REG - Sainsbury(J) PLC - Interim results <Origin Href="QuoteRef">SBRY.L</Origin> - Part 3
09/11/2016 07:06
- Part 3: For the preceding part double click ID:nRSI6797Ob
was £249 million.
The Sainsbury's defined benefit pension scheme was subject to a triennial valuation at March 2015. This was carried out by
Willis Towers Watson plc, the Scheme's independent actuary. On the basis of the assumptions agreed, the actuarial deficit
at 14 March 2015 was £740 million, an increase of £148 million from the March 2012 deficit of £592 million. Sainsbury's
made two cash payments in August 2015 and August 2016 of £125 million, and will increase overall committed contributions by
£6 million per annum to £84 million (including property partnership payments) until March 2021. The next valuation date is
effective from March 2018.
The HRG defined benefit pension scheme was subject to a triennial valuation as at 31 March 2015. This was carried out by
Willis Towers Watson plc, the Scheme's independent actuary. On the basis of the assumptions agreed, the actuarial deficit
as at 31 March 2015 was £315 million, an increase of £157 million from the March 2012 deficit of £158 million. Since the
valuation, the scheme has received £50 million in relation to the Homebase sale (£24 million of which was paid after the
acquisition) and £50 million from Sainsbury's. Contributions have been agreed at £40 million per annum until October 2021.
The next valuation date is effective from March 2018.
Retirement benefit obligations
HRG Sainsbury's Group Group Group
As at As at As at As at As at
24 September 2016 24 September 2016 24 September 2016 26 September 2015 12 March
2016
£m £m £m £m £m
Present value of funded obligations (1,479) (9,826) (11,305) (7,470) (7,625)
Fair value of plan assets 1,183 8,633 9,816 6,971 7,235
Pension deficit (296) (1,193) (1,489) (499) (390)
Present value of unfunded obligations (16) (23) (39) (16) (18)
Retirement benefit obligations (312) (1,216) (1,528) (515) (408)
Deferred income tax asset 63 153 216 42 19
Net retirement benefit obligations (249) (1,063) (1,312) (473) (389)
Group income statement (unaudited)
for the 28 weeks to 24 September 2016
28 weeks to 28 weeks to 52 weeks to
24 September 26 September 12 March
2016 2015 2016
Note £m £m £m
Revenue 5 12,642 12,419 23,506
Cost of sales (11,877) (11,662) (22,050)
Gross profit 765 757 1,456
Administrative expenses (527) (428) (850)
Other income 219 94 101
Operating profit 457 423 707
Finance income 6 24 9 19
Finance costs 6 (73) (82) (167)
Share of post-tax loss from joint ventures and associates (36) (11) (11)
Profit before tax 372 339 548
Analysed as:
Underlying profit before tax 277 308 587
Profit on disposal of properties 4 113 94 101
Investment property fair value movements 4 (14) (14) (18)
Non-underlying finance movements 4 12 (4) (22)
IAS 19 pension financing charge and scheme expenses 4 (10) (15) (28)
Perpetual securities coupons 4 13 4 15
Acquisition adjustments 4 1 1 3
One-off items 4 (20) (35) (90)
372 339 548
Income tax expense 7 (73) (75) (77)
Profit for the financial period 299 264 471
Earnings per share 8 Pence per share Pence per share Pence per share
Basic 14.8 13.6 23.9
Diluted 13.7 12.9 22.5
Underlying basic 11.2 12.0 24.2
Underlying diluted 10.4 11.4 22.8
Group statement of comprehensive income (unaudited)
for the 28 weeks to 24 September 2016
28 weeks to 28 weeks to 52 weeks to
24 September 26 September 12 March
2016 2015 2016
£m £m £m
Profit for the financial period 299 264 471
Items that will not be reclassified subsequently to the income statement:
Remeasurement on defined benefit pension schemes (869) 69 121
Current tax relating to items not reclassified 27 - -
Deferred tax relating to items not reclassified 118 (10) (36)
(724) 59 85
Items that may be reclassified subsequently to the income statement:
Currency translation differences 2 - 2
Available-for-sale financial assets fair value movements
Attributable to Group 3 (1) (1)
Items reclassified from available-for-sale assets reserve (1) - -
Cash flow hedges effective portion of fair value movements
Attributable to Group 72 (12) 4
Attributable to joint ventures and associates - - 1
Items reclassified from cash flow hedge reserve (29) 4 7
Deferred tax relating to items that may be reclassified 8 - 3
55 (9) 16
Total other comprehensive (expense)/income for the financial period (net of tax) (669) 50 101
Total comprehensive (expense)/incomefor the financial period (370) 314 572
Group balance sheet (unaudited)
at 24 September 2016
24 September 26 September 12 March
