REG - Sainsbury(J) PLC - Half-year Report <Origin Href="QuoteRef">SBRY.L</Origin> - Part 2
09/11/2017 07:07
- Part 2: For the preceding part double click ID:nRSI9865Va
increased by £74 million in the half to £494 million (2016/17: £420 million). Free cash flow was used to
fund dividends, capital injections into the Bank and to repay debt. Dividends of £144 million were paid in the half, which
are covered 3.4 times by free cash flow (2016/17: 2.8 times). Bank capital injections of £110 million were made in the
first half (2016/17: £100 million). Property related cash flow movements including strategic capital expenditure was £61
million favourable year-on-year mainly as a result of no freehold purchase in the current year (2016/17: £74 million
purchase of Chiswick).
Fair value, other non-cash and interest movements of £158 million were primarily driven by a £138 million reduction in the
value of US Dollar foreign exchange derivatives held to mitigate the Group's exposure to fluctuations in US Dollar
denominated purchases. The weighted average hedge rate ('WAHR') at 23 September 2017 was below the spot rate generating an
unrealised fair value loss (2016/17: £39 million unrealised profit as the WAHR at 24 September 2016 was above the spot
rate).
As at 23 September 2017, Sainsbury's had drawn debt facilities of £2,627 million (including the perpetual securities) and
undrawn committed credit facilities of £1,150 million. The Group also held £85 million of uncommitted facilities, of which
£3 million was drawn as at 23 September 2017.
On 17 October 2017 the Group refinanced its syndicated committed revolving credit facility. The revised facility of £1,450
million has three, four and five year tranches with an initial final maturity for the longer dated tranche of April 2023.
Sainsbury's expects 2017/18 year-end net debt to remain around £1.5 billion. We expect net debt to reduce over the medium
term.
Capital expenditure
Core retail capital expenditure was £239 million (2016/17: £236 million). Net retail capital expenditure was £274 million
(2016/17: £315 million) as increased 2017/18 Argos integration capital expenditure was more than offset by the acquisition
of the Chiswick freehold in the prior year.
In 2017/18, Sainsbury's expects core retail capital expenditure including business as usual Argos capital expenditure
(excluding Sainsbury's Bank and Argos integration capital expenditure) to be around £600 million. Core retail capital
expenditure is expected to be around £600 million per annum over the medium term.
We expect Argos integration capital expenditure to be around £90 million.
Financial ratios
Key financial ratios As at As at As at
23 September 24 September 11 March
2017 2016 2017
Return on capital employed (%)1 8.3 8.4 8.8
Return on capital employed (exc. pension deficit) (%)1 7.5 8.0 8.0
Adjusted net debt to EBITDAR2 3.4 times 4.0 times 3.7 times
Interest cover3 5.0 times 5.3 times 7.3 times
Fixed charge cover4 2.4 times 2.6 times 2.7 times
Gearing5 20.0% 20.6% 21.5%
Gearing (excluding pension deficit)6 18.1% 17.2% 19.1%
Key financial ratios
(with perpetual securities treated as debt)7
Adjusted net debt to EBITDAR 3.6 times 4.3 times 4.0 times
Gearing 29.2% 30.6% 30.9%
Gearing (excluding pension deficit) 26.2% 25.1% 27.3%
Key financial ratios
(with perpetual securities coupons excluded from net underlying finance costs)
Interest cover8 6.4 times 6.6 times 5.9 times
Fixed charge cover9 2.5 times 2.7 times 2.6 times
1 The 14 point period includes the opening capital employed as at 25 September 2016 and the closing capital employed
for each of the 13 individual four week periods to 23 September 2017.
2 Net debt of £1,387 million plus capitalised lease obligations of £5,830 million, divided by Group underlying EBITDAR
of £2,113 million, calculated for a 52 week period to 23 September 2017. Perpetual securities treated as equity.
3 Underlying profit before interest and tax divided by underlying net finance costs, where interest on perpetual
securities is included in underlying finance costs.
4 Group underlying EBITDAR divided by net rent and underlying net finance costs, where interest on perpetual
securities is included in underlying finance costs.
5 Net debt divided by net assets. Perpetual securities treated as equity.
6 Net debt divided by net assets, excluding pension deficit. Perpetual securities treated as equity.
7 On a statutory basis, the perpetual securities are accounted for as equity on the Balance Sheet. Treating the
perpetual securities, net of transaction fees, as debt increases net debt to £1,881 million, and reduces net assets to
£6,443 million.
