Total tax charge on profit 103.5 112.1
Notes to the Financial Information
9. Taxation (continued)
Analysis of charge for the year recognised in other comprehensive income and
directly in equity:
Year to Year to
31 March 31 March
2015 2014
£m £m
Current tax
Recognised in other comprehensive income
Current tax charge/(credit) on exchange differences on loans (foreign currency translation reserve) 4.4 (4.6)
Total current tax recognised in other comprehensive income 4.4 (4.6)
Recognised in equity
Current tax credit on share options (retained earnings) (5.6) (9.6)
Total current tax recognised directly in equity (5.6) (9.6)
Deferred tax
Recognised in other comprehensive income
Deferred tax (credit)/charge on cash flow hedges deferred in equity (hedging reserve) (1.3) 0.9
Deferred tax credit on cash flow hedges transferred to income (hedging reserve) (0.2) (2.2)
Total deferred tax recognised in other comprehensive income (1.5) (1.3)
Recognised in equity
Deferred tax charge on share options (retained earnings) 0.4 5.8
Total deferred tax recognised directly in equity 0.4 5.8
The tax rate applicable on profit varied from the standard rate of corporation
tax in the UK due to the following factors:
Year to Year to
31 March 31 March
2015 2014
£m £m
Profit before taxation 444.6 444.4
Tax at 21% (2014: 23%) on profit before taxation 93.4 102.2
Rate adjustments relating to overseas profits 1.8 (2.9)
Permanent differences 5.6 3.4
Current year tax losses not recognised 2.4 1.9
Prior year tax losses recognised in the year (3.4) -
Adjustments in respect of prior years 3.7 3.4
Adjustments to deferred tax relating to changes in tax rates - 4.1
Total taxation charge 103.5 112.1
Total taxation recognised in the Group Income Statement arises on:
Year to Year to
31 March 31 March
2015 2014
£m £m
Adjusted profit before taxation 106.6 114.0
Adjusting items (3.1) (1.9)
Total taxation charge 103.5 112.1
Notes to the Financial Information
10. Earnings per share
The calculation of basic earnings per share is based on profit or loss
attributable to owners of the Company for the year divided by the weighted
average number of ordinary shares in issue during the year. Basic and diluted
earnings per share based on adjusted profit before taxation are also disclosed
to indicate the underlying profitability of the Group.
Year to Year to
31 March 31 March
2015 2014
£m £m
Attributable profit for the year before adjusting items1 344.4 337.2
Effect of adjusting items1 (after taxation) (8.1) (14.7)
Attributable profit for the year 336.3 322.5
1 Refer to note 7 for details of adjusting items.
The weighted average number of ordinary shares represents the weighted average
number of Burberry Group plc ordinary shares in issue throughout the year,
excluding ordinary shares held in the Group's ESOP trusts.
Diluted earnings per share is based on the weighted average number of ordinary
shares in issue during the year. In addition, account is taken of any options
and awards made under the employee share incentive schemes, which will have a
dilutive effect when exercised.
Year to Year to
31 March 31 March
2015 2014
Millions Millions
Weighted average number of ordinary shares in issue during the year 440.0 437.9
Dilutive effect of the employee share incentive schemes 7.8 9.4
Diluted weighted average number of ordinary shares in issue during the year 447.8 447.3
11. Dividends paid to owners of the Company
Year to Year to
31 March 31 March
2015 2014
£m £m
Prior year final dividend paid 23.20p per share (2014: 21.00p) 102.1 92.1
Interim dividend paid 9.70p per share (2014: 8.80p) 42.8 38.6
Total 144.9 130.7
A final dividend in respect of the year to 31 March 2015 of 25.50p (2014:
23.20p) per share, amounting to £112.4m, has been proposed for approval by the
shareholders at the Annual General Meeting subsequent to the balance sheet
date. The final dividend to Burberry Group plc shareholders has not been
recognised as a liability at the year end and will be paid on 31 July 2015 to
shareholders on the register at the close of business on 3 July 2015.