2016 2015 2016
Note £m £m £m
Non-current assets
Property, plant and equipment 10,047 9,754 9,764
Intangible assets 696 344 329
Investments in joint ventures and associates 284 353 327
Available-for-sale financial assets 12 389 182 340
Other receivables 68 85 103
Amounts due from Financial Services customers 1,768 1,581 1,649
Derivative financial instruments 12 17 17 17
13,269 12,316 12,529
Current assets
Inventories 1,909 1,013 968
Trade and other receivables 788 600 508
Amounts due from Financial Services customers 2,415 1,690 1,695
Available-for-sale financial assets 12 124 - 48
Derivative financial instruments 12 136 45 51
Cash and bank balances 10b 1,185 1,266 1,143
6,557 4,614 4,413
Non-current assets held for sale 30 38 31
6,587 4,652 4,444
Total assets 19,856 16,968 16,973
Current liabilities
Trade and other payables (4,251) (3,281) (3,077)
Amounts due to Financial Services customers and other deposits (3,766) (3,256) (3,173)
Borrowings (227) (177) (223)
Derivative financial instruments 12 (40) (46) (43)
Taxes payable (90) (125) (158)
Provisions (152) (42) (46)
(8,526) (6,927) (6,720)
Non-current liabilities held for sale - (4) (4)
(8,526) (6,931) (6,724)
Net current liabilities (1,939) (2,279) (2,280)
Non-current liabilities
Other payables (308) (248) (269)
Amounts due to Financial Services customers and other deposits (633) (375) (582)
Borrowings (2,113) (2,314) (2,190)
Derivative financial instruments 12 (48) (45) (69)
Deferred income tax liability (82) (244) (237)
Provisions (124) (85) (129)
Retirement benefit obligations 13 (1,528) (515) (408)
(4,836) (3,826) (3,884)
Net assets 6,494 6,211 6,365
Equity
Called up share capital 625 550 550
Share premium account 1,118 1,114 1,114
Capital redemption reserve 680 680 680
Merger reserve 568 - -
Other reserves 205 133 155
Retained earnings 2,802 3,239 3,370
Total equity before perpetual securities 5,998 5,716 5,869
Perpetual securities 496 495 496
Total equity 6,494 6,211 6,365
Group cash flow statement (unaudited)
for the 28 weeks to 24 September 2016
28 weeks to 28 weeks to 52 weeks to
24 September 26 September 12 March
2016 2015 2016
Note £m £m £m
Cash flows from operating activities
Cash generated from operations 10a 846 375 624
Interest paid (49) (65) (108)
Corporation tax paid (51) (63) (124)
Net cash generated from operating activities 746 247 392
Cash flows from investing activities
Purchase of property, plant and equipment (307) (360) (646)
Purchase of intangible assets (47) (30) (34)
Proceeds from disposal of property, plant and equipment 15 68 109
Receipt of advance disposal proceeds - - 125
Acquisition of subsidiaries net of cash acquired 101 - -
Capital return to Home Retail Group plc shareholders 3 (226) - -
Share issue costs on acquisition of Home Retail Group plc (3) - -
Investment in joint ventures (16) (6) (18)
Disposal of subsidiaries - - (1)
Interest received 9 8 19
Dividends received 23 7 46
Net cash used in investing activities (451) (313) (400)
Cash flows from financing activities
Proceeds from issuance of ordinary shares 3 7 8
Drawdown of short-term borrowings 448 - -
Repayment of short-term borrowings (448) (95) (95)
Repayment of long-term borrowings (64) (176) (238)
Proceeds from issue of perpetual capital securities - 247 247
Proceeds from issue of perpetual convertible bonds - 247 247
Purchase of own shares - - (20)
Repayment of capital element of obligations under finance lease payments (17) (17) (30)
Interest elements of obligations under finance lease payments (4) (5) (9)
Dividends paid on ordinary shares (151) (157) (234)
Dividends paid on perpetual securities (20) - (4)
Net cash (used in)/generated from financing activities (253) 51 (128)
Net increase/(decrease) in cash and cash equivalents 42 (15) (136)
Net opening cash and cash equivalents 1,140 1,276 1,276
Closing cash and cash equivalents 10b 1,182 1,261 1,140
Group statement of changes in equity (unaudited)
for the 28 weeks to 24 September 2016
Called up share capital Share premium account Capital redemption and other reserves Merger reserve Retained earnings Total equity before perpetual securities Perpetual securities Total equity
£m £m £m £m £m £m £m £m
At 12 March 2016 550 1,114 835 - 3,370 5,869 496 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 (note 3) 75 - - 568 (3) 640 - 640
Distributions to holders of perpetual subordinated convertible bonds (net of tax) - - - - - - (2) (2)
Amortisation of convertible bond equity component - - (5) - 5 - - -
Share-based payment (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 5,998 496 6,494