8 Underlying profit before interest and tax divided by underlying net finance costs, where interest on perpetual
securities is excluded from underlying finance costs.
9 Group underlying EBITDAR divided by net rent and underlying net finance costs, where interest on perpetual
securities is excluded from underlying finance costs.
Property value
As at 23 September 2017, Sainsbury's estimated market value of properties, including our 50 per cent share of properties
held within property joint ventures, was £10.5 billion (11 March 2017: £10.3 billion). The £0.2 billion increase was a
result of a small yield movement.
Defined benefit pensions
At 23 September 2017, the net defined benefit obligation for the Group was £723 million (including HRG and the unfunded
obligation). The decrease in the deficit from 11 March 2017 was primarily driven by a rise in the discount rate from 2.70
per cent to 2.75 per cent since year-end.
Following agreement of the valuation of both schemes, the Group is committed to make annual contributions of £124 million
to the scheme (Sainsbury's scheme: £84 million; Argos scheme: £40 million). The next triennial valuations are for the March
2018 year-ends for both schemes.
Retirement benefit obligations
Sainsbury's Argos Group Group Group
As at As at As at As at As at
23 September 23 September 23 September 24 September 11 March
2017 2017 2017 2016 2017
£m £m £m £m £m
Present value of funded obligations (9,257) (1,369) (10,626) (11,305) (10,854)
Fair value of plan assets 8,645 1,207 9,852 9,816 9,920
IFRIC 14 additional liability - (4) (4) - -
Pension deficit (612) (166) (778) (1,489) (934)
Present value of unfunded obligations (22) (15) (37) (39) (40)
Retirement benefit obligations (634) (181) (815) (1,528) (974)
Deferred income tax asset 54 38 92 216 124
Net retirement benefit obligations (580) (143) (723) (1,312) (850)
Group income statement (unaudited)
for the 28 weeks to 23 September 2017
28 weeks to 28 weeks to 52 weeks to
23 September 24 September 11 March
2017 2016 2017
Note £m £m £m
Revenue 4 14,644 12,642 26,224
Cost of sales (13,658) (11,877) (24,590)
Gross profit 986 765 1,634
Administrative expenses (731) (527) (1,207)
Other income 28 219 215
Operating profit 283 457 642
Finance income 7 11 24 34
Finance costs 7 (75) (73) (136)
Share of post-tax profit/(loss) from joint ventures and associates 1 (36) (37)
Profit before taxation 220 372 503
Analysed as:
Underlying profit before tax 251 277 581
Non-underlying items 3 (31) 95 (78)
220 372 503
Income tax expense 8 (54) (73) (126)
Profit for the financial period 166 299 377
The notes on pages 25 to 47 form an integral part of these Condensed Consolidated Interim Financial Statements.
Group statement of comprehensive income (unaudited)
for the 28 weeks to 23 September 2017
28 weeks to 28 weeks to 52 weeks to
23 September 24 September 11 March
2017 2016 2017
Note £m £m £m
Profit for the financial period 166 299 377
Items that will not be reclassified subsequently to the income statement:
Remeasurement on defined benefit pension schemes 13 147 (869) (407)
Current tax relating to items not reclassified - 27 41
Deferred tax relating to items not reclassified (25) 118 28
122 (724) (338)
Items that may be reclassified subsequently to the income statement:
Currency translation differences (3) 2 5
Available-for-sale financial assets fair value movements 6 3 10
Items reclassified from available-for-sale financial assets reserve - (1) (1)
Cash flow hedges effective portion of fair value movements (121) 72 115
Items reclassified from cash flow hedge reserve 13 (29) (87)
Current tax on items that may be reclassified - - (1)
Deferred tax relating to items that may be reclassified 19 8 5
(86) 55 46
Total other comprehensive income/(expense) for the period (net of tax) 36 (669) (292)
Total comprehensive income/(expense) for the period 202 (370) 85
The notes on pages 25 to 47 form an integral part of these Condensed Consolidated Interim Financial Statements.