Notes to the Financial Information
12. Intangible assets
Cost Goodwill Trade marks, licences and other intangible assets Computersoftware£m Intangible assetsin the course ofconstruction£m Total
£m £m £m
As at 31 March 2013 86.3 99.0 77.9 5.8 269.0
Effect of foreign exchange rate changes (6.8) (0.4) (1.6) - (8.8)
Additions - 0.3 17.3 8.4 26.0
Reclassifications from assets in the course - - 4.9 (4.9) -
of construction
Business combinations 0.7 - - - 0.7
As at 31 March 2014 80.2 98.9 98.5 9.3 286.9
Effect of foreign exchange rate changes 8.6 (1.1) 0.8 - 8.3
Additions - 1.8 16.6 8.9 27.3
Disposals - (12.6) (0.1) (0.8) (13.5)
Reclassifications from assets in the course - - 5.2 (5.2) -
of construction
As at 31 March 2015 88.8 87.0 121.0 12.2 309.0
Accumulated amortisation and impairment
As at 31 March 2013 - 14.4 44.4 - 58.8
Effect of foreign exchange rate changes - (0.3) (1.0) - (1.3)
Charge for the year - 17.2 15.8 - 33.0
Net impairment charge on assets (note 13) - 1.0 - - 1.0
As at 31 March 2014 - 32.3 59.2 - 91.5
Effect of foreign exchange rate changes - (0.7) 1.1 - 0.4
Charge for the year - 16.4 18.2 - 34.6
Net impairment charge on assets (note 13) - 0.2 - - 0.2
Disposals - (11.1) (0.1) - (11.2)
As at 31 March 2015 - 37.1 78.4 - 115.5
Net book value
As at 31 March 2015 88.8 49.9 42.6 12.2 193.5
As at 31 March 2014 80.2 66.6 39.3 9.3 195.4
Fragrance and beauty licence intangible asset
During the year ended 31 March 2013, an intangible asset of £70.9m was
recognised on the Balance Sheet, relating to the present value of the
anticipated incremental income to be earned by the Group as a result of
selling Beauty products through retail and wholesale channels rather than
under licence following the termination of the existing licence relationship
with Interparfums SA. This asset is presented within the intangible asset
category 'trade mark, licences and other intangible assets', and is being
amortised on a straight-line basis over the period 1 April 2013 to 31 December
2017. The carrying value of the Beauty intangible at 31 March 2015 is £41.1m
(2014: £56.0m). No impairment has been recorded in the current period.
Management has considered the impact of a decrease in the future revenue
estimates used in the latest value-in-use calculation. Based on this
sensitivity, a decrease of 12% in future revenue projections, with no change
in operating profit margin, would imply an impairment of £10m as at 31 March
2015.
Notes to the Financial Information
12. Intangible assets (continued)
Impairment testing of goodwill
The carrying value of the goodwill allocated to cash generating units:
As at As at
31 March 31 March
2015 2014
£m £m
China1 45.8 40.7
Korea 25.1 23.3
Other 17.9 16.2
Total 88.8 80.2
1 The goodwill reported for China does not include any goodwill
attributable to the non-controlling interest.
The Group tests goodwill for impairment annually or where there is an
indication that goodwill might be impaired. The recoverable amount of all cash
generating units has been determined on a value-in-use basis. Value-in-use
calculations for each cash generating unit are based on projected three year
pre-tax discounted cash flows together with a discounted terminal value. The
cash flows have been discounted at pre-tax rates reflecting the Group's
weighted average cost of capital adjusted for country-specific tax rates and
risks. Where the cash generating unit has a non-controlling interest which was
recognised at a value equal to its proportionate interest in the net
identifiable assets of the acquired subsidiary at the acquisition date, the
carrying amount of the goodwill has been grossed up, to include the goodwill
attributable to the non-controlling interest, for the purpose of impairment
testing the goodwill attributable to the cash generating unit. The key
assumptions contained in the value-in-use calculations include the future
revenues, the margins achieved, the assumed life of the business and the
discount rates applied.