1 Purchase of own shares in the 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.
Called up share capital Share premium account Capital redemption and other reserves Retained earnings Total equity before perpetual securities Perpetual securities Total equity
£m £m £m £m £m £m £m
At 15 March 2015 548 1,108 826 3,057 5,539 - 5,539
Profit for the period - - - 262 262 2 264
Other comprehensive (expense)/income - - (9) 59 50 - 50
Total comprehensive (expense)/ income for the period ended 26 September 2015 - - (9) 321 312 2 314
Transactions with owners:
Dividends paid - - - (157) (157) - (157)
Issue of perpetual subordinated capital securities and perpetual subordinated convertible bonds - - - - - 495 495
Distributions to holders of perpetual subordinated convertible bonds (net of tax) - - - - - (2) (2)
Amortisation of convertible bond equity component - - (4) 4 - - -
Share-based payment (net of tax) - - - 14 14 - 14
Purchase of own shares - - - - - - -
Allotted in respect of share option schemes 2 6 - - 8 - 8
At 26 September 2015 550 1,114 813 3,239 5,716 495 6,211
Group statement of changes in equity (continued) (unaudited)
Called up share capital Share premium account Capital redemption and other reserves Retained earnings Total equity before perpetual securities Perpetual securities Total equity
£m £m £m £m £m £m £m
At 15 March 2015 548 1,108 826 3,057 5,539 - 5,539
Profit for the year - - - 452 452 19 471
Other comprehensive income 16 85 101 - 101
Total comprehensive income for the year ended 12 March 2016 - - 16 537 553 19 572
Transactions with owners:
Dividends paid - - - (234) (234) - (234)
Issue of perpetual subordinated capital securities and perpetual subordinated convertible bonds (net of tax) - - - - - 496 496
Distributions to holders of perpetual subordinated convertible bonds (net of tax) - - - - - (19) (19)
Amortisation of convertible bond equity component - - (7) 7 - - -
Share-based payment (net of tax) - - - 23 23 - 23
Purchase of own shares - - - (20) (20) - (20)
Allotted in respect of share option schemes 2 6 - - 8 - 8
At 12 March 2016 550 1,114 835 3,370 5,869 496 6,365
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 56. 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 2016 have been filed with the
Registrar of Companies. The Independent Auditors' report on the Annual Report and Financial Statements 2016 was unqualified
and did not contain a statement under Section 498 of the Companies Act 2006.
The financial period represents the 28 weeks to 24 September 2016 (comparative financial period 28 weeks to 26 September
2015; prior financial year 52 weeks to 12 March 2016). 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, clothing and general merchandise retailing and retail 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 2016, which were prepared in accordance with International
Financial Reporting Standards ('IFRSs') as adopted by the European Union. As part of the acquisition of Home Retail Group
plc an exercise has been performed to ensure that the accounting policies within both businesses are aligned. Based on this
review, there have been no material changes to existing accounting policies from those disclosed in the annual report for
the year ended on 12 March 2016 other than the adoption of the accounting standards set out below which have not had any
impact on the interim financial statements. The prior year interim diluted and underlying diluted earnings per share has
been amended (refer to note 8).