Group balance sheet (unaudited)
at 23 September 2017
28 weeks to 28 weeks to 52 weeks to
23 September 24 September 11 March
2017 2016 2017
Restated Restated
Note £m £m £m
Non-current assets
Property, plant and equipment 9,949 10,036 10,006
Intangible assets 833 795 803
Investments in joint ventures and associates 233 284 237
Available-for-sale financial assets 12b 465 389 435
Other receivables 39 68 69
Amounts due from Financial Services customers 12a 2,121 1,768 1,916
Derivative financial instruments 12b 1 17 10
13,641 13,357 13,476
Current assets
Inventories 1,928 1,903 1,775
Trade and other receivables 595 788 574
Amounts due from Financial Services customers 12a 3,020 2,415 2,686
Available-for-sale financial assets 12b 134 124 100
Derivative financial instruments 12b 18 136 94
Cash and cash equivalents 11 1,335 1,185 1,083
7,030 6,551 6,312
Assets held for sale 8 30 10
7,038 6,581 6,322
Total assets 20,679 19,938 19,798
Current liabilities
Trade and other payables (4,184) (4,263) (3,741)
Amounts due to Financial Services customers and other deposits 12a (4,803) (3,766) (4,284)
Borrowings (696) (227) (172)
Derivative financial instruments 12b (78) (40) (22)
Taxes payable (141) (90) (219)
Provisions (119) (171) (148)
(10,021) (8,557) (8,586)
Net current liabilities (2,983) (1,976) (2,264)
Non-current liabilities
Other payables (309) (308) (304)
Amounts due to Financial Services customers and other deposits 12a (762) (633) (637)
Borrowings (1,443) (2,113) (2,039)
Derivative financial instruments 12b (39) (48) (38)
Deferred income tax liability (171) (63) (162)
Provisions (182) (194) (186)
Retirement benefit obligations 13 (815) (1,528) (974)
(3,721) (4,887) (4,340)
Net assets 6,937 6,494 6,872
Equity
Called up share capital 626 625 625
Share premium account 1,123 1,118 1,120
Capital redemption reserve 680 680 680
Merger reserve 568 568 568
Other reserves 102 205 193
Retained earnings 3,342 2,802 3,190
Total equity before perpetual securities 6,441 5,998 6,376
Perpetual capital securities 248 248 248
Perpetual convertible bonds 248 248 248
Total equity 6,937 6,494 6,872
The notes on pages 25 to 47 form an integral part of these Condensed Consolidated Interim Financial Statements.
The prior year restatements relate to hindsight adjustments to the acquired Home Retail Group balance sheet as permitted
under IFRS 3 'Business Combinations'. See note 14 for more information.
Group cash flow statement (unaudited)
for the 28 weeks to 23 September 2017
28 weeks to 28 weeks to 52 weeks to
23 September 24 September 11 March
2017 2016 2017
Note £m £m £m
Cash flows from operating activities
Profit before tax 220 372 503
Net finance costs 64 49 102
Share of post-tax (profit)/loss from joint ventures and associates (1) 36 37
Operating profit 283 457 642
Adjustments for:
Depreciation expense 343 310 600
Amortisation expense 19 17 28
Non-cash adjustments arising from acquisitions 1 (2) 12
Financial Services impairment losses on loans and advances 35 9 33
Profit on sale of properties 3 (10) (116) (101)
Loss on disposal of intangibles 2 - 36
Profit on disposal of Pharmacy business - (98) (98)
Impairment charge of property, plant and equipment - 11 55
Share-based payments expense 19 21 32
Retirement benefit obligations (26) (211) (311)
Operating cash flows before changes in working capital 666 398 928
Changes in working capital
Increase in inventories (153) (127) (6)
Increase in current available-for-sale financial assets (58) (111) (126)
(Increase)/decrease in trade and other receivables (19) (172) 37
Increase in amounts due from Financial Services customers and other deposits (571) (230) (681)
Increase in trade and other payables 403 436 29
Increase in amounts due to Financial Services customers and other deposits 644 643 1,166
(Decrease)/increase in provisions and other liabilities (36) 9 (24)
Cash generated from operations 876 846 1,323
Interest paid (45) (49) (95)
Corporation tax paid (40) (51) (75)
Net cash generated from operating activities 791 746 1,153
Cash flows from investing activities
Purchase of property, plant and equipment (282) (307) (634)
Purchase of intangible assets (56) (47) (110)
Proceeds from disposal of property, plant and equipment 44 15 55
Acquisition of subsidiaries, net of cash acquired - 101 101
Capital return to Home Retail Group plc shareholders - (226) (226)
Share issuance costs on acquisition of Home Retail Group plc - (3) (3)
Investment in joint ventures and associates (8) (16) (16)
Interest received 8 9 18
Dividends and distributions received 16 23 65
Net cash used in investing activities (278) (451) (750)
Cash flows from financing activities
Proceeds from issuance of ordinary shares 3 3 6
Drawdown of short-term borrowings - 448 448
Repayment of short-term borrowings - (448) (492)
Repayment of long-term borrowings 5 (67) (64) (130)
Purchase of own shares (12) - -
Repayment of capital element of obligations under finance lease borrowings 5 (14) (17) (37)
Interest elements of obligations under finance lease payments 5 (4) (4) (8)
Dividends paid on ordinary shares 10 (144) (151) (230)
Dividends paid on perpetual securities (20) (20) (23)
Net cash used in financing activities (258) (253) (466)
Net increase/(decrease) in cash and cash equivalents 255 42 (63)
Opening cash and cash equivalents 1,077 1,140 1,140
Closing cash and cash equivalents 11 1,332 1,182 1,077
The notes on pages 25 to 47 form an integral part of these Condensed Consolidated Interim Financial Statements.