The value-in-use calculations have been prepared using management's approved
financial plans for the three years ending 31 March 2018. These plans contain
management's best view of the expected performance for the year ending 31
March 2016 and the expected growth rates for the two years ending 31 March
2017 and 31 March 2018. The plans are based on the performance achieved in the
current year and management's knowledge of the market environment and future
business plans. A terminal value has been included in the value-in-use
calculation based on the cash flows for the year ending 31 March 2018
incorporating the assumption that there is no growth beyond 31 March 2018.
For the material goodwill balances of China and Korea, a sensitivity analysis
has been performed on the value-in-use calculations by assuming no growth
beyond the year ending 31 March 2016. This sensitivity analysis indicated
significant headroom between the recoverable amount under this scenario and
the carrying value of goodwill and therefore management considered no further
detailed sensitivity analysis was required.
The pre-tax discount rates for China and Korea were 16.8% and 14.3%
respectively (2014: 17.2%; 14.6%).
No impairment has been recognised in respect of the carrying value of the
goodwill balance in the year as, for each cash generating unit, the
recoverable amount of goodwill exceeds its carrying value.
Notes to the Financial Information
13. Property, plant and equipment
Cost Freehold land and buildings Leasehold improvements Fixtures, Assets in the course of construction Total
£m £m fittings and £m £m
equipment1£m
As at 31 March 2013 104.2 303.1 366.3 23.2 796.8
Effect of foreign exchange rate changes (6.6) (25.4) (20.7) (1.7) (54.4)
Additions 1.0 55.4 60.4 18.1 134.9
Disposals (2.3) (13.7) (12.0) (0.1) (28.1)
Reclassification from assets in the course - 10.2 10.3 (20.5) -
of construction
Business combination - - 0.1 - 0.1
As at 31 March 2014 96.3 329.6 404.4 19.0 849.3
Effect of foreign exchange rate changes 3.3 23.2 3.7 1.0 31.2
Additions 7.0 48.7 48.1 26.0 129.8
Disposals - (18.3) (20.7) (1.0) (40.0)
Reclassification from assets in the course 1.1 8.1 8.0 (17.2) -
of construction
Reclassification2 29.8 (29.8) - - -
As at 31 March 2015 137.5 361.5 443.5 27.8 970.3
Accumulated depreciation and impairment
As at 31 March 2013 39.2 141.2 207.3 - 387.7
Effect of foreign exchange rate changes (2.0) (12.8) (12.5) - (27.3)
Charge for the year 1.5 36.0 68.1 - 105.6
Disposals (2.0) (12.5) (11.9) - (26.4)
Net impairment charge on assets - 5.7 5.6 - 11.3
As at 31 March 2014 36.7 157.6 256.6 - 450.9
Effect of foreign exchange rate changes (0.5) 11.5 2.4 - 13.4
Charge for the year 2.8 37.5 63.7 - 104.0
Disposals - (18.0) (20.4) - (38.4)
Net impairment charge on assets - 1.9 2.0 - 3.9
Reclassification2 9.2 (9.2) - - -
As at 31 March 2015 48.2 181.3 304.3 - 533.8
Net book value
As at 31 March 2015 89.3 180.2 139.2 27.8 436.5
As at 31 March 2014 59.6 172.0 147.8 19.0 398.4
1 Included in fixtures, fittings and equipment are finance lease assets
with a net book value of £2.3m (2014: £2.8m).
2 During the year ended 31 March 2015, £20.6m of assets were reclassified
from leasehold improvements to freehold land and buildings as this was more
representative of the nature of the assets.
During the year to 31 March 2015, a net impairment charge of £4.1m (2014:
£12.3m) was identified as part of the annual impairment review of the retail
store assets, £3.9m (2014: £11.3m) charged against property, plant and
equipment and £0.2m (2014: £1.0m) charged against intangible assets. The
impairment charge relates to 22 retail cash generating units (2014: 29 retail
cash generating units) for which the total recoverable amount at the balance
sheet date is £6.5m (2014: £10.0m).