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 12 March 2016, with the exception of the following items:
· 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.
· As a result of the acquisition of Home Retail Group plc on 2 September 2016, significant estimation has been
exercised in determining the fair value of the net assets acquired.
Sainsbury's Bank plc has been consolidated for six months to 31 August 2016 (26 September 2015: six months to 31 August
2015, 12 March 2016: twelve months to 29 February 2016). 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 13 March 2016 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. These standards and interpretations have been endorsed by the
European Union.
· Amendments to IFRS 11, 'Joint arrangements' on accounting for acquisitions of interests in joint operations
· Amendments to IAS 16, 'Plant, property and equipment' and IAS 38, 'Intangible assets' on acceptable methods of
depreciation and amortisation
· Amendments to IAS 27, 'Consolidated and separate financial statements' which allows entities to equity account for
joint ventures and associates in their separate financial statements
· Annual improvements 2012 - 2014
3 Acquisition of Home Retail Group plc
On 2 September 2016, the Group acquired 100 per cent of the issued share capital of Home Retail Group plc ("HRG"), a listed
company based in the United Kingdom, by means of a Scheme of Arrangement under Part 26 of the Act for a consideration of
£1,093 million. The full analysis of the consideration is shown below:
Form of consideration Consideration fair value at acquisition date£m
Cash of £447 million (being 55p per existing share); fair value is based on Home Retail Group plc's share capital of 813,445,001 shares in existence as at the acquisition date. 447
£3 million in relation to the contractual requirement to settle certain existing HRG share scheme awards and options 3
261 million new J Sainsbury plc shares of 28p nominal value each were issued (being 0.321 new J Sainsbury plc shares per existing Home Retail Group plc share); fair value of the consideration is based on a J Sainsbury plc share price of £2.4610 as of 2 September 2016. 643
Total 1,093
Home Retail Group's activities mainly comprise general merchandise related retailing. The acquisition is expected to
accelerate Sainsbury's growth strategy in Clothing and General Merchandise retailing as well as its online presence. The
combination brings together two of the UK's leading retail businesses with complementary product offers through an
integrated, multi-channel proposition.
None of the goodwill recognised of £18 million is expected to be deductible for income tax purposes. This was calculated as
the difference between the fair value of consideration paid and the fair value of net assets acquired as set out in the
following table.
The provisional assets and liabilities recognised as a result of the acquisition are as follows:
Fair value of net assets acquired as at 2 September 2016 (provisional) £m
Fixed assets 274
Intangible assets 326
Inventories 816
Trade and other receivables 141
Deferred tax assets 41
Amounts due from Financial Services customers (the "loan book") 615
Other financial assets1 60
Cash and cash equivalents2 548
Total assets acquired 2,821
Trade and other payables2 (1,203)
Provisions (89)
Defined benefit obligations (454)
Total liabilities acquired (1,746)
Net identifiable assets acquired at fair value 1,075
Goodwill arising on acquisition 18
Purchase consideration transferred 1,093
1 Other financial assets includes £9 million of J Sainsbury plc shares (converted from Home Retail Group plc own
shares at the point of acquisition). On consolidation these become J Sainsbury plc own shares and are transferred to
equity.
2 Cash and cash equivalents and trade and other payables acquired are both presented gross of the capital return of
£226 million.
In accordance with IFRS 3 'Business Combinations', the acquisition accounting will be finalised within 12 months of the
acquisition date of 2 September 2016.
(a) Intangible assets
Intangible assets include a brand of £179 million relating to the Argos brand name. This reflects its fair value at the
acquisition date and is estimated to have a useful economic life of ten years.
(b) Trade and other receivables
Trade and other receivables include £40 million of trade receivables, against which a bad debt provision of £(1) million is
held. Also included are prepayments and accrued income of £29 million, and other debtors of £73 million.
(c) Amounts due from Financial Services customers (the "loan book")
The gross fair value of the loan book is £681 million against which a provision for impairment of £(66) million is held.
This is inclusive of a fair value uplift of £20 million.