Group statement of changes in equity (unaudited)
for the 28 weeks to 23 September 2017
Called up share capital Share premium account Capital redemption and other reserves Merger reserve Retained earnings Total equity before perpetual securities Perpetual capital securities Perpetual convertible bonds Total equity
£m £m £m £m £m £m £m £m £m
At 12 March 2017 625 1,120 873 568 3,190 6,376 248 248 6,872
Profit for the period - - - - 164 164 - 2 166
Other comprehensive (expense)/income - - (86) - 122 36 - - 36
Total comprehensive (expense)/income for the period ended 23 September 2017 - - (86) - 286 200 - 2 202
Transactions with owners:
Dividends paid - - - - (144) (144) - - (144)
Distribution to holders of perpetual subordinated convertible bonds (net of tax) - - - - - - - (2) (2)
Amortisation of convertible bond equity component - - (5) - 5 - - - -
Share-based payments (net of tax) - - - - 17 17 - - 17
Purchase of own shares - - - - (12) (12) - - (12)
Allotted in respect of share option schemes 1 3 - - - 4 - - 4
At 23 September 2017 626 1,123 782 568 3,342 6,441 248 248 6,937
At 13 March 2016 550 1,114 835 - 3,370 5,869 248 248 6,365
Profit for the period - - - - 297 297 - 2 299
Other comprehensive income/(expense) - - 55 - (724) (669) - - (669)
Total comprehensive income/(expense) for the period ended 24 September 2016 - - 55 - (427) (372) - 2 (370)
Transactions with owners:
Dividends paid - - - - (155) (155) - - (155)
Acquisition of subsidiaries 75 - - 568 (3) 640 - - 640
Distribution to holders of perpetual subordinated convertible bonds (net of tax) - - - - - - - (2) (2)
Amortisation of convertible bond equity component - - (5) - 5 - - - -
Share-based payments (net of tax) - - - - 21 21 - - 21
Purchase of own shares1 - - - - (9) (9) - - (9)
Allotted in respect of share option schemes - 4 - - - 4 - - 4
At 24 September 2016 625 1,118 885 568 2,802 5,998 248 248 6,494
1 Purchase of own shares in the prior year of £9 million relate to Home Retail Group treasury shares that converted to
0.321 J Sainsbury plc shares as part of the acquisition on 2 September 2016.
The notes on pages 25 to 47 form an integral part of these Condensed Consolidated Interim Financial Statements.
Group statement of changes in equity (continued) (unaudited)
Called up share capital Share premium account Capital redemption and other reserves Merger reserve Retained earnings Total equity before perpetual securities Perpetual capital securities Perpetual convertible bonds Total equity
£m £m £m £m £m £m £m £m £m
At 13 March 2016 550 1,114 835 - 3,370 5,869 248 248 6,365
Profit for the year - - - - 359 359 12 6 377
Other comprehensive income/(expense) - - 46 - (338) (292) - - (292)
Total comprehensive income for the year ended 11 March 2017 - - 46 - 21 67 12 6 85
Transactions with owners:
Dividends paid - - - - (232) (232) - - (232)
Acquisition of subsidiaries 75 - - 568 (3) 640 - - 640
Adjustment to consideration in respect of share options - - - - 3 3 - - 3
Distribution to holders of perpetual securities (net of tax) - - - - - - (12) (6) (18)
Amortisation of convertible bond equity component - - (8) - 8 - - - -
Share-based payments (net of tax) - - - - 32 32 - - 32
Purchase of own shares1 - - - - (9) (9) - - (9)
Allotted in respect of share option schemes - 6 - - - 6 - - 6
At 11 March 2017 625 1,120 873 568 3,190 6,376 248 248 6,872
1 Purchase of own shares in the prior year of £9 million relate to Home Retail Group treasury shares that converted to
0.321 J Sainsbury plc shares as part of the acquisition on 2 September 2016.
The notes on pages 25 to 47 form an integral part of these Condensed Consolidated Interim Financial Statements.