Where indicators of impairment were identified, the impairment review compared
the value-in-use of the assets to the carrying values at 31 March 2015. The
pre-tax cash flow projections were based on financial plans of expected
revenues and costs of each retail cash generating unit, as approved by
management, and extrapolated beyond the budget year to the lease exit dates
using growth rates and inflation rates appropriate to each store's location.
The pre-tax discount rates used in these calculations were between 12.1% and
18.3% (2014: between 12.4% and 18.3%), based on the Group's weighted average
cost of capital adjusted for country-specific tax rates and risks.
Notes to the Financial Information
14. Trade and other receivables
As at As at
31 March 31 March
2015 2014
£m £m
Non-current
Deposits and other financial receivables 39.6 31.0
Other non-financial receivables 2.7 -
Prepayments 18.2 11.3
Total non-current trade and other receivables 60.5 42.3
Current
Trade receivables 193.6 171.2
Provision for doubtful debts (4.6) (5.3)
Net trade receivables 189.0 165.9
Other financial receivables 16.3 14.1
Other non-financial receivables 23.9 20.3
Prepayments 28.1 27.5
Accrued income 3.0 3.6
Total current trade and other receivables 260.3 231.4
Total trade and other receivables 320.8 273.7
Included in total trade and other receivables are non-financial assets of
£72.9m (2014: £59.1m).
The individually impaired receivables relate to balances with trading parties
which have passed their payment due dates or where uncertainty exists over
recoverability. As at 31 March 2015, trade receivables of £13.6m (2014:
£14.1m) were impaired. The amount of the provision against these receivables
was £4.6m as at 31 March 2015 (2014: £5.3m). It was assessed that a portion of
the receivables is expected to be recovered. The ageing of the impaired trade
receivables is as follows:
As at As at
31 March 31 March
2015 2014
£m £m
Current 0.1 -
Less than one month overdue 8.8 9.7
One to three months overdue 1.5 0.7
Over three months overdue 3.2 3.7
13.6 14.1
Notes to the Financial Information
14. Trade and other receivables (continued)
As at 31 March 2015, trade receivables of £7.5m (2014: £12.8m) were overdue
but not impaired. The ageing of these overdue receivables is as follows:
As at As at
31 March 31 March
2015 2014
£m £m
Less than one month overdue 4.5 7.6
One to three months overdue 2.3 4.5
Over three months overdue 0.7 0.7
7.5 12.8
Movement in the provision for doubtful debts is as follows:
Year to Year to
31 March 31 March
2015 2014
£m £m
As at 1 April 5.3 7.3
Increase/(decrease) in provision for doubtful debts 0.1 (1.5)
Receivables written off during the year as uncollectable (0.8) (0.5)
As at 31 March 4.6 5.3
As at 31 March 2015 there were £nil impaired receivables within other
receivables (2014: £nil).
The carrying amounts of the Group's non-derivative financial assets excluding
cash and cash equivalents by customer geographical location are:
Year to Year to
31 March 31 March
2015 2014
£m £m
Asia Pacific 105.0 88.2
EMEIA 78.2 70.8
Americas 64.7 55.6
247.9 214.6
15. Inventories
As at As at
31 March 31 March
2015 2014
£m £m
Raw materials 29.2 36.3
Work in progress 2.2 2.7
Finished goods 405.2 380.8
Total inventories 436.6 419.8
The cost of inventories recognised as an expense and included in cost of sales
amounted to £730.1m (2014: £646.2m).
The net movement in inventory provisions included in cost of sales for the
year ended 31 March 2015 was a cost of £31.3m (2014: £13.3m).
The cost of finished goods physically destroyed in the year is £19.7m (2014:
£11.0m).
Notes to the Financial Information
16. Cash and cash equivalents
As at As at
31 March 31 March
2015 2014
£m £m
Cash at bank and in hand 252.3 275.4
Short-term deposits 365.1 270.1
Total 617.4 545.5
17. Trade and other payables
As at As at
31 March 31 March20141£m
2015
£m
Non-current
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