(d) Revenue and profit contribution
From the date of acquisition, Home Retail Group has contributed £235 million of revenue excluding VAT, £1 million of
underlying profit before tax and a statutory loss before tax of £(5m) to the Group. If the acquisition date had been on the
first day of the financial year, Group revenues for the period would have been £14,432 million, Group underlying profit
before tax would have been £259 million and Group profit before tax would have been £279 million. These amounts have been
calculated using the Group's accounting policies. The information is provided for illustrative purposes only and is not
indicative of the results of the combined Group that would have occurred had the purchase actually been made at the
beginning of the year, or indicative of the future results of the combined Group.
(e) Acquisition-related costs
Acquisition-related costs (included in administrative expenses and recognised outside of underlying profit) amount to £22
million in the current period (12 March 2016: £12 million) (see note 4). In addition £3 million of costs relating to the
issuance of J Sainsbury plc shares have been recognised directly within equity.
(f) Cash impact of acquisition
£m
Cash consideration (447)
Cash acquired 548
Acquisition of subsidiaries, net of cash acquired (included in cash flow statement) 101
Capital return to shareholders of Home Retail Group plc (see below) (226)
Net cash impact of acquisition (125)
(g) Capital return
Prior to the acquisition of Home Retail Group plc, it was announced that Home Retail Group plc shareholders would be
entitled to a £226 million capital return comprising the following:
· 25.0 pence per share, reflecting the £200 million return to shareholders in respect of the sale of Homebase by Home
Retail Group plc on 29 February 2016; and
· 2.8 pence per share (totalling £26 million) in lieu of a final dividend in respect of Home Retail Group plc's
financial year ended 27 February 2016.
This was recorded as a liability in the net assets acquired above within trade and other payables. The full amount was paid
on 12 September 2016.
4 Non-GAAP performance measures
Certain items recognised in reported profit or loss before tax can vary significantly from year to year and therefore
create volatility in reported earnings which does not reflect the Group's underlying performance. Similarly, whilst defined
benefit pension scheme expenses may not vary significantly, they no longer relate to the Group's ongoing activities given
the closure of the defined benefit pension scheme to future accrual. The Directors believe that the 'underlying revenue',
'underlying profit before tax' ('UPBT') and 'underlying diluted and basic earnings per share' measures presented provide a
clear and consistent presentation of the underlying performance of Sainsbury's ongoing business for shareholders.
Underlying profit is not defined by IFRS and therefore may not be directly comparable with the 'adjusted' profit measures
of other companies. The adjusted items are:
· Profit/loss on disposal of properties (included within other income);
· Investment property fair value movements - these reflect the difference between the fair value of an investment
property at the reporting date and its carrying amount at the previous reporting date;
· Non-underlying finance movements - these are fair value gains and losses on non-derivative financial assets and
liabilities carried at amortised cost, on derivatives relating to financing activities and on hedged items in fair value
hedges, as well as the discount unwind on provisions relating to non-underlying items;
· The financing element of IAS 19 'Employee Benefits' and defined benefit scheme expenses;
· Coupons on 'perpetual securities' (perpetual subordinated capital securities and perpetual subordinated convertible
bonds) - the coupons on the perpetual securities are accounted for as equity in line with IAS 32 'Financial Instruments:
Presentation', however are accrued on a straight line basis and included as an expense within underlying profit (see note
12);
· Acquisition adjustments - these reflect the adjustments arising from the Sainsbury's Bank and Home Retail Group
acquisitions, including the fair value unwind and amortisation of acquired intangibles; and
· One-off items - these are items which are material and infrequent in nature and do not relate to the Group's
underlying performance (see tables below).
The adjustments made to reported profit before tax to arrive at underlying profit before tax are:
28 weeks to 28 weeks to 52 weeks to
24 September 26 September 12 March
2016 2015 2016
£m £m £m
Underlying profit before tax 277 308 587
Profit on disposal of properties1 113 94 101
Investment property fair value movements (14) (14) (18)
Non-underlying finance movements2 12 (4) (22)
IAS 19 pension financing charge and scheme expenses3 (10) (15) (28)
Perpetual securities coupons4 13 4 15
Acquisition adjustments 1 1 3
One-off items (20) (35) (90)
Total adjustments 95 31 (39)
Profit before tax 372 339 548
1 Profit/(loss) on disposal of properties for the 28 weeks to 24 September 2016 comprised £116 million for the Group
(26 September 2015: £94 million, 12 March 2016: £100 million) and £(3) million for the joint ventures (26 September 2015:
£nil, 12 March 2016: £1 million).