Notes to the Condensed Consolidated Interim Financial Statements (unaudited)
1 General information
J Sainsbury plc is a public limited company (the 'Company') incorporated in the United Kingdom, whose shares are publicly
traded on the London Stock Exchange. The Company is domiciled in the United Kingdom and its registered address is 33
Holborn, London EC1N 2HT, United Kingdom.
The Condensed Consolidated Interim Financial Statements are unaudited but have been reviewed by the auditors whose report
is set out on page 50. The financial information presented herein does not amount to statutory accounts within the meaning
of Section 434 of the Companies Act 2006. The Annual Report and Financial Statements 2017 have been filed with the
Registrar of Companies. The Independent Auditors' report on the Annual Report and Financial Statements 2017 was unqualified
and did not contain a statement under Section 498 of the Companies Act 2006.
The financial period represents the 28 weeks to 23 September 2017 (comparative financial period 28 weeks to 24 September
2016; prior financial year 52 weeks to 11 March 2017). The financial information comprises the results of the Company and
its subsidiaries (the 'Group') and the Group's interests in joint ventures and associates.
The Group's principal activities are Food, General Merchandise & Clothing retailing and Financial Services.
2 Basis of preparation
The Interim Results, comprising the Condensed Consolidated Interim Financial Statements and the Interim Management Report,
have been prepared in accordance with the Disclosure and Transparency Rules of the Financial Conduct Authority and with IAS
34 'Interim Financial Reporting' as adopted by the European Union.
The financial information contained in the Interim Results is presented in sterling, rounded to the nearest million (£m)
unless otherwise stated.
The financial information contained in the Condensed Consolidated Interim Financial Statements should be read in
conjunction with the Annual Report and Financial Statements 2017, which were prepared in accordance with International
Financial Reporting Standards ('IFRSs') as adopted by the European Union. The accounting policies have remained unchanged
from those disclosed in the Annual Report for the year ended 11 March 2017 other than the adoption of the accounting
standards set out below which have not had any impact on the interim financial statements.
The Group cash flow statement at 24 September 2016 and 11 March 2017 included an additional line item for foreign exchange
differences, with an equal and opposite movement within working capital. For the period ended 23 September 2017, the Group
cash flow has been presented without this adjustment to better reflect the working capital movements. The comparative cash
flow statements have also been presented in this manner.
The prior year balance sheets as at 24 September 2016 and 11 March 2017 have both been restated following adjustments made
to the acquired Home Retail Group balance sheet as permitted by IFRS 3 'Business Combinations' (refer to note 14).
The preparation of interim financial statements requires management to make judgements, estimates and assumptions that
affect the application of accounting policies and the reported amounts of assets and liabilities, income and expense.
Actual results may differ from these estimates.
In preparing these Condensed Consolidated Interim Financial Statements, the significant judgements made by management in
applying the Group's accounting policies and the key sources of estimation uncertainty were the same as those that applied
to the Consolidated Financial Statements for the year ended 11 March 2017, with the exception of the following item:
· Taxes on income in the interim periods are accrued using the tax rate that would be applicable to expected total
annual earnings, also taking into account the impact of "discrete items" in the interim period.
Sainsbury's Bank plc and its subsidiaries have been consolidated for the six months to 31 August 2017 (24 September 2016:
six months to 31 August 2016; 11 March 2017: twelve months to 28 February 2017). Adjustments have been made for the effects
of significant transactions or events that occurred between this date and the Group's balance sheet date.
The Directors are satisfied that the Group has sufficient resources to continue in operation for the foreseeable future.
Accordingly, they continue to adopt the going concern basis in preparing the financial statements.
The Group has considered the following amendments to published standards that are effective for the Group for the financial
year beginning 12 March 2017 and concluded that they are either not relevant to the Group or that they do not have a
significant impact on the Group's financial statements other than disclosures. These standards and interpretations have
been endorsed by the European Union.
· Amendments to IAS 7 'Statement of cash flows' on the disclosures in financial statements
The following standards and revisions will be effective for future periods:
· IFRS 9 'Financial instruments'
· IFRS 15 'Revenue from contracts with customers'
· IFRS 16 'Leases'
Additional information on these new effective standards was provided in the Group's Annual Report for the year ended 11
March 2017 and is summarised below:
IFRS 9 'Financial instruments'
IFRS 9 'Financial instruments' was endorsed for adoption by the EU in November 2016 and is effective for the year ended 9
March 2019.
The most significant impact on the Group remains in relation to the impairment of financial assets, in particular amounts
due from Financial Services customers at Sainsbury's Bank and its subsidiaries. IFRS 9 introduces a three stage expected
credit loss ('ECL') model which is forward-looking and which generally will result in earlier recognition of credit losses
and therefore higher impairment provisions. The Group's implementation project is progressing in line with plan and a
parallel run of key models and processes at Sainsbury's Bank has commenced. The Group will disclose the expected financial
impact of IFRS 9 in its Annual Report and Financial Statements for the year ending 10 March 2018.
Any changes to recognition and measurement will be applied retrospectively by adjusting the opening balance sheet as at 11
March 2018. There is no requirement to restate comparative amounts.
IFRS 15 'Revenue from contracts with customers'
IFRS 15 'Revenue from contracts with customers' is effective for the year ending 9 March 2019.
As reported in the Annual Report for the year ended 11 March 2017, the Group has performed a detailed impact assessment,
identifying all current sources of revenue and analysing the accounting requirements for each under IFRS 15. Currently the
Group does not expect any material changes to either revenue or profit as a result of adopting IFRS 15.
IFRS 16 'Leases'
IFRS 16 'Leases' is effective for the year ending 7 March 2020 subject to EU endorsement.
IFRS 16 requires that all operating leases will need to be recognised on the balance sheet. Furthermore, rental expense in
the income statement will be replaced with depreciation and interest expense. The transition is likely to have a material
impact on reported assets, liabilities and the Group income statement, including underlying profit, as well as the
classification of lease-related cash flows within the Group cash flow statement. A detailed review of the expected impact
is currently underway, however the Group is unable to quantify the effect of transition until this is completed.
3 Non-GAAP performance measures
In order to provide shareholders with additional insight into the underlying performance of the business, items recognised
in reported profit or loss before tax which, by virtue of their size and/or nature do not reflect the Group's underlying
performance, are excluded from the Group's underlying results.
These adjusted items are as follows:
28 weeks to 28 weeks to 52 weeks to
23 September 2017 24 September 2016 11 March 2017
Gross Tax Gross Tax Gross Tax
£m £m £m £m £m £m
Underlying profit 251 (60) 277 (59) 581 (135)
Property-related
Profit on disposal of properties 2 1 113 (13) 98 (12)
Joint venture investment property fair value movements 3 - (14) - (25) -
Net impairment and onerous contract charge - - (30) - (37) -
Argos
Transaction costs relating to the acquisition of HRG - - (22) - (22) -
Argos integration costs (27) 5 (6) - (27) 4
Homebase separation (2) - (2) - (4) -
Sainsbury's Bank transition (20) 3 (16) 4 (60) 12
Focus
Divestments - - 69 (15) 72 (14)
IT write-offs - - - - (57) 11
Restructuring costs - - (13) 1 (33) 8
Other
Perpetual securities coupons 13 (3) 13 (3) 23 (5)
Non-underlying finance movements (2) - 12 (1) 10 (3)
Acquisition adjustments 20 (3) 1 - 8 (2)
IAS 19 pension expenses (18) 2 (10) 3 (24) 5
Tax adjustments
Prior year adjustments - - - - - (4)
Revaluation of deferred tax balances - 1 - 10 - 9
Total adjustments (31) 6 95 (14) (78) 9
Profit 220 (54) 372 (73) 503 (126)
Property-related
· Profit on disposal of properties for the period comprised £10 million for the Group (24 September 2016: £116 million;
11 March 2017: £101 million), included within other income and £(8) million for the property joint ventures (24 September
2016: £(3) million; 11 March 2017: £(3) million).
· Net impairment and onerous contract charge comprises £nil within property, plant and equipment (24 September 2016:
£(12) million; 11 March 2017: £(19) million) and onerous lease provisions of £nil (24 September 2016: £(18) million; 11
March 2017: £(18) million).
Argos
· Argos integration costs for the period of £(27) million were part of the previously announced £(130) million required
over the three years in order to achieve the synergies of £160 million.
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