2 Non-underlying finance movements for the 28 weeks to 24 September 2016 comprised £13 million for the Group (26
September 2015: £(3) million, 12 March 2016: £(20) million) and £(1) million for the joint ventures (26 September 2015:
£(1) million, 12 March 2016: £(2) million).
3 Comprises pension financing charge for the 28 weeks to 24 September 2016 of £(8) million (26 September 2015: £(12)
million, 12 March 2016: £(22) million) and defined benefit scheme expenses of £(2) million (26 September 2015: £(3)
million, 12 March 2016: £(6) million).
4 The coupons on the 'perpetual securities' (perpetual subordinated capital securities and perpetual subordinated
convertible bonds) are accounted for as equity in line with IAS 32 'Financial Instruments: Presentation', however are
accrued on a straight line basis and included as an expense within underlying profit before tax.
Acquisition adjustments
Acquisition adjustments of £1 million (26 September 2015: £1 million, 12 March 2016: £3 million) comprise the following:
28 weeks to 28 weeks to 52 weeks to
24 September 26 September 12 March
2016 2015 2016
£m £m £m
Acquisition adjustments arising on purchase of HRG
Cost of sales (2) - -
Administrative expenses 3 - -
Total Home Retail Group acquisition adjustments 1 - -
Acquisition adjustments arising on purchase of Sainsbury's Bank
Revenue 3 5 11
Cost of sales - 1 2
Administrative expenses (intangible amortisation) (3) (5) (10)
Total Sainsbury's Bank acquisition adjustments - 1 3
Total acquisition adjustments 1 1 3
One-off items
One-off items of £(20) million (26 September 2015: £(35) million, 12 March 2016: £(90) million) comprise the following:
28 weeks to 28 weeks to 52 weeks to
24 September 26 September 12 March
2016 2015 2016
£m £m £m
Net gain/(transaction costs) on disposal of pharmacy business 98 - (3)
Impairment and onerous contract (charge)/reversal (30) 3 (1)
Sainsbury's Bank transition costs (16) (25) (59)
Home Retail Group acquisition costs (22) - (12)
Argos integration costs (6) - -
Homebase separation and restructuring costs (2) - -
Netto closure costs (23) - -
Internal restructuring costs (19) (13) (15)
(20) (35) (90)
5 Segment reporting
The Group's businesses are organised into three operating segments:
· Retail (Food and Clothing & General Merchandise);
· Financial Services (Sainsbury's Bank and Argos Financial Services); and
· Property Investments (The British Land Company PLC joint venture and Land Securities Group PLC joint venture).
Management have determined the operating segments based on the information provided to the Operating Board (the Chief
Operating Decision Maker for the Group) to make operational decisions on the management of the Group. All material
operations and assets are in the UK. The 28 weeks to 24 September 2016 includes 3 weeks of Home Retail Group results (from
2 September 2016) - the second half will contain a full 24 weeks.
Revenue from operating segments is measured on a basis consistent with the revenue number disclosure in the income
statement. Revenue is generated by the sale of goods and services.
Segment results, assets and liabilities include items directly attributable to a segment as well as those that can be
allocated on a reasonable basis.
The Operating Board assesses the performance of all segments on the basis of underlying profit before tax. The
reconciliation provided below reconciles underlying operating profit from each of the segments disclosed to profit before
tax.
28 weeks to 24 September 2016 Retail£m Financial Services£m Property Investment£m Group£m
Segment revenue
Retail sales to external customers
- More to follow, for following part double click ID:nRSI6797OdRecent news on J Sainsbury
See all newsREG - Sainsbury(J) PLC - Total Voting Rights
AnnouncementREG - Skipton Bldg.Soc. - Directorate change
AnnouncementREG - Sainsbury(J) PLC - EMTN Programme Publication of Base Prospectus
AnnouncementREG - Sainsbury(J) PLC - Transaction in Own Shares and Programme Completion
AnnouncementREG - Sainsbury(J) PLC - Block listing Interim Review
Announcement